Q1 2024 Personalis Inc Earnings Call

Operator: Good day, and welcome to the Personalis first quarter 2024 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then 1 on a touch-tone phone. To withdraw your question, please press star then 2. Please note this event is being recorded. I would now like to turn the conference over to Mr. Aaron Tachibana. Please go ahead.

Good day and welcome to the personnel is first quarter 'twenty 'twenty four earnings conference call. All participants will be in listen only mode should you need assistance. Please signal a conference specialist by pressing the Starkey followed by zero. After today's presentation there'll be an opportunity to ask questions to ask a question.

You May press Star then one on a touchtone phone to withdraw your question. Please press Star then two please.

Please note this event is being recorded.

I would now like to turn the conference over to Mr. Aaron Tachibana. Please go ahead.

Aaron L. Tachibana: Thank you operator.

Aaron L. Tachibana: Welcome to Personalis' first quarter 2024 earnings call. Joining today's call are Chris Hall, Chief Executive Officer and President, and I am Aaron Tachibana, Chief Financial and Chief Operating Officer, and Rich Chen, Chief Medical Officer and EVP of R&D. All statements made on this call that do not relate to matters of historical fact should be considered forward-looking statements within the meaning of U.S. securities laws. For example,

Aaron L. Tachibana: Welcome to personality as first quarter 2024 earnings call. Joining today's call are Chris Hall, Chief Executive Officer, and President and I Am Aaron Tachibana, Chief financial and Chief operating Officer, and Rich Chen Chief Medical Officer, and EVP of R&D.

Speaker Change: All statements made on this call that do not relate to matters of historical fact should be considered forward looking statements within the meaning U S securities laws.

Aaron L. Tachibana: For example.

Aaron L. Tachibana: Any statements regarding trends and expectations for our financial performance this year and longer term, cash runway, revenue expectations and timing, reimbursement goals, size and booking of orders, products, services, technology, and clinical milestones; The Outcome and Timing of Reimbursement Decisions, Expectations for our Existing and Future Collaboration Activities, Cost Expectations, Our Market Opportunity, and Business Outlook. These statements are subject to risks and uncertainties that could cause actual results to differ materially from our current expectations. We encourage you to review our most recent filings with the SEC, including the risk factors described in our most recent filing. Personalis undertakes no obligation to update these statements, except as required by applicable law.

Aaron L. Tachibana: Any statements regarding trends and expectations.

Aaron L. Tachibana: For our financial performance this year and longer term cash runway revenue expectations and timing reimbursement goal.

Aaron L. Tachibana: And booking of orders products services technology clinical write downs.

Aaron L. Tachibana: I'll come and timing of reimbursement decisions.

Aaron L. Tachibana: Spectation for our existing and future collaboration activities.

Aaron L. Tachibana: Expectations, our market opportunity and business outlook.

Aaron L. Tachibana: These statements are subject to risks and uncertainties that could cause actual results to differ materially from our current expectations. We encourage you to review our most recent filings with the SEC, including the risk factors described in our most recent filings.

Aaron L. Tachibana: Personnel undertakes no obligation to update these statements except as required by applicable law.

Aaron L. Tachibana: Our press release with our first quarter 2024 results is available on our website, www.cdc.gov, personalis dot com, under the Investors section and includes additional details about our financial results. Our website also has our latest SEC filings, which we encourage you to review. A recording of today's call will be available on our website by 5 p.m. Pacific time today. Now, I would like to turn the call over to Chris for his comments and first quarter business highlights.

Aaron L. Tachibana: Our press release with our first quarter 2024 results is available on our website.

Aaron L. Tachibana: New Ww.

Aaron L. Tachibana: Personnel is dot com.

Chris: Under the investors section and includes additional details about our financial results.

Aaron L. Tachibana: Our website also has our latest SEC filings, which we encourage you to review.

Aaron L. Tachibana: A recording of today's call will be available on our website.

Chris: Five P M Pacific time today.

Aaron L. Tachibana: Now I would like to turn the call over to Chris for his comments and first quarter business highlights.

Christopher M. Hall: Thank you, Aaron. Good afternoon, everyone, and thank you for joining us.

Chris: Thank you Aaron good afternoon, everyone and thank you for joining us I'm very proud of our team at personality as we continue to fight cancer with our novel technologies.

Christopher M. Hall: I'm very proud of our team at Personalis as we continue to fight cancer with our novel technology. For those of you joining one of our calls for the first time, welcome. Personalis is one of the leaders in the fast-growing MRD testing market. MRD stands for Minimal Residual Disease. With our first-of-its-kind ultra-sensitive MRD test, we're able to spot cancer when there is only one fragment of tumor DNA circulating in a million DNA fragments in the blood.

Christopher M. Hall: Those of you joining one of our calls for the first time welcome.

Christopher M. Hall: Personality is one of the leaders in the fast growing <unk> testing market <unk> stands for minimal residual disease.

Aaron L. Tachibana: With our first of its kind ultra sensitive MRV test, we're able to spot cancer. When it's only one fragment of tumor DNA circulating in a million DNA fragments of the blood our.

Christopher M. Hall: Our technologies are used by many of the world's top biopharma companies to improve clinical trial results, find new ways to personalize treatment, and power a new generation of more effective therapies. Last quarter, we laid out a strategy to drive Personalis to $100 million in revenue in 2025. This aspirational milestone with three underlining growth engines is our load star as we are accelerating Personalis into a higher growth mode. In the first quarter, we achieved revenue of $19.5 million, exceeding the upper end of our guidance of $18 to $19 million.

Christopher M. Hall: Our technologies are used by many of the world's top biopharma companies to improve clinical trial results find new ways to personalize treatment and power a new generation of more effective therapies.

Christopher M. Hall: Last quarter, we laid out a strategy to drive personalities to $100 million in revenue in 2025.

Christopher M. Hall: This aspirational milestone with re underlining growth engine is our lodestar is we are accelerating personality into a higher growth mode.

Christopher M. Hall: In the first quarter, we achieved revenue of $19 5 million exceeding the upper end of our guidance of $18 million to $19 million or.

Christopher M. Hall: Our biopharma business grew 55% compared to the first quarter of 2023, driven by strong demand for our core immuno ID platform to support the individualized neoantigen therapy market, as well as increasing demand for our MRD product next person. With this increased demand, we have the confidence to increase our full-year revenue guidance to $76 to $78 million from $73 to $75 million. I'll now review progress this quarter on the three growth engines driving us towards our 100 million in 2025 goal and our progress on. The first growth engine is the most important, as we focus on turning personalis into a clinical diagnostic powerhouse.

Aaron L. Tachibana: Our biopharma business grew 55% compared to the first quarter of 2023, driven by strong demand for our core platform.

Aaron L. Tachibana: Port the individualized neo antigen therapy market as well as increasing demand for our <unk> product next personal.

Christopher M. Hall: With this increased demand we have the confidence to increase our full year revenue guidance to 76 to 78 million from 73 to 75 million.

Aaron L. Tachibana: I'll now review progress this quarter on the REIT growth engines, driving us towards our $100 million in 2025 goal and our progress on each.

Christopher M. Hall: The first growth engine is the most important as we focus on turning personality into a clinical diagnostic powerhouse.

Christopher M. Hall: In order to do that, we're executing on our WIN and MRD strategies. The MRD market involves using liquid biopsy to find evidence of minimal residual disease or cancer recurrence and subsequently monitoring therapy effectiveness. It's estimated that this market will mature into a $20 billion opportunity over the coming years.

Christopher M. Hall: We're going to do that we're executing on our winning MRV strategy EMR.

Christopher M. Hall: <unk> D market involves using liquid biopsy to find evidence of minimal residual disease or cancer recurrence and subsequently monitoring therapy effectiveness.

Christopher M. Hall: Estimated that this market will mature into a $20 billion opportunity over the coming years, and we are establishing personality as a leader in this space.

Christopher M. Hall: And we are establishing Personalis as a leader in this space. Our WIN and MRD strategy has four pillars. First, to focus on and launch our test in cancer types where an ultrasensitive liquid biopsy test can unlock significant value for patients, payers, and partners. Second, to drive reimbursement by developing robust clinical evidence and partnering with the top global collaborators. Third, leverage our deep relationships to accelerate adoption by biopharma partners and power our revenue growth through the use of NEXT personal and clinical trials.

Christopher M. Hall: Our winning them R&D strategy has four pillars first to focus and launch our test in cancer types, where an ultra sensitive liquid biopsy tests and unlock significant value for patients payers and partners.

Christopher M. Hall: To drive reimbursement by developing robust clinical evidence a partnering with top global collaborators.

Christopher M. Hall: Third leverage our deep relationships to accelerate adoption by Biopharma partners and power our revenue growth by the use of next personal in clinical trials and lastly to commercialize next partner next personal with a partner centric model.

Christopher M. Hall: And lastly, to commercialize NEXT personal with a partner-centric model. To delve into the first pillar, we previously explained how we're developing evidence to support next personal's clinical usage and reimbursement in early stage lung cancer, breast cancer, and immunotherapy monitor. We believe our ultra-sensitive technology allows us to see cancer earlier, which may provide the information to deescalate patients from unnecessary, unnecessary therapies and procedures, potentially Sparing Patients from Toxicity and Saving Healthcare Dollars.

Christopher M. Hall: So 12 into the first pillar. We previously explained how we are developing evidence to support next personal clinical usage and reimbursement and early stage lung cancer breast cancer and immunotherapy monitoring we believe our ultra sensitive technology allows us to see cancer earlier, which may provide the information deescalate patients from a nurse.

Christopher M. Hall: So sarah unnecessary therapy and procedures potentially.

Christopher M. Hall: Sparing patients from toxicity and saving health care dollars.

Christopher M. Hall: Just as importantly, we believe we can identify and get recurrent patients to treatment earlier with potentially better outcomes. Our focus on these indications is intentional, and our data has demonstrated that NextPersonal can win in these markets. To elaborate a bit on our approach, early stage lung cancer and breast cancer shed very little DNA into the blood, which is difficult to detect without an ultrasensitive approach.

Christopher M. Hall: Just as importantly, we believe we can identify and get recurrent patients to treatment earlier with potentially better outcomes. Our focus on these indications is intentional and our data has demonstrated that next personal can win in these markets to elaborate a bit on our approach early stage lung cancer and breast cancer shed.

Christopher M. Hall: DNA in the blood, which are difficult to detect without an ultra sensitive approach early detection is critical in these indications for patients on Io therapy, we believe the potential decision to switch treatment requires the insights from monitoring that are provided by our ultra sensitive test.

Christopher M. Hall: Early detection is critical in these indications. For patients on IO therapy, we believe the potential decision to switch treatment requires insights from monitoring that are provided by ultrasensitive tests. Now, you might recall that last October, we launched our MRD test, NEXT Personal, and today we are enrolling physicians in an early access program, or EAP. We are the first ultra-sensitive MRD test to commercially enter the market, and with that launch, we now have two laboratory-developed tests, or LDTs, on the market, the other being our Medicare reimbursed test, NEXT DX, which is used by physicians to put a patient on targeted therapy.

Christopher M. Hall: Now you might recall that last October we launched our M. R. D tests next personal and today, we are enrolling physicians in an early access program or EAP mirrored the first ultra sensitive and marquee tested commercially entered the market and with that with that launch. We now have two laboratory developed test or L. D cheese on the market.

Christopher M. Hall: The other being our Medicare reimbursed tests next Dx, which is used by physicians to put a patient on targeted therapy. The adoption of these tests has been rapid and is exceeding our initial target. We delivered 338 clinical tests in the first quarter of solid uptick from the 126 results delivered in the fourth quarter of last year.

Christopher M. Hall: The adoption of these tests has been rapid and is exceeding our initial target. We delivered 338 clinical tests in the first quarter, a solid uptick from the 126 results delivered in the fourth quarter of last year. We're pleased with this traction as the number of physicians that were ordering in Q1 remained fixed at 10 through the quarter. There are two key metrics that I want to talk about and dive into.

Christopher M. Hall: We're pleased with this traction as the number of physicians that were ordering in Q1 remained fixed at 10 through the quarter.

Christopher M. Hall: There are two key metrics that I wanted to talk about a dive into first all 10 of our early access physicians are ordering an uptick has been strong across the entire cohort.

Christopher M. Hall: First, all 10 of our early access positions are ordering, and uptick has been strong across the entire cohort. The second metric involves the actionability of our next personal MRD test for the clinic. If you remember, we report circulating tumor DNA in the blood down to one part per million, which means if there is just one fragment of tumor DNA circulating in a million DNA fragments in the blood, we expect to see and quantify it.

Christopher M. Hall: The second metric involves the action ability of our next person way Mark D tests for the clinic.

Christopher M. Hall: You remember we report circulating tumor DNA in the blood down to one part per million, which means if theres just one fragment of tumor DNA circulating in affiliate DNA fragments blood, we expect to see you quantify it. This is a leap forward for the field.

Christopher M. Hall: This is a leap forward for the field. The extra sensitivity we report on with our next personal assay, values between one and 100 parts per million, reveals a region that has previously been hard to see consistently. We call that region the ultra-sensitive MRD.

Christopher M. Hall: Extra sensitivity, we report on with our next traditional assay, which are values between one and 100 parts per million.

Christopher M. Hall: <unk> a region that has previously been hard to see consistently we call that region, the ultra sensitive and Mark D range until next personal clinicians cannot retuned routinely detect cancer recurrence at that level and today they can.

Christopher M. Hall: Until next year, personal clinicians could not routinely detect cancer recurrence at that level, and today they can. About 40% of the ctDNA positive samples thus far in our clinical testing have been in this ultrasensitive range. That's a significant jump in the performance of MRT testing. It means that physicians can see cancer recurrence earlier, have more discrimination in monitoring therapy, and have more confidence that ctDNA patients that are negative are likely cancer-free. Indeed, we've had many reports relayed from our 10 early access doctors that the ultrasensitive range is allowing them to see cancer earlier with their patients and intervene to get them the management they need. We believe it is the ultra-sensitive range that allows a doctor to see cancer sooner, and seeing it sooner is the cornerstone of our WIN and MRD strategies. Now, moving to the second pillar.

Christopher M. Hall: 40% of the C. T DNA positive samples thus far in her clinical testing have been in this ultra sensitive range. That's a significant jump in the performance of M. D testing. It means that physicians can see cancer recurrence earlier have more discrimination and monitoring therapy and have more confidence that C. T D N a patient center.

Christopher M. Hall: Negative are likely cancer free indeed, we've had many anecdotes related from our 10 early access doctors that the ultra sensitive range is allowing them to see cancer earlier with their patients and to intervene to get them the management they need.

Christopher M. Hall: We believe it is the ultra sensitive range that allows the doctor to see cancer sooner and Phoenix sooner is the cornerstone of our winning them R&D strategy.

Christopher M. Hall: Now moving to the second pillar.

Christopher M. Hall: We're focused on building and publishing clinical evidence to gain reimbursement, and we are working with many of the top thought leaders in the world. In previous calls, we talked about the importance of our work with Royal Marston and Breast Cancer and BHIO and immunotherapy monitoring. Both of these collaborators have provided access to studies that are broad and comprehensive. In the case of Royal Marston, one of the leading global institutions in breast cancer, we're focusing on patients with early-stage disease for several subtypes, including ER positive, HER2 positive, and triple negative breast.

Christopher M. Hall: We're focused on building and publishing clinical evidence to gain reimbursement and are working with many of the top thought leaders in the world in previous calls we've talked about the importance of our work with Royal Marsden in breast cancer in ph ILD immunotherapy monitor both of these collaborators have provided access to studies that are broad and comprehensive in the case of Royal Marsh.

Christopher M. Hall: And one of the leading global institutions in breast cancer, we're focusing on patients with early stage disease for several subtypes, including ER positive her two positive and triple negative breast cancer for V. H I O. The work is pan cancer across many cancer types and stages.

Christopher M. Hall: For VHIO, the work is pan-cancer across many cancer types and stages. These studies are anchor studies in that they will be the backbone of our efforts to gain Medicare reimbursement. Royal Marsden for early stage breast cancer and VHIO for immunotherapy monitoring.

Christopher M. Hall: That is our anchor studies and that they will be the backbone of our efforts to gain Medicare reimbursement Royal Marsden for early stage breast cancer in V. H I L for immunotherapy monitoring.

Christopher M. Hall: We're excited that at the upcoming ASCO conference, the work with both of these collaborators will be featured as oral podium presentations. We also have three other studies featured at ASCO, one with Dana Farber on her two positive patients, another with Duke for immunotherapy monitoring for gastric patients, and lastly, one in colorectal cancer patients. Having this breadth of data should underscore Personalis' commitment at Personalis to developing rich data to support the use of NextPersonal in the clinic and to gain reimbursement. At the AACR conference in April, some compelling data was presented.

Christopher M. Hall: We're excited that at the upcoming <unk> conference to work with both of these collaborators will be featured as oral oral podium presentations.

Christopher M. Hall: So I have three other studies feature Tabasco, one with Dana Farber.

Christopher M. Hall: Her two positive patients another with Duke for immunotherapy monitoring for gastric patients and lastly, one in colorectal cancer patients.

Christopher M. Hall: Having this breadth of data should underscore our commitment at personality to developing rich data to support the use of next personal in the clinic and to gain reimbursement quickly.

Christopher M. Hall: At the ACR conference in April some compelling data was presented our collaborators from the U K. He gave an oral podium presentation on late stage melanoma patients where they use next personal to monitor and detect immunotherapy response, highlighting the importance of detection of DNA in the ultra sensitive range. In addition, our work.

Christopher M. Hall: Our collaborators from the UKE gave an oral podium presentation on late-stage melanoma patients where they used NexPersonal to monitor and detect immunotherapy response, highlighting the importance of detection of ctDNA and the ultrasensitive range. In addition, our work in collaboration with AstraZeneca on their MATRIX study was presented. The MATRIX abstract showed NexPersonal achieved very strong sensitivity and specificity on blinded test samples provided by AZ down to the lowest levels at two parts per million.

Christopher M. Hall: In collaboration with Astrazeneca on their matrix study was presented the matrix abstract show next personal achieved very strong sensitivity and specificity on blinded.

Christopher M. Hall: Samples provided by AZ down to the lowest levels at two parts per million. Subsequently, we were selected as a partner by Astrazeneca for MRV testing in their upcoming trials. We've also presented data from collaborators with a personalized cancer vaccine company and our analytical validation data for next personal that was re.

Christopher M. Hall: Subsequently, we were selected as a partner by AstraZeneca for MRD testing in their upcoming trials. We've also presented data from our collaboration with a personalized cancer vaccine company, and our analytical validation data for NexPersonal, which was recently published, was also at the AACR conference. The third pillar of our next personal strategy is to leverage our biopharma relationships to drive the use of next personal and clinical trials. We're engaged with most of the world's top biopharma companies and have continued to generate excitement around our next personal test.

Christopher M. Hall: Singly published was also.

Christopher M. Hall: <unk> was also at the ACR conference.

Christopher M. Hall: Third pillar of our next personal strategy is to leverage our biopharma relationships to drive the use of <unk> personnel in clinical trials, we're engaged with most of the world's top biopharma companies and have continued to generate excitement around our necks personal test. Most recently from discussion today see our customers want and need an ultra sensitive approach.

Christopher M. Hall: Most recently, from discussions at AACR, customers want an ultrasensitive approach to ensure that the most appropriate patients enter into a clinical trial. For example, we believe that our ultrasensitive assay means that patients testing negative are much less likely to have a recurrence.

Christopher M. Hall: To ensure that the most appropriate patients enter into a clinical trial. For example, we believe that our ultra sensitive assay. It means that patients tested negative are much much less likely to have a recurrence or biopharma company customers. Can then expect that these patients are less likely to benefit from a therapeutic intervention holding out the pro.

Christopher M. Hall: Our biopharma customers can then expect that these patients are less likely to benefit from a therapeutic intervention, holding out the promise that NexPersonal could be an excellent approach to optimized biopharma trials. Indeed, here in the first quarter, we've booked record new orders for NexPersonal. The product helped to drive our strong Q1 financial performance, and we believe it will be a driver of revenue moving forward and an important way for us to deepen the clinical utility of X Person.

Christopher M. Hall: Thomas at next personal can be an excellent approach to optimize Bart biopharma trials deep here in the first quarter, we booked record new orders for next person the product helped to drive our strong Q1 financial performance and we believe it will be a driver of revenue moving forward an important way for us to deepen the clinical utility of <unk>.

Christopher M. Hall: Personal.

Christopher M. Hall: Now I'll move on to the fourth and final pillar, commercializing next personal using a partner-centric model. In December, we announced our key partnership with Tempest to commercialize next personal, an ex-personal in the clinic with oncology. To quickly review, we expect to leverage Tempest's up to approximately 200-person sales channel to co-commercialize NextPersonal and accelerate growth. Personalis will be responsible for processing samples in our lab, obtaining reimbursement, and invoicing health insurance payers and patients under the arrangement, while paying Tempest fair market value for the commercial services they provide. Overall, the deal is worth approximately $30 million for Personalis should all the milestone payments be triggered and if Tempest fully exercises its warrant.

Christopher M. Hall: Now I'll move on to the fourth and final pillar commercializing next personal using a partner centric model in December we announced our key partnership with Tempus to commercialize next personal Dx and ex personal in the clinic with oncologists to quickly review, we expect to leverage tempus up to 10% up to approximately 200 persons.

Christopher M. Hall: Sales channel to co commercialize next personal and accelerate growth personality will be responsible for processing samples in our lap obtaining reimbursement and invoicing health insurance payers and patients under the arrangement, while paying tempus fair market value for the commercial services they provide to us overall the deal.

Christopher M. Hall: It's worth approximately $30 million for personality and all the milestone payments would be triggered and if temperance fully exercised their warrants. We expect this to allow us to ramp up commercial efforts quickly with minimal additional cash investments we plan to launch with Tempus this quarter by expanding our early access program to include some of temperatures.

Christopher M. Hall: We expect this to allow us to ramp up commercial efforts quickly with minimal additional cash investments. We plan to launch with Tempest this quarter by expanding our early access program to include some of its features. The goal is to learn how to work together as partners, integrating our business systems, and refining our message to oncologists, so we're set to drive accelerated growth together on the backside of reimbursement approvals. Now, while we've made strides with our first growth engine, our win in MRD strategy to establish NextPersonal as a leading MRD test, we also made progress with our second growth engine, leveraging our ImmunoID Our biopharmaceutical segment grew 55% year over year, and we had solid performance across our product portfolio.

Christopher M. Hall: Clients. The goal is to learn how to work together as partners integrating our business systems refining our message to oncologist. So we're set to drive accelerated growth together on the backside of reimbursement approval.

Christopher M. Hall: Now, while we made strides with our first growth engine, our winning MRV strategy to establish next person with a leading M. A R. T test. We also made progress with our second growth engine, leveraging our immuno <unk> next platform to deepen relationships with biopharma customers, who use the offering to pioneer new therapies our biopharma.

Christopher M. Hall: Segment grew 55% year over year, and we had solid performance across our product portfolio customers, primarily use our immuno I D X platform in two ways first they use our platforms to power translational research and find new Biomarkers and new insights that can power their drug discovery efforts.

Christopher M. Hall: Customers primarily use our ImmunoIDx platform in two ways. First, they use our platform to power translational research and find new biomarkers and new insights that can power their drug discovery efforts. Second, companies in the personalized cancer vaccine market use our platform to create a molecular fingerprint of a patient's tumor to power a personalized therapy. We previously told you about our partnership with Moderna, in which Moderna is utilizing our platform in their mRNA cancer program.

Christopher M. Hall: Second companies in the personalized cancer vaccine market use our platform to create a molecular fingerprint of a patient's tumor to power personalized therapy. We previously told you about our partnership with Madonna and which Madonna is utilizing our platform and their M. RNA cancer program, but turn and its partner Merck are enrolling.

Christopher M. Hall: Moderna and its partner Merck are enrolling patients, and our collaboration with Moderna is an important driver of revenue for us in 2024 and 2025. We have several other partners that work in the space as well. The third growth engine, the third engine of our growth strategy, is growing our personalis inside approach as we service enterprise customers.

Christopher M. Hall: <unk> and our collaboration with modern is an important driver of revenue for us in 2024 and 2025, we have several other partners that work in this space as well.

Christopher M. Hall: The third growth engine third engine of our growth strategy is growing our personalities inside approach as we service enterprise customers.

Christopher M. Hall: In these relationships, partners adopt our platforms and technologies to power their solutions and provide new insights to their customers. For example, our work with Niterra involves leveraging our sequencing platform to analyze the exome as part of their MRD product. We believe our relationship is strong and mutually beneficial and are optimistic that it will extend into 2025. The second important enterprise relationship is the VA. The VA utilizes our whole genome sequencing capabilities to power the Million Veteran Program, a national research program looking at how genes and lifestyle affect the health of veterans. We've helped power this program with the VA for, Both of these relationships are examples.

Christopher M. Hall: And these relationships partners adopt our platforms and technologies to power their solution to provide new insights to their customers or work with Terra involves leveraging our sequencing platform to analyze the exome as a part of their emerging product. We believe our relationship is strong and mutually beneficial and are optimistic that it will extend into 2025.

Christopher M. Hall: A second important enterprise relationship as of yet uba utilizes a whole genome sequencing capabilities to power the millions better program and National Research program looking at how genes and lifestyle affect the health of batteries.

Christopher M. Hall: Power This program with the VA for years both of these relationships are examples.

Christopher M. Hall: How Our Platforms Drive Value for Partners and, importantly, Provide Sequencing Scale for People Now, before I turn it over to Aaron to go deeper on the financials, I have a few exciting corporate updates. First, we continue to innovate and deepen our strong intellectual property. We have recently had two new patents issued by the USPTO. In fact, one just yesterday relating to the use of two of our core technologies, tumor-informed personalized assays in the first patent and boosted exome panels in the second patent, each to inform a cancer vaccine.

Christopher M. Hall: How our platforms drive value partners, and importantly provide sequencing scale personality, but before I turn it over to Aaron to.

Christopher M. Hall: This latest patent is the fourth U.S. patent to issue in 2024, and today our number of issued U.S. patents is over 30. We believe we have a deep set of IP protecting our pioneering work in both MRD and PCV. We're engaged in litigation with Foresight Diagnostics to enforce and protect some of our IP relating to MRD. As is often the case, there will be ups and downs along the way in that journey.

Christopher M. Hall: Go deeper on the financials I have a few exciting corporate updates first.

Christopher M. Hall: We continue to innovate and deepen our strong intellectual property position, we had two new patents recently issued by the U S. P. T O. In fact, one just yesterday relating to the use of two of our core technologies tumor informed personalized assays in the first patent and boosted exome panels in the second patent each.

Christopher M. Hall: <unk> to inform cancer vaccine treatments.

Christopher M. Hall: This latest patent is the fourth U S patent issue in 2024 and today, our number of issued U S. Patents over 30, we believe we have a deep set of IP protecting our pioneering work in both <unk> and P. C. D. We're engaged in litigation with foresight diagnostics to enforce and protect some of our IP relating to that Marty as often.

Christopher M. Hall: The case there'll be ups and downs, along the way and that journey. However, we are confident we're set up for long term success to establish an industry leading position of around the use of whole genome sequencing for NRG and are optimistic about the path forward and.

Christopher M. Hall: However, we are confident we're set up for long-term success to establish an industry-leading position around the use of whole genome sequencing for MRD and are optimistic about the path forward. We processed our 400,000 samples since our company's inception, and importantly, we completed our 175,000 whole genome sequencing samples. Whole genome sequencing is the foundation of our next personal MRD test, and these milestones underline both our sequencing scale and unique operational capabilities. With that, I will now turn it over to Aaron to review our financial report.

Aaron: And second we crossed two milestones this quarter, we processed our 400000 samples since our company's inception, and importantly, we completed our 175th ALS and whole genome sequencing sample whole genome is the foundation of our next personal M. R. D tests and these milestones underlying both are.

Aaron: Sequencing scale and unique operational capabilities.

Christopher M. Hall: That I will now turn it over to Aaron to review our financial results.

Aaron: Thank you Chris.

Aaron L. Tachibana: Our strong first quarter 2024 financial results demonstrate our ongoing commitment to execution against our milestones and scaling revenue. I will be providing details about our first quarter financial results and guidance for the second quarter and full year of 2024.

Aaron: Our strong first quarter of 2024 financial results demonstrate our ongoing commitment to execution against our milestones and scaling revenue.

Aaron: I will be providing details about the first quarter financial results and guidance for the second quarter and full year 2024.

Aaron L. Tachibana: Total company revenue for the first quarter of 2024 was $19.5 million and increased 4% compared with $18.9 million for the same period of the prior year. The increase in revenue was driven by higher volume from biopharma and personalized cancer vaccine customers, which was partially offset by declines from Natera and the VAMVP. Biopharma revenue grew 55% as compared to the same period last year, and the growth was from ImmunoID Next and also from our MRD test, Next Personal, which is beginning to ramp up with many customers.

Aaron: Total company revenue for the first quarter 2024 was $19 5 million and increased 4% compared with $18 9 million for the same period of the prior year.

Aaron L. Tachibana: The increase in revenue was driven by higher volume of Biopharma and personalized cancer vaccine customers, which was partially offset by declines from the terror and the VA MVP.

Aaron L. Tachibana: Biopharma revenue grew 55% as compared to the same period last year and the growth was from you you know I do next and also from our MRV test next personal which is beginning to ramp up with many customers.

Aaron L. Tachibana: In addition, we achieved a significant milestone and recognized our first clinical revenue in the amount of $0.2 million from Next DX, for which we received Medicare reimbursement coverage in January of this year. Gross margin was 20.1% for the first quarter compared to 25.1% for the same period of the prior year. The year-over-year increase of three percentage points was primarily due to favorable customer mix from the increase in biopharma revenue and also operating leverage from the increase in total company revenue. Operating expenses were $24.4 million in the first quarter compared to $34.6 million for the same period of the prior year. Most of the year-over-year decrease was attributed to actions taken to reduce headcount in 2023.

Aaron L. Tachibana: In addition, we achieved a significant milestone and recognized our first clinical revenue in the amount of $2 million from next Dx.

Aaron L. Tachibana: Which we received Medicare reimbursement coverage in January of this year.

Aaron L. Tachibana: Gross margin was 21% for the first quarter compared to 25, 1% for the same period prior year the.

Aaron L. Tachibana: The year over year increase of three percentage points was primarily due to favorable customer mix from the increase in Biopharma revenue and also operating leverage from the increase in total company revenue.

Aaron L. Tachibana: Okay.

Aaron L. Tachibana: Operating expenses were $24 $4 million in the first quarter compared with $34 6 million for the same period the prior year.

Aaron L. Tachibana: Most of the year over year decrease was attributed to the actions taken to reduce head count in 2023.

Aaron L. Tachibana: R&D expense was $12.8 million in the first quarter compared to $16.6 million for the same period last year. And SG&A expense was $11.6 million compared to $14.1 million for the same period last year. The net loss for the first quarter was $13 million compared to $28.7 million for the same period of the prior year. The first quarter net loss included a $4.8 million non-cash gain related to fair value accounting of the outstanding warrants issued to Tempe.

Aaron L. Tachibana: R&D expense was $12 8 million in the first quarter compared with $16 6 million for the same period.

Aaron L. Tachibana: Of last year, and SG&A expense was $11 6 million compared to $14 1 billion from the same period last year.

Aaron L. Tachibana: Net loss for the first quarter was $13 million compared to $28 7 million for the same period of the prior year.

Aaron L. Tachibana: First quarter net loss included a $4 $8 million non cash gain related to fair value accounting of the outstanding warrants issued to 10 minutes.

Aaron L. Tachibana: This non-standard income was a result of the decrease in fair market value of the warrants at March 31, 2024, compared with the fair market value at the end of the previous quarter. And for clarification, the accounting implications of the warrants will have no bearing on the cash value if they are exercised.

Aaron L. Tachibana: This non standard income was a result of the decrease in fair market value of the warrants at March 31 2024.

Aaron L. Tachibana: Paired with a fair market value at the end of last quarter.

Aaron L. Tachibana: And for clarification, the accounting implications for the warrants will have no bearing on the cash value. If they are exercised in the future.

Aaron L. Tachibana: Now on to the balance sheet. We finished the first quarter with a strong balance sheet, with cash and short-term investments of $95.4 million. During the quarter, we used $18.8 million to fund operations, and we have approximately two years of cash on the balance sheet, which is expected to last through the first quarter of 2026. Now I'd like to turn to guidance.

Speaker Change: Now onto the balance sheet.

Aaron L. Tachibana: We finished the first quarter with a strong balance sheet with cash and short term investments of $95 $4 million during the quarter, we used $18 8 million to fund operations and we have approximately two years of cash on the balance sheet.

Aaron L. Tachibana: She is expected to last through the first quarter of 2026.

Aaron L. Tachibana: For the second quarter of 2024, we expect total company revenue in the range of $19.5 to $20.5 million, revenue from pharmaceutical tests, enterprise sales, and other customers in the range of $18 to $19 billion, and revenue from Population Sequencing of approximately $1.5 million. And for the full year 2024, we now expect total company revenue in the range of 76 to 78 million, an increase from the prior estimate of $73 to $75 million.

Aaron L. Tachibana: Now I'd like to turn to guidance.

Aaron L. Tachibana: For the second quarter 2024, we expect total company revenue in the range of 19 point by $25 million.

Aaron L. Tachibana: Revenue from pharma test enterprise sale and other customers in the range of $18 billion to $19 billion.

Aaron L. Tachibana: And revenue from population sequencing of approximate $1 5 million.

Aaron L. Tachibana: And for the full year of 2024.

Aaron L. Tachibana: We now expect total company revenue in the range of $76 million to $78 million an increase from the prior estimate.

Aaron L. Tachibana: <unk> $73 million to $75 million.

Aaron L. Tachibana: Revenue from pharma tests, enterprise sales, and other customers in the range of $68-$70 million, which increased from the prior estimate of $65-$67 million. Population Sequencing revenue to be approximately $8 million. Non-GAAP net loss of approximately $77 million, which decreased from the prior estimate of $80 million. And it does not include any income or expense related to the outstanding warrants issued to temp.

Aaron L. Tachibana: Revenue from apartment test enterprise sales and other customers in the range of <unk> $68 million to $70 million.

Aaron L. Tachibana: <unk> increased from the prior estimate of $65 million to $67 million.

Aaron L. Tachibana: Population sequencing revenue to be approximately $8 million.

Aaron L. Tachibana: non-GAAP net loss of approximately $77 million, which decreased from the prior estimate of $80 million.

Aaron L. Tachibana: And it does not include any income or expense related to the outstanding warrants issued to tempus.

Aaron L. Tachibana: And cash usage is expected to be approximately $62 million. We look forward to updating you on our progress during the next conference call in a few months. And with that, I will turn the call back over to the operator to begin the Q&A session. Operator? Thank you.

Aaron L. Tachibana: And cash usage is expected to be approximately $62 million.

Aaron L. Tachibana: We look forward to updating you on our progress during the next conference call in a few months and with that I will turn the call back over to the operator to begin the Q&A session.

Operator: Thank you. We will now begin the question and answer session. To ask a question, you may press star and then one on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the key. If at any time your question has been answered and you would like to withdraw your question, please press star then 2. Please limit yourself to one question and one follow-up. At this time, we will pause momentarily to assemble our roster. The first question comes from Yuko Oku of Morgan Stanley. Please go ahead.

Speaker Change: Thank you operator, we will now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone if youre using a speakerphone. Please pick up your handset before pressing the keys.

Yuko Oku: If at any time. Your question has been addressed and you would like to withdraw your question. Please press Star then two.

Yuko Oku: These limit yourself to one question and one follow up.

Yuko Oku: At this time, we will pause momentarily to assemble our roster.

Yuko Oku: The first question comes from Hugo <unk> with Morgan Stanley. Please go ahead.

Madison Patricia: Hi, team. This is Madison on for Yuku.

Operator: Hi team. This is Madison on for you to congrats on the quarter. Thanks for taking the question.

Madison Patricia: Congratulations on the quarter. Thanks for taking the questions. I just want to start out with the finalization of the FDA's LDT regulation. I was just wondering if you could speak to your strategy in adhering to the requirements and what kind of implications for Personalis you're expecting with respect to Next CX and Next Personal. Yeah, awesome.

Madison Patricia: Just wanted to start out with the final version of that.

Madison Patricia: T regulation I was wondering if the speaker.

Speaker Change: Do you have your own team or their requirements.

Madison Patricia: And what kind of implications for personnel personnel that you're expecting with respect to personnel.

Christopher M. Hall: Yeah, awesome. Great. Thanks. Thanks for being on Madison.

Speaker Change: Awesome, great. Thanks, Thanks for being on Madison.

Christopher M. Hall: Yes, the FDA issued its final guidance for regulations, and overall, we perceive it to be good for the industry, certainly good for Personalis. We have a quality management system here that we think is super robust. We're regularly inspected by most of the large biopharma companies. We've been operating with ISO certification, New York, etc., and we think that what we're doing sort of fits in well with what the agency expects based on the guidance.

Speaker Change: Yes, the FDA issue there.

Christopher M. Hall: Final guidance for regulations and.

Christopher M. Hall: And overall, we we perceived it to be good for the industry certainly good for personality.

Christopher M. Hall: We even have a quality management system here that we think is super robust. We're regularly inspected by most of all the large biopharma companies are we've been operating with with ISO certification in New York et cetera, and we think that what we're doing sort of fits in well with what the agents do you expect based on the guidance.

Christopher M. Hall: And so we feel like we're set up well, and we think, ultimately, it's good for us. We should note that, you know, there was a grandfathering section around having an LDT live. We have Both of those tests are laboratory-developed tests and are both on the market as of the effective date of the FDA guidance, so we think that's good. And secondarily, because of our long relationship with New York and having New York certification, we submitted both of the tests for New York approval. And so, ultimately, we expect to have New York approval for both of the tests also. So we think it's, it's net net a positive for Personalis and puts

Christopher M. Hall: So we feel like where we're set up well and we think ultimately it's good for US well note that you know there was a grandfathering section around having an LTV she lives.

Christopher M. Hall: We have both of those tests are laboratory developed test and are bullish.

Christopher M. Hall: Are both both on the market as of the effective date of the FDA guidance. So we think that's good.

Christopher M. Hall: Secondarily cause.

Christopher M. Hall: Our long relationship with New York.

Christopher M. Hall: And having New York certification, we submitted both.

Christopher M. Hall: The test for New York.

Christopher M. Hall: New York approval and so ultimately we expect to have New York recruitment for both test also so we think it's net net a positive for personnel Alison puts us in a good position.

Madison Patricia: Got it. Okay, that's good to hear. And then just one follow-up question. Following the recent ADCOM meeting to evaluate MRD as an endpoint in multiple melanoma trials, just wondering if you see any reach to the solid tumor space and, specifically, with the panel emphasizing sensitivity, what is your next personal position for capturing clinical trial opportunity?

Speaker Change: Got it okay. That's helpful. Yeah.

Christopher M. Hall: Yeah.

Madison Patricia:

Madison Patricia: And then just one follow up on them with pharma and everything icon meeting you evaluate MRV in endpoint.

Madison Patricia: Couple of melanoma trial I was wondering if you see any REIT.

Madison Patricia: Sorry, Alex you were speaking specifically with empathy.

Madison Patricia: Emphasizing from sensitivity how do you see.

Madison Patricia: First I'll focus on for Capstone clinical tie opportunity.

Christopher M. Hall: Yeah, yeah, and I would just note one of the things I think these two dovetail together: there is, I mean, clearly what the agency did with the unanimous approval of using that and multiple myeloma as blood-based; we expect this to continue to march in solid tumors. And I think that the guidance and having the LDT and the quality management systems, et cetera, is going to make it harder for companies that aren't well-funded, ultimately, to build and get the kind of position in the space that they would need to do.

Madison Patricia: Yeah, Yeah, and I would just note I mean, one of the one of the things I think these two dovetail together there is I mean, clearly what the agency debt.

Christopher M. Hall: With the unanimous approval of using that.

Christopher M. Hall: Multiple myeloma is a blood based we expect this to continue the March in solid tumor.

Christopher M. Hall: And I think that the the guidance and having the L. D T in their quality management systems et cetera, it's going to make it harder for companies that are well funded to ultimately to build to get to kind of position in the space that you would need to do so I think it's sort of works it works together well, especially if you.

Christopher M. Hall: So I think it sort of works, it works together well, especially if you, if you, if you appreciate that the FDA is going to integrate ctDNA as a monitoring metric for these clinical trials. Doing that could allow biopharma companies to have results sooner and, ultimately, speed up access to drugs for patients. We're engaged with most of the top biopharma companies right now that are either using the technology, assessing the technology, or, or, or, or doing pilots or bake-offs.

Christopher M. Hall: If you if you appreciate that our FTE.

Christopher M. Hall: The FDA is going to integrate we believe at some point see T. DNA is monitoring metrics in these clinical trials doing that can allow biopharma companies to resolve results sooner and ultimately speed up access to drugs for patients. We're engaged with most of the most of the top biopharma companies right.

Christopher M. Hall: Now that are either using the technology, assessing the technology or or or or doing pilots or bank costs and there's always a long sales cycle with biopharma with these with these products, but but the ultra sensitive nature allows them. We believe in what we're starting to see in the data that we're both Tom.

Christopher M. Hall: And there's always a long sales cycle with biopharma with these, with these products, but, but the ultra-sensitive nature allows them, we believe, and what we're starting to see in the data that we're both talking about at industry scientific gatherings and what we're starting to see in our early testing data is that we're seeing, you know, almost 40% of the positive results are in the ultra-sensitive range, and those are real patients that And that insight and that discrimination is appealing to biopharma companies that want to have that discrimination in their clinical trials, and they want to make sure that if they use a test as an entry point to actually take the drug and go in the two arms. They want to make sure that the patients that are most likely to recur ultimately enter the trial, and so we're getting really positive feedback on the assay in that way.

Christopher M. Hall: About at industry.

Christopher M. Hall: Scientific gatherings and what we're starting to see in our early testing data is that we're seeing you know almost 40% of the positive results from the ultra sensitive range and those are those are real patients that were identifying cancer sooner and that insight and that discrimination is appealing to biopharma companies, who want to have that discrimination in their clinical trials and they wanted to make sure if they use.

Christopher M. Hall: The test is an entry point to actually take the drug and go into two arms. They wanted to make sure that the patients that are most likely to recur ultimately enter the trial and so we're getting really positive feedback on.

Christopher M. Hall: On the assay and that way too.

Madison Patricia: Got it. That's good to hear. Thanks so much for taking the question. Awesome. Thanks for being on Madison.

Speaker Change: Got it that's good to hear thanks, so much for taking the questions.

Speaker Change: Awesome, Thanks for being on medicine.

Operator: The next question comes from Mark Massaro with BTIG. Please go ahead.

Madison Patricia: The next question comes from Mark Massaro with BTG. Please go ahead.

Vivian: Hey guys, this is Vivian on behalf of Mark. Thanks for taking the question. So just as far as the ways to guidance beyond the beat, you have a number of offerings, some of which are newer, like Next Personal, which might not be driving revenue yet versus some more mature partnerships like Moderna. So looking to 24, just curious if there's any area in particular where you're expecting to see strength versus some product lines that might be softer. Thanks.

Operator: This is Danny on for Mike Thanks for taking the question.

Vivian: Finds their way to the filings and beyond would be.

Speaker Change: [noise] of offering from a switching you or that next person at all.

Speaker Change: She might not be driving revenue.

Vivian: With the more mature partnerships like Mcdonough.

Speaker Change: Looking at 'twenty four I'm just curious.

Vivian: And particular, we expecting to see strength and some product lines that might be softer.

Aaron L. Tachibana: Hi Vivian, this is Aaron. Thank you for the question and being on the call. In terms of the guidance... You know, we raise guidance primarily because of the stress.

Vivian: Hi, Vivien. This is Aaron Thank you for the question and being on <unk> in terms of the guidance.

Aaron: So we raised guidance, primarily because of the strength.

Aaron L. Tachibana: of BioPharma Demand. In terms of where that strength is coming from, so ImmunoID Next is holding its own.

Aaron: Biopharma demand.

Aaron: In terms of where that strength is coming from so immuno <unk> is holding its own doing very very well, we have a lot of pharma headwinds today, but in terms of the opportunity. It's really next personal.

Aaron L. Tachibana: It's doing very, very well. We have a lot of pharma headwinds today, but in terms of the opportunity, it's really Next Personal. We've done really well in the first quarter with NexPersonal. We have a tremendous funnel that's building. And we see that growth is going to accelerate as we head through the back half of 2024 with NexPersonal. In addition, you know, Chris mentioned in his prepared remarks that we are seeing strength from the personalized cancer vaccine side of the business as well. And that's, again, on our ImmunoID NexPlatform.

Aaron L. Tachibana: We've done really well in the first quarter with <unk> personal and we have a tremendous funnel that's building.

Aaron L. Tachibana: And we see that the growth is going to accelerate as we head through the back half of 2024 with a next personal in addition.

Aaron L. Tachibana: Chris mentioned in the prepared remarks that we are seeing strength from the personalized cancer vaccine side of the business as well.

Aaron L. Tachibana: That's again off of our immuno.

Aaron L. Tachibana: Next platform.

Aaron L. Tachibana: Okay.

Aaron L. Tachibana: Okay, perfect. Yeah, and that kind of dovetails into my next question. So the 338 next personal test was great to see just how you're expecting that to ramp throughout the year after Tempest starts marketing it as well. And just wanted to get a sense if reimbursement on that test would be more of a 2025 event or if there was any updated timing there. Thanks.

Speaker Change: Okay perfect.

Aaron L. Tachibana: That kind of dovetails into my next question. So this to.

Aaron L. Tachibana: <unk> 38.

Speaker Change: And I'll pass it was great to see.

Aaron L. Tachibana: We're expecting that to ramp throughout the year after campus start marketing it as well.

Aaron L. Tachibana: Next we'll go to some of the reimbursement on that cost would be more of a 2025 is that correct.

Christopher M. Hall: Now, I mean, our goal this year is to submit the data for all three cancer indications and stitch it all together, and we think that the data is coming together to allow us to do that. We talked in the prepared remarks that the VHIO and the Royal Marston data would be featured at ASCO, you know, as a podium presentation, which we think is great, and we're tracking to be able to get the data ultimately submitted for publication, published, and to be able to submit across the three indications for coverage in 2024, which is our stated goal.

Aaron L. Tachibana: No I mean, our goal this year is to submit the share for all three cancer indications.

Christopher M. Hall: And stitch it together and we think that the data is coming together to allow us to do that we talked in the prepared remarks that the V. H I O in the Royal Marsden data would be feature and at <unk>.

Christopher M. Hall: As a podium presentation, which we think is.

Christopher M. Hall: This is great.

Christopher M. Hall: And we're tracking to be able to get data ultimately submitted for publication published to be able to to.

Christopher M. Hall: Would you be able to submit across the three indications.

Christopher M. Hall: Reach in 2024, which is <unk>, which is our stated goal now that's aggressive.

Christopher M. Hall: Now, that's aggressive, and we'll continue to grow the number of doctors that are in the EAP through our own efforts, slowly through our own efforts, and then with Tempest. And so we'll see the number of patients referred to us for next personal testing continue to grow through the year.

Christopher M. Hall: And we will continue to grow the number of doctors.

Christopher M. Hall: That are in the EAP through our own efforts slow late through our own efforts and then with Tempus and so we'll see the number of patients referred to US for next personal testing continued to grow through the year maybe.

Aaron L. Tachibana: Maybe just an add-on to what Chris just articulated, Vivian, so we're seeing great strength, we have a lot of demand from doctors wanting to participate in the program, the number of tests is continuing to grow, but there's a balance. We're going to be a little bit careful with how much we take and perform tests on, primarily because of reimbursement. We don't want to just burn a lot of cash. We want to make sure we learn, we want to scale, but also there's a cash component.

Speaker Change: And maybe just an add on to what Chris just articulated again, so we're seeing great strength, we have a lot of demand with doctors wanting to participate in the program number of tests are continuing to grow but theres a balance we're gonna be a little bit careful with how much we take them perform tests done primarily because of reimbursement, but we don't want to just burn a lot of <unk>.

Aaron L. Tachibana: Cash we want to make sure we learn and we want to ramp but also there's a cash component of it.

Christopher M. Hall: Perfect. One of the questions. Yeah, one of the questions.

Aaron L. Tachibana: Perfect and one of the question.

Christopher M. Hall: Yeah, one of the neat things about this relative to volume growth, from an investor's standpoint, it's always been appealing about the MRD market is there's always an annuity, right? As you build the first baseline test, you repeat tests over time as this patient sort goes through their cancer journey. There's continued, continued testing, often a personalized genetic fingerprint that you create for the patient. And so we're seeing that happen. We're seeing nice growth in the repeat tests of the patients that we that were referred to us previously, which is, which is a really great dynamic in the space.

Speaker Change: Yes, one of the one of the neat things about this relative to volume growth.

Christopher M. Hall: I'm, an investor standpoint, it's always been appealing about the D market is there's always an annuity right issue as you build the first baseline tests you repeat test over over time as patients sort of.

Christopher M. Hall: Go through their cancer journey.

Christopher M. Hall: Continued continued testing all personalized.

Christopher M. Hall: Genetic fingerprint that you've created for the patient and so we're seeing that happen.

Christopher M. Hall: Seeing nice growth in our repeat test of the patients that we have.

Christopher M. Hall: Were referred to us previously.

Christopher M. Hall: Which is a really great dynamic.

Christopher M. Hall: In this space.

Speaker Change: Awesome. Thanks, guys.

Christopher M. Hall: Contributing.

Operator: The next question comes from Dan Brennan with T.D. Cohen. Please go ahead.

Christopher M. Hall: The next question comes from Dan Brennan with TD Cowen. Please go ahead.

Joe: Hey, Joe, I'm for Dan. Thanks for taking them. Um, I just got a little bit more on the 330 MRT test. What do you need to see to open that waitlist up to the 250 doctors that you mentioned in Q4? Is that more capacity or demand? Or is it really just holding back tests until they get more widespread reimbursement? And maybe there is some sort of cap you're thinking about for annual volumes before you get coverage on the three tests?

Operator: Spade, Joe on for Dan Thanks for taking them.

Joe: I, just got a little bit more on the 330 <unk> test.

Joe: What do you need to see to open that way the substitute 50 docs that you mentioned in Q4 or is that more capacity or demand or is it really just holding back test until you get more widespread reimbursement then maybe is there like some sort of cap you're thinking about for annual volumes before you get coverage on the three tests.

Christopher M. Hall: Yeah, the latter. We're, we're moving really slow. Because of reimbursement. And one of the things I think it's obvious by looking at all the progress that we've made through 2023 and bringing down the burn rate of the company, extending the cash out of the company, is that we're being very thoughtful about where and how we spend the resources that we have. And so it's really important through this journey that we build advocates for the products, that we continue to build clinical evidence, that we continue to learn the right way to position and talk about the products, and that we test the relationship with Tempus.

Speaker Change: Yes, the latter.

Speaker Change: We're moving really slow.

Christopher M. Hall: Because of reimbursement.

Christopher M. Hall: And one of the one of the.

Christopher M. Hall: I think it's obvious by looking at all of the progress that we've made through 2023 at bringing down the burn rate at a company extending the cash out of the company is that we're being very thoughtful about where and how we spend it.

Christopher M. Hall: Sources that we have and so it's really important through this journey that we build advocates for the products that we continue to build clinical evidence that we continue to learn the right way to position talk about the products that we test the relationship with with Tempus that'd be really.

Christopher M. Hall: And we really got to the point where we feel confident that once we get reimbursement, we can pull the trigger and go super fast. But until we get reimbursement, we're not planning on going super fast because we don't get paid for those samples, and we want to make sure that we're really thoughtful in doing the right thing with investors.

Christopher M. Hall: Get to the point, where we felt confident that once we get reimbursement, we can pull the trigger and go Super fast.

Christopher M. Hall: But until we get reimbursement and we're not planning on going Super fast because it's.

Christopher M. Hall: Paid for those samples.

Christopher M. Hall: We want to make sure that we're really thoughtful and doing the right thing but.

Christopher M. Hall: Okay.

Joe: Got it. And then on the burn, does the two years of cash assume a revenue level of like at or around 100 million now that you've implemented your 100 million in 2025 framework? Or is it closer to, like, a bit lower?

Speaker Change: Got it and then on the burn does it two years of cash sooner rather than revenue level like at or around $100 million now that you've implemented.

Joe: Twenty-five framework or is it closer to like a puzzle and start a bit lower.

Aaron L. Tachibana: Hi Joe. Yeah, so in terms of the burn, we've mentioned the cash will last through the end of the first quarter of 2026. So it does contemplate something that's close to that $100 million range in 2020.

Speaker Change: Hi, Joe.

Joe: In terms of the burn we've mentioned the cash will last us through the end of the first quarter of 2026.

Aaron L. Tachibana: So it does contemplate something that's close to that $100 million range in 2025.

Joe: Got it. And then just last, on the patents, is the core IP that you're forcing specific to whole genome sequencing in solid tumors, or are there other key aspects of IP that? I'm signing out.

Speaker Change: Got it and then just last on the pattern is.

Joe: Is the core IP that you have a poor thing specific to whole genome sequencing for tumor solid tumor or are there other key aspects of IP that.

Christopher M. Hall: I mean, relative to MRD, very broad, both MRD and PCV very broad, both around the whole genome, and then the way in which we do the process. And then there's the IP that was mentioned around the exome and the way we boost the exome relative to its use in PCV.

Joe: Pentagon relative relative to M. R D very broad or both of them are dnp's you'd be very broad.

Christopher M. Hall: Most around whole genome and then the way in which we by the way in which we do the process.

Christopher M. Hall: Then there is IP that was mentioned around the <unk> and the way we boosted exome.

Christopher M. Hall: Relative to its use in PCB.

Christopher M. Hall: And the point I've mentioned is just underlying because we spend a lot of time, and significant energy building the protections around what we're doing. And, you know, we continue to make progress. And we've been mostly focused on driving the business really aggressively towards MRD, but we wanted to make sure we underlined that there's a deep amount of IP here that we think is building, getting stronger, and that we continue to work on evolving and extending as we invest in R&D. And so, you know, we had some successes in the quarter; we wanted to underline that as part of our ongoing efforts.

Christopher M. Hall: And the point that Ive mentioned it.

Christopher M. Hall: Just to underline because we spend a lot of time significant energy building that.

Christopher M. Hall: The protections around what we're doing and we continue to make progress and we've been mostly focused on driving the business really aggressively towards M. R. D. But we wanted to make sure. We underline that there is a deep amount of IP here.

Christopher M. Hall: Zinc is.

Christopher M. Hall: <unk> is building and getting stronger and we continue to work on.

Christopher M. Hall: Evolving and extending as we as we invest in R&D and so we had some success this quarter we wanted to.

Christopher M. Hall: Part of our ongoing journey.

Christopher M. Hall: Oh thanks.

Speaker Change: Thanks, Joe.

Operator: The next question comes from Thomas Flayton on Lake Street. Please go ahead.

Christopher M. Hall: The next question comes from Thomas Flaten with Lake Street. Please go ahead.

Thomas Flayton: Good afternoon, guys. I appreciate you taking the questions. I just want to clarify something about the TracerX collaboration. The publication that you'll use for your reimbursement dossier, will that be the initial ESMO cohort, or will that be a publication covering the full cohort, which we expect to see a readout on later this year?

Thomas Flayton: Hey, good afternoon, guys I appreciate you taking the questions I just wanted to clarify something with the tracer ex collaboration the the publication that you will use for your reimbursement dossier will that be the initial ESMO cohort or would that be a publication covering the full cohort, which we expect to see a readout on later this year.

Richard Chen: Thomas Rich is with us, so he's going to take that one. Great, Thomas. Thanks for your question. The publication that will support our reimbursement will be the second publication that is.

Speaker Change: Yeah, Thomas Rich's as well.

Thomas Rich: With us so he is going to take that one hi, Thomas Thanks for your question.

Speaker Change: So E. The.

Thomas Rich: The publication that will support our reimbursement will be the second publication is that until the entire cohort.

Richard Chen: So that we're targeting kind of later this year, and the first publication will come out, but it's only a subset of the data that we need.

Thomas Rich: So that we're targeting for kind of later this year.

Richard Chen: And first of all I'd publication will come out, but it's only a subset of the data that we need.

Speaker Change: Got it.

Thomas Flayton: And then Chris, I want to make sure I didn't misunderstand what you said. But did you say that the Natera relationship would persist into 2025? Or did I misunderstand that? Now, I just said that we have a great working relationship.

Speaker Change: And then Chris I wanted to make sure I didn't misunderstand, what you said, but did you did you say that the taro relationship would persist into 2025 or did I misunderstand that.

Christopher M. Hall: No, I just said that we have a great working relationship and we're optimistic that it will that we will continue to work with them. We have not done anything.

Thomas Flayton: Said that we have a great working relationship and we're optimistic.

Christopher M. Hall: Well that we will continue to work with them into 2025.

Christopher M. Hall: Okay.

Christopher M. Hall: Yeah.

Christopher M. Hall: Okay.

Speaker Change: Got it.

Christopher M. Hall: And if I could just add a third one. Have you discussed this with Tempest, and maybe they haven't an alternate solution of adding next DX? It strikes me that being able to order both tests through one through one sales channel would make sense. But how are you thinking about those two tests working in synergy with each other long term?

Speaker Change: And if I could just add at a third one.

Christopher M. Hall: Have you discussed with Tempus and maybe they havent been ultra solution of adding next Dx. It strikes me that being able to order both tests through one through one sales channel would make sense, but how are you thinking about those two tests working in synergy with each other long term.

Christopher M. Hall: Yeah, so, um, with We are seeing next year, being ordered with, personal and our early access client.

Christopher M. Hall: Yeah. So.

Christopher M. Hall: With <unk>.

Christopher M. Hall: We are seeing next Dx being ordered with next personal in our early access clients.

Christopher M. Hall: And that demand is strong. What we're seeing in the marketplace, and I think everyone is seeing in the marketplace, is that the power of the MRD testing is unique and differentiated, and the CGP testing physicians are seeing more in a way that they're more interchangeable, and so they're ordering the CGP test paired with the MRD as a convenience play. Same patient, same tissues, same et cetera. And so we're certainly. Tempest has their own MRD test, and so through the samples, not the MRD test, their own CGP test, excuse me, and so they will be, they'll be providing that now, like they do with their customers. And so we expect the next DX, our approach to only come through with the doctors that we sell ourselves.

Christopher M. Hall: And that demand is strong what we're seeing in the marketplace and I think everyone has seen in the marketplace is that the power of the M. R&D testing is unique differentiated and the CGP testing physicians are seen more in a way that they are more interchangeable and so theyre Arab there they're ordering.

Thomas Flayton: Got it. Appreciate you taking the time to ask the question. Thank you.

Thomas Flayton: CGP test paired with the <unk> as a convenience play same patient same tissues same et cetera.

Thomas Flayton: So we're certainly seeing that.

Thomas Flayton: Tempus has their own M R&D test and so through the samples not MRV test their own CGP tests excuse me and so they will be.

Thomas Flayton: There'll be still be providing that now I'd like to do with their customers and so we expect next Dx our approach to only come through with the doctors that we sell ourselves.

Speaker Change: Got it I appreciate you taking the question. Thank you.

Operator: The next question comes from Mike Matson with Needham. Please go ahead.

Thomas Flayton: The next question comes from Mike Matson with Needham. Please go ahead.

Joseph Scott Conway: Hey, Chris here, and this is Joseph on for Mike. Maybe just one on pharma demand. Obviously, as you guys said, it's seen increasing demand there. But is that mainly coming from, I guess, new customers coming back in, or is more existing customers kind of expanding their order books?

Operator: Hey, Chris here and this is Joseph on for Mike.

Joseph: Maybe just one on pharma demand.

Joseph Scott Conway: Obviously as you guys said they've seen an increase in demand there is that mainly coming from.

Joseph Scott Conway: I guess, new customers coming back in or is more existing customers expanding their order books.

Aaron L. Tachibana: Mostly the similar customers that we've had up to now, so they're not really new customers. It's just the expansion of the order book and the opportunity.

Joseph: Mainly this similar customers that we've had up to now so it's not really new customers just the expansion of the order book and the opportunity in addition.

Speaker Change: The majority of relationship has been strong in that business is starting to increase as well.

Christopher M. Hall: I mean, and the next person, I mean, we basically have, you know, the new use of immuno ID and PCV is really starting to accelerate as Mark and Madonna enroll patients in their clinical trials, and then X personal is a new product in the biopharma, you know, starting to grow. And so those two things are really starting to add wins to our sales.

Aaron L. Tachibana: And then you've got personal I mean, we basically have.

Christopher M. Hall: The new the use of immuno I D. N. P. C V is really starting to accelerate as our can Madonna and where all of the patients in their clinical trials and then ex personnel being a new product in the Biopharma is starting to grow and so those two things are really starting to put wins to ourselves relative to financial performance.

Christopher M. Hall: <unk>.

Joseph Scott Conway: Yeah, okay, gotcha. And then maybe just in there for the early access program for next personal. I guess, do you have an engagement rate for those using, you know, next DX? And then, I guess, was that a full quarter?

Speaker Change: Yeah, Okay Gotcha.

Christopher M. Hall:

Joseph Scott Conway: And then maybe just a in there for the early access program for next personal.

Joseph Scott Conway: I guess do you have a I guess an engagement rate for those using next Dx and then I guess was that a full quarter that you you guys kind of launched next Dx.

Joseph Scott Conway: Yeah.

Christopher M. Hall: Yeah, so next DX we launched Dr. Michael Matson, Swayampakula Ramakanth, Yuko Oku, Richard Chen, Charlie Swanton, Chris, or, you know, the next DX, the CGP product being used with the MRD product side by side. And I think, I mean, I'll have to check, but the adoption's been wide across the entire 10 people in the EAP program. I don't know if I can say they've all done that, but certainly...

Joseph Scott Conway: Yeah. So next Dx, we so next Dx we launched.

Christopher M. Hall: I would say year and a half ago.

Christopher M. Hall: We kept it very very very small you know and it was and it was used by a few physicians when we launched next personalized and L. D. T Laboratory developed test in October that's when we started to see next person will be used side by side with.

Christopher M. Hall: The next day next Dx.

Christopher M. Hall: G P product be used with the <unk> product side by side and I think I mean, I have to check, but the adoptions and wide across the entire 10 people in the EAP program I don't know if I can say, they're all done that but certainly.

Christopher M. Hall: This significant majority, most of them.

Christopher M. Hall: Significant majority most of them have been using next Dx at the same time that they use X personnel.

Christopher M. Hall: the same time that they use the next person.

Joseph Scott Conway: Okay, and then maybe one last one for the molecular or, I guess, for the positions in the quarter. For the test, is there an average test per patient that you guys are seeing?

Speaker Change: Okay, and then just maybe one last one.

Joseph Scott Conway: For the molecular or I guess for the physicians in the quarter.

Joseph Scott Conway:

Joseph Scott Conway: I guess.

Joseph Scott Conway: The test is there an average test per patient that you guys are seeing.

Christopher M. Hall: I don't think we have enough time to do, to, I think we need more time to pass about an average test per patient because I think a lot of these people are new.

Speaker Change: I don't think we have enough time to two I think we need more time to pass about an average time for patients.

Christopher M. Hall: Cause I think a lot of these people are new.

Christopher M. Hall: But we are starting to see repeat testing. And in fact, you know, because when you're fixed at 10 physicians, a lot of times in these hyper growth modes, and these companies' launches, you're also starting to really sign up a lot of new doctors. And so your V1s are always growing at a dramatic rate because you're growing more doctors. In the world where we fix the doctors, we've launched into the rhythm and beat of getting the clinical samples coming from those doctors.

Christopher M. Hall: But we are starting to see that repeat testing and in fact, because when you are fixed at 10 physicians a lot of times in these hyper growth mode and these companies launches.

Christopher M. Hall: Youre also youre starting to really sign up a lot of new doctors and so your V ones are always growing at a dramatic rate because you're growing many of our doctors in the world, where we fixed the doctors want to launch into a rhythm and beat up getting the clinical samples coming from those doctors now we've hit the point, where the repeat testing is starting to outpace the week.

Christopher M. Hall: Now we've hit the point where repeat testing is starting to outpace the weekly new tests coming in, right? Just because it's starting to accelerate. So we'll, we'll, we'll come up with a way that we ultimately talk about that metric. But I don't think we have any insight right now, relative to the number of tests per patient. But I think as we get a year or two years in the rear view mirror, it'd be a good way to start.

Christopher M. Hall: <unk> new tests coming in right.

Christopher M. Hall: Just because it's starting to accelerate so well well well come up with a way that we ultimately talk about that metric, but I don't think we have any on site right now.

Christopher M. Hall: Well relative relative to the number of tests per patient, but I think as we get a year two years in the rearview mirror, if you could wait to start.

Joseph Scott Conway: Gotcha. Okay. Yeah, thank you very much for taking our questions and congratulations on the quarter.

Speaker Change: Got you Okay. Yeah. Thank you very much for taking our questions and congrats on the quarter.

Christopher M. Hall: Thanks for being on.

Speaker Change: Yeah. Thanks, Thanks for being on.

Operator: The next question comes from Arthur He with HC Rainwright. Please go ahead.

Christopher M. Hall: The next question comes from Arthur he.

Arthur He: With H C. Wainwright. Please go ahead.

Oscar: Hi, Chris and Aaron. This is Oscar on 4RK. So I guess I just want to get a quick question regarding the early access program for the personal DX. For that program, I know you mentioned a doctor on the waiting list at the beginning. I'm just curious, is there...

Arthur He: Hi, Good afternoon, a question Erin.

Oscar: Okay. So I guess I just wanted to get a quick question regarding the early access.

Oscar: Program for the personal Dx.

Oscar: Hum.

Oscar:

Oscar: We will fund these programs for I know you mentioned is a doctor on the waiting list.

Oscar: Beginning.

Oscar: I'm just curious is deal is there any more doctors getting on the waitlist the game longer and there was lost.

Christopher M. Hall: Well, there was growth there. Yeah, we were there. There's been growth and on the waiting list. We just decided we're not going to like track that quarter over quarter. We thought that the reported test was the best way to sort of provide insight. But we do have a waitlist, and then Tempest is starting their discussions, and so we expect there to be a pent-up demand that they're creating too, separately as they engage with it.

Oscar: There was growth there yeah, we were there there's been growth and what the waiting list. We just decided we're not going to track.

Christopher M. Hall: Track that.

Christopher M. Hall: Quarter over quarter, we thought that the.

Christopher M. Hall: Ported test was the best way to provide to provide insight, but we do have a wait list.

Christopher M. Hall: And then tempus is starting their discussions and so we expect there to be a pent up demand that they're creating two.

Christopher M. Hall: Separately as they engage with.

Christopher M. Hall: But customers in discussions.

Oscar: Got you. Thanks for the additional color.

Speaker Change: Got you, thanks for those who shouldn't color and rigs.

Oscar: Regarding the reimburse application.

Christopher M. Hall: And regarding the reimbursement application. You guys mentioned the aim of trying to get all three indications done this year. Besides the data package you prepared for that, what are other things you guys prepared that could increase the chance of getting the reimbursement approved? Yeah, great question.

Oscar: You guys mentioned the aim for the I'm trying to get to the four or three indication down this year.

Christopher M. Hall: Besides the data package are you prepared for that what other things you guys prepared to can increase the chance for getting the reimbursement approved yeah. Great question. So the key thing is the data package now.

Christopher M. Hall: Yeah, great question. So the key thing is the data package. Now, you know, one of the things that happened to us earlier in this quarter is that the analytic analytical validation data, which looked really, really strong, was published. And that is the backbone of every one of the submissions, that the test gives an answer across multiple cancer types down to one part per million. It does that with really high accuracy.

Christopher M. Hall: Now you know one of the one of the things that you know we happened to US earlier in this quarter is that we the analytics analytical validation data, which looked really really strong was published and that is that is the backbone of every one of the submissions that the test gives an answer across multi.

Christopher M. Hall: All cancer types.

Christopher M. Hall: The one part per million and thought that was really high specificity and so that that's like the backbone of every submission whenever you do this analytic validation data and this was really strong really robust and.

Christopher M. Hall: And so that's like the backbone of every submission whenever you do this, the analytic validation data. This was really strong, really robust, and a lot of studies, a lot of work that went into it. We're really proud of it and super excited that it got published so quickly.

Christopher M. Hall: A lot of studies a lot of work that went into it and we're really proud of it and Super excited that it got published so quickly. So that's sort of the backbone of all three and then we have to get job we have to.

Christopher M. Hall: So that's sort of the backbone of all three. And then we have to get clinical data for each one of these three. So, you know, for lung cancer, early stage lung cancer, the work with Tracer X is key there. For breast cancer, the work with Roa Marston is key there because there are multiple subtypes. But we're also working with Dana Farber and Kundari, triple negative breast cancer patients.

Christopher M. Hall: To get clinical data and each one of these three so you know for <unk> for lung cancer early stage lung cancer. The work with tracer acts as key there with breast cancer that work with the Royal Marsden is key there because that's multiple subtypes, but we're also working with Dana Farber, we're working with Mr. Dart.

Christopher M. Hall: Triple negative breast cancer patients, we have our own program.

Christopher M. Hall: We have our own; we have a clinical trial we're doing ourselves called Be Stronger. In immunotherapy, we've got the UKE data with melanoma, we've got the Duke data with gastric patients, and then we've got the large VHIO data.

Christopher M. Hall: Clinical trial, we're doing ourselves called stronger.

Christopher M. Hall: Immunotherapy, we've got the U K data.

Christopher M. Hall: With melanoma, we've got to do data with cash cash gastric patients.

Christopher M. Hall: And then we've got the large China data and so we continue to make progress running those samples. The key thing there is that collaborators will need to write the articles and <unk>.

Christopher M. Hall: And so, we continue to make progress running those samples. The key thing there is that collaborators will need to write the articles, and they have to submit those articles. And those articles have to be accepted ultimately for us to, for us to, for us to drive the submission. And so the one piece of this that is always difficult to predict is, you know, how long it takes collaborators to write articles and to submit articles, and ultimately for those articles to get accepted. But we've been very focused on driving this so that all that comes together this year, and that's been our goal, and right now, we're on track to accomplish that.

Oscar: Awesome, thanks for taking my question and congrats on the progress.

Oscar: You have to submit those articles and those articles have to be ultimately be accepted for us too.

Oscar: For us to for us to drive the submissions and so the one piece of this that is always difficult to predict as you know how long it takes collaborators too right.

Oscar: Bright articles and to submit articles and ultimately for those articles to get.

Oscar: Articles to be to be accepted.

Oscar: But we've been very focused on driving that so that all that comes together this year and that's been that's been our goal and right now we're on plan to accomplish that.

Oscar: Awesome. Thanks for taking my question and congrats on the progress.

Speaker Change: Awesome, Thanks, a lot.

Operator: This concludes our question and answer session as well as the conference. Thank you for attending today's presentation. You may now disconnect. Thanks. Goodbye.

Christopher M. Hall: Awesome, thanks. All right. This concludes our question and answer session, as well.

Speaker Change: This concludes our question and answer session as well as conference. Thank you for attending today's presentation. You may now disconnect.

Christopher M. Hall: Thanks.

Christopher M. Hall: Goodbye.

Christopher M. Hall: Okay.

unknown: Swayampakula Ramakanth, Yuko Oku, Richard Chen, Charlie Swanton, Chris Arnone, Madison Arnone, Madison Patricia, Personalis Swayampakula Ramakanth, Yuko Oku, Richard Chen, Charlie Swanton, Chris Arnone, Madison Patricia

Christopher M. Hall: [music].

unknown: Yeah.

unknown: Yeah.