Q1 2024 Lucid Diagnostics Inc Earnings Call
Okay.
Speaker Change: Good morning, and welcome to the lucid diagnostics first quarter, 'twenty, 'twenty, four and business update conference call.
Speaker Change: At this time all lines are in listen only mode.
Speaker Change: Following the presentation, we will conduct a question and answer session.
Speaker Change: If at any time during this call you require immediate assistance. Please press star zero for the operator.
Speaker Change: Please note this event is being recorded.
Speaker Change: I would now like to turn the conference over to Matt Riley Lucid diagnostics director of Investor Relations. Please go ahead.
Matt Riley: Thank you operator, and good morning, everyone. Thank you for participating todays business update call. Joining me today on the call our doctor at least on a Cogs Chairman and Chief Executive Officer of Lucid diagnostics, along with Dennis Mcgrath Chief financial officers Lucid diagnostics.
Speaker Change: The press release announcing our business update and financial results is available on <unk> website. Please take a moment to read the disclaimers about forward looking statements in the press release.
Speaker Change: The business update press release and conference call include forward looking statements and these forward looking statements are subject to known and unknown risks uncertainties that may cause actual results to differ materially from statements made.
Speaker Change: Factors that could cause actual results to differ are described in the disclaimer and in our filings with the Securities and Exchange Commission.
Speaker Change: For a list and a description of these and other important risks and uncertainties that may affect future operations see part one item one a entitled risk factors and released its most recent annual report on forms 10-K filed with the SEC and any subsequent updates filed in quarterly reports on forms 10-Q, and subsequent forms 8-K.
Speaker Change: Except as required by law looser disclaims any intentions or obligations to publicly update or revise any forward looking statements to reflect changes in expectations or in events conditions or circumstances on which the expectations may be based or that may affect the likelihood that actual results will differ from those contained in the forward looking statements I would now like to.
Speaker Change: Turn the call over to the Doctor, we shot clock chairman and CEO for diagnostics.
Take it away.
Doctor: Thank you, Matt and good afternoon, everyone and thank you for joining our quarterly update call. Today I'd also like to thank our long term shareholders for your ongoing support and commitment our team here at least say that singularly focused on driving our enterprise towards what we believe is a massive commercial potential and to enhance our long term shareholder value.
Doctor: Very pleased with the excellent progress the team has made over on multiple fronts. During the first quarter and the start of this year and really look forward to very exciting very near term milestones for our business. In particular are really excited about the fact that we were able to strengthen our balance sheet closing out our $30 million preferred stock financing to long term investors.
Doctor: It extends our runway well past these near term milestones and keep stock out of the market even further into the future.
Doctor: Okay. So, let's let's start off as usual with some highlights first with regard to our commercial execution reflected approximately just over $1 million in revenue for this quarter, which is flat quarter on quarter and about 124% increase on an annual basis. As we had noted last call. Our first quarter test volume range also.
Doctor: But at the same range of about a 10% increase at 2420 tests.
Doctor: Also at 31% increase on an annualized basis, we do still see increased productivity from the seller point of view improving P.
Doctor: O I S. T events are thriving we have 32, such high volume healthier events and we have now implemented a very streamlined centralized telehealth operation as part of it.
Doctor: Much focus on engaged on a robust pipeline of direct contracting engagements as we'll talk in more detail later that is all benefits brokers third party administrators and self insured entities offering neocart as a covered benefit.
Doctor: Our efforts over the past six to nine months with revenue cycle management improvements continued to pay dividends and we continue to work on a variety of initiatives to improve this process further including prior authorization appeals sufficient efficacy and others, while maintaining stable iden network a lot of months averaging about $800.
Doctor: Yeah.
Doctor: Some key strategic accomplishments for the quarter include as I mentioned strengthening our balance sheet by completing a $29 8 million series B preferred stock offering very key landmark accomplishments from this quarter was a peer reviewed publication.
Doctor: Positive data from our landmark National Cancer Institute sponsored clinical validation study of Isa Guard esophageal pre cancer testing that demonstrated unprecedented early precancer detection will cover those details a bit later.
Doctor: <unk>.
Doctor: Lengthened ether guards clinical data supporting ongoing engagement to secure both commercial and Medicare payer coverage.
Doctor: We've now secured a date July 17th for our multi X pre submission meeting, which will be an opportunity to review data.
Doctor: With the multi X group for a technical assessment seeking coverage of visa guard under its foundational local coverage determination for Medicare coverage.
Doctor: We are actively executing on what's the aggressive market access strategy, that's focused on securing medical policy coverage with reasonable plans and biomarker legislation states will cover that in some more detail later and as well as pilots with national plans.
Doctor: So for those who are working with the story just a few slides to to tell you about lucid lucid diagnostics as a commercial stage cancer prevention Medical Diagnostics company. We're focused on early pre cancer detection and our goal is to prevent esophageal cancer deaths in at risk patients and we have two technologies or <unk>.
Doctor: It's also true of DNA test in the east to check cell collection device.
Doctor: The <unk> test is the first and only commercially available test that's capable of serving as a widespread screening tool to prevent esophageal cancer death through the early detection of esophageal pre cancer.
Doctor: As I said previously and I'll say it again that the performance of this test is really unprecedented for a molecular diagnostic test.
Doctor: That statement is highlighted here and a comparison of east regards to performance to some other sample tests in the colorectal cancer screening space.
Doctor: Cologuard, which is wildly successful and widely available and has been for many years.
Doctor: Liquid biopsy tests from garden that has published data recently that has gotten a lot of attention.
Doctor: And it's important when you understand the performance of these types of tests to document it in a variety of different categories. So when it comes to cancer, you don't want to Miss cancer, and we have a very similar slide.
Doctor: Superior sensitivity for detecting esophageal cancer at or above the cologuard at other.
Doctor: Such tests.
Doctor: And certainly superior to the blood tests like car Ts, but the real differentiation and the reason why I comfortable used the term unprecedented is when you talk about pre cancer remember thats. What we are what we're focused on what we need to accomplish so in the pre cancer stage, we're still at that 90% plus or minus very close to 90%.
Doctor: Our sensitivity rate and that's just unprecedented cologuard does a pretty good job of picking up late stage pre cancers, but that percentage sensitivities about 40% to 50% and the blood tests are just not really.
Doctor: Really.
Doctor: When it comes to that even more impressive is that it's not just picking up late stage pre cancers, but we're picking up early pre cancers and that is truly unprecedented similar sensitivities for that early pre cancer.
Doctor: Those early pre cancer numbers and there is no ability and these other tests to pick up the earliest stage pre cancer, which gives us the opportunity to have a real impact on these patients. So we're even within that early pre cancer stage. We have sensitivity is still maintain even if you only have a short segment a disease, which is actually.
Doctor: The most common presentation of these patients that were trying to pick up in the most common scenario that leads to cancer and that's at 89%.
Doctor: So false negative rates false positive rates are all really.
Doctor: <unk> range for tests of this kind.
Doctor: So this results in a very large market opportunity for lucid there are 30 million patients actually more than 30 million patients that are at risk and are recommended for testing for pre cancer testing by the professor.
Doctor: Professional society guidelines Medicare are established.
Doctor: Mark for our for payment for this test at 90 to $138.
Doctor: So further that price point has been holding up quite well without a doubt the payments so that translates into an approximately $50 billion total addressable market opportunity. So we have a lot of opportunity even with low levels of penetration to generate substantial revenue.
Doctor: Gross margin at our current volumes is approximately 90%, which also facilitates our ability to drive this business.
Doctor: We have developed over the years, a multi pronged commercial strategy, which is focused on getting patients access to this test in a variety of settings, we have our own physical touch sensors in about 13 cities.
Doctor: Primary approach to testing as a satellite lucid test center model, which partners with physician practices, primarily primary care physicians, where are our clinicians will.
Doctor: Thank you all days in their office to test scheduled patients 10, 15 2030 patients in the days that that's the dominant form of like testing write downs. We also partner with the physician practice, and especially specialty practices for us to work with them and their personnel to do testing in their office and that model extends to the <unk>.
Doctor: Small hospitals as well as larger integrated delivery networks with a mobile Elisa test center that serves us well when the state of Florida, where that was necessary to do the kinds of testing and a big part of our.
Doctor: Our activity commercial activity remains or Cys T or check your food to health care type events focusing.
Doctor: Primarily firefighters, but expanding to other targets as well.
Doctor: So let's talk a little bit about where we are this quarter went so our test volume has.
Doctor: We remained flat and approximately as we mentioned 2000 400000 tests for the first quarter, that's consistent with what we described last quarter, where we have frozen our sales team actually going back to the early part of 2023 and although we're extracting some increases in productivity. We have some unfilled positions that have transferred some of those resource.
Doctor: Citizen to market access or direct contracting and so this is where we expect to be in.
Doctor: So we've reached a point with regard to realization of revenue that justify us increasing our sales team in driving our test volume, which we're confident we can do IP appropriate time revenue again was five quarter to quarter, Dennis will be talking a bit more about those trajectories.
Doctor: The realization of revenue as a function of the test volume and revenue opportunities.
Speaker Change: On the commercial execution side, we've had as I said are.
Speaker Change: Check your food to events are thriving we held.
Speaker Change: 32, such events during the first quarter, we've implemented a really streamlined centralized telehealth operation where people can people for example of <unk>.
Speaker Change: Testing of the fire department vacant prior to prior to the day of the event could actually registered through our telehealth operation can get their telehealth visit with a physician that confirm that they qualify for the test and actually have.
That referral made all prior to them, arriving our engagement with the firefighter community is just very is strengthening every quarter. It is very powerful.
Speaker Change: Powerful and very gratifying our team attended the FDIC International.
Speaker Change: Conference the largest the leading firefighter conference in the country was in Indianapolis with 30000 firefighters, we did onsite <unk> testing and engaged with.
Speaker Change: Our cheese from all around the country. Another major push as I as I hinted that remains our direct contracting initiative, we have a robust pipeline of direct contracting engagements with benefit brokers third party administrators of Sculpsure heavy.
Speaker Change: Okay. How does this work in this pathway. We are offering is regarded as a covered benefit to drive contractually guaranteed revenues we've targeted.
Speaker Change: These three groups benefit brokers third party administrators, and such self insured entities, such as employers and unions and other partners, where there are large groups of patients such as the 911 funds and others, where there is opportunity to access that can contract directly with these entities to cover these patients and there are a variety of ways that we're engaging with these entities.
Speaker Change: Somewhere in negotiating direct ongoing contracts or we just where we charge on a per patient basis.
Speaker Change: That where we enter through a benefit plan, we can charge for a lifetime benefit per member.
Speaker Change: And then we also offer testing days, either former half testing days on a fixed price.
So we're really looking forward to ramping this up during the second half of the year and feel we have the opportunity to do so.
Speaker Change: Supplement to the traditional pathways.
Speaker Change: So an update on our overall experience with claims and payment and coverage revenue cycle management remain critical we continue to have ongoing improvements in our process and partnership with cortex, our RCM provider.
Speaker Change: These improvements include over we're going to start a prior authorization program, which which accounts for approximately a quarter of the denials and youre, hoping to eliminate those through prior authorization. Our appeals process is getting much more sophisticated and targeted.
The percentage of appeals that we win is improving steadily we're recruiting and this is actually gratifying recruiting physicians local physicians to advocate on our behalf with regard to local payers, which is something that.
Speaker Change: That could have a big impact Dennis will talk about the numbers a little bit more detail, but we continue to have about half of our adjudicated claims allowed by the payers. This is all out of network and the payment is remaining stable at just under the Medicare rate.
Speaker Change: Some big developments on the medical policy coverage side, particularly with multi X upon publication of the National Cancer Institute sponsored study.
Speaker Change: Outstanding results from that we pull the trigger and asked before and secured a meeting with the multi X group could schedule for July 17th and this is a pre submission meeting where we had an opportunity to discuss.
Speaker Change: The body of clinical evidence. These are categorized as clinical validity data clinical utility data analytical validity data and review that data with them get their feedback and proceed thereafter to submit what's called a technical assessment of our Ta that seeks coverage under the existing foundation.
Speaker Change: No.
Speaker Change: Local coverage determination or LCD that multi X and other Medicare contractors published last year four tests in this category of esophageal testing.
Speaker Change: On the private side, we are again actively executing on this strategy. We're focused on securing medical policy positive medical policy coverage with the regional plans that have engagements with a number of them in a high area of focus for us our biomarker legislation states, which I'll show.
Speaker Change: Talk about a little bit more as well as pilot plans with pilots with the national plans, where we see coverage with evidence development.
Speaker Change: Sure.
Speaker Change: We are able to demonstrate the clinical utility of our study to that particular payer as well as the potential economic.
Speaker Change: Economic benefits to that payer in a study while getting covered and paid over that time. So those are the things that we continue to actively pursue.
Speaker Change: The biomarker.
Speaker Change: Initiatives are really we think will have a big impact.
Speaker Change: There are multiple states now that you can see here that have passed biomarker legislation that effectively mandated by statute that theyre different from state to state, but effectively mandate. That's local payers cover at these kinds of test similar to ours, and we were going to state by state and and <unk>.
Speaker Change: Working with the local with each states to confirm that we are covered under these under this legislation and use that to seek coverage at.
Speaker Change: At a minimum coverage under the state under the biomarker legislation for individual payers. So it gives us a great opportunity to do that.
Speaker Change: I'm going to provide a brief overview, we had a press release about this of the <unk>.
Speaker Change: Results of this exciting what I believe is a landmark study from the National Cancer Institute sponsored a group called better net consortium sponsored by the NCI.
Speaker Change: They published a landmark paper weeks ago in the American Journal Gastroenterology on ether Garden performed on samples collected with <unk> check.
Speaker Change: <unk> two upper endoscopy.
Speaker Change: Performance in detecting esophageal pre cancer and cancer and the conditions along that spectrum. The highlights are impressive and again unprecedented sensitivity for cancer was 100% of the cancers were detected the overall sensitivity and specificity, which was 85% each a very very key number that we believe.
Speaker Change: It is critical to demonstrating the value of this test is something called SSP. Our short segment B sensitivity. That's your ability to detect this short segment less than three centimeters one to 300 centimeters of disease. That's the hardest thing to detect because it's just a small patch of disease down by the far end of the esophagus.
Speaker Change: And it's the one that's most challenging for any type of molecular test.
Speaker Change: The key the reason why this is important is that about 70% of the cases, we're trying to identify in the screening population as defined by the guidelines are short segment. So as you can't detect MSR and they account for about half of the cancers. So if you can't detect short segment.
Speaker Change: Hey.
Speaker Change: High level of sensitivity, then youre not going to have the ability to have an impact on cancer deaths, because that's where most of the centers and we're heading that.
Speaker Change: A really high rate of an 8% rate and a negative predictive value so really low.
Speaker Change: False negative rate NPV of 98%.
Speaker Change: Hey documented something that we continue to see which is the average procedure time of up to five minutes on average we're seeing them, we're seeing times less than that some of us in the office had were tested last month and it took 30 seconds for a good test to be completed so really.
Speaker Change: Standing in that particularly in comparison to potential alternatives.
Speaker Change: Critical part do you believe that having a highly efficient screening test.
Speaker Change: We have studied and has shown no adverse consequence of adverse events from the testing consistent with other studies that we've shown to date.
I also like to spend a minute or two reviewing the results of a paper that was published last month on the technology.
Speaker Change: From an academic institution.
Speaker Change: On a test that's been to calls on comparing yourself against the group used.
Speaker Change: Sponge on a string device called a staffer cap to sample cells from a lower soft <unk> and apply a new molecular test with methylation markers audit I'll note that theosophic cap device.
Speaker Change: Device that we acquired and supply for a portion of the study, although we don't wonder a supply that.
Speaker Change: Some highlights to note, particularly in contrast are that the test showed poor sensitivity for short segment be which as I mentioned last time is really the most critical number and having an effective screening test for Softgel pre cancer, 63%. There were also some troubling complications about 20%.
Speaker Change: <unk> had mild operations of esophagus, but 2% had serious operations with bleeding and there were two catastrophic device families in the form of any attachments.
Speaker Change: So I thought it was worth summarizing that head to head comparison of our results. These are pulled results. Although they were pretty consistent across the various studies have Easter garden Easter check what the results that were reported in this publication on the anchor guard test in combination with a sponge on the string test. So again, let me emphasize the importance of <unk>.
Speaker Change: <unk> is critical because these are the patients that.
Account for about half of the cancers at 63% sensitivity in that category. It just is not going to be sufficient to serve as a commercial task that again that data is from this publication that was published last year also note that debt level.
Speaker Change: That 60% approximately 60% sensitivity in this critical category is about the same as the sensitivity that was published in a paper on that use the Medtronic situs sponge. Another sponge on our strengths our whole technology speculative string that led medtronic to withdraw that technology from the market.
Speaker Change: A variety of ways that a variety of areas to contrast, if you look at the device effectiveness as I noted Easter check gives you anatomic targeting of the area just a very small area, where I guess abnormality incurs sponge on spring devices to got Easter.
Speaker Change: <unk> is a check provides protected sampling so theres no dilution no contamination from cells elsewhere only into area or the targeted area sponge on string devices to that.
Lots of issues with regard to procedural efficiencies. The paper showed that the Sos device required topical anesthesia essentially nothing medicine applied to the mouse east to check does not require that.
Speaker Change: So as devices have to sit in the stomach and resolve for agents again as part of your study. There's no dwell time is attractive in that require that they.
Speaker Change: They had two devices that fails to deploy they did the dissolved and pull them out and they were still not fully deployed but we don't have that issue at all with visa check if you take the eight minutes and the time to swallow them back to use the time to actually complete the procedure is about 15 minutes as I mentioned, we're doing them in one minute one of the two minutes or less as little as 30 seconds.
Speaker Change: That's really important if youre doing these large events like these.
Speaker Change: Check me if we took events we've done 100, we've invested 100 patients in a day and at a firehouse you can't do that if you if it takes 15 minutes or more per patient and the only reason we can do that is because of the these.
Speaker Change: These low procedure times, the technical salaried are sort of being able to complete the test without patients being able to swallow and get a sample or.
Speaker Change: Our numbers and data that was presented at <unk> GI Conference 500 patients was 98% or just a 2% a technical.
Failure of much higher and the sponge on spring devices, but the key area here and one that I think is going to be ultimately.
Speaker Change: It sure is on device safety, there were 2% attachments.
Speaker Change: That are serious if not catastrophic despite detached from the strength in one case it has to be retrieved skeptically and another pass through new testing, but with the putting the patient at risk.
Speaker Change: Series of structuring and serious health risks as a result of this the attachments, we we actually initiated the recall of the.
Speaker Change: That's off of cap device that was used in the study after notifying the FDA about this and it was something we had something that was that was mandatory so that's going to be a significant issue.
Speaker Change: We just don't have to address we've never had any any device failures from user checking now over 10000 discussed Andy braces and the series of operations are not surprising, but cigna significant contrast here the sponge out of string devices are literally like a sponge like umbrella pad that scraping esophagus. So it's not surprising that you would see patients too.
Speaker Change: Have these integrations, including 2% that atmosphere integration.
Speaker Change: So check as they expire as a balloon that is soft sort of Christian surface to Edwin software on it and we just simply don't see these fixtures will be subject.
So with that I'm going to pass the baton onto doughnuts to talk about our financial results.
Doughnuts: Thank you Felicia and good morning, everyone summary financial results for the first quarter, we reported in our press release that was published earlier today.
On the next three slides I'll emphasize a few key financial highlights from the quarter, but I encourage you to consider those remarks in the context of a full disclosure is covered in our quarterly report on Form 10-Q.
Doughnuts: The balance sheet cash at quarter end March 31 was $24 8 million.
Doughnuts: We added $11 6 million to that amount with the financing completed last week for pro forma cash of $36 $4 million.
Doughnuts: The average quarterly burn for the trailing four quarters is $95 million per quarter.
Doughnuts: The burn in the first quarter included $7 million from ongoing operations and $2 5 million from the quarterly management services agreement with patented.
Doughnuts: Additionally, the company paid down the intercompany debt to patent Ed with pad met accepting three 3 million shares for $8 million debt reduction as previously disclosed in connection with the dividend distributed by Pat Pat that shareholders elusive stock.
$2 $8 million in cash payments.
Doughnuts: We disclosed in the 10-Q that our ability to fund operations beyond one year from today is largely dependent upon how revenues ramp over the next four quarters, which is of course dependent on how the reimbursement landscape for both government and private health insurance continues to improve.
Doughnuts: Additionally, our direct contracting efforts with self insured employers and or corporate finance activities, including refinancing the outstanding debt at that time can also work to exceed that threshold.
Doughnuts: Beyond that there is nothing subsequently remarkable about the remainder of the March 31.
Doughnuts: Balance sheet.
Doughnuts: Shares outstanding including Unvested.
Doughnuts: Our restricted stock awards as of last week, or 52, 2 million shares which includes $1 $1 billion issued subsequent to quarter end in connection with conversion notices.
Doughnuts: <unk> from the convertible debt holder.
Doughnuts: The GAAP shares outstanding as of March 31 to $46 7 million are reflected on the slide as well as on the face of the balance sheet in the 10-Q.
Doughnuts: GAAP shares do not reflect unvested restricted stock awards.
Doughnuts: On slide 20 <unk>.
Doughnuts: It compares this year's first quarter to last year's first quarter in certain key items.
Doughnuts: As you review the information on my comments in light of the cautionary disclosure in the bottom of the slide about supplemental information, particularly non-GAAP information I'm required to say that.
Doughnuts: As previewed in our fourth quarter earnings call.
Doughnuts: Revenue of just over $1 million for the first quarter sequentially about even with the fourth quarter reflects more than a two fold increase over the prior year first quarter.
Doughnuts: The amount reflects actual cash collections for the quarter plus a small amount of Invoiced Isa guard tests delivered to the VA.
Doughnuts: Plus about $25000 for direct contracting.
Doughnuts: Test volume at 2420 tests for the quarter represent just over $6 million in submitted claims at our 2000 and $499 ASP.
Doughnuts: Revenue recognition and I know this gets repeat it each quarter, but it's important a key determinant is the probability of collection and therefore due to the fact that we are in early stages of our reimbursement process means revenue recognition for claims submitted to traditional government or private health insurers will be recognized when the claim is.
Doughnuts: Actually collected versus when the patient reported invoiced and submitted for reimbursement.
Doughnuts: As you'll see and disclosed in our 10-Q. This is called variable consideration of jargon have gaps ASC 606 revenue recognition guidelines and presently there is insufficient predictive data to reflect revenue when the test report is delivered to the referring physician.
Doughnuts: For billable amounts contracted directly with employers.
Doughnuts: And that are fixed and determinable, they will be recognized as revenue when the contracted service delivery that means generally means when our report is delivered to the referring physician.
Doughnuts: Our non-GAAP loss for the first quarter of $9 4 million.
Doughnuts: Reflects about a $500000 sequential improvement compared to the fourth quarter loss and about a $400000 improvement year over year from the prior year first quarter.
Doughnuts: Slide 21.
Doughnuts: He is a graphic illustration of our operating expenses for the periods reflected total.
Doughnuts: Total non-GAAP Opex was $10 4 million for the first quarter of 2004.
Doughnuts: It reflects about a $500000 decrease sequentially and a fairly flat year over year.
Doughnuts: Cost of revenue primarily consists of Easter check devices lab supplies and.
Doughnuts: In fixed lab facility costs and is in line with the last couple of quarters, where the test volumes range between 200 2600 tests.
Doughnuts: The non-GAAP net loss per share has been relatively flat for each of the last five quarters, plus or minus a penny between each of those five quarters.
Doughnuts: On a GAAP EPS basis noncash charges accounted for approximately <unk> 19 per share in the first quarter of which 17 was directly related to the noncash deemed dividend.
<unk> to the March financing of $18 $2 million.
Doughnuts: Couple of highlights.
Focus on the last two quarters with our first quarter. This year in the last quarter of last year.
Doughnuts: Collectively there were just under 4000 claims 3975 claims representing just under $10 million in pro forma revenue.
That were submitted for reimbursement about 75% had been adjudicated 25% are pending.
Doughnuts: Out of the 75% that had been adjudicated.
Doughnuts: About 46% almost half resulted in an allowable amount by the insurance company with a mean average.
About $700 per test.
Doughnuts: And as you collect these things over a longer period timelines are longer aging time horizon with appeals approximately 18 <unk> hundred dollars per test, which is in line with previous quarters. We report same statistics of those denied about 53% of the denials are deemed not medically necessary.
Doughnuts: Or require a prior authorization.
Doughnuts: And about 28% were deemed to be non covered.
Speaker Change: So with that operator, let's open it up for questions.
Speaker Change: Thank you ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press star followed by the number one on your Touchtone phone.
Speaker Change: You'll hear a prompt that there had been raised should you wish to decline from the polling process. Please press star followed by the number two if you are using a speaker phone. Please lift the handset before pressing any keys.
Speaker Change: One moment, while we prepared the Q&A roster for you.
Speaker Change: Your first question is from the line of Mike Matson from Needham. Please go ahead.
Michael Stephen Matson: Good morning, Mike. Thanks, Mike Good morning, I wanted to start with the Mol Dx pre submission meeting.
Michael Stephen Matson: So can you maybe just tell us more about what you're expecting to happen there kind of what the potential outcomes of the meeting would be.
Michael Stephen Matson: So just to be clear. These are pre submission meetings I think the analogy for those who have.
Michael Stephen Matson: The.
Experience or heard about descriptions of FDA pre.
Michael Stephen Matson: Pre submission meetings is not quite as structured and formal but that's similar and the purpose of these meetings is to meet with the key personnel the medical directors at multi X and to review the.
Michael Stephen Matson: Okay.
Michael Stephen Matson: Full evidence space consisting of.
Michael Stephen Matson: Clinical validity clinical utility and analytic validity data and to do so in the context of the elements of the already published and finalized foundational LCD and simply to have a conversation about that also in the context of new information such as the guidelines and so forth. So we expect to be well represented with both our <unk>.
Michael Stephen Matson: And others, who can.
Michael Stephen Matson: Okay.
Michael Stephen Matson: It describes the context of our data in that rate and that result, and look with the goal of that of the goal of that is too.
Michael Stephen Matson: As to be able to.
Michael Stephen Matson: And form the actual document the technical assessment that would be.
Michael Stephen Matson: Submitted following that meeting to formerly seek coverage under the foundational LCD. In addition to personnel from.
From the company.
Michael Stephen Matson: Various key roles, we expect to have.
Michael Stephen Matson: Other key expert sustained lapidus, our vice chairman and his expert and diagnostics will be contributing as well as one of our medical advisors, who is an expert and author on the guidelines that we expect to provide some additional support.
Michael Stephen Matson: So that's the nature of the meeting we would leave with that with a sense of where we stand with their data and in our form the actual formal process, which is to submit the technical assessment.
Michael Stephen Matson: And then have that clock starts.
Michael Stephen Matson: Following the meeting.
Speaker Change: Okay. Thanks, I'll start following the submission excuse me.
Speaker Change: Yeah got it and then just in terms of the <unk> been running that kind of like 2500, 2400 tests per quarter. It out for a few quarters.
Speaker Change: Your revenue has been growing a little as you get more youre able to collect more payments I guess.
Speaker Change: So.
How long should we expect you to remain in this sort of a holding pattern in.
Speaker Change: At what point would you start to try to grow the tests, what point would you need to get to in terms of the coverage or the payment rate.
Speaker Change: Before you would start to really try to drive more test volume again, yeah. Great question. So I'll talk about a little bit on the test volume side I'll have Dennis Tremont.
Dennis M. McGrath: Translating test volume into revenue so we've talked about this a bit.
Dennis M. McGrath: On our last call, which is that we've had.
Dennis M. McGrath: A fixed.
Dennis M. McGrath: Level of personnel and our sales team to sell side, where obviously you have been and remain in a posture, where we're trying to maintain our opex is flat to the best of the best of our ability during a period of time and we as I also mentioned last time, but I'll reiterate that the.
Dennis M. McGrath: Claims volume, we have has been sufficient to drive claims history and to drive our engagement with private payors.
Dennis M. McGrath: <unk>.
Dennis M. McGrath: As I again, just sort of reiterate a bit from our last call. This level kind of in the 2400 plus range is a level that we think we can maintain with our current team.
Dennis M. McGrath: We did actually have fewer sellers in the field this quarter as we transferred some resources and did not sell certain open positions in order to make sure we have sufficient resources under the same overall opex in our key market access and direct contracting.
Dennis M. McGrath: Initiatives and so.
Dennis M. McGrath: Certainly there is a.
Dennis M. McGrath: Possibility that even with at this current level, we might we may continue to see some modest growth, we saw about 10% quarter on quarter.
Dennis M. McGrath: As a result of it.
Dennis M. McGrath: Increasing.
Dennis M. McGrath: Check your food type events, which tend to be more efficient in terms of the.
Dennis M. McGrath: The.
Dennis M. McGrath: Personnel sales personnel in the field per test and obviously, if we start seeing some when we start seeing some traction on the direct contracting side, which.
Dennis M. McGrath: Can drive test volume independent of essentially independent of the sales activity.
Dennis M. McGrath: So.
Dennis M. McGrath: I'll transfer to Dennis to talk a bit about what where our thresholds are and at what point in a rising revenue.
Dennis: The revenue and the realization of revenue.
Dennis: From test volume would we consider it.
Dennis: Our opex and adding some resources in order to drive test volume.
Dennis: As a as a method of driving as a lever to drive revenue.
Dennis: Mike I think it's.
Those decisions are going to be on a quarter by quarter basis, as we see realization, meaning cash collections as a percentage of billable claims increases and as Lisa pointed out there are a couple influences there.
Dennis: We will start to make those investment decisions.
Dennis: At the time some of these.
Dennis: Events start to show themselves, maybe even in advance of actually collecting and they are direct contracting because the prices guaranteed is we see that start to increase that will give us reason in fact, we're already putting some additional resources behind that.
Dennis: In addition, I think we've previously mentioned we have submitted some formal applications for some of our larger regional insurers to move from out of network to in network.
Dennis: Those decisions become available that will influence, making those investments clearly that's an indication of what realization will become in the subsequent quarters. After those approvals obviously.
Dennis: In response to.
The Medicare upcoming decisions that will influence timing as well. We're also in the process of trying to fully understand the biomarker legislation and what influence that might have as they both the states that are requiring coverage with insurers operating within their states how that plays itself out.
Dennis: We're seeing pretty closely in tune with that in terms of does that make sense for us to put additional resources in those states as they work out those logistics between the state legislation and the actual carriers covering biomarkers. There all the influences that will have a step one.
Dennis: On the accelerator to do so obviously with the recent financing we have the resources to be able to be responsive to those.
Dennis: Those events so.
Dennis: Pretty much stay tuned as I indicated at the outset, it's a quarter by quarter basis, and we have and are ready to.
Dennis: To put these things in place to be responsive to see these events.
Speaker Change: Okay got it thank you.
Thanks, Mike.
Speaker Change: Yeah.
Speaker Change: Your next question is from the line of Anthony Vendetti from Maxim Group. Please go ahead.
Anthony V. Vendetti: Anthony Good morning, Anthony.
Anthony V. Vendetti: Good morning, John Good morning, Dennis.
Anthony V. Vendetti: Yes, some of those questions were around some of mine but.
Anthony V. Vendetti: Maybe just further talk about the process you did mentioned that you are hoping that.
Anthony V. Vendetti: Some of the coverage benefit goes from out of network to in network.
Anthony V. Vendetti: That's obviously would be would be significant.
Anthony V. Vendetti: Can you just remind us where we're at in terms of the number of insurers that will.
Anthony V. Vendetti: And burst.
Speaker Change: Oh excuse me, maybe the number of.
Speaker Change: Maybe the large insurers if we talk about the thickness, the aetna and United Health carriers of the World where are they in terms of their reimbursement coverage.
Speaker Change: And.
Speaker Change: Yeah.
Speaker Change: What's the likelihood that they sign up either this year within the next 12 months as either an in network out of network.
Speaker Change: Let me, let me, let me outline that a bit at a high level. So you asked about the larger the larger payers. So just to be clear on the auto network side, we do get paid we have we get we do get paid out of network that has went through those numbers. We do get allowed claims and allowed claims at just under the Medicare rate on average and some of those.
Some of those larger payers are actually doing that.
Speaker Change: As a distribution in some of those are doing that at a higher clip our focus with regard to <unk>.
Speaker Change: Getting near term.
Speaker Change: <unk> medical policy.
Speaker Change: A medical policy for coverage is not focused on the large payers are our engagement with the large payers is focused more pilots.
Speaker Change: Pilots.
Speaker Change: <unk> coverage with evidence development, because it's our understanding and expectation that the larger payers are generally.
We'll wait for.
Speaker Change: Most positive coverage by multi <unk>.
Speaker Change: And then a care in general however, theres very fertile ground over there we're actively pursuing on the regional plan. We mentioned last time that we have.
Speaker Change: We are engaged with the Bluecross Blueshield Association to the National Association of benefits.
Speaker Change: And they've been quite remarkable in doing so.
Speaker Change: Our engagements with individual state plants and those are actually we're chipping away at those windows are.
Speaker Change: We're having some success and as Dennis mentioned in particular, though.
Speaker Change: That are in.
Speaker Change: States with biomarker legislation, we really believe we can actually make make progress some covered under those regional plans.
Speaker Change: In the near term.
Independent of the of the multi X process.
Speaker Change: And then there are of course are these direct contracts, which are completely independent of the entire the entire process.
Speaker Change: So one example of that is.
Speaker Change: Our.
Speaker Change: In the slide that I showed over on the right there entities that have large number of patients under.
Speaker Change: That have where they cover their expensive cover conditions and one that we had already.
Speaker Change: And given a preview of as the World Trade Center and 911 fund.
Active.
Speaker Change: Questions with them, we are optimistic that won't be able to.
A final engagement with that group through one of their centers of excellence, which we're talking to right now and so that's the pathway to provide patients within who are covered by that of which there are about 100000.
Speaker Change: Access to our test.
Speaker Change: Benefit.
Speaker Change: It's a completely independent.
Speaker Change: Insurer repair process.
Okay. That's helpful and maybe just more very big picture here.
Speaker Change: Had a great investor day with a couple of Gastroenterologists.
Speaker Change: And a thought leader talks.
Speaker Change: <unk> talked about.
Speaker Change: Hum.
Speaker Change: The Pap smear changed.
Speaker Change: Cervical cancer.
Speaker Change: And obviously.
Speaker Change: Cologuard.
Speaker Change: As you see this.
Speaker Change: Process continuing to unfold in some of your competitors, having a recall.
Speaker Change: Is there a <unk>.
Speaker Change: Shipping point do you think it's a three to five year process before Easter Garden check becomes a standard and it becomes more well known.
Speaker Change: When I was speaking to the guests one of the Gastroenterologists that was that this investor conference.
Speaker Change: <unk>.
Speaker Change: He was just saying that it's it's it's.
Speaker Change: Is difficult to get the word out there because not everyone.
Speaker Change: Associates esophageal cancer as a major cancer, even though we know it's one of the most lethal how how long do you think this process takes before you hit that tipping point is I'm just curious what your what your view Amazon I think that's a great question and let me start with the latter part so.
Speaker Change: It's not going to be that hard because there is a lot of attention a lot of increasing attention on.
Honest artificial cancer and you are correct that over the decades, it's been under we focus on breast colon and prostate and some common cancers, but our efforts and our ability to get that message out at for that to resonate without a lot of effort across the physician community both primary care and specialists.
Speaker Change: As.
Speaker Change: For it because we have a straightforward story, we have a well defined target population, we haven't well, we havent methodology and in understanding the biology, we know what to do in patients who come back positive and so the message you heard from the physicians for example at the.
Speaker Change: At the Investor day is resonating across the country, and that's actually playing itself and local and local.
In local markets across the country and.
Speaker Change: News media firefighter events have been very helpful for us we run them at a great piece of the ABC news in L. A and we have a variety of those that are happening and we expect that in that pipeline.
Speaker Change: Translate into national.
Speaker Change: Awareness for this and it's a process, but it's not a process that that I believe will take years because all the pieces are in place. We're not we don't have to define the population we don't have to make.
Speaker Change: All the all of the element for us to tell the story, which is a very compelling story, Australia I can tell you in every interview if I've ever done.
Speaker Change: And Ah lay population.
In MPR recently, it's been a very straightforward aha moment conversation, where we're actually its actually quite amazing to me how frequently it happens once a week or so when we're talking to folks and they objective just sort of objectively about the business and we hear about a family member or the <unk>.
<unk>.
Speaker Change: Colleague, who had suffered from esophageal cancer and the physician community. The GI community. That's actually also quite straightforward because it's already in their guidelines, we didn't write their guidelines stated and so the.
Speaker Change: The need to identify a pre cancer and to do so as a methodology to prevent cancer. That's well established we don't have.
Speaker Change: The hurdle to overcome to suggest that detecting pre cancer. In this condition is something that controversial it's not it's been and guidelines in the last in the last three guidelines and unlike.
Speaker Change: Cologuard for example, which.
Speaker Change: It was operating in an environment, where there was already about 50% to 70% of patients we're getting colonoscopy.
Speaker Change: Very few less than 5% assessing no patients at our target population are getting endoscopies. So we're completely allied with the gastroenterologists and our ability.
Speaker Change: To talk to them about going out and expanding their funnel and identifying patients that theyre not seeing an increase in the yields are there the number of endoscopies and the yields are they're endoscopies and so we have great relations with the leadership in the GI community that all of the Kols.
Speaker Change: We're excited where we have a big presence coming up at the major the biggest Gi meeting in the country and the country every year, which is the DW meeting which starts this weekend.
Speaker Change: Our medical Advisory Board is meeting their knickers consists of of who's who in the GI community of esophageal disease, and we're going to be meeting for a couple of hours on Friday and talking about all of the key issues that I already highlighted earlier such as the importance of short segment.
Speaker Change: American esophagus, the importance of having a cell collection device that has.
Speaker Change: Excellent device safety.
Speaker Change: And the features of the visa check and so that story is we're already getting that out when we'll actually the expansion of the activity will be a result of that.
Speaker Change: The triggers that we mentioned with regard to coverage and so forth, but the story is getting out there.
Speaker Change: It's not going to take.
Speaker Change: That long once were.
Speaker Change: And full throttle to have that spread.
Nationwide, it's just hasnt been a hard toy story color Anthony.
Speaker Change: Great that's excellent color Alicia. Thanks, Thanks, so much I'll hop back in the queue I appreciate it thanks. Thanks Anthony.
Speaker Change: Okay.
Speaker Change: Next question is from the line of Mark Massaro from <unk>. Your line is now open.
Mark Anthony Massaro: Mark Good morning, Hi, Mark.
Mark Anthony Massaro: This is actually living in on for Mike. Thanks, Thank you David.
Mark Anthony Massaro: Okay.
Speaker Change: He gave the other piece of this.
Mark Anthony Massaro: A little bit, but just remind us what the average time for any technical assessment process is.
Mark Anthony Massaro: When you would expect that final CMS coverage for <unk> session.
David: Well, we can't predict the ladder.
David: The turnaround time for the.
David: For our responses CA is a minimum of 60 to 90 days to point, but that's where it can get extended if there are questions along the way again for those who are familiar with the FDA process, if not if not.
David: Similar to that in that once the data submitted.
David: Ta submitted and they've had a chance to review that there may be opportunities to come back with questions or questions about the data and so forth.
David: Really impossible to say how long.
David: It will take for that process to be completed and result in a final decision, but we think we're going in well armed with with great data. We have literally multiple consultants that were working with who are experts in this who've done.
David: Advanced test through the <unk> process and there is quite a bit of optimism amongst the group around that but in terms of timing, it's a little bit hard to say.
David: Impossible to predict at this point, but we go in with a lot of confidence in the substance and the quality of our data.
Speaker Change: Okay, I missed that and then I just.
Speaker Change: Follow up on last quarter I think what this does for the following.
Speaker Change: Matthew bullish in the pipeline.
Speaker Change: Thank you.
Speaker Change: Last one realizing that revenue and just how we should think about maybe any contribution in pacing throughout the year.
Speaker Change: Yes. Thanks.
Speaker Change: For that so yes, there is the backlog of pending.
Speaker Change: Amounts to be adjudicated.
Speaker Change: And the appeals process is picking up from it.
Speaker Change: In intensity standpoint, with our revenue cycle manager.
Speaker Change: It's hard to predict.
Speaker Change: The timing of that they appeals process is a longer period of time.
Speaker Change: The statistics that we gave.
Speaker Change:
On our prepared remarks.
Speaker Change: 25% or so of them still waiting to be adjudicated.
Speaker Change: Yes that backlog is still about that same amount.
Speaker Change: Dave it's hard to match up that phasing.
But we know what the appeals look like we know what we're having some success there and it's starting to gain some momentum so no additional color to offer just yet.
Speaker Change: Great. Thanks for taking the question.
Speaker Change: Thanks, everyone.
Speaker Change: Your next question is from the line of Kyle Nixon from Canaccord. Your line is now open good morning.
Kyle Nixon: Hey, guys, Hey, guys. Thanks for the questions.
Kyle Nixon: Hope you're doing well so I'm, just starting with the <unk> class II FDA recall.
Kyle Nixon: Wanted to ask a few things about this basically first of all just kind of rewind back to 'twenty one around the time of the IPO. When you made the acquisition of kept gnostics like why why did you do that and what kind of.
Kyle Nixon: Commercial agreements or manufacturing agreements are signed that now are irrelevant or sort of impacting expenses that arent really useful just kind of update us on that maybe and then I'll go and then secondarily. If you could just talk about the competitive dynamics here and how maybe certain companies, where our vendors. We're using this off a gap and now obviously.
Kyle Nixon: That doesn't look great for them and maybe this is advantageous for you. Thanks.
Kyle Nixon: Sure.
Speaker Change: Thanks, Kyle so, yes, Hello, happy to rewind back a bit to get some of the history for those who are not.
Speaker Change: So we have to.
Speaker Change: 2021 we have the opportunity we engaged with the small company kept plastics that was making the sponge solar string device and we acquired it we had an interest in it as a research tool there potentially other applications that.
We were considering looking at.
Speaker Change: And after we acquired it we had discussions with the two institutions that had ongoing research that were being supplied by by it and we agreed to.
Speaker Change: To supply it.
Speaker Change: For that research, we have really no no no.
Speaker Change: Concerned about doing so at the time.
Speaker Change: <unk>.
It really because we were quite confident at the time that the ether check was a superior device for this particular.
Speaker Change: Particular application and we were well aware of the limitations of the sponge solar string, but we had some interest in potentially using it as a research tool.
Speaker Change: And had no problem, providing it to these studies because we are quite sure where the where the results would land based on prior experiences.
Speaker Change: Scientists sponge that continued until early last year.
Speaker Change: <unk> to come up with a.
Speaker Change: Does this agreement with the two institutions around how to continue supplying it that we stopped supplying sponges.
Speaker Change: Sponges.
Speaker Change: Approximately a year ago in the early early part of 2023.
Speaker Change: And it was only after the publication of the.
Speaker Change: The most recent publication.
Speaker Change: So the data, which I highlighted that we became aware of the two detachments and we were aware that scientists filings. The others is going to the string which again both of these technologies have been around for years, the sulfur cap essentially identical to technology that was developed in the.
Speaker Change: In the early 1990 by the same with the same company that we acquired in frame. We were aware of that satisfying has had numerous detachments as well, but it's off of patent and the scientists behind us as we mentioned in the press release is under a global recall right now.
Speaker Change: Specifically for those detachments and if you read the Medtronic language that we highlighted in the press release it was specifically for potential.
Speaker Change: Serious risks associated with these detachments.
So when we saw the report of the two detachments and that and the manuscript that was published we were.
Speaker Change: Bit alarmed because they were not reported had not been reported to the FDA of our database and.
Speaker Change: And so we inquired of FDA and concluded that we had to to initiate initiate a recall of that.
Speaker Change: What.
Speaker Change: How this played out where we thought it would play out which is that.
Speaker Change: <unk>.
Speaker Change: The.
Speaker Change: Technology and electric.
Speaker Change: Electric tests are one thing, but at the end of the day the cell collection device matters in all of the head to head features that I showed in your in the table there are critical to get the level of.
Speaker Change: Performance, particularly at the sensitivity of the short segment and the features.
Easter check, particularly the collective protect features the visa check that allow for targeted targeted sample and again, it's critical for that.
Speaker Change: So we werent really that surprised with the results of the study using the sponge.
Speaker Change: Applying a portion of it.
Speaker Change: In that category in particular, it's really no different than the Medtronic data.
Speaker Change: Data on <unk>, three that was published by Nick Shaheen.
Speaker Change: In the U S. A few years ago that led to Medtronic with calling that.
Speaker Change: With regard to the competitive landscape I'll leave that for you guys.
In terms of the overall business.
Speaker Change: We have.
Speaker Change: Enormous confidence in both the cell collection and the and the molecular diagnostic test the published data is what it is.
Speaker Change: And.
Speaker Change: I think the most recent data really highlights the fact that if youre going to have a test that can be efficacious in detecting precancerous.
Speaker Change: To prevent cancer you have to pick up the short segment pre cancers.
Speaker Change: If youre going to have any kind of an impact because they account for about half the cancers and so.
Speaker Change: At the end of the day.
Speaker Change: Well I'll leave it up to you guys just sort of look at the data and so forth, but from our point of view, we are proceeding with profound confidence in our technology.
Speaker Change: Hey, Kyle it's important to understand even if reengineering effort could figure out how the safety issues can be overcome this study pointed clearly to the contamination because of the lack of the ability to protect the sample so.
Speaker Change: They'd have to figure out how to put the sponge back in the wrapper, which is physically impossible to overcome that limitation that design limitation.
Speaker Change: So we think unless there is a.
Speaker Change: Way to engineer around our patents on east with Jack is going to be really difficult for someone with a nice biomarker to be able to sample in a way that's going to allow the biomarker to perform similar to what our accommodation of visa check in these regards but just again just to be clear there is no evidence of that and we have.
Speaker Change: With strong issued and pending IP on that and so we don't really.
Speaker Change: Yes.
Speaker Change: No concerns because theres nothing out there that would suggest that there is another technology out there.
Speaker Change: Again that was not invented in the 19 nineties that can do that.
Speaker Change: Targeted sampling we need for those very very.
Speaker Change: <unk>.
Speaker Change: Specific purpose in collecting cells in a very small proportion of the lower softness.
Speaker Change: Okay that was a great that was really comprehensive answer and I'm sure one day, if someone's going to.
Speaker Change: You can make the argument that a blood based test could be useful here, but we can wait for another day.
Speaker Change: Got it.
I expect that that real quick.
Speaker Change: Yeah, well, we wont debate sort of what how the blood test how the blood based tests are doing as a whole again I'll leave that for you right.
Speaker Change: Informative reports on a regular basis, but let's talk about blood based test for esophageal cancer right. So to whatever extent there may be ongoing progress.
Speaker Change: Good data and our ongoing progress with regard to detecting cancer in the blood there's been.
Speaker Change: A little or no progress in detecting pre cancers and as we've stated before you cannot you cannot have an impact on esophageal cancer deaths unless you are picking it up at the pre cancer stage because unlike <unk>.
Speaker Change: Call. It in other cancers of stage, one diagnosis of esophageal cancer.
Speaker Change: Still carries about a 50% mortality and the biology of trying to detect IMAX showed those slides of sort of how garden does garden.
Speaker Change: <unk> does okay with cancers.
Speaker Change: As you were you've highlighted in your reports the results in even in late stage pre cancers.
Speaker Change: Sure.
Speaker Change: The freedom data would suggest that it's even lower so the biology of picking up.
Speaker Change: Abnormality that are required to pick up early stage pre cancer would you have to do in order to prevent esophageal cancer, there's not any inkling yet.
Today that you can do that with them with a blood test for our little corner of the world here in esophageal cancer.
Feel very confident that liquid biopsy tests are not not a threat in any way.
Speaker Change: Anytime in the foreseeable future. Thanks for letting me highlight.
Speaker Change: Highlight that again.
Speaker Change: Alright, and then final one for.
Speaker Change: Both of you guys, but maybe.
Speaker Change: Dennis is physically just thinking about models.
Speaker Change: The $1 million in revenue this quarter flat compared to last quarter.
Speaker Change: I guess, the volume kind of increase sequentially pretty nicely actually how do you how should we think about the seasonality in this business in other screening businesses. There is seasonality kind of early in the year kind of gets better throughout the year. This flu season et cetera. So is there anything to consider as we kind of go ahead here in terms of sequential increases in them.
Speaker Change: Revenue growth.
Speaker Change: Yes, I think the only seasonality to consider is the times' first off our test is very conveniently administered.
Speaker Change: So the times of the year, where it's not convenient for patients to get tested.
Speaker Change: The holiday season in December.
Speaker Change: Physicians are just not going to schedule. This that the large check your food tube events are probably not going to happen.
Speaker Change: Christmas week, Theyre, probably going to be at around that it's probably the only time that we see it.
People think about seasonality during the summer in the last two weeks of August maybe.
Speaker Change: September tends to overcome that whatever time period is so I don't think seasonality, particularly while we're in this kind of mid throttle range is something for us to consider it really is.
Speaker Change: The volume is directly related to the realization on submitting claims and our reaction to that momentum that we're expecting to to pick up in the coming quarters.
Speaker Change: Great perfect. Thanks, Dennis Thanks, guys I appreciate the time.
Speaker Change: Thanks, Tom.
Speaker Change: Ladies and gentlemen, just a reminder, if you have a question. Please press Star then the number one on your telephone keypad.
Speaker Change: Your next question is from the line of Ed Woo from <unk> capital. Please go ahead.
Edward Moon Woo: Congratulations on the progress in the quarter I know you are all focused on the U S business, but have you thought about international opportunities.
Edward Moon Woo: So we have overtime.
Edward Moon Woo: Over time, I think we've talked about it on occasion.
Inquired with had inquiries actually from from.
Edward Moon Woo: Our commercial entities outside looking to potentially partner with us.
Edward Moon Woo: Current business volatile around reimbursement in the UK and Europe for screening test is not attractive and so we've we haven't made any particular effort, but there are other groups.
South America and in Asia that have contacted us and it would have to be sort of essentially a license type agreement, where we have no <unk>.
Edward Moon Woo: And we don't think it's consistent with our with our current.
Strategic approach to put resources in other countries, but.
Edward Moon Woo: Yes.
Edward Moon Woo: There are there are market opportunities there, we do occasionally get inquiries that we have one actively that we're that we're discussing with right now.
Edward Moon Woo: But I don't expect that to be significant.
Edward Moon Woo: Contributor in the near term.
Edward Moon Woo: Just a quick question on the Suffolk, just there's obviously very daily I assume it's similar.
Edward Moon Woo: Globally as it is in the U S. In terms of you know people are getting it and definitely.
Speaker Change: Great question. There are two types of esophageal cancer. The one we see here in the U S and in the west as esophageal adenocarcinoma.
There is a soft gel squamous cell carcinoma, which used to actually even in this country would be the dominant factor more smoke more associated with smoking and tobacco and other things as opposed to adenocarcinoma, which is what's related to GERD heartburn.
Speaker Change: In Asia the numbers for.
Speaker Change: For squamous cell carcinoma remain higher.
Speaker Change: Although as is as is true with many things are sort of a homogenous homogenization across the world.
Speaker Change: Because the western diets and.
Speaker Change: Lifestyle in the diseases that come with that obesity et cetera that there is large there is plenty of opportunity for esophageal adenocarcinoma worldwide.
Speaker Change: So that there is.
Hopefully that gives you a sense.
Speaker Change: Yeah.
Speaker Change: Yes. It does thank you very much and I wish you guys. Good luck. Thank you.
Speaker Change: Thanks, Ed.
Speaker Change: There are no further questions at this time I would like to hand, the call back to Dr. <unk> for some closing remarks. Please go ahead.
Speaker Change: Great Hey, thanks, everybody for taking the time and as always thanks for all the great questions I really believe that a great discussion hopefully you can get the sense that we're really excited we have a lot of a bunch of near term.
Activity in milestones starting with the <unk> meeting this week.
Speaker Change: And followed with.
Speaker Change: A bunch of activity of our engagements with brokers.
Speaker Change: The multi X meeting coming up more data in which we didn't really talk about that that's forthcoming beyond the data package that we're already putting together.
Speaker Change: So we look forward to keeping you abreast of our progress of your news releases and periodic calls such as this.
Speaker Change: And as always the best way to keep up with our news.
Speaker Change: Updates and events is to sign up for E Mail alerts on the lucid Investor Relations website, following us on social media, including Twitter Linkedin on our website and always feel free to contact Matt with any direct questions. So thank you everybody and have a great day.
Speaker Change: Ladies and gentlemen. This concludes today's conference call. Thank you very much for your participation you may now disconnect.
Speaker Change: Yes.
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