Q2 2024 MDxHealth SA Earnings Call

Michael McGarrity: [music] representing total test unit growth of 31 percent.

Operator: Greetings and

Speaker Change: my

Operator: Greetings, and welcome to the MDx Health Second Course.

Operator: welcome to the MDxHealth Second Quarter 2024 Earnings Call.

Speaker Change: gradingss and welcome to the mdx health second quarter two thousand and twenty-four earnings call

Operator: At this time, all participants are in a listen-only mode.

Speaker Change: at this time all participants are in iccent only mode if anyone should require operator assistance during the conference please press ststart zero on your telephone keypet

Operator: If anyone should require operator assistance during the conference, please press star zero, on your telephone keypad.

Operator: A brief question and answer session will follow the formal presentation. As a reminder, this call is being recorded.

Speaker Change: a brief question and answer session will follow the formal presentation

Operator: Welcome to the MDx Health Second Course, and welcome to the MDx Health Second Course.

Operator: Before we begin, I would like to remind everyone that we will make forward-looking statements, during today's call. Whether in prepared remarks or during the Q&A session, these forward-looking statements, are subject to inherent risks and uncertainties.

Speaker Change: as a reminder that call is being recorded

Speaker Change: before we begin i would like to remind everyone that we will make forward-looking statements during today's call

Speaker Change: whether in prepared remarks or during the qa session these forward-looking statements are subject to inherent risks and uncertainties

Operator: These risks and uncertainties are detailed in the risk factor section of our filings with the Securities and Exchange Commission, specifically in the company's annual report on Form 10-K and Form 20-F.

Michael McGarity: these risks and uncertainties are detailed in the risk factor section of our filings with the securities and exchange commission specifically in the company's annual report on form ten on form twenty f i would now like to turn the call over to michael mgarity co thank you michael you may begin

Operator: These risks and uncertainties are detailed in the risk factor section of our filings, with the Securities and Exchange Commission, specifically in the company's annual report on Form 10 on Form 20F.

Michael McGarrity: I would now like to turn the call over to Michael McGarrity, CEO.

Operator: I would now like to turn the call over to Michael McGarrity, CEO.

Operator: Thank you, Michael.

Operator: You may begin.

Michael McGarrity: Thanks, Paul.

Michael McGarrity: Thanks, Paul.

Michael McGarrity: And thank you all for joining us for our Second Quarter 2024 Earnings Conference Call, for MDxHealth.

Michael McGarrity: And thank you all for joining us for our second quarter 2024 earnings conference call for MDx Health. With me today is Ron Kalfus, Chief Financial Officer. I am pleased to report that our business continued to generate strong financial performance in the second quarter and first half of 2024. With revenue growth of 32% and 34% respectively over 2023. Our results reflect our continued focus on commercial execution and operating discipline, which we believe will drive sustainable growth through 2024 and beyond. On our last call, I noted our strategy of creating multiple sources of growth that proved to be the case again in Q2.

Speaker Change: thanks fall

Speaker Change: and thank you all for joining us for our second quarter two thousand and twenty-four earnings conference call around the exlult

Michael McGarrity: With me today is Ron Kalfus, Chief Financial Officer.

Speaker Change: with me is around cpus chief financial officer

Michael McGarrity: I am pleased to report that our business continued to generate strong financial performance in, the second quarter and first half of 2024, with revenue growth of 32% and 34% respectively over 2023. Our results reflect our continued focus on commercial execution and operating discipline, which we believe will drive sustainable growth through 2024 and beyond.

Michael McGarity: i am pleased to report that our business continued to generate strong financial performance in the second quarter and first half of two thousand and twenty four

Michael McGarity: with revenue growth of thirty-two percent and thirty-four percent perspectively over two thousand and twenty-three

Speaker Change: our results reflect our continued focus on commercial execution and operating thiscifund

Speaker Change: which we believe will drive sustainable growth through two thousand and twenty-four and beyond

Michael McGarrity: On our last call, I noted our strategy of creating multiple sources of growth. That proved to be the case again in Q2, and in a moment I will provide greater detail, on some of the key factors that helped drive our strong performance.

Speaker Change: on our last call i noted our strategy are creating multiple sources of growth

Michael McGarrity: In a moment, I will provide greater detail on some of the key factors that help drive our strong performance. The first, a few brief highlights from our results that support our review, our view that our growth trajectory is sustainable. We reported second quarter revenue of 22.2 million, an increase of 32% over prior year period. Of note, and as I have consistently stated, we have two levers of revenue growth. The first is with our sales team driving year adoption from our ULG customer base. And the second is our market access managed care team driving coverage, which shows up in our average selling price.

Speaker Change: that proved to be the case again in q two in in a moment i will provide greater detail on some of the key factors that helped drive our strong performance

Michael McGarrity: But first, a few brief highlights from our results that support our view that our growth, trajectory is sustainable. We reported second quarter revenue of $22.2 million, an increase of 32% over a prior year, period.

Speaker Change: but first a few re highlightsed from our results that support our review our view that our growth trajectory is sustainable

Speaker Change: we reported second quarter revenue of twenty-two point two million an increase of thirty-two percent over prior year period

Michael McGarrity: Of note, and as I have consistently stated, we have two levers of revenue growth. The first is with our sales team driving unit adoption from our urology customer base, and, the second is our market access managed care team driving coverage, which shows up in our average selling price. In Q2, we clearly delivered on both levers, with total billable test time of approximately, 21,000 tests, representing total test unit growth of 31%.

Speaker Change: but note is out consistently stated we have two levers of revenue growth

Speaker Change: the first is with our sales team driving year adoption from our urology customer base in the second as our market access managed care team driving coverage which shows up in our average selling price

Michael McGarrity: In Q2, we clearly delivered on both levers, with total available test volume of approximately 21,000 tests representing total test unit growth of 31%. These two important metrics clearly underscore the balance and sustainable execution of our commercial team. and the growth opportunity that lies ahead for us is we expand our menu offering in a $5 billion total addressable U.S. market and build our market-leading precision and precision neuralitude diagnosis. Based on the expansion of our business and test menu and an effort to continue to provide good visibility to the market, we are now disclosing volume and growth rates for our menu by segment.

Speaker Change: in q two we clearly delivered on both levers

Speaker Change: with total avbillable test time of approximately twenty-one thousand tests

Michael McGarrity: These two important metrics

Operator: Thank you for your participation.

Speaker Change: representing total test unit growth of thirty-one percent

Michael McGarrity: clearly underscore the balanced and sustainable execution of our commercial team and the growth opportunity that lies ahead for us as we expand our menu offering in a five billion dollar total addressable U.S. market and build our market-leading precision and precision neurology diagnosis.

Speaker Change: is two important metrics clearly underscore the balanced and sustainable execution of our commercial team

Speaker Change: in the growth opportunity that lies ahead for us as we expand our menu offering in a five billion dollars total addressable u s market

Speaker Change: and build our market-leading preision

Speaker Change: in precision diagnostics

Michael McGarrity: Based on the expansion of our business and test menu, in an effort to continue to provide good visibility to the market, we are now disclosing volume and growth rates for our menu by segment. Volume for our tissue-based tests consisting of CONFIRM and GPS achieved 15% year-over-year growth in the second quarter with ASP clearly continuing to accelerate.

Speaker Change: based on the expansion of our business in test mania and an effort to continue to provide good visibility to the market

Speaker Change: we are now disclosing volume in growth rates for our menu by segment

Michael McGarrity: Volume for a tissue-based test, consistent confirm and GPS, achieved 15% year-over-year growth in the second quarter, with ASP clearly continuing to accelerate. A liquid-based test, consistent select and resolved, provided 35% year-growth in Q2 over last year, and we expect to recently introduce a redditary germline test to begin to contribute to growth in this segment of our menu. For context and refresh on the value of our menu driving our growth, I think it is appropriate to characterize the value of each test. Confirm and DX is a tissue-based test performed after a negative biopsy, which is the only test that analyzes each core of the biopsy with our proprietary methylation technology and delivers a result with a 96% negative predictive value.

Speaker Change: volume for our tissue based tus consistent confirm and gb

Speaker Change: achieved fifteen percent year-year growth in the second quarter

Speaker Change: with day asp clearly continuing to accelerate

Michael McGarrity: Our liquid-based tests consisting of SELECT and RESOLVE provided 35% unit growth in Q2 over last year and we expect the recently introduced hereditary germline tests to begin to contribute to growth in this segment of our menu.

Speaker Change: a liquid -bed tests consistent selecting resolve

Speaker Change: provided thirty-five percent growth in q two over last year

Speaker Change: and we expect to recently introduced pre reditary germ line test to begin to contribute to growth in this segment of our menu

Speaker Change: we're context and refresh on the value of our exexpment menu driving our growth

Michael McGarrity: For context and refresh on the value of our expanded menu driving our growth, I think appropriate to characterize the value of each test. CONFIRM MDX is a tissue-based test performed after a negative biopsy which is the only test that analyzes each core of the biopsy with our proprietary methylation technology and delivers a result with a 96% negative predictive value. Additionally, a positive CONFIRM test can identify patients harboring undetected clinically significant prostate cancer which regrettably biopsies miss up to 30% of the time. We are seeing increasing understanding of the importance of this test by our urology customers and by pathologists advocating for the value of CONFIRM after a negative biopsy.

Speaker Change: i think appropriate to characterize the value of each test

Speaker Change: confirm and the x is a tissue-based thus performed after a negative bioy which is the only test that analyzes each core of the bioy with our proprietary methyilation technology and delivers a result with the ninety-six percent negative predicted by

Michael McGarrity: Traditionally, a positive confirmed test can identify patients harboring undetected clinically significant prostate cancer, which were gradually biopsy's mass up to 30% at the time. You're seeing increasing understanding the importance of this test by your urology customers and by pathologists advocating for the value of confirmed after a negative biopsy. Our GPS test is a highly advanced multiplex gene test from tissue following a positive initial biopsy, in which we interrogate the tumor for risk stratification, directing again clinically actionable follow-up by urologists and providing form decision-making for patients. It should be noted that the GPS test has 20-year follow-up data for adverse pathology and prostate cancer-specific mortality and requires materialist tissue than any other test on the market, which is critical to our pathology stakeholders.

Speaker Change: additionally a positive confirmed test can identify patients harboring undetected clinically significant prostate cancer which were regretably biopsiesasoness up to thirty percent at the time

Speaker Change: we are seeing increasing understanding the importance of this test by our urology customers and by pathologists advocicating for the value of confirm after a negative bioasy

Michael McGarrity: Our GPS test is a highly advanced multiplexed gene test from tissue following a, positive initial biopsy in which we interrogate the tumor for risk stratification directing again clinically actionable follow-up by urologists and providing informed decision-making for patients.

Speaker Change: our gpst is a highly advanced mulplac gen test from tissue following a positive initial bioasy in which we interrogate a tumor for risk stratification directing again clinically actionable follow-up buologists

Michael McGarrity: It should be noted that the GPS test has 20-year follow-up data for adverse pathology and prostate cancer specific mortality and requires materially less tissue than any other test on the market which is critical to our pathology stakeholders.

Speaker Change: and providing formed decision-making for patients

Speaker Change: it should be noted that the gpss test has twenty- year follow- up dat for adverse pathology and pressic cancer specific mortality

Speaker Change: and requires a materiial less tissue than any other test on the market

Speaker Change: which is critical to our pathology stakeholders

Michael McGarrity: To be clear, we are the only company that can provide an actionable diagnostic on the other side of initial biopsy, whether positive or negative. As an additional update, I've commented on the complexity of the integration of the GPS test post-acquisition as a carve-out from Exact Sciences. We completed the integration on the Field Sales Organization mid-year 2023, and importantly, we have now completed the laboratory operations transition from the exact Redwood City lab to our MDX Salt lab here in Irvine. Credit to EXACT as our partner in our laboratory and information technology groups for completing this complex transition.

Michael McGarrity: To be clear, we are the only company that can provide an actionable diagnostic on the other side of initial biopsy whether positive or negative.

Speaker Change: to be clear we are the only company that can provide an actionable diagnostic on the other side of initial biopsy whether positive or negative

Michael McGarrity: As an additional update, I commented on the complexity of the integration of the, GPS test post-acquisition as a carve-out from exact sciences.

Speaker Change: as an additional update

Speaker Change: i've commented on the complexity of the integration of the gps test post acquisition as a carbboout from exact sciences

Michael McGarrity: We completed the integration on the field sales organization mid-year 2023, and importantly,

Speaker Change: we completed the integration on the field sales organization mid-year two thousand and twenty-three

Michael McGarrity: we have now completed the laboratory operations transition from the EXACT Redwood City Lab to our MDxHALT Lab here in Irvine. Credit to EXACT as our partner and our laboratory and information technology groups for completing, this complex transition.

Speaker Change: and importantly we have now completed the laboratory operations transition from the exact red wood city lab to earn the xst lab here in herurbine

Speaker Change: credit to exact as our partner that our laboratory and information technology groups while completing this complex transition

Michael McGarrity: We are confident that our diligence and thesis of the value of this acquisition has been realized and will continue to show in our world's trajectory, cementing our offering as the most comprehensive diagnostic menu for the pathway of prostate cancer. On the liquid-based side, our select MDx test is utilized after elevated PSA and can deliver a 95% negative predictive value, potentially avoiding unnecessary biases and associated risks to patients. Our resolve MDx is a year-in-based test for DNA of organisms that can lead to complex and recurrent infections, with 10 million cases of UTI that present annually, 20% of whom present to your algae.

Michael McGarrity: We are confident that our diligence and thesis of the value of this acquisition has been, realized and will continue to show in our growth trajectory, cementing our offering as the most comprehensive diagnostic menu for the pathway of prostate cancer.

Speaker Change: we are confident that our diligence and thesis of the value of this acquisition has been realized and we'will continue to show in our growth' trajectory

Speaker Change: cementing our offering is the most comprehensive diagnostic menu for the pathway of prostate cancer

Michael McGarrity: On the liquid-based side, our SELECT MDx test is utilized after elevated PSA and can, deliver a 95% negative predictive value, potentially avoiding unnecessary biopsies and associated risk to patients.

Speaker Change: on the liquid basase side our select n dx test is legilized after alvative psa and can deliver ninety-five percent negative predictive value

Speaker Change: essentially avoiding unnecessary biopsies and associated risk patients

Michael McGarrity: Our RESOLVE MDx is a urine-based test for DNA of organisms that can lead to complex, and recurrent infections with a 10 million cases of UTI that present annually, 20% of whom present to urology. It is, again, a highly multiplexed test of pathogens and, importantly, also provides, a broad and comprehensive susceptibility profile to treating clinicians, effectively getting to the right drug for the right bug.

Speaker Change: our resolltving in the x is a year-in-basase test for dna of organisms that can lead to complex and recurring and fections for the ten million cases of the uttii that present annually

Speaker Change: twenty percent of whom present teology

Michael McGarrity: It is, again, a highly multiplex test of pathogens, and importantly, also provides a broad and comprehensive susceptibility profile to treating clinicians, effectively getting to the right drug for the right bud. We believe this additional transparency provides a more consistent and granular view of our growth across our business. In addition, Q2 last year was the strongest quarter for the business, and we believe this quarter's unit and revenue growth over that comp reflects both customer understanding of our value proposition, as well as our sales team's execution. Our core technology provides multiple drivers of growth, with our menu covered by Medicare and our prostate cancer tests included in the N60N guidelines.

Speaker Change: it is again a highly multiplex test of pathogens and importantly also provides a broad and comprehensive susceptibility profile to treating clinicians

Speaker Change: effectively getting to the right drug for the right boud

Michael McGarrity: We believe this additional transparency provides a more consistent and granular view of our, growth across our business.

Speaker Change: we believe this additional transparency provides a more consistent in branular view of our growth across our business

Michael McGarrity: In addition, Q2 of last year was the strongest quarter for the business, and we believe this, quarter's unit and revenue growth over that comp reflects both customer understanding of our value proposition as well as our sales team's execution.

Speaker Change: in addition q two of last year was the strongest quarter for the business and we believe this quarter's unit and revenue growth over that comp reflects both customer understanding of our value proposition as well as our sales teams execution

Michael McGarrity: Our core technology provides multiple drivers of growth, with our menu covered by Medicare, and our prostate cancer test included in the NCCN guidelines.

Speaker Change: our core technology provides multiple drivers of growth with our menu covered by medicare and our proross-state cancer test included in the ncand guidelines

Michael McGarrity: So, it is our expanded menu and execution that serves as a basis for our recently raised 2024 revenue guidance to $85 to $87 million, from the initial $79 to $81 million provided at the beginning of this year. This new guidance represents greater than 20% year-over-year top-line growth, which we view as a long-term sustainable goal.

Michael McGarrity: So it is our expanded menu and execution that serve as a basis for our recently raised 2024, revenue guidance to $85 to $87 million, from the initial $79 to $81 million provided at the beginning of this year.

Speaker Change: so it is our expanded menu and execution that serves basis for our recently raised two thousand and twenty-four revenue guidance to eighty-five to eighty- seven million dollars

Speaker Change: from the initial seventy-nine to eighty-one million dollars provided atthe beginning of this year

Michael McGarrity: This new guidance represents greater than 20% year-over-year top-line growth, which, we view as a long-term sustainable goal.

Speaker Change: this new guidance represents creative than twenty percent year-over-your top line growth which we view is a long-term sustainable goal

Michael McGarrity: In a moment, I will provide some closing comments on the considerable progress we have made, as well as our view forward.

Michael McGarrity: In a moment, I will provide some closing comments on the considerable progress we have made, as well as our view forward, but first let me turn the call over to Ron for a brief review of our financial and operating results for Q2.

Speaker Change: in a moment willprovidide some closing comments on the considerable progress we have made as well as our view forward the first let me turn the call over to irran for a brief review of our financial and the operating results for q two right

Michael McGarrity: The first one, I'm going to turn the call over to Ron for a brief review of our financial and operating results for Q2, right?

Operator: Ron?

Ron Kalfus: Thank you, Mike.

Ron Kalfus: Thank you, Mike. To follow on Mike's remarks, we are very pleased to report strong performance in the second quarter of 2024. Prevenues for the second quarter ended June 30, 2024, increased by a robust 32% to $22.2 million versus $16.7 million for the first quarter of 2023. All of this growth was organic and delivered without expansion over our sales organization, which is a testament to the leverage we are generating from our sales channel and reflects greater market penetration.

Ron Kalfus: To follow on Mike's remarks, we are very pleased to report strong performance in the second quarter of 2024. Revenues for the second quarter ended June 30, 2024, increased by a robust 32% to $22.2, million versus $16.7 million for the first quarter of 2023. All of this growth was organic and delivered without expansion of our sales organization, which is a testament to the leverage we are generating from our sales channel and reflects greater market penetration of our full line of tests into the $5 billion U.S. addressable market. Revenue from our tissue-based test made up approximately 81% of our Q2 2024 revenue.

Irran: thank you mike to follow in mikes remarks we are very pleased to report strong performance and the second quarter of two thousand and twenty -four

Irran: revenues for the second quarter ended dune thirty two thousand and twenty four increased by a robust thirty two percent to twenty two point two million dollars versus sixteen point seven million dollars for the first quarter of two thousand and twenty three

Irran: all of this growth was organic and delivered without expansion of our sales organization

Irran: which is a testament as a leverage we are generating from our sales channel and reflects greater market penetration

Ron Kalfus: of our full line of tests into the $5 billion U.S. addressable market. Revenue from our T-shirt-based tests made up approximately 81% of our Q2-2024 revenue.

Irran: of our full line attests into the five biondoll was addressable market

Irran: revenue from our tissu -based test made up approximately anyy-one percent of our q two two thousand and twenty-four revenue

Ron Kalfus: It should be noted that the weekly introduced hereditary germline test did not contribute to our growth for the second quarter, and as stated previously, we expected it to contribute to our revenues in the second half of the year. Moving below the revenue line, our growth profit for the second quarter of 2024 was $13.3 million, an increase of 33% as compared to $10 million for the second quarter of 2023. Gross margins were 60% for the second quarter of 2024, S. compared to 59.7% for the second quarter of 2023. Operating loss for the second quarter was $7.4 million, compared to $7.7 million for the second quarter of 2023, representing a reduction of 4% driven by top line growth, improved gross margins, and continued operating discipline.

Ron Kalfus: It should be noted that the recently introduced hereditary germline test did not contribute, to our growth for the second quarter, and as stated previously, we expect it to begin to contribute to our revenues in the second half of the year.

Irran: it should be noted but the recently introduced reditary germ line test did not contribute to our growth for the second quarter and that's stated previously we expect toific ate to contribute to our revenues in the second half of the year

Ron Kalfus: Moving below the revenue line, our gross profit for the second quarter of 2024 was $13.3 million, an increase of 33% as compared to $10 million for the second quarter of 2023. Gross margins were 60% for the second quarter of 2024 as compared to 59.7% for the second, quarter of 2023. Operating loss for the second quarter was $7.4 million compared to $7.7 million for, the second quarter of 2023, representing a reduction of 4% driven by top-line growth, improved gross margins, and continued operating discipline.

Irran: moving below the revenue line

Irran: our gross profit for the second quarter of two thousand and twenty four was thirteen point three million dollars an increase of thirty-three percent as compared to ten billion dollars for the second quarter two thousand and twenty-three

Irran: g margins were sixty percent for the second quarter two thousand and twenty-four as compared to fifty-nine point seven percent for the second quarter two thousand and twent three

Speaker Change: operating loss for the second quarter was seven point four million dollars compared to seven point seven ill dollars for the second quarter oftwo and y three representing a reduction of four percent driven by top line growth improved grossth margins and continued operating discipline

Ron Kalfus: Caching cash equivalence as of June 30, 2024, was $21.3 million.

Ron Kalfus: Cash and cash equivalents as of June 30, 2024 were $21.3 million.

Speaker Change: cash and cash equivalents as of june thirty two thousand and twenty-four were twenty-one point three million dollars

Ron Kalfus: This concludes my brief overview of the results. Now, we turn the call back to life.

Ron Kalfus: This concludes my brief overview of the results, and I will now turn the call back to Mike.

Speaker Change: this concludes my grief overview of the results now i'will now turn the call back to my

Michael McGarrity: Thanks, Ron. Our top line revenue growth of 32% in the second quarter speaks to multiple positive factors that are driving our business and positioning our company for long-term growth. These factors include the strength of our underlying precision diagnostics technology, the incomparable breadth of our menu offering, the extraordinary network of relationships that we have built with healthcare providers, recognized and expanded reimbursement for our tests, and of course the significant opportunity for growth from the precision diagnostics and markets.

Michael McGarrity: Thanks, Ron.

Michael McGarrity: Our top-line revenue growth of 32% in the second quarter speaks to multiple positive, factors that are driving our business and positioning our company for long-term growth. These factors include the strength of our underlying precision diagnostics technology, the incomparable breadth of our menu offering, the extraordinary network of relationships that we have built with healthcare providers, recognized and expanded reimbursement for our tests, and, of course, the significant opportunity for growth from the precision diagnostics and markets.

Speaker Change: thankr

Speaker Change: our timeline revenue growth of thirty-two percent in the second quarter speaks to multiple positive factors that are driving our business in positioning our company for long-term growth

Speaker Change: these factors include include the strength of our underlying precision diagnostics technology the incomparable breadth of our menu offering the extraordinary network of relationships that we have built with health care providers

Speaker Change: recognized an expanded reimbursement for our tests

Speaker Change: and of course the significant opportunity for growth from the precision diagnostics and markets

Michael McGarrity: Our menu has been custom-built to have fun and early change of the confounding and complex diagnosis of prostate cancer and be more effectively navigated for both clinician and patient. Each year, our technology is enabling a growing number of patients and their physicians to make better informed and personalized treatment decisions. What is clear is that the adoption of precision diagnostics is only accelerating, and we believe we are in commonly positioned to take advantage of these long-term sustainable trends in the high growth throughout your market.

Michael McGarrity: Our menu has been custom-built to help fundamentally change how the confounding and complex diagnosis, of prostate cancer can be more effectively navigated for both clinician and patient. Each year, our technology is enabling a growing number of patients and their physicians to, make better-informed and personalized treatment decisions.

Speaker Change: our menu has been custom b to have fundamentally change of the confounding and complex diagnosis of prostate cancer

Speaker Change: and be more effectively navigated for both clinician and patient

Speaker Change: each year our technology is enabling a growing number of patients and their physicians

Speaker Change: to make better informed and personalized treatment decisions

Michael McGarrity: What is clear is that the adoption of precision diagnostics is only accelerating, and we believe, we are uncommonly positioned to take advantage of these long-term, sustainable trends in the high-growth urology market.

Speaker Change: but is clear is that the adoption of precision diagnostics is only accelerating and we believe we are uncommonly positioned to take advantage of these long term sustainable trends in the high growth throughoutlogy market

Michael McGarrity: I will again comment that our inside mission is that there is a patient and family on the other side of every sample we receive. With that in mind, we pass the friends and family test. That is, if you have a friend or family member being worked up for potential prostate cancer, you want them on our menu and pathway front to back, full stop. And as always, we carry great-deal responsibility to provide value to all of our stakeholders, including patients, customers, payers, and shareholders.

Michael McGarrity: I will again comment that our inside mission is that there is a patient and family on the, other side of every sample we receive.

Speaker Change: i will then comment that our inside mission is that there is a patient and family on the other side of every sample we receive

Michael McGarrity: With that in mind, we pass the friends and family test.

Speaker Change: we've got mind because the friendons of family touask

Michael McGarrity: That is, if you have a friend or family member being worked up for potential prostate cancer, you want them on our menu and pathway, front to back, full stop.

Speaker Change: that is if you re of a friend or f member of being worked up for potential prostate cancer you want them on our menu and pathway from tobac full stop

Michael McGarrity: And as always, we carry a great deal of responsibility to provide value to all of our stakeholders, including patients, customers, payers, and shareholders.

Speaker Change: and as always we carry a great deal responsibility to provide value all of our stakeholders

Speaker Change: including patients customers payers and shareholders

Operator: So thank you for your interest in as part of MDxHout, and now I'll turn the call back over to Paul for questions.

Michael McGarrity: So thank you for your interest in and support of MDxHealth, and now I'll turn the call back, over to Paul for questions.

Speaker Change: so thank you for your interesting in supporter on the x south and now i'll turn the call back over to paul for questions

Operator: Thank you.

Operator: Thank you.

Operator: We'll now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions.

Operator: Well, now we're conducting a question and answer session.

Speaker Change: thank you we'll now we can du a question and answer session if you would like to ask a question please press star one on your telephone keypapat the confiration tonone will indicate your lineinesis in the question q and may press ar two to remove your question from the queq for participants evenason speakerequipment and maybe necessary to pick upyour handset before pressing the ar keys

Operator: If you would like to ask a question, please press star 1 on your telephone keypad.

Operator: A confirmation tone will indicate your line is in the question queue.

Operator: You may press star 2 to remove your question from the queue.

Operator: For participants using speaker equipment, it may be necessary to pick up your handset, before pressing the star keys.

Operator: One moment, please, while we poll for questions.

Speaker Change: one moment pleased while we pull for questions

Operator: Thank you.

Operator: Thank you.

Andrew Brackmann: Our first question is from Andrew Brackmann with William Blair. Please proceed with your question. Hi guys. Good afternoon. Thanks for taking the questions. Maybe to start here, you're obviously seeing some nice tick-ups and volume on both sides of the business and the tissue and liquid side of things. But can you maybe just sort of talk about the drivers of this on the account level?

Operator: Our first question is from Andrew Brackmann with William Blair.

Speaker Change: thank you our first question is from andrew brackman with william blair please prece your question

Andrew Brackmann: Please proceed with your question.

Andrew Brackmann: Hi, guys.

Andrew Brackmann: Good afternoon.

Andrew Brackmann: Thanks for taking the question.

Andrew Brackmann: Maybe to start here, you're obviously seeing some nice tick-ups in volume on both sides, of the business, on the tissue and the liquid side of things, but can you maybe just sort of talk about the drivers of this on the account level?

Andrew Brackman: i gu good afternoon andthanks for taking any question

Speaker Change: maybe 'll start here you're obviously see in somems ightnice tickup and volume on both sides of the business on the tissue and liquids side of things

Speaker Change: but can you maybe just sortof talk about the drivers of this on the account level what are sort of that what do you sort of seeing in terms of compliance towards the overall men and i guess how do you of think about furtherlearning that along in the backhalf of this year the twenty five

Andrew Brackmann: What are sort of what are you sort of seeing in terms of compliance towards the overall menu and I guess how do you sort of think about furthering that along in the back after this year in the 25th? Thanks.

Andrew Brackmann: What are sort of – what are you sort of seeing in terms of compliance towards the, overall menu, and I guess, how do you sort of think about furthering that along in the back half of this year, in the 25?

Andrew Brackmann: Thanks.

Michael McGarrity: So thanks, Andrew. Yeah, I think we feel two things. One, our urology customer base. We really advanced the pathway. It was previously in a number of years ago, was a lot of docs trying tests and reps having to follow up. We've really driven compliance to the term you use to our pathway where it really becomes a if this then.

Michael McGarrity: Thanks, Andrew.

Michael McGarrity: Yeah.

Michael McGarrity: You know, I think we feel two things.

Ander: butthanks ander yes you know i think we we feel

Michael McGarrity: One, our urology customer base, you know, we've really advanced the pathway, right?

Speaker Change: two things one or our uorology customer base we really advanced but path by wr it was

Michael McGarrity: It was previously in – a number of years ago, it was a lot of docs trying tests and, reps having to follow up.

Speaker Change: previously andin

Speaker Change: thea number of years ago was of the lotofdoxs trying to send reps having to follow up we've really driven compliance to the term of use

Michael McGarrity: We've really driven compliance, to the term you used, to our pathway, where it really, becomes a if-this-then.

Michael McGarrity: And – but probably a more material change I would note is our embracing of engagement, with and network of pathology, right, because what we are seeing and what's showing up in our numbers that we believe is sustainable is I would say that our relationships, access, and our pathology customers is becoming as strong as our urology.

Speaker Change: to our pathway really becomes if this then and but private more material change i would notice our embracing obligagement with and

Michael McGarrity: And but probably more material change I would notice our embracing of engagement with and in network of pathology, right? Because what we are seeing and what's showing up in our numbers that we believe is sustainable. I would say that our relationships access influence and our pathology customers is becoming as strong as our urology. And some of these pathology groups serve multiple urology group practices. So we're generating real leverage there. And I think the understanding by pathology of the value of confirm that it's not a misread by the pathologist. It's the limitations of finite sampling of tissue from a biopsy, which samples less than one percent of the prostate.

Speaker Change: in the network of pathology right because what we are seeing and what's showing up in our numbers that we believe stainable i would say that our relationships access influence

Speaker Change: in our pathology customers is becoming as strong as our neurology in some of these techthnology groups serve

Michael McGarrity: And some of these pathology groups serve multiple urology group practices, so we're generating, real leverage there.

Speaker Change: multiplelieroor practices so we're generating real leverage there and i think the understanding by pathology of the value of confirm that it's not a mis

Michael McGarrity: And I think the understanding by pathology of the value of CONFIRM, that it's not a, missed read by the pathologist, right? It's the limitations of the finite sampling of tissue from a biopsy, which, you know, holds less than 1% of the prostate.

Speaker Change: read by the pathologist right it's it's the limitations with finite sampling of tissue from a biopsxy which samples less than one percent ofthe prostate

Michael McGarrity: And I think that understanding and engagement between urology and pathology has made all, the difference, candidly.

Michael McGarrity: And I think that understanding and engagement between urology and pathology has made all the difference. And we're really confident that both ways both confirm and GPS and GPS, and I pointed to some of the features, but that tissue requirement is a big deal for pathologist. Right, preserving the limited tissue that they have from the biopsy is very important characteristics of the GPS. So it all kind of holds together in our sales team has got a strong building a strong hold with both urology and pathology when you have it coming from both ways. We're seeing that be a really compelling driver why we see this growth rate continue.

Speaker Change: and i think that understanding and engagement between neuallogy and pathology has

Michael McGarrity: And we're really confident that both ways, both CONFIRM and GPS, and GPS, you know, I, pointed to some of the features, but that tissue requirement is a big deal for pathologists, right?

Speaker Change: has made all the different scandidally and we're really confident that both ways both confirm gpps and gpps and i finded to some of the futures but that tissue requirement

Michael McGarrity: Preserving the limited tissue that they have from the biopsy is a very important characteristic, of the GPS closet.

Speaker Change: is a big deal for cthologist right preserving a limited tissue that they have from the biopsy is very important characteristics it but the gps posive so it all kind of holds together in our sales team has got a strong

Michael McGarrity: So it all kind of holds together, and our sales team has got a strong, building a strong, hold with both urology and pathology.

Speaker Change: building a strong old with bothterural techthology when you haveven a coming from both ways we're seeing that

Michael McGarrity: When you have it coming from both ways, we're seeing that, be a really compelling driver to why we see this growth rate continue.

Speaker Change: be a really comlling driver or why we see this this growth rate continuue

Andrew Brackmann: Perfect.

Andrew Brackmann: Perfect.

Andrew Brackmann: And then maybe just on the pricing side of things, you're obviously caught up market access and your efforts there, but can you maybe just give us a little bit more color around how much room you think is left to move ASPs higher for the portfolio, be that from further market access and coverage decisions or even just improved revenue cycle management. Thank you. Yeah, Andrew, it's both, right? So we've seen both, right? Our, we have room, right? So our, our Medicare rates for confirmed GPS in the RASP is associated with broader commercial private payer coverage, as well as our revenue cycle management ability to drive compliance to the contracts we have. Even if they're out of network, it has made a big difference and we have a lot of room to go there with coverage. In fact, you're often looking at a coverage decision but not medical policies, so there can be a two-step process to coverage by certain payers.

Speaker Change: perfect and then maybe just on the on the pricing side of things you obviously caught out market access

Andrew Brackmann: And then maybe just on the pricing side of things, you obviously called out market access, and your efforts there, but can you maybe just give us a little bit more color around how much room you think is left to move ASPs higher for the portfolio, be that from further market access and coverage decisions or even just improved revenue cycle management?

Speaker Change: and your efforts there but you youmaybejust give us a little bit more color around how much room you think is left to move asps higher for the portfolio be that from further market access and coverage decisions or even just improved revenue tle management

Andrew Brackmann: Thanks.

Speaker Change: gandrid's both right so and we've seen both right our

Speaker Change: we have room so our medicare rates for confirm a gps in then our asp associated with broader commercial private payer coverage as well as our revenue cycle management ability to

Speaker Change: drive compliance to the contracts we have even if they're out of network

Speaker Change: has made a big difference and we have we have a lot of room to go there with coverage and in fact you often look at a a coverage decision but not medical policy so there can be a two step process to coverage by certain pirs

Michael McGarrity: And that shows up in the acceleration of the ASP even by payer. So a contract payer, we may get a rate, and then we'll get a policy that rate becomes more favorable. So we believe we have room there, and we're seeing it across each of our tasks. So when I, when I speak to the value of the sales team but also our, our managed care team, all the levers are working.

Speaker Change: in that shows up in the acceleration of the asp even by payer so a pper contract payer you may get a raise and then we'll get in policy that ak becomes more favorable so we believe we have room there

Speaker Change: and we're seeing it across each part tasks so what i might speak to the value of the sales am but also our managed care team

Michael McGarrity: Yeah, Andrew, it's both, right?

Andrew Brackmann: Great, thank you. Thanks, Andrew.

Speaker Change: all the levers are working

Speaker Change: great thanks you

Speaker Change: nine seven

Mark Massaro: Thank you. Our next question is from Mark Massaro with BTIG. Please proceed with your question. Hi, guys.

Michael McGarrity: And we've seen both, right?

Speaker Change: thank you howard next question is remark messarra with btii please proceed with your question

Michael McGarrity: We have room, right?

Vivian: This is Vivian. I'm from Mark. Thanks for taking me to question. So I just, the volume breakouts were just a little bit different than the buckets we had. Can you just give us any qualitative color on relative areas of strength in the quarter? I understand that resolve volumes, in particular, has been beating us for a while, so just curious to get anything to call out there.

Speaker Change: ok this is b ans mark thank you re taking the question

mark messarra: i guess the volume breakouts for just a little bit difference than the buckets we had can you just give us any qualitative color on relative areas of strength in the quarter

Speaker Change: i understand that result of volume in particular has been beating us for a while so just carious to get anything to call out there

Michael McGarrity: Vivian, so we could really move from unit revenue by test for, which we've discussed, probably more for competitive market reasons, but we feel like this is a, you know, really good way to provide better visibility to our menu bills, and it's driven by a couple things. One is when you look at the pricing of the tissue-based versus the liquid based test, it's materially different, right? So we think that gives you better visibility as far as our unit growth rate. Again, I would point to the comp of Q2 over Q2 last year.

Speaker Change: yes viv so we clearly moved from unit revenue by test for which we've discussed

Speaker Change: prim more for competitive market reasons but we feel like this is

Viv: areally good way to provide better visibility to our menu bills and it's driven by a couple of things as one is when you look at the pricing of the tissue basase versus the liquid based test

Speaker Change: it's materially different right so we think that gives you better visibility as far as our our unit growth rate again i would point to the comp of q two over q two last year so we think these growth rates

Michael McGarrity: So we think these growth rates and acceleration revenue are very, very sustainable across our menu. So from a correspondingly, our ASPs are significantly higher than Select and Resolve. So we are seeing continued growth across our menu for the most part in Resolve. And we have a lot of room in each of those markets.

Speaker Change: and acceleration revenue are very very sustainable across across our menu so from a tissue perspective the medicare rates for gps and confirmand corresponding r asssp are significantly higher than

Michael McGarrity: So our Medicare rates for confirming GPS and then our ASP associated with broader commercial private payer coverage, as well as our revenue cycle management's ability to drive compliance to the contracts we have, even if they're out of network, has made a big difference.

Michael McGarrity: And we have a lot of room to go there with coverage.

Michael McGarrity: And in fact, you often will get a coverage decision, but not medical policy. So there can be a two-step process to coverage by certain payers.

Speaker Change: select and resollve so we are seeing continued growth

Michael McGarrity: And that shows up in the acceleration of the ASP, even by payer.

Michael McGarrity: So a contract payer, we may get a rate and then when we get in policy, that rate becomes more favorable.

Speaker Change: across our menu for the most part and resolve

Michael McGarrity: So we believe we have room there and we're seeing it across each of our tests.

Michael McGarrity: So what confidence that this gives better visibility for comparison purposes as we go forward in better detail on how the menu, as we've extended it, which I think is somewhat uncommon, contributes and builds up to our reported revenue and just as importantly are viewed forward from a guidance perspective.

Speaker Change: and we'have a lot of room in each of those markets so

Michael McGarrity: So when I speak to the value of the sales team, but also our managed care team, all the levers are working.

Speaker Change: we're confident that this gives better visibility for comparison purposes that we go forward in better detail on how the menu is we've expanded it which i think is someof to common contributes and builds up to our

Andrew Brackmann: Great.

Andrew Brackmann: Thanks, guys.

Speaker Change: our reported revenue and just as importantly our view forward from the guidance perspective

Andrew Brackmann: Thanks, Andrew.

Operator: Greetings, and welcome to the MDx Health Second Course. Welcome to the MDx Health Second Course, and welcome to the MDx Health Second Course.

Andrew Brackmann: Thank you.

Vivian: Thank you. Okay, perfect. Understood. Thanks for the color.

Speaker Change: ok perfect understood thanks for the color

Mark Massaro: And just to follow up, this one is a little bit nitpicky. That, you know, it was a bigger quarter ready-wise, but it didn't seem to drop down the gross margins as well as it has historically. I think that would just be driven by the test mix, but just any other variables to call out on the gross margins. No other variables, strictly the timing mix and its mix of not only is there met again, is there menus expanded? The mix becomes more, you know, more relevant as far as the quarter-by-quarter gross margin, but also the pair mix that comes across.

Speaker Change: and just will follow up thisone is a little bit mit picicky but it was a bigger quarter readyue wise but it didn't seem to drop down a gross margins as well as it had historically

Speaker Change: i think that would just be driven by the test mix but i m just any other variables to call on the growth margin

Operator: These risks and uncertainties are detailed in the risk factor section of our filings with the Securities and Exchange Commission, specifically in the company's annual report on Form 10 on Form 20 F.

Speaker Change: more relevantthan as far as the quarter by quarter gross barin but also the payer mix that comes across so it's a permutation of expanded menu and payer iexpect quarter but

Operator: I would now like to turn the call over to Michael McGarrity, CEO. Thank you, Michael. You may begin. Thanks, Paul.

Ron Kalfus: So it's a permutation of expanded venue and pair mix by quarter, but no material change.

Michael McGarrity: And thank you all for joining us for our second quarter, 2024, earnings conference call for MDx Health.

Mark Massaro: Thank you. Great. Thanks for taking the question.

Speaker Change: no material change there

Thomas Brackmann: Thank you. Our next question is from Thomas Brackmann with KBC Securities. Please proceed with your question. I think you're taking my question, and congrats on the nice growth rates again. Maybe two questions from my side. The first one is whether you could give a bit more insight in exactly where you stand with the integration of that germline testing. What are the steps that are needed or that still need to be taken to reach out that revenue contribution as of H2? Secondly, I also wanted to pick back up on a comment that you made a couple of months ago with regards to potentially other looking at additional opportunities to expand the testing menu.

Michael McGarrity: With me today is Ron Kalfus, Chief Financial Officer. I am pleased to report that our business continued to generate strong financial performance in the second quarter and first half of 2024. With revenue growth of 32% and 34% respectively over 2023. Our results reflect our continued focus on commercial execution and operating discipline, which we believe will drive sustainable growth through 2024 and beyond. On our last call, I noted our strategy of creating multiple sources of growth that proved to be the case again in Q2.

Speaker Change: great thanks you the question

Speaker Change: thanks sothat

Operator: Our next question is from Mark Massaro with BTIG.

Speaker Change: thank you our next question is from thcomomas banking with kbc securities please proceive with your question

Operator: Please proceed with your question.

Speaker Change: thanks for taking my question and congress on the nice growro rates again maybe two questions from my side the first one is well you could give a bit more insight and exactly where you stand with the integration of that germ line testing what are the steps are needed that need to be taken to to reach that revenue can contribution as a page to

Vivian: Hey, guys.

Speaker Change: and then secondly i also wanted to pick that up on on a comment that you made a couple of monthsao which regards to air potentially are looking at additional opportunities to expand ed testing menu given the fact that the test has been added what is now your current outlook into let'ssay the rest of the year and maybe next year with regarddss to evaluating additional opportunities thank you

Michael McGarrity: In a moment, I will provide greater detail on some of the key factors that help drive our strong performance. The first, a few brief highlights from our results that support our review, our view that our growth trajectory is sustainable. We reported second quarter revenue of 22.2 million, an increase of 32% over prior year period. Of note, and as I have consistently stated, we have two levers of revenue growth. The first is with our sales team driving year adoption from our ULG customer base.

Thomas Brackmann: Given the fact that the test has been added to what is now your current outlook into, let's say, the rest of the year and maybe next year with regards to evaluating additional opportunities. Thank you. Next time, yes.

Michael McGarrity: First, the germline we communicated, which is the way we take these new opportunities, where we engage in a limited launch. And that's really too cold. Want to confirm our diligence and to get some experience with our sales organization and limited launch. To be able to be able to roll out. So we're in that phase. Now in Q3, we have received samples. We also like to get it as you know, Thomas, about a quarter of history of air mix coverage and historical gets a history of payments. Even with Medicare, we did the same thing with Slack last year.

Speaker Change: exas

Speaker Change: yes as first as the germanine you we communicated which is we're just the way we take these new opportunities where we engage limited launch and that's really two cold want to confirm our diligence

Speaker Change: and to get some experience with our sales organization limited launch

Michael McGarrity: And the second is our market access managed care team driving coverage, which shows up in our average selling price. In Q2, we clearly delivered on both levers, with total available test volume of approximately 21,000 tests representing total test unit growth of 31%. These two important metrics clearly underscore the balance and sustainable execution of our commercial team, and the growth opportunity that lies ahead for us is we expand our menu offering in a $5 billion total addressable U.S, market and build our market-leading precision and precision neuralitude diagnosis.

Speaker Change: to be to be able to roll out so we're in that phase now in q three we have received samples we also like together as you know thomas

Speaker Change: about a quarter of history of a faayer mix

Speaker Change: coverage and historical gets a history of payments even with medicare we did the same thing would like last year

Michael McGarrity: So we again feel like we'll begin to report revenue contribution in the second half of this year and probably then be able to give you a better visibility as to how it contributes to our overall view forward. But we like to fit for sure, with our menu offering. And again, I would point to the fact that that concept, not unlike resolve, came from our customers, right? All the good ideas come from the people in the field, whether it be our reps or customers. And that's a good example. That as far as the second part of your question, our growth opportunities.

Speaker Change: so we again feel like we'll begin to report revenue contribution

Speaker Change: in the second half of this year and pride then be able to give you a better visibility is to contribute to our overall be forward but

Speaker Change: we like to fit for for sure were there menu offering and again i would point the fact that that that concept not unlike resolve

Speaker Change: came to us from our customers all the good ideas come from the people to feel whe bour raps or customers and that's a good example that as far as the second part of your question our growth opportunities when

Michael McGarrity: Based on the expansion of our business and test menu and an effort to continue to provide good visibility to the market, we are now disclosing volume and growth rates for our menu by segment. Volume for a tissue-based test, consistent confirm and GPS, achieved 15% year-over-year growth in the second quarter, with ASP clearly continuing to accelerate. A liquid-based test, consistent select and resolved, provided 35% year-growth in Q2 over last year, and we expect to recently introduce a redditary germline test to begin to contribute to growth in this segment of our menu.

Michael McGarrity: You know, I'm careful there, but we have them, right? So I'll provide the detail, right? I think I've commented before, and we want to go a strategy process here. We have, over the last two years, been always looking out as to what's out there that we think is interesting. It's also can't really an unintended consequence exercise to make sure we don't miss something, both from our current menu, offering competitively and where the direction of the market goes, but for the new opportunities. And I think the strength of our channel and our customer base and our access and influence has flipped that from us always looking out on to inbound.

Speaker Change: i'm careful there but we have that right so

Speaker Change: i'll provide the detail does i think our commented before and we want to grow strategy process here

Speaker Change: we have were last two years and we are always looking out as to what's out there that we think is interesting also carely andan inttenended counts forats exercise to make sure don't miss something

Speaker Change: both from our current menu offering competitively and where the direction of the market goes but for new opportunities and i think

Speaker Change: the strength of our channel and our customer base and our access and influence

Speaker Change: as' flipped that from us always looking out on two inboundt

Michael McGarrity: For context and refresh on the value of our menu driving our growth, I think appropriate to characterize the value of each test. Confirm and DX is a tissue-based test performed after a negative biopsy, which is the only test that analyzes each core of the biopsy with our proprietary methylation technology and delivers a result with a 96% negative predictive value. Traditionally, a positive confirmed test can identify patients harboring undetected clinically significant prostate cancer, which were gradually biopsy's mass up to 30% at the time.

Michael McGarrity: But we're very careful and focused in our diligence process for these opportunities, but if you may be assumption, I'm communicated that we have a dashboard of opportunities that we evaluate. But we have an even more rigorous process to before we take anything to market or engage in any sort of partnership for distribution or strategic partnership.

Speaker Change: but we're very careful and focused in our diligence process for these opportunities but

Speaker Change: if if you made the assumption and communicated that we have a dashboard of opportunities that

Speaker Change: wherere we evaluate but we haveven any more riggorous process to before we take anything to market or engage and sort of

Speaker Change: partnership for distribution or strategic partnership

Michael McGarrity: I'll make one more comment that I think you'd be okay with, but you know, you saw the recent addition to a board of Sandy Seagull. And, you know, I would say that already having someone like that on our side, on our team, and supporting our marketing group or relationships started with. Jeff Lano and Ken Conley and the credibility they build with our community leaders and having not only an accomplished practitioner and clinician, but somebody who clearly can see beyond where the market used to be, where it is today, and where it's headed. So we like our set up there.

Speaker Change: i make one more commentsthat

Speaker Change: i think you'd be okay with but you know you saw the recent addition or a board of of sanandy ciele and you know i would say that already

Speaker Change: put someone like that on our side on our team in supporting our marketing group our relationships started with

Michael McGarrity: You're seeing increasing understanding the importance of this test by your urology customers and by pathologists advocating for the value of confirmed after a negative biopsy. Our GPS test is a highly advanced multiplex gene test from tissue following a positive initial biopsy, in which we interrogate the tumor for risk stratification, directing again clinically actionable follow-up by urologists and providing form decision-making for patients. It should be noted that the GPS test has 20 year follow-up data for adverse pathology and prostate cancer-specific mortality and requires materialist tissue than any other test on the market, which is critical to our pathology stakeholders.

Speaker Change: jumble on own can comedy and the credibility they built with our with our cubvenian leaders

Speaker Change: in having not only accomplished practitioner and clinician but some body who clearly can conceive beyond where the market you spebe where itis today and where it'sexcited so we like our set up there

Thomas Brackmann: And if you may be assumption that our menu will look different. Two years from now, as it does very different two years prior, where we had one test generating rather than I think that's a reasonable assumption. Hopefully, that answered your question times. Yes, very clear. Thank you very much. Thank you so much.

Speaker Change: and if you may the assumption that our menu will look different

Speaker Change: two years from now as it does very different two years prior where we had one test genering whether i think that's a reasonable assumption

Speaker Change: so fully had toanswer your question times

Speaker Change: yess very gre thank you very much i much appreciate

Thomas Brackmann: Thanks.

Operator: Thank you.

Speaker Change: excellons

Jason Bednar: Our next question is from Jason Bednar with Piper Sandler. Please proceed with your question.

Vivian: This is Vivian.

Speaker Change: but thank you our next question is from jason bednar with piper sandl please prefer your question

Vivian: I'm from Mark.

Michael McGarrity: To be clear, we are the only company that can provide an actionable diagnostic on the other side of initial biopsy, whether positive or negative. As an additional update, I've commented on the complexity of the integration of the GPS test post acquisition as a carve-out from exact sciences. We completed the integration on the Field Sales Organization mid-year 2023, and importantly, we have now completed the laboratory operations transition from the exact redwood city lab to our MDX salt lab here in Irvine.

Jason Bednar: Hey guys, are you okay? Yes, Jason.

Vivian: Thanks for taking the question.

Vivian: So I guess the volume breakouts were just a little bit different than the buckets we had.

Speaker Change: they got herear me okay

Jason Bednar: Great. It's one of the two questions. I'll ask you both up front here, and sorry for your background noise, but I just want to ask on pace of volume activity during the quarter. Just in how that informs your view of the second half of the year, I'm just doing very well here in the first half. And you just want to want to see if there's any strengthening or weakening, or things are pretty stable across the quarter.

Vivian: Can you just give us any qualitative color on relative areas of strength in the quarter?

Speaker Change: yester sting

Vivian: I understand that result volumes in particular have been beating us for a while.

Vivian: So just curious if you had anything to call out there.

Speaker Change: 's one of the ask two partquestionions last goals upfront here and ent any backgroundwaysise but just want to ask on case of volume maactivity during the quarter end how that informs your view the second half of the year iob ious doing very well in the first half and going to want to theres any

Vivian: Thanks.

Michael McGarrity: Yeah, Vivian.

Michael McGarrity: So we've clearly moved from unit revenue by test, which we've discussed, probably more for competitive market reasons.

Michael McGarrity: But we feel like this is a really good way to provide better visibility to our menu bills. And it's driven by a couple of things.

Michael McGarrity: One is when you look at the pricing of the tissue-based versus the liquid-based tests, it's materially different.

Michael McGarrity: So we think that gives you better visibility.

Michael McGarrity: As far as our unit growth rate, again, I would point to the comp of Q2 over Q2 last year.

Speaker Change: strengthening or weakening or think ty stable across across the quarter and this remind us if you could have we where we're at with respect to getting back in normal cepting volume across the industry

Jason Bednar: And just remind us of your code of where we're at with respect to getting back to normal testing volume across the industry.

Ron Kalfus: And then the second question, separate question. Now that we've fully consolidated the GPS operation, there are efficiency benefits that we can expect to see in the second half of the year. Thank you.

Speaker Change: and on the second question separate question was met now that we've beforefully consolid to the g ps operations or are there efficiency benefits that we can expect to see in the second half of the year thank you

Michael McGarrity: Credit to EXACT as our partner in our laboratory and information technology groups for completing this complex transition. We are confident that our diligence and thesis of the value of this acquisition has been realized and will continue to show in our world's trajectory, cementing our offering as the most comprehensive diagnostic menu for the pathway of prostate cancer. On the liquid-based side, our select MDx test is utilized after elevated PSA and can deliver a 95% negative predictive value, potentially avoiding unnecessary biases and associated risked patients.

Michael McGarrity: Thanks, Jason.

Ron Kalfus: Yeah, I'll comment on the second part first. So we've modeled the GPS. Obviously, exact exact was writing the test for us. So there are some economic associated with that. We believe that it's based out of each other as we staffed our laboratory to go live with the GPS test. So we don't see any material favorable or unfavorable impact to the P&L.

Speaker Change: thanks jason yeah i'll comment on the second part of first so we modeled the gpss obviously exact exactly was writing the test for us

Speaker Change: so there were some economics associated with that we believe that it's it's they sol for each other as we staffed our laboratory to go alive with the gpps pl we don't see any material favorable or unfavorable impact

Michael McGarrity: So we think these growth rates and acceleration of revenue are very, very sustainable across, our menu.

Michael McGarrity: and as far as the view for the second half of the year, yeah, we view it as very sustainable. Q3 is always a little bit of a lot of current on the general cautious with how Q3 with even close to endemic more, I guess I would say seasonality with regard to patient flow staffing vacations, but I would not expect any material down term or change. And our trajectory from a growth perspective, probably even with absent any material change in Q3 from a seasonality perspective. So that's the message we're delivering.

Michael McGarrity: So from a tissue perspective, the Medicare rates for GPS and Confirm and correspondingly our ASPs are significantly higher than Select and Resolve.

Speaker Change: to the pnl

Michael McGarrity: So we are seeing continued growth across our menu for the most part in Resolve.

Michael McGarrity: And we have a lot of room in each of those markets.

Michael McGarrity: So we're confident that this gives better visibility for comparison purposes as we go forward in better detail on how the menu as we've expanded it, which I think is somewhat uncommon, contributes and builds up to our reported revenue and just as importantly, our view forward from a guidance perspective.

Speaker Change: and as far as the view for the second half the year we review it as very sustainable q three is always a little bit of a low currenton mo cautious

Vivian: Okay, perfect.

Vivian: I understood.

Vivian: Thanks for the color.

Vivian: And just to follow up, this one is a little bit nitpicky, but it was a bigger quarter revenue-wise, but it didn't seem to drop down the gross margins as well as it has historically.

Vivian: I assume that would just be driven by the test mix, but just any other variables to call out on the gross margins?

Vivian: Thanks.

Michael McGarrity: Our resolve MDx is a year-in-based test for DNA of organisms that can lead to complex and recurrent infections, with a 10 million cases of UTI that present annually, 20% of whom present to your algae. It is, again, a highly multiplex test of pathogens, and importantly, also provides a broad and comprehensive susceptibility profile to treating clinicians, effectively getting to the right drug for the right bud. We believe this additional transparency provides a more consistent and granular view of our growth across our business.

Speaker Change: i would talk three with

Speaker Change: even post send outic more i guess it's kes seasonalvalue with regard to bisent forlowstaffing

Speaker Change: vacations but i would not expect

Speaker Change: any material donterm or changed in our trajectory from a growth perspective probably even with absenting material change in quture from the seasonality perspective so that'sthe msagewe're delivering i thinkit's reflectingin our guidance

Michael McGarrity: No other variables.

Michael McGarrity: It's strictly a timing mix, and it's a mix of not only, again, as our menu's expanded, the mix becomes more relevant as far as the quarter-by-quarter gross margin, but also the payer mix that comes across.

Michael McGarrity: So, it's a permutation of expanded menu and payer mix by quarter, but no material change there.

Michael McGarrity: I think it's reflected in our guidance and our view that I made the comment that internally we believe that we can drive 20% or greater revenue growth in a very, very sustainable way.

Vivian: Great.

Vivian: Thanks for taking the question.

Vivian: Thanks, Vidyun.

Vivian: Thank you.

Operator: Our next question is from Thomas Vranken with KBC Securities.

Operator: Please proceed with your question.

Thomas Vranken: Thanks for taking my question, and congrats on the nice growth rates again.

Thomas Vranken: Maybe two questions from my side.

Thomas Vranken: The first one is whether you could give a bit more insight in exactly where you stand with the integration of that germline testing.

Thomas Vranken: What are the steps that are needed or that still need to be taken to reach that revenue contribution as of H2?

Thomas Vranken: And then secondly, I also wanted to pick back up on a comment that you made a couple of months ago with regards to potentially looking at additional opportunities to expand the testing menu, given the fact that the test has been added.

Thomas Vranken: What is now your current outlook into, let's say, the rest of the year and maybe next year with regards to evaluating additional opportunities?

Michael McGarrity: In addition, Q2 last year was the strongest quarter for the business, and we believe this quarter's unit and revenue growth over that comp reflects both customer understanding of our value proposition, as well as our sales team's execution. Our core technology provides multiple drivers of growth with our menu covered by Medicare and our prostate cancer tests included in the N60N guidelines. So, it is our expanded menu and execution that serves as a basis for our recently raised 2024 revenue guidance to $85 to $87 million from the initial $79 to $81 million provided at the beginning of this year. This new guidance represents greater than 20% year-over-year top-line growth, which we view as a long-term sustainable goal.

Speaker Change: in a very very stable way

Speaker Change: yeah thank you

Speaker Change: thanks listing

Thomas Vranken: Thank you.

Operator: There are no further questions at this time.

Michael McGarrity: Thanks, Thomas.

Michael McGarrity: As far as the germline, we communicated, which is the way we take these new opportunities where we engage in a limited launch, and that's really twofold. One, to confirm our diligence and to get some experience with our sales organization and a limited launch to be able to roll out.

Michael McGarrity: So we're in that phase now in Q3.

Operator: This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.

Speaker Change: thank you there are no further questions at this time this concludes today's conference call you may disconnect your lines at this time thank you for your participation

Michael McGarrity: We have received samples.

Michael McGarrity: We also like to get, as you know, Thomas, about a quarter of history of payer mix coverage and historical, get some history of payments.

Operator: You may disconnect your lines at this time.

Michael McGarrity: Even with Medicare, we did the same thing with Select last year.

Michael McGarrity: So we, again, feel like we'll begin to report revenue contribution in the second half of this year and probably then be able to give you a better visibility as to how it contributes to our overall view forward.

Michael McGarrity: But we like the fit for sure with our menu offering.

Michael McGarrity: And again, I would point to the fact that that concept, not unlike Resolve, came to us from our customers.

Michael McGarrity: All the good ideas come from the people in the field, whether it be our reps or customers, and that's a good example of that.

Michael McGarrity: As far as the second part of your question, our growth opportunities.

Michael McGarrity: I'm careful there, but we have them, right?

Michael McGarrity: So I'll provide the detail, right?

Michael McGarrity: As I think I've commented before, I mean, we run a growth strategy process here.

Michael McGarrity: We have over the last two years, and we were always looking out as to what's out there that we think is interesting. It's also candidly an unattended consequence exercise, to make sure we don't miss something, both from our current menu offering competitively and where the direction of the market goes, but for new opportunities.

Michael McGarrity: And I think the strength of our channel, and our customer base and our access and influence has flipped that from us always looking outbound to inbound, but we're very careful and focused in our diligence process for these opportunities. But if you made the assumption, and I've communicated that we have a dashboard of opportunities that we evaluate, but we have an even more rigorous process before we take anything to market or engage in any sort of partnership for distribution or strategic partnership.

Michael McGarrity: I'll make one more comment that I think you'd be okay with, but you saw the recent addition to our board of Sandy Siegel and I would say that already having someone like that on our side, on our team, and supporting our marketing group, our relationship started with John Bolano and Ken Conley and the credibility they built with our key opinion leaders and having not only an accomplished practitioner and clinician, but somebody who clearly can see beyond where the market used to be, where it is today and where it's headed.

Michael McGarrity: So we like our setup there.

Michael McGarrity: And if you made the assumption, that our menu will look different two years from now, as it does very different two years prior where we had one test generating revenue, I think that's a reasonable assumption.

Michael McGarrity: Hopefully that answered your question, Thomas.

Thomas Vranken: Yes, very clear.

Thomas Vranken: Thank you very much, Mike.

Thomas Vranken: Much appreciated.

Thomas Vranken: Thanks, Thomas.

Thomas Vranken: Thank you.

Operator: Our next question is from Jason Bednar with Piper Sandler.

Operator: Please proceed with your question.

Jason Bednar: Hey guys, can you hear me okay?

Michael McGarrity: Yes, Jason.

Jason Bednar: All right, great.

Jason Bednar: I just wanted to ask two questions.

Jason Bednar: I'll ask them both up front here, and sorry for any background noise, but just want to ask on pace of volume activity during the quarter, just how that informs your view of the second half of the year.

Jason Bednar: Obviously doing very well here in the first half.

Jason Bednar: So just kind of wanted to see if there was any strengthening, or weakening or things were pretty stable across the quarter.

Jason Bednar: And just remind us if you could of where we're at, with respect to getting back to normal testing volumes across the industry.

Jason Bednar: And then the second question, a separate question, now that we've fully consolidated the GPS operations, are there efficiency benefits that we can expect to see in the second half of the year?

Jason Bednar: Thank you.

Michael McGarrity: Thanks, Jason.

Michael McGarrity: Yeah, I'll comment on the second part first.

Michael McGarrity: So we modeled the GPS, obviously Xact was running the test for us.

Michael McGarrity: So there were some economics associated with that.

Michael McGarrity: We believe that they solve for each other, as we staffed our laboratory to go live with the GPS test.

Michael McGarrity: So we don't see any material favorable, or unfavorable impact to the P&L.

Michael McGarrity: And as far as the view for the second half of the year, yeah, we view it as very sustainable.

Michael McGarrity: Q3 is always a little bit of a wild card.

Michael McGarrity: I'm usually a little cautious with how Q3, with even post-pandemic more, I guess I would say, seasonality with regard to patient flow, staffing, vacations, but I would not expect any material downturn or change in our trajectory from a growth perspective, probably even with absent any material change in Q3 from a seasonality perspective.

Michael McGarrity: So that's the message we're delivering.

Michael McGarrity: I think it's reflected in our guidance and our view that, you know, I made the comment that internally we believe that we can drive 20% or greater revenue growth in a very, very sustainable way.

Michael McGarrity: In a moment, I will provide some closing comments on the considerable progress we have made, as well as our view forward.

Jason Bednar: Okay.

Jason Bednar: Thank you.

Jason Bednar: Thanks, Jason.

Jason Bednar: Thank you.

Operator: There are no further questions at this time.

Operator: This concludes today's conference call.

Michael McGarrity: The first one, I'm going to turn the call over to Ron for a brief review of our financial and operating results for Q2, right?

Ron Kalfus: Thank you, Mike. To follow on Mike's remarks, we are very pleased to report strong performance in the second quarter of 2024. Prevenues for the second quarter ended June 30, 2024, increased by a robust 32% to $22.2 million versus $16.7 million for the first quarter of 2023.

Ron Kalfus: All of this growth was organic and delivered without expansion over our sales organization, which is a testament to the leverage we are generating from our sales channel and reflects greater market penetration, of our full line of tests into the $5 billion U.S, addressable market. Revenue from our T-shirt-based tests made up approximately 81% of our Q2-2024 revenue.

Ron Kalfus: It should be noted that the weekly introduced hereditary germline test did not contribute to our growth for the second quarter, and as stated previously, we expected it to contribute to our revenues in the second half of the year. Moving below the revenue line, our growth profit for the second quarter of 2024 was $13.3 million, an increase of 33% as compared to $10 million for the second quarter of 2023. Gross margins were 60% for the second quarter of 2024, S, compared to 59.7% for the second quarter of 2023. Operating loss for the second quarter was $7.4 million, compared to $7.7 million for the second quarter of 2023, representing a reduction of 4% driven by top line growth, improved gross margins, and continued operating discipline.

Ron Kalfus: Caching cash equivalence as of June 30, 2024, was $21.3 million.

Michael McGarrity: This concludes my brief overview of the results now with now turn the call back to life. Thanks, Ron. Our top line revenue growth of 32% in the second quarter speaks to multiple positive factors that are driving our business and positioning our company for long-term growth. These factors include the strength of our underlying precision diagnostics technology, the incomparable breadth of our menu offering, the extraordinary network of relationships that we have built with healthcare providers, recognized and expanded reimbursement for our tests, and of course the significant opportunity for growth from the precision diagnostics and markets.

Michael McGarrity: Our menu has been custom-built to have fun and early change of the confounding and complex diagnosis of prostate cancer and be more effectively navigated for both clinician and patient. Each year, our technology is enabling a growing number of patients and their physicians to make better informed and personalized treatment decisions. What is clear is that the adoption of precision diagnostics is only accelerating and we believe we are in commonly positioned to take advantage of these long-term sustainable trends in the high growth throughout your market.

Michael McGarrity: I will again comment that our inside mission is that there is a patient and family on the other side of every sample we receive. With that in mind, we pass the friends and family test. That is, if you have a friend or family member being worked up for potential prostate cancer, you want them on our menu and pathway front to back, full stop. And as always, we carry great-deal responsibility to provide value to all of our stakeholders, including patients, customers, payers and shareholders.

Michael McGarrity: So thank you for your interest in as part of MDxHout and now I'll turn the call back over to Paul for questions.

Operator: Thank you.

Operator: We'll now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 to remove your question from the queue. For participants using speaker equipment and may be necessary to pick up your hand sip before pressing the star keys. One moment please while we poll for questions.

Operator: Thank you.

Andrew Brackmann: Our first question is from Andrew Brackmann with William Blair. Please proceed with your question. Hi guys. Good afternoon. Thanks for taking the questions. Maybe to start here, you're obviously seeing some nice tick-ups and volume on both sides of the business and the tissue and liquid side of things. But can you maybe just sort of talk about the drivers of this on the account level? What are sort of what are you sort of seeing in terms of compliance towards the overall menu and I guess how do you sort of think about furthering that along in the back after this year in the 25th? Thanks.

Michael McGarrity: So thanks, Andrew. Yeah, I think we feel two things. One, our urology customer base. We really advanced the pathway. It was previously in a number of years ago was a lot of docs trying tests and reps having to follow up. We've really driven compliance to the term you use to our pathway where it really becomes a if this then. And but probably more material change I would notice our embracing of engagement with and in network of pathology right because what we are seeing and what's showing up in our numbers that we believe is sustainable.

Michael McGarrity: I would say that our relationships access influence and our pathology customers is becoming as strong as our urology. And some of these pathology groups serve multiple urology group practices. So we're generating real leverage there. And I think the understanding by pathology of the value of confirm that it's not a misread by the pathologist. It's the limitations of finite sampling of tissue from a biopsy which samples less than one percent of the prostate.

Michael McGarrity: And I think that understanding and engagement between urology and pathology has made all the difference. And we're really confident that both ways both confirm and GPS and GPS and I pointed to some of the features, but that tissue requirement is a big deal for pathologist right preserving the limited tissue that they have from the biopsy is very important characteristics of the GPS. So it all kind of holds together in our sales team has got a strong building a strong hold with both urology and pathology when you have it coming from both ways. We're seeing that be a really compelling driver why we see this growth rate continue.

Andrew Brackmann: Perfect.

Michael McGarrity: And then maybe just on the pricing side of things you're obviously caught up market access and your efforts there, but can you maybe just give us a little bit more color around how much room you think is left to move ASPs higher for the portfolio be that from further market access and coverage decisions or even just improved revenue cycle management. Thank you. Yeah, Andrew, it's both, right? So we've seen both, right?

Michael McGarrity: Our, we have room, right? So our, our Medicare rates for confirmed GPS in the RASP is associated with broader commercial private payer coverage, as well as our revenue cycle management ability to drive compliance to the contracts we have, even if they're out of network has made a big difference and we have a, we have a lot of room to go there with coverage and in fact, you're often looking at a coverage decision but not medical policies so there can be a two-step process to coverage by certain payers.

Michael McGarrity: And that shows up in the acceleration of the ASP even by payer. So a contract payer, we may get a rate and then we'll get a policy that rate becomes more favorable. So we believe we have room there and we're seeing it across each of our tasks. So when I, when I speak to the value of the sales team but also our, our managed care team, all the levers are working.

Andrew Brackmann: Great, thank you. Thanks, Andrew.

Operator: Thank you.

Mark Massaro: Our next question is from Mark Massaro with BTIG. Please proceed with your question. Hi, guys. This is Vivian. I'm from Mark. Thanks for taking me to question. So I just, the volume breakouts were just a little bit different than the buckets we had. Can you just give us any qualitative color on relative areas of strength in the quarter? I understand that resolve volumes in particular has been beating us for a while, so just curious to get anything to call out there.

Mark Massaro: Vivian, so we could really move from unit revenue by test for, which we've discussed, probably more for competitive market reasons, but we feel like this is a, you know, really good way to provide better visibility to our menu bills and it's driven by a couple things. One is when you look at the pricing of the tissue-based versus the liquid based test, it's materially different, right? So we think that gives you better visibility as far as our unit growth rate.

Mark Massaro: Again, I would point to the comp of Q2 over Q2 last year. So we think these growth rates and acceleration revenue are very, very sustainable across our menu. So from a correspondingly, our ASPs are significantly higher than select and resolve. So we are seeing continued growth across our menu for the most part in resolve. And we have a lot of room in each of those markets. So what confidence that this gives better visibility for comparison purposes as we go forward in better detail on how the menu, as we've extended it, which I think is somewhat uncommon, contributes and builds up to our reported revenue and just as importantly are viewed forward from a guidance perspective.

Ron Kalfus: Thank you. Okay, perfect. Understood. Thanks for the color. And just to follow up, this one is a little bit nitpicky. That, you know, it was a bigger quarter ready-wise, but it didn't seem to drop down the gross margins as well as it has historically. I think that would just be driven by the test mix, but just any other variables to call out on the gross margins. No other variables, strictly the timing mix and its mix of not only is there met again, is there menus expanded?

Ron Kalfus: The mix becomes more, you know, more relevant as far as the quarter by quarter gross margin, but also the pair mix that comes across. So it's a permutation of expanded venue and pair mix by quarter, but no material change. Thank you. Great. Thanks for taking the question.

Operator: Thank you.

Thomas Brackmann: Our next question is from Thomas Brackmann with KBC Securities. Please proceed with your question. I think you're taking my question and congrats on the nice growth rates again.

Michael McGarrity: Maybe two questions from my side. The first one is whether you could give a bit more insight in exactly where you stand with the integration of that germline testing. What are the steps that are needed or that still need to be taken to reach out that revenue contribution as of H2? Secondly, I also wanted to pick back up on a comment that you made a couple of months ago with regards to potentially other looking at additional opportunities to expand the testing menu.

Michael McGarrity: Given the fact that the test has been added to what is now your current outlook into let's say the rest of the year and maybe next year with regards to evaluating additional opportunities. Thank you. Next time, yes.

Michael McGarrity: First, the germline we communicated, which is the way we take these new opportunities, where we engage in a limited launch. And that's really too cold. Want to confirm our diligence and to get some experience with our sales organization and limited launch. To be able to be able to roll out. So we're in that phase. Now in Q3, we have received samples. We also like to get it as you know, Thomas, about a quarter of history of air mix coverage and historical gets a history of payments.

Michael McGarrity: Even with Medicare, we did the same thing with Slack last year. So we again feel like we'll begin to report revenue contribution in the second half of this year and probably then be able to give you a better visibility as to how it contributes to our overall view forward. But we like to fit for for sure, with our menu offering. And again, I would point to the fact that that concept, not unlike resolve came goes from our customers, right?

Michael McGarrity: All the good ideas come from the people in the field, whether it be our reps or customers. And that's a good example. That as far as the second part of your question, our growth opportunities. You know, I'm careful there, but we have them, right? So I'll provide the detail, right? I think I've commented before and we want to go a strategy process here. We have over the last two years, and we were always looking out as to what's out there that we think is interesting.

Michael McGarrity: It's also can't really an unintended consequence exercise to make sure we don't miss something, both from our current menu, offering competitively and where the direction of the market goes, but for the new opportunities. And I think the strength of our channel and our customer base and our access and influence has flipped that from us always looking out on to inbound. But we're very careful and focused in our diligence process for these opportunities, but if you may be assumption, I'm communicated that we have a dashboard of opportunities that we evaluate. But we have an even more rigorous process to before we take anything to market or engage in and sort of partnership for distribution or strategic partnership.

Michael McGarrity: I'll make one more comment that I think you'd be okay with, but you know, you saw the recent addition to a board of Sandy Seagull. And, you know, I would say that already having someone like that on our side on our team and supporting our marketing group or relationships started with. Jeff Lano and Ken Conley and the credibility they build with our with our community leaders and having not only an accomplished practitioner and clinician, but somebody who clearly can see beyond where the market used to be where it is today and where it's headed.

Michael McGarrity: So we like our set up there. And if you may be assumption that our menu will look different. Two years from now, as it does very different two years prior, where we had one test generating rather than I think that's a reasonable assumption. Hopefully that answered your question times. Yes, very clear. Thank you very much. Thank you so much. Thanks. Thank you.

Jason Bednar: Our next question is from Jason Bednar with Piper Sandler. Please proceed with your question. Hey guys, are you okay? Yes Jason. Great. It's one of the two questions. I'll ask you both up front here and sorry for your background noise, but I just want to ask on pace of volume activity during the quarter. Just in how that informs your view of the second half of the year, I'm just doing very well here in the first half.

Jason Bednar: And you just want to want to see if there's any strengthening or weakening or things are pretty stable across the quarter. And just remind us of your code of where we're at with respect to getting back to normal testing volume across the industry.

Michael McGarrity: And then the second question, separate question. Now that we've fully consolidated the GPS operation, there are there are efficiency benefits that we can expect to see in the second half of the year. Thank you. Thanks Jason. Yeah, I'll comment on the second part first. So we've modeled the GPS obviously exact exact was writing the test for us. So there are some economic associated with that. We believe that it's it's based out of each other as we staffed our laboratory to go live with the GPS test.

Michael McGarrity: So we don't see any material favorable or unfavorable impact to the PNL, and as far as the view for the second half of the year, yeah, we view it as very sustainable. Q3 is always a little bit of a lot of current on the general cautious with how Q3 with even close to endemic more, I guess I would say seasonality with regard to patient flow staffing vacations, but I would not expect any material down term or change.

Michael McGarrity: And our trajectory from a growth perspective, probably even with absent any material change in Q3 from a seasonality perspective. So that's the message we're delivering. I think it's reflected in our guidance and our view that I made the comment that internally we believe that we can drive 20% or greater revenue growth in a very, very sustainable way. Thank you.

Operator: There are no further questions at this time.

Operator: This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.