Operator: Good day, and thank you for standing by. Welcome to the Adaptive Biotechnologies Fourth Quarter and Full Year Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Karina Calzadilla, Vice President, Investor Relations. Please go ahead.
Operator: Good day, and thank you for standing by. Welcome to the Adaptive Biotechnologies Fourth Quarter and Full Year Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Karina Calzadilla, Vice President, Investor Relations. Please go ahead.
Speaker #1: Good day, and thank you for standing by. Welcome to the Adaptive Biotechnologies fourth quarter and full-year earnings conference call. At this time, all participants are in a listen-only mode.
Speaker #1: After the speakers' presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star 1-1 on your telephone.
Speaker #1: You will then hear an automated message. Advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded.
Speaker #1: I would now like to hand the conference over to your speaker today, Karina Calzadilla, Vice President, Investor Relations. Please go ahead.
Speaker #2: Thank you, Daniel. And good afternoon, everyone. I would like to welcome you to Adaptive Biotechnologies' fourth quarter and full year 2025 earnings conference call.
Karina Calzadilla: Thank you, Daniel, and good afternoon, everyone. I would like to welcome you to Adaptive Biotechnologies' Fourth Quarter and Full Year 2025 Earnings Conference Call. Earlier today, we issued a press release reporting Adaptive financial results for the fourth quarter and full year of 2025. The press release is available at www.adaptivebiotech.com. We are conducting a live webcast of this call and will be referencing to a slide presentation that has been posted to the investor section in our corporate website. During the call, management will make projections and other forward-looking statements within the meanings of federal security laws regarding future events and the future financial performance of the company. These statements reflect management's current perspective of the business as of today.
Karina Calzadilla: Thank you, Daniel, and good afternoon, everyone. I would like to welcome you to Adaptive Biotechnologies' Fourth Quarter and Full Year 2025 Earnings Conference Call. Earlier today, we issued a press release reporting Adaptive financial results for the fourth quarter and full year of 2025. The press release is available at www.adaptivebiotech.com. We are conducting a live webcast of this call and will be referencing to a slide presentation that has been posted to the investor section in our corporate website. During the call, management will make projections and other forward-looking statements within the meanings of federal security laws regarding future events and the future financial performance of the company. These statements reflect management's current perspective of the business as of today.
Speaker #2: Earlier today, we issued a press release reporting Adaptive financial results for the fourth quarter and full year of '25. The press release is available at www.adaptivebiotech.com.
Speaker #2: We are conducting a live webcast of this call and will be referencing a slide presentation that has been posted to the investor section of our corporate website.
Speaker #2: During the call, management will make projections and other forward-looking statements within the meaning of federal securities laws regarding future events and the future financial performance of the company.
Speaker #2: These statements reflect management's current perspective of the business as of today. Actual results may differ materially from today's forward-looking statements, depending on a number of factors, which are set forth in our public filings with the SEC and listed in this presentation.
Karina Calzadilla: Actual results may differ materially from today's forward-looking statements, depending on a number of factors, which are set forth in our public filings with the SEC and listed in this presentation. In addition, non-GAAP financial measures will be discussed during the call, and a reconciliation from non-GAAP to GAAP metrics can be found in our earnings release. Joining the call today are Chad Robins, our CEO and Co-Founder, and Kyle Piskel, our Chief Financial Officer. Additional members from management will be available for Q&A. With that, I'll turn the call over to Chad. Chad?
Karina Calzadilla: Actual results may differ materially from today's forward-looking statements, depending on a number of factors, which are set forth in our public filings with the SEC and listed in this presentation. In addition, non-GAAP financial measures will be discussed during the call, and a reconciliation from non-GAAP to GAAP metrics can be found in our earnings release. Joining the call today are Chad Robins, our CEO and Co-Founder, and Kyle Piskel, our Chief Financial Officer. Additional members from management will be available for Q&A. With that, I'll turn the call over to Chad. Chad?
Speaker #2: In addition, non-GAAP financial measures will be discussed during the call, and a reconciliation from non-GAAP to GAAP metrics can be found in our earnings release.
Speaker #2: Joining the call today are Chad Robins, our CEO and co-founder, and Kyle Piskel, our Chief Financial Officer. Additional members from management will be available for Q&A.
Speaker #2: With that, I'll turn the call over to Chad.
Speaker #3: Thanks, Karina. Good afternoon, and thank you for joining us on our fourth quarter and full-year earnings call. 2025 was a remarkable year for Adaptive.
Chad Robins: Thanks, Karina. Good afternoon, and thank you for joining us on our Q4 and full year earnings call. 2025 was a remarkable year for Adaptive, marked by strong execution and meaningful progress across the business. As shown on slide 3, in the MRD business, full year revenue grew 46% year-over-year, and we achieved profitability ahead of expectations. We also delivered several key catalysts in the year that position the business for sustained growth and continued margin expansion. These include accelerated EMR integrations, including the integration of clonoSEQ into Flatiron Health's OncoEMR, expanding access across the community setting. The launch of NovaSeq X Plus to help scale operations and improve margins. Our first Medicare coverage for recurrence monitoring in MCL, expanding the lifetime value of each MCL Medicare patient. Updates in NCCI guidelines across all reimbursed indications, which continues to deepen clinical validation.
Chad Robins: Thanks, Karina. Good afternoon, and thank you for joining us on our Q4 and full year earnings call. 2025 was a remarkable year for Adaptive, marked by strong execution and meaningful progress across the business. As shown on slide 3, in the MRD business, full year revenue grew 46% year-over-year, and we achieved profitability ahead of expectations. We also delivered several key catalysts in the year that position the business for sustained growth and continued margin expansion. These include accelerated EMR integrations, including the integration of clonoSEQ into Flatiron Health's OncoEMR, expanding access across the community setting. The launch of NovaSeq X Plus to help scale operations and improve margins. Our first Medicare coverage for recurrence monitoring in MCL, expanding the lifetime value of each MCL Medicare patient. Updates in NCCI guidelines across all reimbursed indications, which continues to deepen clinical validation.
Speaker #3: Marked by strong execution, and meaningful progress across the business. As shown on slide three, in the MRD business, full year revenue grew 46% year over year, and we achieved profitability ahead of expectations.
Speaker #3: We also delivered several key catalysts in the year that positioned the business for sustained growth and continued margin expansion. These include accelerated EMR integrations, including the integration of clonoSEQ into Flatiron's OncoEMR, expanding access across the community setting.
Speaker #3: The launch of NovaSeq X+ to help scale operations and improve margins. Our first Medicare coverage for recurrence monitoring in MCL, expanding the lifetime value of each MCL Medicare patient.
Speaker #3: Updates in NCCI guidelines across all reimbursed indications. Which continues to deepen clinical validation. And strong data generations, which was marked by an all-time high, with over 90 abstracts presented at ASH, reinforcing MRD's growing role as an interventional tool in patient care.
Chad Robins: Strong data generation, which was marked by an all-time high with over 90 abstracts presented at ASH, reinforcing MRD's growing role as an interventional tool in patient care. In the Immune Medicine business, we scaled our TCR antigen data and modeling capabilities, leading to our first two data partnerships, and we completed a preclinical data package for our lead TCR depleting antibody program in Ankylosing Spondylitis. Taken together, the strong MRD execution, the continued progress in Immune Medicine, and the disciplined spending across the organization drove 55% total company revenue growth and a 68% reduction in cash burn, leading to a strong cash balance of $227 million at year-end. Let's turn to slide 5 for a closer look at the MRD performance and future expectations, starting with clinical testing.
Chad Robins: Strong data generation, which was marked by an all-time high with over 90 abstracts presented at ASH, reinforcing MRD's growing role as an interventional tool in patient care. In the Immune Medicine business, we scaled our TCR antigen data and modeling capabilities, leading to our first two data partnerships, and we completed a preclinical data package for our lead TCR depleting antibody program in Ankylosing Spondylitis. Taken together, the strong MRD execution, the continued progress in Immune Medicine, and the disciplined spending across the organization drove 55% total company revenue growth and a 68% reduction in cash burn, leading to a strong cash balance of $227 million at year-end. Let's turn to slide 5 for a closer look at the MRD performance and future expectations, starting with clinical testing.
Speaker #3: In the immune medicine business, we scaled our DCR antigen data and modeling capabilities, leading to our first two data partnerships. And we completed a preclinical data package for our lead TCR depleting antibody program and ankylosing spondylitis.
Speaker #3: Taken together, the strong MRD execution, the continued progress in immune medicine, and the disciplined spending across the organization drove 55% total company revenue growth and a 68% reduction in cash burn, leading to a strong cash balance of $227 million at year end.
Speaker #3: Let's turn to slide five for a closer look at the MRD performance and future expectations. Starting with clinical testing. ClonoSeq clinical testing revenue grew 64% for full year 2025 and 59% in the fourth quarter compared to the prior year.
Chad Robins: clonoSEQ clinical testing revenue grew 64% for full year 2025 and 59% in the fourth quarter compared to the prior year. As shown in the chart, volumes increased sequentially throughout the year, reaching a new record of 30,038 tests in the fourth quarter, up 43% year-over-year and 11% sequentially. Growth was broad-based across all reimbursed indications, with DLBCL, MCL, and multiple myeloma driving the majority of year-over-year growth. Multiple myeloma represented 44% of US clonoSEQ volume, followed by ALL at 30%, CLL and DLBCL both at 9%, and MCL at 5%. Volume growth throughout the year was driven by a combination of interrelated factors, including blood-based testing, community presence, EMR integrations, clinical guideline inclusion, and ongoing data generation.
Chad Robins: clonoSEQ clinical testing revenue grew 64% for full year 2025 and 59% in the fourth quarter compared to the prior year. As shown in the chart, volumes increased sequentially throughout the year, reaching a new record of 30,038 tests in the fourth quarter, up 43% year-over-year and 11% sequentially. Growth was broad-based across all reimbursed indications, with DLBCL, MCL, and multiple myeloma driving the majority of year-over-year growth. Multiple myeloma represented 44% of US clonoSEQ volume, followed by ALL at 30%, CLL and DLBCL both at 9%, and MCL at 5%. Volume growth throughout the year was driven by a combination of interrelated factors, including blood-based testing, community presence, EMR integrations, clinical guideline inclusion, and ongoing data generation.
Speaker #3: As shown in the chart, volumes increased sequentially throughout the year, reaching a new record of 30,038 tests in the fourth quarter, up 43% year over year and 11% sequentially.
Speaker #3: Growth was broad-based across all reimbursed indications, with DLBCL, MCL, and multi-myeloma driving the majority of year-over-year growth. Multi-myeloma represented 44% of US ClonoSeq volume, followed by ALL at 30%, CLL and DLBCL both at 9%, and MCL at 5%.
Speaker #3: Volume growth throughout the year was driven by a combination of interrelated factors, including blood-based testing, community presence, EMR integrations, clinical guideline inclusion, and ongoing data generation.
Speaker #3: In the fourth quarter, blood-based testing accounted for 47% of ClonoSeq tests, up from 41% a year ago. In multiple myeloma, blood-based testing reached 27%, which is a six-point increase year over year.
Chad Robins: In Q4, blood-based testing accounted for 47% of clonoSEQ tests, up from 41% a year ago. In multiple myeloma, blood-based testing reached 27%, which is a 6-point increase year-over-year, which is particularly meaningful given the bone marrow-based nature of the disease. Community testing also continued to expand, with volumes up 18% sequentially and representing approximately 33% of total tests in the quarter. We further scaled our digital footprint, completing Epic integrations in 8 accounts during the quarter, bringing the total to 173 integrated accounts, which now drive approximately 40% of ordering volume. Finally, NCCN guideline updates and continued data readouts across marketed indications supported our commercial execution. Ordering HCPs increased 9% sequentially and 45% year-over-year in Q4, with particularly strong adoption in the community setting.
Chad Robins: In Q4, blood-based testing accounted for 47% of clonoSEQ tests, up from 41% a year ago. In multiple myeloma, blood-based testing reached 27%, which is a 6-point increase year-over-year, which is particularly meaningful given the bone marrow-based nature of the disease. Community testing also continued to expand, with volumes up 18% sequentially and representing approximately 33% of total tests in the quarter. We further scaled our digital footprint, completing Epic integrations in 8 accounts during the quarter, bringing the total to 173 integrated accounts, which now drive approximately 40% of ordering volume. Finally, NCCN guideline updates and continued data readouts across marketed indications supported our commercial execution. Ordering HCPs increased 9% sequentially and 45% year-over-year in Q4, with particularly strong adoption in the community setting.
Speaker #3: Which is particularly meaningful given the bone marrow-based nature of the disease. Community testing also continued to expand, with volumes of 18% sequentially and representing approximately 33% of total tests in the quarter.
Speaker #3: We further scaled our digital footprint, completing EPIC integrations in eight accounts during the quarter, bringing the total to 173 integrated accounts, which now drop approximately 40% of ordering volume.
Speaker #3: Finally, NCCN guideline updates and continued data readouts across marketed indications supported our commercial execution. Ordering HCPs increased 9% sequentially and 45% year over year.
Speaker #3: In Q4, we particularly strong adoption in the community setting. Taken together, these drivers continue to increase both physician adoption and testing frequency per patient across indications.
Chad Robins: Taken together, these drivers continued to increase both physician adoption and testing frequency per patient across indications. Turning to slide six. In addition to volume, clinical revenue group growth was also driven by continued ASP expansion. We ended the year with an average ASP in the US of $1,307 per test, up 17% year-over-year, and we exited Q4 at about $1,350 per test. ASP growth during the year was driven by strong execution from our reimbursement team across several initiatives. These include the successful renegotiation of 8 major payer contracts with national and regional payers, including Humana, Aetna, Horizon, and multiple Blue Cross plans, as well as the signing of new agreements with Anthem, Centene, Florida, and L.A. Care. We also expanded commercial coverage policies with new coverage wins in DLBCL and in CLL.
Chad Robins: Taken together, these drivers continued to increase both physician adoption and testing frequency per patient across indications. Turning to slide six. In addition to volume, clinical revenue group growth was also driven by continued ASP expansion. We ended the year with an average ASP in the US of $1,307 per test, up 17% year-over-year, and we exited Q4 at about $1,350 per test. ASP growth during the year was driven by strong execution from our reimbursement team across several initiatives. These include the successful renegotiation of 8 major payer contracts with national and regional payers, including Humana, Aetna, Horizon, and multiple Blue Cross plans, as well as the signing of new agreements with Anthem, Centene, Florida, and L.A. Care. We also expanded commercial coverage policies with new coverage wins in DLBCL and in CLL.
Speaker #3: Turning to slide six, in addition to volume, clinical revenue growth was also driven by continued ASP expansion. We ended the year with an average ASP in the US of $1,307 per test.
Speaker #3: Up 17% year over year and we exited the fourth quarter at about $1,350 per test. ASP growth during the year was driven by strong execution from our reimbursement team across several initiatives.
Speaker #3: These include the successful renegotiation of eight major payer contracts with national and regional payers, including Humana Etna Horizon and multiple Blue Cross plans, as well as the signing of new agreements with Anthem, Centene Florida, and LA Care.
Speaker #3: We also expanded commercial coverage policies with new coverage wins in DLBCL and in CLL. In parallel, we delivered meaningful revenue cycle management improvements, including Medicaid collections, appeals, prior authorization processes, and time to cash.
Chad Robins: In parallel, we delivered meaningful revenue cycle management improvements, including Medicaid collections, appeals, prior authorization processes, and time to cash. These operational enhancements, supported by AI-enabled workflows, are driving higher paid claim rates, more consistent realization, and improved commercial payer cash collections year-over-year by 74%. Looking ahead, we expect these initiatives, together with two additional large national payer contracts we anticipate closing this year, to support our targeted average ASP of approximately $1,400 per test in 2026. Turning to slide seven. Our MRD pharma business had a strong year, with revenue growth of 20% year-over-year, including $19.5 million in regulatory milestone revenue. Excluding milestones, pharma grew 11%, and we ended the year with approximately $210 million in backlog. Several important shifts in our pharma portfolio are worth highlighting.
Chad Robins: In parallel, we delivered meaningful revenue cycle management improvements, including Medicaid collections, appeals, prior authorization processes, and time to cash. These operational enhancements, supported by AI-enabled workflows, are driving higher paid claim rates, more consistent realization, and improved commercial payer cash collections year-over-year by 74%. Looking ahead, we expect these initiatives, together with two additional large national payer contracts we anticipate closing this year, to support our targeted average ASP of approximately $1,400 per test in 2026. Turning to slide seven. Our MRD pharma business had a strong year, with revenue growth of 20% year-over-year, including $19.5 million in regulatory milestone revenue. Excluding milestones, pharma grew 11%, and we ended the year with approximately $210 million in backlog. Several important shifts in our pharma portfolio are worth highlighting.
Speaker #3: These operational enhancements supported by AI-enabled workflows are driving higher paid claim rates, more consistent realization, and improved commercial payer cash collections year over year by 74%.
Speaker #3: Looking ahead, we expect these initiatives together with two additional large national payer contracts we anticipate closing this year to support our targeted average ASP of approximately $1,400 per test in 2026.
Speaker #3: Turning to slide seven, our MRD pharma business had a strong year, with revenue growth of 20% year over year, including $19.5 million in regulatory milestone revenue. Excluding milestones, pharma grew 11%, and we ended the year with approximately $210 million in backlog.
Speaker #3: Several important shifts in our pharma portfolio are worth highlighting. First, multiple myeloma remains the largest driver, accounting for roughly 70% of sequencing revenue and approximately 60% of backlog.
Chad Robins: First, multiple myeloma remains the largest driver, accounting for roughly 70% of sequencing revenue and approximately 60% of backlog. Second, CLL and ALL bookings more than tripled in 2025, supported by emerging data underscoring the need for higher sensitivity MRD to differentiate therapies in both disease states, as well as updated NCCN guidelines for fixed-duration regimens in CLL. Third, MRD is increasingly embedded directly into regulated interventional trials, with approximately 60% of our portfolio, including MRD, as an endpoint, up from about 40% in 2024. This shift has been driven by regulatory momentum, including the ODAC recommendation and, most recently, the subsequent FDA draft guidance supporting MRD as a primary endpoint in multiple myeloma accelerated approvals. Of note, registrational trials that incorporated MRD carry higher economic value and have a halo effect in the clinical business.
Chad Robins: First, multiple myeloma remains the largest driver, accounting for roughly 70% of sequencing revenue and approximately 60% of backlog. Second, CLL and ALL bookings more than tripled in 2025, supported by emerging data underscoring the need for higher sensitivity MRD to differentiate therapies in both disease states, as well as updated NCCN guidelines for fixed-duration regimens in CLL. Third, MRD is increasingly embedded directly into regulated interventional trials, with approximately 60% of our portfolio, including MRD, as an endpoint, up from about 40% in 2024. This shift has been driven by regulatory momentum, including the ODAC recommendation and, most recently, the subsequent FDA draft guidance supporting MRD as a primary endpoint in multiple myeloma accelerated approvals. Of note, registrational trials that incorporated MRD carry higher economic value and have a halo effect in the clinical business.
Speaker #3: Second, CLL and ALL bookings more than tripled in 2025, supported by emerging data underscoring the need for higher sensitivity MRD to differentiate therapies in both disease states, as well as updated NCCN guidelines for fixed-duration regimens in CLL.
Speaker #3: Third, MRD is increasingly embedded directly into regulated interventional trials, with approximately 60% of our portfolio including MRD as an endpoint, up from about 40% in 2024.
Speaker #3: This shift has been driven by regulatory momentum, including the ODAC recommendation and most recently the subsequent FDA draft guidance supporting MRD as a primary endpoint in multi-myeloma accelerated approvals.
Speaker #3: Of note, registrational trials that incorporated MRD carry higher economic value and have a halo effect in the clinical business. Overall, we're encouraged by the expanding role of MRD across hematologic oncology trials, and we believe broader endpoint adoption, increased testing time points, and the need for greater sensitivity will continue to drive MRD pharma revenue growth.
Chad Robins: Overall, we're encouraged by the expanding role of MRD across hematologic oncology trials, and we believe broader endpoint adoption, increased testing time points, and the need for greater sensitivity will continue to drive MRD pharma revenue growth. Turning to slide 8, our focus this year is clear: continuing driving top-line growth while expanding margins, building on the same durable growth drivers that powered performance in 2025. In 2026, we expect clonoSEQ test volumes to grow by more than 30% year-over-year, supported by a continued mix shift towards blood-based testing, which we expect to exceed 50% of total MRD volume. Deeper penetration in the community setting, where we expect more than 35% of testing to originate.
Chad Robins: Overall, we're encouraged by the expanding role of MRD across hematologic oncology trials, and we believe broader endpoint adoption, increased testing time points, and the need for greater sensitivity will continue to drive MRD pharma revenue growth. Turning to slide 8, our focus this year is clear: continuing driving top-line growth while expanding margins, building on the same durable growth drivers that powered performance in 2025. In 2026, we expect clonoSEQ test volumes to grow by more than 30% year-over-year, supported by a continued mix shift towards blood-based testing, which we expect to exceed 50% of total MRD volume. Deeper penetration in the community setting, where we expect more than 35% of testing to originate.
Speaker #3: Turning to slide eight, our focus this year is clear. Continuing driving top-line growth while expanding margins building on the same durable growth drivers that powered performance in 2025.
Speaker #3: In 2026, we expect ClonoSeq test volumes to grow by more than 30% year over year, supported by a continued mixed shift toward blood-based testing which we expect to exceed 50% of total MRD volume.
Speaker #3: Deeper penetration in the community setting where we expect more than 35% of testing to originate. Further scaling of our EMR integration effort, adding approximately 40 with a focus on high to mid-volume accounts.
Chad Robins: Further scaling of our EMR integration effort, adding approximately 40, with a focus on high to mid-volume accounts, and continued generation of clinically meaningful data across multiple indications to further expand interventional use and support the guideline evolution. From a pricing standpoint, we expect to increase ASP to an average of about $1,400 per test, based on the initiatives described earlier. In pharma, we plan to increase the number of registrational and primary endpoint studies across multiple myeloma, CLL, and DLBCL, leveraging growing regulatory and clinical endorsement of MRD. We also expect continued margin expansion, driven by higher volumes flowing through the NovaSeq X Plus and operating leverage across our production and our commercial infrastructure. We believe these priorities position MRD as a scalable, durable, and increasingly profitable growth engine for Adaptive in 2026 and beyond.
Chad Robins: Further scaling of our EMR integration effort, adding approximately 40, with a focus on high to mid-volume accounts, and continued generation of clinically meaningful data across multiple indications to further expand interventional use and support the guideline evolution. From a pricing standpoint, we expect to increase ASP to an average of about $1,400 per test, based on the initiatives described earlier. In pharma, we plan to increase the number of registrational and primary endpoint studies across multiple myeloma, CLL, and DLBCL, leveraging growing regulatory and clinical endorsement of MRD. We also expect continued margin expansion, driven by higher volumes flowing through the NovaSeq X Plus and operating leverage across our production and our commercial infrastructure. We believe these priorities position MRD as a scalable, durable, and increasingly profitable growth engine for Adaptive in 2026 and beyond.
Speaker #3: And continued generation of clinically meaningful data across multiple indications to further expand interventional use and support the guideline evolution. From a pricing standpoint, we expect to increase ASP to an average of about $1,400 per test based on the initiatives described earlier.
Speaker #3: In pharma, we plan to increase the number of registrational and primary endpoint studies across multi-myeloma, CLL, and DLBCL, leveraging growing regulatory and clinical endorsement of MRD.
Speaker #3: We also expect continued margin expansion driven by higher volumes flowing through the NovaSeq X Plus and operating leverage across our production and our commercial infrastructure.
Speaker #3: We believe these priorities position MRD as a scalable, durable, and increasingly profitable growth engine for Adaptive in 2026 and beyond. Now, let's turn to slide 10 to discuss immune medicine.
Chad Robins: Now, let's turn to Slide 10 to discuss immune medicine. The premise of our immune medicine business is to generate large-scale, proprietary immune receptor data that allows us to understand how T cell receptors bind to antigens, and how those interactions drive immune responses across cancer, autoimmunity, and infectious diseases. Over the past year, we have continued to scale this data. We now have more than 5 million paired TCRs, spanning over 20,000 antigens and nearly 50 HLA types, a data set that is orders of magnitude larger than what is publicly available. We believe this scale is sufficient to train predictive models of the adaptive immune response across diseases. In parallel, we are applying our platform to identify what we believe are likely disease-causing T cell receptors and their antigens in certain autoimmune conditions, including Type 1 Diabetes, Celiac Disease, and Multiple Sclerosis.
Chad Robins: Now, let's turn to Slide 10 to discuss immune medicine. The premise of our immune medicine business is to generate large-scale, proprietary immune receptor data that allows us to understand how T cell receptors bind to antigens, and how those interactions drive immune responses across cancer, autoimmunity, and infectious diseases. Over the past year, we have continued to scale this data. We now have more than 5 million paired TCRs, spanning over 20,000 antigens and nearly 50 HLA types, a data set that is orders of magnitude larger than what is publicly available. We believe this scale is sufficient to train predictive models of the adaptive immune response across diseases. In parallel, we are applying our platform to identify what we believe are likely disease-causing T cell receptors and their antigens in certain autoimmune conditions, including Type 1 Diabetes, Celiac Disease, and Multiple Sclerosis.
Speaker #3: The premise of our immune medicine business is to generate large-scale, proprietary immune receptor data that allows us to understand how T cell receptors bind to antigens.
Speaker #3: And how those interactions drive immune responses across cancer, autoimmunity, and infectious diseases. Over the past year, we have continued to scale this data. We now have more than 5 million paired TCRs spanning over 20,000 antigens and nearly 50 HLA types.
Speaker #3: A dataset that is orders of magnitude larger than what is publicly available. We believe this scale is sufficient to train predictive models of the adaptive immune response across diseases.
Speaker #3: In parallel, we are applying our platform to identify what we believe are likely disease-causing T cell receptors and their antigens in certain autoimmune conditions, including type 1 diabetes, celiac disease, and multiple sclerosis.
Speaker #3: These insights have the potential for TCR-based target discovery to enable existing and future partners to develop immune-based therapeutics. Turning to slide 11, I'll briefly review our 2025 achievements and how they set us up for our 2026 strategy.
Chad Robins: These insights have the potential for TCR-based target discovery to enable existing and future partners to develop immune-based therapeutics. Turning to Slide 11, I'll briefly review our 2025 achievements and how they set us up for our 2026 strategy. First, we began to monetize our data with 2 distinct licensing deals with Pfizer. One is a data licensing agreement, in which Pfizer has access to a subset of our TCR antigen training data. Pfizer will use this data to develop and train its AI and machine learning models to accelerate research and drug discovery in multiple disease areas. The second licensing deal focuses on target discovery and rheumatoid arthritis, or RA. Here, we are applying our IM platform and capabilities to identify the specific autoreactive T cell receptors that are highly enriched only in RA patients.
Chad Robins: These insights have the potential for TCR-based target discovery to enable existing and future partners to develop immune-based therapeutics. Turning to Slide 11, I'll briefly review our 2025 achievements and how they set us up for our 2026 strategy. First, we began to monetize our data with 2 distinct licensing deals with Pfizer. One is a data licensing agreement, in which Pfizer has access to a subset of our TCR antigen training data. Pfizer will use this data to develop and train its AI and machine learning models to accelerate research and drug discovery in multiple disease areas. The second licensing deal focuses on target discovery and rheumatoid arthritis, or RA. Here, we are applying our IM platform and capabilities to identify the specific autoreactive T cell receptors that are highly enriched only in RA patients.
Speaker #3: First, we began to monetize our data with two distinct licensing deals with Pfizer. One, is a data licensing agreement in which Pfizer has access to a subset of our TCR antigen training data.
Speaker #3: Pfizer will use this data to develop and train its AI and machine learning models to accelerate research and drug discovery in multiple disease areas.
Speaker #3: The second licensing deal focuses on target discovery in rheumatoid arthritis, or RA. Here, we are applying our IM platform and capabilities to identify the specific autoreactive T cell receptors that are highly enriched only in RA patients.
Speaker #3: Pfizer will then use these data to accelerate its research and development of potential RA therapeutic candidates. Together, these partnerships continue to validate the strength of our differentiated platform and the value of our large-scale proprietary data.
Chad Robins: Pfizer will then use these data to accelerate its research and development of potential RA therapeutic candidates. Together, these partnerships continue to validate the strength of our differentiated platform and the value of our large-scale proprietary data. In addition, we completed a preclinical data package for our lead antibody program in Ankylosing Spondylitis. While potential next steps include initiating IND-enabling studies, we made the strategic decision to stop further investment in this program and instead prioritize capital toward data generation and AI modeling. These are key areas we believe leverage our core differentiation and represent the highest return on investment for immune medicine. Along with these key achievements, we also maintained a disciplined capital allocation, executing against our objectives while keeping annual immune medicine cash burn to around $30 million, as promised.
Chad Robins: Pfizer will then use these data to accelerate its research and development of potential RA therapeutic candidates. Together, these partnerships continue to validate the strength of our differentiated platform and the value of our large-scale proprietary data. In addition, we completed a preclinical data package for our lead antibody program in Ankylosing Spondylitis. While potential next steps include initiating IND-enabling studies, we made the strategic decision to stop further investment in this program and instead prioritize capital toward data generation and AI modeling. These are key areas we believe leverage our core differentiation and represent the highest return on investment for immune medicine. Along with these key achievements, we also maintained a disciplined capital allocation, executing against our objectives while keeping annual immune medicine cash burn to around $30 million, as promised.
Speaker #3: In addition, we completed a preclinical data package for our lead antibody program in ankylosing initiating IND-enabling spondylitis. While potential next steps include studies, we made the strategic decision to stop further investment in this program and instead prioritize capital toward data generation and AI modeling.
Speaker #3: These are key areas we believe leverage our core differentiation and represent the highest return on investment for immune medicine. Along with these key achievements, we also maintained a disciplined capital allocation, executing against our objectives while keeping annual immune medicine cash burn to around $30 million.
Speaker #3: As promised, looking ahead to 2026, we plan to continue advancing on our TCR antigen datasets and our AI/ML modeling work with a lower target net cash burn of 15 to 20 million dollars.
Chad Robins: Looking ahead to 2026, we plan to continue advancing on our TCR antigen datasets and our AI ML modeling work with a lower target net cash burn of $15 to 20 million. We continue to focus on securing additional data partnerships, which we believe have the potential to drive meaningful long-term upside for Adaptive. Now, I'm going to pass it over to Kyle, who's going to walk through the financial results and our 2026 full year guidance. Kyle?
Chad Robins: Looking ahead to 2026, we plan to continue advancing on our TCR antigen datasets and our AI ML modeling work with a lower target net cash burn of $15 to 20 million. We continue to focus on securing additional data partnerships, which we believe have the potential to drive meaningful long-term upside for Adaptive. Now, I'm going to pass it over to Kyle, who's going to walk through the financial results and our 2026 full year guidance. Kyle?
Speaker #3: We continue to focus on securing additional data partnerships which we believe have the potential to drive meaningful long-term upside for adaptive. Now, I'm going to pass it over to Kyle, who's going to walk through the financial results and our 2026 full-year guidance.
Speaker #3: Kyle?
Speaker #2: Thanks, Chad.
Kyle Piskel: Thanks, Chad. Turning to our financials. First, I'll cover our reported results, which include the non-cash revenue recognized from the amortization of amounts previously received under our Genentech collaboration. As you know, following the termination of the collaboration in August, all remaining amortization was accelerated and recognized in the third quarter. As a result, there are no ongoing Genentech collaboration economics in our results after Q3. Total company revenue for the fourth quarter was $71.7 million, and for the full year was $277 million, representing 51% and 55% year-over-year growth, respectively. Total company Adjusted EBITDA was $4.1 million in the fourth quarter, compared to a loss of $16.4 million a year ago. For the full year, Adjusted EBITDA was $12.2 million, compared to a loss of $80.4 million in 2024.
Kyle Piskel: Thanks, Chad. Turning to our financials. First, I'll cover our reported results, which include the non-cash revenue recognized from the amortization of amounts previously received under our Genentech collaboration. As you know, following the termination of the collaboration in August, all remaining amortization was accelerated and recognized in the third quarter. As a result, there are no ongoing Genentech collaboration economics in our results after Q3. Total company revenue for the fourth quarter was $71.7 million, and for the full year was $277 million, representing 51% and 55% year-over-year growth, respectively. Total company Adjusted EBITDA was $4.1 million in the fourth quarter, compared to a loss of $16.4 million a year ago. For the full year, Adjusted EBITDA was $12.2 million, compared to a loss of $80.4 million in 2024.
Speaker #2: Turning to our financials, first, I'll cover our reported results, which include the non-cash revenue recognized from the amortization of amounts previously received under our Genentech collaboration.
Speaker #2: As you know, following the termination of the collaboration in August, all remaining amortization was accelerated and recognized in the third quarter. As a result, there are no ongoing Genentech collaboration economics in our results after Q3.
Speaker #2: Total company revenue for the fourth quarter was $71.7 million, and for the full year was $277 million, representing 51% and 55% year-over-year growth, respectively.
Speaker #2: Total company adjusted EBITDA was $4.1 million in the fourth quarter, compared to a loss of $16.4 million a year ago. For the full year, adjusted EBITDA was $12.2 million, compared to a loss of $80.4 million in 2024.
Speaker #2: Interest expense from our royalty financing agreement with Orbimed was $3 million in Q4 and $11.8 million for the full year, while interest income was $2.1 million and $9.4 million for the same respective period.
Kyle Piskel: Interest expense from our royalty financing agreement with OrbiMed was $3 million in Q4 and $11.8 million for the full year, while interest income was $2.1 million and $9.4 million for the same respective period. Net loss was $13.6 million for the quarter and $59.5 million for the full year. Now, turning to slide 12, the revenue and Adjusted EBITDA figures I'll discuss from here on forward are presented excluding all non-cash revenue from Genentech amortization in all periods shown. On this basis, fourth quarter revenue was $71.7 million, which increased 63% year-over-year, with 86% contribution from MRD and 14% from Immune Medicine. MRD revenue was $61.9 million, up 54% year-over-year, with clinical and pharma contributions of 67% and 33%, respectively.
Kyle Piskel: Interest expense from our royalty financing agreement with OrbiMed was $3 million in Q4 and $11.8 million for the full year, while interest income was $2.1 million and $9.4 million for the same respective period. Net loss was $13.6 million for the quarter and $59.5 million for the full year. Now, turning to slide 12, the revenue and Adjusted EBITDA figures I'll discuss from here on forward are presented excluding all non-cash revenue from Genentech amortization in all periods shown. On this basis, fourth quarter revenue was $71.7 million, which increased 63% year-over-year, with 86% contribution from MRD and 14% from Immune Medicine. MRD revenue was $61.9 million, up 54% year-over-year, with clinical and pharma contributions of 67% and 33%, respectively.
Speaker #2: Net loss was $13.6 million for the quarter and $59.5 million for the full year. Now, turning to slide 12, the revenue and adjusted EBITDA figures I'll discuss from here on forward are presented excluding all non-cash revenue from Genentech amortization in all periods shown.
Speaker #2: On this basis, fourth quarter revenue was $71.7 million, which increased 63% year-over-year with 86% contribution from MRD and 14% from immune medicine. MRD revenue was $61.9 million, up 54% year-over-year with clinical and pharma contributions of $67% and $33%, volume increased 43% to respectively.
Speaker #2: clonoSEQ tests totaled 30,038, up from 20,945 in the prior year quarter. Immune Medicine revenue was $9.8 million, up from $3.8 million a year ago, driven primarily by our data licensing agreement with Pfizer.
Kyle Piskel: clonoSEQ test volume increased 43% to 30,038 tests, up from 20,945 in the prior year quarter. Immune medicine revenue was $9.8 million, up from $3.8 million a year ago, driven primarily by our data licensing agreement with Pfizer. For the full year, total revenue was $235.7 million, up 42% year-over-year. MRD revenue was $212 million, up 46%, including $19.5 million in milestone revenue. Excluding milestones, MRD revenue grew 45% versus 2024. Immune medicine revenue was $23.4 million, representing a 17% increase from the prior year.
Kyle Piskel: clonoSEQ test volume increased 43% to 30,038 tests, up from 20,945 in the prior year quarter. Immune medicine revenue was $9.8 million, up from $3.8 million a year ago, driven primarily by our data licensing agreement with Pfizer. For the full year, total revenue was $235.7 million, up 42% year-over-year. MRD revenue was $212 million, up 46%, including $19.5 million in milestone revenue. Excluding milestones, MRD revenue grew 45% versus 2024. Immune medicine revenue was $23.4 million, representing a 17% increase from the prior year.
Speaker #2: For the full year, total revenue was $235.7 million, up 42% year-over-year. MRD revenue was $21.2 million, up 46%, including $19.5 million in milestone revenue. Excluding milestones, MRD revenue was $21.2 million.
Speaker #2: MRD revenue grew 45% versus 2024. Immune medicine revenue was $23.4 million, representing a 17% increase from the prior year. Moving down the P&L, sequencing gross margin, which excludes MRD milestones, Genentech amortization, and the licensing revenue from Pfizer, was $71% in Q4, up 12 points year-over-year and 5 points sequentially.
Kyle Piskel: Moving down the P&L, sequencing gross margin, which excludes MRD milestones, Genentech amortization, and the licensing revenue from Pfizer, was 71% in Q4, up 12 points year-over-year and 5 points sequentially. Full year sequencing gross margin was 66%, up from 53% in 2024. Lower cost per sample were driven by production efficiencies, labor leverage, and the transition to NovaSeq X Plus. Total operating expenses, including cost of revenue, were $84.5 million in Q4, up 4% year-over-year, primarily due to higher MRD sales and marketing investment, primarily from EMR and market access initiatives, partially offset by lower immune medicine R&D. Full year operating expenses were $334.1 million, down 2% year-over-year.
Kyle Piskel: Moving down the P&L, sequencing gross margin, which excludes MRD milestones, Genentech amortization, and the licensing revenue from Pfizer, was 71% in Q4, up 12 points year-over-year and 5 points sequentially. Full year sequencing gross margin was 66%, up from 53% in 2024. Lower cost per sample were driven by production efficiencies, labor leverage, and the transition to NovaSeq X Plus. Total operating expenses, including cost of revenue, were $84.5 million in Q4, up 4% year-over-year, primarily due to higher MRD sales and marketing investment, primarily from EMR and market access initiatives, partially offset by lower immune medicine R&D. Full year operating expenses were $334.1 million, down 2% year-over-year.
Speaker #2: Full-year sequencing gross margin was 66%, up from 53% in 2024. Lower cost per sample was driven by production efficiencies, labor leverage, and the transition to NovaSeq X Plus.
Speaker #2: Total operating expenses, including cost of revenue, were $84.5 million in Q4, up 4% year-over-year, primarily due to higher MRD sales and marketing investment, primarily from EMR and market access initiatives, partially offset by lower immune medicine R&D.
Speaker #2: Full-year operating expenses were $334.1 million, down 2% year-over-year. As shown in the segment tables, MRD adjusted EBITDA was positive $15.2 million in 2025, compared to a loss of $41.2 million in 2024, driven by higher
Kyle Piskel: As shown in the segment table, MRD Adjusted EBITDA was positive $15.2 million in 2025, compared to a loss of $41.2 million in 2024, driven by higher revenue. Immune Medicine Adjusted EBITDA loss improved to $31 million from $37.9 million, reflecting lower operating spend and increased revenue. As a result of strong top-line growth, improving efficiency, and disciplined spending, we ended the year with $227 million in cash, cash equivalents, and marketable securities. This amount excludes $13.1 million of cash held by Digital Biotechnologies. Now, turning to Slide 13 for our full-year 2026 guidance. We expect full-year revenue for the MRD business to be between $255 million and $265 million. This includes $8 to $9 million in MRD milestone revenue based on our current line of sight.
Kyle Piskel: As shown in the segment table, MRD Adjusted EBITDA was positive $15.2 million in 2025, compared to a loss of $41.2 million in 2024, driven by higher revenue. Immune Medicine Adjusted EBITDA loss improved to $31 million from $37.9 million, reflecting lower operating spend and increased revenue. As a result of strong top-line growth, improving efficiency, and disciplined spending, we ended the year with $227 million in cash, cash equivalents, and marketable securities. This amount excludes $13.1 million of cash held by Digital Biotechnologies. Now, turning to Slide 13 for our full-year 2026 guidance. We expect full-year revenue for the MRD business to be between $255 million and $265 million. This includes $8 to $9 million in MRD milestone revenue based on our current line of sight.
Speaker #1: revenue A immune medicine . Adjusted EBITDA loss improved to 31 million from reflecting lower 37.9 million , operating spend and increased as a result revenue strong top line growth and increased revenue as a result of strong top line growth , improving efficiency and disciplined spending , we ended the year 227 million in cash , cash with equivalents and marketable securities .
Speaker #1: This amount excludes 13.1 million of cash held by digital Biotechnologies . Now turning to slide 13 . For our full year 2026 guidance , we expect full year revenue for the MRD business to be between 255 and 265 million .
Speaker #1: This includes 8 to 9 million MRD milestone revenue based on our current line of sight . At the midpoint , this guidance implies 22% year over year growth , or 30% growth excluding milestones .
Kyle Piskel: At the midpoint, this guidance implies 22% year-over-year growth or 30% growth excluding milestones. We expect MRD revenue to be approximately 45% weighted to the first half of the year and 55% to the second half, as clinical volume and ASP growth compound with sequential clinical volume growth anticipated throughout the year. We expect full year operating expenses, including cost of revenue, to be between $350 and $360 million, representing 6% growth year-over-year at the midpoint. This reflects merit increases in additional targeted investments in MRD sales and marketing to support continued market expansion, while leveraging our existing commercial and operational infrastructure. In addition, we expect to achieve positive Adjusted EBITDA and positive free cash flow for the whole company by the end of 2026.
Kyle Piskel: At the midpoint, this guidance implies 22% year-over-year growth or 30% growth excluding milestones. We expect MRD revenue to be approximately 45% weighted to the first half of the year and 55% to the second half, as clinical volume and ASP growth compound with sequential clinical volume growth anticipated throughout the year. We expect full year operating expenses, including cost of revenue, to be between $350 and $360 million, representing 6% growth year-over-year at the midpoint. This reflects merit increases in additional targeted investments in MRD sales and marketing to support continued market expansion, while leveraging our existing commercial and operational infrastructure. In addition, we expect to achieve positive Adjusted EBITDA and positive free cash flow for the whole company by the end of 2026.
Speaker #1: We expect MRD revenue to be approximately 45% , weighted to first half of the year , the 55% to the second half . As volume and ASP growth compound with clinical volume sequential growth anticipated throughout the year , we full year expect expenses , operating including cost of revenue , to be between 350 and 360 million , representing 6% growth year over year .
Speaker #1: At the midpoint, this reflects merit increases and additional targeted investments in MRD sales and marketing to support continued market expansion, while leveraging our existing commercial and operational infrastructure.
Speaker #1: In addition, we expect to achieve positive adjusted EBITDA and positive free cash flow for the whole company by the end of 2026.
Kyle Piskel: Of note, as in prior years, Q1 will be our highest quarterly cash utilization, primarily due to annual corporate bonus payments. I am pleased and encouraged by the strong results we delivered in 2025 and look forward to providing financial updates throughout the year as we execute towards our goals. With that, I'll hand it back over to Chad.
Kyle Piskel: Of note, as in prior years, Q1 will be our highest quarterly cash utilization, primarily due to annual corporate bonus payments. I am pleased and encouraged by the strong results we delivered in 2025 and look forward to providing financial updates throughout the year as we execute towards our goals. With that, I'll hand it back over to Chad.
Speaker #1: note , as in Of prior years , Q1 will be our highest quarterly cash utilization , primarily due to annual corporate bonus payments .
Speaker #1: I am pleased and encouraged by the strong results we delivered in 2025, and look forward to providing financial updates throughout the year as we execute towards our goals.
Chad Robins: Thanks, Kyle. To bring it all together, 2025 was an outstanding year for Adaptive on all fronts. In MRD, we achieved profitability and grew the top line by 46%, driven by strong clonoSEQ volume growth. In IM, we scaled our TCR antigen data and began executing on targeted monetization opportunities that build long-term strategic value. And importantly, we maintained our strong cash position, giving us the flexibility to execute across both businesses. Looking ahead to 2026, we're focused on continuing to fuel MRD revenue growth, expand margins, and deliver company-wide profitability. We have a great playbook in place, and we're executing against it. We're encouraged by the momentum we are seeing and are confident in our ability to execute and deliver on these priorities. I'll now turn the call back over to the operator and open it up for Q&A.
Chad Robins: Thanks, Kyle. To bring it all together, 2025 was an outstanding year for Adaptive on all fronts. In MRD, we achieved profitability and grew the top line by 46%, driven by strong clonoSEQ volume growth. In IM, we scaled our TCR antigen data and began executing on targeted monetization opportunities that build long-term strategic value. And importantly, we maintained our strong cash position, giving us the flexibility to execute across both businesses. Looking ahead to 2026, we're focused on continuing to fuel MRD revenue growth, expand margins, and deliver company-wide profitability. We have a great playbook in place, and we're executing against it. We're encouraged by the momentum we are seeing and are confident in our ability to execute and deliver on these priorities. I'll now turn the call back over to the operator and open it up for Q&A.
Speaker #1: With that , I'll hand it back over to Chad . Thanks , Kyle . To bring it all together , 2025 was an .
Speaker #2: Outstanding adaptive on all year for fronts in MRD. We profitability and achieved grew the top line by 46%, driven by strong clonoSEQ volume growth.
Speaker #2: And Im . We scaled our TCR antigen data and began executing on targeted monetization opportunities that build long term strategic value and importantly , we strong cash position , maintained our giving us the flexibility to execute across the both businesses .
Speaker #2: Looking ahead to 2026 , we're focused on continuing to fuel MRD revenue growth , expand margins and deliver company wide profitability . We have a great playbook in place , and executing against we're it .
Speaker #2: We're encouraged by the momentum we are seeing and our confident in our ability to execute and deliver on these priorities . I'll now turn the call back over to the operator and open it up for Q&A .
Operator: Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from David Westenberg with Piper Sandler. Your line is open.
Operator: Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from David Westenberg with Piper Sandler. Your line is open.
Speaker #3: Thank you . As a reminder to ask a question , please press star one one on your telephone and wait for your name to be announced withdraw your .
Speaker #3: To question , please press star one . One again . Please stand by while we compile the Q&A roster . Our first question comes from David Wessenberg with Piper Sandler .
David Westenberg: Hey, thank you for taking the question, and congrats on a very strong volume quarter in Q4. So actually, I want to start with that, that sequential step up in clonoSEQ volume. Can you discuss how to think about that trend? Is there any seasonality there? And can you discuss some of the weather-related issues you might see in Q1? And one of the things I want to get at is, you have a higher base now, so growing that sequentially up on a percentage basis might be a little bit more difficult, obviously, you know, given how big your volumes are starting to get.
David Westenberg: Hey, thank you for taking the question, and congrats on a very strong volume quarter in Q4. So actually, I want to start with that, that sequential step up in clonoSEQ volume. Can you discuss how to think about that trend? Is there any seasonality there? And can you discuss some of the weather-related issues you might see in Q1? And one of the things I want to get at is, you have a higher base now, so growing that sequentially up on a percentage basis might be a little bit more difficult, obviously, you know, given how big your volumes are starting to get.
Speaker #3: Your open line is .
Speaker #4: Hey , thank you for taking the question . And congrats on a very strong volume quarter . In Q4 . So actually , I want to start with that .
Speaker #4: That sequential step up in volume . Can discuss how to you think about that trend ? Is there any seasonality there ? And can you discuss some of the weather related issues you might see in Q1 ?
Speaker #4: And one of the things I want to get at is higher base now . So growing that you have a sequentially up on a percentage basis might be a little bit more difficult .
Speaker #4: Obviously, you know, given how big your volumes are starting to get.
Kyle Piskel: Sure. Thanks for the question, David. You know, we were really pleased with the Q4 results, and certainly, I think it addressed any questions that folks had about whether there was deceleration in prior quarters. I think we like to see, you know, that Q4 number really as a testament to, I think, the long-term opportunity to grow this business at a strong rate. You know, I think that we see seasonality at various points in the year.
Kyle Piskel: Sure. Thanks for the question, David. You know, we were really pleased with the Q4 results, and certainly, I think it addressed any questions that folks had about whether there was deceleration in prior quarters. I think we like to see, you know, that Q4 number really as a testament to, I think, the long-term opportunity to grow this business at a strong rate. You know, I think that we see seasonality at various points in the year.
Speaker #5: Sure . Thanks for the question , David . You know , we were really pleased with the Q4 results . And certainly I think it addressed any questions that folks had about whether there was deceleration in think prior quarters .
Speaker #5: I like to see, you know, that Q4 number really as a testament to, I think, the long term—this opportunity to grow the business at a strong rate.
Speaker #5: We are , you know , I think that we see seasonality at various points in the year . Typically , Q1 has been a strong quarter for us , and Q1 has been lighter just given holidays , weather , etc.
Susan Bobulsky: ... typically, Q1 has been a strong quarter for us, and Q1 has been lighter, just given holidays, weather, et cetera. We have seen some weather-related impacts, as you are well aware, in recent weeks, primarily on timing of sample arrival, as opposed to volume, although some impacts, of course, on volume as well. FedEx was not delivering for some number of days, hospitals and practices closed down. But good news is, samples are starting to flow back in, in large volumes, and we had a very strong start to the beginning of Q1. So we remain confident in the guide for the year, remain confident in the forecast for the quarter, and that we'll show another strong sequential growth quarter over quarter in Q1.
Susan Bobulsky: ... typically, Q1 has been a strong quarter for us, and Q1 has been lighter, just given holidays, weather, et cetera. We have seen some weather-related impacts, as you are well aware, in recent weeks, primarily on timing of sample arrival, as opposed to volume, although some impacts, of course, on volume as well. FedEx was not delivering for some number of days, hospitals and practices closed down. But good news is, samples are starting to flow back in, in large volumes, and we had a very strong start to the beginning of Q1. So we remain confident in the guide for the year, remain confident in the forecast for the quarter, and that we'll show another strong sequential growth quarter over quarter in Q1.
Speaker #5: . We have seen some weather related impacts . As you are well aware , in recent weeks , primarily on timing of sample arrival as opposed to to although some impacts , of course , on volume as well .
Speaker #5: FedEx was not delivering for some number of days. Hospitals and practices closed down. But the good news is samples are starting back in to flow in large volumes.
Speaker #5: And we had a very strong start to the beginning of Q1. So we remain confident in the guide for the year, remain confident in the forecast for the quarter.
Speaker #5: And that we'll show another strong sequential growth quarter over quarter in Q1.
David Westenberg: Thank you so much. And, you know, I'll just ask one more, and I wanna kinda ask this a little bit more directly since, you know, I think you have a really good tech and a good position in blood. So how should we think about the penetration rates in DLBCL? You have a first major advantage in a lot of the blood cancers, particularly the multiple myeloma. How do you parlay that massive lead in multiple myeloma, for example, to DLBCL, where your penetration of late is a little bit lower? And, you know, there is some concerns about incoming competition.
David Westenberg: Thank you so much. And, you know, I'll just ask one more, and I wanna kinda ask this a little bit more directly since, you know, I think you have a really good tech and a good position in blood. So how should we think about the penetration rates in DLBCL? You have a first major advantage in a lot of the blood cancers, particularly the multiple myeloma. How do you parlay that massive lead in multiple myeloma, for example, to DLBCL, where your penetration of late is a little bit lower? And, you know, there is some concerns about incoming competition.
Speaker #4: Thank you so much . And you know , I'll just ask one more . And I want to kind of ask this a little bit more directly , since I think you have a really good tech and a good position in blood .
Speaker #4: So how should we think about the penetration rates in DSL? You have a first major advantage in a lot of blood cancers, particularly multiple myeloma.
Speaker #4: How do you parlay that massive lead in multiple myeloma, for example, to DBKL, where your penetration rate is a little bit lower and there are some concerns about incoming competition?
Susan Bobulsky: Sure. I mean, you know, I think we've learned a lot from the myeloma experience, and as you noted, have established a really strong position there. 45% or so of our business comes from that indication, and we've been able to post strong quarter-over-quarter growth repeatedly in that space, in part, thanks to the advancement of the assay in blood, in addition to bone marrow. In DLBCL, I think, you know, the playbook looks similar in a lot of ways, in the sense that, you know, we are starting with an underdeveloped market where people need to be convinced that MRD has a value. And that's been our major focus. We've seen strong results.
Susan Bobulsky: Sure. I mean, you know, I think we've learned a lot from the myeloma experience, and as you noted, have established a really strong position there. 45% or so of our business comes from that indication, and we've been able to post strong quarter-over-quarter growth repeatedly in that space, in part, thanks to the advancement of the assay in blood, in addition to bone marrow. In DLBCL, I think, you know, the playbook looks similar in a lot of ways, in the sense that, you know, we are starting with an underdeveloped market where people need to be convinced that MRD has a value. And that's been our major focus. We've seen strong results.
Speaker #5: Sure . I mean , you know , I think we've learned a lot from the myeloma experience . And as you noted , have established a really strong position there .
Speaker #5: 45% or so of our comes from that business indication . And we've been able to post strong quarter over quarter growth repeatedly in that space , in part thanks to the of the assay advancement in blood .
Speaker #5: In addition to to bone marrow in DLBCL . I know , playbook think , you looks the similar in a lot of ways in the sense that , you are starting with a an underdeveloped people need to market where be convinced that MRD has a value .
Susan Bobulsky: You know, in Q4, we saw 14% quarter-over-quarter growth sequentially in DLBCL, I think 115% versus Q4 of the prior year. But we're still, like you said, only at 3% of penetration of the patient opportunity. We do believe that increased noise in this space has potential to really help expand the market. And so we'll be continuing to focus on the things that we think are the major drivers, which are data generation with our enhanced ctDNA assay that we launched early last year, further advancing the guidelines, which we made some significant initial progress a year ago, broadening commercial payer coverage, which will help boost our ASPs, and deepening penetration with pharma, where the interest in MRD-guided trial designs in DLBCL is really, is really ramping up.
Susan Bobulsky: You know, in Q4, we saw 14% quarter-over-quarter growth sequentially in DLBCL, I think 115% versus Q4 of the prior year. But we're still, like you said, only at 3% of penetration of the patient opportunity. We do believe that increased noise in this space has potential to really help expand the market. And so we'll be continuing to focus on the things that we think are the major drivers, which are data generation with our enhanced ctDNA assay that we launched early last year, further advancing the guidelines, which we made some significant initial progress a year ago, broadening commercial payer coverage, which will help boost our ASPs, and deepening penetration with pharma, where the interest in MRD-guided trial designs in DLBCL is really, is really ramping up.
Speaker #5: And that's been our major focus . And we've seen strong results . You know , in Q4 , we saw 14% quarter over quarter growth sequentially in DLBCL .
Speaker #5: I think 115% versus Q4 of the prior year . But we're still , like you said , only at 3% of penetration of the patient We opportunity .
Speaker #5: do believe increased noise in this that space has potential to really help expand the market . And so we'll be focus on continuing to the things that we think are the major drivers , which are data with our generation enhanced ctDNA assay that we launched early last year , further advancing the guidelines , which we made some significant initial progress a year ago , broadening commercial payer coverage , which will help boost our ASPs and deepening penetration with pharma , where the interest in MRD guided trial designs in DLBCL is really is really ramping continue to up .
Susan Bobulsky: And we'll continue to underscore the sensitivity of our assay, but also the specificity, which is really crucial, both in the clinic and in interventional studies. We'll continue to rely on some of the other strengths and sort of head starts that we've built, including our reimbursement, our strong relationships with hematologists who are treating this both in the community and academia, and, you know, the data, the head start in data that we've accomplished as other entrants come in and determine what their path forward will be.
Susan Bobulsky: And we'll continue to underscore the sensitivity of our assay, but also the specificity, which is really crucial, both in the clinic and in interventional studies. We'll continue to rely on some of the other strengths and sort of head starts that we've built, including our reimbursement, our strong relationships with hematologists who are treating this both in the community and academia, and, you know, the data, the head start in data that we've accomplished as other entrants come in and determine what their path forward will be.
Speaker #5: We'll underscore the sensitivity assay of our platform, but also the specificity, which is really crucial both in the clinic and in interventional studies. We'll continue to rely on some of the other strengths and sort of head starts that we've built, including our reimbursement, our strong relationships with hematologists who are treating this both in the community and in academia.
Speaker #5: And , you know , the data , the head start and data that we've we've accomplished as other entrants come in and determine what their their path forward will be .
David Westenberg: Thank you, Susan. That was very comprehensive. Well, hop out of queue.
David Westenberg: Thank you, Susan. That was very comprehensive. Well, hop out of queue.
Speaker #4: Thank you . Susan . That was very I'll hop out of comprehensive . Q .
Operator: Thank you. Our next question comes from Subbu Nambi with Guggenheim. Your line is open.
Operator: Thank you. Our next question comes from Subbu Nambi with Guggenheim. Your line is open.
Speaker #3: Thank you . Our next question comes from Sabu Nambi with Guggenheim . Your line is open .
[Analyst] (Guggenheim): Hey, guys. Thank you for taking my question. A competitor came out this week with a flow cytometer, positioning as competitive to NGS for myeloma and probably a significant price advantage. Would love to hear your thoughts on this product from both sensitivity and pricing perspective.
Subbu Nambi: Hey, guys. Thank you for taking my question. A competitor came out this week with a flow cytometer, positioning as competitive to NGS for myeloma and probably a significant price advantage. Would love to hear your thoughts on this product from both sensitivity and pricing perspective.
Speaker #6: Hey , guys . Thank you for taking my question . A competitor came out this week with a flow assay positioning to NGS competitive cytometer as for myeloma , and probably a significant price advantage .
Speaker #6: Would love to hear your thoughts on this product from both a sensitivity and pricing perspective.
Susan Bobulsky: Sure. You know, it's interesting to see that Quest has launched a product in the space. You know, from our perspective, it's not particularly a new dynamic for us. There are competitors already offering next-generation flow products with similar sensitivity claims in our space. But what we know is that flow-based methods for MRD assessment are inherently less sensitive than clonoSEQ, and they always will be, for any given amount of sample material. Obviously, Quest hasn't published any data yet, but their claim that their sensitivity is comparable to clonoSEQ is hard for us to reconcile. Their stated sensitivity is 5 × 10 to the negative sixth, which is equivalent to 1 in 200,000 with 10ml of blood.
Susan Bobulsky: Sure. You know, it's interesting to see that Quest has launched a product in the space. You know, from our perspective, it's not particularly a new dynamic for us. There are competitors already offering next-generation flow products with similar sensitivity claims in our space. But what we know is that flow-based methods for MRD assessment are inherently less sensitive than clonoSEQ, and they always will be, for any given amount of sample material. Obviously, Quest hasn't published any data yet, but their claim that their sensitivity is comparable to clonoSEQ is hard for us to reconcile. Their stated sensitivity is 5 × 10 to the negative sixth, which is equivalent to 1 in 200,000 with 10ml of blood.
Speaker #5: Sure , you know , it's to see that quest had launched a in the space . From our perspective , it's not particularly a new dynamic for us .
Speaker #5: There are competitors already offering next generation flow products with similar sensitivity claims our in space , and what we know is that flow based methods for MRD assessment are inherently less sensitive than Clonoseq , and they always will be for any given amount of sample material .
Speaker #5: Obviously, Quest hasn't published any data yet, but their claim that their sensitivity is comparable to clonoSEQ is hard for us to reconcile.
Speaker #5: Their stated times ten to the sensitivity is five negative is equivalent to 1 in 200,000 with a ten millilitres of blood . And as you know , super Clonoseq can routinely achieve clinical sensitivity of 1 in 1,000,005 times higher , with just two millilitres of blood are validated FDA label is sensitivity per even higher .
Susan Bobulsky: And as you know, clonoSEQ can routinely achieve clinical sensitivity of 1 in 1 million, 5 times higher, with just 2 mL of blood. Our validated sensitivity per our FDA label is even higher, around 1 in 1.5 million, and that's the same in both blood and marrow. So the assay that's being launched is, at best, 5 to 7 times less sensitive in blood than clonoSEQ, and I think there's two things to keep in mind with that. One is the myeloma landscape is evolving in a direction that requires more sensitivity, not less. Treatments are driving really deep responses. Most patients now are negative in marrow at a depth of 1 in 200,000. And two, for myeloma, MRD sensitivity is especially important when you're testing in blood.
Susan Bobulsky: And as you know, clonoSEQ can routinely achieve clinical sensitivity of 1 in 1 million, 5 times higher, with just 2 mL of blood. Our validated sensitivity per our FDA label is even higher, around 1 in 1.5 million, and that's the same in both blood and marrow. So the assay that's being launched is, at best, 5 to 7 times less sensitive in blood than clonoSEQ, and I think there's two things to keep in mind with that. One is the myeloma landscape is evolving in a direction that requires more sensitivity, not less. Treatments are driving really deep responses. Most patients now are negative in marrow at a depth of 1 in 200,000. And two, for myeloma, MRD sensitivity is especially important when you're testing in blood.
Speaker #5: One in one, around 5 million. And that's the same in both blood and marrow. So the assay that's being launched is, at best, 5 to 7 times less sensitive in blood than clonoSEQ.
Speaker #5: And I think there's two things to keep in mind with that . One is the landscape is evolving in a direction that requires more sensitivity , not less .
Speaker #5: Treatments are driving really deep responses . Most patients now are negative in marrow at a depth of 1 in 200,002 . For myeloma , MRD sensitivity is especially important when you're testing in blood the biology of myeloma is such that disease burden in blood is , on average 100 times less than in marrow , and physicians know this .
Susan Bobulsky: The biology of myeloma is such that disease burden in blood is on average 100 times less than in marrow. Physicians know this, so they want to use an assay in blood that's maximally sensitive. Remember, in the community in Q4, over 60% of clonoSEQ myeloma MRD testing was done in blood. In that setting, we're also broadly reimbursed. 90+% of patients have zero out-of-pocket costs, and we're broadly EMR integrated in the community with Flatiron and other large integrations. Ultimately, we're talking about another next-gen flow assay that has some similar benefits as clonoSEQ, blood-based testing, turnaround time, broad availability, but with less sensitivity in a sample type where sensitivity is really key. You know, of course, there are a single-digit percentage of patients for whom a diagnostic marrow isn't available to run a clonoSEQ ID test.
Susan Bobulsky: The biology of myeloma is such that disease burden in blood is on average 100 times less than in marrow. Physicians know this, so they want to use an assay in blood that's maximally sensitive. Remember, in the community in Q4, over 60% of clonoSEQ myeloma MRD testing was done in blood. In that setting, we're also broadly reimbursed. 90+% of patients have zero out-of-pocket costs, and we're broadly EMR integrated in the community with Flatiron and other large integrations. Ultimately, we're talking about another next-gen flow assay that has some similar benefits as clonoSEQ, blood-based testing, turnaround time, broad availability, but with less sensitivity in a sample type where sensitivity is really key. You know, of course, there are a single-digit percentage of patients for whom a diagnostic marrow isn't available to run a clonoSEQ ID test.
Speaker #5: So they want to use an assay in blood that's maximally sensitive . So remember in the community in Q4 over 60% of clonoseq myeloma MRD testing was done in blood .
Speaker #5: And in that setting , we're also broadly reimbursed 90 plus percent of patients have zero out-of-pocket costs . And we're broadly EMR integrated in the community with Flatiron and other large integrations .
Speaker #5: So ultimately , another next gen we're talking about flow assay that has some similar benefits as clonoseq blood based testing availability , but with less sensitivity in a sample type where sensitivity is really key .
Speaker #5: So, of course, there are a single-digit percentage of patients for whom a diagnostic marrow isn't available to run a clonoSEQ ID test.
Susan Bobulsky: So for that small subset of patients, perhaps Next-Generation Flow could be a backup option.
Susan Bobulsky: So for that small subset of patients, perhaps Next-Generation Flow could be a backup option.
Speaker #5: For that small patient subset, perhaps next-gen flow could be a backup option.
[Analyst] (Guggenheim): Thank you, Susan, for that. Super helpful. I have a question for Kyle. How do you think about ASP pacing this year? How should we pace it, just given the private payers are in advanced negotiation stage?
Susan Bobulsky: Thank you, Susan, for that. Super helpful. I have a question for Kyle. How do you think about ASP pacing this year? How should we pace it, just given the private payers are in advanced negotiation stage?
Speaker #6: Thank you , Super that . helpful Susan , for . I have a question for Kyle think about . Can't you ASP pacing this year ?
Speaker #6: How should we just given the pace it private payers are in advanced negotiations stage ?
Mark Massaro: Yeah, I mean, I think at this time, it's best to think of it as a linear growth. You know, there are some specific timing things that we've got to lock down and as it relates to some of the key payer contracts we're focused on converting. But I think at this point, you know, where we are in terms of the timing of the year, it's best to just think of it as a linear growth.
Mark Massaro: Yeah, I mean, I think at this time, it's best to think of it as a linear growth. You know, there are some specific timing things that we've got to lock down and as it relates to some of the key payer contracts we're focused on converting. But I think at this point, you know, where we are in terms of the timing of the year, it's best to just think of it as a linear growth.
Speaker #1: mean , I think at this time think of it as a best to it's Yeah , I linear growth . You know , there are some , specific things that timing we've got down .
Speaker #1: to lock relates to it some of , you know payer the key And contracts . We're on , focused on But but I think converting .
Speaker #1: at this you point , know , the are in terms of just think it's best to a linear timing of of it as where we growth the year ,
[Analyst] (Guggenheim): Okay. Thank you so much, Kyle.
Subbu Nambi: Okay. Thank you so much, Kyle.
Operator: Thank you. Our next question comes from Dan Brennan with TD Cowen. Your line is open.
Operator: Thank you. Our next question comes from Dan Brennan with TD Cowen. Your line is open.
Speaker #6: you so much , . . Okay . Thank
Speaker #6: guys
Speaker #3: you . Our next question from Dan Thank Brennan with TD comes Your line Cowen . is open .
Dan Brennan: Great, thanks. Congrats on the quarter. Maybe just first on the EBITDA guide for 2026. So I think you said EBITDA positive, maybe exiting 2026. Can you just flesh it out a little bit? Is that Q3, Q4, was that for the full year? And any help between where MRD versus immune medicine goes and kind of implicit in that, like, are you making any changes to the sales force implicit in that? Is there any more sales force expansion in 2026?
Dan Brennan: Great, thanks. Congrats on the quarter. Maybe just first on the EBITDA guide for 2026. So I think you said EBITDA positive, maybe exiting 2026. Can you just flesh it out a little bit? Is that Q3, Q4, was that for the full year? And any help between where MRD versus immune medicine goes and kind of implicit in that, like, are you making any changes to the sales force implicit in that? Is there any more sales force expansion in 2026?
Speaker #7: Great . the Thanks quarter . just Maybe . Congrats on guide first on the EBITDA for 2026 . So EBITDA positive maybe you said exiting I think 26 .
Speaker #7: just flush it out a little Can U bit . Is Q4 was that Q3 year for the full that and help between MRD any medicine immune goes versus and kind of implicit in that , like , are you making any changes to the Salesforce Is there implicit in that ?
Mark Massaro: On the EBITDA guide, I'd say right now it's an exit on Q4 for the entire company. MRD is obviously positive adjusted EBITDA at this point, but we expect to see that continue to grow. And some of the initiatives across the business we're putting in place, you know, give us confidence to be able to achieve it across the whole company. And I'll let Susan take the field force.
Speaker #7: any expansion sales force more in 26 ?
Mark Massaro: On the EBITDA guide, I'd say right now it's an exit on Q4 for the entire company. MRD is obviously positive adjusted EBITDA at this point, but we expect to see that continue to grow. And some of the initiatives across the business we're putting in place, you know, give us confidence to be able to achieve it across the whole company. And I'll let Susan take the field force.
Speaker #1: EBITDA guide ? I'd say right now exit it's an On the on for the entire . MRD , obviously company positive adjusted point , EBITDA at this expect to see that but we grow continue to of the initiatives .
Speaker #1: across the we're business , putting in place give us confidence to achieve it to be able And some across the whole company . And I'll Susan take the field force .
Susan Bobulsky: Yeah, you know, currently we have about 65 reps in the field. They're split 50/50 between academic and community focus, and we believe this is the right number of reps for now, as our territories are manageable in terms of potential. The reps are calling on the right number of accounts and HCPs, and most of the territories are reasonable size. So, you know, while I'm not saying we don't add a territory here or there opportunistically, and also I will acknowledge that we will continue to evaluate new deployment strategies to, you know, address market dynamics as they evolve, which could justify additional hiring. We're not anticipating in the plan for this year any significant expansion in the sales team.
Susan Bobulsky: Yeah, you know, currently we have about 65 reps in the field. They're split 50/50 between academic and community focus, and we believe this is the right number of reps for now, as our territories are manageable in terms of potential. The reps are calling on the right number of accounts and HCPs, and most of the territories are reasonable size. So, you know, while I'm not saying we don't add a territory here or there opportunistically, and also I will acknowledge that we will continue to evaluate new deployment strategies to, you know, address market dynamics as they evolve, which could justify additional hiring. We're not anticipating in the plan for this year any significant expansion in the sales team.
Speaker #5: you know , currently
Speaker #5: we have Yeah , 65 reps in the about let field . They're split 5050 between and focus . community And we number believe this is the right of for reps now as territories are terms of manageable in our potential .
Speaker #5: reps are on the right number of accounts calling and The and most of hcp's are territories reasonable the size . So saying we I'm not while don't add a territory they're opportunistically also and will here or acknowledge that we I will continue to evaluate new deployment strategies to , you , address know market as they evolve , which could dynamics additional justify hiring .
Speaker #5: not anticipating in plan for the We're this year , any the significant in expansion in the sales team .
Dan Brennan: Terrific. Thanks for that. And, you know, you rattled off a bunch of the progress you made on a lot of the volume drivers between blood, community penetration, and EMR. I'm just wondering, it makes sense to not get ahead of yourselves, but I think, you know, blood really ramped, and I think you're only baking in a little bit of an increase in 2026. Is that just because we're kind of capping out on what's realistic, or is that, you know, is there a reason? And similarly, I think community, I think, you know, really ramped in the fourth quarter, and it looks like you're baking in a little bit of an increase there. Just maybe speak to those two assumptions, and is there some reason why they wouldn't potentially increase further in 2026?
Dan Brennan: Terrific. Thanks for that. And, you know, you rattled off a bunch of the progress you made on a lot of the volume drivers between blood, community penetration, and EMR. I'm just wondering, it makes sense to not get ahead of yourselves, but I think, you know, blood really ramped, and I think you're only baking in a little bit of an increase in 2026. Is that just because we're kind of capping out on what's realistic, or is that, you know, is there a reason? And similarly, I think community, I think, you know, really ramped in the fourth quarter, and it looks like you're baking in a little bit of an increase there. Just maybe speak to those two assumptions, and is there some reason why they wouldn't potentially increase further in 2026?
Speaker #7: Thanks for And you rattled that . off a bunch Terrific . of the progress you made on a lot of the volume drivers between community blood EMR .
Speaker #7: penetration and wondering , it makes sense to I'm of not get ahead just I yourselves , but blood think really ramped and I think you're bit of an only baking increase in Is that we're kind of just because in a little capping 26 .
Speaker #7: realistic , or is there a reason ? out on what's And is that suddenly I think is community , I think , you know , really ramped in the looks like you're fourth quarter and it baking in a little bit of an increase there , just maybe speak to those two .
Susan Bobulsky: Yeah, right. So, I think in both cases, there is no... we're not capping out, and we don't believe that there isn't any reason they couldn't potentially increase further. But we are sort of looking historically at what the pace has been of progress, and then thinking about, you know, balancing the various drivers and sort of being prudent around what we set up as expectations at the beginning of the year. But, you know, on the blood-based testing front, you know, we were at 47%, in Q4, overall blood-based testing, and 27%... Oh, sorry, 45%, and then 27% for myeloma specifically. Myeloma is a really big opportunity to grow that.
Susan Bobulsky: Yeah, right. So, I think in both cases, there is no... we're not capping out, and we don't believe that there isn't any reason they couldn't potentially increase further. But we are sort of looking historically at what the pace has been of progress, and then thinking about, you know, balancing the various drivers and sort of being prudent around what we set up as expectations at the beginning of the year. But, you know, on the blood-based testing front, you know, we were at 47%, in Q4, overall blood-based testing, and 27%... Oh, sorry, 45%, and then 27% for myeloma specifically. Myeloma is a really big opportunity to grow that.
Speaker #7: some reason assumptions is there And why they potentially wouldn't increase further
Speaker #7: in 26 .
Speaker #5: Yeah .
Speaker #5: So, right. I think there is, in both cases, no—we're not capping out, and we don't believe that there isn't any reason that they couldn't potentially increase further.
Speaker #5: But we are sort of looking historically the pace has at what been of progress . And then thinking about , you know , balancing the various drivers and sort of being prudent around what we as set up expectations at the beginning of the year .
Speaker #5: But I , you know , on the blood based testing front we're , you know , we were at 47% in overall Q4 blood based testing and sorry , 27% , oh , 45% .
Speaker #5: And then myeloma , specifically a really 27% for , myeloma is big grow that opportunity to we grow . Additionally , if mantle , our continue to lymphoma DLBCL and indications disproportionately to the rest of the will blood business , we see as a to the contribution business , total continue ramp .
Susan Bobulsky: Additionally, if we continue to grow DLBCL and mantle cell, our lymphoma indications disproportionately to the rest of the business, we will see blood as a contribution to the total business continue to, to ramp. So, I think there is upside, but we are confident that we can get to above 50% in 2026, and same thing on the community side. You know, the guide that we have is over 35% of the business coming from community. It was 31% in 2025, and we closed the year in Q4 at 33%. So, you know, we hope to exit above 35%, by the end of this year. It'll be a big area of focus, and it is a disproportionate area of investment for us.
Susan Bobulsky: Additionally, if we continue to grow DLBCL and mantle cell, our lymphoma indications disproportionately to the rest of the business, we will see blood as a contribution to the total business continue to, to ramp. So, I think there is upside, but we are confident that we can get to above 50% in 2026, and same thing on the community side. You know, the guide that we have is over 35% of the business coming from community. It was 31% in 2025, and we closed the year in Q4 at 33%. So, you know, we hope to exit above 35%, by the end of this year. It'll be a big area of focus, and it is a disproportionate area of investment for us.
Speaker #5: So to to I think there upside . But there we are confident that we can is above get to 50% in 2026 . And same thing on the side .
Speaker #5: community the the You know , have is guide over is that we coming from community . It was 31% 35% of the business And we in 2025 .
Speaker #5: Closed the year in Q4 at 33. So, you know, we hope to exit above 35 by the end of this year.
Speaker #5: And be a big area of it'll focus . And it is a disproportionate area of investment for us . It's where our competitors are likely to focus , and it's know , where , you things like the key data sets like Midas that came out in multiple myeloma , helping inform the potential avoidance of That's a transplant .
Susan Bobulsky: It's where our competitors are likely to focus, and it's where, you know, things like the key data sets, like MIDAS, that came out in Multiple Myeloma, helping inform the potential avoidance of transplant. That's a really big deal in the community. Favorable guideline updates. Guidelines matter a lot to community clinicians, so we'll continue to focus on those things and also continue to drive new testing pathways in large community practice networks that help us standardize utilization of the assay across indications. And those things will, again, be drivers, combined with our Flatiron integration and the serial testing that we can achieve through that, which have some potential upside in 2026.
Susan Bobulsky: It's where our competitors are likely to focus, and it's where, you know, things like the key data sets, like MIDAS, that came out in Multiple Myeloma, helping inform the potential avoidance of transplant. That's a really big deal in the community. Favorable guideline updates. Guidelines matter a lot to community clinicians, so we'll continue to focus on those things and also continue to drive new testing pathways in large community practice networks that help us standardize utilization of the assay across indications. And those things will, again, be drivers, combined with our Flatiron integration and the serial testing that we can achieve through that, which have some potential upside in 2026.
Speaker #5: really big deal in the community . Favorable guideline updates , guidelines matter a lot to we'll continue to focus on those things . And community clinicians , so also new drive continue to testing pathways in large community practice standardize that help us assay networks utilization of across things indications and the those will again be drivers combined with our Flatiron integration and the serial can testing that we achieve that through which have some potential upside in 2026 .
Operator: Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. Again, that is star one one to ask a question. Our next question comes from Mark Massaro with BTIG. Your line is open.
Operator: Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. Again, that is star one one to ask a question. Our next question comes from Mark Massaro with BTIG. Your line is open.
Speaker #3: Thank you . As a reminder to ask a question , please press star one one on your telephone and wait for your name to be announced again .
Speaker #3: That is one, Star. One to ask a question. Our next question comes from Mark Massaro with BTIG. Mark, your line is open.
Mark Massaro: Hey, guys, thanks for taking the questions. Congrats on a strong 2025. I wanted to start on gross margins. It looks like they came in at 66% sequencing, for the full year, and you hope to expand that to over 70% in 2026. I guess there are a number of parts to this, and where I'm going with this is, you know, your ASPs are still rising. In fact, last month, you indicated a plan to get to $1,700 to 1,800 in ASPs by 2029. So I guess my question is, the over 70% level in 2026. My sense is that you're not fully loaded there of long term.
Mark Massaro: Hey, guys, thanks for taking the questions. Congrats on a strong 2025. I wanted to start on gross margins. It looks like they came in at 66% sequencing, for the full year, and you hope to expand that to over 70% in 2026. I guess there are a number of parts to this, and where I'm going with this is, you know, your ASPs are still rising. In fact, last month, you indicated a plan to get to $1,700 to 1,800 in ASPs by 2029. So I guess my question is, the over 70% level in 2026. My sense is that you're not fully loaded there of long term.
Speaker #8: Hey guys , thanks for taking the questions . Congrats on a strong 2025 . I wanted to start on gross margins like . Looks they came in at 66% sequencing year , full for the and you hope to expand you that to over 70% in 2026 .
Speaker #8: guess I there are a to this and number of where I'm going with parts is this , you know , your ASPs are are still rising .
Speaker #8: fact , month indicated a you plan to In get to 17 to 1800 in ASPs by 2029 . So I guess my question is the over 70% level in 2026 , my sense is that you're not fully loaded .
Mark Massaro: So is there any way you could give me a sense that, you know, maybe 3, 4 years from now, you could be, perhaps meaningfully above 70%? Or do you think that that's a pretty good place to consider in the out years?
Mark Massaro: So is there any way you could give me a sense that, you know, maybe 3, 4 years from now, you could be, perhaps meaningfully above 70%? Or do you think that that's a pretty good place to consider in the out years?
Speaker #8: There term long . So is there any way you could give me a sense that , you know , maybe three , four years from now , you could be perhaps meaningfully above 70% ?
Speaker #8: Or do you think that pretty good that's a place to to consider in the years out
Susan Bobulsky: Yeah, Mark, Chad, as you know, I'll start, and then I can pass it off to Kyle if you wanna kind of double click on anything that I'm saying. But, first of all, at J.P. Morgan, we came out and kind of moved that number already up from 70 to 75%. So, you're absolutely right, we're not fully loaded in the sense that the transition to NovaSeq X Plus, if you recall, just happened in the back half of this year. So we talked about a 5 to 8% increase in the first 12 months and over a 10% increase, just attributable to the NovaSeq X Plus transition.
Susan Bobulsky: Yeah, Mark, Chad, as you know, I'll start, and then I can pass it off to Kyle if you wanna kind of double click on anything that I'm saying. But, first of all, at J.P. Morgan, we came out and kind of moved that number already up from 70 to 75%. So, you're absolutely right, we're not fully loaded in the sense that the transition to NovaSeq X Plus, if you recall, just happened in the back half of this year. So we talked about a 5 to 8% increase in the first 12 months and over a 10% increase, just attributable to the NovaSeq X Plus transition.
Speaker #2: Mark , ? Yeah . I'll this chat , as you know , I'll then I start and can pass it off to Kyle if you want to double click on anything that that I'm saying .
Speaker #2: I'll ,
Speaker #2: But first of all . At JP we came out and kind of moved that number already up from 70 to 75% . So and you're absolutely right .
Speaker #2: We're not fully loaded in the sense that the transition to Novaseq . Plus , if you recall , just happened in the back half of this year .
Speaker #2: So, we talked about a 5 to 8% percentage increase in the first 12 months, and over a 10% increase—just to triple—attributable to the NovaSeq X Plus. We're going to get a significant, significant amount of additional uplift from that as you layer more samples on the same sequencing run.
Susan Bobulsky: So, you know, you're gonna get a significant amount of additional uplift from that as you layer more samples on the same sequencing run. So that's a big one. The second, as you noticed, as you mentioned, is ASP. So as you continue kind of growing on the top line along with, you know, better cost per sample, that margin continues to increase. So, you know, I think there's probably some even upside further from there, but, you know, we're gonna, at this point, you know, sequentially walk it up as we have from 70 to 75%. But we are very confident in long-term, durable, you know, high margin profile, both at the gross and the operating margin level.
Susan Bobulsky: So, you know, you're gonna get a significant amount of additional uplift from that as you layer more samples on the same sequencing run. So that's a big one. The second, as you noticed, as you mentioned, is ASP. So as you continue kind of growing on the top line along with, you know, better cost per sample, that margin continues to increase. So, you know, I think there's probably some even upside further from there, but, you know, we're gonna, at this point, you know, sequentially walk it up as we have from 70 to 75%. But we are very confident in long-term, durable, you know, high margin profile, both at the gross and the operating margin level.
Speaker #2: that's that's a big one . as you notice , as you So mentioned , is The second , ASP . continue kind of growing top on the line , with , you know , better cost per sample , that margin continues to So , you know , I think there's increase .
Speaker #2: even probably some upside there . further from But you know we'll we're going to going to at this we're sequentially lock it as we have up 70 to 75% .
Speaker #2: But we from are very in long confident term high margin durable , profile , both at the gross operating margin and the level .
Mark Massaro: That's super helpful. Thank you. Then maybe just to drill into ASPs. I think you guys indicated that you exited 2025 at $1,350 a test, and you came in at-
Mark Massaro: That's super helpful. Thank you. Then maybe just to drill into ASPs. I think you guys indicated that you exited 2025 at $1,350 a test, and you came in at-
Speaker #8: super helpful . And then Thank you . maybe just to into drill , I ASPs That's you guys indicated that think exited 2025 you at 1350 .
Susan Bobulsky: Mm-hmm
Susan Bobulsky: Mm-hmm
Mark Massaro: ... $1,307 for the full year, which is up 17%. So can you maybe share why is 1,400 the right rate in 2026? That's a 7% growth. Are there any particular items you could point to that might sort of not create for a similar growth rate in 2026 than 2025?
Mark Massaro: ... $1,307 for the full year, which is up 17%. So can you maybe share why is 1,400 the right rate in 2026? That's a 7% growth. Are there any particular items you could point to that might sort of not create for a similar growth rate in 2026 than 2025?
Speaker #8: You came in and test in at 1,307 for the full year, which is up 17%. So can you share why maybe 1,400 is the right rate in 2026?
Speaker #8: That's 7% growth . a Are there any could point items you particular to that might sort of create for a not similar growth rate in 26 and 25 ?
Kyle Piskel: Sure. Thanks for the question, Mark. Remember in 2025, you know, we saw a meaningful growth across a number of initiatives, but one of the biggest ones was the gap fill rate that went into effect right at the onset of the year for our Medicare business, our Medicare fee-for-service business. So that provided, you know, a decent amount of the growth in 2025. We're starting to get some traction on the commercial side as we've implemented, you know, contract rate renegotiations and new payer rates. I think as it relates to, you know, 2026, I think right now, hey, we wanna be, you know, with where we are during the year, wanna be, you know, prudent around guiding around ASP. There are kind of two, I'll say two major things we're really focused on.
Kyle Piskel: Sure. Thanks for the question, Mark. Remember in 2025, you know, we saw a meaningful growth across a number of initiatives, but one of the biggest ones was the gap fill rate that went into effect right at the onset of the year for our Medicare business, our Medicare fee-for-service business. So that provided, you know, a decent amount of the growth in 2025. We're starting to get some traction on the commercial side as we've implemented, you know, contract rate renegotiations and new payer rates. I think as it relates to, you know, 2026, I think right now, hey, we wanna be, you know, with where we are during the year, wanna be, you know, prudent around guiding around ASP. There are kind of two, I'll say two major things we're really focused on.
Speaker #1: Sure . Thanks for the question mark Remember . in 2025 , you know , meaningful growth we saw across a number of initiatives .
Speaker #1: But one of the biggest ones was the gap sell rate that went into effect right at the onset of the year, for our Medicare business.
Speaker #1: Our Medicare fee for service business . So that provided , you know , a decent amount of growth in 2025 . We're starting to get some on the commercial side as we traction implemented , you know , contract rate renegotiations and new payer think as it I relates to , you know , rates .
Speaker #1: 2026 , now , hey , right to I think be , you we want know , with during the are where we year be , you know , prudent guiding around around ASP .
Kyle Piskel: One is, you know, renegotiating with two large payers that kind of move a significant amount of our volume, you know, upwards of 17% to 18% of our volume. And so getting those rates established at the appropriate rate is really important, and the timing of that can drive variability and ultimately the ASPs we realize for the full year. The second piece, as Susan mentioned, we're, you know, we're anticipating growth in DLBCL and MCL, but to the extent that growth is, you know, even better than we thought, you know, we've got to kind of navigate the coverage dynamics on the commercial payer front, and hopefully we can continue to see positive coverage decisions with regards to those indications.
Kyle Piskel: One is, you know, renegotiating with two large payers that kind of move a significant amount of our volume, you know, upwards of 17% to 18% of our volume. And so getting those rates established at the appropriate rate is really important, and the timing of that can drive variability and ultimately the ASPs we realize for the full year. The second piece, as Susan mentioned, we're, you know, we're anticipating growth in DLBCL and MCL, but to the extent that growth is, you know, even better than we thought, you know, we've got to kind of navigate the coverage dynamics on the commercial payer front, and hopefully we can continue to see positive coverage decisions with regards to those indications.
Speaker #1: are kind of two , I'll We're really say two major There things . focused on . One is , you know , with two large that renegotiating kind of move a , you significant know , a amount of payers volume , you know , our upwards of 17 to 18% of our so getting those volume .
Speaker #1: established rates appropriate rate is important . And the at the And timing can really of that drive variability . And ASPs the we year full realize for the ultimately the , second piece , Susan as growth in anticipating DLBCL mentioned , we're and MCL .
Speaker #1: you know , we're extent But to the you know , that even better than growth is , thought , you know we , we've got to kind of navigate the dynamics on the commercial coverage payer front .
Speaker #1: And hopefully we can positive coverage decisions with regards to those just want to But , you be know , again , prudent in managing that .
Kyle Piskel: But, you know, again, we just wanna be prudent in managing that and monitoring it over time.
Kyle Piskel: But, you know, again, we just wanna be prudent in managing that and monitoring it over time.
Mark Massaro: That's great. Thanks, guys.
Mark Massaro: That's great. Thanks, guys.
Speaker #1: And we monitoring it over time .
Speaker #8: That's great . Thanks guys .
Operator: Thank you. Our next question comes from Sebastian Sandler with J.P. Morgan. Your line is open.
Operator: Thank you. Our next question comes from Sebastian Sandler with JPMorgan. Your line is open.
Speaker #3: Thank you . Our next question comes from Sebastian Sandler with J.P. Morgan . Your line is open .
Sebastian Sandler: Great, thanks for taking the question. Can you walk us through where you see upside to the clonoSEQ volume guide in the year? You know, I think it implies pretty healthy community volume growth. Looks like around 50% year-over-year, depending on what you assume, more than 35% of total volume means. But where would you point to there being the most potential upside, whether that's NeoGenomics contribution, guidelines, incremental recurrence, monitoring coverage? Just walk us through that. I think that would be helpful to get a grasp of.
Sebastian Sandler: Great, thanks for taking the question. Can you walk us through where you see upside to the clonoSEQ volume guide in the year? You know, I think it implies pretty healthy community volume growth. Looks like around 50% year-over-year, depending on what you assume, more than 35% of total volume means. But where would you point to there being the most potential upside, whether that's NeoGenomics contribution, guidelines, incremental recurrence, monitoring coverage? Just walk us through that. I think that would be helpful to get a grasp of.
Speaker #9: Great . Thanks taking for question the . Can you walk us through where you upside to the Clonoseq see volume guide in the air ?
Speaker #9: know , I think it You implies pretty healthy community volume growth . Looks like around 50% year on year , depending on what you assume , more than 35% of total volume means .
Speaker #9: there where But point to would you being the most potential upside ? genomics Neo , contribution incremental recurrence guidelines , monitoring , coverage , walk us just through that .
Susan Bobulsky: Sure. I mean, from a volume perspective on the clinical business, I think one of the areas of upside, just based on sort of. We're in early days and have limited experiences in terms of EMR integration, the Flatiron integration, and the serial testing, which we've talked a little bit about over the last quarter or so. We're really just starting to see what the pull-through on serial testing looks like, and so far we've been pleased to see that about 60% of serial tests are actually showing up as scheduled.
Susan Bobulsky: Sure. I mean, from a volume perspective on the clinical business, I think one of the areas of upside, just based on sort of. We're in early days and have limited experiences in terms of EMR integration, the Flatiron integration, and the serial testing, which we've talked a little bit about over the last quarter or so. We're really just starting to see what the pull-through on serial testing looks like, and so far we've been pleased to see that about 60% of serial tests are actually showing up as scheduled.
Speaker #9: I think that would be helpful to get a grasp of.
Speaker #5: Sure . I mean , from a volume perspective on the clinical business , I think one of the areas of , just upside based on sort of the early we're in early days and have limited experiences in terms of EMR integration Flatiron .
Speaker #5: The integration and the serial testing , which little bit about over the we've talked a last quarter or so . We're really just starting to see what the pull on through serial testing like .
Speaker #5: And so far we've looks to see that pleased about 60% of of tests are serial actually showing up as scheduled . And so we think there are opportunities to potentially continue to focus on that and see if we can improve it , or at the very least , ensure that we continue to see strong contribution from serial testing , which could to what we've upside we've have what guided and forecasted .
Susan Bobulsky: And so, you know, we think there are opportunities to potentially continue to focus on that and see if we can improve it, or at the very least, ensure that we continue to see strong contribution from serial testing, which could have upside to what we've forecasted and guided. Additionally, on the EMR side, we've increased the focus on already integrated sites to what we call optimize those sites. This is things like standardizing order sets to increase testing consistency or further reducing friction in integrated workflows, which will improve order pull-through. Those kinds of initiatives are new, but the early results from pilots that we've completed have been very strong, and so I think there's a lot of promise there and source of upside.
Susan Bobulsky: And so, you know, we think there are opportunities to potentially continue to focus on that and see if we can improve it, or at the very least, ensure that we continue to see strong contribution from serial testing, which could have upside to what we've forecasted and guided. Additionally, on the EMR side, we've increased the focus on already integrated sites to what we call optimize those sites. This is things like standardizing order sets to increase testing consistency or further reducing friction in integrated workflows, which will improve order pull-through. Those kinds of initiatives are new, but the early results from pilots that we've completed have been very strong, and so I think there's a lot of promise there and source of upside.
Speaker #5: Additionally , on the EMR side , increased focus the we've on already integrated sites call optimize to what we sites . This is things like standardizing order increase sets to testing consistency or further reducing the friction .
Speaker #5: And integrated workflows, which improve order, will pull through. Those kinds of initiatives are new, but the early results from pilots that we've completed have been very strong.
Susan Bobulsky: You know, I talked about, you know, potential for upside on our anticipated contributions on blood and on the community, and those will be areas of continued focus. You know, the other thing is that, you know, on the ASP side, we have some, you know, key payer contracts that we're still in the process of renegotiating. So the timing of those can be a source of upside on revenue, as can potentially, you know, the negotiations turning out more favorably than we think. But, you know, overall, I think we feel like-
Susan Bobulsky: You know, I talked about, you know, potential for upside on our anticipated contributions on blood and on the community, and those will be areas of continued focus. You know, the other thing is that, you know, on the ASP side, we have some, you know, key payer contracts that we're still in the process of renegotiating. So the timing of those can be a source of upside on revenue, as can potentially, you know, the negotiations turning out more favorably than we think. But, you know, overall, I think we feel like-
Speaker #5: And so I think there's a lot of promise there and source of upside . You know , I talked about , you know , potential for for our upside on anticipated on contributions blood and on the community .
Speaker #5: those will be And areas of continued focus . You know , the other thing is that , you know , on the ASP side , we have you know , some , key payer contracts that we're still in the process of renegotiating .
Speaker #5: So the timing of those can be a source of upside on revenue , as can potentially , you know , negotiations turning out more favorably think .
[Company Representative] (Adaptive Biotechnologies): ... this guide is very reasonable, and, you know, we are being prudent early in the year, but there are many different ways that this business can be driven and can be accelerated, and all these things kind of work together. So it's one of the things that we like about this business and one of the reasons we're, we're very confident that we can meet or exceed our goals.
Susan Bobulsky: ... this guide is very reasonable, and, you know, we are being prudent early in the year, but there are many different ways that this business can be driven and can be accelerated, and all these things kind of work together. So it's one of the things that we like about this business and one of the reasons we're, we're very confident that we can meet or exceed our goals.
Speaker #5: than we , you think know , overall , I we like feel this very guide is reasonable . And , we are being prudent early in the year .
Speaker #5: But there are many ways that this business can be driven and can be accelerated . And all these things kind of work together .
Speaker #5: So it's one of the things that we like about this business . one of the reasons we're very confident that we And or exceed our goals .
Chad Robins: Yeah, and just to kind of add a fine point to that, because I mentioned kind of this playbook, and Susan was talking about all these things working together. We. There were five things last year that drove the business: blood-based testing, community, data results, data readouts, guidelines, and EMR integrations. Those are the five things we're reinvesting in this year, and those are the things that we are going to drive growth, not only drive growth, but also give us an opportunity to be extremely confident in our guide and hopefully outperform.
Chad Robins: Yeah, and just to kind of add a fine point to that, because I mentioned kind of this playbook, and Susan was talking about all these things working together. We. There were five things last year that drove the business: blood-based testing, community, data results, data readouts, guidelines, and EMR integrations. Those are the five things we're reinvesting in this year, and those are the things that we are going to drive growth, not only drive growth, but also give us an opportunity to be extremely confident in our guide and hopefully outperform.
Speaker #2: Yeah , just a a fine point to that , because I mentioned kind playbook of this and Susan's comment about all these things working together .
Speaker #2: There were five things last year that drove the business blood based testing community data , results , data readouts , guidelines and EMR integrations .
Speaker #2: And those are the five things we're reinvesting in this year . And those are the things that we are going to drive growth , not only drive growth , but also give us an opportunity be to extremely confident in our guide and hopefully outperform .
Sebastian Sandler: That's helpful. Thank you. Maybe touching on the ASP guide for 2026, it seems like $1,400 is dependent to some degree on those two contracts you called out. Can you give us a sense of any sort of execution risk there or whether those contracts are kind of locked down at this point? And then just, you know, if those contracts were less favorable than expected, can you quantify where ASP could land? And any sense on whether, I know you said to keep ASP flat or kind of linear throughout the year, but any sense of whether this is more of a first half or second dynamic, first half or second half dynamic would be helpful. Thank you.
Sebastian Sandler: That's helpful. Thank you. Maybe touching on the ASP guide for 2026, it seems like $1,400 is dependent to some degree on those two contracts you called out. Can you give us a sense of any sort of execution risk there or whether those contracts are kind of locked down at this point? And then just, you know, if those contracts were less favorable than expected, can you quantify where ASP could land? And any sense on whether, I know you said to keep ASP flat or kind of linear throughout the year, but any sense of whether this is more of a first half or second dynamic, first half or second half dynamic would be helpful. Thank you.
Speaker #9: That's helpful . Thank you . Maybe touching on the guide ASP for 26 , it seems like $1,400 is to those degree on two contracts .
Speaker #9: some dependent You called out . give us Can you a sense of any sort of execution risk there , or whether those contracts are kind of locked down at this point just , you know , if those contracts were less favorable than expected , can you quantify where could land ASP and any sense on whether , you know , you said to keep ASP flat or kind of linear throughout the year , but any sense of whether this is more of a first half or second dynamic , first first half or second half dynamic would be helpful .
Kyle Piskel: Yeah, I mean, there's certainly some level of execution risk, otherwise, I think we wouldn't be in the stage we're at. But, you know, we're confident in getting there in the long term, and we want to make sure we're establishing the right rate. That's really the priority with these payers. As it relates to the dynamics in terms of pacing, yeah, I mean, it's probably more of a second-half dynamic, just given where we're at in January. But I think at the end of the day, you know, if those things don't come in, then, you know, it does represent some minor risk, but there's other levers within the business that we can pull on to continue to grow ASP.
Kyle Piskel: Yeah, I mean, there's certainly some level of execution risk, otherwise, I think we wouldn't be in the stage we're at. But, you know, we're confident in getting there in the long term, and we want to make sure we're establishing the right rate. That's really the priority with these payers. As it relates to the dynamics in terms of pacing, yeah, I mean, it's probably more of a second-half dynamic, just given where we're at in January. But I think at the end of the day, you know, if those things don't come in, then, you know, it does represent some minor risk, but there's other levers within the business that we can pull on to continue to grow ASP.
Speaker #9: Thank you .
Speaker #1: Yeah . I mean , there's certainly some level of execution risk . Otherwise I think we wouldn't be in the stage . We're at .
Speaker #1: But you know , we're confident in the long term . getting there in want to make sure we're establishing the right rate . That's that's really the priority with these payers as it relates to the dynamics in terms of pacing .
Speaker #1: Yeah , I mean , it's probably more of a second half dynamic . Just given where we're at in But I January . think at the end of the day , you know those , if come does know , it in , you represent some things don't minor risk .
Speaker #1: But other there's other levers within business that the we can pull on to continue to grow . ASP .
Chad Robins: Yeah, I mean, just to... We're quite confident in the ASP guide, and we've got multiple levers to get there. You know, one contract or another is not going to necessarily impact that. We're going to get there.
Chad Robins: Yeah, I mean, just to... We're quite confident in the ASP guide, and we've got multiple levers to get there. You know, one contract or another is not going to necessarily impact that. We're going to get there.
Speaker #2: Yeah , I mean , just to we're confident in the quite ASP guys , got multiple levers to get there . You know , another is one contract or not going to impact necessarily that .
Speaker #2: going to get there We're .
Bill Bonello: Thank you. And then our final question comes from Bill Bonello with Craig-Hallum Capital Group. Your line is open.
Bill Bonello: Thank you. And then our final question comes from Bill Bonello with Craig-Hallum Capital Group. Your line is open.
Speaker #3: you . And our then final Thank question comes from Bill Bonilla with Craig-hallum Group . Your line is open capital .
[Analyst] (Craig-Hallum Capital Group): Hey, guys, thanks a lot. Good quarter, and I applaud you for the prudence. I'm going to go a different way here. Given the pre-release, what really stood out to us were actually the comments on the IM business, which I know you don't talk about all that much, and you don't want people to get out over their skis. But clearly, you know, the way you're positioning this is, you know, much less as a therapy development business and much more as a data and informatics business, and it was good to hear about, you know, a couple of big contracts.
Bill Bonello: Hey, guys, thanks a lot. Good quarter, and I applaud you for the prudence. I'm going to go a different way here. Given the pre-release, what really stood out to us were actually the comments on the IM business, which I know you don't talk about all that much, and you don't want people to get out over their skis. But clearly, you know, the way you're positioning this is, you know, much less as a therapy development business and much more as a data and informatics business, and it was good to hear about, you know, a couple of big contracts.
Speaker #10: Good guys . Thanks a lot . quarter . And I applaud you for the prudence Hey going to go way . I'm a .
Speaker #10: different here really , What pre-release , what given the really stood out to us were the actually on comments on the the IAM know you which I don't about much and business , all that to get talk you don't want people out over skis , their but know , the way you're clearly , you positioning this is , you know , is , much less as a therapy development business and much a more as data and informatics hear business .
[Analyst] (Craig-Hallum Capital Group): I know it's probably early days on this strategy, but you know, would love to hear any thinking you have around sort of ways that you monetize this, you know, leading database that you've created and sort of ultimately how we might think about, you know, how a business like this could scale out over time.
Bill Bonello: I know it's probably early days on this strategy, but you know, would love to hear any thinking you have around sort of ways that you monetize this, you know, leading database that you've created and sort of ultimately how we might think about, you know, how a business like this could scale out over time.
Speaker #10: was good to about And it a , you know , couple of big it's contracts . I know probably this early days on but , you strategy , know , would love to hear any thinking you have sort around of ways that you that monetize this this , you know , leading that you've and created database how we sort of might think ultimate about how a could , business could like this over time scale out .
Chad Robins: Sure, Sharon, you want to take that?
Chad Robins: Sure, Sharon, you want to take that?
[Company Representative] (Adaptive Biotechnologies): Yeah, thanks for the question. So, as you alluded to, we're excited by the two distinct Pfizer deals, including both of which were data licensing deals, and we certainly look forward to continuing and believe that we can sort of rinse and repeat, similar or even, you know, sort of differentiated, additional data licensing deals. And really, this stems from the fact that we've generated this really massive, differentiated data sets, that certainly, there's value across applying in different immunology applications, and solving different immunology problems. So, it's early days, but more to come as the year progresses, and we're super excited and enthusiastic in terms of where we are and where we're going.
Chad Robins: Yeah, thanks for the question. So, as you alluded to, we're excited by the two distinct Pfizer deals, including both of which were data licensing deals, and we certainly look forward to continuing and believe that we can sort of rinse and repeat, similar or even, you know, sort of differentiated, additional data licensing deals. And really, this stems from the fact that we've generated this really massive, differentiated data sets, that certainly, there's value across applying in different immunology applications, and solving different immunology problems. So, it's early days, but more to come as the year progresses, and we're super excited and enthusiastic in terms of where we are and where we're going.
Speaker #2: And you want Sure , sure . to take ?
Speaker #2: that
Speaker #11: Yeah . Thanks for the
Speaker #11: question . alluded to , we're So as you excited by the two deals , including both of which were licensing data deals certainly .
Speaker #11: look And we forward to continuing and believe that we can sort of rinse and repeat similar or , you know , even sort of differentiated additional licensing deals .
Speaker #11: And the stems from the fact that we've generated this really massive differentiated data sets that certainly there's value across applying in different immunology applications .
Speaker #11: solving And different immunology problems . So it's early days , but more to come as the year progresses . And excited and we're super enthusiastic in terms of where we are and where we're going .
Chad Robins: Yeah, and further, I think the Pfizer deal represented two types of different types of data deals. One is we're just kind of licensing data for AI modeling by pharma companies, and the second, where we're using our unique set of capabilities to do target discovery work. And so there's kind of multiple different types of kind of opportunities that can provide monetization from this really a unique data set.
Chad Robins: Yeah, and further, I think the Pfizer deal represented two types of different types of data deals. One is we're just kind of licensing data for AI modeling by pharma companies, and the second, where we're using our unique set of capabilities to do target discovery work. And so there's kind of multiple different types of kind of opportunities that can provide monetization from this really a unique data set.
Speaker #2: Yeah . And further , I think the Pfizer deal represented two types of different types of deals . data One is we're just kind of licensing data for AI modeling by pharma companies .
Speaker #2: second where using we're And the unique set of our capabilities to do target discovery work . And so there's kind multiple different types of of opportunities that can provide monetization from this .
[Analyst] (Craig-Hallum Capital Group): That, that's helpful. And maybe just as a follow-up, as you think of sort of, you know, how the data stands today, are there investments you need to make to sort of make it more accessible, potentially to pharma clients and others, and just to be able to sort of meet the kinds of demands you anticipate that they're having?
Bill Bonello: That, that's helpful. And maybe just as a follow-up, as you think of sort of, you know, how the data stands today, are there investments you need to make to sort of make it more accessible, potentially to pharma clients and others, and just to be able to sort of meet the kinds of demands you anticipate that they're having?
Speaker #2: Really a data set unique .
Speaker #10: That's helpful . And just as a maybe follow up , as of think you sort of , you know , how the data stands today are there .
Speaker #10: Investments you to need make to sort of make it more accessible , potentially to , to to pharma clients and , and others ?
Speaker #10: And and , just to to be able sort of meet the kinds of demands you anticipate that they're having .
Chad Robins: Yeah, Bill, the investments we're making are capped. Remember, there's revenue coming in from that business as well, which we consider a burn-off offset to the investments that we're making. So all the investments we need to, we believe, generate kind of this robust data set are captured in that kind of $15 to 20 million net burn of the investments that we're making this year.
Chad Robins: Yeah, Bill, the investments we're making are capped. Remember, there's revenue coming in from that business as well, which we consider a burn-off offset to the investments that we're making. So all the investments we need to, we believe, generate kind of this robust data set are captured in that kind of $15 to 20 million net burn of the investments that we're making this year.
Speaker #2: Yeah . Bill , the investments we're making are captured . Remember , there's revenue coming in from that business as which well , we consider a burn off offset to the investments that we're making .
Speaker #2: So all the need to , we believe , generate this kind of robust data set are captured in that kind of 15 to $20 million net burn of the investments that we're making this year .
[Analyst] (Craig-Hallum Capital Group): Okay, thanks. I was just thinking more probably in terms of, you know, timing of when a business like this could inflect, if it could.
Bill Bonello: Okay, thanks. I was just thinking more probably in terms of, you know, timing of when a business like this could inflect, if it could.
Speaker #10: Okay . Thanks . I just thinking more probably in terms of was timing of of when a this business like if inflect , could it if it could .
Chad Robins: ... Yeah, yeah, and we'll kind of come back at that point if there's kind of future investments to be made with a, you know, a business case on, you know, a high risk-adjusted return on the capital, you know, based on what we're doing. We will come back and kind of share what the plans are at that time. I'm just – I'm talking about for kind of the current path forward. We're looking at this as a kind of $50 to 20 million dollar net burn for the year for the business.
Chad Robins: ... Yeah, yeah, and we'll kind of come back at that point if there's kind of future investments to be made with a, you know, a business case on, you know, a high risk-adjusted return on the capital, you know, based on what we're doing. We will come back and kind of share what the plans are at that time. I'm just – I'm talking about for kind of the current path forward. We're looking at this as a kind of $50 to 20 million dollar net burn for the year for the business.
Speaker #2: Yeah . And we'll , we'll , we'll kind of come back at that there's kind of point if future investments being made with a , you know , a business case on , you know , a high risk adjusted return on the capital , you know , based on what we're doing , we will we will come back and kind of share what the plans are at that time .
Speaker #2: just I'm I'm about talking for the current We're looking at kind of 15 to $20 million net burn for the year for the business .
[Analyst] (Craig-Hallum Capital Group): Yep. Thank you very much.
Bill Bonello: Yep. Thank you very much.
Chad Robins: Yep.
Chad Robins: Yep.
Speaker #10: you very Yep . Thank much .
Speaker #2: Yep .
Operator: Thank you. I'm showing no further questions at this time. This concludes today's conference call. Thanks for participating, and you may now disconnect.
Operator: Thank you. I'm showing no further questions at this time. This concludes today's conference call. Thanks for participating, and you may now disconnect.
Speaker #3: I'm Thank you . showing no further questions at this time . This concludes today's conference call . Thanks for participating . And you may now disconnect .
