GeneDx Holdings Corp (WGS) 2023 Q4 法說會逐字稿

Thank you for standing by, and welcome to the GeneDx fourth quarter 2023 earnings conference.

感謝您的支持，歡迎參加 GeneDx 2023 年第四季財報會議。

(Operator Instructions) As a reminder, today's program is being recorded.

（操作員指示）提醒一下，今天的節目正在錄製中。

And now I'd like to introduce your host for today's program, Sabrina Dunbar, Chief of Staff.

現在我想介紹一下今天節目的主持人，參謀長薩布麗娜鄧巴 (Sabrina Dunbar)。

Please go ahead.

請繼續。

Thank you, operator, and thank you to everyone for joining us today.

謝謝運營商，也謝謝大家今天加入我們。

On the call, we have Katherine Stueland, President and Chief Executive Officer; and Kevin Feeley, Chief Financial Officer.

總裁兼執行長凱瑟琳·斯圖蘭 (Katherine Stueland) 出席了電話會議。和財務長凱文·菲利。

Earlier today, GeneDx released financial results for the fourth quarter ended December 31, 2023, and shared guidance for the full year 2024.

今天早些時候，GeneDx 發布了截至 2023 年 12 月 31 日的第四季度財務業績，並分享了 2024 年全年指引。

Before we begin, please take note of our cautionary statement.

在我們開始之前，請注意我們的警告聲明。

We may make forward-looking statements on today's call, including about our business plans, guidance, and outlook.

我們可能會在今天的電話會議上發表前瞻性聲明，包括我們的業務計劃、指導和前景。

Forward-looking statements inherently involve risks and uncertainties and only reflect our view as of today, February 20, and we are under no obligation to update.

前瞻性陳述本質上涉及風險和不確定性，僅反映我們截至今天 2 月 20 日的觀點，我們沒有義務更新。

When discussing our results, we refer to non-GAAP measures, which exclude certain items from reported results.

在討論我們的結果時，我們指的是非公認會計準則衡量標準，這些衡量標準從報告的結果中排除了某些項目。

Please refer to our fourth quarter 2023 earnings release and slides available at ir.genedx.com for definitions and reconciliations of non-GAAP measurements and additional information regarding our results, including a discussion of factors that could cause actual results to materially differ from forward-looking statements.

請參閱我們在ir.genedx.com 上提供的2023 年第四季度收益發布和幻燈片，以了解非GAAP 衡量標準的定義和調節以及有關我們結果的其他信息，包括對可能導致實際結果與前瞻性結果存在重大差異的因素的討論。尋找陳述。

And with that, I'll turn the call over to Katherine.

然後，我會將電話轉給凱瑟琳。

Thanks, Sabrina, and thank you all for joining us. 2023 was a pivotal year for us at GeneDx.

謝謝薩布麗娜，也謝謝大家加入我們。 2023 年對 GeneDx 來說是關鍵的一年。

We're on a stronger path forward and closer to our goal of reaching profitability in 2025.

我們正走在更堅實的道路上，更接近 2025 年實現獲利的目標。

Last year, we centered our entire team on three goals: one, increasing utilization of our industry-leading exome and genome; two, improving our average reimbursement rate; and three, dramatically reducing our cash burn.

去年，我們整個團隊將重點放在三個目標上：一是提高行業領先的外顯子組和基因組的使用率；二是提高平均報銷率；第三，大幅減少我們的現金消耗。

The combination of these three organizational goals ultimately ensures that our teams were focused on what's clinically best for patients and what's best for the financial health of the company.

這三個組織目標的結合最終確保我們的團隊專注於臨床上最適合患者的事情以及最有利於公司財務健康的事情。

And that focus paid off.

這種專注得到了回報。

Our teams worked with deep commitment in the fourth quarter and delivered $58 million of revenue, driven by more than 68% year-over-year growth in exome and genome test revenue, expanded our adjusted gross margins to 56% and ended the year ahead of our expected cash position, demonstrating a 51% year-over-year reduction in burn.

我們的團隊在第四季度全力投入，在外顯子組和基因組測試收入同比增長超過68% 的推動下，實現了5800 萬美元的收入，將調整後的毛利率擴大到56%，並提前結束了這一年。我們預期的現金狀況，顯示燒錢額比去年同期減少了 51%。

We're proud of our team's performance, and we're prepared to rinse and repeat that same level of commercial and operational execution.

我們為我們團隊的表現感到自豪，我們準備沖洗並重複相同程度的商業和營運執行。

As we look at 2024 and based on what we're seeing so far, you can continue to expect this level of focus on exome and genome revenue growth, gross margin expansion, and disciplined cash management.

展望 2024 年，根據我們迄今為止所看到的情況，您可以繼續期待對外顯子組和基因組收入成長、毛利率擴張和嚴格現金管理的關注。

The investments that we're making, whether it's in commercial, operations, medical affairs, or product and technology are directly tied to these goals.

我們所做的投資，無論是在商業、營運、醫療事務，或是產品和技術方面，都與這些目標直接相關。

In the fourth quarter, we realigned our sales strategy to focus on account profitability.

在第四季度，我們重新調整了銷售策略，將重點放在客戶獲利能力上。

We have right-sized our sales territories and further refined our commercial tactics and tools with account profitability in mind, and we're seeing good progress.

我們調整了銷售區域的規模，並進一步完善了我們的商業策略和工具，同時考慮到客戶獲利能力，我們看到了良好的進展。

Our strategy continues to include efforts that drive exome conversion with current customers, but we're taking a more precise yet high impact approach with new customer acquisition, mainly targeting pediatric neurologists.

我們的策略繼續包括推動現有客戶外顯子組轉換的努力，但我們正在採取更精確但影響更大的方法來獲取新客戶，主要針對兒科神經科醫生。

We continue to see better traction and faster growth ramps with these new ordering providers compared to lower productivity accounts, including general pediatrics.

與生產力較低的客戶（包括普通兒科）相比，我們繼續看到這些新的訂購提供者俱有更好的吸引力和更快的成長。

We're also keeping our operations team focused on the biggest levers for our P&L.

我們也讓我們的營運團隊專注於損益表的最大槓桿。

Reports out, billing operations, and COGS reduction, among other efforts to ensure we maintain our turnaround time.

報告、計費操作和降低銷貨成本等努力確保我們維持週轉時間。

Our product and tech team is working on our strategy to further scale our operations, improve our customer experience, open up access with the EMR integrations, automate our billing operations, and drive greater efficiency in every aspect of the business.

我們的產品和技術團隊正在製定策略，以進一步擴大我們的營運規模，改善我們的客戶體驗，開放 EMR 整合訪問，自動化我們的計費操作，並提高業務各個方面的效率。

The total addressable market in pediatrics is large, and while we are the dominant provider of whole-exome sequencing today, we've only penetrated about 3% of the total addressable market of $3 billion in the US-only pediatric setting.

兒科的總潛在市場很大，雖然我們是當今全外顯子定序的主要提供者，但我們僅滲透到美國兒科領域 30 億美元的總潛在市場的約 3%。

It's a market that we're developing in pediatric neurology where clinical evidence and health economics strongly support the transition to exome analysis.

這是我們正在兒科神經病學領域開發的市場，臨床證據和健康經濟學強烈支持向外顯子組分析的過渡。

We will also expand further into the general pediatric setting over the coming years as guidelines and payer policy continue to evolve to become more ready for commercial expansion and execution.

隨著指導方針和付款人政策的不斷發展，我們也將在未來幾年進一步擴展到一般兒科環境，為商業擴張和執行做更充分的準備。

On the other side of that is an entire $10 billion market in the US only for adult conditions that we'll be working to develop over the mid and long-term, and along the way, there's a growing data opportunity in rare disease drug development.

另一方面，美國有一個價值 100 億美元的市場，專門針對成人疾病，我們將在中長期內努力開發這個市場，並且在此過程中，罕見疾病藥物開發中存在越來越多的數據機會。

We've steadily added biopharma partners and have 20 active programs, mainly with biotech companies who are relying on us to find patients with a specific variant for clinical trial purposes.

我們穩步增加了生物製藥合作夥伴，並擁有 20 個活躍項目，主要是與生物技術公司合作，這些公司依靠我們尋找具有特定變異的患者以進行臨床試驗。

We're expecting that business to continue to grow at a similar pace.

我們預計該業務將繼續以類似的速度成長。

We think there's great promise in the role that diagnostics can plan rare disease drug development.

我們認為診斷在規劃罕見疾病藥物開發方面具有巨大的前景。

In fact, the New York Times recently highlighted a new gene therapy for children with hearing loss.

事實上，《紐約時報》最近強調了一種針對聽力損失兒童的新基因療法。

They featured an 11-year-old boy who had no ability to hear until researchers at the Children's Hospital of Philadelphia gave him an experimental gene therapy from our partner, Akouos and Eli Lilly Company.

他們的主角是一名 11 歲男孩，他一直沒有聽力，直到費城兒童醫院的研究人員為他提供了我們的合作夥伴 Akouos 和 Eli Lilly 公司提供的實驗性基因療法。

The boy was able to hear sound for the first time ever and now the company is expanding its research to several other centers.

這個男孩有史以來第一次聽到了聲音，現在該公司正在將研究擴展到其他幾個中心。

And just a few weeks ago, FDA Commissioner, Dr. Robert Califf said the agency will need to get creative about regulatory pathways, given the tsunami of rare disease and gene therapies that the FDA is anticipating.

就在幾週前，FDA 專員 Robert Califf 博士表示，鑑於 FDA 預計將出現罕見疾病和基因療法的海嘯，該機構需要在監管途徑上發揮創意。

Rare disease treatments are reliant upon rare disease diagnosis, and that's what we do best at GeneDx.

罕見疾病的治療依賴於罕見疾病的診斷，而這正是我們 GeneDx 所擅長的。

We believe this market is developing and are well-positioned to be the genetic testing partner of choice for these companies.

我們相信這個市場正在發展，並且有能力成為這些公司選擇的基因檢測合作夥伴。

Looking forward to 2024 guidance, we expect a similar growth trajectory as demonstrated quarter-over-quarter in 2023 as we continue to focus the teams on driving exome and genome utilization and improving our reimbursement rate.

展望 2024 年的指導，我們預計將出現與 2023 年季度環比相似的成長軌跡，因為我們將繼續將團隊重點放在推動外顯子組和基因組利用率並提高我們的報銷率上。

With that in mind, we expect to deliver between $220 million to $230 million in revenue this year, and Kevin will provide some additional commentary.

考慮到這一點，我們預計今年的收入將在 2.2 億至 2.3 億美元之間，凱文將提供一些額外的評論。

With a growing proportion of our test mix shifting to exome, we will continue to unlock greater gross margins, effectively converting more of the market to better volumes, and with the continued decrease in cash burn, we will end the year with strong operating leverage to put us on the precedence of profitability heading into 2025.

隨著我們越來越多的測試組合轉向外顯子組，我們將繼續釋放更高的毛利率，有效地將更多市場轉化為更好的銷量，並且隨著現金消耗的持續減少，我們將以強大的營運槓桿在年底實現讓我們在進入 2025 年之前就能夠實現盈利。

And with that, I'll hand the call over to Kevin.

這樣，我會將電話轉給凱文。

Thanks, Katherine.

謝謝，凱瑟琳。

Fourth quarter 2023 revenues from continuing operations grew to $58.1 million compared to $45.9 million in 2022 and $50.4 million in the third quarter.

2023 年第四季持續營運收入成長至 5,810 萬美元，而 2022 年為 4,590 萬美元，第三季為 5,040 萬美元。

That is an increase of 27% year-over-year and 15% sequentially, driven by exome.

在外顯子組的推動下，年增 27%，季增 15%。

Our team resulted over 15,600 whole-exome and genome tests in the fourth quarter, which generated revenues of over $39 million this quarter from the exome portfolio.

我們的團隊在第四季度進行了超過 15,600 次全外顯子組和基因組測試，本季從外顯子組組合中產生了超過 3,900 萬美元的收入。

That's an increase of 68% year-over-year and 15% sequentially.

年增 68%，季增 15%。

Adjusted gross margin from continuing operations was 56% in the fourth quarter of 2023, up from 41% a year ago and up from 48% in the third quarter.

2023 年第四季持續經營業務調整後毛利率為 56%，高於去年同期的 41%，高於第三季的 48%。

The margin expansion during the quarter is driven by favorable mix shift towards exome and continued cost per test leverage.

本季利潤率的擴張是由外顯子組的有利組合轉變以及每次測試槓桿的持續成本所推動的。

The fourth quarter did have certain non-recurring items, which positively impacted adjusted gross margin by approximately 400 basis points, so the underlying rate is 52% for the fourth quarter.

第四季確實有某些非經常性項目，這對調整後毛利率產生了約 400 個基點的正面影響，因此第四季的基本利率為 52%。

On mix, exome and genome represented 27% of all tests resulted in the fourth quarter of 2023, up from 16% a year ago and up from 23% in the third quarter.

綜合來看，外顯子組和基因組測試佔 2023 年第四季所有測試結果的 27%，高於一年前的 16% 和第三季的 23%。

The exome portfolio continues to operate north of 60% gross margin, which means the total gross margin will continue to benefit as exome picks up greater share of our overall test volume and replaces lower-margin products.

外顯子組產品組合的毛利率持續維持在60% 以上，這意味著隨著外顯子組在我們整體測試量中佔據更大份額並取代利潤率較低的產品，總毛利率將繼續受益。

On cost per test, the team is driving scalability and cost efficiency across both the wet and dry lab processes and while we are very pleased with where exome and genome costs are today, several initiatives are in our pipeline to further improve the cost base over time.

在每次測試的成本方面，該團隊正在推動濕法和乾法實驗室流程的可擴展性和成本效率，雖然我們對目前的外顯子組和基因組成本非常滿意，但我們正在採取多項舉措，以隨著時間的推移進一步改善成本基礎。

Automation and AI across clinical interpretation and analysis offer large untapped long-term opportunities ahead.

臨床解釋和分析領域的自動化和人工智慧為未來提供了大量尚未開發的長期機會。

Now, let's move down to operating expense.

現在，讓我們轉向營運費用。

Total adjusted operating expenses were $49.4 million for the fourth quarter of 2023.

2023 年第四季調整後營運支出總額為 4,940 萬美元。

That is a reduction of 46% year-over-year.

年減 46%。

We once again delivered reduced costs as we further separate from the legacy Sema4 business.

隨著我們進一步脫離傳統的 Sema4 業務，我們再次降低了成本。

Our team has a relentless focus on improving operating leverage and efficiency throughout the business, and that will continue into 2024.

我們的團隊不懈地致力於提高整個企業的營運槓桿和效率，並將持續到 2024 年。

And on the bottom-line, total company adjusted net loss for the fourth quarter of 2023 narrowed to $17.8 million, that is an improvement of 76% year-over-year and 16% sequentially from the third quarter.

從底線來看，2023 年第四季公司調整後淨虧損總額收窄至 1,780 萬美元，較去年同期改善 76%，較上季改善 16%。

Our fourth quarter net cash burn, excluding any financing proceeds, was $32.9 million, which improved 51% year-over-year and improved 22% from the third quarter.

我們第四季的淨現金消耗（不包括任何融資收益）為 3,290 萬美元，年增 51%，比第三季成長 22%。

The net cash burn this quarter included $5 million in scheduled payments under the 2022 legacy Sema4 payer settlement, $3 million to discharge operating payables for the exited reproductive health business, and $1 million in severance payments related to the previously announced cost reduction initiative.

本季的淨現金消耗包括根據2022 年遺留的Sema4 付款人和解協議支付的500 萬美元預定付款、用於清償已退出生殖健康業務的營運應付款項的300 萬美元，以及與先前宣布的成本削減計劃相關的100 萬美元遣散費。

Excluding these items, representative cash burn from continuing operations was $23.9 million in the fourth quarter, and we expect the net cash burn to continue to decrease as we couple high-margin growth with our cost reduction initiatives.

不包括這些項目，第四季持續經營業務的代表性現金消耗為 2,390 萬美元，隨著我們將高利潤成長與成本削減措施結合起來，我們預計淨現金消耗將繼續減少。

Cash, cash equivalents, marketable securities, and restricted cash was $131.1 million as of December 31, 2023.

截至 2023 年 12 月 31 日，現金、現金等價物、有價證券及限制性現金為 1.311 億美元。

And as a reminder, in October 2023, we announced that we entered into a five-year senior secured credit facility with Perceptive Advisors.

提醒一下，2023 年 10 月，我們宣布與 Perceptive Advisors 簽訂為期五年的優先擔保信貸額度。

The agreement provides for up to $75 million in capacity, consisting of an initial tranche of $50 million, which was drawn in October 2023 and an optional second tranche of $25 million, which is available to us through December 2024, subject to certain criteria.

該協議規定提供高達7500 萬美元的資金，其中包括2023 年10 月提取的第一筆5000 萬美元，以及可選的第二筆2500 萬美元，我們可以在2024 年12 月之前使用，但須符合某些標準。

And now turning to guidance for 2024.

現在轉向 2024 年指導。

We expect to deliver revenues between $220 million and $230 million for the full year 2024.

我們預計 2024 年全年營收將在 2.2 億至 2.3 億美元之間。

Historically, we see the first quarter as our seasonally weakest and the fourth quarter is our seasonally strongest in terms of both revenue and gross margin.

從歷史上看，我們認為第一季是我們季節性最弱的季度，第四季度是我們季節性最強的收入和毛利率。

We expect to continue to expand gross margin and land full year 2024 adjusted gross margins in excess of 50%.

我們預計毛利率將持續擴大，2024 年全年調整後毛利率將超過 50%。

For comparison, full year 2023 was 45%.

相比之下，2023 年全年為 45%。

We anticipate using $75 million to $85 million of net cash for full year 2024.

我們預計 2024 年將全年使用 7,500 萬至 8,500 萬美元的淨現金。

We've now delivered seven consecutive quarters of cash burn reduction since the acquisition of GeneDx and expect to drive quarterly sequential declines in cash burn throughout 2024.

自收購 GeneDx 以來，我們現已連續七個季度實現現金消耗減少，預計 2024 年現金消耗將按季度連續下降。

And finally, we once again reiterate our expectation to turn profitable in 2025.

最後，我們再次重申我們預計在 2025 年將實現盈利。

With that, I'll now turn it back to Katherine for any closing remarks.

現在，我將把它轉回凱瑟琳以供結束語。

Awesome.

驚人的。

Thanks, Kevin.

謝謝，凱文。

I'd like to acknowledge that on February 29, it is Rare Disease Day, and it serves as a reminder of why we do what we do.

我想承認，2 月 29 日是罕見疾病日，它提醒我們為什麼要做我們所做的事情。

Our overarching goal is to create a vibrant company that drives a new standard of care using genomics, ensures financial success and profitability, and create meaningful shareholder value.

我們的總體目標是創建一家充滿活力的公司，利用基因組學推動新的護理標準，確保財務成功和盈利能力，並創造有意義的股東價值。

Our team is fully committed to that.

我們的團隊完全致力於此。

I'd like to thank our employees for their deep dedication and passion to serve the providers and patients who put their trust in us.

我要感謝我們的員工的奉獻精神和熱情，為信任我們的醫療服務提供者和病人提供服務。

And I'd like to thank our shareholders who continue to support us as we transform GDX for growth, for scale, and for profitability, all in service of an ever-growing population of patients and partners who benefit from our work.

我要感謝我們的股東，他們在我們對GDX 進行轉型以實現成長、規模和盈利能力的過程中繼續支持我們，所有這些都是為了服務於不斷增長的從我們的工作中受益的患者和合作夥伴群體。

And with that, I'll turn the call over to the operator for Q&A.

然後，我會將電話轉給接線生進行問答。

(Operator Instructions)

（操作員說明）

Brandon Couillard, Jefferies.

布蘭登·庫亞爾，傑弗里斯。

Thanks, Good afternoon.

謝謝，下午好。

Katherine, the exome volume mix shift certainly played out in the fourth quarter.

凱瑟琳，外顯子組數量組合的變化肯定在第四季度發生了。

Do you think that 27% of volume is a good baseline off of which to think about for 2024?

您認為 27% 的交易量是 2024 年考慮的良好基準嗎？

How do you expect that to evolve as you move through the year?

隨著這一年的發展，您預計情況會如何發展？

And where do you think that could be exiting '24?

您認為 '24 會在哪裡退出？

Yeah, so I'll kick it off and let Kevin comment as well.

是的，所以我將開始並讓凱文發表評論。

We do think that's a good baseline.

我們確實認為這是一個很好的基線。

I think looking back to where we were a year ago, we are really, really focused on continuing that exome conversion.

我認為回顧一年前的情況，我們真的非常專注於繼續外顯子組轉換。

And I think in the fourth quarter, we really started to see even stronger salesforce performance on that.

我認為在第四季度，我們確實開始看到更強勁的銷售人員表現。

And so we're building off of that momentum moving forward and really continuing to drive continued conversion.

因此，我們正在利用這一勢頭繼續前進，並真正繼續推動持續的轉換。

Again, it's part of the reason why we're focusing our efforts with pediatric neurologists.

這也是我們將精力集中在兒科神經科醫師身上的部分原因。

That segment, from a customer perspective, is just primed to be able to convert faster.

從客戶的角度來看，該細分市場已經準備好能夠更快地進行轉換。

So, we feel confident we'll continue to expand that throughout the course of the year.

因此，我們有信心在今年繼續擴大這一範圍。

(multiple speakers) Sorry, go ahead, Kevin.

（多位發言者）抱歉，請繼續，凱文。

No, go ahead.

沒有，繼續。

I was saying I have nothing to add to that, so fire away.

我是說我沒有什麼好補充的，所以開火吧。

Okay.

好的。

Kevin, you talked about realigning the salesforce in the fourth quarter to target more profitable accounts.

凱文，您談到了在第四季度重新調整銷售隊伍，以瞄準利潤更高的客戶。

Can you just unpack how you go about that, how you have intel in terms of profitability by account, and should we expect any other salesforce tweaking?

您能否簡單地解釋一下您是如何做到這一點的，您如何掌握按帳戶盈利能力方面的情報，以及我們是否應該期待任何其他銷售人員的調整？

Do you expect to add headcount capacity in 2024 outlook for the commercial organization?

您預計 2024 年商業組織的員工人數會增加嗎？

Yes.

是的。

What were your outlook for the commercial organization?

您對商業組織的前景如何？

Yeah, so what we did was we took a look at where there is volume, and we took a look at where there is favorable payer policy and where there's unfavorable payer policy.

是的，所以我們所做的就是查看哪裡有交易量，哪裡有有利的付款人政策，哪裡有不利的付款人政策。

So those were the main factors that we took a look at in terms of being able to really better define account profitability.

因此，這些是我們為了能夠更好地定義帳戶獲利能力而考慮的主要因素。

And as we put that lens on it, it was super clear that there were just some territories that they're not going to be productive or profitable in the near-term and therefore not worthy of a dedicated sales rep.

當我們把這個鏡頭放在上面時，很明顯，只有一些地區在短期內不會產生生產力或盈利，因此不值得專門的銷售代表。

So we actually scaled back some of the territories.

所以我們實際上縮減了一些領土。

Of course, where there may be an account that's an outlier in some of these lower profitability segments, we have a rep who's able to extend and be able to ensure that we're maximizing that.

當然，如果某個帳戶在某些盈利能力較低的細分市場中屬於異常值，我們就有一名代表能夠擴展並確保我們能夠最大限度地提高這一點。

But we're happy with where we landed in terms of $3.5 million of revenue per rep for 2023.

但我們對 2023 年每位銷售代表的收入達到 350 萬美元感到滿意。

That was an improvement over the prior year.

這比前一年有所改善。

And with the new territory cuts, we feel really confident that we're going to be able to grow at that same rate that we saw last year with the team that we have.

隨著新的領土削減，我們非常有信心我們的團隊能夠以去年看到的相同速度成長。

We also are really taking a look at the inpatient setting to ensure that we can continue to drive utilization.

我們也真正關注住院環境，以確保我們能夠繼續提高使用率。

It's a really small segment of revenue today, but it's really healthy revenue for us and then it's institutional-like.

如今，這只是收入的一小部分，但對我們來說確實是健康的收入，而且是機構性的。

So, we're not having the noise that you see from commercial payers.

因此，我們沒有聽到商業付款人發出的噪音。

And that's mainly with rapid full genome sequencing.

這主要是透過快速全基因組定序。

So we've got a small and targeted team to really drive enterprise sales in patient setting.

因此，我們擁有一支小型且有針對性的團隊，可以真正推動患者環境中的企業銷售。

So I don't expect that we're going to have any major sales force expansion this year. but where we can be opportunistic as we start to see additional progress with the team, we may add in that enterprise team that we'll see.

因此，我預計今年我們不會有任何重大的銷售團隊擴張。但是，當我們開始看到團隊取得額外進展時，我們可以投機取巧，我們可能會添加我們將看到的企業團隊。

It's a longer sales cycle.

銷售週期較長。

That's helpful.

這很有幫助。

Last one for Kevin.

最後一張給凱文。

Could you unpack the 400 basis point gross margin benefit in the fourth quarter, what that was attributable to?

您能否解釋一下第四季度毛利率提高 400 個基點的原因是什麼？

And then, how much of the cash burn -- I think you said $75 million to $85 million for the year.

然後，燒掉多少現金——我想你說的是今年 7500 萬到 8500 萬美元。

What's incorporated in that for legacy restructuring, some of outlays, what have you?

遺產重組包含了什麼，一些支出，你有什麼？

Yeah.

是的。

So the fourth quarter, the benefits included the reversal of certain bonus and other incentive accruals that we had built up throughout the year and determined would not be payable.

因此，第四季度的福利包括沖銷我們全年累積並確定不會支付的某些獎金和其他應計獎勵。

Some of those ran through COGS, and we received some favorable reimbursement on our stop-loss insurance.

其中一些是透過銷貨成本進行的，我們的止損保險獲得了一些有利的報銷。

Frankly, earlier in the year, we had some very high extraordinary claims that went through expense related to COGS, and we saw some relief in the fourth quarter that came through.

坦白說，今年早些時候，我們有一些非常高的特別索賠，這些索賠涉及與銷貨成本相關的費用，我們在第四季度看到了一些緩解。

So when you adjust out those benefits, I think it's fair to say the operating run rate was about 52% in the fourth quarter, which, frankly, we're very pleased with.

因此，當你調整這些效益時，我認為可以公平地說，第四季度的營運率約為 52%，坦白說，我們對此感到非常滿意。

And then on the full-year guide for cash burn, as a reminder, December of 2024, we will have a scheduled payment the next scheduled payment on the 2022 settlements between Sema4 and one of its payers.

然後，在全年現金消耗指南中，提醒一下，2024 年 12 月，我們將在 Sema4 與其付款人之一之間的 2022 年和解金的下一次預定付款中進行預定付款。

So that number is burned by that next scheduled payment.

因此，該數字將被下一次預定的付款所消耗。

And then anywhere from $2 million to $5 million of other payments to put the entirety of legacy Sema4 to bed.

然後支付 200 萬到 500 萬美元的其他款項，將整個遺留的 Sema4 投入使用。

If you look at the Q4 cash burn, excluding the settlement payment that we made in December of '24 and severance and some old payables as Sema4, Q4 was $23.9 million.

如果你看一下第四季的現金消耗，不包括我們在 2024 年 12 月支付的和解付款、遣散費以及 Sema4 等一些舊應付帳款，第四季度的現金消耗為 2390 萬美元。

I think that's more representative of what's our run rate today.

我認為這更能代表我們今天的運行率。

And we have every confidence that as the business grows and in particular, with high-margin exome business, we'll continue to expand gross profit, and we continue to drive down operating expense.

我們完全有信心，隨著業務的成長，特別是高利潤的外顯子組業務，我們將繼續擴大毛利，並繼續降低營運費用。

So you should expect us to see a reduction in cash burn with each sequential quarter in 2024.

因此，您應該預期 2024 年每季的現金消耗都會減少。

Thank you.

謝謝。

Matt Sykes, Goldman Sachs.

馬特·賽克斯，高盛。

Hey, guys.

大家好。

This is Prashant on for Matt.

這是普拉尚特（Prashant）為馬特（Matt）所做的。

Just with the key competitor in rare disease off the market, do you anticipate being able to capture some of the market share?

隨著罕見疾病領域的主要競爭對手退出市場，您是否預期能夠佔據一些市場份額？

And if so, what's your strategy to try and capture some of those share gains?

如果是這樣，您嘗試獲取部分份額收益的策略是什麼？

Yeah.

是的。

It's a fantastic question.

這是一個很棒的問題。

We absolutely feel confident in our ability to be able to step in and provide our services to -- to that market.

我們對進入該市場並提供服務的能力充滿信心。

I think in particular, a lot of the focus that we saw with some of the rare disease testing was exactly in the market that we're aiming to drive greater utilization of exome in, which is the pediatric neurology setting.

我特別認為，我們在一些罕見疾病測試中看到的許多關注點正是在市場上，我們的目標是推動外顯子組的更大利用，即兒科神經病學環境。

And so we're grateful for the efforts of others, who have really gotten pediatric neurologists to start ordering genetic testing.

因此，我們感謝其他人的努力，他們確實讓兒科神經科醫生開始訂購基因檢測。

Historically, they hadn't.

從歷史上看，他們沒有。

So we now have customers who understand how to order testing, which patients should utilize it.

因此，我們現在擁有了解如何訂購檢測以及哪些患者應該使用檢測的客戶。

And we have a growing body of evidence, including data that we presented at the American Epilepsy Society last fall, that shows that exome is going to drive a higher diagnostic yield than panels.

我們有越來越多的證據，包括我們去年秋天在美國癲癇協會上提交的數據，這些數據表明外顯子組將比面板帶來更高的診斷率。

So these are customers who we have been converting already.

這些是我們已經轉換的客戶。

We have a proven ability to convert them from panels to exome, and we'll continue to drive, I think, our market brand to those clinicians and be able to convert the business throughout the course of the year.

我們已經證明有能力將它們從面板轉換為外顯子組，我認為我們將繼續向這些臨床醫生推動我們的市場品牌，並能夠在全年中實現業務轉換。

All of that really would be upside in terms of our outlook for 2024.

就我們 2024 年的前景而言，所有這些確實都是有利的。

Got it.

知道了。

Thank you.

謝謝。

That's helpful.

這很有幫助。

And then what is the current split between NovaSeq 6000 and Xs that you have?

那麼目前您擁有的 NovaSeq 6000 和 Xs 之間的差距是多少？

And how large of an impact will that transition have on COGS?

這項轉變將對銷貨成本產生多大影響？

And how long will it take to start realizing cost savings, given the upfront cost of replacing machines?

考慮到更換機器的前期成本，需要多長時間才能開始實現成本節約？

Yeah, the Xs represent -- the new machine, the X represents about 20% of our fleet.

是的，X 代表新機器，X 代表我們機隊的大約 20%。

It will take us through the end of the year based on our scheduled deliveries to replace the entirety of that fleet.

根據我們預定的交付量，我們將在今年年底前更換整個機隊。

We've got two machines live with the second only going live in November.

我們有兩台機器正在運行，第二台機器要到 11 月才會運行。

And so there's not yet a full quarter effect on the benefit to COGS for that second machine.

因此，第二台機器的銷貨成本效益尚未受到整個季度的影響。

We're seeing good experience.

我們看到了很好的經驗。

And I'd say, more importantly, the larger flow cell that has come out, we launched subsequent to the end of the year.

我想說，更重要的是，我們在今年底推出了更大的流通池。

So in February, that went live.

所以在二月份，它就上線了。

And so really won't start to make an impact on COGS until the second quarter, at least from a full quarter perspective.

因此，直到第二季才會真正開始對銷貨成本產生影響，至少從整個季度的角度來看。

So we've got two machines live and intend to replace the remaining or the fleet over the next year or so.

因此，我們有兩台機器正在運行，並打算在未來一年左右更換剩餘的機器或機隊。

The benefits, I'd say, more importantly, will start to be seen once we are producing at scale with all of those machines and with that larger flow sale in place, which, again, just went live for us in February here.

我想說，更重要的是，一旦我們使用所有這些機器進行大規模生產並進行更大的流量銷售，這些好處就會開始顯現出來，這再次是我們在二月在這裡上線的。

So, still to come.

所以，還是來吧。

Got it.

知道了。

And then just a last quick question on what's the process of retiring a panel?

最後一個簡單的問題是，淘汰專家小組的流程是什麼？

Could you just elucidate that?

你能解釋一下嗎？

And how long does it take?

需要多長時間？

Certainly.

當然。

I mean, first, what we've done is establish a set of criteria for determining whether or not we should be keeping a panel.

我的意思是，首先，我們所做的是建立一套標準來確定我們是否應該保留一個小組。

And it starts with what's best for patients.

它始於對患者最有利的事。

And then there's a number of factors that we take a look at to really assess whether or not the gross margins are there.

然後我們會考慮許多因素來真正評估毛利率是否存在。

It's the type of panel where it's actually primed for conversion to exome, and we should just be driving exome first versus clinicians who may be used to ordering via a panel.

這是一種實際上準備好轉化為外顯子組的面板類型，我們應該首先驅動外顯子組，而不是可能習慣透過面板訂購的臨床醫生。

And so we established this rubric.

所以我們建立了這個標題。

We identified about 350 tests that we determined we could retire.

我們確定了大約 350 個可以退役的測試。

We did retire them earlier this month.

我們本月早些時候確實讓他們退休了。

And that will be a process that we continue to utilize as we drive more and more utilization of exome and genome it represented, I would say, a small portion of utilization.

這將是我們繼續利用的一個過程，因為我們推動越來越多的外顯子組和基因組的利用，我想說，它代表了利用的一小部分。

So, it really was maintenance for us to be able to keep those up and running.

因此，對我們來說，保持這些設備正常運作確實是一項維護工作。

So once we've made that determination, it usually takes several months just to be able to put the product and tech teams in place to ensure that we're communicating with customers, ensure that we have a good strategy for ensuring that there isn't a discontinuation of care and that we can have a warm transfer to whatever that new test is, if it's a new panel or if it's an exome or genome.

因此，一旦我們做出了決定，通常需要幾個月的時間才能將產品和技術團隊部署到位，以確保我們與客戶溝通，確保我們有一個良好的策略來確保沒有「停止護理，我們可以熱情地轉移到任何新的測試，無論它是一個新的組合還是外顯子組或基因組。

It's something we intend to continue to drive and feel like we're developing a strength with that being a muscle organizationally.

這是我們打算繼續推動的事情，感覺我們正在發展一種力量，成為組織上的一塊肌肉。

Daniel Brennan, Cowen.

丹尼爾·布倫南，考恩。

Great.

偉大的。

Thanks for the questions.

感謝您的提問。

Congrats on the quarter.

恭喜本季。

Maybe first one would be, I think, maybe Brandon, I think asked on the first question.

我想，也許第一個可能是布蘭登，我想是在第一個問題上被問到的。

You exited the year in the fourth quarter, I think 27% mix as you commented on exome/genome.

你在第四季度結束了這一年，當你評論外顯子組/基因組時，我認為 27% 是混合的。

So, I believe you said that is a reasonable point for all of 2024.

所以，我相信您所說的話對於 2024 年全年來說都是合理的。

I'm just wondering why that wouldn't continue to move higher?

我只是想知道為什麼它不會繼續走高？

We'll continue.

我們會繼續。

It's a good starting point, Dan, and thank you for for the clarifying question.

丹，這是一個很好的起點，感謝您澄清問題。

We think it's a good starting point.

我們認為這是一個很好的起點。

We intend to continue to increase that mix percentage throughout the course of the year.

我們打算在今年繼續提高這個混合比例。

Yeah.

是的。

Dan, to be clear, we think it's the right exit point.

丹，需要明確的是，我們認為這是正確的退出點。

But absolutely, with each sequential quarter, we should expect to pick up some mix there towards exome and genome for the each passing quarter throughout the year.

但絕對地，在每個連續季度中，我們應該期望在全年每個季度中獲得一些外顯子組和基因組的組合。

Is there like a level -- I mean, we can play with the math?

有沒有一個等級——我的意思是，我們可以玩數學遊戲？

Is there a level that it's an exit year at 30%, 35%?

是否存在 30%、35% 的退出年份？

Or is it up to us to back into that?

或者我們應該回到那個狀態嗎？

Yeah.

是的。

I think the way we've always viewed it as in order to reach profitability, we've said that that rate needs to get closer to 40% of all tests being exome and genome, and we're anticipating that point of breakeven early 2025.

我認為，按照我們一直以來的看法，為了實現盈利，我們說過，外顯子組和基因組測試的比例需要接近 40%，我們預計 2025 年初將達到盈虧平衡點。

And so I think something in the mid-30s by the end of this year to exit the fourth quarter is likely the right landing spot, and we'll evolve towards that with each passing quarter of 2024.

因此，我認為，到今年年底 30 多歲左右退出第四季度可能是正確的著陸點，我們將在 2024 年的每個季度朝著這個方向發展。

Great.

偉大的。

Thanks for that.

感謝那。

That's helpful.

這很有幫助。

And then I think the guide, right, is for greater than 50% or plus gross margin, so the 4Q underlying was 52%.

然後我認為正確的指南是大於 50% 或加上毛利率，因此第四季的基礎值為 52%。

Is there a reason if mix is going up, is there a reason why the fourth quarter, 52% shouldn't be like the floor for 2024?

如果混合比例上升，有什麼理由嗎？第四季 52% 不應該像 2024 年的下限一樣有什麼原因嗎？

Or is there something else going on with the mix shift that could drag gross margins down?

或者，混合轉變中是否還有其他因素可能會拖累毛利率下降？

No.

不。

Look, overall, the comparison is 45% for full year 2023.

整體來看，2023 年全年的對比為 45%。

I think we just want to see a little bit more data come through before we rely on Q4.

我認為我們只是想在依賴第四季之前看到更多的數據。

Historically, Q4 seasonally has been our strongest, both in terms of revenue reimbursement and therefore, gross margin.

從歷史上看，無論是在收入報銷方面還是在毛利率方面，第四季度都是我們最強勁的季度。

And so we want to see a little more data come through before we call Q4 in ongoing trends.

因此，在我們將第四季度稱為持續趨勢之前，我們希望看到更多的數據。

Certainly, we're optimistic that there is more room to improve average reimbursement rates and further conviction that we can continue to drive down COGS.

當然，我們樂觀地認為平均報銷率還有更大的提升空間，並進一步堅信我們可以繼續降低銷貨成本。

And with each percentage point, we pick up in overall test mix, it should benefit because the exome portfolio continues to operate mid-60% gross margin, but we just want to see a little bit more data come through before we call Q4 the new normal, if you will.

隨著每個百分點，我們在整體測試組合中取得進步，它應該會受益，因為外顯子組投資組合的毛利率繼續保持在60% 左右，但我們只是希望在我們將第四季度稱為新季度之前看到更多的數據。正常，如果你願意的話。

But extremely confident we'll end the balance of the full year at 50% or higher.

但我們非常有信心將全年餘額保持在 50% 或更高。

Got it.

知道了。

And then maybe the final one, just biomarker bills, like, is there -- just how could those impact you to the extent these 15 states -- you begin to see payment rates and there's another, I think, fix states behind it.

然後也許是最後一個，只是生物標記法案，就像，這些法案如何影響你到這 15 個州的程度 - 你開始看到付款率，我認為，還有另一個，修復其背後的州。

Just is it -- are you already getting paid pretty universally.

就是這樣——你已經普遍得到報酬了嗎？

Just any color on the level of test today in those 15 states to the extent you were to see commercial coverage go up to 100%?

今天在這 15 個州進行的測試水準上的任何顏色都可以達到商業覆蓋率達到 100% 的程度嗎？

What kind of impact could that have?

這會產生什麼樣的影響？

Thank you.

謝謝。

Yeah, there's no doubt, Dan, that any improvement in underlying policy coverage is a net positive for us to the extent payers or state systems pick up exome and genome coverage.

是的，毫無疑問，丹，只要付款人或國家系統獲得外顯子組和基因組覆蓋率，基礎政策覆蓋率的任何改善對我們來說都是淨積極的。

That should be a net positive to us, we expect it to be a net positive to us.

這對我們來說應該是一個淨積極因素，我們希望它對我們來說是一個淨積極因素。

At the same time, we want to make sure we're not getting ahead of ourselves.

同時，我們希望確保我們不會超前。

So it's a long way between enacting a biomarker bill or putting in place a positive coverage decision and getting paid.

因此，從頒布生物標記法案或做出積極的承保決定到獲得報酬之間還有很長的路要走。

And so we want to make sure we have the operational experience and more so can see it translate into actual cash collections before we start to rely on improved reimbursement.

因此，我們希望確保我們擁有營運經驗，更重要的是可以在我們開始依賴改進的報銷之前將其轉化為實際的現金收款。

But recent momentum with respect to policy and in particular, these biomarker bills it's a great thing for patients.

但最近政策方面的勢頭，特別是這些生物標記物表明，這對患者來說是一件好事。

We believe ultimately and should be great for our business.

我們相信最終並且應該對我們的業務有利。

Our expectations are built into the guide, and we'll learn more for the year once there's more clarity on how some of these will be enacted in practice.

我們的期望已納入指南中，一旦對其中一些內容如何在實踐中實施更加明確，我們將在今年了解更多資訊。

Terrific.

了不起。

Thank you.

謝謝。

Mark Massaro, BTIG.

馬克·馬薩羅，BTIG。

Hey, guys.

大家好。

This is Vidyun for Mark.

這是 Mark 的 Vidyun。

Thanks for taking the question.

感謝您提出問題。

So I think you've walked through in some detail what you're expecting for 2024 in terms of exome conversion.

所以我認為您已經詳細了解了 2024 年外顯子組轉換的預期。

Aside from that, it sounds like you might be expecting a somewhat back half way the year.

除此之外，聽起來你可能會預期今年下半年會有所回落。

I think you've also highlighted picking up that competitor business' upside, just.

我認為您也強調了要抓住競爭對手業務的優勢。

Maybe just walk us through any other puts and takes to discuss for the 2024 guidance?

也許只是引導我們討論 2024 年指導的任何其他看跌期權？

Thanks.

謝謝。

Yeah, I'll start.

是的，我要開始了。

I'd say, Vidyun, the low end of the guide represents about 13% year-over-year growth.

我想說，Vidyun，指南的低端代表了約 13% 的同比增長。

That's consistent with what we just delivered.

這與我們剛剛交付的內容一致。

And we want to acknowledge that exome and genomes are still relatively new technologies for some physicians.

我們要承認，外顯子組和基因組對一些醫生來說仍然是相對較新的技術。

We're expanding markets, that takes time, and we've learned some lessons from 2023, and we don't want to get over our skis with respect to the expectation on the rate of change to exome beyond what we can clearly see in our data.

我們正在擴大市場，這需要時間，我們從 2023 年吸取了一些教訓，我們不想超出我們對外顯子組變化率的預期，超出我們可以清楚地看到的範圍。我們的數據。

And I'll just remind you that offsetting exome growth is roughly 30%, or $60 million of full year revenue today, comes from non-exome tests.

我只想提醒您，抵消外顯子組成長的大約 30%，即今天全年收入的 6000 萬美元，來自非外顯子組測試。

And so as these non-exome tests, which, as you know, were relatively low gross margin, non-core to our strategy, they will be running off in some fashion.

因此，如你所知，這些非外顯子組測驗的毛利率相對較低，不是我們策略的核心，它們將以某種方式消失。

And so we expect to see some declines in volumes and revenue from non-exome tests, offsetting volume growth.

因此，我們預期非外顯子組測試的數量和收入會下降，抵消數量的成長。

And so try to ensure that we acknowledge that in the guide that we provided.

因此，請盡量確保我們在提供的指南中承認這一點。

Yeah.

是的。

And just to add a little bit of color.

只是添加一點顏色。

I think our original guide from 2023 was heavily back half of the year weighted.

我認為我們最初的 2023 年指南主要側重於今年下半年的情況。

And what we are anticipating this year is kind of the steady growth.

我們今年的預期是穩定成長。

We really want modeling similar to what we saw in terms of actuals in 2023.

我們確實希望模型與 2023 年的實際情況類似。

As Kevin said earlier, I think seasonally, our strongest quarters are usually Q2 and Q4.

正如凱文之前所說，我認為從季節性來看，我們最強的季度通常是第二季和第四季。

But it's -- I would say, continued steady growth throughout the course of the year.

但我想說的是，全年持續穩定成長。

Okay.

好的。

Perfect.

完美的。

Thanks so much.

非常感謝。

And then just a quick follow-up.

然後進行快速跟進。

Kevin, maybe you can dig into EMR integration a little bit, just how you're thinking about potential upsides in that opportunity.

Kevin，也許您可以深入研究 EMR 集成，看看您如何看待該機會的潛在優勢。

It also sounds like you guys have consolidated the menu a little bit.

聽起來你們還整合了菜單一點。

Just how should we be thinking about that?

我們該如何思考這個問題呢？

Yeah.

是的。

So starting with EMR, I would say, it's something that we do routinely, and we will continue to focus on that to open up access.

因此，我想說，從 EMR 開始，這是我們的日常工作，我們將繼續關注這一點以開放存取。

So I put that in as kind of table stakes in terms of how we operate, how we make it easier to work with us, how we continue to smooth out the customer experience.

因此，我將其作為我們如何運作、如何使與我們合作更容易以及我們如何繼續平滑客戶體驗的賭注。

So that is something that we'll continue to invest in because it honestly pays for itself.

所以這是我們將繼續投資的事情，因為它確實能收回成本。

And in terms of test retirement, we're really pleased.

就測試退休而言，我們真的很高興。

As I mentioned earlier, that we were able to retire the 350 or so tests.

正如我之前提到的，我們能夠取消大約 350 項測試。

And we feel like we have a healthy test menu and a very focused sales team and operations team that's going to continue to drive the conversion to exome and genome.

我們覺得我們擁有一個健康的測試菜單以及一個非常專注的銷售團隊和營運團隊，將繼續推動向外顯子組和基因組的轉換。

And as we keep making progress with that, we'll continue to, I think, have a healthy approach to reviewing that test menu to retiring tests over time.

隨著我們在這方面不斷取得進展，我認為我們將繼續採用健康的方法來審查測試菜單，以便隨著時間的推移淘汰測試。

We want to make sure that we can continue on the steady growth rate.

我們希望確保我們能夠繼續保持穩定的成長速度。

We feel like we're in a position of strength in terms of the overall commercial strategy.

我們覺得我們在整體商業策略方面處於優勢地位。

And how that links up to our operations team.

以及如何與我們的營運團隊聯繫。

There's a really beautiful handoff that we're seeing between those two teams that keeps everyone really focused on near-term execution.

我們看到這兩個團隊之間的交接非常漂亮，讓每個人都真正專注於近期執行。

So we feel like we're in a great place in terms of getting volume in the door, get it reports out and continuing to get good volume, continue to focus on that account profitability, and drive us forward towards profitability in 2025.

因此，我們覺得我們在增加銷售量、發布報告並繼續獲得良好的銷售量、繼續關注客戶盈利能力以及推動我們在 2025 年實現盈利方面處於有利位置。

Awesome.

驚人的。

Thanks for taking the questions.

感謝您提出問題。

Thank you.

謝謝。

This does conclude the question and answer session of today's program.

今天節目的問答環節到此結束。

I'd like to hand the program back to Katherine Stueland for any further remarks.

我想將程序交還給凱瑟琳·斯圖蘭以供進一步評論。

Awesome.

驚人的。

Thank you so much, Jonathan, and thank you to everyone for joining us.

非常感謝你，喬納森，也感謝大家加入我們。

We're excited about 2024, and we'll be at upcoming conferences in the coming weeks and look forward to seeing you all then.

我們對 2024 年感到興奮，我們將參加未來幾週即將舉行的會議，期待屆時見到大家。

Thanks so much.

非常感謝。

Thank you, ladies and gentlemen, for your participation in today's conference.

女士們、先生們，感謝你們參加今天的會議。

This does conclude the program.

這確實結束了該程式。

You may now disconnect.

您現在可以斷開連線。

Good day.

再會。