Release Date: May 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Personalis Inc (PSNL, Financial) achieved a revenue of $19.5 million in Q1 2024, surpassing the upper end of their guidance.
- Biopharma business grew by 55% compared to Q1 2023, driven by strong demand for core immunoassay platform and MRD product mix.
- Personalis Inc (PSNL) has increased its full-year revenue guidance to $76 million to $78 million, up from $73 million to $75 million.
- The company has successfully launched its ultrasensitive MRD test, NeXT Personal, with significant early adoption and positive feedback from physicians.
- Personalis Inc (PSNL) has established strong partnerships, including a key collaboration with Tempus to commercialize NeXT Personal, potentially worth $30 million.
Negative Points
- Despite revenue growth, gross margin decreased to 20.1% in Q1 2024 from 25.1% in the same period last year.
- The company reported a net loss of $13 million for Q1 2024, although this was an improvement from a $28.7 million loss in the previous year.
- Operating expenses, while reduced from the previous year, remain high at $24.4 million for Q1 2024.
- The company is engaged in ongoing litigation with Foresight Diagnostics to protect its intellectual property, indicating potential legal risks.
- Personalis Inc (PSNL) is cautious about expanding its early access program for NeXT Personal due to the current lack of reimbursement, which could limit short-term growth.
Q & A Highlights
Q: Can you discuss your strategy for adhering to the FDA's final LDT regulation and its implications for Personalis?
A: (Christopher Hall - President, CEO) We view the FDA's final guidance as positive, aligning well with our robust quality management system. Both NeXT Dx and NeXT Personal are laboratory-developed tests and are on the market as of the effective date of the FDA guidance, which we see as beneficial. We also anticipate New York approval for both tests, positioning us well within the regulatory framework.
Q: Following the recent AdCom meeting on MRD as an endpoint in multiple myeloma trials, how is NeXT Personal positioned for capturing clinical trial opportunities in solid tumors?
A: (Christopher Hall - President, CEO) The FDA's unanimous approval for using MRD in blood-based multiple myeloma trials is expected to extend to solid tumors. Our ultra-sensitive MRD test, NeXT Personal, is well-positioned due to its ability to detect cancer recurrence at very low levels, which is crucial for biopharma companies in clinical trials.
Q: With the raised guidance for 2024, can you specify areas of expected strength or softness in your product lines?
A: (Aaron Tachibana - CFO, COO) The guidance increase is primarily due to strong biopharma demand, especially from our immunoassay platform and NeXT Personal. We anticipate significant growth from NeXT Personal as we progress through 2024, supported by a robust pipeline and increasing interest in our personalized cancer vaccine offerings.
Q: Can you provide an update on the adoption and ramp-up of the 338 NeXT Personal tests and the expected timeline for reimbursement?
A: (Christopher Hall - President, CEO) We aim to submit for reimbursement across three cancer indications in 2024. The adoption of NeXT Personal is growing, and we plan to expand the number of physicians in our Early Access Program, both independently and with Tempus, as we approach reimbursement approval.
Q: Regarding the increase in pharma demand, is this primarily from new or existing customers?
A: (Aaron Tachibana - CFO, COO) The increased demand is mainly from existing customers who are expanding their use of our services, particularly those involved in personalized cancer vaccine development. The relationship with Moderna has also contributed to this growth.
Q: What are the expectations for the early access program for NeXT Personal, and how does it relate to NeXT Dx?
A: (Christopher Hall - President, CEO) The early access program for NeXT Personal is seeing strong demand, and we are managing growth carefully due to reimbursement considerations. NeXT Dx is being used alongside NeXT Personal by many physicians, which enhances the utility and adoption of both tests.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
