Natera Inc at Canaccord Genuity Growth Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Kyle Mikson - Canaccord Genuity - Analyst : So Mike, maybe first just go through the second-quarter results, Big B, raise guidance, really good results of volume ASP. Just walk through those.

Question: Kyle Mikson - Canaccord Genuity - Analyst : So a lot of -- I'm not sure if like the revenue beat based on the true-up, but definitely, like the gross margin beat or outperformance. So maybe it's not worth diving into for too long. I would like to just talk, like walk through that a little bit and why those occur, what those really are, which side of the curves on, and why you can't really perceive that to predict that or --

Question: Kyle Mikson - Canaccord Genuity - Analyst : On the guide though -- like ASP, seems like you're now -- you're thinking about like increases rather than -- maybe modest increases, but rather than (inaudible) which was more stable ASPs. And that was both the woman's health as well as oncology and Signatera. I mean, is that true? Like, what's the thesis behind that philosophy?

Question: Kyle Mikson - Canaccord Genuity - Analyst : Okay. And the recurring and higher margin side of Signatera testing in the a surveillance setting. Obviously, you guys obviously offer test in the adjuvant window as well as a surveillance setting. But how does your mix shake out today? It seems like it's more even. But when does that flip to be the majority in the surveillance?

Question: Kyle Mikson - Canaccord Genuity - Analyst : Okay. And then in the past, I think you were talking about how Signatera gross margins could be look in line with the company (inaudible) at this point, it seems like that's probably be happening. What -- to get to like the 60%-plus, 70% margins for Signatera as like a segment, basically, (inaudible) to that pretty high mix of surveillance in testing?

Question: Kyle Mikson - Canaccord Genuity - Analyst : And then in terms of like sequential growth or even like annual growth in volume for Signatera, is that -- I mean, how do you think about that? Like what's driving that? Is that new ordering physicians? Because now I think it's like 40% or so penetrated in the country? Or is that test per doc in like the recurring?

Question: Kyle Mikson - Canaccord Genuity - Analyst : And then maybe just a quick update on the commercial payer progress, like [us and super] announced in the past, and then also the biomarker bill impact, if there's anything there, just update. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 14, 2024 / 4:30PM, NTRA.OQ - Natera Inc at Canaccord Genuity Growth Conference

Question: Kyle Mikson - Canaccord Genuity - Analyst : Okay. And then maybe for John, like on the studies for Signatera coming up. So 36-month data for GALAXY, I think that's ESMO this year, and then ALTAIR in maybe early '25, maybe in ASCO GI then. So maybe just walk through some of the important benchmarks or endpoints for those trials and why that could really impact the physician community. And I think that, just for example, the DFS for ALTAIR is like 0.667. Threshold-wise, is that appropriate?

Question: Kyle Mikson - Canaccord Genuity - Analyst : Yeah, so MOSAIC was like 20 years ago. The therapeutic landscape, the precision medicine landscape has all changed, probably got more refined, I guess, in more advanced. Is there a reason why this 0.77 -- why did you comment that? Is that like the right number, I guess, and what hasn't changed?

Question: Kyle Mikson - Canaccord Genuity - Analyst : Okay. The token guideline question. So maybe early '25 ALTAIR data, that seems like that was going to be the last catalyst milestone people had before NCCN can update guidelines for CRC for MRD, CTDNA. Could that update happen in 2025? How is the company thinking about that now?

Question: Kyle Mikson - Canaccord Genuity - Analyst : Okay. Yeah. On the -- just switching to women's health, I guess. So you guys have 50% market share, 50% penetrated. It seems like it's getting like saturated, I guess. What's going to drive growth going forward? It did well in the second quarter.

Question: Kyle Mikson - Canaccord Genuity - Analyst : Okay. And then on the Invitae, like on tailwind, I think it was maybe a quarter of the growth in women's health this quarter, possibly year over year. So in the guidance, is it -- is it fair that there's like maybe $50 million to $100 million in revenue for the year?

Question: Kyle Mikson - Canaccord Genuity - Analyst : SP1 Okay. And then just -- out of time here. So there are some product updates that you guys have been alluding to in women's health and oncology. Like, what could that really mean and how important could this be?

Question: Kyle Mikson - Canaccord Genuity - Analyst : Okay. And then one on the guidance. Like for the year, you've raised revenue guidance. You raised gross margin guidance this past quarter. And you kept, I think, the expenses the same Cash flow guidance is still breakeven based at the midpoint. Why did that not go up?

Question: Kyle Mikson - Canaccord Genuity - Analyst : Okay. Last one on '25. Just thinking about that -- we talked a lot about tailwinds possibly. Biomarker could be like a real impact from that, maybe even 22q or other guidelines possibly, ALTAIR being some of a benefit. What do investors not really like focusing on that could be a sell benefit next year?

Question: Kyle Mikson - Canaccord Genuity - Analyst : Okay. Perfect. Thanks, Mike. Thanks a lot for joining.