Renalytix Plc

Good morning and welcome to the Rinalytics conference call to review first quarter results for fiscal year 2022. At this time, all participants are in a listen-only mode. We will be facilitating a question and answer session toward the end of today's call. As a reminder, this call is being recorded for replay purposes. I would now like to turn the call over to Peter DiNardo of Capcom Partners for a few introductory remarks.

Thank you, Catherine, and thank you all for participating in today's call. Joining me today from Rentalytics are James McCullough, Chief Executive Officer, Tom McLean, President, and James Sterling, Chief Financial Officer. Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements made during this call that relate to expectations or predictions of future events, results, or performance are forward-looking statements. Examples of these statements include, without limitation, statements related to Kidney Intellect's ability to lower healthcare costs, improve patient quality of life, and set a long-term standard of care, trends in our market and potential benefits of government policy change, the impact of COVID-19 on our business, our expectations for hiring, product development, strategic partnerships and collaborations, reimbursement decisions, clinical studies, and regulatory submissions, and our business strategies and future growth. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a description of the risks and uncertainties associated with our business, Please refer to the Risk Factors section of our annual report on Form 20-F that was filed on October 21, 2021, with the Securities and Exchange Commission. All forward-looking statements made on this call are based on management's current estimates and various assumptions, right on what it sustains any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, December 7, 2021. And with that, I'll turn the call over to James McCullough. James?

Thank you, Peter. Good morning and good afternoon. As the end of this calendar year approaches, we are confident that our healthcare system partnership model is delivering a unique value proposition for changing the course of chronic disease management. As the real-world numbers start to build, lessons learned from the Kidney Intellex implementations at Mount Sinai, Wake Forest, Atrium Health, CDPHP, and now the Veterans Health Administration System are setting the foundation for a national model with the potential to enable a broad section of healthcare providers to drive better outcomes for the greater than 12 million people with diabetic kidney disease in the United States. At Mount Sinai, the Kidney IntellX program experienced growth during the quarterly period, and most importantly, continues to generate key utility data around physician behavior, risk assessment ordering, and follow-on clinical actions. In mid-November, Kidney IntellX testing was extended to the Mount Sinai network sites across Long Island and Queens in New York, incorporating several new physician practices to integrated electronic health record ordering. We are now able to measure a critical measure, critical metric and volume growth for the Kidney IntellX program with conversion from pre-pended to executed orders. Said another way, conversion is the percentage of doctors who actually order Kidney IntellX testing for their patient in response to a centralized population health suggested or pre-pended order. Mount Sinai is now seeing conversion rates as high as 80% in the quarter ended to September. an outstanding metric of performance and a direct measure of active engagement in risk assessment by clinicians. Further, Mount Sinai is now leveraging its population health pharmacy management program to support primary care practices on diabetic kidney disease and optimizing therapy decisions early in the disease cycle for those patients that Kidney IntellX has prognosed at intermediate and high risk. Doctors are now demonstrating that assessing risk in their kidney disease patients is important and are willing to take direct action on a prognostic result. Assuming this high rate of conversion to executed orders with coordinated pharmacy management continues, we will have demonstrated important clinical activation beginning at the primary care level. This should provide publishable evidence that health systems implementing the Kidney IntellX model have the potential to drive significant improvements to diabetic kidney disease management across large groups of practicing primary care physicians connected through the electronic health record system. We believe conversion and pharmacy management will support real-world evidence results published in the coming quarters and will accelerate additional healthcare system adoption and payer coverage in 2022. Implementing its scale in a complex healthcare environment such as Mount Sinai has required many learnings and continuing innovation. Importantly, we are now demonstrating the Kidney IntellX care model can not only be applied across multiple healthcare systems with different operating environments, but that we can accomplish a full implementation to clinical testing in shorter timeframes. With our Wake Forest implementation, for example, we were able to achieve the start of clinical testing in just six months from execution of contract. A go-live timeframe we are now targeting to reduce to three to four months with coming system partnerships. We expect implementation in our most recent hospital system partner, St. Joseph's, will be the most efficient to date. Implementations such as Mount Sinai, Wake Forest, University of Utah, physician-led payer network CDPHP, and the VA medical system are complicated by requirements to coordinate electronic health record system integration, broad physician education, defining a care pathway with general and specialty physicians, and setting up a pharmacy management program. This complication, however, is offset by long-term care management relationships that can reach large physician bases and their patient populations from the outset, a significant competitive barrier to entry. The Mount Sinai, St. Joseph, and CDPHP implementations are demonstrating the value in focusing on a healthcare region. With concurrent regional implementations, we expect to achieve efficiencies in sales and medical science liaison personnel deployment, and overlapping insurance coverage across different patient populations. We also see a potential saturation effect beginning to occur, which is generating awareness and near-term demand from other players operating in the New York State region. St. Joseph's also offers an opportunity to accelerate adoption into a larger patient population as they are part of the Trinity Health System, the fifth largest healthcare network in the United States with 1,600 member healthcare facilities. We expect to announce additional partnerships in the New York region throughout 2022. The Kidney IntellX real-world evidence utility should continue to expand rapidly with tested patients to date now numbering into the thousands. Real-world evidence testing and care management in the Kidney IntellX diabetic kidney disease population could well exceed 20,000 patients in calendar 2022. This is no small population data set and provides renalytics with considerable use case experience and the statistical power to begin addressing insurance payment for repeat testing in high and intermediate risk patients, potentially expanding the indicated uses to include diagnosis and therapeutic response monitoring, and to other potential related disease indications such as cardiovascular event risk. In short, the real-world evidence program we have established provides a direct potential pathway to significant increases in the Kidney IntellX total addressable market and begin to erect a one-stop shop for practicing primary care physicians to assess chronic disease risk. Our real-world evidence program also has the potential to provide Kidney IntellX with a significant competitive advantage through continuous product innovation and performance improvements. With the General Services Administration contract that establishes full reimbursement at $950 per reportable result for any kidney IntellX test ordered by a government physician, we are on our way to a sustainable revenue pathway. In the VA health system alone, there are approximately 400,000 diagnosed diabetic kidney disease patients eligible for a kidney IntellX baseline risk assessment today. Again, because we have full reimbursement in this population, We have hired, trained, and are deploying sales personnel, in addition to medical science liaison personnel, into the VA system to begin supporting Kidney IntellX usage nationally. Given our overall experience and implementation success, we are now targeting 20 large hospital systems Kidney IntellX contracts in 2022. These systems could provide us with the potential to achieve seven figures of diabetic kidney disease patients integrated into a kidney IntellX risk assessment model. I would now like to turn the conversation over to our president, Tom McClain, for an update on our commercial progress.