Biodesix, Inc.

Good day and thank you for standing by. Welcome to the Biodesics Q2 2024 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 11 on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Chris Brinze, Investor Relations. Please go ahead.

Thank you, Operator, and good afternoon, everyone. Today, Biodesics released results from the second quarter of 2024. Leading the call today will be Scott Hutton, Chief Executive Officer. You will be joined by Robin Harper-Cowie, Chief Financial Officer. An audio recording of today's call and the press release announcement with the quarterly results can be found in the investor relations section of the company's website at biodesics.com. As today's call includes forward-looking statements, we encourage you to review the statements contained in today's press release and the risks and uncertainties described in our SEC filings, which identify certain factors that may cause the company's actual events, performance, and results to differ materially from those contained in the forward-looking statements made on today's webcast. In addition, we will discuss non-GAAP financial measures on this call. Descriptions of these non-GAAP financial measures and reconciliations of GAAP to non-GAAP financial measures are included in today's press release. With that, I'd now like to turn the call over to Scott Hutton, Chief Executive Officer. Scott?

Thank you, Chris, and thank you all for joining us today. I'm thrilled to report that it's been another strong quarter marked by exceptional performance in all areas of the business. For 2024, our team and organization remain committed to delivering on three key goals, which include driving increased revenue through the adoption of our lung diagnostic test and our biopharma services, implementing operational efficiencies to continue to deliver strong gross margins, and maintaining a strict cost-disciplined approach on our path to profitability. In the second quarter, we excelled in all three key goals, delivering 51% growth in revenue year-over-year, 78.4% gross margins, and 38% improvement in adjusted EBITDA year-over-year. Based on this continued strong performance, we're raising our 2024 total revenue guidance to 70 to 72 million, up from the previously provided guidance of 65 to 68 million. This change in guidance reflects our continued confidence in the business, and we believe the first half results have set a strong trajectory for continued success in 2024 and beyond. Our LungFocus commercial team is making considerable progress selling our five Medicare-covered to help improve early lung cancer diagnosis and treatment decisions. They delivered 42% growth in test volumes over second quarter of last year. In order to address this massive multi-billion dollar market opportunity, we're continuing to grow and expand the lung focus commercial team. And in the second quarter, had an average of approximately 61 fully trained sales representatives as compared to an average of 55 in the first quarter, 2024. As a reminder, it takes about three months before a biodiesel rep is fully trained, and by that point, they're paying for themselves. Consistent with the plans we've shared before, we will expect to add approximately six to eight reps per quarter to better reach more physicians. In addition to the growth in test volumes, we've added a number of new reimbursement coverage policies for Notify XL2 over the last several months. The coverages include policies from various Blue Cross Blue Shield plans, including Highmark, HMSA in Hawaii, Kansas City, Louisiana, North Carolina, South Carolina, Rhode Island, Tennessee, and Vermont, plus private plans such as Geisinger, HealthPartners, Medica, and others. We're pleased with the steady advancement in reimbursement and remain focused on adding more private payer coverage policies for our tests. In addition, we've also added more contracts, which in combination with these coverage policies have led to improvements in the average revenue received per test result delivered. Combining the improvements in average revenue received with the growth in test volumes resulted in 44% growth in revenue from lung diagnostic tests. We continue to generate clinical data to help drive awareness and adoption of our tests. we presented new data at the 2024 American Thoracic Society International Conference in San Diego, highlighting the ability of our Notify XL2 test to identify benign nodules in patients with emphysema. Emphysema is a common comorbid pulmonary condition in patients with lung nodules. This presentation demonstrates how the Notify XL2 test can successfully assist with ruling out lung cancer regardless of patients' emphysema status. Enrollment and altitude, our prospective randomized trial, evaluating the clinical utility and performance of our notified test, continues at a number of major academic institutions. This study is being overseen by a third-party, independent data monitoring committee that will be determining potential interim analysis and will provide more updates in the coming quarters following their meetings. We also publish new data in the Annals of Oncology that highlights the role of our Genistrat testing to monitor the efficacy of new therapeutic regimens. Our tests utilizing the Bio-Rad DDP-CR technology to analyze circulating tumor DNA have been included in a variety of studies and publications from biodethics, biopharmaceutical partners, and consortia partners. Data has been presented showcasing the utility of the targeted test for detecting treatment resistance, detecting cancer recurrence even before imaging, and monitoring treatment response, such as the data included in this peer-reviewed publication. Speaking of our biopharma services business, we continue to see the momentum that began in the second half of last year, growing 228% over second quarter 2023. This service combines our multi-omic data with our artificial intelligence platform, to uncover novel, unbiased insights that our customers use to personalize patient care and help improve disease detection, evaluation, and treatment. We're achieving growth through additional projects from existing customers, as well as new contracts with new customers from a steady number of incoming RFPs and opportunities. Moving to operations, our team continues to deliver steady and consistent gross margins of 78.4%, which represents the fourth quarter in a row in the upper 70s. Not only have we been effective in providing our test with industry-leading turnaround times, we've also been efficient in delivering those results. With our commitment to an effective, efficient, and cost-disciplined approach, we've built a commercial and operational platform that will help facilitate long-term, consistent, sustainable, and profitable growth. I believe everyone is beginning to appreciate the operating leverage that exists within the business and our efforts to demonstrate the team's significant progress and outstanding execution on our path to profitability. We not only have an incredible opportunity, but a responsibility to transform the standard of care in lung cancer. Lung cancer is still the deadliest of all cancers, as it claims more lives annually in the United States than the next three deadliest cancers combined. breast, prostate, and colon cancer. Time is of the essence when it comes to diagnosing and treating these patients. By discovering, developing, and commercializing tests with demonstrated clinical utility and best in class turnaround times, we believe that our diagnostic tests play a critical role in these efforts to treat the right patients quickly and effectively. Finally, in addition to providing product and service excellence, We believe we're building something unique and special here at Biodesics. In June, we were named to Inc. Magazine's 2024 Best Workplaces. This prestigious award is only granted to approximately 500 U.S. companies each year from across all industry sectors, both public and private firms of all sizes. This is one of our highest honors as it validates and affirms our entire organization's commitment to a culture of excellence. It is a reflection of our amazing team and their commitment to making a difference in patients' lives. And I want to thank everyone for their hard work and dedication. With that, let me turn it over to Robin to review the second quarter 2024 financial performance. Robin.