Fulgent Genetics, Inc.

Hello, and welcome to the Fulgen Genetics Q2 2023 Earnings Conference Call and Webcast. If anyone should require operator assistance, please press star zero on your telephone keypad. A question and answer session will follow the formal presentation. You may press star one at any time to be placed in the question queue. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Melanie Salomon, Investor Relations for Fulgen. Please go ahead, Melanie.

Thanks, Kevin. Good morning and welcome to the Fulgent second quarter 2023 financial results conference call. On the call with me today are Ming Hsieh, Chief Executive Officer, Paul Kim, Chief Financial Officer, and Brandon Perthews, Chief Commercial Officer. The company's press release discussing the financial results is available on the investor relations section of the company's website, www.fulgent.com. The replay of this call will be available shortly after the call concludes on the Investor Relations section of the company's website. Management's prepared remarks and answers to your questions on today's call will contain forward-looking statements. These forward-looking statements represent management's estimates based on current views and assumptions, which may prove to be incorrect. As a result, matters discussed in any forward-looking statements are subject to risks, uncertainties, and changes in circumstances that may cause actual results to differ from those described in the forward-looking statements. The company assumes no obligation to update any of the forward-looking statements it may make today to reflect actual results or changes in expectations. Listeners should not rely on any forward-looking statements as predictions of future events and should listen to management's remarks today with the understanding that actual events, including the company's actual future results, may be materially different than what is described in or implied by these forward-looking statements. Please review the more detailed discussions related to these forward-looking statements, including the discussions of some of the risk factors that may cause results to differ from those described in these forward-looking statements contained in the company's filings with the Securities and Exchange Commission, including the previously filed 10-K for the year ended December 31, 2022, and subsequently filed reports which are available on the company's investor relations website. Management's prepared remarks including discussions of earnings and earnings per share contain financial measures not prepared in accordance with accounting principles generally accepted in the United States or GAAP. Management has presented these non-GAAP financial measures because it believes they may be useful to investors for various reasons, but they should not be viewed as a substitute for or superior to the company's financial results prepared in accordance with GAAP. Please see the company's press release discussing its financial results for the second quarter of 2023 for more information. including the description of how the company calculates non-GAAP income or loss, earnings or loss per share, and adjusted EBITDA, and a reconciliation of these financial measures to income or loss and earnings or loss per share, the most directly comparable GAAP financial measures. With that, I'd now like to turn the call over to Ming.

Thank you, Melanie. Good morning. And thank you for joining our call today. I will start with some comments on the quarter. Then Brandon will review our product and go-to-market updates for the second quarter. And Paul will conclude with the financials and outlook before we take over your questions. We are pleased with our results in the second quarter with another record core revenue reaching $67 million and less than $1 million of COVID revenue for a total of just under $68 million of revenues. Our core revenue was driven by strong results across all three areas of our diagnostic business, precision diagnosis, anatomic pathology, and pharma services, including our expanded beacon carry testing for reproductive health service. We are encouraged by the outperformance in the first half of the year, and seeing good sales momentum as we move into the second half of the year. We continue to make good progress with our therapeutic business. Bosium Pharma, our novel nano-encapsulation technology, including our 4D patterns and the target therapy platform designed to improve therapeutic windows and the pharmacodynamic profile of both new and existing cancer drugs. Our lead drug candidate, FID-07, has shown promising results for treatment of numerous cancers, including head and neck, anterior and pancreatic, with reduced side effects. In June, we presented safety and efficacy data from the ongoing Phase 1b study at the American Society of Clinical Oncology Annual Meeting in Chicago. In summary, of 40 heavily treated patients of various cancer types with a weekly dose level from 50 milligram per square meter to 160 milligram per square meter, 18% had a partial response and 35% had a stable disease. Three out of four squaring cell carcinoma of head and neck cancer patients with partial response had previously been treated with taxin. No high-grade neuropathy was noticed. FID-07 demonstrated preliminary evidence of anti-tumor activity in heavily pretreated patients across various tumor types. Based on the overall tolerability from cold dynamics and the efficacy, 125 milligram per square meter has chosen as recommended phase two dose. We received a positive response for the data from medical community and continue to optimize our manufacture process as well as preparing the initial phase two studies. We look forward to share an additional update of the start of that trial by end of the year. We also have a deep pipeline in preclinical development, focusing on targeted therapies for additional cancers. I'd like to thank our employees and the shareholders for your loyalty during the quarter. We look forward to the second half of the year and the momentum we are creating with our combined business. I will now turn over the call over to Brandon Perthes, our chief commercial officer, to talk about our diagnostic business results during the quarter. Brandon.