Lucid Diagnostics Inc.

Good morning and welcome to the Lucid Diagnostics 3rd Quarter 2024 Business Update Conference Call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star 0 for the operator. Please note that this event is being recorded. I would now like to turn the conference over to Matt Riley, Lucid Diagnostics Director of Investor Relations. Please go ahead.

Thank you, Operator, and good morning, everyone. Thank you for participating in today's business update call. Joining me today on the call are Dr. Elishon Ackog, Chairman and Chief Executive Officer of Lucid Diagnostics, along with Dennis McGrath, Chief Financial Officer of Lucid. The press release announcing our business update and financial results is available on Lucid's website. Please take a moment to read the disclaimers about forward-looking statements in the press release. The business update, press release, and the conference call all include forward-looking statements, and these forward-looking statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from statements made. Factors that could cause actual results to differ are described in the disclaimer and in our filings with the Securities and Exchange Commission. For a list and a description of these and other important risks and uncertainties that may affect future operations, see Part 1, Item 1A, entitled Risk Factors, in Lucid's most recent annual report on Forms 10-K, filed with the SEC, and any subsequent updates filed in the quarterly reports on Forms 10-Q and subsequent Forms 8-K. Except as required by law, Lucid disclaims any intentions or obligations to publicly update or revise any forelooking statements to reflect changes in expectations or events, conditions, or circumstances on which the expectations may be based or that may affect the likelihood that actual results will differ from those contained in the forward-looking statements. I would now like to turn the call over to Dr. Elishan Akhog, Chairman and CEO of Lucid Diagnostics. Take it away, Elishan.

Thank you, Matt, and good morning, everyone. Thank you for joining our quarterly update call today. As always, I'd like to thank our long-term shareholders for your ongoing support and commitment our team has always remained singularly focused on driving this Lucid enterprise towards its substantial commercial potential and to enhance our long-term shareholder value. This has really been a great quarter for Lucid, especially after key milestones that we announced last week. We're here. We've been working on this for four years, and we're now fully armed with a complete body of outstanding clinical data to go along with a renewed commercial focus. And we're really poised now to make our final push towards broad coverage and reimbursement to drive e-cigar revenue and revenue growth. So let's start with some key highlights related to our commercial execution. In the third quarter, revenue was $1.2 million, about 20% increase quarter on quarter, and that's a record quarterly revenue for us. The third quarter test volume was $2,787. While third quarter volume is in range with recent quarters following a record second quarter, the fourth quarter is off to a good start with a record test volume in October. Our commercial ramp remains at mid-throttle. We have a critical mass in terms of testing volume to drive our revenue cycle management and medical policy efforts. As we mentioned, we've expanded our direct contracting initiative with multiple programs that are focused on driving near-term revenue. building on the first large Check Your Food Tube event with an upfront contracted payment that we announced earlier. We'll dive deeper into these exciting developments later in the presentation. We continue to be pushing hard with our efforts with firefighters at Check Your Food Tube events and have now tested over 7,000 firefighters with ESAGARD. Let's highlight a few of our key strategic accomplishments. As we announced last week, the ESAGARD DE1 clinical validation study was accepted for peer review publication. And the publication, that publication completes our evidence package for submission to formally seek Medicare coverage. We also had peer reviewed publication of the analytical validation study of ESAGARD, and we received a notice of allowance for a key patent underlying ESAGARD. Perhaps most importantly, we've held three productive in-person meetings with the CMS Medicare Administrative Contract, or MAC, MOL-DX program, the Molecular Diagnostics Program, focused on our upcoming submission for e-cigar coverage by CMS. Just a few quick slides to provide an overview of Lucid and its technologies. Lucid is a commercial stage cancer prevention solution company. We have two products, EsoCheck and EsoGuard, that together provide a comprehensive pre-cancer screening solution, and our mission is to prevent esophageal cancer deaths in an established population of adverse patients. The key technology is the EsoGuard esophageal DNA test, and it is the first and only commercially available test that's capable of serving as a widespread screening tool to prevent esophageal cancer deaths through the early detection of esophageal pre-cancer. And this type of non-endoscopic biomarker testing is now recommended in major professional society guidelines, including the two premier gastroenterology societies. Isagard's performance as a molecular diagnostic test, testing for pre-cancer and cancer, is really unprecedented in the history of molecular diagnostic testing for these conditions. You can see on this slide here our performance, the performance of Isagard relative to comparable early detection tests in the colorectal space. Isagard's Sensitivity of detecting cancer is extremely high at 96%. Really unprecedented sensitivity at 85% in precancerous conditions and a level of sensitivity that's never been accomplished in early precancer at 88%. Even in those who have the shortest segment, small patches of abnormality at 89%. So overall, the two most important numbers is that we have a 99% negative predictive value, which means 1%. both negative rate and a 32% positive predictive value, which means that ESAGARB serves its purpose as a triage test for triaging patients to the invasive test endoscopy. ESAGARB commercial opportunity is really substantial. It's massive. We have a targeted population that's well-defined based on the existing society guidelines. There are about 30 million patients at risk who are recommended for screening. Medicare pricing has been established at $1,938, and this has set a precedent for private payer pricing, which has held up over the years. So the total addressable market right now with no competition is approximately $60 billion. The gross margin per test remains over 90% for each next test on the door. We've shown solid test volume and revenue growth over the past quarter, and this is 30% fewer sellers in the field, as I mentioned previously. We've maintained sort of a mid-throttle approach to our commercial activities, focusing our efforts on garnering reimbursement and driving and establishing revenue-driving programs through direct contracting. Let's now dive into the business update. As we reported in two press releases last week, we've had a recent explosion in our clinical evidence base for ESAGARD. And following this, our team has carefully explored new opportunities to expand our commercial strategy, while we also seek to leverage this complete data set to secure both traditional, commercial, and Medicare coverage. With this data now in hand, we're now laser-focused on translating our test volume and test volume growth into contractually guaranteed revenue. As I mentioned, we've had an explosion of our clinical evidence base. Here's a snapshot of that clinical evidence. I'm not going to go through each of these slides, but as you can see, it's very robust. We have now four clinical validity studies published in prestigious journals. The last one has been accepted for publication and will be published soon. Clinical utility is also important for coverage and discussions with payers, and this data, again, is very robust. as shown here, as well as the analytical validity. So overall, we really have a complete package now to drive our conversations both with Medicare as well as with commercial payers for coverage. So this final publication, the publication of ESAGARD BE1, was really the final piece of the puzzle in this effort to secure traditional commercial and Medicare coverage. With this now fourth clinical validation study accepted for peer review, we really now believe we're ready to go. We have a full package to submit our data to the MOLDI-X program and formally seek Medicare coverage. As I mentioned, we've had three very productive in-person meetings with the MOL-DX group and its leadership over the past few months, and we are poised to submit our data and a request for conversion to a coverage, local coverage determination in the very, very near future. As we also announced last week, beyond our journey to secure coverage, we're now laser focused on translating this test volume growth into contractually guaranteed revenue and we're commercially focused on three revenue-generating programs. They're shown here, fully contracted CYFT pre-cancer testing events, concierge medicine programs, and employer markets. So let me provide some details on each. On the fully contracted CYFT pre-cancer testing events, we will now focus our efforts on securing agreements with self-insured entities, including employers, the unions, particularly firefighter unions and municipal departments, to drive contractually guaranteed revenue. This initiative follows our first major successful directly contracted event where approximately 200 Fort Worth Fire Department firefighters received e-cigar testing in partnership with their medical service provider, Frontline Mobile Health. We've designated an established senior member of our commercial team to focus exclusively on building this pipeline of fully contracted CYFT events, and we really look forward to some near-term wins with that. Next, let's talk a little bit about concierge medicine. This is a new area for us. The concierge medicine sector is rapidly growing nationwide and often offers patients enhanced access to physicians and personalized care for an annual fee. Patients in these concierge medicine practices, they routinely seek cutting-edge technology such as e-cigar. We've hired a new senior director of strategic partnerships for concierge and executive medicine, a highly successful individual who comes to us from Grail, where the concierge medicine program has been very successful in offering new technologies such as Eastergarten. She brings extensive relationships in the sector and has demonstrated success at driving revenue from this sector. Next, let's talk about employer markets. We have had some activity in this space, but we're pushing much harder on it moving forward. Over half The patients in the United States are insured under self-funded plans, including through their employers, unions, and other entities. These plans are typically established through a network of health and wellness program brokers who seek to offer clients value-added services, such as ESAGARD. And we've had good contact and good partnerships with these brokers over the past couple of quarters. We've now hired a new senior director of employer partnerships, also someone who had who brings extensive experience from GRAIL, where she successfully introduced multi-cancer detection tests to employers and brokers. To close the loop, again, the reason we're really excited and feel like we're at a moment in time for Lucid is that we're pushing hard to use the data that we've now completed to advance our CMS coverage efforts with MoldyX and these programs that are designed to drive direct contracted revenue. And so, with that, let's pass the call on to Dennis.