Sera Prognostics, Inc.

Good afternoon, and welcome to the SARA Prognostics conference call to review first quarter fiscal year 2022 results. At this time, all participants are in a listen-only mode. We will be facilitating a question and answer session towards 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 comments.

Thank you, Betsy. Good afternoon, everyone. Welcome to Sarah Prognostics' first quarter fiscal year 2022 earnings conference call. At the close of the market today, Sarah Prognostics released its financial results for the quarter ended March 31, 2022. Presenting for the company today will be Greg Critchfield, Chairman, President, and CEO, and Jay Moyes, our CFO. During the call, we will review the financial results we released today, after which we will host a question and answer session. If you have not had a chance to review our quarterly earnings release, it can be found on our website at seraprognostics.com. This call can be heard live by a webcast at seraprognostics.com, and a recording will be archived in the Investors section of our website. Please note that some of the information presented today may contain projections or other forward-looking statements about events and circumstances that have not yet occurred, including plans and projections for our business, future financial results, and market trends and opportunities. These statements are based on management's current expectations, and the actual events or results may differ materially and adversely from these expectations for a variety of reasons. We refer you to the documents the company files from time to time with the Securities and Exchange Commission, specifically the company's annual report on Form 10-K, its quarterly reports on Form 10-Q, and its current reports on Form 8-K. These documents identify important risk factors that could cause the actual results to differ materially from those contained in our projections and other forward-looking statements. As a reminder, a webcast replay of this call will be available on the Investors section of our website. I will now turn the call over to Greg Seropognostics, Chairman, President, and CEO. Greg?

Thank you, Peter, and good afternoon. Today, I will provide an overview of key business highlights during the first quarter and some color on expected developments over the near term. We are pleased with the continued progress in our commercial efforts to secure new pavement contracts, increase test revenue, and publish additional data that further demonstrate the significant health and economic benefits of CIRA's preterm test and treat strategy. This is encouraging, and today, I'll focus my comments on three pillars of our growth strategy, commercial development in support of revenue expansion, further demonstration of value of the preterm strategy through expected study readouts, and pipeline progress of new products. First, I will discuss the commercial development progress. Commercially, we noted on our last call that COVID-19 had complicated and created disruptions in normal healthcare delivery, physician engagement, and enrollment in clinical studies. In addressing these challenges, we have adjusted and streamlined our sales messaging based on experience and made changes in how we address the market opportunity efficiently. We believe these disruptions are currently abating, and our sales team delivered improved order volumes beginning in the second half of the first quarter, with orders accelerating in the February through April timeframe. In fact, to quantify this, orders during the three-month period of February through April increased 171% compared to the preceding three-month period of November to January, with at least 25% order growth in each month during that time. While we may not disclose such figures going forward due to their potential variability, we see this as a good sign that our revised sales methodologies are working. Physician reorder rates have also improved, while process simplifications have decreased order to sample collection days which is also a positive since it yields earlier revenue recognition in the overall testing process. We've begun billing under recently executed agreements, including our agreement for in-network pricing with Multiplan that we announced in February. As a reminder, 700 healthcare payers and 1.2 million healthcare providers participate in Multiplan's provider networks. As a consequence, Multi-plan network participation encompasses a large number of pregnancies annually in the U.S. We view our multi-plan agreement as evidence of recognition of the unique health and cost benefits of using our preterm tests. The first and only commercially available blood test for proactive interventions by measuring each expectant mother's risk of spontaneous preterm birth months ahead of when it occurs. Payers don't make decisions in a vacuum. They're constantly watching to see when other payers are adopting and providing payer coverage for innovative new tests, and they want to see data validating that such adoption will lead to beneficial improvements in health and reduction in health care costs that improve their bottom line. Our upcoming presentation of health and economic benefits of the preterm strategy scheduled later this month provides additional insights into the value of our technology from a clinical and economic perspective. As the market develops, we believe new payers will then be encouraged to sign up, leading to a cascading effect over time. A tipping point phenomenon could then occur in the introduction of our innovative preterm technology as more payers are contracted and where the decision to adopt by a new payer is de-risked by other payers who have already contracted. We look forward to sharing information as we complete new contracts with strategic early adopter commercial payers, healthcare systems, physician network groups, governmental third-party payers, and self-insured employers. It is believed that about 64% of U.S. employees with employer-sponsored health insurance are in self-insured plans, and the sales cycle in contracting with these plans tends to be shorter than with other payers. So this is an attractive market opportunity for us. While they use third-party administrators to carry out necessary functions for payment to take place, it is the employer who ultimately decides what is included in their benefits package. One effect of the pandemic and current economic conditions is that the intense competition for employees is driving the move for improved employee benefits, including a package that supports expectant mothers and their newborns, which is viewed as an important feature of CIRA's story for self-insured employers. And now a word on healthcare disparities. We continue to be focused on underserved individuals and segments of society where access to high-quality healthcare services is low. While Medicaid patients comprise approximately 42% of pregnancies, they account for half of all preterm births. We are engaged in active dialogue with government officials, political leaders, Medicaid leaders, health insurers, and organizations focused on improving the well-being of mothers and babies by reducing healthcare disparities among the underserved. Our preterm test is ideally poised to enable a real positive difference in these populations by objectively identify pregnancies at risk for spontaneous preterm birth, enabling healthcare practitioners to intervene proactively, to promote better care and outcomes for these mothers and babies. Our recent announcement of our collaboration with the Newborn Foundation's Every Mother, Every Baby project is one of many examples of CIRA's work to make a real difference. Now for a brief update on forthcoming data on the use of our preterm test. Later this month, we are scheduled to present a new clinical utility and health economic data analysis that illustrates the value of CIRA's test and treat strategy. This is an independent cohort of patients for whom preterm testing was performed and where the impact of applying proactive interventions in patients identified to have higher preterm risk was evaluated. While the analysis is embargoed until its presentation at the conference, we expect to share more very soon about this work. I'm also happy to report that we are seeing a ramp-up of enrollment in our large, multi-centered prime study within the Anthem Network. with new sites bringing the total of enrolling centers to 13. We believe PRIME will add to the already large and growing body of published data on our preterm test. The PRIME study is on track for an interim look readout to occur in 2023. We anticipate that this study will provide additional compelling evidence to payers of the value of implementing the preterm test and treat strategy. Finally, let me take a moment to discuss progress on our pipeline product development. We continue to progress our pipeline beyond the preterm test, an industry-first and only broadly validated and commercially available blood test in evaluating the risk of spontaneous preterm birth months ahead of time. We are also on track by mid-2022 to validate yet another industry-first with our proteomics prognostic biomarker preeclampsia test that is a complement to our preterm test. This additional important test is designed to provide a prognostic assessment of the risk for preeclampsia. Preeclampsia affects approximately 5% to 8% of all births, while preterm birth occurs in about 10% of pregnancies. Sarah's goal is to provide both tests from a single blood drop to give clinicians a more complete picture of the risk for two of the most common and important adverse conditions of pregnancy. We believe that the successful validation of our unique preeclampsia test will further establish Sarah's expertise in providing valuable pregnancy information designed to improve maternal and neonatal health. This should, in turn, strengthen our competitive lead as the first mover offering more comprehensive pregnancy information and thus solidifying our position as the pregnancy company. I'll now turn the call over to Jay for a review of our first quarter financial results.