GeneDx Holdings Corp.

Thank you for standing by, and welcome to GeneDx's fourth quarter 2022 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. I would now like to hand the call over to Head of Investor Relations, Tricia Trueheart. Please go ahead.

Thank you, Lateef, and thank you to everyone who is joining us today on this call. I'm Tricia Trueheart, Head of Investor Relations at GeneDx. On the call today, we have Katherine Stubland, Chief Executive Officer, and Kevin Feely, Chief Financial Officer. Earlier today, GeneDx released financial results for the fourth quarter and full year, ended December 31st, 2022. A copy of the press release and our fourth quarter earnings slide deck are available on the company's website. Before we begin, I'd like to remind you that management will make forward-looking statements within the meaning of federal security laws, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements contained in this call that relate to expectations or predictions of future events results or performance are forward-looking statements. Actual results may differ materially from those expressed or implied in the forward-looking statements due to a variety of factors. Additionally, these forward-looking statements, particularly our 2023 financial guidance, our expectations for revenue growth, gross margin, and profitability over the next several years, and our expected cost savings and reduction in cash burn involve a number of risks, uncertainties, and assumptions. For a list and description of the risks and uncertainties associated with GeneDx's business, please refer to the risk factors section of our latest Form 10-K filed with the Securities and Exchange Commission and the other documents filed by us from time to time with the SEC. We urge you to consider these factors and you should be aware that these statements should be considered estimates only and are not a guarantee of future performance. During the call, we may discuss certain non-GAAP financial measures. For reconciliations of the non-GAAP measures to GAAP financial measures, as well as other information regarding these measures, please refer to our earnings release and other materials in the Investor Relations section of our website. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, March 14, 2023. GNDX disclaims 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. And with that, I will turn the call over to Katherine.

Thank you, Trisha. Before I dive into Q4 and full year performance, given the many recent changes in GeneDx, I'd like to provide a brief overview of our company today and our strategy going forward. First, we have a new name and a new ticker symbol. We're proud to now be GeneDx and to be trading under WDS, a nod to our vision of bringing the benefits of whole genome sequencing to everyone. Since emerging from the NIH two decades ago, we have built a reputation for being the team you can count on to diagnose the most difficult to diagnose patients. Since then, we have built the industry's leading rare disease panels, exome and genome, fueled by our proprietary genomic interpretation platform. This platform delivers actionable insights to clinicians with a higher and more definitive level of confidence while reducing the number of unknowns and analyzing genetic codes, resulting in more diagnoses for more patients. Combining this with the Centralis platform from Semaphore, we can leverage clinical data in a way that adds critical layers to our understanding of disease, including phenotypic information, symptoms, family history, and longitudinal data. Our team has worked diligently, systematically, and intelligently to execute on our mission going forward. In late 2022, we turned to a new strategic direction, exiting the reproductive health and somatic oncology testing business, which we believe will enable GDX to scale the profitability in 2025. Today, we announced 2022 pro forma revenue of $171 million from this go-forward business of GDX, and we have already guided that we expect to generate revenues between $205 to $220 million in 2023. Last year, on a pro forma basis of the continuing GeneDx business, we delivered almost 40% growth with 40% growth margins with expectations to continue to grow in 2023 and beyond. GeneDx's ability to interpret data has been the key to unlocking the next phase of clinical genomics, born from over a decade of constructing our proprietary data sets. To date, we have analyzed more than 400,000 exomes, almost a quarter of which were analyzed in the past year, and we're doing more each and every day. The snowball effect of accumulated gene DX data identifies more pathogenic findings that others miss, as our genomic sequencing analysis generates less uncertainty and a higher diagnostic yield compared to multi-gene panel-based tests. We're in a perfect storm of commercial opportunity. While we've been building our own capabilities, there's been an expansion of clinical and practice guidelines and coverage policies across the healthcare space, which are enabling the adoption of exome sequencing for a wide range of patients. In the past two years, several new medical guidelines have been issued recommending exome and genome sequencing as a first step for patients with congenital epilepsy, neurodevelopmental disorders, and intellectual disabilities. These physician recommendations have included the evidence that compared with standard genetic testing, exome and genome sequencing has a higher diagnostic yield and may be more cost effective when ordered early in the diagnostic evaluation. Our team is working to convert physician ordering patterns from multi-gene panel tests to exome sequencing, and a lot of these recommendations and continued education will continue to help modify their practice. In addition, you may have seen recently that both UnitedHealthcare and CIDMA, two of the nation's largest commercial insurers, have adopted favorable coverage for exome and whole genome sequencing. As a result, tens of millions of patients now have covered access to our services. So as physician adoption increases, cost of sequencing declines, and the payer community further adopts clinical guidelines, we anticipate that this may contribute to significant profitable growth of our truly differentiated offerings. The opportunity for GDX to drive biopharma partnership revenue from our data is significant, yet still at an early stage. In 2020, 55% of novel new drug and biological approvals from the FDA were orphan drugs for rare diseases. The understanding of the data we have accumulated to date allows for the potential to ultimately accelerate treatment timelines and provide the best care possible. This data could also be integral in clinical trial design, drug discovery, and development for biopharma companies. We're taking a pragmatic approach to working with partners to best identify how we can work together to deliver insightful and actionable information from a variety of sources. And while we believe our information and data business may be proportionately small today, it's an important long-term strategic growth opportunity. We're also investing in clinical research and studies that will further demonstrate the value of exome and genome sequencing for newborns, including the SeqFirst and Guardian studies. These studies and others will add to the growing body of evidence that the GeneDx platform can generate significant new information and ultimately lower the cost of treatment for difficult-to-diagnose rare disease and pediatric patients. With SeqFirst, We're generating clinical and health economics data in partnership with the University of Washington and Illumina. As presented at the American Society of Human Genetics annual meeting last October, the first phase of the study demonstrated that rapid genome sequencing in the NICU has the power to transform clinical approaches for critically ill newborns and therefore improve overall health outcomes. Our partnership in the Guardian Genomic Newborn Screening Study, along leading researchers at New York, Presbyterian, and Columbia, is designed to demonstrate how whole genome sequencing of newborns can deliver important diagnostic findings associated with 250 genetic conditions. Importantly, we plan to provide an update from this study at this week's American College of Medical Genetics and Genomics annual meeting. We're confident that through additional research collaborations across a number of areas, GeneDx will continue to provide benefits to patients, physicians, and caretakers. We have recently been included in several publications that highlight the critical role that our genomic insights play in the delivery of informed, patient-centered care. It also supports the identification, discovery, and development of screening therapeutics to manage and treat rare genetic diseases. We submitted nearly one quarter of all candidate gene submissions to a public database, GeneMatcher, in 2022 and collaborated on 63 publications involving new disease gene associations or expansion of phenotype discovery. And while our commitment to rare disease continues, we have also found that our genetic data has contributed to an improved understanding of the biology of more common disorders, such as sleep apnea, and can be applicable to much broader segments of the general population. The genomic data from these studies will become even more powerful when combined with our Centralis platform, fueled by comprehensive and definitive data sets built over the last 10 years. We believe we have a strong, thriving business with differentiated, best-in-class exome and genome analysis and capabilities to evaluate the insights that this data can provide. We believe that GNDX will be the partner of choice for patients, clinicians, healthcare systems, and biopharma companies. I'd like to close my remarks by extending my sincere thanks to the entire GNDX team, without whom these achievements would not have been possible. Importantly, with the $150 million that we raised in January, we are now fully funded with the capital required to realize our mission. On behalf of our team, we're grateful to our shareholders for the opportunity to do so. With that, I'd like to pass the call over to Kevin.