Exagen Inc.

Greetings, ladies and gentlemen, and welcome to the Exygen, Inc. First Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during this conference, please press star zero on your telephone keypad. Please note that this conference is being recorded. I would now like to turn this conference over to your host, Mr. Mike Cavanaugh, Investor Relations for Exygen. Thank you. You may begin.

Good afternoon, and thank you for joining us today. Earlier today, Exogen, Inc. released financial results quarter-ended March 31, 2021. The release is currently available on the company's website at www.exogen.com. Ram Raka, President and Chief Executive Officer, Kamala Dowie, Chief Financial Officer, and Mark Hazeltine, Chief Operating Officer, will host this afternoon's Before we get started, I would like to remind everyone that management will be making statements during this call that include forward-looking statements within the meaning of federal securities 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 are not statements of historical fact should be deemed to be forward-looking statements. All forward-looking statements, including without limitation, statements regarding our business strategy and future financial and operating performance, including 2021 guidance, the impact of COVID-19 pandemic on our business, our current and future product offerings, and reimbursement and coverage are based upon current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results if or materially from those anticipated or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with our business, please see our filings with the Securities and Exchange Commission, including our Form 10-K and subsequent files. The information provided in this conference call speaks only to the live broadcast today, May 11, 2021. Exigen disclaims any intention or obligation, except as required by law, to update or revise any information, financial projections, or other forward-looking statements, whether because of new information, future events, or otherwise. I will now turn the call over to Ron Rocca, President and CEO of Exigen.

Thanks, Mike, and thank you to everyone joining the call today. As always, we appreciate your continued support of Exigen. The first quarter of 2021 was an important one for Exogen, and we are very pleased with our accomplishments. One of the many highlights of the quarter was our successful follow-on offering, which raised over $69 million in gross proceeds and added significant additional liquidity to the market for Exogen stock. We plan to use the added capital to further build our business and position the company for sustainable long-term success. We are accelerating our investments to expand our robust pipeline, which includes our molecular and multiomics development initiatives, our lab expansion, and commercial organization. We've undertaken a major expansion of our laboratory facilities in Vista, California, which will significantly enhance our testing capacity and improve our efficiencies. With our increased investment in research and development, we seek to expand our advised franchise of autoimmune and autoimmune-related testing solutions. Our R&D team is working diligently on developing our fibromyalgia test. This liquid biopsy test is being developed to be the first rule-in, rule-out fibromyalgia diagnostic test. This is a very challenging disease with a very large total addressable market. Although it is not an autoimmune disorder, it is often diagnosed by rheumatologists because its clinical symptoms are so similar to those of connective tissue disease. We are also expanding our R&D capabilities to focus on multiomics by integrating molecular technology with our protein markers. There remains a significant unmet need for approximately 24 million patients suffering from autoimmune diseases. Exigen's commitment to provide novel, differentiating testing solutions with an IP-protected TB-CAPS technology will assist in the expansion of our advised testing franchise for thrombosis, lupus nephritis, and rheumatoid arthritis. These investments uniquely position us for continued growth in this large underserved market. Turning to the performance of our business, we recorded a strong quarter in our advised testing franchise. As you are all aware, due to the ongoing pandemic, many patients remained unable to freely visit their healthcare providers, inhibiting the ability of patients to be tested. Furthermore, there were severe weather conditions in Q1, which impacted our business. Despite these headwinds, Our core testing business proved to be resilient and performed very well. We achieved several records in the quarter, including 29,029 tests, 1,763 total ordering healthcare providers, and 659 adopters for our flagship Advise CTD and Advise Lupus test. We finished the quarter strong with an all-time record volume in March. we continue to achieve very high retention rates of 99% among these adopters. As we have said before, we believe retention rates this high speak volumes about the value healthcare providers place on the ability of advice testing to accelerate the historically slow and frustrating process of clinically diagnosing autoimmune disorders. Our Q1 performance in the face of ongoing pandemic and severe weather gives us real confidence around the strength and value of our advised franchise and our path forward as we continue to expand our footprint with rheumatologists, hospital systems, and payers across the country. As many of you know, autoimmune disorders are notoriously difficult and time-consuming to diagnose using traditional testing. Our CBCAPS technology is a true breakthrough that offers a promise of faster and more accurate diagnosis, enabling earlier intervention into treating these chronic and sometimes deadly diseases. This month, we announced the research collaboration with an exclusive licensing agreement with Allegheny Health Network Research Institute. The collaboration will focus on the development and commercialization of novel patented biomarkers for diagnosing, prognosing, and monitoring of autoimmune diseases. Importantly, we are happy to be working again with key opinion leaders, Dr. Joe Ahern and Dr. Sue Manzi. This is an extension of our R&D organization for the discovery and development of novel autoimmune biomarkers. Additionally, our collaboration enables access to AHN's Autoimmune Center of Excellence, which gives us insights into the latest cutting-edge academic research. We also kicked off 2021 with progress on the reimbursement front. having recently completed covered in-network agreements with Highmark, the fourth largest Blue Cross Blue Shield group in the country, and Tricare West. We remain highly engaged and focused on payers to further expand coverage and in-network status. We signed in-network agreements with two prominent healthcare systems in Q1, Tufts Medical Center in Boston and St. Charles Health Systems based in Oregon. Both health systems recognize the necessity of making more accurate testing accessible to their patients, and we are looking forward to long-term relationships with both. Advise tests are now available to approximately 67 million in-network lives across the U.S., up from approximately 59 million at the end of 2020. And we expect this momentum to continue, increasing our footprint and benefiting ASP. I would also like to touch on our commercial excellence, which is a crucial part of our strategy. In Q1, we expanded to 63 territories. We also began to supplement our sales force by creating inside sales positions in Q1. These new positions were added to perform multiple roles, such as covering white space and augmenting territories to further our reach and frequency with rheumatologists. May is Lucas Awareness Month. As you know, lupus is often overlooked relative to cancer. However, it is a very serious disease which we are bringing more attention to the timely, accurate diagnosis offered through our advised testing. I'm very proud of the ongoing support that Exogen provides to patients throughout their diagnosis and disease management journey. Whether it's through gaining clarity through their differential diagnosis with advised CTD, to regain control of the disease management with the advised SLE monitor, or to address the disparity and other obstacles to optimize care, we remain focused on providing patients and their healthcare providers with the best possible solution for their needs. I would now like to turn over the call to Kamal to discuss our financial results.