Myriad Genetics, Inc. Price & Performance (MYGN)

Please note that some of the information presented today contains projections or other forward looking statements regarding future events or the future financial performance of the company. 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 SEC, specifically the company's annual report on Form 10 ks its quarterly reports on Form 10 Q, and its current reports on Form eight ks. These documents identify important risk factors that could cause the actual results to differ materially from those contained in our projections or forward looking statements. Turn the call over to our CEO, Paul Diaz. Thanks, Matt. Good afternoon, everyone, and thank you for joining us On today's call, we will discuss our fourth quarter and full year performance, and provide an update on the progress we continue to make. To accelerate profitable revenue growth and innovation in advanced diagnostics. First, I want to thank my Myriad teammates and our provider partners for their continued support commitment to advancing our mission and vision. To make genetic testing and precision medicine more accessible to help people take more control of their health.

Delivering on our mission would not be possible without our Myriad teammates. Who continue to recognize our company as a great place to work. We approximately 84% of our teammates rating us as such. Additionally, Forbes recently named Marriott in its list of best employers for 2025. Most everyone you meet at Myriad loves what they do, and we see it played out daily as our teammates go above and beyond to serve our provider partners and their patients. This is reinforced by our strong 72 net promoter score, which captures how different external groups from providers to payers score their interactions with Myriad. Our active pipeline of innovative and clinically relevant products is supported by the clinical studies and data that we continue to produce at an accelerated rate. As we continue to invest to bring new science to the marketplace, we continue to maintain industry leading margins achieve profitability and are seeing growth across the enterprise. I want to now highlight the progress that Myriad Genetics has made over the past five years. We're a very different company than when we started this journey in 2020. And our proven ability to innovate, grow organically and reach profitability has set us apart from many of our respected peers in the industry.

Top tier science and innovation are at the foundation of miragenetics as we deliver clinically differentiated products supported by technology, to deliver value in real world clinical settings. And enable early detection and better treatment decisions for providers and their patients. Combining our mission and vision, with expertise in our lab operations, our technical capabilities, together with our in-depth regulatory compliance and revenue cycle management, we find ourselves in a position to serve our customers at scale. And profitably. We continue to deliver our commitment to shareholders as we achieved 11% revenue growth in 2024 as compared to 2023. Reflecting both volume and revenue per test improvements across the portfolio. Our focus on profitable growth continues as we generated approximately $589,000,000 in adjusted gross profits dollars $40,000,000 of adjusted EBITDA, positive adjusted EPS of $0.14 and maintained approximately $158,000,000 in liquidity in 2024. Continued execution of our strategic priorities and commercial growth strategy, support our long term financial targets. Together with our recent new pending product launches give us the confidence we can accelerate growth 2026 and beyond. Today, we announced an exclusive partnership with Pathomix to apply their advanced AI technology platform to our suite of oncology products. Enabling Myriad to provide urologists and radiation oncologists with molecular and AI powered testing solutions to inform decisions both before treatment at the time of biopsy for active surveillance and following surgery or radiation treatment.

This complements Myriad's existing offerings of combining germline and comprehensive tumor profiling as recommended by NCCN guidelines for prostate cancer care. With that, I'll now turn the call over to Sam. Thank you, Paul.

I want to take a moment to recognize the hard work that you and our Myriad team put in the past four point five years to deliberately focus in on areas of strategic importance. Divesting non strategic assets, restructuring to get our cost basis under control and shifting to invest and prioritize Thank you, Paul, for your leadership. Next slide. As we move forward into 2025 and beyond, we will continue to be guided by our mission to advance health and well-being for all. Along with our commitment to delivering predictable sustained profitable growth. Four elements of our strategy in oncology, women's health and pharmacogenomics remain intact. As does our focus on providing an easy to use customer experience across our product portfolio from learning about our offerings, to test ordering to results delivery, along with patient and provider education and support. We will continue to increase our focus providing relevant compelling product offerings for sizable attractive market opportunities where we can leverage Marriott's differentiated capabilities and right to win. We will also have a stepped up focus on execution excellence across the company to support the achievement of our strategic intent and ongoing business and financial objectives. Next slide.

MyRisk remains the gold standard in the market for hereditary cancer testing. Building on this cornerstone, our strategy in oncology remains serve the continuum of patient care from screening and prognostics, products including Myriad and Polaris, the therapy selection with products including MyChoice Precise Tumor to monitoring and therapy adjustment. Including precise MRD, for the most prevalent cancer indications including breast, prostate and ovarian. We will drive growth by focusing on products that are most needed leveraging our broad commercial reach established reputation for quality, and delivering diagnostic insights with clear clinical utility. As we develop and update products, we will be deliberate about having a clear path to guideline inclusion and reimbursement. Our biopharma service business will help drive evidence generation for key applications while also supporting our pipeline of new cancer diagnostic tests and providing profitable revenue. Next slide. Our strategy for women's health remains centered on providing relevant trusted testing solutions throughout a woman's reproductive journey and beyond. We're excited about the potential for our women's health business including the sizable MyRisk cancer screening opportunity we related to an estimated 50,000,000 unaffected women in The United States that meet guidelines for hereditary cancer testing. In We will continue establishing and strengthening partnerships hospital systems and provider networks to identify and serve these unaffected patients.

We will also continue to bring differentiated clinically relevant prenatal health products to market procuring and NITS such as Precull, which delivers critical insights at eight week gestational age as compared to ten to twelve weeks Next slide. Turning now to pharmacogenomics. Mental health continues to be a significant issue in The United States. And continues to be a meaningful opportunity for Myriad. [indiscernible] one in five Americans develop a major depressive disorder in their lifetime. And our GeneSight test provides an important tool to healthcare providers to get patients on the right medication faster than conventional medical practice. As Mark will discuss later, we continue to see good demand for GeneSight are excited about the momentum we see biomarker legislation. Our strategy for GeneSight growth includes continuing highly effective digital engagement from driving provider and patient awareness to provider onboarding. It also includes optimizing patient direct payment options and optimizing revenue cycle workflows to maximize reimbursement. Next slide. Looking ahead, let me share some of the key elements that will enable Myriad's sustained growth. First, as Paul and I have already touched on, important part of the growth will come from a stream of organically developed This includes recently launched Preval for early gestational age upcoming launch is a first gene in Precise MRD.

Our growth will also come from the increased focus on executing corporate programs that have the potential to drive material testing volume increase, including the breast cancer risk assessment program and EMR integration value realization. Finally, in a dynamic fast paced market, with technology is advancing quickly, will be times where partnering is the faster, more efficient path to capture an opportunity by complementing our own areas of We will supplement our organic efforts with purposeful partnerships that enable us to serve high growth attractive market opportunities with a focus of bringing compelling solutions to our targeted customers with speed, the potential of drawing high return on invested capital. Next slide. The Pathhomic collaboration that we announced earlier today illustrates how we will leverage strategic partnerships. The Foamix validated AI technology platform extracts hidden insights from complex cancer morphological structures to quickly and efficiently deploy new use cases to predict patient outcome treatment response and genotype mutations. This image based AI technology can deliver results one or two days after receiving the digital images from a patient sample. Pathomic was founded around prostate cancer and has a deep clinical expertise and extensive relationships KOLs in this area. While the current pathogenic model is specific for use in patients with prostate cancer, the underlying foundational model provides opportunities for applications in virtually all solid tumor cancers that are diagnosed through a biopsy with H and E staining.

Also, the partnership with Pathomik will help accelerate the timeline for gaining Simon level one evidence for Polaris.

For prostate cancer, Myriad is a leader for diagnostic testing at the time of biopsy with ProLeris.

Which is a molecular test and form active surveillance. The collaboration with Pathomic will enable us to also provide urologists and radiation oncologists with an AI based testing solution post radical prostatectomy or radiation where we do not participate today to guide treatment options. So within 2025, Myriad will have a molecular plus AI solution set to serve the market opportunities for both biopsy, preactive surveillance and treatment selection post radical prostatectomy or radiation. From diagnosis to metastatic disease. Also, as Paul mentioned, the NCCN guidelines recommend the use of germline and somatic information to support cancer care.

And with our Myriad and Precise Tumor test, we will deliver a comprehensive a comprehensive set of solutions for providers to care for patients across the prostate care continuum from diagnosis and therapy selection to monitoring and therapy adjustment and over time for remission. And now, as I hand it off to Mark Verati, I want to take a moment to thank you, Mark. For your leadership of our commercial organization and for driving meaningful revenue growth and sales force productivity over the past few years.

Thank you as well for your partnership from the moment I joined Myriad Really looking forward to continuing working closely with you our Chief Operating Officer.

Thanks, Dan, for the kind words, trust and leadership. Also want to echo Sam's comments and thank Paul. For his leadership, guidance and partnership over the last four and a half years. Turning to Slide 17. Full year 2024 revenue grew 11% year over year. Our ASP remains stable with 3% growth over the year. For the fourth quarter, hereditary cancer testing revenue increased 6% compared to last year, while prenatal revenue grew 12% over the same period. GeneSight continued to show strong demand as well with revenues up 14% in the quarter. I do want to address our slower than expected volume growth in Q4. Our prenatal gene site and affected hereditary business remained on track While our unaffected business slowed due to attention placed on the launch of Prequel at eight weeks gestational age and EMR workflow conversions taking longer than expected. Next slide. EMAR solutions continue to be a key area of investment. Across our enterprise as we seek to improve the customer and patient experience. Our efforts with EMR systems are making a difference in the way we engage with our customers and will be an important driver of future volume growth. As Sam has mentioned on previous calls, over the past two years, we have doubled our investment in EMR through engineering, integration and commercial pull through resulting in more than 4,500 new clinic locations in 2024.

We have system integrations, we have system integrations across 15 plus different vendors including strategic partnerships with key EMRs like Athena, [indiscernible] Flatiron for Oncology and Lumiya for urology. This has been an incredible effort by all our teams Although we have seen workflow disruptions at certain health systems take longer to fully integrate and often take several quarters to stabilize and yield increased volumes. Next slide. In 2024, our women's health team delivered 14% revenue growth year over year as we continue to sell deeper into current accounts and win new accounts. We are leveraging our breast cancer risk assessment program and establishing key partnerships with hospital systems and provider networks to identify and serve those unaffected patients. Over the course of 2024, our women's health team successfully launched exciting new collaborations including partnerships with JScreen, Cancer Care to expand access to prenatal and Myeris test base. Next slide.

In 2024, we launched our expanded carrier screening test Foresight Universal Plus. Which features an expanded panel of genes as well as more efficient workflows. Guideline and payer coverage expansion for carrier screening is something we are excited about as we look for ways to expand access to Foresight universal In Q4, we launched our new Prequel product, which delivers critical insights at eight weeks gestational age as compared to ten or twelve weeks. Significantly increasing the provider and patient experience delivering critical information to pregnant parents, much sooner than any other test of its kind. In 2024, GeneSight continued to see double digit growth revenues up 23% year over year. We continue to work with UnitedHealthcare to find a solution for the recent decision not cover this category of test for their patients. Despite this reimbursement challenge, our volume demand remains strong and we are committed to our pharmacogenomics business and the important role it plays for more than 30,000 clinicians who use GeneSight to inform how they treat their patients. Data from the Optum study showing increased economic utility of GeneSight was recently accepted for publication. And is expected to appear in print form in the next three weeks.

Additionally, new meta analysis data is expected to be published in the first half of this year with more data to follow in the second half of the year. Next slide.

In 2024, our oncology team delivered 24% Myriad affected revenue growth [indiscernible] We saw consistent volume in ASP growth throughout the year as we focused on large account EMR integrations, and driving paired testing across multiple products. Additionally, we recently placed our urology team within our oncology team to drive greater synergies in marketing, medical affairs and sales resources. Turning to prostate cancer on the next slide. Has been some confusion regarding the updated NCCN guidelines. And we want to share that Polaris is included in those guidelines for low, intermediate and high risk patients at the time of initial biopsy. Furthermore, every test in the urology market that Polaris competes with has the same NCCN Category 2a level of evidence Guidelines also state the need for germline and tumor profiling testing for certain prostate cancer patients. Now that we have added Pathomics AI technology platform to our portfolio, Geary is the only company that offers AI, biomarker, germline and tumor profiling testing. Although these updated guidelines were met with some confusion in the marketplace, in speaking with our 20 largest urology accounts, they have reinforced their belief in the clinical utility and relevance of Polaris with the demand for testing showing no signs of slowing down in 2025.

We are increasing capacity in prostate cancer sales medical sales, marketing and now AI products. Leveraging these investments to support urologists from the time of biopsy through post surgery with radiation oncologists. Next slide. In closing, we are excited about 2025 and our focus on accelerating integrations driving depth through paired testing and our expanded pipeline and product launches. We look forward to MiRisk gene expansion, Precise Liquid, First Gene and MRD in the coming quarters. I will now turn the call over to our CFO, Scott Loeffler. Thanks, Mark. I'll start on the next slide.

We are pleased with our continued progress this year having generated 11% total revenue growth including domestic revenue growth of 15% This growth was driven across a number of areas Provenatory cancer testing revenue grew 11%, while prenatal and pharmacogenomics grew 17% in 23% respectively. 2024 revenue growth also reflects the positive sustainable pricing environment, which we have highlighted on past calls. Regarding fourth quarter results, total revenue grew 7% year over year. Domestic revenue grew 11% in the quarter partly offset by the Q3 of twenty twenty four divested of our EndoPredict business in Europe removes approximately $11,000,000 of annual run rate revenue. Mark addressed the commercial dynamics affecting Q4 volume growth and I reiterate our belief that test volume growth in hereditary cancer and prenatal will reaccelerate as the year progresses. We did benefit modestly from a favorable change of estimates from prior periods in Q4 but the amount was less than either Q3 of 'twenty four or Q4 of Next slide. We have been highlighting key drivers for sustainable progress in average revenue per including various investments and initiatives by both our revenue cycle and payer markets These included among other things working with health plans to encourage their implementation of medical policies that conform to state biomarker legislation.

There is a growing list of states that have passed biomarker legislation that lends itself to ensuring access to precision medicine and advanced diagnostics. Generally, no one of these wins is likely to have a material impact on revenue but we certainly expect the accumulation of many small and medium sized wins over [indiscernible] to contribute to the rate environment for our products. In Q4, we again saw stability in underlying rates which represents another proof point for the great work being done by revenue cycle and payer markets teams. Along with others throughout the company. Next slide.

Our 7% revenue growth in Q4 also translated to 12% year over year growth in gross profit dollars and a 72% gross margin, that improved 300 basis points over last year. This year over year improvement in gross margin partially reflects improvements in average revenue per test as well as overall lab efficiencies. Adjusted operating expenses increased year over year and were driven primarily by greater investment in R and D and the timing of incremental marketing spend.

We continue to focus on striking the right balance between investment for future growth and profitability. As we generated a third consecutive quarter of positive adjusted EPS reporting $0.03 in the fourth quarter. It's a testament to the health of the underlying business that we were able to deliver a strong bottom line performance while still absorbing the incremental investment in R and D. Next slide. The profit and cash generating potential of the business are also highly With $11,000,000 of adjusted EBITDA for the fourth quarter, and $40,000,000 for the full year. We also finished Q4 in a strong liquidity position with $158,000,000 of total liquidity from a combination of cash and cash equivalents, and availability under our revolver, We saw sequential increases in cash and cash equivalent balances from Q3 to Q4, and delivered adjusted free cash flow of approximately $10,000,000 in Q4 as well. During the fourth quarter, we also determined that the previously recorded $21,000,000 contingent payment to RavGen which was to be paid out beginning in 2026, was no longer probable. We therefore reversed the accrual and importantly no longer feel that this contingent payment will impact our liquidity needs in the future. Next slide.

For the full year 2025, we reaffirm our financial guidance as previously issued in January. With a revenue range of $840,000,000 to $860,000,000 a gross margin range of 69.5% to 70.5% and adjusted OpEx of between $575,000,000 and $595,000,000 This results in positive adjusted EPS of between $0.07 and $0.11 for the full year 2025. We are also targeting adjusted operating cash flow of between $20,000,000 and $30,000,000 While we don't guide on a quarterly basis, we wanted to set appropriate expectations for the first quarter of this year. We anticipate generating first quarter revenue between $196,000,000 and $2.00 $4,000,000 As a reminder, we had a total of $7,000,000 of benefits in Q1 of twenty twenty four. From a combination of change of estimates, and an unusual payer markets win, from a payer retroactively granting coverage of one of our products. Those make for a more difficult growth comp in Q1 of this year. We also anticipate a first quarter adjusted EPS loss of between $0.04 and $0.08 Now let me turn the call back to Paul.

Thanks, Scott. I'd like to close by saying thank you to our Board of Directors for the opportunity to serve here at Merriametix. The past four and a half years. To my colleagues in the industry, and to everyone in the investment community on the line today, helping me to learn advanced diagnostics and your advice over the years. And most importantly to my Myriad teammates for their commitment and friendship as we work together to reset Myriad Genetics culture, our foundation for continued growth, innovation and value creation for all of our stakeholders. I'll now pass it back to Matt for Q and A. Thanks, Paul. And as a reminder, during today's call, we use certain non GAAP financial measures A reconciliation of the GAAP to non GAAP financial results and reconciliation of GAAP to non GAAP financial guidance can be found on our earnings release and under the Investor Relations section of our website. Now we are ready to begin our Q and A session. To ensure broad participation, we're asking participants please ask only one question and one follow-up. Latanya, we are now ready to address the Q and A portion of this call.

Certainly. And our first question will be coming from Doug Schenkel of Wolfe Research.

Your line is open Doug.

Hi, this is Madeline Mollman on for Doug.

Just wanted to touch on the operating expense. On the 25% increase in R and D spend, should we assume this is primarily allocated towards clinical evidence generation for Precise MRD? And given this increase, is it reasonable to assume that SG and A would decline year over year? To align with the overall OpEx guidance for 2025? And then are you still targeting a South Basin thousand basis point SG and A reduction by 2026 versus 2023.

So, yes, the quarter definitely reflected Our acceleration of our investments clinical studies in advance of the launch of first gene, and precise MRD where we're continuing to be excited about the studies that should come out this summer. As referenced earlier in the call and in the earnings release, we've made certain changes in operating cost model to reflect the UnitedHealthcare payment changes.

So across commercial, SG and A and R and D. But I think what you will see is a 25% increase in R and D support future growth. About an 8% increase in our technology spend and belt tightening elsewhere in the organization for an overall pretty modest 3% increase Scott, I think we're forecasting year over year. So So I think that just reflects our ongoing discipline about operating expense management. Dealing with UnitedHealthcare change pragmatic way. But reallocating our investment dollars for future growth Great. Thank you. Our next question will be coming from Matt Sykes of Goldman Sachs. Matt, your line is open.

Hi, this is Will Rybmeier on for Matt. Thanks for taking our questions today. Just wanted to shift over to hereditary cancer. With the unaffected markets still around 10% penetrated, you mentioned some good traction in your breast cancer risk assessment program recently.

You talk a little bit more about the progress you're making in that unaffected Myriad? And the runway you're seeing for sustained growth there?

Yes.

As we said in the call, we think that that is a real sweet spot for Marriott. We think we have competitive advantage with our breast cancer risk assessment program. And we are gaining traction and a large part a lot of that EMR integration that we talked about will help fuel that. I think but as we also mentioned, as you can imagine, switching workflows is especially in the unaffected market where it requires a lot of patient education, it requires gathering family history, there's a lot of ancillary parts other than just ordering the test.

But we see a lot of future growth. And as you mentioned, it's only 10% penetrated.

And so that is definitely an area that we're excited about moving forward in the 2025, not to mention as Sam mentioned, the 50,000,000 women who really benefit by getting hereditary cancer testing.

That's helpful. Thank you. And then just a follow-up. Mentioned some opportunity from the recent market dislocation in that space. Has that been playing out for you to start the year? And how big of a tailwind could those share gains be throughout the year?

Thank you.

So as we said last quarter, the integration with LabCorp really just sort of happened here in January. In terms of potential impact for customers. LabCorp does a fine job, but that certainly presents an opportunity for people that are looking for a different experience The Ambury acquisition by Tempest just occurred a couple of weeks ago. And so typically, these kinds of changes in the marketplace take several quarters to sort of play out. But they do provide an opportunity for us given our value proposition about reliability, consistency, accuracy, fast turnaround times. To gain share in these markets, particularly in hereditary cancer. Our next question will be coming from Tijis Savant of Morgan Stanley. Your line is open. Hi. This is Madison on for Tejas. Just want to start off as we look out to the next year, how should we be thinking about revenue phasing And is there any seasonality we should be keeping in mind and just giving us maybe a little bit of a sense of waiting between first half and second half?

Yes. I mean, generally, I would say we made some comments on the call about of the year based on some of these initiatives, including accelerating ramp from EMR. So that I think will wait a little bit more heavily towards the second half of the year.

Other than that, I would say, bear in mind some of the typical seasonality that we see as a business and we have talked in the past about, for example, Q3 being a relatively lighter quarter and Q4 being a relatively stronger quarter.

Yes. Q2 and Q4 are typically where we see a little bit more amount.

Got it. Okay. That's really helpful. A bit of underperformance due to the to the disruptions in Europe, given the AstraZeneca decentralization of their product. Was just wondering if you could kind of speak to the trends you're seeing there now from My Choice and what assumptions you have baked into the guide for how the test should perform during the year?

Yes. I would say that most of that change is behind us. And so we expect to see stable to modest growth of My Choice going forward. The thing that we're the most excited about My Choice is expansion to other where we're making progress. To expand beyond ovarian to breast and prostate much bigger TAMs And so so very, very little in terms of growth in 2025 is based on My Choice. So the expansion of guide expansion of indications really set us up well for bigger growth in 2026 and 2027.

Got it. Okay. That's really helpful. Thanks so much.

And one moment for our next question.

Our next question will be coming from Subbu Nambi of Guggenheim. Your line is open.

Hey guys, this is Thomas on for Subbu. Just one on Polaris. So thinking about NCCN guideline updates and the confusion in recent months, Just curious where your focus is with Polaris today and where can you add the most value this year for growth in that test?

Yes, I think there's a couple of things. So number one, we continue to work with our KOLs as we mentioned the call, as well as those that are in charge of writing the guidelines to potentially get that removed. So I think that's sort of step one. I think step two, as we said, we are increasing our investments across marketing, medical affairs, KOL engagement, across the board because we're excited not only about where our product sits today, but as well as the announcement that we made with Pathomic. Our ability to bring the pairing together of AI as well as Polaris And then as we also mentioned, also within those guidelines was our ability to bring MyRisk precise tumor also to the table. So we see this as an area that we're going strongly invest in and we expect growth in the future.

Great. Thank you.

And then my second one is on GeneSight. So over the last couple of months, Myriad Myriad it a point to get out in front of investors and customers following 24 decisions that didn't go your way.

Curious if you can share what that time has been spent in terms of where you're spending your attention on your sales force, Or is it being more customer facing? Or is that time spent in front of commercial payers?

And then where have you seen the most benefit given the situation and where will you continue to aim your focus this year? Let me clarify. So the sales force hasn't changed its focus at all. So the sales force remains completely focused on those providers. That are treating mental health patients and they've been continuing to do that. Which is why the GeneSight demand continues to remain strong, why they're the market leader and also unfortunately because of the mental illness crisis that is happening today. Internally, as an executive team, we've been working with United We've had our different medical affairs teams working on data data evidence generation as well as our government affairs team working with So two very completely separate things and we think that's the way it needs to be so that we can remain focused and we can make sure that the patients who need GeneSight continue to get GeneSight while we continue to work through this.

Yes. Maybe to uplevel the answer a little bit, As Mark stated, and I think sort of implicit in your question, we continue to see strong demand for GeneSight. And so our market approach really hasn't changed. But we continue to see is the opportunity to mitigate the UAC policy change again, putting aside our continued work with UAC UHC to carve out or reverse that policy, is our biomarker legislation and our advocacy efforts there, which again we're investing more in time and energy in. I would just underscore sort of two things. We have not seen as we sit here today on February 24, any effect on this with respect to GeneSight volumes and we have not seen any impact on our Polaris volumes because of some of the confusion around NCCN guidelines. And in fact, as Mark stated, the underlying strategic premise and Sam spoke to of our ability to bring a comprehensive set of offerings in prostate cancer out of places you is really the future opportunity in this company that we're most excited about. Great. Thank you.

Our next will be coming from Tycho Peterson of Jefferies. Your line is open. Hey, thanks. I just want to go back to Polaris for a minute.

I mean, can you maybe walk through the exact steps you think you need to take here to get to level 1b in guidelines? And do you think this is viable? Is there a timeline on this? Can you I know you don't guide for Polaris, but can you actually give us some sense of what you've baked into numbers just given all the moving pieces around Maybe I'll take the first part, Mark, you can take the second part.

As it relates to getting Simon level one evidence, I think we've opened about it. One of our challenges has been access. To the samples that are needed to get that designation. Partnership now with Pathillic, who has this deep seated set of relationships, they started with prostate cancer and we are excited and we're seeing receptivity to working with us when you have the combination of clinical collaboration, which includes not just molecular, which is our piece of Polaris, but combined with the AI element that Foamix brings. So haven't quantified yet, give us just a little bit of time. We announced the collaboration formally this morning, but we are confident that the timelines which we have we've been working under are going to be accelerated. We look forward sharing more of that with you in the upcoming upcoming months.

As you said, Tycho, we don't guide at the individual product level, but what I can tell you is that we are expecting growth revenue and volume growth from ProLares in 2025.

Thank you. And our next question will be coming from Sung Ji Nam of Scotiabank. Your line is open. Hi, thanks for taking the questions and congrats to Paul, Sam and Mark. I'll just ask my questions together. [indiscernible] we're hearing more and more about these kind of AI enabled test technologies, capabilities, etcetera. So just kind of curious, with this exclusive partnership with PathSOMIC, why is PathSOMIC the right partner? Is the multimodal testing approach pretty unique to what you guys are trying to do And then what do you think differentiates the different AI technology platforms out there? Is it just the access to the amount of data patient data that you have or is it just some sort of differentiated technology, AI technology platform that's kind of provides the competitive advantage? Thank you.

Yes. Thank you very much for the thoughtful question. I'd start off by saying, by the way, we've been employing AI in various parts of operations for a long time, including a lot of our pipelines for Variant calling and so forth. But to your question, why the FoamIC, what really gets us excited is we were doing our diligence to look at potential partners is really related to the fact again, I'll restate the filmics started with prostate cancer. That's where they have deep roots. If you look at the the ophthalmic team, there are a number of folks this is what they've done for their entire career. Beyond that, the established relationships that they have with leading members, institutes that are 100% focused on prostate cancer that gives not only the ability to access the samples, but it also gives once again a broader network for 100% focus on prostate. So for us, it's the combination of that together with the IP position that as we looked at what they have, which we believe is strong and gives us together the freedom to operate and to build on. And we've been impressed also haven't talked about this yet today, The actual product, the way it will be brought to Myriad, we'll be able to start from H and E staining.

And as you might know, in pathology, H and E staining is the most foundational way being able to start from those slides digital images to then be able to bring proprietary AI algorithm for the analysis and interpretation which can all be in the partnership, which Myriad will then be able to handle. Leveraging our commercial channel and our customer service. We think that combination with our channel is what really what really allows us to feel confident. One further thing we've been spending time looking at options and opportunities for some period of time, including doing pilots with Pathelmics to gain the confidence that they are the right partner. So we couldn't be more thrilled with Rajat, the CEO of that team looking forward to a very exciting partnership, which we'll be able to share more about in the coming months.

Great. Thank you much. Our next question will be coming from Bill Bonello of Craig Hallum. Your line is open.

Hey guys, thanks for taking the call and also congratulations Sam and Mark and best wishes to you Paul. Thanks, Bill. I guess just a question on the CEO transition. Which isn't necessarily surprising given the timing of when you brought Sam and Scott on and you've been asked about it a lot, I think, over the course of the last year. But But maybe you could give us some sense of Why is now the right time or maybe if I ask it a a little bit [indiscernible] Why is it not the wrong time?

Right now.

Well, it certainly would have felt a lot better before the United decision.

Bill, the truth is that Sam has done an exceptional job here as is Mark. And there's always more work to be done. There's always more opportunity. But this was a personal decision for me and my family and I've got an opportunity to join Cressey and Company as a managing partner, which is not typically what an operator like me gets to go do for his last chapter. And so that's really what drove the timing My confidence in our strategy in this team, in the platform that we have built, the opportunities that we have are significant. And so never a perfect time, but it was the right time given the opportunity that was presented to me personally. And the significant runway that Sam and Mark and the rest of the team have Okay.

All right. That's helpful to understand that it was sort of driven by the timing of your opportunity as well. [indiscernible] go ahead.

No, yes, I mean, that's really was what may have been a year from now or something like that. Was driven by the the opportunity today to pursue this opportunity for myself and for my family. [indiscernible] thank you. Sure. Okay. Appreciate that. And then maybe just in terms of the Q1 commentary, obviously, it wasn't that long ago that you updated your full year guidance and I get it was early in the quarter, but you kind of had every opportunity to to talk about Q1. I guess I'm just trying to get a a feel for this. I mean, are you characterizing Q1 as a as a typical Q1 or some of the the commentary I heard over the course of the call made me feel like maybe the year isn't getting off to quite as good a start as you would have hoped it was. So if you can just kind of characterize that a bit?

Well, just to clarify, I'm sorry if I misunderstood your question, but but we had made previously comments about the full year. We had not previously made any comments about Q1 expectations. That's what I said.

You had You could have, but you didn't.

Yes. I mean, I think it would have just been premature us to do that quite frankly. But really, if you go back to the comments that I made, one of the areas that I flagged was that we did have a fairly significant favorable out of period in Q1 of last year. And so certainly there's always a possibility that you could get a repeat of something like that that continues to to provide a tailwind, but where we sit today we just feel like that is going to make it a more difficult comp as And then obviously we're still ramping in some of the other areas that Mark highlighted during the call.

Okay. So I mean in terms of if the year is getting off to sort of how you hoped it would, I mean the comp was always there. So just curious how you characterize that going relative to your Yes, we've reiterated our full year guidance, so nothing has changed in that or a And as we said, we have been expecting a ramp that would accelerate throughout the year.

Nothing has changed from when we gave initial guidance in our views of the year, or quite frankly the seasonality that we typically see in the quarter. You have co pays and deduct If you look back over the last couple of years, Bill, as we talked about earlier on the call, you typically have Q1 and Q3 seasonality.

Yes, I get that. And obviously, nobody brought their consensus numbers down after your guidance and so that that's part of the disconnect there.

Well, the fact that half of the EMOs have not updated their consensus numbers is a little bit of a challenge. But yes, we've got to scratch our heads about that.

Try initiating into that. And one moment for our next question.

Our next question will be coming from Puneet Souda of Leerink Partners. Your line is [indiscernible] Hey, Sam. Yes, thanks for taking my question.

Working with you here.

Thanks. So listen, so my question is really Looking forward, just diagnostics has been relatively spared so far. Fingers crossed, just given all of the concerns out there. But just and questions out there, but just can you elaborate a little bit on the Medicaid exposure and just trying to understand a risk would that be if new administration pursues some Medicaid spending cuts? Yes. If you think about Medicaid spending cuts as a consequence of block grants or anything, and where our Medicaid reimbursement comes from it's mainly going to be in prenatal and that is not historically where and I've been on the other end of Medicaid cuts in many other sectors, not where state legislatures go. So look, there's a lot of questions in terms of policy right now.

But when we look at the distribution of our revenues in terms of Medicare commercial and Medicaid and where in our products the Medicaid revenue falls We don't think we have a lot of exposure to Medicaid block grants or some other changes in Medicaid reimbursement.

Got it.

And then maybe first time, I mean, just looking at the portfolio, can you maybe just elaborate on how are your prioritizing investments? And again, when we're thinking about potential opportunities, there's ACOG and for NIPT, other things that could [indiscernible] the headwinds that you're seeing in the marketplace. So maybe just elaborate what are some focus areas for you investments wise?

Thank you, Puneet. That's a great question. And as I mentioned at this point, I feel privileged that I've been an important part along with Mark and Paul and Scott and others of developing our strategy in areas of focus, right? So So in the near term, at least, there is no intention of changing strategy or focus. You're right, when you talk about we are excited, we have already developed our expanded carrier screening for Sight Universal Plus product. So we're ready to catch the wave, if you will, when ACOG guidelines are updated. That's exciting for us.

And oncology remains another probably at the heart of the company still a great opportunity to build on the cornerstones that we have and it's not just MyRisk, it's my choice. We are the HRD Gold standard. And we're looking at other opportunities to take HRD broader into the market. We announced with Illumina, I think a few months ago, how it will get integrated into their TSO kits as well. But really it's serving the continuum of cancer care. I'll go back to that, right, really filling out those goals standard positions with new offerings which allow us to look at therapy selection with precise tumor to build on that, to get a liquid solution for therapy selection to market in 2026 as well. And of course, there is continues to be a lot of real engagement and work on MRD. Again, our first indication that we're going to bring a product to market is going to be breast cancer. And we have nearly 20 different clinical studies in MRD that are underway and a total of more than four thousand patients that either are in the process of being enrolled. And since you look at multiple data points, the journey of a patient looking at remission and relapse, we're talking at over 30,000 data points So the focus there and then the opportunity again is really about the continuum of cancer care and the partnership like that we announced with the filmic, which we're very excited about complements what we have to give us a solution where honestly we were not participating already, right?

Excuse me, we were not today post radical prostatectomy. So we're going to have a solution there by the end of twenty twenty five. With our partnership, very excited about that. And just kind of a foreshadowing, I think I mentioned it in my prepared remarks, We understand that along with the great organic work that we do that there's opportunities to get to market deep partnerships. So Pathillmik is a great example but there will be more to come that allows us to accelerate the path that Myriad been on organically.

Our next question will be coming from Ben Mi of Stephens.

Hi. Thanks for taking the question.

This is Ben on for Mason. So I just wanted to start with the launch of Prequel. At eight weeks there. I was hoping you'd be able to provide some commentary sort of on what you're hearing from the docs there, just really how that adoption market reception has been?

Yes. Let me just frame it by. We launched it in November of last year. So we're still in early innings, but as I called out on the call, one of the keys within that space is that first OB visit is typically at eight weeks. So historically, when you've got a 10 w test or you got a 12 w test, that kind of disrupts workflows it's not the best for the patient and certainly isn't the best for the provider. So we've seen a lot of excitement about it. And it is something very unique because of our Amplify technology. So Prequel was always sort of one of the best tests out there.

So now that it is at eight weeks, we're seeing a lot of acceptance. And you will hear more from us in the upcoming quarters. It's just still a little early for us to really comment. And get into more details.

Okay, got it. Thank you.

And I believe you've played sort of in 2025 double digit growth in hereditary cancer testing volumes, and it guided stable ASPs there.

One can you confirm this? And then with some of the initiatives that you I don't think we've guided we haven't guided to specific [indiscernible] numbers We Scott has talked about stable ASPs and hopefully continued contribution there, a couple of percentage points if we're continue to execute.

But we don't guide on specific volumes for any products.

Got it. Thank you.

Our next question will be coming from Tycho Peterson of Jefferies. Your line is open. Tycho, your line is open. Yes. Thanks for taking the follow-up. Just a question on the LRP. The language here is changing a little bit. You're going from 12% to double digit revenue growth.

You maybe comment on that?

Well, we took a $45,000,000 run rate hit for United. So that kind of knocked us back a little bit. So and GeneSight has been a big contributor to our growth 23% this past year.

So we still have a long term growth objective of 12, but we're thinking intermediate term, getting back to double digit in 2025 and growing from there.

Yes, I was commenting specifically on the 2026 and beyond guidance. That you have outlined?

Again, We'll be launching new products in 2026, but you are correct. We have because of the contribution of GeneSight and because it will be early in the launches of first gene and PRECISE MRD, [indiscernible] Yes, we have modified that to double digit, call it 10%.

As opposed to 12 Obviously, with our expectation that we can get back there quickly, But we were certainly on that path to that and beyond. Before we sustained the United piece.

And I just want to underscore that we continue to work with United on what we think was a error in their policy making process here.

And as Mark talked about, we'll continue to submit clinical evidence and engage with them And hopefully, certainly by the end of the year when they revisit their policy will have submitted two or three different studies that underscore the value proposition of gene sighting and quite frankly get a at a couple of the points that people have criticized vis a vis the PRIME study and other things. So I would now like to turn the conference back to Matt for closing remarks.

Okay. Thanks Latanya. This concludes our earnings call A replay will be available via webcast on our website for one week. Thank you again for joining us.

And have a good afternoon.

And this concludes today's conference call. Thank you for participating. You may now disconnect.