Veracyte - Earnings Call - Q1 2025

Executive Summary

• Q1 2025 delivered total revenue of $114.5M (+18% y/y) with testing revenue of $107.3M (+19% y/y); GAAP diluted EPS was $0.09 and non-GAAP diluted EPS was $0.31, with adjusted EBITDA of $24.7M (21.6% margin).
• Results beat S&P Global consensus: revenue $114.5M vs $111.0M estimate and non-GAAP EPS $0.31 vs $0.205 estimate; GAAP EPS $0.09 not directly comparable to “Primary EPS” consensus *.
• Management reiterated FY2025 testing revenue guidance of $470–$480M (12–15% y/y; 14–16% ex-Envisia) and raised adjusted EBITDA margin guidance to 22.5% from 21.6%.
• Catalysts: Decipher Prostate metastatic launch (limited access now, broad in June), evidence momentum in urology and MRD; watch for Marseille (France) exit process impacts on product/biopharma revenues and gross margin in Q2.

Note: Values retrieved from S&P Global.*

What Went Well and What Went Wrong

What Went Well

• Eleventh consecutive quarter of ≥20% testing volume growth; Decipher volume +37% (~22,600 tests) and revenue +33% ($66.6M); Afirma volume +10% (~15,500 tests) and revenue +6% ($38.3M).
• Margin execution: GAAP gross margin 69% (from 65% y/y), non-GAAP gross margin 72% (from 68% y/y); adjusted EBITDA margin 21.6% (from 14.9% y/y).
• Strategic progress: limited access launch of Decipher Prostate for metastatic patients (Medicare-covered), target broad orders in June; strong evidence pipeline (AUA/ESMO/ASCO GU, GRID); MRD platform data showing earlier recurrence detection vs imaging (median 93 days earlier).

Quote: “We delivered a healthy adjusted EBITDA margin of 21.6%… and ended the quarter with a strong balance sheet” – CEO Marc Stapley.

What Went Wrong

• Afirma revenue growth lagged volume due to 2024 prior-period collection tailwinds and lingering claim adjudication from a lab benefit manager coverage error; testing ASP down ~3% y/y to $2,818 (≈$2,800 ex-PPC).
• Marseille subsidiary bankruptcy process to conclude by year-end; expect lower fixed-cost absorption and biopharma/product headwinds near-term; annual SAS loss ~$20M and one-time cash costs ~$15M flagged previously.
• Q2 outlook embeds sequential step-down in gross margin from Marseille and consumable timing; product revenue ~$2.5M and biopharma/other ~$1.5M as SAS winds down.

Transcript

Operator (participant)

Thank you for standing by. Welcome to the Veracyte First Quarter 2025 Financial Results Webcast. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Shayla Gorman, Senior Director of Investor Relations. Please go ahead.

Shayla Gorman (Senior Director of Investor Relations)

Good afternoon, everyone, and thank you for joining us today for a discussion of our first quarter 2025 financial results. With me today are Marc Stapley, Veracyte's Chief Executive Officer; Rebecca Chambers, our Chief Financial Officer; and John Leite, our Chief Commercial Officer, who will join us for Q&A. Veracyte issued a press release earlier this afternoon detailing our first quarter 2025 financial results. This release and a copy of the presentation we will review during the call today are available in the Investor section of our website at veracyte.com. Before we begin, I'd like to remind you that statements we make during this call will include forward-looking statements as defined under applicable securities laws. Forward-looking statements are subject to risks and uncertainties, and the company can give no assurance they will prove to be correct.

Additionally, we are not under any obligation to provide further updates on our business trends or our performance during the quarter. To better understand the risks and uncertainties that could cause actual results to differ, we refer you to the documents that Veracyte files with the Securities and Exchange Commission, including the most recent Forms 10-Q and 10-K. In addition, this call will include certain non-GAAP financial measures. Reconciliation of these measures to the most directly comparable GAAP financial measures is included in today's earnings release accessible from the Investor section of Veracyte's website. I will now turn the call over to Marc Stapley, Veracyte CEO.

Marc Stapley (CEO)

Thank you, Shayla, and thanks, everyone, for joining us today. I am pleased to share our Q1 results as well as updates on our growth drivers and other key initiatives, all of which are the result of our team's daily focus on serving patients globally. Q1 total revenue of $114.5 million, or 18% year-over-year growth, was fueled by testing revenue, which grew 19% year-over-year, or 21% after adjusting for Envisia. With both Decipher and Afirma delivering another strong quarter of double-digit volume growth at 37% and 10% respectively, we are encouraged by the ongoing durability of our core testing business and are confident in delivering on our expectations for this year and beyond, despite the challenging macro environment. We delivered a healthy adjusted EBITDA margin of 21.6%, meaningfully higher than we expected, and ended the quarter with a strong balance sheet comprising $287 million of cash and short-term investments.

As you know, we are focused on a number of strategic initiatives, including growing our existing tests, Decipher and Afirma, expanding across the care continuum with our minimal residual disease platform, expanding internationally, and solving novel cancer challenges with innovative products like our Percepta Nasal Swab. Today, I'm excited to share our progress and some new initiatives. Starting with Decipher, the impressive 37% year-over-year volume growth resulted in approximately 22,600 tests and revenue growth of 33%, with the driver of this difference being higher prior period collections last year. Encouragingly, we continue to see broad-based expansion across each biopsy NCCN risk category, with roughly similar growth in low, intermediate, and high risk. Further, this quarter, we saw both a record number of ordering providers up over 20% from the prior year and increased orders per physician.

While January and February were, as previously shared, seasonally lower months, March was exceptional, and that strong momentum continued in April. We believe these positive trends are a testament to the recent NCCN guideline update, as well as the excellent execution of our commercial and laboratory teams. Looking ahead, there are a number of activities that position us for sustained, strong double-digit Decipher growth. With meaningfully differentiated performance and an incredible body of clinical evidence, Decipher is already in a field of its own. At the recent AUA annual meeting in April, there were no less than 18 new abstracts presented across both Decipher prostate and bladder, including new data from the use of Decipher in clinical trials, as well as insights derived from the research-use-only GRID platform. We are also progressing across the care continuum with our Decipher prostate metastatic launch.

As of late April, Decipher prostate is available for use in the metastatic population on a limited basis and will be available broadly in June, meeting our expected launch timeline. The clinical validity and clinical utility for use in this patient population has been demonstrated in multiple prospective phase III clinical studies, including the results from the STAMPEDE trial presented at ESMO Congress 2024. Importantly, the tests will provide information to help clinicians determine which patients will likely benefit from chemotherapy and which will not, thereby avoiding unnecessary toxic side effects. One such case involves an older man who was diagnosed with metastatic disease. His doctor ordered the test to help guide treatment selection between doublet therapy, that is ADT plus ARPI, and triplet therapy with the addition of docetaxel. Although the patient is fit, active, and fully independent, his physician was concerned about adding the chemotherapy.

The Decipher prostate metastatic test will provide an additional data point for the physician and patient as they make the treatment decisions necessary at this critical phase of the disease, balancing the likely benefit with the impact on quality of life. This launch meaningfully expands the population appropriate for Decipher testing, serving an incremental 30,000 patients diagnosed annually and now addressing the entire risk spectrum of prostate cancer, further strengthening our confidence in the test's long-term growth trajectory. We have also continued our investment in digital pathology studies to assess the complementary benefits of the technology, as well as to ensure research collaborators have the necessary tools to further our collective understanding of prostate cancer.

In addition to the data presented at the 2025 ASCO GU earlier in the year, we have now scanned over 70,000 slides from over 40,000 de-identified patients with outcomes data, solidifying our digital pathology capabilities with advanced AI models that incorporate long-term outcomes and may ultimately complement the prognostic power of our Decipher test. Further, we have recently made our digital pathology services and associated AI models available to research collaborators to advance the science in this field of combined AI-based imaging and molecular analysis. Looking ahead with the most prolific and growing body of real-world evidence, NCCN guideline recommendation, and now the expansion into the metastatic patient, Decipher's opportunity to significantly penetrate the nascent and growing prostate cancer market is even clearer. We look forward to continuing to drive meaningful growth for the Decipher franchise for years to come.

Moving to Afirma, volume growth continues to be strong and increased, as I mentioned previously, 10% year-over-year, resulting in approximately 15,500 tests. We were encouraged to see higher year-over-year utilization per account again this quarter, which gives us confidence in the go-forward durability of the Afirma franchise. Revenue growth was lower than volume growth, driven by the prior period collection benefit in 2024, as well as the negative impact of a lab benefit manager's mistaken coverage policy change last year. While the mistake was quickly corrected, it took longer than anticipated to be worked through the respective payer systems and therefore reduced collections below the amount estimated over the course of 2024. This has been fully resolved; however, we are still adjudicating some of these claims, and the full return to normal rates may take another quarter or two to be reflected.

With the volume strength we're seeing, as well as indication expansion and the product enhancements we've delivered, our confidence remains strong that Afirma will continue to gain in both share and penetration. We expect the first presentation of independent analysis leveraging the GRID database later this month at AAES and look forward to sharing additional publications and poster presentations that advance thyroid nodule and cancer research. As with Decipher, the flywheel of research and evidence around the test is representative of the power of the Veracyte diagnostics platform and will enable efficient evidence generation and insights that will help expand patient treatment and ultimately, we expect, will drive continued growth. While on the topic of Afirma, I'm excited to share key advancements that we are making in our CLIA lab. Over the past two years, we have invested in improving the efficiency of our testing business.

As part of our overall cost reduction roadmap, we have been working to transition Afirma onto v2 of our Veracyte transcriptome, running on the latest and most cost-effective sequencing technology. We will first launch Afirma on the updated assay this summer. This transition enables cost reductions that are designed to offset normal reagent list price increases we might experience in 2026 and beyond, while also helping to mitigate unpredictable tariff impacts and to potentially enable us to reinvest in organic opportunities to serve more patients. I'm also excited to be able to announce today that we have decided to launch Prosigna as an LDT for the U.S. breast cancer market, given the tremendous opportunity we see ahead. There are over 300,000 patients diagnosed annually with breast cancer in the U.S., and approximately 225,000 of those have early-stage hormone receptor-positive disease and would be eligible for the test.

Prosigna, which is based on the well-known, well-researched, and scientifically respected PAM50 signature, can provide physicians and their patients with additional data around the biological classification of the cancer and the risk of recurrence to help inform treatment decisions. While Prosigna is currently available only as an IVD on the end cancer platform, the Prosigna LDT will be run out of our CLIA lab using our brand new v2 Veracyte transcriptome. Commercial availability will begin in mid-2026, and we believe key data readouts, some of which we'll see in the next few months, will support adoption of Prosigna, augmenting Decipher and Afirma growth in the near to midterm. As always, we are focused on driving evidence for the test through the Veracyte diagnostics platform to support continued research for patients navigating the stressful diagnosis and associated treatment paths.

Moving to the other growth drivers mentioned previously, I would like to start with our commitment to serve more of the patient journey through MRD and recurrence testing. Our MRD approach is differentiated in that it is whole genome every step of the way, including the initial baseline sequencing, followed by the sequencing of serial testing samples. This approach is backed by our fundamental belief that more data drives more insight, more clinical evidence, more payer coverage, and therefore more durable adoption. We have made good progress in advancing our MRD platform for our first indication, muscle-invasive bladder cancer. This indication will leverage our strong Decipher channel that serves urologists and radiation oncologists. In March, we submitted our tech assessment to MolDX and remain on track for commercial launch in the first half of 2026 once we have reimbursement in place.

While we are initially focused on MIBC, beginning in 2027, we plan to deliver indication expansion annually, serving more patients across more indications. Building out the clinical evidence behind our platform is key to our go-to-market approach. We are excited to share that our MRD platform was selected for the important UMBRELLA trial being run out of Gustave Roussy on approximately 700 patients with non-small cell lung cancer, colorectal cancer, soft tissue sarcoma, and pancreatic cancer, as well as leveraging MRD-positive status to direct IO therapy. UMBRELLA investigators chose our MRD platform given its tissue-agnostic analytic validation, which enables a trial to include multiple tumor types. The data from some of these indications will be pivotal as we look to expand our test beyond MIBC in the future.

Further, strong performance data from the multicenter interventional TOMBOLA clinical trial was presented at the annual European Association of Urology (EAU) Congress in March 2025, supporting the accuracy of our whole genome sequencing-based MRD platform for MIBC. This data showed that our test had a higher specificity, equivalent, and outstanding negative predictive value when compared to a ddPCR approach and was able to detect cancer recurrence a median of 93 days sooner than standard imaging. Next, turning to our geographic expansion strategic growth driver, where we are committed to launching our test as IVDs to address patient needs outside the U.S., I would like to update you on the ongoing process with our French subsidiary, Veracyte SAS or SAS. As I had previously shared, Veracyte notified SAS that we were considering no longer funding their operations.

As a result, SAS engaged in consultation proceedings with the Works Council in France, while also seeking to identify one or more buyers for all or part of the SAS activities. In late April, Veracyte notified SAS that Veracyte definitively decided to no longer fund the entity, and accordingly, SAS filed a bankruptcy petition shortly thereafter. We remain confident in a full resolution of SAS proceedings by the end of the year, at which time Veracyte would no longer own or operate the Marseille facility. We are focused on maintaining Prosigna supply to help minimize patient impact as much as we can. SAS and its financial advisors are working to identify potential buyers for portions of the business, and any sale would be handled by the commercial court as part of the proceedings.

Our decision to no longer fund SAS does not reflect a change of strategy or our commitment to global expansion, but this process does inevitably impact our IVD product development timelines, as previously shared. Importantly, we have made significant progress on these products. For example, our Decipher PCR IVD product is bridged and partially validated with a single pilot lot, thereby meaningfully reducing technical risk. We are now in the process of reinitiating that development program in the U.S., working with a U.S.-based contract manufacturer, and expect to complete our joint development and manufacturing work by the end of next year. Similarly, we now expect to complete our Prosigna NGS IVD product development work by the end of 2026 as well, working with a different third-party contract manufacturer.

We continue to work with TÜV Rheinland, our notified body, and are in the process of resubmitting Prosigna nCounter to their North America division. These steps will all be necessary to launch our IVD products in Europe, along with gaining reimbursement country by country, which, as always, will take some time. Importantly, we don't believe this change in development and certification timelines meaningfully impacts our revenue models for the next five years, and in fact, we expect that any delay of IVD product revenue will be more than offset by the launch in the U.S. next year of our Prosigna LDT. Our last growth driver is solving new cancer challenges with innovative products like our Percepta Nasal Swab, to which we remain very committed, as evidenced by our major investment in clinical evidence.

Lung cancer is the leading cause of death worldwide, and early detection and management is key to reducing mortality and improving outcomes. Percepta Nasal Swab is a simple, non-invasive test that assesses lung cancer risk in patients with a detected lung nodule and smoking history so that the right patients get the right intervention at the right time. In the first quarter, we were pleased to publish nasal swab analytical validity data in BMC Cancer, demonstrating the robustness of the test. This publication, as well as completion of the prospective NIGHTINGALE study, are key steps in our effort to bring this important test to patients. With a target of 2,400 patients, NIGHTINGALE is now close to 95% enrolled, and with just over 100 patients left to register, we are now confident in predicting completion of enrollment in the third quarter.

We will be able to commence the important follow-up and data analysis leading to publication and ultimately reimbursement. To summarize, at Veracyte, everything we do is to advance our vision of transforming cancer care to improve patient lives all over the world. Leveraging our unique Veracyte diagnostics platform, we deliver the deep insights that physicians can rely on today while continuously fueling the flywheel of evidence needed to solve new cancer challenges tomorrow. Q1 was another amazing quarter, demonstrating our capabilities to this end. We saw incredible volume growth across our core testing business, meaningful strides in our cost reduction roadmap, progress on our commitment to launch new clear tests starting with Prosigna LDT, and great progress across all of our long-term growth drivers during the quarter.

We have a rich and exciting portfolio of products in development over the next few years and beyond, and I'm confident these activities, as well as others we're working on, will enable us to serve even more patients facing cancer, ensuring we are living our ethos of patients as our purpose. With that, I will now turn to Rebecca to review our financial results for the first quarter, as well as our outlook for 2025.

Rebecca Chambers (CFO)

Thanks, Marc. As mentioned, Q1 was a strong start to the year as we delivered revenue of $114.5 million, an increase of 18% over the prior year period. Further, total volume grew to approximately 40,650 tests, a 22% increase over the same period in 2024. Testing revenue during the quarter was $107.3 million, an increase of 19% year over year, driven by Decipher and Afirma revenue growth of 33% and 6%, respectively.

Total testing volume was approximately 38,000 tests. Testing ASP was $2,818, down 3% compared to the prior year, and includes approximately $600,000 of prior period collections, or PPC. Adjusting for the impact of PPC, testing ASP would have been approximately $2,800, roughly flat compared to Q1 2024. Turning to the product line, first quarter volume was approximately 2,570 tests, and revenue was $3.6 million, up 1% year over year, as our actions to maintain continuity of supply over the quarter were more successful than anticipated. Biopharmaceutical and other revenue was $3.6 million, up 19% year over year, as SAS customers accelerated programs given Veracyte's impending financing decision. Moving to gross margin and operating expenses, I will highlight our non-GAAP results. Non-GAAP gross margin was 72%, up approximately 400 basis points compared to the prior year period.

Testing gross margin was 74%, up approximately 200 basis points, giving timing of material spend, as well as the benefit of automation and lab efficiency programs that we launched late last year. Product margin was 60%, up materially from the prior year period given higher cost absorption. Biopharmaceutical and other gross margin was 27%, up 18% year over year. Non-GAAP operating expenses were up 14% year over year at $60.5 million. Research and development expenses increased by $2.1 million to $15.7 million, given increased development spend and one additional month of personnel expense from our C2i acquisition as compared to the prior year period. Sales and marketing expenses increased by $0.8 million to $22.5 million. G&A expenses were up $4.5 million to $22.3 million, partially driven by billing and customer service hiring to support our scaling testing business and IT support for product development projects.

Moving to profitability metrics, our financial profile continues to be best in class, driven by our disciplined approach. In the first quarter, we recorded GAAP net income of $7 million and delivered adjusted EBITDA of $24.7 million, or 21.6% of revenue, well ahead of expectations as we benefited from our lab efficiency projects as well as the timing of project spend. Turning to our second quarter outlook, we expect testing revenue to step up sequentially. For gross margin, we're expecting a modest step down sequentially given lower fixed cost absorption at our Marseille site and the timing of consumable spend in our testing business. Based on the current SAS dynamic, we expect product revenue of approximately $2.5 million, while biopharma and other revenue is expected to be approximately $1.5 million.

Marc Stapley (CEO)

Moving to profitability metrics, our financial profile continues to be best in class, driven by our disciplined approach. In the first quarter, we recorded GAAP net income of $7 million and delivered adjusted EBITDA of $24.7 million, or 21.6% of revenue, well ahead of expectations as we benefited from our lab efficiency projects as well as the timing of project spend. Turning to our second quarter outlook, we expect testing revenue to step up sequentially. For gross margin, we're expecting a modest step down sequentially given lower fixed cost absorption at our Marseille site and the timing of consumable spend in our testing business. Based on the current SAS dynamic, we expect product revenue of approximately $2.5 million, while biopharma and other revenue is expected to be approximately $1.5 million.

Going forward, product revenue should remain flat sequentially as long as we are able to maintain continuity of supply for Prosigna on end counter and minimize customer disruption. For biopharma and other, once the SAS process concludes, most of this revenue will go away. Given our solid Q1 results, we are reiterating our 2025 testing revenue guidance of $470 million-$480 million. Due to our strong Q1 performance and the gross margin improvement projects we expect to benefit from in the second half, we are raising adjusted EBITDA margin guidance for the year to 22.5% from 21.6% previously. Also, we are estimating our 2025 GAAP and non-GAAP tax rate to be in the mid-single digits. In closing, we were encouraged by the performance of both Afirma and Decipher in the first quarter and the value we're delivering to both patients and clinicians.

With a robust set of growth drivers, including the recent launch of Decipher in the metastatic population and the upcoming launch of our Prosigna LDT, we are well positioned to deliver sustained growth in our business. Above all, we remain deeply committed to our mission of transforming cancer care and improving patient lives all over the world. We'll now turn to the Q&A portion of the call.

Operator (participant)

Thank you. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. We ask that you please limit your questions to one question plus one follow-up question. Please stand by while we compile the Q&A roster.

Our first question comes from the line of Subbu Nambi of Guggenheim Securities. Your line is now open.

Subbu Nambi (Managing Director of Healthcare Equity Research)

Hey, guys. Thank you for taking my question. There are two topics that I would like to cover. First, you are a management team that has not been timid in pursuit of portfolio optimization, whether it's moving out of businesses or adding new products via M&A. How do you feel about the portfolio as it stands today? Is there a desire to round out the portfolio in a way that would give you a broader menu similar to other companies in this area? Second, one question we get a lot is how to think about the pipeline value of Veracyte, MRD and nasal swab especially. How would you respond to those who believe the value assigned to those initiatives are limited? Thank you, guys.

Marc Stapley (CEO)

Yeah, thanks, Subbu.

Appreciate the question.

You're absolutely right. We've been very focused on portfolio management, making sure that the things that we are investing in have both the appropriate evidence, reimbursement, and the launch to the right time. We're not investing in things that don't have the ROI, and then adding to our portfolio, for example, by acquiring an MRD asset. If I kind of just remind everybody where we were, I mean, we started out as a company with a single product and a single indication, so Afirma for indeterminate thyroid. We've added not just new products, but also broadened and lengthened the indications that those products cover. For example, with Afirma, we've added TERT, and we're now working on the first of five.

With Decipher, which is an even better example of the expansion, it started out in RP, expanded to biopsy, and now is expanding to metastatic. Now Decipher covers the entire spectrum of patients with prostate cancer. I'd say number one is expand within the indication as much as you can given the leverage. Number two is expand the channel. You've seen us take our urology channel and expand that with a bladder test and soon to be MRD. The third would be indications. You've heard us talk a lot about adding lung as an indication, which we're very, very significantly working on. As we announced today, really adding breast as an indication in the U.S. next year as well.

Taking our MRD platform, and as we mentioned today, expanding the indications there, one a year starting in 2027 after we kind of proved this out with our launch in muscle-invasive bladder cancer. As I think about that portfolio, I think it's incredibly broad with a rich pipeline of new products to come. I couldn't be more excited about it. Could we continue to add more menu? Sure. As you can imagine, we work a lot on things like that, both organically and inorganically. If there were great opportunities, we would certainly pursue them, which is why we just announced what we're doing in breast, for example. To your second part of your question on the pipeline value, I mean, I agree with you. I think the MRD and nasal swab are not much in there today.

We're proving both of those out. We've got milestones. We've told you what the milestones are. MRD is the muscle-invasive bladder launch next year. First half in nasal swab is completing the NIGHTINGALE study and ultimately getting that product reimbursed and launched. Those are massive markets. If you think about it, in both cases, growing from zero in significant markets across multiple indications in the case of MRD. We've got differentiated products in both cases, and we've proven our execution capability. I think investors should look at our track record and evaluate those markets and verify it accordingly.

Rebecca Chambers (CFO)

Yeah. The only thing to add is I think historically those have been longer-dated growth drivers, right?

As we look at where we are today, here in May of 2025, we have multiple product launches coming up over the next 12-18 month period. I agree wholeheartedly with Marc on everything he said. The only thing I would add is the time is coming where these things are going to be super exciting and launched, and we will be able to demonstrate our execution in multiple areas besides just Afirma and Decipher.

Subbu Nambi (Managing Director of Healthcare Equity Research)

Hey, guys. Thank you so much for articulating that. I'll hop back in the queue.

Rebecca Chambers (CFO)

Thanks, Subbu.

Operator (participant)

Thank you. Our next question comes from the line of Andrew Brackman of William Blair. Your line is now open.

Andrew Brackmann (Equity Research Analyst)

Hi, guys. Good afternoon. Thanks for taking the question. Maybe I ask you to pick up on the last question there. You obviously do have these product catalysts and launches over the next coming quarters and years.

Maybe just big picture, can you talk about how you're ensuring organizational readiness, both commercially and operationally, for these launches? How do you sort of think about investment into some of the areas that you still need? What are those areas, and how much are you sort of willing to spend? Thanks.

Marc Stapley (CEO)

Yeah, it's a great question. Our first step is obviously to get these products to market and go through the product development. We talk about how much we invest in that, as well as generating the evidence, which is a key part of our engine, our Veracyte diagnostics platform, to make sure that we don't just launch products on the market that don't have the evidence to support adoption, reimbursement, and ultimately guidelines. All of this is coming together.

At the end of it, there's obviously a launch plan with the commercial activities all planned out around that. It's a very thoughtful launch plan. I'll let John discuss a little bit more of it since he's on the call with us today. We make sure that we don't invest ahead of the opportunity growing. We add, and you saw us do this with Decipher and Afirma. We add sales teams and commercial capabilities as we need it as we grow. John, you want to share a little bit more?

John Leite (CCO)

Yeah, thanks, Marc. I'll add to that just by saying you'll see that there's been great thoughtfulness in how we think about the analytical platform first. We mentioned today version two of our transcriptome. That's the underpinning of a variety of products that we're developing and launching.

Number two, with C2i acquisition, we mentioned from the very beginning, we really saw that as a platform play from which we could gain leverage and launch new indications rather quickly. It all starts in the lab. From there, I would say channel synergies are what we look at very, very carefully. With muscle-invasive bladder cancer, one of the selection criteria for that was that serves a market where we have leadership. We have very strong relationships with those ordering physicians. Beyond that, we're being very thoughtful and considerate as we add new channels, as would be the case with Prosigna and the LDT test here in the U.S. We'll do that in a very measured way, not taking on a big investment upfront, but looking to scale that over time as we see proportionate revenues.

Rebecca Chambers (CFO)

On the investment front, perhaps, Andrew, as both Marc and John mentioned, obviously the lab is a critical cornerstone of us being able, from an organizational perspective, to be ready here. I think we've previously mentioned, I know it's in our filings, that we have renewed the lease for both San Diego and San Francisco and are in the process of building out capacity in both locations that allow us to operate for the next five to seven years. From that standpoint, the lab is ready to go for all of these things once they're finalized in development. Obviously, both John and Marc cited that we parse into these commercial channels if they're net new. We will have some incremental investment on the R&D front to get all of these to market over the next 18 months.

That being said, we also are obviously always looking at our financial profile and ensuring that it is delivering upon what we have shared with you all. In any given year, things can swing a little bit one way or the other as we look for the next 18 months, though. Obviously, we're expanding our adjusted EBITDA margin guidance today, and that's a great, it's going in the right direction. Obviously, we think about balancing all of these things as we structure our P&L in any given year.

Andrew Brackmann (Equity Research Analyst)

That's great, [Keller]. Thanks for all that. Maybe just on Decipher today, Marc, I think you called out a 20% increase in the ordering physician base in the quarter. Can you maybe just tell us a little bit more about that 20% increase? Who are those doctors that sort of came on board? Are they sort of competitive wins?

Are they new to testing in sort of general? As you sort of think about the potential for additional doctors to come on board, where are we in terms of penetration into the overall ordering base that you see? Thank you.

Marc Stapley (CEO)

Yeah, thanks, Andrew. The commercial execution this quarter in Decipher has been yet again exceptional, setting new records. John leads that organization. I'm going to ask John to share a little bit about the makeup of that 20% growth.

John Leite (CCO)

Yeah, it's a bit of a mixed bag, Andrew. Thanks for the question. We're constantly running initiatives within our commercial strategy that focus on new physicians that are new to the test, or they're formerly ordering physicians that for some reason or another have kind of fallen off, that are familiar with the test, but maybe their ordering rate has fallen off, and we've reactivated them.

We see great gains there. Some are entirely new to the business and have never ordered a genomic test before, so that would be pure penetration into the space. As you alluded, a good number are market share gains.

Marc Stapley (CEO)

On the penetration from an ordering perspective, I think the key there is obviously we are penetrating the larger accounts, and there is always going to be a long tail of smaller accounts. The penetration into the physician base, which is an extremely difficult number to measure, actually, in terms of who are the actual ordering physicians, but the penetration is very strong. Obviously, given that long tail as a percentage, you would expect it to be a little smaller than our overall penetration, which is, I will remind everybody again, about market, about 40% penetrated and Decipher about 65% share, but still very strong.

Operator (participant)

All right. Thank you.

Our next question comes from the line of Puneet Souda of Leerink Partners. Your line is now open.

Puneet Souda (Senior Research Analyst)

Yeah, hi guys. Thanks for the questions here. Maybe first on the guide, I just wanted to clarify the moving parts there. In terms of the number you delivered, I mean, you came in, I think, $4 million ahead of the street, but you're not raising your guide. There's Invizia, some impact in there. There is some of that. There is impact maybe from Marseille, and the biopharma is getting pulled out. Can you maybe walk us through those? Beyond that, how should we expect the Afirma growth? It looks like it's been low single-digit growth. Is that the right way to think about Afirma? Decipher as well within the context of the guide?

Rebecca Chambers (CFO)

Yeah, I'm happy to take that one, Puneet.

I just want to be very careful here. We're talking apples to apples and oranges to oranges. The first thing on the guide is recall the test. The guide is 470-480 for testing only. Everything we've looked at, the guide and—I'm sorry, the Q1 results were right on top of street estimates for testing. Where the beat came from was primarily biopharma and product, which are not—we don't have a total company guide right now because we don't have definitive clarity on the timing of the Marseille operation, which then impacts the total revenue, if that all made sense. I'm going to pause there and just make sure. Do you have any follow-ups on that before I move to Afirma?

Puneet Souda (Senior Research Analyst)

Yeah. No, that's helpful. Yeah. I know Afirma.

Rebecca Chambers (CFO)

Okay, great. For Afirma, we delivered 10% volume growth, 6% revenue growth.

About two-thirds of the delta between the two was tied to prior period collection in the prior year. A third was tied to the LBM impact that Marc mentioned. 6% revenue growth in Q1. We are still contemplating high single-digit revenue growth for the year. I think you might be looking at it with cytology, which we have said on the last call, cytology typically is pretty flat. We do not think about cytology in the same way. Cytology is a mechanism of getting samples, not necessarily a growth driver for us. When we think about Afirma, we are giving just the Afirma number, not including cytology.

Puneet Souda (Senior Research Analyst)

Got it. Okay. That is helpful.

On the Marseille side, can you just—you talked about gross margin impact because of the fixed cost, but can you just clarify how should we think about the—was there an OpEx impact as you continue to run this facility into 2025? What are the scenarios there? Is there a scenario in which it could take longer than the year-end of 2025?

Rebecca Chambers (CFO)

Yeah, I'm happy to take that and can have Marc opine. Yes, we had our typical run rate of OpEx in Marseille. We said with revenue, that was about a $20 million loss on an annualized basis. You can think about the quarterly impact of that as expected. Obviously, it was slightly less given the gross profit outperformance, but you're close enough if you just take—if you just take that impact.

With regard to the process itself, we have confidence that we will be done by the end of this year. Obviously, these things could take longer. I would not say that is a 0% probability, but all of our expectations, all of our advisors' expectations is that we are done with this by the end of the year. We had an important step today with the court accepting the application for bankruptcy. Everything seems to be tracking as planned.

Marc Stapley (CEO)

Yeah. Do not forget, if you think about it, Puneet, there are some one-time costs associated with this as well that we talked about last quarter and our estimates around that of a similar $15 million.

Rebecca Chambers (CFO)

That is a cash number. There will be non-cash impacts as well. Thanks for that reminder, Marc.

Marc Stapley (CEO)

Yep.

Puneet Souda (Senior Research Analyst)

Okay. Thank you. If I could just ask one last one on Prosigna.

You're launching that in the U.S. I just want to understand, is there something differentiating about the test? Because it is launching in a market that is well-penetrated. Oncotype DX has been in the breast market, well-established for a long time. You've got MammaPrint there too. Just trying to understand, how are you thinking about the U.S. market and the growth expectation for Prosigna?

Marc Stapley (CEO)

Yeah, thanks, Puneet. Yes, we do believe that the test is differentiated. I mean, as we always do, we base our business models on evidence generation. We alluded to the fact that we're expecting some data that supports the use of the test, the clinical utility, and the differentiation of the test.

It is the right time for us to launch that into what you correctly stated is a penetrated market, starting from zero, effectively zero for us in the U.S., and gaining some share there. John, do you want to add anything?

John Leite (CCO)

Yeah. It is obviously something that took a good bit of consideration from us. In Europe, it is a test that has gained some traction, especially amongst the key opinion leaders. It is, in fact, those thought leaders who have been driving much of the more recent evidence. It is on the backbone of that evidence that we are looking to gain share within the U.S. with our LDT test. Evidence is one layer of differentiation. The second is the playbook. It is not entirely unlike how we ran Decipher. Decipher was also a late entrant into the space.

Based on our product design, based on our philosophy towards evidence development and collaboration with key opinion leaders, based on our commitment towards evidence generation and guideline inclusion, Decipher has come up very quickly in terms of market leadership. That is what we are hoping to rerun with Prosigna as well.

Puneet Souda (Senior Research Analyst)

Okay. Thank you. Thank you.

Rebecca Chambers (CFO)

Thanks, Puneet.

Operator (participant)

Thank you. Our next question comes from the line of Doug Shankle of Wolfe Research. Your line is now open.

Colleen Babington (Equity Research Associate)

Hi. Thank you. This is Colleen on for Doug. We just have a question on the Decipher ramp for the balance of the year. It looks like ASPs came in around $2,950 in Q1. And our understanding is that the metastatic test will have similar ASPs as the biopsy-based test. With that in mind, should we keep ASPs flat throughout the balance of the year?

How should we be thinking about the volume growth trajectory this year and into 2026?

Rebecca Chambers (CFO)

Yeah, Colleen, I'm happy to take that. Recall, slightly more of the population for metastatic is Medicare, and therefore the ASP I would think is very slightly higher, but not materially so. On the counter side to that, we will not necessarily have coverage or contracting for the non-Medicare population. Those two things probably net out. I would love to be able to give you more details behind that, but in all honesty, it is a quarter-by-quarter play depending on mix. I think having around the same ASP, maybe drifting up very, very slightly over the rest of the year is reasonable. From a growth rate perspective, our full-year guide implies 19%-22% revenue growth.

Volumes, we are, as we saw in the first quarter, experiencing a prior period collection headwind versus the prior year. As we think about the rest of the year, we are contemplating that. The comps get harder for volume, but obviously, we have great expectations for the Decipher franchise for the rest of this year and into perpetuity, especially given the nascency of the market at 40% penetrated. We have 65% share. We just grew volume 37% this quarter. We've seen some other numbers out there that are less than 37% for our competitors. I think we're well on our way to continuing to deliver really strong growth from the Decipher franchise, thereby bridging the gap into our other growth drivers that are now very much on the come in the next couple of years or two.

Colleen Babington (Equity Research Associate)

All right. Thank you.

We just have one follow-up on MRD. Can you help us better understand how the data shared from TOMBOLA positions your test as differentiated in bladder relative to currently marketed assays? Also, given higher COGS associated with sequencing the whole genome at every time point, what optionality do you have on sequencing to ensure that your MRD test is not meaningfully margin dilutive at launch? Finally, I believe in the prepared remarks that Marc indicated that you submitted your tech assessment to Moldiex last month or in March, rather. Should we assume that you will have reimbursement at the time of launch?

Marc Stapley (CEO)

Yeah. Let's cover each of those. Rebecca and John, feel free to jump in here. TOMBOLA differentiated the test relative to ddPCR and compared the performance of the whole genome approach.

If you actually look at that publication or that presentation, you can kind of see how the investigators tackled that. If you think about relative to other tests on the market and how to penetrate the MRD market, we have consistently maintained that the most important measure is how much sooner than imaging, which is the standard of care, you are detecting recurrence. In this particular case, TOMBOLA, it reinforced data that we had already presented and published in MRD, which is, in this case, it was 93 days, which is a great lead time. That, and then, of course, the whole genome approach is what we really believe every step of the way is differentiating. It goes to our underlying philosophy. I will come to the kind of last further part of your question and let Rebecca come back to the COGS impact of that.

If you think about Decipher and how we've approached that, I said before, we could have run a 22-gene assay for every single test, and we would not have close to 100 publications supporting the use of Decipher if we had done that. It is the ability to have all that rich data. As long as we can make sure, to your point, we can manage the COGS of that and the margin of that, it is a very worthwhile investment in creating the richness of that data for every single sample and the ability to use that in the future to advance our test into other indications and into human naive and what else. I mean, there are things we could do with it that we can't even contemplate today.

It's hard to imagine a world where 5-10 years from now, everybody's not talking about the richness of whole genome data in this space. Do you want to talk?

Rebecca Chambers (CFO)

Yeah, of course. On the COGS side of the equation, in muscle-invasive bladder cancer, we absolutely are excited about that indication because approximately 85% of the population is Medicare. Therefore, from an ASP perspective, it should be a relatively nice ASP out of the gate. We have multiple projects ongoing on the COGS reduction front for MRD, just similar to those that we talked about today with regard to Afirma.

Over a multi-year period, we have a lot of confidence in our ability to drive down sequencing costs, excuse me, as well as obviously, there are many different sequencing platforms that are currently at play that may or may not be influencing our cost-down roadmap. We are excited about the potential for having a very data-rich MRD platform with cost that is more expensive, admittedly, but similar to the reasons that Marc cited from the Decipher standpoint, we think that is a worthwhile trade. We are really focused on making sure that on an adjusted EBITDA basis, this is a product and a project and a platform. I could not get the right keyword out. Sorry. A platform that is able to be accretive to our adjusted EBITDA over a multi-year period.

I think that's kind of the way we're thinking about it, more so than on a gross margin basis. The last point that I'll add in there is similar to Decipher, we have higher COGS, but we have lower R&D spend in terms of the clinical utility. All in all, we're very comfortable with the path forward, excited about it. Yes, we would be launching with reimbursement.

Marc Stapley (CEO)

Yep.

Colleen Babington (Equity Research Associate)

All right. Thank you so much.

Operator (participant)

Thank you. Our next question comes from the line of Tejas Sawant of Morgan Stanley. Your line is now open.

Tejas Sawant (Associate)

Hey, guys. Good evening and thanks for the time here. Just one quick cleanup for you, Rebecca, on the guide. I think you called out sort of mitigating tariffs as one of the rationales for your v2 transcriptome switch for Afirma.

Is that a meaningful dynamic for you, or is this just really you guys expecting your vendors, including your super thick vendor, to likely add tariffs or charges here shortly?

Rebecca Chambers (CFO)

Yeah, I'm going to actually hand that one over to Marc.

Marc Stapley (CEO)

Yeah, actually, Tejas, we were working on this as part of our lab optimization process, as you would expect us to, for a long time. The point around tariffs was the fact that we're doing this helps us mitigate or should help us mitigate the impact of the tariffs to some extent. There is a lot of uncertainty around that. None of us knows how impactful this is all going to be. As we've always done, we're very focused on COGS to mitigate whatever the supply chain risks are, whether it be tariffs or just price increases.

At the same time, as Rebecca mentioned earlier, we expect price decreases on certain agents as well. As we've always said, we don't really see first or second order. We don't really see first-order effects for us, but we do get second and third-order effects. Our supply chain is impacted by tariffs. In fact, we've already had one vendor talk about raising surcharges on us as well in the future. That's something that we've contemplated in the guide that we've given here. We're managing to that. There's some uncertainty around that, and we'll continue to track it. We'll respond accordingly, as we always do. We've got a lot of irons in the fire to make sure we're able to continue to drive positive gross margin and EBITDA in the future.

Tejas Sawant (Associate)

Got it.

And then a couple of quick follow-ups on the MRD side, Marc, if I may. First of all, I mean, on the TOMBOLA results that you guys have shown at ACR and even earlier this year, I guess my question is the investigator found that ddPCR was more sensitive, but your assay was more specific. So are you guys exploring any opportunities to further boost sensitivity, or you do not think you really need that? And then second, what sort of data should we expect to see at ASCO shortly here?

Marc Stapley (CEO)

Yeah. I mean, I just go back to my previous comment on MRD. If you look at any single measure, whether it be sensitivity, specificity, limit of detection, you are missing the broader picture, right? The broader picture is how much sooner can you pick up the detection and standard of care.

You could tune any one of those other metrics at the detriment of another metric. If it does not help the lead time to detection, then you are going in the wrong direction. We look at it as a collection of these factors and studies that show that the test is effective in picking up detection early. That is one of the metrics that came out of the study that we really like. What should we see in terms of ASCO? Anything, John, you want to refer to on that? No, nothing. Nothing that we are expecting at this point. I do not think we are expecting anything on MRD in particular from us.

Tejas Sawant (Associate)

Got it.

Marc Stapley (CEO)

We will keep you posted, and we will give you our perspectives on things that do come out.

Tejas Sawant (Associate)

Got it. One last one here for me on the Decipher side of things, Marc.

You flagged your digital pathology efforts. Could you just share some color on this view that there is a decent amount of physicians out there who value the complementary data provided by a combo approach? I am hearing some of that from one of your competitors recently, and they are planning to launch their version of the combo test in, I guess, by year-end this year. Curious as to how you are thinking about the timelines to market here and how big the opportunity might be for a value proposition like that.

Marc Stapley (CEO)

Yeah. I think if you ask physicians, and of course, you can imagine that we have, and I am sure others have too, if you ask physicians, then of course, the more data, the better. They do not tend to take one data set and take it at the substitution of another data set. More data is better.

Of course, if they could have complementary data that enhance the information they have, then they would say, "Yes, we'd love to have that." The question that we're still trying to answer is, is the data set complementary? We think it can be complementary, but it can also be contradictory, and that can cause confusion in the space. Now, if you need to add a digital pathology approach in order to bolster an existing molecular diagnostic test to make it perform better, that's one way to do it. As we've always said, Decipher has so much evidence behind it, performs really well across the entire spectrum, that we don't see that that necessarily is needed to enhance Decipher.

If there's a market opportunity for that, then given that we've scanned 70,000 images across 40,000 patients with outcomes, plus we have whole transcriptome for every single one of those, you can imagine that we could make that information available. We have made it available for collaborators today. The research, this is interesting from a research perspective. We don't see the commercial opportunity yet, but we're continuing to drive the research. If there is a commercial opportunity, you can imagine we would jump on that.

Tejas Sawant (Associate)

Got it. Fair enough. Appreciate the color. Thanks, guys.

Operator (participant)

Thank you. Our next question comes from the line of Thomas DeBourcy of Nepheron Research. Your line is now open.

Thomas DeBourcy (Analyst for Healthcare Equity Research, Strategy, and Investment Management)

Hey, guys. A question at Decipher related to, I guess, your ability to expand coverage now with, I guess, level one, I guess, being NCCN guidelines relative to other tests.

Have you seen, I guess, an expansion of coverage over kind of the last several quarters? Have payers maybe changed also their position on some of the other tests as well that maybe also help share gain?

Marc Stapley (CEO)

Yeah. John will answer that.

John Leite (CCO)

Thanks for the question, Thomas. Yes. This is obviously an ongoing set of activities here being managed by my team. We are constantly engaging with payers, whether they be government, private, or otherwise. We do see traction in our discussions and very active engagement with payers, with the coverage setters, with the lab benefit managers. We are in an active exchange of the latest evidence as well as the latest guidelines. As you can imagine, these are generally long-term conversations that coincide with an annual review of the evidence.

When we believe we are closer to gaining traction or when we believe that a release on coverage policies is looking to expand, we will be sure to note those.

Marc Stapley (CEO)

Tom, one thing I would add, obviously, having a conversation with payers and showing the level one guideline, the NCCN guidelines with the level one evidence that we have really helps bolster that conversation. It does not get you over the line in every case. It is really hard sometimes, but it certainly helps.

Thomas DeBourcy (Analyst for Healthcare Equity Research, Strategy, and Investment Management)

Thanks. Maybe just a follow-up question on the slide talking about 2026 to 2028 targets and profitability targets still about 25% of adjusted EBITDA. In the context of new product launches, would you also be considering your spending relative to targeting that 25% adjusted EBITDA goal?

Rebecca Chambers (CFO)

Yes.

The goal absolutely takes into account what we believe will need to be spent over the next period of time to launch all of those products. We have shown an ability to do things much more efficiently than others in the space and a revenue per headcount basis if using that as one metric. I do not expect our new product launches to be any different. We will be building a [MedOnc] channel for Prosigna. It will take multiple quarters and years to really get to the point where it is at scale. Similarly to how we are investing in Decipher and Afirma, we put a handful of heads in that in any given period. We will be able to meter that in in a way that is tied to revenue growth.

We're super excited about our ability to continue to drive a differentiated profitability profile and do all of these things at the same time.

Thomas DeBourcy (Analyst for Healthcare Equity Research, Strategy, and Investment Management)

Great. Thank you.

Rebecca Chambers (CFO)

Thank you, Tom.

Operator (participant)

All right.

Thank you. Our next question comes from the line of Sung Ji Nam of Scotiabank. Your line is now open.

Sung Ji Nam (Senior Healthcare Equity Research Analyst)

Hi. Thanks for taking the questions. Maybe on the UMBRELLA study with the 700 patients, is that enough for at least some of the indications that you mentioned for you to submit to Medicare for reimbursement, or should we anticipate a few more studies of the size might be needed for you to do that?

John Leite (CCO)

First, let me answer by saying that you're probably always going to see more studies coming from us, given our track record.

The second is, yes, we do believe that the study is being appropriately designed in its prospective manner, and it will be sufficiently powered per indication to yield a positive coverage from Medicare.

Sung Ji Nam (Senior Healthcare Equity Research Analyst)

Got it. Rebecca, you mentioned your guidance raised for adjusted EBITDA margins for 2025. You attributed it to laboratory efficiency projects and timing of project spend. Kind of could you elaborate a bit on the project spend, what that entailed?

Rebecca Chambers (CFO)

Yeah. Actually, one is a good guy, one's a bad guy, right? Q1, we outperformed by, call it, around 150 basis points. We raised the guide by around 100 basis points. The delta between those two, plus a little bit of the goodness from the gross margin projects, is what we're relating to in project spend.

Think of that, Sung Ji, as really R&D that we thought was going to be spent in Q1 getting pushed throughout the rest of the year. Just timing.

Sung Ji Nam (Senior Healthcare Equity Research Analyst)

Gotcha. Thank you so much.

Rebecca Chambers (CFO)

Thank you.

Operator (participant)

Thank you. Our next question comes from the line of Matt Sykes of Goldman Sachs. Your line is now open.

Hey, guys. Thanks for taking our questions. This is Will on for Matt. Can you talk about the initial response to the early launch of Decipher in the metastatic population and remind us of the potential contribution in the back half of the year following the broader launch? Thank you.

Marc Stapley (CEO)

Yeah. The initial launch, as you can imagine, and the reason we did an initial launch is because we had physicians jumping at the bit to start to use this in patients. And I cited an example in the prepared remarks of an existing case.

That particular physician is very excited to be able to have that information. It is early days. We just launched this at the end of April. So far, we are quite excited about the reaction.

John Leite (CCO)

We just came back from the AUA, and already the conversation was very strong around metastatic disease. We expect the trend to continue at ASCO, where we will be in full launch mode. I appreciate the question. Thanks.

The ramp in the second half?

Rebecca Chambers (CFO)

Is implied in the guide, is expected. We are expecting this to be not dissimilar post the biopsy launch when it received Medicare in 2019. Obviously, it will change the trajectory when we have guidelines, but we are not expecting that in the guide this year.

I think it's a contributing factor, but the vast majority of the growth this year will come from penetrating and share gains in the biopsy portion of the macro market.

Understood. That's helpful. Thank you. Switching over to Afirma, how should we think about the components of growth for the rest of the year, I guess, excluding prior period collection impacts, including any potential benefits from the updated GRID offering?

Yeah. Again, I take the updated GRID offering as kind of being table stakes for us at this point in time. It's needed to demonstrate the growth that we've talked about more so than driving a specific component of growth. It's just part of our overall strategy. It's really challenging to parse out things like that. In general, we saw great volume growth in the first quarter. We would expect that pretty strong volume growth.

Prior period collections for Afirma may end up to be a headwind for the rest of the year. We'll have to wait and see. Between those two things, we're expecting high single-digit revenue growth. How one nets out versus the other in any given quarter, I would love to be able to tell you. That's not perfect. My crystal ball is not that clean.

Got it. Thank you.

Operator (participant)

Thank you. Our last question comes from the line of Mason Carrico of Stephens Inc. Your line is now open.

Hi. Good afternoon. This is Ben on for Mason here. Thanks for taking the question. I'll just keep it to one here. Could you talk about the training that you've done with your salesforce for the metastatic indication for Decipher? What are your thoughts on when these reps are going to be fully productive for that indication?

Talking about the synergistic call point here, when you think about MRD coming online next year, how do you see reps prioritizing their time between MRD, Decipher, and localized, and then the Decipher metastatic?

John Leite (CCO)

Yeah. Excellent question, Ben. On part one, we have started the training and those discussions at our national sales meeting in January. We just held an advanced training in the last couple of weeks. That was a full day of both content and tactical training. These are, in general, the call points that they are already calling on. These are, for the most part, our large urology group practices. They routinely handle and manage patients with metastatic disease. This is a natural extension of the discussions that they are having with those physicians in those group practices.

For part two of your question and how we're managing and balancing our time, again, it is an extension of the call points. We pride ourselves in training our sales reps to have meaningful and educational discussions in those practices. This would be a topic that they would rotate in as part of one of their visits into those practices.

Got it. Thank you.

Marc Stapley (CEO)

Thanks, Ben.

Operator (participant)

Thank you. This concludes the question and answer session. We'd like to thank you for your participation in today's conference. This does conclude the program, and you may now disconnect.