Castle Biosciences, Inc. (NASDAQ:CSTL) Q2 2023 Earnings Call Transcript

Derek Maetzold: I think, as we had said in the remarks there, and I think put into the filing, too, the primary item here was that the adoption of the test for patient care outran our forecast on the upside. And so the decision was that we should treat our customers honestly and directly and just say, hey, until we can have these post lab movie efficiencies be implemented and scale up properly, we should just tell you, let’s kind of put it put on pause for a few weeks here, and we’ll come back to you. In terms of the feedback from the field, I’m unaware of a single unhappy customer. In fact, most were. I can’t believe you guys Actually did this upfront. We’ve never seen companies in the GI space that actually treat us honestly, so I don’t think that’ll be any kind of an issue for us to sort of say, hey, we’re ready to go ahead and begin accepting orders, and we’re at a turnaround time that we think maximizes patient care.

What can we do? How do you want us to help you get restarted again? That I think will be a non issue, Catherine.

Catherine Schulte: Okay, got it. Then maybe just going back to Puneet. Understand that your guidance doesn’t assume SEC reimbursement going forward, but can you just confirm that you’re still getting paid by Novitas as of today? And is it your understanding that you’ll most likely keep getting paid until a potential final LCD becomes effective?

Derek Maetzold: Yeah, we do have reimbursement for the test now, Catherine. And beyond that, we would be guessing if we made any other predictions.

Operator: Thank you. We now have Mark Masro with BTIG. Please go ahead when you’re ready.

Mark Masro: Hey, guys, this is Mark. Thanks for taking the question. So, just circling back to third party guideline inclusion, could you just remind us where you stand in any dialogue you’ve had with the NIH and Memorial Sloan tettering in addition to NCCN, and you’re thinking about likelihood of SEC inclusion and guidelines maybe perhaps ahead of [ph]BDM? Thanks.

Derek Maetzold: You’re asking a question relative to the okay, so the NIH database and the Sloan Kettering database referenced in that proposed LCD only review do individual gene mutations. So individual gene analyses, they’re more like Aggregating or Curating databases. They don’t review RNA based tests, and certainly not multiple gene tests. That’s those two groups would never review any of the sort of Moldyx reviewed kind of tests. Right. And gene expression profile tests on NCCN, I believe they met in late April or early May. We did submit a package, as you would expect us to go ahead and do. That’s a relatively new committee. I mean, it was established maybe in 16-17,17-18, maybe three or four or five years ago. If we go back and track the time between their sort of spring meeting and the time they update guidelines, that varies quite a bit.

Last year when they met in I think it was early May, they posted updates, I think earlier in the first quarter of this year. So that was kind of an eight or nine month cycle time compared to the Melanoma group, which is always about five or six months or so. So I don’t know if we can predict or provide any factual kind of guidance about saying would we expect something in September versus December that would be based on any kind of analysis, to be honest.

Mark Masro: Okay, perfect. Thanks so much for that. And I guess as far as the assumptions based into the raised guidance, you talked about being able to meet the guide in the absence of SEC reimbursement, so I was just curious, as far as your long term guidance, what are the puts and takes there and what’s contemplated for SEC long term? Thanks.