Kamal Adawi: So, we provided the adjusted EBITDA number for 2024. We believe it will be better than negative $20 million. Some of the things to think about is of where we came in at in 2023 with adjusted EBITDA of negative $17.1 million. While we’re continuing to make improvements on ASP, I do want to recall the $5 million in prior period collections that we had in 2023 that were fantastic to the business. And when it’s prior period collections, it 100% flows down to the bottom line. I don’t anticipate to see the same level of prior period collections in 2024.
Dan Brennan: Got it. And is there commentary that you’ve got $75 million in revs and 60% gross margin, which is a target to turn fee cashflow positive. I know you said – I believe you said cash on the balance sheet, the $37.5 million, gets you into 2026, or is the implication – do you think the 37 – or do you think the current cash balance will actually get you to that? Or excuse me, $36.5 million, will that get you to free cashflow positivity?
Kamal Adawi: A good question, Dan. We haven’t connected the two externally in a public forum. What we’ve worked to do is as the business performance has improved and we’ve seen the runway extend, we’ve worked to communicate that consistently. So, previously we had said we had cash well into 2025. Now, we’ve extended that projection into 2026. We haven’t connected the two. We’re highly dependent on improvements in ASP, right? The slope of our progress for ASP gains will really govern our pace at which we achieve cash flow positivity. So, that’s the connection there. Likely need to get to an ASP around the mid to high 400s in order for that to materialize. We’re making meaningful progress. You saw that over this year. We’ve pointed to a trailing 12-month number, but the quarterly progress is very positive as well. So, that’s how we look at it.
Dan Brennan: Got it. And then a final one just on sales headcount, can you just remind us kind of where are we today? Is that number stable? And just give us a sense of where you are with like calling accounts to focus on profitable accounts versus beginning to be at the point where, I know you talked about like most of the year, this year is still ASP accretion for the guide, but just where are you like in the field towards seeing maybe that restrictive nature focusing on profitable accounts flip towards being able to grow volumes again?
John Aballi: So, when it – if you take a look at it, when it really comes down to it – over 2023, we really changed our business. And I think at the core of it, the way we think about it is the insurer is a customer of ours, and there are some things that they require which can be burdensome for the ordering physician and therefore impact their desire to partner with us in patient care. So, the superior performance of AVISE CTD test is still seen by around 2,400 clinicians. That’s our year-end ordering physician count. We just need to work with them to satisfy the insurer needs and in a way which doesn’t overly complicate or burden their clinical practice. That’s our goal. That’s what our field-based team is working on. We’re no different, as healthcare costs are increasing, those of us with fixed pricing are getting squeezed, and the practicing clinician is seeing the exact same scenario.
What we’re asking of them, additional medical records, more information on the requisition, better documentation of the clinical utility of the test and how it’s being used in patient care, they don’t get reimbursed for any of that. And so, it’s increasing their operating costs. And with rising wages, this is not an insignificant ask, but the way we see it, it’s a requirement of doing business in this space. It’s a requirement of offering proprietary testing. We just need to get good at it as a business and in developing processes with each of our customers to satisfy insurer requests. That’s what we mean by building back over time. We saw ordering trends stabilize in Q4 within our physician base. We’ve seen it building back here in Q1. And so, from our standpoint, we still have 40 territories spread throughout the continental US, and that’s likely to not change here in the near-term.
We continue to monitor on a per territory basis which territories are at least covering the cost of the sales rep breaking even, and those which are materially higher that we should split. We’ve done at least one analysis this past year. We look at it as kind of a biannual thing where we review each of our territories from a profitability standpoint, take a look at six-month trends, and then we’ll adjust. But for now, 40 territories is the right footprint for us and will be likely for a portion of this year.
Dan Brennan: Great. Thank you, John.
Operator: Our next question is from the line of Ross Osborn with Cantor Fitzgerald. Please proceed with your questions.
Ross Osborn: Hey guys, congrats on progress. So, maybe just one for me at this point. It sounds like ASP is going to be the biggest driver to achieving EBITDA breakeven, but would be curious to hear your thoughts about OpeX cadence for this year. Is there any chance we should expect leverage on the SG&A line?
Kamal Adawi: So, Ross, the way that I’m looking at OpeX is there’s no major commercial expansion. Similar to the increases we’ve had in the past, I wouldn’t anticipate anything like that. Right now, it’s just us managing against inflationary increases on the SG&A lines.
Ross Osborn: Okay, great. Thank you.
Operator: The next question is from the line of Andrew Brackmann with William Blair. Please proceed with your questions.
