Guardant Health, Inc. (NASDAQ:GH) Q2 2023 Earnings Call Transcript

Patrick Donnelly: Okay. That’s helpful. And then maybe just on the MRD side. Thinking about the spend levels, again, you guys have been pretty clear on the screening piece. But just on MRD, can you just talk about your expectations around the spend there, thoughts on data generation versus kind of driving increased market penetration just how we should think about the level of investment around that segment is a nice growth area for you guys.

Helmy Eltoukhy: I’ll start and I’ll let Mike sort of fill in some of the financial pieces. It’s an area that requires a heavy amount of clinical validation and clinical studies is something that we’ve been building up for the last 4 or 5 years, and we have a very nice pipeline of studies across multiple indications and we’re planning to essentially process and run and have these collaborations going forward and hope we can share some more of that in the months. And that being said, we’re going to be very judicious about how much we invest, how we pace those investments and how much we invest in terms of market share. So we’re continuing to grow really nicely, 100% year-over-year. But we’re engineering the demand, as we said in the beginning of the year.

So the — we’re not letting essentially the burn sort of get ahead of us too much. We really see no competition from a tissue degree in view. We think — this is a product category of its own product category that is going to be the ultimate winner in this MRD market. So we’re in a very good spot right now.

Michael Bell: Yes. I mean maybe just to reiterate that we would be a very sort of judicious on the investments we make. That’s investments as well as the market development and technical development but also on just processing the samples running those samples prior to getting reimbursement. So we’re managing that very, very closely. We’ve got our stated goals on cash burn this year and going forward. and on operating expenses this year. So we’re just — we’re closely managing that investment within those parameters that we have set.

Operator: Our next question comes from Dave Delahunt with Goldman Sachs.

David Delahunt: Any additional color you could give us on MRD trends. I think I heard you say to Pat’s question, you’re seeing market share grow 100% year-over-year. Is there any qualitative color you could give us around what are the main selling points have resonated the most with docs? And what are the main questions they’ve had?

Helmy Eltoukhy: I would say it’s really the fact that it’s simple blood to get the results really quickly, much faster than tissue-informed approaches and really just, I think, customer service that we have, the quality of the team, the strength of our commercial team, I mean there’s really very few apologies if any that haven’t ordered a test from us. And so really sort of being integrated with their offices and having that unified experience, I think, is another big piece. And then obviously, as we sort of continue to evolve the platform towards smart liquid bias really going to just change the game in terms of what MRD even means, what MRD has to provide to position. So we’re very confident in terms of where things are going to market and where we are right now. But yes, we see really no sort of product out there that as the same probe market as we do, especially in the coming quarters as we continue to upgrade the capabilities of the device.

David Delahunt: Great. And on the screening side, you guys have been super successful in the past with leading the field for liquid biopsy. What do you think is a mix of PCPs who understand the value of blood screening versus the share that would still benefit from more physician education?