Natera, Inc. (NASDAQ:NTRA) Q2 2023 Earnings Call Transcript

Solomon Moshkevich: Happy to. Hey, Puneet. So yes, we’ve – obviously, we’ve enjoyed some good success with Medicare thus far. And we have multiple additional submissions that are planned for this year, one under review right now. I think you can look at the data that we’ve generated and see where the validity is shaping up to support coverage decisions. We’ve discussed before. We think we have strong data in gastro and esophageal cancers in melanoma and looking forward to generating and publishing that data in pancreatic and lung and recently a paper in Merkel cell carcinoma. So I think there’s a very nice pipeline shaping up. Keep in mind that I think that’s – each one of those is going to add a smaller and smaller percentage of the patient population that we test as well.

So the coverages we’ve gotten thus far have been super important, especially with breast cancer coming in uniquely across all subtypes. To your question about pan-cancer coverage, at this point, we are really planning for generating the relevant data indication by indication. And if we see an opportunity to make that inflection we’re definitely going to do that. But we know how the NCCN guidelines committees operate as well. They’re also structured and organized by indication. And so we think the smart thing to do is just continue generating great evidence.

Puneet Souda: Got it. That’s super. And then maybe for Mike, or Steve, as you look at the carrier testing business, obviously, you had one of the competitors that exited and you have benefited from the volume. I just wanted to get a sense of sort of majority of the volume migrated at this point? Or do you expect to continue to see benefit there in the rest half of the year? Thanks.

Steve Chapman: Yes, I think – sorry, Mike, go ahead. Yes, I was just going to tell on the volume standpoint, I think that the volume kind of shifted over in sort of late Q4 and Q1. But go ahead, Mike, if you want to comment further.

Michael Brophy: Yes. No, that’s exactly what I was going to say. I think you had kind of a bolus kind of shift over Q4, Q1. I think you do have some – you got some seasonality here in Q2. And I expect to see some – just continued growth in that business in Q3 and beyond, particularly in Q4 as per our normal pattern.

Puneet Souda: Great. And then do you expect any ASP improvements there too on ECS side?

Steve Chapman: Mike, do you want to take that?

Michael Brophy: Yes, sure. So just on the carrier ASPs, I mean, the guide actually implies kind of a modest erosion and the carrier screening ASP is consistent with what we talked about on the prior people in the Q4 and the Q1 call, and that’s really just out of kind of conservatism from our perspective and just, I think, a prudent way for us to plan the business. I think what we’re looking for there to get sustainably higher ASPs than the care screening business is to get that guideline that Steve was referencing earlier, until then, we’re kind of in a holding matter and hoping to see that improve over the next few quarters.

Puneet Souda: Got it. All right. Thanks guys.

Operator: Next, Matthew Sykes from Goldman Sachs. Please go ahead.

Unidentified Analyst: Hey guys, this is Prashant [ph] on for Matt. Congrats on the quarter and thanks for the question. Given the Dobbs versus Jackson Supreme Court ruling enacted in Mississippi in June of last year, how do you see that impacting your women’s health segment test volumes, if at all?

Steve Chapman: Yes. I mean there’s been various Supreme Court rulings that have come out. And I think we haven’t seen any impacts in the areas where those have come out. I appreciate the question.

Unidentified Analyst: Okay. Got it. Thanks. And then what is the current mix shift of private practices and hospital systems using NIPT versus maternal serum screening? And how do you see this evolving over the next six months to 12 months?