James McCullough: Yes. We want to be careful about commenting on the guidelines. I think it’s important to recognize that KidneyIntelX.dkd is an in vitro diagnostic. That’s very important. It’s not an algorithm. It has an algorithm. It happens to have a nonlinear algorithm. We use Random forest, which is a form – which is a machine learning-enabled algorithm. So it is unique. And it took us a long time to figure out how to navigate the regulatory framework with FDA around this nonlinear algorithm. That was quite an achievement. And we knew we needed to use that to generate the performance or the perspective if we were going to start at the beginning of a chronic disease. So these are substantial innovations, and they required an enormous investment of time, data generation and money and expertise.
All of which mean that KidneyIntelX is quite unique especially in terms of positioning to your question, in the clinical space. So there are a number of innovations which go into an in vitro – artificial intelligence-enabled in vitro diagnostic with an FDA regulatory authorization. And then, of course, we get into the whole issue of bringing in electronic medical record features, which many people are doing in algorithms. And it’s interesting but try running it through FDA. And that’s a totally different validating process and the level of validation required to get through a regulatory process when you’re including electronic health record features with all the variables associated with that, which I can’t go into the call, but understanding how those variables impact the nonlinear algorithm output, understanding this entire equation is very complicated.
And obviously, if you can do it, it has significant advantages in terms of prediction and prediction from a very early stage of disease. So there are a number of innovations that went into KidneyIntelX as a product service. We think that those will be pointed out or at least put us in a very distinct category in the guidelines. And I’m not just speaking about KDIGO, I think there will be future guidelines available to us in different disease categories, in different clinical categories because KidneyIntelX is so unique. And it goes right to the heart of the matter, which is how do you predict risk early on in a chronic disease. A lot of us really hasn’t been done before. Certainly not in a regulated format, that’s capable of being paid for broadly by insurance.
And the level of validation required is enormous. And for us, the intrinsic value and having achieved this over a four-year period with FDA, again, puts us in a unique position. And I think that’s going to pay dividends. In fact, we know it’s going to pay dividends going forward because there’s really no other way for the ability to do safe, reliable and effective risk prognosis early on in a disease state in a regulated reimbursed format. It’s KidneyIntelX. And that requires years of investment and a lot of money, which we’ve been fortunate enough to be in a position to have so that we could invest in the real-world evidence, the outcomes data, the validation required to do this. So the franchise value here, we view is quite significant. I’ll stop there.
But OJ, do you want to take on the out of the possible on the cost side?
James Sterling: Sure. And to start with the payables question, that’s primarily a timing factor. There’s an element of – a good bit of that is clinical trial-related payables. Those get invoiced in sizable chunks regularly over the course of the year. So that comprises a bit of the payable growth there. As far as the further cuts, so we eliminated $11 million over that in the past year relative to the year prior. And further cuts available is likely – we’re likely looking at single-digit millions. I don’t want to get in too much specifics, we’re still going through the detailed exercise of identifying where the cuts are and then presenting that to the Board for approval and so forth. So subject to that approval, I do want to get into much more detail, but that’s probably the general quantum there.
Jens Lindqvist: Okay. Thanks, guys. Very helpful. Thank you.
Operator: [Operator Instructions] The next question comes from Yi Chen with H.C. Wainwright. Your line is open.
Yi Chen: Thank you for taking my questions. My first question is, could you comment on the test volume in the health system versus Mount Sinai?
James Sterling: So Sinai still represents the majority of our overall volume, but it’s getting closer to half, whereas previously it was a higher percentage. Obviously, when we started, it was almost entirely – it was entirely Mount Sinai for a while. So seeing increases in independent primary care as well as the Wake Forest and Atrium testing continues to increase. None of that Atrium Wake Force testing is available yet, and it’s all study tests. We do – as we talked about, we do expect that to transition to commercial testing over the course of this fiscal year. But Sinai just over – a bit over half now of the total volume.
Yi Chen: I mean is there a specific reason the VA health system is not generating high test volume?
James Sterling: And I’ll let Tom jump in as well, but go ahead.
