Exact Sciences Corporation (NASDAQ:EXAS) Q2 2023 Earnings Call Transcript

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The total number of patients eligible for rescreen this year, that three-year repeat is 1.2 million, that’s the same as last year. The good news is when you look ahead to next year, it jumps to 1.6 million. So this is a temporary slowdown in that rescreen growth. And the team is doing a good job managing through it. So we are driving growth here. Just to think about the size of the headwinds, over the year, it’s over $50 million of revenue. Again, the headwind, it is temporary. A big part of that is in Q3. So again, team driving through that. Other drivers, things like Cologuard 45, this new age group, that is now part of the guidelines. A couple of years ago, the guidelines lowered from 50, down to age 45, adding 20 million more people. That age group is approaching 20% of all Cologuard revenue.

So a huge driver there. Everett can talk more about health systems. But the good news here is there’s a broad set of drivers here that we expect to continue for many years to come.

Everett Cunningham: Yeah. Thanks, Jeff. I will touch on rescreen in 45 to 49 and health systems. This is just a great example of the way our commercial team is working together and they treat it as a team sport, from our marketing messages specific to 45 to 49 and rescreen, our customer experience around those growth drivers of rescreen in 45 to 49 and our training. We continue to hone our message around this. The data and analytics that we’re using at the territory level in terms of the targets to go to, to grow these two type of growth levers has been tremendous and I’ve been out in the field and it just gets better every quarter. As far as health systems, we’re seeing a trend of health systems coming to us, to help them with getting people screened for colorectal cancer screening.

They’re getting measured by it and they know that they can’t do it alone with colonoscopy only. And we’re developing broader partnerships around those people of average risk that need to get screening and then have a colonoscopy backlog, they’re coming to us for help around getting those patient screen. And then lastly, I’ll just say, our brand, not just around Cologuard but around Oncotype DX, around our rare diseases and prevention genetics, our brand is solid. And they know that they can come to us for help.

Operator: We’ll take our next question from Brandon Couillard with Jefferies.

Brandon Couillard: Thanks. Jeff, two for you. The Oncotype approval in Japan. Will that be material incremental revenue contributor in the back half or is that more a ’24 dynamic? And then the improved cash collections, is that a material benefit to screening revenue growth of 31% in the quarter? And if so, can you call that out.

Jeff Elliott: Sure, Brandon. This is Jeff. On the first one on Oncotype, really proud of what the team did to make sure we got reimbursement and an access to this test to help out, as Kevin talked about, a significant number of women in Japan, which really — when you look at the size of this market, it could be our largest market outside the US. In the first full year, the revenue run rate could be in the $25 million to $30 million range. Obviously, with the time this is coming on this year, we’d expect maybe 25% of that given when this is going to launch. So small contributor this year but a very nice contributor over time. And importantly, a big win for patients. Second one on the ASP revenue per test. As you know, Brandon, there’s a lot of moving pieces when it comes to calculate an ASP, there is the true run rate that you accrue for on a quarter.

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