Myriad Genetics, Inc. (NASDAQ:MYGN) Q2 2023 Earnings Call Transcript

So all of that is to say, Nicole and team did a great job lowering COGS in the quarter. We expected to do that a little bit because of seasonality. But given the lab moves, the moves to NGS sequencing, CLIA surveys, FDA surveys and a 17% growth in volume, I’m not sure if I could expect much more of a lot that we got this quarter.

Operator: And your next question comes from the line of Andrew Cooper with Raymond James.

Andrew Cooper: Maybe first, going to stick with one on gross margins here. If we do the math on that $4 million, assuming you did run all those volumes and just not get paid kind of put your gross margin north of 71% for the quarter. I guess just help me think about, is that the right way to think about things? When we think about the guide, it seems like that maybe implies a little bit of a step back from that sort of adjusted adjusted number. But just help me think about kind of what the moving parts are through the back half of the year on the gross margin side?

Bryan Riggsbee: I mean I think that we certainly ran the test and that would have been a helper, but there are always a number of puts and takes any time you look at the numbers. And we say in the — when we talk about the $68 million to $70 that it will fluctuate throughout the year. So I guess I just — we still feel comfortable in that range around 70% gross margin. I don’t know that I would put a finer point on it relative to that.

Paul Diaz: Andrew, look, I think the thing that we’re most encouraged about going into the third quarter and more importantly, the momentum that causes going into the fourth quarter, which is our strongest quarter is that volumes are — we’re not seeing the seasonal dip that we typically see. We’re growing through that right now, that’s the bigger pressure — that’s a bigger leverage in terms of gross margin. The payer stuff is just frustrating and we’re pretty good at that. And we certainly see some upside in the back half of the year. As Bryan said, trying to work through that. But let’s be clear, the payers are — have raised the level of difficulty on prior ops and just the administrative part of doing business here. And we’re doing a lot of sole searching to think about how we can continue to up our game, leveraging AI and other things.

But as Bryan said, I would resist the urge to focus too much on any one lever. But the bigger lever is growing volumes and then continuing to manage cost and again, the drop in OpEx cost quarter-over-quarter, which is what we committed to, I’d point your attention back to. And again, we’re just we’re working hard to make sure that we deliver on our commitments and I think we’re really positioned to do that in the back half of the year.

Andrew Cooper: And maybe just one more from me. I don’t think you went into too much detail on kind of anything on new products still to come. So maybe just can you confirm timelines or if there’s any updates to FirstGene MRD RUO launch and others in the Precise portfolio, if those are on track or anything else we should be contemplating in terms of timing?

Paul Diaz: So happy to talk about it a little bit. We’re going to really spend some time at our Investor Day talking about that and hopefully, you and others can attend and get from Dale and the rest teams morning sites. And you’re going to hear from our product management team that is fully integrated now more. What I would say is we continue to listen to our customers, do pilots, listen to what people are expecting pre-launch here. And so we’re much more focused on launching with a go to market strategy that we think will win and be differentiated. Generally, everything is on track. We are working on carrier screening panel expansion in front of guidelines, which to me is a precedent before the first three months, we’ve got to kind of get that done, more flexibility around our myRisk panel.