Myriad Genetics, Inc. Aktie

Good day and thank you for standing by. Welcome to the Myriad Genetics First Quarter 2026 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded.

Now it's my pleasure to hand the conference over to the Senior Vice President of Investor Relations, Matt Scalo. Please proceed.

Good afternoon, and welcome to the Myriad Genetics First Quarter 2026 Earnings Call. During the call, we will review the financial results we released today. And afterwards, we will host a Q&A session. Our earnings release was issued this afternoon on Form 8-K and can be found on our website at investor.myriad.com.

I'm Matt Scalo, Senior Vice President of Investor Relations. On the call with me today are Sam Raha, our President and Chief Executive Officer; Ben Wheeler, our Chief Financial Officer; and Brian Donnelly, our Chief Commercial Officer. Joining for Q&A will be Mark Verratti, our Chief Operating Officer.

This call can be heard live via webcast at investor.myriad.com, and a recording will be archived in the Investors section of our website, along with this slide presentation.

Please note that some of the information presented today contains projections or other forward-looking statements regarding future events or the future financial performance of the company. These statements are based on management's current expectations, and the actual events or results may differ materially and adversely from these expectations for a variety of reasons. We refer you to the documents the company files from time to time with the SEC, specifically the company's annual report on Form 10-K, its quarterly reports on Form 10-Q and its current reports on Form 8-K. These documents identify important risk factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements.

I'll now turn the call over to Sam.

Thanks, Matt. Good afternoon, everyone, and thank you for joining us. I want to welcome our Chief Commercial Officer, Brian Donnelly, to the call as he will provide quarterly commercial business updates going forward, and our Chief Operating Officer, Mark Verratti, will join us for the Q&A portion of the call.

Now considering it's been a year that I've been CEO, I thought we'd begin the call by reviewing a number of our key advancements over this time. These include, first, the prioritization of the Cancer Care Continuum. Recall last year, we updated our growth strategy and declared cancer screening and diagnosis as our business of highest importance. Since then, we prioritized our resources, budget and focus with this clear direction. And this year, we're making significant investments in the Cancer Care Continuum, including an expansion of our commercial capabilities and increased R&D spend on product development and clinical studies.

Second, we have strengthened our organization with leaders that have proven experience and a depth of domain knowledge in oncology, genomics and advanced diagnostics. We've added significant expertise in multiple levels of the organization, including Brian Donnelly as CCO; Vishal Sikri as our SVP of Product; Dr. Hosein Kouros-Mehr as our SVP of Oncology R&D, along with other team members to our operations, tech, sales and marketing teams.

Third, we are continuing to strengthen our execution and improve our agility. We have implemented new processes for decision-making and program oversight and have also simplified the organization structure and removed layers to serve customers better. This required making tough decisions that affected a number of our employees, not something we take lightly, but the early progress that we're seeing validates these actions and better positions Myriad to succeed as we go forward.

There is still significant work ahead, but we have clear line of sight to how we will achieve our goals, including accelerated share gain and sustained profitable growth. And that's why I'm very encouraged about Myriad's current position and direction.

Now let's discuss the first quarter results. We reported revenue in the first quarter of just over $200 million, coming within our Q1 revenue guidance range. In terms of testing volume, we delivered 385,000 test results in the first quarter and continue to drive strong volume growth for hereditary cancer testing in both the affected and unaffected populations, where we grew 10% and 16% over the year ago quarter, respectively. These results reflect our deep relationships across community oncology and other provider networks and ongoing efforts to enhance the testing offerings and overall experience.

Brian will provide additional color in his section, but certainly, we see strong demand for our MyRisk hereditary cancer tests, which will continue to be a cornerstone of our accelerated profitable growth journey going ahead.

I'm pleased with the solid growth of our mental health business. First quarter GeneSight test volume grew 7% year-over-year and is the fourth consecutive quarter of mid to high single-digit test volume growth year-over-year. We believe Q1 performance is above market growth, and this is noteworthy considering GeneSight has the leading market share. And we continue to manage this business in a very disciplined fashion to drive growth and improve profitability with a defined set of resources, budget and focus.

Next, as we foreshadowed in our last earnings call, first quarter prenatal volume declined year-over-year. We continue to focus on reactivating accounts, expanding access and driving new customer wins. We expect these actions, along with the launch of FirstGene, to support a return to positive growth in the second half of 2026.

As for the impact of adverse weather during the first quarter, we experienced days of slowdown in the first couple of months of the quarter, largely in the Northeast and certain Midwest territories. We saw strong March test results, so we believe weather had a marginal impact overall.

Taking weather and first quarter business trends into account, we are reaffirming our 2026 financial guidance. We are expecting sequential revenue growth in the low single digits in the second quarter and accelerating through the remaining quarters as our expanded commercial team begins to positively impact second half.

In addition, we reaffirm our positive adjusted EBITDA target range. While Ben will talk through this in more detail, our confidence is grounded in continued strong hereditary cancer testing growth, solid ongoing demand for our GeneSight mental health test and improved prenatal business as well as early contributions from the expansion of our commercial team.

Beyond Q1 revenue, we reported solid gross margin of 69%, in line with our full year range. It's important to have a strong gross margin profile at a time when Myriad is making significant strategic investments, such as the expansion of our commercial organization ahead of a number of major new product launches in 2026. And you can see these investments beginning to run through the adjusted OpEx line.

Ultimately, we reported an adjusted EBITDA loss of $4.5 million and an adjusted EPS loss of $0.09 in Q1. And as Ben will address in his section, we have a solid balance sheet and liquidity position.

Turning to our Cancer Care Continuum strategy. The big news in Q1 was March launch of Precise MRD for breast cancer patients for a select set of customers. While it's early days, we're certainly very encouraged about this product and the impact it can have for patients and clinicians. I'll provide more commentary on the next slide.

Before I get to that, we recently launched a variety of disease-specific MyRisk hereditary cancer panels on our stated timeline and are on track to launch our AI-enhanced Prolaris prostate cancer test in June. And thanks again to Proteomic for their partnership on this. We look forward to providing an update on these new tests as we move through the year.

Now regarding Precise MRD, let me provide an update on our plans and on early feedback from alpha customers. The conversations with customers have reaffirmed our assessment of the MRD market that while greater than 75% of cancer care in the United States happens in the community, we are still in the formative stage for how clinicians are incorporating MRD testing in community oncology.

That's where Myriad has a strong established presence serving nearly 3,500 oncologists today. And as more clinical publications and presentations demonstrate the significant potential benefits of ultrasensitive MRD testing for breast and other cancers, this addressable market expands, and Myriad is well positioned to serve this growing opportunity. For the alpha stage of the commercialization of Precise MRD for breast cancer, we're closely monitoring test utilization, customer experience and internal operational efficiency.

While it's early in the implementation of our program, let me share some key takeaways from the first 6 weeks of the launch. First, in terms of test utilization, we've onboarded and trained nearly a dozen customer sites and onboarded and started engaging even more clinicians. We're happy with the volume of patient samples received to date and some clinicians have already ordered tests for multiple patients based on being satisfied with the results of the first patients tested with Precise MRD.

Next, in terms of customer experience, clinicians have been satisfied with the quality of our test and the turnaround time for getting results from when they place the order. We have received some input on how to make the ordering easier and also learn from early samples received how we can make instructions for sample shipment clear. This another input is already being used to make changes to improve customer experience in the alpha phase and for future expanded launch phases.

Finally, in terms of operational efficiency, our MRD assay itself has proven to be robust and has performed extremely well. We've been pleased with the yield of our assay and also early numbers for turnaround time for the baseline and monitoring assays, all of which are tracking within our pre-established internal targets, which we believe will allow us to be competitive with other on-market tests.

Now let me update you on the overall plan for Precise MRD. First, we're pleased with the growing body of clinical evidence. This data shows that Precise MRD's high sensitivity and an ability to detect disease down to 1 part per million. We believe our MRD platform can help guide clinical decision-making for patients in their journey of cancer care, and has the ability to detect presence and recurrence meaningfully earlier than the standard of care with imaging and therefore, can have positive impact for patient outcomes.

In addition to the multiple presentations and updates already in 2026, including recently at AACR, we look forward to sharing additional updates on clinical studies along with collaborators at the upcoming ASCO conference at the end of May.

In terms of MolDX submissions, our plan remains to submit progress this Q3 and for colorectal and renal by the end of this year. We still plan to expand commercial testing for breast in Q3 beyond our current select set of community practices. However, based on customer input and interest, we're moving up the launch of Precise MRD for colorectal cancer and renal to a select set of customers into Q3. In summary, we're tracking to the plan for Precise MRD that we laid out in Q1 and are looking forward to serving more clinicians and patients over the course of this year while also managing our financials.

Now let me hand it over to our CCO, Brian Donnelly. Brian?

Thanks, Sam. Good afternoon. Before I get into the quarter, I'll briefly introduce myself. I've spent the past 20 years building and scaling businesses across diagnostics, genomics and consumer health at companies, including Ancestry, Amazon, Illumina and GlaxoSmithKline.

I've known Myriad for years and what drew me here is our category-leading assets, serving markets with meaningful unmet needs and having a clear opportunity to unlock growth through commercial innovation and execution. My focus is on driving durable revenue growth, expanding market share and improving return on our commercial investments.

Turning to the first quarter and our Cancer Care Continuum business. As Sam noted previously, we have simplified how we talk about the business externally, aligning around product categories. In Q1, the Cancer Care Continuum product category, which now incorporates both affected and unaffected hereditary cancer testing as well as other genomic testing, which we previously called tumor profiling, generated revenue of $120.2 million, up 4% year-over-year.

Importantly, hereditary cancer testing volume grew 14%, continuing to gain share. Growth in the unaffected population was stronger than the affected segment, and both segments grew above the market growth rates. We were pleased with the unaffected growth rate and view it as an important leading indicator for future demand.

In prostate cancer, Prolaris delivered mid-single-digit growth in both volume and revenue. As mentioned on previous calls, we are actively investing in the commercial channel and other programs to improve performance and regain market share. We're also preparing to launch our first AI-enabled Prolaris test this quarter, bringing together AI, biomarker, germline and genomic insights in a single offering. This combination is differentiated and it positions us to compete more effectively in prostate cancer patient care.

Turning to Precise MRD. Sam covered this well, so I'll just emphasize 3 points. First, clinical evidence continues to build with multiple study presentations at ASCO GU, ASCO GI and AACR. Additional data at the upcoming ASCO meeting is expected to further strengthen Precise MRD's positioning and support broader adoption. Second, early access sites are engaged in providing actionable feedback. And third, we're using this phase to refine workflow, usability and clinical integration ahead of broader commercialization. The commercial and medical affairs teams are actively ramping, and we remain on track for broader commercialization later this year and our full commercial launch in Q1 of 2027.

Now moving to our prenatal health business. As discussed on our fourth quarter call, the prenatal business faced difficult year-over-year comparisons driven by disruption from a new ordering system and the impact that had on several large accounts. First quarter revenue was $41.9 million, down 15% year-over-year.

That said, we are seeing signs of stabilization, including quarter-over-quarter volume growth in Q1. We remain encouraged that our ongoing engagement will win back share and drive overall growth in 2026. And supporting that outlook is our newly deployed prenatal-focused sales team, ongoing engagements to win back key accounts and improving payer dynamics.

To that last point, in April, CIGNA updated its policy to cover expanded carrier screening panels, including Foresight Universal Plus. This is an important step forward for the category.

Moving to FirstGene. We continue early access clinical testing, and we are seeing strong enrollment momentum in the CONNECTOR study. We are encouraged by our assay performance and early customer feedback, highlighting that our clinical value proposition is meaningfully differentiated. The FirstGene screen offers the first and only simultaneous screen of patient carrier status, fetal single gene, fetal chromosome and fetal RHD status, all delivered collectively in a single integrated report with the test able to be taken at an industry-leading 8-week gestational age and with an industry-leading turnaround time with all results delivered within 14 days.

We remain on track for a full commercial launch in the second half of 2026, and we are investing ahead of that launch with confidence in FirstGene's ability to expand clinical insight and to grow the overall prenatal testing market.

Turning now to mental health. In the first quarter, GeneSight generated $38.3 million in revenue, up 24% year-over-year on 7% volume growth. We continue to expand the ordering provider base, reaching over 39,000 ordering clinicians in the first quarter, which is a record high.

This strong first quarter revenue growth reflects improved reimbursement trends and payer coverage aided by biomarker legislation, continued optimization of revenue cycle workflows and solid underlying demand and sales performance. We remain disciplined on this business with a strong focus on capital efficiency while delivering growth.

I want to close with how we are accelerating growth. We're investing $35 million over the next several years to strengthen our commercial capabilities and support multiple upcoming launches. On the commercial capabilities specifically, there are 3 areas to highlight.

First, we expanded our sales team by over 100 account executives compared to last year, adding meaningful field sales capacity, particularly in oncology, to increase our share of voice ahead of new product introductions. Many of these hires bring strong experience in the advanced diagnostics sector.

At the same time, we're focused on improving sales productivity through better onboarding, targeting and performance management. We expect ramping new territories to take several quarters, but this investment is critical to deliver long-term acceleration and profitable growth and our second half plan.

Second, we're enhancing our demand generation capability, particularly in hereditary cancer. This includes new digital patient engagement, risk assessment tools and channel partnerships designed to activate patient-driven demand in the provider channel.

And third, we're preparing for one of the most important launch cycles in the company's history with critical launches across the portfolio, including FirstGene, Prolaris+AI and Precise MRD. To support this, we're strengthening cross-functional launch execution, medical education and KOL engagement, sales targeting and analytics and tools that simplify ordering and integration into clinical workflows. The objective here is faster awareness, faster adoption and stronger return on investment.

So stepping back, our Cancer Care Continuum portfolio continues to show solid growth and share gains. Our prenatal portfolio is stabilizing with a clear catalyst ahead in FirstGene, and mental health is delivering strong performance with improving profitability.

At the same time, we're building the commercial capabilities needed to support sustained growth and upcoming launches across the portfolio. Overall, we're early in the process, but the direction we are heading is towards improved execution, accelerated growth and positioning Myriad for sustained expansion, giving us confidence in delivering against our full year guide.

With that, I will turn it over to our CFO, Ben Wheeler.

Thanks, Brian, and welcome to the earnings call team. I want to reinforce Brian's comments regarding the simplification of our product category messaging. As we discussed on our fourth quarter call, this change better aligns with Myriad's updated growth strategy and how we manage and communicate the business.

Our Cancer Care Continuum category now includes both effective and unaffected hereditary cancer testing, along with other genomic testing previously referred to as tumor profiling. Prenatal health now reflects Prequel noninvasive prenatal screening, Foresight carrier screening and SneakPeek, our early gender DNA test. FirstGene is also included in this category. Our mental health category remains unchanged.

With that context, let me start by reviewing the key drivers of our first quarter performance. We generated another quarter of strong test volume growth in hereditary cancer testing with 14% year-over-year growth in the first quarter, accelerating from the 11% year-over-year growth we delivered in the fourth quarter. This acceleration was driven by continued strength in our unaffected market where demand and execution remains strong.

GeneSight also started the year with strong momentum, delivering 24% year-over-year revenue growth and 7% test volume growth in the first quarter. This performance reflects improving reimbursement dynamics, including the positive impact of recent biomarker legislation as well as continued progress in our revenue cycle management capabilities and overall commercial discipline.

As a reminder, our engagement with health plans and biomarker loss states has been productive, driving sequential improvements in GeneSight average revenue per test for multiple quarters. While no single plan is material on its own, the aggregation of these coverage wins has become a meaningful tailwind for the business. Looking ahead, we're encouraged by additional GeneSight coverage opportunities in biomarker states and plan to extend this reimbursement playbook and payer relationships to our cancer screening portfolio.

Taken together, the sustained strength in both unaffected hereditary cancer volumes and GeneSight volumes is an important proof point that our commercial performance is strengthening. The actions we've taken to sharpen focus, increase accountability and improve execution are translating into tangible momentum.

Moving to our consolidated financial results. For the first quarter, we reported revenue of $200.4 million, within the revenue range we provided during our Q4 call and representing 2% growth year-over-year. Overall test volumes were consistent with the prior year as continued strength in hereditary cancer testing and mental health was offset by prenatal health. Average revenue per test improved 2% year-over-year, driven by growth in hereditary cancer testing revenue and improved reimbursement trends in mental health during the quarter.

While we're pleased with the net positive year-over-year change in average revenue per test this quarter, we continue to expect modest headwinds to ASPs over the longer term, consistent with our prior commentary. We generated gross margins of 68.7% in the first quarter, in line with our full year gross margin guidance and up approximately 20 basis points year-over-year.

The modest improvement reflects a favorable shift in product mix to more margin-accretive revenue. We remain committed to driving efficiency and scale in our laboratory operations for both our existing portfolio and the new product launches in 2026.

Adjusted operating expenses increased by $8 million year-over-year, reflecting targeted investment in commercial execution and R&D growth initiatives. We remain committed to balancing strategic investment to support long-term growth with continued progress toward improving profitability while ensuring capital is allocated to our highest impact priorities.

Taking all of that into account, we generated an adjusted EPS loss of $0.09, within the guidance range we provided.

Next, I'll speak to Myriad's profitability and liquidity. As we've discussed in the past, the first quarter is typically our heaviest cash burn quarter driven by softer overall revenue and elevated expenses, and this year is no exception. First quarter adjusted EBITDA was a loss of $5 million, coming in below the near breakeven commentary we provided due to an acceleration of commercial growth investments.

We're committed to profitable growth and we'll manage our annual operating expenses to grow at a slower rate than our annual revenue. We continue to maintain a solid balance sheet with access to $199 million in capital, providing us the flexibility to invest in our strategy while maintaining appropriate financial discipline.

Next, I'll address financial guidance. We are reaffirming our full year 2026 financial guidance, including revenue of $860 million to $880 million, adjusted gross margin of 68% to 69% and adjusted EBITDA of $37 million to $49 million. During our fourth quarter call on February 23rd, we shared additional commentary on how we expect the year to unfold, including our view that the second half of 2026 will be stronger than the first half, consistent with recent years.

This outlook is supported by current business trends and anticipated improvement in our prenatal portfolio, early contributions from the expansion of our commercial team and recent revenue cycle initiatives. As a result, we expect quarterly revenue to grow sequentially from first quarter and the low single-digit range during the second quarter and accelerate through the remaining quarters of the year as we realize early contribution from the addition of over 100 account executives. We remain confident in our full year outlook and in the team's ability to execute as we progress through 2026.

Now let me turn the call back to Sam.

Thanks, Ben. Let me conclude our prepared comments by highlighting our robust pipeline of new products and enhancements this year. Many of these tests will strengthen Myriad's position across the cancer care testing continuum and support our long-term growth profile.

We continue to drive double-digit growth in hereditary cancer testing, which is enabled by a combination of our strong market position, commercial execution and ongoing commitment to clinically relevant innovation as reflected in the expanded MyRisk test launched this past Q4 and the recent launch of disease-specific panels.

We're encouraged about the early experience and learnings from the alpha launch of our Precise MRD test for breast cancer, and we'll soon be expanding the number of sites on a path to full commercial launch in 2027. We're investing in the commercial team and its capabilities ahead of the full launch, and we'll continue to update investors on our progress.

We're on track to launch our first AI-enhanced Prolaris prostate cancer test that combines the power of molecular and AI analysis next month. And to round out the pipeline, we recently initiated commercial testing with a select number of customers for our FirstGene test and are on track for full commercial launch in the second half of the year. These new products, combined with our operational strength for sample processing and reporting and expanding commercial capabilities and commercial reach give us confidence in accelerating profitable growth in the quarters ahead.

I'll now pass the call back over to Matt for Q&A. Matt?

Thanks, Sam. And as a reminder, during today's call, we use certain non-GAAP financial measures. A reconciliation of the GAAP to non-GAAP financial results and a reconciliation of GAAP to non-GAAP financial guidance can be found in our earnings release and under the Investor Relations section of our website.

Now we're ready to begin our Q&A session. To ensure broad participation we are asking participants to please ask only one question and one follow up. Operator, we're now ready for the Q&A portion of the call.

[Operator Instructions] It comes from Kyle Boucher with TD Cowen.

I wanted to start on just sort of the revenue ramp through the back half of the year. Is there any bridge you can sort of provide for the second half growth rate? I mean I think your guidance implies first half is sort of low single digits. So it's a pretty big step-up in the back half and you reiterated guidance. I guess how should we think about the different moving pieces?

Kyle, thank you for the question. Let me start, and then I'll hand over to Ben to provide some more color. Again, first stating, we are confident in being able to be within our revenue guidance for the year. The elements of confidence, again, we're very pleased with the growth that we've seen in hereditary cancer, really in the Cancer Care Continuum. We're pleased with the ongoing performance of GeneSight, and we're also counting on improvement in our prenatal business, which has been a little bit slower than expected, but within range.

You put that together with the contributions that we're expecting with the sales teammates that we've hired. You heard Brian talk about 100 folks that we've hired. That's a little -- we accelerated that. We're able to get them in. They're going through the process of being trained and prepared. All of those things are what support our confidence in being able to achieve both second quarter and the quarters ahead.

But Ben, what would you add to that?

Yes. So the only thing that I would add is repeating a comment that Brian shared in his prepared remarks as it relates to focused sales forces. And so as we enter Q2 and then proceed through the rest of the year, we have focused our sales forces to make sure that they are spending time in the unaffected market, specifically selling hereditary cancer in a focused way, also in the prenatal side of the business, having a focused sales force calling on doctors and focusing on the prenatal product. We believe that will drive some pull-through on the volume side.

Got it. And then maybe just one more. I think you mentioned during the prepared remarks that you guys are coming up on one of the biggest launch periods for Myriad. Maybe can you just dig in a little bit more on how do you balance that investment that's needed to address those launches and maintaining your adjusted EBITDA profitability?

Yes. Let me start again, and Ben, if you can add on. It starts, Kyle, with a well-crafted year thinking about the timing of investments. We wanted to make sure we're able, for example, on the commercial side, to add sales team members with the right level of experience, which, by the way, we've been very pleased with the talent that we've been able to hire on, particularly to support MRD, the molecular side of cancer care, if you will, that we're building out. It's the timing of that.

It's also the work that we're doing from a market activation, awareness, demand setting standpoint. And for MRD, in particular, it's the number of clinical studies. And I will tell you that we are being mindful to balance the timing of these things to match to stay within what our guidance has been overall for our profitability.

Ben? Color?

Yes. So Kyle, as you know, about 2/3 of our operating expenses are related to people. And so a lot of what drives the successful launches are people investments. And you saw some of that in our Q1 expenses.

In the prepared remarks, I talked about the acceleration of commercial investment, and that is to help us drive success with these launches and also to be able to drive the additional volume and the opportunity to increase revenue as we progress through the year in order to help us manage the timing. It is something that we're focused on, and we are committed to drive profitable growth. So it is something that takes a lot of our time and attention, and we're focused on delivering on that.

Our next question comes from Tycho Peterson with Jefferies.

I wanted to just touch on the hereditary strength. I know you talked about the unaffected market. I'm wondering if you could just maybe delineate how much came from the dedicated sales force versus the expanded MyRisk panel and any lift from the EMR integration as well?

Yes. Appreciate the question, Tycho. Yes, again, just to restate, we were very pleased with the continued strength actually of hereditary cancer business. I think I provided this detail in my prepared remarks, those that have cancer, so the affected market, 10% volume growth, 16% the unaffected. We think that the MyRisk, the new updated panel with 63 genes, it's been a strong point. We are the most relevant current, if you will, panel for hereditary cancer testing. It's definitely helping.

As it relates to dedicated sales force, you know what, here's the good news. That is only going into effect as of April 1st. So I can tell you that really, that that was not within the Q1 numbers, didn't impact it. Now that being said, Tycho, you might have also heard that we just recently launched the various disease-specific panels for breast, prostate, ovarian, colorectal cancer. So we think that will be another good guide for us that will support part of our ongoing growth along with now the dedicated unaffected hereditary cancer sales team that we have in place.

Okay. That's helpful. And then maybe just a follow-up on Precise MRD. You mentioned pulling forward CRC and renal into 3Q. I guess just talk about the thought process there. You obviously have breast as well. So what was the rationale for pulling that forward? And how do we think about, I guess, any sort of additional resourcing?

Yes. I mean the real motivation of this, as you'll recall, again, our original plan that we stated in the last quarter was to launch in the -- around the Q4 timeline for colorectal cancer in renal. And that was to originally be timed ideally with when we submit for MolDX for both of those indications.

Really, what drove our move up of that date is the interest from the community oncologists that we started to work with. And often the case is if you started to serve with breast as we have, they're also interested in other cancer indications where they're seeing those patients come in.

And so we realize that we're -- we think we can still manage it within the controlled way that we're rolling out our commercialization while managing our profitability, but we think that we can actually benefit from understanding how we can serve across multiple indications in the same oncology practices.

Yes, Tycho, the only thing that I would add is we had contemplated the costs around dedicated sales folks as it relates to MRD launches. And so really accelerating CRC and renal is not an acceleration of expense per se as it relates to personnel.

The last thing that I'll mention is, and you know this, hereditary cancer is the profit engine of the organization. And as we drive growth through those channels, it enables us to invest and manage expenses in that way so that we can deliver on profitable growth.

Our next question comes from Puneet Souda with Leerink Partners.

Just wanted to follow up on the commercial side. Could you update us -- you talked about a number of accounts sort of 100 account reps versus last year. Just maybe just give us more updates on do you expect further investments into commercial? How should we think about the overall productivity? To what extent they're carrying different products in the bag? Maybe just walk us through that on the commercial side.

Yes, Puneet, I appreciate the questions. Let me start and Brian, then if you can please add in. First of all, the lens through which we're really running the whole company again is by prioritizing the Cancer Care Continuum. So the vast majority of our investment, be it in these -- the addition of commercial resources or marketing campaigns, market activation, demand generation, other things are -- that's our primary focus. And then also keep in mind, this is through the construct that we're going into place this year, which we've talked about with more dedicated sales teams, particularly for prenatal as well as unaffected. Now there's a lot more to that. So Brian, why don't you take it from there?

Yes, absolutely. Thanks for the question. So I'll just -- I'll hit on the 3 pieces. The first was around the expansion of the sales team and how you think about that in terms of the future, will that continue? What I'd say is we're being really targeted as it relates to who our target providers are and what we think the right level of reach and frequency is to be able to achieve our full year guidance. So as we are looking at the expansion, we're putting it in -- we're basing it on who those providers are who we're going after. So we feel really good about the hiring we've done. We've been able to accelerate some of that hiring in the first quarter, giving us more confidence in the back half of the year.

On the product front and on what the teams are focused on, the big shift that we've made with our sales organization is being very focused on the unique portfolios. As an example, in the past, we've had a Women's Health team that was covering both hereditary cancer screening and prenatal testing. Going forward, the way we've structured our sales teams are they're very focused on the portfolio.

So we have a prenatal team. That team is exclusively selling our prenatal products: Foresight, Prequel and soon to be FirstGene. We have a hereditary cancer screening sales team. They are selling MyRisk exclusively. And so having that focus is not only allowing us to see more customers, but it's allowing us to have more meaningful conversations and support customer adoption of the portfolio.

And then on the productivity front, the third part of the question, what you should expect and what we're expecting is it's going to -- as with any of our -- anyone in our position, as we onboard these sales reps, they're going through training. They're getting introduced to their accounts. And so you should expect it to take several quarters for them to be able to reach peak productivity. But we have a really good eye on our data, and we know what we're going after here. So we'll be making sure to continue to optimize.

And Brian, maybe I'll just add to that. Based on the time when we've been able to get them aboard and the very number of quarters you talked about, this is why we believe we're going to start seeing some productivity in the back end of the year.

Got it. That's helpful. And then, Sam, just wanted to get a high-level view from you in terms of the overall portfolio today, either in terms of additions or potential trimming that puts you both in terms of higher growth and potentially higher profitability. Thoughts there?

Yes. Thank you, Puneet. Listen, again, I'll start by saying the part of the business that is at the core, the part of the business that we are most focused on is the Cancer Care Continuum. We believe that based on the reputation we have in the market, the reach that we have, the quality of our testing and the portfolio that we have that we have a real opportunity to expand and be more than the hereditary cancer testing company. And I think we're well on our way with that. Clearly, the alpha launch of MRD is an important milestone to that. The AI-enabled Prolaris for prostate cancer is going to be another important milestone coming up next month. It won't be -- it will be the first of multiple AI-enabled products we'll bring to market over the coming years.

Again, we are managing with an extreme level of discipline in focusing first and foremost on the Cancer Care Continuum. And over time, we are interested in adding other parts to the Cancer Care Continuum where we aren't as strong through partnerships and at the right time for the right set of circumstances in a more direct way into Myriad. And we'll continue to use extreme business rigor on a regular basis as we are looking at every part of the company to say, hey, does this part provide us the expected financial return, the ability to win in the market? Is this best fit for us at Myriad? But our focus again is the Cancer Care Continuum.

Our next question comes from David Westenberg with Piper Sandler.

This is [ Skya ] on for Dave. Maybe just to touch on what you were just speaking about there. On the upcoming launch of the AI-enabled prostate cancer test, how are you positioning this commercially alongside Prolaris? Is there anything we should be looking at specifically with this launch?

Maybe just to start, Brian, I'll hand it over to you. We are very excited about the AI-enabled Prolaris prostate cancer launch. As a -- I think we've mentioned this before, but once we launch this test, this will become our Prolaris test. We believe it's going to provide a step-up in value to our current Prolaris test. And also, just as a reminder, we -- in terms of reimbursement, we're not in our guidance. There is no incremental reimbursement that we're expecting at this phase.

Brian, maybe you can talk a little bit about the teams and how they're getting ready.

Yes, absolutely. Yes. Our teams are actually together this week going through sales training and working through all the positioning and how we're preparing for the market launch. I would say the thing that we are excited about with regard to Prolaris+AI is really the value proposition it has in that active surveillance setting. It's a really important aspect of Prolaris by itself and the AI enhancements certainly augment the clinical value proposition there. So that's a component of how we're thinking about the product offering. And we're, as we've mentioned earlier in the prepared remarks, excited to get this offering out. We've got really positive feedback from clinicians who have seen the product offering, and we're looking forward to get it in the hands of many.

Maybe, Brian, just to add to what you said, and I know this wasn't exactly the question, but I think it is an important part of our overall commitment to prostate cancer testing. Again, we are pleased with the number of collaborators who are now working with us to give us the access to the samples that we've needed to do the clinical studies, which we believe when we're able to publish those will improve our position as it relates to the standings. So we are -- so we're excited about that as well.

Okay. Great. And maybe just secondly, on the GeneSight revenue. Is there anything to call out there on payer dynamics? And are they sustainable for you for the remainder of the year?

Ben, do you want to take this one?

Yes, happy to. So we were really pleased with the performance of GeneSight in Q1. As a reminder, we've seen improvement in GeneSight ASP for several quarters. And as we've been successful in leveraging policy changes or plans updating their coverage position relative to GeneSight in states where they've passed biomarker laws, we continue to focus on that and see opportunities ahead.

I will mention, it's important for folks to recall that when you look at 2025, Q1 was the softest ASP quarter for GeneSight. And so we were pleased with the growth that we saw this quarter. We expect this quarter to be viewed as a baseline for ASP and something that we can continue to focus on building on.

One moment for our next question, comes from Brandon Couillard with Wells Fargo.

Sam or Brian, on the prenatal business, I mean, on one hand, test volumes were up a smidge sequentially, but at the same time, the year-over-year trend is still decelerating. And historically, 1Q kind of tends to be the high watermark for the year. So is it really reasonable to expect that prenatal volumes grow for the year? And how confident are you that kind of the internal issues are mostly behind you at this point?

Yes. No, I'll start here and then Brian, if you can add and Ben, you're welcome to is the internal ChatGPT and the historian of all things Myriad.

Yes, first, Brandon, let me acknowledge that the prenatal volumes were a bit softer than we expected for the quarter. That is a fact. That being said, we have been pleased that with the level of interest and the ability that Brian's sales team has been able to, particularly with new customers, to be able to start driving new business there. Again, part of what gives us confidence in being able to return to growth is 2 other things, right? And sorry, Brian, I'm sure I'm taking all your time here.

It's okay.

Is, one, again, the dedicated sales channel. I think in business and sales, what you focus on and how you prioritize it, how little you distract the sales team makes a huge difference. And having absolute focus on prenatal, I think, is going to pay dividends, and that's part of our thesis of why we're confident.

Number two, FirstGene. I can't tell you about how excited we are about FirstGene. You might have heard Brian talk about it in his prepared remarks, right? When it comes to market fully commercially here early in the second half, it will be the first and at that time, probably the only screen that simultaneously screens for the patient carrier, the fetal single gene, fetal chromosome, fetal RHD all delivered in a single integrated report. There is nothing out there that does that and the ability to do that as early as 8 weeks gestational age. So I emphasize this because there is differentiation in terms of value that it provides, and that is, again, part of what gives us the confidence to be able to return to a level of growth.

Brian?

Yes, thanks. I'll just add a couple of pieces on this, but very well covered. So prior year first quarter was a really strong year for us as well. So when you're looking at the year-on-year comparison, it's important to remember that we were building real momentum in the prenatal business prior to that order management issue, which we saw in Q2. And so as we're passing that comp, delivering the consecutive quarter-over-quarter volume growth, standing up our dedicated sales team and launching FirstGene, we think we have the pieces together here to be able to return to growth and again, execute on our full year guide.

We're watching it very carefully. We're being very thoughtful as it relates to our account engagement and as it relates to the launch of FirstGene and how we educate providers about the product offering, but we've got the pieces together here to deliver on our plan.

And one final thing to add, Brandon, because you asked that, and I should have started with that. We haven't had any internal [indiscernible] or operational issues related to the prenatal being able to take the orders all the way through analyzing the samples and returning the reports. We have no issues there at all. And in fact, we haven't had for several quarters. So really, it's about commercial execution and FirstGene being a truly differentiated assay that we think we can start to return to growth with.

Got you. That's helpful. And then, Ben, how should we think about OpEx over the next few quarters? It seems to imply that maybe that line item is flat to down as you move through the balance of the year. Just trying to back into the OpEx line based off the EBITDA guide would be helpful.

Yes, Brandon, I appreciate the question. And so you're spot on. We will manage our operating expenses as we see volume and revenue grow. And so we're committed to profitable growth. When you look at Q1 and you multiply it by 4, essentially will require some phasing of expense in the back half of the year in order to drive that level of adjusted EBITDA that we've guided to, but we're committed to doing that. So I would just repeat, yes, your -- the phasing that you talked about essentially phasing into the year is the way that you should think about it.

Our next question comes from the line of Subbu Nambi with Guggenheim.

As we get closer to FirstGene launch, where do you stand in terms of reimbursement? Have you started to get this contracted? Will the full commercial rollout be a headwind or a tailwind to prenatal ASPs in second half '26?

Thanks for the question, Subbu. And we've definitely been engaging closely as we've been doing the, if you will, the early access on FirstGene. So Ben, why don't you take your specific question of how we think about ASP and we'll be better or different?

Sure. Yes. So as we think about ASP as it relates to FirstGene, Subbu, we will build using existing codes. And so ultimately, as time moves forward, we may move to a specific or an individual code for FirstGene, but that's not where things will start. And our expectation based on experience is that FirstGene ASP will be a boon to overall prenatal ASP.

Yes. I'll just add that as you might be aware, we have a study, the CONNECTOR study, that we're doing and we're continuing to enroll and process samples there. So we had a publication -- sorry, we presented some data at a conference in the first quarter, which showed just really robust performance and also just the value of the assay. And we're pleased with the ongoing number of samples now that we have been able to process as part of the CONNECTOR study.

So when you take the long horizon view, though exactly as Ben said, today, we're using codes we already have. We're also building the optionality of potentially being able to make a case for reimbursement that would be better over time.

And then in the ACOG workshop that you guys hosted, it was clear that FirstGene involves deep sequencing and that you do not complete fetal recessive testing as a reflex, but instead you do it on every patient. Could you speak to the expected gross margin profile of FirstGene? And this is not like anything in the short term, but just overall, is it accretive or dilutive to Women's Health segment on the gross margin level?

Yes. Maybe I'll start here and then Mark, you can jump in, too, and Ben, you can jump in. Yes, you're right again, Subbu, that's what I was answering a prior question that we are taking an approach which we think will provide more value to clinicians that we are providing -- we're doing the analysis at the same time for all the various indications that FirstGene provides. But that being said, I'm really pleased by what Mark and his team have done in terms of operational capabilities. The yield has been -- I'm going to knock on wood here -- extremely pleasing for where we want it to be.

And in terms of gross margin overall, maybe Ben, I'll let you take that part.

Yes. So as I mentioned, from an ASP standpoint, it is accretive to the portfolio. Due to the lab process, it's essentially costs associated with processing the sample will be a little bit higher than our existing portfolio, but we have an efficient and effective process that enables us to have a very short turnaround time. So I would think about that as a singular lab process or processes as opposed to sequential multiple lab processes. And so ultimately, where that lands you is margin accretive to the portfolio. You've got stronger ASP, you've got marginally higher COGS. Ultimately, you've got stronger gross margins.

And our last question comes from Mason Carrico with Stephens.

I think I may have heard you say you expanded your sales team by over 100 reps compared to last year. Are you willing to provide, I guess, a bit more insight into the split of those reps across MRD, prenatal, Prolaris, really just your commercial teams more broadly?

Thanks for the question, Mason. Yes, we are excited again by the expansion, 100 individuals that we've added so far this year. While I won't get as granular as perhaps as you just asked, again the guidance is -- or to help answer your question, the vast majority is related to the Cancer Care Continuum.

So there are individuals who are further helping us grow with reach and frequency for hereditary cancer testing. We believe that continues to be a $7 billion market that is less than 50% penetrated. We are the pioneers in that. So we believe there's a lot of room opportunity to continue growing for some of the resources that have been applied there.

MRD, clearly, an incredibly important area for us, and you've heard us talk about that. So yes, we've added a meaningful number of individuals who have background in molecular to that space. Prolaris as well prostate cancer, that is an area that, along with AI, along with the other things that we've done working on the NCCN guidelines I was talking about, we've added there too.

So I'm sorry, it's probably not the granularity that you're looking for. But we -- what I would leave you with is, yes, we have been very deliberate, Brian is a very deliberate guy, but the primary focus is on the Cancer Care Continuum.

Got it. Okay. And in terms of the back half ramp in prenatal, how dependent, I guess, is that reacceleration on a successful launch and positive reception to FirstGene maybe versus your broader operational initiatives to improve performance of this segment? I think I've heard you guys mention a number of times that that launch is a key opportunity to reengage with some of the accounts where you lost volumes.

Yes. Now, great question. I appreciate it. And maybe I'll start here and Brian, you can build on this. We believe these things come together, right? They are collectively going to allow us to resume growth. The thing is, numerically, we know we have a formula that we can use based on our experience of how much value each sales rep should bring, particularly as they ramp. We have that. That's a formula thing.

We also believe that FirstGene is not only an opportunity -- it's an opportunity to both to regain some share that we've lost, particularly based on some of the challenges we had with our own order management system. And that's based on a number of customers saying to us if you have this product, then we love to work with Myriad because it is differentiated.

I think just -- I answered some of how it's differentiated on a prior question, plus we also have, I think, the industry-leading support for genetic counselors, all those things that are needed on the front and the back end, that's a real differentiator. And we also believe FirstGene is an opportunity to expand the market. Remember, 2/3 of the fathers -- male partners are just not available for one or another reason. So this is a market expansion opportunity.

Brian, is there anything else you'd add to this?

So just to reemphasize, I think, some of the points you made. It is not a one or the other piece, right? And everything you said is spot on, which is FirstGene will be really great for us to be able to reengage with customers. We have expectations in terms of our core business growing, and we have some expectations in terms of FirstGene being adopted.

And based on your question, it felt like you were asking like do we have heroics planned as it relates to FirstGene. The answer to that is no. We have very -- what we think is reasonable growth assumptions in the back half of the year for the launch and for our base business.

And this will conclude the Q&A session. I will pass it back to Matt Scalo for closing comments.

Okay. Thanks, Carmen. And this concludes our earnings call. A replay will be available via webcast on our website for one week. Thanks again for joining us this afternoon, and have a good night.

And this will conclude our conference. Thank you for participating, and you may now disconnect.

Good day and thank you for standing by. Welcome to the Myriad Genetics Fourth Quarter and Full Year 2025 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Matt Scalo, Senior Vice President of Investor Relations. Please go ahead.

Good afternoon, and welcome to Myriad Genetics Fourth Quarter and Full Year 2025 Earnings Call. During the call, we will review the financial results we released today, and afterwards, we will host a Q&A session. Our earnings release was issued this afternoon on Form 8-K and can be found on our website at investor.myriad.com. I'm Matt Scalo, Senior Vice President of Investor Relations.

On the call with me today are Sam Raha, our President and Chief Executive Officer; Ben Wheeler, our Chief Financial Officer; and Mark Verratti, our Chief Operating Officer. Also joining us for Q&A will be Brian Donnelly, our Chief Commercial Officer. This call can be heard live via webcast at investor.myriad.com, and a recording will be archived in the Investors section of our website, along with this slide presentation.

Please note that some of the information presented today contains projections or other forward-looking statements regarding future events or the future financial performance of the company. These statements are based on management's current expectations, and the actual events or results may differ materially and adversely from these expectations for a variety of reasons.

We refer you to the documents the company files from time to time with the SEC, specifically the company's annual report on Form 10-K, its quarterly reports on Form 10-Q and its current reports on Form 8-K. These documents identify important risk factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements. I will now turn the call over to Sam.

Thanks, Matt. Good afternoon, everyone, and thank you for joining us. As we head into the new year, I'm pleased with the progress we're making as the new Myriad to live up to our significant potential by focusing on high-growth market segments, advancing our plans for multiple timely product launches, including leveraging strategic partnerships and by executing with stepped-up urgency and strengthened execution rigor.

I'm happy with how we ended 2025 with fourth quarter revenue of $210 million, coming in above the high end of the preannounced range we provided in January. When you exclude the headwind from UnitedHealthcare's decision on GeneSight, our business grew approximately 4% over Q4 of 2024. In terms of testing volume, we delivered 382,000 test results in the fourth quarter.

Our financial results were supported by continued strong volume growth for MyRisk in oncology at 14% over the year ago quarter and MyRisk for unaffected at 11% over the year ago quarter. These results reflect our ongoing efforts to enhance the customer workflow, including EMR functionality. Mark will provide additional color in his section, but certainly, we continue to see positive demand for our MyRisk hereditary cancer test, and this supports our accelerated profitable growth journey ahead.

I'm also pleased to call out the acceleration in Prolaris test volume growth in the fourth quarter, where the combination of actions over the last 2 quarters, including incremental investments in the commercial team focused on urologists have helped drive 12% test volume growth year-over-year. Fourth quarter prenatal volume declined year-over-year, primarily stemming from Q2 order management disruption.

With this issue resolved, we are now in an active rebuild phase, reactivating accounts, expanding access and driving new customer wins. We expect these actions to support a return to positive growth in 2026. Moving to our mental health business. GeneSight volume grew 9% year-over-year and continued to accelerate from the first half of 2025 as our commercial organization maintained strong execution with new and existing customers.

For the full year 2025, revenue was $824.5 million, and we delivered over 1.5 million test reports by serving over 55,000 health care providers. Turning now to profitability. In the fourth quarter, we reported strong adjusted gross margin of 70% and closely managed our discretionary spend as reflected in our adjusted OpEx line. Ultimately, we reported a healthy adjusted EBITDA of $14.3 million and adjusted EPS of $0.04.

We're also making great progress on our cancer care continuum strategy to maintain leadership hereditary cancer testing while expanding into other attractive cancer testing applications. This includes launching the expanded MyRisk panel in Q4, which has been well received in the market. We're also sharing results from an increasing number of studies in Precise MRD with positive clinical data presented at major clinical conferences.

And we're in final preparation mode to start commercial testing of Precise MRD for breast cancer for a select set of customers in what we call an Alpha launch starting next week. Overall, we're making good progress towards our goal of expanding our portfolio of differentiated testing solutions that provide actionable insights across the cancer care continuum. From a new product pipeline perspective, 2026 is shaping up to be a banner year.

Throughout the year, there are a number of important catalysts that we will be tracking that supports this year's growth. But even more, these are leading indicators of key growth drivers for 2027 and beyond. We're making significant progress on a number of catalysts outlined in this slide. Our strong fourth quarter test volume growth for MyRisk reflects ongoing traction of our breast cancer risk assessment programs and the launch of our expanded MyRisk test.

We plan to launch disease-specific panels for MyRisk in Q2 and expect our market activation programs and product extensions to support increased MyRisk growth. Building on Prolaris' strong fourth quarter performance, we're on track to launch our first AI-enhanced Prolaris prostate cancer test in Q2 that combines the power of molecular and AI analysis, and this is based on our partnership with PATHOMIQ.

On Precise MRD, as I noted earlier, we're on track to commence commercial testing for select set of customers next week, and I'll provide additional color on the next slide. At JPMorgan Healthcare Conference in January, we reconfirmed that our first Precise MRD test will be for breast cancer and announced additional indications that will follow. We plan to submit for MolDX and expand commercial testing for early access customers for both renal and colorectal cancer in the second half of the year with commercial launch of breast, renal and colorectal planned for 2027.

All of these Precise MRD tests have a growing body of clinical validation, some of which has been shared recently in venues, including presentations at the San Antonio Breast Cancer Symposium in December, ASCO GI Symposium in January, where a first look at Precise MRD data related to colorectal cancer was presented by collaborators from National Cancer Center Hospital East in Japan, showing how the ultrasensitive detection of Precise MRD can have additional benefits compared to first-gen MRD tests.

And to round out the robust 2026 pipeline, we're on track to launch first gene multiple prenatal screen tests in the second half of this year. The timing of this launch dovetails nicely the deployment of a focused prenatal health sales team next quarter and the expected early results of the CONNECTOR study in the next few months. As we prepare to achieve the important milestone of commencing commercial testing for select set of customers with Precise MRD for breast cancer patients next week, I want to help frame expectations at this stage.

This slide highlights our three objectives. First, we're looking to further showcase Precise MRD's clinical performance while continuing to build the body of real-world evidence. To date, data shows Precise MRD's high sensitivity and ability to detect disease down to 1 part per million. We believe our MRD platform can help guide clinical decision-making for patients in their journey in cancer care and has the ability to detect presence and recurrence meaningfully earlier than the standard of care with imaging and therefore, can positively impact patient outcomes.

Second, nearly 85% of cancer care in the U.S. happens in the community. That's where Myriad has a strong established presence where we serve nearly 3,500 oncologists in 2025. We've seen strong interest from our community oncologist base to participate in the Alpha and early access stages of our commercial rollout. Clearly, this is an encouraging sign.

But we also remain disciplined regarding the overall number of participating centers in these early stages of launch to ensure good customer experience and manage our profitability. We will look to expand the number of centers as we move through 2026. And the third objective is to track and learn from specific metrics appropriate for this early stage. After all, you get what you measure, and we'll look to provide an appropriate level of visibility into these metrics moving forward, starting with the Q1 earnings call.

While we're excited and busy preparing for multiple launches this year, I want to reiterate that there is little to no contribution from these MRD tests in our 2026 revenue guidance. Going into 2026, we're taking a number of actions to accelerate growth. This includes our plan to invest over $35 million over the next few years to support a number of initiatives to accelerate organizational efficiency, agility and growth.

These initiatives include strengthening our commercial capabilities, particularly in the cancer care continuum. Specifically, we're adding a meaningful number of sales and medical headcount ahead of multiple new product launches this year. Many of these new additions come from advanced diagnostics sector and bring strong domain knowledge and experience in molecular profiling and cancer diagnostics, along with relationships across the oncology health care community.

In addition, we're strengthening the tools critical to our sales team while implementing a comprehensive plan to drive awareness, excitement and demand for our products. I attended our commercial kickoff meeting last month hosted by Brian Donnelly, our Chief Commercial Officer, and I can say our teams are energized and highly motivated to win in the market. Now let me hand it over to our COO, Mark Verratti. Mark?

Thanks, Sam. Turning to fourth quarter oncology. Total oncology revenue was $84.7 million, growth of 2% over the fourth quarter of 2024. I would like to highlight our MyRisk test continues to gain share with fourth quarter 2025 year-over-year volume growth of 14% in the affected market and 11% in the unaffected market. Shifting to prostate cancer. Prolaris revenue growth in the fourth quarter accelerated to 16% year-over-year, up from 3% year-over-year revenue growth in our third quarter.

Fourth quarter Prolaris revenue growth was driven by 12% volume growth, reflecting a continued improvement year-to-date. As mentioned on previous calls, we are investing in the commercial channel and other programs to grow and regain share in this market. Adding to what Sam mentioned in previous calls, Myriad is on track to be the only company that will offer AI, biomarker, germline and tumor profile testing when we launch our first AI-enabled Prolaris test in the second quarter of 2026.

In January, we issued a press release outlining our MRD commercialization time lines and clinical evidence presented at recent clinical conferences. Our ultrasensitive Precise MRD test continues to demonstrate strong clinical value in these studies, which now includes data on colorectal cancer patients, where we saw 100% baseline ctDNA detection across all patients. Approximately 20% of samples were detected at levels in the ultrasensitive range that may have gone undetected on first-generation assays.

This supports strong performance of Precise MRD. As Sam mentioned, we're excited to begin offering our ultrasensitive Precise MRD test next week. Initially, this launch will be limited to a number of oncology centers, ones we believe best reflect a variety of needs across the community oncology setting and breast cancer patient. This early launch provides the opportunity to engage these providers and incorporate their feedback about a host of topics, including the ease of use and overall utility and actionability of the test.

As we move ahead, we'll plan to expand the number of centers in a controlled manner until full commercial launch. Now moving to our Women's Health business. In the fourth quarter, Women's Health delivered revenue of $88.5 million, an increase of 2% over prior year period. We're pleased to see another consecutive quarter of incremental growth in hereditary cancer testing in the unaffected market with revenue growth of 3% and volume growth of 11% year-over-year.

This improving volume growth trend is particularly important as it reflects EMR-related workflow improvements put in place, such as the September integration of our MyGeneHistory assessment into Epic as a way to better identify patients that qualify for hereditary testing and improve the provider experience. So we continue to be optimistic about the potential for continued momentum.

We also remain confident about our ongoing progress from breast cancer risk assessment programs that enable providers to rapidly identify patients who qualify for additional screening. We continue to see positive momentum at these sites and expect to make further investments in our commercial capabilities to accelerate this program through 2026 to fuel growth in MyRisk volume.

As for prenatal testing in the fourth quarter, we saw a modest pullback in volume growth from previous quarters as we continue to work with accounts affected by friction created by the second quarter implementation of a new test ordering system. While we are optimistic on our ongoing engagement will win back share and drive overall growth in 2026, prenatal volume growth in the first quarter of 2026 will face a difficult year-over-year comparison, likely leading to a decline in year-over-year volume growth.

As for our new multiple prenatal screen, FirstGene, last week, we published the analytical validation of FirstGene in clinical chemistry. FirstGene is an integrated solution for multiple pillars of prenatal testing, and our paper shows excellent accuracy and reliability for each pillar. We continue early access clinical testing with our CONNECTOR study seeing positive enrollment momentum, and we are pleased with our turnaround times, assay performance and early customer feedback.

We are reaffirming our full commercial launch in the second half of 2026 and are investing appropriately ahead of this launch as FirstGene provides added insight and has the potential to expand the overall addressable prenatal testing market. Turning now to mental health. In the fourth quarter, the team generated GeneSight revenues of $36.6 million on volume growth of 9% year-over-year.

We continue to drive expansion of the ordering provider base, achieving a record number of ordering clinicians to over 38,000 in the fourth quarter. This strong fourth quarter volume performance is worth highlighting as Myriad remains disciplined and focused on capital efficiency in this group.

While quarterly revenue continues to be impacted by UnitedHealthcare's coverage policy change in January of 2025, we are proud of our clinical development and payer market teams for securing positive coverage policies across 12 payers for GeneSight in 2025 related to biomarker laws, including the California Medicaid program, Medi-Cal. In addition, we are seeing benefit from optimizing revenue cycle workflows to maximize reimbursement. I will now turn the call over to our CFO, Ben Wheeler.

Thanks, Mark. As Sam and Mark highlighted, we're seeing clear momentum from the operational and commercial progress made throughout 2025. Let me start with a recap of our fourth quarter growth drivers. We generated another quarter of strong test volume growth in hereditary cancer testing, achieving 9% year-over-year growth in the fourth quarter and 7% year-over-year growth for the full year 2025. This acceleration in the fourth quarter reflects continued double-digit growth in our unaffected market.

Likewise, GeneSight finished the year with strong momentum, generating test volume growth of 9% year-over-year in the fourth quarter and 6% for the full year 2025. This progress reflects commercial discipline and effectiveness of the actions taken in early 2025 in response to UnitedHealthcare's coverage decision.

The reacceleration in both unaffected hereditary cancer volumes and GeneSight volumes is a clear proof point that our commercial performance is strengthening and that the actions that we've taken to enhance focus, accountability and effectiveness are translating into tangible momentum. Moving to the consolidated financial results. For the fourth quarter, we reported revenue of $209.8 million, above the high end of the range pre-announced on January 12 and consistent with the year ago period.

Overall, test volumes grew 2% year-over-year, while average revenue per test declined 2% year-over-year. The headwind in fourth quarter average revenue per test reflects the impact from UnitedHealthcare's policy change with respect to GeneSight coverage. Despite the average revenue per test headwind, underlying demand continues to be strong. Excluding UnitedHealthcare's net impact on GeneSight of $8.1 million, our underlying fourth quarter 2025 revenue growth rate was 4% year-over-year.

We generated 70% gross margins in fourth quarter, in line with our third quarter, but down approximately 190 basis points year-over-year. This decline was driven by the revenue headwind I just mentioned that affected GeneSight average revenue per test. Fourth quarter adjusted operating expenses decreased by $7 million year-over-year, reflecting disciplined cost management and the timing of investment as resources were deliberately redirected towards commercial and R&D initiatives that will ramp and be reflected in first quarter spending.

We remain committed to balancing strategic investment to support our long-term growth with continued progress toward improving profitability while ensuring capital is allocated to our highest impact priorities. Taking all of that into account, we generated adjusted EPS of $0.04 or $0.01 above the year ago period. Next, I'll speak to Myriad's profitability and liquidity. We generated $14.3 million of adjusted EBITDA and $17.9 million in adjusted operating cash flow in the fourth quarter.

These results reflect the strength of our gross profit base, the operating leverage inherent in our business model and the meaningful earnings and cash flow potential of the business as we continue to execute. We also maintain a solid balance sheet with access to $225 million in capital. As a note, we intend to file a universal shelf registration to replace our existing shelf. We view maintaining an effective shelf registration as a prudent corporate housekeeping measure.

Next, I'll address financial guidance. We're reaffirming our full year 2026 financial guidance, which we issued on January 12, including a revenue range of $860 million to $880 million, and adjusted gross margin range of between 68% and 69% as well as an adjusted EBITDA guidance range of between $37 million and $49 million. In order to support investor modeling for 2026 by quarter, we provided additional commentary in the earnings release, and I would like to highlight a few key points.

First quarter revenue is expected to be between $200 million and $203 million, representing 2% to 4% growth over the year ago period. As happens in most years, first quarter average revenue per test tends to be lower than fourth quarter due to items such as the resetting of insurance deductibles. In addition, as Mark mentioned, prenatal volume and revenue are expected to face unfavorable year-over-year comparisons in the first quarter, leading to a year-over-year decline in this portfolio.

We anticipate prenatal to demonstrate year-over-year progress likely beginning in Q2. Also consistent with recent years, revenue in the second half of the year is typically stronger than the first half. We expect this pattern to repeat to a similar degree in 2026. This outlook is supported by current business trends and anticipated improvement in prenatal portfolio and early contributions from recent commercial investments.

As a result, we expect quarterly revenue to grow sequentially from first quarter through the remaining quarters of the year. I also want to make investors aware that beginning in first quarter, we plan to simplify how we present and discuss our business to better align with our refreshed strategy and how we're operating the company. Going forward, we'll organize our reporting around our strategic areas of focus with the first group being the cancer care continuum.

This group will incorporate all hereditary cancer testing, including both affected and unaffected populations and all tumor profile testing. This will be followed by prenatal health, which will include our NIPS and Carrier Screen lines as well as SneakPeek. And lastly, we'll continue to report mental health as a distinct category.

We are making these changes because it provides clear visibility into the core drivers of the business and better aligns our external reporting with how we operate and allocate resources to our strategic priorities. We're confident in our full year outlook and the team's execution as we enter 2026. Now let me turn the call back to Sam.

Thanks, Ben. Let me conclude by saying this is an energizing time for the new Myriad. We are at an inflection point where we have the absolute clarity and conviction for our go-forward strategy with a particular focus on the cancer care continuum. We have a robust pipeline of new products and enhancements for attractive market opportunities, mostly developed internally but also complemented with ones enabled through strategic partnerships. Yes, we are the hereditary cancer company, but we are more than that.

And many of these new products will strengthen our position across cancer care testing. Along with that, we're going to leverage our operational strengths for sample processing and reporting while expanding our commercial capabilities and customer reach. We have a stronger leadership team now, both from my direct staff and the next level with a needed blend of diagnostics, cancer and genomics domain knowledge combined with proven experience for delivering results.

Along with all this, we're taking steps programmatically and culturally to strengthen execution excellence. Put it all together, we have the substance and confidence to positively impact an increasing number of patient lives and to accelerate profitable growth. I now pass the call over to Matt for Q&A. Matt?

Thanks, Sam. As a reminder, during today's call, we use certain non-GAAP financial measures. A reconciliation of the GAAP to non-GAAP financial results and a reconciliation of GAAP to non-GAAP financial guidance can be found in our earnings release and under the Investor Relations section of our website. Now we're ready to begin the Q&A session. [Operator Instructions] Operator, we're now ready for the Q&A portion of the call.

And our first question comes from Puneet Souda of Leerink Partners.

First one, maybe, Sam, just given the momentum or the recovery that you're focused on for the full year, do you -- I was trying to understand what gives you confidence that we can continue with this sort of high single-digit long-term growth rate that you had before and what you're projecting for the year, is that how should we think about sort of 2027? Can we -- or can we return back to that high single-digit growth rate? Let me just pause there, and I'll come back with another question follow-up.

Yes, Puneet, thanks for the question. Well, first, let me start with 2026. And the drivers of our growth this year, again, it's a number of products that we have already launched coming into the year, be it the expanded MyRisk panel in Q4 of last year. It's improvement that we're seeing across the board, both in commercial and other parts of our organization and execution. So we're getting better at that.

We are also -- as we get along the year, we're adding headcount to go along with new products that we're launching and so forth. So based on what we have, the recovery of the prenatal business that we anticipate that we've spoken to happening over the next several months and quarters, we feel confident being right there in our guidance range, right? That's what we feel for this year.

Listen, when you look at 2027 and beyond, as I've said recently at the JPM conference in January, we believe that we have a number of levers in place. I'll again point you to the catalyst slide, which talks about a number of new products, right? We have 3 major launches this year, starting with Precise MRD for breast and other indications as well, AI-enabled Prolaris for prostate cancer as well as FirstGene, right?

All of these things, I think, will be important that we're timely in our launch. But truly, these become even more growth drivers for 2027 and beyond. So I would summarize second part of your question and that we have confidence that as we exit this year going into '27, '28 that we will be on path for high single-digit to low double-digit sustained profitable growth.

Got it. That's helpful. And then on the MRD launch, I appreciate the details you provided, but just wanted to get sort of how do you plan on holding back? I mean, is it certain indications just given the sort of the competitiveness of the market and competition in the market and also the fact that currently, the products are not reimbursed, but you're on a path towards that.

So maybe just talk to us as to sort of how you plan to throttle it back and then accelerate sort of into the second half of the year and beyond? And then on prenatal, if I could just squeeze in, how should we think about the growth rate in the first quarter? I know it's down but just wanted to make sure if there's a finer point on that and then the recovery through the rest of the year.

Yes. Let me take the MRD question, and then Ben, if you can answer the prenatal question here. Yes, from an MRD standpoint, we are excited again. As I said, it's next week, we're going live. We're going to start commercial testing, and it is for what we're calling our Alpha phase of the launch, select number. So we are being selective, Puneet. It is a little bit challenging in a good way that we've seen a lot of interest to have access to precise MRD, but I believe we can do it in a balanced way.

I mean, again, in this phase, what we're looking for is input on the user experience all the way from ordering to the reporting, the number of repeat orders, the operational efficiency that we have and ultimately, the order volume that we have. And as we noted, our MolDX submission is planned for early H2, so you can call it Q3 for breast and then later in '26 for renal and colorectal cancer.

So until we have submitted for MolDX, we're going to be a little bit more careful on the volume we take on. But we have a path. And listen, it will be something we will carefully consider as the year goes by of are there merits to increase the volume? What do we think on the timing of MolDX? So as we sit right now, we're pleased, particularly with the start of Alpha for Precise MRD and breast next week. Ben, over to you on prenatal.

Thanks, Sam. So as it relates to prenatal, Puneet, as a policy, we don't generally offer product level revenue guidance. But we did call out the prenatal Q1 growth and the unfavorable year-over-year comparison because we had noticed that the Street revenue models had a pretty wide range as it related to our prenatal product.

And so we thought it was important to be able to make sure that folks understood that appropriately reflecting our expectation as it relates to the recovery in 2026 is really the only major change needed to get Q1 revenue in line with our updated revenue range of $200 million to $203 million.

Our next question comes from Subbu Nambi of Guggenheim.

At JPM, you laid out an ambitious MRD launch road map, which you reiterated today. As you think about the puts and takes in that road map, where is there the most risk or the most factors out of your control that could delay your road map? And conversely, are there things that would go faster than what you planned?

Yes. Thank you, Subbu, for the question. In fact, when we think about this year, one of the biggest challenges, if you will, and I think it could be a positive thing is exactly how many samples in advance of MolDX approval that -- for Precise MRD that we run. Some of the things that are, as you're asking, out of our complete control are just how long and how many cycles it might take MolDX to do the review, provide us input and ultimately for us to get approval.

What we can control, and I think we've been doing a really nice job of is preparing the data and for the submission for the publication. I think I've shared before, we have more than 15 active studies in MRD underway. The MONITOR study is the one, which will inform and provide the publication for breast cancer MRD. And that is on track for us to be able to do that in Q3.

Now the -- for the colorectal cancer submission to MolDX, that's tied. That's part of the pan-cancer study as part of the MONSTAR study that we're doing with our collaborators in Japan. We believe that's on track for the second half, which will be the submission to colorectal.

Now in renal, the good news is we -- in September of last year, we already had a publication in Lancet for renal cell carcinoma. So those things on submissions, that's just to speak to kind of our level of confidence. We have, I think, a decent level of control. It's really about the MolDX timing. And as you know, Subbu, we'll kind of walk that road together, and we'll see how that goes.

One follow-up. Last week, you published a paper of performance data for FirstGene in a prospectively collected set of patient samples. You reiterated the timing for CONNECTOR study in second half of this year, which will be based on real-world samples. Is there any reason to expect the real-world data set to have meaningful difference in performance of the test and the prospectively collected samples?

Thank you. Thank you for the great question. So first, yes, we were very pleased with the results, both on selectivity and sensitivity from about 500 samples that we noted in the press release last week. And we -- until the data is fully there from a broader set of CONNECTOR -- individuals who are enrolled in CONNECTOR, we can't conclusively say, but there is -- we see no reason to believe that the data shouldn't be as robust and compelling in terms of the performance for FirstGene.

And our next question comes from Tycho Peterson of Jefferies.

A couple on margins. So if we look at HCT volumes in oncology, you grew 9%, revenue obviously only increased 3%. Maybe just talk about what specific ASP or payer mix dynamics are driving this gap? And how do we think about this kind of dynamic in '26 as you launch disease-specific panels?

So Tycho, this is Ben. Thanks for the question. Yes, as we talked about ASP in Q3, we talked about that kind of the launching point for Q4 and then moving forward into 2026, I think it's important for folks to take into account that we anticipate a modest headwind relative to ASP when we look at the portfolio in 2026 when you're thinking about what the year will look like.

As you mentioned, from a payer mix standpoint, as we focus on selling the expanded panel and then also the MyRisk more broadly across our sales channels, we've talked about this before where we have about a 10% lighter ASP in the unaffected channel relative to the affected channel.

And I think that we saw that headwind across the portfolio from an ASP standpoint when you look at 2025, really driven by the different mix of payers. Part of it was biopharma revenue that we talked about in -- excuse me, in Q3 with the new baseline moving forward. And then another part of it is you just see a shift in the different payer mix from one payer group from a Blue Cross Blue Shield group to another group or something along those lines.

Okay. And then on Precise, I appreciate the color on kind of the Alpha rollout. Maybe just talk a little bit about how you think about scaling up on the sales and commercial channel there. Obviously, more of a '27 driver overall. But just talk a little bit about how you're thinking about hiring for the various indications.

Yes, sure. Maybe I'll start and then I'll allow Brian Donnelly, who's here with us to join in. I'll just say that the scale-up and the preparation for the launch has been underway for some time, and it includes training the existing team, making sure we're hiring people with the right profile, meaning understanding of molecular. And beyond just the sales team, it's also our medical folks, MSLs and a lot of that's already happening. But Brian, please?

Yes. Thanks, Sam. This is Brian. So just building on what Sam said, we're really focused on making sure we have the right level of reach and frequency to priority targets, which you won't be surprised to hear us say. So we're just taking a consistent view at the market, making sure that we are hiring the right level of folks in the right territories, and we're training them, which is a really important piece of the puzzle. We want to get them ready to go as quickly as possible to make an impact.

And Tycho, I'll just add to that. We've mentioned -- I mentioned again earlier in my prepared remarks that we're spending over $35 million over the next couple of years. And a very big part of that is to augment our sales team. And those additions are underway as we speak. In fact, we had our commercial meeting kickoff just a couple of months ago, and there's a lot of new faces in the room. They're coming from places where they've done this already. So they're not just going to be learning on the job.

Okay. That's helpful. And then maybe just along those lines and lastly, just on the Alpha launch, can you just provide any more color? You talked a little bit about how you're thinking about number of tests you need to run, but maybe the customer profiles you're going to target.

Sorry, I didn't know if you got cut off. Did you just say can I provide any more color? Is that what you said?

Yes. On the Alpha launch, I mean, you talked about a number of tests you may target, but in terms of...

I'm going to go with that. Listen, we are...

Ladies and gentlemen, please remain on the line, your conference will resume shortly.

Yes. Apologies, Tycho. I got cut off. So I think what I was answering your question about Alpha is we're excited about the launch. We're starting off with a handful of community oncology centers. And by the end of the year, as we move into early access, we're going to broaden that into dozens of actual accounts. We have already done the training to prepare these sites. We have sample collection kits in their hands. So we're looking forward starting next week to activate fully and start receiving samples and can't share enough the excitement that we have to start.

And our next question comes from Doug Schenkel of Wolfe.

My first one is on Prolaris, where ostensibly, you picked up some momentum into year-end. As you noted in your prepared remarks, the recent volume was up low double digits was because of the favorable comparison. Can you delineate between how much of it was the comp versus improved rep productivity or any other dynamics that you think are worth calling out? That's my first question.

On an unrelated topic, my other question is on prenatal momentum into year-end. Units were actually down, I think, 5,000 or so sequentially in the fourth quarter. I just want to see if there were any remaining order management dynamics. And if so, how is that contemplated into 2026 guidance? And beyond that, are there other things that are worth talking through like competitive dynamics, for example, that may have affected trends into year-end?

Yes. Thank you, Doug, for the questions. Let me start with a question on Prolaris, and then I'll hand it off to the combination of Ben and Brian to talk about prenatal. Listen, there have been a number of activities that we've been working on over the last few quarters actually related to Prolaris. It includes the engagement we've had with KOLs; it includes the various programs we've been driving. It includes the expansion of our sales team into more -- serving more urologists.

So all of those things are things that we think will endure. Now yes, did we potentially get a little bit of a compare benefit in Q4? That's possible. But as we look into 2027, we expect maybe not the 12% growth that we had within the quarter, but much stronger and actual growth throughout the year in 2026 than what we saw in 2025. So moving on to the prenatal question, Ben, let me hand it to you and Brian to answer that.

Sure. Thanks, Sam. And I was just going to make one comment relative to Prolaris urology, Doug. So as Sam mentioned, we've focused on that channel executing with the sales force, and that gives us confidence as we look at 2026. So like Sam said, we don't expect, or we didn't model out a 12% year-over-year growth going into '26.

The guide did reflect some traction relative to the total annual growth rate that we saw in '25 moving into '26, and we're bullish about the opportunity ahead as we see the performance that we saw in Q4. Now transitioning over to prenatal. You're accurate in the view that volume declined in Q4. Typically, Q4 is often a challenging volume quarter period, all else equal, not simply saying that, that is the year that we had for prenatal in 2025.

But when you look at the seasonal or the quarterly volumes from a prenatal standpoint, oftentimes, you'll see a softening in Q4. We did see softening in Q4. And as we mentioned in the prepared remarks and then also, as I briefly shared with Puneet, our expectation is that we'll see a decline in prenatal year-over-year in Q1 with recovery in Q2 and beyond.

And there are several things that give us that confidence. Part of it is having a focused sales force as they focus on our prenatal bag and Brian can speak more to that. The early traction that we're seeing in conversations with GeneSight and FirstGene, excuse me, as providers will be interested and open to conversations as we work to win back share as well.

So I do want to emphasize the fact that the guide does not include a sizable benefit from FirstGene, but we do believe that as we launch that product commercially, we'll have an opportunity to have conversations with docs that will give us some traction or leverage across the portfolio.

It's Brian. Just a couple of adds for that. So [Technical Difficulty] order management issue that we have been working to resolve throughout the year. What we have seen underneath that is accounts who are not impacted by our order management issue are growing at or above market, which is a good signal for the underlying health of the base. In the same period of time, we've been focused on adding new customers. Our sales team has been really focused on restoring the accounts where we lost volume.

And if you go forward into this year, Sam mentioned earlier, we have our prenatal sales team that we're going to be expanding going into the second quarter, and we have the FirstGene launch. So I would just align fully with what Ben said, we do -- Q1 is going to be the beginning of this year for us. We're excited to get out into Q2 and into the back half of the year when we got our new -- our expanded team and our new product.

And our next question comes from Andrew Cooper of Raymond James.

Maybe just a follow-up on that. I do want to drill in a little bit more on just how many customers are left that kind of are affected by this -- by the change at this point? Is it a few important ones? Is it kind of more widespread? I just would love a little bit of kind of color there. And then what other parts of the portfolio maybe need some updates to some of your systems? And at this point, how are you balancing those risks and thinking about it differently than you were before sort of this hiccup in prenatal?

Maybe I take the second question first. Thank you for the questions, Andrew. And then Ben if you and Brian, if there's anything you want to say with the first question. We take it incredibly seriously, Andrew, and we took the opportunity when it happened in Q2 of last year to look through every ordering that we have and to really ensure that everything was intact, that we had no issues, no friction either in the test ordering system or in the reporting system.

And what we really learned is as part of improving execution excellence, it's about a different level of rigor and testing that we'll do before we go live with something, right? This was a self-induced error that we had, which we shouldn't have, and we did, and we've taken care of it. But we have gone through all our other testing -- all of our -- excuse me, ordering systems, and we feel good about all of those continuing to work as they are without any issues.

So building on that, as Sam mentioned, we [Technical Difficulty] to win back the customers that encountered that challenge, we see some progress there, and I'll have Brian speak to that in just a moment. But I think it's important to recognize that as we have the opportunity to go back in there and reengage in conversations, being able to speak about a new product is an opportunity that opens that conversation or opens the door that we have not necessarily had the opportunity to leverage or open over the last couple of quarters.

And so again, not to be too repetitious here, but that's one of the things that really gives us excitement about the ability to move forward and see year-over-year growth as we move in Q2 and beyond.

Yes. This is Brian. I don't have a lot to add to that other than as it relates to where we're at now, we have a really good handle on our current accounts. We understand their needs. They are adopting our portfolio. We feel really good about our current customers and our relationships with them. So we feel like we are stabilizing there.

Okay. Great. And then maybe if I can just sneak one more in. Just on GeneSight, you talked about the 12 payers and the biomarker bills that you added in '25. How should we think about the trend in ASP there for '26, knowing that you're past sort of the big headwind here that you've been facing for the last year or so?

Yes. So we've been really pleased to see the traction that's come as we've engaged in states with biomarker bills and the wins that we had in 2025. Those wins came across the year. And so there's going to be an annualized benefit to some of those that we didn't see in '25, but none of them in isolation are a sizable win. And so when we think about '26 from an ASP standpoint, again, across the portfolio, we're expecting a modest headwind. As it relates to GeneSight, we just think about it as being stable.

Ben, let me just add to what you said. Sorry, Andrew, is that the good thing, well, if you will, we have a much more balanced portfolio, if you will, of payers now. Unlike what had happened with United, even if we were to lose another payer unless they were to be Medicare and there's no sign of that. We feel that's completely stable. We're in a much better place than we were [Technical Difficulty].

Our next question comes from Dan Brennan of TD Cowen.

Maybe just on hereditary cancer. Can you just walk through a little bit kind of what's assumed this year for volume growth? You had some nice growth this quarter. I think comps are a little easier. Just wondering how we might think about the volume growth in hereditary cancer going forward.

Yes. So Dan, when we think about '26, we think about high single-digit growth from a hereditary cancer portfolio perspective, and that's across both unaffected and affected. Obviously, exiting the year with the momentum that we had continues to add how bullish we are about that, but that's how we're thinking about it in '26.

Okay. Maybe just on pricing. I think you said you have a headwind on the whole portfolio. Can you just give a little bit more color on that? Like is there a specific dynamic in '26? Or just how do we think about that?

Yes, Dan, I wouldn't think about it as a specific dynamic per se for the portfolio. I would just think about it just generally as we experience price pressure in hereditary cancer, you think about the dynamics for GeneSight, net-net, we expect the portfolio to have a very modest decline, 1% to 2%.

And so obviously, there's individual dynamics for different [Technical Difficulty] there in '25. We'll continue to engage with payers, and we're excited about the ASP that FirstGene can bring to the portfolio as a modest improvement for our existing prenatal portfolio. But just generally, when you think about the enterprise ASP, that's how we think about the modest headwind of 1% to 2%.

And maybe just one more, sneak one in. Just on MolDX and MRD, like -- so do you assume you get the coverage in the back half of the year and then you have some revenue contribution from that coverage in the model? Sorry if I missed that.

No, Dan, we did not. We're not assuming that we would get coverage until sometime in 2027. So we're assuming really no revenue from MRD in our 2026 numbers.

And our next question comes from Mason Carrico of Stephens.

A lot has been asked. But on FirstGene, I guess, what do you view as the largest practical barrier to scaling adoption and revenue for that assay in 2027? I mean, is it clinical confidence? Is it workflow integrations, payer coverage, sales execution? I guess, which barrier do you feel the most confident that you can clear early, which do you think takes more time?

Yes. Thank you for the question. I'm going to let Brian, if you don't mind.

Yes, sure. Thanks for the question. So with regard to FirstGene, for us, as you know, this is a new product. So it is really about getting the product in front of our providers, both our existing base as well as new customers we're interested in doing business with.

And so it is going to be the traditional issue of getting folks aware of the product, making them ensuring they understand the product to a degree where they're willing to clinically adopt it and then pulling it through. There isn't like a particular issue here other than just really good execution, getting the product in front of customers and being there for them when they're ready to start using it with their patients.

Brian, if I can just add to that, I think that we've been pleased with the early access period that we've had so far, both in terms of input we've received from customers that have been using it, from our own operational efficiency that we've seen in a very high yield and also though it's still relatively early from the reimbursement that we've gotten. So all those things you mentioned, we're not going in blind.

We have a pretty good sense of it. The other thing is we want to have higher market share, and we intend to in the coming quarters and years. But from where we are, we see FirstGene, particularly this combined screen as an opportunity to expand the market, at least for us and to go gain new share, and that's something that is really, I think, important to our future.

Got it. And then could you talk about the progress you've made in terms of cross-selling multiple assays across customers or really just growing wallet share. Are there any metrics you can provide to highlight how maybe an increasing percentage of your customers are ordering more than one test from the Myriad portfolio or any update there?

We will likely share something along the lines as we get deeper into this year. But what I can say, we -- again, we have intentionally gone to focus sales organizations. Again, as we've mentioned, for prenatal health, we are kicking that off in Q2. So that's going to be even more of a focus now with Prequel, Foresight and FirstGene that will be coming.

In oncology, I can give you an example on the urology channel, we are pleased that along with Prolaris, there are a number of customers, increasing number of customers who are also using MyRisk our hereditary cancer test because that is written into the ASCO guidelines for those who are in the course of being treated for prostate cancer.

So fundamental, the great question to [Technical Difficulty] differentiated, and we really believe [Technical Difficulty] is our strong established relationships in community medicine as it relates to what we call the cancer care continuum because there, what we are finding we [Technical Difficulty] relevant tests in the course of treatment.

So we fully expect, and the numbers are things we're going to track here between hereditary cancer, between our comprehensive genomic profiling tests, between MRD, there should be a growing connectivity and a benefit by being in an account serving it. So great question, and we'll look to share more of that in the coming quarters.

And our next question comes from Bill Bonello of Craig-Hallum.

I just want to circle back to your response to Tycho's question on the hereditary cancer ASP, and then I do have a follow-up to that. But -- so I totally understand the price differential between affected and unaffected. But obviously, the ASP was down in both of those groups this quarter.

And so -- and then later, you made some comments about the pricing headwinds and pressure. I guess I'm trying to understand, is that really simply payer mix difference? Or are you seeing your contracted rates for MyRisk going down from where they had been?

Yes, Bill, I appreciate the question. So the short answer is no. We are not seeing contracted rates going down. We're not experiencing pressure in that regard as we have conversations with payers. Really, as we think about ASP, as I mentioned, Q3 is a reflection of the mix that we expected going forward.

We saw that be consistent in Q4, and that's the way that I would think about it into '26, use Q3, Q4 as the ASP baseline, recognizing that in Q1 with deductible resets, there's going to be ASP pressure across the portfolio that will then generally recover through the remaining 3 quarters of the year.

Okay. And when you say mix, not necessarily mix between affected and unaffected but mix like payer mix.

That's correct. When you think about volumes coming from a particular payer versus a different payer versus patient portion.

Yes. Are you guys still there?

We're here. Yes. Can you hear us, Bill?

Yes, you've been kind of breaking up, might -- probably just my phone. So the follow-up is just you talked about a change in the way that you're going to show the numbers, which sounds like it will maybe make it easier for all of us. I'm just curious if that change is reflecting any underlying change in your go-to-market strategy for the various businesses.

I mean you've talked about the focused prenatal team. Will there be changes in who is actually selling for instance, MyRisk into the unaffected market? Or will current salespeople have essentially the same bag they've had all along?

It's a great question, Bill. Yes, we are making changes. So again, a quick summary. In October, we shared that we made a number of changes organizationally. We went away from what we used to call the business unit structure with women's health, oncology and so forth.

And to cut to the chase, yes, now we have determined through our strategy focused channels, meaning now those folks that are in prenatal that we're going live with this coming quarter, they're selling prenatal products. Again, that's Prequel, Foresight and FirstGene, and they will not be carrying the unaffected -- excuse me, they will not be carrying MyRisk, if you will, to serve the unaffected population.

Likewise, we have said that there can be more, we believe, more traction by having a team that is really focused on serving hereditary cancer [Technical Difficulty] that supported a number of marketing initiatives to drive awareness, drive market activation, both directly what we're doing and through partners and through other channels we're driving. So it is a very intentional way [Technical Difficulty] more efficiency and growth and eligibility through the reach and frequency that we intend to execute on.

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And our next question comes from Lu Li of UBS.

I guess my first question on the MRD. I think you mentioned that you're planning to kind of like disclose some of like early-stage metrics. I wonder if you guys have like internal targets for like, for example, like per center utilization, like how do you measure success for those metrics?

Yes. No, great question, Lu. Appreciate it. Yes. So among other things, the 4 things that we will be looking at is user experience for those that are part of the Alpha. And when we say user experience, it's all the way from how their perception on ordering, on the turnaround time, on the quality of the results, the reporting, how easy it is to interpret and take action from it. So that's one category.

Repeat orders, I think that one is pretty obvious. It's important that we see oncologists, health care systems, the same ones continuing to order for multiple patients. and order volume, though we're not disclosing that, we are looking to see that we are able to achieve a certain number of volume of orders here within our Alpha time period, if you will.

And then operational efficiency, that's -- those are the other things that will ensure that we're able to scale and prepare to scale more that includes our internal yield turnaround time, our targeted COGS and other elements. So those are the metrics that we'll be tracking.

Got it. One question for Ben. I think the guide talking about the EBITDA margin going to be like near breakeven in Q1. I wonder, can you comment on the pacing of that? And anything else that you wanted to flag just in terms of like the Q1? Is it just like the prenatal volume headwinds or anything else that you want to flag?

Sure. So yes, we've touched base on the expectation that that's going to be down year-over-year. Also, when we look at historical operating expenses from Q4 to Q1, Q1, we have some outflows just because of the regular cadence of meetings and compensation adjustments and the like.

And so the combination of deductible resets at the start of the year, the impact of prenatal year-over-year decline and then a modest step-up in OpEx starting in Q1 and persisting through the year is what impacts the profitability in Q1. Now I will say when we think about the full year, it's important to remember that we look back across the last couple of years [Technical Difficulty] stronger than H1 revenue.

I just talked about the impact of a step-up in operating expenses that we will titrate as we see some traction with some of our commercial initiatives. But we issued guidance on January 12 as it relates to adjusted EBITDA, and we're still very confident in that level.

This concludes our question-and-answer session. I'd now like to turn it back to Matt Scalo for closing remarks.

Thanks, [ Didi ]. This concludes our earnings call. A replay will be available [Technical Difficulty] for 1 week. Thanks again, everyone, for joining us this afternoon, and have a good day.

This concludes today's conference call. Thank you for participating, and you may now disconnect.

Good evening, ladies and gentlemen. I'm [ Nischal Kapadia ]. I'm an associate with the Healthcare Investment Banking Group at JPMorgan. It's my pleasure to welcome you to the company presentation for Myriad Genetics. Today, we are joined by Sam Raha, who is the President and CEO at Myriad, who will be taking us through the presentation. And Sam is also joined by Ben Wheeler, who will be joining us for the Q&A. Ben serves as the Chief Financial Officer at Myriad.

Thank you very much. Good afternoon, everyone. It's a pleasure to be here and have an opportunity to provide you an update of Myriad what lies ahead. First, forward-looking statements for your pleasure.

So I've been with the company for 2 years now. And from the beginning, I've been inspired by the noble purpose, which is to advance the health and well-being for all. The noble purpose is palpable throughout our organization and a reminder every day how we are making an impact.

A little bit about Myriad. We are a leader in precision medicine and diagnostic testing. We have been a pioneer for over 30 years now since we originally bought BRCA1 testing to make breast cancer, we have over 1,000 publications and counting. We're deeply rooted in science and medicine and in 2025 we served over 55,000 health care providers and delivered over 1.5 million tests, test reports.

Now that being said, we are at a very important inflection point for the company. As we move forward, we're going to build on the strengths that we have, which you can see on this slide, but we're also making a number of changes as we go forward as the new Myriad. Now those changes include having rigor and discipline of where we invest our resources, our time, our energy and of course, our dollars. Our priority, as you'll hear me talk about in a moment, is the cancer care continuum and beyond hereditary cancer we will build a portfolio to serve the full continuum of care.

We also believe in the new Myriad along with the organic capabilities we have for product development, that partnerships can help us serve the market quicker in a number of cases by complementing our capabilities. I also believe that having the right team, which has the combination of the right domain knowledge and experience with the right experiences and capabilities will allow us to move forward. Now hung with that, I get very excited about execution excellence. And this is a step-up level of rigor and discipline in everything we do from product development to commercialization and launch.

We've been using AI for some time within the company, but this is also as a go forward, the opportunity all the way from operations, how we're processing samples, variant analysis to revenue cycle management into customer experience and beyond, you will see that we will increase the adoption of AI, including for our products.

As we move forward, we have absolute clarity on our strategic intent, which is to accelerate growth and profitability. We're going to do so by focusing on 3 strategic pillars. First, the cancer care continuum. Again, this is going to be the heart and the focus of the company and beyond hereditary cancer, we are going to add products for other high-growth applications. Second, for prenatal health and mental health here under health care screening, we will execute strategies to grow at or above market. Now under the moniker here of execution excellence, this is really our commitment to not only to increase the growth for the company, but at the same time to maintain profitability. And we will maintain industry-leading margins. We are going to continue reducing our costs. We're going to use our revenue cycle team, and we also have a mantra going forward that we will grow revenue faster than we grow expenses.

Now on this slide, you see the markets that we serve. They are sizable and most of them are growing in the double digits. And you should also know the majority of these have less than 50% market penetration. For us, as Myriad, we have a top 3 market position in the majority of these important markets. As well, when you look at the new products we'll be launching in the coming 18 months, this together with our position and the incremental adds that we're having to strengthen our commercial capabilities, will allow us to accelerate our growth in this overall $40 billion market opportunity.

Over the next slides, I'll be talking about the cancer care continuum and our expanding of our menu. What you see here is a snapshot of the tests that we currently have as well as the number of tests that we will introduce in the coming couple of years. More important perhaps than any single test on the slide is the comprehensiveness of the overall portfolio because what's important to health care providers, health care systems is to have the tests that serve their need once again across the care of cancer patients. Now that together with the trust that they have in Myriad for the quality of our products, the science, the clinical utility, the turnaround time, the support that we're able to provide clinicians and patients, genetic counselors and beyond are part of the differentiation that we bring forward into the market.

In the next set of slides, I'm going to be providing an update on some specific activities on our product portfolio in cancer. Let me start here by talking about hereditary cancer testing. Hereditary cancer continues to be a sizable important market for us. Between the unaffected, meaning those individuals who don't have cancer but have a familiar reason for being tested between that market and the market for those who actually have cancer and it's part of therapy selection, this total market opportunity is $7 billion. We have the gold standard test for hereditary cancer with MyRisk. And just last quarter, we provided an update, we introduced an update to the market. And now our MyRisk test has more than 63 genes together represent all the strongly recommended genes in the NCCN and ASCO guidelines.

Now coming up within this half of 20 we'll be launching what we call Disease Specific Panels. And these are bespoke predefined panels that are tailored for certain types of oncologists, breast cancer surgeons and others to really help define what they're looking for in a more convenient way without having information perhaps that's distracted.

Now along with that, particularly for the unaffected side, which is a $5 billion part of the overall $7 billion market opportunity, we are the leaders in that space, and we provide something called RiskScore to go along with MyRisk, which really helps determine the level of risk over a lifetime that an individual have for developing breast cancer. We'll be expanding the number of SNPs there for the polygenic RiskScore to 365 in the second half of this year.

Now that, along with the number of programs that we're driving to activate the market. This includes the breast cancer risk assessment program we're enabling health care systems and providers to better identify and pull through patients that are eligible, includes partnerships that we've announced with JScreen, more recently with Clairity Health, with MagView are ways to get into places where breast cancer and other sort of cancers are being tested. We are also going to start activating more of the unaffected market, including consumers through a number of pilots going to do. Put it all together, the takeaway here is that MyRisk is and will continue to be a very important cornerstone for us for both growth and profitability for the years to come.

Moving to therapy selection. This is also a very important part of cancer care with an increasing number of oncology drugs now tied to biomarkers. We are the leader in the HRD with our MyChoice test and in the coming years, we will be expanding the number of indications that we have here. Now for tissue comprehensive genomic profiling, or CGP, we'll be expanding our offering to support precise tumor with IHC stains, starting with PD-L1 later this year.

Now in terms of liquid CGP towards the end of last year, we introduced a partnership with SOPHiA Genetics, along with MSK. And this partnership enables us to leverage the power of a very well-established liquid CGP test, which is the MSK-ACCESS test, together with SOPHiA genetics analysis interpretation capabilities enabled by AI with Myriad's capabilities for lab operations for quality assurance, for regulatory affairs and registration to provide pharma partners as a start the ability to do biomarker selection, biomarker development, companion diagnostic development and ultimately registration and having test as a companion diagnostic available for clinical use. We also have the opportunity down the line to start offering the MSK-ACCESS and SOPHiA package together with Myriad as a quid biopsy test.

Moving to prostate cancer. There are over 300,000 new incidents of prostate cancer in 2025. And there are over 3 million then that live with prostate cancer. We're excited that leader this year, and you can see in the first half of this year, we'll be launching our first-ever AI-enabled Prolaris test. And this is done in partnership with PATHOMIQ. This test will be able to provide a higher level of confidence to urologists and oncologists on the course of treatment of a patient at the time of biopsy to determine what to do in terms of active surveillance or a different treatment path. I will say part of what we've seen really in the market, a lot of energy and excitement for is the ability to offer a test which brings together the power of molecular as well as the power of AI, and that's what this test is.

Now this will be the first of multiple tests that bring the power of AI to market for prostate cancer, our next test will be in 2027. Let me also note that we have clinical studies that are underway now, and the reports and results from those as we share those, we believe, will improve our position as it relates to the NCCN guidelines. Now the takeaway here for prostate cancer and Brad as we are uniquely positioned through our tests of Prolaris AI precise tumor and my risk to bring together the combination of tests, again, for molecular and AI, CGP and germ line testing to really provide a unique answer and support for patient care for prostate cancer. And by the way, we've already started to see in 2025 the, I'll say, the halo effect or an increasing number of patients -- excuse me, providers who are ordering our prostate cancer tests are also starting to order the MyRisk test.

Okay. I want to talk about MRD. MRD clearly is one of the most important market opportunities for our industry and for serving patients. At the heart of our differentiation for MRD is this ultrasensitive precise MRD test. It's a tissue-informed whole-genome sequencing-based test that allows sensitivity for the circulating tumor DNA down to 1 part per million. This is particularly important for low shedding tumors such as breast, such as prostate, renal and other cancers. And it really increases the confidence that providers have on the course of treatment.

Now working with a number of collaborators, including MD Anderson MSK, we have over 20 clinical studies that are underway across multiple cancer types. Now for us, the opportunity to really differentiate and the confidence that we have that over the coming years, we will build a leading MRD business comes from not only the sensitivity and the performance of our assay. But that, combined with the fact that we have a number of other leading tests that are used in conjunction with MRD, again, our hereditary cancer test, HRD test, the growing portfolio of our CGP tests, all that together with the fact that we have leadership presence in the community.

And you might be aware that more than 70% of oncology care in this country happens in the community. We already have relationships with over 3,500 oncologists that we served even last year. So the combination of these things, we believe will allow us to build a meaningful business in the coming years.

Let me share now the high-level plan for MRD. We're starting with breast cancer for a number of reasons. It's a $7 billion TAM. It's a cancer type that is low shedding that really is amenable. Again, that could benefit from the sensitivity that we have. In many ways, we are known as the breast cancer company, given our long legacy starting with BRCA1, BRCA2 as I noted earlier, almost 30 years ago. Our plan here is to start offering select testing for a number of customers actually within this quarter.

We will then submit to MolDX for approval and at the same time, expand the set of customers that we're offering our test to through a regulated early access period. And we're expecting to do that in Q3 of this year. Now giving time for MolDX review and approval, we are planning to launch or expecting to launch commercially sometime in the first half of 2027.

Now in this year, as we go beyond a select set of customers and expand in a regulated way to additional set and early access, we'll be paying particular attention to the overall experience that our customers have. What is their experience with ordering, what's their experience with the clinical utility, the value and equally important, what's the number of orders relative to what we're targeting? What's the number of repeat orders? Are they coming back? What's the input that we have?

Now beyond breast cancer, there's a number of other important things we're doing in 2026. We will be submitting for MolDX for renal cancer. In fact, that paper that will support that something we published last year that you might have seen, but we will launch and also start early access for that in the second half of this year. Now along with that, we will be submitting for colorectal cancer second half of this year as well as doing early access.

Let me pause for a moment and talk about colorectal cancer. You may say, well, colorectal cancer, is that a low shedding tumor? It's not. It's actually high shedding. And so it's been one of the cancers that many companies have put assays out there for already. However, for us, the play is when we're serving community medicine, we need to have a portfolio of tests, when they're working with Myriad, and we're supporting them that over time, we're able to cover as many of the prevalent cancers as possible.

Furthermore, for your reference, this past weekend at ASCO GI, along with our collaborators from the hospital East, it's part of the MONSTAR study. We shared results from over 160 patients that showed the sensitivity level, a very high degree of sensitivity for colorectal cancer. There is a number of publications now starting to show that, that level of sensitivity could have benefit in being able to detect can't colorectal cancer even earlier and that can make a difference in patient care. Now looking ahead to 2027, now building on the MolDX emissions that we'll have this year, we expect to do a commercial launch of both renal cancer and colorectal cancer broadly. We will also be submitting in 2027 from MolDX for both endometrial cancer and ovarian cancer.

Let me move to some quick updates on prenatal health and mental health. This year, we're looking forward to doing the full commercial launch of first sheet. Now FirstGene is a combined test that brings together NIPT or NIPS testing, carrier screening, both for the mother and the fetus, fetal recessive status, as you can see along with blood compatibility. One of the differentiators for our test FirstGene compared to others that may be available in the market, the fact that our test can be done at 8 week gestational age compared to the most tests on the market being done at 10 weeks.

This is important because 8 weeks is the time when a mother usually comes in to do a battery of other blood tests. So this adds convenience both for the mother as well as for the health care system. Now we have had early access for FirstGene in the market for a number of months now, and the early returns on it are good. Those providers that are using it are happy with the ordering process. They're happy with the results.

On the inside, we have seen very high yield as well in terms of our operational capabilities. The results from this early set of samples that we've been running are part of a CONNECTOR Study, which will also help provide us a path to how we may be able to have reimbursement down the line. And the first set of results from that, we expect to share later on this year. The full commercial launch is set for the second half of this year.

Now along with that, part of the changes we're making going into the year and our commercial organization is to drive absolute focus on the areas to drive the results that we expect to see. So different than what we had been doing before, our sales organization will now have a team that is explicitly focused on prenatal health. So the combination of the launch of FirstGene together with the changes we're making and focus on our sales team, we believe will be a growth catalyst going forward for prenatal health.

Moving to mental health. Now mental health continues to be a very important matter and a growing crisis in this country and beyond. Our GeneSight test is the market-leading product. And now we have provided test results for over 3 million patients. And our test that allows health care providers to select better, the most effective and efficacious drugs that will help individuals who are experiencing anxiety, depression, ADHD and other mental disorders. We started the year with a number of challenges in this area, but I'm very pleased with the progress we've made. More on that when we share our fourth quarter results in a number of weeks.

But I will tell you that going forward, we'll continue to focus on those opportunities, those accounts that we believe have high growth, high reimbursement. We now have 26 states that have biomarker laws that have been passed and our collective teams between sales between legal, between rev cycle and payer markets together are doing a really good job. We have a plan of how to pull through once a biomarker law passes, how we can get reimbursement from that. Now together with that, we've already started to do and see some returns, and we will continue to really leverage the digital capabilities to make it easier to understand what our products is to order it as well as to get support. We are also optimizing a direct payment option.

Now put it together, we expect to grow mid-single digits. We are the leader in this market. That, along with ASPs being stable along with the planned improvements in COGS that we have will make this a profitable business within the next few years.

Let me move now to the financial update. Happy to share our preliminary results. For the fourth quarter, revenue is going to be between $207 million and $209 million. For the full year 2025, we're projecting revenue between $822 million and $824 million. Now in terms of volume for the overall year across all of our products, we had 1% growth. Now just to give you some important elements of the overall volume, Hereditary Cancer had growth of 7% for the year. And as we exited the year, we continued to grow strength in volume and that momentum carried through. Mental Health, again, starting from the place where we had almost no growth in the first quarter. We've done better every quarter and fourth quarter was no different than that.

And Prenatal Health, here, as some of you might be aware, we had a challenge that was based on implementing an order management system, which we've completely resolved now, but it takes some time to get back to the growth level that we want to be at, at or above market. So collectively, for the year, we had a 4% decline in Prenatal Health.

Now as we look forward, as we go into 2026, we're doing a number of things to start accelerating growth, including spending over $35 million over the next few years of particular focus on strengthening our commercial capabilities related to the cancer care continuum. Specifically, we're adding a number of headcount, a meaningful number of head count to our sales teams tied to the launch of our new products. talked about Precise MRD, Prolaris AI and some of the other cancer care products that we're launching. We're also strengthening other tools that are critical to our sales team to make them more effective, make them more efficient along with a very well thought out and funded plan to drive the awareness excitement and demand for our new products as they come to market.

Now in terms of guidance for the full year, let me share the following: revenue of $860 million to $880 million. If you look at the midpoint of that compared to the midpoint, or $823 million that I just mentioned about 2025, that's a 6% growth for revenue. In terms of gross margin, we take pride and put a lot of work into maintaining industry-leading gross margins. The 68% to 69% when that takes into account, that we will continue to have that strength in our core established products, but this includes the launch of new products, including MRD which, at first, we're deliberately going in understanding that there won't be reimbursement.

Now looking at adjusted EBITDA, it's between $37 million and $49 million and at the midpoint compared to our latest guidance on 2025, that's more than a 40% improvement over the year. We spent a lot of time over the last several months looking deeply and analyzing all the way from our existing products, market trends, our specific activities, new product launches, the things that we're doing to improve how we execute to define our long-range plan. And we can share with the conviction that over the next 5 years, starting in 2025 that we will grow our revenue between high single digit to low double digit.

Now we're starting that growth in 2026, improving from what we had in 2025. There are a number of catalysts this year that we're closely tracking. And these are as much about supporting growth in 2026 as they are about indicators, leading indicators of things that will be very important to our growth and acceleration going into '27 and '28. You can see here a number of important product launches. I already talked about disease-specific panels for MyRisk, our core product for Hereditary Cancer. You can see the prostate cancer Prenatal Health with FirstGene.

Along with that, you can see here this is an incredibly important year for us, not for revenue, but for establishing our presence in MRD. And you can see here that there are catalysts both related to submissions and publications that will happen throughout the year. I'll also call out in terms of the overall cancer care continuum, we expect to introduce and share news on one or a small number of important strategic partnerships that will allow us to, again, more comprehensively serve the cancer care opportunity.

Okay. Let me conclude with this slide. This is an energizing time for the new Myriad. We're at an inflection point. We have absolute clarity on our new strategy on the areas of focus, again, cancer care being the most important part of that. Together with that, we have a robust pipeline more robust than we've had in 5 years of new products that we're bringing to market, and that includes not only ones that we've developed internally along with the ones that we're bringing through partnerships to serve high-growth market opportunities. Yes, we are BRCA1, BRCA2, we are hereditary cancer company, but we are more than that, and these products will help solidify our position across cancer care.

Along with that, we're going to leverage the strengths that we build in operational capabilities sample processing, reporting together with the commercial expansion that we have. We're also strengthening our leadership team now, and I believe that we have now an improving combination not just at my CEO staff level, but across many parts of the organization where there's the right combination of domain knowledge and genomics and diagnostics and cancer together with experience.

Now you put that together with this deliberate efforts, programmatically and culturally strengthen execution excellence, roll that all together, we have absolute substance and confidence to grow revenue going forward, high single digit to low double digit. Thank you for listening, and I look forward to your questions.

Can we please invite Ben Wheeler, the CFO, on the stage, please? If you have questions, please raise your hand. Sam, in the meanwhile, maybe I can get the ball rolling with a few questions that do not let me speak.

Please.

Firstly, it's been a couple of years that you joined the company and a month less than a year since you became the CEO. What do you think has changed in the meanwhile?

Yes, there's been a number of changes. I'd offer you the following. We've redefined the focus of the company and the strategy. And we've defined the focus on the cancer care continuum. That's one. We've also had a number of changes in leadership. If you look at the CEO staff, more than half of us are in new positions. So I think we have the right combination of leaders that can take the company forward. We've also started building a new level of rigor and discipline in how we plan and how we exit. You put that together with a robust pipeline. I think these are the most important changes that have happened in the last 12 months.

Okay. And you've put forward a multiyear plan to increase your revenue growth to high single digits or low double digits. What do you think are maybe 2 or 3 pillars that the investors should focus on during this?

Yes. It's tied to the answer to the first one. Again, we believe a very important part of our growth will be the foundational products that and continuing to see performance there. Proprietary cancer continues to be a cornerstone that will continue to do well. Equally importantly, it is about the new products. And this is as much about the promise for the future years and how we're going to accelerate growth. But the effective timely launches of these products will be a very important thing to keep an eye on. And then thirdly, again, doing what we say we're going to do consistently. So every quarter being able to meet the expectations we've set for ourselves, not only in terms of financials, but in terms of the product launches and other important catalysts that I laid out. These are the things that will be important to our success this year.

Okay. Moving on to the cancer care side of things. On the hereditary cancer testing is still a very big piece of the Media story, and we see that from the Q4 as it has been one of the biggest driver of revenue. So with the strong oncology and the unaffected volume growth, where do you think this trend is leading you into 2026 at that we see in testing?

Hereditary cancer, again, as I said, it's a $7 billion market opportunity. The $5 billion part of the market is less than 20% penetrated. We believe the combination of the new product, the updated MyRisk panel that we launched in Q4, the new disease-specific panels that we will be launching coming up in the next half that I talked about, along with, by the way, NCCN guidelines continue to expand where hereditary cancer can be used. And the other market activating things that I talked about, we did. This gives us a dance to grow this continued growing in a very healthy way and delivering a significant amount of profit which is important for hereditary cancer in patients, but it's also a very important way for us to fund our intentions as we expand in cancer care.

And on Prolaris, can you throw some light on the AI enabled version of Prolaris? How does it change things from Myriad? And how does Myriad win back the share?

Yes, great question. Listen, the fact is that over the last couple of years, we've been just holding steady. And that means that we have been losing share. We are very excited, and we're really energized to see the market reception even with the announcement that we would be bringing an AI-based test to market. That, together with the KOL engagement that we've had the expansion that we've already put in place, and we'll be continuing to do on the Prolaris or the urology sales team, I think, gives us an opportunity to return to growth for our prostate cancer, arisen test in 2026. And then again, I said this is our first AI-enabled launch, they'll be more in the coming years. So now this is the opportunity to accelerate growth in prostate cancer.

So, are there any questions in the room? Okay. I have a few more questions, if I can pick your brain, please. On MRD, you mentioned that we'll be having a controlled launch the reimbursements. So what does success in 2026 look like for MRD?

Yes, there's a number of things. This was such an important year for us in MRD. It is first market related to this is starting clinical testing for a select number of customers. It is the submission for MolDx for a number of tests that I mentioned, breast, colorectal, renal. And it also means for those in a controlled way, the customers that we're doing testing for that we are closely working with them to understand their experience, understanding their ordering patterns and see what's the level of repeating testing. These are important for MRD success this year.

Okay. Great. And you mentioned about the collaboration with SOPHiA Genetics or MSK? How would you define success in this collaboration?

Yes. So again, where we're starting off with the collaboration is really focused to be able to serve pharma partners in the biomarker selection, development and CDx development registration. So signing up one or multiple agreements to start leveraging this, we're in various conversations already, but actually initiating that work will be an important milestone and measure of success for that partnership.

And could we perhaps be seeing more partnerships or collaborations in 2026 or even near term?

Yes. Yes, as I mentioned, and in fact, that's a catalyst. Now listen, it's less about an extensive number of partnerships. It is more about strategic partnerships that we really think can have deep impact. So yes, we would expect to announce one or a small number of other strategic partnerships throughout the course of this year.

Okay. And you mentioned a number of new product launches that the team is planning in 2026. I'm sure these come along with a reasonable number of expenses or the resources that are required to make these expenses. So should an investor expect expenses to jump near term of launches?

Well, I'll start, and Ben, you can always jump in here, too, please. The short answer is this is all contemplated within our plan for 2026. Yes, we will be doing the things, as I mentioned, to drive awareness, understanding and demand for our products, working with KOLs and other things to really activate. But the funding for that in part is paid for, if you will, by some strategic moves we made restructuring and other cost management things that we did in October of last year. And the other spend is part of our plan. So in terms of a bolus of spend, I believe that was the question. That is not something that an investor should expect.

Yes. I think the only thing that I would add is Sam spoke to the $35 million multiyear investment that is contemplated to those new product introductions are contemplated in that multiyear investment. And again, just to reiterate that, that investment is contemplated in the guide. So we would expect a modest increase in OpEx year-over-year, again, contemplated in the 2026 guide.

Okay. And what would you say are the top 3 priority catalysts out of the number of things that we are looking out for in 2026?

Yes. First, I would give you the category called MRD. So we've already talked about that. There's a lot of sub catalysts in there, again, starting the testing, getting the MolDX submissions and so forth. Next, I think Prolaris with AI is the important catalyst. Again, that is one of our -- it's a very profitable test for us. It's an important market. And beyond the volume directly for prostate cancer testing, it also has the opportunity to pull through my risk and other tests. And third, I would say it is really about the announcement and being able to initiate a strategic partnership that allows us to further tap into serving the cancer care continuum.

And talking about these new launches, how much of your 2026 revenue that we are guiding do you expect to be arriving from the new launch products versus the existing products?

Ben, do you want to take this one?

Absolutely. So yes, we're excited about 2026 for lots of reasons. Sam's spoken to all of those. The guide, however, is centered on our core products. And so the revenue guide of $860 million to $880 million is focused on our core portfolio. There's an immaterial implication or impact considered from new product introductions in that guide.

Okay. And with your long-term goal, like we have discussed already, what do you think are the key levers that support this growth acceleration? And how do you think ASP plays a trend in those factors?

Yes. So when we think about the long-range plan and the acceleration of Again, Sam spoke very well to the focus on the cancer care continuum. We need to build on our leadership position in hereditary cancer and HRD. We need to expand into offerings in MRD and in CGP. And then when we think about how ASP plays into that, our view regarding ASP as it relates to the hereditary cancer franchise is that there's going to be modest pressure downwards looking forward down 1% to 2% downward. And then Sam spoke to this as well when we think about prenatal and mental health, we expect some stability in ASP there when we look forward across the LRP period.

Okay. And probably one last question in the interest of time. We also spoke about investing to set up the growth inflection coming up in 2027. What do you think are the biggest swing factors in achieving both revenue and margin?

Do you want to start?

Sure. Happy to. Yes. So again, as Sam mentioned, we took some reorganization efforts in Q3 in order to be able to reallocate $35 million in order to accelerate growth. I think that's key in order to enable that acceleration in '26 to set us up in '27 and beyond.

Yes, well answered. I mean the other 2 factors is, listen, we're being very deliberate in a controlled way to increase funding for commercial capabilities. And that will have an impact in the second half of the year and going into next year. And of course, again, it's the new portfolio of products, the pipeline that will set us for not just a good year, but really for 2027.

Perfect. That brings us to the end of the presentation and the Q&A. Thank you, team.

Thank you.

Thank you.

Good day, and thank you for standing by. Welcome to the Myriad Genetics' Third Quarter 2025 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your first speaker today, Matt Scalo. Please go ahead.

Good afternoon, and welcome to the Myriad Genetics Third Quarter 2025 Earnings Call. During the call, we will review the financial results we released today. And afterwards, we will host a Q&A session. Our quarterly earnings release was issued this afternoon on Form 8-K and can be found on our website at investor.myriad.com.

I'm Matt Scalo, Senior Vice President of Investor Relations. On the call with me today are Sam Raha, our President and Chief Executive Officer; Ben Wheeler, our Chief Financial Officer; and Mark Verratti, our Chief Operating Officer. This call can be heard live via webcast at investor.myriad.com, and a recording will be archived in our Investors section of our website, along with this slide presentation.

Please note that some of the information presented today contains projections or other forward-looking statements regarding future events or the future financial performance of the company. These statements are based on management's current expectations, and the actual events or results may differ materially and adversely from these expectations for a variety of reasons. We refer you to the documents the company files from time to time with the Securities and Exchange Commission, specifically the company's annual report on Form 10-K, its quarterly reports on Form 10-Q and its current reports on Form 8-K. These documents identify important risk factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements.

I will now turn the call over to Sam.

Thanks, Matt. Good afternoon, everyone, and thank you for joining us today. I'm pleased with our results, the actions we're taking to execute against our updated strategy, the stepped-up urgency and rigor in how we operate, leading to growing momentum as we head into Q4 and 2026.

Let me start with our results. We generated revenue of $206 million, which decreased 4% year-over-year. When you exclude previously discussed headwinds, including UnitedHealthcare's decision on GeneSight and the divested European EndoPredict business, our business was stable with Q3 of 2024. In addition, there was a material $8.6 million prior period contribution in the third quarter of 2024 that did not repeat. Factoring in these previously discussed headwinds in the prior period change of estimates, year-over-year growth was 5%. In terms of testing volume, our solid results were supported by continued strong volume growth for MyRisk in oncology at 16% over the year ago quarter. We also saw volume growth for MyRisk for unaffected at 11%. This is a meaningful improvement from past quarters and reflects our ongoing efforts to enhance the customer workflow, including EMR functionality. Mark will provide additional color in his section, but certainly, MyRisk continues to see positive demand in the market and supports our profitable growth journey.

GeneSight volume grew 8% year-over-year, accelerating from the first half of the 2025, as our commercial organization continued to focus on medium and higher volume accounts. Prolaris demand continues to be stable, and test volume growth up modestly year-over-year. As expected, volume growth for our legacy prenatal products, Prequel and Foresight, while flat year-over-year, showed improvement from second quarter, as we continue to increase the volume of testing customers affected in Q2 challenges and add new customers.

Turning now to profitability. We generated strong adjusted gross margin of 70.1% in the third quarter and closely manage our discretionary spend as reflected in our adjusted OpEx line. Ultimately, we reported a healthy adjusted EBITDA of $10.3 million. I'll talk about our growth strategy in a moment, and Ben will talk later about our reiteration of the 2025 financial guidance.

Moving to the next slide. I want to spend a few minutes reviewing our updated strategy and why we believe we will be able to deliver accelerated profitable growth in the years to come. Our first strategic pillar is to focus on the cancer care continuum to accelerate growth. We will achieve this by leveraging and growing volume of our leading hereditary cancer test, MyRisk, and also by expanding our portfolio to include other cancer screening, diagnostic and monitoring tests.

Our second strategic pillar reflects our recognition of the opportunity to meaningfully grow prenatal health and mental health revenues at or above market growth. We believe, we can achieve this by leveraging recently launched products and strengthening our commercial execution, while maintaining a disciplined level of investment and resources in these areas. Our third strategic pillar is about our focus and commitment to delivering sustained profitable growth by continuing to leverage our industry-leading gross margin profile and maintaining financial discipline.

Now one can say, what's different about this strategy from before? Well, there are 5 primary differences. First, it's about intentional focus and prioritization of funding and resources on the cancer care continuum opportunity. Second, for our cancer care portfolio, it's about going beyond our strong hereditary cancer and HRD positions and also offering tests for other relevant high-growth applications, including therapy selection and MRD. Third, it's about strategic partnerships. Unlike before, we see an increasing opportunity to serve attractive market applications in a timely manner by complementing Myriad's differentiated capabilities by leveraging select partnerships.

Next, it's about having the right team with deep domain knowledge and proven experience in cancer, diagnostics, genomics and commercial execution to win in a dynamic market. And with the leaders that have joined Myriad like Lou Welebob for Biopharma and CDx Services, Hosein Kouros-Mehr for Oncology R&D, Vishal Sikri for Product, and Brian Donnelly as our Chief Commercial Officer, I'm confident in the strength of our overall team. Finally, it's about strengthening execution excellence, thinking and acting with elevated urgency, leveraging industry best practices for key processes and executing with rigor and discipline.

On the next slide, let me provide updates on the progress we're making on the cancer care continuum strategy, many of which will be important catalysts for accelerating growth in 2026 and beyond. We're on track to launch our updated MyRisk test this month in November, and we expect this to support strong MyRisk growth in 2026 and beyond. In terms of offerings for other attractive high-growth cancer care applications, in September, we entered into a collaboration with SOPHiA GENETICS that enables us to provide pharma customers with biomarker validation and CDx development services using a leading liquid biopsy-based therapy selection assay.

We're making steady progress on our ultrasensitive tumor-informed Precise MRD test and are on track to start offering the test for clinical use in the first half of 2026. First indication will be Stage II, Stage III breast cancer in the neoadjuvant setting. In addition, Myriad will present three MRD studies at the San Antonio Breast Cancer Symposium next month, two of which were just accepted this past week as late-breaking abstracts.

We'll also be presenting six additional abstracts and other oncology-related studies for a total of nine abstracts at SABCS. We're also on track to launch our first Prolaris prostate cancer test that combines the power of molecular and AI, based on our partnership with PATHOMIQ in the first half of 2026. I expect to have more exciting news regarding strategic partnerships to share with you over the coming months. Also, I want to take a moment to share that we are making changes in our organizational design and investments to help improve customer experience, gain market share, and reduce operating expenses as a percentage of revenue going forward.

The actions we are taking will in part result in the reallocation of headcount and funding to support growth in the cancer care continuum. This will include the meaningful expansion of our commercial team and increased funding for commercial launch and market activation programs to support the exciting new products that I just updated you on as well as increased funding for MRD R&D.

On the next slide, let me provide brief updates on our second and third strategic pillars. In June, we commenced early access for our FirstGene multiple prenatal screen that we believe will support growth in our prenatal portfolio volume profitability and has significant potential to expand the prenatal market over time. Mark will provide more details on our experience during our early access and how this supports our optimism for strong commercial launch in 2026. Regarding mental health, we expect to continue growing revenue for our market-leading GeneSight test by concentrating high-value accounts, leveraging state biomarker laws, and building on the success, we've seen over the past few quarters.

In alignment with our overall strategy, we will achieve this growth for both of these businesses while maintaining disciplined capital deployment. The third strategic pillar is about our focus and commitment to delivering sustained profitable growth. The organizational redesign and efficiency actions that I shared with you earlier will support our ability to accelerate top line growth while ensuring we grow operating expenses less than revenue. Before I turn the call over to Mark, I want to welcome our new CFO, Ben Wheeler. Ben certainly isn't new to many of you. And with 14 years of experience at Myriad, he has the knowledge, skills, and demeanor that make him our ideal CFO. Personally, I'm thrilled to partner with Ben in this important time for the company.

Now let me hand it over to our COO, Mark Verratti. Mark?

Thanks, Sam. Turning to oncology. In the third quarter, total oncology revenue was $81.8 million, a decline of 1% over the third quarter of 2024. I would call out that our MyRisk test continues to gain share with volume growth in the affected market of 16% and 11% volume growth in the unaffected market in the third quarter year-over-year.

Shifting to prostate cancer. Prolaris revenue in the third quarter grew 3% year-over-year on positive volume growth and a continued improvement year-to-date. As mentioned on previous calls, we are investing in the commercial channel and other programs to grow and regain share in this market. As an example, Myriad is on track to be the only company that will offer AI, biomarker, germline and tumor profiling testing when we launch our first AI-enabled Prolaris test in the first half of 2026.

I'm also excited to call out a strategic collaboration we recently announced with SOPHiA GENETICS. We expect this collaboration to support the development and global commercialization of comprehensive companion diagnostic solutions for our biopharma partners with the potential to add an important product offering to the Myriad menu and support the growth of our companion diagnostic programs. We look forward to providing an update on our progress going forward.

Lastly, I want to call attention to our September press release regarding our latest MRD publication in Lancet Oncology. Our tumor-informed ultrasensitive Precise MRD test showed clinical value in patients with oligometastatic clear cell renal cell carcinoma, which is a very low-shedding tumor and requires an MRD test in the ultrasensitive range.

Importantly, the study showed that in patients who were Precise MRD negative and maintained on metastasis-directed therapy, and not on systemic therapy, had an overall survival rates of 94% at 2 years and 87% at 3 years. The data is extremely promising because it highlights that using an ultrasensitive test like Precise MRD can potentially identify specific patients on MDT, who can delay systemic therapy and all of its associated side effects based off of their ctDNA status without sacrificing overall survival rates. As Sam mentioned, we are excited and expect to start offering our ultrasensitive Precise MRD test for clinical use in the first half of 2026.

Expanding on MyRisk. With our current momentum in the hereditary cancer testing, now is a perfect time to launch Myriad's expanded MyRisk with RiskScore panel. The team is excited to get this new test in the hands of our customers and drive further growth and build on our leadership in the $6 billion market. This new panel adds 15 actionable gene targets and is the only panel to meet both NCCN high-risk assessment and ASCO strongly recommended guidelines. I can't overemphasize that point enough as guidelines impact provider decisions.

In fact, many of our medical oncologists and genetic counselors, those that work with pan-cancer test populations, have been very interested in our expanded panel in order to not miss any patient who may have a hereditary cancer syndrome that may impact treatment.

Now moving to our women's health business. In the third quarter, Women's Health delivered revenue of $85.2 million, an increase of 3% over prior year period. We're pleased to see incremental positive momentum in hereditary cancer testing in the unaffected market with revenue growth of 4% and volume growth of 11% year-over-year. This improving volume growth trend is particularly important as it reflects EMR-related workflow improvements put in place earlier in the year. And in September, we've completed the integration of our myGeneHistory assessment into EPIC as a way to better identify patients that qualifies for hereditary cancer testing and improve the provider experience, so we are optimistic about the potential for continued momentum. We also remain confident about the ongoing progress from breast cancer risk assessment programs that enable providers to rapidly identify patients who qualify for additional screening.

We continue to see positive momentum at these sites and expect to make further investments in our commercial capabilities to accelerate this program through Q4 and into 2026 to fuel growth in MyRisk volume. As for prenatal testing, in the third quarter, we saw a modest rebound in volume growth from the second quarter and expect this trend to continue. As Sam mentioned, we introduced our multiple prenatal screening test, FirstGene and expect the commercial launch in 2026. This test provides added insights to providers and has the potential to expand the overall addressable prenatal testing market. We are pleased with our turnaround times, assay performance and early customer feedback.

Now turning to mental health. In the second quarter, the team generated GeneSight revenues of $38.7 million on volume growth of 8% year-over-year. We continue to drive expansion of the ordering provider base by achieving a record number of ordering clinicians over 37,000 in the third quarter.

While quarterly revenue continues to be impacted by UnitedHealthcare's coverage policy change in January, we submitted additional data in Q3 and expect to review this quarter as part of their typical review cycle. While we continue to work with United to achieve a successful outcome for both parties, we continue to make forward-looking decisions assuming the status quo.

We are excited and proud of our payer markets team for securing positive coverage policies across 9 states for GeneSight year-to-date related to biomarker laws. Most recently, the California Medicaid program, Medi-Cal, added GeneSight with a September 2025 effective date. In addition, we are seeing benefit from optimizing revenue cycle workflows to maximize reimbursement.

I will now turn the call over to our new CFO, Ben Wheeler.

Thanks, Mark. I'm especially pleased to join you today as Myriad's Chief Financial Officer. Myriad is a company whose mission I've been fully committed to for the last 14 years, and it's an honor to now represent our team in this role. While this is my first earnings call as CFO, I've had the opportunity to contribute to many of them over the years. Let me start with a recap of our third quarter consolidated financial results.

For the third quarter, we reported revenue of $205.7 million, a decline of 4% year-over-year with test volumes up 3%, but average revenue per test down 7%. The growth in third quarter test volume reflects improved execution across our portfolio. As Mark pointed out, the hereditary cancer testing portfolio saw strong volume growth in the third quarter, increasing 11% year-over-year.

Our mental health business saw volume growth of 8% year-over-year as the team continues to hit its stride following organizational adjustments made earlier in the year. The reacceleration in both unaffected hereditary cancer volumes and GeneSight volumes represent important proof points in our improving commercial execution.

The year-over-year headwind in average revenue per test this quarter primarily reflects three factors, two of which we've discussed previously. First, we're lapping a difficult comparison against third quarter of 2024, which included an $8.6 million positive prior period change in estimate versus an immaterial amount this quarter. Second, we continue to see the impact from UnitedHealthcare's policy change with respect to GeneSight coverage, which took effect in January 2025.

The third factor reflects modest shifts in payer mix within our hereditary cancer portfolio that had a larger-than-expected impact on average revenue per test in the third quarter. As you know, payer mix can be quite fluid, and it's something we actively work to manage through our commercial targeting and revenue cycle and payer markets teams. Our fourth quarter assumptions for average revenue per test take these third quarter dynamics into account. This quarter, these 3 factors have masked our strong ongoing work by our revenue cycle, payer markets and clinical development teams as well as the generally stable reimbursement landscape. As we mentioned last quarter, we're encouraged by the progressive stance some payers are taking towards ECS coverage, even in the absence of updated ACOG guidelines, and the ongoing traction we're experiencing with health plans that have implemented medical policies that conform to state biomarker legislation. We expect these positive trends to continue supporting prenatal and GeneSight reimbursement in the quarters ahead.

My last comment on third quarter revenue. Sam referenced an underlying third quarter 2025 revenue growth rate of 5% after taking into account the impact of certain items on our Q3 2024 baseline, namely UnitedHealthcare's net impact on GeneSight of $7 million, the divestiture of our EndoPredict European business of approximately $1 million and the $8.6 million impact from prior period change in estimate in the third quarter of 2024 that did not repeat this quarter.

By calling out these items, we're able to show what we consider to be a clear view as to Myriad's underlying performance trends. Even with these headwinds to third quarter revenue growth, we maintained adjusted gross margins of approximately 70%. This reflects a favorable test mix, continued operational efficiencies in our labs and underscores the strength and scalability of our business model. Third quarter adjusted operating expenses decreased by $1 million year-over-year, reflecting continued cost discipline across SG&A. We remain focused on maintaining the right balance between investing for future growth and driving profitability with a deliberate effort to allocate resources to our highest strategic priorities.

Next, I'll speak to Myriad's profitability and liquidity. We generated $10.3 million of adjusted EBITDA and $18.6 million in adjusted free cash flow in the third quarter. Our strong adjusted free cash flow in the third quarter reflects the timing of collections from certain payers, as we noted on our second quarter call, and we don't expect this level of free cash flow generation to repeat in the fourth quarter. That said, the combination of our strong gross profit base and positive adjusted EBITDA demonstrates the leverage inherent in our operating structure and the profit and cash-generating potential of the business.

Lastly, we have a solid balance sheet and access to $220 million in capital. Next, I'll talk about additional steps we are taking to drive business results. As part of our strategy to drive sustained profitable growth, we have launched a multiyear program to invest more than $35 million in strengthening our commercial capabilities with a focus on the cancer care continuum. This investment will be primarily funded through the company's streamlined structure, continued emphasis on organizational efficiency and disciplined capital deployment. Three core areas of future investment include: one, the expansion of our commercial organization, this includes meaningful growth in our field sales team and optimizing the structure and management of target territories; two, the enhancement of commercial capabilities and tools to support new product introductions and commercial excellence; and three, increased funding for strategic R&D programs, which includes current and future clinical studies for MRD as well as other areas.

Part of our organizational redesign is to move to being organized functionally going forward. With this, we're reducing management layers and eliminating other roles. We believe these important actions will accelerate revenue growth and generate long-term value.

Before I conclude, I'll cover our full year 2025 financial guidance. Based on our Q3 performance and our expectations for the remainder of 2025, we're reaffirming our full year financial guidance, which includes a revenue range of $818 million to $828 million, a gross margin range of between 69.5% and 70%, and adjusted OpEx range of between $562 million and $568 million as well as an adjusted EBITDA and adjusted EPS guidance ranges of between $27 million and $33 million and a loss of $0.02 and a gain of $0.02 for the full year 2025, respectively.

Now let me turn the call back to Sam.

Thanks, Ben. Considering breast cancer awareness month in October that just passed, I want to take a moment to reiterate Myriad's long-standing commitment to supporting patients and health care providers with breast cancer risk assessment and medical management tools. We will continue investing in tests that help improve breast cancer care. As we noted earlier, our MyRisk with RiskScore test is considered an industry gold standard, and we're looking forward to launching the expanded panel later this month. And then in the first half of 2026 to launching our first Precise MRD test for breast cancer.

As for the third quarter, we demonstrated good progress across our commercial operations and development teams. Strong volume growth for a number of our tests supported this quarter's performance, while our overall gross margin remained resilient and among the industry's best. This, combined with our ongoing focus on operational leverage, allowed Myriad to drive another quarter of positive adjusted EBITDA while investing for future growth. With clear actions now being implemented to support the execution of our updated growth strategy, the Myriad team is energized to deliver on our mission to advance the health and well-being for all, positively impacting an increasing number of patients while driving accelerated profitable growth.

I'll now pass the call over to Matt for Q&A. Matt?

Thanks, Sam. And as a reminder, during today's call, we used certain non-GAAP financial measures. A reconciliation of the GAAP to non-GAAP financial results and a reconciliation of the GAAP to non-GAAP financial guidance can be found in our earnings release and under the Investor Relations section of our website.

Now we're ready to begin our Q&A session. [Operator Instructions] Operator, we're now ready for the Q&A portion of the call.

[Operator Instructions] And our first question will be coming from Puneet Souda of Leerink Partners.

Maybe, Sam, a higher-level question here. With the commercial focus and the investment you're talking about, can you talk a little bit about what are some of the offsets and the savings that you're able to manage as you go into 2026? How should we think about growth as a result of these investments? And obviously, profitability has been, as you pointed out, an important piece of the story. So how should we think about adjusted EBITDA in 2026, just given the focus in pushing for growth? I just want to understand a little bit in terms of the growth versus profitability focus that you have emerging on this call.

Yes, Puneet, thank you very much for the question. And let me start and then Ben, I'll turn to you to add more color. So first, let me reaffirm embedded in your question, we are committed to profitable growth going forward and being able to accelerate that, as you know, we've talked about, by focusing in on the cancer care continuum.

So the actions that we took related to the organizational redesign and changes in our investment focus, those actions, including, and Ben spoke to this already, reorganizing in a way where we believe we're going to be able to serve customers, be able to increase our win rate. This includes, in some instances where we've taken out multiple layers of management, we've made other choices on positions that we've deemed to be less critical than other ones that are related to having more feet on the street, if you will, to compete, and particularly timed with new upcoming product launches that we have that you heard me talk about. So between that and reallocation of investments, we are committed to growing revenue faster than we grow operating expenses. So that part of the profitability along with growth remains intact. I said a lot there, Ben. What would you add?

Yes. I would just say that the actions and the focus is absolutely consistent with the strategy as we focus on the cancer care continuum, and we want to grow revenue at an accelerated rate, and we want to do it profitably. We felt like we could rebalance the organization and focus on growth in the cancer care continuum by expanding the sales footprint and focusing on tools and also R&D to support that, and we believe that we can do that.

Okay. And then a question on the NIPT side. Just wanted to get a sense of -- it does look like you came in softer versus us and consensus as well, just wondering if there was any share shift that you're seeing in the market. I know you talked about that you grew sequentially, but -- just wondering, given new entrants in the marketplace, mother-only blood draws with a competitor, others that are pushing it more aggressively into market, maybe just help us understand what you're seeing on the market end versus Myriad's position, and if you're seeing any share loss?

Yes. So, Puneet, thank you for this question, too. And you might recall, we had some challenges that were related to our operational execution matters that were in Q2, which we've fully addressed. And we had predicted that it would take us multiple quarters to gain back to the level of growth that we'd expect, right, to be able to grow at or above market, which means at least in the single digit for volume, if not higher, because we do have the new products, which we've seen good traction from, be it Prequel at 8-week gestational age, Foresight with the expanded carrier screening. And most recently, we've also added F8 and FXN.

So we're actually -- we have seen improvement where we actually decreased in volume, I think, 7 percentage points last quarter, and we talked about volume being flat. Now are we happy with flat? Heck no. We want to gain -- go back to being able to grow at or above market, but we're pacing actually exactly as we had anticipated and we had kind of shared with you.

Now are there others that are growing and that are coming to market? Yes, that's a fact. I'm not commenting on that, but we are, by the way, excited about the opportunity to accelerate our own growth with FirstGene, which Mark talked about in his comments, which will be the combined 2-in-1 screen for NIPS together with carrier screening.

And our next question will be coming from David Westenberg of Piper Sandler.

I'm going to actually follow on Puneet's question on NIPT business. Can you give us some color on the friction on the new ordering management system, why that is lasting into this quarter and why that wouldn't maybe necessarily end in the second quarter? And then just in terms of that market dynamics that he kind of discussed here, can you talk about how single-gene NIPT would play a role in kind of maybe some of the growth that you'd receive next -- or see next year? Do you expect any data differences, particularly after you complete the CONNECTOR study? And maybe can talk about some of those long-term differences you might see versus some of those long -- versus some of those competitors? And I'll have one quick NIPT follow-up.

Yes. Thank you, Dave. Appreciate the question. Let me start, and then I'll invite Mark in answering with me here. Again, we wish we can just snap our fingers and gain back all the customers in the volume. I think we had described this previously. The matter is that many of the high-volume customers that we have, they are working with a -- us and a couple of other often -- other providers for these prenatal tests. And when we work through our -- when we have the challenges, which again, have been completely addressed, that led to some shifts in volume away from us. So we are improving on that. That's why we've gone again from 7% volume decline back to flat in terms of our volume. Again, that's not where we want to be.

We're right on track to being able to now show volume growth in the coming quarters. It just takes time to regain and also to add new customers, and we have done that. It's just -- it's something that you just can't make happen much quicker than that. Second part of your question is related to FirstGene, again, our screen that combines NITS together with expanded carrier screening. And we are excited about that, Mark. Maybe you can talk a little bit about both what we've seen so far as well as why we think it's going to help us expand the market.

Yes, sure. Thanks, Sam. Look, I think we knew when we started developing FirstGene that there were a couple of challenges within the carrier screening space. Number one is providers just didn't have enough time to really talk about all of the benefits, and there was a little bit of complexity in terms of ordering the products. Number two, we knew that only 30% of the time, fathers were also getting screened. And so we knew that there would be an advantage of having a single test where you only need to test the mother and then have the ability to look at the fetal recessive status.

So since then, obviously, some competitors have entered the space, and they've had success. So if anything, that's just validated, what we already knew and has given us some greater conviction around the product that we're going to be bringing to market, we know that our product is going to be competitive from a scientific clinical perspective. Based on the footprint that we currently have, we're excited to be able to bring it to our providers. And so we think we will have a very, very competitive test that will have lower gross margins moving forward than our current product. So we are excited to be launching that next year.

And Dave, you had asked a part of that. Yes, we believe this will help expand the market, the market opportunity for us and accelerate our growth, not relative to the 0% volume growth, but relative to being at or above market. So beyond what we really were previously, we should be getting back, it's growing faster than that.

Got it. I just want to maybe ask one more on just kind of the revenue opportunity growth from an ASP perspective in the coming years. Do you think that there's -- or can you remind us if you're getting paid for RDH (sic) [ RHD ]? When do you think you could get that -- see that happen? Any update on ACOG, microdeletions or expanded carrier screening? And then lastly, on that single-gene NIPT offering, as I understand, you would be not, no longer receiving the father -- or no longer running a father sample. Is there a chance to go back to reimbursement in the future for an additional reimbursement for that given the fact that you are saving the system money by not getting the father or testing the father?

Yes. Thank you, Dave. I think you had quite a number of important questions built into. First, let me just provide some facts on that. what we provide today does not have RHD. So we're excited that when we actually launch this product that RHD will be included in our FirstGene offering. In terms of ACOG, we remain intrigued and interested and fully ready to catch the wave when ACOG guidelines are introduced. Important point related to ASP there, we have seen a number of payers in advance of that starting to see the value of the fuller expanded carrier screening and starting to reimburse for that. So that's good news. We expect that to continue as it is. Mark, do you want to speak to maybe the third question is related to opportunity father reimbursement related.

Yes. Look, I think, we will -- as we continue to generate clinical evidence, and as you know, some payers will require us to get a very specific code for our FirstGene products, I think we are excited to have those conversations, but if you think about the time that it took to get expanded carrier screening, we're not necessarily going to rely on anything happening quickly within the reimbursement market. But for sure, any time, innovation comes out, if we can get it quickly adopted into guidelines, we'll be sure to be talking to payers about trying to get increased reimbursement because you are right, it is a win-win for both patients as well as those that are reimbursing it.

Our next question will be coming from Dan Brennan of TD Cowen.

This is Kyle on for Dan. I wanted to shift over to the hereditary cancer side of the business. Volume grew 11% year-over-year off a pretty strong number Q3 last year. Just digging in a little bit, with any of the 3Q volume growth, sort of, any catch-up from the EMR issues you experienced in the last few quarters? And then maybe on that, I know some peers have really put up some pretty strong numbers in the hereditary cancer testing side. Is there anything going on in the market that's really accelerated over the last 11 months?

Thank you for the question, Kyle. Yes, and we are pleased with the performance we had for our overall hereditary cancer portfolio, particularly for MyRisk, which will play an even bigger role going forward, as you heard us talk about with the launch of the updated expanded panel that we have later this month. I think you also asked, like is there anything specific going on? Is there a catch-up? I don't think so. The testing that has to happen as it relates to the oncology patient that happens in a very timely manner, we've continued to be strong there.

What we have done, as you heard Mark talk about in his section, is we have continued to make improvements to the workflow for the actual customers. Some of the challenges that we weren't as easy to work with, we've improved on. We've had some improvements on the EMRs, the EMR part of the ordering and reporting journey. So those things, I think, have -- are starting to show fruit along with what Brian and his team have been doing have really been starting to drive. And I think we're still early days of our programs like the breast cancer risk assessment program and other things to really help those in the unaffected providers and health care systems better identify and bring patients forward. And I think that there's a lot more to come there.

And the overall market, again, as a reminder, that market is closer to $5 billion, less than 50% penetrated, and it's a great market development opportunity for us and perhaps other competitors in the space. So I don't know, Mark, if you or Brian have anything to add about anything in the market, but what it does reaffirm for us, our results, and maybe the broader dynamics is a great foundation for Myriad with our gold standard tests to continue really growing profitably in '26 and beyond.

Got it. And then maybe on the partnership side, you announced the PATHOMIQ partnership earlier this year, you just announced the SOPHiA partnership. Where in the portfolio might you be looking to add more of these partnerships in the near term?

Yes, great question. Our primary focus is, first and foremost, related to the cancer care continuum. And we are excited, by the way, by both of those partnerships. And for the Prolaris partnership with PATHOMIQ, as I said, it's -- and now that Brian is here, we're also -- him and his team are working in partnership with Mark and others to think about excellence in commercial launch, and that's why we're thinking about exactly how to sequence that into the first half of the year.

In terms of next, where to look, what I would tell you is we are particularly interested in partnerships that allow us to expand into these high-growth attractive market segments of the cancer care continuum. SOPHiA is a great example of that. We knew that we needed an offering starting with -- for pharma partners in liquid biopsy for therapy selection using a comprehensive genomic panel.

We're starting by leveraging the work that both SOPHiA have done in partnership with MSK. MSK-ACCESS is their liquid biopsy assay. So we're excited to start there with the option to provide that liquid biopsy assay down the line for clinical use for clinical testing. And if you think about the other exciting areas, important high-growth areas, that include other elements of therapy selection. It includes areas such as IO therapy response monitoring, other things we might be able to do to go even faster in MRD.

Now, I'm not saying we're going to do all these, but these are illustrations of some of the things that we're deeply thinking about that we think would add value to the customers that we serve with a more comprehensive portfolio, but help us, also in a profitable way, accelerate growth.

And our next question will be coming from Lauren Timmins of Jefferies.

This is Lauren on for Tycho. Just to kind of level set the volume growth and top line performance for HTT, in particular, revenue was down still 4% year-over-year, even though you had 11% volume growth. So maybe just kind of what were some of the biggest mix and ASP effects and how that is going to evolve, especially with the cancer tests targeted November 2025 launch? And then the second kind of follow-up question there in terms of the cancer care continuum. What are some of the specific, I guess, KPIs, whether that's integration pathways with oncology networks, EMR-triggered orders that you're going to be looking for, for targets for 2026?

Thank you, Lauren. Appreciate the question. Why don't we start with you, Ben, to help with the first part, and then you can start with the second question? Mark, you can help with that one, too.

Sure. Yes. Thanks for the question. So we touched on the primary drivers that resulted in 4% decrease in revenue year-over-year. ASP was the driver of that. And the biggest pieces of that change year-over-year, naturally, we're still feeling the impacts of the medical policy change from UnitedHealthcare as it relates to GeneSight. Sam also referenced the $1 million impact for the divestiture of our EndoPredict business. So the combination of those 2 things were an $8 million headwind in the quarter year-over-year, and that resulted in flat revenue when we compare this year's Q3 relative to last year's Q3.

And then Sam also referenced the change in estimate to revenue that benefited last year's Q3 of nearly $9 million that did not recur this year. So the combination of those 2 headwinds, when you adjust for those, we're looking at about 5% revenue growth year-over-year. And then in my prepared remarks, I talked about a couple of additional items that impacted ASP during the quarter. So as it relates to the enterprise, we had product mix that impacted our ASP, and then when we think about hereditary cancer specifically, we had some payer mix that impacted ASP.

So we've been really pleased with the progress that we have made with our biopharma business, really strong ASPs in connection with that revenue, but that revenue is also lumpy. And because it is lumpy, we had some adverse effect to our hereditary cancer ASP as a result of the lumpiness of that biopharma hereditary cancer revenue in the quarter. And then we also had some impact to ASP for hereditary cancer as it relates to some out-of-period revenue, although it was not material to the organization during the quarter, it did have a little bit of an impact on ASP for hereditary cancer.

Mark, do you want to take a little bit of the first question?

Yes, Lauren, related to the KPIs, and we'll provide more of this as we get into 2026, probably at JPMorgan sort of beyond. But I think in addition to the standard KPIs, when you think of volume as well as revenue, I think as we think about the cancer care continuum, we'll be looking a little bit more into the providers that are actually ordering our test and thinking about how are we expanding that provider base as well as providers that are using multiple of our products.

So we have several of our top customers today that we've heard from who want to just use a single lab like Myriad. And so I think our ability to be able to sell into that channel for both hereditary cancer, HRD, MRD, and our full continuum will be something that we'll be sharing in the future, but that's just a glimpse, but we'll share more at JPMorgan.

And our next question will be coming from Subu Nambi of Guggenheim.

This is Ricki on for Subu. I wanted to ask another on women's health. I know a lot has already been asked, but you're quite differentiated in offering Prequel at 8 weeks. That's a week earlier than the blood draw for most of your competitors. And that time line advantage, though, is only really clinically meaningful if the patient and the physician are receiving their results sooner than the competing tests that are offered for a 9-week blood draw.

So if your results take a 2-week turnaround, then the competitor takes a week after drawing the sample at 9 weeks, both of you are delivering results in the 10th week of gestation. So with that context, what is your current average turnaround time for your Prequel results today?

Yes. I mean, I'll let Mark take this in more detail, but I believe our turnaround times for almost all of our products are industry standard or industry best. So there's not like an extended period. Mark, you know offhand.

Yes, let me add to that because -- and I don't disagree with what you articulated other than I think the turnaround time of when they get the result isn't as important as when the patient is showing up. So for our providers who like to see the patient at that 8-week time frame, when the provider is showing up, they're able to use our test at that time. So it's more about patient convenience, and it's more about workflow as opposed to when they're getting the result on the back end.

That said, as Sam mentioned, we have very, very competitive turnaround times. So often, they will be getting the answers, maybe 1 week sooner. But again, it's probably less about getting the result 1 week sooner as opposed to meeting the patient when they're coming into that OB/GYN office at that 8-week time period. And again, maybe that's not important to all of the providers, but to those that really care about it, that's where Myriad shows up best.

I see. That's really helpful context. And then maybe just as a follow-up for FirstGene, do you expect to have a similar turnaround time given that it's more of a combined assay, and then FirstGene is launching with the 9-week blood draw? I'm just curious if you're working in R&D on moving that up to 8 weeks as well.

Mark, do you want to take this one?

Yes. So we do expect to, when we launch fully commercially to move it to 8 weeks as well to answer that question. And we also expect a very similar around -- similar turnaround times as well. So yes, I would not expect any major delays related to the FirstGene test.

And just to add, Mark, you had said in your prepared remarks, we've been pleased so far with the sample we've been running, the efficiency, the yield internally, all of that has been working really well. So there's no reason to believe as we ramp into full commercial launch that we shouldn't continue to have really, really tight turnaround times.

And our next question will be coming from Lu Li of UBS.

Great. I think the first one on GeneSight. You're expecting the volume to be mid-single digit to high single digit. And then you also highlight some of the reimbursement win from like California Medicaid. So how should we think about the ASP assumption for 2026?

Yes. I'll start, then Mark and Ben, I'll look at to both of you to answer it. So, Lu, first, I will say very pleased with the team, both our commercial team as well as our payer team, if you will, on our rev cycle and payer market teams, both for being able to really be targeted and engaging customers. And you saw in Mark's slide, we had a record number of new prescribing physicians that also ordered GeneSight within the quarter.

So the results -- remember, we're saying we should be growing at about the mid-single digit. We performed a little bit better than that this quarter. We're pleased by that. And I think in one of your prepared remarks, you also talked about the number of payers we've continued to add on for GeneSight, 9 new states beginning of the year, right, related to biomarker laws. But as it relates to ASP and what to expect next year, either you guys know we're not providing guidance for 2026. Is there any color that either of you would want to offer?

Yes, sure. I'll just maybe repeat that both Mark and I touched on the fact that we've been really pleased to see health plans implementing medical policies in compliance with the biomarker laws. And none of those medical policies have a significant impact in isolation, but we continue to work towards having wins everywhere that we can get those, and we'll continue to do that going forward. And so our expectation is that we will continue to have support with ASP for GeneSight. And like Sam said, we'll talk more about 2026 at a future date.

Got it. And then second question. So I think you touched on some of the organizational structure change. And you also mentioned there's -- and then you're going to shift some of the resources to kind of funding your key programs, but I guess, I wanted to get a bigger picture. Are you expecting any kind of like lower OpEx, like any sizing of that? Like any other areas that you expect to have more lower OpEx in addition to reallocation of the R&D, if that makes sense?

Yes. No, let me start, and then you can add here, too. Listen, again, this is a very deliberate set of actions we've taken, all with the intention of being able to serve our customers better, show up, cover more accounts and improve the overall customer experience and win more. And specifically, some of the things I can tell you maybe answers your question is we will be adding a very meaningful number of additional sales-related positions. That's part of where the savings, if you will, related to our other actions are going to be applied as well as other programs really related to activating the new product launches that are coming up, right, be it the PATHOMIQ, Prolaris launch that we have the, of course, MRD being the most important one. And on MRD, it's both the programs on the marketing activation side, but it's also further on R&D for MRD R&D that we're going to be adding. So that's a high-level answer. I don't know if, Ben, if there's anything you would add to that.

Maybe the only thing I'll add is we'll focus on investment to support our account executives with tools to enable them to be effective in the work that they do.

And our next question comes from Mason Carrico of Stephens.

This is Ben on for Mason. Just on the PATHOMIQ, Prolaris combination test, could you give us some insight into the cadence of clinical data releases on this assay? What should we expect to see, call it, over the next 12 months?

Well, thank you for the question, Ben. We are going to be launching the test, our first combined test in the first half 2026. And again, this will combine our leading molecular test with the AI capabilities, looking at morphology and sting slides and really being able to draw conclusions on that. And the combination of which we believe will drive an increased level of clarity and to help physicians on what they do in treatment. So this is our first test, and it's at the time of biopsy.

What we have planned then for some time in 2027 is another -- the next follow-on offering, if you will, which will allow us also to start addressing parts of the overall prostate cancer segment, which includes what happens post radiation or post radical prostatectomy. So that's a future product to come. But right now, our focus and what we've seen a lot of interest from customers in anticipation is for our first combined product launch in the first half.

Great. And you've highlighted the progress you've made reducing no-pay rates and tightening your RCM initiatives. Would you be able to quantify how much of the 2025 ASP benefit has come from some of these operational factors versus really the new coverage wins? And how much runway remains on the operational side?

Ben?

Sure. Yes. So we've talked about the fact that about 1% decrease in no-pay rate is worth about $8 million or so in revenue. Now it's important to remember that with the change in UnitedHealthcare medical policy, it really muddies the water in changes in no-pay rate year-over-year. We had talked about being at about 42% in 2024, and from a comparison standpoint, it's an apples-to-oranges. And so we're not in a position to quantify the benefit of the impact that we have had this year, but I'll say that we continue to focus on improving no-pay rates and optimizing revenue cycle management.

And then just maybe one more thing for context, as we think about where no-pay rates can go, if you think about across the portfolio, our most mature products in the hereditary cancer space, we're still looking at about a 30% no-pay rate. And so we'll continue to focus on reducing and improving no pays, but that just gives you an idea that the best case scenario from a no-pay rate standpoint, you're still looking at 30% plus with a really, really mature product portfolio. And then I would just add summary of that is we think that there are many years of opportunity and goodness from continued improving -- or focusing on rev cycle improvements to the ASP.

And our next question will be coming from John Wilkin of Craig-Hallum.

So it looks like your MyRisk volume in the unaffected segment ticked up pretty meaningfully versus the last 2 quarters this quarter. And I know you guys have talked about some headwinds that you had seen in Q4 and going into Q1 just with delays in EMR integrations and such. But could you just parse out what you're seeing now that's driving that acceleration and how you see that continuing into the future? And also if you think the expanded MyRisk panel is going to drive any incremental acceleration on top of that?

Yes. Thank you for the question. And, I think, as I might have mentioned, we are pleased with the continued improvement in the performance of the unaffected part of the market with MyRisk. And yes, it is the results and the meaningful impact or the pickup in the volume growth is a combination of really working on the pain points or the areas we can improve on the customer workflow includes the work that's being done by our teams related to EMR abilities, also just thinking -- working with the customers on what does it really take from day 1. It's not just about turning on the EMR, but what is the real experience like, what's happening in the office when orders are being placed, what are the questions that they have?

So all of those things through customer success managers and other positions we've instituted, I think, are starting to make a difference. I think, again, also, we've done certain things related to our programs. We've learned ourselves as we're implementing these breast cancer risk assessment programs to continue to iterate and make those even more fine-tuned to drive value for our customers. So again, trying to identify and be able to identify, and then engage with patients for testing. So all of those activities, I think, have started to show some real promise and real impact already.

There's no reason, by the way, to think that, that's not going to continue staying strong and get stronger as we implement more programs. And yes, we absolutely believe now having an updated expanded MyRisk panel, which, again, will launch this month, will only help support the growth at where we've been or even further. And Mark, I think you had in your prepared comments, this will be -- this panel will be the only one related to -- can you just state those words, the NCCN?

Yes. It's the only panel when you look at the NCCN guidelines as well as the ASCO guidelines, they actually parse out sort of different levels. And so for NCCN, it will be the only panel that includes all the high-risk genes that they recommend as well as on the ASCO side, the ones that are strongly recommended.

So the takeaway is we believe that this will be a very important catalyst for growth going into '26.

Got it. That's helpful. And then just on GeneSight, it sounds like you alluded to that your investments in that business going forward are kind of assuming that there is no change in UnitedHealth coverage, which seems prudent. But does that imply that, that business is going to be maybe less of a priority within the commercial organization? And just how do you balance that with the fact that -- I mean, it seems like that business has seen, excluding the UnitedHealth impact, a lot of momentum this year with added payer coverage decisions and more clinician adoption.

Yes. Listen, I mean, we are pleased with the performance of GeneSight, and we really appreciate the hard work and efforts in a very focused way that our teams have been taking, again, both on the commercial side as well as on the payer market side and so forth. So we think it continues to be an important part of our portfolio. But what we have said very explicitly is in this new phase of Myriad, this new time of Myriad, we are incredibly deliberate, focused and disciplined on what we prioritize, particularly related to development and other growth. And that's really the point on GeneSight.

And I would now like to turn the call back to Matt for closing remarks.

Thanks, Latanya. This concludes our earnings call. A replay will be available via webcast on our website for 1 week. Thank you again for joining us this afternoon, and have a good night.

And this concludes today's program. Thank you for participating. You may now disconnect.

Hi, everyone. My name is Yuko Oku, and I'm on the life science tools and diagnostics team here at Morgan Stanley. Before we begin, for important disclosures, please see Morgan Stanley research disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales rep.

With that, it's my pleasure to host Myriad Genetics. And speaking on behalf of the company, we have President and CEO, Sam Raha; and recently appointed CFO, Ben Wheeler. Thank you for joining us today.

Thanks for having us.

Thank you.

So maybe to set the stage here, you've been working on providing an updated strategy for the next chapter of Myriad since taking on the CEO role. We got a glimpse of that updated strategy on the last earnings call. Maybe to kick things off, could you provide us what you learned during the review process? What are Myriad's strengths that could be leveraged further to unlock shareholder value? And where are the areas that you feel that company could do better?

Yuko, thank you very much for the question. It has been an invaluable process working with the team here over the last several months to really dig deep. And it both revealed new insights for us as well as reaffirmed some of the things that as management, we had held to be true. For example, it reaffirmed that many of the markets that we're participating are very attractive, high growth, reaffirmed also some of our strengths and our right to participate and win, particularly around cancer. and also reaffirmed that the level of resourcing and investment that will be required to really be successful in our intended segments.

In terms of strengths that we believe we're going to be able to leverage going forward, it's absolutely true that we're a company based on science and our reputation for high-quality tests. The confidence that we have from our customer base is very strong. We have a broad reach, particularly in our targeted markets in terms of our commercial capabilities. Operationally, we built truly a world-class sample processing all the way from taking the order through returning the report, which also harnesses our ability to continue driving industry-leading gross margins.

Together with the cornerstone that we have in hereditary cancer testing, we believe we can build much further into what we're calling the cancer care continuum. Now there are opportunities for us to improve in terms of areas for development, one of which is though we focus a lot on the user experience, we can continue to do better there and continue to expand our EMR integrations and the digital experience for our customers. I think just fundamentally, too, you'll hear me, I'm a framework guy talking about 3 things, talking about the right strategy, the right team, the right execution. As it relates to execution, I think we have an opportunity to be better in planning and really getting things done.

Well, let's start with the hereditary cancer market. What is the market penetration within affected and unaffected today? And which of these markets do you see the greatest opportunities, especially following Tempus Ambry and LabCorp and LDT transaction?

Yes. So again, Myriad is founded in many ways that we're still thought of just as the BRCA1, BRCA2 company. We're more than that. But we often speak about the hereditary cancer market as 2 subsegments as much just to help drive our commercial channels and help investors understand. So the affected market, as we call it, meaning those that have already been diagnosed with cancer, that are in the process of being treated. We see that market about a $2 billion market. It's highly penetrated more than 2/3. It's growing in the mid-single digits, and we have shown for multiple quarters in a row that we're growing above that. We've had good strength there.

The unaffected market is approaching $5 billion. It's still well less than 50% penetrated. It's a market that's growing somewhere between high single digit to low double-digit growth. And this is a place where traditionally, we have been the leaders. We've had a little bit of a challenge, particularly related to some EMR integrations. I think we called out a couple of quarters ago. We're starting to address that. But in terms of opportunity, we are really optimistic about both subsegments, if you will, hereditary cancer testing. For the affected part of it, cancer continues to be something where the incidents grow, both the tailwinds of the ongoing new guidelines from ASCO, NCCN, that's a driver. We're excited about launching our new updated MyRisk gold standard panel in Q4 of this year, just coming up.

The unaffected market also, it's the one that takes more activating, but it's one that has a lot of size and we have the right to win in. And some of the programs, and I think I can share more about those, like the breast cancer risk assessment program, partnerships are really going to help us unlock that market.

Yes. Could we dig a little bit more into the breast cancer risk assessment program, given that it is an opportunity to increase awareness around hereditary cancer testing. Could you give us a little brief overview and then how you've recently expanded the scope of that initiative?

Yes, sure. I'll start by saying that the breast cancer risk assessment program is really targeted around the OB/GYN providers and health care sites, if you will. Often, these docs are seeing more than 20 patients in a day. They're also not as certain about how to deal with genetics because they're completely focused on child birth and other earlier stage in a woman's life. We also have a lot of these patients who are focused on, again, around children, and they're not this is conversant or confident around cancer. So the opportunity of the breast cancer risk assessment program, you could think about it as a turnkey solution that we are enabling our targeted or partnering OB/GYN offices with.

And what that is, is all the way with the tools to really drive awareness to help reach their patient population, help identify them. And once they come in to support them with patient education as the testing is done, the results are available to help them with genetic counseling or other support to understand and interpret. So we've started to see some good traction from that, and it's one of the ways that we're starting to help drive the market opportunity.

And partnership with jscreen is another effort you have underway to increase awareness of hereditary cancer screening. Can you provide color around the traction you're seeing through that partnership? And do you have discussions underway to partner with other consumer-initiated programs like jscreen?

Yes, great question. And so we're delighted with the partnership that we have with jscreen. jscreen is a company that's focused on driving education and access for genetic-based testing for certain high-risk populations. And we really -- and we have the best-in-class test for hereditary cancer testing. We also have a partnership there with them for prenatal testing. And really, the way you can -- the way we think about it is it's 2 great companies coming together. And for us, they serve as a channel, right? For activating, they have access to many of the patients that could benefit, and that gives us that reach. And yes, we are very deliberately looking for other meaningful partnerships like that, which would expand our reach into the market opportunity for hereditary cancer testing.

Great. And then I want to shift over to women's health. Prequel and Foresight volume declined 7% year-over-year due to challenges in implementing order management system. Could you provide more color around what happened there? And although it seems like the issue is addressed, how do we get confident that this shouldn't lead to further disruptions?

Yes. Well, as we shared in our last earnings call in the quarter, last quarter in Q2, as we were implementing, as you noted, a new order management system, unfortunately, we found that our customer service folks and folks in the labs, the full information that we needed to process an order, it was just stuck in the system. And we have addressed it. I've personally been all over this, along with our Head of Tech, our COO and other folks and all the samples are flowing through now, and there is no more issue. It's been resolved even before we left the quarter. But in this market, usually, health care providers have a number, at least a handful, 1 or 2 different lab providers that they work with. And the samples couldn't wait. There's a timeliness, if you will. So we definitely lost an opportunity there.

We're starting to see pickup and what we've disclosed is that we expect that by the time the volumes return to above -- at or above market where we have been performing for both Prequel and Foresight, our NIPS and expanded carrier screen test, it's going to take a number of quarters. So you'll see a gradual return. And we expect better results this quarter than we had last. It will take a number of quarters to get back to where we were prior to this disruption.

Okay. Understood. And then you also called out incremental positive payer coverage for expanded carrier screening ahead of ACOG guidelines update, which is largely consistent with what I've been hearing from others in the space. Tell me, why do you think there's been change in commercial reimbursement landscape with expanded carrier screening? And what's the latest you're hearing with respect to ACOG guidelines?

This is such a juicy question. I'm going to ask Ben to weigh in.

So we've been really pleased to see payers move to cover ECS ahead of ACOG guidelines. We've seen a handful of payers make that move. And the fact that they've moved indicates that they've seen value for their insured patients to receive that benefit. The fact that they've moved ahead of ACOG guidelines is an indication with the speed that ACOG is moving. And trying to predict when ACOG is going to make that move has proved to be very difficult. So we're not going to try and make that prediction here. But we will tell you that Myriad is ready when that move is made, both on the ECS side and NIPS side.

Okay. Great. And then FirstGene is available via early access since June with commercial launch expected next year. What has been the early feedback so far? And what proportion of your current NIPS volume concurrently order carrier screening? And tell us how you see this product expanding the overall addressable market for Myriad.

Yes. Thank you for the question. And FirstGene for those that aren't aware, is our combined screening product from one blood draw, able to do both NIPS as well as carrier screening. We are happy so far with the early access that's going on. We've had the targeted customers, if you will, providers that are ordering. They're happy with the results. We're finding efficiency in our labs. The yields are high. Turnaround times are very good. It's still early days, but we're optimistic about the reimbursement side of things, which is also part of the design of the early access to learn all these things. Interestingly enough, the crossover between NIPS testing and carrier screening isn't as high as one might think.

There's a number of reasons for that. Not a small proportion of pregnancies are actually unplanned, for example. Often, the father is not available. It could be a different insurance that they have, could be just availability of access to the father and so forth. So we really see this as an opportunity to expand the market. And just like with an updated NIPS test that we launched at the end of last year, the combination of that at 8-week gestational age and NIPS Prequel test and this FirstGene, we see this as opportunities to help us really grow at or above market going forward for the next couple of 2 to 3 years.

Great. And then Prequel NIPS launch 4Q can be performed for 8 weeks gestational age, which is a key differentiating feature. Could you describe the traction you've seen for that product so far?

Yes. This is what I was mentioning. So conventionally, the NIPS tests out there, including ours in the past for NIPS was done somewhere in the 10-week range. 8 weeks is the more natural cycle when the mother is coming in for a battery of other blood tests. So it just works into the workflow, if you will, for the physician. And so that practicality, we're seeing that resonate in the market. And it is going to be a bigger percentage of our NIPS testing today. I wouldn't exactly characterize the numbers for you, but it's becoming material. And again, we see that as opening up opportunities for conversations, particularly where we haven't been. So new opportunities, new business, and we're excited, again, for that to be one of the drivers for continued growth.

Okay. And then shifting over to oncology here. You're targeting first half '26 to commence early access for Precise MRD and expect reimbursement towards year-end '26. What are the key goals during that early access phase?

Yes. We have a number of goals. First and foremost, it's to get the -- our assay, it's going to be in breast cancer out there to be used with actual patients for real-world evidence around clinical samples. It's to start engaging key opinion leaders and really building their confidence, their endorsement. And it's also to start building the base of customers from which we will really drive volume going into '27. So it will be a year where we're going to, in a very deliberate way, bring the assay to market.

Given the high sensitivity with Precise MRD, you intend to focus on low ctDNA shedding tumors like breast. Could you provide an overview of the clinical data generated thus far in breast cancer and the trials underway to support your MolDx submission?

Yes. So just some background again overall. You're right, our approach when we think about the MRD opportunity, though it's many years now in which MRD has been in the market, we continue to see it as a real opportunity for us. I mean, first of all, MRD, we can debate how big it is, but it is a sizable multibillion-dollar market with a lot of growth, unlike most markets we've seen in diagnostics ever. We have an ultra-low shedding or ultrasensitive, pardon me, assay, and particularly, this is able to detect less than 10 parts per million in blood, the targeted molecules. This is particularly important for low-shedding tumors like breast, ovarian, prostate, renal and so forth.

And the reason we believe that we can really engage and have a place in this market is we will target those cancers. Many of those cancers happen to be the very places where we have established reach and reputation. We know that through primary and secondary research that an increasing number of health care providers and health care systems, what they're looking for is to work with a limited set of lab companies such as ours to really get all the needed cancer diagnostic information. Since we have the gold standard position, both with hereditary cancer with our MyRisk test and also for HRD, which is around PARP inhibitors with our MyChoice test, combine that with our MRD test, we believe we can add meaningful value.

In terms of the second part of your question, we now have more than 20 clinical studies that are underway, many of which are breast. We've started to share some of that data at AACR, at ASCO, which gives confidence to the performance. In fact, we had a publication, I think, just Friday with MD Anderson, which further talked about the real-world performance of the assay. And between patients that have been enrolled and in the process of being enrolled, there'll be more than 4,000 patients, 30,000 data points. So all of which -- and we will have publications ready to support in Q1 filing with MolDx. And we expect reimbursement usually around -- we're leaving about 12 months. So the end of the year, early next -- early 2027. But we're not going to wait for that. We are choosing strategically to enter the market for the 3 objectives that I shared with you.

Great. And as you highlighted, MRD market is a very large attractive space. And we're seeing a lot of emerging competitors coming in. So how do you intend to penetrate that market with strong competitors already in the space?

Yes, it's a great question. Again, I'll just talk again, to summarize the things I talked about. We have an established reputation, a very strong one in breast, prostate and a number of these other cancers. We have the reach reputation. We have the systems that are used in the EMR sense to really serve these customers. We believe we can put this all together with the other leading tests and also the way we can generate a report that makes it easier to interpret and make decisions when times of the essence. So though we're a little later than we'd like to be into the market, we think that the market is going to be served by multiple companies, and we absolutely feel that we have the right to be one of those companies.

You're also planning on launching first AI-enabled Prolaris test with partner PATHOMIQ by year-end. Tell us how this version of Prolaris is intended to deliver incremental value over the current version. And as we think longer term, how should we think about the next version enabled by the partnership that will open up the post-RP opportunity?

Yes. Thank you for the question. And we are excited about the partnership with PATHOMIQ. And in fact, it is an example of something that we've defined in our updated strategy as part of the cancer care continuum that we will leverage to be even more timely to market partnerships that really complement the capabilities and strengths of Myriad. And this is a case for that. And the first test that we're bringing to market, and by the way, we may deliberately choose to bring this out in the market in Q1 because part of execution excellence that we're going to get better on is being very thoughtful about how we drive the awareness and go to market of tests. And since in Q4, we have MyRisk, our first update to that test in some time coming out, which we're really excited about.

We're probably going to target Q1 for this combined test with PATHOMIQ. So what it does is essentially brings the power of our leading molecular-based prostate cancer test together with the AI capability, which starts from a scan slide, looking at the morphology and the value to providers that use this is a higher level of confidence at the time of biopsy to determine if you should actively survey or you should move into some sort of different measure of surgery and so forth. This is the beginning.

What we are excited about down the line, too, is to introduce a test which will allow us now through the combination with the AI capability to participate in post-radical prostatectomy or postradiation. And mind you, for us, that's a blue ocean. That's not a space that we participated in, in the past. So we're excited about that. And by the way, this is our first start with AI, but we see AI as something that will become part of our portfolio across other cancer types as well.

Last quarter, you also mentioned that you'll no longer be launching Precise Liquid on your own, but partner to pursue the CGP opportunity. Could you elaborate on the rationale to partner versus do it alone?

Yes, absolutely. We had acquired some assets about 1.5 years ago from Intermountain Precision Genomics, which is the basis of our Precise tumor test today, our CGP test for solid tumor. And while we're excited about that test, and that's a part of our portfolio, as we really evaluated the work that needs to be done and also the attractiveness of the test, this is part of the new discipline of the company and the rigor and discipline going forward. We just determined the amount of time that we would have to spend developing this, there are other things that are better served, such as doubling down on MRD and working on the other tests, the updates to MyRisk. And we can come to market faster by having a partnership around Liquid. And so yes, as you mentioned, we are evaluating some different options of partnerships that allow us to fill that part of our portfolio with a Liquid CGP test that complements our continuum of cancer care test.

Shifting over to GeneSight. You're planning on submitting 3 additional publications as part of United's typical review cycle in the fall. Could you remind us the incremental data that will be provided to United? And then you recently highlighted a new meta-analysis that demonstrates access to GeneSight can significantly improve response and remission rates for patients with depression. Could you provide highlights on that study as well?

Sure. Right. Coming into the year, we had shared that our plan was to share 3 different pieces of updated information, scientific data with UnitedHealth. We're right on plan of that. We had done the first such submission at the beginning of the year. As you noted, we published a paper. In fact, we did the press release, I think, just last week. which showed that based across more than 3,500 patients, which comes from 6 different studies, the meta-analysis showed for those that have depression that there is a significant statistically meaningful improvement in both in response and remission. And I think that the strong data set really helps drive the value of the market-leading GeneSight test for mental disorders.

We have a third test planned that will also -- excuse me, not test. We have a third publication, more scientific information planned for submission to UnitedHealth in a couple of months. And listen, I also just want to be clear. We continue to be excited about the GeneSight franchise, the actions we've taken, it's returned to a good level of mid-single-digit growth. But our expectations are that we're not sure that there's going to be any change from UnitedHealth. If it happens, it will be a positive upside. It's not in our LRP or anything of that sort. I will tell you that we are excited that we have lost no other payers since the UnitedHealth decision. In fact, we've added a number of payers already this year. And these sort of publications both help us with potentially in the engagement with UnitedHealth, but also to bring on other new payers, if you will.

Great. And you've also recently undergone reorganization of the pharmacogenomics commercial organization. So tell us the size of the organization now and why you believe mid-single-digit growth in the franchise is sustainable despite sizing down on pharmacogenomic commercial organization.

Ben, do you want to take this one?

Sure. So Sam touched on the reorganization just lightly a moment ago. We did -- we made the difficult decision to make adjustments to that organization during Q1, and that impacted both people and resources. As the dust settled in Q2, we saw them return to mid-single-digit growth. We were really pleased with the speed with which they returned to that growth. We anticipated that they would achieve that growth. They just did a little bit faster than we anticipated, and we were really pleased to see that. I don't have the numbers in front of me relative to the size of that commercial team, but I'd point you to some of the data that we've shared in prior Investor Day slides that do give information regarding our commercial teams.

And then you've been dealing with some EMR integration-related challenges, which affected your volume in hereditary unaffected business. Could you describe the specific challenges you encountered and what you're doing to address those issues? With your call commentary indicating it would take several quarters, when do you think those headwinds will be fully behind you?

Yes. We talked about hereditary cancer unaffected at the beginning of this question, Q&A session. And we remain very, very excited about that opportunity. The EMR challenges we had, it's more around the workflow, if you will, to enable customers. And for example, when you look at the workflow for the unaffected, again, those that don't have cancer, one very important part of it is to help actually use a questionnaire to even identify who qualifies based on familial history for testing. And as it turns out, whereas we automated so much of the overall experience for providers and patients to the EMR work, we hadn't integrated that upfront questionnaire. We're excited. We're about ready to launch that in a partnership with Epic.

There are other things about sample collection kits that weren't automatically being triggered and so forth. But as I disclosed on the last quarterly earnings call, here too, a little bit like Ben was saying around GeneSight, I'm pleased that we're executing a little faster and a little bit better than we had anticipated. So to return to the level of volume to grow at or above market, and we intend to grow above market here, I think it's going to take a number of quarters. We already saw an improvement in Q2, and I think you're going to continue seeing that as the quarters -- in the coming quarters.

And with investments into your labs of the future essentially complete, help us understand where you are in terms of ramping sample volume on NovaSeq X. Can you provide an update on how the transition has been progressing and walk us through the incremental benefit on margin as a result?

Yes. We're very pleased with the major labs of the future initiative that we had undertaken for a number of years. Again, as a reminder, this is a combination of moving into new facilities that are modern and the right places for us to be processing samples. It's about upgrading to the right instrumentation such as updated sequencers that are appropriate for the test that we have. It's about optimizing workflows and a number of things. And overall, we're starting to see the benefits already. This year, we're seeing the productivity increase in terms of the number of individuals in our -- I have to touch a sample. That's decreased per sample.

It's helping support our industry-leading gross margins. I think for the year, Ben, we've provided an updated guidance somewhere in the 69.5% to 70% range for gross margins. That's strong. And we see the opportunity for the work that we've done there and continue to do to support continued reduction in cost per test, particularly for our high-volume tests that we have. So we think the work that we have done will continue to be a source of goodness and value for us on a cost standpoint, enabling us to be more competitive and have better ASPs -- excuse me, and have better gross margins in the coming years.

You recently updated your long-term revenue growth target to high single-digit to low double-digit range. Can you lay out your underlying assumption for the increase in HCT versus women's health, oncology and GeneSight? And then any color around ASP and volume trends?

Yes, sure. Well, listen, we're going to provide more detail. I think I've said that in the coming months, probably as we get closer to January. But what I can tell you now is, as we did our deep analysis as part of our strategic review, we looked again at every market. And we look at the -- I'll start with the prenatal market. The prenatal market, again, is growing somewhere in the mid-single-digit range. And we believe that based on, as I was mentioning earlier, the traction we're seeing for our updated Prequel NIPS test, the opportunity we have for market expansion with FirstGene, this is a combined screen test. These are the drivers that allow us to grow at or above market. So that's in the mid-single digit at least range with the prenatal products.

For GeneSight, which is the mental health market, we believe that's a market that's growing in the mid-single digits. We are the market leader. with very strong level of market share, and we continue to see growth there. And there, it's about execution, about being at the right accounts, focusing on those accounts where we believe that we have a better chance of getting paid. It's about the new coverage we continue to get, and we've announced several even this year. So that's in mental health.

And you look at oncology, we've talked a lot about unaffected and affected. And both the combination of the market-leading tests that we have, along with the new tests that we're bringing out, which include an update to MyRisk, which includes the new MRD test we've talked a little about and other partnering tests we're going to bring in, we believe we're going to be able to grow this at least at high single digits to low double digits for oncology. You put that together, I'm not being precise yet. Like I said, I will be when we get into January.

But it gives us a lot of conviction that, that, along with the stability that we're seeing in the ASP with a lot of great work that's being done by our rev cycle and payer markets teams to engage as it relates to policy, the work we're doing related to prior authorization, the work that we're doing related to actually working on denials and claims gives us confidence that we'll be able to grow at least in the mid-single digit -- excuse me, high single-digit to low double-digit range and more detail to come.

You've taken down the OpEx guide for the year. Given the strategic review, where do you see areas of continued investment? And where are the areas there could be a pullback in spend?

Ben?

So our resource allocation strategy aligns with our growth strategy. So we'll focus resources on the cancer care continuum while still focusing growing prenatal and mental health at or above market. And I'll just remind you, as Sam has shared in the prenatal space, we -- last year, we had our expanded Foresight panel, our expanded carrier screening panel. We also launched Prequel at 8 weeks, and we recently launched FirstGene. So commercial execution in those areas is what we believe will allow us to grow at or above market in prenatal and then just the commercial execution on the GeneSight front is what we believe will allow us to grow at or above market in mental health.

And you just strengthened your balance sheet with $200 million OrbiMed transaction. Do you feel that you are sufficiently capitalized to invest for growth?

Yes. We believe that we've got the capital that we need. We're pleased with the strength of the balance sheet and that we have what we need to execute on our growth strategy.

And how are you thinking about top priorities when it comes to capital deployment, including M&A opportunities? Are there any specific areas that you're focused on where you think inorganic would make the most sense?

Yes. So Sam's talked about partnerships in the areas in the cancer care continuum where we are focused relative to opportunities for CPG. And we want to compete across the cancer care continuum. We believe that there are things that we can bring to market that are in our pipeline. And then there are other areas that we believe we'll be able to compete more quickly and more readily through partnership. We have an opportunity to execute on those things that we've talked about in our pipeline, and that's what we're going to do.

Maybe in the last couple of minutes here to wrap up, what about Myriad's story is least well understood and appreciated by investors in your view?

Yes, sure. I think that I'd summarize, though I've touched on a number of these things throughout the session here this morning. We are in attractive markets, and we have an intention to also participate both through what we're doing in MRD and other partnerships in other high-growth attractive markets. We have market-leading reputation and reach, which we're going to be able to leverage, particularly across the cancer care continuum. Also, the fact is we came into this year with a really difficult set of circumstances. And we've been able to weather that.

And despite all that, we're on track to have a year where we're going to have positive adjusted EBITDA and it shows the strength of the company and the fundamentals of the core business. You put that together with the excitement we have for the new products that we intend to launch, now you'll start seeing a stream of new products over the next 2, 3 years, starting next quarter with the MyRisk expanded panel, if you will. And together with the team, feeling really excited. And it's all about who you have the right team that really understands the market and you can execute.

So pleased to have Ben in the role. Ben has been with the company 14 years. He's our right CFO right now. We have a new Chief Commercial Officer, Brian Donnelly, who joined us from Ancestry. -- part of -- we work together at Illumina. You put that together with the stepped-up rigor, discipline and urgency that we are running the company, I feel absolutely confident the best days ahead for Myriad, for our patients, for our providers and for our investors.

Great. Well, with that, thank you so much.

Thank you for your time.

Good day, and thank you for standing by. Welcome to the Myriad Genetics Second Quarter 2025 Financial Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Matt Scalo. Please go ahead.

Good afternoon, and welcome to the Myriad Genetics Second Quarter 2025 Earnings Call. During the call, we will review the financial results we released today. And afterwards, we will host a Q&A session. Our quarterly earnings release was issued this afternoon on Form 8-K and can be found on our website at investor.myriad.com. I'm Matt Scalo, Senior Vice President of Investor Relations, and on the call with me today are Sam Raha, our President and Chief Executive Officer; Scott Leffler, our Chief Financial Officer; and Mark Verratti, our Chief Operating Officer.

This call can be heard live via webcast at investor.myriad.com, and a recording will be archived in our Investors section of our website, along with the slide presentation.

Please note that some of the information presented today contains projections or other forward-looking statements regarding future events or the future financial performance of the company. These statements are based on management's current expectations, and the actual events or results may differ materially and adversely from these expectations for a variety of reasons. We refer you to the documents the company files from time to time with the SEC, specifically the company's annual report on Form 10-K, its quarterly reports on Form 10-Q and its current reports on Form 8-K. These documents identify important risk factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements.

With that, I'll now turn the call over to Sam.

Thanks, Matt. Good afternoon, everyone, and thank you for joining us. Before I begin, I want to share that I believe today, as I did when I joined the company, that Myriad is really good at a lot of things and we have significant potential, but we have not lived up to our potential yet. I'm excited about the journey we're on to live up to that potential by focusing on high-growth market segments and executing with stepped-up urgency and strengthened execution rigor. Let me start with our results.

I'm pleased to report on the overall progress the team has made, both financially and operationally in the second quarter. We generated revenue of $213 million, representing an increase of 5% year-over-year when you exclude UnitedHealthcare's decision on GeneSight and the divested European EndoPredict business.

Growth in average revenue per test during the second quarter, up 2% year-over-year with growth across most of our tests year-over-year was a leading contributor to our strong Q2 results. This growth in underlying average revenue per test has been enabled by great execution in Q2 and over many quarters on multiple programs that are part of our pricing improvement operational plan by our strong revenue cycle team. There are no material revenue contributions from prior periods. This momentum certainly provides a nice tailwind in the second half of the year and supports our profitable growth journey.

Our strong results were also enabled by the actions we have been taking to address the challenges we noted on our Q1 call. I'm pleased that our execution has been better and quicker, contributing to our better-than-projected revenue growth, a step forward on delivering on Myriad's potential.

Now I want to talk about testing volume. We continue to have strong volume growth for MyRisk HCT in oncology at 14% over the year ago quarter. We saw a return to volume growth from MyRisk HCT for unaffected as our efforts on addressing previously identified challenges with customer workflows, including EMR functionality, are starting to be addressed, which Mark will talk about further in his section. GeneSight volume increased from low single digits to 5% growth year-over-year as we had anticipated based on our organization settling in after deliberate cost savings related actions we made in Q1 and our focus on targeted accounts.

Prolaris volume, as we anticipated, was slightly down year-over-year against a strong Q2 of 2024 compare but up 6% sequentially over Q1 of 2025. Volume for our legacy prenatal products, Prequel and Foresight, declined 7% year-on-year. This was based on challenges we had with implementing an order management system, which slowed down orders in Q2. I've been close to this, working with our CTO, Kevin Hass, Mark Verratti and our Chief Commercial Officer, Brian Donnelly. We have fixed the prenatal ordering system issue. There's no remaining impact to customers, and we expect to see improving trends in prenatal volume growth starting in Q3.

Along with maintaining strong growth for hereditary cancer testing in oncology, mid-single-digit growth for GeneSight and resuming growth for our prenatal products, we are actively executing programs to increase growth for HCT and unaffected and Polaris. We believe these actions will lead to increasing volume growth in Q3 and Q4 and enable us to enter 2026 with momentum.

Turning now to profitability. We generated strong adjusted gross margin, 71.5% in the second quarter or 140 basis points greater than last year and closely managed our discretionary spend as reflected in our adjusted OpEx line, ultimately reported strong adjusted EBITDA of $14.5 million or 24% growth over last year and $0.05 of adjusted EPS for the second quarter.

I'm pleased that Myriad secured a $200 million term loan from OrbiMed, a well-known investor in the health care industry. We ran a thorough process working with Evercore and we're very happy with the number and quality of interested lenders. We're excited to partner with OrbiMed on the credit facility, which provides us with liquidity and flexibility to support our growth journey. The journey ahead will be enabled by our updated strategy intended to drive accelerated growth and profitability by focusing on the Cancer Care Continuum as we will refer to it as the CCC.

Before I share more about our strategy, let me note that based on our Q2 results and the progress we're making on addressing identified challenge, we are raising guidance for 2025. Scott will share more details in his section.

Now on the next slide, I want to provide a summary of our updated strategy. Since becoming CEO, one of my top priorities has been to work on updating our long-range strategy to provide clarity on our direction for this next chapter of Myriad. Since May, we made significant progress on advancing our strategy work. While next-level details will be completed over the coming months, the core of our updated strategy is to drive accelerated growth and profitability by focusing on the Cancer Care Continuum. There are 3 strategic pillars to support its achievement.

On the next slide, let me start by answering the question, why focus on cancer? After careful consideration of different possibility, we're choosing to focus on the Cancer Care Continuum for a number of reasons. The cancer-related market is sizable and growing with good reimbursement. We are a pioneer in cancer diagnostics and have a strong reputation for high-quality products established over 30 years. We have market-leading products for HCT and HRD, and we have extensive commercial coverage with health care providers and systems.

Now let me walk you through our first pillar, focusing on the Cancer Care Continuum to accelerate growth. We will leverage our leadership in hereditary cancer testing and increased growth with initiatives such as the breast cancer risk assessment program, the upcoming launch of the expanded MyRisk panel. We plan to expand our testing portfolio in other attractive cancer segments, such as therapy selection, including comprehensive genomic profiling and HRD assays, immuno-oncology therapy response monitoring and MRD. As you can see here, these are large, high-growth market segments, and though there are other companies in these areas, we believe we have the opportunity to build meaningful revenue streams here based on health care providers and systems wanting to work with only a handful of specialty diagnostic labs that they trust who can provide multiple tests that they need. And we will leverage the established trust and reach that we have with thousands of relevant health care providers.

Strategic partnerships, such as the one we have with PATHOMIQ to enable us to provide prostate cancer tests that combine the power of molecular and AI analysis will help us bring compelling test to market faster. I expect to have more exciting news regarding strategic partnerships to share with you over the coming quarters. Also, as part of this pillar, we will plan to increase our investment in R&D for the CCC and focus on enhancing our commercial capabilities and customer digital experience.

On this next slide, let me move to the other 2 strategic pillars. While we are focusing on accelerating growth in the Cancer Care Continuum going forward, our second strategic pillar reflects our recognition of the opportunity to meaningfully grow prenatal health and mental health revenues at or above market growth. We will do this in prenatal health by leveraging recently launched tests, including Prequel NIPS that can be performed 8 weeks into pregnancy and an expanded Foresight carrier screen panel, both of which have been well received in the market. In addition, we recently commenced early access for our FirstGene multiple prenatal screen that we believe has significant potential to expand the prenatal market over time and plan to do a full commercial launch in 2026.

We expect to continue to grow revenue for our market-leading mental health test GeneSight by focusing on high-volume accounts and leveraging state biomarker laws, building on the success we've been seeing this past quarter, including a number of payers newly initiating coverage of the test and while we achieved this growth for prenatal and mental health while maintaining a disciplined level of resourcing and investment in these businesses while prioritizing investment in the Cancer Care Continuum strategic pillar.

The third strategic pillar is about our focus and commitment to delivering sustained profitable growth. While we will provide further financial detail in the future, we believe execution of this updated strategy will enable us to grow revenue in the high single-digit to low double-digit range and increased profitability over the next 5 years by complementing the revenue growth drivers outlined in the first 2 strategic pillars with increasing focus on maintaining financial discipline, growing revenue faster than operating expenses and strengthening our planning and execution capabilities. We expect to fund near- and longer-term revenue growth, in part, by maintaining industry-leading gross margin profile, which is enabled by low cost per test, leveraging operational excellence and stable pricing, leveraging strong revenue cycle capabilities.

Moving now to the next slide. I've already shared when introducing the CCC strategic pillar why we're choosing to focus on cancer and our strength that we believe we can leverage to drive accelerated growth and increase access for patients. I want to take a moment to share what we're going to do differently from before to enable our intended success. First, it's about capital allocation. We're going to be disciplined in prioritizing investments, resources and organizational focus on attractive Cancer Care Continuum opportunity.

Next, it's about compelling portfolio. We plan to expand beyond the established tests we have in HCT and HRD to complement them with relevant offerings for other important high-growth testing applications. Next, it's about strategic partnerships. Unlike before, we see an increasing opportunity to serve attractive market opportunities in a timely manner by complementing Myriad's differentiated capabilities by leveraging select partnerships. And finally, it's about execution. We've started to and will think and act with elevated urgency and strengthen execution through enhanced processes, continuing to add the right talent and elevated rigor and discipline.

I'm confident that the implementation of our updated growth strategy based on these 3 strategic pillars that I shared with you along with strengthening our organization and execution will enable Myriad to drive sustained profitable growth.

Now let me hand it over to our COO, Mark Verratti. Mark?

Thanks, Sam. Turning to the second quarter. I would echo Sam's comments regarding the strong broad-based trend in average revenue per test, which was driven by a combination of test mix, sales targeting, revenue cycle projects and expanding payer coverage. Looking at our businesses.

Hereditary cancer revenue grew 5% for the quarter, reflecting 10% volume growth year-over-year in our oncology channel and a modest but improving 3% volume growth in the unaffected population. This is -- this improving volume growth trend in the unaffected market is particularly important as it reflects an improving EMR environment due to focused workflow improvements put in place in our first quarter.

Consistent with what we said on our first quarter call, these improvements can take several quarters to produce results, so we are pleased with the Q2 progress and expect continued growth throughout the coming quarters. As we discussed in Q1, we are expanding our breast cancer risk assessment program including a fully automated process that enables providers to rapidly identify patients who qualify for additional screening. We continue to see positive momentum in our initial sites and expect to make further investments in our commercial capabilities to accelerate this program through the second half and into 2026 to fuel growth in our MyRisk volume.

Our prenatal performance was mixed in the quarter as revenue grew 7% year-over-year, helped by expanded payer coverage for Foresight expanded carrier screening, but volume growth declined due to temporary interruptions encountered in the transition of our internal prenatal order management system. We have fixed the issue in the second quarter and do not anticipate further disruptions from our system change.

Moving to oncology. In the second quarter, total Oncology revenue grew 4% over the second quarter of '24 driven by strong hereditary cancer testing. I would call out that our MyRisk test continues to gain share in the affected market in the second quarter as volume grew 14% year-over-year.

Shifting to prostate cancer, Prolaris revenue in the second quarter grew 4% year-over-year, an improvement from the last few quarters. Overall demand remains relatively consistent with 2024 trends and does not appear to have been impacted by the Q4 '24 update to NCCN guidelines. And now that we have announced our partnership with PATHOMIQ, we are excited to incorporate their AI technology platform into our portfolio. With the target of a first quarter '26 launch, Myriad will be the only company to offer AI, biomarker, germline and tumor profile testing.

Although our volume has been relatively consistent, we are not pleased with this business performance and feel Prolaris has strong clinical utility and provider support. As mentioned on previous calls, we are investing in the commercial channel and other programs to grow and regain share in this market.

I'm also excited to call out, in collaboration with National Cancer Center Hospital East in Japan, new clinical data regarding the use of Myriad's ultrasensitive Precise MRD test was presented at this year's American Society of Clinical Oncology Conference in May. This data showed that 100% baseline sensitivity and that 60% of patients testing positive 1 month after surgery had levels only detectable via our ultrasensitive MRD test. We are excited to commence an early access launch of our ultrasensitive Precise MRD test in the first half of 2026.

Moving to our Women's Health business. In the second quarter, Women's Health delivered revenue of $90 million, an increase of 4% over prior year period. As I mentioned earlier, we are pleased to see incremental positive momentum in hereditary cancer testing in unaffected market, with revenue growth of 1% and volume growth of 3% year-over-year. We remain optimistic about our increasing tailwinds from EMR integration and breast cancer risk assessment program implementations. In addition, we are seeing continued positive traction in hereditary cancer testing from our expanded commercial partnerships like jscreen.

As for prenatal testing in the second quarter, we encountered modest volume headwinds as we discussed, we fixed the internal issue and anticipated prenatal test volume to accelerate in the second half of the year. As for our commercialized test, Prequel at 8 weeks and Foresight, we continue to see positive demand. And I would call out incremental positive payer coverage for the expanded carrier screening panel ahead of any ACOG guideline update.

Lastly, the team is excited about the early access launch of our first gene multiple prenatal screen in June. We believe this test provides added insight to providers and has the potential to expand the overall addressable market. We are looking forward to full commercial launch next year.

Turning now to Mental Health. In the second quarter, the team generated GeneSight revenues of $38 million on volume growth of 5% year-over-year, an improvement from our first quarter that was impacted by the realignment of group resources. We continue to drive expansion of the ordering provider base, achieving a record number of ordering clinicians to over 36,000 in the second quarter.

While quarterly revenue continues to be impacted by UnitedHealthcare's coverage policy change, we continue to make progress publishing additional data, such as the meta-analysis accepted for publication in the Journal of Clinical Psychopharmacology that follows the economic utility data published in the same journal in Q1. We expect United to review our new clinical data as part of their typical review cycle in the fall. While we continue to work with United to achieve a successful outcome for both parties, we continue to make forward-looking decisions assuming the status quo.

We are excited and proud of our payer markets team for securing positive coverage policies for GeneSight in Q1 and Q2 related to biomarker laws. Most recently, the California Medicaid program, Medi-Cal, added GeneSight with a September 25 effective date. Noting, we have not seen any new negative policies this year.

I am proud of our GeneSight team that continues to drive growth and focus on the unmet need in mental health care treatment. Building on what Sam shared, our strategy for GeneSight growth includes continuing our highly effective digital engagement from driving provider and patient awareness to provider onboarding. It also includes optimizing patient direct payment options and optimizing revenue cycle workflows to maximize reimbursement.

I will now turn the call over to our CFO, Scott Leffler.

Thanks, Mark. I'll start with a recap of our Q2 consolidated financial results. For the second quarter, we reported revenue growth of 1% year-over-year, with test volume down 1% but average revenue per test, up 2%. The improvement in second quarter overall revenue per test reflects a combination of product mix and the expansion of payer coverage for a number of tests. There was no material contribution from prior periods in either the second quarter of 2025 or 2024. Therefore, we have a fairly clean view of underlying organic rate trends, which continue to be very encouraging.

While Q2 rates were unfavorably impacted by the change in UnitedHealthcare policy with respect to GeneSight coverage, we continue to see a positive trend in underlying rates across our portfolio. This is a continuation of the generally positive trend we have been reporting for at least a year now and represents another proof point for the great work being done by our revenue cycle and payer markets teams, along with others throughout the company.

As we have said before, I want to emphasize the sustainable nature of these improvements, which we believe represent both the great work being done by our team as well as the maturation in the reimbursement landscape for our products. As Mark pointed out, the hereditary cancer testing in the affected population saw the strongest revenue growth in the second quarter, with revenue increasing 9% year-over-year. Our Pharmacogenomics business saw revenue declined 12% year-over-year due to the impact of the UnitedHealthcare coverage decision, but volume growth year-over-year rebounded in Q2 as the team adjusted to reallocated resources.

You may recall that we attributed the underperformance in GeneSight volume growth in Q1 to the transition associated with our reorganization of the commercial organization in pharmacogenomics. We had predicted that once the newly organized team had more time to stabilize, we would see a recovery in volume growth trends. The recovery to mid-single digits volume growth for GeneSight in Q2 is a validation of that view.

The combination of a reacceleration in GeneSight volumes and unaffected HCT volume represents an important proof point in our efforts to recover from the headwinds we cited in Q1, buoyed by the incremental strength and reimbursements. Even with the modest overall Q2 revenue growth, we were able to expand our gross margins by 140 basis points to 71.5%. This year-over-year improvement reflects favorable test mix, expanding payer coverage and lab efficiencies and is a testament to the power of our scalable business model.

Second quarter adjusted operating expenses increased minimally year-over-year and reflects cost controls across SG&A. We continue to focus on striking the right balance between investment for future growth and profitability, with a concerted effort to divert spend to areas consistent with our strategic priorities.

While we are pleased with the favorable progress in our overall business results, we did have a significant noncash negative item impacting our GAAP results. Due to the significant and prolonged decline in our market capitalization this year, we recognized impairment charges of $317 million of goodwill and intangibles in the second quarter. This charge is noncash and excluded from non-GAAP EPS. It is important to emphasize that this charge does not represent a meaningful change in our business outlook. We are simply following standard accounting practice, which required that we test the carrying value of our goodwill and intangibles in light of the drop in market cap.

Without getting too deep into the mechanics of the process, our testing result was adversely impacted by factors such as much higher assumptions regarding cost of capital in connection with the drop in market cap. So I would characterize the charge as the result of developments that had already occurred earlier in the year as opposed to any deterioration in expectations.

Next, I'll speak to the trends supporting overall robustness in revenue per test. For a while now, we have provided details regarding a number of key drivers for sustainable progress in average revenue per test, including various investments and initiatives by both our revenue cycle and payer markets teams. We continue to see positive traction from these ongoing investments in revenue cycle workflows and from our ongoing payer engagement activities. These include, among other things, working with health plans to encourage their implementation of medical policies that conform to state biomarker legislation.

As discussed on prior earnings calls, there is a growing list of states that have passed biomarker legislation that lends itself to ensuring access to precision medicine and advanced diagnostics. As we've mentioned, we recently received expanded commercial and Managed Medicaid coverage for GeneSight, and as Mark called out, we are pleased to see California's Medicaid program, Medi-Cal, commencing coverage beginning in September. And there are several other payers who have moved forward with GeneSight coverage.

Perhaps the most significant area of progress has been in prenatal testing, where we have seen a significant uptick in payers covering expanded carrier screening, even without an update to ACOG guidelines that has been anticipated for such a long time. We applaud the progressive approach that many payers are now taking to cover ECS testing, and we see this trend continuing to benefit prenatal reimbursement going forward.

Year-to-date, our team has won 49 new product coverage or medical policy expansions from payers as we seek to bridge gaps in coverage across our no-pay universe. As I have said in the past, no one of these wins will generally meaningfully move the revenue needle, but we certainly expect the accumulation of many small and medium-sized wins over time to contribute to the maturing and more stable rate environment for our products.

Next, we'll take a deeper look at the unusual items impacting our year-over-year revenue trajectory to provide a better sense for performance of the underlying business. While revenue in Q2 of this year compared to Q2 of 2024 grew 1%, you've also heard Sam reference a second quarter 2025 revenue growth rate of 5% after adjusting for the impact of certain items on our Q2 of 2024 baseline, namely, UnitedHealthcare's net impact on GeneSight of $7.1 million and the divestiture of our EndoPredict European business of $2.4 million. With these adjustments, we are able to show what we consider to be a clearer view as to Myriad's underlying performance trends.

Next, let's discuss the company's recent capital raise. Last week, we entered into a 5-year term loan with OrbiMed, a well-known health care investor. This agreement provides Myriad an initial tranche of $125 million immediately at a floating rate of 1-month SOFR plus 650 basis points or an annual interest rate of approximately 11% at current rates. The agreement also has a 2-year option to draw on an incremental $75 million of committed financing reaching a potential total loan amount of $200 million.

Initial use of proceeds was to replace our existing ABL facility from which we had drawn $60 million as of the end Q2. Including the option to draw on the second tranche of the facility, we have an estimated total potential liquidity of over $200 million. We are thrilled with this financing and consider it to be a significant upgrade from our previous capital structure.

While the interest rate on drawn amounts was previously lower, our previous ABL was a short tenor facility with only minimal opportunity for incremental financing given its reliance on accounts receivable balances. Our objective was to obtain a larger amount of financing in order to ensure multiple years of liquidity comfort and the ability to invest as needed in areas of strategic prioritization.

This facility provides that. While the rate on the initial tranche is higher than the ABL rate, we are excited to have the second tranche of committed capital at minimal cost. The blended rate we are paying for $200 million of committed capital for both the drawn first tranche and the undrawn second tranche is approximately 7%.

Lastly, we generated $14.5 million of adjusted EBITDA in the second quarter, a significant improvement over first quarter. The combination of our strong gross profit base and increasing levels of adjusted EBITDA profitability demonstrate the profit and cash generating potential of the business, especially as we generate more operating leverage over our operating expenses. The fact that we're able to generate such a strong EBITDA quarter, despite the headwinds that we have encountered this year is a testament to the profit generating potential of the business as we reaccelerate growth.

Next, I'll cover our full year 2025 guidance. For the full year 2025, we are updating the financial guidance that was previously updated in May. We are raising our full year revenue range to $818 million to $828 million, largely reflecting our positive Q2 revenue performance. We are also increasing our gross margin range to between 69.5% and 70%, and increase in the adjusted OpEx range to between $562 million and $568 million. We are keeping our adjusted EPS between a loss of $0.02 and a gain of $0.02 for full year 2025, reflecting the incremental interest expense associated with the new financing. Lastly, we are also raising adjusted EBITDA to between $27 million and $33 million.

We are not providing quarterly guidance. But please recall that the third quarter is seasonally slower than the second quarter. In addition, Q3 of 2024 will be an unusual comp due to a large almost $9 million added period benefit in that quarter, which we do not expect to repeat this year despite the fact that the underlying rate environment remains even stronger in Q3 of this year than it was in Q3 of last year.

Now let me turn the call back to Sam.

Thanks, Scott. Overall, Q2 results were positive and demonstrates the profitability potential of our business model. Strength in our core oncology HCT franchise continues and an improving unaffected HCT business reflects progress with the EMR integrations. We think these trends will continue in the second half.

Q2 also demonstrates the ongoing execution of our payer markets group, supporting more coverage of our portfolio further supporting overall growth and profitability. The team is also excited to move forward with a clear, focused growth strategy. The priorities that underpin this strategy will go a long way to enhancing our focus and execution rigor across the organization. While we plan to provide additional details in the coming months, our updated strategy better positions Myriad to achieve this mission, advanced health and well-being for all and to positively impact an increasing number of patients while driving accelerated growth and profitability.

I'll now pass the call over to Matt for Q&A. Matt?

Thanks, Sam. And as a reminder, during today's call, we use certain non-GAAP financial measures. A reconciliation of the GAAP to non-GAAP financial results and a reconciliation of GAAP to non-GAAP financial guidance can be found in our earnings release and under the Investor Relations section of our website. Now we're ready to begin the Q&A session. [Operator Instructions] Operator, we're now ready to take the Q&A portion of the call.

[Operator Instructions] Our first question comes from the line of Doug Schenkel from Wolfe Research.

I really want to focus a couple on the strategic review. I appreciate all the qualitative details. I do think it would be great if there were more specific KPIs that we could use to measure progress, both in terms of the near term and the long term. Is the intent of this update today to demonstrate, hey, we're making progress. We're working on this but to basically make the point that the KPIs are coming soon? So that's the first question.

The second is the language you're using seems to suggest that you've completed the strategic review of the portfolio. So should we essentially believe at this point, there's not divestitures coming, you are happy with the portfolio plus the pipeline as currently built?

And then last one, I will get back in the queue after this. A lot of what you described makes sense. I would also say like a lot of it sounds pretty unobjectionable, and I would imagine that would also be the case with some of your predecessors. They also wanted to grow more than the market. They also wanted to grow revenue more than OpEx, things like that, that make a lot of sense but are objectionable. What is the biggest thing that's changing here relative to previous administrations?

Doug, thank you very much for the questions. I appreciate it. You're spot on. Absolutely, this was intended to share where we are with the strategic review, the clarity on the pillars, what we're going to do and that over a 5-year horizon that we believe the execution on these things will drive accelerated profitable growth, high single digit to low double digit. And yes, we will both be measured, and we look forward to sharing details on KPIs and more specific details, as you said, in a more quantifiable way in the upcoming months at maybe JPMorgan, but that's additional work that we're continuing to do.

I think your second question was related to are we happy with the portfolio, how do we think about divestitures? I mean, again, the work that we did gives us some real excitement about the strategy and being able to implement it to drive this accelerated growth. And as part of running the company, with increased rigor and discipline, we're going to periodically review all product lines, including GeneSight to determine the ability to really support those strategic goals, right? So that's the -- we'll be approaching it.

And third, about -- thank you for viewing what we shared today as non-objectionable. I think I'll take that as an endorsement, but very good point about what does this mean and what's going to be different. Listen, there's [indiscernible] along with really focusing on high-growth market segments. Our franchise in oncology has been an important one and a good one, but it has been primarily hereditary cancer testing and HRD. It's expanding beyond that into these other high-growth applications and being able to do that by -- it's not all Myriad, through partnerships is an important change.

Another important change is our stepped up urgency, our rigor and discipline and how we're going to execute and just really make it a high-functioning, high-execution company. And those are the things, together with adding the right team that really understand the space and the domain, I think is going to be the difference for really being able to deliver on the intent of our new strategy.

Our next question comes from the line of Puneet Souda from Leerink Partners.

So obviously, GeneSight was clearly an important product, a flagship product for you, impacted here by the United coverage. I know you talked about the feedback that you expect in fall. But can you maybe talk about what has been submitted to United? Any of the early conversations giving you any leads in terms of when this can actually be resolved or not resolved? I mean, just maybe just help us understand what should we -- what should our expectations be. And just wondering any of the other commercial payers, are you getting any requests for further reconsiderations from other payers? And I have a follow-up.

Yes. Let me thank you, Puneet. I appreciate the question. I'll start, and then I'll hand it to Mark to add additional details. So again, we are happy that we've been able to, through the actions we've deliberately taken, increase the growth of GeneSight back to where we expected it to be by year-end, which is mid-single digits. And kudos to the team for the refocus, the execution, and our rev cycle team and payer markets team, which continue to really drive opportunities with new payers. And then I'd hand it off to Mark about timing and other things that you're asking. Nothing's changed on that, but I'll let Mark detail what we've shared in the past in terms of time points, what we're doing.

Again, to dispel this point, we haven't traditionally had a lot of commercial payers that we have agreements in place with. And no, we haven't experienced that. Quite to the opposite, as you heard, I think, in Scott's prepared remarks, we're actually seeing a number of new carriers that are joining. So Mark?

Yes. Thanks, Sam. So Puneet, just to give a little color to Sam's last comment, which I think we stated, right? We've had several wins across different commercial payers, mostly related to biomarker laws both in Q1 and in Q2. So we are seeing positive movement there for GeneSight, and it's across some commercial plans as well as Managed Medicaid and of course, Med Advantage plans as well. Related to United, which we also said on the call, we plan on submitting 3 publications as part of United's typical review cycle, which takes place in the fall. Two have already been published both in the Journal of Clinical Psychopharmacology. One was an economic utility study that we did with Optum. The other one is a new meta-analysis focusing on the randomized trials related to GeneSight, and a third is a sub-analysis related to the large prime care randomized trial that was done through the VA.

So we plan on submitting those in the fall. We would expect United to review those as part of the typical review process. So we would expect to hear either status quo or potentially a change in that policy. November, December time frame, which is when they usually announce, and the effective date would be the beginning of 2026.

Got it. That's very helpful. And then on MRD, could you confirm the timing of the launch has moved from first half '26 full launch to an early access launch? I wasn't clear what I heard on that, so maybe if you can clarify. And what -- we saw obviously sort of your ASCO data. Just wanted to understand, what remains to be done the validation studies? Any other studies that we should be expecting on MRD before you get into that early access phase?

Yes. I mean just -- thank you for that question. We're continuing to make good progress on our MRD clinical studies that are underway, upwards of 20 that we're working on. And by year-end, we expect to have more clinical utility work that's done and to submit for MolDX sometime in Q1, expecting MolDX, if they're with customary time lines, approval sometime towards the end of the year. We will -- however, we're making a strategic decision because we think it's important to get our test in the market, so important providers can start using it to really -- in the course of treatment of patients, we intend to do that in the first half. And so we'll be strategic and taking that out in advance, what is likely to be in advance of receiving MolDX. And because we're not going to do a broad, full commercial launch to everyone, that's why you might have heard us use the term early access, meaning focus still on quite a number we haven't determined yet of actual providers using it in the course of medical care.

Our next question comes from the line of Dan Brennan from TD Cowen.

This is Kyle on for Dan. I wanted to go back to the sort of mid- to longer-term guide here of high single digits to low double digits, not too far off from where you were before, 12% plus. But maybe can you just walk us through what the puts and takes there are across the portfolio just given that you'll be layering in some new tests with MRD, et cetera? How should we think about the different segments in the context of your guide?

Yes, maybe I'll start here. And Scott, you can add in. And Kyle, thanks for the question. And our intention is to share more details, more quantifiable numbers and KPIs, including more specifics around our growth rates over the coming months, including in the JPMorgan. But what you can tell even from the strategy, the way that we shared it, is if you look at our second pillar, which is about prenatal health and mental health, being able to grow at or above market, right, we know that the prenatal market is growing somewhere in the low to mid-single digits. And we believe we're going to be able to grow that faster based on again, the recent products we've launched and the excitement that we have for FirstGene, the new product that we have.

And GeneSight for mental health, we've already resumed growth back in the mid-single digits, and we are the market leaders there. We believe we can do that. It's really in oncology where we are seeing, again, really good growth in hereditary cancer. We have big markets here. We believe the combination of growing ourselves in the high single digits to low double digits in hereditary cancer testing, both across the combination affected/unaffected, but then when you look at these new areas, which is an important net new, right, important part that we're trying to share and the strategy is our intention through both the work we're doing, like, for example, an MRD, but through partnerships to enter into these other important segments, if you will, including IO therapy response monitoring, more on comprehensive genomic profiling. These things will -- our products that we bring to market there ourselves or through partnerships really should grow in the -- at least in the low double digits.

So it's that composite when you put it together, including prostate cancer. By the way, we're excited, again, about the partnership with PATHOMIQ and on track to launch that combined product, our first combined product in Q1. So all of these things, hopefully, Kyle, give you a little bit of color on how we can -- we have confidence to grow high single digit to low double digit. Scott, would you add -- I was pretty comprehensive there.

Yes, I don't have any more details on the financial targets at this time, but I'll just reiterate Sam's comment that we weren't necessarily intending to provide a formal and fulsome update to our LRP right now. That will come at a later date perhaps by the end of the year or the very beginning of next year.

Our next question comes from the line of [ Yuko Oku ] from Morgan Stanley.

This is [ Jason ] on for [ Yuko ]. Congratulations on the quarter. Maybe just a question on Prequel. I'm wondering how has traction for the test been since the launch in 4Q of last year? Has it been ahead of expectations or in line? And given the test differentiated 8 weeks gestation age approach, have you seen any share gains from other players in the space?

[ Jason ], thank you very much for the question. Mark, why don't you take this one on Prequel and how its traction in the interest of the 8-week gestation?

Look, I think as we've said before, we're excited about the launch, and we've seen tremendous uptake mostly because as we stated at that 8-week time frame is typically when that is the first prenatal visit. And so it fits very nicely within workflows. So we have seen an uptick. We have seen volume increase there related to the test being ordered earlier, which is great.

As far as our ability to be able to tease out the differentiation of stealing share, I think that's been a little bit more challenging. But as Sam mentioned, as we see growth there, we'll try to highlight that moving forward.

Our next question comes from the line of David Westenberg from Piper Sandler.

Congrats on the quarter. Sorry if I'm asking repeat questions. I've been hopping in between some queues here. So I just want to ask on the prenatal. You mentioned the friction from the new management ordering system. Can you quantify that impact and -- if you didn't already, and then steps to resolve it and how soon it can be resolved? And then just generally speaking, if you -- just want to make sure that when this thing kind of thing happens that it's not a switch in provider. And can you give us a comfort on that?

Yes, I'll start, and I'll hand it over to Mark. Dave, thank you for the question. I just want to clarify, be very clear, that's a redundancy there. The problem was related to an order management system. It has been addressed. So it's not like we -- we not only had a beat on it, but we have resolved it. But Mark, there's other parts of the question like -- yes.

Yes. I think the other parts of the question. So again, we have resolved it, so we don't expect it to continue at least from a system error perspective to continue into Q3. From a provider perspective, look, many of our accounts use multiple providers, and so we see shifts throughout the quarter. So I don't know if we can quantify it. I think our results this quarter and our excitement about prenatal products growing in the back half of the year pretty much reflect the way we feel about resolving the issue and about the strength of Prequel, as the previous caller asked around Prequel at 8 weeks as well as the strength in our Foresight product as well. So...

I'll just add to that. This is Scott. If you look at overall prenatal volumes, at least on a year-to-date basis, they're down about 4%. And so that is -- it's something that obviously is very different from what we normally expect in that line of business or that product category, we would expect something in the high single digits to low double digits. And so that impact you can attribute to the disruption.

Our next question comes from the line of Tycho Peterson from Jefferies.

I want to probe into the guidance raise. Obviously, you lowered last quarter, now you're raising. Maybe just for the back half of the year, how much is hereditary? Just talk about where the incremental step-up is. Also OpEx is going up. Curious about that given some of the cost-out initiatives.

And then I did want to probe on the LRP. I know you got the question earlier. But did anything change in kind of your end market growth assumptions relative to last fall?

We'll go backwards. Tycho, thank you for the question. In terms of your last question, no, nothing material. So it's not because we just -- we're benefiting from a new increase of a market or anything like that. That's not it at all. It's again about, as I answered, being able to participate in a meaningful way in other segments of Oncology or the Cancer Care Continuum, which we're not today and strengthening our own products, too, right? So those are the drivers there.

Scott, before I hand it over to you to answer a little bit more here, I'll say again that what has happened here in this quarter is we identified very clearly the challenges and the issues that were some of our biggest challenges in Q1. Again, we talked about changes we've made and the impact that it had related to GeneSight. We talked about unaffected hereditary cancer and workflow-related issues, including EMR. So we have been incredibly focused and the team has been working hard. And again, as I mentioned, I'm pleased that we've been able to execute and some of the results are exactly what we expected by the year-end. So this is not by chance or not by luck. We have done the work to make it happen, but it's been a little bit faster than we expect. But I don't know, Scott, if you want to -- there was a quantification question to hereditary cancer.

Sure. Thanks, Sam. And we don't guide at the quarterly basis nor do we guide at the individual product basis. But what we have talked about already, even on the last earnings call was around the expectation of sequential improvement throughout the year in the areas that have been adversely impacted by some of these kind of headline headwinds that we've referenced. And so when you think about the hereditary cancer testing unaffected journey that was one of the headwind items that we had flagged on our last earnings call where, as Sam was referencing, really excited about the incremental progress that we've made in accelerating volume growth in Q2, but that's not yet where we want it to be or expect it to be. And so that is one of the areas where you'd expect to see or we expect to see a further acceleration in the second half of the year. Similarly, the prenatal challenges that we're kind of newly referencing now, we certainly expect to significantly rectify in the second half of the year.

One of the other areas that we referenced on the last earnings call was the near-term headwind in terms of GeneSight volumes primarily associated with the transition in the commercial organization there. We're pretty excited to have quickly recovered the volume trajectory there, at least within striking distance of where we expect it to land longer term. But those are the areas that we expect to see improvement and to deliver the guide for the second half of the year.

Our next question comes from the line of Bill Bonello from Craig-Hallum.

I guess I have a couple of follow-up questions going back on the strategic plan. I'm just trying to wrap my arms a little bit more around the oncology strategy. I mean I think I get it, you're saying you're going to add a bunch of additional products to try and grow in that channel, and you may do that on your own, you may do that through partnership. But maybe just talk to us a little bit about sort of your right to play in that market. What is it about your position in hereditary cancer that sets you up to have success in the other areas of oncology testing and help us think about how you might compete relative to the oncology testing companies that are already out there with multiple therapy selection tests and MRD, et cetera? And I have one follow-up.

Yes. Thank you very much for the question, Bill. I appreciate it. And it's very important. Listen, what we believe we bring that's differentiating that we're going to be able to leverage include, like you said, because of our hereditary cancer leadership, being the gold standard in the market with that as well as HRD, we have a reputation. We have a lot of trust. We also have access into thousands of the most relevant health care providers and systems. We also hear loud and clear through our primary and secondary research that increasingly health care systems and providers really want to down select to just a handful of providers that can provide them the most critical test along the cancer care journey for a patient.

So it's our ability, once we're there, we know that if we're able to provide other tests that are meaningful, that are easy to use and access that we have a right, along with the fact that we have heard, and this is something that we already have strength in is being able to provide a unified report, which makes it easier to interpret from multiple tests that is to help, particularly when you're thinking about a molecular tumor board, then you have that information that accelerates decision-making. So it's those things along with adding to our portfolio and focusing in where our strength is, right? We are going to focus in, for example, on MRD where we know our ultrasensitive differentiated assay makes a difference to look at these low shedding tumors, and we're going to focus in on breast because that's one place, and we all have an established reach, reputation and trust with that community.

Our next question comes from the line of Subbu Nambi from Guggenheim Securities.

This is Ricki on for Subbu. You got a few on women's health already, but wanted to see how the ramp for SneakPeek has been going so far and it's near almost a year on the market. And if you've seen the goal about funneling patients from SneakPeek to Prequel starting to materialize yet. And then also just wanted to revisit the strategic update here in the context of women's health and mental health. Could you just provide some more color on what's new here incrementally like compared to prior comments in the last Investor Day?

Yes. Maybe I'll take this and Mark or Scott, if you want to add in, please do. But I mean listen, our SneakPeek business is one that strategic intent was really to complement, get in early on the cycle of engaging with a woman in her overall pregnancy journey. Quite honestly, it's been a challenge for us. And it's been an area that we still believe has a lot of potential, but given the areas we're focusing on, it hasn't been something we've spent a lot of time in the immediate time trying to optimize. So more on that as we have a chance to go into the next level of our own planning on our strategy.

Your second question is like what's net new? It's a great question. Again, so let me just be very clear. For prenatal health, we believe that the recently launched products, it's not just the NIPS Prequel at 8 weeks gestation age. It's also the expansion we had to our Foresight expanded carrier screening assay as well as now the early access, which we launched in June for FirstGene, which is the combined screen, right, which brings the benefit of both NIPS together with carrier screening. Those things, we believe, will allow us to differentiate and grow at or above market. And on mental health, again, it's really a focus in on being able to execute with more precision on targeted accounts and continue to drive improvement in our overall payer markets and revenue cycle activities.

One huge, huge, huge important difference from before is our absolute commitment to be deliberate in the level of resourcing focus and investment we will put into these businesses. It's going to be in a very focused, targeted way because our intention is to really focus in and grow the Cancer Care Continuum business. That's the difference.

Our next question comes from the line of Sung Ji Nam from Scotiabank.

Just will ask one in the interest of time. I was curious in terms of your expectations for above-market growth going forward. How much of it is, do you think, coming -- will come from taking share away from others, your competitors versus you guys more efficiently penetrating into the kind of the underpenetrated segments of the market? Just given that there is significant deployment of EMR and things like that across the industry, I was just kind of curious how realistic it is -- is actual share gains in a more competitive market environment.

Yes, Sung Ji Nam, thank you very much for the question. And I think the short answer is both, right? We are excited to be particularly around the Cancer Care Continuum. We are participating in large, attractive high-growth markets. So the numbers we've shared overall, the 5-year high single digit, low double digit is enabled by growing with the market there in those components. We intend to do better. So -- and that -- how we will do better is, again, the combination of our tests where we can really win an account and provide value by having really compelling tests that come together in a report that makes it easier because it is true. Over time, the differentiation of a lot of the tests are waning, not always the case, right? Again, in MRD, we believe we have a truly differentiated opportunity with the very low parts per million detection capability that we have.

And then in GeneSight, we're going to grow essentially with the market because we are the market leaders, very strong market position. Prenatal, we think we have an opportunity to grow. We absolutely do. The market is growing low to mid-single digits. We intend to do better than that once again because of those differentiated products we've launched recently and other ones we're going to do. Not to mention, Brian Donnelly has joined the team as our new Chief Commercial Officer, and a new perspective on stepped-up commercial execution that I think will complement the great work that Mark did beforehand.

Our next question comes from the line of Brandon Couillard from Wells Fargo.

Sam, at a high level, you talked about one of the increased R&D investment to support the cancer strategy. Can you do that within the current R&D investment run rate? How much is currently allocated to oncology? And how much incremental spend should we kind of anticipate there in the next few years?

Yes. Great question. Thank you for that. Like we mentioned earlier, we're not providing specifics on financials now, but we intend to be -- provide more as we -- as the months come, particularly heading into JPMorgan. But yes, to answer your question, we believe, through deliberate management of where we spend our R&D dollars, that we are -- and growing R&D, right, this is based on -- another thing you heard me say in the comments is we will grow revenue faster than operating expenses. So still being very disciplined in how we do that overall. So the P&L profile of the company continues to strengthen over this 5-year period, but we believe we can increase our investments in R&D and oncology in a meaningful way to achieve our objectives.

And again, we will get the benefit. We don't have to develop it all ourselves. Some of it will come through partnerships that enable us to get to market faster with a differential cost profile as well.

Our next question comes from the line of Michael Ryskin from Bank of America.

Great. A lot has been asked already. I just want to squeeze one more in on some of the strategic pillars you talked about. You kind of talked about strategic partnerships a little bit more for some of these newer parts of the Cancer Care Continuum. Can you just give us a couple of examples of what that could look like, both from a -- what type of partner you'd be looking for, how that would develop? I realize this is sort of really far in the future, but just theoretically, how we should think about that and what the financial profile of that might look like, that would be helpful.

Michael, thanks for the question. And hopefully, it's not so far in the future that it's a long time for now. I think the PATHOMIQ relationship that we have for being able to leverage the AI capabilities that PATHOMIQ brings together with our molecular assay for prostate cancer, Prolaris, is an example. What we're doing in at least some of the partnerships we're considering is where we call -- the R&D or the product development capabilities of a partner will be complemented by our reach into the market, our reputation, our ability to really do all the way from ordering through delivery and support.

And you can imagine that these relationships can be set up in a way where there are milestone payments and royalties to go along with it but in a way that we think that we can achieve shared objectives, in a way that's also favorable to Myriad's overall financials.

Our next question comes from the line of Mason Carrico from Stephens Inc.

Sorry if I missed this, but I did not hear any commentary around Precise Liquid. So could you give us an update on where that product stands and the launch time there? And then sorry to do this, but going back to the LRP, you guys have been making progress on RCM. You called out 49 new coverage policies or expansions year-to-date. Even qualitatively, I know you may not want to talk directly to the growth rates. But how should we be thinking about the mix of ASP gains and volume growth that's kind of built in there?

Scott, I'll let you take the second one. As it relates to Precise Liquid -- thank you for the question, by the way. We're making a strategic decision that we're likely not going to launch a Precise Liquid product that is based on the assets, if you will, that we acquired last year. Rather, we are excited about being able to serve the liquid biopsy comprehensive genomic profiling opportunity through a partnership. So those will be some of the things that we look forward to being able to share with our customers and all of you in the coming quarters. And Scott, please comment on the second question.

Yes. So in terms of the question around kind of the composition of the LRP, I think what we have communicated in the past was that we thought based on the significant no-pay opportunity that we still have, even after all of the great progress by our rev cycle and payer markets team that we thought we could continue to contribute 100 to 200 basis points per year from rev cycle and payer markets initiatives. Even with the strength that we are seeing this year, and we are very excited about it, particularly when it comes to kind of the progressive position many payers and LBMs also are taking in terms of coverage for expanded carrier screening, even with that, I don't think we'd be ready yet to move off of that longer-term expectation around 100 to 200 basis points.

At this time, I would now like to turn the conference back over to Matt Scalo for closing remarks.

All right. Thanks, Gigi, and this concludes our earnings call. A replay will be available via webcast on our website for 1 week. Thank you again for participating and have a good rest of the afternoon.

This concludes today's conference call. Thank you for participating. You may now disconnect.

All right. Good afternoon, everyone. My name is Matt Sykes, the life science tools and diagnostics analyst at Goldman Sachs, and I have the pleasure of welcoming Myriad Genetics to our conference this afternoon, Sam Raha, President and CEO; and Scott Leffler, CFO. Sam, Scott, thanks for joining me.

Pleasure to be here. Thanks for having us.

Thanks for having us.

Great. Maybe, Sam, if we just start off at a high level. I mean, look, there's challenges across the sector and -- but I do want to kind of start on a more positive note and kind of see what you're most excited about for 2025. You're obviously in a relatively new seat. So it would be great to get one, kind of what are you excited about? What are some of the goals this year? And sort of given you've been in the seat for a little while, kind of your impressions and things that you might want to accomplish.

Yes, I appreciate the question. If you don't mind, Matt, I'm going to answer that question and also maybe take the opportunity to talk about again, not just the back half of the year, but in the years to come, as I assume the role.

And part of it is, I've been doing a lot of thinking about maybe what's underappreciated about the company. So I'm going to wrap it all into one. I'll start by saying, listen, genuinely, I'm as excited today as was 18 months ago when I joined Myriad from Agilent.

And really, the excitement is about the potential to deliver on predictable, sustained profitable growth. As a starting point, I think we have some foundational points of strength that are both about what's going to happen in 2025 as much about what we're going to be able to leverage going forward. Starting with we have an established connection with over 50,000 health care providers. We're very trusted for high-quality tests that really impact medical management.

A big part of how we enable those high-quality tests is through really state-of-art lab operations for sample processing. And by the way, what we've set up allows us to turn around test results and some of the best times in the industry, along with a cost basis that gives us industry best gross margins around 70%.

You put that together with the fact that we are operating in some, I think, really meaningful attractive markets. both in terms of size, in terms of growth, oncology, for example, a cornerstone of the company, think about hereditary cancer, $6 billion market opportunity overall. This is a place where we have an opportunity to continue growing and being a leader in that space.

MRD, I'm sure we'll get around talking more about it. But we see a real opportunity to use our differentiated assay where that differentiation for sensitivity really makes a difference. Then getting a little bit more tactical about this year. Listen, what gives me a lot of confidence is we know what the challenges are. We're categorically addressing them, be it related to EMR for unaffected cancer, the challenge related to GeneSight and really focusing that on profitability and other things. And I'm really excited in the coming months based on the work that Scott and me and the rest of the team are doing to really provide clarity on the go-forward direction.

What is Myriad going to be in the coming years? And just finally, to answer your question, it's all about relentless focus on execution. That's part of something we can really step up and we are focused on starting with meeting our numbers consistently, doing what we say we're going to do, including launching products on the time lines that we say that we're going to launch them, taking any distractions away such as is there a concern around our level of financial liquidity or whatever that may be.

So driving with a sense of urgency in the now while building a really compelling strategy, which we look forward to sharing is what gives me a lot of confidence and excitement for the future.

Awesome. Thank you. So let's start with -- let's just go down through some of the challenges you had outlined just to get them out upfront. But on the EMR integrations, these integrations are critical to the diagnostic industry to drive volume growth and also customer stickiness, they're always a bit of a challenge though.

And in recent quarters, you've seen some challenges. Maybe walk us through kind of where you guys are and where have you run into problems and the time line for potentially kind of flipping those EMR integrations into a tailwind from a bit of a headwind.

Yes. Yes, I appreciate the question here, too. I mean I think that maybe we could be more clear about the specificity here. EMRs are a critical requirement increasingly so to really be able to serve health care systems and providers. And we've actually had some good success. Last year, we did 4,500 EMR integrations, a year before that 1,500. And just to be clear, as it relates to our oncology customers, our prenatal customers, we're seeing success there. We're starting to see some uplift. It's doing what we hoped that it would do. The challenge that we cited is one of the reasons we actually brought down guidance on our Q1 earnings call was related to the unaffected hereditary cancer segment.

Specifically here, what's happened is we realized -- now shame on us, we could have done better of really understanding this in more detail before we started going live is that for a lot of our health care providers, they've come back and said, listen, we like the integration of the EMR, but for hereditary cancer for unaffected meaning those that have a familial reason to be tested but don't have cancer yet, you start with a questionnaire.

And traditionally, it's been done paper. We've also imported that into portals. But when we went to the full digital EMR, that part broke, and they came back and said, it's just -- we're just going to wait. This is too much of a workaround or we have too much manual steps to actually do this in a nonintegrated way.

The good news is we know that, we've identified it. We're working on our fixed -- in place in the coming quarters is working with Epic to actually have an integrated Mygene history, which is our version of this survey. There's a couple of other workflow elements, too, related to sample collection kits and some other things. But what I want to leave you with is we understand the specifics, we're working on them, and we are confident that we're going to be able to address them. And over time, as we head into the last part of this year and then go into next year, this is going to turn into a big guide guy for us.

Maybe...

Maybe you want to -- Scott?

Well, I think that captured really well some of the technical challenges and the opportunity to flip that headwind into a tailwind. The other element, where I think there's a lot of opportunity that we have a more clear line of sight to is around just focus of the commercial organization and allowing our sellers to sell.

And one of the nuances to our commercial organization is that historically, they've been a very high-touch commercial team not just in terms of selling but also in terms of providing support for the providers that they call on in the EMR ramp-up situation, they are being distracted from the art of selling to have to focus more and more on the support during that ramp-up period. And we are staffing more aggressively now some of the technical/commercial support folks that are able to provide dedicated support to providers that are kind of mid-ramp up on EMR, which then gives our commercial organization the freedom to focus on the selling side where they had some distractions previously.

Got it. Maybe shifting over to GeneSight. It seems like there's kind of 2 pieces of this. There's obviously the UnitedHealthcare coverage decision as well as the impact that we saw from Q1 from the reallocation of commercial resources. Maybe starting with the UNH coverage decision. Can you kind of give us an update on the additional evidence you're generating? And any conversations you're having with UNH around reversing that decision or any progress that's being made on that?

Yes. I mean, first of all, we're on plan. I mean, I think what we've said publicly in the past is that our plan to submit new pieces of data to UnitedHealth for their consideration. We're on track for that. We'll be doing that this summer. We have an ongoing set of dialogue with them. I want to be just very clear, though, Matt, from our perspective and what's factored into our projections, our numbers is not a change or a reversal of their policy decisions. So there's nothing that we've heard or seen that would give us any encouragement or reason that it could change.

Not saying that it couldn't, but just to be clear to set expectations related to that. The other part of the challenge that we had, particularly in Q1, I think we made the right decisions, understanding the nature of the financial impact from the UnitedHealth policy decision. And we reduced some of our selling staff.

We redirected some of our marketing spend and so forth. The right things to do, but tactically within the quarter, the timing of that, the reassignment of territories and all that, that had an effect. We feel like we're in a good place.

And very importantly, we are focused on predictable, profitable growth. And it has changed from before what we were thinking would have been high single-digit growth now to low to mid-single-digit growth. But that business is doing what we expect it to do at this point.

Got it.

Maybe one other element just to emphasize on the GeneSight side is that when the United development was first publicized, there was a lot of concerned inquiry from investors that were concerned that there might be some kind of a spillover in terms of loss coverage for other payers across the landscape. And we're really pleased that so far now, here we are over 6 months later, we have not lost a single -- not a single other instance of coverage loss. And in fact, we are accumulating an increasing list of new coverage wins so far this year, including on the commercial side.

And so unfortunately, none of them carry the same dollar weight that United does, but it's very encouraging to see these multiple instances accumulating. And it's just a reminder that United may be big, but there's still just one opinion, and there are more and more opinions that are more favorable working in our direction.

Got it. And maybe sticking to the commercial strategy. You also talked about adding additional commercial intensity behind Prolaris. And maybe talk more about the strategy there and when we might start seeing the benefits of that increased commercial intensity and resource allocation.

Yes. I mean we -- I think we're already starting to see some positive traction. Coming into the year, we did a number of things, specifically around prostate cancer and Prolaris. We added some new staff. We added a new sales manager. We also trained our sales team with new messaging and supported by KOLs who could provide a broader different perspective that Simon Level 1 criteria isn't the end all be all.

So we're seeing the combination of that, along with now that we have announced the partnership with PATHOMIQ, which will give us the AI component to complement our molecular assay for Prolaris.

We're seeing a little bit of change in the marketplace. There's a perception that we're going to be here. I think our competitor had done a really nice job of saying, "Hey, is Myriad even really, really interested in long-term prostate cancer. So we've been able to see that.

Listen, we know that while we're on track for, and I can tell you more about that, launching our paired test, if you will, will be a single test including the AI capability at the end of this year, we're already seeing the fact that we are holding steady. Our volumes are steady. It's not a decline. It's not -- we're not continuing to lose a lot of share in that space. I mean, Scott, would you add anything to that one?

No, no, [indiscernible]

Maybe let's drill down into [indiscernible] technology and what that does and what are sort of some of the key features that clinicians might see from that partnership and that sort of increased capabilities.

Yes. Well, just a little bit on the background. So what PATHOMIQ is, what they've done based on deep expertise in prostate cancer, a lot of relationships, a lot of clinical data around prostate cancer. They've developed an algorithm, which is really based on looking at a stained, H&E stain slide and then using the morphology of that to be able to make predictions on the stage or the advancement of cancer.

Starting with prostate cancer. And by the way, this is an opportunity for us then to leverage this in breast and other cancer types as well. The first test that will be coming to market at the end of this year, at least as early access will be where -- when a provider orders this combined test, if you will, it's actually from a single tissue sample where part of it will go for the molecular test as it's done today. And the other part will be put on to slides and stains and imaged using the algorithm. And what they will get back is a single report. And the report will essentially be enhanced opportunity with the PATHOMIQ piece is to have even more precision on -- this is at the time of biopsy, which is about 800,000 patients a year to determine the level of risk, low, medium, high, with a higher level of confidence ratio. So that's what it does immediately.

And in future, in 2026, we'll be bringing to market tests for post-radical prostatectomy or postradiation, which, by the way, is a complete blue ocean for us. We don't -- that's not where we engage today. That's been all the ecipher and Veracyte. So we're excited about that opportunity.

And for those tests, it will actually be a comprehensive singular readout altogether. So that's taking us a little while to do, even though you're getting the benefit. So it will be an even more integrated report.

Got it.

If you will.

And then Scott, just on the updated guidance in the first quarter, you included a moderated OpEx spending number. And while you're going to keep strategic investments intact. Maybe talk a little bit more about where you're finding those savings and if there are more structural cost takeouts or costs that may have to be added back once you kind of return back to growth?

Sure. And I guess I would start out by saying that the most important part of our OpEx strategy now is to make sure that we're able to fund the investments that we deem to be most critical in terms of long-term strategic growth. And so when you think about things like in the short and medium term like EMR and so on, like we discussed a few minutes ago or over the longer term, MRD and PATHOMIQ and things like that. We absolutely intend to prioritize that from an OpEx investment standpoint, and what it gives us the opportunity to do then is to go back.

And we obviously -- we have a very large OpEx base to work with and look at discretionary spend in other parts of the organization in order to deprioritize in those areas to fund the ones that we know are more important and more strategic over the longer term.

Got it. And you've talked about in terms of the strategic investments, EMR integrations, commercial focus on Prolaris, which you already addressed. Are there any other investments you kind of see as key to catalyzing growth either for you or Sam?

I mean I think that 3 things that I would give you on that, Matt. One is, I think we have an opportunity to continue really strengthening and building on our commercial capabilities. I think market reach and being able to get to more providers and more health care systems is an opportunity for us. And I think that so long as the business case holds that with the addition of every individual will get a return. I think that's something we're very seriously looking at.

Another very important part of our journey going forward at Myriad is recognizing not everything has to be fully developed and commercialized by Myriad, that there will be opportunities in the market that we'll be able to better address through a partnership, either be it because they bring a component, be it from the science or the development of a product to something else that would complement us and allow us to go to market quicker.

So investments in those partnerships to really make those successful. PATHOMIQ being the first example of that is another area. And then without a doubt, well, where you said MRD, let me say MRD again. That is such an important driver, I think, of what will really help accelerate our growth.

Got it. And just kind of getting at more of the initiatives on the commercial side, what are you kind of doing to implement to get increased productivity of the existing sales force? I mean you talked about how there's a lot of one-to-one interaction, personal action with sales. I mean, we keep hearing about digital initiatives and things like that. Maybe talk a little bit about how you're looking to enhance the productivity of the sales force.

Yes. Well, there's, again, multiple fronts to what we're doing. One is it starts with how do you direct your sales team to be efficient and effective. And that means doing the work in the background with our sales support team, sales ops team, to really understand the profile of a customer and where they should be spending their time.

So putting that into Salesforce, that's our CRM that we use to really help them be even more focused on every moment of time where should they be spending time. That's one thing. Another very important thing we've been doing is really helping train our sales team to be more effective in selling.

For example, a very big part of our future is being able to serve the fuller cancer care continuum. So educating our sales organization to be effective in not only selling hereditary cancer, but the molecular profiling tests, be it our comprehensive genomic profiling test, precise tumor, HRD with My choice all the way in preparation for MRD. That's another thing.

And the third very tactical thing I'd give you is compensation scheme, commission scheme makes a difference. So volume growth is important, but doing it in a way that incents focus on the places where we are likely to get paid to drive profitability, along with growth is a third piece to that.

Yes. Okay. I mean -- and let's shift to MRD. You presented some data at ASCO. Maybe talk a little bit about the progress you're seeing with Precise MRD. And also confirm kind of that we're -- we still should be thinking about a launch in the first half of '26?

Yes. So it's been an exciting eventful related precise MRD starting at AACR. We had a collaborator from MD Anderson, share some data related to renal cancer. And what that showed was clinical validity, the ability for our MRD test to -- this was a retrospective. So you have a lot of time points of data already there.

Our ability to detect several -- what would be several months ahead of conventional -- radiology conventions being able to detect. I think the buzz most recently is around ASCO. Just a couple of weeks ago, we had both collaborator at MSK on breast cancer and then at the hospital cancer East from Japan, a major collaborator working with us on a study called MONSTER, which is going to include more than 1,200 patients.

This was the first readout on over 100 patients, and this is across 8 breast cancer types. And when it showed -- and this is a prospective study with longitudinal. By the way, this is the set of collaborators that did a lot of the landmark initial work with Natera and Signatera. So also, they picked us because of the sensitivity of our assay.

And what they were able to show in the data, which has given a lot of buzz is that for a number of cancers in this more than -- I said 8, but it's really more than a dozen cancers that are part of this trial set that they were able to show that for low-shedding tumors, including breast, ovarian, prostate, that the sensitivity of our AFE allowed the detection of cancers several months before the conventional means and with more than 95% confidence in being able to detect that accurately.

So once again, the message from that is for certain cancers, and this is not colorectal and lung, but we're talking about breast, prostate, ovarian, it makes a difference, and that's where our detection capability is really going to be important in medical practice.

And just given the ultrasensitive approach you have, how is that informing your strategy of which indications to pursue first? I mean you kind of just gave a hint of it. But I mean, you had this great slide at your Investor Day that showed sort of the low shedding cancers and the number of sites that you can actually identify.

And it showed that the whole genome and your ultrasensitive approach was really differentiated with those specific cancers. Is that going to inform how you go to market in terms of the indications?

100%, Matt. And it's not coincidence, right? We believe that what will allow us even being a late entrant into MRD to have success and have traction in the market, it's a combination of, one, our technology, that sensitivity applied to those cancers where it matters, where -- without it, you just -- you can't detect.

So again, I've just stated those breast, prostate, ovarian, renal and others. Two, those are the cancer places where we have established franchises, if you will. We have relationships with not only oncologists, with surgeons, the broader network of nurses and the cancer care continuum, if you will.

And third, what we've found both through secondary research, primary research, reaffirmed again this past couple of weeks at ASCO is when you think about how cancer care happens, particularly for advanced stage cancers, you have often the need for these molecular tumor boards, who come together, multiple disciplinary doctors really trying to determine based on as much information they have, what is the best course of treatment for a patient.

And one of the things that really facilitates and makes them more effective is to have a combined test report. So our ability to combine information where it's relevant, hereditary cancer together with therapy selection with MRD for these cancers where we have a place, a reputation and our sensitivity matters, that's the play. And that's why we believe even though we're a little late to the market, we're going to be able to have traction.

Got it. And then, Sam, shifting more towards sort of longer term. You mentioned on the first quarter call that you feel confident in the high single to low double-digit LRP growth. What do you see as sort of the main drivers of that growth? And how long could it take to get there?

Yes. Well, listen, I mean I know we shared a slide and a perspective at the October Investor Day. But I'd just give it to you fresh this way. As a baseline, when we look at hereditary cancer, and this is across once again, unaffected and affected in totality, that's a market segment that's growing mid-single digit to -- according to some reports, high single digits.

We are the leaders in the space, and we have every right to grow at that rate, and we are investing in programs such as breast cancer risk assessment and other things to activate, there's still less than 15% penetrated $4.5 billion part of that, right? So one, I'll start with the foundation of that segment growing for us mid-single digits into high single-digit growth.

If you stay within cancer molecular profiling, which is the combination for us of Prolaris, HRD, comprehensive genomic profiling for therapy selection. Not only what we have today, this is a 3- to 5-year view with the things that we intend to add through partnership or other. That's an area that we believe we can grow high single digit to low double digit, even growing with the market.

Then when you look at MRD, clearly, we're going to start from 0, but that is going to be without -- we have high confidence that should grow double digits even if we're staying with markets, right? Then the question is how much high double digits. You put that together then with prenatal, in our prenatal franchise. We've already seen based on the launch of a new NIPS assay, which allows earlier at 8-week gestational age that assay having traction FirstGene, which we -- as a combined carrier screening, NIPS assay, we recently launched. Based on all this, even if the market is growing mid-single digit, we see a path to growing at least that as we have for the last several quarters.

And then GeneSight, right now GeneSight, that's part where it's changed, and that was a core narrative of being able to grow with conviction at double digit. Now that GeneSight, we've adjusted that from high single digit, low double digit, what it was, down to low to mid-single digit. But you put that all together in the math, and we have conviction of our ability to grow high single digit.

Over time, we'll see if we can put forward the case and if it makes sense for anything beyond that. But the confidence in the high single digit is there.

Got it. And then, Scott, just shifting over to ASPs for a minute. You had some headwind from GeneSight and prior period collection step down in Q1. But if you look at the elsewhere in the portfolio, you had actually a pretty strong ASP performance. So how are you thinking about the pricing outlook for the remainder of the year, if you put all those things kind of in the blender?

Yes. We remain very encouraged. And as I know you recall throughout all of last year, we were very vocal about what we saw as kind of a maturing and increasingly favorable ASP landscape perhaps partly influenced by the maturation in the competitive landscape around us as well.

But across our product portfolio outside of the one kind of unique instance of the United coverage of GeneSight, we were really encouraged with the favorable progress throughout 2024, and that momentum carried into 2025. And as we talked about on our last earnings call, we continue to see strength and stability in the underlying organic rates across the rest of the portfolio, again, outside of United coverage at GeneSight.

And as we all know, there is still ample opportunity in terms of NPAs that we continue to go after and hopefully create some forward progress that can help towards that high single-digit to low double-digit revenue trajectory that Sam was talking about.

Got it. And just on a cost per test, which we haven't kind of discussed in a while, but maybe update us on the potential for improvement on a cost per test basis now that you've, I believe, largely completed a lot of your lab of the future integrations.

Yes. So as Sam mentioned, I think at the very beginning of the discussion, industry-leading 70% gross margin. And so our starting point is a pretty strong one. And you can see the operating leverage that we have as a business, just if nothing else from that gross margin profile. But there is more operating leverage to be had.

And as we continue to advance and grow from a volume standpoint, then that we expect that to be accretive to the margin profile for those products. And then to your point, we have not yet really seen the benefits of the lab of the future transformation. You're talking about an overall program over a multiyear cycle. That was almost $100 million in total investment that's largely complete now.

And it really is more in the next couple of years that we expect to realize the P&L benefits and operating benefits of that, which includes an increasing emphasis on automation and optimized workflows and so on. And so it creates, if nothing else, a margin cushion for us and margin upside opportunity within those product lines, obviously, as we bring new products in that are part of the pipeline that are going to be so such an exciting part of our revenue base in the years to come.

During the initial ramp up, new products are typically going to be more dilutive to the margin profile, but that increasing margin accretion from the core legacy product categories will position us well for an overall strong margin profile.

And you've kind of guided to expecting to hold around 6% to 9% at the midpoint of guidance for this year on gross margin. You talked a little bit about some of the upside levers to that gross margin. In the near term, is it safe to say you feel pretty confident about being able to protect the margins where they are today, just given the slower growth that you're experiencing this year?

Yes. Overall, certainly in terms of kind of the underlying health of the portfolio and operating efficiency, we feel really good about the performance and the execution. There's a certain amount of variability in our margin profile that comes from how you're performing from an ASP standpoint because that as your ASP moves up and down, then that really is moving at 100% contribution margin.

And so that can create in the shorter term, some amount of variability, again, both upside or downside. That's not reflective of any kind of sustained change in the operating environment, and we feel great about the overall outlook for margin profile and just the overall efficiency and execution of the team.

Got it. Any questions from the audience at this point?

Basic nontechnical question. MRD testing, is that just a recurrence test? Or can that be used as ultimately via screening for something for people that haven't yet been diagnosed with?

It's a great question. I mean -- well, first of all, there are a number of indications for MRD, along with recurrence, I think, an exciting opportunity is also for therapy deescalation to even determine if going through a particular course of treatment will help or not, okay?

But to answer your question directly, what we found in the realm of science is that, that same sensitivity that you use to detect the recurrence of cancer at very early stage could potentially be used for other things, including potentially even in the selection of therapy like comprehensive genomic profiling is done.

And some companies have also thought about the fundamental MRD assays being very similar to what could be used much earlier on in screening like MSA. That's not necessarily an area that we're interested in, but I'm just answering your question.

So the other question I have, again, nontechnical is when UNH says we don't want to pay for it, the investor says, well, the benefits are not obvious or they're subject to debate. Company has been around for a long time now. Why haven't you built a more comprehensive database to clearly demonstrate the utility of these hereditary tests?

Yes, it's a great question. And just to distinguish, whereas we have, I think, a very comprehensive set of clinical utility, clinical value dossier and supporting facts for all of our other tests, it has proven to be uniquely difficult for mental health. That is actually not based on hereditary. It's actually based on the body's ability to metabolize, it's a pharmacogenomic test.

And though there are a number of papers related to clinical evidence, the most difficult aspect that we've had or anyone in this space, Myriad or otherwise, though we've been the clear leaders in mental health is the value, the health economic value of being able to reduce the time to selecting the right medication for a patient by 3 to 6 months versus that we're going to get there, but it's -- okay, so what, you save 3 months.

And we've just not being able -- we have not been able to sufficiently compel UnitedHealth on that point.

So just the last comment, though, if there's compelling utility or obviousness to the rest of the portfolio, you kind of have to really share that with your investors because these tests are not going to go away if the clinicians truly believe in that.

The only risk is other tests or competitive pricing dynamics. But where the stock is priced today suggests that there's more risk through the portfolio and less opportunity. So...

I couldn't agree with you more, and thank you for being here and pointing that out. I mean that is what gives me a lot of conviction that given a series of things that have happened starting in November with UnitedHealth, in many ways, we have been devalued to the point of not even being 1x our multiple of our revenue.

And as I said, these are attractive markets. We have leading positions in many of them. And these are tests that are established and being reimbursed. And they're growing markets where we have the right to win and grow on. So you're absolutely right. We need to...

But do you share the clinical benefits with your investors as to the economics behind these wide -- why there's not going to be a commoditization on the reimbursement side and ongoing clinical utility cost benefit.

Again, look, I used to be an investor in the company when Peter Meld years ago. So I'm not that familiar right now. But the risk was always -- you're a risk tool. So it's always kind of vague as to the benefit. It's not -- it was never clear and compelling what the values are. But now you have much more data.

We do. And we do -- and we're well beyond just the hereditary risk part. So I appreciate the input.

Just as we kind of close here, you've got a couple of launches coming out. FirstGene, MyRisk expanded panel. But what I want to talk about that showed some really good traction in Q1 was the prequel early gestational age. And has that kind of performance continued in the second quarter? And should we expect that to be a driver in the back half? Maybe talk a little bit about that test and sort of the differentiation that you have given that gestational age?

Yes. So the key differentiation here is we are able to detect with a high level of accuracy at the 8-week time point rather than 10 or 11 weeks that is conventional in the market. And that's important because 8 weeks is the natural time point where a mother comes back to get a battery of tests, other clinical tests and blood draws anyway. So that makes a difference.

We found it to be not only of interest to providers. It's also open doors for us to get back in and have something to talk about for new customers. So yes, in short, Matt, it's seeing good traction and interest, and we think that will be one important part. Now we're going to have FirstGene. So we're going to have a series of opportunities to go in and have new conversations. The performance of the test are undisputably among the best in the market.

Awesome. We're out of time, unfortunately. Sam, Scott, thank you very much. Appreciate it.

Appreciate it. Thank you, Matt. Yes.