Castle Biosciences, Inc. · NASDAQ:CSTL
Castle Biosciences — Investor Day (September 2022)
110 slides from Castle Biosciences's investor day presentation, Sep 20, 2022
Slide 1: Investor Day
Investor Day September 20, 2022
Slide 2: Patient Testimonial
Patient Testimonial C/STLE BIOSCIENCES
Slide 3: Disclaimers
Disclaimers Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are subject to the “safe harbor” created by those sectio
Slide 4: Agenda
Agenda All times Eastern 4:00-4:05pm DecisionDx-Melanoma Patient Testimonial 4:05-4:10pm Frank Stokes, Chief Financial Officer 4:10-4:30pm Derek Maetzold, Founder, President & Chief Executive Officer 4:30-5:00pm Brent Moody, M.D., F.A.C.P., F.A.A.D., Skin Cancer Surgery Center, Nashville, TN 5:00-5:
Slide 5: Derek Maetzold
CASTLE BIOSCIENCES
Slide 6: Mission Vision Values
Mission Vision Values Improving health To transform disease ExCIITE: Excitement, through innovative management by keeping Collaboration, tests that guide people first: patients, Integrity, Innovation, patient care clinicians, employees Trust and Excellence and investors 6
Slide 7: Castle Is Focused on Improving Health through Innovative Tests That Guide Patient Care
Castle Is Focused on Improving Health through Innovative Tests That Guide Patient Care Dermatology Uveal Melanoma Gastroenterology Mental Health Portfolio of innovative tests designed to guide patient care 7
Slide 8: Castle Is Focused on Improving Health through Innovative Tests That Guide Patient Care
Castle Is Focused on Improving Health through Innovative Tests That Guide Patient Care Three strategic guideposts that create value for customers, patients and stockholders Customer and Solution Centric Continuous Evolution and Improvement Exceptional Employees 8
Slide 9: Consistent Execution Furthers Our Leading Position in Dermatology and the Dx Spaces
Consistent Execution Furthers Our Leading Position in Dermatology and the Dx Spaces Exceptional Continuous Evolution Customer and Employees and Improvement Solution Centric • Leadership development for all people leaders • Evolution of 31-GEP → i31-GEP • More value for clinicians (multiple tests in
Slide 10: Answering Clinical Questions to Guide Care along the Patient Journey
Answering Clinical Questions to Guide Care along the Patient Journey Our focus is on diagnostic, risk stratification and therapy response areas of the patient care continuum Inflammatory Skin Dermatology Disease Pipeline Test Uveal Melanoma Gastroenterology Mental Health MRD/Recurrence PATIENT CARE
Slide 11: Estimated ~$8B U.S. Total Addressable Market for Commercially Available Tests
Estimated ~$8B U.S. Total Addressable Market1 for Commercially Available Tests Dermatology Gastroenterology Mental Health Cutaneous melanoma/ Cutaneous squamous cell Suspicious pigmented Barrett’s esophagus/risk of progression to risk of metastasis, SLNB Mental health therapy response carcinoma/risk
Slide 12: Dermatology Playbook
Target Dermatologists, Surgeons, Dermatopathologists Target Market Evidentiary Development Dermatology Evidentiary Commercial Development Team Expansion Playbook Differentiation and Innovation Commercial Expansion 2023 and Beyond Guidelines and Reimbursement Digital Marketing Digital Marketing 12
Slide 13: GI Playbook
Commercial Team Expansion Drive Awareness Through Refined Messaging GI Playbook GI Outreach and Education 2023 and Beyond Target Accounts Include Community Practice and Academic Medical Centers Digital Marketing 13
Slide 14: Mental Health Playbook
Strengthen Leadership Team and Refresh Field Training Mental Focus on Older Population Who Benefit Most from Unique Feature of Drug-Drug Interactions Health Expand Publications from Strong RCT Data to Continue Differentiation from Competitors Playbook Target Psychiatry Practices, Other High Prescrib
Slide 15: TissueCypher Acquisition Expected to Contribute Materially to Revenue in 2024 and Beyond
TissueCypher Acquisition Expected to Contribute Materially to Revenue in 2024 and Beyond Significant milestones of integration plan achieved ahead of schedule Q2 2022 Q3 2022 Laboratory expansion efforts AGA Clinical Practice Update underway, including investments in released with best practice Q2 2
Slide 16: IDgenetix Acquisition Expected to Contribute Materially to Revenue in 2024 and Beyond
IDgenetix Acquisition Expected to Contribute Materially to Revenue in 2024 and Beyond Integration plans on track with significant milestones already achieved Q2-Q3 2022 Q2-Q3 2022 Integration of internal Sales training to align functions (e.g., December 2021 April 2022 mental health commercial Marke
Slide 17: Brent Moody, M.D., F.A.C.P., F.A.A.D.
Brent Moody, M.D., F.A.C.P., F.A.A.D. Skin Cancer Surgery Center, Nashville, TN
Slide 18: DecisionDx-Melanoma
C/ASTLE BIOSCIENCES Decision Dx > Melanoma
Slide 19: About Melanoma
About Melanoma Skin cancer is the most common of all cancers Melanoma accounts for less than 1% of skin cancers and is the second most frequent cause of skin cancer deaths Basal Cell 8/10 Melanoma is the 5th most commonly diagnosed cancer Squamous Cell 2/10 Melanoma, Merkel cell carcinoma, Kaposi sa
Slide 20: DecisionDx-Melanoma Provides Answers for Two Critical Clinical Questions
DecisionDx-Melanoma Provides Answers for Two Critical Clinical Questions Individual Breslow Risk of Thickness Sentinel Ulceration Mitotic Rate Lymph Age Node Positivity DecisionDx- Melanoma Neural network Class Result with AI algorithm Breslow Thickness Individual Ulceration Risk of Mitotic Rate Rec
Slide 21: Staging and Prognosis Why?
We stage tumors in an effort to: Staging and Predict biologic behavior (recurrence, metastasis, death) Prognosis Determine appropriate treatment and follow up Why? ALTER outcome by treating early to reduce likelihood of death 21
Slide 22: Melanoma Staging Gaps
Melanoma Staging Gaps 1. Too many deaths from the Stage I group 2. Stage IIB and IIC patients do worse than Stage IIIA patients Can we do better? Time to update our thinking? 1804 1820 1823 1844 1892 Rene Laenec William Norris Robert Carswell Samuel Cooper Herbert Snow The first to distinguish The f
Slide 23: Staging and Prognosis – Past
Staging and Prognosis – Past Dr. Wallace Clark (1924-1997) USA “Clark’s Level” 1969: Used in older versions of AJCC staging “It has been quite difficult to explain this apparent striking discrepancy in survival rates of malignant melanoma” 23
Slide 24: Can We Do Better? Dr. Breslow Thought So 1970…
Can We Do Better? Dr. Breslow Thought So 1970… “Cutaneous melanoma is a most unpredictable lesion" 24
Slide 25: Staging and Prognosis – Past
Staging and Prognosis – Past Dr. Charles Balch (MD Anderson) Ulceration 1980 25
Slide 26: Staging and Prognosis – Present
Staging and Prognosis – Present AJCC 8: • Breslow Thickness paper published in 1970 (meaningfully integrated into staging in 1983) • Ulceration – 1980 described (added to staging in 2001) • Lymph node status • Distant metastasis Factors used in prior staging systems: mitotic rate, level of invasion,
Slide 27: Staging and Prognosis – Future
Staging and Prognosis – Future • Current melanoma staging relies upon factors that are 40 years old (ulceration) and 50 years old (Breslow thickness) • These are STILL CRITICALLY IMPORTANT Key Questions: • What explains variation in outcome within a stage (intra-stage variability)? • Why do some ear
Slide 28: Staging and Prognosis – Future
Staging and Prognosis – Future • Adding gene expression profiling (GEP) to traditional risk factors to better risk stratify patients, to better predict biologic behavior of the tumor • In other cancer types, GEP is standard practice: • Uveal melanoma • Breast cancer • Gaining traction in prostate ca
Slide 29: Traditional Approaches to Staging Miss Patients with Aggressive Tumor Biology
Traditional Approaches to Staging Miss Patients with Aggressive Tumor Biology However, more than half of the deaths caused by melanoma (excluding Stage IV) occur in patients who were originally diagnosed as lower risk (Stage I or II) AJCC staging, based on clinicopathologic features, alone is inadeq
Slide 30: DecisionDx-Melanoma GEP Has Consistent and Independent Evidence of Prognostic Value across Studies
DecisionDx-Melanoma GEP Has Consistent and Independent Evidence of Prognostic Value across Studies 100 RFS HR RFS (95% CI) HR DMFS (95% CI) FEATURE p-value p-value 80 % Recurrence Free Breslow thickness (per mm) 1.12 (1.03-1.22), p=0.01 1.14 (1.02-1.26), p=0.02 60 40 Ulceration 1.63 (1.18-2.25), p=0
Slide 31: Collaboration with the National Cancer Institute
Collaboration with the National Cancer Institute Linking DecisionDx-Melanoma clinical testing with patients captured in the NCI-SEER Registry
Slide 32: NCI/SEER Data Linked with DecisionDx-Melanoma Test Results
NCI/SEER Data Linked with DecisionDx-Melanoma Test Results Data analysis of a cohort of real-world, unselected, prospectively tested patients with cutaneous melanoma 3-year OS (95% CI) Deaths, % (n/N) 31-GEP Tested 93.1% (92.0-94.2%) 4.8% (174/3,621) Benefit in Overall Survival (OS) in 21% patients
Slide 33: Patients with Melanoma Desire Testing with DecisionDx-Melanoma
Patients with Melanoma Desire Testing with DecisionDx-Melanoma 90% 92% 77% 54% Wanted prognostic Wanted testing to obtain all Of the patients who did not receive information about their Felt the testing was useful of the information they could 31-GEP testing, 54% wished they melanoma tumors at diagn
Slide 34: DecisionDx-SCC
C/ASTLE BIOSCIENCES Decision Dx »SCC
Slide 35: Cutaneous Squamous Cell Carcinoma Is an Emerging Problem in the U.S.
Cutaneous Squamous Cell Carcinoma Is an Emerging Problem in the U.S. • Managing SCC is a significant clinical issue as deaths from SCC are now estimated to exceed those from melanoma DEATHS PER YEAR IN THE U.S. • Because cancer treatment plans and their outcomes are guided by ~7,650 risk for metasta
Slide 36: How is Risk Assessment Traditionally Done for SCC Patients?
How is Risk Assessment Traditionally Done for SCC Patients? The SCC community uses the term >2 cm3, “high-risk” SCC to describe different patient populations Deep3 (broad definition), BWH4 T2a BWH4 T2b Any 1 of: Any 2-3 of: PNI3 (broad def’), NCCN1 HR >2 cm, >2 cm, Poorly or differentiated3, Deep (>
Slide 37: Current SCC Staging Options
Current SCC Staging Options • AJCC (American Joint Commission on Cancer) • BWH (Brigham and Women’s Hospital) • NCCN (National Comprehensive Cancer Network) • Gut Instinct 37
Slide 38: Staging Systems – Let's Dig a Little Deeper
Staging Systems – Let’s Dig a Little Deeper 38
Slide 39: Staging Systems – AJCC
Staging Systems — AJCC Table 1. Definitions for T, N, M T4a T4b Primary Tumor Primary tumor cannot be assessed Carcinoma in situ Tumor smaller than or equal to 2 cm in greatest dimension Tumor larger than 2 cm, but smaller than or equal to 4 cm in greatest dimension Tumor larger than 4 cm in maximum
Slide 40: AJCC Performance
AJCC Performance Problem number 2 Problem number 1 JAMA Dermatol. 2019;155(7):819-825 40
Slide 41: Brigham and Women's Hospital System
Brigham and Women’s Hospital System 41
Slide 42: BWH Performance
BWH Performance Still a Problem Better than AJCC JAMA Dermatol. 2019;155(7):819-825 42
Slide 43: NCCN Guidelines
Decision Dx *SCC NCCN Guidelines Nati | . . . a Comprehensive NCCN Guidelines Version 2.2022 NCCN Guidelines Index Buoy Farce Squamous Cell Skin Cancer Table ont STRATIFICATION TO DETERMINE TREATMENT OPTIONS AND FOLLOW-UP FOR LOCAL CSCC BASED ON RISK FACTORS FOR LOCAL RECURRENCE, METASTASES, OR DEAT
Slide 44: SCC Staging Challenges
SCC Staging Challenges Possible Solutions • Clinically observe everybody (undertreat to avoid excess therapy) • Treat everybody (overtreat) • Refine our prognostic ability 44
Slide 45: DecisionDx-SCC Clinical Validity
DecisionDx-SCC Clinical Validity • DecisionDx-SCC (40-GEP) predicts metastatic risk for SCC patients with one or more risk factors • DecisionDx-SCC accurately classifies patients as low, moderate or high biological risk (Class 1, Class 2A, Class 2B) • DecisionDx-SCC is supported by 11 peer-reviewed
Slide 46: DecisionDx-SCC Clinical Utility
DecisionDx-SCC Clinical Utility • DecisionDx-SCC has published clinical utility and clinical impact studies with over 600 clinicians and 300 patients • Risk-aligned management changes include frequency of clinical visits/follow-up, baseline and surveillance nodal imaging decisions, referrals and sen
Slide 47: DecisionDx-SCC Real-World Use
DecisionDx-SCC Real-World Use • Real-world use data indicates that DecisionDx-SCC is being ordered for the intended use population; high-risk SCC patients with one or more risk factors • In the first year of clinical testing, >75% of patients tested had two or more high risk factors with an average
Slide 48: DecisionDx-SCC Impacts Management Planning by Real-World Test Users
DecisionDx-SCC Impacts Management Planning by Real-World Test Users for Real-World Patients Class 1 Real-World Case #2 100 Class 2A Class 2B Management Change (Percent of Clinicians) Age: 69 Sex: Female 80 Location: R inferior postauricular skin Subtype: Infiltrating Differentiation: Moderate Additi
Slide 49: Matthew Goldberg, M.D., F.A.A.D.
Matthew Goldberg, M.D., F.A.A.D. Inflammatory Skin Disease Pipeline Program
Slide 50: Unmet Need in Patients with a Difficult-to-Diagnose Pigmented Lesion
Unmet Need in Patients with a Difficult-to-Diagnose Pigmented Lesion The Clinical Problem These difficult-to-diagnose Of the estimated two million lesions are commonly sent Diagnostic ambiguity can suspicious pigmented lesions for second opinions to lead to clinical management A clinical hurdle for
Slide 51: MyPath Melanoma and DiffDx-Melanoma Are Validated to Classify Ambiguous Melanocytic Lesions
MyPath Melanoma and DiffDx-Melanoma Are Validated to Classify Ambiguous Melanocytic Lesions as Suggestive of Benign or Suggestive of Malignant Benign Benign Melanocytic Lesion of Intermediate Intermediate Uncertain Potential Malignant Malignant MyPath Melanoma DiffDx-Melanoma • Quantifies expression
Slide 52: Diagnostic GEP is Designed to Provide Clinically Actionable, Objective Results
Diagnostic GEP is Designed to Provide Clinically Actionable, Objective Results for Nearly All Patients Benign Benign Intermediate or Intermediate or Technical Failure Technical Failure (22.2%) (1.3%) Malignant Malignant >98% By leveraging our second GEP test, >98% of patients with ambiguous melanocy
Slide 53: Diagnostic GEP Has Clinical Utility for Dermatopathologists and Dermatologists
Diagnostic GEP Has Clinical Utility for Dermatopathologists and Dermatologists Reduced rate of No adverse events for patients with Fewer re-excisions in benign indeterminate diagnoses by benign GEP results and no surgical lesions by dermatologists2 dermatopathologist1 intervention4 Multiple peer-rev
Slide 54: Case Study: High Clinical Suspicion for Melanoma
Case Study: High Clinical Suspicion for Melanoma By leveraging a second GEP test, >99% of patients with ambiguous >99% melanocytic lesions will receive a clinically actionable result.1 Case contributed by: Dermatologist, Portland, OR 54
Slide 55: Case Study: High Clinical Suspicion for Melanoma (cont.)
Case Study: High Clinical Suspicion for Melanoma (cont.) Due to the conflicting histopathological and clinical features, the optimal treatment plan was unclear and MyPath Melanoma testing was ordered by the dermatologist. Suggestive of Malignant Neoplasm By leveraging a second GEP test, >99% of pati
Slide 56: Inflammatory Skin Disease
Inflammatory Skin Disease Pipeline test to predict response to systemic therapies with target launch by 2025
Slide 57: Targeting the Unmet Need in Moderate-to-Severe Psoriasis and Atopic Dermatitis
Inflammatory Inflammatory PipelineTest Pipeline Test Targeting the Unmet Need in Moderate-to-Severe Psoriasis and Atopic Dermatitis Common skin diseases with significant patient impacts and costs to health care system • Psoriasis (PSO) and Atopic Dermatitis (AD) are among the most frequently seen sk
Slide 58: Inflammatory Skin Disease Treatment Patient Journey Using Standard Clinical Practice
Inflammatory Pipeline Test Inflammatory Skin Disease Treatment Patient Journey Using Standard Clinical Practice 1 3 5 Typically, topical treatment is initiated, Management plan Patient presents with while some proceed determined skin signs and symptoms directly to systemic based on clinical features
Slide 59: Castle Has Started Two Studies to Aid in Treatment of Inflammatory Skin Diseases
Inflammatory Pipeline Test Castle Has Started Two Studies to Aid in Treatment of Inflammatory Skin Diseases IDENTITY SIGNAL-MF • Help guide therapy selection for atopic • Identify mycosis fungoides (MF) 1 – a type dermatitis and psoriasis of cutaneous T-cell lymphoma that can mimic atopic dermatitis
Slide 60: IDENTITY Study
Inflammatory Pipeline Test IDENTITY Study Castle’s inflammatory skin disease pipeline test is being developed to predict systemic therapy response Committed Sites Patients Enrolled1 2021 2022 2023 2025 Q2-Q3 Q3 Q2 2023 2025 Steering committee First patient enrolled Proof of RNA extraction Initial de
Slide 61: The Non-Biopsy Tissue Collection Method Has Been Validated
Inflammatory Pipeline Test The Non-Biopsy Tissue Collection Method for Our Inflammatory Skin Disease Pipeline Test Has Been Validated 1 2 3 4 Scraping technique to collect superficial epidermis samples Skin prep-cleaning with Gentle scraping with Quality check Storage in RNA alcohol swab a curette p
Slide 62: SIGNAL-MF Study
Inflammatory Pipeline Test SIGNAL-MF Study Castle’s Inflammatory Skin Disease pipeline test could include an ancillary diagnostic to identify mycosis fungoides Target Sites Target Patient Enrollment 2021 2022 2023 2025 Q2-Q3 2023 2025 Protocol finalized and Initial development Target launch IRB appr
Slide 63: Our Test is Expected to Predict Response to Systemic Therapies
Inflammatory Pipeline Test Our Test is Expected to Predict Response to Systemic Therapies for Patients with Moderate-to-Severe Psoriasis, Atopic Dermatitis and Other Related Diseases Our test is expected to be launched in phases, starting with systemic therapies most commonly prescribed in the IDENT
Slide 64: Craig Munroe, M.D. – TissueCypher Barrett's Esophagus
CASTLE BIOSCIENCES Craig Munroe, M.D. TissueCypher > Barrett's Esophagus
Slide 65: 435,000 Barrett's Esophagus Related Endoscopies Per Year
435,000 Barrett’s Esophagus Related Endoscopies Per Year Expert Pathology Need for additional risk stratification tools NDBE 50% of annual progressors are initially (0.63%) (0.80%) 50% diagnosed as non-dysplastic1 Pathology (% progression/year) IND (1.5%) Up to 85% of low-grade patients are downgrad
Slide 66: TissueCypher Is the Strongest Independent Predictor of Progression
TissueCypher Is the Strongest Independent Predictor of Progression Original Pathologic Diagnosis TissueCypher HR = 7.7 (high- vs. low-risk) p<0.0001 HR = 2.8 (inter- vs. low-risk) p<0.0001 n=699 patients1-5 (ND n=567, IND n=50, LGD n=82) 152 incident progressors, 38 prevalent cases, 509 non-progress
Slide 67: After Receiving a High-Risk Score…
AFTER RECEIVING A HIGH-RISK SCORE… NDBE patients are at LGD patients are at 18-fold higher risk of 6.7-fold higher risk of progression1 progression2 Patients harboring 9.4 times more likely prevalent disease are to progress within 1–5 46 times more likely to years4 return a high-risk score3 1Iyer et
Slide 68: After Receiving a Low-Risk Score…
AFTER RECEIVING A LOW-RISK SCORE… NDBE patients are 3.2x LGD or IND patients are less likely to progress vs 2.5x less likely to histologic assessment1 progress vs histologic assessment1 1Data on file, Castle Biosciences 68
Slide 69: 2022 AGA Clinical Practice Update
2022 American Gastroenterological Association (AGA) Clinical Practice Update New Technology and Innovation for Surveillance and Screening in Barrett’s Esophagus: Expert Review V. Raman Muthusamy, M.D., MAS, Sachin Wani, M.D., C. Prakash Gyawali, M.D., Srinadh Komanduri, M.D., MS, for the CGIT Barret
Slide 70: Consideration of Patient Management Based on Risk of Progression
Consideration of Patient Management Based on Risk of Progression 18% 16% 14% Endoscopic Eradication 5-year risk of progression 12% Therapy (EET) or 6–12- month surveillance2 10% 8% 6% 1-year surveillance2 4% 2% 3–5-year surveillance3,4 0% NDBE LGD/IND NDBE1 IND1 LGD1 LGD/IND NDBE (Low-Risk)* (Low-Ri
Slide 71: How Incorporation of TissueCypher Testing Can Change Clinical Practice
How Incorporation of TissueCypher Testing Can Change Clinical Practice Clinical guideline based on histology and segment length NDBE IND LGD Surveillance in 3 to 6 months following Surveillance in 3 to 5 years1,2,3 PPI Rx, EET or 3 years if segment length ≥3 cm2 Surveillance in 12 months for persist
Slide 72: Dr. Srinadh Komanduri Video
Dr. Srinadh Komanduri Video 72
Slide 73: Robert Cook, Ph.D. – IDgenetix
CASTLE BIOSCIENCES IDgenetix
Slide 74: The Mental Health Community Expects More Personalized Care
The Mental Health Community Expects More Personalized Care Right Rx the First Time Faster Rx Response and Remission Reduction in Side Effects Reduction in Personal Healthcare Costs 74
Slide 75: Medication Selection for Mental Illness Is Challenging
Medication Selection for Mental Illness Is Challenging Inadequate Therapy Low High Prevalence of Response Remission Rates Adverse Drug Events ~53% of patients with major 72% of patients with MDD The likelihood of discontinuation rises depressive disorder (MDD) do not achieve remission from 8.6% with
Slide 76: IDgenetix: Precision Medicine Designed to Streamline Medication Selection
IDgenetix: Precision Medicine Designed to Streamline Medication Selection for Mental Health Next Generation PGx Unrivaled Efficacy Easy to Use • Eliminate trial and error • 2x improved chance of • 10 mental health and pain prescribing medication response conditions in one report • 3 in 1 test: • >2.
Slide 77: 2.5x Increase in Remission Rates for Severe Depression
2.5x Increase in Remission Rates for Severe Depression Demonstrated Enhanced Clinical Outcomes vs. Standard of Care >2.5x Response Rate Remission Rate increase in remission rate vs. control ≥ 50% Reduction from Baseline Patients Achieving Remission 2x increase in response rate vs. control p-value 0.
Slide 78: Why IDgenetix PGx Is Important
Why IDgenetix PGx Is Important IDgenetix is redefining the standards of next generation PGx IDgenetix PGx Original Trial & Error Multi-Gene Test RCT/Clinical Utility Medicare Coverage Comorbidity (MDD & Anxiety) Drug-Drug Interactions Lifestyle Factors 78
Slide 79: IDgenetix Addresses an Important Clinical Question
IDgenetix Addresses an Important Clinical Question: How do providers personalize medication choices to increase chances of response and/or remission? USE AS DIRECTED USE WITH CAUTION 79
Slide 80: IDgenetix: Next Generation Precision Medicine
IDgenetix: Next Generation Precision Medicine Old World Integrated Bioinformatics Platform • Trial and error • No genetic testing Age & Metabolism New World Drug-Gene Interactions • Actionable report with clinical support Drug-Drug Interactions • Proprietary bioinformatics platform • Randomized cont
Slide 81: Frank Stokes – ESG Overview, Financial Overview
Frank Stokes ESG Overview Financial Overview
Slide 82: Our Culture and Operations Were Built on ESG Principles
Our Culture and Operations Were Built on ESG Principles Helps mitigate risks Helps progress our Builds employee Uncovers potential Advances sustainable and create vision to transform engagement financial long-term value opportunities disease management and retention opportunities creation for by kee
Slide 83: ESG Focus Areas for 2022 and Beyond
ESG Focus Areas for 2022 and Beyond Environmental policy Environmental metrics DEI statement DEI metrics DEI action plan/roadmap Vendor code of conduct/supplier standard In 2022, Castle Biosciences received a rating of AA (on a scale of AAA-CCC) in the MSCI ESG Ratings assessment. 83
Slide 84: Our Giving Philosophy
Our Giving Philosophy Patient Care Education Community Engagement 84
Slide 85: Financial Overview
C/ASTLE BIOSCIENCES Financial Overview
Slide 86: Our Financial Focus
Drive Robust Test Volume Growth Our Maintain Industry-Leading Adjusted Gross Margins Financial Achieve Operating Cash Flow Positivity by 2025 Focus Maintain Strong Balance Sheet Follow Disciplined Capital Allocation 86
Slide 87: Financial Performance Summary Q2 2022
Financial Performance Summary Q2 2022 Six Months Ended 2Q21 2Q22 June 30, 2022 Total test reports 7,007 11,034 19,661 Total Derm test reports 6,539 9,424 17,539 Revenue $22.8M $34.8M $61.7M Adj. Revenue1 $22.9M $34.3M $62.0M Gross Margin 82.6% 71.9% 71.8% Adj. Gross Margin1 83.9% 77.6% 78.0% Operati
Slide 88: Committed to Delivering Long-term Growth with Net Operating Cash Flow Positivity by 2025
Committed to Delivering Long-term Growth with Net Operating Cash Flow Positivity by 2025 Three-year plan (2025) 25-35% year-over-year growth1; Revenue Total revenue in 2025 of $255m-$330m Adjusted Gross Margins 80%-85% by 2025 Other Operating Expenses2 75%-85% of revenue by 2025 Net Operating Cash F
Slide 89: Excellence of Execution: Test Volume Since Launch
Excellence of Execution: Legacy Uveal Melanoma Test is Standard-of-Care, Skin Cancer Tests Showing Strong Adoption DecisionDx-Melanoma (launched May 2013) ~20% penetration1 Test Volume2 MyPath/DiffDx (launched Nov 2020) ~1% penetration1 DecisionDx-SCC (launched Aug 2020) ~3% penetration1 TissueCyphe
Slide 90: DecisionDx-Melanoma Adoption Since Launch
DecisionDx-Melanoma Adoption Since Launch Consistent growth in volume and market penetration driven by clinical value and commercial excellence 18% DecisionDx-Melanoma test report volume 16% Estimated market penetration 12% 20,328 9% 16,232 7% 15,529 5% 12,032 2% 9,300 6,295 2,858 Number of 2015 201
Slide 91: Strong Revenue CAGR of 60% Drives Exceptional Adjusted Gross Margins
Strong Revenue CAGR of 60% Drives Exceptional Adjusted Gross Margins 85% 85% 83% 76% 94.1 74.9 62.6 51.9 52.8 42.1 22.8 17.1 2018 2019 2020 2021 Revenue Adjusted Gross Margin* Adjusted Gross Margin %* 91 *See Non-GAAP reconciliations at the end of this presentation.
Slide 92: Product Launches, Focused Investments Expected to Drive Revenue Growth
Product Launches, Focused Investments Expected to Drive Revenue Growth Full-Year Revenue Quarterly Operating Expenses (millions) $130-$135 Expanded from 23 Launched DiffDx- Acquired MyPath Acquired Guidance to 32 Derm sales Melanoma Melanoma; AltheaDx territories doubled Derm team to mid-60s Expense
Slide 93: Strong Balance Sheet Keeps Us Positioned Well for Long-term Growth
Strong Balance Sheet Keeps Us Positioned Well for Long-term Growth Strong cash position and no debt June 30, 2022 December 31, 2021 Cash and cash equivalents $273,166 $329,633 Accounts receivable, net 22,606 17,282 Other current assets 9,140 6,828 Total current assets 304,912 353,743 Long-term asset
Slide 94: Disciplined Approach to Capital Allocation
Disciplined Approach to Capital Allocation • Focused R&D efforts to build evidentiary support and develop pipeline tests • Commercial optimization • To a lesser priority, tuck-in acquisitions in the areas of our current three franchises Expected net operating cash flow positivity by 2025 94
Slide 95: Castle's Expected Common-Size P&L Model at Maturity
Castle’s Expected Common-Size P&L Model at Maturity Demonstrates Efficient Execution *See Non-GAAP reconciliations at the end of this presentation. 95
Slide 96: Key Financial Highlights Takeaways
Key Financial Highlights Takeaways By 2025, we expect: Total revenue of between $255 million Our focused growth to $330 million The demonstrated investments, value and utility of our including Adjusted Gross Our growing revenue Our long-term growth tests, along with our acquisitions, have Margins in
Slide 97: Summary
CASTLE BIOSCIENCES Summary Derek Maetzold
Slide 98: Upcoming Milestones
Upcoming Milestones Expected publication of Expected finalization of Expect new GI collaborative NCI study showing Palmetto/Meridian LCD for DiffDx- and MyPath/DiffDx commercial higher melanoma specific survival Melanoma by end of Q2 2023; team expansion to reach optimal for patients tested MyPath M
Slide 99: Driving Long-Term Growth through Strong Execution and our Operational Guideposts
Driving Long-Term Growth through Strong Execution and our Operational Guideposts Exceptional Employees, Continuous Evolution & Improvement and Customer & Solution Centric Near- to Mid-term Growth Mid- to Long-term Growth Strategic Mental Health Opportunities Mental Health Gastrointestinal Gastrointe
Slide 100: Castle's Innovative Tests Provide Value for Patients
Castle’s Innovative Tests Provide Value for Patients Data from two patient studies conducted in collaboration with the Melanoma Research Foundation Wanted prognostic information about their Felt the testing 90% melanoma tumors at 92% was useful1 diagnosis1 Indicated they Wanted prognostic gained val
Slide 101: Castle Is Focused on Improving Health through Innovative Tests That Guide Patient Care
Castle Is Focused on Improving Health through Innovative Tests That Guide Patient Care Three strategic guideposts that create value for customers, patients and stockholders Customer and Solution Centric Continuous Evolution and Improvement Exceptional Employees 101
Slide 102: Q&A
Q&A Derek Maetzold Frank Stokes Matthew Goldberg, M.D. Craig Munroe, M.D. Camilla Zuckero Founder, President & Chief Financial Officer Medical Director GI Medical Director Vice President, Investor Chief Executive Officer Relations & Corporate Affairs 102
Slide 103: Investor Day
Investor Day Thank you for joining September 20, 2022
Slide 104: Use Of Non-GAAP Financial Measures (Unaudited)
Use Of Non-GAAP Financial Measures (Unaudited) In this presentation, we use the metrics of Adjusted Revenue, Adjusted Gross Margin and Adjusted Operating Cash Flow, which are non-GAAP financial measures and are not calculated in accordance with generally accepted accounting principles in the United
Slide 105: Reconciliation of Non-GAAP Financial Measures (Unaudited)
Reconciliation of Non-GAAP Financial Measures (Unaudited) The table below presents the reconciliation of adjusted revenue and adjusted gross margin, which are non-GAAP financial measures. See the previous slide for further information regarding the Company’s use of non-GAAP financial measures. 3 Mon
Slide 106: Reconciliation of Non-GAAP Financial Measures (Unaudited)
Reconciliation of Non-GAAP Financial Measures (Unaudited) The table below presents the reconciliation of adjusted operating cash flow, which is a non-GAAP financial measure. See slide 104 for further information regarding the Company’s use of non-GAAP financial measures. 3 Months Ended - June 30, 6
Slide 107: Reconciliation of Non-GAAP Financial Measures (Unaudited)
Reconciliation of Non-GAAP Financial Measures (Unaudited) The table below presents the reconciliation of adjusted revenue and adjusted gross margin, which are non-GAAP financial measures. See slide 104 for further information regarding the Company’s use of non-GAAP financial measures. (in thousands)
Slide 108: Reconciliation of Non-GAAP Financial Measures (Unaudited)
Reconciliation of Non-GAAP Financial Measures (Unaudited) The table below presents the reconciliation of adjusted operating income, which is a non-GAAP financial measure. See slide 104 for further information regarding the Company’s use of non-GAAP financial measures. Adjusted gross margin Gross mar
Slide 109: Appendix
CASTLE BIOSCIENCES Appendix
Slide 110: Leadership Team Overview
Leadership Team Overview 110