Natera, Inc. · NASDAQ:NTRA
Natera — Q1 2018 Earnings Presentation
13 slides from Natera's earnings presentation, May 8, 2018
Slide 1: Natera, Inc. Q1 2018 Earnings Call
Natera, Inc. Q1 2018 Earnings Call May 8, 2018
Slide 2: Safe Harbor
Safe Harbor This presentation contains forward-looking statements. All statements other than statements of historical facts contained in this presentation, including statements regarding the market opportunity, products, commercial partners, user experience, clinical trials, financial performance, s
Slide 3: Natera's strategic vision coming to fruition
Natera’s strategic vision coming to fruition Return to growth Oncology franchise Record volumes in Q1 ramping 25%+ y/y revenue growth Exceptional data, 10+ pharma Promising outlook from new products partners signed, more in pipeline Realizing IVD strategy Continuous COGS Emerging licensing / royalty
Slide 4: Recent highlights
Recent highlights • Processed 164,355 tests in Q1 2018, 36% growth vs. Q1 2017 and 19% growth vs. Q4 2017 – Panorama®: approximately 115,000 tests processed, 29% growth YoY and 18% vs. Q4 2017 – HorizonTM: approximately 41,535 tests accessioned, 54% growth YoY and 21% vs Q4 2017 • Total revenues of
Slide 5: Driving growth in core products
Driving growth in core products Processed Units Accessioned Units 45,000 41,535 120,000 114,672 40,000 110,000 34,442 35,000 32,758 30,705 100,000 97,000 30,000 26,899 89,351 91,247 90,000 88,793 25,000 20,000 80,000 15,000 70,000 10,000 60,000 5,000 50,000 - Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018
Slide 6: Signatera (RUO) highly predictive of relapse across tumor types
TM Signatera (RUO) highly predictive of relapse across tumor types Lung (1) Bladder (2) Colon (3) % Relapse-free survival (n=39) (n=10) (n=45) (n=14) (n=9) HR 19.8 * HR 34.5 HR 31.8 * (n=13) p < 0.005 p < 0.001 p < 0.0001 * Time post surgery • Avg lead time 4 mos • Avg lead time 4 mos • Avg lead tim
Slide 7: First ctDNA platform custom built for monitoring and MRD
First ctDNA platform custom built for monitoring and MRD Signatera™(RUO) Other Liquid Biopsy Clinical purpose Staging at diagnosis Genomic profiling MRD assessment Selection of targeted therapies Treatment monitoring Recurrence monitoring Analog Imaging Tissue biopsy Report type Presence/absence of
Slide 8: Average selling prices stable
Average selling prices stable Three Distinct Pricing Headwinds Pricing Drivers Going Forward Total revenues / tests accessioned • Multi-year, fixed price Shift from procedure payer contracts code to NIPT code In-Network shift • Increasing average risk $1,000 Shift from procedure code to NIPT coverag
Slide 9: Natera's path to cash flow breakeven
Natera’s path to cash flow breakeven • Steady volume growth • Stable pricing • Continued momentum in COGS reductions • Stable operating expenses as revenues grow Not for further reproduction or use 8
Slide 10: R&D investments driving strong returns
R&D investments driving strong returns Blended COGS Trajectory $450 $124 savings per unit X $400 $388 615,000 tests / year $350 = $300 $283 $264 $76MM annual savings $250 ~ $200 $200 $150 ~72% ROIC $100 on all R&D spend $50 since Q1 2015 $0 Q1 2015 Q4 2017 Q1 2018 Funded projects Not for further rep
Slide 11: Q1 2018 financial overview
Q1 2018 financial overview Growth in Panorama and Horizon volumes is primary driver of change vs Q1 2017 ($ in millions, except for per share data) P&L Q1’18 Q1’17 Change Horizon Revenue $ 18.3 $ 13.0 $ 5.3 Panorama Revenue $ 33.3 $ 32.6 $ 0.7 Total Revenue $ 62.3 $ 49.4 $ 12.9 Gross Margin% 1 35% 3
Slide 12: 2018 guidance unchanged
2018 guidance unchanged ($ in millions) Revenue $250 - $275 Gross Margin % revenue 35% - 40% SG&A $140 - $150 R&D $50 - $55 Cash Burn $40 - $60 Not for further reproduction or use 11
Slide 13: Natera
B natera’ Conceive. Deliver.