Slide 1: Natera Third Quarter 2023 Earnings Call
Natera, Inc. Investor presentation Third Quarter 2023 Earnings Call November 8, 2023
Slide 2: Safe harbor statement
Safe harbor statement This presentation contains forward-looking statements under the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this presentation, including statements regarding our market opportunities, our
Slide 3: Q3 highlights
Q3 highlights • $268M in total revenue, 27% growth over Q3 2022. Product revenues grew 33% year on year. • Processed 626K units, up 21% year on year. • Processed 81K Signatera clinical units, one of our largest unit growth quarters, up 85% vs. Q3 2022 and 9K units vs. Q2 2023 • 45% gross margin on o
Slide 4: Quarterly processed volumes demonstrate continued momentum
Quarterly processed volumes demonstrate continued momentum 700K Core Volume Drivers 626K • Serving large, 600K underpenetrated markets 518K 503K • Differentiated 500K technology backed by strong evidence 407K 394K 400K • Growth in Signatera clinical as margin profile improves • Strong women’s health
Slide 5: Strong reimbursement and volumes driving revenues
Strong reimbursement and volumes driving revenues Total revenues: year on year trend Product revenues: year on year trend ($ in millions) ($ in millions) $300 $300 $268 $265 $250 $250 $211 $200 $200 $200 • Significant $158 $154 opportunity available $150 $150 across women’s health, organ health, $98
Slide 6: ASPs and COGS execution driving organic gross margin gains
ASPs and COGS execution driving organic gross margin gains Gross margin quarterly trend One-time benefits: Organic: ASP, COGS COGS credit, lumpy trends ahead of plan Volume-based initiatives pharma payment impacting margin: CA NIPT, 46% carrier screening, Signatera • Significant sequential 45% volum
Slide 7: Publication of landmark RenaCARE study
Publication of landmark RenaCARE study1 Real-world, prospective study of comprehensive genetic testing in chronic kidney disease (1,600+ patients) Addressing unmet needs Significant diagnostic utility Strong clinical utility 37M 20.8% 32.9% US adults have of patients had of positive patients CKD2 po
Slide 8: RenaCARE study highlights utility of Renasight in CKD
RenaCARE study highlights utility of Renasight in CKD1 A genetic diagnosis unveils a prognosis and treatment options that are now patient-specific Unknown cause Non-specific CKD Undefined CKD Additional drivers of utility of CKD diagnoses subtype across clinical categories: A causative diagnosis cou
Slide 9: Oncology continues to generate strong volume growth
Oncology continues to generate strong volume growth • Growth driven by new patient initiations, repeat testing in existing patients, and adoption by new physicians who had never ordered Signatera before • 35% of US oncologists ordered Signatera in the quarter with continued increases in new accounts
Slide 10: Updated 24 Mos. GALAXY analysis at ESMO 2023
Updated 24 Mos. GALAXY analysis at ESMO 2023 bodes well for readout of randomized ALTAIR + VEGA trials MRD-positive patients: significant chemo benefit MRD-negative patients: no significant chemo benefit (24M-DFS: 38.6% with chemo v. 16.1% w/o chemo) (24M-DFS: 88.3% with chemo v. 89.9% w/o chemo) AL
Slide 11: Treatment on molecular relapse: major opportunity
Treatment on molecular relapse: major opportunity • New ctDNA-guided treatment approach, leveraging the Quantity of ctDNA power of serial testing Novel treatment • Objective: to delay/prevent if testing R ctDNA overt recurrence with positive Control arm (SOC) identification and treatment + on molecu
Slide 12: Growing body of evidence in lung cancer across settings
Growing body of evidence in lung cancer across settings Neoadjuvant setting Adjuvant setting Metastatic setting Stage I-III neoadjuvant NSCLC Stage I-III unresectable NSCLC Empower-Lung11 Cascone et al, 2023 Lebow et al, 2023 ASCO 2023 NeoCoast platform trial evaluated dual IO 82% pre-treatment dete
Slide 13: FoundationOne Tracker Now Available in US
FoundationOne®Tracker Now Available in US Monitors treatment response for patients with advanced cancer across all solid Genomic information Personalized MRD tumors. derived from assay design and FoundationOne®CDx analysis Medicare coverage in place for immunotherapy (I/O) monitoring, effective 6/17
Slide 14: Q3 financial overview
Q3 23 financial overview ($ in millions, except for per share data) P&L Q3’23 Q3’22 Change Y/Y Product revenues $265.2 $199.8 $65.4 Licensing and other revenues $3.1 $10.8 ($7.7) Total revenues $268.3 $210.6 $57.7 Gross margin% 45.1% 44.7% 41 bps R&D $77.2 $65.5 $11.7 SG&A $154.7 $147.7 $7.0 Net los
Slide 15: Cash burn reduction target ahead of plan
Cash burn reduction target ahead of plan • Expected cash burn reduction Quarterly cash burn trend compared to 2022 of more than ($ in millions) $180 $200M on continued revenue growth $1622 and reduction in operating expenses. $160 $140 • Cash burn reductions will fluctuate $110 $1131 $120 quarter to
Slide 16: 2023 guidance: raising revenue & gross margin; reducing cash burn
2023 guidance: raising revenue & gross margin; reducing cash burn Guide ($ millions) Original Q1 23 Q2 23 Current Key drivers Continued volume growth, Revenue $980 – $1,000 $995 – $1,015 $1,015 – $1,035 $1,035 – $1,050 conservative ASPs, strong oncology contribution Gross ASPs, COGS trends continue
Slide 17: ©2023 Natera, Inc. All Rights Reserved. Not for reproduction or further distribution.
® ©2023 Natera, Inc. All Rights Reserved. Not for reproduction or further distribution.