Castle Biosciences, Inc. · NASDAQ:CSTL
Castle Biosciences — Investor Presentation (December 2020)
39 slides from Castle Biosciences's investor presentation, Dec 14, 2020
Slide 1: The Skin Cancer Diagnostics Company – Company Presentation
The Skin Cancer Diagnostics Company November 9, 2020 NASDAQ: CSTL COMPANY PRESENTATION
Slide 2: Disclaimers
2 DISCLAIMERS › Forward-Looking Statements › The information in this presentation contains forward-looking statements and information 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
Slide 3: Castle Biosciences
3 Castle Biosciences Innovators in Proprietary Gene Expression Profile Tests for Dermatologic Cancers Innovative Products Strong Financials Evidence Development Improving Health Outcomes Of Patients With Skin Cancer Through Innovative, Clinically Actionable, Cost-Effective Diagnostics
Slide 4: 3Q2020: Strong Financials
3Q2020: Strong Financials 3Q20 3Q19 Nine months ended 9/30/20 Nine months ended 9/30/19 Revenue $15.2M $14.8M $45.4 $34.2M DecisionDx-Melanoma reports 4,404 4,126 11,986 11,049 DecisionDx-UM reports 318 356 985 1,092 Operating Cash Flow $(3.0)M $0.8M $10.3M $2.5M Adj. Operating Cash Flow 1 $(3.0)M $
Slide 5: In-market products target an estimated $2.0B U.S. total addressable market
5 Castle’s in-market dermatological cancer products target an estimated $2.0B U.S. total addressable market 1 1U.S. TAM = Total addressable market based on estimated patient population assuming average reimbursement rate among all payors. 2 Annual U.S. incidence for Stage I, II o r III melanoma esti
Slide 6: Our main focus is serving the skin cancer market
6 MCR = Medicare. MCRA = Medicare Advantage; current customer estimates based on LTM. Our main focus is serving the skin cancer market DecisionDx-SCC and DiffDx-Melanoma are utilizing existing relationships Indication / Test outcome Trade Name Commercial Status Reimbursement Status Peer-Reviewed Pub
Slide 7: The Skin Cancer Diagnostics Company
The Skin Cancer Diagnostics Company
Slide 8: DecisionDx-Melanoma: well studied, informs cancer management decisions
DecisionDx-Melanoma: well studied, informs cancer management decisions *According to SORT system, used by AAD; **Through 9/30/2020; ***LTM as of 9/30/2020 >5,700 Patients included in studies including an independent validation 26 Peer-reviewed, published studies including 2 meta-analyses 1A Category
Slide 9: Limitations of current staging; DecisionDx-Melanoma informs two clinical decisions
Is the risk of SLN- positivity high enough to warrant referral for the SLNB surgery? Tumor thickness, age, and DecisionDx- Melanoma Is the risk of recurrence high enough to warrant initiation of imaging, high frequency follow-up, adjuvant therapy, and clinical trial enrollment? Tumor thickness, ulce
Slide 10: DecisionDx-Melanoma workflow
DecisionDx-Melanoma workflow: after diagnosis for more accurate prediction of risk Primary CM Tissue (FFPE) Castle CAP/CLIA Certified Lab RNA Isolation 31 Gene Expression Profile Proprietary Algorithm Predicts Class Patients with Stage I – III Melanoma Class 1: Low risk of SLN positivity (eligible T
Slide 11: DecisionDx-Melanoma enables rule-out and rule-in for T1-T2 melanomas
11 DecisionDx-Melanoma enables rule-out and rule-in for T1-T2 melanomas DecisionDx- Melanoma Result Probability of a Positive Sentinel Lymph Node1 All Ages (n=1065) ≥65 years (n=448) 55-64 years (n=247) <55 years (n=370) Class 1A 4.6% 1.6% 4.9% 7.6% Class 1B/2A 10.8% 6.9% 7.7% 19.6% Class 2B 18.8% 1
Slide 12: DecisionDx-Melanoma is a significant independent predictor of outcomes
DecisionDx-Melanoma is a significant independent predictor of outcomes 1Gerami et al. Clin Cancer Res 2015. 2Gastman et al. Jrnl Amer Acad Dermatol 2019. 3Hsueh et al. Jrnl Hematol Oncol 2017. 4Podlipnik et al. Jrnl Eur Asso Veneral and Derm 2019. 0 1 2 3 4 5 6 7 8 9 10 Archival, Multi-center1 Disea
Slide 13: Stratifies risk of recurrence beyond AJCC staging
DecisionDx-Melanoma stratifies risk of recurrence beyond AJCC (8th ed.) staging Stage I II III M e la n o m a -S p e c if ic S u rv iv a l (M S S ) (% ) Low Risk Stage I-IIA High Risk Stage IIB-III 99.6% ≈AJCC IA 89.5% ≈AJCC IIIA >99% ≈AJCC IA 84.7% ≈AJCC IIIB 94.8% ≈AJCC IIA 61.2% ≈AJCC IIIC+ 98% N
Slide 14: 50% of patients have a change in management
14 50% of patients have a change in management 1Berger, et al. 2016 Curr Med Res Opin; 2Dillon et al. 2018 Skin; 3Farberg et al. 2017 Jrnl Drugs Derm; 4Schuitevoerder, et al. 2018 Jrnl Drugs Derm. 4 consecutive clinical impact studies have shown 47-53% change in risk of recurrence management Changes
Slide 15: Informs both primary treatment decisions
15 DecisionDx-Melanoma informs both primary treatment decisions, addressing the issues of over- and under-treatment Vetto et al. Future Oncol 2019; Marks et al SKIN J Cutaneous Med 2019 What’s the risk of melanoma recurrence? Informs clinical follow- up, referrals, imaging, adjuvant therapy Class 1A
Slide 16: The Skin Cancer Diagnostics Company
The Skin Cancer Diagnostics Company
Slide 17: Designed to predict individual metastatic risk for high-risk SCC
17 Designed to predict individual metastatic risk to inform risk-appropriate management For high-risk SCC patients with one or more risk factors ~200,000 patients present with high- risk features annually; $820M U.S TAM1 Validated in 420- patient cohort of high-risk SCC from 33 U.S. centers 4 peer-r
Slide 18: DecisionDx-SCC: Designed to predict metastatic risk
18 DecisionDx-SCC: Designed to predict metastatic risk for high-risk SCC patients DecisionDx-SCC is a validated predictor of risk in uni- and multivariate analysis. Incorporation of DecisionDx-SCC with traditional risk factors can improve patient classification compared to either approach alone. Add
Slide 19: DecisionDx-SCC validated to predict metastatic risk
DecisionDx-SCC is validated to predict metastatic risk for individual SCC patients with one or more risk factors M e ta st a si s- fr e e s u rv iv a l (M FS ) Years n = 420 p < 0.0001 Kaplan-Meier Estimated MFS Wysong et al. JAAD 2020; Ibrahim et al. submitted; Data on file, Castle Biosciences. Cla
Slide 20: Class 2A and 2B are strong independent predictors of metastasis
* 20 DecisionDx-SCC Class 2A and Class 2B are strong independent predictors of metastasis 0 5 10 Hazard Ratio 0 5 Hazard Ratio Immunosuppression Tumor diameter (per cm) Perineural invasion Deep invasion Poor differentiation Class 2A Class 2B Wysong et al. JAAD 2020; Ibrahim et al. submitted; Data on
Slide 21: Risk of metastasis and management plans
• Surgery, if feasible • Consider nodal imaging / staging • Consider oncology referral • Surgery, if feasible • Nodal imaging / staging • Consultation: radiation oncology • Consultation: medical oncology Treatment plans may include: • Surgery, if feasible • Clinical nodal exam Low Intensity Moderate
Slide 22: The Skin Cancer Diagnostics Company
The Skin Cancer Diagnostics Company
Slide 23: Improving diagnostic resolution for the benefit of patient care
23 Improving diagnostic resolution for the benefit of patient care A definitive result from DecisionDx DiffDx-Melanoma in ≥96% of lesions submitted for testing Includes multiple subtypes of lesions with uncertain malignant potential Demonstrated technical success rate of 96% 5-7 day turn around time
Slide 24: The unmet need in difficult-to-diagnose melanocytic lesions
24 The unmet need in patients with a difficult-to-diagnose melanocytic lesion Of the estimated 2 million suspicious pigmented lesions biopsied annually in the U.S., approximately 300,000 of those cannot be classified with confidence as either benign tissue or melanoma through traditional histopathol
Slide 25: Dermatopathologists and dermatologists work together to diagnose melanoma
25 Dermatopathologists and dermatologists work together to diagnose melanoma A suspicious pigmented lesion is examined by a doctor or dermatologist by visual inspection and/or with a dermatoscope. If warranted, the lesion is biopsied. Lesion is examined via microscope by a dermatopathologist or path
Slide 26: Uncertainty creates an over- or under-treatment dilemma
26 The Clinical Issue: Uncertainty creates an over- or under-treatment dilemma Definitive melanoma diagnoses (invasive or in situ) Definitive benign melanocytic diagnoses SLNB Imaging Increased follow-up No additional treatment Routine follow-up Clinically evaluated suspicious pigmented / melanocyti
Slide 27: DecisionDx DiffDx-Melanoma
27 DecisionDx DiffDx-Melanoma Designed to improve diagnostic resolution for the benefit of patient care Utilizing machine-learning (AI) to obtain improved accuracy metrics and substantially reduced intermediate-risk zone, DecisionDx DiffDx-Melanoma has been demonstrated to provide a definitive resul
Slide 28: DiffDx-Melanoma designed and validated to improve diagnostic resolution
DecisionDx DiffDx-Melanoma is designed and validated to improve diagnostic resolution for the benefit of patient care All ages N=503 Age > 65 years N=178 DecisionDx DiffDx-Melanoma 95% CI DecisionDx DiffDx- Melanoma 95% CI Sensitivity 99.1% 97.9-100 99.2% 97.6-100 Specificity 94.3% 91.5-97.1 100% 10
Slide 29: Improving diagnostic resolution for the benefit of patient care
29 Improving diagnostic resolution for the benefit of patient care To aid dermatopathologists in characterizing suspicious pigmented lesions ~300,000 suspicious pigmented lesions annually; $600M U.S TAM1 Technical success rate of 96% 2 peer-reviewed publications2 to date Utilizing existing relations
Slide 30: The Skin Cancer Diagnostics Company
The Skin Cancer Diagnostics Company
Slide 31: Uveal Melanoma – A Rare Eye Cancer
31 : STANDARD OF CARE ~1,600 patients diagnosed in the U.S. annually ~97% of patients – no evidence of metastatic disease at the time of diagnosis ~30% will develop metastases within 3 years Uveal Melanoma – A Rare Eye Cancer 15-Gene Expression Profile (GEP) Test Low-risk: ~67% Low Intensity Managem
Slide 32: Financial Overview
The Skin Cancer Diagnostics Company FINANCIAL OVERVIEW
Slide 33: Factors driving near- and long-term growth
33 Factors driving near-and long-term growth Test Report Volume Commercial sales team expansion in 2H20, further expansion expected in 2021 Reimbursement Strong ASP growth DecisionDx-Melanoma $7,193 PAMA rate through 2021 Revenue Gross Margins 84% in Q320 Continued margin expansion of existing produ
Slide 34: Continued revenue growth, driven by test report and ASP growth
34 Continued revenue growth, driven by test report and ASP growth* 2015 2016 2017 2018 2019 Report Volume Growth DecisionDx-UM DecisionDx-Melanoma 3,956 7,490 13,445 10,614 17,055 $3.7m $14.8m $15.2m 3Q 2018 3Q 2019 3Q 2020 Revenue *3Q2020 ASP growth over 3Q2019 and 3Q2018
Slide 35: Recent achievements and expected future milestones
Recent achievements and expected future milestones 2020 milestones on track 2020 2021 2018 2019 35 Oct 2020: LCD expansion finalized for DecisionDx-Melanoma, effective date 11/22/20 2021: Potential draft LCD for DecisionDx-SCC and DecisionDx DiffDx- Melanoma 2022 Dec 2018: Initial LCD effective for
Slide 36: In-market products target an estimated $2.0B U.S. total addressable market
36 Castle’s in-market dermatological cancer products target an estimated $2.0B U.S. total addressable market 1 1U.S. TAM = Total addressable market based on estimated patient population assuming average reimbursement rate among all payors. 2 Annual U.S. incidence for Stage I, II o r III melanoma est
Slide 37: Thank You
The Skin Cancer Diagnostics Company THANK YOU
Slide 38: Use of Non-GAAP Financial Measures
› In this presentation, we use the metric of Adjusted Operating Cash Flow, which is a non-GAAP financial measure and is not calculated in accordance with generally accepted accounting principles in the United States (GAAP). This non-GAAP financial measure reflects adjustments to net cash provided by
Slide 39: 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 measure. See "Use of Non-GAAP Financial Measures (UNAUDITED)" above for further information regarding the Company's use of non-GAAP financial mea
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