Grail, Inc. · NASDAQ:GRAL
Grail — Investor Day (May 2024)
73 slides from Grail's investor day presentation, May 13, 2024
Slide 1: Capital Markets Day
Capital Markets Day May 13, 2024 CONFIDENTIAL & PROPRIETARY 1
Slide 2: Forward-looking statements disclaimer
This informational meeting regarding GRAIL, LLC ("GRAIL," "we," "us," "our" or the "Company") is for you to familiarize yourself with the company. This presentation contains forward-looking statements. These statements may relate to, but are not limited to, expectations of future operating results o
Slide 3: GRAIL leadership presenting today
GRAIL leadership presenting today Bob Ragusa Aaron Freidin Joshua Ofman MD, MSHS Sir Harpal Kumar Chief Executive Officer Chief Financial Officer President President, Biopharma & Europe CONFIDENTIAL & PROPRIETARY 3
Slide 4: Agenda
Agenda 1 Introduction 2 Investment highlights 3 The promise of multi-cancer early detection (MCED) 4 Commercial strategy 5 Scientific background & clinical evidence 6 Opportunity beyond asymptomatic screening 7 Financial profile & inflection points CONFIDENTIAL & PROPRIETARY 4
Slide 5: Investment highlights
Investment highlights CONFIDENTIAL & PROPRIETARY 5
Slide 6: Detect cancer early, when it can be cured.
Detect cancer early, when it can be cured. CONFIDENTIAL & PROPRIETARY 6
Slide 7: GRAIL highlights
GRAIL highlights Focused on detecting cancer early, when it can be cured1 • Current recommended screening is limited, and most deadly types of cancers are found too late • Multi-cancer early detection (MCED) is the solution for effective population screening Uniquely suited to address one of the mos
Slide 8: Multiple catalysts to drive value
Multiple catalysts to drive value International expansion Broad US and UK reimbursement Galleri FDA approval MCED legislation Potential NHS commercial Launch an pilot updated version of Galleri CONFIDENTIAL & PROPRIETARY 8
Slide 9: The global opportunity for MCED is significant
The global opportunity for MCED is significant >100M ~20M US >300M Major global markets Estimated screening populations represent adult population between 50–79 years of age. US Census and international government statistics. Includes certain developed countries worldwide. CONFIDENTIAL & PROPRIETARY
Slide 10: Our vision: Population-scale multi-cancer early detection
Our vision: Population-scale multi-cancer early detection (MCED) Laying the groundwork today to intercept the opportunity CONFIDENTIAL & PROPRIETARY 10
Slide 11: GRAIL has made rapid progress since inception
GRAIL has made rapid progress since inception 2016–2018 2019–2023 2021–2023 2024+ Foundational investment Validating tech Investments for scale Up next GRAIL established based on Analytical validation results Commercial launch of Galleri® Registrational study read outs: Illumina NIPT research discov
Slide 12: GRAIL's scientific leadership is shaping the MCED field
GRAIL's scientific leadership is shaping the MCED field >385,000 >260 Publications in leading Clinical study participants forums1 Clinical program size includes participants enrolled and to be enrolled across studies. 1 Cumulative publications includes presentations and manuscripts through year end
Slide 13: Robust Galleri adoption prior to broad reimbursement
Robust Galleri adoption prior to broad reimbursement $93M FY23 revenue Best Inventions of 2022 >180k Commercial Galleri tests sold 2022 Breakthroughs of the Year >10k Ordering providers World Changing Ideas of 2022 >100 Commercial partnerships 2023 Change the World List Commercial tests sold, orderi
Slide 14: GRAIL has established a robust, sustainable lead
GRAIL has established a robust, sustainable lead Early investment and market experience drive continued advantage Clinical Clinical Clinical Real world FDA approval/ Early validation utility Marketed validation evidence/ broad interest study study product data experience reimbursement initiated init
Slide 15: Strong company leadership
Strong company leadership Executive team Board Members Bob Ragusa Joshua Ofman, Sir Harpal Kumar Aaron Freidin Greg Summe Chief Executive MD, MSHS President, Biopharma Chief Financial Founder & Managing Officer President Business & Europe Officer Partner at Glen Capital, and previously Chairman & CE
Slide 16: The promise of Multi-Cancer Early Detection
The promise of Multi-Cancer Early Detection CONFIDENTIAL & PROPRIETARY 16
Slide 17: Cancer has a significant impact
Cancer has a significant impact 19M New cases annually2 #2 10M Cause of death $25T Deaths annually2 globally3 Estimated global economic cost of cancer care 2020-20501 1 JAMA Oncol. 2023;9(4):465-472. doi:10.1001/jamaoncol.2022.7826. 2 WHO, All Cancers Fact Sheet 2020. 3 ACS, Cancer Statistics 2022,
Slide 18: Cancers are often found too late
Cancers are often found too late >80% 86% ~4x Cancer deaths result Of cancers are not found Survival rate when from cancers without through recommended diagnosed recommended screening2 EARLY3 screening1 1 US National Center for Health Statistics, with eligibility for and adherence to guideline based
Slide 19: MCED is the solution for effective population screening
MCED is the solution for effective population screening Adding additional single-cancer screenings Today’s standard IMPRACTICAL AT POPULATION SCALE of care screenings • Single cancer tests are impractical for less prevalent cancers LIMITED YIELD • Optimizes sensitivity over specificity • Results in
Slide 20: Stacking single cancer tests results in an unacceptable cumulative false positive rate
Stacking single cancer tests results in an unacceptable cumulative false positive rate A 60-year-old female with a history of smoking screened for 4 cancers would have a high false positive rate (Illustrative) 12.8% FPR for low dose computed tomography 7.4% FPR for cervical cancer screening Real wor
Slide 21: Galleri + standard of care screening enables detection of more cancers
Galleri + standard of care screening enables detection of more cancers more efficiently CANCERS DETECTED FALSE POSITIVES SOC screenings ~185k ~8,100k Galleri ~460k ~530k ~65% reduction in cost to diagnose one cancer1 SOC: USPSTF recommended cancer screening. Data on file. Third pre-planned case-cont
Slide 22: Galleri: Clinically-validated, commercially-available MCED test
Galleri®: Clinically-validated, commercially-available MCED test¹ Simple blood test Very low false positive rate Predicts cancer signal origin Identifies aggressive cancers 1 We believe that the results of our large CCGA clinical study provides clinical validation for Galleri. Klein, et al, Clinical
Slide 23: Galleri compares favorably to current standard of care
Galleri compares favorably to current standard of care Galleri and SOC performance CANCER TESTING METHOD POSITIVE PREDICTIVE VALUE (%) FALSE POSITIVE RATE (%) Galleri* Multi- 43.1 0.5 (blood test) Prostate1 Blood test 30 10.4 Cervical2 Cytology / HPV test 19.0 7.4 Lung3 Low-dose CT scan 3.8 12.8 Bre
Slide 24: Commercial use of Galleri is finding early cancers
Commercial use of Galleri is finding early cancers EXAMPLES OF CONFIRMED EARLY-STAGE CANCERS Head + neck Without multi-cancer early detection, I would be dead now. I was diagnosed with pancreatic cancer 18 Esophageal months ago. I've had six months of chemotherapy and surgery, [and] currently no evi
Slide 25: Galleri test report is designed to provide a clear result
Galleri test report is designed to provide a clear, easy to understand result Detection "Cancer Signal Detected”: Test detected DNA methylation patterns associated with cancer "No Cancer Signal Detected”: Test did not detect DNA methylation patterns associated with cancer Prediction To guide diagnos
Slide 26: GRAIL provides clinical support services for positive tests
GRAIL provides clinical support services for positive tests Access to peer-to- peer consultations Positive result resource center Patient care navigation Tumor board Galleri re-test program CONFIDENTIAL & PROPRIETARY 26
Slide 27: Commercial strategy
Commercial strategy CONFIDENTIAL & PROPRIETARY 27
Slide 28: Today's commercial strategy focused on multiple stakeholders
Today’s commercial strategy focused on multiple stakeholders • Providers & clinics: Offer innovative, cutting-edge health offerings PROVIDERS & CLINICS HEALTH SYSTEMS • Health systems: Opportunity to increase >10k >40 revenues and attract new customers EMPLOYERS LIFE INSURANCE • Employers: Proven ea
Slide 29: Focused commercial team drives adoption
Focused commercial team drives adoption Clinic salesforce MCED market ~200 Health systems sales Sales leader personnel Enterprise business development CONFIDENTIAL & PROPRIETARY 29
Slide 30: NHS England roll out could be first national health system MCED implementation
NHS England roll out could be first national health system MCED implementation • Commercial agreement with NHS — known for high evidence standards for new technologies — could enable national roll-out after NHS-Galleri trial completion expected in 2026 • An early pilot could be initiated in 2024 sub
Slide 31: GRAIL has made investments for scale
GRAIL has made investments for scale Invested in operational scale ~65,000 sf CAP-accredited, CLIA-certified lab facilities Sufficient capacity to support multiple years of growth Established US and UK footprint >1,300 employees Operations in Menlo Park, CA; Research Triangle Park, NC; Washington, D
Slide 32: Future potential inflection points to unlock broad access to Galleri
Future potential inflection points to unlock broad access to Galleri Large US health plans Reimbursement with large commercial payors FDA approval following FDA approval of Galleri Enable MCED test to be broadly marketed Medicare Unlock for CMS and CMS-Medicare commercial payors to legislation make
Slide 33: Scientific background and clinical evidence
Scientific background and clinical evidence CONFIDENTIAL & PROPRIETARY 33
Slide 34: Tumors shed nucleic acids (cfDNA) carrying cancer-specific information into blood
Tumors shed nucleic acids (cfDNA) carrying cancer-specific information into blood NORMAL TISSUE CELLS Normal cfDNA shedding Tumor cfDNA shedding Plasma cfDNA Necrosis Apoptosis TUMOR TISSUE CELLS cfDNA: cell-free DNA. Corcoran R et al. N Engl J Med. 2018;379:1754-1765. Thierry A et al. Cancer Metast
Slide 35: Our targeted methylation panel is uniquely suited for detecting cancer
Our targeted methylation panel is uniquely suited for detecting cancer Many cancer hallmarks are identifiable via methylation signals; methylation also leaves fingerprints in cell differentiation, enabling identification of CSO Patterns of 5-methyl Cytosine are maintained during cell Evading divisio
Slide 36: Unbiased evaluation identified our targeted methylation approach
Unbiased evaluation identified our targeted methylation approach Targeted methylation achieved ≥10x better LOD vs whole genome methylation Clinical LODa: the cTAF where the probability of detecting a cancer signal was 50% Unbiased comparison of detection using many approaches Combining other approac
Slide 37: Multi-cancer early detection with Galleri
Multi-cancer early detection with Galleri Targeted methylation NGS-based assay and machine learning used to analyze cfDNA in a blood sample to detect cancer and predict cancer signal origin (CSO) Cancer signal detected Cancer signal origin prediction No cancer signal detected Targeted methylation Tu
Slide 38: CSO identification is critical feature in an MCED test
CSO identification is critical feature in an MCED test “The Panel believes that “An ideal tool for universal screening would...accurately predict tumor site to MCD tests should have a efficiently direct the diagnostic evaluation of those with a positive test result.” tissue-of-origin – Ahlquist 2018
Slide 39: Clinical evidence program designed to support regulatory approvals and reimbursement
Clinical evidence program designed to support regulatory approvals and reimbursement DISCOVERY & POST-PMA / REGISTRATION ENABLING CLINICAL VALIDATION REIMBURSEMENT SUPPORT CCGA 1 & 2 NHS-Galleri Galleri-Medicare • Unbiased discovery identified technology • RCT to demonstrate clinical utility • Valid
Slide 40: CCGA3 demonstrated ~68% sensitivity for detecting deadly early-stage cancers
CCGA3 demonstrated ~68% sensitivity for detecting deadly early- stage cancers with a low false positive rate 89% 0.5% False-positive CSO prediction accuracy3 • Detected cancer signal across >50 AJCC1 cancer types 67% rate 69% Stage I-III sensitivity for • 44% PPV (modeled)2 12 prespecified Stage II
Slide 41: Implementation data generally consistent with case-controlled studies
Implementation data generally consistent with case-controlled studies CCGA3 PATHFINDER Modeled PPV at 99.5% specificity: Observed PPV at 99.5% specificity: ~44% ~43% CCGA3 results, Annals of Oncology, June 2021 PATHFINDER results, The Lancet, October 2023 CONFIDENTIAL & PROPRIETARY 41
Slide 42: PATHFINDER: Galleri more than doubled the number of cancers identified
PATHFINDER: Galleri more than doubled the number of cancers identified when added to standard of care screening >2x cancers 71% Cancers detected have no routine screening available identified PPVs for: ~50% 43% Positive predictive value FIT2 1.2% LDCT3 3.8% Mammography4 4.4% MCED-detected No serious
Slide 43: cfDNA is advantageous for population-scale early detection
cfDNA is advantageous for population-scale early detection Higher tumor cfDNA levels MCED test using targeted tend to be associated methylation cfDNA-based cancer with more aggressive cancers detection preferentially detects more lethal cancers, which may help avoid overdiagnosis CONFIDENTIAL & PROP
Slide 44: Galleri is unlikely to contribute to over-diagnosis
Galleri is unlikely to contribute to over-diagnosis Undetected cancers had a better prognosis Stage I Stage II 1.00 1.00 Probability Survival 0.50 n=486 0.50 n=106 n=312 n=226 0.00 0.00 0 4 8 12 16 20 24 28 32 36 0 4 8 12 16 20 24 28 32 36 Time (Months) Time (Months) Stage III Stage IV 1.00 1.00 Pro
Slide 45: Ongoing registrational studies and real world evidence program
Ongoing registrational studies and real world evidence program CONFIDENTIAL & PROPRIETARY 45
Slide 46: Registrational studies progressing
Registrational studies progressing NHS-Galleri PATHFINDER 2 Randomized clinical trial in UK designed to Interventional multi-center study in U.S. health demonstrate clinical utility at population scale systems • Large study to confirm test performance • Large study to collect safety data in U.S. • E
Slide 47: NHS-Galleri: Assessing clinical utility of MCED test for population screening in the UK
NHS-Galleri: Assessing clinical utility of MCED test for population screening in the UK STUDY OBJECTIVES Support NHS long term • Randomized, controlled study evaluating implementation of Galleri alongside Fully ambition to catch 75% of existing screening enrolled in cancers at early stage • Particip
Slide 48: PATHFINDER 2: A multicenter study with returned results
PATHFINDER 2: A multicenter study with returned results in North American healthcare systems STUDY OBJECTIVES • Enrolling ~35k participants ≥50 years of age • Evaluating safety and performance of Galleri MCED test in eligible individuals for cancer screening • Assessing number/types of diagnostic pr
Slide 49: CMS is investing in Galleri testing for Medicare beneficiaries
Announced REACH study in November 2023 CMS is investing in Galleri testing for Medicare beneficiaries Medicare beneficiaries • Galleri-Medicare study to measure performance & outcomes in the US face the in large-scale real-world cohort highest unmet need for early cancer detection • First-of-its-kin
Slide 50: Real-world evidence is an important component of GRAIL's evidence collection
Real-world evidence is an important component of GRAIL’s evidence collection REACH (Galleri-Medicare study) • Understand real-world clinical impact of Galleri in Medicare population • Demonstrate commitment to underrepresented minority populations • Engage CMS in support of coverage for Galleri Clin
Slide 51: We are progressing our rolling modular PMA
We are progressing our rolling modular PMA MODULE 1: MODULE 2: MODULE 3: Submitted Submitted Submitted PMA submission MODULE 4 MODULE 5 MODULE 6 Final PMA submission anticipated in 1H 2026; ~12 month review period expected PMA: pre-market approval. CONFIDENTIAL & PROPRIETARY 51
Slide 52: Opportunity beyond asymptomatic screening
Opportunity beyond asymptomatic screening CONFIDENTIAL & PROPRIETARY 52
Slide 53: Symptomatic detection is a significant unmet need
SYMPTOMATIC DETECTION Symptomatic detection is a significant unmet need ~16M US PATIENTS/YEAR PRESENT WITH NON-SPECIFIC SYMPTOMS Many symptomatic patients are burdened with a prolonged diagnostic odyssey • >70% of patients with non-specific but concerning symptoms undergo imaging, scoping, biopsies,
Slide 54: SYMPLIFY: Strong results in a symptomatic patient population
SYMPTOMATIC DETECTION SYMPLIFY: Strong results in a symptomatic patient population OVERALL AND TRENDS BY DIAGNOSTIC PATHWAY 323 Cases for which MCED test detected a cancer signal 244 In whom cancer was diagnosed 98.4% Overall specificity • Sensitivity increased with increasing age 66.3% Overall sens
Slide 55: Product portfolio expanding across continuum of care
Product portfolio expanding across continuum of care SYMPTOMATIC DETECTION PRECISION ONCOLOGY Suspicion of Post-treatment Detection of Pre-treatment prognosis Clinical monitoring cancer prognosis (MRD) recurrence Product in development MRD/treatment response/longitudinal monitoring Research studies
Slide 56: Precision oncology demand is growing
PRECISION ONCOLOGY Precision oncology demand is growing Research Use Only (RUO) Clinical development Partnered with several leading oncology AstraZeneca strategic collaboration companies for CDx development First pilot project in 2020 Expanding existing research relationships to clinical studies Ena
Slide 57: GRAIL's methylation-based research platform is highly differentiated
PRECISION ONCOLOGY GRAIL’s methylation-based research platform is highly differentiated Technology advantages • Non-invasive test enables cancer detection, classification, and monitoring with limited plasma input and no tumor tissue; multi-cancer • 7–10-day clinical turnaround • Quantitative measure
Slide 58: Demonstrated utility in precision oncology
PRECISION ONCOLOGY Demonstrated utility in precision oncology Solid tumor prognosis, Heme prognosis, MRD Multi-cancer subtyping molecular response Munugalavadla, et al. Utility of ctDNA-based targeted methylation MRD assay for hematological malignancies. Cancer Res 1 April 2023. Bar, et al. Response
Slide 59: Customizable platform demonstrates clinically meaningful lung cancer risk stratification
PRECISION ONCOLOGY GRAIL’s customizable platform demonstrates clinically meaningful lung cancer risk stratification The Lung Prognosis Test performed prior to surgery exhibits clinically meaningful risk classification in clinical stage I lung adenocarcinoma Association Between Pre-surgical ctDNA Pos
Slide 60: Financial profile and inflection points
Financial profile and inflection points CONFIDENTIAL & PROPRIETARY 60
Slide 61: Financial profile
Financial profile Revenue Total Revenue $93M FY 2023: $93M, 68% growth year-over-year Q1 2024: $27M, 36% growth year-over-year Anticipated trend $56M Strong revenue growth to continue Reductions in COGS/test in medium-term Operating loss declining over time $9M Continued investments towards reimburs
Slide 62: Well capitalized to drive strategy
Well capitalized to drive strategy 2.5 years of cash funds through 2026+ Pro Forma Cash Fully funded 2023 Cash Burn Adjusted for cash-based LTI through major ~$1 billion $532M milestones: PMA filing 2024 U.S. Galleri Sales Projected Cash Burn 2H24* Full NHS Study Data ~$250 M 30-50% Growth * Estimat
Slide 63: MCED screening revenue to grow over time
MCED screening revenue to grow over time Screening Revenue Established commercial market leadership $75M >100M intended use population in U.S. and >180k potential implementation in UK Tests sold through March Newer version of Galleri will enable price 2024 reductions $40M Compliance with annual test
Slide 64: Precision oncology business diversifies our revenue
Precision oncology business diversifies our revenue Development Services Revenue Large number of oncology studies $18M Significant need to identify residual disease or recurrence early to inform treatment decisions >6k $16M Samples across multiple Pharma services partnerships generating partners pip
Slide 65: Gross margin expected to improve over time
Gross margin expected to improve over time Cost of Goods Sold Transition to automated platform expected in 2024 ~60% Target U.S. Volume-based efficiencies achieved over time gross margin* Ongoing development & technological advances to contribute to reductions over time *Standalone cost of goods wil
Slide 66: Product revenue mix expected to diversify over next few years
Product revenue mix expected to diversify over next few years GRAIL 2023A GRAIL 2028E Galleri - US Galleri - International Precision Oncology & Symptomatic Detection CONFIDENTIAL & PROPRIETARY 66
Slide 67: R&D costs decreasing as a % of revenues
R&D costs decreasing as a % of revenues Key drivers R&D Operating Expenses Completion of clinical studies Launch of automated platform 10-15% Target R&D as a % Continued investment in innovation & new of Revenue at scale product development 2023 Post-reimbursement 2028 Total Revenue R&D CONFIDENTIAL
Slide 68: SG&A costs become more efficient over time
SG&A costs become more efficient over time Key drivers SG&A Operating Expenses Build Galleri channels 25-30% Progress pre-reimbursement sales through Target S&M as a % of rev at focused initiatives scale 10-15% Salesforce expansions with regulatory approvals Target G&A as a % of rev at Pipeline prod
Slide 69: Multiple catalysts to drive value
Multiple catalysts to drive value International expansion Broad US & UK reimbursement Galleri FDA approval MCED legislation Potential NHS commercial Launch an pilot updated version of Galleri CONFIDENTIAL & PROPRIETARY 69
Slide 70: Detect cancer early, when it can be cured.
Detect cancer early, when it can be cured. CONFIDENTIAL & PROPRIETARY 70
Slide 71: Non-GAAP Measures
Non-GAAP Measures Overview Adjusted Gross Profit/(Loss) is a key performance measure that our management uses to assess our operational performance, as it represents the results of revenues and direct costs, which are key components of our operations. We believe that this non-GAAP financial measure
Slide 72: Non-GAAP Measures FY 2023
Non-GAAP Measures FY 2023 Non-GAAP Adjusted Gross Profit ($ in millions) FY 2023 FY 2022 Gross Loss $(95.6) $(116.4) Amortization of intangible assets 133.9 133.9 Stock-based compensation 1.9 0.9 Adjusted Gross Profit $40.2 $18.4 Non-GAAP EBITDA ($ in millions) FY 2023 FY 2022 Net Loss — GAAP $(1,46
Slide 73: Non-GAAP Measures Q1 2024
Non-GAAP Measures Q1 2024 Non-GAAP Adjusted Gross Profit ($ in millions) Q1 2024 Q1 2023 Gross Loss $(21.9) $(25.6) Amortization of intangible assets 33.5 33.5 Stock-based compensation 0.4 0.3 Adjusted Gross Profit $12.0 $8.2 Non-GAAP EBITDA ($ in millions) Q1 2024 Q1 2023 Net Loss — GAAP $(218.9) $