neogenomics investor relations
Yeah, I think what we've seen is obviously there are significant geographical differences as you look around the country on which markets were faster to reopen and others that were slower and you've seen that across the new cycles. While the lab was attractive to us the opportunity to add a talented molecular team was also a major factor in our purchase. Please go ahead. In our core oncology business, revenue grew 28% sequentially and 4% year-over-year. Yeah, so I think that the margin that you've seen over the last couple quarters was pretty indicative of what you would expect going forward. Kathryn B. McKenzie -- Chief Financial Officer. And then, just maybe a question for Doug Brown. Neogenomics Inc Q4 2019 ... William Bonello-- President of Informatics Division & Director of Investor Relations. I'd like to recognize the approximately 1,680 NeoGenomics team members around the world for their dedication and commitment to our company and to building a world-class oncology diagnostics program. Yeah, the recovery really was pretty broad-based and really did progress and strengthen as the quarter ended and is continuing to strengthen into October. And then, maybe just one last one. Investor Relations Careers. We are currently validating a new RNA-based fusion assay for solid tumors, employing state-of-the-art technology, which we believe will be superior to DNA-based assays. But I would say that we're very encouraged within that kind of environment by what's happening with the volume trends in both the clinical business and the pharma business and we're encouraged by what we're seeing, what we talked about for October and for quarter four. Also of note, this is the second quarter in a row where Pharma Services represented greater than 15% of our core oncology revenue. We feel great about our minority investment and will continue to monitor progress on the uptake of the InVisionFirst-Lung test and the development progress of the company's promising minimal residual disease or MRD pan-cancer monitored assay as we consider exercising our option to purchase Inivata. I don't want to belabor the macro point but I am getting questions on that, so I just wanted to maybe ask it different way. Informatics is now one of the most exciting growth areas in our Company. Mr. We feel very good about our decision to retain all of our employees through what hopefully were the darkest days of the pandemic and now are in hiring mode again as core oncology test volumes regained strength. NeoGenomics, Inc. specializes in cancer genetic testing and information services. I think what we're seeing now in the marketplace in addition to a resurgence in COVID is a greater penetration of rapid tests. Earlier this year, we significantly enhanced our marketing capabilities by hiring our new Chief Marketing Officer, who brings considerable pharma experience and precision medicine having led product launches for two novel cancer therapies. Our share in oncology really has pharma sponsors wanting to work with us and the great part of NeoGenomics too is we create optionality for them, so if they want to work with an IVD partner, they can, if they want to go to a single-site PMA, we can. How would you expect the COVID molecular testing revenue to change here in Q4 since you're seeing the increase of antigen tests in the market, I would expect that market -- the molecular markets get ahead of equilibrium at some point and thus, your businesses -- that COVID PCR business for you is going to have to come down at some point. Prior to joining NeoGenomics, I had spent many years as an external advisor to the company. Robert J. Shovlin-- … This lab is slated to be operational in 2021 and we are very excited about the growth potential in the Greater China market as well as our ability to support global clinical trials with activity in China. Sure, let me lead it off and then, I think maybe George and Rob each have comments about this. Well, I mean I would say maybe a couple of things on that one. Doug, heading into 2021, is there anything you want to highlight regarding reimbursement changes or contract pricing? The increases were partially offset by significantly reduced travel and decreased trade show and marketing expenses. One of the key capabilities that the Human Longevity team brought to Neo was full exome sequencing. Douglas M. VanOort -- Chairman and Chief Executive Officer. Learn more. Please go ahead. That's great. Okay, that's helpful, and then just one more. The webcast may be accessed under the Investor Relations section of our website at www.neogenomics.com. At this time, it is my pleasure to turn the floor over to your host, Chairman and CEO, Mr. Doug VanOort. Thank you, Doug, and good morning, everyone. An archive of the web-cast will be available until … 427 Number of Organizations • $47.6B Total Funding Amount • 1,863 Number of Investors. NeoGenomics is a cancer reference laboratory that provides cancer testing and partnership programs to pathologists and oncologists. Yeah, thanks for the question, Puneet. Thanks for all that color. We've got a very strong backlog there and the trends look pretty good in our Clinical business. Robert J. Shovlin -- President, Clinical Services Division. I will say this, that it appears that our hospital clients and our oncology clients have learned to sort of deal with an environment in which we're handling COVID. Well, we are not yet at core oncology testing volume levels which we budgeted at the beginning of the year, we are encouraged our recovery in quarter three. Pharma Services revenue increased 38% year-over-year to a record $17 million. So I really think if you look over to -- not Q2 per se, because Q2 was definitely impacted by the pandemic, but looking back at Q4 and Q1 of 2019 and 2020, more indicative of our short-term expectations was improvement from there. Just five years ago, we had essentially no Pharma Services business. The web-cast may be accessed under the Investor Relations section of our website at www.neogenomics.com. So we're seeing some good momentum there with more and more access as we went through quarter three into October. We look forward to providing quarterly updates on our progress. Now I'd like to introduce Doug Brown. While we anticipated that the acquisition would be a temporary drag on our gross margins in 2020, we remain very excited about our La Jolla business, which we've actually -- we're actually not calling Human Longevity anymore. Please go ahead. We are more confident everyday that we are on a steady path toward growth levels consistent with our historical long term guidance. We will also be validating new fusion assays for hematologic neoplasms, using probes already built into our current assay. So although our new customer acquisition activity is not what it will be and maybe what it has been, we're still gaining new customers and we're also gaining I think a bit of a share of wallet from the customers that we have because other competitors have the same problem, I mean they can't get into the customers either. No question, quarter three was operationally challenging as a result of the pandemic that we are all dealing with but overall, we are pleased with the company's performance. What we've seen as the markets have started to open more and more is our sales team seems to have easier access to hospitals and pathology groups, that seems to be an easier access point to get into the hospital away from where patients are consolidated and into the pathology suite for meetings. An archive of the web-cast will be available until … Okay, operator, I think we're going to wrap it up. DSOs decreased 16 days sequentially to 76 days. The Company provides one of the most comprehensive oncology-focused testing menus in the world for physicians to help them diagnose and treat cancer. The following slide deck was published by NeoGenomics, Inc. in conjunction with this event. Okay, got it. So in Pharma Services, we have a terrific pipeline of companion diagnostic projects, I think it's something like 40 different projects that we're working on and the list keeps growing, we have a lot of interest in that. The Singapore lab was opened in conjunction with our strategic alliance partner, PPD. Now I'd like to introduce George Cardoza. Overall, we believe that the strategic pharma investments that we have made in recent years have been the right ones. But we are certainly moving into the range of double-digit growth and we hope that that will move more firmly into that range. George A. Cardoza-- … You mentioned terrific turnaround earlier and I wanted to follow up on that. To-date, we haven't done a lot in terms of supporting basic clinical research, but we do think that is an opportunity as well. Hey guys, good morning. And then, a lot of moving parts on liquid biopsy screening tests, I mean you had GRAIL getting acquired by Illumina, Exact this morning acquiring Thrive, you had CMS coming out with some screening benchmarks. So we're looking forward to improved margins in those areas. Along with increasing our global laboratory footprint, we have been fortunate enough to identify and add incredible sales and management talent in Europe and Asia-Pac that are proving instrumental to our growth strategy. We remain on track for completion by quarter three of 2021. Our next question or comment comes from the line of David Westenberg with Guggenheim Securities. Yeah, the COVID testing business in revenue for us was very strong in July and August and then it did reduce somewhat. I'll now turn the call over to Kathryn McKenzie, our Chief Financial Officer, to discuss some of the details of quarter three financial results. While we are pleased by the sequential rebound in quarter three, we are also encouraged by the clear and continuing momentum we saw within the quarter in our core oncology business. I think the area that has strengthened the most has been next-generation sequencing as we mentioned in our prepared remarks. Thank you. As many of you know, Doug joined NeoGenomics in February as our Chief Strategy Officer and has recently also become responsible for Investor Relations. Yeah. The rebound in our core oncology business, which is somewhat V-Shaped in its trajectory occurred in both our Clinical and Pharma Services segments. Well, we lost the call, so we are rejoining, sorry. Hey guys, good morning. So when we're looking at our AUP now and how it could change with mix, from a margin perspective, this is a reminder, those higher priced tests also come with higher costs, and until we get broader coverage in reimbursement rate, you'll see a little bit of that pressure on our margins, but we are very encouraged by the efforts of our managed care and our commercial team that were working with the payers. Please go ahead. Well, thanks, Puneet. We also want to let everyone know that we're going to limit the number of questions to two per person in order to give more people a chance to ask questions within the one hour that has been allotted for this call. Maybe a bigger picture question on having a strategy in both Clinical Services and Pharma Services, I think companion diagnostics represents maybe a key synergy there. COVID-19. There is also an opportunity on the imaging front, there is significant interest in utilizing annotated digital images for training purposes and other research-related activities. This morning, I will begin by commenting on quarter three results including some encouraging market trends we are seeing in our core business, and then will provide a high level review of key strategic areas of investment. Finally, we soon hope to be developing a rapid AML NGS-based assay as well as an NGS-based MRD assay for AML. Small focus panels are no longer sufficient for many of our pharma clients. Kathryn B. McKenzie-- Vice President, Finance & Principal Accounting Officer. These statements by their nature, involve substantial risks and uncertainties, certain of which are beyond our control. Actually, we look at it day-by-day, but it is difficult for us to comment on a week-over-week basis. So we think that cancer diagnosis and therapy selection and monitoring are all obviously essential for cancer patients and there is a lot of postponement and delay in this activity and I think we're starting to see that come back and our volume, as we said, is reflecting that. The playback conference ID Number is 53846. Appreciate your time. We also now are getting interested not only because we can help in Pharma Services with the companion program, but also because we have the ability in our clinical division once the therapy is approved by the regulatory agency to flip it over and to help commercialize that assay and the therapy is relatively rapidly, because we have the test up and running. NeoGenomics (NEO) Investor Presentation - Slideshow. We'll return to Mr. VanOort for finishing or -- excuse me, for final comments. What is the goal I guess as far as gross margins for Pharma Services, especially considering the implications of the informatics business, I assume that that's a higher revenue or a higher gross margin revenue stream? Human Longevity built a beautiful lab in La Jolla and invested in a broad range of molecular technology, including an impressive display of next-generation sequencing horsepower with a focus on whole exome sequencing. Great. Okay, thanks, Doug. In the Pharma Services segment, the rebound we experienced in quarter three was driven by a momentum shift and strengthening as clinical trial activity began to resume. Doug has been a close advisor to NeoGenomics for a number of years and is adding a lot of value to our strategic process. The majority of our clients reopened clinical trial sites and revenue from clinical trials accelerated nicely as the quarter ended. In our clinical oncology business, revenue improved to 28% compared with last quarter to approximately the same level as last year, despite a very challenging environment. An archive of the web-cast will be available until … And then, second one on COVID testing. Got it. Investor Relations Doug Brown Chief Strategy and Corporate Development Officer T: 239.768.0600 x2539 M: 704.236.2064 firstname.lastname@example.org. Kathryn B. McKenzie-- Chief Financial Officer. We're expecting quarter four to be quite strong in pharma. In our clinical oncology business, test volume improved throughout the quarter as average daily test volume increased nearly 10% from the month of July to September. The presentation will be webcast live and accessible online via the investors section of the Company's website, www.neogenomics.com. George A. Cardoza-- President, Pharma Services. I'll make some closing comments before we open it up to questions and answers. Appreciate the time this morning. So what we saw the existing trials come back but unlike the second quarter, literally in July for the first time, we started getting first patients in on a few trials and that continued into July and really sort of continued on into August and September. Well, we have a very good collaborative relationship with Inivata, we serve on their Board, we have a minority interest, as you know, our teams are working very, very well together and we talk a lot of that both the InVisionFirst-Lung test and how to accelerate progress and penetration on that as well as MRD. I just want to talk in the broader market here for cancer testing, you were flat year-over-year in Q3 for the clinical cancer business. Kathryn will then provide a more detailed review of the financial results. Okay. A replay of … Thank you. 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