Adaptive Biotechnologies Corporation Q2 FY2025 earnings call

• MRD business achieved profitability with approximately $2 million in positive adjusted EBITDA, MRD revenue grew 42% YOY driven by clinical volume growth. - Integrated clonoSEQ into Flatiron's OncoEMR, began processing on NovaSeq X. - NCCN guidelines update for multiple myeloma supported ID testing, driving volume. - MRD Pharma revenue up 20% YOY, with $5.5 million in milestones, 175 active global clinical trials and $218 million backlog. - MIDAS study in multiple myeloma, Veneto-STOP in CLL, and DLBCL studies showed clonoSEQ's utility. - Immune Medicine working on digital TCR-antigen prediction model, preclinical data package for T cell depletion program, and aiming for $25M-$30M cash burn target.

Total revenue was $58.9 million, with 85% coming from the MRD business and 15% from Immune Medicine. MRD revenue grew 42% year-over-year to $49.9 million, with clinical and pharma contributions of 65% and 35%, respectively. ClonoSEQ test volumes increased 37% to 25,321 tests delivered. MRD Pharma revenue grew 20% year-over-year, inclusive of $5.5 million in milestones. Immune Medicine revenue was $8.9 million, up 13% from a year ago. Sequencing gross margin was 64% for the quarter, an improvement of 14 percentage points year-over-year. The MRD business achieved positive adjusted EBITDA of $1.9 million, while Immune Medicine adjusted EBITDA loss improved 14% versus Q2 of last year.

• Raised full year MRD revenue guidance to $190M-$200M from $180M-$190M. - Reiterated total company operating expense guidance between $335M and $345M. - Lowered full year total company cash burn guidance to $45M-$55M from $50M-$60M. - Anticipate 35% growth in fiscal year 2025 volumes versus 2024, sequential growth in Q3 and Q4. - Expect MRD milestone revenue between $14M and $15M, up from $8M to $9M.

No major risks highlighted in the transcript

Q: On NCCN update for multiple myeloma, impact on ordering patterns.

A: Susan Bobulsky said NCCN update is a tailwind, helping deliver message on importance of ID testing, but not projecting specific volume increase by itself, but contributing to ongoing efforts, seeing accounts evaluating upfront ID testing protocols.

Q: On CHMP opinion for MRD as early endpoint in multiple myeloma, importance for pharma customers and OUS opportunity.

A: Susan Bobulsky said CHMP opinion was confirmation of pharma's belief, supports global acceptance of MRD as endpoint, OUS opportunity significant, especially in Europe, supported by CHMP's opinion.