Ladies and gentlemen, thank you for standing by. Welcome to MDxHealth First Half 2020 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation.

[Operator Instructions] I must advise you that this conference is being recorded today, Wednesday, the 26 of August 2020. Before we begin, I am obliged to draw your attention to the forward-looking statement notice on the MDxHealth press release.

In summary, actual results and performance may turn out to materially differ and no representations as to the accuracy or obligations to updates are made in regard to forward-looking statements. I would now like to hand the call over to Michael McGarrity, Chief Executive Officer. Sir, thank you.

Thank you, Sherry. [Technical Difficulty] all for joining us for our 2020 half year release of results for MDxHealth. With me today is Ron Kalfus, Chief Financial Officer. Well, none of us could have anticipated how the first half of 2020 would play out, the MDx team has been and will continue to focus on the following.

Number one, maintaining our laboratory operations to the highest standards, while continuing to support the needs of our clinicians and, most importantly, patients. Number two, discipline and focus in building on the progress we have made in sales, revenue cycle management and capital allocation.

And number three, our employee wellbeing through rigorous and process based adherence to safety. It should be noted and as documented, that screening for all cancers is down materially in the U.S. over the past six months.

While prostate cancer is no exception, we expect that as all important patient access and flow returns, we will be well positioned to capitalize on the recovery.

However, even amidst the challenges presented by this environment, I am very confident in the fundamental drivers of our business that provided the basis for our optimistic outlook at the beginning of the year.

While our guidance has been appropriately suspended, pending better visibility to the rebound in patient visits and procedures in the US, we believe our results underscore our confidence and provide clear evidence of our restructured focus on commercial and operating execution.

Confirm MDx test volume and revenue, while down year-over-year, clearly exceeded trends in the oncology diagnostic sector. And continued demand through the first half of 2020 is additional evidence that our clinical pathway is beginning to be cemented into our Confirm MDx user base.

Our revenue cycle management execution is also clearly showing improved and sustainable results, even amidst the pandemic. Again, discipline, focus and leadership in this group, coupled with expanded coverage, will continue to drive leverage in our cash collections and associated operating efficiency.

Live test volume was affected by comparisons to some non-recurring volume in 2019, focus on ConfirmMDx in the back half of 2019, as well as to greater degree by the pandemic is expected, and mirrors more closely the industry trends related to screening and patient access limitations.

That said, we are very encouraged by the recent inclusion of SelectMDx into the National Comprehensive Cancer Network, also known as NCCN guidelines. This recognition of our SelectMDx test signifies the highest standard of acknowledgment for clinical utility in the diagnosis and treatment of prostate cancer.

We expect to see our volumes continue to normalize and return to growth as we go forward. Although the timing of the recovery will be subject to the dynamics well documented and characterized in the U.S. diagnostics market. We are already seen some elastic response to the previous easing of lifetime restrictions in the U.S.

and all this vary by geography and will likely continue to fluctuate and/or moderate through our acute period of the pandemic. We are confident that our customer base remains well intact, and that our volumes will recover likely led by ConfirmMDx with SelectMDx to follow.

Please be clear that in the interim, we remain connected to and encouraged by the engagement with our current, as well as pipeline customers that we are building through the efforts of our sales team.

While it is too early to characterize, we believe that there is a buildup of physician and patient interactions, and the easing of restrictions, patient and access, and the associated return of flow through our customer’s clinical pathway will accelerate and contribute to future growth.

I will comment further on our view going forward, but first, let me turn the call over to Ron to review our financial results for the first half.

Ron?.

Thank you, Mike. The pandemic has indeed presented challenges, not just for MDxHealth, but across the industry. While, we have experienced reductions in volume and associated revenue, we are beginning to see signs of recovery evidenced by a gradual increase in volume since the low point in late April.

Total revenue for the first half of 2020 was $9.9 million or reduction of 9%, compared to the first half of 2019, which we view as favorable compared to the broader industry downturn due to the pandemic. ConfirmMDx revenues, which represent over 90% of product revenue, were down only 2% versus the prior year.

Gross margins on product and services were 47.4% for the first half of 2020, as compared to 45.7%, for the same period in 2019, representing an improvement over 180 basis points.

Operating expenses in the first half of 2024 were $17.7 million, an improvement of $1.1 million or 6% over the same period last year, primarily the result of consistent and continued operating discipline.

Our cash balance at the end of the first half was $23.8 million strengthened by the equity investment of €12.7 million or approximately $14 million by MVM Partners, one of the highest quality healthcare investors in the U.S. and Europe.

Our total cash collections amounted to $11.5 million, a decrease of only 3% compared to last year, despite lower volumes due to the impact of COVID-19. Operating burn for the first half was $12.9 million compared to $14 million in the previous year, reflecting our strong operating discipline, and improved cash collections.

Turning the payer coverage, recall that in August 2019, Palmetto GBA, a Medicare Administrative Contractor that assesses molecular diagnostic technologies under it’s molecular diagnostic services or MolDX program issued a positive draft, Local Coverage Determination referred to as an LCD, recommending coverage for the SelectMDx test.

Following recent communications with Palmetto related to the requirement of the previously issued draft LCD. The company has been requested to submit and update to our technical assessment. We are currently engaged with the administrators, as well as our clinical advocates and key opinion leaders in prostate cancer.

And we'll provide updates as warranted and available. We are eager to address these questions and finalize the coverage by Medicare for our SelectMDx test as we did with ConfirmMDx. This concludes my brief overview of the results. And I will now turn the call back to Mike.

Mike?.

Thanks, Ron.

As we followed to Ron’s comments it is important to note that we remain absolutely certain of the clinical utility versus SelectMDx test is validated by market appetite and a significant body of clinical verification, validation and pre-reviewed data in both the U.S, and Europe, as well as its inclusion in both the all important guidelines of both the U.S., National Comprehensive Cancer Network and the European Neurology Association.

We believe that this foundation will allow for initiation of an expansion and coverage of our SelectMDx test. And while we cannot comment on current follow-up or timing with regard to Medicare, we are and will be advancing our efforts with commercial and private payers in the U.S.

In parallel, we will continue to drive the advancement of our broad and widely accepted coverage of ConfirmMDx test. Finally, I would like to communicate very clearly.

But over the last four quarters, our team has been singularly focused and dedicated to driving sustainable growth of our diagnostic menu of SelectMDx and ConfirmMDx to advance the diagnosis and treatment of prostate cancer. While the American Cancer Society estimates that there will be a 190,000 new prostate cancer cases in 2020.

It can also be the most confounding to screen for, detect, diagnose, and definitively treat. MDxHealth is the only company in the space to provide clinically actionable molecular diagnostic tests at multiple points in the pathway of these patients.

Not only do these aid clinicians to serve patients better by getting appropriate treatment and intervention, but when adopted drive cost savings and efficiency to both providers and payers from a healthcare economics perspective. This focus and associated execution leads me to constantly reiterate the phone.

We have clearly built a company uniquely capable of being the leader in the detection and treatment of prostate cancer. We have a body of scientific evidence of proven clinical utility in the market. We have a base of customers that can and will drive sustainable adoption of our menu with our improved focus, data, analytics, and sales talent.

And we have a team that will serve as the foundation of growth and value creation for all of our stakeholders, including patients, customers, employees, and shareholders. Thank you for your interest in support of MDxHealth. And I'll turn the call back over to Sherry if there are any questions.

Sherry?.

Operator:.

There are no questions. We will conclude the conference. Thank you everybody for your participation. You may disconnect your lines at this time..