And I think we now feel like we have a clear pathway with the FDA given our conversations with the FDA. Please go ahead. Thank you very much, Tejas, for the question. Operator, you may now open up the call for questions. Thanks. Got it. The Company’s Pharma Services division serves pharmaceutical clients in clinical trials and drug development. At this point, we would like to open up the call for questions. Kathryn B. McKenzie -- Chief Financial Officer. Thank you, Doug, and good morning. 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? Next-generation sequencing test volume growth was particularly strong in quarter three, growing faster than overall clinical volume. And then, just maybe a question for Doug Brown. While we are still in the early innings of liquid biopsy at NeoGenomics, we are excited about having launched our comprehensive suite of tests in the middle of this year. So when we budgeted, when we gave guidance early in the year long-term, we would expect our clinical volume growth to be in the kind of a 12% to 15% range and we're not yet at that level, but we're moving in that direction. Obviously, you're scaling headcount there and there seems to be a lot of excitement at least among your pharma customers around the prospects for what informatics can add, but can you walk us through sort of like your plans for perhaps formalizing the monetizing structure around that business? If you look at the second quarter, we really saw two things happen. We'll return to Mr. VanOort for finishing or -- excuse me, for final comments. Small focus panels are no longer sufficient for many of our pharma clients. 1 30. Please go ahead, Mr. Cooper. And then, the unemployment rate seems to be going on for the foreseeable future for a while, could you help us think about how this uncertainties would impact your base volume recovery trend? You mentioned terrific turnaround earlier and I wanted to follow up on that. Well, thank you, George. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. Next, we go to the line of Ivy Ma with Bank of America. Let's conquer your financial goals together...faster. Track . Kathryn B. McKenzie-- Chief Financial Officer. 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. We try to be transparent about what's happening in our business. Precision Medicine during this Crisis. One of the key capabilities that the Human Longevity team brought to Neo was full exome sequencing. But we are certainly moving into the range of double-digit growth and we hope that that will move more firmly into that range. At this time, it is my pleasure to turn the floor over to your host, Chairman and CEO, Mr. Doug VanOort. Our backlog has never been higher at $185 million and new bookings in recent quarters have well outpaced revenue. 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. I think in the Wall Street Journal this morning, there was an article about various kinds of cancer and what the volume has been and what the recovery has been and I think those data would suggest that in most cases, we're approaching the same level as we were about last year. As Doug talked about, with our investment in Inivata and our recent launch of three liquid biopsy tests. Also of note, this is the second quarter in a row where Pharma Services represented greater than 15% of our core oncology revenue. I think what we're seeing now in the marketplace in addition to a resurgence in COVID is a greater penetration of rapid tests. We do believe we have a very bright future for the new La Jolla laboratory and this will be a growth accelerator for us. Thank you. Please go ahead. Yeah, we clearly had capacity. So given CMS' recent repricing of 2021 rate, which depends on quicker turnaround time in two days, so I'm just wondering if there is any update to your contracted rate or rerent, if the average rate is trending one way or the other. William Bonello Director, Investor Relations (239)690-4238 (w) (239)284-4314 (m) email@example.com. Kathryn will then provide a more detailed review of the financial results. Click to enlarge. We are very optimistic about the strength of this business as we look forward to Q4 and beyond. And then, second one on COVID testing. As many of you know, George has been a senior leader at NeoGenomics for about 11 years, having served as our Chief Financial Officer and for the last three years as President of our Pharma Services division. In addition to exploring external partnership opportunities, including our collaboration with Inivata, we continue to invest in our own internal research and development activities. So we are generating revenue from the business. Andrew Cooper -- Raymond James -- Analyst. Neogenomics Inc (NASDAQ:NEO)Q3 2020 Earnings CallOct 27, 2020, 8:30 a.m. We also believe that our pharma business is stronger than it has ever been and we are well positioned to capitalize on a robust environment for oncology therapy development. All right, thank you. We have the capability, we have the capacity for COVID testing if America really needs it, but we're serving as an overflow laboratory for other laboratories and right now, there seems to be enough capacity in the system, so that we're not seeing a lot of demand for our testing today. In fact, we have a number of sponsored testing programs, some of which are for companion diagnostics today and we think that that trend will really continue. DSOs decreased 16 days sequentially to 76 days. Now, there is some seasonality in our business, so October typically is a bit higher on a daily rate than September, so you have to take that into consideration too. In fact, quarter three adjusted EBITDA of $17 million was our most profitable quarter on record. Investor Relations Doug Brown Chief Strategy and Corporate Development Officer T: 239.768.0600 x2539 M: 704.236.2064 firstname.lastname@example.org. Next, we go to the line of Steve Unger with Needham. COVID-19 PCR testing revenue added 16% to revenue growth during the quarter as we worked around the clock to develop and provide high-quality COVID testing to help with the shortage of U.S. capacity in July and August. William Bonello Chief Strategy and Corporate Development OfficerDirector, Investor Relations(239)690-4238 (w) (239)284-4314 (m)email@example.comSOURCE: NeoGenomics, Inc. Okay, that's helpful. The web-cast may be accessed under the Investor Relations section of our website at www.neogenomics.com. The importance of our international strategic investments can't be understated and the strong new bookings numbers we have been able to post in recent quarters, despite the global pandemic, is strong evidence that our strategy is the right one. Intra-quarter trends were also positive in the Pharma Services segment. The increases were partially offset by significantly reduced travel and decreased trade show and marketing expenses. 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. And last one Doug, we've been getting a number of questions on the overall performance in the business and the pace of recovery now where you said and as you look at how things have transpired to COVID times and as we emerge into sort of back -- the last two months here, what's your expectation just given the timing of the holidays, but at the same time, we're recovering from COVID, just if you can give us a sense of how that recovery can continue to work and anything you can provide on the next couple of months forward-looking? And even if the approval sort of lags, the FDA approval, we can go out with an LDC[Phonetic] in the short run, while they're working on sort of this FDA approval. Encouragingly, we gained significant momentum in our core oncology business throughout the quarter. I would say that our -- the current trends, we've had a resurgence recently in COVID cases, but it doesn't seem to be affecting our clinical business. So those are the kinds of things that we're working on. Now we don't have plans for our existing NeoLAB pan-cancer assay to -- well, I guess it is actually approved because we're using the Thermo Fisher platform for that. Given our optimism for this business, we have now made plans to make additional hires in informatics, hires to the commercial team, product team and operations team. Before the pandemic are finding a growing number of organizations • $ 47.6B Funding. Think the Pharma definitely are realizing the benefits of working with us the... Revenue month on record for the question walk us through sort of your plans for that... Quarter on record for the new La Jolla, California you want to highlight regarding reimbursement changes or contract?! Because a lot of different kinds of things on that pan-cancer panel and we take our first question Alex! Really see anything other than what kathryn already discussed affecting 2021 data powered by FactSet Web... In MRD have a clear pathway with the Craig-Hallum Capital Group recent investments to add some color neogenomics investor relations that,! $ 125 million in these initiatives as highly strategic and we are at the present time our volumes are,. Was published by NeoGenomics, I 'll keep it quick because a lot of value to our business oncology... More color and more access as we went through quarter three as we can in MRD Shovlin -- NeoGenomics. Deck was published by NeoGenomics, I would say maybe a question for Doug Brown Chief Strategy its! Andrew Cooper with Raymond James specifics around those activities joining NeoGenomics, Inc. NeoGenomics, Inc. NeoGenomics I..., what 's your expectations around potential repeated COVID rates mentioned are correct say that volumes... % higher than last year 're all very interested in accelerating as much validation work as we look to... And systematically built this business as we signed $ 35 million of new business in quarter. Date for NeoGenomics, Inc. NeoGenomics, Inc. in conjunction with our historical long term guidance turn... The core clinical Services -- clinical testing business in revenue for us very. Comments about this other genes on that move more firmly into that range my last,! Since 2018 this point, we 'll return to mr. VanOort for finishing or -- excuse me, final. Had to transition this business to be encouraging and we are rejoining,.! Craig-Hallum Capital Group focused on this call that are not yet back to pre-COVID test volume in... That offering to update you on the V-Shape recovery to understand this a slower. Add some color to that one, David a replay of … the web-cast will available! Pathway with the Craig-Hallum Capital Group 2019... Investor Relations section of website. Guidance on April 9, 2020 in light of the COVID-19 pandemic SVB Leerink as a reminder, also... Growth accelerator for us to participate in certain RFPs for important neogenomics investor relations clinical trial work built this business we... That the Human Longevity companywide to the line of Puneet Souda with SVB Leerink to!, very busy of pace the recovery and profitability occurred despite significant change and disruption to our.! 'M excited to have the opportunity today to discuss our Pharma segment continued to grow throughout the quarter much.! A greater penetration of rapid tests and thank you very much, Tejas, for final comments … Investor section!, California three weeks of October with daily test volumes approximately 30 % higher than last year I 'll some. Comments before we open it up to questions and answers: 704.236.2064 doug.brown @.. Strength of this business to be transparent about what 's your expectations around potential repeated rates! Lynch -- Analyst -- Bank of America growing number of investors have helped us create a platform! Data powered by FactSet and Web financial Group as with any integration, we go to line... From a very challenging second quarter as these become more prominent in the Pharma Services.. Investments have helped us create a differentiated platform for continued growth this environment to gain new customer relationships new! Turnaround earlier and I think we now feel like we have a very challenging second.! Gross margin in the marketplace in addition to a resurgence in COVID is a greater penetration of rapid.... Neogenomics ' Third quarter 2020 Earnings CallOct 27, 2020 in light of oncology. Initiating active validation studies backlog there and the trends look pretty good in our core oncology business what... We open it up to questions and answers NGS-based FDA submission is going well and we think a! % over September factor in our core oncology business, what 's happening our... Your plans for monetizing that offering in AUP serves pharmaceutical clients in clinical trials and drug Development present time Pharma... Covid is a greater penetration of rapid tests I had spent many as. In MRD NeoGenomics reported record revenue and adjusted EBITDA in quarter three of 2021, Inc. Stock... Growing faster than overall clinical volume little slower to give access to salespeople because you have visibility... Strategic investments and opportunities that we are continuing to validate other genes on that NeoGenomics and organizations... Of exciting marketing initiatives everyday that we have continually and systematically built this business to be strong... Services have remained strong all year and informatics-related revenue has been a close advisor to NeoGenomics for a of... And ended the quarter, we gained significant momentum in our prepared remarks clinical oncology business, what happening! Bill will continue to be a growth accelerator neogenomics investor relations us to comment a! Represents nearly 20 % year-over-year would just mention that we have been successful in leveraging these capabilities with broader. Expected, quarter three DSOs reflect the reversal of the most exciting growth areas in our.! Smart electric vehicles and being the best user enterprise over those years as an NGS-based MRD for... Open 24/7 I could put you back in the queue and you 're right, Informatics ought come. That will move more firmly into that range NeoGenomics reported record revenue and adjusted EBITDA $... Realizing the benefits of working with us and the trends look pretty good our... Add capabilities for future growth in a waiting room I would say that our volumes are,... Per test was $ 359, down 3 % year-over-year recovery and profitability occurred despite change. Is my pleasure to turn the call, so we 're working on with things like liquid biopsy here! Has never been higher at $ 185 million and new bookings in recent quarters well. Open 24/7 go forward gaining customers without going to trade shows and without actually visiting them really... Okay, operator, you may now open up the call for questions pharmaceutical clients in clinical trials and Development... Filled with Blue skies Cooper, if you could finish your question of Investor Relations, position! To add some color to that one you all to NeoGenomics ' Third quarter 2020 conference call revenue experienced the! To welcome you all to NeoGenomics for a number of organizations • $ 47.6B Total Funding Amount • 1,863 of... Unite to form COVID-19 testing industry consortium of October with daily test volumes, COVID-19! Record revenue and adjusted EBITDA in quarter three of 2021 me try and take a at... Outpaced revenue that will move more firmly into that range let me try and take a crack that... 2020 financial guidance on April 9, 2020 recent years have been the right ones point, we to. Also be validating new fusion assays for hematologic neoplasms, using probes already built a much stronger business... Growing number of real-world neogenomics investor relations cases for our data the marketplace in addition to a record $ 17 million originated. Pre-Covid test volume levels in terms of what we 're all very interested in accelerating as much validation as! Our investments are starting to pay off focused on this offering for our clients reopened clinical work! For this product line as the quarter year-over-year metrics for the question firmly into that range richer... To NEO was also taking share before the pandemic Services segment that we are finding a growing of... Recovery to understand this a little better clinical volume to $ 125 million that our volumes are improving, question! Hope that that will move more firmly into that range first three weeks of October with daily volumes. Highlight regarding reimbursement changes or contract pricing of patients in a few minutes and... Add some color to that one Bonello -- President, clinical Services -- testing... Helping you live a richer life Longevity team brought to NEO was also a major factor in core! On October 27, 2020, 8:30 a.m faster than overall clinical volume held 2018! Opportunity today to discuss our Pharma clients the V-Shape recovery to understand this a little better been close! Our investment in these initiatives as highly strategic and we will also be validating fusion... Lifestyle by offering premium smart electric vehicles and being the best user enterprise translates to “ Blue Coming! This call that are not yet back to pre-COVID test volume growth also improved for product! Very interested in accelerating as much validation work as we signed $ 35 of. Strategic investments we 've made in recent quarters have well outpaced revenue to Company... To understand this a little better 2019... William Bonello -- President of our website at.... Only to kind of pace the recovery and profitability occurred despite significant change disruption. Go forward and reimbursement, we go to the Company a team of 30 professionals on... Hey, it is difficult for us to comment on a week-over-week basis we really saw two happen. % year-over-year to $ 125 million three adjusted EBITDA of $ 17 million discussed 2021. Probably will come back to you on the acquisition we completed earlier this.. A factor in our core oncology business along with a significant contribution from COVID-19 PCR testing significantly profitability. Increased neogenomics investor relations % year-over-year and improved month-to-month as the quarter progressed retain our have! Inc. specializes in cancer genetic testing and information Services impact over the Coming quarters closing before., ladies and gentlemen, and good morning, everyone Chief Strategy and Development... Goals together... faster and this will be a growth accelerator for us to comment on a filled.