Good day and thank you for standing by. Welcome to the Burning Rock 2022 Q2 earnings conference call and webcast. At this time, all participants are in listen-only mode. After the speakers’ presentation, there will be a question and answer session. To ask a question during the session, you will need to slowly press star, one and then one on your telephone. You will then hear an automated message advising that your hand is raised. If you wish to ask a question via the webcast, please use the Q&A box available on the webcast link at any time during the conference. Before we begin, I’d like to remind you that this conference call contains forward-looking statements within the meaning of Section 21(e) of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as will, expects, anticipates, future, intends, plans, believes, estimates, target, confident, and similar statements. Statements that are not historical facts, including statements about Burning Rock’s beliefs and expectations, are forward-looking statements. Such statements are based upon management’s current expectations and current market and operating conditions and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond Burning Rock’s control. Forward-looking statements involve risks, uncertainties and other factors that could cause actual results to differ materially from those contained in such statements. Burning Rock does not undertake any obligation to update any forward-looking statements as a result of new information, future events or otherwise, except as required under applicable law. Please note that today’s conference call is being recorded. I would now like to hand over to your first speaker, Mr. Yusheng Han. Please go ahead, sir.

Thank you, and thanks for joining Burning Rock’s Q2 2022 conference call. I’m Yusheng Han, the CEO and Founder of Burning Rock. Today we have our COO, CTO and CFO in the meeting. We know that Q2 was really a hard time for most of the companies in China with completely locked down of Shanghai in April and May and a hard lockdown of Beijing in May. Despite these difficulties, we still recorded year-on-year increase in Q2 in terms of revenue. The growth was contributed by strong in-hospital revenue growth outside of Shanghai and Beijing, new product lines such as MRD products, and the pharma business. Let’s review our business outline and the progress, and our COO, Shannon will go through the development of our product lines, and after that our CFO, Leo will go through the financials. Let’s turn to Page 3. To get a basic introduction of Burning Rock, we started with therapy selection business in 2014 and have grown to be a market leader in this segment. The leading position has laid a good foundation and given us an advantages moving forward to new business of early detection, MRD and pharma collaborations. Let’s turn to Page 4, and this is for our business objectives in the future. Therapy selection is a segment that we have working for eight years. In the past years, our main goal for this segment is to expand market share in both in-hospital models and central lab models. The in-hospital model now is operating profit positive while central lab is [indiscernible]. Now we are strongly leaning our strategy to in-hospital model. We have set a clear call of making [indiscernible] profitable in 2023. [Indiscernible] new clinical utility evidence and the technology development demands mature [indiscernible] and personalized panels, therefore we initiated trials in…

Okay, thank you Yusheng. Now I’d like to move onto Page 8. First, I want to take a minute and reiterate the [indiscernible] of MRD tests on early stage patients as the establishment of different clinical utilities will ultimately drive the market growth. On this diagram, you can see that an early stage patient could go through neo-adjuvant and/or adjuvant therapies before and after surgery, and then hopefully a long [indiscernible] period afterwards. As we all know, the most well established MRD utility is the prognosis prediction, and multiple studies across different cancer types and different technology platforms have validated the strong and robust association between MRD status and the patient prognosis at both the landmark and the longitudinal time points. Such utility is marked as green on this diagram - you can see that they have been at different time points along the way. However, this prognosis utility itself is probably not strong enough to drive a very high penetration of MRD tests because it would be the kind of nice-to-have-but-so-what test, which is informative but not exactly actionable for clinicians. With that said, we are now starting to see more and more truly actionable utilities of MRD tests to evolve, which are the ones labeled red on this diagram. Among these utilities, the most important one and also, I think, the most immediate one is to differentiate low risk and high risk patients based on the landmark MRD right after surgery and to commence escalated or deescalated adjuvant therapy regimens. If clinical trials in the coming years can validate such MRD guided treatment selection strategies, then the penetration of MRD tests among early stage patients would become very, very significant. On Page 9 and Page 10 actually show two such examples in terms of what kind of results…

Great, thanks Shannon. Let’s move onto the financials, and we’ll start with Page 22. For the second quarter, as Yusheng mentioned earlier, we had two things going on. We had, number one, COVID impacts, and number two, our underlying growth momentum, so in the following two pages, we tried to separate the two factors to provide better clarity on our volume trends, underlying trends. In other words, we are trying to address the question that if we assume that COVID impact is eventually going to go away in China, what would our volume trends look like. First of all, a brief recap of COVID in China during the second quarter. It wreaked havoc in China - Shanghai was locked down for more than two months, there were multiple other large metropolitans that had been shut or had lockdowns. Beijing had school closures and partial lockdowns, and so frontline anecdotal peer data indicated that our industry was generally down in the second quarter and our peers generally down year-over-year on their volumes. If we look at our volume data, the in-hospital channel was heavily impacted as Shanghai was a large [indiscernible] for the in-hospital channel. Central lab held up okay, and this is supported by new products, particularly MRD. Then on Page 23, we provide further granularity on the trends over time and across different regions with varying COVID impacts. On the left, we see that for our central lab as MRD started to generate volumes [indiscernible] launch in March, it supported a better industry up-trend for our central lab channel through the second quarter, and we continued to see very good momentum on this MRD pick-up by the physician market in China. For in-hospital, as shown on the right-hand side, Shanghai and Beijing represent large markets for us, and these…

[Operator instructions] We have a question from the phone line. Please stand by. The question is coming from the line of Max Masucci from Cowen. Please ask your question, your line is open.

Hi, this is Stephanie on for Max. Thanks for taking my questions. To start off, Leo, can you speak to some of the key revenue drivers and any assumptions baked in for the second half this year? What gives you confidence in maintaining the full year 2022 guidance, and are there any potential sources of upside to keep in mind?

Yes, so when we made our guidance towards the start of this year, we did leave some buffer for COVID, and I would say that buffer was pretty much used up in the second quarter, so we were conservative to start with. If we don’t have any other COVID outbreaks going forward, and based on the underlying trends we are confident of our guidance, we saw a large drop in Shanghai and if those come back, we will get pent-up demand there. Apart from just getting back to normal from COVID, the underlying growth from pharma and from MRD from additional gains in the hospital are strong when there is no COVID impact, so I think COVID remains the number one factor but if we take that aside, we are still confident about the guidance that we have for the full year.

Got it, understood. That’s helpful. Then following the lockdowns, could you give us some more color on what Shanghai and Beijing currently look like? You mentioned some pent-up demand there. Any more color you can give on that as patients return to get tested, and then if you can share--do you mind sharing how much Shanghai and Beijing make up of your total revenue?

Yes, they make up--I mean, for the in-hospital, they make up the lion’s share, more than half of our in-hospital volumes. For the overall volume, they represent a significant portion, about a quarter roughly speaking, and we have seen improving trends over time but they’re not back to full normal yet. But if there is no further impact, we do expect patients to return, and a lot of patients go to Shanghai and Beijing from regions outside of Shanghai and Beijing, so if that travel can come back, there is volume that we have yet been able to catch up with, so that’s something to keep in watch. We provide in the presentation the latest reads into July and we will continue to try to provide as much clarity as possible going forward.

Got it, thanks for that color. If I could squeeze in one more, it’s great to hear the uptick of your MRD test following its launch in March, as well as the consensus view of MRD for lung cancer among Chinese physicians. When should we expect a similar consensus view for colorectal cancer, and are there any catalysts to keep in mind in the near to midterm that could further drive MRD adoption?

Yes, in terms of the consensus among the colorectal cancer, all that we can comment right now is that it’s being very actively discussed and there have been multiple conferences focused on MRD and how should the consensus be reached. I can’t predict precisely when the exact consensus is going to happen, but I can say that just the discussion itself has brought a lot of attention among the community, so we are pretty optimistic that the colorectal cancer community for the clinicians are going to have--going to catch up with the lung clinician community in terms of their awareness of the MRD usage. Then in the near future, I think the upcoming studies, for example the DYNAMIC, the CIRCULATE-Japan, so I think people aren’t anticipating the results from these interventional studies because people have been fully convinced about the prognosis prediction part of MRD, but now they are waiting to--they are waiting to see whether the MRD can resolve the ultimate so-what question. I think the CIRCULATE-Japan and DYNAMIC are very well designed studies to answer those questions, and so far the DYNAMIC results showing the MRD [indiscernible] from the study has been viewed as very promising and pretty exciting. I think in the next couple of years, these studies will have their readouts and if they continue to show positive results, it would be a very strong push for the community. Also, another potential factor is the pharmaceutical companies’ adoption of MRD to embed MRD into their drug investment studies, for example the MERMAID-1, MERMAID-2 study from AstraZeneca. I think those had MRD embedded in their design, and so the results from those trials would be very critical in terms of people’s view on the MRD utility [indiscernible].

Got it. Thanks so much, Shannon, for that color. Just one quick one on the guide, does your guidance contemplate the uptick in pharma revenues in the first half of this year, when you set that guidance range?

Yes, pharma has been on track or slightly beating our internal forecasts so far this year, so we’re happy about the progress there. It has been a strong factor in our outperformance across peers and the industry, but I would say that I think the visibility of that has been built already previously on the backlog, and that continues to build, so that should provide us with further runway going forward as well.

Got it, understood. Thanks so much for taking all my questions.

Thank you Stephanie.

We have no further questions at this time. I hand back to the conference to Leo. Thank you, please go ahead. End of Q&A:

Thanks everybody for attending our earnings call today, and if you have any questions, please do come back to us. Thanks very much for your time.

Ladies and gentlemen, this concludes today’s conference call. Thank you for participating. You may now disconnect your lines. Thank you.