Hello and welcome to today’s Guardant Health Q4 2021 Earnings Call. My name is Elliot and I will be coordinating your call today. [Operator Instructions] I would now like to hand over to our host, Carrie Mendivil, Investor Relations. Please go ahead.

Thank you. Earlier today, Guardant Health released financial results for the quarter and full year ended December 31, 2021. If you have not received this news release or if you would like to be added to the company’s distribution list please send an e-mail to investors@guardanthealth.com. Joining me today from Guardant are Helmy Eltoukhy, Co-CEO and AmirAli Talasaz, Co-CEO and Mike Bell, Chief Financial Officer. Before we begin, I’d like to remind you that management will make statements during this call that are forward-looking statements within the meaning of federal securities laws. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated. Additional information regarding these risks and uncertainties appears in the section entitled Forward-Looking Statements in the press release Guardant issued today. For a more complete list and description, please see the Risk Factors section of the company’s annual report on Form 10-K for the year ended December 31, 2021 and in its other filings with the Securities and Exchange Commission. This call will also include a discussion of certain financial measures that are not calculated in accordance with generally accepted accounting principles. Reconciliation to the most directly comparable GAAP financial measure may be found in today’s earnings release submitted to the SEC. Except as required by law, Guardant disclaims any intention or obligation to update or revise any financial projections or forward-looking statements, whether because of new information, future events or otherwise. This conference call contains time-sensitive information and is accurate only as of the live broadcast, February 23, 2022. With that, I’d like to turn the call over to Helmy.

Thanks, Carrie. Good afternoon and thank you for joining our fourth quarter and full year 2021 earnings call. I will start off today’s call by highlighting our progress across oncology as we continue to build on our strong position as the liquid biopsy leader. I will then turn the call over to AmirAli for an update on our screening program. And finally, Mike will provide a more detailed look at our financials and our outlook for 2022. Starting on Slide 3, 2021 was a significant year for Guardant. We launched a number of new products, surpassed 100 biopharma partners, reached target enrollment for our ECLIPSE study, started enrolling a second registrational grade study in lung cancer screening, continue to advance our technology platform and significantly scaled the organization as we prepare for future growth. Our mission at Guardant is to conquer cancer with data and ultimately transform cancer care. The driving force of our work is our commitment to putting patients first. We are dedicated to bringing the absolute best products to market that will continue providing clinically actionable information to inform patient care. Before I provide an update on our progress, I would like to start off with a patient story. In 2017, a 60-year-old man was diagnosed with Stage 2 rectal cancer. He quickly underwent surgery. But soon after surgery, his oncologist discovered the cancer had already spread to a lymph node. The patient immediately began chemotherapy. Fortunately, he responded well to treatment was considered to be cancer-free and transitioned to long-term follow-up care. This past summer, he was still feeling great and was due for a periodic checkup. His CT scan was normal. His CEA was within normal limits. So, the oncologist scheduled follow-up tests, including colonoscopy, CEA and the CT scan to be performed 6 months…

Thanks, Helmy. Turning to Slide 11, we are continuing to make great progress across our screening program. At Guardant, we have always believed that the blood-based screening test during wellness checkups has the potential to guard us against cancer. Blood-based screening is simple, reduces the need for patient follow-through, is much easier to integrate into health system workflows, expand accessibility to underserved communities and would likely improve the compliance to straining tests. For blood-based screening to save lives, we must offer a test with high sensitivity in detecting cancers at the early stages. In order to save lives at scale, patients need broad access to such tests, ensuring that access requires a reimbursement pathway and its strategy for inclusion into the screening testing guidelines, alignment with value-based care and the objective of health systems, and finally, FDA approval. For colorectal cancer, blood-based screening has an established Medicare and CD and FDA approval pathway. The utility of CRC screening is well-established and guidelines recommend screening in the vast majority of individuals over the age of 45. The benefit of screening has been limited due to the lack of compliance despite many efforts. Days of use of blood test holds great potential for increasing compliance. Turning to Slide 12, almost 2 years ago, we have started our pivotal registrational ECLIPSE study that we expect to read out in the middle of this year. Given that this is a registrational grade study, all data will be underlined at the same time. Although we have experienced some slowdown in our internal productivity as well as clinical site activities during the last few weeks due to a resurgence of COVID, at this time, we do not expect a material impact to our study timeline. We also expect to submit our PMA package to FDA in…

Thanks, AmirAli. Turning to Slide 16, starting with the fourth quarter of 2021, total revenue was $108.1 million, up 38% from $78.3 million in the prior year quarter. Total precision oncology testing revenue for the fourth quarter was $88.7 million with growth of 37% compared to $64.7 million in the prior year quarter. This increase was driven by strong growth in both clinical and biopharma sample volumes. Precision oncology revenue from clinical tests was $64.2 million, up 40% from $45.9 million for the prior year quarter. Fourth quarter clinical test volume was 25,600, which is an increase of 48% from the same period of the prior year. The blended clinical ASP for the fourth quarter of 2021 was approximately $2,500 in line with our expectations. Guardant360 ASP was between $2,600 and $2,700 consistent with the last couple of quarters. Importantly, the Medicare ADLT reimbursement rate of $5,000 for Guardant360 CDx which was initially set in April 2021 has been maintained at the same $5,000 rate for 2022 and 2023. As a result, we expect the ASP for Guardant360 to continue to be in the range of $2,600 to $2,700 during the course of 2022. We are seeing solid traction for our new clinical products: Reveal, Tissue Next and Response. And we expect volume from these products to continue to increase throughout the year. However, we don’t expect these new products to start to significantly contribute to revenue until we receive Medicare and private payer reimbursement. Therefore, whilst we expect Guardant360 ASP to be stable in 2022, the blended clinical ASP will be impacted as reimbursement of new products will take time to ramp up. Precision oncology revenue from biopharma tests in the fourth quarter totaled $24.5 million, up 30% from $18.8 million for the prior year quarter. Biopharma volume was…

Thank you. [Operator Instructions] Our first question comes from Tycho Peterson from JPMorgan. Please go ahead.

Thanks, guys. And maybe just first to clarify on the numbers, the ASP decline in the quarter was that just all a function of Reveal and Response kind of weighing down the average or was there something else there that you would point to?

Do you want to take that, Mike?

Yes, I can take that, Eltoukhy. Yes, that’s right. And it came down as we expected that G360 ASP was similar to previous quarters in this $2,600, $2,700 range. Yes, it’s new products with lower reimbursement, just bringing down that overall blended. So that was expected. We probably expect that to continue through 2022.

And the guidance at the high end, you’re coming in tad below the Street despite the foundation royalties, is that really just reflecting lingering COVID uncertainties? And anything you can say about clinical volume trends in the first quarter? And then also is the UK lab contribution embedded in guidance?

Yes. No, I’ll start, and maybe Mike can catch in. Yes, we feel very bullish about clinical volumes for 2022. We’re projecting 50% growth year-over-year, which is, I think, very strong and excellent to see. That being said, we did see some impact from Omicron in first part of first quarter, physician access was certainly limited. We’re seeing that begin to resolve very nicely. And so we’re hopeful that throughout the year that we will start seeing more positive trends in terms of really moving away from some of the negative impact of COVID. In terms of the UK lab, I think that’s still in its early days. So it’s not a significant contributor to this year. I would say that we’re projecting very strong growth in the precision oncology business, both in pharma volume samples and clinical samples. One of the challenges has been just the development services revenue. We’re just in a low, really, we have large projects ramping down and new large projects ramping up and we’re sort of in a trough in terms of – between those two stages. I don’t know if Mike there is anything else you want to add?

Okay.

No. I don’t think there is anything else for me, and I think you covered that all.

Okay.

Okay. And then, Helmy, lastly, just on pipeline, on smart liquid biopsy, are you able to kind of fine-tune time lines there and talk about what needs to happen ahead of the launch? And then similarly, on Reveal, can you just talk about reimbursement updates there?

Yes. So smart liquid biopsy, as is typical, we will launch that to biopharma initially. And that will be later in the year, we hope to present a lot more details about how that platform at our Investor Day in the fall. And then shortly thereafter, we will launch it to the clinical markets. But we’re very excited about that new platform, and we think that – and we’re very excited to share details around that. With Reveal, there has been some back and forth and we have submitted more information and we are still waiting for final feedback from [indiscernible].

Okay, thank you.

Yes. Thank you, Tycho.

Our next question comes from Brian Weinstein from William Blair. Please go ahead.

Hi, guys. Thanks for taking my questions. I guess starting out, you’ve talked about utilizing different types of technologies as you kind of build out your capabilities, especially around smart liquid biopsy, but I’m just curious about kind of more of a multimodal approach here. Can you talk about the importance of that and how you’re positioning yourself to move kind of beyond genomics? You made that AI imaging you were an investor in unit earlier. I’m just curious kind of you’re thinking longer term about bringing in other kinds of technologies.

AmirAli you want to take that.

Yes, sure. So Brian, actually, we are very excited with the bunch of take stack that we have at Guardant and some that we are working on that have talked about obviously yet. Yes, at Guardant, in general, we have this mentality that based on unmet clinical names figure out what are the technologies that you can use to really open up that unmet need in a very meaningful way and impactful way. That’s why like, for instance, on our epigenomic front, on ventilation. We have a novel assay like many other players in the field who are just using off-the-shelf reagents and hoping for the best. We never had that mentality, and we built a novel maturation assay on fragmentation side, again, on epigenomic front, I think we are second to none in terms of our performance there and contributions there that hopefully, over time, we would talk about the detail of how that technology stack works. Regarding radiology I, definitely, that’s something that we are working mainly with our partners. One of them is LUNAR that we talked about it before. And hopefully, like in near future, maybe in the fall Analyst Day that we are going to have, we can go over into some of these details more.

Great. And then on CRC, as that product gets launched. I’m just curious how you see that product over time playing out in terms of where volume comes from? Obviously, there is unscreened folks. There is colonoscopy, the stool DNA and then there is fit FOBT. I think you’re kind of leaning on the on-screen side, but I’m just curious kind of what the plan is there to really target those patients, especially seeing that most of those don’t really interact very much with the healthcare system potentially anyway. So how do you really go after the unscreened people? And where do you think your volumes will come from?

I think initially liking at that on the screen patient population and new to screening patient population, which what we mean by that the age of 45 to 49, to our total of about 40 million, 50 million of them that are in play. Really the unmet need is really big. In fact, a good fraction of them are actually in touch with the health system like when you just look at the people who say, yes, they want to get tested by stool-based kind of colorectal cancer screening devices at then they never submit their samples or basically, it’s really a lot of workflow just based on how much patients follow through is needed and really the patient preference of doing those kind of tests or not. So a bunch of them are, in fact, really are connected with the health system, and we feel very good about it. And I think really like as PCPs get experienced with our test and a close readouts comps. And they see really our superior performance that hopefully – we expect and hopefully ECLIPSE is going to confirmation for it. I think based on patient pre fronts, which is toward blood, a bunch of those testing as a potential to get covered a blood-based CRC screening. But we have to see, they have to see what the ECLIPSE out. It would be a the initial experience of the doctors with our blood test how that would be.

Okay, thank you so much.

We now turn to Tejas Savant from Morgan Stanley. Your line is open.

Hi, guys. Good evening. I’ll start talk with one on MRD and then switch to biopharma. So help me, can you share any sort of quantitative color on adoption so far? And what exactly is embedded into your guide for Reveal and Response? Is it fair to assume it’s contributing to volumes, but you’re not expecting much in terms of contribution to your clinical revenue this year?

Yes. So we continue to be very pleased with the progress around Reveal. We see very robust adoption of that project, I think the patient story that we mentioned, I think, shows some of the really exciting applications of that technology and how it’s having impact today. In terms of – I mean we’re not – for competitive reasons, we’re not necessarily breaking things out in terms of – into the individual products remain in the future, but we’re keeping that volume kind of aggregated at this point. I would say that in terms of revenue contribution, certainly the core products. Guardant360 are contributing the bulk of our clinical volume. We do have a risk-based approach in terms of our guidance in terms of the likely kind of puts and takes in terms of reimbursement. Obviously, private payer reimbursement on the reveal side will take much longer with Medicare being near-term. opportunity, we think with tissue, we think that’s also a near-term opportunity and response once again, I think, will be more similar to a deal.

Got it. That’s helpful. And one follow-up on pharma, are you seeing any impact from cancellations here in terms of your backlog? Or should we be expecting a more back-end loaded year in ‘22? And then on the Smart LB launch that you spoke about as being positioned for pharma customers, is it fair to expect that to essentially be a replacement for Omni on a go-forward basis at a similar price point or too early to tell?

Yes. So maybe I’ll start with a smart liquid biopsy and maybe Mike, you can speak to the first question. With smart liquid biopsy, we typically launch to biopharma initially, especially in the REVO setting. It allows us to fine-tune that test and really start, I think, important clinical collaborations around collecting data. So it’s really no different than other products that we’ve launched in the past. We do see it as segmenting our customer base between smart liquid biopsy on the Guardant360 CDx. And so we see it as another opportunity to really, I think, segment and provide a full gamut of tests for the entire spectrum of applications that biopharma will have. But certainly, smart liquid biopsy will be the future of Guardant360 at some point.

Maybe to add on the biopharma volume, we had a very strong closeout of the year, and we’ve seen that sort of healthy rebound in the second half of 2021. And we see that definitely flowing into 2022. We’ve not really been impacted by any cancellations or any real impact on the business. It’s always back-end loaded on the biopharma side. Q4 is always by far the strongest quarter. So although we are forecasting biopharma volume growth of greater than 30%, it will be back ended. So I think we will see sequentially lower volumes in Q1, and then that starts to ramp up throughout 2022, again, to get to that 30% plus growth on volume.

Very helpful. Thanks for the time guys. I appreciate that.

Thanks.

Our next question comes from Puneet Souda from SVB Leerink. Please go ahead.

Yes. Hi, thanks for taking the question. So first one on screening if I could ask? ECLIPSE, you mentioned is nearing enrollment completion of 13,000 with 12,750 enrolled already. Could you maybe just elaborate where colonoscopies stand? And do you feel still good about the – reaching the desired event rate for CRC that you want to have in this trial? Anything you can provide there, that would be helpful. And then a question that we get from investors is around advanced adenomas. How important are they in your view? And should we expect to see any data before the pivotal ECLIPSE readout?

Sure. Thanks, Puneet, for asking the question. So in terms of the 12,750 actually enrollment, we reached that at the middle of December now. So ECLIPSE is active. The patients are going through the colonoscopy additional patients are getting in through the whole workflow of the journey in terms of biopsies and diagnostic tests for the patients that colonoscopy find something in them and then staging, which typically involves some additional imaging to really figure out the stage of the disease. So, different patient population is in different phases of that journey. So far, we have over 10,000 colonoscopy reports. But even for the ones that we have colonoscopy reports, a bunch of them are going into the next phases of the diagnostic until we really get into the CRC identification and confirmation by the central pathology that we have. So, that’s why this thing takes a few more months and all-in, without going into a lot of details in terms of the timeline, still we are expecting that, hopefully, we are eminent ECLIPSE read out sometime around middle of this year, and we are excited to see what’s going to happen. Regarding advanced adenoma, we talked about it earlier, too, and it’s kind of interesting. When we look at the PCP market as of that, these verify our finding so far and mainly coming from a 300 physician survey that we have done. The differentiation of advance adenoma performance across different available tests there are not there still PCPs cannot really distinguish the fronts based on their performance and lot of focus is around CRC sensitivity. Having said that, in mid-term to long-term, I believe the advance adenoma performance would get a lot of – we are going to see a lot of detailing and messaging and education in the field that over mid to long-term, this could be a competitive kind of a factor still. It’s why we worked on the advanced adenoma development and data generation. In terms of timeline to put the data out there, the data that we have with our partners and collaborators, they are going to get published and presented in conferences, obviously. ECLIPSE readouts, which is basically, we have full control of disclosure of that data, the top line data whenever we have it, it’s going to get disclosed very quickly without any bonds linked to conferences, obviously. So, in terms of time line, we have to see, which one is going to be ahead. But I think that main data is going to be presented as part of ECLIPSE readout

Got it. Super helpful. And then just a quick follow-up on MRD and Reveal and recurrence monitoring, help me, what sort of data readouts we should be looking out for in terms of maybe larger patient size or other prospective trials or more actionability around the Reveal? And when can we get an early glimpse of the smart liquid biopsy performance? Thank you.

Yes. No, great questions. Obviously, we presented some updated data – some new data at ASCO GI recently, and we are very excited by that. We presented some data on breast at JPMorgan, and we are hopeful that we can present kind of a fuller analysis of that in the interim. So, I would say that those two trials, I think will continue to have data readouts throughout the year and the interim. There are other studies we are working on besides [Technical Difficulty] and COBRA and some of the largest studies that will likely read out over the next few quarters. So, it’s something where the engine is working, and we are hopeful that there will be a steady stream of data, not just across CRC, but other indications. I would imagine the smart liquid biopsy platform, probably the deepest and kind of most expensive maybe preview we would give that would probably be at our Investor Day in this fall.

Okay. Alright. Fabulous guys. Thanks.

Yes. Thank you.

We now turn to Derik De Bruin from Bank of America. Your line is open.

Hello. Good afternoon and thank you for taking my call. A couple of questions. I think the first one is on biopharma. Getting asked by investors about the competitive dynamic in that space, just because there is clearly a lot of companies that are going on there, trying to go into that market. Can you talk a little bit about how your partners are choosing Guardant? And are they running head-to-head trials with 360 and with Reveal and some of the other things like this? Just some of this like what gives a flavor of some of the studies that are going on in the competitive dynamic and there would be really helpful.

Yes. No, that’s a good question. I would say that for therapy selection market around 360 and OMNI, we are past that head-to-head phase. I mean that was a few years ago. And that’s an area that we do extremely well. I think if we don’t win, it’s largely because maybe someone’s broken the bank on their end in terms of cost or so on. So, we obviously want to keep our margins in line. We want to make sure that our costs and prices kind of remain stable. And so it’s not something we typically compromise on. And so yes, we feel like we have had excellent win rates there. We are working with over 100 biopharma companies now and growing. So, all the metrics we track are very positive. We don’t see much churn on the biopharma side. In terms of new products, we are often in that phase where pharma companies are doing head-to-head analyses. And we have also been very pleased with results of all the head-to-head studies that we have been a part of. And so we very much see it as the early days of Guardant360 and OMNI. And we are seeing interest from some of the newer areas we are working on, smart liquid biopsy and other products. And so we see that not only are exist – not only is the demand for existing products continuing to grow, even something like Guardant360 CDx is growing very nicely, and we are seeing more demand as that’s now an approved platform that sort of de-risked some of the analysis that can be done with that. But we are seeing really strong demand from new products that we are launching as well. So, we are very pleased with the breadth of portfolio and as it’s getting broader, we are seeing – we are able to create a stronger engagement and frankly, stronger moat around our relationships with biopharma clients.

Thanks for that. And just one other one, so just digging up some ancient history when we were doing the IPO in 2018, there was a lot of focus on lung during our discussions and then that shifted more to CRC for obvious reasons I guess what’s evolved and what’s changed in the lung assay. I mean you realized you have got a next-generation assay. But how has it sort of been enhanced? Is it with the new smart protocols? And also, there is another company out there that’s looking in the liquid biopsy space on lung cancer. I mean at first glance, they look like they are using perhaps some similar technologies, but any sort of like compare and contrast on what’s going on in the market and how that’s evolved over time would be really helpful? Thank you.

AmirAli, do you want to?

Yes, so in terms of the lung versus CRC question, it’s nearly around screening. So, the exciting thing is I think since 2016 that we started publicly talking about our non-air program, which is around our screening and MRD, we talked about multi-cancer kind of initiatives. And during those days, there were for cancers that I believe we started at the same time, colorectal cancer, lung cancer, breast cancer and ovarian cancer and a few other cancer types over the years got added in terms of understanding the biology and generating visibility data. Now, why CRC became our lead anchor indication is really because of other factors, including regulatory pathway now in fact, reimbursement pathway. And looking at it this way that once we have this FDA-approved CMS and Medicare covered has really our test is indicated for a vast majority of people at the age of 45 years or above. And that’s a very good actually anchor indication for us to really add other cancer types on top of that. So, that’s why I think CRC has become our anchor indication. But as you have seen, like we are adding lung. And throughout 2022, you are going to see the data from a few other cancer types. So, I think already in some conferences, we have shown data in pancreatic bladder, maybe a couple of other cancer types, but you are going to see more of those. So, it’s been really a multi-cancer screening journey for us with CRCs as our anchor lead indication.

We now turn to Max Masucci from Cowen and Company. Please go ahead.

Thanks for taking the question. First on MRD, do you have a rough idea or expectation of what the split will be between MRD monitoring clinical volumes coming from the adjuvant setting versus test used for cancer recurrence monitoring in 2022? And then how quickly do you expect that volume mix to shift in favor of cancer recurrence? Is that a 2023 event?

You mean just to kind of break it out like first kind of test after in the adjuvant setting versus test for monitoring that are subsequent to that first test?

Yes. Yes, exactly. So, just in 2022, what percentage of MRD monitoring volumes across all vendors will come from tests that are used on patients maybe in that six months adjuvant window versus those that are in remission and are using the test cancer recurrence?

Yes. We are still in the early days. And obviously, our call points is mostly to the oncologist. And so given that we are still ramping up very strongly, we are getting a lot of those initial time points. And so we think that throughout ‘22 and certainly into ‘23, majority of the tests will continue to be that initial time point. But we are seeing the strong growth in that sort of recurring testing stream as well. So, we are monitoring both sides, seeing that mix, and it’s something that I think we are very pleased with the progress. Well, I think over time to your point, one of the advantages of a blood-only test is really being able to access that prevalent population. If you think about the 15 million cancer survivors there are, the majority of them, 90% are more than a year out from their curative resection with an adjuvant kind of period. And so we see that as we continue to build our position that there is an enormous opportunity we have before us even as we build out our primary care franchise, for instance, on the screening side, there is really a lot of synergistic interplay we can have in terms of accessing that prevalent population, even in the primary care setting. So, we are very excited by kind of what the future holds for us.

Makes sense. And you have built a 100-plus person primary care sales team. It would be great to hear what sort of initiatives and responsibilities, the PCP sales reps have on their plate today? How much time and effort they are dedicating to the Guardant SHIELD LDT launch versus preparing for a broader rollout in 2023 after potential FDA approval?

Yes, sure. Actually, the team is now well on-boarded, well trained, a bunch of them got deployed to the field, setting the scheduling and maybe, in fact, started to happen, as I mentioned in the prepared remarks in terms of bringing awareness to blood-based cancer screening and getting the feedback from our targeted PC peers, in terms of the way we are looking at the market. And I can tell you that we are very pleased with a bunch of these early feedbacks that we are getting from the margin. In fact, many of them are waiting for Guardant SHIELD LDT to come live. Many of them already have patients in mind that if we were live, they want to start using the test. So, very encouraging for us, and it’s really contract bunch of assumptions that we had. So, the team is busy with tracking and getting this LDT launch as a very successful launch for us. And then they are going to actually expand their activities to support the IVD launch. But all the focus for us at this time would be a successful LDT launch in 2022 – in the first half of ‘22.

We now turn to Jack Meehan from Nephron Research. Please go ahead.

Thanks. I had a question for Mike. You talked about the investments going into the business. I was just hoping you could walk us maybe down the income statement, gross margin, R&D, sales and marketing, G&A, maybe just give some color on cost guidance for 2022.

Yes, sure, Jack. On gross margins, we always talk about this 60% to 70% sort of target. Target that we have for 2021, we were very successful though we had gross margins for the full year at about 67%. I think we will expect to see some pressures on gross margins in 2022, mainly coming from the fact that we have got new products, the volumes starting to ramp up, but it’s going to take time to get reimbursement. So, we probably expect the gross margins to be in the sort of the low-60s. And then on the OpEx side, again, yes, we talked about the investments on the prepared remarks earlier. We increased our OpEx about 70%, and this is non-GAAP OpEx, about 70% in 2021. And most of that growth was coming from R&D and in sales and marketing we made heavy investments there. I think when we look at 2022, that growth level is going to be lower. It’s probably going to be a growth of about 40%, and probably most of that growth will be on the commercial side. We hired roughly 100 people on the screening side of the business towards the end of last year. So, all of those expenses are going to flow into 2022. So, I think most of that growth will be coming on the sales and marketing side. And then on the research and development side, we are still pushing on that product portfolio and generating data and for oncology products and on the screening side of the business, continuing to develop the multi-cancer screening device. So again, we expect the OpEx to grow about 40% in 2022.

We now turn to Matt Sykes from Goldman Sachs. Please go ahead.

Hi. Thanks for squeezing me. I will just leave it to one question given time. Just on the community oncology market, just given the importance in your – to your clinical volumes, I think you mentioned that the commercial team is around 250. Just what are your plans in terms of growing that? Do you feel like you have got a good size right now to drive that volume growth? And then just on the 50% of interactions with oncologists that are in person, are there expectations that increases, or have some of the digital engagements that your reps have been doing could offset that if that sort of 50% level stays the same throughout the course of the year?

Yes. Good questions. I think we are hopeful that essentially that the 250 reps we have, I think there is still some room to grow in terms of really getting up to speed in terms of some of the new hirings we have made. Obviously, the access hasn’t been the best in terms of when those reps have come on. So, we see a lot of room to potentially grow as restrictions are lifted and access has opened up. We are hopeful that the – I know many of the pharma companies have sort of downsized some of their teams and are going to much more digital engagement, because this test – there is a lot more information behind it. There is a lot that we do to actually help support physicians, especially on the decision support side. So, we really see that as an opportunity for – and very close engagement with physicians. That being said, we are increasing our investments on the digital side. I think there is a lot of opportunities there that have opened up, not just where the technology has gone, but I think – physicians, I think are much more adept and more open to some of those engagement channels now. So, that’s definitely an area of opportunity for us and growth. The second part of the question?

Yes. Thank you.

Welcome. Bye-bye.

We now turn to Dan Leonard from Wells Fargo. Please go ahead.

Hi. Thank you. I was just hoping you could elaborate on the SHIELD LDT launch. How are you framing success if you are not planning for material revenue in 2022? And could there be more of a revenue opportunity than you framed? Another blood screening test is on the market with some healthy sales expectations for 2022. So, perhaps you could compare and contrast your opportunity. Thank you.

Yes, sure. So, our strategy for commercialization of SHIELD in general, LDT or down the road IVD is to go through classical routes of engagement with payers and securing reimbursement pathways in order to make sure we can go for the long-term win here, which is unlocking this $20 billion TAM and tens of millions of people need to really get access through our screening tests. So as a result, like in the early days, obviously, since we don’t have any coverage policies, any payments by payers, we expect very minimal kind of ASP, very, very low. And as a result, we cannot contribute materially in a meaningful way to the top line of Guardant’s revenue. The first major reimbursement that we are expecting and planning now is hopefully post FDA approval, would be Medicare coverage and after that hopefully followed up by Medicare Advantage and a bunch of early payers, would come on board following the Medicare decision. But that would be like in the post FDA approval, which, at this time, we are expecting in 2023 if that review goes well. So, that’s the main reason that in 2022 at this time, we are not projecting any material revenue contribution because of very low ASP.

We now turn to Patrick Donnelly from Citi. Please go ahead.

Hi guys. Thanks for squeezing me on here. Helmy, maybe one for you, just on the international side, I know you guys have laid a lot of groundwork there in Europe, you have the Japan JV. How should we think about that kind of building in ‘22, whether it’s a catalyst set or maybe even some volume build? What should we be keeping an eye on the international side as you guys continue to expand there?

Yes. No, great question. We are very excited about the progress we have made over the last couple of years. In Japan, I think we are nearing an important catalyst, which is regulatory approval of Guardant360. We are hopeful that will come in the coming months. And as we mentioned, it’s a very large market opportunity with 400,000 late-stage patients, reimbursement rates that are similar to reimbursement rates in the U.S. around comprehensive genomic profiling. So, we are building up that team and we are gearing up for, I think a very nice launch of that product. Given ramp times, it’s unlikely to be significant in ‘22, but I think it could be something very nice in ‘23 in terms of its contribution. In terms of Europe, we are also laying the groundwork there with two labs that should be up and running in the next 12 months or so in the UK and Spain. And we are very hopeful that in those partnerships, we can work together with those KOLs and academic centers to really secure public reimbursement once those labs are up and running. That will be a longer term event horizon, but it’s something that I think is a very nice setup for us to really do international the right way and hopefully in a way that really unlocks a significant revenue opportunity.

For our final question, we turn to Kyle Mikson from Canaccord Genuity. Please go ahead.

Hi. Thanks. So, I want to go back to SHIELD for lung though. So, let’s say you launched SHIELD for lung like a few years, presumably after the CRC launch, maybe you have reimbursement approval for CRC at that point. How do you envision like the two cancer assays faring in the market where you already have maybe 10 cancer, 50 cancer tests already kind of relatively established? And I just wanted to ask, do you think there is disadvantages to being one of the first market, and that can actually help your case?

Yes. So, we have an LDT route and an IVD route, so Guardant SHIELD LDT and Guardant SHIELD IVD after FDA approval. And you can expect that LDT device would have faster cycle of upgrades innovation behind it. And the Guardant SHIELD IVD is going to have basically longer time horizon for approval. For instance, in the case of lung, I expect we should be able to upgrade Guardant SHIELD LDT to include lung indication much, much faster than at the time that we have SHIELD LUNG readout for FDA submission and going through FDA review cycle to really upgrade that device that’s going to take a few years for us. So, similar story can get applied to other cancer types. A panel of cancer attacks can get added to the LDT device much faster than getting IVD claim for those cancer types. I hope that answered your question.

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