Oncocyte Q2 Earnings Call Highlights

Oncocyte continues to target FDA marketing authorization for GraftAssureDx later this year. The FDA requested additional data and clarification, and the company plans to hold a Submission Issue Request meeting before resubmitting its package. Expanded Medicare reimbursement could support commercial adoption. New MolDX guidelines increase covered kidney-transplant rejection surveillance tests from eight to 14 during the first three post-transplant years, strengthening the case for in-house testing at transplant centers. Cash burn is expected to remain elevated as Oncocyte prepares for launch. Second-quarter cash burn was $10 million, while management forecasts roughly $8 million per quarter in the second half of the year due to regulatory, registry and launch-related spending.

Oncocyte NASDAQ: IMDX executives said they continue to target FDA marketing authorization for the GraftAssureDx kidney-transplant rejection test later this year, while preparing for a commercial launch and managing spending ahead of expected revenue growth. During the company’s second-quarter call, President and CEO Josh Riggs said the company received an additional information letter from the FDA in July as part of its Class II review. The agency requested additional data and clarification regarding the product’s intended use, he said. Riggs described the request as a normal part of the process and said the company has approximately tripled the number of samples collected for its study since the original submission in March.

Before submitting its next data package, the company plans to hold a Submission Issue Request, or SIR, meeting with the FDA. Riggs said the meeting is intended to provide direct written feedback on the company’s proposed response and ensure alignment with the agency before a resubmission. “We continue to target receipt of FDA marketing authorization later this year,” Riggs said, while noting that the timing of government review is outside the company’s full control.

Riggs said the FDA’s questions did not contain anything “terribly surprising” and appeared routine and addressable with data already available to the company. He declined to disclose the specific questions from the agency. Chief Science Officer Ekkehard Schütz also discussed the company’s plans for Europe. Following an informational meeting with its notified body, Schütz said the company received guidance on the In Vitro Diagnostic Regulation, or IVDR, process and remains focused on completing its submission during the second half of the year. Schütz said the European regulatory process appears more flexible than the FDA review and that the company does not currently anticipate needing to conduct large clinical studies for the submission. He added that self-certification in the United Kingdom is expected to be less burdensome. Riggs said the company is seeing early signs of market-access activity in Europe, including reimbursement progress in Switzerland and tenders in Italy. However, he characterized the European market as still being in its early stages and said broader adoption could be aided by approval of anti-CD38 therapies for routine use.

Management highlighted Medicare’s expanded reimbursement guidelines for transplant rejection testing as a potential commercial tailwind. Riggs cited the recent MolDX local coverage determination, which increased covered surveillance testing from eight to 14 tests during the first three years following a kidney transplant. The increased testing frequency could strengthen the economic case for transplant centers to perform donor-derived cell-free DNA, or d...