Castle Biosciences (CSTL) KeyBanc Annual Health Care Forum 2025 summary

Industry trends and reimbursement

• Greater clarity in CMS reimbursement timing for new diagnostics, with MolDX providing a clearer pathway.

• Commercial reimbursement remains inconsistent, with state biomarker laws not always enforced, but some positive changes seen in 2024.

• Expectation for more consistent commercial plan adherence to biomarker laws in the next 3-4 years.

• Profitability remains a balance between R&D investment and achieving reimbursement and adoption.

• Only a few firms have reached cash-generating scale, enabling reinvestment in growth and new products.

Strategic focus and product pipeline

• Capital is allocated across commercial expansion, internal pipeline development, and acquisitions.

• Recent acquisitions, like TissueCypher, targeted validated, reimbursed products with strong demand.

• Internal pipeline includes a test for atopic dermatitis to guide systemic therapy selection.

• Ongoing strategy is to balance commercial, pipeline, and acquisition investments.

Product performance and adoption

• TissueCypher addresses unmet need in Barrett’s esophagus, identifying high-risk non-dysplastic patients for earlier intervention.

• Strong adoption of TissueCypher driven by clinical education and unmet need.

• DecisionDx-Melanoma saw rapid growth in 2024, with market penetration at 28-30% and a goal to reach 55-65% over the next decade.

• Evidence of improved patient outcomes is driving increased commercial coverage.