Exagen (XGN) Canaccord Genuity 44th Annual Growth Conference & Private Company Showcase 2024 summary

Market overview and technology differentiation

• Focuses on proprietary autoimmune diagnostic testing, primarily for rheumatologists addressing connective tissue diseases like lupus and rheumatoid arthritis.

• Utilizes cell-bound complement activation products (CB-CAPs) technology, which increases lupus diagnostic sensitivity from 45% to up to 80% when algorithmically validated.

• Addresses a large market, with 41 million Americans testing ANA positive and requiring further rheumatology evaluation.

Financial performance and operational improvements

• Achieved record revenue and average selling price (ASP) in Q2, with over $15 million in revenue and an 8% sequential volume growth.

• Adjusted EBITDA loss reduced to below $2 million for two consecutive quarters, down from $41 million two years ago.

• ASP improved by 44% over two years, now at $400, with a target of $500–$525.

• Margin expansion driven mainly by ASP gains and right-sizing of sales and R&D teams, not by COGS reductions.

Product enhancements and reimbursement strategy

• Launching new biomarkers for AVISE CTD in Q4, expected to further improve lupus and rheumatoid arthritis diagnostic sensitivity and drive financial performance.

• Enhancements use established CPT codes, with anticipated volume consistent with current AVISE CTD demand.

• Projected to achieve cash flow positivity within 12 months of enhancements' launch.

• Actively pursuing MolDX LCD coverage for proteomic assays, with transition from Noridian to MolDX jurisdiction.