Biodesix at 45th Annual William Blair Growth Stock Conference: Lung Health Focus

On Wednesday, 04 June 2025, Biodesix (NASDAQ:BDSX) presented at the 45th Annual William Blair Growth Stock Conference, highlighting its strategic focus on lung health diagnostics. The company, led by CEO Scott Hutton and CFO Robin Harper Cowie, emphasized its commitment to improving patient outcomes through personalized diagnostics. While the company reported strong revenue growth and maintained high gross margins, it also faced the challenge of expanding its market presence amid evolving industry guidelines.

Key Takeaways

• Biodesix reported a 21% year-over-year revenue growth, with a focus on lung health diagnostics.
• The company plans to expand its U.S. sales force to 95 representatives by year-end.
• Biodesix aims to achieve adjusted EBITDA breakeven in Q4 2025.
• The company revised its fiscal year revenue guidance to $80 million to $85 million.
• Anticipated inclusion in updated ACCP guidelines in 2025 is a major strategic goal.

Financial Results

• Q1 2024 Performance: Biodesix reported $18 million in revenue, marking a 21% increase year-over-year.
• Lung Diagnostic Tests: Revenue reached $16.3 million, an 18% increase from the previous year.
• Development Services: This segment saw a 61% growth year-over-year.
• Gross Margins: Maintained at industry-leading levels, just under 80%.
• Adjusted EBITDA: The company reiterated its guidance for breakeven by the end of the year.
• Fiscal Year Guidance: Revised to $80 million to $85 million in revenue.

Operational Updates

• Sales Force Expansion: Biodesix plans to have 95 sales representatives in the U.S. by year-end, focusing on primary care physicians who refer a significant portion of lung cancer patients.
• Product Development: The company is expanding the Veristrat test indications beyond lung cancer and collaborating with Memorial Sloan Kettering on prostate cancer diagnostics.
• Digital Diagnostics: Biodesix is advancing into digital diagnostics, hiring a head of radiomics from Vanderbilt.

Future Outlook

• 2025 Goals: Biodesix targets the inclusion of its tests in the ACCP guidelines and expects a transformative year with the publication of clinical data from the ALTITUDE and CLARIFY studies.
• R&D Day: Planned for the fall, this event will disclose more about the product development pipeline, including risk of recurrence/MRD tests and digital diagnostics initiatives.

Conclusion

For further details on Biodesix’s strategic initiatives and financial performance, please refer to the full transcript below.

Full transcript - 45th Annual William Blair Growth Stock Conference:

Andrew Brackman, Diagnostics Analyst, William Blair: Us on the second day of the William Blair Growth Stock Conference here in Chicago. If you don’t know me, I’m Andrew Brackman. I’m the diagnostics analyst here at William Blair that covers Biodesics. Today, we’re joined by the CEO, Scott Hutton CFO, Robin Harper Cowie. Format for today will be a presentation formal presentation in here, and then we’ll go to the breakout room, immediately after.

Lastly, I am required to tell you that for a full list of research disclosures, please visit WilliamBlair.com. With that, I’ll turn it over to Scott. Thanks, Scott.

Scott Hutton, CEO, Biodesics: Thank you, Andrew, and thank you, William Blair. It’s always a great opportunity to, to be here, and and we appreciate this. So as, Andrew said, Scott Hutton. I’m the CEO of Biodesics. I’m joined by, with my colleague, Robin Harper Cowie, the CFO.

If you’re not familiar with biodestics, I’ll give you a little bit of a background. So we’re a leading diagnostics company focused in lung health. Our mission is to transform patient care and improve outcomes through personalized diagnostics that are timely, accessible, and address immediate clinical need. You can see we envision a world where patient disease are conquered with the guidance of personalized diagnostics. We generate revenue from two distinct segments of the business.

One is our lung diagnostic test, and we’ll go into great detail of each of these. But here we have five on market tests, all with Medicare coverage. And then the complementary side of the business is our development services or more traditionally referred to as biopharmaceutical services. But we’ve expanded it because we’re working with a number of life science partners and academic research institutions also. We current we currently have the largest commercial Salesforce focused on pulmonology.

We recently disclosed that we’ll plan on having 95 sales reps in The United States by the end of the year. We have over 300 publications and presentations, and we’re proud to state that we’ve always been focused on a multimodal or multi omic approach. We most recently have, indicated that we’re going to start expanding into, digital diagnostics to complement our proteomic and genomic solutions. As I referenced earlier, we have five Medicare covered tests. Three of those have advanced diagnostic laboratory status.

We have over 20 New York State CLEP approvals for both genomic and proteomic solutions, and we have four tests in our pipeline. And I’ll discuss each of these in a little bit greater detail. In our most recent earnings call, we were proud to share that we have maintained our industry leading gross margins at just under 80%. We had 21% year over year growth, and we continue to reiterate that we’ll hit adjusted EBITDA breakeven in the fourth quarter of this year. I should also offer at the bottom there, you’ll notice we have two ninety seven teammates.

A couple weeks ago, we shared that for the second year in a row, we received a top workplace award. So we take great pride in this. Not only are we focused on positively impacting patients, but we’re trying to build not only the most unique but best culture that we can at BioDesics. We have two facilities or laboratories. The headquarters is in Lewisville, Colorado.

Here, is where we run our IQ long or treatment guidance portfolio of tests and all of our biopharmaceutical services. And then just outside of Kansas City, Kansas and DeSoto, we have a smaller laboratory and footprint where we run our Notify lung portfolio of tests. So let’s dive into the lung diagnostic, portfolio. Why lung? Many may ask, and and many may underappreciate.

Lung cancer is still the deadliest of all cancers in The United States. As you can see on this slide, nearly as many people will die of lung cancer as the next three cancers combined, prostate, breast, and colorectal. As you look around the room and you count the numbers, one in eighteen people will be diagnosed with lung cancer in their lifetime in The United States. And, unfortunately, it’s usually a a metastatic or late stage diagnosis, which has a pretty dire outcome and consequence. You can see here a five year survival for those diagnosed with metastatic lung cancer, six percent.

And currently, one in five deaths related to cancer in The United States are associated with lung cancer. So as much as we focus on lung cancer through smoking cessation programs, awareness, we still have a long way to go to make a big, big impact in this market. I’ve referenced our five tests. We really focus as a continuum of care, And we look at it and say, hey, we want to make the earliest impact with diagnosis and detection. And then we want to help physicians when it comes to treatment or therapy selection.

So these five tests here cover everything from lung nodule risk assessment to, again, treatment guidance, and we’ll go into each of these in greater detail now. We’ll start with Notify Lung, the first two tests on the left. So these are going to be pre cancer diagnosis. When you look at the guidelines that a pulmonologist will follow, you’re going to have patients that are found, incidentally or through a screening program. Unfortunately, in The United States, less than ten percent of screened eligible patients actually participate in a screening program.

So majority of these patients are found incidentally. And what that means is they’ve gone in for another reason or rationale, and something is identified as suspicious. So they need to follow-up on that. When they walk into a a pulmonologist’s office, pulmonologists will assess their risk of malignancy utilizing a handful of calculators and also their judgment. You can see here that the guidelines really clearly delineate that a greater than sixty five percent risk of malignancy intervene, move quickly, pull those patients in.

On the opposite end of the spectrum, for those very low risk, less than five percent, same thing. They know with a high level of confidence this patient is healthy, and they can take a wait and watch approach and support that with annual CT surveillance. Sadly and unfortunately, eighty percent of the patients that present reside in the middle category of low to moderate risk ranging from five to sixty five percent risk of malignancy. This, in the guidelines, it actually states that it’s open to physician judgment. So prior to launching our two tests, we conducted some research and said, what’s the literature tell us?

How are the physicians doing in their judgment? And what we found was that historically sixty two percent of patients that received a biopsy had a biopsy conducted on a benign nodule. And then the opposite extreme, up to the right here, seventeen percent of patients sent to CT surveillance actually had a malignancy. So you can see both over and under treatment of patients. The stats that we found and identified was nearly one in three patients that had a surgical intervention had a surgical intervention or a wedge resection done on a benign nodule.

So it really fits into those unnecessary expensive, procedures that that health care administrators are starting to focus on. Let me go back real quick. I wanna highlight here that the guidelines have not been updated in over ten years, and I think it’s critically important to appreciate, that the ACCP or the American College of Chest Physicians recently announced that they are updating guidelines. They’re fully expecting an update in ’25. The annual meeting, which is called CHEST, usually occurs in October, November.

So at the latest, we’re anticipating that that we could see guideline, updates roll out in and around that. And we’ll talk a little bit more about what we’ve done to ensure we’ve put ourselves in a good position for guideline inclusion. So you can see this similar workflow, and now you see where our two products fit in. These two tests are simple blood draw. Again, they’re run out of our DeSoto, Kansas laboratory, and they run-in sequence.

And so Notify CDT is your rule in test. Here, we’re identifying those patients with a likely malignant nodule. The complementary test NotifyXL2 will only be run on those patients that do not have a positive CDT. And so about fifteen percent of the time, we’re seeing a positive CDT. Or looking at it differently, about eighty five percent of the time, both tests are being run.

Again, we reference these two tests. They are two unique tests. You can see here NotifyCDT. Here we’re measuring seven autoantibodies on an ELISA platform. And this test has a 78% positive predictive value with a 98% specificity.

Because it’s a rule in test, that’s what matters most. We return this test result back within twenty four hours of receipt in our laboratory. Again, because we’re identifying those patients with a likely malignant nodule, time matters. So early detection and diagnosis is key and critical. Returning the those results in twenty four hours allows those physicians to then pull those patients forward to intervene, and address that, situation appropriately.

As I’ve stated, all of our tests have Medicare coverage with private payer coverage continuing to grow and increase on a monthly basis. The complementary test NotifyXL2 here, this is your rule out test. It is a multiomic test where we’re using a number of clinical factors in combination with two proteins that are measured on an LCMS platform. This test has a 98% negative predictive value with a 97% sensitivity. This test will return those results within four to five business days.

Again, because you’re ruling out cancer, time still matters. But within a week, we can return both test results confidently allowing physicians to know who do they intervene on and then who do they take a wait and watch approach. We currently have two studies, one ALTITUDE and the other CLARIFY. Talk a little bit about those. But as a data development company and the first mover status that we have as a company, it’s a responsibility on us to continue to demonstrate not only efficacy, but utility in this marketplace.

And so we’re proud to share that we have a very robust clinical data package. Here, we’ve listed out 15 of the more important and significant publications ranging from discovery to analytical validation, clinical validation, clinical utility. And more recently, can see we’ve started publishing a fair bit on health econ and outcomes data. I referenced Altitude and Clarify. Here, you can see that they’ll fit into the clinical utility category.

Altitude is a first of its kind for this physician group. It’s a randomized prospective study following the American Thoracic Society guidelines for study design. This study is being managed by a data safety management board, so the team and company are blinded to test results. We’re eager to continue to provide updates. And as we learn more from upcoming data safety management board reviews, we’ll share that publicly.

But as a first of its kind randomized prospective study, we fully anticipate and expect similar and consistent results that we’ve seen in the past. And, obviously, this puts us in a wonderful position for guideline inclusion. CLARIFI is the more recent study that we kicked off late last year. This is a retrospective chart review study. What’s unique about this is we have the ability now with our commercial successes to go back and actually do chart reviews and look at patient outcomes at one year and two year time points.

And so we now have over eight seventy patients enrolled in a very short period of time. This is also going to allow us to look at some real world considerations. One that we’ve shared and disclosed publicly is how does our test compare to the results from PET scans? In this patient population, what we know in working and collaborating with pulmonologists is every one of these patients receives a PET scan. Unfortunately, almost every one of them pops or lights up, and so they aren’t as useful as they should be.

But when you talk about an exceptionally expensive procedure, we think that we can demonstrate here that that I’m not gonna state that we’ll forego the need for a PET scan, but we can be complementary and add additional information to the clinical decision making. So more to come here. We are working towards an interim analysis or two for chest out of the CLARIFY study, and we’ll look forward to providing updates as we progress towards that meeting. This is a a new slide and something that we use commercially, and so we call this our clinical utility review tool. We have tracked every patient, and what you see here is a pretest risk of malignancy that the physician assigns and then a post test change.

And so the data is the same between both of these images on the left. You have a scatter plot, each one of those representing a patient, and the colors showing redistribution. And so what you see here on the left is a line at 65 and a line at five percent. Remember between the five and sixty five percent risk of malignancy is where test utility most applicable. And you can see how we’ve redistributed going all the way up to a ninety five percent risk of malignancy post test result.

On the right, this is a violin plot. It’s the same data, just showing it differently. And you can see, going back to that data that we had where physicians make utilizing their judgment and they make a decision, and they state that risk of malignancy is between five and sixty five. Our post test results start to show how you’re redistributing that post test risk of malignancy. What our sales team will utilize this tool for is going back in and doing clinical consults at each and every user, highlighting how decision making has changed.

And so we’re continually educating on the value of our test and how they can continue to implement it more broadly within their practice. You can see over a hundred thousand patients are now included in this database, and it is HIPAA compliant. But we’ll continue to build this data out. The nice part is is what we’ve shown is that it’s generalizable. Our initial clinical studies, we’ve maintained the same performance in a real world population.

And so, that’s what gives us confidence that the ALTERTUDE study in CLARIFI will continue to build upon this exceptionally strong data. We recently discussed an expansion and an evolution of our sales team. And so what we have is now we plan to have 50 different territories, or we’re calling them pods internally, anchored by a pulmonology sales consultant. We disclosed that we did a pilot in the second half of last year assessing the feasibility of calling on primary care physicians. And the rationale here was we knew that nearly fifty percent of this patient population never makes pulmonologist.

They’re they’re stuck in primary care, and there’s a number of reasons why they may be stuck. But with working through the referral patterns, we knew that we could help unlock this. The question for us was just when did we make that change, and when did we start to address this? Address this? Middle of last year, we had a number of pulmonologists that began doing it on their own.

And what I mean by that is they said, hey. We value the the test results, but we wanna push that out into our referral network so that those referral physicians know who to refer on, ultimately enriching my patient population as a pulmonologist. And so this is a better representation of highlighting what was and what we plan to do here. So the scary thing about primary care is there’s approximately 250,000 primary care physicians in The United States. We are clearly not planning on calling on 250,000 physicians.

So I can state that again. We are not calling on 250,000 physicians. By looking at claims data, what we’ve seen is eighty percent of those patients that are referred on and identified are done so out of about 14,000 primary care physicians. So it’s much more manageable and addressable, and it’s similar in size to the number of pulmonologists that we have in The United States. And so the goal here is to work with ordering pulmonologists, educating back into their referral pattern, providing support and utilization of our test.

The ideal way that this will work is a primary care physician now can see a more enriched population where a notify CDT positive patient is referred on. And those patients that have a positive notify XL2, meaning that it’s a benign nodule, can stay in primary care where an annual CT scan will provide additional guidance if there’s change or need to refer the patient on. We’ll continue to keep you updated here, but we’re excited. And some of those early accounts that started to do this, what they have shared with us is they’ve actually now seen a stage shift. And so by doing so, they’re getting to patients earlier.

They’re diagnosing more early stage lung can plan on publishing this data. And as they do, we’ll we’ll make that readily available to others. But that’s the ultimate goal. Early detection and diagnosis enables us to have a positive impact in this patient population. Now let’s shift to post cancer diagnosis where we have our IQ lung portfolio of products here providing treatment guidance to physicians.

We’ve stated how dire a lung cancer diagnosis can be. You can see that those patients diagnosed with advanced stage non small cell lung cancer have a median overall survival of ten point five months, not even making it to the one year anniversary of their diagnosis. Historical use of tissue testing can take close to one month to get those test results. So you’re either waiting one month to prescribe treatment or you’re foregoing those test results and providing a treatment plan in advance of receiving those results. So with blood based treatment options, we focus on turning those test results around within three to four days, informing physicians what’s the ideal treatment to place a patient on.

So for early stage lung cancer patients, we offer a targeted ddPCR panel where we’re focused on four genomic mutations associated with lung cancer in complement with our Veristret test, and I’ll talk about it here in a moment. And then for those advanced metastatic or recurrent patients, we offer a fifty two gene NGS panel to provide a broader view on what’s going on genomically. We think it’s critically important as a multiomic, multimodal company to see both the proteomic and the genomic side. Not only do we value what’s going on genomically and looking at how the cancer is acting and behaving, but we think it is equally as important to understand what’s going on with the patient’s immune system. And so I’ll start on the right here.

Verastrat is a proprietary test that we developed and launched. It is a proteomic test. And here we’re identifying a chronic inflammatory disease state. When we studied this in five thousand patients in our INSIGHT trial, what we’ve been able to highlight is we’re able to provide guidance to physicians as to when a patient’s immune system may become compromised. And what that ultimately would mean to them is it’s a failed treatment and it’s time to change, treatment approach.

And so this test can be ordered serially at multiple time points and provides wonderful insights as to when that treatment again is failing and or when the patient’s immune system has been subverted by the cancer. We talked a little bit about the Genistrat DDPCR test. You can see a 90 sensitivity, 100% specificity, and then the four tumor mutations that we’re focused on which are relevant for non small cell lung cancer. Again, a fifty two gene NGS panel, ninety five percent sensitivity, 100% specificity, and both these test results are returned within two to three days in comparison to the average twenty six days for tissue testing. Transitioning to our product pipeline, we stated that we have four tests currently in development.

Recently, we disclosed that we plan on merging our risk of recurrence and MRD efforts. And so by end of year, we plan on having a solution that can start being tested and utilized in the biopharmaceutical community in a research use only capacity. What makes this unique is we’re going to blend both the proteomic and genomics just like we have in our lung test prior. But the risk of recurrence test is something we discovered where we can identify those patients with the highest likelihood of recurrence before they have surgical resection. So when you really think of that going into a surgical resection, you know which patient has the highest likelihood of recurring so you can take a more aggressive approach in treating them.

And then we’ll support that and follow that with longitudinal testing on the MRD side. So we are planning a R and D day here in the fall. At that point in time, we’ll disclose much more in in what we’re doing here. But some recent presentations have been made at liquid biopsy meetings, two different meetings earlier this year with us and Memorial Sloan Kettering and the Bio Rad team. So more to follow there.

We talked about Verastrat. We are working on expanded indications for Verastrat in different disease states. And so the first here you can see Verastrat really focused on immunotherapies. What we have demonstrated is that Verastrat has the ability to identify those patients that will respond favorably to an immunotherapy and those patients that will not. And so we’ll continue to provide information here.

But this provides us opportunities to start to expand outside of lung. And you can see there’s value here with other solid tumor types. Anything that we’re doing outside of lung, we’re open to partnering and collaborating with others because we do not have plans to expand our sales force to anything outside of lung at this time. That’s really important when you see the next application for Veristrat And our partnership with Memorial Sloan Kettering and their biomarker team, which is led by Howard Shear, one of the leading prostate cancer physicians in the world, what we’ve done here is taken their their biobank and looked at a number of prostate cancer patients, especially those that were castrate resistant metastatic prostate cancer patients. And we’ve been able to highlight that we can identify those patients that’ll respond favorably to a hormone treatment and those that will not.

So very excited about that. And, again, here, we plan on working with Memorial Sloan Kettering and a number of companies and researchers on prostate cancer to ensure that this test gets in the right hands so that we can make a big, big impact in that patient population. And then more recently, we disclosed that we have begun expansion into digital diagnostics. I talked a little bit about this on our most recent earnings call. We have a number of opportunities to pull more data out of EMRs, out of radiologic exams and material that can better identify patients, can better pull patients forward.

But also it gives us the ability to improve test outcomes. And so, again, at that R and D day, we’ll provide greater detail. We did highlight that we have now added a head of radiomics, Doctor. Michael Kammer, who is most recently out of Vanderbilt. And so we’re excited to let him run, have him on the team.

And him and Gary Pastana are going make a wonderful partnership as we focus on that full platform of genomic to proteomic to radiomic solutions across lung disease. So, again, more to follow here on the Biodesics R and D Day in the fall. Developmental services. This meeting is really on the heels of ASCO here in Chicago, and so our biopharmaceutical engagement was really strong this week. This team continues to build a wonderful book of business.

We disclosed at the q one earnings call that we had $10,900,000 of contracted research, but not yet recognized revenue currently on the books. For the most part or directionally, that’ll be recognized over the next one to three years. But this team continues to build an exceptionally large book of business. We offer both proteomic and genomic solutions, and we look forward to expanding into the digital side once we have a solution there. When we look back at our broad portfolio of tests, what we find is our biopharmaceutical partners really look towards utilizing ddPCR and NGS in a number of research applications.

We also will be adding those product development pipeline tests to this. And so we’ll start increasing the research on those tests here in the coming months. So let’s talk a little bit about our q one performance, being mindful of time. So we disclosed $18,000,000 in revenue in the first quarter, growth of 21%. We continue to see strong growth across the portfolio.

The two sides of the business represented here, you can see $16,300,000 in revenue for our lung diagnostic test, which grew 18%. And as I mentioned, the exceptionally strong growth on the development services side with 61% growth. Gross margins, we’ve stated they’re industry leading. We’ve also disclosed we fully expect them to stay in the high 70s and hopefully can get to the 80% range. We have reiterated that we plan on getting to adjusted EBITDA breakeven by year end, And you can see the significant improvement that we continue to make and fully expect similar improvement as we progress through this year.

We most recently not only reiterated that we would get to adjusted EBITDA breakeven, but we revised our guidance to 80,000,000 to $85,000,000 for the fiscal year. So Robin and I are really excited to be here. We’re happy to meet with everybody today during one on ones. We think that 2025 is a transformative year. And as I state to the Biodesics team, there’s never been a better time to be a part of this team.

Not only do we have that responsibility to build a market, but we continue to do so by developing data. And what you’re going to see is those data development decisions that we’re providing physicians an opportunity to make will change a marketplace. And as we continue to publish with both Altitude and Clarify, we’ve created a pretty significant moat around the business, not only from an IP protection perspective, but the number of years that we have of of not only researching and learning. We’re gonna continue to apply those learnings and expand that product development pipeline. And then we’re mindful that one of the single greatest assets we have is the largest pulmonology focused Salesforce focusing on lung health, and we’ll continue to not only invest in them but leverage that team.

With that, thank you all for your time today. I really appreciate it, and we’ll look forward to meeting with you later.

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