Castle Biosciences at Leerink Conference: Strategic Shift Amid Challenges

On Monday, 10 March 2025, Castle Biosciences (NASDAQ: CSTL) participated in the Leerink Global Healthcare Conference 2025, presenting a strategic shift in focus amid reimbursement challenges. The company highlighted growth areas and financial resilience, despite setbacks with its squamous cell carcinoma (SCC) test. Castle Biosciences is concentrating on DecisionDX-Melanoma and TissueCypher, aiming for continued revenue growth and operational efficiency.

Key Takeaways

• Castle Biosciences’ revenue increased from $32 million in 2018 to $322 million last year.
• The company expects base business growth, excluding SCC, in the mid to upper teens to 20% year-over-year.
• TissueCypher’s market penetration is currently at 5%, with significant growth potential.
• Adjusted gross margins are anticipated to drop to the low to mid-70s due to SCC coverage loss.
• The company aims to be operating cash flow positive or adjusted EBITDA positive in 2025, even without SCC revenue.

Financial Results

• Revenue increased tenfold over six years, reaching $322 million last year.
• Base business growth, excluding SCC, is expected to continue in the mid to upper teens to 20% annually.
• The company targets a 20% to 25% EBITDA P&L in the near term.
• Adjusted gross margins are expected to be in the low to mid-70s, impacted by the loss of SCC coverage and lower margins from TissueCypher.

Operational Updates

• TissueCypher sales force expanded from 24 to approximately 65 representatives by Q1 2025.
• Castle Biosciences acquired 1,800 new melanoma ordering physicians in the last year.
• SCC coverage is set to end in April 2024, prompting a strategic shift to focus on melanoma.
• The company is exploring growth opportunities through private equity GI roll-ups and potential M&A.

Future Outlook

• Castle Biosciences plans to pursue SCC coverage reconsideration, which may take up to two years.
• The focus is on increasing TissueCypher penetration to reach melanoma levels, potentially becoming a $300 million product.
• The company remains confident in achieving positive cash flow in 2025, even without SCC revenue.
• Potential acquisitions in the GI space are being considered, though there is no immediate pressure to close deals.

Q&A Highlights

• The loss of SCC coverage is expected to lower adjusted gross margins to the low to mid-70s.
• Despite a mature market, there is still potential for growth in melanoma through increased penetration.
• ID Genetics is being deemphasized due to market and reimbursement challenges.
• Castle Biosciences is committed to maintaining financial discipline and strategic resource allocation.

For more detailed insights, readers are encouraged to refer to the full transcript.

Full transcript - Leerink Global Healthcare Conference 2025:

Puneet Sada, Host, Lyric: Great. Okay.

Thank you. So I’m Puneet Sada. I cover life science tools and diagnostics here at Lyric. And, it’s my pleasure to be hosting, Frank Stokes, the CFO of Castle BioSciences. Frank, glad to have you here.

Thanks for Thanks

Frank Stokes, CFO, Castle BioSciences: for having us in.

Puneet Sada, Host, Lyric: Yeah. Thank you. All right. So, as I was looking through, you know, some of the key topics for discussion, I mean, I kind of wanted I realized I want to go back to sort of, in 2018, you had the IPO and I’ve been covering the stock since then or you had at that time, Decision DX was an important growth driver to some extent it still is. Your wheel was flat and I think it still is.

And then you added ID Genetics in mental health, Surdonostics acquisition that added tissue cipher and then you launched SCC as well. So again, the number of tests and the menu expanded. But since then, we have seen contraction in SCC, reimbursement challenges, ID Genetics. I believe you said you’re going to be deemphasizing that. So we’re back to focusing on sort of three products, maybe X MyPath product.

So within when we look at the portfolio that you have, maybe a high level question I’ll start here with is, what’s the growth assumption that investors ought to have ex SEC and ex ID Genetics for this portfolio? And great to see Tissue Cyphr doing well, but could that accelerate in could the entire portfolio accelerate in 2026 and 2027?

Frank Stokes, CFO, Castle BioSciences: Sure. So I’ll give you another metric there. The year you referenced, we did $32,000,000 of revenue. And I think last year, we reported $3,220,000 10x in six years. So if we’ve been pitching that on the road, it would have been a little tougher story, a tough credibility.

So I think that ex SCC, so taking out our squamous cell carcinoma of the skin test, for twenty five percent, we see the base business. Our guide suggests the base business grows mid teens to upper teens to 20% over year over year, 24% to 25%. And we expect similar growth from 25% to 26%. We would think we would see melanoma growing mid to high single digits on a volume basis. And we’ll see some modest ASP improvement, nothing stepwise.

It will be iterative and we would like to hope slow and steady, but it will be iterative and a grind more than a stepwise jump. And then Tissue Cyphers, the bulk of that growth, it would be great to grow Tissue Cypher the same percent we grew 23% to 24%, but we’ve doubled the denominator. So that makes it harder. And we’ve also expanded the sales force. So just to help with the track, the trajectory there, we were this time last year, we had 24 sales reps in our tissue cipher division.

April one of ’twenty four, we went to 40. And what we’ve said is that by the end of this quarter, Q1 of ’twenty five, we would expect that group to be around 65 people. And what we’ve said since is that we certainly will or have hit it. So, we’re in that zip code now. So we’ve effectively on a weighted basis more than doubled the tissue cipher sales force from 24% to 25%.

So the market is large. We’re only about 5% penetrated. We’ve expanded the reach of the sales force. So we should see the same type of growth volume, nominal volumes, which would suggest pretty significant growth there. That’s an aggressive assumption.

It’s a little bit makes you a little anxious to think about seeing that kind of growth. But at the same time, the pieces are in place to do it. And so we’re still pushing hard on the TC test.

Puneet Sada, Host, Lyric: Got it. No, that’s a perfect segue into my sort of question around, can you talk to us some of the drivers of the tissue cipher growth? Once you said, obviously, penetration is low. But when we think about guidelines and then if you could touch on as well beyond volume growth ASP as well, what are some of those that can drive meaningful growth here?

Frank Stokes, CFO, Castle BioSciences: Sure. So we think for last year, we tested about five percent of the population. When we were first looking at Sernostics and at the test, we thought there were two hundred and eighty thousand surveillance upper endoscopies done a year. And that’s the patient basis as patients who are in for a surveillance upper endoscopy for Barrett’s. We now have good data that it’s more than four hundred thousand.

And so, we missed I’m glad we missed low and not high. I’m glad we didn’t overestimate. And so, one, the market is bigger. Two, when we’re doing an acquisition like that, we did a lot of work with physicians, a lot of interviews, a lot of surveys. And we had to really describe a patient fact pattern and a solution because the test was unknown.

We couldn’t say, hey, what do you think of tissue cipher? Because nobody knew anything about it because it hadn’t been effectively marketed. So we had to create a fact pattern, create a patient scenario, create a solution. What do you think? Would this be helpful?

And the feedback we got was really enthusiastic. And so that’s encouraging. But on the other hand, as you get to market, you’re anxious. Was that was it accurate? Did we cherry pick?

Did we adequately describe the scenario? And what we found is the response from physicians has been as enthusiastic as we thought it would be and hoped it would be when we were doing our diligence work. So we’ve got a bigger market than we thought we had. We’ve got the receptivity that we maybe had hoped we would have. And we’ve got a nice clear runway ahead of us.

So I think that in terms of driving that market, what’s fun to think about is if we could get Tissue Cipher to the penetration of melanoma, that’s a $300,000,000 product by itself. That’s almost as big as the whole company right now. So that’s the opportunity with Tissue Cipher. And that’s why we’ve invested fairly aggressively in this sales expansion here. And so the reimbursement rates or the ASP for the year, we would expect to be pretty steady this year.

We’re still early in the we’re early in the development or the cycle with commercial payers. We have some wind at the back. Primarily, most commercial payers will pay for ablation for almost any patient whose physician wants to have it done. They’ll happily pay for it. The patient reality there is that, Barrett’s can proceed to esophageal cancer, which has a five eighty five percent five year mortality rate.

So if you get that diagnosis, you got eighty five percent chance of not being around in five years. And it’s a tough five years. They’ll go in and they’ll remove part of the esophagus, which means a patient can’t recline for the rest of their life. They have to sleep at 45 degrees. There’s all kinds of lifestyle issues.

It’s a tough five years. And then as I said, eighty five percent of the time, it’s a bad outcome. So it is very, very preventable because ablation works really well. I can’t say 100% of the time, but a huge percentage of the time, ablation works. And so the challenge that physicians have is which of my patients do I ablate and which don’t I ablate and which can I not bring in every year or nine months or year and a half for surveillance endoscopies?

So what the test does is it helps them reclassify their patients’ high risk versus low risk. And so the utility is really good because most GIs have in their practice or they have a colleague who had a nondysplastic Barrett’s patient who by pathology should be low risk. Not a worry. Don’t worry about it. Bring them back for regular surveillance.

You’ll be fine. And that patient has progressed to esophageal cancer. So physicians, I think, understand well that the pathology of Barrett’s does not well align with the prognostic risk, and you need a biological answer for that. So it just aligns well with what they know about their practice and about their patient. Now on the commercial side, if if I’m a commercial payer, I should be willing to pay for that test because I don’t want to ablate somebody I don’t need to ablate.

And I don’t want to not ablate somebody I should ablate because esophageal cancer is an expensive cancer. So as a payer, I should be enthusiastic about this. Now the challenge is we have the usual payer challenges, which is say no until say no and say no. And then by the way, Castle, aren’t you given the test? Aren’t you given the report anyway?

So aren’t I getting the right people ablated if doctors use the report? So as a sector, we have a bit of a we’re a bit cross purposes with how payers think about that. But there should be good wind at the back to get the right patients ablated who need it. So, this year, I wouldn’t assume any ASP improvement. We are not accruing for commercial claims.

We recognize revenue as cash comes in the door. And so that’s still fairly episodic. But we’ve got a full team working on that. And that’s part of our part of a big initiative for this year is to bring those commercial payers over to see the value of the test.

Puneet Sada, Host, Lyric: Got it. Okay. That was helpful. Maybe just rounding out since this is an important growth driver for you. I mean, you talked about, I think Derek mentioned it at one point as well, private equity GI roll ups that are happening.

I think you mentioned 50% of GIs are in a roll up and that could be an opportunity. How much of this growth contribution you could potentially see from this type of sort of independent practices getting rolled up in the space?

Frank Stokes, CFO, Castle BioSciences: So the biggest difference there is in dermatology, the roll up the number of practices that are rolled up is pretty small. I think we’ve said we think maybe 15%, twenty %. And so most dirhams are practices of one or two or three practitioners. And so that means if you want to convert 30 doctors, you got to go see 10 practices maybe or maybe 15 practices. The opportunity with GI may be a little bit more concentrated and that there is a larger percentage of private equity and other owned management companies.

And it gives us the opportunity to try to demonstrate the economic advantage to the practice of using the test to someone in management, if you will, maybe CFO of a practice company or maybe a Chief Medical Officer, and have them become our advocate to help sell the test to the physicians that are part of the practice as they see the benefits to patients, but also to cost. GIs, by and large, don’t want to do unnecessary upper GI endoscopies. If the, I don’t want to say the correct, but the gold standard or the textbook way to do a Barrett’s surveillance endoscopy is the Seattle protocol, which is several layers of pinches all the way around the esophagus, effectively getting samples from the whole esophagus. It takes fifty minutes. And so that’s a significant part of a practice day.

And so one, physicians don’t want to do endoscopies that they don’t that aren’t appropriate. And two, what that does is it drives many times the physician will sample rather than do a whole Seattle protocol, they’ll sample where they see Barrett’s. And so they are missing some tissue, which sometimes means that there’s disease or dysplasia that isn’t being picked up. And so that offers a couple of things for a bigger practice group. If you can reduce those numbers of endoscopies and convert those to colonoscopies, which is a much quicker, much less wear and tear on a practice procedure to a management company that may have some appeal.

So we don’t have anything in our guide yet. We don’t have any expectation for that at this point, but we do have some really key smart people internally who are focused on that this year to see if there is a way for us to work with those groups and potentially convert. Instead of taking 15 practices to convert 30 physicians, maybe you need one point of contact. So we don’t know yet. We’re early, but it’s something that we’re working on that may be an opportunity in that business.

Puneet Sada, Host, Lyric: Got it. Okay. Then switching gears, SCC, correct me if I’m wrong, but I think you have coverage until April 24 here. Obviously, this has been an ongoing challenge. Numbers are out of the model at this point into the back half of the year and next year at least in our models.

Can you talk about the pathways at this point? I mean, you have the MALDI X pathway. You have potentially reconsideration request with Novitas. And I don’t know if there are any other pathways. But maybe just give us a status update on potential to get the coverage back again here?

Frank Stokes, CFO, Castle BioSciences: Sure. So a little bit to unpack there. So the current proposed LCD for Novitas is proposed to go in effect April 24. So our guide for the year and our expectations for twenty sixth assume that April 25 that goes away as revenue. So both as part of the Medicare program integrity manual and part of the Medicare process, stakeholders have the ability to ask for a reconsideration of an LCD, of a policy.

And we can do that with either or both of the contractors that we’ve worked with on this. We will decide at the right time when to ask for that if that’s the path we take forward. And then there’s something there’s some ambiguity about the timeline there. There’s not a specified timeline for reconsideration. So we’ve suggested that that could be probably two years as a base place to think about.

Having said that, we have significant evidence supporting our SEC test that isn’t included in either of those policies. And so in the case of Palmetto, my understanding is that the publications I’m referring to came after the end of the comment period. And the manual suggests that they don’t have to look at things past the comment period and it seems they did not if you read the annotations and the policy. So we have substantial evidence that wasn’t part of that review that hasn’t been included, including the two largest studies relating to squamous cell carcinoma of the skin and adjuvant radiation therapy that have been done. And so on top of that, we have our publication from last March that shows if Medicare used our test to correctly or accurately direct adjuvant radiation therapy to squamous cell carcinoma, the skin patients, after the cost of our testing, they would save $1,000,000,000 And so it strikes me from what I’ve seen that this is a government interested in saving money.

And so this is a policy that by changing and having coverage, there’s $1,000,000,000 on the table that could be saved. So from that perspective, we think it has a positive impact on the health economics picture. But also it and we talk about it that way. We talk a lot about that. But it really misses how difficult adjuvant radiation therapy is for patients, especially Medicare patients.

Doctors will tell you it has 100 complication rate. There’s something many are mild and some are moderate, but there’s always something. The worst case, it can cause radiation induced dementia. So you’ve got a patient who is, let’s say, 85 years old, other medical conditions. They’ve got a high risk squamous cell carcinoma, the skin, which has a twenty percent to twenty five percent chance of progressing based on pathological features.

So if you’re a physician, you got four of those, do you want to send them all to radiation and risk those side effects or you want to send none and hope you catch the one that’s going to progress? It’s a real difficult decision to be made. And then further, if a lot of these squamous are above the shoulders. And so if you do radiation, you’ve lost you’ve shot that bullet for that patient. So if that patient comes back and has a just a basal cell on their face or nose or ear or something, you can’t use radiation.

So it’s a difficult procedure. Oh, and it’s $60,000 we think it’s $60,000 for a full course. So it’s a difficult procedure on patients and you’re taking away that bullet when there’s a seventy percent to seventy five percent chance you didn’t need to use it. So we talk a lot about the savings and the $1,000,000,000 to Medicare, but really, we really would appreciate the contractors also talking about if this was your dad or uncle or spouse and they’ve got a squam and it’s only twenty percent chance of metastasizing, do you really want to send them to radiation therapy? So we think we have the evidence to support coverage.

We just need to go through the process to present it. And of course, we’re also developing and hopefully publishing additional evidence as we run along as well.

Puneet Sada, Host, Lyric: Got it. Let me touch on the DECISION DX melanoma. I mean, I think in the fourth quarter, you pointed out a few of the dynamics. I think there was two of the holidays overlapping. Sequentially, when I look at it, the volumes were down and up maybe only a point or so.

So just wondering, is this just happened to be a unique situation this year? I mean, obviously, these holidays are coming I mean, every year. So how much of this is seasonality? Are there any factors that impacted that are continuing into the first quarter? Or is there are there any challenges that you saw that are continuing into the first quarter?

So just wanted to get a sense of volume there.

Frank Stokes, CFO, Castle BioSciences: Yes. So every year, Q4 and Q1 are seasonal for us, and it’s different drivers. And we spent a lot of time with groups about this. And you look at Q3 to Q4, ’3 less working days in Q4 than Q3.

Puneet Sada, Host, Lyric: Well, it

Frank Stokes, CFO, Castle BioSciences: seems like no big deal. Three days, what’s five percent, right? That’s a five percent fewer patient encounters likely that physicians are having. And then Q1, you always have dermatologists really enjoy good travel. So there’s two meetings.

There’s one in Maui and one in The Caribbean in the first quarter, and then AAD is right now going on. So there’s a lot of events going on that draw physicians’ time and capacity away. So but you’re right, it’s every year. These things happen every year. So the challenge we have is for us as we manage the Durham team, we’re managing to Centimeters and SCC together.

And that’s because that’s what drives test reports and that drives revenue while we’re reimbursed. So the difficulty, I think, that is part of what your question looks to is you’re looking at it from I hear that now, Frank, but when SCC goes away, then we’re focused on melanoma. So that’s really and that’ll be a shift. So we will and we’ve said before, as the policy goes effective and we’re no longer covered, we will change the way we market and drive our sales force and market our two tests. We have also said we’ll continue to leave it to be available.

There are a number of reasons for that. One is ethical. We know that the test matters to patients and their physicians. And one of the things that we think about every day at Castle is every test report has a patient and a family on the other side of it. And so we would it would be an ethical challenge to pull that test.

But secondarily and perhaps more practically, 75% of the SCC tests are written by a physician that’s using melanoma. And so we want to ensure if we make changes there that we don’t disrupt the melanoma business or impact our melanoma usage as we transition through this period on SCC. So I think that we will be effective with changing that focus. We have not had a sales force that is only selling melanoma. I think the last time we had that, we had 23 reps, if our I think that’s the right number.

So now we will have 65 to 70 reps selling just melanoma. So we should see wind at the back. We would expect to see wind at the back from that. But we don’t have a comparable period to go back and say, all right, the last we had last time we just had melanoma, here’s what productivity looked like, because we had much larger territories, we had fewer territories. So we’ll get a sense of that as we make that transition.

And then we also another practical reason is we do think there’s evidence to at some point recover reimbursement and we would rather have the SEC business be at some run rate than having had just shut it down and have to start all over from ground zero. So we will offer the test. The marginal cost of goods are manageable. We will deemphasize it or promote it less aggressively. There’s not a lot of spend that we do that’s just FCC.

Really, most of what we do is both derm tests because there is such great overlap between the physicians for the two tests. It’s really for a non medical guy, it’s the same clinical question just being answered for two different groups of patients. So the synergies and the pin action in that marketing effort is so good. So there’s not a lot of spin purely around SCC. So we’ll pivot that.

We’ll transition that to melanoma. And I would expect some wind at the back, but we’ll wait and see it when we get there.

Puneet Sada, Host, Lyric: Okay. A lot of other questions to get to, but just very briefly, do you think the penetration in cutaneous melanoma today makes it you know, somewhat challenging to drive that level of growth even with 60 plus reps?

Frank Stokes, CFO, Castle BioSciences: It it’s definitely more mature now. And just intuitively, the first, you know, the first users are the easiest ones. Right? The the ones that use it first are the ones that became convinced the quickest, and your later users are less quickly converted. But last year, we had 1,800 new ordering physicians even last year.

And so that’s a great metric this deep in, this far into the marketing of melanoma to still be able to convert 1,800 new physicians. And now I don’t know what we can do this year because that number should be getting smaller as it gets tougher as well. But that also brings up same store growth if you think about it that way. Many times a new ordering physician will make their own cut points or make their own categorization of their patients. And so we’ve got evidence and data all the way from ultra low risk to high risk showing where we have utility and where we’re effective.

And so if we do have a new physician that’s made that cut point or decided this is high risk for me, this isn’t, then we’ve got great, great material for the reps to get in there and say, hey, you figured it out. You’re testing this group of patients, but you really have benefit for here as well. So it is a more mature test. We think we’re over 50% or sixty percent of applicable or eligible clinicians are using the test. The ones that aren’t, a lot of them are still maybe no see practices or just we haven’t had the opportunity to get around to them and to educate them on the test yet.

So I would expect us to still grow. But yes, coming off a bigger base, it will be more of a mature cycle, mature profile.

Puneet Sada, Host, Lyric: Got it. Just quickly on ID genetics, you are deemphasizing that test. Just wondering how to think about for modeling for the rest of the year? And maybe is there was there any write down associated with that? You’ll see the depreciation of the intangible value will hit the P

Frank Stokes, CFO, Castle BioSciences: and L over time. We’ve shifted to an internal sales force there. A number of factors have driven that. The market has changed a good bit. There’s a genericization to it with physicians and some groups relying on single snips or double snips.

The reimbursement has stayed very difficult. And I can only suppose what drives that. I think my own sense is a lot of it is that a depressed patient who isn’t responding to their meds doesn’t have incremental cost typically to an insurance company. The cost is usually borne by the family or the employer. And so maybe that drives it just pure MLR.

But we saw the change United made back in the fall, and that certainly suggests incremental headwinds on reimbursement. So even with the lower volumes through this year and the attendant lower revenue, it’ll be net positive to EBITDA as we shift how we support that. We still think it’s a great test, and it’s medically important. But the environment is tough on that one.

Puneet Sada, Host, Lyric: Got it. Couple of CFO questions, if I may. I mean, gross margin side, let’s start there. You have guided to mid to high 70s for gross margin. This compares to, I think, about 80% I mean, in gross margin in 80s in 2024.

With SCC and ID Genetics impact here, so how should we think about overall gross margins? And then how should we think about gross margins into 2026 when both of those tests maybe are not contributing?

Frank Stokes, CFO, Castle BioSciences: So a couple of puts and takes there. As you can appreciate, when you don’t get paid for your service, it has a negative impact on margin, right? So we would expect with SCC coverage going away, our adjusted gross margin would be in the low to mid-70s as a starting point. Where that evolves from there will depend on how much volume we continue to run on SCC, but also how much Tissue Cypher traction we continue to develop. Tissue Cypher is a lower test, lower gross margin test than GEP.

The solid tumor GEP tests are we run them on Quant Studio PCR platform, very efficient, very cost effective. Tissue Cyber has a bit more manual process to it. Now having said that, at those ranges, we’re still fairly well positioned when you look across the comparable set in terms of gross margin. And then we still have plenty of margin to push down the P and L to support the other expense functions. So I would think if SEC coverage stays gone, that low to mid-70s adjusted gross margin is where we’ll stay.

And even as tissue cipher grows more and more, I’m confident that we can do we can still make yet some changes that can make it a bit more efficient, help out with COGS a bit. It’s a radically different cost structure now than when we got it. It was 100% manual when when we when we when we got the test, when we bought the company. And now we have, you know, this even even the staining at the front end was manual. And now we have this beautiful row of very expensive but very efficient auto stainers that that take that out of it.

And a lot of the annotation now is done by the tech, by the computers. So we’re pushing on that, trying to get it more efficient. And another attendant question there is capacity. We continue to stay ahead of demand on capacity. If you recall, in ’twenty three, we had capacity challenges for a quarter, and we stayed ahead of that partially with some of that automation and improvement.

And also, we increased the size of the Pittsburgh lab, and that’s given us more space, more people.

Puneet Sada, Host, Lyric: Got it. Just going below the line, when we what are some of the levers you have in terms of sales force? There is some deprioritization. There is some other assays where you’re increasing more efforts. But maybe just talk to us about how should we think about overall margins below the gross margin line?

And then how should we think about the cash flow? I think you I believe you said cash flow positive in fiscal year ’twenty five, but how much of that was driven by SCC and now that SCC is not there?

Frank Stokes, CFO, Castle BioSciences: Yes. We’ve said even without SCC, we’ll be operating cash flow or adjusted EBITDA positive for ’twenty five, percent and we’re still confident in that. So at some point in a sort of a common size P and L, and it won’t be this year, of course, but we should look more like a 20% to 25% EBITDA P and L with as much as 20% maybe in R and D and more spend in the S of SG and A and not as much in the G and A. But that’s where we would target getting the business to in the near term. I mean, I wouldn’t think this year we were close last year.

I mean, as you look at last year’s performance and if we had reimbursement coverage on SCC with the growth there, we would see getting there pretty quick. But we were a net income company last year, and then this year, it’ll shift a bit as that reimbursement change goes through. But ultimately, we should look like that from a more of a mature business perspective.

Puneet Sada, Host, Lyric: Got it. Just we’re almost out of time. Just briefly on is there, given the changes that have happened on the test, can you just briefly talk about how are you thinking about potential capital deployment M and A if there are tests that you can bring in to fill the ones that are sort of getting deemphasized?

Frank Stokes, CFO, Castle BioSciences: So I guess with the caveat that we don’t feel compelled to go try to buy something, we do feel like we’ve got a good playbook for running diagnostic tests, testing services. We’d love to find another product for our GI group to have to sell. We saw such good leverage with melanoma and SCC. We would expect to see same similar leverage in the GI space. So that would be a priority.

If we could find a good high value, high clinical need test, that would be attractive. And we would selectively look outside of our areas. But again, we don’t feel our therapeutic areas, but we don’t feel compelled. And it’s funny. We like having a strong balance sheet, and we’ll make sure that we continue to have that.

But if we see interesting opportunities that fit the criteria, we do the work and see if that makes sense.

Puneet Sada, Host, Lyric: Great. Okay. All right. That’s all the time we have. Thanks, Frank.

Thanks. Okay. Thank you.

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