PresentationGood afternoon, and welcome to Castle Biosciences DecisionDx-Melanoma Webcast. As a reminder, today's webcast is being recorded. Drs. Guenther and Goldberg will begin with a presentation that follows the accompanying slide deck, followed by a brief question-and-answer session. I would now like to turn the call over to Dr. Matthew Goldberg, Senior Vice President of Medical for Castle Biosciences.Matthew GoldbergSenior Vice President of Medical Thank you, operator, and good afternoon, everyone. My ...

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Castle Biosciences (NasdaqGM:CSTL) Update / briefing March 23, 2026 04:30 PM ET Company ParticipantsCamilla Zuckero - VP of Investor Relations and Corporate AffairsCatherine Schulte - Director of Life Sciences Equity ResearchDerek Maetzold - President and CEOMason Carrico - Managing Director of Medical Technology Equity ResearchMatthew Goldberg - SVP of MedicalMichael Guenther - Surgical OncologistConference Call ParticipantsCarlos Penikis - Senior Equity Research AnalystThomas Flaten - Senior Equity Resear ...

Core Insights - The publication confirms that DecisionDx-Melanoma's integrated sentinel lymph node biopsy (i31-SLNB) test effectively identifies patients with a low risk of sentinel lymph node (SLN) positivity, outperforming traditional staging criteria and other predictive tests [1][2][8] Group 1: Study Findings - Among patients predicted to have less than 5% risk of SLN positivity, the actual SLN positivity rate was 2.6%, with a three-year recurrence-free survival (RFS) rate of 97.8% [1][5] - In patients with T1b–T2a tumors predicted to have less than 5% risk, the SLN positivity rate was only 1.4% [1] - Patients with a predicted risk greater than 10% had an SLN positivity rate of 21.4%, indicating an 8.2-fold higher likelihood compared to those with low predicted risk [2][5] Group 2: Clinical Implications - The i31-SLNB test integrates a 31-gene expression profile (GEP) score with clinicopathologic factors to provide a personalized risk assessment, supporting decision-making aligned with NCCN guidelines [2][11] - The study demonstrated a true-negative to false-negative (TN:FN) ratio of 55:1 in T1–T2a patients, significantly exceeding the NCCN guideline benchmark of 19:1, indicating superior performance in identifying low-risk patients [7][8] Group 3: Company Overview - Castle Biosciences, Inc. focuses on developing innovative tests that guide patient care, particularly in dermatologic and gastroenterological diseases [13] - The DecisionDx-Melanoma test has been clinically validated in over 10,000 patient samples and has been associated with improved patient survival [12]

Core Insights - The study presented at the Society of Surgical Oncology (SSO) 2026 Annual Meeting highlights the effectiveness of the DecisionDx-Melanoma test in predicting sentinel lymph node (SLN) positivity and guiding clinical decisions regarding SLNB [1][3]. Group 1: Study Findings - The DecisionDx-Melanoma test demonstrated an actual SLN positivity rate of 2.6% for patients with a predicted risk of less than 5%, confirming its clinical utility [2][5]. - In the T1b–T2a tumor subgroup, only 1.4% of patients with a predicted risk of less than 5% had a positive node, while those with a high-risk result (greater than 10%) had an SLN positivity rate of 18.5% [6][7]. - Patients identified as low risk exhibited a 97.8% three-year recurrence-free survival (RFS) rate, indicating favorable long-term outcomes [7]. Group 2: Clinical Implications - The NCCN guidelines recommend forgoing SLNB when the likelihood of finding a positive SLN is less than 5%, which aligns with the findings of the DecisionDx-Melanoma test [4]. - The i31-SLNB algorithm integrates a 31-gene expression profile (GEP) score with clinicopathologic factors, providing a personalized risk assessment that enhances decision-making for SLNB [4][9]. - The study reinforces the ability of DecisionDx-Melanoma to differentiate between low- and high-risk patients, thereby supporting more informed clinical decisions [8][10]. Group 3: Company Overview - Castle Biosciences, Inc. is focused on developing innovative tests that improve patient care, particularly in dermatologic and gastroenterological diseases [11]. - The DecisionDx-Melanoma test has been validated in over 10,000 patient samples and has been ordered more than 220,000 times since its launch, demonstrating its widespread acceptance and clinical relevance [10].

Core Insights - Castle Biosciences announced new data on the DecisionDx-Melanoma's i31-SLNB test for predicting sentinel lymph node (SLN) positivity, to be presented at the SSO 2026 Annual Meeting [1][2] Group 1: Test Performance and Validation - Initial reports from a prospective, multicenter study confirmed that DecisionDx-Melanoma impacts SLNB decision-making and identifies low-risk patients for nodal metastasis [2] - The i31-SLNB algorithm integrates a 31-gene expression profile (GEP) score with clinicopathologic factors, providing a more precise risk estimation than traditional staging criteria [3] - DecisionDx-Melanoma has been clinically validated in over 10,000 patient samples and has been ordered more than 220,000 times since its launch, showing an association with improved patient survival [6] Group 2: Clinical Application and Guidelines - The test enhances risk stratification for patients with stage I–III cutaneous melanoma, guiding management decisions such as SLNB consideration and follow-up intensity [5] - The data presented at SSO 2026 supports the use of DecisionDx-Melanoma in alignment with National Comprehensive Cancer Network® guidelines for risk thresholds [2] Group 3: Company Overview - Castle Biosciences focuses on developing innovative diagnostic tests to improve health outcomes, particularly in dermatologic and gastroenterological diseases [7] - The company emphasizes patient empowerment and informed care decisions through advanced molecular tests [8]

Core Insights - Castle Biosciences announced new data on the DecisionDx-Melanoma's i31-SLNB test for predicting sentinel lymph node (SLN) positivity, to be presented at the SSO 2026 Annual Meeting [1][2] Group 1: Test Performance and Validation - Initial reports from a prospective, multicenter study confirmed that DecisionDx-Melanoma impacts SLNB decision-making and identifies low-risk patients for nodal metastasis [2] - The i31-SLNB algorithm integrates a 31-gene expression profile score with clinicopathologic factors, providing a more precise risk estimation than traditional staging criteria [3] - DecisionDx-Melanoma has been clinically validated in over 10,000 patient samples and has been ordered more than 220,000 times since its launch, showing an association with improved patient survival [6] Group 2: Clinical Application and Guidelines - The test enhances risk stratification for patients with stage I–III cutaneous melanoma, offering personalized risk assessments for SLN positivity and recurrence/metastasis [5] - The data supports risk-aligned management decisions consistent with National Comprehensive Cancer Network® guidelines, including considerations for SLNB [2][5] Group 3: Company Overview - Castle Biosciences focuses on developing innovative diagnostic tests to improve health outcomes, particularly in dermatologic and gastroenterological diseases [7] - The company emphasizes a patient-first approach, empowering patients and clinicians through advanced molecular tests [8]

Core Insights - Castle Biosciences, Inc. is hosting a grand opening for its new corporate headquarters on March 24, 2026, in Friendswood, Texas, highlighting its commitment to the community and its growth strategy [1][2][3] Company Overview - Castle Biosciences is a leading diagnostics company focused on improving health through innovative tests that guide patient care, particularly in dermatologic and gastroenterological diseases [6][7] - The company reported revenue of $344 million in 2025, making it one of the largest publicly traded companies in Galveston County by revenue [4] New Headquarters Features - The new headquarters is designed to foster collaboration and innovation, featuring modern workspaces, advanced technology infrastructure, and energy-efficient systems [3] - Employee amenities include a private fitness center, outdoor collaboration spaces, and walking trails, promoting a healthy work environment [3] Community Engagement - Castle Biosciences has a history of supporting local initiatives in Friendswood, reflecting its commitment to improving lives for patients and the community [4]

Financial Data and Key Metrics Changes - Castle Biosciences reported fourth quarter revenue of $87 million, leading to a total revenue of $344.2 million for the full year 2025, exceeding guidance [6][21] - Excluding DecisionDx-SCC and IDgenetix revenue, the revenue growth for 2025 would have been approximately 34% [7] - The adjusted gross margin for the fourth quarter was 76.3%, compared to 76.2% in the fourth quarter of 2024, while the full year gross margin was 69.2%, down from 78.5% in 2024 [22][24] - The net loss for the fourth quarter was $2.3 million, compared to net income of $9.6 million for the same period in 2024, and the full year net loss was $24.2 million, compared to net income of $18.2 million in 2024 [27] Business Line Data and Key Metrics Changes - Total test report volume for the year was 105,053, a 37% increase compared to 2024, with TissueCypher report volume growing by 86% [8][10] - DecisionDx-Melanoma delivered 39,083 test reports in 2025, representing 9% year-over-year growth, while TissueCypher delivered 39,014 test reports [10][11] - The number of new ordering clinicians for TissueCypher increased to 2,082 in 2025, up from 1,234 in 2024 [13] Market Data and Key Metrics Changes - The company noted a patient penetration of approximately 31% for DecisionDx-Melanoma and 11% for TissueCypher exiting 2025 [11][13] - The American Gastroenterological Association recognized TissueCypher as a significant prognostic test for Barrett's esophagus, which is crucial for identifying high-risk patients [12][13] Company Strategy and Development Direction - Castle Biosciences aims to drive growth through its core revenue drivers, DecisionDx-Melanoma and TissueCypher, while also expanding into dermatology with the AdvanceAD-Tx test [9][15] - The company plans to initiate a pipeline test for GI diseases and evaluate EIS technology in collaboration with SciBase [17][18] - M&A will continue to play a role in the company's growth strategy, focusing on tests that are near or at market and reimbursement [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth story, emphasizing disciplined execution and the strength of the balance sheet [9][20] - For 2026, the company anticipates total revenue of $340 million to $350 million, reflecting mid to high teens growth over 2025 [21] - Management highlighted the importance of FDA clearance for DecisionDx-Melanoma to enhance reimbursement discussions and adoption [43] Other Important Information - The company completed the acquisition of Previse and launched the AdvanceAD-Tx test, which is expected to contribute materially to revenue in 2027 or 2028 [8][15] - Total operating expenses for 2025 were $387 million, up from $323.4 million in 2024, driven by increased personnel costs and higher sales and marketing expenses [25][26] Q&A Session Summary Question: Update on NCCN guidelines for DecisionDx-Melanoma - Management noted that the current guidelines did not change the threshold for sentinel lymph node biopsy and highlighted the importance of their test in reducing unnecessary procedures [35][36] Question: Timeline for FDA approval of DecisionDx-Melanoma - The company is preparing a de novo 510(k) submission, with expectations for acceptance by the end of the year or early next year, which could impact clinician adoption [42][43] Question: Strategy for AdvanceAD-Tx test - The sales team is focusing on maintaining momentum for DecisionDx-Melanoma while gradually introducing AdvanceAD-Tx, with plans to shift sales focus as adoption increases [49][50] Question: Expectations for TissueCypher volume growth - Management expects continued volume growth for TissueCypher, driven by both existing ordering clinicians and new clinician adoption, although growth rates may moderate as penetration increases [75] Question: Impact of potential LCD for DecisionDx-SCC - Management indicated that if an LCD is published, they would fold DecisionDx-SCC back into the sales strategy, but timing and confidence in reimbursement will dictate the approach [81][82]

Financial Data and Key Metrics Changes - In Q4 2025, the company reported total revenue of $87 million, leading to a full-year revenue of $344.2 million, exceeding guidance [21][30] - Excluding DecisionDx-SCC and IDgenetix revenue, the revenue growth for 2025 would have been approximately 34% [7] - The adjusted gross margin for Q4 was 76.3%, slightly up from 76.2% in Q4 2024, while the full-year gross margin was 69.2%, down from 78.5% in 2024 [22][24] - The net loss for Q4 2025 was $2.3 million, compared to a net income of $9.6 million in Q4 2024, and the full-year net loss was $24.2 million, compared to a net income of $18.2 million in 2024 [27] Business Line Data and Key Metrics Changes - The total test report volume for 2025 was 105,053, a 37% increase compared to 2024, with TissueCypher report volume growing by 86% [8][11] - DecisionDx-Melanoma delivered 39,083 test reports in 2025, reflecting a 9% year-over-year growth, while TissueCypher achieved 39,014 test reports [10][11] - The company had 2,082 new ordering clinicians for TissueCypher in 2025, up from 1,234 in 2024 [13] Market Data and Key Metrics Changes - The company reported approximately 31% patient penetration for DecisionDx-Melanoma and 11% for TissueCypher exiting 2025 [11][13] - The company is focusing on expanding its addressable market through the launch of AdvanceAD-Tx, which targets patients with moderate to severe atopic dermatitis [15] Company Strategy and Development Direction - The company aims to drive growth through its core revenue drivers, DecisionDx-Melanoma and TissueCypher, while also expanding into dermatology with AdvanceAD-Tx [10][15] - The company plans to continue evaluating M&A opportunities that align with its strategic criteria, focusing on tests that are near or at market and reimbursement [19] - The long-term growth strategy includes developing a pipeline test for GI diseases and collaborating with SciBase for EIS technology [17][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth trajectory, emphasizing the importance of disciplined execution and innovation [6][31] - The anticipated revenue for 2026 is projected to be between $340 million and $350 million, reflecting mid to high teens growth over 2025 [21] - Management acknowledged the challenges posed by the operating environment but remains focused on improving patient care through innovative tests [9] Other Important Information - The company completed the acquisition of Previse and launched the AdvanceAD-Tx test in late 2025, which is expected to contribute materially to revenue in 2027 or 2028 [8][15] - The company had cash equivalents and marketable securities of $299.5 million as of December 31, 2025 [29] Q&A Session Summary Question: Update on DecisionDx-Melanoma and NCCN guidelines - Management noted that the NCCN guidelines did not change the threshold for sentinel lymph node biopsy, and while DecisionDx-Melanoma data supports its use, only a fraction of studies were included in the guidelines [34][36][38] Question: FDA submission timeline for DecisionDx-Melanoma - The company is preparing a de novo 510(k) submission, expecting acceptance by the end of 2026 or early 2027, which could enhance reimbursement discussions [41][43] Question: Strategy for AdvanceAD-Tx and sales team approach - The sales team is currently focused on DecisionDx-Melanoma, with plans to gradually incorporate AdvanceAD-Tx as awareness and adoption grow [47][50] Question: TissueCypher sales team and growth strategy - The company continues to expand the TissueCypher sales team and is exploring opportunities with larger group practices to enhance efficiency and volume [53][56] Question: Expectations for TissueCypher volume growth in 2026 - Management anticipates continued volume growth for TissueCypher, driven by both existing and new clinicians, although growth rates may moderate as penetration increases [71][75]