Biodesix, Inc. (BDSX) Q4 2021 Earnings Call Transcript

Biodesix, Inc. (BDSX 3.31%)
Q4 2021 Earnings Call
Mar 14, 2022, 8:30 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Biodesix fourth quarter and full year 2021 earnings conference call. [Operator instructions] I will not turn the call over to your host, Chris Brinzey. You may begin.

Chris Brinzey -- Investor Relations

Thank you, operator, and good morning, everyone. Thank you for joining us today for the discussion of Biodesix fourth quarter and year end 2021 business highlights and financial results. Leading the call today will be Scott Hutton, chief executive officer, who will be joined by Robin Harper Cowie, chief financial officer. After the prepared remarks, we will open the call for Q&A.

An audio recording and webcast replay for today's conference call will also be available online, as detailed in the press release announcement for this call. Today, we issued a press release announcing our business highlights and financial results for the fourth quarter and year end 2021. A copy of the release can be found on the investor relations page of the company website. Actual events and results may differ materially from those projected as a result of changing market trends, reduce demand, and the competitive nature of Biodesix industry.

Such forward-looking statements and their implications involve known and unknown risks, uncertainties and other factors that may cause actual results or performance to differ materially from those projected. The forward-looking statements discussed on this call are subject to other risks and uncertainties, including those discussed in the Risk Factors section and elsewhere in the company's annual report on Form 10-K for the year ended December 31, 2021, filed with the Securities and Exchange Commission today. Additional information concerning factors that could cause results to differ materially from our forward-looking statements are described in greater detail in the company's press release issued today and in the company's filings with the SEC. I would now like to turn the call over to Scott Hutton, chief executive officer.

Scott?

Scott Hutton -- Chief Executive Officer

Thank you, Chris. As a reminder, Biodesix is a patient-centric lung disease diagnostic company, with a mission to unite biopharma, physician, and patient to transform the standard of care and improve outcomes with personalized diagnostics. 2021 with another unprecedented year with multiple COVID waves throughout the year impacting access to physicians and shutting down hospitals. The Biodesix team would like to thank all healthcare professionals who have and continue to work tirelessly to help every patient.

We all know how difficult and challenging that job is, and how the pandemic has made it even more complex. Despite the headwinds and obstacles from COVID, we're pleased with the performance and results delivered by the Biodesix team. I believe our accomplishments and successes in 2021 speak volumes about our team, mission, vision, and culture, as well as the value our tests provide physicians and healthcare professionals who use the key critical test results and insights to positively impact their patients. Throughout the year, as we saw and experienced the ebbs and flows of the pandemic, the Biodesix team continued to lead and focus on strategic commercial execution.

We continued to focus on expansion of our direct dedicated sales team, growing from 24 sales team members to 48 sales team members by year-end. Increasing our commercial footprint is critical to our continued growth and development. These 48 sales team members sell our broad portfolio of five blood based lung diagnostic tests. The testing portfolio begins with the Nodify XL2 and Nodify CDT test, which are used for lung nodule management.

Not only did we see an experienced significant growth in the number of physicians ordering and using these tests, but we also shared data on Nodify XL2 in October from our prospective ORACLE clinical utility study at the 2021 CHEST Annual Meeting. The goal of the study was to demonstrate that incorporating this blood-based test into the management of patients with newly detected lung nodules could modify how physicians treat patients, while improving outcomes. The results successfully demonstrated that the Nodify XL2 test was able to reduce the number of invasive procedures on benign nodules by 67%, which supported and reinforced the data presented and published from the PANOPTIC study. In summary, the data highlights the importance of being able to provide a simple blood-based test that can rapidly reclassify a nodule as low-risk for the patient, providing confidence in a wait and watch approach supported by serial CT scans and for the health system as they focus on avoiding unnecessary, invasive, and costly procedures.

We expect this and additional data from this study were published in 2022. In the lung continuum of care, after a patient has been diagnosed with lung cancer, the Biodesix sales team members offer three blood based test for treatment guidance and monitoring. The proteomic VeriStrat test, that targeted genomic GeneStrat ddPCR, and our new broad genomic GeneStrat NGS test. In 2021, the Biodesix team made incredible progress that enabled us to introduce the new GeneStrat NGS test earlier than planned.

In November 2021, we initiated a limited commercial launch and followed that with full commercial launch in January of 2022, with Medicare payment for the tests already secured. When dealing with any disease, time matters. When dealing with the deadliest of all cancers in lung cancer, each and every day is critically important to the physician, the patient, and the patient's family. At Biodesix, we value time and fully appreciate its importance, which is why we take great pride in our 72-hour turnaround time for the new GeneStrat NGS test.

This complements the 36-hour turnaround time for VeriStrat and GeneStrat ddPCR, and provides Biodesix with three tests for treatment guidance and monitoring, with the fastest turnaround times available to physicians. Better supporting their need and interest in getting patients on the right and best treatment as quickly as possible. On the biopharmaceutical partnership and service front, we increase the number of contracts in dollars under contract, including near-term retrospective studies that will be conducted over the coming quarters, and longer term prospective studies that will be conducted and recognized over the coming years as our partners enroll patients. Overall, prospective trials in our biopharma activities in this area are robust, and we remain confident that we'll continue to see further growth and expansion in coming quarters.

Of note, we've received positive feedback and interest in the Biodesix Diagnostic Cortex, our proprietary AI and machine learning platform, including the unique capabilities that we publish mid-year and our broad multimodal multi-omics offering. Our efforts and advancements in transparent AI will provide additional insights and clarity to healthcare professionals while providing the ability and potential to identify key biological mechanisms, driving specific outcomes for patients subgroups that may require a different approach or different treatment. In 2021, the Biodesix sales team was innovative, flexible, and driven. In the third quarter, we noted that our sales team members were paying for themselves on average in four to six months, and including the COVID-19 challenge that continues to be the case today.

Now, let me turn it over to Robin to review the fourth quarter and year-end 2021 financial performance. Robin?

Robin Harper Cowie -- Chief Financial Officer

Thank you, Scott. Fourth quarter total revenue of $7.2 million, was in line with our expectations as compared to $27.0 million for the fourth quarter of 2020. The  $7.2 million represented an increase in revenue from our five core blood-based lung diagnostic tests, offset by an expected decrease driven entirely by the year-over-year change in COVID testing. As a reminder, the fourth quarter 2020 reflected significant COVID-19 diagnostic testing revenue, which we did not expect to be repeated in the fourth quarter of 2021.

Total revenue for the full year ended December 31, 2021, was $54.5 million, compared to $45.6 million for the full year ending 2020, an increase of 20%, driven primarily by the growth in core lung direct diagnostic tests and biopharma services. Our fourth quarter core lung blood-based diagnostic testing revenue, was $5.4 million versus $3.7 million for the fourth quarter 2020, reflecting a 48% growth rate. For the full year 2021, core lung diagnostic testing revenue was $18.7 million versus $12.6 million, a 49% increase over 2020. In the fourth quarter 2021, biopharmaceutical partnership and services revenue was $1.4 million, compared to $1.9 million for the fourth quarter of 2020, a decrease of 29%.

Biopharmaceutical services for the full year 2021 was $5.6 million versus $4.6 million, a 20% increase over 2020. As we have said, this business can fluctuate due to several factors, including contract timing, which can be long under normal circumstances, but in this instance reflects the continued impact the pandemic has had on overall prospective clinical trial enrollment. Despite the ongoing nature of the pandemic, we've consistently projected that COVID testing would drop off for multiple reasons, including the changing COVID-19 infection rates, and shifting toward convenient, rapid and personal at home antigen testing. And we were right.

COVID testing revenue was $0.4 million in the fourth quarter, versus $21.4 million in the fourth quarter of 2020, and $30.2 million for the full year 2021, versus $28.3 million for the full year of 2020. As a result of the decrease in COVID-19 testing, gross margin as a percent -- percentage in the fourth quarter 2021 was 65%, which was a significant improvement compared to the 46% gross margin recognized in the fourth quarter of 2020. The nearly 2000 basis point improvement in gross margin over the year ago quarter was primarily a result from the change in the mix of sales to our higher margin core lung diagnostic testing and biopharmaceutical services, and the sequential decline in COVID-19 revenue. Gross margin also increased sequentially over the third quarter 2021 by approximately 700 basis points and continues to reflect a mix shift to higher margin core products of lung diagnostics and biopharma services.

Gross margin as a percentage of revenue for the full year 2021 was 44% versus 52% for the full year 2020. It reflects a higher mix of lower margin COVID-19 revenue experienced in the first half of '21. Overall operating expenses, excluding direct costs and expenses were $16.4 million in the fourth quarter '21, compared to $15 million for the same period of 2020. Total operating expenses, excluding direct costs and expenses for 2021, were $64.9 million versus $46.5 million in 2020.

Both a year-over-year increase as seen in the quarter and for the full year 2021, were primarily driven by non-cash stock compensation increases as a result of becoming a publicly traded company in October 2020, and investments and expansion of our sales team and research and development. The net loss for the fourth quarter 2021 was $13.3 million compared to a net loss of $4.5 million for the fourth quarter of 2020. Net loss includes non-cash expense related to stock-based compensation of $1.3 million recognized during the fourth quarter 2021, compared to $3.6 million during the fourth quarter of 2020. The net loss for the full year ending 2021 was $43.2 million, compared to $31.4 million, which includes non-cash expense related to stock-based compensation of $4.9 million and $3.7 million during the 12 months ending December 31, 2021 and 2020, respectively.

We ended the quarter with $32.7 million in cash and cash equivalents, inclusive of the fourth quarter 2021 equity capital issuance of $15.7 million in net proceeds, and the prepayment of $20 million of the 2021 term loan. As disclosed in our recent filings and earnings calls, we have been working on raising additional capital to support our ongoing growth plans. In addition to the continued support from our investors in December 2021, last week, we were pleased to announce a new three-year facility with Lincoln Park Capital. This $50 million committed equity line, in addition to our [Inaudible] money facility, enhance our flexibility to access third party capital during this complex time.

Turning now to our 2022 guidance. We project total revenue of $37.5 million to $39.5 million. The low-end of this range takes into account some uncertainty around future waves of the COVID-19 pandemic. Our guidance assumes strong year-over-year growth in our core lung diagnostic testing business, driven by improved contribution from a larger commercial organization, an expected increase in utilization of all of our tests by physicians, growth of our newly launched GeneStrat NGS tests, as well as expected growth in our biopharmaceutical services business.

We have taken a variety of steps to add access to additional funding and reduce our cash burn, all while focusing on continuing to grow revenue in 2022 and '23. We will continue to invest in the commercial growth of our on-market products, including the commercial organization and select capital expenditures needed to support our projected growth. We expect to hire additional sales team members opportunistically similar cadence as last year, as our new reps are paying for themselves on average in about four to six months, as expected. However, we have chosen to delay certain long-term projects in both G&A and R&D, outside of our current commercial and pipeline products to reduce costs.

The results of these cost-savings measures we have implemented will be realized through 2022 and 2023. We expect that our anticipated top line growth and our ongoing cost-saving efforts will accelerate our EBITDA break even timeline. Now let me turn it back to Scott. Scott?

Scott Hutton -- Chief Executive Officer

Thank you, Robin. Many of you reached out to check on the Biodesix team in the aftermath of the greater than 6000 acre Boulder County Marshall Fire that erupted on December 30, 2020. Thank you for thinking of the Biodesix team. The Marshall Fire was the most destructive wildfire in Colorado history as it destroyed 1,084 homes and 10 businesses, while displacing countless other businesses and families.

The Biodesix team was lucky as the Biodesix's boulder based office and laboratory were not impacted, and all Biodesix team members were accounted for, with no team members having lost their home. Unfortunately, and sadly, the Biodesix team cannot say the same about our friends, neighbors and communities. This was not the end to 2021 that we had hoped for, nor was it something that we could have ever imagined. Yet, I'm extremely proud of the Biodesix team, as all team members rallied to provide support and assistance to those in need by opening their homes, volunteering, donating, assisting with fundraising and providing COVID-19 testing for the first responders.

While our community was still dealing with the Marshall Fires immediate impact, we began the year with yet another significant increase in COVID-19 infections as the Omicron wave hit locally and nationally. In fact, in January, the seven-day average number of COVID cases increased 93% in two weeks. Like many other companies, our business was impacted by the Omicron variant in January, and early February, mimicking the impact that Delta had in the third quarter of 2021. However, we are encouraged that as quickly as Omicron hit, it has rapidly subsided, which was reflected in the recovery we've seen since late February, and the continued improvements were seen in March, mimicking the rebound we saw in the fourth quarter of 2020.

Yesterday marks the two-year anniversary of when the Biodesix team departed the office to begin working remotely because of the global pandemic. Over the course of that two year period, we've shown how strong, resilient, adaptable and capable we are as a team. I'm extremely proud of the team and excited for us to continue to demonstrate these traits, as we progress through 2022 and in a post-COVID environment. The Biodesix team remain steadfast in our commitment to do the following; One, improve the lives of patients impacted by lung disease; Two, integrate Biodesix testing into physician practices, providing all the testing needed for a lung patient through the continuum of care.

One patient, one trusted company. Multiple test personalized results; Three, discover and develop new diagnostic tests like our risk of recurrence test and primary immune response test; Four, lead the way with AI explainability and transparency; Five, conduct numerous clinical studies to demonstrate the real world performance of our test; And six, continue to grow and expand our biopharmaceutical partnerships to aid in their research, drug development, clinical trials and development of companion diagnostics. In 2022, we plan to strengthen our balance sheet, which will enable the Biodesix team to deliver the following; One, strong adoption and growth of our core lung diagnostic testing and biopharmaceutical services; Two, more physicians ordering and utilizing our test results than ever before; Three, continued growth and expansion of the direct and dedicated Biodesix sales team; Four, additional data read-outs from our ongoing studies. Providing additional clinical data that supports commercial adoption and reimbursement for our on-market test; And five, progress in the development of our pipeline products.

The blood-based proteomic primary immune response test for lung cancer immunotherapy guidance, and the blood-based proteomic risk of recurrence test for early stage lung cancer pre-surgical resection recurrence identification. As we close, I'd like to take a moment to recognize and thank the Biodesix team. Your focus on our mission, vision, and culture inspires me. Thank you for your commitment and daily contributions to positively impacting patients lives.

With that, I'll turn the call over to the operator for questions.

Questions & Answers:

Operator

[Operator instructions] First question comes from Brian Weinstein with William Blair.

Brian Weinstein -- William Blair and Company -- Analyst

Hey, guys. Good morning. Thanks for taking the questions. So a few things here.

First, in the script, you guys talked about significant growth in positions that were you should call on franchise and then we saw the growth rates there but, can you give us a little bit more in terms of details there? I know you guys have been reticent in the past to break things out a little bit, but is there any kind of color that you can provide about docs or utilization stats that you saw in the year? And then how that -- Robin for you, how that translates into the build up for your guide in '22?

Scott Hutton -- Chief Executive Officer

Yeah, thanks, Brian. Good morning. Good to hear from you. It's a great question.

One of the things we've stated in the past is, we've got a number of metrics that we track on physician utilization, and we were very clear over the last 18 to 24 months that obviously with the pandemic, there were a lot of starts and stops. And so, we think that we've stabilized. We're looking forward to disclosing and sharing some of those metrics as we progress through 2022. But we've also been clear that Omicron did impact physicians.

The one thing we saw with Omicron that was a little bit different was people got sick, right? You saw it run through, I think, we stated in the script, 93% increase in two weeks. We saw a number of physicians, healthcare providers, and their staff staff get sick. They returned to work quickly, though, so that disruption was -- minimal. It didn't extend through the quarter.

So we feel good that we're starting to learn how to recover and rebound. So we're excited to share those metrics when we get a little more stability. What I can share, though, Brian, is, we've seen a record number of physicians ordering retention and reorder rates are extremely high and they continue to improve. And that's what we were looking for because we think that's not only a strong indicator of what the physicians see in terms of our test results and how much they matter and impact them.

But also it starts to show the stability that they've got in their practice.

Brian Weinstein -- William Blair and Company -- Analyst

Yeah, I think -- sorry. Go ahead. Sorry --

Robin Harper Cowie -- Chief Financial Officer

From a model perspective, Brian. All of those are critical inputs -- inputs for us for predicting out the model. And as Scott mentioned, when you take out the COVID waves and those starts and stops, it helps us become much more predictive about what we expect to happen, excluding COVID abnormality.

Brian Weinstein -- William Blair and Company -- Analyst

Yep. Understood. On the --  on the NGS test obviously, very early days. But, any comments that you want to make about the message and how it's being received and then, Robin, back to you on how to think about that product in particular, as far as the contribution that it could -- it could make toward that guidance range?

Scott Hutton -- Chief Executive Officer

Yeah. Thanks, Brian. We're really pleased. Early feedback and utilization has been strong.

Slightly better than we forecast and anticipated, but as -- you said, it really is early. We did the limited release at the end of the year, just introduced it a few weeks ago. We've got the entire sales team, all 48 sales professionals out, presenting and representing that test and supporting its needs and interests. But we're really pleased, we're excited.

It will take a little bit of time to kind of scale and ramp, but thus far, early indications and feedback is exceptionally positive.

Robin Harper Cowie -- Chief Financial Officer

Yeah. From a modeling perspective, we take a fairly conservative approach, as with any new test launch, we wait to see the adoption, the number of tests per physician -- number of physicians that begin using, and so we expect a relatively modest contribution from NGS in 2022, with a stronger -- stronger performance in '23 and contribution to the business really in '23.

Brian Weinstein -- William Blair and Company -- Analyst

OK. And the last one for me is on the salesforce. Are you doubled it in '21? And I wasn't sure if the comments on the call were signaling. You talked about a similar pace, so I didn't know if that meant adding another 24 in reps in '22 or kind of six per quarter.

And then, as you're adding those reps and just as you think about your business in general, there was the shift toward the pulmonologist a couple of years ago. Now you have some products that are geared a little bit more toward the oncology setting, I mean oncology setting. So, can you talk about how the salesforce splits their time there and in the comp plans that are each segment is based on what? Well, yeah, just basically how those reps are are being evaluated this year. Thanks.

Scott Hutton -- Chief Executive Officer

Yeah. Thank you, Brian. Just as a reminder for everybody, we had approximately 24 sales team members at time of IPO. We stated we would double that, which we did.

So we exited the year at 48. What we achieved last year was a steady rate of six sales professionals per quarter. Really, that allows us to train onboard, educate, inform, get them up and running. So we like that cadence, but we want to be opportunistic about it.

Obviously, there are a lot of things out there impacting the market. We want to make certain that when we bring somebody on, they've got clear line of sight to a path for growth, and we want them to be able to get toward profitability and paying for themselves as quick as possible. For us, it is also a balance of bringing on sales professionals that we can put into new dirt or territories where we haven't had somebody calling each and every day. We stated at time of IPO with 24 sales reps, we had number of sales reps covering multiple states.

So one of the other goals for us was -- "Let's minimize overnight decrease windshield time not only make it a little more lean, take out some costs, but let's embed them. Let's just make their territories a little bit smaller so that they truly can be that consultative sales professional that the physicians look for as a trusted resource for them. So we think we're doing exceptionally well. We have -- we're not going to be as bold, Brian, to state, yeah, we're going to honor that and do six per quarter and add another 24.

We think that there's room for that. But again, we'll be mindful about when we bring on sales professionals this year. You bring up a great point in terms of the call point. You're correct.

When we introduced Nodify XL2 and Nodify CDT, we really did have the sales team focused going as early as they can into that early diagnosis and detection phase pulmonologist play and -- it's really strong role there. As we have introduced the NGS test, well, we have begun bringing on what we call oncology specialist. And so our plans here are within each of our regions to have a number of oncology specialists that that the pulmonology based sales professionals can bring in as the expert when they need to. If a medical oncology call point wants to go through all of the different clinical studies and talk about the trends in treatment, we're going to ask our pulmonology team to learn that, but we're also going to give them a resource or two that can come in and support that.

It really is kind of a blender hybrid, we've done this in the past with our medical science liaison team, obviously all PhDs focused on clinical trials, and that worked exceptionally well. So, Brian, we hadn't disclosed really what that will look like and if any of those additional heads will be those oncology specialists, we'll look forward to disclosing that -- wasn't likely in the next quarter as we see how the -- how the year starts. Was that helpful, Brian?

Brian Weinstein -- William Blair and Company -- Analyst

Yeah. That's great. Thank you, guys.

Scott Hutton -- Chief Executive Officer

Thank you, Brian.

Operator

Our next question comes from Kyle Mikson with Canaccord Genuity.

Kyle Mikson -- Canaccord Genuity -- Analyst

Thanks, guys. Thanks for taking the questions, and good to see the guidance for the year. Sounds like that includes the NGS test, so that's good and understand some of the expectations to assume there. Can you just tell us if that assumes any like COVID testing right now? I know it's probably a small contribution.

Just curious how you're thinking about that for this year. And then could you also parse out some of the assumptions for like salesforce access and maybe productivity of the new reps just relative to some of the recent quarters? Thanks.

Robin Harper Cowie -- Chief Financial Officer

Sure, Kyle. Thanks for being on the call. The guidance includes very, very little COVID revenue for the year. As we saw in the fourth quarter, COVID revenue dropped off significantly as expected as the country really shifted more toward the point of care rapid antigen testing.

Nothing in our experience really changes that assumption. From a productivity standpoint, as we mentioned, the reps are continuing to pay for themselves at about four to six months. So right on or a little ahead of expectations, and rep access is -- it's good right now, that can be impacted as there are COVID spikes as we've seen over the last year. I think what we've seen wave after wave is consistent that when there's a major wave in any given area, rep access is limited.

Patients going into the doctors are limited. Physicians and staff being sick impacts access, and so it's really a start and stop. But excluding Delta in the third quarter, excluding Omicron in January, early February, rep productivity continues to improve, and we're very pleased with the progress of the sales organization.

Kyle Mikson -- Canaccord Genuity -- Analyst

OK. Great to hear. Thanks, Robin. And shifting to the biopharma services business, notice [Inaudible] this morning indicates they are experiencing some delays still.

So I'm just -- I just want to understand if what you're assuming in the near-term here with some of those trials? And obviously, the funding environment for some of these Biodesix is pretty much nonexistent right now. I know, we're talking about pretty much larger companies that you're in conversations with. I'm just wondering, do these things hinder the pharma services revenue going forward, maybe in the near-term here for '22? A bit curious to hear that. Thanks.

Scott Hutton -- Chief Executive Officer

Yeah. Thank you, Kyle. That recent Omicron spike definitely had a little bit of an impact in biopharmaceutical services. We experienced a temporary slowdown in retrospective studies when it comes to sample delivery access to those samples.

And then on the prospective study side, there definitely was an impact. And then we're monitoring closely those contracts we have in place and the partners we're working with, as you can imagine, any sort of clinical study that's occurring in Eastern Europe right now, we've got we've got some questions and concerns about access to those samples and compliance for those patients. So I think it's easy to say that historically, the biopharma services business has been a little bit lumpy. Based upon timing of contract.

You may have noticed that we stated that we've got more contracts in place, larger samples committed to. We think that's one of the path forward to minimize the lumpiness and smooth that out. And so we're going to continue to go out and hunt and farm and bring in as many samples as possible, hoping that we can normalize that over time. When when it comes to trends, the biggest concern, right, the pandemic around the world does have the ability to impact those studies.

It's really complex and difficult to actually forecast and anticipate that impact. We're spending more time than ever, really, looking at where those samples coming from, can we get ahead of it? What can we do to help? But as you can imagine is as you see a spike in COVID around the world, it definitely shuts down some of those communities. It keeps patients away. And there is -- there is a delay there.

We feel good about the long term-viability. The conversations we're having with biopharmaceutical companies, academic institutions, research institutions, if anything, what we've noticed is that we're coming out of a pandemic where we told patients to stay away, especially those that were immunocompromised. There's a lot coming out in the literature now on the number and the percentage increase of cancers that maybe were missed and or now have a delayed diagnosis. Sadly, and unfortunately, we all know that one of the best things we can do is detect and diagnose cancer early or sooner, because it gives us a higher likelihood of a positive outcome.

Those delayed cancer diagnoses could be extremely problematic. And so what we've seen is healthcare professionals, academic institutions, biopharmaceutical companies really highlighting that and focusing on that and trying to pull it forward. So I'm hopeful and confident that no matter what happens with the pandemic in the coming quarters, that will change our approach and we'll continue to prioritize those high risk and cancer patients to make sure that they're compliant and they're back in. If we're able to do that, we should see samples coming in at a consistent rate.

Is that helpful, Kyle?

Kyle Mikson -- Canaccord Genuity -- Analyst

Yeah, Scott, that was great things for all about those those perfect. I'll ask just a last question. I heard your -- your goals, I guess, for 2022, just given the recent financings and capital position now. I just want to ask, though, what the company's priorities were for this year in order to drive shareholder value like more from a investment perspective to shareholders? Obviously, just curious how you could -- what's the near-term priority for your objective for you that you think could really -- could execute on -- execute on and really demonstrate some value to our major shareholders? Thanks.

Scott Hutton -- Chief Executive Officer

Yeah. It's a great question. We feel very fortunate to be in the position we're in with the number of reimbursed tests that we have, right. To be able to launch Nodify XL2 with the Medicare coverage in place, put us in a great position.

So with that being said, the on-market test we have continued to drive those that -- that's who we are at our core. We're excited to come out of the pandemic and get back to -- hopefully some pre-pandemic normalcy and leverage those reimbursed tests. You may have also heard and noticed that that even though the NGS test is early days, we have begun receiving Medicare payments. So for us, to have the test that we have that are available to physicians with the clinical data that we have supporting those tests, we think the number one priority continues to be growth, top line growth, grow the business, continue to leverage the increased number of feet on the street with our broadened salesforce.

And if we can do that, then we can get toward profitability. You may have noticed that we've referenced some measures without going into great detail, some measures we've put in place. And so now we're going to continue to push on our pipeline, peer and RoR . But as you'll recall, we said we were going to launch those in 2023, so you're not going to see a revenue impact from those tests in the next two years.

And so if anything, we want to be mindful that each and every dollar, each and every Biodesix teammate is focused on driving top line growth and generating revenue with our reimbursed core lung diagnostic test.

Kyle Mikson -- Canaccord Genuity -- Analyst

Great. Thanks, Scott, really appreciate that. Thanks, guys.

Scott Hutton -- Chief Executive Officer

Yeah. Thank you, Kyle.

Operator

And next question comes from Tejas Savant with Morgan Stanley.

Yuko Oku -- Morgan Stanley -- Analyst

Hello, this is Yuko on for Tejas. Thank you for taking our questions. For the GeneStrat NGS test -- what are your expectations for commercial versus Medicare volume? The mix there? And then how should we think about revenue per test in the early phases of the ramp and then over the longer run? 

Robin Harper Cowie -- Chief Financial Officer

Good morning, Yuko. The mix for GeneStrat NGS is the same as we are we've experienced with our other lung based tests. Some Medicare accounts for about 60% -- of the patient, so that is and remains consistent. With the revenue mix for Medicare versus commercial, that drives a good strong portion of the AFP. We are billing using the existing greater than 50 gene NGS panel code and the Medicare rate for that is about $2,800.

Yuko Oku -- Morgan Stanley -- Analyst

Great. That was super helpful. And then just a quick, separate follow up question. How should we think about opex cadence in '22?

Robin Harper Cowie -- Chief Financial Officer

We expect opex in '22 to grow over 2021, as we're continuing to expand our commercial organization and drive strong top line revenue growth for our lung diagnostics and biopharma business. But as we mentioned earlier, we have pulled on several levers to delay investments in certain long term projects that do not impact revenue near-term. So we are we are watching opex growth very, very closely and trying to be very intentional with each dollar spent.

Yuko Oku -- Morgan Stanley -- Analyst

Great. Thank you very much.

Operator

[Operator instructions] Our next question comes from Sung Ji Nam with BTIG.

Sung Ji Nam -- BTIG -- Analyst

Hi. Thanks for taking the questions. Just have a couple. Could you give us a sense of the -- in terms of the target clinicians and hospitals, the percentage of community hospitals versus academic that you're currently targeting? Or plan on targeting with the -- with the new NGS test?

Scott Hutton -- Chief Executive Officer

Yeah. Hi, Sung Ji. Thanks for the question. We've not disclosed, but in the way we look at it is our sales team members go in and really try to find in their community where they live, whether it's academic or a community based position where the really we want to go as early as possible, right? So where are the lung nodules being assessed? Where are they being referred to? And we really want to go there.

We want to go as early as possible. We think that's where there's the greatest utility for the Nodify testing portfolio, right. Again, in early detection and diagnosis with both the rule in and rule out test. Then as -- you know, we follow that lung cancer continuum of care.

Once the patient is diagnosed with lung cancer, similarly, follow those referral patterns. That's where you start to see a shift and you'll see a lot of referrals out of community into academics. And so we really call -- on both and all. We are not looking at prioritizing one over another.

This is more about positively impacting patients treatment and lives. And so the earlier we can get them into a testing regime and get them referred on to the best and optimal physician that works best for us also. Is that helpful, Sung Ji?

Sung Ji Nam -- BTIG -- Analyst

Yes, absolutely. Thank you so much. And then in terms of the ORACLE study, the registry study, I believe, will be completed sometime this year. And could you talk about what are some of the potential implications once that data is available in terms of -- from your commercial standpoint?

Scott Hutton -- Chief Executive Officer

Yeah, it's a great question. You don't want to speculate too much on what the potentials are, but there there still is an opportunity to get guideline inclusion. And so, we think that the best way that you can do that is with data. And so we're hopeful that as we continue to invest in ORACLE, and we're able to share and publish those results, that there's an opportunity for physicians, especially from a guideline perspective to consider the if, how, and when blood-based diagnostics play a critical role there.

So I think that's that's one, we've never discussed -- what a guideline inclusion could mean to forecast. We don't factor that in. Obviously, we want to be opportunistic for the if and when that presents. I would say that, that's probably the biggest opportunity at hand.

But most importantly, for our sales professionals and team members, when they're out, representing the portfolio of product data is key, right? And so our ability to highlight and demonstrate that in a real world environment and real world utilization that our tests perform at a similar rate to what they've performed in the validation studies, we think that's critically important. We don't want to stand behind tests that show any sort of degradation in performance. And so for us, I think that's the biggest I think that -- CHEST of last year in October, when we were able to show nearly a 70% reduction in invasive procedures that weren't necessary. We think that's meaningful.

It matters. And we've seen that data be requested. We've got a lot of skilled professionals out there talking about it, so we're really excited. I think you're spot on the timing and we're looking forward to submitting the full data package for ORACLE here, and hope to share news on a publication that might occur in 2022.

Robin Harper Cowie -- Chief Financial Officer

I would also add to that the ORACLE is important for reimbursement as well. Payers don't want to pay for things that don't impact care. And so this data really shows not only are we impacting outcomes, but impacting physician decision making and helping to reduce unnecessary procedures, and so we think it will be beneficial for reimbursement as well. [Inaudible] the full publications out.

Sung Ji Nam -- BTIG -- Analyst

Fantastic. Thank you so much.

Operator

[Operator signoff]

Duration: 46 minutes

Call participants:

Chris Brinzey -- Investor Relations

Scott Hutton -- Chief Executive Officer

Robin Harper Cowie -- Chief Financial Officer

Brian Weinstein -- William Blair and Company -- Analyst

Kyle Mikson -- Canaccord Genuity -- Analyst

Yuko Oku -- Morgan Stanley -- Analyst

Sung Ji Nam -- BTIG -- Analyst

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