Greetings. Welcome to CareDx Incorporated Second Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. Please note this conference is being recorded.
I will now turn the conference over to Greg Badachuk. Thank you. You may begin.
Thank you. Good afternoon and thank
you for joining us today. Earlier today, CareDx released financial results for the quarter ended June 30, 2020. The release is currently available on the company's website at www.caredx.com. Peter Ma, Chief Executive Officer and Michael Bell, Chief Financial Officer will host this afternoon's call. Before we get started, I would like to remind everyone that management will be making statements during this call that include forward looking statements within the meaning of the federal securities laws, which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.
Any statements contained in this call that are not statements of historical fact should be deemed to be forward looking statements. All forward looking statements, including without limitation, are examination of historical operating trends, expectations regarding coverage decisions, pricing and enrollment matters and our future financial expectations and results are based upon current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results to differ materially from those anticipated or implied by these forward looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with our business, please see our filings with the Securities and Exchange Commission.
The information provided in this conference call speaks only to the live broadcast today, August 4, 2020. CareDx disclaims any intention or obligation, except as required by law, to update or revise any information, financial projections or other forward looking statements, whether because of new information, future events or otherwise. This call will also include a discussion of certain financial measures that are not calculated in accordance with generally accepted accounting principles. Reconciliation to the most directly comparable GAAP financial measure may be found in today's earnings release filed with the SEC. I will now turn the call over to Peter.
Thanks, Greg, and good afternoon, everyone. I'm pleased to welcome you to CareDx's call to review our results for the Q2 of 2020. Back on April's call, I began by talking about how we chose transplant route as our theme for 2020 and how proud I was of our team's response to the COVID crisis. Today, I can say that our team has taken CareDx to a whole new level. The dedication and resiliency of every member of CareDx is truly inspiring.
I want to thank our employees and say you have made the lives of transplant patients and their caregivers better because of your grit, your hard work and your devotion. You exemplify what essential businesses and workers stand for. Thanks for leaning in. Now turning to our exceptional results for the quarter. In the Q2 of 2020, we reported revenue of 41,800,000 an increase of 33% compared to the Q2 of 2019.
Growth primarily came from our testing services with revenue of $36,300,000 We provided over 17,100 AlloSure kidney and AlloMap heart patient results, an increase of 44% year over year. Product revenue for the quarter was $3,300,000 and digital revenue added $2,200,000 to the top line. We believe that these are exceptional results in a challenging environment. During this crisis, we have chosen to invest strategically in areas that will accelerate the building of our mode in transplant care. We are leaning in.
These strategic areas include our direct to patient capabilities and our clinical activities, especially those focused on our multi modality testing and digital solution. These investments will all accelerate our precision medicine offerings in transplantation. Our digital acquisitions have proven to be a tremendous asset as it has enabled us to pivot faster than anyone in the industry in building out our offering. Transplant Route. In the latter part of March and throughout the second quarter, several cities experienced rapid increases in newly confirmed cases of COVID-nineteen.
With these increases came more requests from physicians and patients for RemoTrak and mobile phlebotomy. As a result, our RemoTrak services has experienced continued growth. For the quarter over 40% of our patients results originated from RemoTrak or other mobile phlebotomy services. Under the tremendous leadership of Resideo, in just over 4 months, Remodrack has gone from an idea, gone from conversations with clinicians to a full service offering that now originates a significant proportion of our patient results. Remodrak has provided patients peace of mind by giving them the to avoid transplant centers and physician offices thus reducing the risk of contracting COVID-nineteen.
To date, around 150 transplant centers are offering RemoTrak to their patients and over 4,000 kidney, heart and lung transplant patients have enrolled. Our nationwide network of mobile lebotomists has grown to over 10,000. Not only have we had to change the way we call on customers, but the pandemic has also changed the way we communicate and present important clinical information to leaders in the field of transplantation. In late May, at the virtual American Transplant Congress Annual Meeting, our program included virtual abstract sessions, virtual symposia and prominent office delivering 10 abstracts. Cutting edge content on AlloSure, AlloMap, Ibox and Kidney Care was presented.
Having 10 abstracts accepted for presentation at ATC and having over 1,000 clinicians, patients and investors log on to our virtual sessions was exceptional and quite an honor for our clinical team, which is led by Shandralakia. The large turnout for our virtual events demonstrates our leadership position in transplant care as we are at the forefront of innovation in this space. Others might be talking, CareDx is doing and the field is recognizing our efforts and our dedication. We are also using these new tools to communicate to clinicians and patients and during industry conferences and interactions with the transplant community. We are very encouraged by the positive feedback from nephrologists, cardiologists, transplant coordinators and patients about our virtual advisory board.
We have and will continue to virtually support our customers and to call on our physician advocates and transplant center administrators to every extent possible. While we have successfully pivoted our testing services business with exceptional success, we also point out that our product business with its many launches has been negatively impacted by the COVID pandemic. Hospitals and transplant laboratories across the U. S. And Europe have restricted access to their facility for outside personnel.
In May, we received CE Mark for AlloSeq TX17, our best in class solution for HLA matching of transplant donors and recipients. Despite providing better care for patients by extending the typing range to non classical HLA low side, Fraction of our launch efforts will be delayed in the U. S. And Europe due to the COVID pandemic. While our product revenue is not what we had hoped for, we had the chance to welcome exceptional talent into this group.
With Paul Tausch, we added strong commercial leadership from Thermo Fisher. Paul has been leading the success of One Lambda with Doctor. Terasaki for over 25 years. Turning to our operations, we continue to adapt to a dynamic COVID environment in transplant centers, hospitals and even within our own facility. We have established internal operating solutions to protect our employees and their families, while continuing our commitment to supporting patients.
Despite COVID affecting many large cities across the United States, I'm pleased to report that we have continued our operations without interruption. We are firmly committed to our mission and we never favored from our commitment to prioritizing patients. With respect to our ongoing clinical studies as one would expect, we did see a slowdown in enrollment in Orkraf during the Q2. However, we experienced an increase in SHORE and utilization of heart care as many centers have switched their biopsy protocol to non invasive surveillance. Our heart franchise has been exceptionally strong in the Q2 and the value proposition of our precision medicine solution has never been clearer.
In the Q2, we recorded our first ever Allocell revenue. While it was only a small amount of revenue, it clearly demonstrates the next step in expanding our transplant technology from solid organs to cell therapy. To pursue this, we have built an exceptional team with strong business development hires as well as elevating internal talent. While we are in the proof of concept phase, we have fielded many inquiries from pharmaceutical and biotech companies of all sizes. We are very excited about the opportunities in cell therapy and we will continue to update you on our progress.
Finally, turning to the balance sheet. The 2nd quarter saw significantly strengthened our cash position. We closed the quarter with $211,000,000 of cash following a very successfully executed public offering in June. Mike Bell and the team have done an exceptional job. We feel we now have the right sized balance sheet to continue to accelerate our revenue growth and take full advantage of opportunities available to us.
Before I turn the call over to Mike, I would like to take this opportunity to thank our employees again. We are firing on all cylinders. We provide our services to more transplant patients every day. I'm very confident the best is yet to come. As you can tell, I'm optimistic about the remainder of 2020 and look forward to providing updates on the progress in future communication.
Now I'll hand over to Mike to discuss our financials. Mike?
Thanks, Peter. Turning first to the income statement. Total revenue for the Q2 was $41,800,000 a year over year growth of 33%. Growth in revenue was primarily driven by AlloSure kidney and AlloMap Heart. We saw increased penetration primarily due to the success of Remotrek and the need for centers to be able to monitor their patients remotely.
As a result, testing services revenue in the Q2 increased 41% year over year to $36,300,000 Our 2nd quarter product revenue decreased to $3,300,000 due to the COVID related issues outlined earlier by Peter, and our digital revenue was $2,200,000 Moving to our gross margins. For the Q2 of 2020, the gross margin was 64% compared to a gross margin of 63% in the same period of 2019. The non GAAP gross margin for the quarter was 68% compared to 67% in the prior quarter. On a sequential basis, the non GAAP gross margin was down approximately 300 basis points compared to the Q1 of 2020, primarily due to the increased number of tests originating from Remotrek or other mobile phlebotomy services. As a reminder, the cost of a mobile phlebotomy draw can be between $100 $150 more expensive than a lab draw.
Although the incremental cost of RemoTrak and mobile blood draws are here to stay, we are still confident that gross margins will continue to improve over time due to the operating leverage of our testing lab in Brisbane. For the Q2 of 2020, net loss was $6,600,000 compared to a net loss of $7,800,000 in the same period of 2019. Our net loss per share was $0.15 for the quarter compared to a net loss per share of $0.19 in the Q2 of 2019. Non GAAP net income was $1,700,000 in the Q2 of 2020 compared to a non GAAP net loss of $100,000 in the same period of 2019. Our non GAAP net income per share in the Q2 of 2020 was 0 was 0 point 0 $4 compared to a non GAAP net loss per share of 0 point 0 $0 in the same period of 2019.
Note that both GAAP and non GAAP net income in the 2nd quarter include other income of 4,800,000 dollars related to the Cares Act provider relief funding that we received in April. As a reminder, we define adjusted EBITDA as non GAAP net income before interest, income tax, depreciation, amortization and other income and expense. For the Q2 of 2020, we recorded a negative adjusted EBITDA of $2,800,000 compared to a positive adjusted EBITDA of $100,000 in the Q2 of 2019. Our adjusted EBITDA in the Q2 of 2020 was impacted by the cost of Remotrack and mobile blood draws as well as increased spending in the R and D and G and A lines. For research and development, our clinical study expenses increased due to an uptick in activity in our SHORE study as well as upfront costs related to the Euromap development agreement signed with Cornell in May.
Our G and A costs increased sequentially in the Q2, primarily because of the higher legal expenses related to our ongoing litigation efforts. We also booked additional employee related expenses to reflect the remarkable performance of our employees during this highly unusual quarter. Peter had mentioned that we are leaning in and seizing opportunities to build out our moat during this crisis. Therefore, we expect operating expenses to increase in the 3rd and 4th quarters this year. We will continue to develop our pipeline and continue to focus on top line growth.
We will also expand our sales and marketing efforts beyond transplant centers by going direct to patients and to community nephrologists. In the Q2, we significantly strengthened our cash position. In April, when the COVID crisis and uncertainty was at its peak, we utilized our at the market program to raise approximately $24,000,000 We followed that in June with a successful public offering of approximately 4,500,000 shares of common stock raising roughly $135,000,000 As a result, cash and cash equivalents on June 30, 2020 were $211,000,000 And as Peter outlined earlier, this puts us in a position of strength to execute on opportunities to build up on our transplant platform. Net operating cash flow was $24,100,000 in the Q2 of 2020. This includes both the $4,800,000 Cares Act Provider Relief Funding we received in April as well as the $20,500,000 we received from CMS through its expanded, accelerated and advanced payment program.
As a reminder, we expect CMS to recoup the advanced payment between August November this year. Turning to guidance. Whilst we have seen many transplant centers return to some level of normality over the last couple of months, there is still much uncertainty surrounding the ongoing impact of COVID-nineteen on our business. And as such, we will not currently be providing revenue guidance for the full year 2020. I'll now hand back over to Peter.
Thank you, Mike. In closing, the Q2 was an exceptional quarter for CareDx. With COVID-nineteen limiting access to hospitals and transplant centers in the United States, our team continue to roll out solutions like WEMO DRAC across the country to bring much needed surveillance testing to transplant patients. We believe we are experiencing the beginning of a tectonic shift in the way clinicians are monitoring the health of transplant patients and precision medicine overall. The movement towards DNA and molecular testing from traditional biopsies is happening and we are well positioned for the shift, but importantly we are also the reason for it.
Thank you all for joining the call and I will open the call for questions.
Thank Our first question is from Brandon Couillard with Jefferies. Please proceed.
Thanks. Good afternoon.
Peter, just on RemoTrak, I'd be curious to just get your cognifications of where you think that program can go, the portion of volumes you think it contributes in the back half of the year? And is there some upper level where you think there will just be a remaining portion of the market that just won't convert to a mobile lobotomy model? Can you just speak to where this program
kind of goes next week or so?
Thank you so much, Brandon, and greetings to Nashville. Good to have you on the phone. So thank you very much for joining. Now RemoTrak is embraced by patients. They love it.
It's an amazing service where we have lebodemists going to the home of the patient and make sure that they get the blood draw in the convenient environment that they're used to. And so they don't have to go to transplant centers. And this has been embraced by many patients across the country, 150 centers are using the service now. Now, we have 4,000 patients on the platform. That number is growing every day, but it's really depending on where transplant centers are and what their stance is towards telehealth.
Some centers have really jumped in and adopted telehealth solutions. Some other centers are actually moving now back as they're reopening up to face to face visits. And so it's hard to say. That's one of the reasons why Mike said it's hard to give guidance yet because there is a lot of variability across the country. But RemoTrak as a service is here to stay.
We're all in. We have invested into the platform and there are many, many patient care managers now on CareDx that are servicing this patient population. So there is significant growth drivers going forward.
I think you talked about loss in
the Alacare app later this year, maybe by September. Mike kind of mentioned some more direct to patient marketing programs. Are those 2 tied together? Sort of talk about what that app is, how it helps you actually capture more volumes and kind of what the spend and marketing plan looks like around that initiative?
Yes. Thank you very much. This is in the broader context of CareDx managing the transplant patient journey. And you hear us with RemoTrak, the reason why we were able to pivoting so quickly was having our digital solution encompassing our surveillance testing modalities. Now with AlloCare, we are prone to tackle one of the biggest issue in post transplant care, which is compliance and adherence to a standardized protocol.
And we are all about standardization, so we can further individualize the offering. With AlloCare, we are now having a simple patient app that allows the patient to monitor their schedules, to be able to monitor their medications and maybe even build a community for transplant patients. So we're very excited about this. This is another touch point for CareDx with a patient that makes sure that there is patient journey. So AlloSure AlloCare is launching in September and we're very excited about that launch.
Okay. Thank you.
Our next question is from Rachel Basenal with Piper Sandler. Please proceed.
Hi, this is Rachel on for Steve today. Congrats on the nice quarter and thanks for taking the questions. So first off, can you just give us
an update? Yes. So first, can you just give us an update
on the transplant pipeline and impacts on donations due to the pandemic or if you start to see that pipeline return as geographic regions have started to open back up?
I think overall transplant volume is roughly about 7% down year to date. So a very, very nice recovery because we obviously living donations have been stopped for a few weeks. But as we look around the country right now, many transplant centers are back to normal or maybe even overcompensated because transplant centers are really at the forefront of wanting to come back and supporting. Now transplant volumes is back up and we don't see that this will double down even so we see some cities might being in hotspots of COVID because the organs will be reallocated to other parts in the country. We have seen that in when there were issues in Detroit, actually Cleveland was taking over the organs and we have had a significant surge in transplantation in Cleveland, overcompensating the down go in Michigan and Detroit.
So the system is very adaptable. And so we think that for the next 6 months to come, I think transplant volumes will be back up.
Great. That's awesome. So then on the OCCRENGE 4 study, so can you give any more clarity on the timing and if enrollment has returned given those delays you saw due to COVID earlier this year?
Yes. Sure. The context of AlloMap and AlloSure is kind of standard of care now. It's so well penetrated. I think CareDx has defined for many years with AlloMap post transplant surveillance that was non invasive.
But now in this COVID era, we have seen a tectonic shift away from biopsies really into non invasive procedures. And so the SHORE trial and the combination of AlloMap and AlloSure has really demonstrated the power of our platform moving away from biopsy driven protocols over to post transplant surveillance. I think with OPERA being a more sophisticated study where we have AlloSure plus AlloMap kidney plus the Ibox scoring that is more driven by research coordinators and research events. And so we have seen some research coordinator being furloughed, some research activities actually put aside in these kidney transplant centers. And so on kidney, we have seen a small delay on the ACRA recruitment.
But actually as we are reopening up the country, the last weeks have been very promising on our recruiting of our OPERA study. I will say as well is that we had a phenomenal second quarter even without OPERA being supportive. So this really speaks testimony to the value proposition that we bring to transplant centers overall.
Great. Thank you. Those are all my questions.
Thank you, Rachel.
Our next question is from Alex Nowak with Craig Hallum Capital Group. Please proceed.
Great. Good afternoon, everyone. In the centers that have moved from doing more AlloSure and AlloMaps during the heart of the pandemic and essentially going away from biopsy and irregardless of if they're doing Green Bone Track or not, has there been a durable benefit as these centers have reopened and try to go back to normal? I guess said another way, do you think this pandemic at all has accelerated your penetration goals into some of those transplant centers?
I would say from the proof is in the pudding and we'll need to see that in a couple of quarters, but absolutely. I think we have seen a true shift away from biopsy protocols into non invasive procedures. I've talked to so many cardiologists that said we always wanted to retire our biopsy protocol and maybe now is the time to do it. Now the reality might be that some of them are going back on to biopsy. We'll see that in the past.
But if you see the feedback from patients that don't have to spend more or less a day in a cath lab and go through an invasive procedures and now they are doing this for the blood test. You wouldn't believe how many positive patient notes I receive and the entire team receives from patients that are saying, well, this is so much more convenient and not being able to do that from home even better. But I think there's a true shift in care, but yet to be seen, right? I mean, this is 1 quarter and I think the heart franchise has been extremely successful. But I think this is something to stay.
That's great to hear. And of the 4,000 RemoTrak patient, how many would you say are brand new to Curedi X? And just on RemoTrak in general, can
you say
if compliance has actually improved compared to the traditional getting a blood draw in the clinic? Because I remember that being a core piece of the Remotrack piece is that compliance would increase.
And Alex, you have followed the story for a long period of time. So I don't wonder why I'm not wondering why you are asking that question. We ourselves are looking at these numbers very, very carefully. There have been a number of new patients come on to the RemoTrak franchise. And it's probably true that some patients have been pushed out for a few weeks or another quarter for their surveillance visits.
But I think this is a brand new trend. I think Remodrac has been exceptionally successful in areas where COVID hit extremely hard like New York or now we're seeing some uprise in Florida and guess what, RemoTrack is just accelerating. But I think we'll need to give ourselves a couple of quarters to really demonstrate how much is Remodrache there to stay, what is the impact on surveillance and I think what you're getting at, what's adherence? With CareDx now being much more aggressive and intimately involved in the scheduling of patients, we think that long term there will be a significant upside for us to manage these adherence rates. But again, we need to make sure that we demonstrate that yet.
And 1 quarter is not time enough in these quarterly follow ups to really determine if we're successful in doing that. I'll maybe ask Regito also to comment on RemoTrak and the patient adherence. We actually significantly invested into our patient care management group. Reg? Yes.
Thanks, Peter. Remotract's been a hi Alex. Remotract's been an outstanding success. And I think we've obviously added new centers, new patients, as well as adherence has gone up. And Peter has mentioned this is obviously from a 4 month sort of experience that those all those three parameters have been certainly seen during the period of RemoTract along the 4,000 plus patients that we've had enrolled in this program.
All right, understood. And thanks, Rich, for that. And then just last question for me. Any update on heart care reimbursement, where that sits with CMS and MRIdian and Palmetto? And then when would you expect to request kidney care reimbursement?
Excellent questions. I'll give the kidney care, this is really too early yet for us to comment on, Alex. We'll probably see this communicating about our reimbursement timelines on kidney care once we have clarity on heart care. And I'll punt that question over to Mike Bell on heart care.
Yes. On heart care, Alex, I think no change from really the status last time we spoke. We're still expecting that to go to the final coverage decision towards the back end of the year. It's usually within 12 months from the public comment period, which was October of last year. So we're expecting something around that timing.
All right. Understood. Thank you, everyone.
Alex, keep the fingers crossed for us in the Q3, right? So thank you for doing that.
Our next question is from Andrew Cooper with Raymond James. Please proceed.
Hi, thanks for the questions. Maybe just first, I think, Peter, you mentioned it at least as potentially part of what went on in the quarter. But just do you have any sense for was there any amount of volume that might have been delayed from 1Q or sort of adjusted based on Remotrac becoming available that we should think about as we think about pacing kind of through the remainder of the year?
Excellent question, Andrew. And we finished obviously the Q2 very strong. And we see that trend continue into the Q3. I think on the heart franchise, we are looking at our numbers and saying this has been very, very strong in the Q2. Will that momentum carry on throughout the rest of the year?
So I think that's a good question. On the kidney volume, I think the value proposition, at the end of the day, we are so low penetrated overall. So this is such a big opportunity that we are here to stay and then build the franchise going forward. So in that sense, there's so much ample opportunity. Now we did comment on the side note as well is that we are building out our presence in community nephrology.
So there's going to be an ongoing expansion for CareDx, a tremendous field to grow going forward. So in that sense, we see continued growth going forward.
Thanks. That leads actually right into the next question I wanted to ask, which was on that community nephrology effort. Is that when you think about that, should we think about this as building direct kind of 1 by 1 in the hospital settings or community settings? Or is there an opportunity to maybe partner with some of the larger players that are interacting with ESRD patients and patients that presumably are coming on to transplant lists? What's the way we should think about you trying to address that?
Thank you so much, Andrew. You've been following the company as well. And we're all about the continuity of care, the transplant patient journey. We're managing patients on the wait list. We are managing them during the transplantation procedure.
And then we are managing them also post transplant. Reg C2 has actually masterminded our presence into the community nephrology setting, which is a very natural progression about growing our franchise, expanding from a transplant center now into the community nephrology setting. So it's a very, very natural evolution. Over to you, Rich. Yes.
Thanks, Peter. I mean, I
think with more than 150 centers quarter on quarter actively using AlloSure, we've had deep penetration within the centers. And now we're 3 years on, we have patients moving community year 2 year 3 and obviously year post year 1. So with that in mind, we've been able to develop a plan which allows us to now strategically follow these patients and also bring new patients into the world of AlloSure. So that's something that we have a team that's being built out to allow for that expansion as part of their process.
Great. I'll stop there. Appreciate the question.
Our next question is from Yi Jin with H. C. Wainwright. Please proceed.
Could you please comment on the transplant volume in Q2 and early Q3 as compared to those in prior periods? And do you think the transplant volume will continue to go up during the remainder of 2020 or remain at current levels for an extended period of time due to the new COVID-nineteen cases in the country?
Excellent question. I think this is really driven by 2 dynamics. 1 is living organ donation is back to previous levels and deceased owner donation has actually never stopped. So in a way your question is about will living organ donation continues to increase and I would say yes. I think there was a shell shock reaction in many transplant centers during COVID-nineteen that said, oh, we're backing off.
And now as they have learned how to deal with the crisis, we see actually a significant increase. The latest numbers on organ availability, these are actually significantly increasing due to COVID-nineteen because of cardiovascular death and believe it or not because of overdosing. So there's a lot more patients unfortunately that are overdosing and there are more patients that are sedentary at homes that are experiencing cardiovascular deaths, which leads to an increase in organ availability with the need increasing need of organ transplantation because we have 100,000 patients on the waiting list on kidneys. So in a way, I see a significant increase, which is also driven by a support of kidney health initiative from CMS, which you might have read last year that we're kind of releasing, the 1 year graft survival metric as the key quality metric for transplantation. And releasing that metric really allows transplant centers to do take a little bit more risk when we are transplanting and not only taking perfect kidneys, but also taking kidneys that are okay.
And that will drive volumes. And the last thing that I would say, Eugene, is that many of these centers are also financially driven institutions and transplantation is a profitable activity within a hospital. And as we read now, many hospitals are looking for sources of income, transplantation might be an easy area to be because you have relatively low case rates, but these are tend to be pretty profitable. So I think all these things will play to a significant increase in transplantation throughout the rest of the year.
Got it. Thanks. My next question is related to operating expenses, which have increased in Q2. Was that simply a result of the investment in RemoTrak and other COVID-nineteen related solutions? And do you expect that to remain at such levels as COVID-nineteen continues to spread?
I like Mike to speak about our operating expenses. But what we will see is that we're all in. I think this one we've taken out some stops and really invested heavily, especially in our direct to patient activities. And we'll see what sticks. I think you have seen us as a company being extremely responsible and extremely focused on building a long term sustainable business model.
But this was the quarter where we said no, we're going other companies might go another way, but are going all in. And so I'll turn over to Mike, which can give you more detail.
Yes, Yi Chen. I think on the Remo track side, most of the impact that we saw actually was in the cost of goods line and impacting our gross margin. On the call earlier, I talked about a 300 basis point impact from Remotrac on the gross margin. And so we'll probably see those costs are here to stay and we'll see them going forward. On the OpEx side, there was cost related to RemoTrack in that we built out our patient care manager and our direct to patient capabilities in some extent.
And as Peter mentioned, that's going to continue in future quarters as we want to touch more and more patients. We also had increases on the OpEx side on the R and D line. Again, some of this COVID related as we saw more expense related to SHOR and more uptake of heart care. But then some of those costs were non related to COVID. We had this upfront to Cornell.
So that's for developing the pipeline and that was for Euromap. And then on the G and A line, we also had some increase in the in our legal expense line. But yes, I mean, overall, as Peter mentioned, I think going forward, we see a bit of a change in the business model, and that will drive some additional expense. But again, it's all focused on top line growth.
We have reached the end of our question and answer session. I would like to turn the call back over to Peter for closing comments.
Well, thank you very much for your interest in CareDx. We will continue to keep you updated as we are going into the second half of twenty twenty and looking forward to keep in touch with you. Thank you so much. Bye bye now.
Thank you. This concludes today's conference. You may disconnect your lines at this time and have a pleasant evening.