being here. I'm Patrick Donnelly, the tools and diagnostics analyst here at Citi. I'm going to have Mike and AmirAli with us from Guardant Health, talk a little bit of screening, a little bit on the financial side. But yeah, AmirAi, maybe to start, you know, certainly the news last week that seemed to get the most attention was, was the AdCom piece. So maybe we can start there, and just, you know, maybe tell us what happened. It seemed like it was an FDA decision, and kind of this, this panelist filling the panelist spot, but I'll, I'll leave it to you to kind of tell us what happened and, and where we go from here.
Yeah, sure. So, yeah, it's all logistics and scheduling related. So FDA initially told us tentatively they are planning to have this AdCom end of March, and then, very recently, they notified us that they cannot do that, and now they're planning to do it late Q2. The reason that they told us is this panel, which supposed to have 10 members, just have 5 members, at the time that they sent the initial notification to us. They need to find new panelist members, vet them, and then schedule the meeting based on availability of all the panel members. So hence they said that, you know, that March 28th would not be practical. I think something to note, though, this does not impact the overall timeline for the FDA review cycle.
This AdCom just happens somewhere in the middle of the review cycle, so, this should not generate any kind of delay, to get any kind of decision by FDA about applicable to get shipped.
Okay. And in terms of kind of when the AdCom is expected to happen now, what's your expectation?
Late second quarter, you know, that's based on what FDA told us. So, and we are very excited to get to that time point. It's like 3-4 months from now, and by that time, we are gonna have a lot more clarity and further confirmation about the progress that we are making in this FDA review cycle. And, our team is working very hard and excited to get to this milestone.
Yeah, and maybe on the panel, I mean, we've gotten questions just about what they're reviewing. Some people still ask, "Is Freenome gonna be involved in it? It's just you guys." Maybe you just got to clarify what the panel's about.
Yeah.
It is just you guys, but, at least my understanding. So yeah, maybe just kind of talk about what the panel's looking at, what the outcomes could be.
Sure. So this is an AdCom in the review process of Shield PMA package. So what's gonna get discussed there is trial, device, background information of Shield. We are gonna present first, FDA is gonna present an open public comment hearing section, and then some question and deliberation between panel members. And then they go to a voting, which is a material part of that day, really, at the end. And the votings are about three questions: Based on everything you heard today, is this device safe? Is this device effective, and would benefit outweigh the risk? This is at the high level. Still, we don't know the detailed agenda in terms of the kind of questions or deliberation topics that FDA is gonna bring up. But at high level, this should be the overall structure of that day.
Yeah. I think with the FDA, a lot of people kind of go to things like drugs in terms of the approval, to your point, safety. What is the bar in terms of being safe for a diagnostic, like Shield?
So in terms of safety, like, at the end, we are blood test, and the safety, the direct safety parameters are just associated with safety of blood draw. So, you know, there's nothing unexpected there. We quantify that as part of our clinical validation study, the ECLIPSE. So those mean numbers are going to get actually disclosed, but it's like phlebotomy, the risk and adverse events associated with phlebotomy. So that's all. There are some kind of indirect risk that also get kind of considered in terms of, if there are false positives or false negatives with this device, what does that mean in terms of the safety profile of this test? The good thing about Shield is we passed all the endpoints of this study in terms of minimum performance, sensitivity, and specificity for CRCs, so we are in good shape on that.
Yeah, and then I guess the outcome in terms of first line, second line, maybe just talk a little bit about that. I know you guys have done a nice job kind of sizing up the market for both sides. Maybe we'll talk through that as well.
Yeah, thanks for asking that question, because I think this is something that... In fact, I think it's a misunderstanding on the market side. So when you look at 120 million people who are average risk colon cancer screening, age 45-84, out of those 120 million, 55 million of them are getting screened through colonoscopy today. About 15 million, they're getting screened through a stool-based methodology, FIT or Cologuard, and 50 million are unscreened. So first line indication is effectively for the whole 120 million, based on the label of the test... but commercially, the reality is colonoscopy is the first-line test by doctors. When patients have access to colonoscopy, and it's okay to go through that procedure and have the means to go through that procedure, that's the first line.
So the commercial opportunity, really, for first-line testing is 65 million people, the people who are not going through colonoscopy today. Commercial opportunity for second-line is for 50 million unscreened patient population. And logistically, the delta between first-line and second-line is a difference in physician attestation when they order the test. The difference would be for second-line, the doctor need to attest that this test is clinically necessary, and the patient is unwilling or unable to go through other modalities, and order the test, accordingly. That would be the difference. We have good confidence that Shield would be a successful brand as long as we get FDA approval, even for that label, because of commercial experience that we have with Shield LDT too. Like, we've been selling Shield LDT as a second-line test now for about 2 years. We have market feedback.
We've seen the product market fit. We've seen that how the doctors have ordered this test and responded to our message. We've seen the depth of ordering. So, as long as we get FDA approval, I think Shield is gonna contribute to Guardant in a very meaningful way.
Yeah, and maybe just in terms of... You mentioned the LDT launch. What are the kind of the key learnings been? I know you talk a lot about, you know, the willingness, the adherence rate in terms of kind of the willingness to do a blood draw versus maybe stool or colonoscopy. So maybe just talk about, you know, being on the market for a little while here, what you learned.
Yeah, sure. So in the first 20,000 cases that we've done, 94% of the patients completed the test. It's very different than in colonoscopy and stool-based test. That level of completion ranges between, like, 35%-65% or 70%, and that's really the unmet need in the field of CRC screening, how to increase compliance rate with the way that the current modalities have not been able to do, and Shield, we have that real-world evidence that we can do that, at sizable number of accounts throughout the last two years.
The other KPI that we pay attention is the depth of ordering when we let the accounts to really order deeply, 'cause we are managing the volume, we are depleting the kits, but when we let them to go and run, we are seeing the depth of ordering in these accounts for blood is very respectable. So when you combine higher depth of ordering, when you combine, higher completion rate, that translate to higher efficiency of S&M and directly contribute to the profit margin of the brand. You don't have losses sale, right? So we are excited about all this confirmation that we've seen in the marketplace.
Yeah, and then in the panel, again, I think people ask, talk intervals, reimbursements. It's clearly not in your expectation that the FDA would weigh in on that, but maybe just your perspective in terms of, is there potential for them to discuss that part, or is that left for CMS payers type role?
Yeah, like, it's, it's very unexpected, if, like, pricing and those, like, you know, the reimbursement would come. In fact, an area that is the promise of blood tests is having an equitable, accessible test for underserved patient population, you know? In fact, this is a positive thing for a brand like Shield versus a negative thing in terms of those kind of conversation, but we don't expect anything about cost of care and those matters to come.
Then maybe on Shield, you guys have already talked about a V2. Maybe just talk about what improvements you've seen, what the catalyst set on that front would be just in terms of timing, data, things like that.
So as a reminder, with Shield V1, not last December, the December before, we saw a very solid performance from our perspective of 83% CRC sensitivity with 90% specificity, and effectively, like, 100% sensitivity in detecting Stage II colon cancers and above. So, and what we've shown so far in some kind of case-control studies, when we use our upgraded Shield test, which we call it Shield V2, on a set of CRCs, V2 detects more CRCs than V1 on the same cohort. We show the data on 45 CRCs that, for instance, V1 on that number of CRCs detected 84% of the cases, similar to what we saw, interestingly, to our ECLIPSE PMA study, and V2, in that the same cohort, saw 91%. What we are confident is V2 is more sensitive than V1.
Now, the exact delta, we have to see in a pivotal study, what we are gonna see. But that gives us actually confidence that as long as we get V1 to the finish line with FDA and get FDA approval, we can go through this upgrade cycle and even upgrade the performance claim of Shield within a reasonable timeframe. Like in our Investor Day, we talked about potentially we could have this upgrade sometime in 2025.
... Yep, and maybe last one on Shield, and then we'll loop Mike in on some of the numbers. Just in terms of, you know, the panel, things like trial design, we've gotten asked about, I'm sure obviously you have as well. Are you comfortable, you and the FDA have obviously had some back and forth ahead of this. Has that come up? What's everybody thinking about just the, you know, the trial design portion and the FDA being happy, comfortable, whatever you say, do on that piece?
The review process is still ongoing, like this review process, till we get the PMA letter at the end from FDA, still we are under review. As I mentioned actually before, I'm pleased with the progress that we made, and we continue to make steady progress throughout this review process. Again, it's not done till it's completely done. But so far, we are making good progress.
Okay. Go ahead, Chris.
Just to follow up on the dynamic with Freenome. I think you guys did a straight, you know, genomics and then a proteomic multiomics test to get them to phase. I think they are adversary. They talk about using a multiomics type assay. Yours was actually better when it didn't have the protein aspect there. If you could sort of reflect on why you think that was, and then maybe your expectations for, you know, what do you think that their assay would look like compared to yours?
So I'm actually pretty excited, frankly, that after 15 months of waiting for them to, you know, show their cards, you know, the timeline for USPSTF is forcing them maybe to show their cards at the end. So, we are very excited to get to that point, and frankly, just, see what they have and what we have. And about some of the details of lessons learned since we are in this business for a much longer period of time and we have some time advantage, maybe we can talk more details after they show their cards.
Okay.
But, you know, I mentioned previously that, you know, for clinical-grade assays, you know, it's a tough undertaking. Even like, if we thought that the cell-free DNA plus proteomics has a low probability of success, we wouldn't do the dual testing that way, so we would just do cell-free DNA only. So much of it was learning for us, too. But we'll see. In a few weeks, I think we're going to see what data they have.
Was there a level of surprise from your guys' side when you saw that assay kind of perform worse? What, what, I guess, was your kind of read on that? Why did that play out in terms of your own kind of dual assay?
What scientifically we know, proteomics is a more finicky biomarker. Still, you can have some clinical test based on proteins, but the stability of cell-free DNA is not easily to beat. When you are adding another component to cell-free DNA, it means you are taking some budget off cell-free DNA to give it to other modalities, right? You need to think about, was that the best decision to give that budget to proteomic or other modalities, versus still committing to that extra budget to cell-free DNA and squeeze more out of this, right? That's what we saw, but again, maybe we can have more conversation after cards kind of put on the table, so.
Yeah. And one more just on V2, what would the process look like with that in terms of, you know, let's assume you get the PMA on V1, what does the follow-on process look like for kind of the improved assay Shield V2?
We need to actually coordinate a clinical study plan with FDA in terms of exactly like how many new CRCs they want us to run, unblinded CRCs they want us to run with that V2 to confirm that this algorithm is actually improving the performance. And after alignment with FDA, running that study and then submitting that package, you know, as an upgrade to the currently approved PMA device.
Mm-hmm.
When you look at the sequence of event that could happen, potentially we could have that kind of a upgrade sometime in 2025.
Okay. And then, Mike, just on the numbers, I guess you guys kind of pulled Shield out of the guidance. Maybe just talk about the moving pieces of the guide. You know, it doesn't... Yeah, go ahead. Yeah, I don't think Shield is in there, but-
No, no, Shield's definitely not in the guide. And I think, yeah, I mean, obviously, I think we'd have been a bit silly to put some Shield numbers in there because we've got to go through an FDA approval process, and then, you know, after that, we need to get the initial Medicare rate, and so that we'll have an initial sort of gap fill rate before we get to an ADLT rate, and so that's a little bit of an unknown. And even the timing of that and how we can recognize revenue on that is an unknown. So, you know, our revenue guide is purely on therapy selection and MRD.
Yeah. Okay. Yeah, maybe on, on kind of the core business, either of you can answer, I suppose. Just in terms of, you know, the performance, I think you put up 29-30% volume growth in 4Q. Can you just talk about, you know, therapy selection, MRD, what you're seeing? You know, it feels like pretty good underlying trends there, but, yeah, maybe just, talk about the recent performance and expectations on the go-forward.
Yeah, no, you know, Q4, I think we finished the year very, very strongly. Guardant360 was the key growth driver. And in Q4 we saw - in the U.S., we saw growth, you know, across all cancer types, and so, you know, that was reflected in the sequential growth we saw in Q4 as well. And, you know, there was this issue where we'd had the bolus effect on breast cancer - impact on our sequential growth in Q3. So yeah, breast sort of grew again in Q4. So back to growth again across all cancer types. And naturally, that sets us up very well going into 2024, and especially a lot of the work that we've done in the U.S. on, you know, integrating into EMR systems.
By the end of the year, we're in 475 accounts, and so that's, you know, that sets us up very well going into 2024. Also in Q4, we started to see contribution from Japan and the U.K. You know, Japan got reimbursement coverage back in, in Q3, and so we start to see the volume there, and, really in Q4 was the first quarter of, rollout in our partnership in the, in the U.K. coming online with volume from the NHS. And so I think again, they set us up very well for 2024, and we're expecting contribution, volume, and, and revenue from both Japan and the U.K. And then, I suppose the other thing on, on Guardant360 is, you know, the ASP lift that we saw throughout 2023.
At the start of 2023, we saw we gained additional commercial coverage. That really started to come through in the back end of the year as the payer sort of started those payments started to come through, and so we saw good traction on that. We had that initial interim Medicare gap fill rate for Guardant360 LDT, and so, you know, we finished the year with a rate of around, you know, $2,750, and we know going into 2024, that rate, because of the new crosswalk rate for Guardant360 LDT from Medicare, the rates are going to be $2,850-$2,900, so that's a positive. And then, you know, maybe I'll just finish on the biopharma business. That came in very strongly again in Q4.
I think we booked the trend a little bit from other companies who saw really a decline in revenue from biopharma customers. We actually saw an acceleration in the back half of the year. So that was very positive, and we've got a good pipeline going into, you know, the first half of the year with biopharma. So I think, you know, it sets us up well for our 2024 revenue. You know, we guided $655-$670 million, and I think, you know, we see a lot of room for potential upsides on the ASP side, for volume for Guardant360 in the U.S. and internationally, and also in biopharma.
Yeah, great. Yeah, covered a lot of ground there. Maybe on the ASP piece, you know, to your point, you guys got that bump last year. Yeah, I think this year you're talking on the clinical side, at $2,500 + or something like that. I think the long-term goal is $3,000. I guess, what's the path getting there? Is it just kind of bringing on additional payers, does that bump give you room to talk to them and try to drive price alive there?
Yeah, you know, that, that guidance we gave out yesterday was that by 2028, we'd get to a $3,000 ASP for Guardant360. So I think this crosswalk for their LDT, it accelerates our path, our path to get there, definitely. And the thing that we've seen from the commercial pace in 2023, I think, you know, also accelerates that pathway. And there are, you know, there are upsides in 2023 on ASP as well. We've not factored into that guide of $2,850-$2,900, the potential uplift we might see from Medicare Advantage plans as well for their LDT, and, you know, they should move the LDT rate to from $3,500 to $5,000.
Mm-hmm.
So that, that always takes time to get those payers to recognize that increase in price. But that's, that's an upside, and again, I think having now two distinct CPT codes for Guardant360 with well-defined Medicare price at $5,000 just, really could enable us to pull through, yeah, better, better coverage and better rates from commercial payers. So I think, yeah, that, that $3,000, we just have a lot more confidence that we can get there, and hopefully, we can get there before, well before 2021.
Mm-hmm. Yeah, maybe on, on Guardant360, you know, obviously been a great, great product. Been around for a little bit. How do you think about just the growth profile here? What can continue to drive, you know, really strong volume growth? I know you guys are adding, I think it's a Smart Liquid Biopsy. Does that change things at all in terms of the, the long-term demand trajectory? Maybe just kind of talk Guardant360 a little bit.
Do you want to tell us there? Smart liquid biopsy. Right.
Yeah. No, I think moving to Smart Liquid Biopsy just, you know, further helps us differentiate the products and continuing that innovation. You know, there's. It's a competitive field in therapy selection. You know, we still see ourselves definitely as the market leader in liquid, but we want to keep on innovating and improving the product and improving the offering. So I think that enables us to continue growth. There's still, you know, a lot of blocking and tackling as well, that the getting integrated into EMR systems, getting embedded in workflows of our customers is again very important for us to do.
Increased coverage, you know, there's still room for us to get more commercial coverage, just opens the door to, you know, more patients getting the test, and so increasing the access. I think that's something we're very focused on. Things like, you know, the recent NCCN guidelines, where you can now have a liquid test with a tissue test, I think it's a positive for us on the liquid side, but also can boost the TissueNext for us as well. So I think there's, you know, there's many paths to continue growth, and that's just in the U.S. And again, you know, I just talked about U.K. and Japan, and we see those as, you know, could be very strong growth drivers going forward.
Yeah. And, and maybe we can jump over to MRD, you know, obviously been a big focus for you guys. Can you just talk about, I guess, the outlook there? I don't think you've ever given volume numbers, but just how you're thinking about the go forward. You know, there's a peer that reported last night, pretty healthy results, pretty healthy expectations for this year. Clearly feels like this market, big early innings, but yeah, maybe your outlook on the market, and then would love to talk a little bit in terms of your product offering versus others, in terms of tissue-informed, tissue diagnostic, things like that.
Yeah, I mean, we recognize it's a large market and a large opportunity. You know, we mentioned on our earnings call last week, you know, we're making significant investment in MRD. We'll invest over $100 million in MRD in 2024, and I think that's sometimes lost a little bit when people are looking at our P&L and trying to understand the burn. But a lot, you know, of our focus is on MRD and driving that. You know, the one thing that we're really focused on is developing clinical data. We need that because we need to expand reimbursement.
We've got reimbursement at the moment in CRC in the post-surgery setting, so we're focused on CRC surveillance and breast, and, you know, we hope to get publications in the near future and submit to MolDX. And really, when we get that reimbursement, that's going to allow us to really take our foot off the brake on volume and drive volume. And then, you know, we think we can really accelerate not just the volume, but the revenue growth as well. So yeah, we're trying to take a balanced approach until we've got that data and we've got the reimbursement, and then, again, yeah, we can really push hard.
Let me maybe add something to this MRD story. I think when you think about CRC, we showed a very good data for CRC in the surveillance setting, which that data meets the bar for expanding our Medicare coverage from adjuvant only to adjuvant plus surveillance. Now that we have that data, we need to get it published after publication, put the package in front of MolDX. So the risk of clinical data and, you know, the technology for expansion of that coverage actually has been removed, but it's gonna take us some time to prepare that publication and go through the process. That's gonna boost the ASP for Reveal in a very significant way and really change this Reveal brand from a gross margin negative test for us right now to something which would be generating positive gross profit for us.
Yeah, I guess on that point, I think, Mike, you kind of said the balanced approach this year. I know we've chatted a little bit about it. You know, you guys seem to kind of want to hold back a little bit because these are being run at a loss, obviously. How do you balance the view of, you know, hey, as we saw yesterday, there's volumes to be had here, you know, we need to go get kind of a land grab, versus we can't burn all this money? Where's the balance there, and where are you on Reveal in terms of, you know, obviously, again, holding back a little bit in terms of letting the full volumes flow. But, you know, how do you think about just that potential market share?
Yeah, no, I mean, it's a tough balancing act. I mean, we would love to really be pushing hard on the volume and driving that as hard as possible, but, you know, you do that, and there's an impact on our gross margin, there's an impact on the bottom line, there's an impact on the cash burn. And, you know, as a company, we're committed to reducing our cash burn every year. We're committed to getting to cash flow break even by 2028, and so we have to take that balanced approach. You know, we're investing heavily on screening. So, you know, it's not easy. We spend a lot of time thinking about this.
We spend a lot of time, you know, developing our budgets, developing our plans, making sure that everything that we're doing is going in the right direction. But, yeah, I think, you know, we, we've set, we've set expectations, again, how we're gonna manage the business over the next few years, and so I think at the moment, we, we stick to that. We stay very, disciplined on MRD, and, yeah, the real focus for the business is, publications, data, and reimbursement.
Yeah. Yeah, and I guess on CRC and breast, how do you think about the reimbursement path? Breast, I think, is maybe tied. Is it the COSMOS study that maybe is kind of needed there? Maybe just talk about just the timelines and how that reimbursement could ramp for the MRD piece.
I think, you know, what we've assumed for this year is that we'll publish the data, CRC surveillance in breast.
Mm-hmm.
We'll submit to MolDX. Our guide doesn't include any incremental reimbursement this year from MolDX to Medicare for either CRC surveillance or breast, and so that's probably a 2025 story for us. If it comes this year, then that's great. That, that'll be an upside for us, and that's, you know, one of our potential upsides, but yeah, I think it's more likely to be 25. And again, then, once we get to a certain level of ASP and reimbursement, we can really start to push the volumes.
Okay, gotcha. And again, I think that's another one that's been, I think, upgraded already, the smart liquid biopsy. You know, I know there was some... At the analyst day, they showed a little bit of kind of past data-
Mm-hmm.
Or right before the analyst, I should say. And then, you know, I guess all the go forward is kind of the better platform to smart liquid biopsy. Is that the right way to think about the MRD piece?
Mm. Yes.
Okay. And then, again, I guess, how do you guys think about that market in terms of, of tissue informed, tissue agnostic? Obviously, a little bit of a debate out there. You guys obviously have your opinion. Would love to just talk through it and kind of why you guys feel like your offering is, is the best in the market.
... So I think, like, when you look at the MRD market, frankly, there are two categories. There are some patients that tissue-informed MRD testing is an option. There is a piece of market that tissue-informed MRD testing is not an option, but still the doctors want to get to the MRD information. That's the place that, at minimum, for blood only, that segment of the market, like, we don't see any competition right now. We are the only commercial test clinically validated, that it's blood only with no competition. So but when it comes into competition between blood only and tissue-informed, based on what we are seeing, especially like on CRC, that we have a lot of data, blood only can have a very good performance on par with tissue-informed assays.
So, so I think that this kind of perception that if you don't have tissue information, if it's not tumor-informed, for sure, you would need to sacrifice sensitivity and specificity. Over time, it's going to become clear that at least for a few cancer types, it's not going to be the case. Blood can have similar kind of performance. So then, even for the people that you have tissue as an option, blood can be very competitive when you have faster turnaround time, when you have all the logistical advantage of a simple blood test versus the hassle of figuring out the tissue. But some of these, it's going to take some time for the cards to get played.
Yeah. Okay. And then, Mike, you touched a little bit on international earlier. Obviously, Japan is one you guys have talked about for the past probably a year or so. It's a pretty big opportunity. Just talk through where we are on some of the international markets and where those can go.
I mean, they're still all at an early stage, and again, you know, the two near-term opportunities that we have are Japan, on the clinical side, at least on Japan and U.K. You know, Japan, again, we got national reimbursement coverage in the second half of last year. We launched then, and so we've seen good traction. So, you know, we're making steady progress there. The U.K. is, you know, very interesting for us. We've had this partnership with The Royal Marsden. The NHS is very interested in using CGP, and they, you know, they're looking at piloting a program where almost they're using Guardant360 as a first line to manage their lung cancer patients.
You know, in the U.K., they have a huge issue with waiting lists, and so this is a way that NHS can reduce their waiting list. So, you know, together with Royal Marsden, we're part of this pilot program. We have a profit-sharing arrangement with Royal Marsden, so we're not having to invest in sales infrastructure there, in building out the lab infrastructure. We're basically, you know, providing our technology, and so, you know, it's a very good partnership that we have with them. So those are the two near-term opportunities we have. And then on the biopharma side, you know, we partnered with Adicon, one of the large labs in China, and that opens up the China market for us in biopharma.
But also it can strengthen our sort of global presence, and there's a lot of the global biopharma partners who, in order to do those studies, need presence in China as well. So that's helping drive not only business in China, but globally as well. So, you know, we're excited about each of those opportunities.
Yeah. Okay. And then maybe just on the expense side, obviously, we talked a little bit about it with MRD. You guys need to balance that, this world that we're in, in terms of focused on kind of the expense burn. How do you think about, I mean, you provided some guidance in terms of the expense growth this year being pretty minimal. How do you think about, I guess, this year and then the go-forward with things like screening coming in and out in terms of maybe some of the trials and then the commercial build? You know, obviously, a lot of moving pieces here over the next few years. Maybe just talk through the expense side.
Yeah. You know, yeah, this year in 2024, our OpEx will increase, we've said about, you know, 1%-1.3%. So, you know, minimal, minimal increase. And we've got some puts and takes because our research and development expense, especially in 2024, is going to reduce. We had the big lift of ECLIPSE over the last few years, and now that study is finished, so we'll have a reduction in R&D expense, and really, where the increase is going to come is on the sales and marketing side. So some on the oncology side, 'cause we want to continue to grow the business, but the majority of that increase, you know, is ring-fenced really for the launch of Shield.
As we get closer to approval, then, you know, we'll start to build out that commercial force. I think as we look forward, you know, over the next few years, there's a lot of leverage that we can really build off the infrastructure that we've created over the last year. So I think we look at research and development expenses staying relatively flat over the next, you know, over the short to mid-term. G&A expenses will just, you know, grow minimally to support the business. Of course, where we're going to invest is going to be on the commercial side. We've talked a lot about Shield and screening.
Those commercial investments are going to be very much gated on commercial traction, so whether it's on volume growth or in coverage or in ASP growth, and so we're going to be very thoughtful on how we grow that, but that's how you should really look at-
Yeah
... OpEx trajectory.
Yeah, maybe on the back of that, just the cash burn. You kind of mentioned you want to keep that going down. You guys did a raise last year, but how do you think about the cash burn and cash position? I know you have that conversion still a few years away.
Yeah.
... when do you need to address that, and how do you think about the cash flow?
I think from a cash side, you know, we ended 2023 with $1.2 billion in cash. You know, again, as we laid out on Investor Day, that's more than sufficient to get us to cash flow breakeven. I think, you know, we talked about how we're going to manage the expenses, how we're going to manage the burn on screening to be maximum $200 million a year. So I think, you know, we're going to continue that discipline. I think one thing that's important and often gets missed is, you know, therapy selection now is it was cash flow breakeven at the end of 2023. It's a profitable business going forward into 2024. It's going to start to generate positive cash.
And so we wanna, we wanna drive as much, you know, bottom line, for therapy selection as possible over the next few years. With the convertible, yeah, you know, that's something that at some point will need to be addressed. I don't think we're, you know, almost four years away from maturity. It's a zero coupon. So it's not an urgent thing that we need to address, but yeah, at some point in time, we will need to address that, refinance that, and really look at that.
Okay. And you mentioned, obviously, the screening spend. I guess, AmirAli, with everything you know now, right, the data that you guys have, the competitive landscape like you said we're seeing, I mean, is your commitment level still as high as ever in terms of the screening piece? And kind of the maybe, you continue to view that as a, as a big market, critical part of the Guardant story?
As we learn more, from real-world doctor feedback, market feedback, we continue to actually see our investment thesis has been right, and we remain bullish of the potential of Shield, as long as we get FDA approval. But again, we are not just going to go with the, vision and the, you know, feeling that we have. We are gonna be data-driven based on the performance. Again, first milestone is FDA approval, and after that, are we selling this brand based on the projections that we have? And we outlaid that in our Investor Day, what do we expect to happen within the next five years? If we continue to see that kind of attraction and value contribution, we will continue.
If not, we can use our resources for better means, and within our just keeping our balance sheet instead of investing it or spending.
Okay. All right, guys, we're up on time. Thank you guys so much for coming.
Thank you.
Thank you.