Welcome to Nateria's 2021 Second Quarter Financial Results Conference Call. At this time, all participants are in a listen only mode. Following management's prepared remarks, we will hold a Q and A session. As a reminder, this conference call is being recorded today, August 5, 2021. I would now like to turn the conference over to Michael Brophy, Chief Financial Officer.
Please go ahead.
Solomon Moskovich, General Manager of Oncology will be joining for Q and A as he is dialing in from overseas. So Steve will give his prepared remarks today. Today's conference call is being broadcast live via webcast. We will be referring to a slide presentation that has posted to investor. Natera.com.
A replay of this call will also be available at investor. Natera.com. During the course of this conference call, we will make forward looking statements regarding future events and our anticipated future performance, such as our operational and financial outlook and projections, our assumptions for that outlook, And financial outlook and projections, our assumptions for that outlook, market size, partnerships, clinical studies, opportunities and strategies and expectations for various current and future products, including product capabilities, expected release dates, reimbursement coverage and related effects on our financial and operating results. We caution you that such statements reflect our best judgment based on factors currently known to us and that actual events or results could differ materially. Please refer to the documents we file from time to time with the SEC, including our most recent Form 10 ks or 10 Q and the Form 8 ks filed with today's press Those documents identify important risks and other factors that may cause our actual results to differ materially from those contained in or suggested by the forward looking statements.
Forward looking statements made during the call are being made as of today. If this call is replayed or reviewed after today, the information presented during the call may not contain current or Accurate information. Natera disclaims any obligation to update or revise any forward looking statements. We will provide guidance on today's call, but not provide any further guidance or updates on our performance during the quarter unless we do so in a public forum. We will quote a number of numerical growth And now, I'd like to turn the call over to Steve.
Steve?
Thanks, Mike. Good afternoon, everyone, and thank you for joining us. Let's get into the recent highlights. As we covered in our preannounce, we had another phenomenal growth quarter. Q2 was the fastest year on year growth for both volumes and revenues We've had as a public company, and that's on a volume base that is now more than 4 times larger than when we went public.
I'm pleased to announce that we've exceeded the top end of our preannouncement ranges in units processed, total revenue and product revenue. We processed 376,000 tests in Q2, which was approximately 61% growth over the same period last year. Total revenues and product revenues were both up 64% and approximately 71%, respectively, over the same period last year. That acceleration is being driven by continued strong growth in the women's health business and big contributions from oncology and transplant. Those businesses are now large enough to contribute meaningfully and really shift our growth rates Given all this momentum, we are excited to be raising the revenue guide for a second time this year.
We started at $500,000,000 to $525,000,000 then upped that range to $550,000,000 to $575,000,000 in May. We are now raising our guidance once again to $600,000,000 to $620,000,000 in revenues for this year, up Almost $100,000,000 versus where we started in March. As we are having success with our new product launches, we are also needing to We have planned to make over the next 2 years, which we are very happy to do. Mike will cover the full guide later in the call. We were also very excited to see the women's health business got to cash flow breakeven in the quarter.
This was one of the top goals I announced when I took over as CEO in 2019, and I'm proud that our team achieved this while simultaneously hitting record growth rates. In oncology, we've continued to generate High quality evidence. We now have 14 peer reviewed publications with many more on the way. We're also excited to The quality of evidence is progressing, shifting away from validation studies and focusing on outcomes data like overall survival, We recently had 4 newly published or presented prospective trials where outcomes data is available, including Three trials that measured overall survival and one that showed Signatera is predictive of treatment response. We believe these prospective trials with outcomes data is a significant step towards full adoption of MRD testing by physicians and professional societies.
These studies have taken years to reach this stage, and we think this clearly differentiates Signatera in the market and lays the groundwork for broad reimbursement and adoption. We were also very pleased to announce Another high quality study yesterday that we think has the potential to unlock a new and large indication in breast cancer. The first patient has now been screened in Cancer patients that are being monitored with Signatera after adjuvant treatment. Signatera received a breakthrough device designation From the FDA for this study, and I'll go over the details of this trial later in the presentation. We've also made several We also launched with Foundation Medicine in the pharma sector and with BGI in China.
Each of these partners enables us to impact In a way that we would not have been able to reach on our own. Foundation Medicine currently has a substantial number of pharma partnerships and we believe is the market leader in tissue clinical volumes every year. BGI is a leading diagnostics player in China and has a formidable commercial channel and reimbursement expertise in that country. Both of these commercial launches are in the early stages We'll take some time to get going, but we think each can contribute to Natera's growth in the coming years. We also had a major win on the reimbursement front when we were awarded ADLT status for Signatera, which moves our recurrence monitoring Medicare reimbursements From $7.95 per test to $3,500 per test.
And finally, as most of you know, We've completed a follow on equity offering that brought in roughly a net $551,000,000 We launched with a 3 $50,000,000 offering, and we're able to substantially upsize the raise in the process due to the strong response we received from investors. As we will describe, we think we have a lot of high return projects to fund, and we look forward to putting the capital to work. I'll spend more time on all of these developments later in the call. Okay. Let's drill into the unit growth on the next slide.
I think this longer term historical view is great because it gives a sense of what our experience with Q2 has been in the past. Q2 has historically been slightly down sequentially versus Q1 driven by the seasonality in the women's health business where Q1 is typically very strong and Q2 is a lot softer for our existing accounts. This year, as you can see in the Q2 bar on the far right, Something different is happening. First, the growth in our women's health business has accelerated to a level that has now completely overcome the negative impact seasonality we traditionally see in Q2. We are benefiting from our smart trial data that was read out in January, which set a new bar in quality and size And we're benefiting from the joint ACOG and SMF in practice bulletin recommending We think we're clearly in the early stages of expanding from roughly 1,500,000 NIPTs in the United States to what could be more than 4,000,000 NIPTs over time.
2nd, the growth rates are compounded by the fact that our product launches in Signature volume is growing nicely as we add new accounts every month and initiate more new patients for CRC and IO monitoring. We look forward to highlighting a few case studies later in the call. On the next slide, you can see that the volume growth is clearly Translating to revenue growth as well, particularly in product revenues, we saw a nice increase in the blended ASPs in the business over Q1, Sequential improvement was really driven by the volume mix since the transplant and oncology products have higher prices. I think that's a good sign for the rest of the year. As Mike will describe later on the call, we still think there's room for NIPT ASPs to improve in the second half based on the broader reimbursement trends we're seeing, particularly as we make steady progress with state Medicaid plans.
Some of you will recall when I was first CEO, in January of 2019, I said a top goal for the company was to get the women's health business to cash flow breakeven. Since then, we've been very disciplined in our investments in Business, we've grown the ASPs and we've reduced the COGS while continuing to rapidly grow our volumes. So Despite all the upside we still have ahead of us in women's health, we estimate that now we are sustainably cash flow breakeven in that part of the I think that's an important case study for the overall company. We have now shown that once we make the necessary investments to establish the product and commercial channel, We can deliver continued growth while optimizing COGS and being efficient with R and D and the sales team. As the volume grows in the new businesses, we continue to benefit From the cost synergies by tapping into the scale and expertise across our broader company.
In the future, we can also apply several of the same COGS and operational savings strategies to the new businesses as well. Okay. So now let me move to Organ Health. We are tracking above our internal expectations for Prospera, and we believe the transplant market is still in the early stages of overall adoption with a lot of room for future growth. In addition to growing our volumes, we're continuing to generate new evidence.
Last week, a new study from UCLA was published in transplantation reports. In the study, the investigators ran both PROSPERA and a competitive 15 patients, 6 of whom ultimately experienced a rejection. Using the validated 1% cutoff, The PROSPERA test correctly identified 5 out of 6 rejections versus 4 out of 6 for the competitor. This data is In addition to the recent head to head study, we were also pleased to see Prospera perform extremely well in a cohort Patients that received a simultaneous pancreas and kidney transplant. They are often referred to as SPK patients.
It's important to perform well in this cohort because multi organ kidney transplants make up 8% of all kidney transplants, And these patients experienced a 15% rate of projection in the 1st year post transplant. On the right side of the slide is the data that was presented at the ATC TC Conference in June. In a cohort of 39 simultaneous pancreas and kidney transplant recipients plus solo pancreas transplant recipients, Prospera performed very well across all testing metrics, delivering solid performance across the board. Testing SPK patients allows us to help a new sector of the population that's important to our transplant physicians. In addition, this study is evidence that Prospera could perform well in organ types beyond kidney transplant patients.
For example, in this study, We performed well on solo pancreas transplant patients in addition to the SPK patients. As we talked about in May, we think the pathway to reimbursement in a broader range of organ transplants was substantially opened up by the CMS local coverage This is very important for us because it lays out an efficient path to gain reimbursement in organs beyond kidney. As we showed above, we're now seeing early evidence that our test works well in other organs such as pancreas transplant This LCD is expected to be active later this year, and we're keeping our eye on what's happening here. All right. Let's transition to oncology.
We've now published on Signatera in 14 peer reviewed publications. The validation data supports initial adoption and reimbursement as we've now demonstrated the analytical and clinical performance of the test across a broad range of cancer types. I mentioned the shift to prospective studies with outcomes data at the top of the call. This includes some very large prospective real world interventional studies Well, like the CIRCULATE trial. The studies are critical differentiators because they are larger, designed to change practice guidelines and they take years to mature.
It's important to see the test performance hold up in the prospective real world setting where the focus shifts to verifiable patient outcomes rather than analytical We started these more significant trials years ago, and we're now starting to see that work come to fruition as they read out. First, we were recently excited to present updated data at the ESMO GI Conference from the prospective real world interventional There are now more than 2,000 patients enrolled in the study with 6 months of follow-up available for the first 800 patients. We've maintained a high pre surgical detection and longitudinal sensitivity and specificity to relapse from our validation studies in this Real world setting and we finally got a substantive look at the initial outcomes data based on MRD status. We are ecstatic to see that more than 99% of patients who are MRD negative remain disease free at the 6 month median time point, Regardless of whether they receive adjuvant chemotherapy or not, this is a huge step forward, and I'll explain why on the next slide. There's a key clinical utility question that needs to be answered in Stage 3 colorectal patients.
Can we avoid giving chemotherapy for MRD negative patients. Today, in Stage III colorectal cancer, nearly 100% of patients get adjuvant chemotherapy, but about 50% of patients don't need it because they're secured by surgery alone. One of the biggest objections we get from doctors The CIRCULATE trial was designed to test this hypothesis that MRD negative patients could safely be de escalated from chemotherapy after surgery. On the left, you'll see a diagram of the patients following the CIRCULATE trial. In the bottom arm, each MRD negative patient is randomized We believe the study will ultimately show that there's no benefit to receiving adjuvant chemotherapy For patients who are MRD negative, the interim disease free survival data strongly suggests that we are on track to validating that hypothesis, This is a type of trial that can change guidelines and unlock one of the big clinical use cases that physicians are Q4, an indication where doctors simply won't use the test without this level of high quality outcomes data.
Since this trial was initiated 3 years ago, we believe this data will further differentiate us from further entrants in the market. We anticipate the results of the MRD negative stratification will be presented for the first time at ASCO G and I in January of 2022. If that reads out as we anticipated, that will be a defining moment for Signatera in colorectal cancer, and we look forward to seeing the data. To the new de escalation indication described above, we also recently published a prospective trial in Stage IV colorectal cancer This showed excellent performance, including overall survival results, unlocking another layer of colorectal utility beyond Stage 2 and 3. This paper published in the Journal of Clinical Oncology Precision Oncology was an analysis from the prospective PREDATOR clinical trial Following 112 patients with Stage 4 disease who underwent surgery with curative intent.
At the first time point, 30 days post surgery from a Single time point alone, we had sensitivity to relapse of 72%. This increased to 91% when we were able to A second follow-up blood draw on those patients who did not receive adjuvant chemo. In addition, 96% of patients who were MRD negative at Single time point after surgery was still alive at the end of clinical follow-up, which lasted up to 54 months. That compares 52% overall survival for patients that were Signatera positive. The overall survival rate increased to 100% when including patients who remained MRD negative in the longitudinal setting.
This paper addresses an important unmet Since guidelines are currently vague on which Stage IV colorectal patients should receive adjuvant chemotherapy after surgery with curative intent, It's currently recommended to monitor these patients closely for early signs of recurrence. On the basis of this publication, we have already submitted to Medicare to expand coverage under the current LCD to include Stage IV liver metastatic patients, which we expect may come in late 2021 or early 2022. As a reminder, the opportunity here is sizable as we estimate there are about 10,000 new diagnosis per year in Stage IV oligometastatic colorectal cancer with a testing frequency similar to CEA leading to a TAM of approximately 100,000 tests per year, which is sizable from historical standards. We're really proud of the studies we generated, and we believe the shift to outcomes data, including Respective overall survival data where we track patient outcomes for nearly 5 years and confirming one's validation data in a real world interventional setting It's important to further penetrate the clinical market and get reimbursed at scale. We were also proud to see another prospective publication with overall survival data this quarter in nature.
With the excellent results from the Phase III INVIGR-ten muscle invasive bladder cancer trial that we did with Genentech. This trial was a major effort conducted over 7 years to evaluate whether Genentech's immunotherapy drug, atezolizumab, Could improve outcomes in the adjuvant muscle invasive bladder cancer patients. Before reading out the data, Genentech prespecified an endpoint to evaluate patient response Patients who were Signatera positive after surgery in addition to the all comers format originally designed. When the trial failed to meet its primary endpoint in all comers, We reported a significant treatment benefit in Signatera MRD positive patients that received atezolizumab And no treatment benefit in the MRD negative patients. This study showed that Signatera is predictive In addition to our predictive claim, we reported prospective data showing MRD negative patients having much better overall Based on the strength of these results, Genentech has already started enrolling patients In a sequel Phase 3 trial in VIGR-eleven that were randomized to atezolizumab versus placebo among only those patients who test Signatera Positive after surgery.
Demand is now growing quickly across pharma and academic consortia to incorporate Signatera as a companion diagnostic in their pivotal Randomized trials. This week, we announced our 2nd major Phase III drug trial, the ZESS trial. This is a randomized multicenter placebo controlled study sponsored by GSK to evaluate their PARP inhibitor, niraparib, In 800 patients with early stage either triple negative breast cancer or HR positive HER2 negative BRCA mutated breast Patients who test positive after standard of care definitive treatment will be randomized to receive niraparib versus placebo. If this trial is successful, it could create a potentially life saving new treatment option for patients who test MRD positive in this setting. Positive study results would provide support for doctors to prescribe this treatment in their office broadly, which would be incredibly powerful for overall clinical adoption of Signatera.
Some indications like breast cancer are best approached through these types pharma partnerships because the clinical utility in breast cancer recurrence monitoring depends on new treatments being administered at the time of molecular recurrence, And that's not something a laboratory can generally take on by itself. So we're glad to be winning these types of big treatment on molecular recurrence trials, which will unlock future clinical indications for Signatera. This project was made possible by the strong validation data we previously published in breast cancer, including both the paper in Clinical Cancer Research and the I SPY-two data published in Annals of Oncology. Okay. I'm staying on Medicare for another minute.
As we mentioned at the top of the call, we had a major breakthrough this summer when Signatera was awarded Our pricing for Signatera had been set at $7.95 per time point. Now with the ADLT status, the reimbursement rate Given the nature of the longitudinal monitoring, over time, a higher and higher percentage of blood draws will fall into this category, which bodes well for the overall gross margin in the long term. ADLT status is designed to reward innovation And the relevant statute requires several criteria to be met. A test must be unique in the marketplace, satisfying a clinical need that no other commercially available test can address and also must employ a methodology that's based on a unique empirically driven algorithm. Signatera met these stringent criteria, and we believe it will be difficult for any other future MRD competitor to achieve this status, Adding to our 1st mover advantage, this also gives us an important lever when contracting with commercial plans in the future and it helps our pharma business since Natera is extending It's commercial leadership in MRD, which makes us more attractive as a companion diagnostic partner.
Finally, Looking forward, we are eagerly awaiting the finalization of our draft LCD for immunotherapy monitoring, which we expect to come through sometime earlier this year. We've been pleased with the initial adoption in this setting, further validating our belief that Signatera can help inform difficult treatment decisions The final slide highlights some of the near and longer term indications we are targeting with Signatera. In the past, we focused Excellent data and the clinical utility and use cases are very clear, and we have line of sight to reimbursement with CMS and commercial launches in the near term. Those near term indications stack up to about 4,000,000 tests per year, which is incredible from historical standards. This is roughly 10 times larger than the 400,000 tests per year in the traditional therapy selection market, for example.
However, despite this TAM being incredibly large from historical standards, this is just the beginning With several pivotal randomized trials now underway in colorectal, bladder, breast and others, sponsored by pharma and leading academic consortia With a strong pipeline of additional trials that may launch in the next 12 to 18 months, it's clear that some very large opportunities are beginning to stack up in both the U. S. And globally, including in Japan. We're simply looking at what we signed so far or have in We have an excellent runway to success in the near term. I could easily make the case that Signatera is really Only scratching the surface and just at the beginning, and we could really hit full stride in the middle of this decade and beyond as these very large pivotal trials readout.
So there's a lot of upside in the future. Finally, not on the slide, but important to our mission, we were proud this quarter as 2 patient case studies were reported out in the national media 1 colorectal case was reported on NPR's Hear and Now broadcast And one breast cancer case reported on ABC's Good Morning America. We want to thank those patients, Bonnie and Morel, and their physicians for sharing how Okay. Now let me hand it over to Mike to discuss the financials. Mike?
Thanks, Steve. The next slide here is just a summary of the financial results for the quarter. Steve covered a lot of the trends on volumes and revenues. I'll just note again the acceleration we saw on the top line. And are I'll just note again the acceleration we saw on the top line.
Our year on year volume growth rate was 48% in Q1 and now 61% in Q2. Product revenue year on year growth was 36% in Q1 and now 71% in Q2. ASP Fees stepped up in the quarter. And as Steve mentioned, more of that increase was really driven by volume mix as the new higher priced products start to have more of an impact On our blended average selling price, women's health ASPs were also slightly higher in the quarter. And as Steve mentioned, I think we still have room to run over next several quarters there.
We got a substantial boost from improved reimbursement in our commercial insurance volumes. If you compare where we are now on ASPs versus this time last year in the women's health business. And we've had some positive contracting decisions that we think can The reimbursement, for example, in our managed Medicaid volumes over the next few quarters in women's health. I think it's important to note that we think there is significant upside The current oncology ASPs, which can improve over time just as the product launch matures. While the majority of our volume range of cancer types.
We are happy to see that because we think the data supports broad use and we think we have clear line of sight to reimbursement in additional cancer types via As we've discussed in the past, we anticipate getting coverage for immunotherapy response monitoring This fall, when that umbrella local coverage decision goes live, then we think coverage in additional cancer types can come from a more streamlined process of just submitting the data. But for now, we're taking a lot of zeros at the moment as the launch progresses. We also haven't yet gotten the benefit from the ADLT designation, which at least for our Medicare reimbursed volumes should be a lift in the second The COGS for the Women's Health business are looking very good. For example, NIPT now is in the $160 range per unit and we see a path to NIPT COGS below 125 In oncology, we are just at the start of the road map to drive COGS improvements. The first step is just to build out more capacity.
We've significantly brought forward investments to build out lab space to accommodate both the clinical demand and also Specialized capacity designed to meet the needs of the larger Phase III trials we are now running for pharma. None of this scale up work carries technical risk and the volume trajectory we are on makes the return on capital math very clear. It does, however, Require significant near term CapEx and hiring in both the R and D and lab operations areas of the business. So the gross margins in the quarter Really reflects good traction in women's health and we were way down just a few points by the rapid growth phase we are in for Signatera. As we've discussed in the past, Signatera can, of course, be a higher margin product than NIPT, so I view this very much as a temporary circumstance.
The R and D and SG and A lines also reflect a significant upfront investment we are making in oncology. In research and development, we are adding staff to execute on scaling the lab along with the fulsome slate of clinical trial work we are doing with Academic and pharma partners. We've talked a lot about the pharma partners today, but our recent publications have also generated a large volume of to support studies with KOLs in the field. This is the type of work that generates obvious long term benefits even if it does not return And we are staffing up to make sure we meet that demand. Crucially, we are also finding more products and services That can be wrapped around Signatera, much like carrier screening is in the women's health business and what we are seeing so far from the Altaira tissue CGP.
While we occasionally evaluate small acquisition targets, our history has been to avoid lots of M and A and invest more heavily in our own R and That obviously leads to a bigger R and D line, but we have found that approach to be much more effective and capital efficient One other line to note on this slide is the balance sheet. Steve referenced the equity offering which we raised roughly $550,000,000 in an upsized deal. We raised that capital for one key reason. We have a lead in this very large recurrence And we are going to make all the necessary investments in the near term to set us up for long term success. Okay.
So I think that gives you some background for the guide on the next page. We are significantly stepping up both the revenues and the investments for the balance As Steve mentioned, we are now guiding revenues about $100,000,000 higher than when we started just a few months ago In March, the main driver here is the volume growth that has continually exceeded our expectations even through the summer. We've remained Cautious on the ASPs in the guide. We don't assume a big step up in any of our products aside from some modest improvement in Signatera driven by the ADLT and the Umbrella Local coverage decision. So for the revenues, we are assuming continued volume growth Across the business, in the new products, we are optimistic that our recent launch trajectory can continue in the near term.
In women's health, we are seeing the One note on the revenue map for the guide. It's important to recall that we took a one time revenue recognition, A positive bump of $28,600,000 in Q1 this year related to QIAGEN. So if you're making the comparison And between first half and second half revenues on the guide, I think it's worth stripping that out. The result is you'll see the guide implies significant revenue growth in the second half of this year. On the gross margin On the gross margin guide, we bumped that up on our last call in May and And indications that are not reimbursed yet.
To balance that out, there are some tailwinds associated with other COGS projects in the second And both the ADLT designation and expected reimbursement for IO monitoring will help margins as well in the second
The SG and A, R and
D and resulting cash burn line reflect the additional work we have planned to get done this year, which is almost exclusively focused on the oncology drivers I More lab capacity, accelerated clinical trials and large indications, accelerating projects designed to reduce Steve talked about how we've been able to get scale in women's health, and I think that's an important case study to visualize how we can get leverage on the oncology As we expand into pan cancer, we can leverage the same operating expenses we've built out for the colorectal cancer So with indication expansion, increasing volumes, reduced COGS and broader reimbursement, we are following much the same Playbook to get the cash flow breakeven that we followed in women's health, but on a much larger scale. So it's an exciting time for Natera, and we are very excited to have been able to share these results with you. Operator?
Thank Our first question comes from the line of TJ Savat with Morgan Stanley.
Hey, guys. Good evening and congrats on a nice quarter here again. Just one question here on Signatera, Steve. On the ADLT code upside, you're expecting a nice bump here on your Medicare volumes. But at some point, I believe next year, at the end of Q1, that trend will normalize under the PAMA process, Yet you've got offsets to that.
So can you just walk us through the longer term ASP trend dynamics here? And also how getting that ADLT Code can help with the competitive moat with an MRD for you.
Yes, sure. That would be great. So, the ADLT It's a very significant advantage, and it's only available to the 1st mover, who has an innovative test on the market. So we're very glad that we were accepted into the program and we were able to increase that recurrence monitoring price From $7.95 now up to $3,500 because over time, as The flywheel effect of getting patients into the recurrent ordering program occurs, you're going to have more and more and more of the patients at that recurrence So it's critical that you maintain a high ASP in that time point. Now the way the program works There's a time period, I believe it's roughly 9 months where they look at your commercial claims.
During that time period, you get paid the list price of $3,500 and then after that, they look at your commercial claims and they'll reset your price Based on the median weighted reimbursement from commercial parties. Now the good news is We've been very strict about how we negotiate with And we've successfully negotiated rates that are at or above this $3,500 price point With private payers, so we don't expect to see any price reductions on an ongoing basis through the PAMA process. Of course, it has to pay out play out over time. But at this stage, all the rates we've negotiated are at $3,500 Or higher, and we expect to maintain the price point or have it increase.
Thank you. Our next question comes from the line of Tycho Peterson with JPMorgan. Your line is open.
Hey, thanks. First question on the back of the financing and Can you just talk a little bit more about the MRD roadmap for multi cancer? You talked about 4,000,000 tests in the near term, 9,000,000 longer But maybe just talk a little bit about use of proceeds and how quickly you think you can scale up some of these efforts? Yes. So there's a lot of work, I think, to roll out each of the different indications.
The good news is that the most important thing to being successful in the Signatera market is generating the right data. And we started that process of generating the data a long time ago, 5 years ago, roughly. You look at some of these trials, They were ongoing for that period of time. We had teams of people out hunting for clinical trials that we could get into 5 years ago. So now these studies are reading out and they're being published.
That's the most important thing in order to unlock usage In a particular tumor type, it is to unlock reimbursement in a particular tumor type. So when we look at where we are in colorectal today, Stage 2 and 3, we're seeing a lot of volume come in. We're seeing rapid increase in ordering On the clinical side, which is great and in line with our expectations, we've now generated this data in oligometastatic Stage 4 colorectal deepening our penetration in the colorectal space and that data looked excellent. I mean really good data with overall survival as well, Which is really the next step down in kind of raising the bar for what type of data is Product, which is going very well. We're seeing increases consistently in the usage there.
We've also Sure. On muscle invasive bladder, lung, neoadjuvant breast, ovarian, multiple myeloma. Now we just had a Publication in esophageal cancer. So all those areas where we've generated data and we have published data, I think over time, we'll be rolling out those indications. We're actually seeing usage today in a lot of those indications, even though our sales team is not Promoting.
We're just getting inbound requests where doctors read the paper and then they want the test or patients hear about it and they want the test. So we are seeing usage, although the vast majority of our business today is colorectal and immunotherapy. So that's sort of one sector. The near term Kind of 4,000,000 tests per year opportunity. Then there's the bigger sector And we think that's like breast treatment on molecular recurrence, for example, the lung treatment on molecular recurrence.
And these big Phase III clinical trials take time to read out. But when they do read out, There are going to be massive market moving guideline changing trials. So it's kind of a great setup where we have this Significant amount of growth and work that we can do in the near term. And then when we get to the kind of Mid to upper 2020s, we have this second wave of extreme growth that's unlocked by the investments that we're making Today in the trials. So that's sort of how we see it playing out.
And the other thing that I think is good about these big trials, like for example, the breast one that we just Once the competitive landscape is established here and there's maybe a handful of folks that are participating in these trials, It's going to be really hard for others to come behind. I mean, these are 7 year, 5 to 7 year These are the types of things that really truly build a competitive mode that make Very difficult for others to come in behind. So we feel like we're in a good position in the short term And to tap into that very significant upside that's going to come in the future.
Thank you. Our next question comes from the line of Catherine Schulte with Baird. Your line is open.
Hey, guys. Thanks for the question. I guess, first, just on the guide, you mentioned being cautious on ASP outlook and not baking in a significant increase in NIPT. I guess, in theory, shouldn't we see this bump up as some of the plans that updated their policies last year move to accrual accounting? And when do you expect that, that might happen in a more
Yes, we yes, yes, I was going to say, Mike, why don't you take that?
Yes. No, hey, thanks, Catherine, for the question. Yes, so we have seen some of that benefit. If you kind of if I look back to NIP, ASPs prior to any of those cover decisions last year versus now. We have gotten a good step up on the NICT contracts in terms of the fraction of time we've gotten I think that's true primarily in our commercial business, although it's starting to look more and more true through the Medicaid volumes as well.
I do think that there is still room to go on the NIPP front in particular, just as I look at the fraction of claims That are still unpaid for some reason like our prior authorization policy that we think can get removed or Myriad other rationales that payers may have state Medicaid plans that aren't yet adhering to the new ACOG practice guideline, For example, so I think there's room for that, the ASP to improve. I think there will be some benefit just by depth of the accrual, as you Just as you get more history with more and more payers, that there is a kind of a natural momentum to that. So there is some modest ASP improvement in the guide there, a lot of that though in terms of kind of impact to ASPs On a blended company basis, it just comes from the fact that, hey, we didn't have the ADLP really in a meaningful way in Q2 and we'll have it in Q3 And beyond, and to the extent we've got Medicare volume in Cignatera colorectal cancer stage 2 and 3, and then We'll get a bump from that. And the other piece is that the on the Secretariat ASP is that there's kind of a natural progression where now that we have the KVLP, The ASPs, the blended ASPs that product can improve as you get more and more patients into the kind of the longer tail of Recurrence monitoring tests versus kind of the upfront tests as well.
So that's a trend that can start to benefit us in the All this requires a certain amount of forecasting. And as most of you know, we've called the company for a while. We're just trying to on When it relates to the guide and particularly forecasting ASP. So it's almost more of a philosophical point than anything else.
Our next question comes from the line of Mark Massaro with BTIG. Your line is open.
Hey, guys. Thanks for the questions and congrats on the quarter, the raise and all the data that you've been publishing. I guess, A couple of weeks ago, when you guys did the deal, the financing, you indicated that you expected to make some significant announcements In the organ transplant business and potentially beyond, which I believe might be screening. Today, you talked about Simultaneous pancreatic kidney transplant. So I guess I'm just curious if you could elaborate on any potential plans for expansion Beyond kidney testing, would that obviously include pancreatic and some of the others?
And then any thoughts you have on Early cancer detection, just the development work you've been doing. And I think previously, you talked about plans to do colorectal cancer
Yes. Thanks, Mark. Yes. So on the Oregon Health side, things are going really well. I think we're beating our plan, as we said, ahead of our expectations.
We're starting to see some good data come out. We showed this head to head study, which I think is now the second head to head study that's been performed. We've outperformed on the Projection using the validated 1% cutoff. We showed now, I think, that our platform test Works well in other organs. So the simultaneous pancreas kidney, pancreas alone transplants, Which is good.
I think that essentially shows that we're going to be able to transport into other organs. And now that This LCD has been put in place, which is essentially an umbrella LCD that will allow us to go get reimbursed If we choose to go into other areas. So I think the groundwork is all there. The sort of proof of concept is there. And I think we'll be in a good position to sort of make those moves in the future if that's an area that we decide to go into.
I think when we look sort of across the business, we have to kind of decide where we want to make the investments and so forth. But certainly, the kind of framework It's in place there. On the early cancer detection side, we've basically said that We've developed a platform. We have some data that looks good. We have access to a significant number of samples and we're going to package all that up and to everybody in the future when we're ready to.
We just haven't done that yet. And so I think that announcements We'll be coming, where we're going to describe what we're doing, what we have so far and what our plans are, But we're just not rolling that out today, but we feel very good about the opportunity we have.
Our next question comes from the line of Dan Leonard with Wells Fargo. Your line is open.
First, thank you. This is Lou on for Ben. Just some quick questions on the organ and then also oncology I think in the prepared remarks, you're talking about there is like you started to see contribution from those two business. Can you quantify a little bit in terms of the volume or the size of revenue? And then also on the women's Paul, I think you also mentioned the share gain.
Can you also like talk a little bit more about the share gain opportunity, especially after one of your competitor has with the market. Thank you.
Yes, sure. So why don't I talk about the share gain and then maybe Mike you can talk about like how we're managing breaking stuff out. So on the women's health side, we have been just crushing it. I mean, we're accelerating. You continue to grow over the last couple of years and sort of what we're doing now.
I mean, it's a whole different level of growth. So We're in a fantastic position. We've got a great technology. We've made significant improvements to the technology that have been launched this year With Pano AI, that's playing out very, very well in the field. Great customer feedback.
We've now got the largest prospective trial that's ever been done in the field of NIPT where the results in a real world setting held up, and actually were better than our validation data. So that's super strong. I think some of the big academic centers and maternal fetal medicine practices that Hadn't been using us before considering a switch are now looking at that data and they're excited about it because this type this quality of Data just hasn't been produced before. So yes, we are having competitive wins, but we're also seeing And so those two things simultaneously happening are causing an acceleration in the women's health growth. The market Today, we believe it's about 30%, maybe 35% overall penetrated.
So there's a long way to go Just simply riding the wave of penetration in the market. And even if we weren't seeing competitive wins, We think in the next 3 years that NIPT market is going to get to Growth excuse me, 90% penetration. So that's a very significant growth. But on the competitive side, We're outpacing everyone else from a growth standpoint. We're taking business from competitors.
You saw one main competitor exit the market and they were very Well, I think converting that business to Natera based on the numbers we're seeing, we believe we got more than our share Of that business. So we're feeling very good about that. I think we're in a good position. So Mike, do you want to maybe comment just on how we're breaking out organ health or oncology from a unit revenue standpoint?
Yes. So our current plan has been just to describe the business on a total company basis now. That's largely for competitive reasons as it relates to New product launches, we've had the experience in the past of giving very, very granular disclosure, which is Yes, easier for us and easier for you all, I appreciate. But we've seen it time again actually harm the opportunity as competitors are able to kind of dial Exactly, how well we're doing and then redouble their efforts. So we're not inclined to give that at the moment.
I think the other piece is that we're still relatively early in these launches. I mean, we're a little over a year, a little over 6 months in Organ And Signatera, respectively, if you're still getting a handle on exactly what does the long trajectory, what does the growth curve look like in these businesses And so, I mean, over the relative near term, I think we'll be in a position to give more color there. I think On a total company basis, though, you can kind of you start to see some of the impact. I mean, a lot of the beat, well, all of the businesses And growing ahead of our internal expectations. You don't raise guide from $100,000,000 from $500,000,000 to $525,000,000 to over $600,000,000 for total revenues without some new products really launching And so I think you can see that in the guide and also just on the product revenue growth year on year.
So clearly, it's having an impact
Thank you. At this time, I would now like to turn the call back over to management for closing remarks.
Great. Thank you very much for joining the call today. We appreciate it. Take care.
Thanks, everyone. Cheers.
Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.