We're excited to have the Veracyte team here joining us this morning. The company's got some leading franchises in Afirma and Decipher to help decide next steps during some key points in the patient oncology journey and is moving forward in a few other areas as well that we're going to dive into. Happy to have Marc Stapley, CEO, John Leite, Chief Commercial Officer, and Shayla Gorman from IR as well joining us today. I'm going to turn it over to Marc for a presentation to get us kicked off, and then we'll join him up on stage as well for some Q&A in just a few minutes.
Great. Thank you. Hi everyone. It's a real pleasure to be here with you at this year's Raymond James Conference. So as mentioned, my name is Marc Stapley. I've been with Veracyte as CEO now for 2.5 years, and I'm very proud of the accomplishments our team has made in that time and our very transformative approach to diagnostics in cancer. First, of course, I'd like to point out that we may be making forward-looking statements today that are intended to be protected by our Safe Harbor Statement, and that can be found on our website at www.veracyte.com. So on with the Veracyte story. At the center of everything we do is the patient who is dealing with cancer or who's been diagnosed with cancer or has a suspicion or a risk of cancer.
This is an emotionally devastating time, and we're dedicated to bringing clarity and confidence so that every patient can have the personalized path to optimize outcomes. We're doing this not just in the U.S., actually, and this is one of the elements that differentiates Veracyte. We're doing this all over the world. Our tests provide clinicians with information needed to help make those important decisions about whether a patient has a disease, the prognosis for the patient, whether specific interventions are required once a diagnosis has been made, and soon whether treatment has been successful. We've come an incredibly long way with a portfolio in thyroid, prostate, breast, and lung cancer from our single product focus in endocrinology more than 15 years ago.
And we've served over 450,000 patients worldwide in more than 35 countries, and our tests are currently being used in 35 clinical trials and are featured in over 500 publications. So let me talk a little bit about our approach at Veracyte. We have a very good understanding of what it takes to robustly launch successful diagnostic products, and we've assembled all the components of this unique platform which we use to launch and drive adoption of our diagnostic tests. So firstly, for every one of our tests, we have a fundamental belief in more data, genomic and clinical data. We've always run a whole transcriptome for our Afirma and Decipher tests, and we will run a whole genome for the MRD tests in the future.
Using our deep bioinformatic and AI capabilities, our scientific team develops broad insights for each of our tests, and we're also enabling customers and researchers to carry out research and develop additional insights via our GRID, which is a research capability that we offer based on the whole omic data that we generate. Our experienced clinical and medical teams drive repeated cycles of evidence development. With prospective and retrospective studies over time, we focus on evidence that allows us to answer key questions, and that drives adoption and ultimately guidelines. With our years of experience in market access and reimbursement, we work closely with MolDX and commercial payers to leverage the evidence and meet the requirements to demonstrate the clinical utility of our tests. Then once we've de-risked reimbursement, that's when we launch the test and deploy our talented commercial team with the evidence they need to drive adoption.
Our market-leading real-world utilization continues to drive more evidence and more utility, which provides additional support and confidence in our tests, and that increases adoption and ultimately, again, guideline inclusion. This ever-expanding flywheel that I'm describing here is what we call the Veracyte Diagnostics Platform, and it's the combination of all these components that is so powerful. Let's talk a little bit about why. Afirma and Decipher, which are our tests in thyroid and prostate cancer, are the leading tests in their respective markets. While we were first to market with Afirma, we were not with Decipher. Yet this robust approach has led to broad adoption and market leadership in both cases.
And then we can also leverage this same platform I've described to serve more of the cancer care continuum around a specific indication and to fuel our growth across indications to drive more clarity for more patients. So we'll talk about that as well. With Percepta Nasal Swab, we will move upstream in the care continuum to provide a non-invasive test for patients with lung nodules. The Pivotal Nightingale study that we're currently enrolling for will provide the clinical utility evidence supporting our decision to launch the test and drive reimbursement the way that I just described. And with Decipher in prostate cancer, we've gone beyond prognosis, now moving into prediction of therapy response to treatment selection and avoidance of radical prostatectomy where applicable, and soon to metastatic advanced prostate cancer.
With the addition of MRD testing to our portfolio through our acquisition of C2i Genomics, we can now expand downstream, allowing us to move into monitoring therapy response and testing for recurrence, supporting patients from diagnosis to treatment. All of this is driven by the same Veracyte Diagnostics Platform that I described. As a company, we've aligned and focused around five key strategic growth drivers that will enable us to continue to grow in the next few years as well as long term. We see a number of catalysts to continue to grow the market and gain share in both our core Afirma and Decipher tests, which are our first two growth drivers. Our third growth driver is our global IVD strategy, where we will launch three new tests in Europe over the next three years.
Our fourth growth driver is our Percepta Nasal Swab test for lung cancer to solve new cancer challenges. And then with our recent C2i acquisition, we added an important fifth growth driver, which is our MRD test to serve more of the patient care journey. So I'm going to talk about each one of these five core growth areas. Starting with thyroid cancer. Since 2011, Afirma tests have been used to help hundreds of thousands of people with thyroid nodules, enabling more than 175,000 patients, approximately 60% of those tested, to avoid an unnecessary surgery when facing an uncertain cancer diagnosis. As a result of these continued cycles of evidence generation that I talked about and growing data, we and others have meaningfully furthered the clinical evidence since that time.
More than 140 studies have been published on Afirma, including, importantly, a key meta-analysis of 13 studies that was done in 2022 that demonstrated performances even stronger than the original publication in the New England Journal of Medicine in 2012. Over the last two years, we've extended the functionality of our Afirma test, which is helping to drive greater adoption and resulted in 2023 being a record growth year with more than 54,000 tests. For example, last year we launched TERT, TERT promoter testing. We also recently launched Afirma GRID , the research tool that could be leveraged with the endocrinology community for additional insights, discoveries, and novel tests. And despite the strong performance, we expect to deliver Afirma growth for the foreseeable future into a market that we now believe can grow to at least 80% penetration. We're going to achieve this through three key growth drivers.
Number one, continued execution to drive further penetration into not only existing accounts, but also new accounts. Secondly, engaging with MolDX on their draft LCD to cover Bethesda-5 patients who we know can also benefit from the Afirma test. And then enhancing test functionality empowered by GRID and the customer experience. Moving to Decipher next. We're seeing the benefit of utilizing the Veracyte Diagnostics Platform in prostate cancer, where Decipher is now the market leader and has helped guide treatment decisions for 200,000 patients with prostate cancer. We've got more than 100 publications on clinical validity and utility, an additional 73 discovery publications leveraging Decipher GRID. The clinical evidence generated to date has led to Decipher being the only prostate gene expression test with level 1B evidence in NCCN guidelines, which is a material distinction from other tests on the market.
But we still got a lot of work to do to ensure that every patient with a prostate cancer diagnosis is able to receive a Decipher test. In 2023, we made great progress. For the full year, we provided results to more than 58,000 patients. But there's still plenty of opportunity to help drive penetration into a market that, again, we think can be 80% of approximately 300,000 patients per year. So similarly, we're focused on three key growth drivers here. Number one, deepening penetration of Decipher through market development, physician awareness, and ongoing communication of the NCCN guidelines. Two, growing the market through coverage expansion and adding the metastatic indication, where there are an estimated 30,000 patients annually who could benefit from Decipher. We expect the metastatic LCD to be finalized towards the end of this year or early next.
And then thirdly, continuing to utilize Decipher GRID and other efforts to further the flywheel of data generation and claims expansion. Now I'd like to talk about our approach to global expansion, our third strategic driver. We're executing on a multi-platform IVD approach where we believe the quality of our diagnostics and the level of evidence supporting them differentiates us. As we've seen in the U.S., this lends itself to establishing a leadership position. We've completed the transition of manufacturing of our Prosigna assay from NanoString to our Marseille, France, location, and it's already having a positive impact. We're also focused on key product and market development activities that will drive a steady cadence of IVD test kit launches over the coming years. I mentioned three.
First, we will soon submit our existing Prosigna test for approval under the IVDR framework, and that is a key launch pad, launching step for all of the future launches in oncology across our IVD portfolio. So from there, we expect Decipher Prostate to launch in mid- to late 2025. And we also plan to launch an updated Prosigna test using NGS instead of the nCounter around that same time frame. And then thirdly, we expect to launch Percepta Nasal Swab in 2026. And then once we launch these products, it's important to remember while we do get regulatory approval for all of Europe under IVDR, we have to drive adoption and reimbursement country by country. But we'll be able to leverage our existing commercial team, at which point we expect to see revenue will start to ramp.
As I mentioned, our next growth driver is to solve new cancer challenges, and we're doing exactly that with our Percepta Nasal Swab test for lung cancer. As many of you know, lung cancer is the leading cause of death among all cancers, and early detection and diagnosis can reduce mortality. In the U.S., about 15 million people annually are eligible for screening, of which only a fraction are getting screened, and 1.6 million lung nodules are found incidentally each year. And so the way Percepta Nasal Swab will be utilized is for those patients who are current or former smokers who've been identified with a lung nodule, the test will be able to use to classify their risk and hopefully avoid some patients from having to have invasive procedures while accelerating the path to treatment for other patients who are higher risk.
So the next critical step for launching our product is the Nightingale study that I mentioned earlier. We've signed our last site, close to 100 sites enrolling, and now we'll start tracking the results to determine when we're able to report out clinical utility in a year or two after the last patient is tested. And then finally, there is an LCD in lung cancer that we've commented on, and we're waiting for feedback and hoping for the bronchoscopy requirement to be removed from that LCD. If that change is accepted, then it could streamline the path for reimbursement for Nasal Swab. And then finally, moving to our focus on serving more of the patient care journey, our fifth growth driver, which is MRD. So as I mentioned, a month ago, we completed the acquisition of C2i, which is a company with novel whole-genome sequencing capability in MRD.
We're now entering the minimal residual disease market, which we believe we're uniquely suited to serve and should be serving, given that we take care of the patient all the way up to diagnosis, prognosis, prediction, and now we'll be able to serve the patient through their treatment. MRD is a large emerging market. It's roughly $20 billion estimated. We'll be able to expand our role here across the care continuum, as I mentioned. We'll focus on markets where we have a clear commercial channel and relationships like urology with a clear path to reimbursement, and we'll expand from there. We picked C2i due to their best-in-class capabilities and whole genome approach, which ties in perfectly to the Veracyte platform. Not only does that whole genome generate extensive data, but the C2i approach gives us other benefits.
The assay requires less than five mL of blood, which is lower than many competing tests. The rapid generation of patient-specific signatures available almost immediately after the whole genome assay is run, compared to bespoke panels that could take weeks to develop. And then the widest possible view of the tumor genetic landscape with the whole genome approach to deliver performance that we believe enables earlier detection versus imaging and other molecular tests. Ultimately, this leads to better outcomes, and the physician can rapidly tailor the care plan for the patient using our tests. So I'm excited about the opportunity for MRD. We're going to launch a test first in muscle-invasive bladder cancer in the first half of 2026. Again, a channel that we already support and a clear path to reimbursement. So moving to how all of this translates into our strong financial profile.
I think everybody knows we had a great 2023. Our full year revenue of $360 million was an increase of 22% versus the prior year, and we ended the year with more than $216 million of cash on hand. We're focused on doing more of the same. We'll drive profitable growth on a cash basis, leveraging the Veracyte Diagnostics platform with a focus on those five strategic growth drivers as I've shared. So given this, we're excited about our ability to continue this trajectory over 2024. We provided guidance on our earnings call for 2024 of total revenue $394-$402 million, with importantly, testing and product revenue expected to grow 13%-15%. And then regarding cash, we continue to manage that closely.
Even with our acquisition, we will absorb the R&D expense associated with MRD through ongoing portfolio prioritization so we can still deliver positive cash flow in 2024 and going forward. Consequently, we'll grow our ending cash balance to $230-$234 million during the year, including the impact of approximately $8 million of one-time acquisition-related expenses and in line with revenue growth. So to wrap up, I'm excited about our trajectory and even more by the impact we're having. Our success will continue, I believe, to hinge on three core pillars of strong execution. Number one, meaningfully expanding the markets we serve, utilizing our platform across geographies, indications, and the care continuum. Number two, embracing the best technology, adding new capabilities like MRD and AI to the world-class scientific expertise that we already have.
And then three, driving revenue growth with a discipline and a focus on profitability and continued positive cash generation. And that's what will allow Veracyte to continue to build a strong foundation for growth while achieving our vision of transforming cancer care for patients all over the world. Thank you.
Perfect. Thank you. And John, if you want to come join us up here, we've got time for a little Q&A before we move down to the breakout. That was great, Marc. I think kind of for the Q&A portion here, I want to start with really what has been your bread and butter at Veracyte from, frankly, before you even joined. But maybe first, just remind folks on Afirma where we are from a penetration perspective in the market and where you think we reasonably can get and what it sort of takes to get there.
Yeah. So as I mentioned, just again, a little bit of background, but Afirma has been on the market for over a dozen years, and 2023 was, notwithstanding the COVID impact years, the best year of growth that we've had. And so there's clearly opportunity for Afirma to continue to grow. The market, we believe, is around 60% penetrated with, as I said on the presentation, an opportunity to get to 80% and maybe even beyond. So excited about how we continue to drive that.
It's a space that feels like it should be more competitive than it is. You have really great share. Maybe just remind us that share, how you see it. Then what do you think it is that really has let you build and maintain that leadership position on a product that, like you mentioned, is 10, 12 years old?
Yeah, it is competitive. I mean, there are a couple of other tests in the market. We believe we have the majority share there. And I think really what differentiates us is going back to that diagnostics platform. We've completed all of those key steps for Afirma over and over again, and then including last year and the last two years, driving a lot of enhancements to the product, including TERT, the grid, which we launched last year, the whole physician experience. So all elements that continue to keep that product very much refreshed and bread and butter.
Maybe just on that quickly, on the TERT enhancement and others, are there things you're looking at today that I probably, frankly, don't even know about that you can continue to enhance that product from the competitive perspective and from, frankly, the perspective of driving utility and kind of benefit to the patient?
I think so. But more importantly, as I laid out in the presentation, kind of the key growth drivers. And John, maybe you want to add a little bit around some of the things that we're doing to really continue to drive growth in Afirma.
Yeah. So you mentioned GRID. TERT is an addition to the test we did last year. We're now starting to leverage GRID to get into more academic collaborations. That ultimately leads to more insight and publications, which drives more demand. We see this virtuous cycle associated with the addition of these insights.
In addition to that, tracking the LCD for Bethesda-5, as I mentioned, which is also a key indication where Afirma is being demonstrated using evidence to actually have a benefit for those patients who are suspicious.
Perfect. And maybe shifting gears a little to Decipher as well. Like you mentioned, not the first to market, but the leader now, which I think is an impressive thing in and of itself. You said in the past, you called out, I think, in the presentation, it's really that quality and breadth of data as a big driver there. I guess the question here is, how do you use that to maintain that growth and to continue to build on what you have there when it is a market, again, that is competitive, that has others trying to generate the same data, generate a data lead just like you've built so far?
Yeah, exactly right. I mean, it is competitive too. And Decipher has taken the leading share there. And I put that down to that strength of the evidence that we've got, the hundreds, as I mentioned, of publications, the research that's being done on GRID that is enabled by the fact that we have the whole transcriptome as well. And so it's actually that continued cadence of evidence development is what's led to adoption and ultimately guidelines, and guidelines are proving to be very important. You might want to give a quick update on just as recently as last week, a new change for Decipher.
Yeah. So the updated guidelines on prostate, this is NCCN guidelines on prostate, reevaluated the landscape of tests and gave the highest rating of a level 1B to Decipher, which is the highest that they assigned across the board. Very specifically to Decipher as well, they've included this new table where for each of the risk categories that are the outputs of Decipher, they've given very clear recommendations based on evidence of how physicians should manage those patients, which only lends further clinical utility to the test. And so for physicians who might have been on the fence before about how exactly they use these tests or perhaps having their own gestalt about what types of patients they would use with this test, we see an opportunity there for further penetration.
Perfect. Answering a question I was going to ask anyways, but it begs the question, when we think about sort of the evidence that you are generating and what that really drives, how much of this is that fact that we do have grid, the fact that you do have that whole transcriptome sort of approach to let you see that evidence, see that sooner than somebody who maybe has a panel that may be similar but doesn't get to see the intricacies of what's happening beyond the handful of things they may be looking at?
Yeah. And you're answering your own question, right? So ultimately, the value of running a very broad transcriptomic panel is the fact that you're able to then collaborate with physicians who are managing patients. And the samples that they send to us are the same ones that they're investigating new therapies, new interventions. Ultimately, those things end up as publications, and ultimately, those things end up as insights that get included in guidelines.
And then sorry, maybe I'm going to bounce around a little bit here, but thinking about how you're talking about those maybe growth drivers three through five, right? And I think that level 1B evidence and the box you talk about is actually a really interesting concept in terms of, I've always viewed Veracyte as you find really important key sort of bottlenecks or pain points for the clinician. How does that drive how you think about both on the organic side, hey, what else can we do to help the clinician, but also as you build new products, whether inorganic or organic, the overall strategy, right? Because I think it's a key thing that's different for you.
Yeah, I think you're absolutely right to pick up on that. I mean, we've always focused on a few things, and I describe that as part of this Veracyte Diagnostics platform. But answering the right question, questions that will help the physician to provide better treatment and better care for their patient. We're not creating and launching tests that are out there looking for a problem to solve. We know because we have strong, deep medical expertise. We have channels that are very rich and deep. We know what questions physicians are struggling with, especially in our channels, and how we can help to solve those, which is how and why we've enhanced our products over time, which is how and why we've directed our evidence development in certain areas. And of course, a lot of the evidence that is developed is not driven by us.
It's driven by others too, but it's doing a similar thing. It's answering real questions and challenges that physicians are having. And so that's been a core fundamental underpinning of that platform. Now, if you think about beyond that, new indications, we ask ourselves, how can we differentiate ourselves by applying this platform in other indications beyond the ones that we currently serve as well? And most of that is an organic conversation, as you can imagine. Inorganically, you've seen us do things like the acquisition of C2i, which really helps us gain a couple of years, at least, of acceleration of a strategy that we otherwise would have had to have developed internally. And that's important.
I want to get to C2i in a moment, but maybe first, lung, just thinking about that context and how you see Percepta Nasal Swab fitting into sort of the care paradigm there where we have pretty atrocious compliance to screening. And then from there, obviously, some pain points too on what's a nodule that matters versus one that doesn't. So just kind of what's the underpinning thought there in terms of how you approach that?
Yeah. I mean, that's the challenge that we saw when we developed this test. Low-dose CT has already been demonstrated to be a very effective way of identifying patients who potentially might have lung cancer early enough. But it requires screening, or lung nodules are found incidentally, as I mentioned during the presentation, which, by the way, is by far the majority of lung nodules that are found today, is through that mechanism. And the challenge, though, is there's a lot of false positives, so to speak. The nodules are benign. And so having a classifier like Nasal Swab to help really determine which patients are low risk or high risk for lung cancer is very much an unmet need. And having a test that's as non-invasive as a simple Nasal Swab is clearly something that can fit very well into the physician's workflow.
I don't know if you want to add anything more.
No, we've spoken to so many customers who are physicians who run these nodule clinics. They themselves are afraid of what would happen if they were, in fact, to screen more patients because the number of false positives would completely overwhelm their system. They would spend all the time on surgical suites doing evaluation of nodules that will ultimately turn out to be benign. More than 60% ultimately end up being benign. So they need a test like Nasal Swab to become more efficient and effective.
Unfortunately, I had too many questions for not enough time. We will continue downstairs in Amarante 2 and really appreciate everybody joining us. Thanks, guys.
Thank you.
Thank you.