Quarterly Financial Report Discussion for Burning Rock Biotech Limited in 2022's Second Quarter
Burning Rock Biotech Limited, a leading Chinese precision oncology company, has recently released its Q2 2022 financial results. The company specialises in circulating tumour DNA (ctDNA)-based tests, including minimal residual disease (MRD) detection for cancer monitoring.
The company's MRD test identified almost three times as many high-risk patients as a six-panel approach at the landmark timepoint, demonstrating the potential of their MRD products. The upcoming studies like the Circulate Depend and Dynamic are expected to answer questions about the MRD utility in colorectal cancer.
The data for multi-cancer early detection was released with over 2000 participants for nine cancer tests at ESMO in September. The company is investing in multi-cancer early detection, which they believe is the ultimate solution for cancer early detection, powered by multidimensional testing, including methylation, NGS, and machine learning.
The company's MRD test is showing promising results, with longitudinal MRD negative patients, which are the blue line, having a near-perfect prognosis in about three years on follow-up. The prognosis separation between MRD positive and MRD negative patients, defined by brProphet, is across different stages.
The company started with therapy selection business in 2014 and has grown to be the market leader in this segment. The pharma business is profitable and has strong growth, with the revenue of biopharma growing triple-digit year-on-year to RMB 18 million, contributing to 14% of all revenue.
Despite challenges in Shanghai and Beijing due to lockdowns, the company reported a year-on-year increase in Q2 revenue. The in-hospital model revenue has shown strong increased, and the pharma revenues continued to go up in the second quarter, representing 14% of the total revenues.
The company carried out a organisation optimization program in the second quarter, resulting in a decrease in headcount for the oncology sales organization. The competition in multi-cancer early detection registration has improved recently, and the company is optimistic that the colorectal cancer community will catch up with the awareness of the MRD usage, similar to the lung clinicians community.
The company's guidance for the full year 2022 retains, despite the lingering Covid risk. The company is confident about the guidance, based on the underlying trends from pharma and MRD, and additional gains in the hospital, provided there's no further Covid impact.
The company's cash balance as of the end of the second quarter is RMB 1.15 billion, or $172 million. The call took place on August 31, 2022, at 8:30 a.m. ET.
For a more detailed outlook, consult company financial reports, investor presentations, and earnings calls after Q2 2022. Market analysis reports focusing on MRD testing and Chinese biotech sectors, as well as news coverage on industry developments impacting circulating tumour DNA testing, may also provide valuable insights.
The company is also making strides in early detection. The Promise study, which is the pilot case-control study for a noncancer type assay, has been completed and the results will be released at the coming ESMO in a few days. The company launched a trial composed of 12,500 participants for early detection, which is China's first multi-cancer prospective interventional study.
In summary, Burning Rock Biotech Limited is demonstrating strong growth in its MRD and pharma business, with promising results from their MRD tests and a growing pharma revenue. Despite challenges in Shanghai and Beijing, the company reported a year-on-year increase in Q2 revenue. For a more informed outlook, consult company financial reports, investor presentations, and earnings calls after Q2 2022.
- Burning Rock Biotech Limited, a Chinese precision oncology company, has recently shown the potential of their MRD products, identifying almost three times as many high-risk cancer patients as a six-panel approach.
- The company is investing in multi-cancer early detection, believing it to be the ultimate solution for early detection, powered by multidimensional testing including methylation, NGS, and machine learning.
- The prognosis separation between MRD positive and MRD negative patients, defined by brProphet, is across different stages, with longitudinal MRD negative patients having a near-perfect prognosis in about three years on follow-up.
- Despite challenges in Shanghai and Beijing due to lockdowns, the company reported a year-on-year increase in Q2 revenue, with strong increases in both in-hospital model revenue and pharma revenues.
- The company carried out a organizational optimization program in the second quarter, resulting in a decrease in headcount for the oncology sales organization.
- The company is making strides in early detection, with the completion of the Promise study for a noncancer type assay and the launch of a trial composed of 12,500 participants for early detection, which is China's first multi-cancer prospective interventional study.
