Adaptive Biotechnologies (ADPT) 2026年第三季法說會：上調 MRD 財測指引

重點摘要

• Adaptive Biotechnologies 公布 2026 年第三季營收達 8,390 萬美元，年增 39%。其中 MRD 業務貢獻 7,260 萬美元，占總營收的 86%。
• 在扣除去年同期 650 萬美元的里程碑款項後，核心 MRD 營收年增 44%。臨床檢測量成長 46%，而 MRD 藥廠定序營收則成長 55%。
• 該公司較管理層預期更早實現獲利。調整後 EBITDA 為 1,430 萬美元，GAAP 淨利為 280 萬美元，自由現金流總計達 800 萬美元。
• clonoSEQ 檢測交付近 40,000 次，季增 10%。血液檢測量年增 68%，基層醫療檢測量則季增 14%。
• 管理層將 2026 全年 MRD 營收財測從 2.68 億至 2.78 億美元上調至 2.76 億至 2.86 億美元，反映出臨床檢測量與藥廠定序業務的強勁表現。
• 受惠於 MRD 在多發性骨髓瘤藥物開發中的應用增加，MRD 藥廠在手訂單達到約 2.7 億美元，年增 34%。

核心財務數據

業務與營運表現

clonoSEQ 臨床檢測

臨床檢測量年增 46%，臨床營收增加 41%。Adaptive 交付了近 40,000 次 clonoSEQ 檢測，較第二季增加約 3,500 次。

DLBCL 檢測量以 20% 的季增幅領跑成長。占臨床檢測量 45% 的多發性骨髓瘤則季增 11%。管理層預期 DLBCL 將維持主要成長動能，同時強調多發性骨髓瘤也應會持續做出重大貢獻。

血液檢測在年增 68%、季增 12% 後，占 clonoSEQ 總檢測量的 51%。在多發性骨髓瘤中，血液檢測占 MRD 檢測的 31%。

基層醫療檢測量季增 14%，占總檢測量 37%，高於去年同期的 31%。本季約有 5,600 名臨床醫師開立 clonoSEQ 檢測，年增 37%，約占全美血液與腫瘤醫療提供者的 40%。

目前近半數訂單來自整合電子病歷 (EMR) 的客戶。在整合 Flatiron 系統的基層醫療客戶中，到期連續監測訂單的完成率達 78%。

保險給付與平均售價 (ASP)

美國平均售價為 1,380 美元，年增 3%，與前一季大致持平。Adaptive 擴大了 DLBCL 和外套膜細胞淋巴瘤的商業保險給付範圍，並在伊利諾州和俄亥俄州新增 Medicaid 補助納保。納保州目前約占 Medicaid 檢測量的 62%，而 Medicaid 的 ASP 則年增 26%。

聯邦醫療保險 (Medicare) 與 Medicare Advantage 約占給付機構組合的 45%，高於去年同期的 39%。目前的 Medicare 療程費率一生最多涵蓋四次檢測。更頻繁的監測使部分病患超出該給付額度，進而為實際實現的 ASP 帶來壓力。

Adaptive 已向 MolDX 提交技術評估，尋求額外納入包含五次多發性骨髓瘤檢測的維持期套裝給付。管理層表示討論進展正面，但無法保證核准時間或最終納保的檢測數量。

MRD 藥廠業務

不計里程碑款項，MRD 藥廠定序營收年增 55%。Adaptive 新增或修訂了 27 項研究，使其全球進行中的研究組合達到 191 項。

在手訂單達到約 2.7 億美元，年增 34%。多發性骨髓瘤約占進行中研究的 60%、在手訂單的 65% 以及新簽約額的 79%。

該公司有 19 項將 MRD 列為主要終點的多發性骨髓瘤研究，高於去年同期的 12 項。clonoSEQ 也被應用於涵蓋多發性骨髓瘤、CLL 和 ALL 的 23 項介入性研究中。

管理層將此成長動能歸功於 FDA 將 MRD 列為加速審批終點的指引草案、多發性骨髓瘤治癒的新定義，以及納入更多檢測時間點的試驗設計。

免疫醫學業務

免疫醫學營收為 1,130 萬美元，主要反映與輝瑞 (Pfizer) 的類風濕性關節炎標靶發現協議。該部門創造了 320 萬美元的調整後 EBITDA。

Adaptive 繼續與摩根士丹利合作推動分拆免疫醫學業務，並有望依進度在 2026 年底前公布後續規劃。

管理層財測

管理層未提供 2027 年財測，但表示在臨床數據、指引採納、血液檢測、EMR 整合及基層醫療拓展的支撐下，預期強勁成長將得以延續。

風險與關注事項

• 由於目前的療程費率在病患一生中僅涵蓋四次檢測，因此更頻繁的 Medicare 檢測正帶來近期 ASP 的壓力。
• MolDX 的核准時間以及維持期套裝所涵蓋的檢測數量仍存在不確定性。
• Adaptive 發現與 clonoSEQ 的 PLA 代碼初步 CMS 定價相關的錯誤數據。該公司正與 CMS 合作，在最終費率發布前進行更正。
• 藥廠營收在各季之間可能分布不均，且管理層對第四季是否有額外的里程碑營收缺乏能見度。
• 儘管第三季實現 GAAP 獲利，管理層仍預期第四季或 2026 全年 GAAP 淨利或 EPS 不會轉正。
• 會中討論了 DLBCL 領域的競爭，但管理層表示，clonoSEQ 的保險給付覆蓋率、臨床經驗與客戶關係鞏固了其市場地位。

分析師問答重點

管理層表示，CMS 初步 PLA 費率設定程序不應影響占 Medicare 大部分營收的單次療程給付架構。Adaptive 正尋求更正用於初步 PLA 費率的數據。

針對 2027 年及以後，管理層認為指引採納與持續擴大的臨床實證是成長的基石。EMR 最佳化、連續監測檢測、血液檢測與基層醫療滲透率預計仍將是主要的營運槓桿。

在資本配置方面，該公司計劃將獲利重新投資於真實世界數據 (RWD)、AI 驅動的流程自動化、營收週期管理、客戶體驗與研發。管理層也在評估其免疫定序平台在血液學以外的新應用，但尚未提供具體的商業化計畫。

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管理層陳述

Operator

Good day, and thank you for standing by. Welcome to the Adaptive Biotechnologies Third Quarter 2026 Financial Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Karina Calzadilla, Head of Investor Relations. Please go ahead.

Karina Calzadilla

Thank you, Daniel, and good afternoon, everyone. I would like to welcome you to Adaptive Biotechnologies Third Quarter 2026 Earnings Conference Call. Earlier today, we issued a press release reporting Adaptive financial results for the third quarter of '26. The press release is available at www.adaptivebiotech.com. We are conducting a live webcast of this call and will be referencing to a slide presentation that has been posted to the Investors section of our corporate website.

During the call, management will make projections and other forward-looking statements within the meaning of federal securities laws regarding future events and the future financial performance of the company. These statements reflect management's current perspective of the business as of today. Actual results may differ materially from today's forward-looking statements, depending on a number of factors, which are set forth in our public filings with the SEC and listed in this presentation. In addition, non-GAAP financial measures will be discussed during the call, and a reconciliation from non-GAAP to GAAP metrics can be found in our earnings release. Joining the call today are Chad Robins, our CEO, Co-Founder; and Kyle Piskel, our Chief Financial Officer. Additional members from management will be available for Q&A.

With that, I'll turn the call over to Chad. Chad?

Chad Robins

Thanks, Karina. Good afternoon, and thank you for joining us on our third quarter earnings call. Q3 was a breakthrough quarter for Adaptive. We achieved profitability at the total company level ahead of expectations, while continuing to deliver rapid MRD growth. MRD revenue, excluding milestones, increased 44% year-over-year, driven by clinical testing volume and pharma sequencing revenue. We achieved total company gross margin of 76%, generated $8 million in free cash flow and ended the quarter with approximately $386 million in total cash. These results demonstrate that we have been building toward a business that combines rapid growth with a strong financial profile. Achieving profitability reflects years of disciplined execution, thoughtful capital allocation and targeted investment in sustainable growth. The opportunity ahead continues to expand. Updated guidelines and a new definition of cure in multi myeloma strengthened the clinical foundation for clonoSEQ. With clinical volumes and pharma revenue exceeding our expectations, we are again raising our full year 2026 MRD revenue guidance.

On the immune medicine front, we are working closely with Morgan Stanley to advance the separation process and remain on track to announce the path forward by year-end. This quarter, the business also earned a milestone payment from Pfizer following the successful delivery of rheumatoid arthritis data under our agreement, an important accomplishment for the team.

Let's take a closer look at MRD clinical business on Slide 4. Clinical testing volume was a standout in Q3, growing 46% year-over-year and driving 41% growth in clinical revenue. We delivered nearly 40,000 clonoSEQ tests, up 10% sequentially or approximately 3,500 additional tests. Every reimbursed indication contributed to growth. DLBCL led with 20% sequential growth, while multiple myeloma contributing 45% of volume grew 11%. Our commercial team is executing across several fronts to drive and sustain this growth. Among those priorities are expanding blood-based testing, increasing community adoption and embedding clonoSEQ into clinical workflows. We advanced all 3 this quarter.

Blood-based testing grew 68% year-over-year and 12% sequentially, representing 51% of total clonoSEQ volume. In myeloma, blood-based tests now represent 31% of MRD testing, giving physicians a more accessible option for monitoring patients over time. Community volume grew 14% sequentially, outpacing academic centers. Community practices now account for 37% of total volume, up from 31% a year ago, extending clonoSEQ's reach to more patients. We are also making testing easier to order and repeat. Nearly half of our orders now come from EMR integrated accounts, where our team is focused on both adding integrations and increasing utilization.

In Flatiron integrated community accounts, 78% of serial monitoring orders due have now been fulfilled, demonstrating follow-through on planned patient monitoring. Our clinician base is expanding across both community and academic settings. Approximately 5,600 clinicians ordered clonoSEQ in Q3, up 37% year-over-year and representing about 40% of U.S. hematology/oncology providers. That reach underscores MRD's growing role in clinical care. As adoption expands and physicians monitor patients more frequently, we are advancing our reimbursement strategies to support that use.

Let's turn to Slide 5. U.S. ASP was $1,380 in Q3, up 3% year-over-year and relatively flat sequentially. We continue to expect approximately $1,400 average ASP for the full year and have clear catalysts to advance our longer-term goal of $1,700 to $1,800 per test. Let me start with this quarter's coverage gains. We expanded commercial coverage in DLBCL and MCL, 2 indications with substantial reimbursement opportunity. In DLBCL, we added Avalon and Concert. In MCL, we added Avalon, Blue Cross Blue Shield and United. We also expanded Medicaid coverage into Illinois and Ohio and have now established coverage in states representing approximately 62% of our Medicaid testing volume.

While Medicaid represents about 10% of our payer mix and remains our lowest paying segment, coverage gains are delivering results. Medicaid ASP increased 26% year-over-year. The largest opportunity ahead is Medicare and Medicare Advantage, which now represent approximately 45% of our payer mix, up from 39% a year ago. Here, increasing testing frequency is an important part of the ASP story. The current Medicare episode rate covers a bundle of up to 4 tests over a patient's lifetime. As physicians monitor more patients more frequently, a growing proportion is moving beyond those 4 tests, putting pressure on realized ASP. We saw this dynamic in Q3, particularly in multi myeloma, our largest indication.

That said, supporting this testing also enabled us to generate the evidence to pursue expanded coverage. We have now submitted our technical assessment to MolDX for an additional maintenance testing bundle in multi myeloma, and we are in active discussions. This is our priority catalyst with recent NCCN guideline updates further strengthening the clinical rationale for our submission. In addition for the maintenance bundle for myeloma, we are also pursuing recurrence monitoring coverage in several indications. Recurrence monitoring is already covered in MCL, and we expect to submit for CLL in the first half of next year, but we are also generating data now in multiple myeloma. Our conviction in the $1,700 to $1,800 ASP opportunity remains strong. Clinical use is expanding, and we have specific coverage initiatives underway to translate that use into broader reimbursement.

Now let's turn to Slide 6 and the advances in multi myeloma that support Pulse's strategy and clonoSEQ's longer-term potential. Two major developments this quarter strengthened the foundation for MRD testing in multi myeloma, our largest indication in both clinical testing and in pharma. First, the updated NCCN guidelines give MRD testing greater prominence and incorporate more specific direction. For the first time, the guidelines include a dedicated page on the principles of MRD testing. They recommend using an FDA-approved assay such as clonoSEQ, which is specifically named and identified 10 to the minus 6, which is 1 cancer cell in 1 million cells as the preferred sensitivity because of its higher prognostic value. clonoSEQ is, in fact, the only assay that can deliver 10 to the minus 6 sensitivity with the scale required for broad clinical use.

This is meaningful recognition of the rigor that clonoSEQ brings to MRD assessment. The guidelines also specify testing time points during maintenance and surveillance, reinforcing MRD's role beyond the initial treatment response. For community oncologists, in particular, clear direction on when and how to test can help translate clinical evidence into more consistent use. Importantly, the guidelines now address MRD-guided therapy, stating that MRD negativity can inform shared decisions on treatment intensity, while rising MRD may prompt increased vigilance and monitoring.

The second development is equally significant, a new definition of cure presented on behalf of the International Myeloma Working Group at the International Myeloma Society Annual Meeting. The definition describes 5 years off treatment with sustained MRD negativity demonstrated by at least 4 negative assessments with no positive MRD results. Testing must use next-generation sequencing or next-generation flow at a sensitivity of 10 to the minus 6. Again, clonoSEQ is the only assay that can deliver at this scale. The implication is powerful. Repeated, highly sensitive MRD assessment is central to determining which patients meet this definition. clonoSEQ is directly aligned with the cure definition requirements, further supporting our recurrence monitoring strategy. Together, these developments reinforce our MRD should be measured and why it should be followed over time. We are excited to see systematic MRD assessment becoming more central to how the field evaluates treatment success. The focus on deeper, sustained responses is also shaping drug development.

Let's turn to Slide 7 and our MRD pharma business. Our MRD Pharma business delivered one of its strongest quarters in several years, driven by accelerating adoption of MRD in drug development, particularly in multi myeloma. The underlying sequencing business generated 55% year-over-year revenue growth, excluding milestones, and we now expect pharma sequencing growth for the full year at approximately 25%. We added 27 new or amended studies during the quarter, bringing our portfolio to 191 active global studies. Backlog reached approximately $270 million, up 34% year-over-year, providing visibility into future revenue and underscoring continued demand from our biopharma partners.

Multi myeloma represent approximately 60% of active studies and 65% of backlog and accounted for 79% of new bookings this quarter. There are several key trends driving this outsized growth in multiple myeloma. First, FDA's January draft guidance around use of MRD as an accelerated endpoint was a clear signal of regulatory acceptance. We now have 19 multi myeloma studies using MRD as a primary endpoint, up from 12 a year ago. Additionally, the new definition of cure adds another dimension to that opportunity. We are already seeing multi myeloma trials incorporate more testing time points to enable assessment of a cure fraction, contributing to higher bookings per study.

Our partners are also evaluating how MRD can guide treatment itself. clonoSEQ is now used in 23 interventional studies, including multi myeloma, CLL and ALL, helping build the evidence for MRD-directed treatment decisions. For our pharma business, this creates opportunities through more studies using MRD as an endpoint, more assessments over time and an expanding role in guiding therapy. Across clinical and pharma, Q3 demonstrated the commercial strength of clonoSEQ. The advances in evidence, guidelines and trial design reinforce our conviction in the opportunity ahead.

I'll now turn it over to Kyle to review our financial results. Kyle?

Kyle Piskel

Thanks, Chad. I'll start on Slide 8 with our third quarter results. As a reminder, amortization of Genentech payments within Immune Medicine is excluded from all prior period comparisons. Total revenue was $83.9 million, up 39% year-over-year, driven by MRD growth and revenue from our Pfizer rheumatoid arthritis agreement in Immune Medicine. MRD represented 86% of total company revenue. MRD revenue was $72.6 million, up 28% year-over-year. Excluding $6.5 million of milestone revenue recognized in the third quarter of last year, core MRD revenue grew 44%. Clinical and Pharma represented 75% and 25% of MRD revenue, respectively. Immune Medicine revenue was $11.3 million, primarily reflecting the revenue from our target discovery agreement with Pfizer.

Turning to margins. Sequencing gross margin, which excludes MRD and Immune Medicine milestones, increased to 73% from 66% a year ago. MRD sequencing gross margin was 74%. The expansion reflects lab efficiencies following our NovaSeq X transition and operating leverage from higher testing volumes. Total operating expenses, including cost of revenue, were $84.4 million, up 1% year-over-year. Continued investment in our commercial infrastructure, including reimbursement and EMR integration initiatives was partially offset by lower R&D spend in Immune Medicine.

At the segment level, MRD adjusted EBITDA increased to $15.1 million compared to $7 million a year ago, reflecting the combination of strong revenue growth and continued operating leverage. Immune Medicine adjusted EBITDA for the quarter was $3.2 million. Total company adjusted EBITDA was positive at $14.3 million, a significant achievement reflecting growth and spending discipline. GAAP net income for the quarter was $2.8 million. While this is another significant accomplishment, we do not currently anticipate GAAP net income or positive EPS for Q4 or the full year.

Turning to Slide 9 on updated guidance. We're raising our full year MRD revenue guidance to a range of $276 million to $286 million, up from our prior range of $268 million to $278 million. This increase reflects stronger-than-expected clinical volume and pharma sequencing performance in the third quarter as well as higher year-over-year clinical volume growth expected now at approximately 42% versus our prior guidance of 38% to 40%. Our guidance continues to include $9 million of MRD milestone revenue, which was all recognized in the first quarter with no additional milestone revenue assumed for the remainder of the year.

At the midpoint, our updated guide represents 32% year-over-year MRD revenue growth or 41% excluding milestones. We now expect full year operating expenses of approximately $350 million at the lower end of our prior range of $350 million to $355 million and approximately 5% above last year. We are delivering higher growth while maintaining spending discipline.

With that, I'll turn the call back over to Chad.

Chad Robins

Thanks, Kyle. We entered Q4 with broad-based growth, profitability ahead of expectations and a higher full year revenue outlook. Our maintenance bundle submission is now with MolDX, and we are in active discussions on this potentially significant catalyst to expand reimbursement for ongoing testing. At the same time, advances in guidelines, the definition of cure and drug development are elevating the role of MRD and expanding clonoSEQ's long-term potential. Profitability represents an exciting inflection point for our business, enabling us to reinvest in deepening our competitive advantages and to capture the significant growth opportunities that lie ahead.

With that, operator, we'll open it up for questions.

Operator

[Operator Instructions] Our first question comes from Subbu Nambi with Guggenheim.

分析師問答

Unknown Analyst

This is Thomas on for Subbu. In regard to the CMS rates drafted for 2027, can you just talk about exposure to clonoSEQ based on your current split of Medicare and non-Medicare volumes and how that might impact ASP in the near term? Or if you have any levers to help offset any pressures and remain on track with ASP targets?

Kyle Piskel

Yes. Let me address the CMS, the PLA code and the PAMA legislation. Maybe just as a reminder, at the beginning of the year, we determined we were not an applicable laboratory under the PAMA regulations. And as such, we did not submit any private payer data to CMS as part of this. When CMS published the preliminary rates, we identified that erroneous data was submitted on the clonoSEQ PLA. And the reason we know that is because we are the only laboratory that can perform the test. And a quick reminder of why we are not in applicable laboratory is because of the episodic billing structure with Medicare, the vast majority of our Medicare revenues comes from the bundled structure. And again, when we talk about the insulation related to the business, we don't believe the PLA rate setting process should have any pull-through into the episodic framework. And separately, with CMS, we are engaged in rectifying and correcting the erroneous data, which we do not believe and have made clear with CMS that they should not be relying on any erroneous data to set a price point for the clonoSEQ PLA code.

So we're anticipating getting that results prior to the finalized rates, which should go live sometime in November as we understand with CMS. And we remain confident in kind of the long-term pricing strategies that we have in play. And that's only further supported by the advances we're having with our contracted payers, the rates we have in place and our structure with MolDX.

Unknown Analyst

Great. And then this year, another great quarter. You've had a combination of a lot of key growth drivers working together. Just curious, as you think to next year in '27, what's going to be the biggest lever you have to reach that next phase of growth for clonoSEQ? Is it blood? Is it the EMR pull-through? Just how to think about the most crucial pieces to growth next year as people start to underwrite that growth?

Julie Rubinstein

Thanks for the question. Even though we're not providing guidance on 2027, I certainly don't see any reason not to believe that we'll continue to grow at a very high rate in 2027 and beyond. We have a high ceiling remaining. We intend to continue focusing on many of the same drivers that have gotten us to the place we are today. I think the foundations of that growth in 2027 will really be the data and the guidelines. The guidelines have been very favorable for MRD and for clonoSEQ specifically over the last 18 months, and there are many opportunities to pull through those updates in the clinic. And they also will be favorable for our pharma business as a side note because the definition of cure in multiple myeloma will help to drive increasing long-term testing time points so that pharma companies can assess their drug's efficacy in the context of cure. The data will continue to develop. We're very excited about the data you'll see at ASH in just 1.5 months. We can talk more about that later.

And beyond those 2 foundations, the real enablers of growth that we focus on are the same things that we've been talking about, EMR integration, blood-based testing, expansion in the community. These are synergistic with one another in many ways. We started working on EMR a few years ago, and we've integrated many of our key accounts, but it doesn't stop there because the big focus going forward is optimizing how integrations are being used, particularly to enable serial testing. And we've seen high rates of pull-through on serial testing with our Flatiron implementation in OncoEMR. We continue to see increases in blood. We're investing in product development in that regard to enhance the performance of the product in blood. And community is now contributing 37% to our volumes, and the guidelines will strengthen our ability to educate and promote the use of consistent testing across community practices. So we do continue to expect strong growth in 2027 and beyond, and it will be a combination of all those factors.

Operator

Our next question comes from Casey Woodring with JPM.

Casey Woodring

I guess the first one, it looks like the strongest clinical volume sequential growth was in DLBCL. There's been some competitive noise there. Just can you talk about what you're hearing from customers and your competitive moat in DLBCL going forward? And if you would expect that to continue to like be the strongest sequential kind of growth driver in volumes moving forward?

Julie Rubinstein

Yes. In our DLBCL sequential growth has continued to be very strong and fairly consistent quarter-over-quarter. And my expectation is that we will continue to deliver consistent double-digit growth rates on an ongoing basis. We do hear about competitors in the field, but we have a very strong position from which to continue to grow, and that includes the test itself and it's custom-built for blood cancers, including lymphomas, the reimbursement that is already established broadly for our test in lymphomas, the ability to continue to leverage our real-world experience and then now about 9,000 patients who have been tested with clonoSEQ for all these reasons as well as the fact that we have these established relationships with our key customers and continue to delight them, I'm very confident in our position in this field. And in the end, this is a very underpenetrated market. So the noise that is being created by additional companies talking about MRD and DLBCL is beneficial and disproportionately beneficial to us as the market leader. We are excited about the data that we will continue to advance in this space, and I think you'll see a good amount of that at ASH this year. And we believe that we are in a good position both in the short term, leveraging our moats, leveraging the sort of noise around MRD and also in the longer term where we believe the performance of our technology will really win the day.

Casey Woodring

Got it. That's helpful. And then I think you alluded to it in an earlier question, but 64% of your MRD pharma backlog increase was from multiple myeloma. Is that related to guideline updates or the new cure definition? Or just more generally speaking, kind of what's driving the momentum in multiple myeloma right now?

Julie Rubinstein

Yes, there are several reasons that we're seeing an improvement in our MRD -- in our myeloma pharma business. And I think one thing is that earlier this year, the accelerated endpoint that was adopted by ODAC back in 2024, the FDA actually issued draft guidance to really sort of cement the use of that endpoint. And I think a number of pharma companies saw that as an important signal to move forward with new primary endpoint studies, and we've seen quite a number of new primary endpoint studies in 2026.

The second is the definition of cure that was issued by the IMS just about a month ago. Many of our pharma clients have been anticipating that. It's been talked about among KOLs for a number of months. And so studies being designed today are incorporating more time points, as I alluded to earlier, to be able to make that cure claim for the therapeutics that are being evaluated in the study. And that's resulting in higher bookings, more time points. And then lastly, just the increase in regulated and interventional use. We now have 23 additional studies, including 8 multiple myeloma. The number of regulated studies is now the majority of our trials are regulated. And so we're seeing that overall MRD is just becoming a standard of how studies are being done in multiple myeloma, and that will continue, we believe, to contribute to strength for our pharma business going forward.

Operator

[Operator Instructions] Our next question comes from David Westenberg with Piper Sandler.

David Westenberg

I do wanted to jump on the DLBCL strength. It grew 20% sequentially in the quarter and remains a pretty underpenetrated opportunity. So what really were the biggest drivers of DLBCL up 20%? And then what -- how should we think about that as a contributor to growth over the next few years? Should we think about DLBCL as really being the predominant accretive to growth driver in '27 and '28?

Julie Rubinstein

Yes. I mean, David, thanks for the question. As you said, we've been really pleased with the DLBCL growth, which has continued to outpace all other indications. And the growth is broad-based. It's coming from both community and academic accounts. We've been particularly successful of late driving increased adoption in some of the largest community practice networks. Some of our largest DLBCL growth this past quarter came from one of the largest networks in the country. And all of this is a result of continued just focus on market development. We have to educate on the role of MRD, how it can augment and improve upon PET scans and other sort of more traditional ways of thinking about disease burden and how it can inform treatment. And there are now a number of studies in motion and a few that are even reading out at ASH showing different ways that MRD can be useful in informing treatment selection and escalating or deescalating therapy in DLBCL.

So we continue to expect it to be a top growth driver for the next few years, particularly given the investments we're making in data and the potential for pharma to expand its investment in MRD-guided therapy trials in the future.

Chad Robins

But David, even though multi myeloma has been a large grower, it's going to still be a major contributor to our growth, especially with updated guidelines and the new definition of cure. And just to kind of up level this a minute. I mean, it's hard to kind of understate how big a deal this is. We believe that this is the first definition of cure based on an NGS test. Basically, they're saying, if you're MRD-negative using clonoSEQ, for kind of 4 different tests, then you're cured of a disease. I was just an anecdote, we had investigators when they found this up crying in the hallway. They've been working on this for over a decade. So it's just -- this is -- myeloma is going to be -- continue to accelerate.

David Westenberg

Got you. And then I was kind of going to jump on -- I appreciate that I add some color. I want to jump on the $1,400 ASP target. I think you came in, I think you said $1,386. How much of this is blocking and tackling versus some of the new adds that you mentioned, new coverage adds that you mentioned. And we are in November of this time. So I mean, in order to get to that $1,400, do you need any kind of timing specific to get you there in terms of timing coverage? And I'll stop there.

Kyle Piskel

Yes. I appreciate the question, David. This is Kyle. Certainly, blocking and tackling plays into every quarter. I think blocking and tackling is a contributor even in the fourth quarter. Certainly, as we think about the guide and the year, one of the factors is frequency uptake as it relates to Medicare and the pressure we're seeing there, which ultimately is a good thing. So I think there are some timing dependencies that could move the needle in either direction. But foundationally, I think we're in a good place, and there are some timing considerations, but we'll see how those play out, but we're confident in kind of the long-term trajectory here and continue to be confident in getting to that $1,400 at some point.

Chad Robins

Yes. And David, maybe if I could just kind of add a little bit of color and context. Some of the -- a little bit of the ASP pressure that you're seeing is actually what is beneficial and what we're using to -- for our MolDX submission. And if you think about kind of our overall strategy, think about this in kind of -- there's 3 different kind of phases of a patient's treatment continuum. Kind of the first is active treatment phase, which we're already reimbursed by Medicare for 4 tests, okay? The second, and this is what we're -- we've already submitted and are in active, very positive discussions with MolDX on is what we're calling kind of the maintenance treatment phase. And we've submitted for an additional bundle of 5 tests. So this is the first time I've kind of said that, but that we've submitted for an additional 5 tests during the maintenance setting.

And then the third is the recurrence monitoring. And we also mentioned during this call in multi myeloma that the second half of this year, we believe we have data from the recurrence monitoring. So that really kind of hits all 3 phases of a treatment of a patient's kind of care continuum. And again, I think it's not a matter -- we believe it's not a matter of if, it's a matter of when. And we're, I would say, highly encouraged based on these discussions that we have -- that we'll have an upcoming catalyst when we get this maintenance bundle. We can't be -- I just want to be clear, though, we can't guarantee kind of the number of tests in the bundle. We can't guarantee timing. I can just guarantee that what I can tell you is the discussions have been very, very positive. It's recognized that this is necessary and it fits really perfectly with the new NCCN guidelines and the new definition of cure.

So all of these factors are converging to say that you need to both monitor a patient more frequently at all phases kind of during this care continuum. So that's kind of -- I just want to provide a perspective on how this is all working together and our broader-based reimbursement strategy so that we're not thinking that a short term -- we do believe we're going to be approximately at $1,400 this year. And timing-wise, we may see some very slight variation or fluctuation. But what we have seen is we have more confidence than ever kind of based on these discussions that we're having that our ASP targets of $1,700 to $1,800 that we will not only hit them, that we believe that we will hit them that we can potentially even accelerate that time frame in some cases.

Operator

Our next question comes from Dan Brennan with TD Cowen.

Daniel Brennan

Congrats on the quarter. Maybe just on the pharma side, really good pharma numbers again. Just can you just give us a flavor of what's happening on the pharma side of the business, like kind of what's baked in for the fourth quarter? And just kind of update us again on the milestone opportunity as we look ahead, maybe not this year, but just beyond just what type of milestones, say, next 12 months might be realistic?

Kyle Piskel

Yes, Dan, I appreciate the question. I mean we're really excited about the kind of bookings and backlog growth we're seeing in the pharma business as well as the print in the third quarter. As you know, quarter-to-quarter can be lumpy from a revenue perspective. But I think when we think about the longer-term opportunity and the growth we're seeing in that business, backlog at the end of Q3 was $270 million, up from $200 million a year ago, really setting us up for some strong growth. We're now looking at 25% year-over-year growth in the pharma business, excluding milestones. So it's setting us up for a good position heading into 2027.

With respect to milestones, we said we don't have any visibility into Q4 into any milestones. And again, we think about that when we get line of sight. We'll update our guidance with respect to that. We don't necessarily control that timing, but we still have a healthy backlog of milestone opportunities that could read out. It's just really difficult to model and predict the timing of that, but still expect to see some of those over the course of the next coming years as well. And we'll provide more color at the next earnings call around that.

Julie Rubinstein

Yes. And just to chime in a bit on the dynamics that are really sort of important. Again, I think reiterating the fact that the FDA draft guidelines or guidance that was issued earlier this year, the definition of cure, which is encouraging companies to do longer studies with more time points, the interventional nature of many of the study designs, all of these things combined with the fact that we have the only FDA-cleared assay and a strong reputation and relationship with these companies for delivering registrational grade data over many years, I think we continue to be in a really strong position to support the needs of the myeloma drug development programs for years to come.

Daniel Brennan

Great. And then the volumes, terrific volume again. You've been running in 30s and low 40s for a while now. Penetration still seems like it's not that high as the market. So -- and you have all these drivers kind of headed. Like how do we think about as we get to 4Q and then we lap into '27, most of us naturally have volumes coming down. You're not guiding for '27 right now, but it seems like there's still just so much momentum in the business. Any way to think about what volumes could be, say, over -- as we look out beyond '26 into '27, kind of what's the framework we could use?

Chad Robins

Obviously, Dan, we're not in a position yet to guide on '27. I can just tell you that there's a tremendous amount of internal excitement from our team and the conversations they're having with clinicians regarding the new definition of cure. The updated NCCN guidelines has given a great call point, particularly in the community where doctors are much more apt to follow guidelines. And we expect -- I'd just say we expect the momentum to continue. We see nothing that's slowing this down. On the contrary, I think there's been kind of 2 meaningful updates kind of overall in the industry, which kind of further support and gives us confidence in the growth trajectory ahead.

Operator

Our next question comes from Mark Massaro with U.S. Bancorp BTIG.

Mark Massaro

Some of us are hopping calls tonight, so pardon me if this has already been asked. But now that you've achieved company-wide profitability, should we think about any potential changes to capital deployment as we think about 2027? Also curious at a super high level, how you're thinking about the potential for exploring tuck-ins, assuming they made sense and we're disciplined. Just wanted to get a sense for how you're thinking about capital deployment now that you're a profitable company.

Chad Robins

Yes. I'll let Susan start on the areas we're investing in, in MRD, and I'll make some kind of broader comments as to kind of some things we're thinking about.

Susan Bobulsky

Yes. We've been growing at a high rate over several years, and we still have this big ceiling that we can continue to grow into. So as we become profitable, I think the best thing we can do is deploy those profits to continue to expand our moat and increase the trajectory of MRD adoption. So we've been very focused beginning this year on identifying strategic areas in which to invest. This year, our investment has been focused on capability building in a few key areas. Real-world data is one, AI and AI-driven business process automation, specifically, our revenue cycle management and developing the next-generation customer experience with a focus on facilitating serial testing. We made considerable strides in all 4 of these areas this year, and we intend to continue those investments in 2027.

I should also highlight that we have a robust R&D effort through which we're investing both in current product enhancement and an advancement of new products in order to extend our leadership in the spaces where we already play and also consider ways we can either leverage our channel or develop new applications of our proprietary platform.

Chad Robins

Yes. And again, one of the things to highlight, Susan mentioned kind of enhancing the performance of our existing clonoSEQ to deepen heme MRD and also kind of leveraging our heme channel to deliver kind of other things you could potentially do with that patient sample. But the third area, which we're actively in development on is new applications of our immuno sequencing platform to address kind of unmet medical needs kind of beyond hematology. There's some kind of really interesting potential applications of our platform that we're exploring. And again, not ready to talk about on this call, but I think what could be really interesting kind of large opportunities to kind of leverage our existing capabilities, both with our platform technology, but also with the infrastructure that we've built around how to deliver, how to get PET tests paid for, revenue cycle management and all the things that you need to do as a diagnostic company.

Mark Massaro

Okay. That's fantastic. And then I wanted to ask about the NCCN guideline recognition. What is your thinking in terms of -- you're already the dominant market leader. And so some of us are wondering how -- usually when you're #1, you can't do better than #1, but perhaps you could perhaps accelerate. But it's typically uncommon for market leaders that have been in the space for a while to accelerate. So I am curious what you think the benefits are from the NCCN recognition and clonoSEQ being called out in particular.

Susan Bobulsky

Yes. I mean we -- as was mentioned earlier, the opportunity is most substantial in community oncology where guidelines are particularly important. Clinicians are really looking for us to tell them how and when to test. And so we're very actively engaged in promoting the guidelines updates now and are seeing a great deal of engagement from clinicians. And one of the things that's important in the community to us is to find ways to help the practices align their practice with those guidelines to drive more consistent testing across all patients that they see. So that interacts with our EMR integration strategy and thinking about ways we can develop standardized testing pathways and protocols taking the accounts who are doing that successfully and bringing their stories to share across other accounts.

So that's the work that we're doing right now. I do think it's a potentially meaningful accelerator for the myeloma business. And importantly, also supports the maintenance bundle submission that's currently with MolDX and which will be an important future driver of ASP. So we have a number of opportunities folded in with these guidelines. It's also notable that the guidelines are really -- the guidelines combined with the cure definition are really underscoring the need for bone marrow testing. And I actually believe there's an opportunity to increase community testing to use bone marrow as a complement to blood in areas where they may not be doing so today. We are eager to work with them to help ensure that they can deliver the potential of a cure to as many patients as possible. And to do that, they need to incorporate clonoSEQ MRD testing in marrow as well as in blood.

Operator

I'm showing no further questions at this time. This concludes today's conference call. Thank you for participating. You may now disconnect.