On January 13, 2021 Castle Biosciences, Inc. (Nasdaq: CSTL), a skin cancer diagnostics company providing personalized genomic information to improve cancer treatment decisions, reported certain unaudited preliminary performance results for the fourth quarter and full-year 2020 (Press release, Castle Biosciences, JAN 13, 2021, View Source [SID1234573965]).

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"At Castle, we are committed to providing innovative, clinically actionable dermatologic tests to improve patient outcomes," said Derek Maetzold, president and chief executive officer of Castle Biosciences. "In 2020, despite the challenges presented to us all by the global pandemic, our team remained focused on this commitment and performed exceptionally.

"We delivered year-over-year volume growth in 2020 in DecisionDx-Melanoma reports, our current lead revenue driver, despite a significant reduction in melanoma diagnoses that we believe was due to COVID-19. We also expanded our skin cancer suite of products, adding two new proprietary gene expression profile tests and increasing the estimated U.S. total addressable market (TAM) of our commercially available tests to $2 billion. We expanded our body of evidence in 2020, with 11 supportive peer-reviewed articles published for our four proprietary gene expression profile tests during the year. Evidence development remains a key component of our growth strategy, supporting adoption of our tests by clinicians and reimbursement by commercial payers.

"Even in the face of COVID-19, we more than doubled our employee headcount since the beginning of 2020 through December. Additionally, we completed two equity financings, further strengthening our balance sheet, as we look to accelerate future growth through expanded support for our currently marketed tests, including further commercial team expansion in the first half of 2021, and through our pipeline development."

Fourth Quarter Ended December 31, 2020, Highlights

Delivered 5,157 total gene expression profile test reports for all four marketed tests combined in the fourth quarter of 2020:
DecisionDx-Melanoma test reports delivered in the quarter were 4,246.
DecisionDx-SCC test reports delivered in the quarter were 428.
DecisionDx DiffDx-Melanoma test orders received and reports delivered from Nov. 2 through Dec. 31, 2020, were 92 and 73, respectively.
DecisionDx-UM test reports delivered in the quarter were 410.
Medicare Administrative Contractor (MAC), Palmetto GBA MolDx, issued a final expanded local coverage determination (LCD) and an accompanying billing and coding article for the Company’s DecisionDx-Melanoma test. Noridian, the MAC that oversees Castle’s laboratory in Arizona, issued an identical LCD and billing and coding article, which became effective Dec. 6, 2020. Since the effective date of Dec. 6, 2020, more than 90% of Medicare beneficiaries whose clinicians order DecisionDx-Melanoma as part of their melanoma management plan were covered under the expanded LCD. Additionally, final 2021 Medicare rates for both DecisionDx-Melanoma and DecisionDx-UM were published on Dec. 28, 2020, on the Centers for Medicare & Medicaid Services (CMS) website.
The Company launched its DecisionDx DiffDx-Melanoma test on Nov. 2, 2020. DecisionDx DiffDx-Melanoma is designed to aid dermatopathologists and dermatologists in characterizing difficult-to-diagnose melanocytic lesions.
On Dec. 18, 2020, Castle completed its underwritten public offering of 4.6 million shares of its common stock at a public offering price of $58.00 per share. The gross proceeds to Castle from the offering before deducting the underwriting discounts and commissions and other offering expenses payable by Castle, were $266.8 million.
Year- Ended December 31, 2020, Highlights

Total gene expression profile test reports delivered in 2020 were 18,185:
DecisionDx-Melanoma test reports delivered in 2020 were 16,232. While third-party data for December is still finalizing, data through November suggests that diagnoses of melanoma were down 19% in 2020 over the prior year.
DecisionDx-SCC test orders received and reports delivered in 2020 (Aug. 31, 2020 – Dec. 31, 2020) were 562 and 485, respectively.
DecisionDx DiffDx-Melanoma test orders received and reports delivered in 2020 (Nov. 2, 2020 – Dec. 31, 2020) were 92 and 73, respectively.
DecisionDx-UM test reports delivered in 2020 were 1,395.
The Company launched its DecisionDx-SCC test on Aug. 31, 2020. DecisionDx-SCC is a 40-gene expression profile test that uses an individual patient’s tumor biology to predict individual risk of squamous cell carcinoma metastasis for patients with one or more risk factors. The test result, in which patients are stratified into a Class 1, 2A or 2B risk category, is designed to predict individual metastatic risk to inform risk-appropriate management.
11 peer-reviewed articles to support physician adoption and commercial payer reimbursement of Castle’s currently marketed tests were published in 2020.
Palmetto GBA MolDx, Noridian and associated Medicare Administrative Contractors (MAC) reviewed the DecisionDx-Melanoma data package as part of a reconsideration request in mid-2019 to review an expansion of coverage criteria for DecisionDx-Melanoma. LCD drafts were finalized in the second half of 2019 and effective in the fourth quarter of 2020. The Company believes that this data package demonstrating medical necessity also positively impacted reviews by commercial payers in that 288 insurance companies reviewed and approved claims for DecisionDx-Melanoma in 2020. Additionally, several regional health plans and a Blue Shield licensee have independently reviewed DecisionDx-Melanoma and have either issued or retired medical policies to support the medical necessity of DecisionDx-Melanoma.
Year-end 2020 cash and cash equivalents were approximately $410 million.
Castle Biosciences has not completed the preparation of its financial statements for the fourth quarter or full-year 2020. The preliminary, unaudited performance results presented in this press release for the quarter and year-ended December 31, 2020, are based on management’s initial review of the information presented and are subject to adjustment based on the completion of the Company’s end-of-period reporting processes and related activities, including the audit by our independent registered public accounting firm of the Company’s financial statements, as such, any financial information contained herein may differ materially from the information reflected in our financial statements as of and for the year-ended December 31, 2020. Additional information and disclosures would be required for a more complete understanding of the Company’s financial position and results of operations as of and for the quarter and year-ended December 31, 2020. Accordingly, undue reliance should not be placed on this preliminary information.