On this page of StockholderLetter.com we present the latest annual shareholder letter from CareDx, Inc. — ticker symbol CDNA. Reading current and past CDNA letters to shareholders can bring important insights into the investment thesis.

 •  4/30/2024 Letter Continued (Full PDF)
 •  4/28/2023 CDNA Stockholder Letter
 •  More "Diagnostics" Category Stockholder Letters
 •  CDNA Benford's Law Stock Score = 75

CDNA Shareholder/Stockholder Letter Transcript:

2023 Annual Report


Dear CareDx Shareholders,
We concluded 2023 in a position of strength and market leadership despite facing a new set of
complexities associated with Medicare coverage changes only two months into the year. We
quickly assessed the situation and executed a strategic reset of our company priorities to adapt
to this change. Through our swift financial and operational actions, we mitigated the economic
impact of these changes, stabilized our revenue base, and ended the year with a strong balance
sheet. Our dedicated team worked tirelessly to ensure patient access to our cutting   edge
transplant innovations, overcoming hurdles and striving to emerge even stronger, while also
fighting to restore coverage. We also regained momentum in our testing services business, with
patient test volumes increasing sequentially in the last two quarters of 2023.
During this critical time, we witnessed continued support from leading medical societies and
patients, advocating for access to our transformative transplant molecular testing, including
AlloSure   and AlloMap  . These endorsements underscore the important role our innovations
play in enhancing transplant patient care.
In 2023, CareDx achieved several milestones, making continued progress in driving our
innovations into clinical practice.

Delivered approximately 165,700 patient testing results to transplant patients.

Achieved two industry   first distinctions with AlloSure   Lung becoming the first donor   
derived cell   free DNA (dd   cfDNA) approved for Medicare coverage for lung transplant
patients, and HeartCare   representing the first transplant molecular testing solution with
two technologies approved for Medicare coverage for heart transplant patients.

Notably, the Medicare approval of HeartCare   in August 2023 reaffirmed our clinical
approach of using two complementary technologies for better patient care. Our goal is to
best serve the clinical needs for managing transplant patients by integrating the most
valuable and informative data. This approach can continue to leverage our rich pipeline of
innovation in the future.

Advanced the adoption of CareDx   s portfolio of innovative solutions by working closely with
researchers to create and share the latest data demonstrating the clinical utility of
molecular diagnostics in immunosuppression management and the potential of AI   
integrated technology.


Progressed our multi   center prospective studies. KOAR, our kidney allograft outcomes
registry, completed the last patient clinical visits, and SHORE, our ongoing surveillance
HeartCare   outcomes registry, reached an interim analysis milestone. Both are likely to see
initial publications in 2024, highlighting evidence that may inform payer coverage policy.

Made progress in advancing our pipeline of innovations, including UroMap  , AlloMap  
Kidney, HistoMap   , and AlloHeme  .

And, repurchased 2.9 million shares of common stock for $27.5 million under our share
buyback program in 2023.
Our impact extends beyond testing services.
An integral part of our success lies in the widespread adoption of our patient and digital
solutions. Over 70% of transplant centers use one or more of our solutions designed to improve
transplant operations, quality improvement, patient management, and health equity. Our
CareDx   Pro platform delivers a single user interface that facilitates access to our portfolio of
digital and testing services solutions, furthering our mission to enhance transplant patient care.
We continue to bring innovation to new transplant laboratories worldwide through our kitted
products utilizing next   generation sequencing (NGS) and qPCR technologies. Our market
leadership in NGS HLA typing through our AlloSeq   Tx line and broad geographical footprint
allows us to benefit from scale leverage as our products business continues to grow.
Looking ahead to 2024 and beyond.
We have confidence in our outlook, encouraged by our momentum as we enter 2024. Our team
is focused on building on the testing services revenue baseline set in the second half of 2023
and expanding access to our innovative portfolio across all three businesses as we continue the
path back to profitability. Our strategic focus remains on financial and operational
performance, while also leveraging our revenue cycle management infrastructure and investing
in multi   center, purpose   driven studies aimed at helping to secure additional reimbursement
coverage.
Long term, we are still in the early stages of a growing $6 billion market opportunity to help
care for some of the highest-need patients in the U.S. healthcare system. Transplant patients in
the U.S. are experiencing incrementally improved short   term outcomes, yet they still face the
challenge of ensuring that their newly transplanted kidney, heart, or lung lasts as long as it
should. Our aim is to change that, and in doing so, we are prepared to tap into a substantial

market opportunity and deliver shareholder value by addressing a critical need in the
healthcare landscape.
CareDx is strategically positioned to capitalize on this growing transplant market opportunity,
as emerging technologies, such as perfusion and xenotransplantation, are primed to
increasingly help address the massive supply   demand imbalance for organ transplants. CareDx
maintains a leadership role in this market, which is characterized by a differentiated financial
phenotype with strong gross margins and a healthy cash position. As a result, we are poised for
continued growth, profitability, and shareholder value enhancement.
Closing thoughts as we embark on the future.
We are humbled by the trust bestowed on us by patients and clinicians. Our dedication to the
mission of delivering innovative solutions to improve patient care remains steadfast, driven by
the significance of our work.
Consider Eddie G., whose life was drastically improved after receiving a new heart. Previously
struggling to reach his mailbox, he now takes long walks and lives life more fully. However, he
must remain vigilant about his heart health, and thanks to our non   invasive testing, early signs
of rejection were detected so his physician could intervene before there was serious heart
damage. Eddie expressed, "It's not an exaggeration to say that early detection from molecular
testing most likely saved my life." The value of our services for patients like Eddie underscores
the ongoing significance of our innovations, emphasizing their important role in enhancing both
pre    and post   transplant patient journeys.
We ended 2023 underscoring our resilience as a company and team. We extend our sincere
appreciation to our dedicated employees, shareholders, and the broader transplant community
for their steadfast support of transplant innovation. Your ongoing trust and confidence in the
value we are creating for transplant patients fuel our relentless pursuit of excellence as we
strive to reach and serve more patients in need.
Sincerely,
John W. Hanna
President and CEO



 4/30/2024 Letter Continued (Full PDF)