Operator: Good day and thank you for standing by. Welcome to the Third Quarter of 2021 Genetron Health Earnings Conference Call. At this time, all participants are in listen-only mode. And after the speakers presentation, there'll be a question and answer session. [Operator Instructions].

And please be advised that today's conference is being recorded. [Operator Instructions]. I would now like to turn the conference over to your first speaker for today, Ms. Hoki Luk. Thank you.

Please go ahead.

Hoki Luk: Hello, everyone, and welcome to Genetron Health third quarter 2021 earnings conference Call. The company's earnings release was issued earlier today and is available on the company's IR website. During this call, the company will be making some forward-looking statements regarding future events and results. These statements are made under the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995.

Statements are not historical facts, including statements about Genetron Health's beliefs and expectations are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. Further information regarding these and other risks is included in Genetron Health's filings with the SEC. All information provided today is as of the date of this call. And Genetron Health does not undertake any obligation to update any forward-looking statements except as required under applicable law.

With respect to any non-IFRS measures discussed during today's call, the company's reconciliation information related to these measures can be found in the earnings release issued earlier today. Allow me to introduce the management team on the call today. Mr. Sizhen Wang, our Co-Founder and CEO of Genetron, will discuss recent business updates and upcoming catalysts. Our Chief Medical Officer, Mr.

Yun-Fu Hu, will discuss our early screening program. Evan Xu, our CFO, will provide financial highlights related to the unaudited third quarter results outlined in today's release, as well as the outlook for 2021. Following management's prepared remarks, we'll open up the call to questions. During the Q&A session, our Co-Founder and Chief Scientific Officer, Dr. Hai Yan, and our Chief Technology Officer, Dr.

Yuchen Jiao will also be available to answer questions. With that said, I would now like to turn the call over to Mr. Sizhen Wang, the CEO of Genetron Health. Sizhen, please go ahead.

Sizhen Wang: Thank you, Hoki.

Good morning and good evening, everyone. Thank you for joining our third quarter 2021 earnings conference call. I would like to direct you to the supplemental earnings presentation on our Investor Relations website and begin on slide 2. In the third quarter, we continued to expand our foundation as the foremost provider of precision oncology tools, tests, and services in China. Our comprehensive portfolio covers the entire spectrum of cancer management, enabling our customers to address patient needs and challenges from early screening, diagnosis monitoring, as well as treatment recommendations.

Turning to slide 4. In spite of the COVID impact on our business in the third quarter, we delivered strong results with 36.2% top line year-over-year growth on revenue of RMB 152.5 million. Our IVD business grew over 70%, thanks to the continued uptake of our S5 instruments at Lung 8 NGS assay. The LDT business also increased over 30%, primarily driven by our liquid biopsy early screening product, HCCscreen. We also saw notable margin improvements with gross margin at 69% compared to 62.2% in the third quarter last year, thanks to improvement in both LDT and IVD business lines.

Operationally, we have achieved significant milestones since the third quarter to further strengthen our precision oncology portfolio. Let me start off with our early screening segment. We're pleased to share with you that we have now initiated a NMPA registrational trial for our early detection assay in HCC. Let me also share our updated strategy on this key pipeline product. After careful considerations, in addition to the multiomics, NGS-based assay, HCCscreen, we have decided that the best approach would be to add a PCR based assay to our registrational strategy.

This structure will allow us to more broadly cover the market and potentially accelerate market penetration with a test. Dr. Hu will present more details on this later on the call. Turning to slide 5. On the MRD side, our efforts have resulted in a very exciting and major achievement recently.

Last night, we have announced a multi-year, co-development agreement with AstraZeneca R&D China for their NGS-based personalized MRD test for solid tumors in China. This is a significant milestone for Genetron as the collaboration highlights the value of the MRD solid tumor data generated by our proprietary Mutation Capsule platform. More importantly, with AZ support, we expect the partnership to further accelerate development timeline for this assay. With this partnership, the companies will jointly invest capital and will work together to develop and validate these assays for cancer monitoring and recurrence in China. A joint committee will also be established to oversee the product development.

In addition, for solid tumor clinical trials in China that incorporates the use of NGS-based personalized MRD tests, AZ plans to use this co-developed MRD test for all China-specific trials. The companies may also expand the partnership later to include IVD registration and commercialization. Overall, this agreement represents the first step of a long-term exclusive collaboration, and the partners' goal is to develop a word class tumor-informed MRD product. We are optimistic about MRD solid tumor market in China, and in particular, Genetron's competitive position after this collaboration. Currently, there are only a handful of companies in China that may have the capability to develop a high-performing MRD assay.

AZ's clinical capability and leading position in oncology will significantly enhance our product development. Also, the use of the co-developed assay in many of their China trials not only will represent revenues for us, but the accumulated clinical experience will be valuable in our product optimization process. Beyond this tumor informed MRD assay, internally we are also exploring a tumor-naïve MRD approach. We look forward to sharing more updates as these programs proceed. In regards to MRD data release, recently analysis of personalized MRD assays developed based on our Mutation Capsule technology has been published in the Journal of Hematology and Oncology, a high impact journal.

The study has shown excellent sensitivity to detect 0.001% tumor DNA in precise prediction of peritoneal dissemination and gastric cancer patients through use of the peritoneal lavage fluid. This is an exciting validation of our technology's ability to detect MRD recurrence in the fluids. As for solid tumor blood-based MRD data, we continue to anticipate publications by the first half of 2022. For Seq-MRD in blood cancer, recently, we announced an exclusive partnership with Fosun Pharma to co-market and co-promote the assay in hematologic-focused hospitals and in clinics across designated regions in China. Fosun has a robust sales force of roughly 1,500 representatives to sell innovative drugs that target hematologic and lymphoid malignancies, solid tumors, and others.

They will be a strong partner for us providing the opportunity to leverage their sizeable sales force and valuable relationships with clinics, hospitals, KOLs, and distributors. Our Seq-MRD assay has been optimized with our proprietary One-Step Seq technology, which enables the DNA library construction process for gene sequencing to finish with a single PCR reaction. This simple operational feature, together with our fully automated bioinformatics solutions enable Seq-MRD to achieve high throughput and accuracy, good uniformity, high cost efficiency, and fast turnaround times when compared with traditional detection methods. To date, Seq-MRD has been tested with thousands of samples of ALL, MM, and CLL in China. The recently NMPA Center for Drug Evaluation issued guidelines for MRD testing in multiple melanoma clinical trials.

We're pleased with continued support of MRD testing in blood cancers in China, and believe our NGS-based Seq-MRD represents an innovative and competitive option in the market. Turning to slide 6. Moving on to discuss our biopharma service business. In third quarter, we have signed an additional seven biopharma partners, increasing the total now to 47 partners. We continue to see a strong pipeline as we have the opportunity to form partnerships throughout key products, including Seq-MRD, Onco PanScan, FusionScan, and others.

In China, the trend of CDx demand is becoming stronger resulting from NMPA's increasing focus on genomic testing for innovative targeted immunotherapies. In the US, our CLIA lab in Maryland is up and running providing us with a solid platform to offer services for cross border trials and CDx development. With a booming Chinese biotech sector, we are optimistic about our growth in this business segment. And recently, we announced a strategic partnership with NeoGenomics to drive global oncology drug research and development. As outlined in this agreement, the partners will provide select harmonized clinical trials, global translational research for pharmaceutical groups and technology platform providers that need a China arm for global or China-focused trials.

Additionally, NeoGenomics will support our trials in the US, APJ, and the EMEA regions. Combined, the two partners have 15 CAP accredit and CLIA-certified laboratories, a collective team of hundreds of scientists and seasoned clinical drug trial and pharmaceutical service team. These assets will enable business partners to synchronize global clinical drug trials and companion diagnostic development. Lastly, on slide 7, we have achieved a major milestone in November with the receipt of CE Mark for our tissue-based large panel Onco PanScan mutation detection kit. In China, we have completed the typing test for our registrational trial and we plan to initiate enrollment in the first quarter of 2022.

I will now turn the call to Dr. Hu to provide more color on our HCC early screening registrational trial details and strategy. Yun-Fu?
Yun-Fu Hu : Thank you, Sizhen. Let's go to slide 8. As Sizhen mentioned earlier, we have advanced our early detection liver cancer program with two assays.

In addition to the multiomics NGS-based assay, HCCscreen, that we have discussed in the past, we're introducing a methylation multi-marker PCR-based assay named HCCscan. First, let's discuss HCCscan. A couple of major policy developments emerging in last year which led us to decide that PCR-based assay to the program would be a wise approach. The first development was government infrastructure build and spending. In China, PCR has a more established presence and readily available workflows in many hospitals and clinics.

After the COVID-19 outbreak, the State Council has required hospitals at the county level and above to establish capability for nucleic acid testing, which further accelerated the PCR in hospital testing market. The second development was related to government insurance coverage. A few months ago, DNA methylation and genetic testing was included in some of Beijing and other provisional insurance programs, establishing a benchmark pricing of around RMB 800 for methylation-based tests and around RMB 1,500 for [indiscernible] NGS-based testing. Based on this development, our company is just adding a high performing PCR-based assay that would potentially expand the coverage of the product. In addition, on the self-pay population, China has a unique fragmented market where affordability could vary significantly across the country.

Offering a PCR product can also provide self-pay selfie patients in lower tier market with a cost optimal solution. As such, we have selected nine clinical sites and have just started our patient enrollment in a registrational trial for HCCscan. In this trial, we are evaluating HCCscan alone versus HCCscan plus ultrasound versus the standard of care, which is ultrasound plus AFP, with a target of 5,000 patients, a similar cohort size as HCCscreen. The trial is expected to complete by the end of 2022. As far as HCCscreen NGS-based trial, we continue to be committed to this trial and have further progressed with our preparation work.

We have selected our assay platform and have completed optimization and locked down our algorithm of HCCscreen. In addition, with the ongoing PCR trial to be taking place at nine sites, we plan to select and narrow down to four to five of these sites that we believe are more suitable and efficient to run our NGS study. The design of the NGS trial remains unchanged, which will be head to head trial of 5,000 patients comparing HCCscreen versus ultrasound plus AFP. We expect patient enrollment to start in the next few months and for the trial to be complete by the end of 2022, as we discussed in the past. Overall, with a broad strategy to offer HCCscan and HCCscreen, we are confident that we can deploy both new hospital and central lab models to increase accessibility and penetrate the market more efficiently.

We have communicated our trial design plans with NMPA and continued to project potential NMPA approval for both HCCscan and HCCscreen in 2023. As for early screening in other cancer types, we have gathered preliminary case control CRC data. Moving to slide number 9. Based on Mutation Capsule technology, we have developed a blood-based profiling assay, profiling multiomics biomarkers including methylation, detection and copy number variations from cFDNA. The algorithm was trained a retrospective cohort of 100 cases and 100 controls and validated in an independent cohort of similar size.

The assay provided greater than 90% sensitivity with a specificity of 95%. These are encouraging results and we plan to release full details of this cohort through publication sometime in 2020. Finally, as shown on slide 10, I would like to highlight the HCCscreen results were recently published in Chinese Journal of Haematology. This peer-reviewed journal including two articles on HCCscreen. First, expert consensus concluded that HIT study data that we reported in March this year from 1,615 patients showed better screening performance than AFP plus ultrasound and the assay diagnostic value for identify early stage HCC.

The second expert reviewed article suggests that multiomics strategy could offer a higher sensitivity and specificity than AFP for early HCCscreen and monitoring. This journal is a prestigious publication in the liver disease Medical community in China and is viewed as having significant influence on clinical practice among physicians. We're excited that our innovative approach and prospective study results were well received by the leading industry experts. I will now turn the call to our CFO, Mr. Evan Xu, to provide more details on our third quarter financials.

Evan?
Evan Ce Xu : Thank you, Yun-Fu. I will provide an update on our financial performance during the reporting quarter. Please note that all numbers provided are in RMB terms and that all comparisons are made on a year-over-year basis. Starting on slide 12. In the third quarter, total revenue increased by 36.2% to RMB 153 from RMB 112 million in the same period of 2020.

Diagnosis and monitoring revenue increased by 42% to RMB 144 million in the third quarter this year from RMB 102 in the prior year. LDT revenue increased by 30% to RMB 93 million during this quarter from RMB 71 million in the last year. LDT diagnostic tests sold in this quarter totaled approximately 5,900 units, similar to a year ago. In the third quarter, sales of LDT services included sales of our early screening tests. We continue to be pleased with our liver cancer screening sales uptake and the growing adoption in the market, with continued support from our collaborations.

These include the work we are doing with JD Health, [indiscernible]. Moving to slide 13, IVD revenue increased by 71% to RMB 51 million in the third quarter 2021 from RMB 30 million in the prior year. The increase was mainly driven by sales of the sequencer as well as IVD kits. As of the end of the third quarter, we had a total of 54 hospital contracts, including 29 IVD ones. Our pipeline continues to be strong as we signed on several additional IVD contracts since October.

An expanding installation base is expected to drive our reagent and overall sales in the coming quarters. Revenue generated from development services decreased to RMB 8 million in this quarter from RMB 10 million in the prior year. This was mainly driven by the decline in sequencing services as we continue to focus on higher margin biopharma services. Biopharma services revenue in this quarter have continued to grow compared to prior year. Moving to slide 14, cost of revenue increased by 12% to RMB 47 million for this quarter compared to RMB 42 million in the prior year.

Gross profit increased by 51% to RMB 105 million in the third quarter 2021 from RMB 70 million in the per year. Gross margin improved to 69% compared to 62% in the prior year, thanks to higher gross margins for both the LDT and IVD business lines. In particular, gross margin for our LDT segment was 70% in this quarter compared to 69% a year ago. For our IVD segment, gross margin was 76% versus 61% in the prior year, thanks to our One-Step Seq technology and our capability to manufacture the 8-gene lung cancer assay with our own raw material sources, we're able to enjoy healthy margins. Operating expenses increased by 79% to RMB 230 million for this quarter compared to RMB 122 million in the prior year.

Operating expenses are broken out on slide 15 and are as follows. Selling expenses increased by 56% to RMB 95 million in this quarter from RMB 61 million in the same period of 2020. Selling expenses ratio decreased to 62% from 54% in the prior year. The increase was primarily resulted from increasing headcount to expand our core businesses, as well as early screening sales teams. Administrative expenses increased by 94% to RMB 63 million in this quarter from RMB 32 million in the prior year.

Operating expenses ratio increased to 41% in this quarter from 29% in the prior year. The increases were mainly due to more headcount, higher professional fees and IT expenses. Research and development expenses increased by 62% to RMB 62 minutes in this quarter from RMB 39 million in the same period of 2020. R&D expenses ratio increased to 41% in this quarter from 34% in the prior year. The increases were driven by higher R&D headcount and related expenses, as well as continued innovation efforts, including key product development and clinical trial activities.

As a result, operating loss was RMB 125 million for the third quarter compared to RMB 59 million last year on slide 16. Net loss for the period was RMB 130 million compared to RMB 48 million for the third quarter of 2020. We're also providing non-IFRS net loss figures as management believes these figures would be helpful to show the trends of our underlying business. Non-IFRS net loss excludes share-based compensation expenses, fair value change and other loss of financial instruments with preferred rights. Non-IFRS net loss was RMB 110 million for this quarter compared to RMB 44 million for the prior year.

Basic loss per ordinary share was RMB 0.28 for the third quarter of 2021 compared to RMB 0.11 for the same period of 2020. Non-IFRS basic loss per ordinary share was RMB 0.24 for the third quarter of 2021 compared with RMB 0.1 for the same period of 2020. Diluted loss per ordinary share is equivalent to basic loss per share. We have a very strong cash position. Cash and cash equivalents, restricted cash and current financial assets at fair value through profit and loss were close to RMB 1 billion or $156 million as of September 30, 2021.

Now moving to discuss our outlook for 2021. Let's go to slide 17. While we were pleased with the resilience of our business in the third quarter, the COVID situation has worsened since October as the Delta variant continued to take hold in China. Although the absolute total number of COVID cases remains small compared to the other parts of the world, health officials in China continue to maintain a zero COVID policy. More than 20 provinces and regions in China have reported new cases since October.

And the control measures in the forms of lockdowns, mass testing, travel restrictions have been implemented diligently across many places to contain the spread of the virus. In many of our key markets, including Beijing, Shanghai, [indiscernible] and Guangzhou, patient traffic to hospitals has been limited, which significantly impacted our LDT segment since it is highly reliant on patient visits. In Beijing, in anticipation of the Winter Olympics and the National People's Congress in 2022, restrictions have been particularly severe, and this level of high alert is likely to persistent. Moving to slide 18. In the second quarter, we communicated that, if the COVID situation sustained or worsened, we would update our revenue outlook for the year.

At this point, we believe this new COVID wave and the related restrictions to be more persistent than originally anticipated. As such, we are now revising our 2021 expected revenue to be around RMB 530 million, representing approximately 25% of growth compared to 2020. This concludes the discussion of our third quarter financial results. I will now turn the call back to Sizhen.
Sizhen Wang : Thank you, Evan.

In closing, we're very pleased with the success we've achieved both financially and operationally in the face of adversity related to COVID. I would like to emphasize the strong underlying long-term fundamentals of our business. And we remain very well positioned to drive substantial growth through continued commercial, clinical and pipeline development execution. Shown on slide 20 and 21, we remain focused on the development of liquid biopsy based solutions across the full cycle cancer management, particularly in early screening and MRD, while continuing to ramp up our commercialization efforts and grow our base business. Last, but not least, we also continue to see favorable macro environment for our business.

Under China State Councils Healthy China 2030 plan, the goal is to increase five-year cancer survival rate from the current approximately 40% to over 46%. As a leading precision oncology player in China, we expect the rapid emergence of targeted immunotherapies will increase demand for our diagnosis and monitoring business as well as our biopharma services. While early detection, particularly liver cancer, also remains a focus for the government and the companies with differentiated technologies like us are highly encouraged to introduce innovative solutions to address unmet medical needs. Recently, the National Health Commission also issued an oncology diagnosis and treatment quality improvement action plan as its key task from 2021 to 2024. Under this action plan, one of the key initiatives is to improve cancer diagnostic capabilities and standardize the management of medical testing laboratories.

Genetron welcomes these policies that target to raise industry standards. For example, for our Guangzhou lab, we have recently passed a final review of our Onco PanScan as an LDT test by Guandong Center for Clinical Laboratories. Overall, we remain confident about the growth prospects of the precision oncology sector in China and we anticipate Genetron to be a continued beneficiary from the policy tailwinds. This concludes the prepared remarks portion of today's call. Operator, we're now ready for questions.

Operator: [Operator Instructions]. Our first question is from the line of Sung Ji Nam with BTIG. Sung

Ji Nam: Congratulations on all the progress that you're making. So, my first question is on the PCR versus the NGS-based HCCscan versus HCCscreen. Are there any kind of comparisons in terms of performance characteristics at this point? Or is the point of the PCR-based trials to see if the performance characteristics are comparable to the NGS? And what's kind of your expectation there from the performance characteristic standpoint between the [multiple speakers]?

Sizhen Wang: Sung Ji, this is a very important question.

Thanks for raising it. So, obviously, we've done our homework before we decide to go forward with a registrational trial for HCCscan. So, maybe we'll have our CTO, Dr. Yuchen Jiao, to address the performance data question.

Yuchen Jiao: We have validated the PCR-based assay, the HCCscan, in three different cohorts and it shows 85% to 90% sensitivity in this retrospective case control cohort, with a specificity of 90% to 95%.

We do not have the data on the direct comparison of both HCCscan, the PCR assay, and the HCCscreen, the NGS assay, because we get limited DNA from one blood draw and we don't want to split them to the PCR assay and the NGS. Thank you. Sung

Ji Nam: Curious about what are your next steps for the early CRC screening test. I realize you will be publishing the initial data, but curious what are the next steps from a development timeline standpoint?

Sizhen Wang: The question is about the CRC update, right? Yuchen?

Yuchen Jiao: We're planning to submit and try to publish the retrospective cohort data early next year. Meanwhile, we are going to start the prospective cohort validation, which is very important for the early screen assay.

Sizhen Wang: We're, in fact, very encouraged by the retrospective study data we have shown so far. And we believe that with the infrastructure we have built through the retrospective cohort study on HCCscreen as well as the real world cohort we established through the HCCscreen commercialization. We will have a much better infrastructure to launch the prospective cohort study for this new assay, the CRC assay, and we anticipate we will actually complete the prospective cohort study in the next year or so, and we will be able to move this product into potentially a registrational trial. And also, we can start a pilot launch for the assay's commercialization program. Sung

Ji Nam: Lastly for me, just to clarify on the MRD solid tumor partnership with AstraZeneca, does that include – you mentioned that you're also looking at the tumor-naïve approach down the road.

Is the tumor-naïve approach included in this current partnership? And also, if you could talk about which of the cancer indications do you think are kind of maybe on your priority list at this point, given the Chinese market for cancer?

Sizhen Wang: Yes. So, the collaboration with AZ is based on our tumor-informed product, right. And it is a multi-cancer study, but obviously the lung cancer will be the number one goal. And I think joined together with AZ, we will have a very good combination of technical resources and experience to expedite the product development. And in the past research of the gene class conducted, we have accumulated good data on other cancer types as well such as liver cancer and CRC, and as we mentioned in the conference call, we do expect to publish the study's results in the first half of next year 2022.

In terms of tumor-naïve, I think probably Yuchen can share some details here.

Yuchen Jiao: As Sizhen mentioned, we have collected the samples in clinical trials and data in addition to the gastric cancer which has been published. We also have liver cancer, CRC, and some ovarian cancer data. That's based on the personalized assay tumor-informed. But according to the features of our technology, Mutation Capsule, we can test a blood sample for multiple times with different assays.

This means we're testing the tumor-naïve assay, we can test the tumor-naïve assay in all these samples so that we can have the information or the performance of the tumor-naïve universal panel immediately without having to collect new cohorts, collect new clinical information to gather the association. We can compare the tumor-naïve assay with our already very solid personalized method to optimize the algorithm and to check how they can predict the prognosis.

Operator: [Operator Instructions]. Next question is from the line of Yang Huang of Credit Suisse.

Yang Huang: My first question is also about HCCscan.

[indiscernible] like new strategy for your early screening portfolio. So, I want to understand, HCCscan is testing methylation sites. Are those methylation sites also being tested in our HCCscan just using kind of different approach or kind of what is the difference between the two tests besides the approach, one is NGS and one is PCR?

Sizhen Wang: The HCCscan has the methylation sites basically seem – included in the panel of the HCCscreen. So, when we are setting up this qPCR-based assay, we start from the methylation sites in the panel of HCCscreen, which we use to apply for the FDA breakthrough device designation, and we also add a few methylation sites that are not included in that panel because those sites cannot be detected by the method with NGS, but can be detected by our qPCR assay. So, in this case, we have the [indiscernible] panel.

And after the [indiscernible] and setting up the algorithm, we've got a panel of six methylation sites, and most of them are seen from the HCCscreen.

Yang Huang: I see. You are we're trying to accelerate HCCscan because we are targeting nine clinical sites for HCCscan trial, but we are only using four to five clinical sites for HCCscreen. So, similar to HCCscan, will it be a faster trial? So, does that mean kind of our strategy is kind of to shift to focus on PCR first and then the NGS next?

Sizhen Wang: Let me address this question first and then, Yun-Fu, you can feel free to add on more details. So, first, let me let me clarify.

So, we emphasized it in earning calls, we still anticipate to complete both trials, HCCscan and HCCscreen, by end of next year, and we anticipate to get approval from NMPA on both assays. We also mentioned that we will start with nine sites for HCCscan and we will select four to five sites for HCCscreen. The reason that we're limiting numbers of the clinical trial sites for HCCscreen is because we have selected the NGS platform – the NGS assay. It's a lot more preparation work in terms of the instrument installation, in terms of the patient enrollment – essentially, the testing after the patient enrollment for a NGS assay. So, we believe it'll be good to choose the bigger sites or the sites more suitable for NGS operation.

So, all in all, we anticipate that for a long period – or for large portion of next year, we will have these two trials moving forward in parallel. So, again, the value of launching or implementing a PCR-based methylation detection kit for liver cancer screening is we believe that with all the infrastructure that the PCR machine has been installed up to the county level hospital due to the China policy to fight COVID-19 across the nation, we feel that having a methylation or PCR based assay will greatly broaden the coverage of our product offering and will greatly help the speed of the market penetration and when we launch both products. So, the combination of these products will enable Genetron to solidify our leading position in this huge liver cancer early screening market in China.

Yang Huang: My last question is about our kind of number. For LDT – I believe, LDT, we said the number of tests is more or less similar, 3Q compared to last year's 3Q.

As revenue increase, does that mean pricing increase or there's a significant change of mix of the test?

Sizhen Wang: Yang, as you have followed us, our LDT services includes both LDT diagnosis as well as the LDT early screening revenue. As you know, we started to commercialize our early screen liver test primarily this year. So, this is also because, as of first year, the contribution from this is still not significant, right? So, the LDT revenue does include both. And you notice the number of tests, as mentioned in the call earlier, we looked at the COVID outbreak, and especially starting from Q3, since October, the virus spread to over 20 provinces has had a direct hit on the hospitals. That's more correlated to the LDT diagnosis service revenue.

And Q1 and Q2 were relatively okay, but Q3 and Q4, we are seeing a worsening given that the wider region now of our business are now in the COVID region. For early screening, while all in all this year represents a strong growth from last year as we start to work with our collaborators to commercialize. And looking ahead to Q4, we do see that there are some softening given that originally we were hoping that Q4 will be a very strong quarter for us this year, given that, towards the end of the year, the government spending – first of all, it's usually a peak season. Secondly, there are opportunities for government to increase the spending. However, given the current environment, we do see that there are some softening into the early screening business as well entering into Q4.

So, that's how we look at the numbers. And that's why we made an adjustment to the overall outlook for this year.

Operator: [Operator Instructions]. No question as of this moment, and I'd like to hand the conference back to Ms. Hoki Luk for closing remarks.

Hoki Luk: Thank you again for joining us for our third quarter earnings and business update call. We appreciate your ongoing support. If you have any questions, please do not hesitate to reach out to the IR team. Thank you and have a good day.

Operator: Thank you.

and this concludes today's conference call. Thank you for participating. You may now disconnect.