GRAIL Q2 2026 Earnings Report

GRAIL EPS Results

• Actual EPS: -$2.56
• Consensus EPS: -$2.66
• Beat/Miss: Beat by +$0.10
• One Year Ago EPS: N/A

GRAIL Revenue Results

• Actual Revenue: $44.69 million
• Expected Revenue: $42.39 million
• Beat/Miss: Beat by +$2.30 million
• YoY Revenue Growth: N/A

GRAIL Announcement Details

• Quarter: Q2 2026
• Date: 8/5/2026
• Time: After Market Closes
• Conference Call Date: Wednesday, August 5, 2026
• Conference Call Time: 4:30PM ET

GRAIL (NASDAQ:GRAL) is a healthcare company focused on developing blood-based tests for the early detection of cancer. Its technology uses genomic and epigenomic signals, including patterns of DNA methylation, to identify signals associated with multiple cancer types from a single blood sample.

The company’s primary product is Galleri, a prescription blood test designed to screen for signals of more than 50 types of cancer, including cancers that currently lack recommended screening methods. Galleri is intended to complement, not replace, guideline-recommended cancer screenings, and a positive result requires follow-up diagnostic testing to determine whether cancer is present and where it may be located.

GRAIL was founded in 2016 as a subsidiary of Illumina and became an independent publicly traded company following its separation from Illumina in 2021. The company is headquartered in Menlo Park, California, and primarily serves the U.S. market. GRAIL has also participated in research and commercial initiatives involving health systems, employers, and international partners to evaluate the use of multi-cancer early detection testing.

GRAIL Q2 2026 Earnings Call Transcript

Key Takeaways

• Galleri sales continued to grow: Second-quarter screening revenue rose 24% year over year to $42.6 million, while test volume increased 35% to more than 61,000. The company added approximately 1,000 ordering providers and said growth is coming from brick-and-mortar physicians, digital health partners, employers, and payer partnerships.
• FDA review remains on track: GRAIL expects an FDA advisory committee meeting in fall 2026 and continues to anticipate potential approval in the first part of 2027. Management said the PMA review is progressing through an iterative process and that it is preparing for the advisory committee.
• Clinical data showed strong detection and safety metrics: Management highlighted false-positive rates below 0.5%, positive predictive values of 50% to 60%, and substantially higher cancer detection when Galleri was added to standard screening. The company also emphasized that roughly 40% to 50% of detected cancers were stage I or II, although the NHS-Galleri trial did not meet its primary endpoint for reducing stage III and IV cancers.
• Samsung financing supports international expansion: GRAIL completed a $110 million strategic investment from Samsung and began planning commercialization in South Korea, with potential expansion to Japan and Singapore. Management said discussions around distribution and longer-term collaboration are just beginning.
• Investment and pricing pressures remain: Adjusted EBITDA loss widened 15% year over year to $90.3 million, while average selling price declined because of greater digital-health volume and lower employer pricing. An Illumina royalty expected to resume toward the end of the fourth quarter will also create a future margin headwind, though management expects minimal Q4 impact.

Presentation

[Operator]

Good day, ladies and gentlemen, and welcome to the GRAIL second quarter 2026 earnings call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. Please be advised that this conference call is being recorded. GRAIL Investor Relations, please begin.

[Company Representative at GRAIL]

Thank you. Thank you all for joining us today. On the call are Josh Ofman, our Chief Executive Officer, Aaron Freidin, Chief Financial Officer, Sir Harpal Kumar, Chief Scientific Officer and President, Global Clinical and Medical Affairs, and Andy Partridge, Chief Growth Officer. I'll remind you that we'll be making forward-looking statements based on current expectations. It's our intent that all statements, other than statements of historical fact, including statements regarding our anticipated financial results and commercial activity, will be covered by the safe harbor provisions for forward-looking statements under federal securities laws.

[Company Representative at GRAIL]

Forward-looking statements are subject to risks and uncertainties. Actual events or results may differ materially from those projected or discussed. All forward-looking statements are based upon currently available information. GRAIL assumes no obligation to update these statements. To better understand the risks and uncertainties that could cause actual results to differ, we refer you to the documents that GRAIL files with the Securities and Exchange Commission, including the Risk Factors section in GRAIL's most recent annual report on Form 10-K and the quarterly report on Form 10-Q. We plan to file for the second quarter of 2026.

[Company Representative at GRAIL]

This call will also include a discussion of GAAP results and certain non-GAAP financial measures, including adjusted gross profit and adjusted EBITDA, which excludes certain specified items. Our non-GAAP financial measures are intended to supplement your understanding of GRAIL's financials. Reconciliations of the non-GAAP measures to most directly comparable GAAP financial measures are available in the press release issued today, which is available on our website. With that, we turn to Josh.

[Josh Ofman, CEO at GRAIL]

Thank you. Good afternoon, everybody. Thanks for joining us to review the results of the second quarter 2026 and discuss recent business updates. GRAIL continues to execute across our clinical and commercial priorities. We launched the Galleri test in 2021 after our approximate 6,000 participant Interventional PATHFINDER study, which was conducted under an FDA-approved investigational device exemption and read out and demonstrated strong performance and safety in a screening population.

[Josh Ofman, CEO at GRAIL]

For several years, PATHFINDER was the only interventional study that clearly demonstrated the benefits and evaluated the potential harms of deploying an MCED test in the intended use population. Since then, we've read out two additional large studies. Our 35,000 participant PATHFINDER 2 study in North America and the groundbreaking 140,000 participant NHS-Galleri trial in England, which included three annual tests.

[Josh Ofman, CEO at GRAIL]

We recently presented detailed performance, safety, and clinical utility results from these studies at the 2026 American Society of Clinical Oncology annual meeting. They are currently under review for publication, further establishing Galleri as the only MCED with extensive clinical validation from interventional studies. These data in the asymptomatic screening population are critical for physicians and patients to understand test performance, as case-controlled studies can fail to replicate performance when tests are rolled out in an intended use population.

[Josh Ofman, CEO at GRAIL]

We're extremely proud of the unparalleled performance demonstrated in these studies in the screening population. We're focused on driving to FDA approval and subsequent Medicare and commercial reimbursement. Galleri test performance is highly differentiated, with a false positive rate of less than 0.5%, resulting in at least three to six times fewer false positives than other MCED tests in development. Our technology at GRAIL was designed specifically for population scale MCED screening.

[Josh Ofman, CEO at GRAIL]

Our extensive research, published in top-tier journals, concluded that methylation holds the highest biological information density, which is why GRAIL's proprietary methylation platform, the largest of its kind, is uniquely capable of delivering high accuracy detection and precise localization. We have published, to our knowledge, the largest head-to-head genomic feature comparison study in the entire field.

[Josh Ofman, CEO at GRAIL]

We showed that combining other approaches considered did not improve performance over our proprietary methylation technology. Adding these other features only introduced additional complexity, cost, and biological noise. The field is increasingly moving to methylation as the technology of choice, further validating our approach. Today in the market with Galleri, we continue to expand access through new and existing partnerships. We are accelerating our international expansion activities.

[Josh Ofman, CEO at GRAIL]

Related to that in the second quarter, we completed the previosly announced $110 million financing with Samsung. Alongside that closing we began work with Samsung C&T Corporation on our strategic collaboration. As a reminder, we and Samsung C&T Corporation will work together to commercialize the Galleri test in South Korea, with the potential to expand into additional Asian markets, including Japan and Singapore.

[Josh Ofman, CEO at GRAIL]

The $110 million investment in GRAIL represents a long-term investment to support our growth and international goals. We were very pleased to complete this financing. We look forward to moving forward with Samsung to introduce our MCED technology to patients throughout Asia. In the U.S. we continue to see growing physician adoption of the Galleri test. We sold over 61,000 Galleri tests in the second quarter, a 35% increase in volume year-over-year.

[Josh Ofman, CEO at GRAIL]

Total Galleri screening revenue was $42.6 million, up 24% over the year prior. For the first half of 2026, we saw Galleri test revenue growth of 30% year-over-year to more than $80 million, and Galleri test volume growth of 42% to more than 117,000 tests. We announced early in 2026 the planned expansion of our field sales and medical teams based on the positive performance and clinical utility results observed in our PATHFINDER 2 and NHS-Galleri trials.

[Josh Ofman, CEO at GRAIL]

This expansion was substantially complete at the end of the second quarter. New personnel have been onboarded and trained and are now in the field. Initial feedback from salesforce engagements with physicians since ASCO has been really positive. Last month, we announced a collaboration with Priority Health to enable its employer groups to add the Galleri test to their existing screening coverage.

[Josh Ofman, CEO at GRAIL]

Priority Health is a nationally recognized non-profit health plan with more than 1.4 million members in Michigan and nearby states. Priority Health launched coverage for Galleri within certain plans in 2025, and our collaboration announced in July marks a promising expansion of this partnership. Moving to our clinical evidence base. We recently shared strong clinical utility performance and safety results from our NHS-Galleri trial and PATHFINDER 2 studies at the recent ASCO annual meeting in May.

[Josh Ofman, CEO at GRAIL]

Although the primary endpoint for the NHS-Galleri trial of a combined reduction of stage III and IV cancers was not met, we believe the other results of this study demonstrated very strong performance, safety, and utility. Across both studies, adding Galleri to standard of care increased the cancer detection rate by 4 to 6.5x. The Galleri test demonstrated very consistent performance, with a false positive rate of less than 0.5% and positive predictive values ranging from 50% to 60%. Galleri also demonstrated high accuracy in predicting cancer signal of origin, enabling efficient and patient-centered diagnostic evaluations.

[Josh Ofman, CEO at GRAIL]

Today, standard of care screening finds only about 14% of cancers in the U.S. and about 6% of cancers in the U.K. By adding Galleri, we estimate that those figures can increase to 50% or more, and indeed in PATHFINDER 2, this number was 60%. This represents a substantial improvement that expands detection of clinically meaningful cancers that otherwise lack recommended screening. Across these two studies, approximately 40%-50% of the Galleri-detected cancers were found at stages I and II, and approximately 70% were found at stages I through III.

[Josh Ofman, CEO at GRAIL]

Remarkably, in the NHS-Galleri study, Galleri detected 366 stage I and II cancers, many more than the 290 cancers detected at any stage by the entirety of the U.K.'s standard of care screening program in the control arm this is truly remarkable. The promise of multi-cancer early detection is not just in finding cancer, but in finding it early enough to open the door to curative treatment options for as many people as possible. What is clear across these groundbreaking trials is that the Galleri test detects a large number of asymptomatic cancers in stages I through III, the majority of which have the opportunity for curative intent treatments.

[Josh Ofman, CEO at GRAIL]

Together, these findings underscore the consistency and actionability of the Galleri test results and demonstrate that adding Galleri to standard of care screening has the potential to improve the effectiveness and efficiency of our current national screening program. This is critical for providers, regulators, and payers as they evaluate the clinical and economic value of Galleri alongside standard of care screening.

[Josh Ofman, CEO at GRAIL]

These data support the potential of MSIA screening at population scale to identify cancers at earlier stages when treatments are more effective and are potentially curative. Turning now to our regulatory process. We submitted our pre-market approval application to the FDA in early 2026, and we remain in an ongoing iterative review process. We are very confident in the data package that's been submitted. Galleri's performance has been validated and replicated in multiple rigorous intended use population-level studies.

[Josh Ofman, CEO at GRAIL]

We have consistently shown that Galleri can detect asymptomatic cancers well over and above the standard of care. The evidence clearly demonstrates that Galleri can be useful and safe when implemented at scale. Our PMA for Galleri is focused on test performance and safety results from the first approximately 25,000 participants in the PATHFINDER 2 study with one year of follow-up, and the prevalent screening round for the first year of the NHS-Galleri trial.

[Josh Ofman, CEO at GRAIL]

The submission also includes a bridging analysis to compare performance of the version of Galleri used in these clinical studies to the updated version that has been submitted to the FDA for pre-market approval. As Galleri is a first of its kind technology and multi-cancer early detection represents a potential paradigm shift in cancer screening, we do expect the FDA to convene an advisory committee for Galleri in the fall. The FDA will announce specific timing of an advisory committee. Turning now to the evolving market environment. As additional MCED tests have launched, a few things are very critical to mention.

[Josh Ofman, CEO at GRAIL]

Other MCED products have been introduced based only on observational case-controlled data and have yet to evaluate the benefits and harms in an actual screening population. First, that means it is unknown how the purported benefits of these tests shown in case control data will translate, if at all, into performance when deployed into an asymptomatic screening population. Without interventional studies, it's not clear whether the diagnostic pathways and procedures have been developed to support physicians and patients after a positive test.

[Josh Ofman, CEO at GRAIL]

Second, MCED tests with high false positive rates may expose patients to significant risks of radiation exposure and invasive diagnostic tests, which carry potential for complications and increased morbidity. Until these tests have been robustly studied and validated in the intended use screening population, they represent an unknown benefit-risk profile and should be considered experimental screening tests at this stage.

[Josh Ofman, CEO at GRAIL]

When we launched Galleri, we deliberately chose to do so only after reporting results from a prospective interventional study under an FDA-approved investigational device exemption in the screening population. We believe that patients deserve and the field demands this level of robust evidence because the true litmus test of test performance, both benefits and harms, is demonstration in interventional clinical studies in the actual intended use population.

[Josh Ofman, CEO at GRAIL]

Now, why do I say this? This is because case control data will not always replicate in interventional studies. For example, after very strong performance for the CancerSEEK assay was observed in a case-controlled study published in a top-tier journal, Science, the DETECT-A study failed to replicate performance and safety in an interventional study. As you know, this test is currently not available or on the market. Beyond study rigor, Galleri test characteristics stand apart in the field.

[Josh Ofman, CEO at GRAIL]

Based on data from observational studies that are case-controlled, experimental MCED tests are operating at a three to five times higher false positive rate. They detect a smaller number of cancer types and some have no ability to predict a cancer signal origin, which we believe is necessary for safety and performance of any MCED test. In a field where hope and hype can easily collide, GRAIL is defined by rigorous science and validated by the most extensive evidence base.

[Josh Ofman, CEO at GRAIL]

We believe we chose the right biological signature of cancer after unbiased comparisons. We have built the most advanced proprietary technology to interpret that signal, and we have proved its performance in the real world on an unprecedented scale. I'll now hand off to Aaron for a review of our second quarter financials.

[Aaron Freidin, CFO at GRAIL]

Thanks, Josh, good afternoon, everyone. Second quarter results were strong with revenue of $44.7 million, up $9.1 million or 26% as compared to the second quarter of 2025. Total revenue for the second quarter consisted of $42.6 million of screening revenue and $2 million of development services revenue. Screening revenue was up 24% as compared with the second quarter 2025, with test volumes of more than 61,000, an increase of 35% over the second quarter of 2025. Net loss for the quarter was $110.2 million, a decrease of 3% as compared to the second quarter of 2025.

[Aaron Freidin, CFO at GRAIL]

Non-GAAP adjusted gross profit for the second quarter was $21.6 million, an increase of $5.4 million or 34% as compared with the second quarter of 2025. Primary drivers of the increased gross margin were improved fixed cost leverage from higher volumes, a decrease in sample reprocessing costs, partially offset by a decrease in ASP. Adjusted EBITDA for the second quarter was negative $90.3 million, an increase in adjusted EBITDA loss of $11.9 million or 15% as compared to the second quarter of 2025.

[Aaron Freidin, CFO at GRAIL]

We ended the second quarter with a cash position of $861.6 million, which includes the $110 million strategic investment by Samsung, which closed in June. Our cash balance today provides us with financial flexibility as we advance key priorities, including securing regulatory approval and reimbursement for Galleri in the U.S. Back to you, Josh.

[Josh Ofman, CEO at GRAIL]

Thank you, Aaron. We're really pleased with the continued growth for Galleri and the progress we're making towards FDA approval and broad-based access. We anticipate continued progress over the next year. With ASCO behind us, our expanded field teams are now fully equipped to educate clinicians about our groundbreaking trial results and continue market development. Initial feedback from the field has been really positive. We look forward to potential FDA approval of Galleri, expanding distributor partnerships internationally, progressing R&D on Galleri improvements and cost of goods reduction, publication of the NHS-Galleri and PATHFINDER 2 studies, as well as additional analyses from our extensive clinical program. Operator, we can now go to Q&A.

[Operator]

Thank you. At this time, if you would like to ask a question, please click on the raise hand button, which can be found on the black bar at the bottom of your screen. You may remove yourself from the queue at any time by lowering your hand. When it is your turn, you will hear your name called and receive a prompt to unmute. As a reminder, we are allowing analysts one question and one related follow-up today. We'll wait one moment to allow the queue to form. Our first question will come from Subbu Nambi with Guggenheim. Please unmute your line and ask your question.

[Subbu Nambi, Analyst at Guggenheim]

Hey, team. Thank you for taking my question. As you anticipate an FDA AdCom in the fall, where do you think the FDA will focus on? What type of questions, how are you preparing for those questions?

[Josh Ofman, CEO at GRAIL]

Hi, Subbu. Thank you for the question. We are obviously getting ready and preparing internally. We don't know the nature of any of that information at this time, we should obviously, we'll be informed about that as the time approaches. We're waiting to hear something from the FDA as it relates to timing.

[Subbu Nambi, Analyst at Guggenheim]

Okay. That's helpful. Given all the leadership changes at the FDA and the delays we have seen recently when it comes to finding the right panelist for AdComs, is there a risk this meeting pushes into next year at all? I know it's an unfair question.

[Josh Ofman, CEO at GRAIL]

Well, it's fine. We don't know the answer to that question. We know that the division that we're working with has been fairly stable at the FDA, which has been very positive and productive, and we continue our iterative review with them. I couldn't really comment on their ability to find experts.

[Subbu Nambi, Analyst at Guggenheim]

Okay, can I squeeze one more, though? Would you expect CMS to wait for an FDA approval before better defining the NCD criteria for an MCED test?

[Josh Ofman, CEO at GRAIL]

It's a good question. I'd be speculating if I tried to answer it we do know that CMS's coverage authority is only for FDA-approved products. Our assumption has been that they would only undertake a national coverage analysis upon an FDA approval. Whether they're going to set specific coverage criteria is unknown.

[Subbu Nambi, Analyst at Guggenheim]

Fair. Thank you so much, guys.

[Operator]

Our next question will come from Kyle Mikson with Canaccord Genuity. Please unmute your line and ask your question.

[Kyle Mikson, Analyst at Canaccord Genuity]

Hey, guys. Thanks for the questions. Congrats on a strong quarter. Following up on Subbu's questions about FDA. Maybe Josh, it wasn't clear to me what the specific communication with the FDA was for you to now anticipate the meeting AdCom to be in the fall. If you could talk about that'd be helpful. Additionally, in the past, you've talked about an early 2027 sort of approval timeline. Let's say this is mid-fall or something. How would that affect your new timeline for FDA approval? Thank you.

[Josh Ofman, CEO at GRAIL]

Thanks for the question, Kyle. We have long stated publicly that we would anticipate that a groundbreaking technology like an MCED test, like Galleri, that is really changing the potential cancer screening paradigm would get an advisory panel, and we continue to believe that. There's no specific information that's been made public yet from the FDA about that, but we certainly are anticipating that an AdCom would occur. The timing of it has not been made public yet, so that's still to come, and our current anticipation for potential approval as it relates to timing remains unchanged. We would expect it to occur in the first part of 2027.

[Kyle Mikson, Analyst at Canaccord Genuity]

Perfect. Thanks for that. On competition, you called that out. That's interesting. It doesn't seem like there's been a volume impact, but how is that impacting your pricing? It looks like ASP in the quarter was $700 or something around there. On that note, I think USPSTF is meeting later this month. Could they possibly talk about MCED at that meeting? How do you think that progresses given it's more noise in the marketplace with some of these other entrants recently?

[Josh Ofman, CEO at GRAIL]

It's a fair question. Let me take your second question, and then I'll have Andy address your first. As it relates to the USPSTF, I think there's just a lot that's unknown right now about the USPSTF. It's unknown what its composition is going to be, what its focus will be, and I think before there's an FDA-approved product on the market, it's, in my mind, less likely that they're going to take MCEDs up irrespective of the amount of noise that's in the market or not. There's just a lot of unknown about the USPSTF, and it's mandated at this time. Your first question, which was about the impact of competition on our pricing, I'm going to let Andy discuss that.

[Andy Partridge, Chief Growth Officer at GRAIL]

First of all, the ASP decrease in second quarter 2026 was the result of both expansion of digital health volume, and also lower employer pricing, which was planned. That reduced employer pricing has come along with the benefit of strengthened partnerships with those employers, such as specific marketing commitments and blood draw events. In terms of competition, there's definitely been some active competition that we've seen that has been stepped up, as I'm sure you've also seen. It has been causing some customer confusion in the market, given, as Josh outlined earlier, these what we would call experimental MCEDs, do not have your data in the screening population.

[Andy Partridge, Chief Growth Officer at GRAIL]

Many of their performance characteristics are unknown to those prescribing physicians they also have higher false positive rates. What we're seeing with physicians that have experimented with some of these MCEDs is quite a bit of confusion due to these higher false positive rates and unclear performance characteristics. That's something that our sales team are following up with those customers to reinforce Galleri's extensive clinical program that we've conducted and the clinical results that we've presented and published. As Josh said, the initial reactions from these conversations where we followed up with our customers with the data that was presented at ASCO for both PATHFINDER 2 and NHS-Galleri has been very promising and very favorably received.

[Josh Ofman, CEO at GRAIL]

I think that's great, Andy. I would just add one other thing. The noise that's been interjected into the market, our anticipation is that we will have an FDA approval, and that will create a bifurcation in the market and clear up a lot of that noise. We expect the market really to evolve one side with Galleri as a well-validated and potentially FDA-approved MCED, and then the other side of the market with the other MCEDs that are still, quite frankly, in development with unknown risk-benefit profiles in the intended use population. They'd be considered very experimental. We see that bifurcation coming, and we look forward to executing upon it.

[Operator]

Our next question will come from Bradley Bowers with Mizuho. Please unmute your line and ask your question.

[Bradley Bowers, Analyst at Mizuho]

Hey there. Thank you for taking my questions. Maybe just wanted to click on the sales force expansion, obviously a pull forward of some of the costs. Just wanted to hear about why the timing is right. Seemingly, the first part of 2027 timeline seems coincident with expected productivity ramp. Also just wanted to hear about if you knew about the AdCom scenario from the FDA, when you allocated this size, and if this is the max sales force you expect.

[Andy Partridge, Chief Growth Officer at GRAIL]

Yeah. We pulled forward the sales force expansion really on the back of the NHS-Galleri and PATHFINDER 2 data that we announced earlier in the year, given how excited we were with both sets of that data. That sales force expansion is essentially complete now. Those sales members are now in the field. We expect to see the true benefit of that additional sales force horsepower as we go through the rest of the year. The other reason that we did this is to have those new salespeople in territory, all trained, so that they can truly meet the moment of FDA approval, as Josh outlined, as this is going to be a landmark event for GRAIL, really establishing Galleri as the gold standard MCED.

[Bradley Bowers, Analyst at Mizuho]

Got it. Just real quick, would you give a number just because of competitors, we do know a lot of them. Just actually totally switching gears. On the panel, do you think this would make it maybe easier or harder for the incremental MCED test? Asking just because the government initiative right now seems to be just trying to ease the pathway towards getting MCED tests, adding more to the market. Obviously the panel would be differentiated. Wanted to hear if you think it would be a competitive advantage, an extra barrier to entry, or if it might have the adverse effect of making it easier for other MCEDs down the line. Thank you for the questions.

[Josh Ofman, CEO at GRAIL]

Just to clarify, when you say a panel, do you mean an advisory committee panel, or which panel?

[Bradley Bowers, Analyst at Mizuho]

Sorry. The AdCom. I apologize. Yes, this fall, the meeting this fall.

[Josh Ofman, CEO at GRAIL]

No, an AdCom. Look, the reason we expect an AdCom is because typically when the FDA reviews a kind of groundbreaking pioneering type of technology, particularly one that can have this kind of impact on public health that is really paradigm changing, they typically hold an AdCom because they want to get advice from other experts. The AdCom will be completely about Galleri. It will not be about the field of MCEDs, it won't be about other MCEDs. It'll be just about our data package that we have submitted to the FDA.

[Josh Ofman, CEO at GRAIL]

We don't really view it as a competitive advantage or disadvantage. We view it as part of the FDA approval process for a groundbreaking technology like Galleri. To your further question, I don't think that that has necessarily any bearing on whether there will be AdComs for future MCEDs. I don't see any MCEDs right now, even on the horizon, doing registrational trials or anything like that. It's really hard to say.

[Andy Partridge, Chief Growth Officer at GRAIL]

I think just building on Josh's point, what the AdCom and the FDA approval is going to do is establish that approval bar for future MCEDs. That's why we're excited for this panel and for the anticipated FDA approval, that it is going to set that bar for future MCEDs coming forward.

[Operator]

Our next question will come from Dan Brennan from TD Cowen. Please unmute your line and ask your question.

[Dan Brennan, Analyst at TD Cowen]

Great, thanks. Congrats on the quarter. Thanks for the questions. Maybe just one more on the panel, since it's obviously the topic du jour. Josh, you sounded pretty definitive that there'll be a panel. The FDA will alert us when the time is right. Can you just share any color? Does that mean like an outright decision popping up one day is off the table? Just what's the level of the discussions that you have with FDA under these types of processes, and just anything you could share on that front would be helpful.

[Josh Ofman, CEO at GRAIL]

Yeah. There's not a lot we can share until the FDA decides to make a public pronouncement one way or the other. From the very outset, we have been anticipating an Ad Com. We've stated that numerous times. We don't see any reason why that wouldn't be the case. Really it's just our own internal preparation at this point until the FDA decides to make a public pronouncement. We're prepared for one. We continue to prepare. We feel very confident about the evidence package that we've submitted to the FDA. We've been in a very productive, iterative review process, and going through all the relevant steps of inspections and other things that you would expect, going into a PMA. Things are progressing well and we look forward to hearing more from the FDA.

[Dan Brennan, Analyst at TD Cowen]

Great. Thank you. Is there anything you can share about the back and forth, like in terms of, obviously you can't get into specifics, but I'm sure there's a certain cadence to questions and responses all, but I'm not sure how you might categorize those if there's anything you could share on that front.

[Josh Ofman, CEO at GRAIL]

Not really. It's pretty typical. There have been a series of questions. We've responded. There have been a series of inspections. We've performed through those. It's just a very standard process. Not much I can really share.

[Dan Brennan, Analyst at TD Cowen]

Okay. How about the marketing since ASCO? I know that you guys were kind of held back a bit from being out in the field since the NHS-Galleri headline was out, but you wanted to wait until you presented the full data set at ASCO. Now that that was out, can you just share any color about what the plan has been in the last six weeks or so, or eight weeks, excuse me. What have you guys done? How many customers have you hit? What's been the response? Anything on that front to kind of provide color on?

[Andy Partridge, Chief Growth Officer at GRAIL]

Yeah. We trained all of the sales force the week after the ASCO meeting we plan to do that. We also trained all of our new sales force that we brought on board in terms of the sales force expansion. Our sales teams have been out there talking to customers, both healthcare providers and to employer customers. The reaction has been very favorable from customers as we've explained to them both the PATHFINDER 2 data and the NHS-Galleri data, really establishing that Galleri is the only MCED proven to reduce stage IV diagnoses. Physicians have reacted very favorably to that. Really, this has been the promise of Galleri all along, to increase early-stage detection and reduce late-stage detection, enabling more patients to receive curative intent therapy. Yeah, everything very promising up until this point.

[Josh Ofman, CEO at GRAIL]

Yeah, I was in the field recently as well, speaking with clinicians and practicing providers. When they hear the results of the study, like Galleri found more early stage I and II cancers in the NHS trial than the entire number of cancers found by the U.K.'s national screening program, it's pretty remarkable. I think it has quite an impact. We also found that there was a dramatic increase in the stage I and II screen-detected cancers in the Galleri arm compared to the control arm in NHS-Galleri.

[Josh Ofman, CEO at GRAIL]

Of course, there was a six and a half fold increase in the overall cancer detection rate in PATHFINDER 2 when added to standard of care. When you talk to doctors about those kinds of numbers, you get a very positive reaction. Andy's point is, I want to underscore it, the whole purpose of screening for cancer is to give individuals an opportunity to find cancer in stages that have curative intent opportunities. In PATHFINDER 2, for example, the vast majority of Galleri-detected cancers received curative intent treatment.

[Dan Brennan, Analyst at TD Cowen]

Great. Maybe just I'll sneak two more in. Publication, just latest thoughts there, timing, when we might expect the data to be in a leading journal.

[Josh Ofman, CEO at GRAIL]

Harpal?

[Harpal Kumar, Chief Scientific Officer and President, Global Clinical and Medical Affairs at GRAIL]

Yeah. Harpal here. Thanks, Dan. We have submitted publications both on PATHFINDER 2 and NHS-Galleri. Those have been in active review at top-tier journals, and those review processes are going well and they're going quickly. We are hopeful of publication in the near future.

[Dan Brennan, Analyst at TD Cowen]

Great. Assuming FDA approval comes at some point this fall, early next year, obviously Medicare will have to follow the decision there. In the interim, what type of impact will FDA approval, do you think, have upon either could some payers adopt then? Will maybe self-insured plans look to do anything, volumes? Just what's the meaning of FDA approval, do you think, on the business, say, in that 12-month period between that decision and when the Medicare decision comes?

[Andy Partridge, Chief Growth Officer at GRAIL]

Thanks for the question. FDA approval is really the gate that a lot of payers have been waiting for to really dig into Galleri in serious conversations. We're looking forward to that. Also, many employers have told us that they're waiting for FDA approval as well, that's going to put a wind at our backs with both employers and with payers going forward. Of course, healthcare providers. Josh and I have talked about the confusion that's being caused by experimental MCEDs promoting their unproven tests. FDA approval is going to give providers the confidence that Galleri is the gold standard MCED. We feel that that's also going to give our sales teams a lot of confidence going forward in terms of their sales efforts to provider clinics.

[Dan Brennan, Analyst at TD Cowen]

Terrific. Thank you all.

[Operator]

Our next question will come from David Westenberg from Piper Sandler. Please unmute your line and ask a question.

[Karan Patel, Analyst at Piper Sandler]

Hey, guys, it's Karan Patel on for David Westenberg, I'll maybe shift gears here. If you could speak to the Illumina royalty resuming sometime in Q4, how could we think about margins for Q4 and then specifically for full year 2027?

[Aaron Freidin, CFO at GRAIL]

Karan. That royalty will kick in toward the end of Q4. It's not going to have an impact on Q4 in any meaningful way. We've been disclosing what that royalty would be every quarter so far in the financials. You can see what that would have been if we had been paying it. We've disclosed in the financials it's 7%-9%, 7% royalty, I believe. You can do your modeling to see what the impact would be based off of the volumes that you're expecting in the ASPs.

[Karan Patel, Analyst at Piper Sandler]

Understood. Thank you. Minimal for Q. Got it.

[Josh Ofman, CEO at GRAIL]

Yep.

[Operator]

Our next question will come from Kallum Titchmarsh from Morgan Stanley. Please unmute your line and ask your question.

[Kallum Titchmarsh, Analyst at Morgan Stanley]

Great. Thanks for taking the question, guys. Sorry again to move back to the AdCom. I was just reading through the transcript from the Q4 call back in February, the message did seem to be that you were prepping for an AdCom, but one likely wasn't necessary. I'm still just trying to unpackage what perhaps has changed maybe from the questions that you've had from the FDA to the tone that you've given today. I realize you can't perhaps go into too many of the specifics, but just some guidance would be helpful.

[Josh Ofman, CEO at GRAIL]

Sure. No, it's a fair. There's nothing that's changed in our minds or in our point of view about the FDA AdCom. I'm not sure what you're reading into prior comments. We've been very consistent saying that we are expecting that there will be an AdCom, and we still expect that, and we're fully prepared for that. In fact, we look forward to the opportunity to really discuss this data package, which is unprecedented in performance and scale, with the AdCom.

[Kallum Titchmarsh, Analyst at Morgan Stanley]

Okay, fair enough. Then some pretty sizable financing completed with Samsung in the quarter. Can you maybe just speak to the level of engagement there and how we should be thinking about the regulatory and commercial timelines in South Korea, Japan, and Singapore? Thank you.

[Aaron Freidin, CFO at GRAIL]

Yeah. It's Aaron again. We closed that toward the end of the quarter, and we're just kicking off those discussions now around distribution in the near term and then any sort of longer-term strategic engagement. As you recall, we were under CFIUS review during that period, and we weren't engaging with each other as such. We'll be able to provide more color on that as we move through the year.

[Operator]

Our last question will come from Robert Bamberger with Baird. Please unmute your line and ask your question.

[Analyst at Baird]

Hi, guys. This is Josh on for Robbie. Thanks for taking my question. I guess first, another solid quarter for Galleri here. What was the primary growth driver in the quarter? Was this more on new physician adds or improving order rates among existing physicians? Thanks.

[Andy Partridge, Chief Growth Officer at GRAIL]

Thanks. Self-pay remains the majority of Galleri's volume, accounting for about 70% of sales. We see that most of the volume's coming from brick-and-mortar physicians, and we added, again, about 1,000 new ordering providers in Q2. Depth of prescribing continues to increase over time electronic order integrations with Quest Diagnostics and athenahealth are also both bringing on new prescribers themselves and helping increase the depth of prescribing as well, given we don't just want to have the best-performing test and the gold standard MCED. We also want to have the easiest test for prescribers to prescribe to their patients.

[Andy Partridge, Chief Growth Officer at GRAIL]

We also continue to see very strong growth in our digital health business from both new and existing digital health partners. We're seeing continued expansion in employers that are offering the test and also expansion in some new digital health partners. Also as we announced expansion in our payer partnerships with Priority Health now joining a number of other ASO payers who have decided to offer the Galleri test to their employer base of customers.

[Analyst at Baird]

Great. Was just wondering too with the NHS, have discussions here gone around expanded Galleri studies or future collaborations? Do you have any concerns around the ongoing NHS reform? How is that impacting Galleri and diagnostic aid for cancer conversations? Thanks.

[Harpal Kumar, Chief Scientific Officer and President, Global Clinical and Medical Affairs at GRAIL]

Yeah. Thank you for the question, Josh. Look, there's no getting around the fact that the fundamental changes in the sort of organizational structure and governance for NHS services in the U.K. is causing some hiatus in decision-making and what those future structures will look like, and there's still an enormous amount of uncertainty around that. And quite a lot of organizational upheaval that's flowing from that.

[Harpal Kumar, Chief Scientific Officer and President, Global Clinical and Medical Affairs at GRAIL]

What I will say is that as we have talked to the leading clinicians in the NHS and indeed clinicians more generally in the U.K., the overwhelming reaction is one of positivity about the results. Really, as Andy has described for the U.S., we're seeing a great deal of enthusiasm around the stage IV reduction and some of the other metrics that we've talked about, but particularly the stage IV reduction and the opportunity that promises to really transform cancer outcomes. Look, as we get through this, as I say, this organizational upheaval with the NHS, I anticipate those conversations will translate into defining hopefully a meaningful way forward.

[Operator]

Thank you. There are no further questions at this time. Ladies and gentlemen, this concludes the call.

Participants

Executives

• Company Representative
• Josh Ofman, CEO
• Aaron Freidin, CFO
• Andy Partridge, Chief Growth Officer
• Harpal Kumar, Chief Scientific Officer and President, Global Clinical and Medical Affairs

Analysts

• Subbu Nambi, Analyst at Guggenheim
• Kyle Mikson, Analyst at Canaccord Genuity
• Bradley Bowers, Analyst at Mizuho
• Dan Brennan, Analyst at TD Cowen
• Karan Patel, Analyst at Piper Sandler
• Kallum Titchmarsh, Analyst at Morgan Stanley
• Analyst at Baird