Adaptive Biotechnologies' Strategic EMR Integration and Operational Efficiency: A Path to Profitability in MRD Testing

Adaptive Biotechnologies (ADPT) has emerged as a standout player in the minimal residual disease (MRD) testing market, driven by a dual focus on strategic EMR integration and operational efficiency. In Q2 2025, the company achieved a pivotal milestone: its MRD segment posted positive adjusted EBITDA of $1.9 million, reversing a $21.4 million loss in the same period the prior year. This transformation underscores Adaptive's ability to scale its clonoSEQ platform while maintaining disciplined cost management—a critical combination for sustainable growth in a capital-intensive industry.

Strategic EMR Integration: A Catalyst for Adoption

The integration of clonoSEQ into electronic medical record (EMR) systems has been a cornerstone of Adaptive's growth strategy. By embedding its MRD test into Flatiron Health's OncoEMR platform in July 2025, Adaptive streamlined access for over 4,500 clinicians across 1,000 community-based cancer care locations in the U.S. This integration allows providers to order and review MRD test results directly within their workflow, reducing friction and enabling real-time clinical decisions. The partnership is part of Flatiron's Molecular Profiling Integration (MPI) platform, which has proven effective in accelerating test adoption by simplifying data exchange.

Beyond Flatiron, Adaptive has expanded clonoSEQ's availability through a “rapidly growing number of other EMR integrations” and its online diagnostic portal. While specific partners remain undisclosed, the company reported 154 EMR-integrated sites operational by Q2 2025, including 40 Epic-integrated academic sites. These integrations have driven test volume growth, with mature EPIC sites growing twice as fast as non-integrated business. The company's focus on interoperability ensures that clonoSEQ is accessible across diverse healthcare settings, from academic centers to community oncology practices.

Operational Efficiency: Turning Profitability into a Reality

Adaptive's path to profitability is not just about volume—it's about cost discipline. Total operating expenses for the MRD segment decreased by 7% year-over-year in Q2 2025, excluding prior impairment charges. This reduction, coupled with a 42% revenue increase to $49.9 million, enabled the segment to achieve positive EBITDA. The company's gross margin also improved significantly, with sequencing gross margin rising to 64% (up 14 percentage points YoY) and total gross margin hitting 69%.

Key drivers of this efficiency include:
- Pricing power: The average sales price (ASP) for clonoSEQ tests in the U.S. reached $12.90, a 17% increase YoY, driven by contract renegotiations with major payers.
- Cost optimization: Cash burn for the MRD business dropped 36% to $11 million in Q2 2025 compared to $17 million in Q2 2024.
- Scalable infrastructure: The implementation of Illumina's NovaSeq X Plus for clonoSEQ sequencing has enhanced throughput, supporting higher test volumes without proportionally increasing costs.

Milestone Revenue and Long-Term Guidance

Adaptive's MRD business is not only profitable but also expanding rapidly. In Q2 2025, clonoSEQ test volumes surged 37% YoY to 25,321 tests, with 44% of tests now using blood-based samples (up from 40% in 2024). The company also reported 175 active global clinical trials using clonoSEQ, including $5.5 million in milestone revenue from pharma partnerships.

Looking ahead, Adaptive has raised its full-year 2025 MRD revenue guidance to $190–$200 million, reflecting 31–37% YoY growth. The company also expects to reduce full-year cash burn to $45–$55 million, down from prior guidance of $50–$60 million. These metrics highlight Adaptive's ability to balance growth with financial prudence—a rare combination in the biotech sector.

Investment Thesis: A High-Conviction Play

Adaptive Biotechnologies' success in MRD testing is underpinned by three key factors:
1. Strategic EMR partnerships: By embedding clonoSEQ into EMR systems, Adaptive is creating a durable competitive advantage that accelerates adoption and reduces switching costs for providers.
2. Operational leverage: The company's ability to scale test volumes while improving gross margins and reducing cash burn positions it for long-term profitability.
3. Regulatory and reimbursement tailwinds: The European Medicines Agency's endorsement of MRD testing as a clinical trial endpoint, combined with favorable U.S. reimbursement trends, supports continued demand.

For investors, Adaptive represents a compelling high-conviction opportunity. The company's EBITDA-positive MRD segment, expanding EMR footprint, and disciplined capital allocation make it well-positioned to capitalize on the $1.5 billion MRD testing market. With a cash balance of $222 million and a $218 million backlog, Adaptive has the financial flexibility to fund growth without dilution—a critical consideration in an industry where capital constraints often derail promising companies.

Conclusion

Adaptive Biotechnologies has transformed its MRD business from a cash-burning operation to a profit-generating engine in just one year. By leveraging EMR integration to drive adoption and optimizing costs to improve margins, the company is building a scalable, sustainable model. For investors seeking exposure to the precision oncology revolution, Adaptive's combination of strategic execution, financial discipline, and market leadership makes it a standout pick for 2025 and beyond.