CareDx's Q2 2025 Earnings: Unpacking Contradictions in EPIC Launch, Legal Settlements, and Volume Growth

EPIC launch timing and execution, impact of legal settlement, EPIC implementation timeline and scope, volume growth drivers, and surveillance testing mix trends are the key contradictions discussed in CareDx's latest 2025Q2 earnings call.



Revenue and Test Volume Growth:
- CareDx reported adjusted revenue of $90.5 million for Q2 2025, up 14% year-over-year.
- The growth was driven by increases in testing services and the expansion of surveillance testing protocols, particularly in the kidney transplant segment.

Testing Services Performance:
- Adjusted Testing Services revenue was $66 million, up 14% year-over-year, with approximately 49,500 tests delivered in the quarter, a 13% increase from the prior year.
- Growth was fueled by strong performance across all three organ categories: heart, kidney, and lung.

Kidney Transplant Market Expansion:
- Kidney testing volume grew nearly 20% year-over-year, surpassing 60 surveillance protocols nationally.
- The expansion was attributed to the implementation of surveillance testing protocols post the retraction of a draft policy attempting to limit surveillance testing.

Operational Efficiency and Financial Health:
- The company achieved cash collections of 105% of adjusted Testing Services revenue and improved payment per test across all payer classes.
- These improvements were due to enhancements in revenue cycle management processes and operational efficiencies in lab operations.

Draft LCD and Potential Impact:
- CareDx acknowledged potential impacts from the Draft LCD policy, with two modeled scenarios: a $15 million full-year headwind if surveillance frequency limits are implemented, and a $30 million headwind if AlloMap Heart is no longer reimbursed as part of HeartCare.
- The company is advocating for flexibility in testing frequency, recognition of multimodal testing, and bundles payment for surveillance testing during the public comment period.