Exagen Inc.

What they do

Exagen designs and commercializes blood testing products under the AVISE brand for differential diagnosis, prognosis and monitoring of complex rheumatic and autoimmune diseases including systemic lupus erythematosus (SLE) and rheumatoid arthritis (RA). Its flagship product, AVISE CTD, launched in 2012, is used to differentiate connective tissue diseases and related conditions with overlapping symptoms. All AVISE tests are run in the company's approximately 13,000 square foot CLIA-certified, CAP-accredited laboratory in Vista, California, with results typically reported within five business days.

Revenue drivers

• AVISE CTD — The flagship AVISE CTD panel generated 91% of total revenue in both 2025 and 2024; revenue comes from third-party payors, government payors, client payors and patients, with a trailing-twelve-month average selling price of $446 per test as of Q2 2026.
• Testing volume growth — Full-year 2025 revenue growth of about 19.7% was driven by an approximate 11% increase in testing volume and an approximate 7% increase in ASP; AVISE CTD volume grew 11% in Q2 2026 versus Q2 2025.
• Reimbursement and ASP expansion — AVISE CTD trailing-twelve-month ASP rose from $428 in Q2 2025 to $446 in Q2 2026, reflecting payer engagement, appeals, revenue cycle optimization and the addition of eight new biomarkers to the AVISE CTD panel in 2025.

Recent performance

For the second quarter of 2026, Exagen reported record total revenue of $19.9 million, up 16% from $17.2 million in Q2 2025, with gross margin of 61.3% versus 60.4%. Operating expenses rose to $13.9 million from $13.0 million, producing an operating loss of $1.7 million, narrower than the $2.6 million loss a year earlier. Net loss improved nearly 30% to $3.2 million, and adjusted EBITDA loss narrowed to $0.1 million from $1.7 million. The company ended the quarter with $24.6 million in cash and cash equivalents.

Strategy

Management, led by CEO John Aballi since October 2022, describes an operational turnaround aimed at returning the business to revenue growth, expanding gross margin and reducing cash burn while investing selectively in R&D. In 2025 the company added eight new biomarkers to the AVISE CTD panel and published peer-reviewed evidence supporting the test, and in Q2 2026 it cited a systematic review of over 3,100 patients across 14 medical centers validating AVISE Lupus performance. Stated priorities include continued clinical evidence generation, pipeline innovation, payer engagement and revenue cycle improvement, and AI-powered tools supporting rheumatology workflows. Management also emphasizes building the company into a partner of choice for doctors, hospitals, health systems and payors.

Risks

• History of losses — Exagen has reported annual net losses every year from 2021 through 2025, including a $20.0 million net loss in 2025, and may not generate sufficient revenue to achieve or maintain profitability.
• Payor coverage and reimbursement — Reimbursement comes from commercial, government, client and patient payors, and if payors deny coverage, rescind or modify contracts or policies, or delay payment for AVISE tests, commercial results could be materially harmed.
• Concentration in one product — AVISE CTD accounted for 91% of revenue in each of 2025 and 2024, so any decline in its volume, ASP or reimbursement would disproportionately affect total results.
• Reimbursement ramp and payor headwinds — The company disclosed that reimbursement for its new biomarkers ramped more gradually than expected and that it experienced payer headwinds in the second half of 2025.

Outlook

Management increased full-year 2026 revenue guidance to $72 million to $75 million from a prior range of $70 million to $73 million. The company stated it believes it is well positioned to deliver continued revenue growth and positive adjusted EBITDA within the next 12 to 18 months, and its CEO said Q2 2026 results put the business within reach of sustainable profitability and cash generation.