AbCellera Biologics(US:ABCL)2022-08-10 04:10Financial Data and Key Metrics Changes - The company ended Q2 2022 with over $1 billion in cash, cash equivalents, and marketable securities, indicating a strong liquidity position [6][41] - Revenue for the quarter was $46 million, driven largely by $33 million in royalties from COVID antibody shipments [32] - The net loss for Q2 2022 was approximately $7 million, compared to a loss of $2 million in Q2 2021, resulting in a loss of $0.02 per share [39] Business Line Data and Key Metrics Changes - The company started four new programs in Q2 2022, bringing the cumulative total to 88 program starts, with a 19% increase in programs under contract compared to Q2 2021 [26][27] - Six molecules are currently in the clinic, with a U.S. government purchase order for 150,000 doses of bebtelovimab received and partially fulfilled by Eli Lilly [30][31] Market Data and Key Metrics Changes - The company expects continued strength in research fees and anticipates the majority of total 2022 revenue to be derived from royalties on COVID antibodies [34][35] - The new commercial sales arrangement by Eli Lilly is expected to result in additional royalties for the company as usage normalizes [35] Company Strategy and Development Direction - The long-term strategy focuses on building a competitive advantage in antibody product creation and leveraging technology to drive drug development efficiency [12][9] - The company aims to attract top-tier talent and expand its operations and capabilities, benefiting from industry rationalization and consolidation [8][7] Management's Comments on Operating Environment and Future Outlook - Management believes the current market environment presents a strong tailwind for the business, despite challenges faced by competitors [6] - There is no indication of a slowdown in development from partners, as high-quality firms are expected to continue moving their programs forward [92][93] Other Important Information - The company has signed new deals with premier venture capital firms to unlock breakthrough science, allowing early-stage companies to start discovery immediately [15] - The company is focused on technology development efforts that could lead to valuable assets, with a strategy to partner these assets for clinical and commercial development [23][64] Q&A Session Summary Question: Can you provide more context on the first adventurous deal and its potential for replication? - Management sees a huge opportunity in using investments in technology along with a partnering business model to allow the best ideas to compete effectively [45][46] Question: What is the next step for the COVID antibody royalties? - The transition from government purchase orders to direct sales by Eli Lilly is viewed positively, simplifying the supply chain [52][53] Question: What are the short-term plans for the over $1 billion in cash? - The company plans to invest heavily in capability building and vertical integration, with a focus on R&D and sales and marketing [54][55] Question: How broad are the pre-partner programs across different therapeutic categories? - The focus is on technology development to solve significant problems, with potential for multiple therapeutic opportunities [60][62] Question: What is the exposure to small biotech companies in the contract portfolio? - Approximately 60% to 75% of programs under contract are with biotech companies, reflecting a broad distribution across the sector [71][72]