AbCellera Biologics(ABCL) - 2024 Q3 - Earnings Call Transcript

Financial Data and Key Metrics - Revenue for Q3 2024 was approximately $7 million, driven by research fees from partnered programs, consistent with Q3 2023 [12] - Research and development expenses increased to$41 million, up $3 million from the previous year, due to ongoing program execution and internal pipeline investments [12] - Sales and marketing expenses decreased slightly to$3 million, while general and administrative expenses rose to $19 million, primarily due to intellectual property defense costs [13] - Net loss for the quarter was$51 million, including a non-cash impairment charge of $32 million related to discontinued development of next-generation transgenic mice [14] - Cash and equivalents stood at$670 million, with an additional $210 million in available government funding, bringing total liquidity to$880 million [18] Business Line Data and Key Metrics - The company initiated two new partner programs in Q3 2024, bringing the cumulative total to 95 programs with downstream participation [11] - ABD-147 received orphan drug designation from the FDA, highlighting the potential for future milestone fees and royalty payments [11] - The company expects research fee revenue to decline as it shifts focus to internal and co-development programs [12] Market Data and Key Metrics - The company completed the move to its new headquarters in Vancouver and is on track to bring its GMP manufacturing facility online in 2025 [8] - The company expanded its partnership with Eli Lilly, focusing on co-development collaborations with shared ownership of resulting assets [9] Company Strategy and Industry Competition - The company is transitioning from a platform company to a clinical-stage biotech, with a focus on advancing internal programs and building platform capabilities [6] - The first two pipeline programs, ABCL635 and ABCL575, are on track for CTA filings in Q2 2025, with a broad portfolio of discovery-stage programs in development [7] - The company is prioritizing co-development collaborations and leveraging its TCE platform, with updated data to be presented at CITSE [9] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in the company's transition to a clinical-stage company, with a focus on delivering value to patients and shareholders [10] - The company anticipates further investments in its translational and development teams as the pipeline advances [8] - Management highlighted the strong liquidity position, with sufficient funds to support operations and investments for the next three years [18] Other Important Information - The company reported a non-cash impairment charge of $32 million related to the discontinuation of next-generation transgenic mice development [14] - Investments in property, plant, and equipment totaled$63 million, partially offset by government contributions and proceeds from the sale of a stake in Invatex [16][17] Q&A Session Summary Question: Competitive landscape for OX40 and OX40 ligand therapies [20] - Management discussed the advantages of OX40 ligand-targeted therapies, emphasizing the non-depleting mechanism of ABCL575 compared to competitors [21][22] - The company remains bullish on the potential of OX40 ligand antibodies, with preclinical data expected to be presented in 2025 [24] Question: Data expectations for T-cell engagers at CITSE [26] - The company will present updated data on its TCE platform, including programs demonstrating desired profiles in killing and cytokine response [27] Question: Independent development of TCE programs [30] - The company has the liquidity and capabilities to advance two to three new development candidates per year, with potential for equity financing or out-licensing in the future [31][32] Question: Clinical trial site requirements for government funding [35] - Phase 1 trials for ABCL575 and ABCL635 will be conducted in Canada to qualify for government funding, with potential expansion to the US or globally if needed [36][37] Question: Market potential and competition for ABCL635 [39] - ABCL635 targets a multi-pass transmembrane protein in metabolic and endocrine disorders, with a conservative addressable market of over $2 billion [40] Question: Ramp-up of spending and resource allocation [43] - The company expects R&D expenses to remain stable in 2025, with a significant reduction in CapEx as facility builds are completed [44] Question: Positioning of ABCL575 relative to IL receptor antibodies [46] - ABCL575 is expected to enter as a second-line therapy behind DUPIXENT, with potential to move to first-line due to its durability advantages [47][48] Question: Ideal partnership for the TCE platform [51] - The company is focused on collaborations that advance the science of TCEs, with an emphasis on creating effective and safe therapies for cancer patients [52][53] Question: Update on GMP facility and Biosecure Act impact [56] - The GMP facility is on track to bring its first molecules online in late 2025, with the company well-positioned to benefit from geopolitical shifts in manufacturing [57][58][59] Question: Prioritization of internal programs [60] - The company's near-term priorities include capital allocation decisions to identify a major winner, building a differentiated portfolio, and maintaining operational efficiency [60] Closing Remarks - Management thanked participants and expressed optimism about future updates [62]