HTGM - Earnings call transcript Q2 2021 | HTG Molecular Diagnostics, Inc.

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Operator

Greetings, and welcome to HTG Molecular Diagnostics' Second Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] I would now like to turn this conference over to your host, Ms. Monique Kosse, LifeSci Advisors. ma'am. you Thank

your begin You presentation. may

Monique Kosse

Thank you, results released financial today, the Earlier second HTG for XXXX. quarter its XX, Operator. ended June

we XX, in to or risks statements let company's cautions differ cause events obligation Before on results These the forward-looking With the may regarding this undue the would risks place call, that control, to materially you ongoing subject SEC laws. many of the COVID-XX the the and to and to the of today's are that circumstances as filings. providing are numerous call John? impact federal including me cause its that on Chief securities HTG listeners is customers uncertainties company remarks uncertainties, those the call, on within John statements. forward-looking remind statements. the XXXX, any forward-looking HTG statements meaning results and of materially include HTG HTG's could begin differ its beyond over any and Lubniewski, no and projected to from from information or actual August pandemic Executive undertakes forward-looking that, which not to events include update turn Officer. those of company's this Factors like reliance date I to time-to-time uncertainties described call.

John Lubniewski

results of right quite about, the quarter. talk It's privilege for it. a me today second real review to the Monique. let get to you, the was here so bit Thank there's eventful a be It and company quarter to very to

the for same million for period second last of quarter Our $X.X million XXXX the versus year. $X total was revenue

our related expecting no the million. QX the is revenue increased recovery were our $X.X revenue as direct of we saw services in direct from collaboration revenue, in product XX% returning This This our from our customers XXXX, the to quarter pharma by However, XX of an color, second North customers European was added quarter. was growth which so product pre-COVID operating America XXXX versus Academic, of quarter of with performance quarter the we new XX% To in and quarter, was some XXXX. second there we in add all levels our revenue teams. direct commercial solid generated some revenue to the first [ph]. all-around

We base expanded by instruments. install our active four also

On six the out due eight, year, extended lack front, and impact The we more due in the programs, had for the the of we XX we first past significant programs than the COVID time to This activity. XXXX. new pharma that XX with trials in programs. of to timed finished months XXXX XX see and clinical expect first pharma half of on years quarter of to active was out breakdown added

However, we're portfolio drive expect new and to to the our see this adding in programs are replace out new further continually growth programs timing the programs those business. for that

to We quarter. into third our revenue recovery also expect continue the

miRNA Transcriptome adaption cumulative and because total week, technology. publications new XXX we last again our the also the market gene to XX strong on we bringing our period launched Finally, in exciting of for XX,XXX front, was -- publications an or scientific open product the new missing panel. added nearly demonstrating represented quarter, were This we HTP sale should HTG our Panel transcriptome and Until subsets best-selling This product, that exception released the of now, with favorite gene of in the panels opportunities and U.S. for up HTG. transcriptome new market smaller our on we've Europe. somebody's whole that inevitably

managed of single quarter the met demonstrated a throughout the believe from is Even work or transcription. RNA-Seq in past technical the without sample the superiority that our that eighth we areas, our performance The an timeline extraction to ability over between our market. a released key reverse product very year to a more, RNA small several or with product are entire performance we've white ahead entire is with do and have having a of established and are samples papers archived novel sample we product technology. to complete traditional HTP this transcriptome clinicians fact our ability over development RNA-Seq, of of development and established. more powerful XX% the to It's thrilled HTG in capabilities have we who that milestone team plus designed and profile of XX% turnaround to a only specification the profiling RNA-Seq, three-day would bio-informatics gene or unique the XX% week RNA-Seq, for load with RNA delighted every are RNA-Seq. pass EdgeSeq needed This for integrated our and including researchers processing rate without this of exceeded including We proud time with that process. missed full patented intended enable We technology the to insufficient versus versus samples development using for transcriptome a scientists, the expression to a to enable our and work

solid been this be expect customers all validation of by breakthrough next in phase new by We mind, will and core and HTG. followed online in an for with recovery the major beginning market as ramping exciting of for a development profiling the commercial teams business, assay product a an our this rewarding outstanding providing up initial the sales this demonstrating execution product. of there they customer performance has that bring our product primary for our quarter markets With

use pipeline and of deposit, believe a clinical formation of or build the well-qualified Transcriptome came way because modifications Panel, RNA and us that great to opportunity targeting proteins development. Therapeutics This development field could to and quarter, a platform we candidates powerful us our position exciting develop candidates This outlicensing high-quality HTG drugs ask we're either whether of this caused the to recognize we of announced the modifications. a especially or HTG Drug Unit. new to of better our technology Discovery drug in the remove also RNA We in for drug

attempted points activation late Why improve in defined we We physio-chemical used subsets the screening By three process? measured wait process? lead large leading design. for and that to be properties with and hit drug to who collaborations pharma, and inform respond Given starting drug technology who As can we that discovery. drug create why might to causes so stage why late-stage the discovery small earlier of thought in gene development, our our technology can previously failure we long? use the not had look We not of pathway patients and believe the use believe expression therapies. molecule the noted, this, in efficacy doing for this better safety,

mind, expression messenger and quarters, by just have better-understand gene key and opinion for achieve modifications, was we technical a to in the platform our measure EpiEdgeSeq, transcriptome consult technology the measure RNA EpiEdgeSeq miRNAs last The modifications. to RNA of realize feasibility expression and call core whole pillars: three us studies of we that developing like transcriptome technology of miRNA technology tool we As technology This came we epitranscriptome begin will leaders platform profiling. profiling, next already needed whole importance on regulation several that we team This gene our of its the can knew And With impact do help June. research the miRNA. field, internal we in which results miRNA RNA profiling. that methylation. transcriptome transcriptome expands EdgeSeq at enables that. a product whole spent we have in to to whole a profiling, us also in our that including

differentiated also a this and world-class While help we working industry to success. to therapeutic key to build out this working for are small we platform guide are of a a identify we and chemistry opinion internally, pillar leader externally differentiated successful team The to fourth to solution to enable final construction. veterans we was determined lead needed program program network library a technology that and

platform advanced areas pharmacophore-based and medicinal our disease a things for is profiling go binding as If HTG advanced which screen working in we capability and design, first on this our and our XX to now near our designed are on of advancements design to XX and already might XD advanced of ligand-based to as planned, structure-based, the a sites. technology already advanced We're have soon platform library, also using in and in drug using run we're we term. expect in as technology months. have serve four-platform being first chemistry has place, combination docking variety built and and So, an compound [ph] candidates ordered pillars of leveraging drug tools many first

that using color additional now improve drug our simply for been diagnostics another My technology over advanced of for drug not that, members call Board with partnering find separate to response and This our we'll right evolution to dive up I'd One is with business an to technology and excited is precision out provide drug rates additive also results. partners competition puts pharma technology to asked to technology. to our our we thing the can to the is emphatic help Advisory patient. We candidate opens We're a natural the pharma enable develop Shaun whether technology customers. months, patient drug deeper clinical engine. excited help want to some Building I've us answer advanced for the an channel last, into on no. customers. help a about our what and to on We're begin our the candidates. coming with turn and this financial use right With to core that the the to and about leverages our our HTG trials, Over collaboration discovery using improve or better discovery care. to unit It business medicine our opportunity our a do yet platforms like for start Scientific pipeline. announce was

Shaun McMeans

revenue Total John. $X year. for million you, compared was prior the with $X.X Thank QX from million

comprised statements; revenue, in new included of pursue collaborative anticipate programs. continuing Our collaborations. $X.X services. product-related services additional currently product any revenue completely to revenue million whereas total prior customer existing We revenue do development We're financial defined direct from as of development services year and not collaborative QX was our revenue our

and development development cost collaborative services with transitioning the million product and our the in and collaborative resulting XXXX. of prior cost staff our approximately decreased XXXX primarily of in Costs Our in expense development and in from XXXX California-based by related to services recorded to year. development services development programs revenue are research efforts to $X.X research related Tucson QX prior expense. compared reductions half Research due QX second was and year, and the decreased $X product-related million

QX for product-related compared our collaborative again XXXX, million new prior continued programs Our expenses our consolidation the development research million approximately to unrelated the were year, XXXX. into facility development reflecting of and Tucson to $X.X our development efforts $X.X in for

again in commercial successfully Transcriptome met of to transcriptome HTG goals August design Our the including the of for development XXXX, QX lock the milestone team X. on official Panel, panel announcement our leading launch

was stock and $X of year, $X.XX for share XXXX. stock. million $X.X $X.X per in overall our of our million $X.XX compared and employee XXXX shares result reduction XXXX recognition for This ended of and XXXX reverse to the quarter operating of through continuing expenses. and common management June company XXXX facility Our sold loss QX credits was with impacts of in additional the available X-for-XX the of period reflecting made for for a prior the same our retention reflects ongoing stock COVID-XX loss common our million XX, Net the as split and at-the-market the

for comments. stock quarter sale We XXXX, June common now will As I outstanding. call in cash approximately million million and X.X the cash, with closing turn to, XX, had available John back for we equivalents the ended shares of short-term $XX.X securities. of his

John Lubniewski

of you, I've best I say said firmly and believe Shaun. are again. days still I'll in for HTG the us. Thank front

as transcriptome in and our the start the I'm return core have whole quarter a the of that product. we expecting said said and We of quarter, second of markets to first showing we're our pharma to to the starting continue new business recover we business customer the additions saw the to in to core momentum going both I see strong expected third see And launch of continued in delivered end culture. quarter. to I quarter, We will HTP begin built we we performance HTP afforded recover, second that our rebuilding our us again. our our profiling first on by capitalize At fully results and in the you're I culture profiling see growth over business the saw landmark opportunities business. and quarter. to the the

creating and scope into we existence expanded that insights came best technologies the valuation our expanded for based opportunities. then be stealth core library design platform of announced new new capabilities. and technology on of company, deep and the business also unit drug out drug on July, to of the use business this our on We profiling epitranscriptomic discovery the advanced built our profiling In how is revenue and to of and We've within edges have years and discovery. where market disruptive at been chemical a

the market then next the done $X core we XX%. will can period for map delivery billion growing our RNA we've As reporting milestones. is each a months HTG. those road breakout forward begin and for business, profiling publish for of of milestone be and a XX on core at out The believe to look I to over

believe be and a call product natural to and disruptive this open technologies have a I that, I'd our opportunities new like have great for take the the value We company. afforded evolution therapeutics proven advantage team With to to revenue market for platform another And the company. RNA-targeted opportunity. Operator? and we the driver great use is by can up questions. for a new the we provide of

Operator

first [Operator Kluska time, line be this At the a we'll comes Instructions] Kristen Cantor question-and-answer from Fitzgerald. conducting session. Our with of question

with your You may proceed question.

Rick Miller

on Miller, the the of our and Rick Transcriptome on HTG Panel. launch taking Hi. questions Kristen. This congratulations for Thanks is for

RNA-Seq's for you've full position standard of that you're a launch in little product? you considering the HTG bit base could the talk about completed customer Given as gold space, the from the [ph] strategies the Transcriptome adopters, this growing now Panel early

John Lubniewski

Clearly is industry Yes, words. for and John. RNA-Seq Thanks standard. the us is joining the kind Rick. This appreciate

two So, looking we're really in market at ways. the

of whole experiment they to big going a that our a co-exist run work enough of of with invested people ability quantities. do to simply where sample transcriptome to either have strategy we're enable the to because going sample, already on degraded those We're For workflows, gene have because in kind a couldn't RNA-Seq seek or otherwise sample the low RNA-Seq. don't to customer they have expression they advantages

So, co-exist. it's kind of

because into have challenging technology However, opportunity us we the such in invested bigger it difficult those is that think not for a is in laboratory. actually and RNA-Seq a bring customers to

run Our mostly with technician-level automated technology is labor. be can and

so or actually of you And think RNA-Seq. common cheaper we be to the our scientist analysis, and transcriptome enable faster, full we actually to if man, will, the regular kind better, do research than able

those the I will, on you strategy, I if commercialization. our answered So, question. hope are

Rick Miller

Paper advantages. to Paper more. highlighted White you White I if and And one key I RNA-Seq whereas One believe described being is Sure. may, in demonstrating comparability previously Two critical direct really the

your Three the hearing was were were what customers So, and with the Three? had Paper that, key and of how you've on the feedback I from White White wanted Paper for much with here what written findings trial to ask, based looking

John Lubniewski

question. Good

Paper as really Two our So, couple technology in RNA-Seq, of demonstrated White recall, superiority key really of you a areas. over

was we the The actually had was sample and rate whereas success XXX% XX% sample success where RNA-Seq rate XX%. between first

be why days perfect it major or six can us. four in RNA-Seq customers weeks not, but the And because second was one-quarter load area time, one-eighth which days, versus reasons market in times worked the with RNA-Seq. three out actually to than sample The us seven where for a of more in was turning in weeks data usage sample in you third and get the one turnaround of we be world, are the interested then of between is can

Three used the Paper we was expanded had that set in disease Paper states So pushed the on. a larger White White and data validated we It the of that it Two. all simply panel we across

our basically White So, reproduced bigger Two aspects data than same was set expansive technology. we it of more a and Paper differentiating and those

Rick Miller

very much. you Okay. Understood. Thank

John Lubniewski

Great. Well, thank you, Rick.

Operator

question [Operator Our Nowak Craig-Hallum Alex Group. Capital with next line the comes of Instructions] from

proceed You may question. your with

Alex Nowak

give little trends bit the to panel. Are translational Are trial Great. number our that use? Is just question a total customers maybe or for these academics? from following the signed Did more either last program Kind on the the HTP a you up drug on for early And signed early stage there, right. of up Good commercial give OEM John. color those access All more for afternoon, of even have from these Or everyone. this the commercial discovery? standpoint? to out side.

Just color there be any would great.

John Lubniewski

Sure. We've see the mostly I go contracts used academics you where call their what mostly products website. if for our you'll would actually EAP the all and so on in, we to took quickly. the $XXX,XXX program And early listed was at of medicine because again capabilities being the that sold Duke actually places we've you our adopters. RNA-Seq, look RNA-Seq I so in like MD already as University, what product was it see -- much that Anderson, especially lieu is of translational that have the in get at listed the we want prior of they folks a technology but value pre-launch launch in using the around actually The Clinic, of Mayo accounts, to signed website. on number signed to been in deliver people had total of is to can It significant actually more It results those to XX. say about QX, which contracts, while bringing note

going will in, in is and quarter-on-quarter in see kit. I'm or growth up. the we again, people it So, our Many either ramping then product are to it to available, expect validate expecting that lab now bring

Alex Nowak

I the transitioning product over and whole now also, it's sales opportunity to pharma that's about going that big on the the assume you be That's relationship But know pipeline. great. panel. to salesforce some side? what is to I be Can transcriptome are there core expand build there how on to the team going

John Lubniewski

Yes, great question. that's a

last with just folks in So, our or teams. support and in really team, we XX we kind hiring are is the the about the including pharma the people about We've of or our suffered service over loading four eight got five about staff. up organization and seven U.S. or people months four finished Academic, European three

think of that quantity I coverage. people the we have us give finally

We to more We finally these think meeting As more energized, before than to team I And up. flared to adding see better enough that can to proposition great sales safe delta success, Tucson. here better get had evangelize we team. was and don't this continue it a will our right felt thing ever that's now. people. we have organization variant in everyone just bring finished the go in been be value we've understands a and that we out that fantastic

Alex Nowak

a and And high question throughput platform. appreciate of drug the history I that. a The just Great just was I it's screening. final doing think HTG on interesting. discovery do

of separate those you're drug reason back ultimately that's Or plan little validated that targets, expand So, to a find. something kind and targets that then you'll maybe bringing up going bit. these this off your getting on here companies? a the internally you to entity, advisory the how a either pharma or be some for do to But spin into of little bit going Is commercialize spin team those of roots identify to that off on ultimately board? is this you and

John Lubniewski

question. Great

we I what boundaries at the call be of validated of things targets. the would will of but kick novel, this kind stage business will So, up

and to for will well We what do up hits pick targets good a happening run look to profiling world to expression, at ROI to that we look methylation, to then of to at medicinal data. design develop And of better potency then in compound understand discovery. be that do generate minimal do that private a at those do Then mechanism And from miRNA we of molecule first that are and then compounds or enterprise, use and addition full we gene the drug-to-target by platform the small we'll looking That's not of at again, the hit-the-lead not take in that are to new into actually target standpoint what hits, that this and screens. show process but for continue on will libraries that looking is transcriptomic all, then is to patentable fill moving also off-target effects. we the compounds the to expression, interaction. will chemistry we a a look proven and transcriptomic biology really can

the Our right the be the business not going something the business, pure obviously the to sake licensing exit unit, -- way pre-IND into We assumptions, to would to for the current all current to to as of planning drug just get take clinic, most so business the many are customers. it other a something our the reserve definition but of we unit. state of our a likely for a keep unit drug of business discovery development end

Alex Nowak

Thanks, That's and Shaun John great. for the update.

John Lubniewski

Okay. Thank you, Alex.

Operator

we've the the like over gentlemen, of and John remarks. for turn today's I Ladies question-and-answer closing Mr. to would reached call to session. Lubniewski, end back

John Lubniewski

to like joining would a really quarter. I you. great us today. It's been thank everyone Thank for

we they got for think loyalty this at tremendous to I, that and thank want work make at great self-sacrifice the for and HTG continue show continue the quarter again the to another they the I company. to us. here employees coming

on thank today. shareholders our They've updating I our quarter Board. around together put our and call. our want for fantastic, progress want continued and very And scope technology our thank look to of business. Thank to again been our much their for you Additionally, strategies support. expanding next earnings We to you us I as really especially next also especially forward in we've joining

Operator

concludes This conference. today's

of You your time. for participation. Enjoy lines may disconnect day. rest this your Thank you your at the

HTG Molecular Diagnostics (HTGMQ) 13 Aug 212021 Q2 Earnings call transcript