MXCT - Earnings call 3 2023

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Operator

Good day, and thank you for standing by, and welcome to the MaxCyte Third Quarter Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to introduce your host for today's call, Sean Menarguez, Senior Director of Innovation and Business Development. Please go ahead.

Sean Menarguez

Well, thank you, Justin, and good afternoon, everyone. Menarguez. Sean is name My I'm the MaxCyte. Development at and of Innovation Business here Director Thank conference in participating you for all today's call.

Officer. Douglas On the the and Chief financial and President A the XX, on third of Douglas is MaxCyte quarter Financial results Swirsky, ended for call from available Chief the MaxCyte's Executive press company's side is Earlier website. released today, XXXX. September Doerfler, copy Officer; release

call in comments may need I read following made to events, the during forward-looking performance or of expectations Any this that results forward-looking Before securities we begin, are future to statements. meaning be statement. the predictions within this statements laws. Statements of relate or or federal statements call contained

any are due factors, company because Actual update variety information, forward-looking of in forward-looking discussed has a publicly any results SEC [indiscernible] differ implied statements statements no from may to filings. which materially in those detail future otherwise. when our expressed to events The or new obligation in of or

with over I'll to Doug. turn And the call that,

Douglas Doerfler

quarter, financial Good Earnings Swirsky, our afternoon, XXXX for by our MaxCyte's operational you joining everyone, business a Financial during thank Chief detailed Doug financial of and Quarter and highlights the Sean. Officer. begin a our I Third discussion review will Call. from you, with -- followed DJ, Thank

Core preannounced range. in preannounced range. total will our quarter We revenue reported the . MaxCyte was at of then high open also the the at third revenue our of high questions. million in $X.X call $X end for the million, end revenue

expectations on full guidance call reiterating we the year today, our the business has revenue out on Over of we in our And performed with month, XXXX. the the are line last October for X. laid

customers our from largely for when we environment unchanged spoke in October. operating remained The has

XXXX. of working to sales into balance execution our for opportunities focus MaxCyte actively the and is organization performance commercial across primary remains on XXXX increase business to and the driving commercial improve and at Our expand

revisit the pointed some briefly our are that we on drove which will we on of October to facing call in reduction guidance, I preannounced our challenges the revenue X.

business driver sales. The core in of processing primary or was performance PA assemblies softness

continue the to their prioritization initiatives; financing due covered PA lines spend therapy portfolio has needs; existing these customers partners more conserving attributed third, in SPL drug of a obtaining clinical programs, cell in spend clinical reduction Early-stage pipeline in up for in and challenges of their can reevaluating inventory to clinical inventory customers due discovery and additional delaying operations. their and to We X and XXXX. built believe be factors: the time R&D And to

factor in conservative the which has capital incrementally early-stage Another more business impacted becoming placements. on core weakness our the year has customers as was instrument expenditures progressed, performance our of

year. operating Though this out seen have the unfavorably play we environment macroeconomic

to therapy favor engineering. that continue We The pathway MaxCyte's platform. move see diseases. include industry of that industry continues non-viral to engineering cell Approaches trends across cell many steps multiple toward

they needs, process. scale providing scale continue to their autoimmune the opportunity as support our us cell expand indications to with our up including unmet manufacturing partners new into Specifically, disease, partners therapy their and out

a the Furthermore, cell complexity modalities. edits of gene-edited positions edits given the well which and developers cell therapy increasing performance the platform's on are product cell, with engineering multiple MaxCyte across gene variety their high of wide

for complex supports cell need volumes. the into indications, looking for large which and/or further engineered market also increased are multiple Developers doses regimens dosing

growing process for technical Our the the clinical leverage customers set scientific, to and support therapy our partners regulatory applications. capabilities cell of manufacturing and can optimize and

to Just our our customers. this X partnerships, we that year, the signed highlights SPL brings value which platform

impact for All are our cell therapy as to engineered in an of their trends addition healthy they a encouraged We by progress continue potential through potential commercialization. make the in see reach clinic and nonviral pipeline partners. the the we all, partners programs to to

highly that we of potentially our and to confident revenue expand we our by We opportunity both least million will we different excited guidance coming grow reported $X.X are and SPL revenues to will high-value at to approximately with meet partnership meaningful third line In $X several waves the of this million in of the market. SPL believe We and therapies engaged our our program-related prospective remain come current year. quarter, this revenue. customers, continue the remain as portfolio be support and years

We of progress by potential that look and platform. to partners' excited impact forward the are MaxCyte's therapies utilize

for as clinical and late-stage revenue toward milestone clinical move partners commercialization. Looking commercial development and MaxCyte substantial ahead, our there opportunity is

of In product XX, approved what respectively. and March platform, is our the by Vertex would be December nearing XXXX, date X, PDUFA cell and commercially beta-thalassemia, sickle enabled for the XXXX CRISPR exa-cel first

field Just and meeting the October highlights for benefit which discuss last week, the XX, on the therapeutic for held patients. an advance exa-cel FDA treatment ADCOM the and the medical to important of

in potential cell under all Vertex. we and been of And platform. which MaxCyte's milestone the investments our exa-cel's made result validating a therapy to approval our look We product, FDA nonviral manufacturing a have to significant to partnership believe necessary forward quality first reminder, the As launch. with on payment that would support us end also in regulatory commercial engineered

looking use and a recombinant much the monoclonal production The early larger horizon has proteins trans-elite at time To about and preclinical the we in more bioprocessing capability efficiency workflow of to market. vaccines. the and antibodies, early-stage practice. be our of provide a We time context, standard our help the prospects platform for than expressed excited of proteins rapid VLx expansion for enable efficient into customers VLx clinical and manufacturer unique are to and some scale the improve accelerate continue to preclinical

late-stage customers As will to than scale they with much research at proceed time would. frame. a development leads a activities more preclinical Enabling and result, to preclinical able normally be from appropriate evaluate derive conclusions faster in an sooner them

their potentially can to the clinical accelerate to process assets. brings late-stage investments important promising The the most prioritize to decisions developers efficiency preclinical development to on that VLx enable

that and about protein development, the we current X,XXX is monoclonal for opportunity believe optimistic in opportunity the We the vaccine in antibody, approximately coming and are assets across market VLx preclinical years. recombinant our

lead recently at of Suleiman has including this believe bioanalysis, the at We serving bioprocessing and of the effort, the we as Purification for Sight's to VLx will beginning team of joining Ali addition with to Max Vice guide Executive that Executive the growth Separation and President appointed leadership biomanufacturing, an Ali Biosciences almost XX been Bioprocessing. MaxCyte. Vice President of Toso future bioprocessing Azad with To firmly business, MaxCyte platform. prior in as important experience years he

into and customers focused on supporting investments. are through our targeted XXXX of remainder XXXX, the and we partners For

complex in cell have our as scientific We in already capabilities customers and when and made enhancing as substantial well they support clinic commercialization. the to therapies infrastructure reach progress manufacturing pursuing

drive as Over and today of we at partners support incremental activity. time, we commercial development value are we multiple various believe will substantial making the investments stages

In MaxCyte of supporting closing, current tax program committed and in our SPL current partnerships. to with flexibility. expanding their we continue to operating navigate development partners remains the portfolio our further environment and

our DJ With the discuss over financial to call DJ? that, will turn I results. now to

Douglas Swirsky

decline. to representing quarter $XX.X Hello XXXX, XX% of everyone. was million revenue a third million XXXX the third the in of compared Doug. Thanks, $X Total quarter in

This instrument customers million, primarily well of the comparable In the environment. in cell as of in a and decline The revenue quarter, declined XX% compared X% cells XX% discovery primarily prior quarter, funding customers decline. and revenue drug reported revenue sales $X.X PA we revenues $X.X respectively. therapy representing includes core weaker as the result of million which year $X.X from to third softer therapy was from the year-over-year, to million cell due $X.X in of challenging million

XX% third declined compared previous instrument XX% continue year, face. and the from from leased customers challenging environment to Revenue driven that in PA revenue were to and sales instruments the by our quarter operating the down

of SPL the million as revenue of of progress SPL million revenue program-related our quarter program-related in through compared Due We third clinic quarter of expected. recognized to XXXX in $X.X continued third the partners' to the XXXX. $X.X

third P&L. XX% the of in program-related the the by SPL compared the and XX% down core margin Moving to of Gross mix prior quarter driven between revenue. third in our was year, quarter XXXX

million were operating $XX was quarter Total R&D, overall in expenses sales of compared The million operating third increase expenses of and XXXX by XXXX. for driven the to third primarily $XX.X the in expenses. marketing quarter manufacturing and

commercial long-term marketing innovative The and application company operations, as in invest capabilities sales development as development and to field strategically scientists, business and well to growth. continues product automated manufacturing corporate drive

and total We third investments of of with debt. quarter finished and equivalents million $XXX.X course, cash cash, no the combined

expect our Moving guidance and XXXX we and Core results total to unchanged for to outlook expected October year today million million guidance. be $XX on approximately approximately $XX expectations to call program-related as reiterating that SPL $XX year. are remain third outlook for revenue full revenue the for XXXX We to we X $XX on preliminary million our updated conference revenue million quarter our approximately $X at be year, to previous million is the our from

customer the the guidance remainder environment patterns funding and updated purchasing cautiousness Our XXXX. incorporates around for of challenging

revenues. of the predict more challenging to our we progress this difficult environment due and Which fundamentally customers' the As upon operating been timing partnership to is earlier. revenue core have difficult discussed has forecast previously, dependent our clinical than year discussed regulatory is clearly also to and

and to with million expect in cash Finally, a XXXX MaxCyte and and in our investments $XXX cash, position debt no on remains continues equivalents sheet. strong balance financial to approximately end

cash burn burn $XX our expected million, cash is in million. $XX line for of Our with approximately XXXX XXXX approximately

order goals. our We and and cost XXXX in our the management position have achieve prudently managed to executed company burn long-term in expenses disciplined to

for our to that will in outlook, cash like XXXX we would close remain our plans that support we and believe modest growth. sheet burn future balance revenue and I by reiterating our long-term confident

the to Doug. turn I'll Now back call over

Douglas Doerfler

DJ. industry. their year, despite believe of excited cell the outlook in long-term We're support challenging growing operating they the clinic. partnership thank through cell-based MaxCyte. the committed And we our therapy the gene expanding therapeutics remain Overall, of in as partnerships about portfolio assets advanced development you, for our firmly the environment we and to to progress this the Well, potential

MaxCyte patients As as the and investors, of great have honor always, we partners, as the well team our suppliers serving. industry Board, we thank that our

call for the With that, I over will to turn the back Q&A. Justin

Justin?

Operator

question first comes our Arias. And Dan Instructions] from [Operator

Daniel Arias

And at all least VLx on a system, at there. in lease be comments couple specifically instrumentation able part dynamic therapy. of in the the on become industry, the are that light to things launch. might you has sold quantitative on your Anything just on the appreciate change side, bigger expect on that Do a going the you of the cell that mix? add versus maybe I Doug, then to

just curve when -- prioritization of the some the place lines that, think those along point, could you a whether impact curious tool the about we then adoption across for it's this I'm good I mean taking assets. there, evaluating in think And program usage that's sense your to industry preclinical-clinical

of see of being of right kind that for those Do back a not as are Some that likely maybe burned outcome a really? so less or horsepower. need you now,

Douglas Doerfler

of lot there. questions a There's

Daniel Arias

Yes, there are, sorry that. about

Douglas Doerfler

That's okay.

if about see Let your X cuts -- me I take let and answer at all talk this me questions.

the And make model important these situation that we to well we made business kind of as the mean, changes partners, On look model us And business make with we're tactful comment pipelines. appropriate think some are We being to our business partners. foresee understand for our for instrument a the very I going in. changes of do side, truly seeing model. rationalization we and the about I they're may our helping I at I our and the we're it's approach feel

Although I going they're be major to the approaches, be around edges. don't think they'll

cases thinking use new kind the our again, through for And technology. of

patient Moving into autoimmune where large have populations. disease, you

cell you're therapies to autologous industry the going open think to tumors population. autoimmune serve center and into it's therapy moving moving I to So now seeing blood where up solid from

that, So to business we're of on our an have excited is impact going And that. about model. course,

X a the between to the On that protein the a put quantitatively, months and plus. out able we months in produce VLx, in of traditional couple way, what be system laid the could a being deck versus which we difference slide our believe

when our more a to speed think we're be there's focusing I more I market, speed attention that's lot going decisions. think And on think exactly to to rationalization, on. attention that there's I placed where

get year valuable. to can that's that's the and do line the we -- into cut we thing, faster. same we -- could market and if ADC better early company. X whenever to a be all early-stage could reduce time can off that X do relatively X, They they these pretty stage time months, development to products of frame, big It's And think be partners, the looking They're pharma. preclinical for a the

problems, VLx So address at the that of right some in the we're to at industry we're excited. time. think seeing think, We large. that coming out I is the

Daniel Arias

for Okay. exa-cel we one see you place we just Obviously, consumables in that point, up, were ticking to your there. about closing Maybe curious in place presumably decision your there. consumption their Appreciate are as if here. we'll a assume But scale follow-up. ends through and up. approval, quick those ramp To presumably takes expectation how instrument I'm scale utilization takes on this just

Douglas Doerfler

Well, side we any manufacturing. And of from said, and a this CRISPR you investing that of ready 'XX in terms we're in obviously Vertex's can't be what we instrumentation been support in like, to have up. we've give guidance terms That ensuring 'XX side got will event. and scale looks

breakthrough guess, in our made, getting they announcement therapeutic an release press saw designation just we think Arabia. about I Saudi I yesterday

to be whatever how most fully them and this will see them sense support assured business expands, for that the develops they believe prepared and execute against it interesting we're commercially. be to So makes but plan

Operator

question with next comes Our from Jacob Stephens Inc. Johnson

Hannah Hefley

is Hannah This on actually Jacob. for

talked reach. geographic still this expanding You've Is a priority environment? your this in about

Douglas Doerfler

That's a good question.

focused of changing, all is We're I we're China the situation. we can world navigate -- how course. on the think I think

is I the is and therapy and science into organic The think well certainly we into moving cell expanding -- are into beyond South moving this think frankly, APAC. I U.S. of Eastern more an around it's Europe, America, moving expansion. Europe

. following we're of that are. so -- hubs And where where those activity

field as simple a application building out bringing field it For into in new land bringing a as us that be geography, as could that a distributor be It scientists account. and extensive us to applications new salesperson as could enter into a more people. or on

is the us. investment a interest an makes our follow make we'll from perspective And cell most think what for to is always setting. follow therapy I commercial the where So field always science, then decision sense the

Hannah Hefley

SPL this the annual And in X then you're of per add many And additions to outpace with the expecting usual you your to ahead X year tracking of expect X continue to future? How to X XXXX? in you are X total year. rate to do additions

Douglas Doerfler

we talking guidance, We'll that. to we talk about 'XX when want about resist give

pretty year. XXXX. comfortable we we're X position think I this don't the talk additional -- in really with think did anything We in are a I to we about

Operator

Matt Our William comes Blair. the Larew from of question next with line

Matthew Larew

it FPL risk year maybe [indiscernible] There was earlier seems like pipeline the that then restructuring. over seemed it of X of have that this in sort couple a prolification -- of of risk months, around last restructuring one been impacted your and and partners by of terms we've had around number

we're true size the way high-priority industry a as assets? in to curious a in interaction cut Just go, sort they've programs at? potentially brought of or much How different really your their much the to teams be maybe partners core as they've much down to perspective there revenue on more for customers, down or would just your how is how what from inning of perspective, gauge drawdown with just

Douglas Doerfler

-- one. question to that right I that a got trying the in understand. a of what Sana We've scaling did for back. partners just companies situation and you is in with another recently, instance, are agree that trying who to are we're seen where now I'm couple I'm Lyle, them most we've

is drawn that seeing We're focus So we're toward that customers. is What with those. we're being we're currently to pace keeping those and close with the involved rationalization being products the when them. our

good . a that's So sign.

those a lead overall, point think for on we're I strong that working MaxCyte it's assets.

hopefully with manage for? they where it going want them us, that more them question answered looking they you, decisions. as specific to to mean us They're obviously. situation for those to something I we're to not difficult with next to announce announce very I'm it's there won't and going and -- is predict sure I companies make well the react I your be try responsive think when to share is. now, you're Matt. just that I

Matthew Larew

No, of at. you maybe what get I intentionally I think But hoping kind I addressed guess on [indiscernible] big. to was it was not

lease question I sales instruments as partners. Dan's So be that make the changes appropriate versus around think one willing you're health to referenced, would you second of

change macro environment. external cutting or any be were prices? changes, internal may or noticed instruments kind that or in away environment? you any competition additional competitive it sort of you So in an of to getting changing Have the aware noticed behavior macro response Have you be pressure price around a of

Douglas Doerfler

reducing gross gross companies our mean all that's a think indication proposition that quarter. . and all to want XX% I our I tribute value our margins, to do. marketplace. think about accelerating I pricing the And true. development. ability margins it's And is these One the still those holds X obviously, in maintain to are risk in things

we're competition. in So in just pretty of seeing those where are give comfortable We're we area. of kind anything with really our right now, to data points you of kind in feeling terms not

[indiscernible] have lot companies in trying lot companies get the of figure are out newer out. come are they in take We of A into We've trying us a mentioned on. that to kind seen and how past. the that to can space,

I of points It a in -- environment. the the to I healthy think points non-viral future. it cell that's think importance to engineering the just

would the partners said, they can that out gets and more be our approved, company interested and space. continuing how position be this to market even there go-to great after technology, we're figure project our will in a and in people participate. exa-cel is big And we're trying I that in That premier to how with

Matthew Larew

that, was it just a last little Earlier The the launch. that in call, a quarter 'XX on follow-up there this fourth now would the into grow a one XXXX. mentioned revenue is over We're year generated year -- VLx. that on Okay. in was you

access an it's that start But this you much something contributing is launch. think is sort at is early focused to sharing to may can of us I that just about how you financial share point? Or with the able there model anything be next year? VLx So

Douglas Doerfler

on is much next great I job, really going important clients disruptive be and these the this how just is technology how sharing talking really think about high-profile to increasing to development it it year. of comfortable Ali is doing he's visibility we'll a be of early-stage more the for board, and programs. offering

the expectations So I some in strategy provide view of provide we much we'll be 'XX. a think do and able fulsome so to more when

Operator

from our with Steven question TD And next Mah Cowen. comes

Unknown Analyst

Hanna's follow-up more I'll more to with way. or adds. different tractions questions your in to on has a Maybe Maybe funnel it This exa-cel? to leads business development inbounds SPL potential is Has of led it SPL with the ask success a of potential the regards partners?

Douglas Doerfler

itself be strong really excellent the think to really, I We're with pipeline great. continues folks. discussions having and

they the would that clinic. the Some of they're same them into really have and development support companies, have financial been we've into early fall move don't to where about, they camp stage talking the

I -- our that's and can pause that they're it's that situation companies so we've forward. fair we're that And other working that moving got that same to have SPLs, say with think although

the of was the strong. that sense very is you that in clinical product. it mean AdCom in when was evidence heard heard great did if that the extraordinarily think heard it my we exa-cel there the profile you it, and in think we I you -- -- looks gets we -- heard approved. manufacturing I concern I -- The safety little meeting about

think as through to therapy approved, assets product and in and the to into that that's us they're gets So accelerate looking is to the cell big going non-viral that's move upon help clinic be that going company check our clinic. a able sense going and those the the to I be once industry. box

scale more on more doubt, therapies I the see the mentioned, to few like a system. to think and longer be the of of And seeing an chronic for cells delivered we've no cell efficiency as and therapy. months. expansion autoimmune, to require -- past again, we in new continue We're our will areas of indication well of period instance, we're lot that a And volume of a in of that that with the fits patients also

Unknown Analyst

And guide destocking down process more the question. in Great. when inventory you brought you one mentioned assemblies. of October,

if could gets Some regards you companies this visibility seeing an that be production bottom of a Bob there? comment excess activity seeing destocking that suggests the said picks Could to they're maybe as with uptick And out on customer you have you're recently used? as inventory what up headwinds. any on there earnings

Douglas Swirsky

Thanks for DJ. is the question. This

taken left that starting So and part guidance But challenge of we wanted guidance year, in we've see we sales we can what say is that how comfortably and providing be want it. for to because this don't off. weeks the that X possibly that exceed providing it in sure XXXX, a very we answering about the PA would is we view talking conservative on meet we've make start year just and revised to got

close So of sense for big to we're our We've we've you. And a good here that a is got that customers. PA. very a part got good number

so have And We've guidance, X you in with if only we're the revenue. confident to the be we to against of a us order number. of revised opportunities, into close comfortable the the execute would which left to visibility weeks in need number a lease for got look of year good our good fraction at with very why breakdown

PA that October we've call, course, as the down. side, on And on of really we the mentioned brought

any into factored haven't We recovery.

daily factored a some in we some get But get rate XXXX. gives there. to any the [indiscernible] think in answer seasonality and too information you and that where QX, going your question, really seen what fully to into of start not delve that purchases just to much happens weeks We're X We comfort. run inturn position provide we've from year. saw was I in just later to now us we off haven't depressed, in basically the which do We're the that

Operator

Thank to remarks. I'll back the hand showing you over further questions. call no I'm closing Douglas Doerfler now any for

Douglas Doerfler

on an look the call. forward everyone, us thanks, and your and providing joining Thank update fourth questions. you, to We for Justin, quarter today

a you you. . very Thanksgiving. much. great Thank Have thank all So

Operator

gentlemen, thank today's for participating. program. This you concludes and Ladies

disconnect. now may You

MaxCyte (MXCT) 8 Nov 232023 Q3 Earnings call transcript