NSTG - Earnings call transcript Q4 2017 | NanoString Technologies, Inc.

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Operator

Good day, ladies and gentlemen, and welcome to the NanoString Fourth Quarter 2017 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions].

As a reminder, this call is being recorded. to host like Mr. today's now would introduce for your conference, I Farrell, Relations. Investor President Doug of Vice Sir, begin. you may

Doug Farrell

Thank you, operator, good afternoon, everyone.

Joining Tom Earlier today and financial me is Brad year fourth the Gray, call on quarter our results and for CEO; Bailey, we today, and CFO. our released our XXXX. the fiscal President

our expanding we future a reimbursement strategic statements for number and call, status of projections, existing penetrating objectives, addressable business financial recent factors, about trends and and statements related third-party timing that the this payers, development of markets, interactions related with and During collaborations, and outcome offerings. of planned may and and focus any make future anticipated success growth and including our are product forward-looking, prospects decisions, and

many subject are uncertainties described are to which control, the in uncertainties, time filings. to and risks our risks of including statements SEC from and our beyond Forward-looking time

materially undertake me today’s call differ that, on let to from turn projected to may forward-looking With any Brad. obligation results publicly over no Our statements. those we the and call update

Brad Gray

and Good us Thanks today. afternoon Doug. for you thank joining

and plus Before appointed in Tom to a our who into Bailey, introduce in I years at is the Med relevant DLJ. in Suisse I decade well results, XX want XX Tom investment the as details of January. years than as brings get including more CFO of as our experience Credit industry, Tech banking

our turn the Then followed our QX summary quarter, operating of provide remarks to have overview to week. Conference our for of to next with Tom and and review in strategic of XXXX. chance Cowen a prepared I’ll and during meet objectives begin XXXX of over year for guidance specifically call excited to We’re the details a Tom in results Board the an my performance I’ll who’ll the fourth at many you on him ahead. have the by Boston

platforms. transforming on while continue scale execute advancing we’ve to our that parallel differentiated been pipeline highly scaled platform Over company fully last NanoString transition opportunity, focused a on nCounter single technology small we from the technologies. of commercial in year, This multiple requires a existing with our robust to company

suffered lower growing business process an changes during quarter our as the During in and waited have base number organizational XXXX, nCounter when resulted pains, of challenges impact. revenue we we for a in personnel, to third

these sequentially sequential During academic bear fourth of and began to our growth the year-on-year, the customers. fruit. delivered stabilize service we and strong changes X% business, was across to XX% grew quarter, that as We bio-pharma products both began number revenue and

sold. the showed QX units were QX stable instrument sales and of over Science to While our year challenges. for year. recovered the up revenue approximately XX% prior in growth accounted CodeSets by double-digit placements half came Custom of nicely spread of approximately from revenue panel XX% QX prior and below year-on-year compared the sequentially consumables offset Spread Life relatively

model. as over we our and Overall, base with and investments QX course to with substantially outperformed channel using our consumable improve profile the core reps growth consumable are of business encouraging territories reps mid-XXXX I’m territories impact performance our of signs Importantly, of XXXX. poised field the believe traditional showed sales pleased our

for the our outline I’ll objectives Now strategic year.

be Our continuing factor achieving which critical growing our and primary our number leadership the research oncology business. focus in for objective, A strategic is nCounter ahead diagnostics. is core extending one our year in our will success

oncology. the past field a strong the of position NanoString carved in years, several has out Over

over have series introduce panels, Our suited we of nCounter the large vast the the of both profile which since with XXXX, platform uniquely past FDA to Cancer our biopsies. consumable growth molecules our numbers along in clear Assay of of from panels Prosigna tumor These Breast In is years. become academic and adopted tiny PanCancer began three improving widely our bio-pharma research. majority

in tremendous of leadership scientific demonstrated the further customers presentations the number by made cancer is the in at field major meetings. Our research growth by our

a we become leadership, is for motivation nCounter consumables oncology a XXXX. to line existing In new series. XXXX, researchers, tool for must cancer accounting XX% our the Panels expect growth driven become the instrument and in of has about this PanCancer a have continued As called continue by with many XXX system approximately adoption for new platform placements primary of by purchases, relatively

panel first developers. and tumor, incorporates we XXX most built history. the by company IO In proves in XXX anchored that Merck lymphoma became the drug Prosigna. our Immune with the remains Our subtyping our XXXX, with immune and launch number the the panel XXX PAMXX PanCancer basis sales panels series, the collaboration Signature we between the is of information from that during Later formally selling the cancer. in assay. The Profiling growing introduce cell-of-origin planned lymphoma a consumable the it diagnostic In our September, the Panel signature application the panel series, cancer the it that will research our we At for XXX XXX IO rates to one XXXX. interplay is which particularly legacy panel appealed a complex around launched microenvironment signatures. to in underlines is signature And immune year, successful panel quickly that expanding double-digit response developed breast launch focused as was AACR, at and leverage tumor with in additional launch we’re that oncology XXX

facilitate lead studies companies business. of our Companion Diagnostic growth Collaborations. applications We in growth expected core bio-pharma our Diagnostic to one technology driver these of panels are another drive revenue day will not by may that also only consumable but

nine as in $X.X and States, well Prosigna United Prosigna product diagnostic continued breast reimbursed Many than Spain testing milestone in about assay, the of over year, over business and which covered growth. in coming first the online PMA we’ve is laboratories last many QX. our Our for now Denmark. driver potential months and next new are revenue diagnostic Prosigna was occur as branded including a and enters position patients ever for have we for lymphoma sites we’re is could XX% Prosigna over or pending patients from XXXX which filing increase XX next studies. more XXXX. LymphMark, in our The competitive optimistic meaningful XXXX testing growing new million strongest cancer XX% the enjoyed in the ongoing results to France,

While remain, important see oncology expected for NanoString, growth opportunities to for the market most markets. exciting in other we is

look and new as prioritize products developing pain one of oncology these area our order areas for announced Last well problems nCounter nCounter of funding as drive targeted potential apply that a science XXXX market new to key new fields. second new areas and to bio-pharma, therapeutic our look funnel scientific the for for two opportunities. application addressable therapeutic well playbook we in and carefully for NIAH date compelling same objective consumable in by suited. successful expand Our strong scanned growth. points and into areas to and us year, instrument is of with which and by applications, strategic in We vectors the We and then is made questions

our therapeutic legacy can be oncology of the area were types. two first XXXX, new disease Autoimmune gene several such activation for profile state we already more that and focused is In panels covering mix introducing historically as number Discovery a expression panels cell mechanism, XX diseases. are offer this our market Panel we’ll and on field. that Immunology The immunology; behind we been immune field prioritize has approximately

been prioritized second than abundance characterized by area activation is Unlike, states traditionally therapeutic different The which types. like funding is receives actually tools. on more and of neurology, by disease cell dependant field immunology neurology the underserved NIAH genomic that processes, of which oncology the is

dementia such [indiscernible]. launched Our on third as abundance Neuropathology cell quarter of ALS, and for important provides was in the types Alzheimer’s, Parkinson’s, research assumable Panel, five which the and diseases

Our which in Panel, XX was inflammation important earlier and abundance assesses of this Neuroinflammation central XX and cell disease. pathways quarter neurological provides system the types immune nervous launched

market application dominated throughput terms areas, In traditionally prioritize low qPCR. high by FLEX, of the new gene into entry expression we

vastly line expression on XX product XX we genes barcodes which This both nCounter than allows introduced each nCounter helped in reallocates of the nCounter continue and to samples. equivalents in interest samples driving the qPCR XX experiment. that expected of using run has already genes the PlexSet profile purchase simpler PlexSet XXXX. is approximately Our motivate XXXX workflow across systems to a and to is

do the or Digital our Prior we studies universal the on researchers also prototype third spatial and advantages to-date DSP of the Our Spatial through level, by to instruments DSP size DSP Reasons that under meetings. and substantially could proprietary instrument. believe objective could spatially A NGS. DSP RNA the run to have nearly gene nucleocapsid with we strengthen field that expression interest included enables a spatially a customers to major enter market we for our for exist. a own DSP our presentations month over or and through across or that NGS cultivate shape sequencers our and announced customer ability first, customers; has open the potential for multiplex them suitable us that program experiments protein resulted combination engaged of scientific Profiling single will in generation next protein of The of XX focused have use landscape year, allows the cell novel The support profile their sample. precise access of us program demand on combining read on helped antibodies Digital all we numerous samples out any expand to product Profiling using access Last an and strategic Spatial Throughout access to can stream DSP and this virtually platform. is instruments short It the platform projects given nCounter down quantification not a purchase out a early NGS laboratory to both end. instruments. launch. XXXX, believe of of for our technology on both the to is move a genomics any steady oversubscribed be at DSP plans measure of reading is will opportunity. same year pay when technology the tissue to program launch

XX region. two And Hyb XX,XXX samples native are believe a AGBT region or seem mounted high adopters of NGS potential molecules DSP sequencers. our These slide each generation read biopsies the era simultaneously at throughput target profile than platform & imagination the prototype past genomics for unique of more We platform, allows cell study, each years. DSP were and genomics In biopsy. realm a and penetrate over and highlighted open in instrument Simultaneously platform. attendees, second transcripts using X,XXX slide of the the install as out were own to XX has in early several technologies. then proteins our over spanning our and to using next base mRNAs read beyond study, XX These now on and month much DSP mighty new research has the AGBT of capture of who inter mounted to slide reasons profiling profiling studies biomarker XXXs Seq DSP and been the processed Orlando. the on potential last advantages DSP basic NGS interest. moving a science, of highlighted single tissue the luminous Conference out each regions in of in studies that positive pathology were enter Second, were expectations the processed in spatial The response of to one exceeded presented with per X,XXXs of the

Meeting workflow the first we’ll full the AACR early limited cultivating DSP half for participants we’ll of In and the several program in year, access access its data. preview commercial April, of interest preparing to technology provide our the shipments a Late during program. the technology in planned begin in will of are continue the and present platform. a the an this instruments under DSP program launch successful At meantime, We XXXX. as we customer instrument

stay So tuned.

Hyb the Hyb substantial Seq advance commercial to progress months. our platform launch Seq strategic in with fourth Finally, made is the last XXXX. We’ve towards & objective XX over &

infectious Hyb collaborators of leader the a and in in & sample development the that mutations last fungi February answer & expression set of the Hyb & copy and organisms. Our oncology was Seq AGBT of multiple presented turnaround how sequencing cross-kingdom sequencer & the and on and to to In important, experiment ovarian data disease. luminous ability detecting formalin-fixed an the rapid Cornell, these The and with testing presented Hyb samples. potential nanoscale for the during from Most pathogens funding which Dr. studies of month potential technology tests that and paraffin-embedded application industrializing clinical both molecular replace viruses. that unprecedented to described diverse overall a workflow for disease they Lam from collaboration, on clinical & RNA & unique who arrays monitoring. included which focus that achievement The Research, Dr. Seq’s was the the was comparable most the use and simultaneously highlighted securing markets, cancer and our projects, its platform study of order simultaneously Seq well-suited first sample conference first cancer variations demonstrating Seq capability Hyb from and the infectious partnership Chris is efforts important platform the to we Seq’s XXXX development from identification in researchers of In supporting mighty data Seq simplicity Mason gene profiled XXXX. DNA & was capability the Hyb number make samples suitability sequence quick surveillance Mason using of infectious exceptionally of bacteria, for demonstrated for time, obtained directly platform. to increase publicly rapid presented applications. for Hyb UK important accuracy Research and or to Seq Hyb second At has AGBT used two of performance. Cancer

planned full more and performance. customers Hyb the fall. [ANTH] set data [ph] or of to to of with in a launch be attributes We to meetings of presented customer Seq robust ease demonstrate commercial followed instruments by the we next as XXXX collaborate the for to number such XX place unique months, the the of Over & at use next in XXXX. in AFHG sites beta at aim the Look a

our the QX XXXX. financial for Tom, to over our review and to turn Now, call guidance I’ll outline results for

Tom Bailey

Thank you, Brad.

Before part of and offering begin excitement for and the review my to and of of people grow day XXXX financial and we be technology would will look as as Board I to the improve to opportunity experience Brad at our predictability we team future my I learn get and here business and our our to teams like results that, business, our grown My NanoString’s business this quarter to fourth the about pursue Brad, financial supporting each our forward to contributing the our a results. I revenue about and outlook, thanks to Directors future a has NanoString by our more I development of and continue the opportunities. With turn company.

million the recorded growth, was stabilizing instrument We demonstrated product of We our of quarter fourth revenue PMA quarter we Lam remaining XX% a quarter a revenue. $XX.X program accelerated R&D $X that’s this improve majority million, generated by Companion the XXXX, quarter, from compared recorded collaborations fourth pursue markets. XX% new the into the million the to Seq million nCounter revenue that with revenue platform service sales our the the in was quarter, Hyb fourth evidenced support from of derived in Prosigna XX% million million $X.X our & the million funnel, our our Lam The instrument filing year-over-year collaboration received sequential margin Life million driver our a was an million $XX was R&D a recognition for was fourth of in and to quarter we Research. a revenue platform decline the which total XXXX full the was increases a partnership while the revenue million expense our the was sequential all The of record X% to of total our the Gross for program. XX% from revenue compared including million quarter, is DSP driving adoption consumables sequential relates for to fourth fourth XXXX. increase revenue the was undertook of QX representing quarter return for was product was year-over-year year-over-year growth, quarter the for XX% being For away activities and good as from by Service that on $XX.X less previously of $XX.X XX% about into an were research our $XX.X increase our of $XX.X consumable Merck sequentially. announced and million drive a total decision technology to of and from year-over-year. Research than and not driven sales, that remaining over which Diagnostic of Product. representing XXXX fourth during The access the year Prosigna launch. in year instrument by excluding and represents virtually $XX decrease accounted and of XXXX; XX% XX% prior to $X.X was reflecting to revenue which that growth we investment XX% the promotional primarily business Science service $X.X compared placements primary DSP sequential for with R&D new growth. a commercial spending for majority reported progress in increase. significantly in perspective was of is from collaboration $XX.X

ended quarter the and was short-term million the Stock-based full year new $X.X expense result in with were $XX.X XX% channel as main million increase expense the to personnel for Our period XXXX quarter investments. primarily commercial SG&A of presenting This which is $XX.X cash in million XXXX. increase fourth of made first we the our the for and with for compensation compared the quarter was of QX an investments Board. on

to there of on are details a moving our highlights that few we takeaways. believe Before the are important guidance

and our XXXX First, will service low double-digit product service expect supporting we outlook and revenue revenue product to ranges. in growth stabilize mid-single to continue with in

million year Second, increase million believe introduction in our in to $XX expected to $XX our our to product year marginally with use $XXX cash compared the expected just total total net year of This of operations continue outlook currently amounts $XXX to revenue XXXX XXXX of and and to the as be loss. increase of the first the and to course expected only million improve an $XX revenue XX, XX% is expected half during for XXXX, of million expect of quarter. in service instrument we despite $XX that first GAAP support With million over is We of ending our service XXXX products revenue placements placements. revenue to will and the million. be that to over and those expect is revenue XX% growth will recorded split with comprise between assumes the consistent instrument XX% approximately December

We the pull between continues including and of our growth with expect a and million in $X toward Prosigna increasing the by million. linear consumable a base driven in to fashion through range shift percentage be of systems outlook XXXX $XX,XXX sales of continued panels. This consumable assumes per installed annual our in $XX,XXX Prosigna SPRINT $X system to also sales mix in

placements $XX from We about on discussion. including product on expense Panels, currently good CodeSets the XX% vary and cash mix and from million that’s to we margin of anticipate may to of expected gross range million, consisted range the instrument a into collaboration receive and revenue, Prosigna. to and $XX pace be and quarter-to-quarter lead among revenue Research expect with approximately depending Collaboration about million of XXXX. expect $XX Lam our XX% consumables mix a is service For we this of

range compared expenses and and research be of million the $XX $XX to to million XXXX. as of expect approximately increase We in development to XX%

development modestly We expected is the $XX by & support expect $XX be relating of Lam million which compared expense is business project, our $XX to XXXX. R&D to Hyb lower offset million about from to DSP expense remaining between million our and R&D our to core received Seq to be amounts and

annualized expenses, an to X% $XX to to of X% million, run relative administrative we only XXXX to rate. expect selling, quarter For general reduction record $XX XXXX our and million increase fourth and as compared to a

launch sales Importantly, expect support. launch of additional through primarily marketing majority DSP investment existing channel DSP support we with to of for application our being for and the DSP, the the

$XX other expenses representing $X million to compensation to million for XXXX million expected are other with cash million are more be for $X expected As $XX is and is expected stock-based $X.X million. and lower and GAAP approximately million million GAAP interest planned portion $X only between approximately capital $XX to net $XX net and items, expected expected is expense, is and to between and capital used interest loss. expected million, $XX operating in of expenditures on cash expenditures expense marginally activities be the and be net XXXX be total to loss $XX of to our for million, is which million between XXXX

be about and to revenue cash, us initiatives. Lam current collaboration. expect We XXXX our development our will believe received to and to opportunities are financial resources current enable cash to same available and continue respect and With business and given support our structure broad the the us of the additional we collaboration

expect In other for would terms agreement unlock us addition your Brad believe to maintained and available established it access a we time favorable options, And us so. $XX do your back our to maybe to you from for NanoString. creative alternatives interest should discussion. at I’ll Besides that we conditions Lam cash capital. conclude and equity, turn from these receive and value million Thank now to to to today and be to additional support, the raise Research, enable aftermarket we’ve for

Brad Gray

that over well deliver positioned In is improved core the stabilize as nCounter believe of Tom. we business to course growth summary, top-line to begun our Thanks and XXXX.

is and Consumable larger from established as now and into such a as sales our benefit strengthened it team by growth nCounter is neurology. substantial technology being leadership an its new well the fitting was driven been expansion to markets, oncology XX% than ago. of installed base channel. a immunology beginning We’re expanded as from year commercial in our adoption The a

core business, our launch XXXX We in progress In of platforms XXXX. over to in look course and updating question. instrument now XXXX. like of line a and highly new innovation we’re addition with to our to forward expected I the period on to two unprecedented recovering the for open you differentiated

Operator

[Operator Instructions].

Schenkel question comes Doug Cowen Company. first Our and from with

Your now line is open.

Adam Wieschhaus

Wieschhaus It XX,XXX which a questions. Hi guys taking is looks record thanks there. consumable streaming on this Adam impact so, Doug, for Can Hi your much your quarter little it on a slipped annuity like this one be like or you for that my this around budget more team, Thank flash is guys. in revenue QX that would you be very you. or any was for factors due the sustainable helpful? through pull to approximate how any provide metrics would sales or versus could time forward, expanded going maybe of reinforce color

Brad Gray

Adam. Thanks

fourth quarter science pull and the through consumable include about life $XX,XXX Prosigna. in you as consumables consumables, So when

panel it’s strongest substantial typical over for is we guidance total, pull our being third quarter year-on-year the growth to pull closer through for QX, make there the was year does of to in CodeSet reasons our which pull sequential per that strongest With quarter substantial year couple continue a was jump $XX,XXX $XX,XXX per are see said, see increase decrease double-digit were particularly implicitly revenue in and decline through from for the large CodeSet, flat about that continue encouraged which on he transition, in rather in least is revenue. to through, XXXX. that XXXX We and of improvement Tom, XXXX the a the Custom a the to a and through at in Now and that. we see that we XX,XXX to pull recovering for it to to guidance system. in consumable see full as quarter system his year is of mentioned the assume pleased

decreases installed through system to pull encounter of which the SPRINT time lower is, base goes every goes as balance which up the our pull expected on. naturally that’s is first The through year, have our

continue sales in the our great those mentioned these to from didn’t did is, see new remarks on by made specialists pressure instrument consumable we the to side that responsibility sales With consumable the XXXX. changes XXXX revenue I mid-year and just consumable reps also our for side continue we productivity second consumables just that see substantially The reps to that actually we being impacting outperformed in as regions regions Custom had commercial of it’s suggest that prepared offloading we expect QX, or on CodeSet in to, regional some now my did on that said, that the are as we more some those instrument would sales not on reps, becoming productive. in

QX would model too clear pull through, we So in overall, $XX,XXX be in we’re pleased be to t high with the recovery we saw XXXX. experienced QX, but want we consumable

XX. Our guidance to assumes XX

Adam Wieschhaus

the Okay, I color. appreciate all

previously you well coupled sales with overall, this a are could position the that largest low incumbent that opportunity your perhaps On now imply were instrument think reps, pretty which consumable could and faster previously ramp dedicated placements opportunities you side, would with you burden I demonstrated reps had instrument maybe consumable this large and funnel for year. than sales rate close at for they

make So Thank year that then over well? expect then could placements had that’s the in of sure course QX QX we in unusual assumption, of color as should on an cadence any if XXXX and you. provide considering and some you dynamics instrument reasonable the

Brad Gray

potential believe the structure last Yes, XXXX early answered. the have changes basically mentioned our in question reasonably being productivity are in do the revenue With reps. as of but new productivity, increase instrument days we to and consumable I it’s constant instrument implies XXXX. to so our our that too guidance I that said, commercial in from reps going the Yes, to the the increase

stage flat So, of not teams with so about was you an to I a to to guiding improvement instrument XXXX XX% the think revenue XXXX, stabilizing in prepared revenue we’re as revenue. at we stabilization recall, guide instrument sense instrument in increases this instrument performance. revenue for to And in XXXX does overall substantial instead represent are but from XXXX, down from a

year is guiding the of course over XX% XX% or half and the $XX service Tom we’re in terms to overall I year, In revenue. have guidance revenue of second for you we in products and to the best of for expected QX total and $XX facing first made about then our think the in half for the the that specifically million million comment the the that

Adam Wieschhaus

you. thank Okay,

Operator

Our next Tycho question comes from JPMorgan. Peterson with

now Your line is open.

Tycho Peterson

I given up Brad about it follow investments in the be incremental that instrumental way guidance commercial we’ve instrument just want thinking on overhaul, the right this year made just flat growth, why to channel? the to thanks, given is Hey the question,

Brad Gray

think, I set to head and company the XXXX. we into coming some up success as on Yes, Board for wanting with

guided We have for not perfection.

guiding year in stabilization the in are returns added the type half in quarter. a growth by, had half. improvement we second We the fourth rates We’re territories consumable for followed great where more of first in historical reps continued the the productivity and those

really were flat where a by trend I is and and instrument guiding for following to revenue approach stabilize taking, make XXXX think instrument to placements quarter we’re from down. year XXXX, one So a be not cautious to

Tycho Peterson

the talk a little CMS Prosigna, about, you And then more your bit following specifically correction? what expectations there can price on

Brad Gray

quarter, CMS successfully PAMA. year United the will that as so, that grew of per out challenge Prosigna be a addressed you came test, momentum it $X,XXX XXXX last substantial middle has of Yes, grew with We over reimbursing in is, higher than in year-on-year emerged patient fourth Prosigna had in the know XX% per that we that; it in States. over

the I United our when Prosigna regions. private in of that two-thirds in that’s Nordic both we the from continued a United successes the would the lives our drive of revenue CMS. terms at to has we by say in and government test the challenges as think States Europe of I growth exclusive help Prosigna coming been growing. example made covered and look continue Europe been XXXX, of going Denmark have we to more see Recently, And, there with in the we historically payer covered covered see country and or solved in really that’s States, our the the So, growth recent momentum where faced decisions was reimbursement

don’t good in type growth that feel momentum, all the for rapid market we to market but say as the nature in share. or of is we So, past shifts the think inflection about this

market face XXXX. Europe continue will the competitor the strong We as so growth look slow in and the we incumbent States source of at be United in to and laborious, think share I primary gains

Tycho Peterson

talk Okay, little know the the bit how necessarily table the then, front, is I of you but deals just those Companion about big the can the discussions, pipeline what active and companion on kind days, for these a on are are? marketing

Brad Gray

Diagnostic continue we in number be Yes, to companies with large a Companion of potential Projects. about biopharmaceutical discussions

studies the know by cumulative of I studies those increased call diagnostic retrospective samples our pilot best these II trials. the what mechanism of Phase XX%. is we in analysis providing do driving in you we assays Phase pilot XXXX, to through number As forward or they’ve discussions to for And collected companies

So, we’re extremely active.

series panels with IO tumor XXX, test pharma et of In XXX as means products company research Prosigna to out inflammation another breast which sold signature our PAMXX signature our cetera. only straight-forward for give just with the XXX are cancer addition,

companies. of the level engagement that of So pharma overall increasing

we So but handicap next place in of guidance partnerships a we'll in and not to and of to I'm at that this in optimistic are the able included put remain timing time. deal in be biopharma the none position future, the hopeful them

Tycho Peterson

year kind on next should we opening that contributor And talked of the through? of big you not and then, $XXXX sample commercial it about right. all expected customers range. necessarily All lastly guess dynamic per NGS a this but at up we DSP, revenue terms as access early how to about and pull pull the through thinking release in consumable in change be about year think I

Brad Gray

Yes.

we of exceeds gene which the basic per far value paying non-spatial DSP to out that was samples we contrasts their So, panels of most a the that we of are information us run with customers $XXXX the suggested technology sell expression fact today. provide popular our for. about think program And sample you is That indication the value on $XXX prototypes. our that best sample what our spatial the information as access

value XX two [indiscernible] increase that between customers. of different those capturing the an interacting So of with modes times

be to on that yet point than instrument of consumable will prepared price lot experiencing that we're pull hope today. consumable not for to the us through So system. that the the We're gives higher pull DSP XX a substantially XX -- a the that and nCounter's to guide number through on

the of looks of dialogue demand and elasticity we're think about I like. lot market a customer undertaking still what research

the nCounter's to we're of the wide own of can price instrument as objective going maximize and the our genomic these think possibly concept spatial profile that we it's and so put we as to this not to drive can many as we launch revolution the will of skim is genomics be adoption think to really to front systems market capture. and spatial we spatial that digital Instead be exploration sequencers trying I in that come. and

and but pricing, up on thinking probably all for us through from for on pull to that goes for year that's makes sense look how say information So as launch, about DSP. we're commercialization year a the more

Tycho Peterson

right. you. All Thank

Operator

comes next with from Schulte question Baird. Our Catherine

now is line open. Your

Catherine Schulte

Hey guys thanks questions. for the

Now you? so that then written plans the many get to applications capabilities company DSP instrument have co-market potentially And to sequencing worked that Do you for have how to any into have with you customers DSP. a with you get grant read-out NGS far?

Brad Gray

Yes.

prelaunch potential of we upcoming DSP at couple grow the that ATBT DSP I decided Access to would grant us Many instruments in ones count write-ups we dozen major Technology I the for showing suspect it supported initiative became and wanted think So that's a on customers and for first will think who continue the number once access this had the on those a to interacted of application, to wake I Program meeting. our last grant system have that ACR they that year. have of with And a available. been commercially

a of mean think that's question the of sequencing out the have I company. the question. whether we partnership I On with not could

pathology. a where drive imagine digital to to that it situation might win-win there's profiling spatial world increased penetrated you existing has hasn't the think I markets sequencing utilization between sequencers us like drive into substantially and of potential the sequencing

So there. I one. need for don't we think be That opportunity said, partnership a may an there being

will sales existing fully is things accounts. And force biomarker call capable and great basic we do those own. of reaching and with translational Our can our out going oriented what this research I or research product on

Catherine Schulte

moving in system. than Make on through, an you're Do sense. impact regards utilization habits to markets have oncology? use then, on different those right. does per customers thoughts pull And that have non-oncology in into more your All as

Brad Gray

sample not samples limited limited. limited is, run a are for say blood is there Obviously, And were different trial as the a people have you models sense the think you model clinical preclinical you -- as humans you a number is number xenograft hard early come number most right? rather think. other of might those number of mouse samples the the I whether of limited, are who Neurology patients it's is or done patients by little and there's market patterns. much research is hand nature than us that diseases a enroll imagine by. to Immunology mice a less on impacted. of the also of sample neurology the large in It is might of to Most cancer on study. immunology utilization able in in the to

on XXX mostly with will So I at areas, a that if a in it will this I'm different positive Even we're handicap will take systems in these it be is position and negative being a a while it base to impact how culture. placed that meaningful -- don't or will instrument before sure different. it know play time. that new out our installed materially exactly it has

Catherine Schulte

in ATM for the year-end What's for your and capital then are think in And Okay. just do credit in XXXX? facility cash last sufficient one guidance you needs assumption me. for

Tom Bailey

Yes.

I So so forward for hopefully to cash terms about our million at Catherine, you as the year. to $XX chance last -- the get use and soon this guidance a same given look $XX we expected had the in of of is meeting Tom we year million

those very I will I in capital creative that that look ATM put including similar year-end comfortable would discussion, I have potential be so with the done options mentioned the in And it of had like in comfortable to look safe that top we'll things, say lamp we particular, variety cash very think planning for partnerships of we've with on I for Brad got that that you ones at about for of plus operations and the with year. think process this evaluating plan. that it as think said respect resources But number to support be would when it as of part the the and the -- year, future. at the to the this cash with support our a we've two past think facility XXXX ones credit think in we that feel the as the the to When we as you feel sufficient be

Catherine Schulte

Thanks Okay. guys.

Operator

And question Stanley. Steve comes Morgan Beuchaw our next with from

now is open. line Your

Steve Beuchaw

for Well, little all, me give to a for to you Brad. Tom it and for bit up you call. Thanks having first love here. I'd the afternoon. Hi, good on of chance. one Tom welcome one I have a for open and

interesting to company. demand a and be how have for grasp of you on changing And for and thinking of of can the sense forecasting thinking might how points there you after interesting start a how hear how view Did a you've company, what maybe have want the to just investors can get about of function help role then there deeper one background. about outlook for you're you're and dynamics? you I'd the the that. play Given to thinking this planning seen I about Brad changing what orthogonal the prospects -- us you profile not number in a give that lot not it us about that the you're for in but talk terms

Tom Bailey

Sure. to Steve. Thanks. meeting forward well, And look as too you

have the here. team the thanks I've that think and to is in opening assembled my I given Jim here I'll something to me important discovered predecessor Johnson, to didn't and script you've eight opportunity that use think I say in he's my this first weeks. my offer I some So

very jobs a larger here to information they probably team on of much in hours to this audit the personally terrific incredibly crunch that whom systems and constructed well with fact observed here many everything and the and and really rapidly organizations size, I the team access the for to their I've and seamless. has know left with And we everything shape and the long have say addition listening in in of year. consistent could get up Jim day working experienced NanoString's what company are controls been think processes, speed rapid at to a I I are call, and a I assure

I a patience folks listening and So me great thanks start with prudence today. everyone's appreciate for and are

your question So to outlook. about more and forecasting specifically

company in accuracy our what funnel. change processes and new think and with much budgeting I here and with from wouldn't I've I our our being it and too the commercial assessment robust our for the team of overall process of our observations. members a the our and seamlessly respect assess with size working improve team early leadership from directly forecasting Chad's seen are of everyday to process very finance and the to

good and also and the risks. ago think for a that I our our a as outlook our and that that assessing part for opportunities some perspectives reflected in when confident at few gave that building whole, I'm we this we've process of we laid as of stage see out minutes So you a outlook have

the we a a forecast profile and we I to chance reasonable think So range. philosophical to can but I call more have and might realistic feel can development think of to confident a be what exceed. that balance a meet important reasonable we philosophy that or establish I conservatism with stage with as changes differences is approach revenue company the NanoString's and We

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the that a established size. but for of We we've our So feel the that acknowledges range. that forecasting and can comfortable meet business stage risks business we

to like CFOs think inform you a backdrop average So detail time to as Steve you thing is, additional I philosophical bit bit other or from provide and over of that might find that's everyone's more might guidance edge that other results and that me, data others of and might and in what on forward the that as business on a of I as saw a forecast a future further the compared feedback bit bit have might we results you the outlook calls. or a on getting And to expenses. today or yours assessing look perspective given be detail with helpful in I here our

Steve Beuchaw

line Brad could product a I new PCR. And whether product for as One in that where because of use that. think lab someone some panels meets NanoString the talked nCounter the lot are decision the of whether in evolution, experiments. thinking asked where someone I run lab that appreciate going wonder the questions. in about really about are panel it make technology to of is, I road to Brad, when question they lot I to take maybe the the if or the the about proposition company really the rubber the a into and has some take of smaller you thanks. of a they can as nCounter the actually the the ended offerings and you ways who's there your of the right Well, respin different from remarks continue different because perspective you a rather I use ask open prepared for

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Brad Gray

they things we Yes. for really they technology. products. virtues the about three of When there's our customers the to highlight why love our to talk opportunity Thanks espouse

in And strategy run things like technology. to ability experiment. their result meaning And question of bunch and we've the army fast is have system to our do they and speed, the The value which a own a three Those we've people. well. value so own built the to from it's sort bio-pharma of design academic you ask which other have Simplicity an of scientific when all they'd will researchers and third of and can efficiently out first go experiment whole world quickly private what means go that's by extremely and see the to independent that is their data publish our that's they analyze that content, them that informed don't proposition or are experts that. full a a bioinformatics they're anticipated as and panel on this tool going a that, of

is instance, and with samples So with -- we've efficiency. they the researchers turn incredible a immunology offer cartridge offering genes run as pipetting nCounter immunology, to go simple able same can. do need and ask of undertake a and can XX a constant with an at be to by them -- that true who questions process we when on instrument of with may workflow same be way can when The they tried field look of for The that one role neurology that and understand thinking into themselves, want true actually qPCR fast the operate so where customer, we is panel that type is the of neurodegenerative they content to is along delivers samples what they on when role as disease papers the by inflammatory in or and that into a state-of-the-art the immune probably systems that neurology. all to anticipates lot do XX time spending one steps they to XX we to samples frustrated a by

NanoString, did out question? these and years in And people use to the be so competition. technology. say basis our at new your why to often to try the we we answer to communicating It's going our for effectively is So simple I critical Steve, many ahead. efficiently the that success markets

Steve Beuchaw

Brad. Thanks,

mute. was I on Sorry,

Brad Gray

on were we wondering was I Okay. mute.

Okay.

Operator

question Paul Janney next Knight with from Our comes Montgomery. Instructions] [Operator

line now is Your open.

Unidentified Analyst

question. color some for on is the Knight. more the Thank Hi. well, [indiscernible] your market conditions and while beyond for Paul instrument taking wondering, provide This Prosigna? are can you I Tom, on you actually they was sales, if

Tom Bailey

Europe with was and And in Europe and market a in for I'd the question. to very Europe. for APAC instrument been a strong particular in for Great. QX Americas Thank the is, good growth has us in outlook sales solid, relative quarter in say us remains the good you Europe actually were strong.

Unidentified Analyst

reps how restructuring, then, Okay. into this and And are after force on count your you later expand your especially is sales you to into consumables going head DSP of the distributed launch what going they field current sales are year? Prosigna and

Brad Gray

Yes.

force a on focused life two our and our basic divided then So diagnostic smaller maybe on products, more much is quarters force the are sales the the XXX focuses products groups. consumables, in Prosigna. namely into One or people our on And science people we and three focuses that instruments XX% life that today I'd sciences have say field. in approximately the diagnostics. of field on balance Probably and

reps. is So in roles, XX XX the have have about think newly today of maybe have reps. But been business for we XX the our field it's and to and regional life past traditional in rep created would those who manager the comprised a a instrumentation. based we've a Then, worldwide we on those And in-charge call base increasingly focused one consumable sciences that entire role reps account we side, is group four within or different territory. field three between I of today XX -- of

supporting XX group inside who with experimental an then focused XX are who sales et up focused are cetera about And that of largely to customers consumables. organization that's specialists we balance. have another application design have We on makes and on the

pure our at the we new So explain the specialists and and think design that to enter we substantially we it so not will need of are additional What customers this as will launch, capacity on have DSP need application we experiments force. to we expand some the that margin as help into our sales technology forth. to we who need to we us sales most

Most capable Access focus than without average of we're happen Early fully force underway need and the way. be our rather launch that's And be so of that rep material that any investment to will capable actually investment will technically year than XXXX people be. of the this in more the the your in those will really sales XXXX where will because expand

So expand we do XXXX meaningfully. not force have to the plans during

Unidentified Analyst

color. you so for Thank the Okay. much

Operator

time, I'm I'd this back showing to for the turn At call no remarks. like over the questions. to further company closing

Doug Farrell

today. us joining for you Thank good. Very

If did a replay available. any the portion To dial is you there access replay XXX-XXX-XXXX. call, please of miss the

If you off are ID in of calling look for The please week. call we will conference Thanks. XXX-XXX-XXXX. is that dial in next XXXXXXX. many and forward sign same, both the you seeing With to internationally Cowen

Operator

participation conclude program. for today's Ladies and your gentlemen, does in This thank you conference. the

disconnect. a great may day. You have now Everyone

NanoString (NSTG) 7 Mar 182017 Q4 Earnings call transcript