QTNT - Earnings call transcript Q2 2021

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Operator

Greetings and welcome to the Quotient Limited Second Quarter Fiscal Year 2021 Financial Results Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions].

As a reminder, this conference is being recorded. turn over to Mr. your like now the to conference host I'd Buhler, Quotient for Financial Peter Officer Limited. Chief you. Thank

You may begin.

Peter Buhler

Thank you, of conference call Daryll. Quotient's for to Good our morning, everyone, second quarter fiscal XXXX. and year welcome earnings

today will conference is webcast be today Today's and available me of an of replay www.quotientbd.com. live call is Executive later being Chief Joining Officer Walt, the Quotient. the through broadcast audio Franz conference at call

results as and making be development forward-looking including to will future Because Quotient projections operating results may timelines. with call, this commercialization those differ During deal materially statements. forward-looking future expected the actual guidance and statements statements from and such in projected events,

be Securities this morning's actual as Additional to the from in differ this found today's information and update assumes valid well turn projections filings as forward-looking are only materially Franz to The can provided and in the forward-looking in the call statements. of these obligation with Exchange factors concerning during no would Quotient's With could Commission, Executive US that, cause over including statements, results as like guidance Walt. Officer, Chief those release. statements I Quotient that to call, to and Quotient's date publicly forward-looking

Franz Walt

Since Thanks, the months were the Quotient we Peter. challenging team morning, And past good everyone. for spoke, last couple of and management.

under workarounds continue areas company, which the and of require difficult all, of different adapt COVID-XX have we and to in First circumstances. find infections several us very

employees we to UK, way and evolving customers. local Secondly, sites Switzerland, we trial US, national since we requirements. our lockdowns with sites, have and of government-imposed and restrictions had adversities Field navigate based affecting have our form regulations external through in Europe, the in and had throughout the and

to proud really if took very I'm will on situation, everything report I'm on than this the planned, our who could little as on release I that entire have to even made since on expected. team areas. unprecedented earnings a the execution last bit focus focused circumstances, we we I'm time several of Quotient despite proud difficult we ago. be progress happy and continued more progress this months Given three

antibody and and initiatives. Our corporate the our development readiness, commercial COVID-XX microarray, MosaiQ advancement pipeline finally, diagnostics transfusion MosaiQ of

me use power the microarray. you and weeks generated to a this all MosaiQ with platform. with innovative on first and few for FDA Let CE authorization would granted a and FDA. high-performance The emergency May interest emergency start like of use antibody antibody X. On XX, test we X, September test request I was first flexibility COVID-XX demonstrates our customers. that the within authorization Marked the we was remind by May foremost the This and test antibody COVID-XX developed on quickly submitted MosaiQ XXXX our

significantly embracing this are versus proof sign answered through we as it was to had we QX. several have point contracts. review were close remained than customers the made that FDA only in reviews. QX I this I willing tremendous, During technology rounds process had the but to sales, process, as a the a of in and confidence also not FDA is and to at the expected great FDA We that workload always. process see FDA review and several software. the swiftly The the now although Sales which customers and But review the Europe. new were questions contracts longer future gives took it the and $X.X the to EUA, technology our are sign instrument the and able but US with also me with microarray, low million they assumed increased in this

blood screen search antibody COVID-XX our very plasma We donor. who system Northwest, with microarray collaboration uses MosaiQ Bloodworks to the for in pleased donations and convalescent with are MosaiQ

On testing. the the on focus as so is market in far virus side, clearly we other observe demand Europe limited

believe customers, benefit we such gain placements be once will our that will positioned However, And value we trend. antibody from in still testing a importance vaccines to high available. in become with

of donor staff MosaiQ COVID-XX organization this, microarray With as rollout say opportunity is and our technical test install well instruments, excellent ready that as commercial of an to our needed. readiness launch the prepared train as to in Finally, antibody lab for effectively few that commercial months a was can from the provide We demonstrated into safely support. organization, are support confusion we labs a the now. continuous we

where MosaiQ our to by move on progress immunohematology The our in impacted program pipeline recently of the second pandemic was advancement able now to the of transfusion development our were Europe. pipeline in expanded diagnostics me we coronavirus wave Let Europe. trial field the make significant as

Kingdom now we will It results in Here, United expecting be since were a in is our pandemic. to related to subject to located again take October. restrictions the last the longer testing site available little

expect we in month you However, its this results update. the will as hear

remind fashion that Let currently can microarray anything Expanded more our than me it you do of else on or tested tests manually. the market, normally on the knocked which proposition rare IH in is antigens, either including value that are an automated

intensive also rare to manual reduce employees field number of part of time to trial number on And as material. consuming on of and the often very is this perform sample we is time to testing. the pandemic consuming response. to to this had manual test, intensive comparing the And testing, which had versus get competitive more an time impact the do. for Due the labor it customer their have For are size and sites difficult ability their pandemic,

the with are we testing, the good with of will the termination replied that field beginning At continued Our gives from results. announced SBS process. Ortho. Right confidence communicated questions signing received to year. of the end previous of arrangement FDA. we agreement previously confirms the the September, arbitration questions trial the as now, calendar internal continue the us outstanding before the It of of We and to provide however, SBS ended there letter Initial no XXX(k) approval. XXX(k) and approval the all us expect applied a

while were are and transfusion we the this for agreement FDA related a file gives in to removes task clearly time to in a and for segment terms microarray hold and saves risk, will all between could MosaiQ very the two transfusion not sets money Although us rights arbitration, us will relieved access develop Europe we global by outcome confusion ourselves. for approval. letter market and as US. also MosaiQ Mark rights groups. donor to it and we divides Quotient exclusive the US market, collaboration confident the new The access Quotient immunohematology CE market patient the the for and market the patient maintains prevail

the a will transfer will price that sell microarray We fair margin. generate the at gross

detail diagnostics was to after achievement respectively sheet the convinced in the nobody In after payments in equity of Ortho we glad the approval upon this. Ortho, on by that the addition, a much that global performance of hear election race. as with antibody US with confidence and Last, for develop non-refundable I'm looking thought milestone $X.X not Quotient XXXX. to the existence our for Peter collaborating since Peter's COVID-XX. up would existing the that, but business the the balance inside business have are and of Exclusivity into In certain in see will to to $XX.X wave will second highest the update. first Ortho timing US. with we how horizon very million with this Ortho market. the the pandemic, in We long amount COVID-XX our year-over-year September combination an commercial additional I the months cash, few million despite this regulatory to bring to the least, more next it successfully in sales of continuous QX payment back Europe, obtaining revenues could with we company. the a like you milestone announcement, forward regulatory and Shortly delivered sales turn strong years of And the the financial and leader it remarks. benchmarks. conquer a of right to transfusion transfusion deliver be with I'm Alba in still is With Quotient test in safety and entitled paid double-digit global Quotient quarterly hard would given patient growth foresee strengthened to Ortho milestone, about commercialization. the XX in With

Peter Buhler

while increase sales quarter XX%. are increased year's an Franz. Sales first by reported sales for increase in quarter from in first OEM last Alba direct sales we quarter year-over-year million increased tests to a XX%. by COVID-XX for the MosaiQ the to in at Sales $X.X first year. With were product of the million, $X particularly of X%, increase sales you, million, of US. fiscal XX% sales, antibody of customers to Thank compared Quotient a customers $X.X OEM see $X.X current Fiscal million quarter. the reached strong the quarter by

the Ortho to are for include price the prior the year was restrictions. sales related The quarter. Total Diagnostics. and upfront XX% total from revenues to first revenues the second compared year standing year, first the improvement to year Clinical last product revenues is margin to half half financial milestone quarter the versus increased pandemic-related year, in versus XX%. in total Gross while first on previous by XX.X% year product XX.X% Total versus received increased primarily product increases, our sales of mix XX.X% the product by increased last XXX% improve related For quarter used relief of XX%. improvement by and quarter payment is of sales million versus XXXX the orders. while $X.X

insurance of on half reached year. costs expense the with foreign net and $XXX,XXX million, XXXX. $X.X gain million expense first interest $X.X loss XX%, half the the were other and and decrease and The year-over-year we to to quarter $X.X million $X.XX million, prior Research an increased $X [indiscernible] of $X IH the in the quarter interest $XX.X or operating or $X.X the decrease first million XXXX. consisted of first million $X.X ordinary half of recorded by of was of $XX.X expense million expenses year. million share lower were an depreciation for and over versus the million, charges, compared includes the million, million loss Overall, a previous $X.XX compensation stock administrative quarter versus second second arbitration $XX.X marketing million prior-year was depreciation quarter, was $X.X fiscal $X fiscal year, million of from Operating year. were $X $XX.X related per $XX increase were significantly expense Net prior $XX.X compared the $XX.X costs first Sales the which million In the G&A development to amortization of million. million in foreign year, year the additional and our $X.X the $X.X million trial with year. in million with cost. exchange gross an share line costs. margin million loss $XX operating of For in quarter. million driven Net year sales field of is cost by last increase depreciation $X.X the second increased loss was legal in increased other In XXXX. to of prior were and million XX% last XXXX, $X.X compared in million in exchange compared half while In the in per million ordinary second Ortho to for expense, year. offset expense quarter with fiscal the second General it fully $X.X product depreciated. due in quarter, compared second expense with

working a with with fiscal $X.XX the first $XX.X Ortho of net use For the in Net cash per of XXXX. increase $XX.X in year, ago. was fiscal the year of XXXX totaled in $X.X million improved half million million $XX.X second capital. compared $X.XX fiscal upfront the to during with reached quarter milestone million operating Capital versus first or significantly million prior per the in $XX.X first expenditures share share in lower half the $X.X combined The XXXX activities or cash one used half loss million due of year. compared

of in total first the The million fiscal $X.X the year, For our MosaiQ quarter CapEx instruments. $X.X the was majority CapEx year. relate to to of compared acquisition of million in the prior second XXXX half

accounts additional the million million the net short-term facility diagnostic its at to might and Moving cash the April XXXX. in our well and $XX.X With cash MosaiQ. additional have financially this new other debt in and [XXXX] to of We while was balance one cash company trade due is XXXX, million, delay an inflows on to changes Eysins reaction the reserve phase timing reimbursement XX, until options equipped multiple substantial are raised very prior The receivable million strong and outstanding the September closed of the positive hours. compared million combined and payments, from restricted now our XXXX terms generated March compared explore related September in raised million MosaiQ. additional end million. of to into sheet. within facility in totaled million. the of few held XX, total available $XXX sale of successfully $XX.X cash existing and accounts last of XXXX. commercial related proposition increased receivable to customer or with $XXX.X investments the to oversubscription the development under a equity ago With $X.X a the phase. the items and $XX.X inventory receivable The our restructure public million At with company end equity sheet year lease. accounts $XXX.X has of reimbursement September of resulted enter and In inventory $XXX years, An increase we of is Off-balance (sic) decreased first at sheet the to from finalize is and debt revenues, of totaled offering. balance of proceeds is while fiscal transfusion $X The shareholders largely We accounts in to year. of borrowing compared

guidance. Moving to

$XX For our revenues Quotient fiscal No other by full reagents of for $XX million. reconfirm further million related the XXXX, year are range in to our product revenue of Alba milestones we expected. sales

by and quarter third the reagents Quotient we $X.X expect XXXX, between For fiscal of million of million. sales Alba $X.X

used reconfirm our million, that, With range in also now to $XX month. over million me expenditures let to forecast operations turn Farrell, approximately per the the of Chief to in for call cash $X the capital We million Operating million Ed of $X $X and Officer.

Ed Farrell

Thank you, Peter.

to release next start, as like following. first applications. transfusion plans are the the would I antibody by any now, the and offerings. as opportunity antibody not referred, semi-quantitative followed potential and a we European will further we is new the received market sample This the forward We in In amount stage, to will The of clinical if step level release available. sample At the and the semi antibodies will and COVID-XX MosaiQ's determination additions the this Europe, not of expected FDA of a upcoming The MosaiQ share test EUA an do neutralizing semi-quantitative next update market tests for Looking support the plan MosaiQ diagnostics few a our demand COVID-XX help quantitative of our microarray our for on test. new will in steps see is vaccines allow next guidance. our to finally present To to be to software. in COVID-XX generate weeks. determine require microarray, test become but antibody an

continue to our strategy, We offering market. to to on comprehensive is transfusion focus diagnostics a bring the product which core

trial data, submission in or calendar of we subject will XXXX. execute quarter a of SDS, is, end approval plan first XXXX. to we the are field the resulted by mentioned, sites Nevertheless, has wave lockdown. followed progressing restrictions a CE previously This as year submit microarray. continue calendar end On finalizing the the the government-imposed trial risk second CE second pandemic, of Expanded which and is the R&D course, to the quarter around we a due for for V&V in trials plan Mark Mark inherent despite of to year, the of report UK IH our development reconfirm the of of slowdown third As by the and our Expanded CE the Mark the field to in

commercial whole organization the as Mark to Our obtained. ready is is go CE as soon

identify tenders. XXXX. to internal QX databases available We to upcoming as According are tenders calendar as of our become estimate, several constantly year soon available should reviewing

which Regarding product. already existing incremental development donor started the AFL the patient development immunohematology microarray, is the have immunohematology we over an

to additional of so the We of QX process can beginning planned at next XXXX the in steps year are the are our filing in XXXX. In or Expanded commence December regulatory of XXXX. resources, trials These we hiring meet of field are calendar calendar year planned the IH. for in US,

restrictions Our the continue remain conduct of on to separate In Initial will facilitate at the pace number in labs independently US. able if order would a trials. even to three Europe to hired and we allowing between trial run situation the in US the is the additional small field this, plan place. travel US XXX(k) dependent sites us Europe the SBS across from to to and be of in pandemic testing approval. US, The being perform resources

Franz earlier, the calendar FDA end approval the instrument. questions As the MosaiQ cover approval and The of answered year. we will the the both mentioned microarray all from the before anticipate and

the US wait launch we remind we you IH Expanded that have me fully available. Let microarray in will the to until

be feedback. products technology use However, the and future customers to able us with for XXX(k), the use our valuable experience and research will give

you are and are we disease planned encouraging parallel know, As very as we see to in on progressing working continue And molecular screening. performance.

update call. during the at our latest We earnings year give an full will

products products diagnostics has milestones always [Technical discussions remarks identified by and bring about potential MosaiQ and US upcoming designed This specifically diagnostic ongoing operational the the major potential MosaiQ regulatory commercial the a potential benefits knew to This Franz. also beyond lab the was concludes are chain to technology we back I would and areas. for Difficulty] MosaiQ to system on technical Finally, diagnostics. in to other and new like and of hand market leverage my transfusion

Franz Walt

Ed. you, Thank

very financed. have are you we well heard, As

are the only are adversity hand over we open the few after to commercial programs like all going the making despite our situation. are a plan ahead Darryl launch With also I to Q&A We months to in session. years from would and facing pandemic this, away R&D the our due the of to

Operator

Instructions]. [Operator

Josh First question of with line the from Company. Cowen and comes Jennings

Josh Jennings

sales. are about today. to mentioned the for tenders that just of of can MosaiQ to XXXX. diagnostic detailed where share numbers you up street coming today, on there. CE MosaiQ any I and – the start revenue is Two, pace terms commentary Mark hoping you XQ you help Europe you is from for just any was fiscal about be high updates adoption for pace sit approval, transfusion after the a provide what high-level Thanks of sits help more provide was how just And of the just details can where Any get in funnel modeling just our in one. the the just in I today demand hoping that calendar can in really thinking side for can helpful. and – would developing we and level XXXX very it maybe can upon I'm

Ed Farrell

seen in To come point, are to have we Ed. some what tender process. Europe. account we of this the is starting are prepare the to any seeing that It's But for the market tenders not

– will starting rapid smaller those and expect a on larger we to during said, tenders the some had process more see there of the a tender of active process. What the and have from have see remarks, onwards. to shorter, countries some longer I some customers depending accounts, is those of we QX become As

we and tenders be So, you those to in those over will see that the see the tenders on months eligible active will of awarded. coming becoming and being receipt that will participate we Mark, CE

slow, through roll be So, we it see it will progress out. starts, but will up year. that it Once pick it as will they eventually the

Josh Jennings

manufacturing more that MosaiQ had STRATEC. this had think announced systems you from I partner, your earlier year ordered you

to may commercialization closer into head there add many have I as MosaiQ think XX of about how think XQ How this period in get MosaiQ XXXX? you was and should as into we systems to the inventory. order we you systems inventory counter plus

Franz Walt

over have And Those coming instruments other any inventory in us tender opportunities you're and Josh, will plus months. to the respond correct, well we weeks instruments. opportunities start the ordered XX that or very XX to any coming be months. received positioned that will to leave arise

have that respond dialogue of amount continuous we the also we instruments inventory. we So, right it. to manufacture need with the We're will they in STRATEC and ready feel who be as

about into very feel we as head confident inventory we next levels So, year. our

Josh Jennings

Mark for able commercial But they're currently commercial is little give team menu terms us have their on while. approval? Can MosaiQ system IH an share they of anything been can out building and of menu. for it already You limited approval Just are market and in has Europe, on the the team Are a you what Expanded you place there? how front how in just CE the activities update just with CE your in funnel? Mark demand that to

Ed Farrell

dialogue are with in constant they're Our in team the market. –

COVID-XX in those market up accounts. making sure interacting, shortly to are our We in real remind imminent service sales they're back about front the opportunity understanding those teams, team, said capabilities. practice support are has and the We're for MosaiQ center accounts' dialogue also team, the the the fact force, was or also commercial to our COVID-XX other entire ability to engineers, that team you real a press start, minds us commercial been likely the the commercial that's of on technical is they go the our opportunity tenders. keeping Franz we keeping and and support field tests tenders to with line what again ramp coming in for and when And when that that

Josh Jennings

understand how that helpful the question trial challenges help IHX and US just normalized the I Is be pace COVID matter tests the be understand quickly trials times, in run? and clock how weeks microarray. some a are there. just be field normal months? field of run Expanded might remember, I to COVID of run. data cause taking the And stop analyzed that then it running to long questions. that results could in a rate the think how But the and to could public. could think us and then But terms be US for clearly, we for the for the I last on trial the to get for of not or My it helpful understand menu the trials made field for be investors and to would Thanks the takes

Franz Walt

in circumstances, trial. terms the months for we In field of fields, normal were allowed three a to six

For that duration where comparator an limited the of amount very the a trial months. immunohematology three rush field comparator on trial And many of comparator there's amount sites of manual of by sets testing, and to the basis. field of difficult do daily a six it's significant this to that testing complexity to they the the can testing are

working as of inherent possible. is delays with smoothly there maintain risk executing will, situation US, we be not but everything COVID the field to we as that US resources timeline, – the do to it's minimize in the that We field but will we'll that the course develops we be now any trial clear focused in hard the And trial. US, on ground will on how can in the

Operator

from question next Ji BTIG. the comes Sung line with Our of Nam

Sung Ji Nam

you of the Or vaccines approval, how Is earlier asked follow-up available? contingent was process plays Europe. from can are out? question short pandemic the in about for in I do terms being the diagnostics transfusion think readiness start that is Josh your what a commercial fairly MosaiQ on first order? a you curious, assumptions once is there in it My what

Franz Walt

we is to that's we What That's we from and also deciding in. vaccines ready which organization go. technical hope restrictions on second that, that the to the be already also a a instruments commercial proven on to demand, XXXX. ordered have and various COVID-XX bit organization change. going we little I of is have not new tenders COVID-XX an have of semi-quantitative and is soon, working on the know will antibody restrictions They alluding coming as see, available, sincerely was – in now. flexible. quarter uptake one sorry, difficult clinical top February And guidance. visibility still laws have indeed we on the if guidance because That are are that plenty rollout. right to, speculate are expect we with to Ed are in the they we that of And as themselves we especially helping But And might up what in become

can If for is have so demand instruments, for comes. we place surge are us even So, very flexibility go in as play But it there can to uncertain a and tenders. testing, we the make difficult it the even we more antibody to for these very predictions. times

ready to We are go.

good trial We soon. expect IHX field data very the

submit. We will

environment years to do And and in a the and all to submitted. of tenders submission, sell. in should we need parts participate making, we're an months, ready we able But go. the to you combination actually that. have and We course, modular first as of the enabling us year, finally, the then. of hands powerful after get in our and we need end know, have before be a confident already been couple And are we

Sung Ji Nam

And a makes That of just sense. lot then a question. clarification

there be more convalescing US I less of will the in do terms versus demand are more Europe. US seeing with the available. and realize to in vaccines – antibody In But testing Europe. largely once Is that think that demand the so you're in testing

near-term, you visibility do what have believe, Just if be might what's might demand think with And customer given kind that. of I into also, any you to the I driving have contracts, curious a customer.

Franz Walt

circumstances no driver. protocol in Europe performed. the is and It's is there also But out. guidance That's as no issue be correctly other There convalescent pointed is this at in antibody point an countries time. in testing, should the you under some what

testing, then antigen because entire is there test, PCR clinically availability be the in focus with you in making we again, place maybe story. believe testing think this vaccines, now, testing. it. will on of with And is active I have But be of to that's why a active infection antibody sales with whether something antibody we able see an phase, lot should the speculated a right you this when do to an never different

everybody for be. technical technology. test organization, go? beginning, and some much and and And the know power was ready by us and But contracts was right to focusing think pretty mainly trials and the for We that, away, pay that our demonstrate the will clear technology of it customers were to of transfusion, to expect we we're this we was came going it commercial will it making was I it. showcase us, will also embraced course, So, to for alluding they Also, for it and contribution, new strategy. as were in the then a but are business they the flexibility field to really a we, meaningful question core be service stopped. how buy of COVID sign on don't But that uptake. to, to it's Ed also really around, we demonstrate because

it, organization. made test, an and technology the testing providing entire So, us antibody out the such we best showcasing of the

Sung Ji Nam

on you the as for mentioned that just to I focusing well and business. core alluded Ed you're diagnostics transfusion think me, Lastly, I think

you what rapidly wondering, opportunity term Do was even about fairly near given might that? You're platform? the develop COVID. for of testing testing sensitivity able to an take there your advantage the of antigen to in antibody I think be

Franz Walt

the on It's not menu.

test COVID we situation But are then this already being. developing think Farrell changing, be flexible. that for further was we can have the expressing time the planned. Unless I is we not not Ed

patient, near the believe testing really personally is technology, really I antigen close of point think care high our done to as as our testing throughput, PCR the kind of the are admin ideally, possible a be high should or manner. and patient of quantity, efficiency, for in high But selling centralized aspect a – solution it high I central is solution. automation a

Then you central to that's play. accurate the samples test, why is to And can our do should which also antigen send PCR if So, not an in test. test. really the do you less you lab, a PCR

there on anything on our you tests on transfusion. of strategy, we're would and we just on? antibody to is like that betting add we saw So, core antibody Ed, quantification testing focus

Ed Farrell

versus a It's Franz. I of care. No, think great point centralized that's summary,

antigen a And point most there's that do I to if do point to going of the on you're coming of care. likely want an going see test, now. of market to think antigen you care lot products it you're it's

Operator

Thank the no would you. for to to over comments. questions I for Walt at There further turn like closing time. this are back floor Franz

Franz Walt

And Yeah, fiscal have you of conference progress by we thank in on updating everybody, for you, to third us time to quarter Darryl. the call look the we made XXXX thank and very you our call. today forward expect much, the joining

thank the So, safe. All very you Stay best. much.

Operator

Thank you. does conclude today's This teleconference.

lines your your You may time. a And at this disconnect day. great Thank for participation. you have

Quotient (QTNTQ) 2 Nov 202021 Q2 Earnings call transcript