Q3 2020 Personalis Inc Earnings Call
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With an approximate value of up to $31 million, increasing the accumulative to date contracted value to approximately $175 million.
Our population sequencing business continues to be an important part of our groups.
If we combine our latest V E M. B P order with our Biopharma customer orders received through Q3, a year to date or 2020 order value amounts are already larger than the full year of 2019.
Okay, having a key facet of long term cancer care.
Her first like wood biopsy product tracks, the evolution of what can be hundreds or even thousands and cancer mutations and a single tumor.
And can detect new mutations as they emerge I'll get therapeutic pressure.
We'll also be applicable for the diagnostic market in the future.
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Okay.
In two three we continued to gain traction with biopharma customers and realized strong order levels once again.
You here today at the end of two 320 20 or Biopharma orders received we're almost twice the amount.
Is the year to date at the end of Q3 2019.
Utilizing our advanced proprietary new management analytics.
Drink Q3, we completed this initial project.
We were excited that the value of our platform is now being recognized in areas beyond cancer, which we believe provides us with future opportunities to expand our market.
Cohort commercialization, where he actively engaged with pharmaceutical companies in the drug discovery space, including leading G. M. I S collaboration with Abby.
Kevin's near term purposes on helping us penetrate new population sequencing customer accounts and we're thrilled to have him join us at the forefront in population genetics.
Our work with a V. A M V. P represents the largest population sequencing effort within the United States.
Because of their shared underlying technologies on operational implementation, we achieve considerable synergy between the two businesses.
The advanced our new address characterization capabilities.
Thank you John and good afternoon, everyone.
And some biotech customers continued to be impacted by the slowdown of clinical trials.
For the third quarter, the VA NBP revenue of $14.1 million was lower by 4% from last quarter and was 9% higher compared with $12.9 million for the same period of the prior year.
If you recall, we do not have specific testing turnaround times for the VA NBP. Therefore, we have the ability to modulate volume up or down to complement the biopharma sample testing volume, which is not linear.
In the third quarter, we did have more more biopharma samples on hand, and therefore, we processed fewer VA NBP samples than in the prior quarter.
Four 7.2 million in the third quarter compared with 5.3 million for the same period last year and SG&A expense was 7.8 million in the third quarter compared to 6.1 million for the same period last year.
The increase in R&D expense, what's your new product development and the increase in SG&A was for public company costs and continuing to enhance our infrastructure.
Net loss for the third quarter with $9.5 million compared with a net loss of six 9 million for the same period of the prior year. The net loss per share for the third quarter was 27 cents and the weighted average basic and diluted your account was 35.5 million compared with a net loss per share of 22 cents in a way.
Did average basically basic and diluted sure count of 31.1 million for the same period of the prior year.
Now under the balance sheet.
We exited the third quarter with a strong balance sheet with cash and short term investments of $206 $1 million.
Third quarter cash flow from operations with the usage of approximately 16 million, primarily due to the net loss and working capital needs.
During the quarter, we've raised approximately $117 million net of discounts fees and expenses from a follow on public equity offering to further strengthen our balance sheet and allow us to pursue many of the growth initiatives in front of us such as our liquid biopsy next personal test and.
Best thing in China.
Product development and operational capability for future F D a approved or cleared test.
Future capacity expansion and several more.
Given the number of initiatives, we are pursuing we expect R&D and other expenses to increase going forward.
Now I'd like to turn to guidance.
During our last conference call, we did not provide any 2020 revenue guidance due to the uncertainty from the pandemic.
And although we had another solid quarter of execution uncertainty still remains about whether or not work conditions for us our customers and suppliers will remain the same as today or change in the near future.
In the third quarter, we did see some supply chain shortage, you'll have items used in our laboratory such as consumable products, which are used by many labs, including those focused on COVID-19 testing.
We therefore remained somewhat cautious and our future outlook given this continuing uncertainty from the pandemic, especially as COVID-19 cases have surged recently.
Potential changes could have an adverse effect on our financial results and therefore, we are not providing revenue guidance for fiscal 2020 at this time, we plan to provide an update to this information during our next earnings call.
Now I will turn the call back over to the operator to begin to Q&A session.
Thank you so much.
I'm, Sorry reminder, to ask that question you will need to press the star than the number one on your telephone keypad again to ask a question you would need to press star than the number one on your telephone keypad.
Our first question will come from the line of Derek.
Really from Bank of America. The line is now open.
Hey cause I D. I don't forget it today. Thank you for taking my question.
So first question on.
Recovery that's still.
Of mine do you see any kidney.
Impact on oncology.
Get your daily taking.
Call it by now and.
The details on the ship to supply to I'm trying to get.
Justin.
Alright.
Okay. This is Shaun alright, thanks, very much for the questions. So in terms of oncology volumes you may recall most of our oncology business is in retrospective analysis of samples and so I think where perhaps impact is less than people, who they work more perspective testing, we do have some prospective person and sort of that.
Has been.
Wrote down some we also have some customers that'll have difficulty collecting samples we have a biobank customer is that right.
<unk> commented in prior quarters has been really quite substantially reduced because of problems store too covid. So the the growth that we've experienced so it's really been in spite of those slowdowns. It hasn't caused us to have get them any of that that revenue that I'd say in terms of the <unk>.
Supply shortages.
It's probably been able to manage for that but the <unk>. The corona virus isn't RNA virus and so many of the reagents that are used for testing of the Corona virus specially specific to RNA. Because we also process arnez part of our platform we have to make sure that we have sufficient supply of those so far that.
Husband's gonna a major problem for us, but it is something we're keeping an eye on.
Great. Thank you John and they know that question on that link without seat pipeline.
So I did have a bed, but I'm wondering if you could give us an update on.
Potentially timeline for taking that pipeline internet connection.
Okay, that's been getting a lot of electric question contact.
Sure great. So in the liquid biopsy site Ah current liquid biopsies product was really designed for work with pharmaceutical companies and is not currently.
A clinical diagnostic product it's really.
Comprehensively understanding pillows or changes over time.
Cynical clinical trials and stuff.
Do you anticipate that it will be analyzing samples from clinical trials, most likely most of them will be a retrospective to start with all of those.
Time that probably will also include a perspective and also sign up for trial.
Samples, we have not announced anytime line.
With a biopsy done to be a clinical diagnostic test outside appointment at this point.
Great. Thank you kind of kind of.
Okay. Thank you.
Thank you. Our next question will come from the lineup dog from.
From call with the line is now open.
Hey, good afternoon, guys Uhm first just a quick one on M V. P of it and I got a broader popcorn program first is the V. A you know kind of open for business when it comes to blood collection.
And then you know more broadly have discussions with other popcorn program started to come to normalize or pick up again or is that still a bit hampered by what's going on with COVID-19.
Great. So the citizens John.
Alright.
I'm sorry, the day, if I could currently not collecting samples successful people, who sign up for the program online in general, but I know, there's blood samples coming in on the other hand.
Yeah. It is already collected blood samples from over 825000.
And the total of all the orders you've ever received.
He was about $146. So those over 700000 samples that they have received that they have contracted with other breaking up so you have a collection, but the day or night.
In terms of the the scale of the business day.
I would say the operation of their lives I was considered level.
Mhm sorry.
Saint John's try and get disconnected.
Card Lang can you please take over.
Yes, we can move on to the.
The next question and Aaron can.
And Doug This is Caroline again, Unfortunately, I think Aaron has dropped as well we will have our longest guy he is sorry.
Sorry, I am yeah I. He is dialing back in right now I am so sorry, and I'm sure that John does have an opinion on the question you just asked but if you could just give us a 20 seconds.
We should get more yeah allergies for they are of course no.
I think we all understand in this Ah given whats going on these things happen. So we'll we'll hang tight.
Hello.
Hi, Aaron.
This is John Lewis well.
Hi, John.
Hi, I just the way it was halfway through answering a question on the line disconnected I don't know if we saw people on the line and yes, we do we do Doug If you could just maybe ask your question you know have John Thank you.
Oh, Yes, Hey, John.
Hi.
Oh no no no no problem at all as over there and I think we all we all understand given given kind of royalty on those from different areas. So I.
I actually just wanted to talk about something that.
What specifically directed at you just given your unique experience and perspective on that and it's really just on the topic of.
Proteomics and Multiomics really.
You guys were an early leader in providing multifamily multiomics solutions to pharmaceutical partners and biotech.
As I'm sure you appreciate there is a number of emerging and exciting technologies.
That should enable biopharmaceutical companies as well as academic researchers to do more in proteomics in a way they haven't in the past and hopefully and eventually advance Multiomics assessment, both bird drug development as well as research purposes. I'm. Just wondering if you view these as complimentary or competitive or.
You know again, maybe it's a bit of both and hopefully just given how early stage. It is maybe it's just ultimately good for the category, which is good for personality I just love to get your thoughts on all of this.
Yes, so personnel costs has been making our platform more and more comprehensive as we've gone along the way.
It began with DNA, we added our M&A, we've added T cell repertoire b cell repertoire. So for US we've added a lot of viruses. So we've added on additional elements of biology over time.
We if that uses additional tools, whether those are different kinds of sample prep or different kinds of instruments. Those are all sensible for us. So we would look at it even straightforward kinds of proteomics with.
Immunohistochemistry as being sensible add ons for us to the extent that there are more advanced technologies in those areas that leverage mass spectrometry or other things those are certainly things, we're comfortable with our own.
Neoantigen developments of leveraged very high end mass spectrometry. So it's an area we're familiar with.
We don't currently offer that we haven't.
Announced plans in that direction, but for sales is really interested in the most comprehensive characterization that weekend.
Provide for pharmaceutical customers and so as we look at these additional technologies.
There certainly is the potential for personnel broadening out further to include.
Other types of the Alex.
From a throughput sandpiper from a quality control standpoint, so yeah, I think it's kind of an exciting time for us.
Okay. Thanks again.
Thank you.
Our next question will come from the line of pass solvent from Morgan Stanley. The line is now open.
Hey, guys and then again for attention and thank you for the time and taking the questions Ah apologies that you guys a call earlier, but I've been hopping around on calls and just a bit of a beginning but could you provide us with some early of color on Jacksonville. Your next liquid I'll see I think can you tell us like with some of your <unk>.
Neutral colors are looking like the size and.
I guess is there any way supposed to parse out like the impact of having this new capabilities such as like maybe a new business wins, driven by the offering and of the customers who I've ordered it like what percent are current customers versus Duke.
Yeah. So this is johns as you would expect some of the people who are <unk>.
Engaging with us the most rapidly on that our existing customers. They tend to be people, who are already using our next platform for tissue samples and then they often want to follow that up with analysis of.
Liquid biopsy samples that additional time points I think it's.
Yeah, it's kind of a new offering because of the comprehensiveness of at most other liquid biopsy uhm products that are offered today cut.
Cover perhaps less than 100 genes or perhaps a few James so the fact that we're looking at all 20000, James just really quite new for people and they are beginning to look at.
What kinds of samples where they learn the most from what to have that certainly we've seen customers. Those are all pharmaceutical customers, who you can see people really appreciate the fact that instead of essentially looking for your keys under the lamppost, where you've already been looking for a long time, Kevin unbiased view across the whole.
Instead of human James to understand what biology is changing as tumors evolve and so I think that there is an appreciation for that.
Because it's somewhat knew we anticipate that this will be started with a set of pilot studies and that's the kind of engagement, what you're saying so far but I think as people start working with the technology and seeing what's possible with it we anticipate that the scale may grow as we go through 20th 21, So I think of 21.
As being kind of.
Trying it auto piloting you're in probably the.
Larger ramp will be at 2022 timeframe, but there's definitely interested in the classroom.
Got it. Thank you that's very helpful. In terms of the piloting things that you mentioned can if we thought about it as maybe the same trajectory or the the the cadence of your eighth two next platform transition would it be fair to say it should take about the same amount of time or maybe you can maybe it'll be even a little fast for the time around.
I'd say, it's it it is a little hard to say it it's probably more different the platform. We had before next I'll also looked at 20000 dreams on tissue, although it did not have the capability to.
And the immune system I think that they're looking at this from a liquid biopsy standpoint is a more significant change for people and so that would surprise me if it if it didn't take some time I think this is what we've said all along is that we expect 2020 wanted to be the period of time when people are doing pilots and testing and so forth and you know perhaps.
Absolutely 21 is a 22 is when we might think about saying larger scale project. So it could be a surprise surprise by that because there has been quite a bit of interest, but you know I think we're just being careful to make sure that we represent possible properly what the product can do and you know get data into People's hands. So they can access that and.
And I decided you know, what's the best place to use them.
Got it thank you and I'm trying to your development efforts in China really quickly can you provide us with a little bit of color on how that is progressing and I know you guys have mentioned that.
The reason for starting this all it was because of the high demand for global apartment customers that makes me think that you guys will have some sort of visibility into.
Order placement or capacity utilization like can you help with the pain that and on similar thoughts you guys. I've mentioned, I guess cost renting from studying and stuff and I guess that a G. M headwinds in 2021, so how should we think about that.
Oh, such a I'm happy with how it's progressing we do have our first employee there were building out the laboratory. We're in the process of doing recruiting so that'll lead to a broader group of employees. There. We've also been engaging with a fair number of pharmaceutical companies, who are the people who actually initially asked us to expand into <unk>.
Kinda and there's definitely.
Interest in that the pharmaceutical companies themselves have to go through the regulatory process not only with the Chinese F. D. A but also there's a regulatory agency called H, Iraq H E. R. I C and there's still a bit of a new process. So we're working side by side with them on what the best way to go about that is and how to be risk.
<unk> the rules that exist in in China, and and to work while they're so I think there's we see this is something where will our first revenues will happen in 2021 in China with the real ramp up there being in 2022, but it is I I would say that we probably have a second.
Benefit from this is that the large pharmaceutical company that you work with are typically are working a real literally around the globe as they've seen the seriousness of I was taking this on People's got really engaged in that and I think that's also helped us to win business outside of China, because people can say that personality ultimately will be in a position to.
Across the samples from anywhere in the world and so that's that's not that common of a capability and particularly with a kind of platform. We have so I think it's going to help us not only from revenue that we see from China itself, but also with revenue from outside China.
Got it thank you guys very much.
[laughter] well thank you.
Our next question will come from the line of Kevin that together from Oppenheimer Linus now open.
Great Yeah, Thanks for taking taking my questions Uhm.
Kevin.
Alright, thanks for taking questions on.
I guess population can you just talk to a little bit of how you would think about the current.
Sales funnel you know you kind of have described.
Arrange here.
Ways for going at that market from kind of larger contracts to kind of you know more more service models could you help us kind of characterize what the totality of that.
Sales final.
Looks like and what it may take a mature of that.
Yeah, sorry that this is try I think they.
And we have identified a pretty substantial number of projects over 100 different projects that about announced on way or another at.
Not all of them will be applicable for us, but I would say that in addition to broadening out to additional projects, which are perhaps in the same old as the channel of England and programs like that that sort of country based research style projects.
You say that as we're having intellectual discussions with with books that they there is an interest in involving pharma and there's definitely an interesting having this be clinical sooner rather than later in the clinical aspect is interesting because it's not all a the the you know the diagnostic angle on it but it's also the oncology tangles. So.
As in the past population sequencing, mostly it was whole genome sequencing of Germline gene arms from blood samples as you start saying this really needs to be genomics being implemented in the health care system. So these countries. Then you say well what are the biggest applications for furniture that looks like that's actually cancer is one of them and so people don't want.
To start with essentially a backwards looking approach where they're just looking at targeted therapies I think there's a lot of understanding of the importance of immunotherapy and if you're gonna build genomics infrastructure for the future in your country.
You want to be forward looking and saying.
What are the Biomarkers, we're gonna need to be able to look at in the future not just sort of what have we used in the past and so the 20000 Jane platform from a diagnostic standpoint, where it's comprehensive and is looking not only at the at the the tumor but also the immune system.
I think people see the value in that and so that's a that's a component of these discussions as well I think it will take time to resolve that in a way there haven't really been many other companies.
Pursuing population shake punching other than just disappear sequencing effort.
And so I think we'll be working with these customers to say what are you really want us to be in the future.
And as I say I I I think it will shift from being purely research to something that involves clinical diagnostics and through that uhm oncology.
That's very helpful and then it sort of a separate question.
You earlier to share really you know before the onset of covered and we talked a bit more about the opportunities for the guard to pharma companies too.
You're expanding clickability of next to the other capabilities outside of oncology, where many of US I've thought about the primary customer base. Currently doing can you just provided some more current outdated thought on the opportunities outside of oncology with farm and I thought process of too.
Whether uhm.
Spansion or our survey adaptation of current functionality.
Be constructive and and expanding that portion of the addressable market.
Yeah, that's great questions. So we we've we've always had a certain amount of our business. That's been outside of oncology generally the products have been designed focused on oncology needs, but the capabilities, sometimes or unique enough that that people say I really.
I would like to use this in another study I have that's outside that in.
Generally this has come up.
With frontman by working with folks in their own oncology side of a pharmaceutical company and having them.
That'd be aware of some other needs and other places in there and their company. So it's it's mostly on the farm aside we do see.
Additional interest an additional orders coming in like that I think the one we highlight it really was <unk> and that was unique because it really leveraged R. Neil anti-aging capabilities outside of oncology.
And that was definitely a hurt so I think there.
The leading edge of that I think that said an interesting area for the future.
Yeah, it'll take time for others to adopt that as well I think this.
It's so much opportunity for us inside oncology at this point that were that's really where the majority of our for this night.
Oh, great and that May be one housekeeping question for me and that's you know you you did kind of call out we've heard this elsewhere, you know a little bit more of a a measured pace.
<unk> face a clinical trial enrollment and the impact address has on your business. My question is you know as as.
Okay. So clinical trial enrollment you know reaccelerate at some point.
How do we think about the lag between when.
Patience.
The rate of patients entering studies begins to Reaccelerate and when revenue I actually would typically hit the piano personalities.
Yeah, So I think they.
What we see is that are the uptake in our orders has been.
More substantial than the uptake in revenue not the revenue it hasn't been going badly, but I think there's room for for that to grow further given the orders that we've seen so I think we sort of have the orders and hand and then.
His name was free up as we come out of Covid hard for me to know exactly when that's going to be.
Think we actually have a lot of orders on the books that they can turn into revenue at that at that time. So we're seeing we're seeing uhm some of that now because of the growth and orders that we've had over the last let's say five quarters or so we're definitely beginning to say more samples now coming from that and so did I think that that in time.
If we get to a point where.
Enrollment in trials towards continue is is expanding more I think that'll happen even more some of it is that the samples already exist, but it's a question of not only having enrollment in trials opened up but having biobanks be opened up so that they can ship us the samples that they make us they already have.
Super helpful. Thanks, So much for taking my questions.
Okay. Okay. Thanks for your time today.
Our next question will come from the line of Mark Nazzaro from V. P. I E. The nineties now open.
Hi, Mark.
This has been going on for like.
Okay.
Can I say.
Hi can I first question, yeah, changing your energy and characterization and try and biopharma to more of a clinical setting and how do you anticipate kind of bending down the cost curve to make that my fastball.
Okay. So let's see in terms of new management characterization little towards the more clinical setting I think the key there will be having.
Monsters that are specifically tied to uhm outcomes with specific drugs.
We've already and work that we've been talking about a conferences with some of our collaborators that we can be have a lot more statistical certainty.
Using a new image and based biomarker to look at checkpoint inhibitor response for example than just using a simpler biomarker like sure mutational burden or or something that you could do with a a small panel. So I think that's that.
I see.
The capabilities are used in clinical trials and particularly his companion diagnostics, which is part of what we're pursuing now.
Do you think that will lead to increasing the visibility of the clinical utility and we have the platform available now as a clinical diagnostic but pet to have the reimbursements before these these kinds of new antigen base Biomarkers will require proof of click.
Uncle utility so I think that's going to be coming that that will take.
Sometime in terms of the cost curve.
Pricing to harm on our next platform is actually similar to the pricing of much much smaller clinical diagnostic panels that already exist at our reimburse I think that we're we're in pretty good shape from a cost point of view as familiar as the cost of sequencing continues to come down and so forth will benefit from that but.
I think we're in a position that we already are pricing in the range, which is comparable to what I'm diagnostic customers are used to paying for much smaller panels as diagnostic tests.
Oh that sounds awesome. Thank you.
My next question would be email or what.
What kind of activity biopharma him if he could you provide a it up my car and that and.
Could give a ballpark and the amount that next revenue contributed as a percentage of total biopharma.
Yeah, I guess in terms of those numbers I don't know if Aaron is back on the line. After the interruption. If you want me to check that one.
Sure I'm back on the line Hi, Vivian in terms of what drove Biopharma. So most of our business is retrospective in nature. So we have a lot of pharmaceutical companies our customers that we do business with today now we're doing business with most of the top 10 customers and then we also have.
Some smaller biotech that we're doing business with as well again, so the the biopharma revenue of five $7 million. Most of that was retrospective in nature in terms of the other component that was in this quarter's revenue. We did have a half a million dollars that came from one customer outside of oncology.
And it's not expected to repeat in the near term Uhm and that basically was for you says our next platform, but outside of oncology would you can go to gym prediction capability that we have.
In terms as a mixture of revenue so biopharma and all of their customers was roughly.
29% of the total revenues today. So if you look back the last couple of quarters, we were in the 24% to 25% range of total mix.
As we go forward, we expect the Biopharma and all of the customer mix percentage of the total to continue to increase over time.
Had great traction from an order standpoint over the last.
Four to five quarters, and it's beginning to convert to revenue now in terms of those orders.
Oh, Okay. That's awesome. Thank you uhm, except for my last question at the broader.
And how would you sense that the market is understanding that.
S U and my parking should be used.
As in my compliment came at that.
So I would say.
Pharmaceutical companies who are.
Primary customers people completely get it you know they are coming out at their scientists.
They were trying to understand what's happening in the biology of the tumors patience in their clinical trials on so.
In general people, who have bought into our next platform already appreciate.
The comprehensive approach we've taken so it's.
The comprehensive all 20000, James DNA, alright, the immune system and so forth and so.
I think the the kinds of people were working with have the scientific uhm.
Uhm understanding and in fact, they're very bought into that comprehensive approach. So yeah. I think they understand that there are certain things you can only see with a liquid biopsy.
Certainly a certain time points are much more accessible that way on the other hand. They also I understand there are certain things you can only say with a tissue biopsy. So from tissue, we see RNA, which is enormously informative and you wouldn't normally having a software DNA essay and we can also see the immune cells that are actually inside the tumor.
They tend to be different from the immune cells that you'd see.
In the bloodstream and so.
The scientists we work with generally understand that and so that's that's a part of what they get from the tissue side of what we're doing and then the the liquid biopsy part gives them the ability to see some of the the dynamics overtime. So I think it's the same typically is actually fairly distinct.
And because of the kinds of customers. We have who are often very advanced from a scientific point of view you know people understand it right away and are are generally quite plugged into that.
Oh, Thanks for taking the question that's great. Thank you. Thank.
Thank you thanks Caribbean.
Our next question will come from the line of Steve Unger from Me then the line is now open.
Okay, Hi, Thanks, just a couple quick ones for me as far as the Neil antigen model or module excuse me what what's the revenue model for that is that incrementally priced and the next or.
Like a bigger collaboration type relationship.
So I would say that are.
The new address and ranking there's a new capabilities it will be adding it will just be an additional capability at the next platform. The current plan is that the pricing is.
Is the same as our existing next platform. We've said from the beginning that the other one of the goals of the next platform was this.
Comprehensive understanding of the underlying mechanisms of action.
Oh oncology and.
Outages are absolutely central to that so this is now you're putting us in a position where although we've had ranking in the past. This is much more precise than we've had before it really differentiates the products. So we think that you will see this financially in increased uptake of the product has it's more and more differentiated in terms of its.
Capabilities compared to somebody just let's say renting more standard sequencing and using just academic algorithms for new Amazon ranking.
Great that's super helpful and then.
And in the a M B P.
Ask order announcement, you did mention that there were opportunities for additional task orders over the coming 12 months and I was just curious as to what would be what that would be contingent upon or what would open up offered the opportunity for additional task orders isn't the election.
Or proposed budget changes.
Associated with perhaps stimulus I'm just curious.
Yeah, I think that they get them from our standpoint, there's there's we'd be happy to just things up if the VA could do that and and from what we know the people who were inside the million Veterans program. You know they just want to go as fast as they can I think it's really comes down to budget matters obviously.
It is one of the largest health care systems in the United States and so it also has a large number of covid patience and so this is a very serious issue in the side of the B a as a medical system. So I think this has led to a certain.
I'm Gonna say siphoning off of.
Of of human capital and also to some extent financial capital towards.
If we get to a point that they were beginning to make progress against the the Corona virus and the.
The case load starts to come down and there's more clarity around some of that.
I think people will be.
Not be as worried that they may have to you know have even more fun set aside for the corona virus and be able to get to a quite that way. They can get back to some of the the the kinds of research calls they had with a million veterans program.
So.
I think that I think that could happen. They it could also be that'd be it may be that the next door to we received.
Comes in with the new contract that we expect to negotiate in the summer of next year.
Okay and then finally is there any update on F D. A approval timelines treat either tissue or liquid uhm.
Can't remember, where we're at as far as progress there.
Yeah. So it was let's hit the the first product that were taken care of the F. T. A is R. I D. Next platform. So this is our tissue base product that we already have in place.
And we've had our first pre submission meeting with the F. D. A on that I think it was very well received that's a little hard to time to put a timeline on it because it is one of the most comprehensive platforms ever to go through the F D a and so.
We're working through with them what kinds of studies will be required and so forth I'd say.
The response has generally been that this should be.
Doable, we have to do our homework, but there's no reason that a product like this can't get through the F. D. A and I'd I'd say that even something like there was some enthusiasm for taking on something that was you know more forward looking like this and so I think we're optimistic about it but we have.
Laid out a timeline publicly usually these things can take a few years.
Okay got it.
Thank you I appreciate it.
Okay, great. Thank you thanks, Steve.
Our next question one from the line of swipe swam.
Cooler from H C. Wainwright the line is now open.
Thank you. This is okay from head to mandate.
Good evening John.
Alright, well a quick.
A couple of quick questions you know.
In terms of I'm, just trying to understand what sort of customer base would you be targeting when you're looking at you know your new personalized liquid biopsy product verses.
The the the the the liquid biopsy, probably just spelled that you'd previously had been introduced to the market.
I'm just trying to see is some of it going to be more like the traditional biopharm customers business.
I Gotta make folks are Ho you know I'm I'm, just trying to see if you're going to expand your customer base.
Doing this personalized think goodbye to predict.
Yeah, that's great I think they the answers you know I'm sure. Our first customers are likely to be in large pharmaceutical companies the kinds of folks who work with before but I think the kinds of studies there'll be involved in maybe different certainly we see a lot of interest to pharmaceutical companies now to investigate the use of cancer drugs in earlier stages and.
So this is these are typically cases, where you have.
The patient and they have a certain amount of surgical resection potentially even complete surgical resections. So then.
The question is it in theory, the timber should be done that.
The question is is is the tumor in fact going to be coming back, perhaps because the surgical resections. It turns out that it wasn't really a complete and they've been some great studies with some drugs showing that.
Adamant therapy at that time.
Can lead to a dramatic reduction N cancer recurrence and so that's kind of what the clinical trials tend to be about that then.
Trying to the tech cancer that hasn't come back yet you're trying to detect it earlier and earlier.
Sensitivity limits you need to be thinking about are not down that's a fraction of a percent, but they ended up being more down in the park vermilions kind of range and at this point I'm not aware of other products that target the.
For a million kind of.
Range, but that's the kind of them that we hope to enable with our next personal particularly given the potential to be able to look at large numbers of very it last time.
Great. The next question on the last question for me is.
You.
Made some comments regarding your collaboration with set up then.
It could be an example of market expansion into other therapeutic areas outside of phone calls you could you comment on you know what I'll go ahead and <unk>.
Could be utilizing your services are.
Our products.
Oh yeah.
I'd say over the years, we've work with people who are working on.
Drug development in a variety of different medical settings, including.
You know I don't know all all different kinds of of elements of medicine, because the products tend to be focused on the features required for cancer.
Vast majority of the business has been.
From cancer I think the interesting aspect for us in this recent sore after therapeutics work was.
That you know this is really coming about because of.
Genetically engineered therapeutic products, and we see there being more and more genetically engineered therapeutic products, particularly when people think about cell therapies and so.
As your engineer sells particularly maybe cells come from the patient somebody originally.
If you engineer them you are effectively retaining them I'm trying to think of it is mutating them, but that's essentially what springs on and so if you put mutations into the yeah. The genome so they put it back into the body.
May be generating new antigens that you may not have anticipated it doesn't so our ability to.
Assassin, you antigens and to think about whether for a particular locations cause could elicit with an immune response that you maybe didn't want.
Is part of what we think could open up an opportunity here. So I think it's early days, but it could be an interesting.
Market expansion opportunity for us for sure.
Thank you. Thank you John Uhm practitioner.
Okay, great. Thank you.
Thank you for those who would like to ask a question. Please press. The Star then the number one on your telephone keypad again for those who would like to ask a question. Please press the star than the number one on your telephone keypad.
Our last question on the Q is coming from Patrick Donnelly from city. The line is now open.
Thanks, guys, John maybe one for you I appreciate the the color on terms of number of next that were place I was just wondering if you could break out a little further assist in terms of what the orders look like what they are covering I know typically it's it's kind of retrospective pharma companies covering a large number of samples they have in a trial she.
She just wondering what those looked like this quarter and if that composition order order size has changed much for you.
<unk> couple of course.
I'd say, we we've always worked with pharma in a variety of different trials, sometimes there.
Early stage trials pays one's a phase choose where people are doing things that are experimental but.
You've really credit for years, we've worked with people also on later state trial. So even a large page three work you know things may have gone, while or maybe they didn't go as well as the farmer intendant and they want to understand what happened here.
We can ended up being brought in on those too.
Hope provide a more comprehensive picture of what happened with the the patients who are involved so I think the the mix is perhaps not that different now in terms of.
The the types of trials, what we are saying is.
More substantial by and across a larger number of pharmaceutical company. So I think the next platform in particular.
Kind of its capabilities that we never had before next bringing the immune system into the equation all from a single sample.
And so that's that's part of what's led to the uptake. We're now working with pharmaceutical companies that a year ago, we've never been able to get out too. So I think the next platform Israeli opening doors for us on that and broadening out our customer base. So that's been that's really help with a.
Ramp up in in order, so that we've been recording.
That's helpful and then maybe another one on the next platform. Just can you just talking about yourself force ability to engage customer at the moment you know given them obviously the virtual set it for the most part how that's been trending and then just the general feedback from customers in terms of that engagement that'll be helpful.
Yeah. So so I'd shake at the beginning of the Corona virus period of time and with transitioning too you.
You know a group working from home I think we have a lot of trepidation about what that would be like not being able to go visit customers in person and not being able to meet with them in person that conferences.
What's gonna interesting is that we've actually found that in some ways. It's made it easier to interact with customers because.
<unk> you know almost all of our customers are still working full time, they're just working fulltime from home, but because they're traveling a lot less they're actually more accessible and so.
The the idea in the past if we wanted to have a meeting at a large pharmaceutical company was 20 different people involved.
It can be hard to find a single day, when all 20 people would would either and somebody wouldn't be way traveling or to some other meeting what we find is that you know, it's still take scheduling, but because there's less travel people often have more accessible schedule. So giving our group has worked quite hard to to make sure that we are continuing to stay in touch and and.
And and they are being active in terms of at least meeting. So I do think it's not the same as being in person, but the video meetings. We use the zone system can be remarkably effective and you spend more time connecting with a customer in less time trying to make your way through airports. So there there is actually an increase deficiency.
See that's happened and.
I think we're I think we look forward to a day when we can in fact go back into this customers in person, but it has actually been working get a remarkably fluffy we've talked about this.
Scale of orders that we've seen in the front row side of our business being you know almost 100 per cent up.
Yeah, I think that's an indication of a group continuing to be able to be effective even in spite of the both our company and also our customers operating and work from home but.
That's great. Thanks, Joe.
Okay, well, thank you for your time and interesting.
There are no for a good question.
Hi, <unk>.
Okay. This is this is John West. Thank you all very much for your attention today and I think with that will conclude the conference.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating you may now disconnect.
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