Q3 2021 IsoPlexis Corp Earnings Call
Speaker 1: Good day and thank you for standing by. Welcome to the ISOPLEX's third quarter 2021 earnings conference call. At this time, all participants are in listen-only mode.
Good day and thank you for standing by welcome to the ICL Plexus third quarter 2021 earnings Conference call.
At this time, all participants are in listen only mode.
After the presentation, there will be a question and answer session.
Speaker 1: To ask a question during the session, you'll need to press star then 1 on your telephone keypad. Please be advised today.
To ask a question during the session you will need to press Star then one on your telephone keypad.
Please be advised today's conference maybe recorded.
Speaker 1: If you require any operator assistance during the call, please press star then zero.
If you require operator assistance during the call. Please press Star then zero.
Speaker 1: I'd now like to hand the conference over to your host today, Carrie Mendeville, Investor Surface Turkeyida.
I'd now like to hand, the conference over to your host today, Carrie Mendivil Investor Relations.
Speaker 2: Thank you. Earlier today, Isoplexis released financial results for the quarter and in September 30, 2021.
Thank you.
Earlier today <unk> released financial results for the quarter ended September 32021.
Speaker 2: If you have not received this news release, or if you'd like to be added to the company's distribution list, please send an email to investors at isoplexis.com.
If you have not received this news release or if you'd like the attitude. The Companys distribution list. Please send an email to investors at ICL, Texas Dot com.
Speaker 2: Joining me today for my suplex is Arshan McKay, Chief Executive Officer, and John Straley, Chief Financial Officer.
Joining me today from Michael boxes are Sean Mckay, Chief Executive Officer, and John <unk>, Chief Financial Officer.
Speaker 2: Before we begin, I'd like to remind you that management will make statements during this call that are forward-looking statements within the meaning of federal securities laws.
Before we begin I'd like to remind you that management will make statements. During this call that are forward looking statements within the meaning of federal securities laws.
Speaker 2: These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated.
These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated.
Speaker 2: Additional information regarding these risks and uncertainties appears in the section entitled Forward Looking Statements in the Press Release Isoplex's Issue Today.
Additional information regarding these risks and uncertainties appears in the section entitled forward looking statements in the press release I saw parts of issue today.
Speaker 2: For a more complete list of descriptions, please see the Risk Factors section of the perspective filed on October 12, 2021, and in the other filings with the Securities and Exchange Commission.
For a more complete list and description. Please see the risk factors section of the prospectus filed on October 12, 2021, and in the other filings with the Securities and Exchange Commission.
Speaker 2: The company intends to file its quarterly report on Form 10Q for the quarter ended September 30, 2021.
The company intends to file its quarterly report on Form 10-Q for the quarter ended September 32021 later this week.
Speaker 2: Except as required by law, ISA PLEXIS disclaims any intention or obligation to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise.
Except as required by law I saw plusses disclaims any intention or obligation to update or revise any financial projections or forward looking statements, whether because of new information future events or otherwise.
Speaker 2: This conference call contains time-sensitive information and is accurate only as of the live broadcast November 10, 2021. With that, I'd like to turn the call over to the audience.
This conference call contains time sensitive information and is accurate only as of the live broadcast November 10th 2021.
With that I'd like to turn the call over to Sean.
Speaker 3: Thanks, Kerry. Good morning and thank you for joining our third quarter 2021 earnings call.
Thanks Carrie.
Good morning, and thank you for joining our third quarter 2021 earnings call. Our first as a public company. We completed our initial public offering in mid October raising approximately $111 billion in net proceeds. This brings the total capital raised in the last year to more than 245 million strengthening our balance sheet.
Speaker 3: We completed our initial public offering in mid-October, raising approximately $111 million in net proceeds. This brings our total capital raise in the last year to more than $245 million, strengthening our balance sheet to capitalize on opportunities in single-cell proteomics and single-cell motility.
Lives on opportunities in single cell proteomics and single cell whole buildings.
Speaker 3: Before we get started, I'd like to express my sincere thanks to the strong team we have assembled with our supply.
Before we get started I'd like to express my sincere thanks to the strong team we've assembled a bunch of places.
Speaker 3: Our progress is truly a testament to their collective dedication and passion.
Our progress is truly a testament to the collective dedication and passion.
Speaker 3: At Isoplexis, we are focused on capturing powerful biology to accelerate advanced curative medicine.
Did I supply since we are focused on capturing powerful biology to accelerate advance curative medicines over the last five years modern medicine has changed substantially from an accelerating stream of innovation across proteomics single cell biology, and functional multi omics.
Speaker 3: Over the last five years, modern medicines changed substantially through an accelerating stream of innovation across proteomics, single-throw biology, and functional multi-homeless.
Speaker 3: Cell and gene therapy is revolutionized medicine. Vaccines are now driven by RNA and two of the largest selling oncology drugs in the world are cancer immunotherapy.
Cell and gene therapy has revolutionized medicine vaccines are now driven by R&D and two of the largest selling oncology drugs in the world or cancer Immunotherapies.
Speaker 3: With this innovation, there is a tremendous opportunity to leverage human biology to cure disease.
With this innovation, there's a tremendous opportunity to leverage human biology to cure disease. However.
Speaker 3: However, in order to do that, we need a better understanding of a needle biology to create personalized medicines fast.
However in order to do that we need a better understanding of in vivo biology to create personalized medicines faster.
Speaker 3: At Isoplexis, we have developed a unique technology platform, which is bringing together proteomics, single cell biology, and functional multiomics to reveal a higher fidelity picture of in vivo biology.
It also places we have developed a unique technology platform, which is bringing together proteomics single cell biology, and functional multi omics to reveal a higher fidelity picture of in vivo biology.
Speaker 3: At its core, our platform is able to capture the critical proteins from single cells to drive disease response and therapy to get back.
At its core our platform and be able to capture the critical proteins from single yourselves to drive disease response and therapeutic impact.
Speaker 3: A new way to book proteomics is identifying a series of complex disease and therapeutic drivers that genomics misses, unlocking a new era of understanding and biology.
Our new wave both proteomics is identifying a series of complex disease and therapeutic drivers that genomics niches unlocking a new hero understanding of biology.
Speaker 3: Realized subplexes are able to uniquely capture proteomics at the single cell level.
Weird I saw plexus, we're able to uniquely capture proteomics at the single cell level.
Speaker 3: to reveal the earliest sources of therapeutic response and disease activity in ways that book proteomics alone and genomics met.
To reveal the Uber you sources of therapeutic response and disease activity and wave.
The whole mix alone and genomics nish.
Speaker 3: We focus our platform with a lens towards predicting and vivo biology. And in particular, the long-term responses that are driving these novel advance curative medicine.
We focus on our platform with the lens towards predicting in vivo biology and in particular, the long term responses that are driving these novel advance curative medicines for.
Speaker 3: For example, our single cell proteomics platform has revealed highly active super cells in our immune system.
For example, our single cell proteomics platform as revealed highly active super cells and our immune system.
Speaker 3: that have proven key to creating an optimal response against various cancers.
Proving key to creating an optimal response against various cancers.
Speaker 3: In addition, single cell multionomics, via new offering, duomic, is paving a path to find the genetic drivers of these super cells, which can allow us to synthetically reproduce these pathways themselves into more churred of metastasis.
In addition single cell multi omics via our new offering the WOMAC is paving a path to find the genetic drivers of these super cells, which can allow us to synthetically reproduce these pathways and sells into more curative medicines.
Speaker 3: Our unique single-cell proteomics products have driven our growth today and our new single-cell multi-omics products in development represent a large opportunity.
Our unique single cell proteomics products have driven our growth to date and our new single cell mobile mix products in development represent a large opportunity ahead.
Speaker 3: We have made great strides demonstrating the utility of our platform in single cell proteomics through extensive clinically relevant published studies and data.
We have made great strides demonstrating the utility of our platform and single cell proteomics through extensive clinically relevant published studies and data.
Speaker 3: Fingalphal proteomics is unlocking significant discovery and advanced medicine understanding. In various clinical trials, we'll reshed light on the most potent biology and in clinical studies, where we identify early signals and respond to the patient.
Single cell proteomics is unlocking significant discoveries in advanced medicine understanding in various preclinical trials, where we shed light on the most potent biology.
And in clinical studies, where we identify early signals of response in patients.
Speaker 3: Our platform is available in two bench hop instruments, the Isolite and the Isospark.
Our platform is available and two been sharp instrument.
So late in the ISO spoke.
Speaker 3: With similar functionality and ease of use, both instruments are proteomic hubs. With the higher throughput isolate built for core labs, and the ISO Spark catering to personalized labs.
With similar functionality and ease of use both instruments called proteome Cogs.
The higher throughput I used to like built for core labs, and the ice is spunk catering to personalise logs.
Speaker 3: based on our growing leadership position in clinically relevant publications. We continue to expand our install.
Based on our growing leadership position in clinically relevant publications.
We continue to expand our installed base and usage we.
Speaker 3: We are now in the majority of National Cancer Institute designated comprehensive cancer centers in all 15 of the top 15 pharmacums.
We are now in the majority of.
A national Cancer Institute designated comprehensive cancer centers in all 15 of the top 15 pharma companies.
Speaker 3: Now we will turn to Do All Make, our new single cell multi-omics product offer.
Now, we will turn to do I'll make a new single cell multi omics product offering.
Speaker 3: We are well positioned to leverage our core single saw proteomics off.
We are well positioned to leverage our core single cell proteomics offers as.
Speaker 3: As we can now sequence the supercharged proteomic cells we detect.
As we can now sequenced supercharged proteomics cells, we did that.
Speaker 3: The ability to highly medic like unique combinations of transcriptomics and proteomic targets will accelerate therapeutic discovery even faster.
The ability to highly multiplex unique combinations of transcript filmmakers and proteomics targets will accelerate therapeutic discovery even faster.
Speaker 3: We do this by bridging the genomic cell atlas in the discovery realm. We keep proteomic analytes like cytokines and phospho proteins for the first time.
We do this by bridging the genomic cell Atlas in the discovery zone with key proteome Mckenna legs like cytokines and fossil proteins for the first time.
Speaker 3: which is necessary to leverage the single cell biology in the clinic.
Which is necessary to leverage the single cell biology in the clinic.
Yeah.
Speaker 3: Our proteomics technology is applicable to a wide range of immune-based advanced medicines and serves the $12 billion addressable market opportunity across roughly five and a half thousand clinical programs.
Our proteomics technology is applicable to a wide range of immune based advanced medicines and sort of the $12 billion addressable market opportunity across roughly 500000 clinical programs.
Speaker 3: We believe this market will continue to grow during by the massive interest of discovery across proteome.
We believe this market will continue to grow driven by the massive interest in discovery a cross proteomics.
Speaker 3: The more proteomic targets that are identified, the more our customers are interested in identifying the cells creating those proteomic analytes to identify the earliest signals of response and disease.
The more protean with targets that are identified the more our customers are interested in identifying the cells, creating those proteomics end of life to identify really has signaled the response and disease.
Speaker 3: In addition, D'Omic provides us access to a separate discovery focus market which represents an additional $12 billion total addressable opportunity.
In addition to omit provides us access to a separate discovery focused market, which represents an additional $12 billion total addressable opportunity.
Speaker 3: Our long-term growth will be driven by the expansion of our functional cell library, the growing number of high-impact, clinically relevant publications, showing the value of our technology.
Our long term growth will be driven by the expansion of our functional cell library.
Growing number of high impact clinically relevant publications showing the value of our technology.
Speaker 3: and providing customers with new innovations to expand our technology's capability.
And providing customers with new innovations to expand our technology capabilities.
Speaker 3: We have made tremendous progress this year across all three of these areas.
We have made tremendous progress this year across all three of these areas.
Speaker 3: First, we continue to extend our functional cell library for single cell proteomics, which is a proteomic equivalent for the clinic that the cell Atlas has been for human discovery in Genome.
First we continue to expand our functional cell library for single cell proteomics, which is the proteomics equivalent for the clinic the to sell Atlas has been for human discovery in genomics.
Speaker 3: We now have a wide number of cell types, protocols and workflows, which enables understanding of immunology, tumor biology, and more broadly inflammation.
We now have.
Wide number of cell types protocols, and workflows, which enables understandings of immunology tumor biology and more broadly inflammation.
Our goal is to comprehensively cover all proteomics driven cells in the human repertoire in the coming years.
Speaker 3: Oracle is to comprehensively cover all proteomically driven cells in the human repertoire in the coming years.
Speaker 3: Second, we have seen a growing number of publications demonstrating the value of our technology.
Second we have seen a growing number of publications demonstrating the value of our technology.
Speaker 3: We will leave customer publications will be a leading indicator of traction in key-end markets.
We believe customer publications will be a leading indicator of traction in key end markets.
Speaker 3: This data creates the unique use cases of our platform, which is developing optimizing more durable immunotherapies, and delivering predictive potency to biopassessing and salt therapy development.
This data creates a unique use cases of our platform such as developing optimizing more durable immunotherapies and delivering predictive potency for bio processing and cell therapy development.
Speaker 3: In addition, the clear clinical utility of developing early biomarkers from our most potent single cell.
In addition, the clear clinical utility of developing early biomarkers to more most potent single cells.
Speaker 3: is increasing for academic medical centers, bioformer and biotech alike.
Is increasing for academic medical centers, Biopharma and biotech alike.
Speaker 3: To date, there have been 95 publications demonstrating the necessity of single cell proteop.
To date, there have been 95 publications demonstrating the necessity of single cell proteomics to driving earlier signals of response in key high growth markets like cell therapy and immuno oncology.
Speaker 3: to drive the earlier signals of response in key high growth markets like self-aeroplane and immuno-on-college.
Speaker 3: To that end, there are two recent sets of publications that really exemplify this balance.
To that end there are two recent publications that really exemplified this value.
Speaker 3: Starting with two nature medicine publications that will landmark studies in South therapy against flight cancer until therapies against solid tumor.
Starting with two nature Medicine publication, Google Landmark studies in cell therapy against cancer.
Til therapies against solid tumor.
Speaker 3: Both publications illustrate our platform strength in identifying early indicators of potency and durability in cell therapies against the wide range of...
Both publications illustrate our platform strength that identifying early indicators.
And two younger ability and cell therapies.
Against the wide variety of cancers.
Speaker 3: These productive use cases are proving to be a high value.
These predictive use cases are proving to be of high value.
Speaker 3: in both developing cell therapies and developing bioprocess strategies for cell therapy.
In both developing cell therapies, and developing bioprocess strategies for cell therapy.
Speaker 3: Additionally, a Journal of Clinical Oncology study highlighted ISIL complexes from single-cell proteomics as a biomarker identifying the long-term patient responders in a combination checkpoint inhibitor study in solid two.
Additionally, a journal clinical oncology study highlighted Idaho places from single cell proteomics biomarker identifying the long term patient responders in a combination checkpoint inhibitor studies in solid tumor.
Speaker 3: This publication is important for the field as it demonstrates the clear ability to detect early signals of long-term response in patients, which were otherwise not possible with existing proteomic
This publication is important for the field as it demonstrates the clear ability to detect early signals long term response in patients, which would otherwise not possible.
With existing proteomics and genomic technologies.
Speaker 3: Our goal is to continue to leverage these proven use cases to generate increased market share in each of these critical self-therapy and immunotherapy area.
Our goal is to continue to leverage these proven used cases.
To generate increased market share in each of these critical cell therapy and immunotherapy areas.
Speaker 3: Third, we introduced our duomic platform, which ties our unique single cell proteomic biology to the genetic drivers of those protein responses for the first time.
Third we introduced our dual make platform, which ties our unique single cell proteomics biology.
Kinetic drivers of those protein responses for the first time.
Speaker 3: This build on not only years of development, but also on a recent acquisition of an extensive DNA in RNA sequencing portfolio earlier this year.
This builds on not only years of development.
But also on our recent acquisition of an extensive DNA and RNA sequencing portfolio a little later this year.
Speaker 3: Now, turning attention to our recent progress, I'd like to give an update by worrying about things around three key themes, customer adoption, operational execution, and product innovation.
Now turning attention to our recent progress I'd like to give an update.
What are you, hoping around three key themes customer adoption operational execution.
Innovation.
Starting with customer adoption, we are focused on growing our installed base through our land and expand strategy during.
Speaker 3: Starting with customer adoption, we are focused on growing our installed base through our land and expand strategy.
Speaker 3: During the year, we continue to make progress adding new customers and placing more instruments within existing customer accounts.
During the year, we continue to make progress, adding new customers and placing more instruments within existing customer accounts.
Speaker 3: For example, this year we placed four units in the designated comprehensive cancer center, which are being used across multiple investigations.
For example, this year, we placed four units in the designated comprehensive cancer Center, which are being used across multiple investigators.
Speaker 3: A key driver of this expansion in the ability to place the personalized lab system, the ISIS spark, an individual research lab while placing the higher throughput ice-widen core lab.
A key driver of this expansion is the ability to place the personalized lab system, the Isa spark and individual research lab, while placing a higher throughput isolating cortland.
Speaker 3: The flexibility for each act is a hub of various functional proteomic assays while maintaining an attractive price point creates the ability to have a large potential market for multiple units at each cancer center or bioform.
The flexibility for each to act as a hub of various functional proteome agassiz, while maintaining an attractive price point.
It's the ability to have a large potential market for multiple units at each cancer center or biopharma.
Speaker 3: We are also seeing growing utilization within our expanding install base.
We are also seeing growing utilization within our expanding installed base.
Speaker 3: When we place an instrument, our instrument sales team, our consumable sales team, and our field application specialists, partners with the customer to get the customer up and running quick.
We placing instruments our instrument sales team our consumable sales team.
Field application specialist partner with the customer to get the customer up and running quickly.
Speaker 3: By investing early, we were able to educate key users, drive consumable use in shortly after install, and also expand usage to other departments or researchers that see the capabilities and value of our system.
By investing early we were able to educate key users drive consumable usage. Shortly after an install and also expand usage to other departments are researchers the CD capabilities and value of our system.
Speaker 3: This customer's interest is contributing to increased utilization, which in turn drives more instrument sales within a larger academic center or biofarmer, as in Jason Lab, by the own.
Customer Centricity is contributing to increased utilization, which in turn drives more instruments sales within a larger academic centers, where biopharma is adjacent law by their own systems.
Speaker 3: The coolest focus of our commercial team has been to develop close relationships with the customer at each stage of our sales phone.
Our core focus of our commercial team has done to develop close relationships with the customer.
In each stage of our sales funnel.
Speaker 3: We have added an inside sales team to manage the increasingly large incoming interest in our platform while being responsive to requests and prospects.
We've added an inside sales team to manage the increasingly large incoming interest in our platform, while being responsive to requests from prospects.
Speaker 3: This team works closely throughout our global regions, inclusive of the Americas, NMEA and APEC.
This team works closely throughout our global regions inclusive of the Americas, EMEA and APAC.
Speaker 3: In addition, our growing instrument sales team and leadership leverages our funnel management software systems to deliver sustained and predictable
In addition, our growing instrument sales team and leadership Leverages, our funnel management software systems to deliver sustained and predictable instrument growth.
To bolster our international offerings, we have hired a larger support team in EMEA and it would be done.
Speaker 3: And both throughout international offerings, we have hired a larger support team in Yemeni A and have begun expansion into A-PAC, including the recent hiring of a general manager and securing our local business life.
Pension into APAC, including the recent hiring of a general manager and securing a local business licenses.
Speaker 3: Finally, our close relationships with our customers allows us to know where the market is going next and stay at the edge of innovation.
Finally, our close relationships with our customers allows us to know where the market is going next.
Hey at the edge of innovation for.
Speaker 3: For example, one of our largest customer requests with the sequence are unique supersomes.
For example, one of our largest customer requests with the sequence our unique super cells.
Speaker 3: Through development and acquisition, we're delivering on that customer request with our duomic product.
The development and acquisition, you're delivering on that customer request without do only product.
Speaker 3: Turning to operations, we are focused on scaling our business to meet demand now and over the next few years for our high growth single-solve proteomics business.
Turning to operations, we are focused on scaling our business to meet demand now and over the next few years for our high growth single cell proteomics business.
Speaker 3: To do this, we have significantly expanded our manufacturing and logistics team and footprint to include multiple equipped facilities, inclusive and clean room and automation, which have the capability to produce isolated and nicest park instruments and our single cell consumer.
To do this we have significantly expanded our manufacturing and logistics team and footprint to include multiple liquid facilities inclusive of cleaning and automation, which has the capability to produce isolate and nicer spoke instruments and our single cell consumers at scale.
Speaker 3: We have built many of these capabilities internally, so we can manage any variability in supply chain in the coming years.
We have built many of these capabilities internally. So we can manage any variability in supply chain in the coming years.
Speaker 3: We have invested in a technology-enabled procurement team and system to ensure we have multiple sources for our most critical components. We continue to leverage a high-quality, lean manufacturing methodology to ensure that our customers are well-in-the-box.
We have invested in new technology enabled procurement team and systems to ensure we have multiple sources for our most critical components, we continue to leverage our high quality lean manufacturing methodology.
Speaker 3: while at the same time ensuring that our customer demand and top line revenue will not be impacted by any part shortages.
While at the same time, ensuring that our customer demand and top line revenue will not be impacted by any part shortages.
Speaker 3: And both through that, we continue to acquire critical long shelf life inventory, especially on the computer chip in electrical technology side to ensure our resilience.
Both do that we continue to acquire critical long shelf life inventory, especially on the computer chip electrical technology side to ensure our resilience.
Speaker 3: Finally, our logistics team has invested in a series of partnerships globally with our expansions into EMEA and APA.
Finally, our logistics team is investing in a series of partnerships globally with our expansion into EMEA and APAC.
Speaker 3: to ensure that our growth in those regions can be supported by a continuous source of instruments and chips, as well as the necessary on-site field support required.
To ensure that our growth in those regions can be supported by continuous source of instruments and chips.
As well as the necessary onsite field support required.
Speaker 3: You will continue to stay focused operationally and take steps to support our current and future growth.
We will continue to stay focused operationally.
Take steps to support our current and future growth.
Speaker 3: Turning to our pipeline, we are investing heavily in our duomic platform, which addresses a large unmet gap in the multi-omic market, offering a new functional proteomic analyte class to single-cell sequencing and proteomic connected biology.
Turning to our pipeline, we are investing heavily in our dual make platform, which addresses a large unmet gap in the bolting all make market.
Offering a new functional proteomics analyte class to single cell sequencing and proteomics connected to biology.
Speaker 3: With our investment in focus, Duomik is coming along faster than expected.
With our investment and focus do homework is coming along faster than expected.
Speaker 3: We have already concluded a proof of concept demonstration where data released at AGBP Precision Health in September , the data demonstrated new access to deeper tumor biology in particular the ability to connect genetic information directly to the phosphoprotein in each cell.
We have already concluded a proof of concept demonstration with data released at <unk> precision health in September.
The data demonstrated new access to deeper tumor biology, and particularly the ability to connect genetic information directly to the possible proteins at each so.
Speaker 3: For the first time, we were able to generate deeper data in CAR-T therapy by connecting genetic circuits to proteome-excited kind response as well.
For the first time, we were able to generate deeper data in car T therapy by connecting genetic circuits to proteomics cytokine response as well.
Speaker 3: Duelmic represents what we see as a discovery bridge between the genomically driven cell Alice and the proteomically driven clinical development process. The...
Two O make represents what we see as a discovery bridge between the genomic lead driven sell Atlas in the proteomics driven clinical development process.
The evolution into proteomics.
Speaker 3: and the desired leverage of the cell hours provides a unique opportunity for isoplexus via duomic to connect with two in the first time with functional proteomic analyzer.
And the desire to leverage the cell Atlas provides a unique opportunity for ISO plexus via do I'll make to connect with two for the first time with functional protein only candle lights.
Speaker 3: The information Duomik provides has the potential to reveal the genetic drivers of the earliest proteomic responses to cancer and other diseases.
The information do home. It provides has the potential to reveal the genetic drivers of the earliest proteomics responses to cancer and other diseases.
Speaker 3: It provides for the first time the ability to sequence the highly active polyfunctional supercells that orchestrate DNA and response.
It provides for the first time the ability to sequence a highly active polyfunctional super cells that orchestrate the immune response.
Speaker 3: Based on our data, we plan to offer our duomic platform via early access and service in the second half of 2022, with a full duomic product launched in the middle of 2023.
Based on our data we plan to offer our Nuomi platform via early access service in the second half of 2022.
We'll do I'll make product launch in the middle of 2023.
Speaker 3: Our team is the foundation of everything we do at ISO Plexus.
Our team is the foundation of everything we do at plexus.
Speaker 3: People in culture are core to innovation. We have continued to attract a world-class pool of talent and made significant addition to our leadership team over the past few months.
People and culture are core to innovation, we've continued to attract a world class pool of talent and made significant additions to our leadership team over the past few months.
Speaker 3: We have strengthened our current position in the market and our prospects for scaling, by adding season leaders from various lifetimes of tools andomics companies to contribute to our operational excellence in global infrastructure this year of the...
We have strengthened our current position in the market and our prospects for scaling by adding seasoned leaders from various life Sciences tools and all makes companies to contribute to our operational excellence global infrastructure this year and beyond.
Speaker 3: Additionally, we have continued to strengthen our board with seasoned operators in the life sciences, tools, and all-mix fields, including Jason Myers, formerly CEO of ARCHERDX.
Additionally, we have continued to strengthen our board with seasoned operators in the life Sciences tools, and I'll make steel, including Jason Meyers former.
<unk> CEO of Archer Dx.
Speaker 3: Sonata Karia, formerly president of the Life Sciences Division at Life Technology.
That with a caveat, formerly president of Life Sciences Division at life technologies.
Speaker 3: and Michael Egghumb, formerly CTO of Danna R. Life Sciences in President of Paul Life Sciences.
And Michael Legg home, formerly CTO of Danaher Life Sciences, and President of Pall Life Sciences.
Speaker 3: Their unique and complimentary perspectives on technology expansion, healthcare innovation, and market development will be invaluable to high supply access as we accelerate and expand our market.
They are unique and complementary perspectives on technology expansion health care innovation and market development will be invaluable types of plexus, as we accelerate and expand our markets.
Speaker 3: Overall, we are excited about what is ahead for ice and plexus and our confidence that our technology platform enables our customers to catch repel our biology to accelerate advanced, curative medicine.
Overall, we are excited about what is ahead for <unk> and are confident that our technology platform enables our customers to capture powerful biology to accelerated advance curative medicines.
Speaker 3: I will now turn the call over to John for more details on our financials.
I will now turn the call over to John for more details on our financials.
Thanks, Sean.
Speaker 3: Total revenue for the third quarter of 2021 was $4.2 million, up 28% from 3.3 million in the prior year period. This brings our total year-to-date revenue for 2021 to 11.7 million, a 68% increase from the prior year.
Total revenue for the third quarter of 2021 was $4 $2 million up 28% from $3 3 million in the prior year period.
This brings our total year to date revenue for 2021 to $11 7 million, a 68% increase from the prior year.
Speaker 3: Product revenue was $3.9 million, a 29% increase compared to $3 million in the prior year quarter.
Revenue was $3 $9 million or 29% increase compared to $3 million in the prior year quarter.
Speaker 3: and service revenue with 300,000 compared to 250,000 for the prior year quarter.
And service revenue was 300000 compared to 250000 for the prior year quarter.
Speaker 3: Our commercial team continued to drive adoption and sold 22 instruments during the third quarter. We have now sold 172 instruments since initial commercial launch in late 2018.
Our commercial team continued to drive adoption and sold 22 instruments during the third quarter. We have now sold 172 instruments since initial commercial launch in late 2018.
Speaker 3: In the last two quarters, we have seen strong instrument growth due to onboarding and training of our commercial team, increasing customer account coverage and launching more products into the market.
In the last two quarters, we have seen strong instrument growth due to onboarding and training of our commercial team increasing customer account coverage and launching more products into the market.
Speaker 3: We are encouraged by the pace of customer adoption, demonstrating the versatility of our platform across a range of applications.
We are encouraged by the pace of customer adoption, demonstrating the versatility of our platform across a range of applications.
Speaker 3: Consumable revenue was $1.2 million for the quarter compared to $554,000 in the prior year period. We continue to see growth in consumable sales from both a larger installed customer base and from increased customer utilization.
Consumable revenue was $1 $2 million for the quarter compared to $554000 in the prior year period.
We continue to see growth in consumable sales from both a larger installed customer base and from increased customer utilization.
Speaker 3: In the near term, we are focused on increasing our user base, training customers, and growing our consumable test menu as we expand our functional cell library. All of these activities will help our customers advance their research programs and create the foundation for our long term recurring consumable revenue stream.
In the near term, we are focused on increasing our user base training customers and growing our consumable test menu as we expand our functional cell library.
All of these activities will help our customers advance their research programs and create the foundation for our long term recurring consumable revenue stream.
Speaker 3: Gross property for the third quarter of 2021 was $2 million compared to $1.8 million in the same period of 2020. Gross margin was 47% in the third quarter compared to 54% during the third quarter of 2020.
Gross profit for the third quarter of 2021 was $2 million compared to $1 $8 million in the same period of 2020.
Gross margin was 47% in the third quarter compared to 54% during the third quarter of 2020.
Speaker 3: The decline in gross profit was primarily due to increased cost of raw materials and increased inventory reserves booked in the quarter.
A client in gross profit was primarily due to increased cost of raw materials and increased inventory reserves booked in the quarter.
Speaker 3: Similar to others in our industry, we are starting to see pressures on the supply chain, specifically constraints that are obtaining certain key components for our products and R&D programs. These include increasing lead times.
Similar to others in our industry, we are starting to see pressures on the supply chain, specifically constraints in obtaining certain key components for our products and R&D programs. These include increasing lead times and higher prices. As a result, we have continued to build our inventory in order to fulfill instrument demand.
Speaker 3: As a result, we have continued to build our inventory in order to fill instrument demand in 2022 without disruption to the customer.
In 2022 without disruption to the customer.
Speaker 3: Despite the current environment, we expect our gross margin to improve over time as we ramp our commercial efforts and as recurring consumable sales become a larger component of our total revenue net.
Despite the current environment, we expect our gross margin to improve over time as we ramp our commercial efforts and as recurring consumable sales become a larger component of our total revenue mix.
Speaker 3: Over the next five years, we expect our gross margin to improve and settle into the low to mid 70%. We have a clear path to this goal and we continue to increase consumable margin and as consumables become a larger portion of our revenue.
Over the next five years, we expect our gross margin to improve and settle into the low to mid 70%.
We have a clear path to this goal and we continue to increase consumable margin.
And as consumables become a larger portion of our revenue.
Speaker 3: Operating expenses for the third quarter of 2021 were $21.9 million in increase of 173% compared to $8 million in the third quarter of 2020. The increase was primarily driven by headcount expansion across our business, centred in the commercial organization.
Operating expenses for the third quarter of 2021 were $21 9 million, an increase of 173% compared to $8 million in the third quarter of 2020. The increase was primarily driven by head count expansion across our business centered in the commercial organization.
Speaker 3: R&D expense increased by 2.2 million or 90% over the prior year period of which 1.4 million was associated with personnel and related expenses.
R&D expense increased by $2 2 million or 90% over the prior year period of which $1 4 million was associated with personnel and related expenses.
Speaker 3: SGNA expense increased by 11.6 million or 210% of which 7.4 million was associated with personnel in related expenses and increased marketing and promotional activities.
SG&A expense increased by $11 6 million or 210% of which $7 4 million was associated with personnel and related expenses and increased marketing and promotional activities.
Speaker 3: Our net loss was 20.2 million or $10.66 per share for the third quarter 2021 compared to 5 million or $3.16 per share in the third quarter of 2020.
Net loss was $20 2 million or $10 66 per share for the third quarter 2021, compared to 5 million or $3 16 per share in the third quarter of 2020.
Speaker 3: We ended the third quarter of 2021 with $40.7 million in cash on the balance sheet. As Sean mentioned, we completed our initial public offering in October , raising an additional 111 million of net proceeds.
We ended the third quarter of 2021 with $47 million in cash on the balance sheet.
Sean mentioned, we completed our initial public offering in October raising an additional $111 million of net proceeds.
Speaker 3: Looking ahead to the remainder of 2021, we expect full year revenue to grow by at least 61% compared to 2020.
Looking ahead to the remainder of 2021, we expect full year revenue to grow by at least 61% compared to 2020. We also plan to significantly increase our investment in the business to scale up our operations as we continue to ramp our commercial efforts.
Speaker 3: We also plan to significantly increase our investment in the business to scale up our operations as we continue to ramp our commercial efforts. Given the opportunities we see for commercial expansion of single cell proteomics and the large opportunity for the duomic platform, we expect 2022 operating expenses to be significantly higher. We'll continue to invest in the opportunity ahead, building world-class capabilities to execute our growth plan and meet customers' needs.
The opportunities we see for commercial expansion of single cell proteomics and the large opportunity for the dual make platform. We expect 2022 operating expenses to be significantly higher we will continue to invest in the opportunity ahead building world class capabilities to execute our growth plan and meet customer.
<unk> needs.
Speaker 3: At this point, I'd like to turn the call back to Sean for closing comments. Thanks, Sean. 2021 is...
At this point I'd like to turn the call back to Sean for closing comments.
Thanks, Sean.
2021 has been a pivotal year for ideal places and we believe this is just the beginning.
Speaker 4: Looking ahead to 2022, we will continue to leverage our commercial strategy to one, place more instruments and drive usage in high growth verticals across biofarmer, biotech, and academic medical centers to expand deeper into existing accounts through our land and expand strategy. And three, continue to innovate on our existing product roadmap to continue to offer products at the cutting edge of technology.
Looking ahead to 2022, we will continue to leverage our commercial strategy to one place more instruments and drive usage and high growth verticals across biopharma biotech and academic medical centers to expand deeper into existing accounts through our land and expand strategy.
And three continue to innovate on our existing product roadmap to continue to offer products at the cutting edge of technology.
Speaker 4: The wave of proteomics is leading to the knees for targeted proteomics single-cell level to provide the type of predicted early biological signals that will transform medicine that...
The wave of proteomics is leading to the need for targeted proteomics single cell level to provide the type of predicted early biological signals that will transform medicines that improve patient treatment.
Speaker 4: The Nebicide genomic discovery to proteomic applications in the clinic is also leading to a large opportunity for a novel, you can directly access that device, audio, mobile, test updates or
<unk> genomic discovery to proteomics applications in the clinic is also leading to a large opportunity for our novel dual make platform.
Speaker 4: As we connect three key biological paradigms, we are well positioned to capitalize on the high interest in proteomics, single cell biology, and multial.
As we connect three key biological paradigms, we are well positioned to capitalize on the high interest in proteomics single cell biology, and multi omics.
Speaker 4: We are committed to transforming this unique intersection of proteomics and single cell biology to change the future of medicine. With that, we will...
We are committed to transforming this unique intersection of proteomics and single cell biology to change the future of medicine.
With that we will now open it up to questions.
Speaker 1: As a reminder, if you'd like to ask a question at this time, please press the star, then the number one key on your touchtone telephone. To withdraw your question, press the pound key.
As a reminder, if you'd like to ask a question at this time. Please press. The Star then the number one key on your Touchtone telephone.
To withdraw your question press the pound key.
Our first question comes from Tejas Savant with Morgan Stanley.
Speaker 3: Hey guys, good morning. Chan, before we get into the details on some of the near-term dynamics here, I just wanted to ask you a big picture value proposition question. A lot of newer technologies have come to market, aiming to accelerate academic and bioform our research over the last couple of years. Each of these has its own advantages. They're all competing for the same budget dollars at the end of the day. So along rich dimensions of the Isolite and Isospark platforms, do you find that your platform is resonating best with your customers today?
Hey, guys. Good morning, Sean before we get into the details.
On some of the near term dynamics, Yes, I just wanted to ask you a big picture value proposition question.
Lot of newer technologies have come to market, you know aiming to accelerate academic and Biopharma research over the last couple of years. Each of these has its own advantages, they're all competing for the same budget dollars at the end of the day, so along breech dimensions off the isolate and ISO spot platforms do you find that your platform is resonating.
<unk> best with your customers today.
I can't say just I I think the main thing that we point to when we when we go to a customer site.
Speaker 4: Thanks, Aja. I think the main thing that we point to when we go to a customer site and we know they purchased our systems and use our systems is one unique data, the unique single cell proteomic data in particular.
No they they purchase our systems and use our system is one new unique data.
<unk> single cell proteomics data in particular.
Speaker 4: two, the proven utility of that data, and then three, the ability to actually get, let's call it an easy to use system with an accessible price point. And so if I go through the first, we're the first technology out there that's able to access the range or the comprehensive degree of these functional secreted proteins, chemokines, zytokines, growth factors, or phosphoproteins per single cell.
To the food and utility of that data and then three the ability to actually get let's call. It an easy to use system with an acceptable price point and so if I go to the first wounded first technology out there that's able to access the range or the comprehensive degree of these functional secreted pro.
<unk> came in kind of that kind of growth factors or fall.
Hospital proteins per single cell.
Speaker 4: relative to let's say bulk proteomics or flow cytometry which focuses on of course the surface micro phenotyping per cell.
Relative to let's say bulk proteomics or flow cytometry, which focuses on of course the surface of all casino typing herself.
Speaker 4: That unique data set that we have, if you just look at the relevant sort of clinically relevant literature out there, for example, the recent Journal of Clinical Oncology paper, you know, our immune profiling, let's call them...
That unique dataset that we have if you just look at the relevant sort of clinically clinically relevant literature out. There for example, the recent journal clinical oncology paper.
<unk> immune profiling, let's call them superhero cells has predicted things like long term response to cancer and that Jay Seo study, where for example flow cytometry was unable to and that unique access to the the superheroes cells that we're able to pick up and coupled it with excessive.
Speaker 4: have predicted things like long-term response to cancer in that JCO study where...
Speaker 4: For example, flow cytometry was unable to, in that unique access to the superhero cells that were able to pick up.
Speaker 4: and coupled it with an accessible bench top instrument and a price point that is accessible to a wide range of labs either for a higher throughput isolite or the lower throughput isospark system.
The bench top instrument at a price point that is accessible to a wide range of labs, either through a higher throughput isolate or the lower throughput I suppose sparc system makes it an attractive proposition to let's say at a critical component to what they might be doing in cell and gene therapy for predictive product potency when you can.
Speaker 4: makes it an attractive proposition to, let's say, add a critical component to what they might be doing in cell-engine therapy for predictive product potency, where you can't get it off of the standard bulk proteomics.
Can't get it off of the standard bulk proteomics flow cytometry or genomic systems and the same thing just for again the wide moving space of cancer immunology for data and many side by side studies, where we showed unique access to pretty only biology at the single cell level gives you a uniquely early signals and predictive.
Speaker 4: flow cytometry or genomic systems. In the same thing, just for, again, the wide moving space of cancer monology for data in many side-by-side studies, where we showed unique access to proteomic biology at the single cell level, gives you uniquely early signal of predictive information you are unable to get with flow cytometry and genomes.
Information.
Unable to get with flow cytometry and genomics.
Speaker 3: Got it. That's helpful. And then on the ISO Spark launch, Sean, any early color that you can share there has this impacted your placements of ISO light at all. And can you walk us through your expectations for the blended ASP impact both in the third quarter and into 22?
Got it that's helpful.
And then on the ISO spark launch Sean any early color that you can share there.
Has this impacted your placements of ISO light at all and can you walk us through your expectations for the blended ESP impact both in the third quarter and into 'twenty two.
Yeah.
Speaker 4: So a couple of things. The Isolite has been an exciting technology for us because as described, I think we've experienced two sides of the market, whereas the majority of our revenue today comes from biotech biopharma, relative to academia. But we noticed that the HIP hire throughput Isolite system.
So a couple of things the isolate its been an exciting technology for us because as described I think we've experienced two sides of the market whereas.
The majority of our revenue today comes from biotech and Biopharma relative to academia, but we noticed that the a chip higher throughput isolate system.
Speaker 4: represented sometimes a price point and a, let's say a throughput that was not necessarily needed for a smaller academic lab or a smaller biotech. And so the isolate system has really allowed us to get into those academic labs and we've seen an uptick in this recently. Since launch earlier this year in the end of Q1. And what we're seeing now is that
<unk> represented sometimes a price point and Ah, let's say a throughput there was not necessarily needed for a smaller academic labs are a smaller biotech and so the isolate system has really allowed us to get into those academic labs, and we've seen an uptick in this recently.
Since launch earlier this year and the end of Q1.
And what we're seeing now is that.
Speaker 4: The ISO Spark is, let's call it making accessible labs that typically can move at a quick sales cycle and don't have to go through normal capital committees based on the selling price. I think right now what we're focused on is continuing to grow the installed base as we have, we're at 172 instruments in the field through the NSQ-3.
The ISO spark is let's call it making acceptable labs that typically can move at a quick sales cycle and don't have to go to a normal capital committees based on the selling price I think right now what we're focused on is continuing to grow the installed base as.
As we have we're at 172 instruments in the field through the end of Q3.
Speaker 4: We won't be disclosing or releasing ASP on this call as well as the mix of Isolites versus Isolates and Sparks, but I can say that the Isolates and Sparks has been.
We won't be disclosing or releasing ASP on this call as well as the mix of isolates versus licensed parts, but I can say that the ico spark has been significantly advancing our cogs to proliferate our systems into these three verticals, we focus on Biopharma biotech.
Speaker 4: significantly advancing our cause to proliferate our systems into these three verticals we focus on, biofarba, biotech, and academic medical.
And academic medical centers.
Speaker 3: Got it. That's helpful. And then one final one on Duomic. You mentioned you've already started generating data. And I think you're expecting additional data that's it's see as well. But your early access program is unexpected to launch, I think until the third quarter of next year. So can we just walk us through, what remains to be done there? Or is it essentially just to buy you some time, as you, you know, you have a lot on your plate, ramping up sales of, you know, ISO Spark and ISO Lite here. And you just want to begin some cushion to generate a pipeline of projects that you then start with early access in the back off of 22.
Got it that's helpful. And then one final one on dual make you you mentioned you've already started generating data and I think they're expecting additional data to see as well.
But the early access program is unexpected to launch I think until the third quarter of next year. So can you just walk us through what remains to be done there or is it essentially just to buy you. Some time as you know you have a lot on your plate ramping up sales of.
ISO spark can isolate yard and you just want to bake in some cushion to generate a pipeline of projects that you then start with early access in the back half of 'twenty two.
So I'll I'll outline it is along the lines of what you're saying, but there's there's a specific innovation playbook that we developed the single cell proteomics network exercising with did you all make platform. So the commercial plan a plan for accessing the large do I'll make market, which represents as we discuss this.
Speaker 4: So all outline, it is a long line of what you're saying, but there's a specific innovation playbook that we developed with single cell proteomics that were exercising with the duomic platform. So the commercial plan for accessing the large duomic market, which represents, as we discussed, this $12 billion additional term.
12 million are additional Tam.
Speaker 4: is sort of patterned on what we early on did with single cell proteomics. So for one, until that early release access as a service, which will be generating some early revenue with selected amount of customers, we're going to develop key opinion leader data for about, you know, as we talked about the next year or so, showing a unique impact of the hyper-connected biology from functional proteomics.
Is sort of pattern on what we were early on did with single cell proteomics, So for one and two.
Till that early release access as a service, which will be you know generating some early revenue was selected them out of the customers will go to develop key opinion later data a key opinion leader data for about.
As we talked about next year or so showing the unique impact of the Hyperconnected biology from functional proteomics and for the first time to the sequencing driver of those functional proteomics.
Speaker 4: and for the first time to the sequencing driver of those functional proteomics. Second, as we launched early access service later next year, this is gonna be with a limited number of customers, just as we did with single-cell proteomics. And it's really what we're focused on is continuing the...
Second as we March early access service later next year.
Gonna be with a limited number of customers just as we did with single cell proteomics and it's really what we're focused on is continuing to.
Speaker 4: customer's interest in the that I supply this is known for. And like you mentioned, learning a lot from first the KOLs and then from our early access users, as we expand not only the, let's call it the ability to answer key questions from tumor biology, immunology, and central nervous system cells, but additionally, so that we're generating the, let's call it the entire application suite that comes with these cell types that we're offering.
Customer Centricity that is complex as it is known for and like you mentioned learning a lot from first the Kols and then from our early access users as we expand not only the let's call. It the ability to answer key questions, probably tumor biology, immunology and central nervous system cells, but additionally.
We're generating the let's call it the entire application suite that comes with these.
Cell types that we're offering.
Speaker 4: What that'll do for us, we believe is, similar to what we experience with our single-cell proteomics platform, we'll have what we need from a, you know, what's just called a holistic product.
What that'll do for US we believe is similar to what we experienced with our single cell proteomics platform will have what we need from a.
Let's just call it a holistic product.
Speaker 4: Stability shelf life, et cetera, to launch to the market in 2023 with our full product working on the isospark and isolite system. The one difference versus what we originally did with single cell proteomics when you think about it is we're now at a much larger scale than we were. We're also in a much larger awareness pool, us being well known for the work that we've done.
Stability shelf life et cetera to launch to the market in 2023 with our full product working on the ISO spark and isolate system. The one difference versus what we originally did with single cell proteomics. When you think about it is we're now in a much larger scale than we were we're also.
In a much larger awareness pool us being.
Well known for the work that we've done in proteomics with direct detection from single cells and of course, the much larger commercial team than we had with just a few employees. When we started launching single cell proteomics. What this is allowing us to do is we're going to be able to utilize the capabilities. We gained from our commercialization efforts with ice and sparkling ice.
Speaker 4: with direct detection from single cells. And of course, the much larger commercial team than we had were just a few employees when we started launching single cell proteomics.
Speaker 4: What this is allowing us to do is we're going to be able to utilize your capabilities, we gain from our commercialization efforts with ITSA Spark and Isolate and leverage our strength in single-soft proteomics. And then our initial channels for duomic. Eh?
So late and leverage our strength in single cell proteomics, and then our initial channels.
Or do ohmic represent.
Speaker 4: very similar total customers, via the BioFarm and Biotech and Economic Medical Centers, we do expect that as we expand in these centers, though, we get access to this further sort of sequencing discovery folk-focused market.
Very similar.
Total customers via the Biopharma biotech and academic medical centers, we do expand that we do expect that as we expand in new centers, though we get access to this further sort of sequencing discovery focused market there were.
Speaker 4: that our plan is to help bridge with going on with the genomic cell outlets today into clinic, which requires a lot of these functional proteins that we have on our technology by putting the two together for the first time, which we're calling our, you know, discovery bridge led by the function of cell library. Got it, very helpful. Thank you.
Our plan is to help bridge, what what's going on with the genomic cell Atlas today into clinic, which requires a lot of these functional proteins that we have on our technology by putting the two together for the first time, which we're calling our discovery bridge led by the functional cell library.
Got it very helpful. Thank you.
Tejas.
Our next question comes from Puneet <unk> with SBB Leerink.
Speaker 5: Yeah, hi, Sean. Thanks for taking the question and congrats as a first quarter as a public company.
Yeah, Hi, Sean Thanks for taking the question then.
For the first quarter as a public company.
Speaker 5: So my first question is on panel expansion, you talked a little bit about DO-MAC. Maybe just at a high level, help us understand how you think about prioritizing the panel expansion on chips. How do you prioritize these areas versus research topics given the plethora of antibodies that are available out there?
So.
So my first question is on you know panel expansion, you're talking a little bit about do you make them, maybe just at a high level help us understand you know.
How you think about prioritizing.
The panel expansion on on chips, how do you sort of how are you prioritizing disease areas versus research topics given the plethora of antibodies that are available out there.
Yeah.
Speaker 4: Thanks, Veneet. So a couple of ways to think about this. As we started generating
Thanks, Amit so a couple of ways to think about this as we started generating Ah.
Speaker 4: a language around how we're expanding what we're doing for single-file proteomics. We're discussing what we're calling...
Our language around how we're expanding what we're doing for single cell proteomics.
We're discussing what we're calling our functional cell library, and we put a lot more information.
Speaker 4: functional cell library and we'll put a lot more information around that in the coming weeks.
Information around that in the coming weeks.
Speaker 4: But this has been something in process for quite a while. And what this means is, we're looking at.
But this has been something in process for quite a while.
And what this means is.
We're looking at the responses on the from each of these proteomics cell types across a range of cells. So we really started with T cells, but if you look at the work flows we provide across the functional cell library, meaning all of the human proteome likelihood himself that complement the genomic cell Atlas.
Speaker 4: the responses are on the, from each of these proteomic cell types, across a range of cells. So, you know, we really started with p-cells, but if you look at the workflows we provide across the functional cell library, meaning all of the human proteomically driven cell that complement the genomic cell atlas.
Speaker 4: We've now put out a lot of work load and protocols in the corresponding panel run, you know, P cell, natural killer cells, monocytes, cancer associated.
We've now put out a lot of workflows and protocols and a corresponding panels on T cells natural killer cells monocytes.
Cancer associated fibroblast, a range of immune armamentarium against cancer.
Speaker 4: A range of the immune armamentarium against cancer and even more broadly against disease.
And even more broadly against disease.
Speaker 4: And what our focus is on is continuing to develop, there is a wide array of proteomic analytes as you mentioned, and what we're seeing is isoplexis is in a way benefiting from this wave of bulk proteomics on the discovery end that's then driving the need to say, okay.
And what our focus is on is continuing to develop there there is a wider array of proteome. The candle lights as as you mentioned and what we're seeing is I used to places us in a way benefiting from this wave of bulk proteomics on the discovery and that's been driving the need to say, okay. What single cells are.
Speaker 4: What single cells are delivering these proteins and can I get earlier signals from those cells that are actually orchestrating response? And so we are developing a greater process to not only widely increase.
Delivering these proteins and can I get earlier signals from those the cells that are actually orchestrating response, and so we are developing a greater process to not only increase wildly increase Michelle menu, we have but also increase the proteins that are accessible from those sell menus.
Speaker 4: cell menu we have, but also increase the proteins that are accessible from those cell menus. The typical way we prioritize it is, we already have a long list of the cell menu that's necessary to drive our business. And we notice what we talk to our
Typical way, we sort of prioritize it is we already have a long list of the shell menu, that's necessary to sort of drive our business and we noticed what you talked to are.
Speaker 4: customers have close conversations with those customers and we determine what proteins are required to capture the comprehensive function of those single cells in the cell menu and then we kind of derive the panels thereof for our single-cell proteomic panels.
A couple of customers have close conversations with those customers and we.
We determined what proteins are required to capture the comprehensive function of those single cells and Michelle menu and then we kind of derive the panels thereof for a single cell proteomics panels.
I hope that it quite frankly.
Speaker 5: Yeah, no, that was that was super helpful. Just a brief question on on budget flush. I, you know, given the size of the sales force and current opportunities that you're looking at there, I'm just wondering if you're seeing any, you know, budget flush dynamics and biopharma, given the pricing of Isolite and Isospark.
Yeah, No that was super helpful and just a brief question on <unk>.
Budget flush.
No.
Given the size of the Salesforce and current opportunities that you are looking out there I'm just wondering if you're if you're seeing any.
You know budget flush dynamics in Biopharma and given the pricing of isolate an ISO spark which is pretty attractive I'm just wondering if you're seeing.
Speaker 5: which is pretty attractive. I'm just wondering if you're seeing, you know, increase in pull from that.
Increase in pull through pull from that in.
Speaker 5: In the quarter here, you know, from labs that are investing into ELISA's and close by telemetry and then potentially looking at these two instruments as opportunities that they can pursue in single cell proteomics.
In the quarter here from.
Some labs that are investing into alliances in flow cytometry, and then potentially looking at these two instruments as opportunities that they can.
Pursuing single cell proteomics.
Speaker 4: While I will comment on numbers directly about the quarter, as we close out the year, what I will say is, you're right to notice that the majority of our business is biotech, biopharma, as we alluded to in our previous filings. What we do see is, as we've come out with the...
Well I won't comment on.
<unk> directly about the quarter.
As we close out the year, what I will say is you're right to notice that the majority of our business is is biotech biopharma as we alluded to in our previous filings.
What we what we do see is as we've come out with the.
Speaker 4: literature that we've recently come out with, which is the major medicine journals that emphasize isop?xuses, polyfunctional strength, are super-hero cell detection.
Literature that we've recently come out with which is the major medical journals that emphasize ISIL places polyfunctional strength. Our superheroes held detection is really important for for til therapy against solid tumor and that was one nature of that paper. The other nature Medicine clinical study was again, emphasizing and Theres a quote.
Speaker 4: is really important for tilt therapy against solid tumor. Now, that was one nature med paper. The other nature medicine clinical study was, again, emphasizing there's a quoted in about, your engineering iterations should use this, isoplexis.
And about your engineering iterations shouldn't use this.
ISIL, Texas.
Speaker 4: supercell i.e. the poly-functional strength in order to guide engineering iterations of cars.
Supercell Polyfunctional strength in order to guide engineering iterations of cars. What we're seeing is that there's a really a burgeoning number of biotech biopharma interested in the cell and gene therapy area.
Speaker 4: What we're seeing is that there's a really a burgeoning number of biotech bioparma interested in the saline gene therapy area. You know, it's coming that we're the emerging standard and we haven't even agreed out. So we are seeing quite a bit of interest. I reiterate the guidance that we've put forward, for the four year, at least 61% revenue growth. And what I would say an admission to that is,
It's coming that where the emerging standard we have a unique readout. So we are seeing quite a bit of interest.
I reiterate the guidance that we've put forward you know for the full year at least 61%.
Revenue growth and what I would what I would say in addition to that is there is a.
Speaker 4: a tremendous interest to leverage, I think, unique and enabling technologies right now that are an attractive price point. And I think we're right in the sights of a number of biotech biopharma. And also, if you think about it.
Tremendous tremendous interest to leverage I think unique and enabling technologies right now that are in an attractive price point and I think we're right in the sites of.
A biotech Biopharma and also if you think about it there's just a tremendous investment in later stage development and for cell therapy advanced process sciences to improve the product itself and so I think internationally.
Speaker 4: There's just a tremendous investment in later stage development and for self therapy, some advanced process sciences to improve the product itself. And so I think internationally, we're experiencing a bit of that right now, but I don't want to sort of speak to any numerical details about what we're seeing in biotech baths.
We're experiencing a bit of that right now, but I don't want to sort of speak to any numerical details about what we're seeing in biotech biopharma.
Speaker 5: Sure, that's helpful. And then just last one, could you elaborate a bit more on the commercial team? Where do you stand in terms of the total headcount there and frontline sales force? And given the recent hires, how should we think about the productivity ramp among that group? Thanks so much.
Sure. That's helpful. And then just last one could you elaborate a bit more on the commercial team where do you stand in total in terms of the total.
Head count there and frontline sales force and given the recent hires how do you how should we think about the productivity.
Ramp among among that group. Thanks, so much.
Speaker 6: Hey Puneet, it's John and I'll take a shot at that one. So you will see in the 10Q that we'll file later this week, our total head count for the sales and marketing team. We are not breaking out more specific details around that, sales reps, et cetera. But I will say, and kind of following up on Sean's last comments, that we are confident that the team we have in place is equipped to achieve our commercial goals going forward.
Hey, Puneet, it's John and I'll take a shot at that one so you will see in the 10-Q that we'll file later this week, our total head count for the sales and marketing team. We are not breaking out more specific details around that sales reps et cetera.
But I will say and then kind of following up on Sean's last comments that we are confident that the team. We have in place is equipped to achieve our commercial goals goals going forward.
Okay Super helpful guys. Thanks.
Thanks Puneet.
Speaker 1: Our next question comes from Max the Souti with Cowan Income.
Our next question comes from Max Masucci, with Cowen and company.
Speaker 7: Hey, Sean and John congrats on a strong showing in the public arena.
Hey, Sean and John Congrats on a strong showing in the public arena.
Speaker 7: Just to start on the guide, can we just walk through maybe with a bit more detail the assumptions and the implied Q4 guidance? It would be great to hear your expectation for Q4 placements, whether we can expect continued strength for IsoSpark and then any expectations around sequential growth in consumables.
To start on the on the guide.
Just walk through maybe with a bit more detail the assumptions and the implied Q4 guidance be great to hear your expectation for Q4 placements you know whether we can expect continued strength for for ISO spark and then any expectations around sequential growth in consumables.
Speaker 7: It just has the 61 in Serenity Place in the first nine months of the year go live. And as you know, the recent publications and in nature and the journal of Clinical Oncology are digested by your customers.
And just as the 61 instruments you place in the first nine months of the year go lives I mean as you know the recent publications in nature in the journal of clinical oncology or digested by by your customers.
Speaker 6: Hey, Max, John , let me pick up on a couple of those points. I think, you know, just reiterate the guidance for 2021, the full year. So 61% total year over year growth. Obviously you can see our retotal revenue for the first nine months of the year 11 point.
APAC to John let me pick up on a couple of those points I think just reiterate the guidance for 2021, the full year, so 61% total year over year growth. Obviously, you can see our total revenue for the first nine months of the year $11.7 million.
Speaker 6: seven million dollars. Um, and again, at this point, we're not giving specifics about, you know, the number of placements and the breakout, you know, between the light and the sparks. So I'll talk a little bit earlier about the spark and, you know, we're pleased with the uptake that we've seen on the spark after the initial launch earlier this year. You know, it's basically doing its job for us, helping us access, you know, the academic and smaller.
And again at this point, we're not giving specifics about the number of placements and the breakout between the light and the spark Shawn talked a little bit earlier about the spark and we're pleased with the uptake that we've seen on the spark after the initial launch earlier this year.
Basically doing its job for us, helping us access the academic and smaller biotech market. So that helps us in terms of placements and obviously placements critical to setting the stage for the future recurring consumable sales.
Speaker 6: biotech market so that helps us in terms of placements and you know obviously placements critical to setting that stage for you know the future recurring consumable sales
Speaker 6: I'm not sure if you were asking about 2022. I think again there, we're not prepared on this call to give formal guidance, but we'll say that as we close out the year and thinking about the 2021 full year guidance, we're building a strong pipeline of prospective customers and we certainly expect to continue our commercial momentum in the next year.
I'm not sure. If you were asking about 2022, I think again, there we're not prepared on this call too.
Give formal guidance, but we will say that as we close out the year and thinking about the 2021 full year guidance.
Yeah.
Building, a strong pipeline of prospective customers and we certainly expect to continue our commercial momentum into next year.
Great.
Speaker 7: Yeah, one other follow up as to John's comment. And we'll reiterate a couple things on consumable pull through. So we're of course seeing growing utilization within our expanded call base.
Yep.
One other follow up to John's comment and we'll reiterate a couple of things on consumable pull through so we're of course seeing growing utilization within our expanded installed base.
Speaker 4: Through as we discussed. Fourth through half one of twenty one or TM consumerable pull through is around Thirty eight thousand.
As we discussed before through half one F. 'twenty one of our TTM consumable pull through was around 38000, I think one important thing just to think of the workflow. When you asked about sort of the installs now when we place an instrument and this is part of building that commercial team John alluded to head count.
Speaker 4: I think one important thing, just to think of the workflow when you ask about sort of the installs. Now we'll replace an instrument, and this is part of building that commercial team John alluded to head count.
Speaker 4: Our instrument sales team passes off to our field application specialists, our consumable sales.
Our instrument sales team passes off to our field application specialists, our consumable sales team and our growing service team, which we've really built out under our new.
Speaker 4: in our growing service team, which we've really built out under our new
M D.
Speaker 4: VP of customer support, Michelle Reid, who is the lead customer support in Coyagin.
P of customer support Michelle Lee, who is the lead customer support at Qiagen.
Speaker 4: What we've been able to do is invest early, educate key users in drive, consumable usage shortly after install. So that's really a goal of ours. The other.
Been able to do is invest early educate key users and drive consumable usage. Shortly after install so that's that's really a goal of ours.
The other thing is our.
Speaker 4: you know our expanding or vastly expanding functional cell library again will want more information on this in the near future is important to say it tries more comprehensive
Our expanding or vastly expanding functional cell library again will want more information on this in the near future is important to say that drives more comprehensiveness.
For the customer sites. It drives I would say more lab users to have to want access to the system of course as they see the publication literature that happens that happens naturally as well again driven by our consumable sales force and we do see a clear path to our long term goal of that 75000 and consumable pull.
Speaker 4: that happens naturally as well. Again, driven by a consumable Salesforce. And we do see a clear path to our long-term goal of that 75,000 in consumable pull-through. As we achieve that path in the next...
True.
We achieved that patent in the next few years, one other thing to think about it.
Speaker 4: a few years. One other just thing to think about is, we do see customers and expect customers to be growing their utilization over time.
We do see customers and expect customers to be growing their utilization over time, our focus will remain again as you alluded to an expanding our installed base.
Speaker 4: Our focus will remain, again, as you alluded to, on expanding our installed base, leveraging our ability to land and expand, and really capitalizing on that razor blade model over time, as awareness of the high need for our technology also expands across key verticals.
Leveraging our ability to land and expand and really capitalizing on that razor razor blade model overtime as awareness of the high need for our technology also expanded across key verticals.
Speaker 7: Great. And then, you know, understanding that we're still in early days here, but can you give us a sense for the early performance or capabilities you've observed for that, the duomic proof of concept product? And any feedback you've received following the data release at AGBT in September or even from any KOL that have had the chance to use the proof of concept product?
Great and then.
They were still in early days here, but can you give us a sense for the early performance or capabilities you've observed for.
The proof of concept product and maybe any any feedback you've received following the data released at <unk> in September our or even from any.
Any kols and have had the chance to use the proof of concept product.
Speaker 4: So we have some early responses since we finally began introducing the data. I think the first that comes out, we reflected this in a much larger survey that we had instituted with one of our consulting partners, is that
So we have some early responses since we finally began introducing the data.
I I I think the the first that comes out and we reflected this in a much larger survey that we had instituted with one of our consulting partners is that.
Speaker 4: the nature of being able to connect in each single cell, the sequencing information directly to some of these functional proteomic analytes that we analyze, right? The cytokine is chemokine.
The nature of being able to connect it.
Each single cell sequencing information directly to some of these functional proteonomic analytes that we analyze right beside it kind of became a guidance from immune cells or the phosphate proteins is driving me potentially logistic tumor cells.
Speaker 4: from immune cells or the phosphoprode team, driving these potentially resistant tumor cells, that's very valuable because it's not accessible today on today's platform. It's built on the strength of our proteomic barcoding technology to detect those analytes you need at reef-from-single cells. And then leverage some of the recent work and accelerating duolmic to pick up the sequencing information.
That's very valuable because it's not acceptable today on today's platform. It's built on the strength of our Proteonomic Barcoding technology to detect those analytes you need to be from single cells.
And then leverage some of the recent work and accelerating do I'll make to pick up the sequencing information.
Speaker 4: So what we've found is that that unique data that's connecting those two parts of the biology is a clear known need in the known need in the market which we're excited about because what we've seen is as we release
What we've found is that that unique data connecting those two parts of the biology.
Is it clear no need in the node need in the market, which we're excited about because what we've seen is as we release of course, you know press releases and then we released the dataset.
Speaker 4: Of course, you know, press releases and then we release the data set. Key opinion readers are coming back wanting access to the system right away. Again, telling us they want to include this key data, even if it's from a few samples in publication literature, because it's again adding a key piece of the equation of.
Key opinion leaders, who are coming back wanting access to the system right away again, telling us. They want to include this key data even if it's from a few samples in publication literature, because it again, adding a key piece of the equation of if you. If you know there are proteomics drilling cells in the body it looked very different than just that.
Speaker 4: if you know there are proteomically driven cells in the body.
Speaker 4: They look very different than just the genetically driven cells themselves. Do you want to detect that? You do also want to know specific to that cell. What are the gene drives?
Genetically driven cells themselves do you want to detect that you do also want to know specific to that itself. What are the gene drivers and so for example, releasing that data set in the tumor.
Speaker 4: And so, for example, the leasing the data side and tumor, there's these downs.
These downstream.
Speaker 4: you know again future applications where if you can understand the gene drivers driving potentially resistant to ourselves you can start editing things in those to myself you can start understanding the pathways that drive the most problematic subsets of cells you would normally miss the bulk where you would normally miss if you didn't have access to that proteomic information
Future applications, where if you can understand the gene drivers driving potentially resistant tumor cells.
Can start editing things in those tumor cells, you can start understanding the pathways that drive the most problematic subset themselves you would normally listen the bulk where you would normally miss if you didn't have access to that proteomics information. So there's a lot of excitement I think what we're gonna do is continue to evangelize the technology evangelize These data.
Speaker 4: So there's a lot of excitement. I think what we're going to do is continue to evangelize the technology, evangelize these data, show how the system works, and put out a lot more information on it so that there's transparency in the market. And what we see is that creates a very nice...
So how the system works and put out a lot more information on it so that there is transparency in the market.
What we see is that creates a very nice.
Speaker 4: series of pent-up manned as we discussed earlier for what we're doing early actions in the service later next year and finally the product in the following year. Great, thanks for taking the questions.
Series, a pent up demand.
As we discussed earlier for what we're doing early access to the service later next year and finally the product in the following year.
Great. Thanks for taking the questions.
Okay.
Our next question comes from Vijay Kumar with Evercore.
Speaker 6: Hey guys, thanks for taking my question. Sean or John , maybe one now on the queue itself. Look like instrument revenues were down sequentially consumable for revenues for a flat, a <expletive> 1.2. Maybe talk about any sequinsure trends here, two queue or just two queue, was there some timing element, which impacted the performance in the queue?
Hey, guys. Thanks for taking my question.
Sean or John maybe one on the.
The Q itself looks like.
Instrument revenues were down sequentially.
Consumable revenues for Florida shipped one point too.
Maybe talk about any sequential trends here Q3, Q was there some timing element.
Would you Patrick.
The performance in the queue.
So I'll address that Vijay as you mentioned.
Speaker 4: I will address that VJ. As you mentioned, we're still at a relatively small instrument base where timing issues, for example, with an instrument delivery could impact revenue. So yes, potential timing issues have that impact today. As I mentioned, we are still operating in the environment with the pandemic seeing some restrictions in certain geographies, which can drive those timing issues. I would say that if we look back at the last...
We're still a relatively small instrument base, where timing issues for example, with an instrument delivery could impact revenue. So yes.
Potential timing issues have that impact today as I mentioned, we are still operating in the environment with the pandemic seeing some restrictions in certain geographies, which can drive those timing issues.
I'd say this if we look back at the last nine months, we're growing 68% year to date with strong progress. So far in 2021, we're focused on the pipeline that we're really generating due to the ico spark launch with the isolate system.
Speaker 4: When growing 68% year-to-date, we've strong progress so far in 2021.
Speaker 4: We're focused on the pipeline that we're really generating due to the ISIS-Bunk launch with the ISIS-Lite system.
Speaker 4: around the bio from a biotech, especially in the final quarter of the year, as well as more broadly academia, which we've seen the strong surgeon get in the isospark. So, you know, we sold those 61 units through the end of Q3 versus 57 units for the entire year of 2020. And I also think in poor-
Around the Biopharma biotech, especially in the final quarter of the year as.
As well as more broadly academia, which we've seen a strong surgeon given the ice with spark.
So we sold those 61 units through the end of Q3 versus 57 units for the entire year of 2020 and I also think importantly.
Speaker 4: you know, when you think of our expansion of the usage
When you think of our expansion of the usage.
Speaker 4: We put a lot of new members of the team out there. Those people are getting trained very quickly. We've expanded the accessibility to many different cells in single cell proteome, including our functional cell library.
We put a lot of new members of the team out there those people are getting trained very quickly with <unk>.
Expanding the accessibility to many different cells in single cell proteomics, using a functional cell library all of that has happened quite quickly and again. This is very complementary to whats happening in the cell Atlas today.
Speaker 4: All that's happened quite quickly and again, this is very complimentary that what's happening in the cell address today. So I'm now in the functional proteomics cell library that we're developing.
The functional proteomics cell library that we're developing that has driven a 199% year over year growth in consumable revenue through the end of Q3. So what we're going to focus on is just continuing to build the pipeline continued to expand our commercial coverage and continuing to make sure that we can mitigate any sort of timing.
Speaker 4: That has driven 199% your over your growth and consumable revenue through the end of Q3.
Speaker 4: So what we're going to focus on is just continuing to build the pipeline, continuing to expand our commercial coverage, and continuing to make sure that we can mitigate any sort of timing issues that we see or constraints throughout the world. But we do feel strongly positioned for Q4 and beyond, given the momentum we have.
Issue that we see are constrained throughout the world, but we do feel strongly positioned for Q4 and beyond given the momentum we have.
Speaker 6: That's helpful comment Sean. Just along those lines, you know, climbing element was human. This is the supply chain. The implied Q4 revenue is around roughly five million that's a sequential step up. And any any of risk of those numbers, what kind of visibility do we have, you know, considering the environment and potential for supply chain disruption?
That's that's helpful common Sean just along those lines.
<unk> on them and I'm, assuming this is supply chain.
The implied Q4 revenue is around roughly $5 million.
The sequential step up in.
Any risk of those numbers, what kind of visibility do we have.
The environment and potential for a supply chain disruption.
Speaker 4: So I'd say a couple things. We do feel confident in Q4, which is why we're reiterating that guidance. We do feel confident in the multi-quarter ramp ahead. And as you mentioned, there's always optical maneuver in COVID is intensified. Some of these restrictions, especially the supply chain.
So so I'd say a couple of things.
We do feel confident in Q4, which is why we're reiterating that guidance.
Do you feel confident in a multi quarter ramp ahead.
As you mentioned Theres always opticals obstacle to maneuver and Covid has intensified.
Some of these restrictions, especially with the supply chain.
Speaker 4: Two things, the proteomic platform remains very strong. We're seeing wide interest for our instrumentation, especially end of year biotech biopharma. Duolmic is also representing this interesting sort of evolution where customers see we're using it on the spark. The customers recognize that we're moving more and more into the discovery room, which remains attractive to those folks that long-term want many, many analytes across the connected biology continuum.
Two things the proteomics platform remains very strong we're seeing wide interest for our instrumentation, especially end of year biotech biopharma to all make US also representing this interesting sort of evolution, where customers see we're using it on the spark the customers recognize that we're moving more and more into discovery realm, which remains.
You know attractive to those folks that long term want many many analytics across the connected biology continue them.
Speaker 4: If I just address the COVID items, just a couple items. So, certain countries do have tighter restrictions, supply chain being impacted worldwide, but we have taken steps to ensure these risks.
If I just addressed the COVID-19 items, just a couple of items. So certain countries do have tighter restrictions supply chain being impacted worldwide, but we have taken steps to ensure these risks wont have a meaningful impact on our business supply chain wise, we are adding a lot of inventory right now as John mentioned to call it really the res.
Speaker 4: won't have a meaningful impact on our business. Supply chain wise, we are adding a lot of inventory right now, as John mentioned, to the call. Really the reason for that.
For that is we feel strongly we need to satisfy the heavy demand for what we're doing from what we have in 2022 and beyond we feel confident we're going to be in a position to do that.
Speaker 4: We feel strongly we need to satisfy the heavy demand for what we're doing, for what we have.
Speaker 4: in 2022 and beyond. We feel confident we're going to be in the position to do that. We brought on a new head of operations, Anthony Gautilano. He was previously a leadership in operations at Prokenelmer. And that coupled with a broader logistical team throughout the world and logistical partners.
We brought on a new head of operations Anthony Colorado. He was previously leadership and operations at Perkin Elmer and got.
<unk>, coupled with a broader logistical team throughout the world and logistical partners.
Speaker 4: Now we do feel confident we will be able to overcome sort of what's called logistical problems that exist just within COVID and restriction.
We do feel confident we will be able to overcome sort of let's call. It a logistical problems that exist just within COVID-19 and restrictions.
Speaker 4: Finally, just in terms of educating and reaching customers to get consumer pull-through up and running, we have added significant support staff in global regions to train customers locally, get them up to speed to ensure that consumable usage without those constraints of international travel. So we have been pretty focused on that, BJ.
Finally, just in terms of educating and reaching customers could get consumable pull through up and running we have added significant support staffs and global region to train customers locally get them up to speed to ensure that consumable usage without those constraints with international travel. So we have been pretty focused on that and P. J.
Speaker 6: I'm just going to turn it in the next one. One on, I saw the FCC commentator you guys put out.
And then Sean one on.
I saw the SEC comment letter you guys put out.
Speaker 6: Are those comments or those normal? I don't have a context to understand if this is part of the process. And there were some language around, you know, risks associated with technology, margin rates.
Are those comments or those normal I don't have a context to understand if this is part of the processing.
There was some language around.
You know risks associated with technology margin rates.
Speaker 6: Maybe you stop some, if you could just elaborate any rest on the technology, Martin writes that seem new to me, that would be helpful.
Maybe just start some if you could just elaborate any any risks on the technology Martin writes that seem you commute that'd be helpful.
Speaker 4: Yeah, I think this relates overall to broader intellectual property.
Yeah, I think I think this relates overall to broader intellectual property re.
Speaker 4: risks throughout the United States that don't necessarily just pertain to Isle Plexus.
Risks throughout the United States that don't necessarily just pertain to isolate likes us I mean, I'll say, a couple of things and I'll refer to margin rates. So so first the.
Speaker 4: I mean, I'll say a couple of things and I'll refer to March and Rights. So first, our, what we've done over the last few years is build up a substantial intellectual property portfolio with our own issued intellectual property around single cell proteomics and multiomics in all of the major life sciences regions throughout the world, as well as exclusively in licensed IP, which also covers our product. So our picket sense is very strong.
Our what we've done over the last few years is build up a substantial intellectual property portfolio with our own issued intellectual property around single cell proteomics and multi omics.
In all of the major life sciences regions throughout the world.
As well as exclusively in license IP, which also covers our products. So our picket fence is very strong.
Speaker 4: You know, there's various facts and I'm not going to claim to be the world's experts in this world to talk to our legal team, but there's various facts and related items which have certain implications within a like full property on licensed IP from the university. So I do think that these risks that exist are really just part of what any company goes through when they license university technologies. But again, from a business risk.
Theres various tax and I'm I'm not going to claimed to be the world's experts and this will have to talk to our legal team, but there's various action related items, which.
Has certain implications of intellectual property on.
Licensed IP from University, So I do think that these risks that exist.
Really just part of what any company goes through when they licensed University of technology, but again from a from a business risks. These are our.
Speaker 4: These are our core IP, both at University and licensed and isoplexus, and these represent from all of our close advisors at the top here legal firms we work with, strong protection versus anyone else trying to do what we do and also strong freedom to operate.
Core IP, both University in license counter ISIL plexus, and these represent from from all of our.
Close advisors at the top tier of legal firms, we work with strong protection versus anyone else trying to do what we do and also strong freedom to operate.
Speaker 6: that's helpful if I could just get one last one. Perhaps John , gross margins down 600 basis points. You mentioned in a supply chain material cost as well as inventory reserves. Do we know what portion was that material cost versus other reserves? What were the reserves charges for and when do we expect those charges to a rubur?
That's helpful. If I could just one last one perhaps for John.
Those margins down 600 basis points.
You mentioned.
Supply chain material cost as well as inventory reserves.
Do we know what portion was something material costs, where the reserves are.
The reserve charges for and when do we expect.
Those charges to reverse.
Speaker 8: Yet, hey, B.J., so it really is the impact of the margin does really revolve around those two elements, increase in raw material costs.
Yeah.
Yeah, Hey, Vijay so it really is.
The impact on the margin does really revolve around those two elements increase in raw raw material costs as well as the inventory reserves and.
Speaker 8: as well as the inventory reserves. And I'll just say on the reserves, I mean to your point, we took that charge through the third quarter P&L and we did that as our inventory balances have gone up to about $20 million. So just prudent accounting to reserve for excess or potential obsolete.
I'll just tell you just on the reserves I mean to your point we.
We took that charge through the third quarter P&L and we did that as our inventory balances have gone up to about $20 million. So just prudent accounting you know to reserve for excess or potential obsolete.
Speaker 8: inventory, you know the the components that we've been building in inventory. I think Sean mentioned You know, they're they're hardware they're long shelf life You know Component so we don't see a risk there that we're writing stuff off So we do think we have inventory that we will utilize as we fulfill 2020 Demand and you know at some point VJ I don't know if it comes back in terms of a reversal, you know or you know, we just have that on the balance and she you know against our future inventory balance
Inventory.
The components that we've been building into inventory I think Sean mentioned.
There are hardware there long shelf life.
Component. So we don't see a risk there that we're writing step up. So we do think we have inventory that we will utilize as we fulfill 2020 demand and at some point Vijay I don't know if it comes back in terms of a reversal.
Sure.
Have that on the balance sheet.
Against our future inventory balance.
Speaker 6: That's helpful comments Sean. It looks like there's more conservatism on the accounting side. That's it from my side gentlemen, thank you.
That's helpful common shot and it looks like this is more conservatism on the accounting side.
That's it from my side gentlemen take care.
Thanks P J.
Speaker 1: That concludes today's question and answer session. I'd like to turn the call back to Sean McCabe for closing remarks.
That concludes today's question and answer session I'd like to turn the call back to John Mccain for closing remarks.
Speaker 4: Thanks everyone, we really appreciate everyone joining. Look forward to meeting you in the coming weeks. You'll see it at the upcoming Ever Code Conference. And the last thing is, if we're for the first time, we're putting our investor presentation on our website. So if you'd like to review and flip through, that'll be up today. And we look forward to moving forward with the business. We're excited and we'll all talk soon.
Thanks, everyone. We really appreciate everyone joining us look forward to meeting you in the coming weeks.
Youll see the upcoming Evercore conference and the last thing is.
For the first time, we're putting our investor presentation on our website. So if you'd like to review and flip through that'll be up today and.
We look forward to moving forward with the business, we're excited and we'll all talk soon.
Speaker 1: This concludes today's conference call. Thank you for participating. You may now, this gonna...
This concludes today's conference call. Thank you for participating you may now disconnect.
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