Q1 2022 Thermogenesis Holdings Inc Earnings Call
Good day and welcome to the Thermogenesis Holdings Conference call and webcast to review financial and operating results for the first quarter ended March 31st 2022, as a reminder, all participants will be in listen only mode.
Speaker 1: Good day and welcome to the Thermogenesis Holdings conference call and webcast to review financial and operating results for the first quarter ended March 31, 2022. As a reminder, all participants will be in listen-only mode.
Speaker 1: There will be an opportunity to ask questions at the end of today's presentation. If you would like to ask a question, please press star, then one on your phone. If you wish to withdraw your question, please press star, then two.
There will be an opportunity to ask questions at the end of todays presentation. If you would like to ask a question. Please press Star then one on your phone.
If you wish to withdraw your question. Please press Star then two.
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As a reminder, this conference call is being recorded.
Speaker 1: I would now like to turn the conference over to our host, Paula Schwartz of RX Communications. Please go ahead.
I would now like to turn the conference over to our host Paula Schwartz of Rx Communications. Please go ahead.
Speaker 2: Thank you, operator. This conference call contains forward-looking statements within the meaning of the federal securities laws. The company's actual results may differ materially from those projected in the forward-looking statement.
Thank you operator. This conference call contains forward looking statements within the meaning of the federal Securities laws. The company's actual results may differ materially from those projected in the forward looking statements additional information concerning factors that might cause actual results to differ materially from those in the forward looking statements is contained in the company's periodic reports.
Speaker 2: Additional information concerning factors that might cause actual results to differ materially from those in the forward-looking statements is contained in the company's periodic reports filed with the Securities and Exchange Commission.
With the Securities and Exchange Commission.
The information presented today is time sensitive and is accurate only as of the date of this call may 19.
Speaker 2: The information presented today is time sensitive and is accurate only as of the date of this call, May 19.
Speaker 2: 2022. If any portion of this call is being rebroadcast, retransmitted, or redistributed at a later date, Thermogenesis will not be reviewing or updating this material. Participating on today's call are Dr. Chris Hsu, Chief Executive Officer, and Jeff Kabal, Chief Financial Officer. I'd now like to turn the call over to Chris. Please go ahead, Chris.
'twenty two if any portion of this call is being rebroadcast retransmitted or redistributed at a later date thermogenesis will not be reviewing or updating this material participating on today's call are Dr. Christian <unk>, Chief Executive Officer, and Jeff Cobble, Chief Financial Officer, I'd now like to turn the call over to Chris. Please go ahead Chris.
Speaker 3: Thank you, Paula. And thank you to everyone for joining the call this afternoon. We appreciate you taking the time to listen in.
Thank you Paula and thank you to everyone for joining into college. This afternoon. We appreciate you taking the time to do something.
Speaker 3: Throughout its 35-year history, thermogenesis has proven its ability to pioneer the development and production of a long list of cutting-edge automated technologies and products for the cell banking and cell therapy industry.
Throughout its 35 year history, so more Genesis has proven its ability to pioneer the development and production of a long list of cutting edge automated technologies and products for the cell banking and cell therapy industry.
With this year's approval of lesbians and gain sense, how big T. A car T therapy for relapsed and refractory multiple myeloma.
Speaker 3: With this year's approval of Legend and Jensen's CAR-VIC-T, a CAR-T therapy for relapse and refractory multiple myeloma, the number of FDA-approved autologous CAR-T drugs has grown to a total of six.
The number of F. D. A approved autologous car T drugs has grown to a total of six.
As the demand for Celgene therapies continue to explode zero now an estimated 350 plus U S companies alone are walking in the immune cell therapy arena.
And more than 1000 pipeline assets are in clinical development.
Targeting a variety of blood and solid tumors worldwide.
As a result, the significant need for cgmp manufacturing of these comp extremely complex personal life and life saving therapies, yes as important as ever.
Speaker 3: As a result, the significant need for cGMP manufacturing of these extremely complex, personalized, and lifesaving therapies is as important as ever.
Ah so more Genesis, we are moving closer to achieving one oh, achieving our goal to leveraging our unique and proprietary automated and semi automated cell processing technologies, including the car T Express platform to transition from a device the only comes.
Penny to one focused on providing providing.
Companies academic institutions, you can just space with cell based the contract development and manufacturing service or C. D M. All service.
Speaker 3: to help bring these therapies through the clinic and to the patients in need.
To help bring these these therapies.
Through the clinic and patient and treated patients you need.
As we announced during our year end call in March we signed a licensing and technology.
Speaker 3: As we announced during our year-end call in March, we signed a licensing and technology access agreement and leased for a cell manufacturing facility with the intent to form a new TG biosynthesis division.
S agreement and leased four eight cell manufacturing facility within which they intent to form a new T. G biosynthesis division.
Which will operate as a word class C. D M O four cell and cell based gene therapy manufacturing.
Speaker 3: which will operate as a world-class CDMO for cell and cell-based gene therapy manufacturing.
Speaker 3: As you may recall, we have partnered with Boya Life Genomics, a China-based CDMO organization.
S. You've made with coal we have partnered with Voya life genomics.
China based C. D M O organization for the exclusive license in the U S to use oil like genomics existing and future Knowhow and intellectual property.
Speaker 3: for the exclusive license in the U.S. to use BoilerLife Genomics existing and future know-how and intellectual properties relating to the cell manufacturing and related processes, including certain cell manufacturing technologies for varieties of clinical grade and non-clinical grade cellular products.
<unk> to the cell manufacturing and related processes, including certain cell manufacturing technologies full but royalties of a clinical grade and then clinical grade etcetera products.
At the same time, we enter into a lease agreement for more than 35000 square foot of space in Sacramento, California area CRO.
Speaker 3: At the same time, we entered into a disagreement for more than 35,000 square foot of space in Sacramento, California area, close to our
Two of our current headquarters.
Speaker 3: The space is being built out to create a state-of-the-art Current Good Manufacturing Practice, or CGMP-compliant
The space is being built out to create a state of art current good manufacturing practice or cgmp compliant.
Speaker 3: facility with 12 CGMP kingdoms.
Facility with 12, cgmp clean room suites.
Speaker 3: The TG biosynthesis division will look to address the growing need for CDMO services by providing high-quality development and manufacturing capacities. Cell and tissue products
The T G biosynthesis debriefing, well look to address the growing need for C. D. Most services by providing high quality development and manufacturing capacities.
Selling tissue processing development quality systems regulatory compliance and other cell manufacturing solutions for clients.
Speaker 3: regulatory compliance and other self-manufacturing solutions for clients with therapeutic candidates in various stages of development.
With therapeutic candidates.
Various stage of development.
Speaker 3: The industry fully expects to see a wave of additional FDA approvals going forward.
The industry for the industry, we fully expect to see a wave of additional FDA approvals going forward.
Speaker 3: with as many as 10 to 20 new therapies each year starting in 2025.
With as many as 10 to 20, new therapies each year starting in 2025.
Speaker 3: and this will likely accelerate over time.
And this will like the.
So accelerate overtime.
Currently each of the six approved car T cell therapies are extremely expensive.
Speaker 3: Currently, each of the six approved CAR T-cell therapies are extremely expensive.
Speaker 3: limiting patient access to these life-saving therapies.
Limiting patient access to Gs lifesaving therapies, given that they cost approximately 373000 to 475000 per dose.
Speaker 3: given that they cost approximately $373,000 to $475,000 per dose.
Speaker 3: making them among the most expensive drugs in the market.
Making it among the most expensive drugs in the market.
Speaker 3: The manufacturing cost alone for each dose of these CAR-T therapeutics exceeds $100,000.
The manufacturing cost of law for each dose of these car T therapeutics exceed 100000.
17, 9% of which can be attribute it to labor and GMP facility cost.
Speaker 3: 79% of which can be attributed to labor and GMP facilities.
Speaker 3: The demand for GMP manufacturing facilities and resources will continue to rise.
The demand for GMP manufacturing facility and resources will continue to rise.
Speaker 3: with a global success rate of 50 to 80%.
With our global success rate of 50% to 80% car.
Speaker 3: CAUTI therapy is an effective treatment.
Car T therapy is in fact ships there are effective treatment.
Speaker 3: that have the potential to improve millions of people's lives.
Has the potential to improve millions of People's lives.
Speaker 3: As I have outlined before, the surge in clinical activity has not been matched by an increase in production capacity.
As I have outlined before the surge in clinical activity has nothing has not been matched by an increase in production capacity.
Speaker 3: Even though over 65% of all cell and gene therapies are manufactured in outsourced facilities.
Humans are over 65% of all cell and gene therapies are manufactured in all sorts of facilities only a fraction of these required capacity exists in the marketplace today.
Speaker 3: Only a fraction of these required capacity exists in the marketplace today.
Creating a critical 10 210 to 18 months, so 12 to 18 months backlog in commercial manufacturing.
Speaker 3: creating a critical 10 to 18 months, sorry, 12 to 18 months backlog in commercial manufacturing.
Speaker 3: This will only be exacerbated by accelerated approval.
This will only be exacerbated by et cetera rate approvals.
Speaker 3: For developers of cell gene therapies, translating a drug from bench to bedside has been limited by these manufacturing bottlenecks.
For developers of Celgene therapies, translating a drug from bench to bed side has been limited by these manufacturing bottlenecks.
Speaker 3: which can be the largest challenge in achieving commercial success.
Which can be large it can be the largest the challenger.
On achieving commercial success.
Speaker 3: Even during the research stage, cell manipulations manual are technically complicated and are demonstrated only at laboratory scale for proof of concept in preclinical studies.
Even during the research stage cell manipulations, a manual are technically complicated and demonstrated only at a laboratory scale for proof of concept and preclinical study.
Developers will need to switch from manual process, if they intend to overcome their manufacturing challenges.
Speaker 3: Developers will need to switch from manual process if they intend to overcome their manufacturing challenges.
Speaker 3: As a reminder, the heterogeneous nature of the cell therapy products has introduced the manufacturing complexities and regulatory concerns, as well as scale-up complexities that are not present within traditional pharmaceutical manufacturing.
As a reminder, the genius.
Genius nature of the cell therapy products has introduced the manufacturing complexities and regulatory concerns as well as scale up.
Tax cities, South top notch present within traditional pharmaceutical manufacturing.
Speaker 3: Smaller biotech companies cannot afford the sizable cost that manufacturing scale-up requires.
More of a biotech companies cannot afford the sizable cost manufacturing scale up requires.
Even though for some large companies establishing a manufacturing facility for cell therapy requires specific expertise and significant capital. So I can't get late clinical trials.
Speaker 3: Even for some large companies, establishing a manufacturing facility for cell therapy requires specific expertise and significant capital that can delay clinical trials.
These facts often result in a significant number of cell therapy based companies seeking E. D M. Most for their cell manufacturing needs.
Speaker 3: These facts often result in significant number of cell therapy-based companies seeking CDMOs for their cell manufacturing needs.
With a strong intellectual property cutting edge technology and expertise and when beauty out state of art manufacturing capacity capabilities. Our T E biosynthesis division expects to capitalize on <unk>, Inc.
Speaker 3: with a strong intellectual property, cutting-edge technology and expertise, and when built out state-of-the-art manufacturing capabilities.
Speaker 3: Our TGE biosynthesis division expects to capitalize on these inefficiencies in the industry to become a world-class CDMO cell manufacturer service provider.
Efficiencies in the industry to become a world class C. D M O cell manufacturer service provider.
Speaker 3: Specifically, we will leverage our newly in-licensed technology from BoilerLife Genomics with our existing technology.
So that's the core we will leverage our new in new to in license the technology from boiler like genomics with our existing technologies, including our high efficiency semi automated car T Express platform.
Speaker 3: including our high-efficiency, semi-automated CAR T-Express path.
Speaker 3: capable of reducing processing time significantly and improving cell recovery and potentially cut 60 to 70% of the manufacturing cost.
Capable of reducing processing time significantly and improving cell recovery and potential rate cut 60% to 70% of the manufacturing cost.
To create a significant core ATM pricing advantage.
Speaker 3: to create a significant quality and pricing adventure.
Speaker 3: Providing CDMO service is a natural extension of the capabilities that we, and we look forward to marketing these services to clients in order to accelerate the development cycle of the cell gene therapy.
Providing C D M. A service is a natural extension of the capabilities that we and we look forward to marketing these services to clients in order to accelerate the development cycle of the celgene therapies, while reducing timeline.
Speaker 3: while reducing timeline and overhead.
Overhead cost.
As we have stated we anticipate to launch our see their most service to customer towards the end of 2022.
Speaker 3: As we have stated, we anticipate to launch our CDMO service to customer towards the end of 2022.
We look forward to reporting more on this exciting transformation in the coming months.
Speaker 3: We look forward to reporting more on this exciting transformation in the coming months.
Speaker 3: And with that, let me turn the call over to Jeff to share the key financial results for this first quarter. Jeff.
And with that let me turn the call over to Jeff to share the key financial results for this first quarter.
Yes.
Thank you Chris.
Net revenues increased to $2 7 million for the quarter ended March 31 2022.
Speaker 4: Net revenue has increased to $2.7 million for the quarter ended March 31, 2022, up 76% from the first
76% from the first quarter of last year. The increase was driven by actually disposable sales, which increased by approximately $1 5 million with over 600 more cases sold in the current quarter.
Speaker 4: The increase was driven by AXP disposable sales, which increased by approximately 1.5 million, with over 600 more cases sold in the current quarter.
Speaker 4: Gross profit was $940,000, or 35% of net revenues, for the quarter ended March 31, 2022, as compared to $700,000 for the same quarter last year.
Gross profit was 940000 or 35% of net revenues for the quarter ended March 31, 2022 as compared to 700000, the same quarter last year with the additional gross profit driven by the increased disposable sales.
Speaker 4: with the additional gross profit driven by the increased AXB disposable sales. Selling general and
Selling general and administrative expenses were $1 7 million for the quarter ended March 31, 2022, as compared to $2 million for the first quarter of last year.
Speaker 4: for the quarter ended March 31st, 2022, as compared to $2 million for the first quarter of last year. The decrease was primarily due to lower stock compensation.
The decrease was primarily due to lower stock compensation expense in the current quarter.
Speaker 4: Research and development expenses were $500,000 for the quarter ended March 31, 2022, as compared to $400,000.
Research and development expenses were 500000 for the quarter ended March 31 2022.
As compared to 400000.
First quarter of last year.
Speaker 4: The quarter ended March 31st, 2022. The company reported a basic and diluted net loss attributable to common stockholders of 1.9 million or 16 cents per share based on approximately 12.3 million shares.
For the quarter ended March 31st 2022, the company reported a basic and diluted net loss attributable to common stockholders of $1 9 million or <unk> 16 cents per share based on approximately $12 3 million shares outstanding.
Compares to a basic and diluted net loss attributable to common stockholders of $2 4 million or 21 per share based on approximately 11 4 million shares outstanding for the quarter ended March 31 2021.
Speaker 4: compares to a basic and diluted net loss attributable to common stockholders of $2.4 million or $0.21 per share, based on approximately 11.4 million shares outstanding for the quarter ended March 13, 2018.
Speaker 4: As of March 31st, 2022, the company had cash and cash equivalents totaling $3.7 million.
As of March 31st 2022, the company had cash and cash equivalents totaling $3 7 million.
Speaker 4: be paired with 7.3 million at December 31st, 2021.
Compared with $7 3 million at December 31, 2021.
This concludes our prepared remarks.
Speaker 1: This concludes our prepared remarks, and now we'd like to open the call to your questions. Operator? We will now begin the
Now, we'd like to open the call to your questions operator.
We will now begin the question and answer session.
To ask a question you May press Star then one on your telephone keypad.
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Showing no questions. This concludes our question and answer session.
Speaker 1: Showing no questions, this concludes our question and answer session. I would like to turn the conference back over to management for any closing remarks.
I'd like to turn the conference back over to management for any closing remarks.
Thank you operator, we look forward to updating you on our progress during our second quarter 2022 call.
Speaker 3: Thank you, operator. We look forward to updating you on our progress during our second quarter 2022 call. And thank you to everyone who participated today and for your interest in thermogenesis holding.
Thank you to everyone, who participated today and for your interest in Soma Genesis Holdings.
Speaker 1: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
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