Seer Inc. Q1 2023 Earnings Call
Okay.
Good day and thank you for standing by welcome to the sphere first quarter 2023 earnings Conference call.
At this time all participants are in listen only mode. After the speaker's presentation, there will be a Q&A session to ask a question. During the session you will need to press star one one on your telephone and you will hear an automated message.
And your hand this race to withdraw your question. Please press star one one again please be advised today's conference is being recorded I would like to handle the conference over to your speaker today, Carrie Mendivil Investor Relations. Please go ahead.
Thank you earlier today <unk> released financial results for the quarter ended March 31, 2023, if you have not received this news release or if.
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Joining me today from theory is Amit Birk, Dod Chief Executive Officer, President and chair and David Horn, Chief Financial Officer.
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.
These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated.
Additional information regarding these risks and uncertainties appears in the section entitled forward looking statements in the press release issued today for a more.
More complete listen description. Please see the risk factors section of the company's quarterly report on Form 10-Q for the quarter ended March 31, 2023, and then this other filings with the Securities and Exchange Commission.
Except as required by law <unk> 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.
This conference call contains time sensitive information and is accurate only as of the live broadcast may nine 2023 with that I'd like to turn the call over to Amit.
Thanks, Carrie and thank you everyone for joining us this afternoon.
I will begin our call today with a review of our first quarter results as well as the progress, we're making across our core focus areas to drive growth.
Then I will turn the call over to David to provide more detail on our financial results.
Thanks to the tremendous effort of the entire team at tier.
We had a solid start to the year and ended the first quarter with $4 1 million in revenue and continued growth in our installed base.
Even more importantly, we're increasingly seeing more and more data being shared by our customers. The initiation of larger studies with a growing interest in population scale studies.
And the first customer of publication, making their way through the peer review process.
We have consistently said that the increased publication of customers and third party data will be critical to developing the market and this is exactly what we're seeing we now have more than 150 public presentation on theater technology to date with additional data expected at the American Society of mass spectrometer.
Three or <unk> annual conference in early June .
With the solid start we are reiterating our 2023 guidance and continue to expect revenue in the range of $23 million to $25 million for 2023, representing.
Representing significant year over year growth of 48% to 61%.
We continue to drive topline growth.
We're taking a very disciplined approach with our operating expenses.
In order to protect our robust balance sheet.
With over $410 million in cash we are well positioned to execute on our multi year strategic plan and are building a resilient organization that can make a meaningful impact on the advancement of science and medicine.
We're committed to leveraging our resources to drive innovation.
Creating value for our customers and investors and contributing to the positive trajectory of the proteomics field and human health overall.
As mentioned on the last earnings call.
This year, we're focused on executing across our four core areas first.
Enabling breakthrough discoveries with the project graft product suite second demonstrating the power of our technology third catalyzing, new applications and markets and finally.
Fourth expanding our industry leading team.
Starting with our first objective.
The pruning of our product suite is highly extensible and is providing reproducible unbiased access to the peripheral with flexibility and scale, allowing it to address many unmet needs in our customers' hands.
We're encouraged by the growing enthusiasm for what the project graph workflow can enable.
As I mentioned in my opening remarks, more customer data is being shared publicly Dr.
Dr. Karsten theory, a leading multi omics researchers professor of physiology in biophysics at Weill Cornell Medicine has a manuscript under peer review that is now available as a preprint and bio archive.
This is the first study using the Purdue graph product suite to perform protein quantitative trade no tie or PQ TL analysis.
I view this study as an important milestone and reached a biological value of connecting genomic variance data to deep unbiased proteomic data at the peptide level has been robustly exemplified.
In a cohort study of 325 diabetic subjects and controls doctors theory identified approximately 3000 proteins in over 18000 peptide and associated with genetic variance across the study, allowing them to identify variation in plasma protein concentrate.
And among subjects imports.
Importantly, this publication highlights the shortcoming.
<unk> based approach it in which to measure the abundance of the target protein may be impacted by protein altering variant that changed their binding epitope.
The affinity reagent.
Doctor series work highlights the importance of peptide level resolution towards deeply understand the protium, which the protium <unk> products, we are uniquely able to deliver at scale.
Another interesting emerging application of the peripheral graft is targeted mass spectrometry workflows for quantifying specific high value human plasma and serum proteins for example in obesity and diabetes research.
Most assay two days in obesity and diabetes research rely exclusively on antibodies. We have certain publications have shown this approach has limitations, including failure to detect the intended target for the post revolutionary modified biologically active forums.
Combination of mass spec based targeted for genomics combined with the Paducah workflow provides a solution to this problem with a robust highly reproducible method for detecting and quantifying the desired protein variance across a wide range of concentrations at the peptide level, Dr. Jennifer <unk>, who is a professor of cardiology.
And director of the advanced clinical Biophysical Research Institute.
And founder of the precision biomarker lab at Cedars Sinai is leading this work Dr.
Dr. <unk> is an international leader in clinical proteomics, and current president of the human proteome organization or coupon.
Her team has leveraged the prototype product suite to identify and quantify clinically relevant biomarkers that are inaccessible to immunoassay.
The targeted methods they performed using the <unk> graph.
<unk> accurate quantitation of lower abundance proteins that are not easily accessible by standard proteomics workflow.
I'll also allowing the monitoring of several hundred other plasma proteins of interest which may contain additional biomarker leads.
Importantly, this method allows for rapid completion of large scale studies and the potential for quick diagnostic turnaround in an assay that can be offered as a service to stratify obese diabetic patients into optimal treatment groups.
Protein presented the project evaluation data at the targeted mass spectrometry assays in diabetes and obesity research meeting that is funded by the National Institute of diabetes, and digestive and kidney diseases late last year and are currently in the process of scaling up the study towards the publication later this year.
That give an act research is a great illustration of the unmet needs that the prodrug that workflow can address in the hands of customers and speaks directly to its potential to deliver new clinical applications that have not been possible with existing methods.
In January one of our multi omics liquid biopsy customers product Millwork announced early results for what they believe to be the largest deep multi omics study to date.
This study was run across 1031 subjects with non small cell lung cancer.
CLC and non cancer control and demonstrated the power of divers molecular biomarker to improved sensitivity and specificity.
Early detection.
CLC.
Last month, we presented new data in two posters at the American Association for Cancer Research annual meeting that demonstrated novel biomarker discovery and the potential feasibility of their approach for early cancer detection.
The first poster leverage deep multi yielded profiling of proteins metabolized transcripts and cell free DNA in blood from CRC patients for biomarker discovery.
Data showed multiple biomarkers for <unk> plc.
Detected across all op type.
With many overlapping biomarkers of interest and demonstrated.
Broad ability to distinguish between individuals with and without cancer.
The project, we have played a significant role in biomarker identification demonstrating the importance of peptide level resolution to drive novel discovery.
The second poster demonstrated that a multi orbit classify achieved high sensitivity and specificity for detection of pancreatic ductal adenocarcinoma.
The AC also referred to as <unk>.
In the case control study of 146 subjects.
This proof of concept study probably will make levers multi omics data to identify novel combination of analyzed with both known and unknown relation to PDI into high performance biomarker panel for detection and discrimination of feedback from non cancer control.
The high performance of analyze collected from blood draws mixed it panels available through rapid development and utilization.
Results support the feasibility of this approach as a potentially clinically useful test for early detection of feedback.
These results from product gnomic illustrate how the pool geographic can drive the identification of novel Biomarkers, which can then be utilized in clinical application. This is just the beginning of what we believe the project graph will enable in the customers.
In late March at the U S. Human Proteome organization conference. There was one podium presentation and nine posters, highlighting sphere technology, including customer data and COVID-19 vaccine response, and an optimized method for the project with the Thermo Fisher arbitrage.
Morris for.
Using the <unk> probe.
The oral presentation covered the first look at the Alzheimer's disease cohort of approximately 1800 plasma samples using our next product which is in the hands of several early access customers.
We also hosted a well attended industry workshop with three featured presentations highlighting pro geographic performance flat.
Flexibility to address multiple sample types and the ability to drive large scale study.
In June at the upcoming American Society for mass spectrometry or Asml's annual conference. We are looking forward to more exciting data with 15 sphere and 12 customer abstract in the program.
Customer posters and presentations include using an aging in mouse model.
Translational Pharmacopeia genomics.
Alcoholics that you have the guidance or Nash.
Sensitivity with precision quantitation in targeted applications.
And host cell proteins for biologic manufacturing among others.
And we're continuing to drive standardization and partnership with our commercial partners Thermo Fisher Bruce.
Broker as <unk> with multiple posters in cost demonstrating the exceptional performance at a photograph across these leading mass spec platforms.
One customer study of note at <unk> is from Dr. Steve cars lab at the broad Institute.
Dr. Kerr will have an oral presentation demonstrating the performance of the project graph in plasma from multiple myeloma patients using the broker Teamstaff HD.
And TIAA Paypal.
These results are particularly exciting as they show how larger scale studies that are enabled by the paragraph.
We'd optimize mass spec protocols can get us deeper into the proteome than previously possible in 2017, Dr. Kerr published a seminal paper that achieved a depth of 4500 proteins in plasma and this paper has remained the benchmark for deep unbiased proteomics and plasma until.
Now importantly, the 2017 study given the complexity of the workflow was accomplished and only 16 samples Dr.
Dr cars current study identified over 5900 protein and is being applied to 300 samples.
This is yet another example of the step function increase in the depth and throughput our proteomics that has been enabled by the <unk> product suite.
It is exciting to see an acceleration of customer driven data beginning to make its way into publications a significant one such notable example of a customer manuscript under peer review include the use of a prettier graph to follow the civilian cooler space X inspiration for combined with additional.
<unk> multi your big data to further understand the body's response to space flight.
This project is providing new opportunities to understand the molecular and cellular changes that occur in humans during space travel, we look forward to sharing more detail following the publication of the study.
We have visibility to multiple additional manuscripts are being submitted by customers in the coming months as more third party data is generated we will see more proof of the unique value of project route to drive novel biological insight that will accelerate the next generation of multi Omics studies, we feel very confident about our market opera.
Unity is thrilled by the emerging validation and a further drop in our customers and expect a progressive increase in the velocity of adoption in the coming several quarters.
Turning our attention to the second objective demonstrating the power of that particular product suite.
We continue to innovate and extend the capabilities of our technology and drive our own abstract and publication in March we announced that our paper on bone morphogenetic protein one or BNP, one was published in plus one.
This peer reviewed publication highlighted the importance of the photograph in identifying peptide level insights that discovered links between protein variance and lung cancer progression at the protein isoform level.
In upcoming months, we expect to have multiple papers released from here. In addition to what we're expecting from our customers. These papers will continue to advance the field of nano BIA interactions proteomics workflows and large scale data size showcasing the disruptiveness of our technology and its unique ability.
Pushed the boundaries in proteomics.
We remain committed to delivering cutting edge solutions that drive more access to proteomics data.
We know that enabling streamlined data processing analysis and interpretation is key.
Throughout 2023, we will continue to expand our software capabilities and laser roadmap for large scale studies with our project graph analysis suite.
We believe that this will be an important component of our workflow and will serve to enable more customers to onboard deep unbiased for genomic at scale.
From the very beginning we believe there will be broad interest to incorporate unbiased deep plasma proteomics into studies at scale well beyond the existing installed base of mass spec users engaging proteomics research.
That is exactly what we're seeing play out.
Our discussion.
Consistent with our original vision the market opportunity is large spanning the mass spec installed base as well as the genomic market with increased appetite for adding multi youll make data to genomic dataset.
Our next product is meant to capitalize unmet need to serve a broader audience. It is already in early access with multiple sites and we're getting great feedback on its performance.
First product delivered a step function change in unbiased per deal mix and this next product does the same.
We are really excited about what it will enable in the market and we look forward to sharing more with you in the upcoming months.
Turning to our third objective catalyzing, new applications and markets.
Our technology is inherently accessible it is piece is agnostic and is compatible with a diverse range of sample types.
<unk> got a product suite is being used in a range of applications across our growing customer base and academic research translational commercial pharma CRO and even applied markets.
One example of a new application that has emerged from our customer base is the use of the project graph to detect host cell proteins or HCP.
Hcp's are proteins produced or encoded by the host Oregon is then used to produce recombinant therapeutic proteins, such as those new environment any factoring of vaccines.
Removal of HCP is one of the biggest challenges for the production of biopharmaceutical.
An ideal hcp's screening assay, it's high throughput reproducible quantitative and sensitive with high dynamic range. The Proteus graph fits this bill.
And a study in partnership with a major pharmaceutical company, we demonstrated that the Portio graft product suite detect two to six times more <unk> than traditional method identifying 98% of the HCP and overall improving measurement across purification steps.
Hosted on this work will be presented at the upcoming ASN Biopharma partner.
Customers continue to find value and prove proof of principal studies as they build the case for capital equipment funding within the organization, including the Grand submission process for academic customers.
These are all studies of 40 to 100 samples are a key enabler for customers to onboard our technology and often results in posters abstracts on their own as preliminary insight and punitive biomarkers can be uncovered even from small studies of this size.
We had the shipment of a project graph to a non human health company in the first quarter. For example, following a small proof of principle study conducted for this organization.
We've got proof of principle study program, we have demonstrated user project graph and chicken dog cat Tabooed and plant tissue across studies looking at coal exposure diet.
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Cognitive impairment multiple characters and transplant.
We will continue to drive market development efforts, such as these studies aflac collaborations and Kols work to accelerate and enable broad market adoption.
Through these efforts we are building relationships with key opinion leaders and expanding our scientific Advisory Board with the recent addition of Dr. Josh Coon.
Dr. Chris Mason and Dr generally like.
Dr. Coon is a professor of chemistry, and bio molecular chemistry at University of Wisconsin Madison.
Dr. Mason is a professor of genomics physiology biophysics at Weill, Cornell Medicine, and a director of the world client initiatives for positive prediction.
As well as an affiliate of Memorial Sloan Kettering Cancer Center, Rockefeller University, Harvard Medical School and Law School.
As mentioned earlier, Dr. <unk> <unk> professor of cardiology at Cedars Sinai as well as the director of the advanced clinical Biosystem Research Institute founder of the precision bio marker labs and the current president of the Hugo.
These relationships are real.
Putting the power of the Purdue graph in the hands of these luminaries in the field.
Partnering with us to imagine a new future in multi omics and I'm excited to continue our engagement to push the boundaries of what's possible together.
Before I turn the call over to David.
Wanted to share an update on our leadership team.
Scott Thomas our Chief commercial officer will be transitioning from here in July I want to thank Scott for his contribution leading and developing our commercial organization. Our two senior regional Vice President will lead commercial in the Americas.
APAC respectively.
We have an excellent team in place.
And we're confident we will continue to deliver on the promise of our transformational technology.
I will now turn the call over to David.
Thanks, Amit total revenue for the first quarter of 2023 was $4 1 million.
An increase of 22% compared to the $3 3 million in the first quarter of 2022. The increase in first quarter revenue was primarily due to increased consumable kit sales related to the pretty aggressive product suite.
We recognized primarily consisted of sales of photograph SB 100 instruments and consumable gains additional sources of revenue include platform evaluation service grant and lease revenue.
Related revenue for the first quarter of 2023 was $3 $6 million, including.
Including related party revenue of $1 3 million and consisted of sales of SB 100 instruments.
Tunable kits and platform evaluations.
Service revenue was $69000 in the first quarter of 2023 and was primarily derived from the completion of our customer service project. As we have mentioned previously we will continue to be strategic and undertaking certain service projects for customers that we ultimately believe will lead to purchases of the paragraph.
Grant and other revenue was $335000 in the first quarter of 2020.
As discussed last quarter contributions from grants and research related collaborations will resume beginning in the fourth quarter of 2022 related to our SBR Grant from the NIH Grant period will run through May of this year. In addition, we placed instruments with key accounts, but also require these customers to purchase consumables, we recognize a portion of this revenue.
As lease revenue.
Total gross profit was $2 1 million for the first quarter of 2023, representing a gross margin of 51% gross margins were aided by the mix of consumable versus instrument revenue and additional grant revenue in the first quarter. This was offset by overhead expenses and other cost of revenue.
We expect to see variability in our overall gross margin on a quarter by quarter basis, as a proportion of instrument and consumable sales will fluctuate between any given quarter.
Total operating expenses for the first quarter of 2023 were $29 5 million, including $8 7 million of stock based compensation, an increase of 18% compared to $25 million, including $8 1 million of stock based compensation.
First quarter of 2022.
Research and development expenses for the first quarter of 2023 were $14 5 million, an increase of 35% compared to $10 7 million in the first quarter of 2022.
The increase in R&D expenses was primarily due to an increase in product development efforts related to the protocol graft product suite, including employee compensation costs and other related expenses due to growth in R&D personnel and expenses associated with the build out of our facility.
Selling general and administrative expenses for the first quarter of 2023 were $15 million, an increase of 5% compared to $14 3 million.
First quarter of 2020 to the.
The increase in SG&A expenses was primarily driven by greater employee compensation expenses due primarily to growth in personnel for our global commercial organization.
Net loss for the first quarter of 2023 was $24 million compared to $23 6 million in the first quarter of 2022.
We ended the quarter with $410 5 million in cash cash equivalents and investments as Hamid mentioned, while we continue to drive growth on the topline.
Taking a very disciplined approach to spend in order to protect our robust balance sheet. We will continue to be very mindful of our level of spend as the year progresses in light of the volatile macroeconomic environment and its potential impact on demand.
Disciplined deployment of capital. We believe we are well funded to execute on our strategic plan for many years to come.
Turning to our outlook for the year, we continue to expect revenue to be in the range of 23% to $25 million for 2023, representing significant year over year growth of 48% to 61% similar to 2022, we expect revenue to be more weighted to the second half of the year.
At this point I would like to turn the call back to me for closing comments.
Thanks, David.
Started the year off with a good momentum as more and more customers generated data using the <unk> graph further solidifying the need for large scale unbiased deeper genomic studies.
It is exciting to see the prototype enabling breakthrough science is showing through its power extensibility and ability to catalyze new applications and markets I have never been more excited about the opportunities ahead with that we will now open it up to questions. Thank.
Thank you at this time, we will conduct a question and answer session. As a reminder to ask a question you need to press star one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one again, please standby, while we compile the Q&A roster.
Our first question comes from TJ Savant from Morgan Stanley . Please go ahead.
Hi, This is Scott on for <unk>. Thanks for taking my question.
So maybe just to start with what Youre seeing right now with your customer base. What impact are you seeing currently from the longer sales cycles and academic versus Biopharma customers and are you seeing any constraints spending from Chinese CDMA customers. Thanks.
Yes, Thanks, Gaby it's David.
In terms of the customer base.
We are continuing to see.
Somewhat elongated sales cycle again, I think I think the environment continues to be cautious but at the same time, we are seeing capital being deployed.
I think as we've said historically that.
For a new disruptive technology. It is just a little bit of a longer sales cycle for us in terms of.
The data coming out in the key points.
Customers choose to run a proof of principle study with us and so that's really what's creating some of the elongated sales cycle, but I will note that we have had some publications that have Amit mentioned during his remarks, one for Dr. <unk> and another one coming out. So we're excited about those presentations. We're also excited about what's coming.
<unk> conference in June to kind of continue to have those customer proof points, but again, we are continuing to see.
It just takes some time for people to get comfortable with the technology.
Ultimately decided to bring it in house in terms of China, We do feel like the market has been.
Is opened up.
We still.
In terms of working with our distribution partner over there are still seeing again, some kind of ramping back up and getting back up to speed, but certainly the access over there has certainly improved.
Okay.
Great. Thanks, and then.
Just on your plans to further intelligent commercial org.
Could you share any progress on that and how many reps you're planning to add before year end.
This is amit.
So we've said that we're not going to be disclosing.
The specifics.
Of the size of our commercial organization.
That said that.
In terms of the number of sales that that said the total organization right now.
Sales support marketing.
Is around 50 people.
We think thats the right side, we're going to continue to scale.
Commensurate.
<unk> revenue coming in.
Trying to stay about one to two quarter ahead of it.
And I think we're.
We're well on that pace right now.
Okay great.
And then you had mentioned at a conference recently that you believe other I'll make integration will be in serious future. So what is your next focus for enhancing the perennial graphs, we are moving towards achieving that and I guess just what is the latest feedback you've received from your customers and how are you thinking about improvements to the platform based on the customer.
Back thanks.
Sure.
We released.
The protium graph analysis suite 2.0.
Past two point, though.
That was last August .
That software allows a user customer.
To integrate genomic information.
And Proteomic information as part of the analysis.
It was the first step.
To help the customer achieve prudent genomic.
Look at particular subject that Theyre looking at.
We're going to continue to.
Innovate in that space.
That looked at genomic information, but we can bring in an attractive genomic information as well on top of that.
And as those innovations in terms of analysis export cargo.
And when you do that with.
We tend to look at changes that happen.
In terms of protein up and down regulation.
And responsive genetic variants of the population.
Protein various level fundamentally disruptive I think thats the way, we kind of study should be.
So we'll be getting to see customers publish.
Papers that validate.
That we need to look at the podium at the level of the proteins areas.
Because the complexity of the protium exist.
Cause it's biologically relevant.
I fear uniquely enables that to be done accurately precisely and at scale.
No.
We released product one and it was a step increase.
Increase in terms of.
Being able to go deep.
Scale and throughput.
The feedback that we got from customers was look.
Can we go deeper can we go faster and communities smaller amount of sample volume because our biological samples are precious to us.
And so we have product number two that's now in the hands of our early access customers. The feedback has been fantastic.
More to come on that suffice it to say that that product in my mind is yet another.
Stuff like the increase in terms of what is possible with our product to.
Certainly aggressive.
Some of the feedback that we've gotten from customers on product, one and I am Super Super excited to be able to reveal more I'd tell you more about it.
In over the upcoming.
As we put that product our broadloom commercial and they have the.
Customers.
Okay.
Great. Thank you for the color.
Thank you. Our next question comes from Dan Brennan from TD Cohen.
Hey, good afternoon. This is Kyle on for Dan. Thanks for taking the questions. So how meaningful third party publications, beating your customer conversations.
A notable pickup in customer interest slash instrument purchases post these publications implied in the 'twenty three guide.
And then maybe just going off of that you know after the first quarter, what's your what's your confidence and visibility into the back half ramp here.
Hey, Tyler, let me I'll take a part of that and I'll have David answer part of it as well.
So we have visibility.
Two at least a handful of customer papers that are on various stages of publications, including one that you saw is now publicly available on bio archive, but others.
That are in late stage review.
That should be coming and then others that are being submitted.
I had predicted late last year that we would see probably about five customer papers.
Kind of tilted towards the second half of the year it may actually be more than that.
And then interestingly and importantly, and related to this is also the number of presentations from customers. So you know.
We're now seeing customer presentations at conferences, where we weren't even aware of those studies being done are those studies being presented that's exactly what you want to see.
And that you put up the abstract book and you see one of your customer has something going on there.
They are sharing and they're talking about it and I think we're also seeing that so.
We're optimistic that the.
Velocity of customer data presentation is going to be increasing at a progressive restart with slope.
As you head into the second half of 243.
And.
And then you know kind of the.
The balance of the year heading into 'twenty, both Kyle so with that let me turn it to David as he can give you additional color in terms of revenue and before I do I would say that.
I reiterated the guidance Tom.
So I'm confident about.
For the year.
'twenty two.
<unk> to 'twenty 5 billion guidance that we've got and then you have this is David.
Yes.
In terms of the 2023.
As I mentioned, we did reiterate guidance instead.
And so we feel comfortable with that.
Doesn't mean it also mentioned we did have some visibility into some of these papers coming.
When we did provide our initial guidance.
So we certainly had some of those papers baked in to the extent there other papers that.
Come out or presentations again, we feel like that.
That tends to be a.
But I think that'd be a benefit in terms of just helping.
Kind of shorten that sales cycle, a little bit for us in terms of getting getting other folks interested in and evaluating technology. So I think we feel pretty good where we are and we did have the fact that some of these papers.
<unk> would be out as part of our original guidance.
Got it. Thank you and then so how has customer interest in the in the lease program is that something you're actively offering to all potential to your customers or is it just a select number of potentially more meaningful customers.
Yeah, Great question, So what we've decided to do is.
We rolled out what we call our strategic.
Instrument placement program.
And really what we're looking to do is identify.
Key parties, whether they be kols or large customers with large sample sets people who can again.
Drive.
This is the technology.
And really just trying to lower.
Areas to accessing the technology and the short term and so we did.
We did.
Place some of the instruments, we place in the first quarter were part of that and so essentially what that program is.
It does require consumable purchase so there is a consumable purchase that goes along with that.
And then they have essentially.
We agreed to place the instrument for a period of time the customer has the option to purchase it at the end of that.
And again it just helps facilitate.
The getting up and using the technology.
And ultimately.
Helped drive a consumable revenue stream for us I will say the the amount of lease revenue to be recognized as part of that is is pretty de minimis.
And it's really about.
Viewing to drive.
Consumables and consumable revenue.
Around that but again I think the overall objective is to find ways to.
Got it.
Improve access and helped drive.
Again presentation papers publications with accounts that are going to be leaders either thought leaders.
And in others.
Large accounts that have large sample sets to help drive consumable volume over the long term. So it's been a really been a great. It's been well received by customers.
And so we.
We'll see how it plays out over the balance of the year, but.
We certainly feel like it's a good a good program that.
It is helping us but from a obviously theres consumable revenues.
That is meaningful but from overall lease revenue.
Not really significant.
Got it thank you.
Thank you again as a reminder to ask a question you need to press star one on your telephone.
Thank you for your participation in today's conference. This does conclude the program you may now disconnect.
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