Q3 2024 Absci Corp Earnings Call
Good day, and thank you for standing by.
Welcome to the I'm, sorry, Q3, 2024 business update conference call.
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Speaker Change: I would now like to hand, the conference over to your Speaker today, Alex Com VP Finance and Investor Relations. Please go ahead.
Speaker Change: Yeah.
Speaker Change: Thank you Earl.
Speaker Change: Earlier today, <unk> released financial and operating results for the quarter ended September 32024.
Speaker Change: If you haven't received this news release or if you'd like to be added to the Companys distribution list. Please send an email to you investors at <unk> dot com and archived webcast.
Speaker Change: Webcast of this call will be available for replay on outsized Investor Relations website at investors thought outside dot com for at least 90 days after this call.
Speaker Change: Joining me today are Shawn Mcclain, as founder and CEO, Zach Johnson, Chief Financial Officer, and Chief Business Officer, Christian Steckman outsized SVP of drug creation will also joined for Q&A following prepared remarks.
Speaker Change: Before we begin I'd like to remind you that management will make statements. During this call that are forward looking within the meaning of the federal Securities laws. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated and you should not place undue reliance on forward looking statements additional information regarding these risks uncertainties and factors that could cause results to.
Speaker Change: Differ appear in the section entitled forward looking statements in the press release issued today and the Doc Jensen reports filed by upside from time to time with the Securities and Exchange Commission.
Speaker Change: Except as required by law, <unk> disclaims any intention or obligation to update or revise any financial or product pipeline projections or other forward looking statements either because of new information future events or otherwise.
Speaker Change: This conference call contains time sensitive information and is accurate only as of the live broadcast November 12 2024.
Sean: With that I will turn the call over to Sean.
Sean: Thanks, Alex Good morning, everyone and thank you for joining us for our third quarter business update call.
Sean: Today, we are excited to discuss some of the latest progress we have made throughout our portfolio of programs, both partnered and wholly owned and share some additional information.
Sean: <unk> ahead of our 2020 for R&D day next month.
Sean: Towards the end of last year, we entered into a collaboration with Astrazeneca to deliver.
Sean: Designed to antibody against oncology target.
Sean: This collaboration combines outside integrated drug creation platform with Astrazeneca expertise in oncology with the goal of accelerating the discovery of a potential new cancer treatment candidates.
Speaker Change: We are proud to recently announce approximately six months after starting this program achievement of the first milestone under our collaboration having delivered AI de Novo antibody sequences designed using our integrated drug creation platform.
Speaker Change: In addition to the progress we have made on our collaboration with Astrazeneca and with other partners. We are pleased to be adding another new partner to our diverse western collaborators <unk> bioscience as.
Speaker Change: As we recently announced <unk> is collaborating with twist to design a novel antibody using generative AI.
Speaker Change: We are very excited to be working with twist on this innovative program in fact will share additional details on this new partnership later in the call.
Speaker Change: One month from today on December 12, we are excited to be hosting our 2020 for R&D day in New York City at this event.
Speaker Change: Hear from our executive leadership, and our scientific team as well as a series of distinguish guest speakers, we plan to share additional information about our existing internal asset programs and then bill one new asset program.
For those not attending in person a live broadcast of the full presentation and a replay will be available on our website.
Speaker Change: But before then I'd like to take a moment now to provide an overview of the current state of each of our proprietary programs.
Speaker Change: Starting with AVX 101.
Speaker Change: Our potential best in class Tijuana antibody a few months ago, we shared results from our nonhuman Primate studies of this program demonstrating two to three X extended half life as compared to the first generation of antibodies in clinical development and further supporting this program as a potential best in class profile.
Speaker Change: And our studies AVX 101 is also observed to have an increased bio distribution and then HP as compared to the first generation Tijuana antibody in clinical development and CMT studies verify is the ability to formulate AVX 101 at high concentrations of 200 milligrams per milliliter, which supports <unk>.
Speaker Change: Development of the subcutaneous formulation.
Speaker Change: And last month at festival biologic year of 2024.
Speaker Change: <unk> has presented titled development of AI design therapeutic anti <unk> antibody for IBD.
Speaker Change: Additional data for the ABS <unk> hundred one program.
Speaker Change: Shared at this event and can be found on <unk> website within our updated corporate deck and a copy of the poster shared at the conference.
Speaker Change: We continue to advance ABS 101 through R&D, enabling studies as planned.
Speaker Change: And are confident in our programs ability to potentially demonstrate a truly differentiated product profile. We plan to initiate phase one clinical studies of AVX 101 in the first half of 2025 and continue to expect an interim data readout in the second half of 2025.
Speaker Change: Turning to Avs tier one our potential best in class Dermatology program, maybe as tier one is design from an undisclosed dermatological indication with high.
Speaker Change: Unmet need where the efficacy of the pharmacological standard of care is not satisfactory, we believe that the target for this program is underappreciated as we could potentially be stack into clinic.
Speaker Change: And as we continue to anticipate collecting a development candidate for this program. This year, we look forward to sharing some additional data and information for this program, including the target and its potential markets and indications with you all at our R&D day next month.
Finally.
Maybe 301, our potential first in class immuno oncology program <unk> 301 is a fully human antibody designed to bind against a novel target discovery through outsized reversing neology platform. We anticipate completion of motive action validation studies for edit 301 in the first half of 2025 with plans to share.
Data for this program shortly after.
Speaker Change: As you can probably tell we are all very excited about the updates that we'll be sharing next month at our R&D day.
Speaker Change: Till then as always we remain focused on continued innovation and execution on all aspects of our platform and portfolio all with the mission to create better biologics for patients faster.
Speaker Change: And as always the progress we are able to achieve is a testament to the work our team does each and every day at oxide and reflects our platform's differentiated capabilities and AI job creation for biologics.
Speaker Change: With that I'll now turn the call over to Don to walk through our new partnerships, our outlook and provide an update on our financials.
Speaker Change: <unk>.
Don: Thanks, John as John mentioned, we recently entered into an exciting new partnership with twist Bioscience. This collaboration brings together <unk> generative AI drug creation platform with twist DNA synthesis platform to accelerate the design and preclinical development of a novel therapeutic antibody for a biological tar.
Don: Implicated in multiple disease areas.
Don: For this collaboration with Silicon based synthesis platform will help power early stage R&D, including testing and validation of antibody candidates designed using outsized generative AI technology platform.
Don: Following the planned early development of this program.
Don: <unk> intends to seek a partner for further human clinical development and commercialization.
Speaker Change: We are proud to add another great partner to our list of collaborators, which includes Astrazeneca Merck L. Morale Nvidia Memorial Sloan Kettering Cancer Center, and others and we look forward to working together with twist on this important program.
Speaker Change: Looking to the remainder of this year and into 2025.
Speaker Change: Continue to see a robust and diverse pipeline of potential partners for new drug creation programs. Hence we continue to anticipate signing partnerships with two more partners. In addition to our previously announced partnerships with Emiscan twist this year.
Speaker Change: As Sean discussed our portfolio of proprietary programs includes three diapers wholly owned assets.
Speaker Change: 101, ABS <unk> and ABS 301.
Speaker Change: All of which were generated using our integrated drug creation platform.
Speaker Change: We continue to advance each of these internal programs according to plan.
We also continue to make progress on new internal programs and expect to advance at least one additional internal therapeutic program to the lead stage this year.
As a reminder, our business model is focused on out licensing or selling our internal programs and co developed programs following value inflection proof points.
Speaker Change: We're from preclinical proof of concept.
Speaker Change: Phase II clinical proof of concept.
Speaker Change: Turning now to our financials revenue in the third quarter of 2024 was $1 $7 million as we continue to progress our partnered programs.
Speaker Change: Research and development expenses were $18 million for the three months ended September 32024, compared to $11 million for the prior year period.
Speaker Change: This increase was primarily driven by increased lab operations, including approximately $3 million in direct costs associated with IND, enabling studies for ABS 101.
Speaker Change: And an increase in stock compensation expense.
Speaker Change: Selling general and administrative expenses were $9 3 million for the three months ended September 32024.
Speaker Change: Compared to $9 5 million for the prior year period.
Speaker Change: This decrease was due to lower personnel costs.
Speaker Change: <unk> reductions in administrative costs.
Speaker Change: Set by an increase in stock compensation expense.
Speaker Change: Turning to our balance sheet, we ended the quarter with $127 1 million in cash cash equivalents and short term investments compared to $145 2 million as of June 32024.
We continue to enhance our focus on high value proprietary internal programs, while also seeking high quality co development and drug creation partnerships with industry leaders, who bring synergistic expertise and technology.
We believe this strategic and balanced approach will provide us with the best ROI, rather than simply pursuing a higher volume of programs and best positions us for further success in the future.
Speaker Change: For 2024, we now expect the gross use of cash cash equivalents and short term investments of approximately $75 million.
Speaker Change: As approximately $5 million below our previous expectation of $80 million.
Speaker Change: This estimate includes the expected costs associated with advancing the IND, enabling studies for AVX 101, with a third party CRO.
Speaker Change: Based on our current plan, we believe our existing cash cash equivalents and short term investments will be sufficient to fund our operations into the first half of 2027.
Speaker Change: Altogether, we are very pleased with the progress we have made on our internal programs and we are confident in our ability to execute on these and on our partnered programs over the rest of this year and beyond with that I'll turn it back to Sean.
Speaker Change: Thanks Zack.
Sean: Over the course of this year, we have demonstrated solid execution across all aspects of our business and throughout our portfolio of proprietary and partnered programs.
Sean: As we continue to execute on our strategic objectives and ultimate mission, we see a number of potential catalysts in the next six to 12 months and beyond and look forward to sharing additional updates with you all at our R&D day next month on December 12.
Speaker Change: With that I'll turn it back to the operator to begin Q&A operator.
Speaker Change: As a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced.
Speaker Change: To withdraw your question. Please press star one again.
Speaker Change: In the interest of time, we ask that you. Please limit yourself to one question and one follow up.
Speaker Change: Please standby, while we compile the Q&A roster.
Speaker Change: Our first question comes from Chris <unk>.
Speaker Change: Our economy with true Securities. Your line is open.
Speaker Change: Hey, guys. Thank you so much for taking my question and congrats on all the progress this year.
Speaker Change: I had a question about the Astrazeneca milestone that you mentioned first of all congrats on delivering another AI designed antibody sequence.
Speaker Change: Can you remind us of the economics of this partnership and when we can expect.
Matt: Well, Matt I know you probably part of the restricted.
Speaker Change: <unk>.
Speaker Change: And also does this you said that this is in oncology.
Speaker Change: But this does this in any way validate the potential of what outsized platform can do not just in terms of getting all the design, but also targeting different classes of targets. Thank you.
Speaker Change: Yeah, absolutely thanks, Craig.
Speaker Change: Yes, so we think that this is.
Speaker Change: Really great validation.
Speaker Change: The platform, we are able in six months to deliver.
Speaker Change: Deliver on.
Speaker Change: Our binder that could bind to a target where there was no buy binary and we see this as again I think really great validation.
Speaker Change: And Zach I'll hand, it over to you to talk a little bit about the <unk>.
Zach Johnson: Economics of the deal.
Zach Johnson: Thanks, Sean.
Zach Johnson: As you may recall.
Zach Johnson: Partnership on Astrazeneca.
Zach Johnson: One target deal at $147 million.
Zach Johnson: Biodiesel value, including all of the Upfronts research fees milestones.
Zach Johnson: Royalty associated but that's not disclosed.
Zach Johnson: So it's a fairly traditional structure for a partnership at the drug creation stage.
Speaker Change: Okay. Thank you.
Speaker Change: Yes.
Speaker Change: Thank you.
Speaker Change: And our next question comes from Brendan Smyth with TD Cowen Your line is open.
Speaker Change: Hi, This is Jackie online for Brendan Thanks, So much for taking my question.
Speaker Change: Just looking at both your R&D day, and the upcoming updates that you have for the first half of 'twenty five.
Speaker Change: Can you give us any expectations on what we can reasonably expect data wise.
Speaker Change: What kind of data, which assets will be involved and how much data do you plan on discussing.
Speaker Change: Yeah, absolutely so with <unk> 201 at R&D day, this will be a very similar data package to what we what we presented four.
Speaker Change: 101, our tier one assets.
Speaker Change: And so that will be a robust preclinical data package and we plan to with this.
Speaker Change: Announcer drug candidate on that.
Speaker Change: And then Lee.
Speaker Change: Later in the first half we do plan on presenting.
Speaker Change: To get the data on avs.
Speaker Change: 301.
Speaker Change: And so those are kind of I would say that to me.
Major data Readouts at R&D day, and in the first half.
Great. That's Super helpful. And then just one more as you near IND stage for your tier one are you also planning on using the same manufacturers. The second asset as you did for <unk> hundred one and when we're looking at expected R&D should we kind of picture that ramping similar to 101 over $20 95.
Speaker Change: Yes, we are using the same manufacturer wuxi for ads.
Speaker Change: 201.
Speaker Change: And in terms of overall expense I would assume similar expenses.
Speaker Change: Alright, thank you.
Speaker Change: Thank you again as a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced again that is star one to ask a question.
Speaker Change: Our next question.
Speaker Change: Just before the next question just a quick correction I think believe I gave the wrong number in the prior answer around a astrazeneca partnership.
Speaker Change: $247 million deal I believe I misspoke and said 147.
Speaker Change: But just a correction to that.
Our next question comes from George Farmer with Scotiabank. Your line is open.
Speaker Change: Couple more partnerships you're expecting this year can you say anything more about that.
Speaker Change: Okay.
Speaker Change: Pharma partners are the smaller side.
Speaker Change: Thank you wanted to take that question.
George: Sure. Thanks George.
Speaker Change: What I can say, Georgia as we continue to advance several discussions.
Speaker Change: With the prospective partners here in Q4.
Speaker Change: It's a mix of different types of companies and sizes, that's probably all I can say at this point.
Okay and.
Speaker Change: Just noticed with Avs 301 is that a slight delay I think you've been had been guiding to provide a little bit more.
Speaker Change: <unk> insight into that program.
Speaker Change: By the R&D day, but now it looks like it might be delayed.
Speaker Change: That is correct, we are seeing a slight delay on ABS 301.
Speaker Change: And where we're running at at our CRO.
Speaker Change: This has nothing to do with the actual efficacy.
Speaker Change: The study itself.
Speaker Change: Studies.
Speaker Change: Had been delayed just.
Speaker Change: Just slightly on that.
Speaker Change: Okay.
Speaker Change: Great. Thanks very much.
Speaker Change: Thank you Georges.
Speaker Change: Thank you.
And our next question comes from <unk> Divan with Guggenheim Securities. Your line is open.
Speaker Change: Good morning.
<unk>. Thank you for taking our question.
Speaker Change: My question is on the plant healthy volunteer study for a base Formula One next year understanding that you may be providing additional details about the program at your R&D day next month.
And what you can share to date.
Speaker Change: What would you like to see from that study in terms of antibody half life.
Speaker Change: Do you believe that the borrowers there.
Speaker Change: Yeah. Thank you Christian do you want to take that question.
Christian Steckman: Sure. Thank you for the question.
Speaker Change: Indeed.
Ah correctly mentioned this will be healthy volunteer study and our intention is to measure.
The genetics and the study is as usual and such.
Onto your setting.
Speaker Change: In terms of our expected half life.
Speaker Change: We expect to achieve a profile that is similar for offline engineered antibody.
Speaker Change: At a minimum in case, we expect to win.
Speaker Change: We expect to have dosing levels that allows once monthly dosing potentially up to once quantity.
Speaker Change: Okay. Thank you.
Speaker Change: Thank you.
Speaker Change: Showing no further questions at this time.
Speaker Change: This concludes today's conference call.
Speaker Change: Thank you for participating you may now disconnect.
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