Q2 2025 OmniAb Inc Earnings Call
Formal presentation.
As a reminder, this conference is being recorded I would now like to turn the conference call over to Mr. Kurt Gustafson omni.
Speaker #4: Thank you, operator. And good afternoon, everyone. This is Kurt Gustafson, OmniAb's Chief Financial Officer, and thank you all for joining our second quarter 2025 financial results conference call.
<unk> <unk> Chief Financial Officer, you may begin.
Thank you operator, and good afternoon, everyone.
Speaker #4: There are slides to accompany
Speaker #4: today's prepared remarks, and they're all participants are in ailable in our investors section of our website at omniab.com. Before we begin, I'd ike to remind listeners that comments made during this call by OmniAb's management will include forward-looking statements within the meaning of the Federal Securities Laws.
This is Kurt Gustafson, Chief Financial Officer, and thank you all for joining our second quarter 2025 financial results Conference call.
There are slides to accompany today's prepared remarks, and they are available in our investors section of our website at <unk> Dot com.
Speaker #4: These forward-looking statements involve risks and uncertainties that could cause actual results to be materially different from any anticipated results. These forward-looking statements are qualified by the cautionary statements contained in today's press release and our SEC filings.
Before we begin I'd like to remind listeners that comments made during this call by omni ebbs management will include forward looking statements within the meaning of the federal Securities laws. These forward looking statements involve risks and uncertainties that could cause actual results to be materially different from any anticipated results. These forward looking statements are qualified by the cautionary statements contained in <unk>.
Speaker #4: Importantly, this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast today. August 6th, 2025. Except as required by law, OmniAb takes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call.
Today's press release, and our SEC filings.
Importantly, this conference call contains time sensitive information that is accurate only as of the date of this live broadcast today August six 2025, except as required by law <unk> undertakes no obligation to revise or update any forward looking statements to reflect events or circumstances. After the date of this call.
Speaker #4: Joining me on the call today is Matt Foehr, OmniAb's president and CEO. During today's call, we'll provide highlights on the company's business and operations, partner and technology updates, as well as our recent financial results and outlook.
Joining me on the call today is Matt for <unk>.
<unk>, President and CEO and during today's call. We will provide highlights on the company's business and operations partner and technology updates as well as our recent financial results and outlook.
Speaker #4: And at the conclusion of the prepared remarks, we'll open the call to questions. And with that, let me turn the call over to Matt.
Speaker #5: Thanks, Kurt. And good afternoon, everyone. And thanks for joining us today on our Q2 call. I'll start now with slide number four. As I mentioned on our last call, we started the year with strong deal flow.
And at the conclusion of the prepared remarks, we will open the call to questions and with that let me turn the call over to Matt.
Thanks, Curt and good afternoon, everyone and thanks for joining us today on our Q2 call.
Speaker #5: And this continued in second quarter with a number of new partners added in first half of the year, setting a pace for one of our strongest years yet.
I'll start now with slide number four.
As I mentioned on our last call. We started the year with strong deal flow and it continued in the second quarter with a number of new partners added in the first half of the year setting a pace for one of our strongest years yet.
Speaker #5: We continue to see a robust pace and quality of deals. And we think this is a testament to our differentiated technology platform, which continues to evolve and expand, and to our team's relentless pursuit of innovation that leverages our unique vantage point in the industry.
We continue to see a robust pace and quality of deals.
We think this is a testament to our differentiated technology platform, which continues to evolve and expand and to our team's relentless pursuit of innovation that leverages, our unique vantage point in the industry.
Speaker #5: Our partners are actively advancing programs into human trials, with the start of a new clinical stage program during the second quarter, and several others that are progressing through development.
Our partners are actively advancing programs into human trials with the start of a new clinical stage program during the second quarter and several others that are progressing through development.
Speaker #5: And on the third highlight here on slide four, the recent launch of our exploration partner access program has been very well received. With a strong response from existing partners and others, within weeks of launch, we sold and installed an exploration system and we are managing a robust pipeline leads and business activity this new technology that's expected to be accretive to the business and to further diversify our sources of revenue.
And on the third highlight here on slide four the recent launch of our exploration partner access program has been very well received.
With a strong response from existing partners and others.
Within weeks of launch we sold and installed in exploration system, and we are managing a robust pipeline of leads and business activity for this new technology that is expected to be accretive to the business and to further diversify our sources of revenue.
Speaker #5: Our platform is attracting new partners and facilitating the addition of new programs. We continue to drive efficiencies in our business by leveraging our technologies, including exploration, and by streamlining our business practices.
Our platform is attracting new partners and facilitating the addition of new programs.
Speaker #5: All with the goal of creating long-term and sustainable value for our stakeholders. We've been realigning our staffing needs, and recently reduced some costs and our headcount.
We continue to drive efficiencies in our business through leveraging our technologies, including exploration and through the streamlining of our business practices.
All with the goal of creating long term and sustainable value for our stakeholders.
Speaker #5: This is in addition to the staffing realignment we disclosed back in February, related specifically to the small molecule ion channel element of our business.
We've been realigning, our staffing needs and recently reduce some costs in our head count.
Speaker #5: We began 2025 with 114 employees, and our go-forward headcount is at 87 employees. And Kurt will provide some financial details in his remarks. So in summary here, our outlook for 2025 remains very much on track.
This is in addition to the staffing realignment, we disclosed back in February related specifically to the small molecule ion channel element of our business.
We began 2025 with 114 employees in our go forward head count is at 87 employees.
Speaker #5: And we feel we're extremely well positioned to deliver on our strategic goals, to expand the reach of our technologies, and to execute on our current exploration launch and the upcoming new technology launches that we're also very excited about.
And Kurt will provide some financial details in his remarks.
Okay.
So in summary here our outlook for 2025 remains very much on track and.
And we feel we're extremely well positioned to deliver on our strategic goals to expand the reach of our technologies and to execute on our current exploration launch and the upcoming new technology launches that we're also very excited about.
Speaker #5: Additionally, we're constantly seeking further workflow efficiencies and technology innovations in what we see as a highly scalable review some of our business metrics starting here on slide number five.
Additionally, we're constantly seeking further workflow efficiencies and technology innovations in what we see as a highly scalable business.
Speaker #5: We ended Q2 with 100 active partners. During the second quarter, we signed an asset deal with Angelini Pharma for a small molecule ion channel modulator that targets Kv7.2, which we discussed on our last call.
So now I'll review some of our business metrics starting here on slide number five.
We ended Q2 with 100 active partners.
Speaker #5: In addition, we executed multiple license agreements including new deals with Viraxa Biotech, Duke NUS, the University of Strathclyde, the University of Maryland, AB Ray Bio, and an undisclosed global CRO.
During the second quarter, we signed an asset deal with Angiolini pharma for a small molecule ion channel modulator that targets <unk> seven two which we discussed on our last call in.
In addition, we executed multiple license agreements, including new deals with <unk> biotech, Duke and U S. The University of Strathclyde University of Maryland, <unk> bio and an undisclosed global CRO.
Speaker #5: As you see the slide, we're also providing some updated detail on the distribution of our active partners by type, including discovery, commercial, and academic, as well as the distribution of our partners on a geographic basis.
Okay.
As you see on the slide we're also providing some updated detail on the distribution of our active partners by type, including discovery commercial and academic as.
Speaker #5: Although our partners are mostly based here in the US, there's been a steady diversification of our partner base as we've been successfully increasing the reach of our platform.
As well as the distribution of our partners on a geographic basis.
Although our partners are mostly based here in the U S. There's been a steady diversification of our partner base as we have been successfully increasing the reach of our platform.
Speaker #5: Turning to slide six, you can see the number of active programs increased to 381 as of quarter-end. We've continued to experience positive momentum with a year-to-date net increase of 18 programs.
Okay.
Turning to slide six you can see the number of active programs increased to 381 as of quarter end. We continued to experience positive momentum with a year to date net increase of 18 programs.
Speaker #5: And we're continuing to see the strength in program additions that started late last year. Attrition is obviously a natural and expected element in drug discovery and development generally, and we continue to see, and expect to see, attrition, which can be driven by a variety of factors including partner therapy area focusing, budget decisions, and the timing of receipt of reports or updates from our ners.
And we're continuing to see the strength in program additions that started late last year.
Attrition is obviously, a natural and expected element in drug discovery and development generally and we do continue to see and expect to see attrition, which can be driven by a variety of factors, including partner therapy area of focusing and budget decisions.
Speaker #5: That said, the net addition of 18 programs year-to-date shows some significant strength and is more than double the number of net additions through the first half of 2024.
And timing of receipt of reports or updates from our partners.
That said the.
The net addition of 18 programs year to year to date showed some significant strength and is more than double the number of net additions through the first half of 2024.
Speaker #5: Slide number seven breaks down our 381 active programs by their license type. And summarizes elements of overall contracted downstream economics. Importantly, about 99% of our active programs have potential future economics contractually owed to OmniAb.
Slide number seven breaks down our 381 active programs by their license type and summarizes elements of overall contracted downstream economics.
Speaker #5: The 1% that don't are generally linked to legacy agreements with prepaid licenses that were signed years ago by companies that we acquired. 90% of the programs are linked to what we generally refer to as antibody standard licenses, and 7% are what are through what we call revenue share license agreements where we get a defined portion of whatever form of value our discovery partners get, be that equity, cash, or other forms of value.
Importantly, about 99% of our active programs have potential future economics contractually owed to <unk>. The 1% that don't are generally linked to legacy agreements with prepaid licenses that were signed years ago by companies that we acquired.
90% of the programs are linked to what we generally refer to as antibody standard licenses and 7% are what are through what we call revenue share license agreements, where we get a defined portion of whatever form of value. Our discovery partners get b that equity cash or other forms of value.
Speaker #5: These revenue share deals are mostly with academic institutions that incubate OmniAb-derived assets prior to planned corporate formation events. Our antibody programs have over $3 billion in total remaining contracted potential milestone payments.
<unk>.
These revenue share deals are mostly with academic institutions that incubate omni app derived assets prior to planned corporate formation events.
Speaker #5: And an average royalty rate of 3.36%. This 3.36% average is an increase from an average royalty rate of 3.2% that we reported in November of 2023.
Our antibody programs have over $3 billion in total remaining contracted potential milestone payments and an average royalty rate of 336%.
Speaker #5: I think the ability to command strong royalties reflects the value of our technologies and their relevance to the industry. It also speaks to the value our team is creating for our partners and for our stakeholders.
This 336% average is an increase from an average royalty rate of three 2% that we reported in November of 2023.
I think the ability to command strong royalties reflects the value of our technologies and their relevance to the industry.
Speaker #5: Here now on slide eight, we're putting a bit of a spotlight on the continued growth of the post-discovery stage programs in our portfolio, as well as the advancement of these programs into and through development.
It also speaks to the value of our team is creating for our partners and for our stakeholders.
Here now on slide eight we're putting a bit of a spotlight on the continued growth of the post discovery stage programs in our portfolio as well as the advancement of these programs into and through development.
Speaker #5: During the quarter, a number of new programs progressed to the preclinical stage of development, and another one is recruiting for a phase three clinical trial, which is Immunovan's IMVT1402, for myasthenia gravis.
During the quarter, a number of new programs progressed to the preclinical stages of development and another one is recruiting for our phase III clinical trial, which is <unk> <unk> two for myasthenia gravis.
Speaker #5: We're really encouraged by the expanding number of post-discovery stage programs which have experienced 22% growth from the prior year period. The preclinical programs also have nice diversity of indications, and include inflammation, fibrosis, renal, dermatology, CNS diseases, and others, in addition to the historical strong showing in oncology.
We're really encouraged by the expanding number of post discovery stage programs.
Which have experienced 22% growth from the prior year period.
The preclinical programs I will also have nice diversity of indications and include inflammation fibrosis renal dermatology CNS diseases and others. In addition to the historical strong showing in oncology.
Speaker #5: Importantly, these 61 programs that are post-discovery stage are associated with approximately 1.3 billion dollars in contracted remaining potential milestones to OmniAb. The total potential milestones associated with the later stage programs has continued to increase.
Importantly, these 61 programs that are post discovery stage are associated with approximately $1 3 billion in contracted remaining potential milestones to on the App.
Speaker #5: And that increase has been fairly dramatic in the last 8 to 12 months. And you can see here the contribution of $700 million from small molecule ion channel programs that have now moved into preclinical.
The total potential milestones associated with the later stage programs have continued to increase.
And that increase has been fairly dramatic in the last eight to 12 months.
Speaker #5: We think the growth here demonstrates potential value-creating events in the pipeline. The progress in pipeline overall, as well as our partners' iction, around assets that have been discovered with our technologies.
And you can see here the contribution of $700 million from small molecule ion channel programs that have now moved into preclinical.
Okay.
We think the growth year demonstrates potential value, creating events in the pipeline the progress in the pipeline overall as well as our partners conviction around assets that have been discovered with our technologies.
Speaker #5: Moving now to slide nine, the number of active clinical programs and approved products was 32 at the end of Q2. A new Omni chicken-derived program entered the clinic in the quarter from Seismic Therapeutics, this marks the third Omni chicken-derived antibody to enter human clinical trials, following programs with Berenger-Ingelheim and Teva.
Moving now to slide nine.
The number of active clinical programs and approved products was 32 at the end of Q2.
A new omni chicken derived program entered the clinic in the quarter from seismic therapeutics.
Speaker #5: Through Q2, we've had two novel programs initiate first in human clinical trials in 2025. We've seen attrition or stage of development modification in phase one assets with a CN1 program returned from CURON to Wuji that Wuji now characterizes as preclinical.
This marks the third omni chicken derived antibody to enter human clinical trials following programs with Beringer Ingelheim and Teva.
Through Q2, we've had two novel programs initiate first in human clinical trials in 2025.
We've seen attrition or stage of development modification in phase one assets with a <unk>. One program returned from Huron to Wuxi that Wuxi now characterizes as preclinical and agenda that program that entered an initial phase one trial in Q1, and then exited that trial in Q2 as I've.
Speaker #5: And a GenMab program that entered an initial phase one trial in Q1 and then exited that trial in Q2, as I've said, and as we often say, attrition is a natural part of drug development.
Speaker #5: Based on dialogue with our partners, we continue to see potential for a total of approximately 5 to 7 new entries into clinical development for novel OmniAb-derived programs this year.
And as we often say attrition is a natural part of drug development.
Based on dialogue with our partners, we continue to see potential for a total of approximately five to seven new entries into clinical development for novel Omni Abderite programs. This year.
Speaker #5: Slide number 10 illustrates our clinical and commercial stage partner pipeline for active programs that carry remaining downstream economics. As you see, this pipeline flows from phase one through to later stages and product approvals from left to right.
Slide number 10 illustrates our clinical and commercial stage partner partner pipeline for active programs that carry remaining downstream economics.
Speaker #5: Placement in this graphic is based on a program's most advanced status in any geography or indication. In the last couple of quarters, it's been great to see the growing number of programs moving to the right on this graphic, the latest of which now includes the recent addition of Immunovan's IMVT1402, shown in Phase 3, as I mentioned.
As you see this pipeline flows from phase one through the later stages later stages and product approvals from left to right placement in this graphic is based on a program's most advanced status in any geography or indication.
And the last couple of quarters, it's been great to see the growing number of programs moving to the right on this graphic the latest of which now includes the recent addition of immune advanced <unk> shown in phase III as I mentioned.
Speaker #5: Turning to slide 11, we've highlighted select recent partner updates including presentations at ASCO from J&J and Merck KGA. The disclosed J&J data for their tri-specific 5322 program is especially notable to us with the 100% response rate that was observed in heavily pretreated multiple myeloma patients.
Turning to slide 11, we've highlighted.
Select recent partner updates, including presentations at <unk> from J&J and Merck PGA.
The disclosed J&J data for their Tri specific 500, 322 program is especially notable to us with a 100% response rate that was observed in heavily pre treated multiple myeloma patients.
Speaker #5: The initial data were described as suggesting a potential paradigm shift for the treatment of these patients, so there's a real opportunity with this program to significantly elevate the standard of care for multiple myeloma.
The initial data were described as suggesting a potential paradigm shift for the treatment of these patients. So there's a real opportunity with this program to significantly elevate the standard of care for multiple myeloma.
Speaker #5: J&J indicated publicly that they look forward to seeing the results from planned phase two and phase three
Speaker #5: studies for the
Speaker #5: 5322 program,
Speaker #5: and on their most recent
Speaker #5: earnings call, they
Speaker #5: highlighted these data
J&J indicated publicly that they look forward to seeing the results from planned phase II and phase III studies for the <unk> two program and on their most recent earnings call. They highlighted these data again, while saying they are now quote closer than ever to their ambition of curing multiple myeloma.
Speaker #5: again while saying they
Speaker #5: are now
Speaker #5: "closer than ever to
Speaker #5: their ambition of curing multiple
Speaker #5: myeloma." Other
Speaker #5: highlights shown here include
Speaker #5: Teva receiving FastTrack
Speaker #5: designation for
Speaker #5: TEV408 for the
Speaker #5: treatment of celiac
Speaker #5: disease, and I want to note
Speaker #5: that this program is
Quote.
Speaker #5: also in clinical
Speaker #5: development for
Other highlights shown here include Teva, receiving fast track designation for <unk> for the treatment of celiac disease.
Speaker #5: vitiligo. Teva
Speaker #5: additionally announced a partnership with
Speaker #5: Phosun for myeloma," TEV278, which is
Speaker #5: a partnership established
I want to note that this program is also in clinical development for vitiligo.
Speaker #5: with the goal of accelerating
Speaker #5: clinical development of the
Speaker #5: compound that's in clinical
Speaker #5: trials now for the
Speaker #5: treatment of
Teva Additionally, announced a partnership with Fosun for <unk> $2 708, which is a partnership established with the goal of accelerating clinical development of the compound that's in clinical trials now for the treatment of various forms of cancer, including melanoma.
Speaker #5: various forms of
Speaker #5: cancer,
Speaker #5: including
Speaker #5: melanoma. Now to
Speaker #5: conclude my
Speaker #5: section, here on slide number additionally announced a partnership with
Speaker #5: 12, we've
Speaker #5: highlighted our recently
Speaker #5: launched
Speaker #5: exploration partner
Speaker #5: access
Speaker #5: program.
Speaker #5: Exploration is a high-throughput single
Now to conclude my section here on slide number 12, we've highlighted our recently launched exploration partner access program.
Speaker #5: B-cell screening instrument that
Speaker #5: leverages machine learning
Speaker #5: and
Speaker #5: single-cell screening throughput versus other instruments, which allows users to screen in a far more efficient fashion. We believe this system has unmatched screening
Exploration is a high throughput single B cell screening instrument that Leverages machine learning and AI.
It offers 10 times more single cell screening throughput versus other instruments, which allows users to screen in a far more efficient fashion.
Speaker #5: throughput and
Speaker #5: superior hit
Speaker #5: recovery, along with
Speaker #5: exceptional ease of use and
Speaker #5: reliability. We highlighted
Speaker #5: exploration in a
Speaker #5: presentation at the Boston
We believe this system has unmatched screening throughput and superior hit recovery, along with exceptional ease of use and reliability.
Speaker #5: PEGS conference in May, where the system was awarded Best of Show Honors. Just weeks after launching, we sold and installed exploration at a global partner creating a new revenue stream derived from the sale of the instrument, as well as recurring revenue from proprietary single-use consumables and subscription services for software with
We highlighted exploration in a presentation at the Boston Pegs conference in May where the system was awarded best of show honors.
Speaker #1: screening throughput and superior hit recovery, along with exceptional ease of use and reliability. We highlighted exploration in a presentation at the Boston PEGS conference in May, where the system was awarded Best of Show Honors.
<unk> after launching we sold and installed exploration at a global partner, creating a new revenue stream derived from the sale of the instrument as well as recurring revenue from proprietary single use consumables and subscription services for software with maintenance.
Speaker #5: maintenance. It's still early
Speaker #1: Just weeks after launching, we sold and installed exploration at a global partner, creating a new revenue stream derived from the sale of the instrument, as well as recurring revenue from
Speaker #5: market has been extremely positive. And we're building a pipeline of sales leads from our growing roster of partners based on new availability of the platform, and we're also getting inquiries from others who are interested in becoming OmniAb discovery partners
It's still early in the launch but the response from the market has been extremely positive and we are building a pipeline of sales leads from our growing roster of partners based on new availability of the platform and we're also getting inquiries from others, who are interested in becoming Omnia a discovery partners specific.
Speaker #1: proprietary single-use consumables and business, as it subscription services for software with maintenance. It's still early in the launch, but the response from the market has been extremely positive.
Speaker #1: And we're building a pipeline of
Speaker #1: sales leads from our growing roster of partners supports our mission based on new availability of the platform, and we're also getting inquiries from others who are interested in becoming OmniAb discovery partners specifically to get access to
<unk> to get access to exploration.
With exploration, we are able to further empower partners with the latest technologies to improve their probability of success and it really efficient and scalable manner.
Speaker #1: exploration. With
Speaker #1: exploration, we're able to further empower partners with the
That's part of why we see exploration as a nice complement to our current core business as it supports our mission of enabling the rapid development of innovative therapeutics.
Speaker #1: latest technologies to
Speaker #1: improve their probability of
Speaker #1: success, and it really this is the right time for
Speaker #1: efficient and scalable
Speaker #1: manner. And that's part of
Speaker #1: why we see exploration as
Speaker #1: a nice complement
Speaker #1: to our current core
Speaker #1: business, as it
The feedback we are getting indicates to us that this is the right time for exploration as the industry embraces the value of lab automation and instrumentation for big data generation to also leverage AI and ml aided screening and selection.
Speaker #1: supports our mission
Speaker #1: of enabling the rapid
Speaker #1: development of
Speaker #1: innovative
Speaker #1: therapeutics. The feedback we are
Speaker #1: getting indicates to us
Speaker #1: that this is the right time
Speaker #1: for
Speaker #1: exploration. As the industry
Speaker #1: embraces the value of
Speaker #1: lab automation and
Speaker #1: instrumentation for big data
We're very excited about the prospects of this new offering as it continues to demonstrate our commitment to innovation and customer service, while diversifying our revenue streams.
Speaker #1: generation, to also
Speaker #1: leverage AI and
Speaker #1: ML-aided
Speaker #1: screening and
Speaker #1: selection.
Speaker #1: We're very excited about the
Speaker #1: prospects of this new offering, as it continues to
Speaker #1: demonstrate our commitment to
And with that let me now turn the call back over to Kirk for a discussion of our Q2 financial result results Kurt.
Speaker #1: innovation and
Speaker #1: to customer
Speaker #1: service, while
Speaker #1: diversifying our revenue
Speaker #1: streams. And with
Thanks, Matt.
Speaker #1: that, let me now turn the
On slide 14, I'll start with a review of our revenue.
Speaker #1: call back over
Speaker #1: to Kurt for a discussion of
Speaker #1: our Q2
Speaker #1: financial results.
For the second quarter of 2025, we reported revenue of $3 $9 million compared with $7 6 million for the same period in 2024.
Speaker #1: Kurt?
Speaker #2: Thanks,
Speaker #2: Matt. On slide
Speaker #2: 14, I'll start with a
Speaker #2: review of our
Speaker #2: revenue. For the second
Speaker #2: quarter of 2025,
The decrease was primarily related to lower milestones achieved in the quarter and lower service revenue.
Speaker #2: we reported revenue of
Speaker #2: $3.9 million
Speaker #2: compared with $7.6
Speaker #2: million for the same
Speaker #2: period in
Service revenue declined primarily due to the discontinuation of a small molecule ion channel program last year, which also resulted in the acceleration of noncash revenue in that quarter, which over inflated last year's number.
Speaker #2: 2024. The decrease
Speaker #2: was primarily related to
Speaker #2: lower milestones achieved in the quarter and lower service revenue. Service revenue declined primarily due to the discontinuation of a small molecule ion channel program last year, which also resulted in the acceleration of non-cash revenue in that quarter, which over-inflated last year's number.
The decrease was partially offset by the new exploration revenue this quarter.
And this revenue primarily includes the sale of an instrument as well as the sale of various consumables related to the exploration platform.
Speaker #2: The decrease was partially offset by the new exploration revenue this quarter, and this revenue primarily includes the sale of an instrument as well as the sale of various consumables related to the exploration platform.
Slide 15 shows our cost and operating expenses for the second quarter of 2025.
Which decreased to $20 1 million from $23 $9 million for the prior year period.
Speaker #2: Slide 15 shows our cost and operating expenses for the second quarter of 2025, which decreased to $20.1 million from $23.9 million for the prior year period.
We saw decreases in both R&D and G&A expenses relative to last year.
And I'll go into some of those details here on the next slide.
Speaker #2: We saw decreases in both R&D and G&A expenses relative to last year, and I'll into some of those details here on the next slide.
So turning to slide 16, and focusing on operating expense.
You'll see a new line item for the costs associated associated with the exploration revenue, which were approximately $300000 this quarter.
Speaker #2: So turning to slide 16, and focusing on operating expense, you'll e a new line item for the cost associated with the exploration revenue, which were approximately $300,000 this quarter.
This represents the costs associated with the manufacturing of the exploration of the instrument as well as the related consumables sold in the quarter.
Speaker #2: This represents the cost associated with the manufacturing of the exploration instrument, as well as the related consumable sold in the quarter. Research and development expense was $10.9 million versus $13.9 million a year ago.
Research and development expense was $10 $9 million versus $13 9 million a year ago with the decrease primarily due to lower stock based compensation lower head count as well as lower external expenses associated with the small molecule ion channel programs.
Speaker #2: With the decrease primarily due to lower stock-based compensation, lower headcount, as well as lower external expenses associated with the small molecule ion channel programs.
G&A expense declined to $7 $7 million from $8 million for the same period in 2024 with a decrease primarily due to lower legal fees and lower stock based compensation expense.
Speaker #2: G&A expense declined to $7.7 million, from $8 million for the same period in 2024, with a decrease primarily due to lower legal fees and lower stock-based compensation expense.
The other operating income line includes a gain of $3 million for the sale of the <unk> seven asset Angiolini.
Speaker #2: The other operating income line includes a gain of $3 million for the sale of the KV7 asset to Angelini. Which was partially offset by an increase to our CBR liability associated with this sale.
Which was partially offset by an increase to our CVR liability associated with the sale.
The net loss for the second quarter of 2025 was $15 9 million or <unk> 15 per share compared with a net loss of $13 6 million or 13 cents a share for the same period 2024.
Speaker #2: The net loss for the second quarter 2025 was $15.9 million, or $0.15 per share, which compared the net loss of $13.6 million, or $0.13 a share, for the same period in 2024.
As Matt mentioned.
We had a further reduction to our head count in July.
This reduction is expected to have onetime expenses of about $1 million that will occur primarily in the third quarter.
Speaker #2: As Matt mentioned, we had a further reduction to our headcount in July. This reduction is expected to have one-time expenses of about $1 million that will occur primarily in the third quarter.
We expect that the combination of the actions that we took last February and this one here in July will result in approximately $7 million of annual cash savings going forward.
Speaker #2: We expect that the combination of the actions that we took last February and this one here in July will result in approximately $7 million of annual cash savings going forward.
Turning to slide 17, you will see the balance sheet as of June 32025.
We ended the quarter with $41 6 million in cash and our cash used in the quarter was $2 million.
Speaker #2: Turning to slide 17, you'll see balance sheet as of June 30th, 2025. We ended the quarter with $41.6 million in cash, and our cash use in the quarter was $2 million.
During the quarter, we received milestone payments for Genmab, $10, 78, and <unk> as well as the upfront payment from Angelina <unk> related to the sale of the KD seven asset.
Speaker #2: During the quarter, we received milestone payments for GenMab's 1078, and exosomal Mab, as well as the upfront payment from Angelini related to the sale of the KV7 asset.
So let me conclude with slide 18, with a discussion of our 2025 guidance.
We continue to expect the 2025 revenue will be between 20 and $25 million.
Speaker #2: So let me conclude with slide 18 with a discussion of our 2025 guidance. We continue to expect that 2025 revenue will be between 20 and 25 million.
And operating expense will be between $85 and $90 million.
As a reminder, approximately 40% of our operating expense is noncash mostly due to stock based compensation.
Speaker #2: And operating expense will be between 85 and 90 million. As a reminder, approximately 40% of our operating expense is non-cash, mostly due to stock-based compensation and the amortization of intangibles, primarily from historical company or technology acquisitions.
And the amortization of intangibles, primarily from historical company or technology acquisitions.
We also continue to expect that our cash used in 2025 will be lower than cash used in 2024, and finally, our guidance on the tax rate remains unchanged at approximately zero percent due to evaluation allowance.
Speaker #2: We also continue to expect that our cash use in 2025 will be lower than cash used in 2024, and finally, our guidance on the tax rate remains unchanged at approximately 0% due to evaluation allowance.
And with that I'd like to open up the call for questions operator.
Thank you.
Ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press the star followed by the one on your Touchtone phone.
Speaker #2: And with that, I'd like to open up the call for questions. Operator?
Speaker #3: Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press the star followed by the one on your ouch telephone.
You will hear promptly juergen has been rate should.
Should you wish to decline from the polling process. Please press star two if you are using a speaker phone. Please lift the handset before pressing any Q1 moment. Please for your first question.
Speaker #3: You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press the star followed by the two.
Your first question comes from Puneet <unk> from <unk>.
Speaker #3: If you are using a speakerphone, please lift the handset before pressing any keys. One moment, please, for your first question. And your first question comes from Praneet Sudha from Leerina.
Liana. Please go ahead.
Hi, Thanks for taking my question here, Michael on that to me today.
You're asking a quarter Michael.
Speaker #3: Please go head.
Hi, Mike.
My first question has to do with.
Speaker #4: Hi. Thanks for taking that question. Do you have Michael on for Praneet today? Congrats on the quarter.
Large pharma versus.
Small biotech trend, but we've heard a lot from <unk> talking about small biotech moving forward on their trials and wondering if you're seeing any of that flow through either positive or negative in terms of your discovery.
Speaker #2: Hey, ael.
Speaker #4: Hey. My first question has to do with this large pharma versus small biotech trend that we've heard a lot from CROs talking about small biotech moving forward on their trials.
And any color you can provide there or if it's a completely separate from more later stage.
Speaker #4: I'm wondering if you're seeing any of that flow through, either positive or negative, in terms of your discovery? Any color you can provide there, or if it's completely separate from, I guess, more later stage?
Yes, Michael Thanks for the question this is Matt.
We've been pleased with the continued growth.
Growth in both partners and programs.
Speaker #5: Yeah, Michael. Thanks for the question. This is Matt. You know, we've been pleased with the continued growth in both partners and programs. We saw really nice momentum starting to build in that coming out of last year.
Really nice momentum starting to build in that coming out of last year.
Obviously has continued and you can see it in the performance and the numbers through through Q2, we've had nice net growth in both partners right, which is a nice metric of our technologies and their relevance to the industry and how they are attracting new partners.
Speaker #5: That obviously has continued and you can see it in the performance and the numbers through Q2. We've had nice net growth in both partners, right, which is a nice metric of our technologies and their relevance to the industry and how they're attracting new partners.
As well as programs, we also see a nice mix.
Of large pharma partners, starting up new programs as well as smaller smaller players as well. So we're seeing contributions from both as well as academics, who are now incubating assets to spin those out into companies, but in terms of your question around small and large we are seeing it on both.
Speaker #5: As well as programs, we also see a nice mix of large pharma partners starting up new programs as well as smaller players as well.
Speaker #5: So we're eing contributions from both as well as academics who are now incubating assets to spin those out into companies. But in terms of your question around small and large, we're seeing it on both from both.
<unk>.
Okay, Great and then a quick question on the guide I was wondering if the reiterated guidance continues to exclude any benefit from exploration or if the reiteration or would it be.
Speaker #4: Okay, great. And then a quick question on the guide. I was wondering if the reiterated guide continues to exclude any benefit from exploration or if the reiteration sort of includes expectations now that you're a one quarter in with the launch.
The expectation now that year, one quarter and with the launch.
Yes, I think as we said, we we had indicated that exploration would be additive to what we had I mean this number that we have here in Q2.
Speaker #5: Yeah, I think, you know, as we said, we had indicated that exploration would be additive to what we had. I mean, you'll, you know, this number that we have here in Q2, it's a great start to this, but it's, you ow, pretty small numbers.
It's a great start to this but it's pretty small numbers, but no change no change to the guidance but.
This exploration should be additive to that.
And still no change also Michael.
Speaker #5: But, you know, no change to the guidance, but, you ow, this exploration should be additive to that. Yeah, and still no change. Also, Michael, to the we see exploration as additive and accretive to the business, right, in terms of how it's designed to run.
We see exploration as additive and accretive to the business right in terms of how it's designed to run we've been preparing for this launch for for quite a while.
We're excited about it the feedback has been great.
Speaker #5: We've been preparing for this launch for quite a while, and we're excited about it. The feedback has been great.
Okay. Thank you.
Thanks, Michael.
Thank you Andy.
And your next question comes from Matt Hewitt from Craig Hallum Capital Group. Please go ahead.
Speaker #4: Great, thank ou. Thanks, Michael.
Okay.
Hi, This is Jackson trader on for Matt Congrats on the quarter.
Speaker #3: Thank you. And your next question comes from Matt Hewitt from Craig Howland Capital Group. Please go head.
Okay.
Thanks, Jack wanted to yeah, I wanted to dive into exploration there a little bit seeing revenue flow through I'm curious if you guys could provide a little color on the pipeline as to how that's going maybe even if not number itself give some guidance on that.
Speaker #6: Hi, this is Jackson Schrader from Matt. Congrats on the quarter. Wanted
Speaker #4: Thanks, Jack.
Speaker #6: Yeah, I wanted to dive into exploration there a little bit, seeing revenue flow through. Curious if you guys could provide a little color on the pipeline as to how that's going, maybe even if not numbers, help give some guidance on that.
Yeah, Yeah. Thanks, Jackson, we launched.
The partner access program, obviously in May mid May at the pegs conference in Boston.
Speaker #5: Yeah. Yeah, thanks, Jackson. We launched the partner access program, obviously, in May, mid-May at the PEGS conference in Boston. That a really a perfect place to launch the technology, given the attendees of that meeting.
That was really a perfect place to to launch.
The technology given the attendees of that meeting we were really happy with the reception we got were for.
<unk> best of show, which was which was cool, but a lot more importantly, a lot of really great dialogue kicked off there.
Speaker #5: We were really happy with the reception we got; we were voted Best of Show, which was cool. But a lot more importantly, a lot of really great dialogue kicked off there.
We're now at 100 active partners, obviously, who.
Our candidates if you will for exploration some for some of whom it's more relevant than others. Obviously, just given the business model, but we're really happy with the fact that.
Speaker #5: We're now at 100 active partners. Obviously, who are candidates, if you will, for exploration. Some for some of whom it's more relevant than others.
We sold and deployed an instrument really within weeks of the launch at a global partner.
Speaker #5: Obviously, just given business model. But we were ally happy with the fact that, you know, we sold and deployed an instrument really within weeks of the launch.
And I think that bodes very well for.
For how we're positioned.
Speaker #5: At a global partner, and I think that bodes very well for how we're positioned. The book of business is filling up really nicely. We're managing a lot of business activity around it.
The book of businesses is filling up really nicely, we're managing a lot of business activity around it.
These are obviously capital acquisitions. So the process is slightly different than a standard technology licensing process, but we are really pleased with the.
Speaker #5: These are obviously capital acquisitions. So the process is slightly different than a standard technology licensing process. But we are really pleased with the feedback we're getting and the momentum that the exploration team is building up and for what the technology is doing for the business.
The feedback, we're getting and the momentum that the exploration team.
Is building up and frame for what the technology is doing for the business I'll also note too that we.
We are also getting interest from others, who are not currently on the AD partners, who are sort of leading with exploration wanting to become discovery partners, specifically with exploration in mind.
Speaker #5: I'll also note, too, that we are also getting interest from others who are not currently OmniAb partners who are sort of leading with exploration.
And I think that really speaks to.
Speaker #5: You know, wanting to become discovery partners. Specifically with exploration in mind. And I think that really speaks to some of the comments I made earlier about this really being the right time for exploration from a lot of different perspectives.
Some of the comments I made earlier about this really being the right time for exploration from a lot of different perspectives.
Okay.
Perfect. That's all thank you.
Thanks Jack.
Thank you and your next question comes from Brendan Smith from TD Cowen. Please go ahead.
Speaker #6: Perfect. That's all. Thank ou.
Speaker #4: Thanks, Jack.
Hey, guys. Congrats on the quarter. This is jackie on for Brandon.
Speaker #3: Thank you. And your next question comes from Brendan Smith from TD Cowan. Please go head.
I would say January what that timeline looks like for existing partners that want to become a part of the access program.
Speaker #7: Hey, guys. Congrats on the quarter. This is Jackie on for Brendan. I was just curious.
Is it kind of a blanket requirement to purchase an instrument or are you guys also offering and sort of data generation side separately for those partners.
Speaker #4: Hey, Jackie.
Speaker #7: What that timeline looks like, for existing partners that want to become a part of the access program. You know, is it kind of a blanket requirement to purchase an instrument, or are you guys also offering a sort of data generation side separately for those partners?
Yeah, Yeah. Good good question Jackie.
Obviously exploration I'll, just kind of step back first and say exploration has been a part of our workflows internally.
Speaker #5: Yeah. Yeah, good question, Jackie. Obviously, exploration, I'll just kind of p back first and say exploration has been a part of our workflows internally for many years, right?
For many years right and and.
And Thats kind of what I mean in terms of us preparing for exploration launch and deployment for partners for a while.
Speaker #5: And that's kind of it. I mean, in terms of us, you know, preparing for exploration launch and deployment for partners for a while. Exploration's also been a key part in how we leverage big data generation or AI and ML tools that we've branded OmniDeep.
Exploration has also been a key part in how we leverage big data generation.
Our AI and ml.
Tools that we've branded omni deep.
And those are all things that we continue to do for our standard discovery partners right. So.
And that also attracts partners at not only the the ability to get access to four species of animals in novel Repertoires of.
Speaker #5: And those are all things that we continue to do for our standard discovery partners, right? So that also attracts partners not only the ability to get access to four species of animals and novel repertoires of fully human antibodies, but also those downstream workflow abilities that we've built up over time that allow us to, you know, provide them with a wealth of winners, if you will, from an antibody sequence perspective.
Fully human antibodies, but also those downstream workflow abilities that we built up over time that allow us to provide them with a wealth of winners. If you will from an antibody sequence perspective, so our partners still get access to that Theres still get access to exploration through us that said there are some partners who have.
Their own wet labs and are interested in and are doing the amount of work and the number of campaigns per year that.
Speaker #5: So our partners still get access to that. They'll still get access to exploration through us. That said, there are some partners who have their own wet labs and are interested and are doing the amount of work and the number of campaigns per year that have it make ense for them to have an exploration instrument in-house.
It makes sense for them to have a exploration instrument in house. So the answer is really no change to how we interact with our partners in terms of data generation and sharing.
But now.
Speaker #5: So the answer is really no change to how we interact with our partners in terms of data generation and sharing. But now, you know, certain partners obviously have the ability to buy an exploration instrument.
Certain partners, obviously have the ability to buy an exploration instrument.
We're going to add yeah, Let me, let me add on Jackie So, let's say somebody comes to us and they're interested in.
In exploration instrument and they are not currently a partner.
Speaker #5: Kurt's going to add to that.
Speaker #4: Yeah, let me add on, Jackie. So let's say somebody comes to us and they're interested in an exploration instrument, and they're not currently a partner.
We'll have that dialogue and say, we let them know that this is a partner access program.
And if their interest in becoming a partner then we would work out and do a license with them to give them access to our technology stack and.
Speaker #4: You know, so we'll have that dialogue and say, you know, we let them know that this is a partner access program. And if they're ested in becoming a partner, then we would work out and do a license with them to give them access to our technology stack and, you know, could kind of be done at the same time.
Be done at the same time, they'll sign that license to become a partner and then we could engage in the discussion on the sale of an exploration units. So that's how it would work.
Speaker #4: They'll sign that license to become a partner, and then we could engage in, you know, the discussion on the sale of an exploration unit.
Yeah, that's awesome and Super helpful. I appreciate the color, maybe just obviously you might not be able to say much about this but any color on where you expect your second <unk> launched a land regarding maybe whether it's going to be kind of continuing more on this.
Speaker #4: So that's how it would work.
Speaker #7: Yeah, that's awesome and super helpful. I appreciate the color. Maybe just, obviously, you ight not be able to say much about this, but any color on where you expect your second tech launch to land regarding maybe whether it's going to be kind of continuing more on this AI/ML data portfolio side or more towards the antibody legacy business?
Well data portfolio side or more towards the antibody legacy business.
Yeah, Yeah, great Great question Jackie.
I will say, we are planning an additional technology launch this year.
Speaker #5: Yeah, yeah, great, great question, Jackie. I will say we are planning an additional technology launch this year. We've generally launched our new technologies at major scientific conferences that are very relevant to our partner set, right?
<unk> generally launched our new technologies at major scientific conferences that are very relevant to our partners right.
The technology, we're going to launch is informed by obviously the deep relationships, we have with our 100 partners.
Speaker #5: The technology we're ing to launch is informed by, obviously, the deep relationships we have with our 100 partners, and growing as, and also kind of leverages that vantage point that we have on the industry.
And growing as and also kind of Leverages that vantage point that we have on the industry. So we.
We will talk more about it when we launched it I'll just say we will launch it this year.
It is.
Certainly highly relevant to our strategic mission to help partners discover.
Speaker #5: So we'll talk more about it when we launch it. I'll just say we will launch it this year. It is, you ow, certainly highly relevant to our strategic mission to help partners discover antibodies more quickly and efficiently.
Discover antibodies more quickly and efficiently and we think it will actually be a pretty impactful one with a lot of novelty to it.
Yeah.
Great. Thank you.
Speaker #5: And we think it'll actually be a pretty impactful one with a lot of novelty to it.
Thank you and your next question comes from Stephen Willey from Stifel. Please go ahead.
Speaker #7: Great, thank you.
Yes. Good afternoon, thanks for taking the question.
Speaker #3: Thank you. And your next question comes from Steven Willie from Stippel. Please go head.
Just with respect to the answer and Tri specific data does look quite interesting.
Speaker #8: Yeah, good noon. Thanks for taking the estion. Just with respect to the Janssen trial-specific, the data does look quite interesting. Does that fall into the grandfathered prepaid license bucket?
Does that fall into the grandfathered.
<unk> license bucket I guess I asked the question because I know that.
Prior by specific yes, I got it.
<unk>.
Daclizumab I believe was also prepaid in nature.
Speaker #8: I guess I asked the question because I know that the prior bispecific that Janssen got approved, Clistamab, I believe, was also prepaid in nature.
Sure.
Steve Good question.
You are correct in that the disclosed economics around the Janssen deal.
Speaker #5: Steve, good question. You're correct in that the disclosed economics around the Janssen deal actually it wouldn't qualify as prepaid as you've described it here.
Actually it wouldn't qualify as prepaid as as you've described it here they are actually at $35 million of milestone payment associated with first sales.
Speaker #5: There are actually 35 million dollars of milestone payment associated with first sales. And that's the same path that was disclosed back when TechVali was approved and launched in the US and Europe.
The same path that was.
Disclosed back when <unk> was approved and launched in the U S and Europe.
So there is a payments associated at launch so it wouldn't it's not a fully paid license.
Got it understood and then.
Speaker #5: So there's a payments associated at launch. So it wouldn't, it's not a fully paid license.
I understand it's still early in exploration and it's probably hard to do.
Guidance around.
Speaker #8: Got it. Understood. And then I understand still early in exploration and it's probably hard to give guidance around anything at this point, but just curious if you guys have a rough estimate that you might be willing to proffer up with respect to, you ow, what the backend stream of consumable and subscription revenue may look like on a per-instrument basis?
Alright anything at this point, but just curious.
Hey, guys.
A rough estimate that you might be willing to proffer up with respect to.
What the back end.
Stream of consumable and subscription revenue may look like on a on a per instrument basis is that a number that you guys would be willing to disclose or is there I guess kind of in the industry you referenced that you would.
Point us to.
Speaker #8: Is that a number that you guys would be willing to disclose, or is there, I guess, kind of an industry reference that ou would point us to?
Yes.
It's a good it's a good question, Steve I mean.
We have estimates of what we think those might be but it actually varies.
Speaker #4: Yeah, it's good question, Steve. I an, we have estimates of what we think those might be, but it actually varies depending on the customer that's using it.
Depending on the customer that's using it so.
I don't think were ready to provide with those estimates are at this point.
But it could be different depending on the type of customer that is using the instrument.
Speaker #4: So I don't ink we're ready to, you know, provide what those estimates are at this point. But it could be different depending on the type of customer that is using the instrument.
So I don't know anything yes, I think it's still yes, nothing really to add there other than it is still early days, but it is.
It's a high margin business on the backend, which I think bodes very well for for the exploration line.
Speaker #4: So I don't know, Matt, anything else?
Speaker #5: Yeah, I think it's still, yeah, nothing really to add there other than it is still early days. But it is, it's a high-margin business on the backend.
Okay and then.
Speaker #5: Which I think bodes very well for the exploration line.
You talked about the seismic molecule being the third.
<unk> derived antibodies into the clinic.
Speaker #8: Okay. And then you talked about the seismic molecule being the third Omni chicken derived antibody under the clinic. Do we know just, I guess, roughly of what proportion of those assets that are preclinical and beyond, I guess it's those 61 assets are derived off of that platform as well?
We know just I guess roughly.
What proportion of.
Those assets that are preclinical and beyond I guess those 61 assets are.
Sure.
Our derived off of that platform as well.
And does that.
That technology tend to command a bit of a higher royalty rate relative to the average or relative to the overall average.
Speaker #8: And does that technology tend to command a bit of a higher royalty rate relative to the average all relative to the overall average of the portfolio that you provided?
The portfolio that you provided.
Yes, Steve obviously a range of.
Of royalties as you look across our full portfolio right and as that mix has evolved.
Speaker #5: Yeah, Steve, obviously, a range of royalties, as ou look across, are full portfolio, right? And as that mix has evolved, we're seeing improvement in the average royalty with evolution of the mix across the portfolio.
We're seeing improvement in the average royalty with with evolution of the mix across.
The portfolio.
You're sort of speaking generally about the chicken platform as I said, we've had three now omni chicken derived antibodies entered the clinic at chicken generally has within it a number of technologies are standard on a chicken, which obviously is a chicken that produces fully human antibodies.
Speaker #5: Just sort of speaking generally about the chicken platform, as I said, we've had three now Omni chicken derived antibodies enter the clinic. Chicken generally has within it a number of technologies.
Sequences. We also have on the clinic, which is a chicken with a common light chain that also.
Speaker #5: Our standard Omni chicken, which obviously is a chicken that produces fully human antibody sequences. We also have OmniClick, which is a chicken with a common light chain that also produces fully human sequences, really designed specifically around bi-specifics.
<unk> fully human sequences really designed specifically around bi specifics, we launched omni gab.
Not that long ago that year, and a half or so ago, which is a chicken that produces domain antibodies, which are really interesting in CNS and in other areas.
Speaker #5: We launched OmniDab, you know, not that long ago, about a year and a half or so ago, which is a chicken that produces domain antibodies, which are really interesting in CNS and other areas.
And then we continue to innovate around the chicken as well, it's a highly differentiated.
Technology for a lot of reasons.
Speaker #5: And then we continued to innovate around the chicken as well. It's a highly differentiated technology for a lot of reasons. In terms of the questions around the 61 programs that are post-discovery stage or preclinical or later, there are definitely a number of chicken programs in there.
In terms of the questions around the 61 programs that are.
Post discovery stage or preclinical or later there are definitely a number of chicken programs in there in.
In fact, we haven't omni gab represented in there as well, which is a pretty quick progression for a for a newer technology, but.
Speaker #5: In fact, we have an OmniDab represented in there as well. Which is a pretty quick progression for a newer technology. But we've not kind of ken it down by source technology at this point.
We've not broken it down by source technology at this point.
Understood Thanks for taking questions.
Thanks, Steve.
Thank you.
And your last question comes from Connor.
Speaker #8: Understood. Thanks taking the questions.
<unk>.
Speaker #4: Thanks, Steve.
RBC capital markets. Please go ahead.
Speaker #3: Thank you. And your last question comes from Connor McNimaner. RBC Capital Markets, please go head.
Hi, This is Eric Carter on for Conor congratulations on the quarter.
I just had a question about the.
Business plan for exploration is that mostly selling instruments and then also selling consumables or is that a.
Speaker #9: Hi, this is Xavier Carter on for Connor. Congratulations on the quarter. I just had a estion about the business plan for exploration. Is that mostly selling instruments and then also selling consumables, or is that a reagent rental kind plan that you want to do with the exploration?
Reagent rental kind of plan that you wanted to do with the exploration.
Yes. It is.
Selling instruments Youre right that the way you described it where we will sell instruments to partners.
Speaker #5: Yeah, it is selling instruments. You're right that the way you described it, where we will sell instruments to partners. And then downstream of that, they will buy from us proprietary consumables as well as software license with maintenance as well.
And then downstream of that.
They will buy from us proprietary.
Consumables as well as software license with maintenance as well there are two primary consumables, which are our chips and plates that are needed for four runs of the instrument.
Speaker #5: There are two primary consumables, which are chips and plates. That are needed for runs of the instrument.
Perfect.
Just.
Congratulations with the new additions of programs and partners.
As you look in your funnel with folks who are looking at the platform. What are some of the themes that youre seeing for the programs.
Speaker #8: Perfect. And just congratulations with
Speaker #4: the new additions of programs of partners. As you look in your funnel with folks who are looking at the platform, what are some of the themes that you're eing for the programs that your partners are exploring?
Your partners or exploring.
Has it changed from oncology to CN.
CNS or infectious diseases or could you give the broad themes as to what Youre seeing right now.
Speaker #4: Has it changed from oncology to CNS or infectious diseases? Or could you ive just broad themes as to what you're seeing right now?
Yeah, Great Great question, one of the things that we do think about when we innovate around new technologies is kind of not only where the industry is right now, but where the industry is headed and I think now with.
Speaker #5: Yeah, great question. You know, one of the things that we do think about when we innovate around new technologies is, you know, kind not only where the industry is right now, but where the industries headed.
381 programs growing over 100 partners continues to grow we have a pretty interesting vantage point on the industry and so we think about what technologies are partners want. We also think about ways to diversify our platform and diversify our portfolio I should say from.
Speaker #5: And I ink, you know, now with, you ow, 381 programs growing over 100 partners, you know, continues to grow. We have a pretty interesting vantage point on the industry.
Speaker #5: And so we think what technologies partners want. We also think about ways to diversify our platform and diversify our portfolio, I should say, from a therapy area or, you know, other use perspective.
A therapy area or or.
Other other use perspective, so we look into our preclinical assets we see.
<unk> oncology as you as you would expect in the industry, but we also see inflammation fibrosis renal dermatology growing subset of CNS diseases.
Speaker #5: So we look into our preclinical assets. We see, of course, oncology, as you'd expect in the industry, but we also see inflammation, fibrosis, renal, dermatology, growing subset of CNS diseases.
We see.
Metabolic.
See a lot of interesting trends in the discovery phase as well as.
Speaker #5: We see some, you know, metabolic. We see a lot of interesting trends in the discovery space as well as, you know, my perception is that as big pharma starts to take bigger swings, at bigger areas, we see that in the types of targets they're going after.
My perception is that as big pharma starts to take bigger swings at bigger areas.
We see that in the types of.
Targets are going after so.
It's a cool vantage point on the industry, but we're also seeing a lot of of diversity there forming in our pipeline.
Speaker #5: So it's a cool vantage point on the industry, but we're also seeing a lot diversity there forming in our pipeline.
Okay.
Thank you.
Yes. Thanks.
Thank you.
There are no further questions at this time, Mr. Matt for you May proceed.
Speaker #4: Thank you. Yep. Thanks, Jose.
Thank you all for joining our call today, we appreciate your interest and engagement with <unk>, we look forward to discussing our third quarter financial results at our next conference call, which will be in early November.
Speaker #3: Thank you. There are no further questions at this time. Mr. Matfort, you may proceed.
Speaker #5: Thank you all for joining our call today. We reciate your interest and engagement with OmniAb. We look forward to discussing our third quarter financial results at our next conference call, which will be in early November.
In the meantime, we're looking forward to participating in a number of investment conferences in the coming weeks and months and we will announce those details shortly so I think again.
Speaker #5: In meantime, we're looking forward to participating in a number of investment conferences in the coming weeks and months. And we'll announce those details shortly.
And have a nice afternoon.
Ladies and gentlemen. This concludes today's conference call. Thank you very much for your participation. You may now disconnect have a great day.
Speaker #5: So thanks again. And have a nice afternoon.
Speaker #5: specifically to get access to exploration. With exploration, we're able to further empower partners with the latest technologies to improve their probability of success in a really fashion.
Speaker #5: efficient and scalable manner. And that's part of
Speaker #5: why we see exploration as We believe this system a nice complement has unmatched
Speaker #5: to our current core
Speaker #5: of enabling the rapid development of
Speaker #5: innovative
Speaker #5: therapeutics. The feedback we are
Speaker #5: getting indicates to us that
Speaker #5: exploration.
Speaker #5: As the industry
Speaker #5: embraces the value of
Speaker #5: lab automation and
Speaker #5: instrumentation
Speaker #5: for big data
Speaker #5: generation, to also
Speaker #5: leverage AI and
Speaker #5: ML-aided
Speaker #5: screening and
Speaker #5: selection. We're very excited about the prospects
Speaker #5: of this new offering, as
Speaker #5: it continues to
Speaker #5: demonstrate our commitment to
Speaker #5: innovation and to
Speaker #5: customer
Speaker #5: service while
Speaker #5: diversifying our revenue
Speaker #5: streams. And with
Speaker #5: that, let me now turn the
Speaker #5: call back over
Speaker #5: to Kurt for a discussion of
Speaker #5: our Q2 financial
Speaker #5: results.
Speaker #5: Kurt.
Speaker #4: Thanks,
Speaker #4: Matt. On slide
Speaker #4: 14, I'll start with a
Speaker #4: review of our
Speaker #4: revenue. For the second quarter
Speaker #4: of 2025, we
Speaker #4: reported revenue of $3.9 million
Speaker #4: compared with $7.6
Speaker #4: million for the same
Speaker #4: period in
Speaker #4: 2024. The decrease
Speaker #4: was primarily related to lower
Speaker #4: milestones achieved in the
Speaker #4: quarter and lower service revenue.
Speaker #4: Service revenue
Speaker #4: declined primarily due to the
Speaker #4: discontinuation of a
Speaker #4: small molecule ion
Speaker #4: channel program last
Speaker #4: year, which also resulted in
Speaker #4: the acceleration of
Speaker #4: non-cash revenue in that
Speaker #4: quarter, which
Speaker #4: overinflated last year's
Speaker #4: number. The
Speaker #4: decrease was partially offset by the new exploration revenue this