Oxford Biomedica plc

And obviously, good morning to those on the other side of the ocean. Thank you so much for joining today's analyst briefing for our 23 preliminary results. I'm Frank Mathias, the CEO of Oxford Biomedica. And it's a pleasure to see so many familiar faces here in this room. So thank you for coming. to be here to speak to those on the webcast and those joining via the conference call lines today. With me, I have our Chief Financial Officer, Stuart Painter, our Chief Commercial Officer, Dr. Sébastien Ribault, and I'm also proud for the first time to have joining me Thierry Cournais, our relatively new appointed Chief Operating Officer, who is also in charge of the UK operations. As I believe that you have all met Stuart and Sébastien before, I will let Thierry introduce himself when he starts his section of the presentation shortly. So looking at 2023, it's obvious that 2023 was a year of transformation for Oxford Biomedica as we began building a global pure place cell and gene therapy CDMO. Throughout the year, we have met significant milestones and celebrated many successes. which have provided me and the board with confidence in our new strategy and its ability to deliver long-term sustainable growth. I will begin this presentation by highlighting these achievements and the progress we have made to transform the company before handing over to Thierry to discuss the integration and transformation of our global operations in greater detail. Sébastien will then provide an update on the strong momentum we are seeing on the commercial side, and Stuart finally will give an overview of our financial performance for the year and also a mid-term outlook. So this, obviously, yeah. Right? Okay. So, mission. As you know, at the core of our At Oxford Medical, we have our mission to enable our clients to deliver life-changing therapies to patients. This mission underpins the incredibly important work we do, and the strategy that we are implementing is geared towards helping us achieving this by providing best-in-class CDMO practices and accelerating the time it takes to our clients to bring their treatment to the market. I will return to a slide we showed in September last year for our interim presentation when we announced our three pillar plan. As you will soon hear, we are progressing through the plan to deliver long-term sustainable growth and have moved into the implementation phase now, delivering on what we have promised last year. In the last year, we took important steps towards our vision of becoming a global pure play world-leading CDMO in cell and gene therapies, increasing our geographical footprint into now three geographies, UK, US, and recently the European Union. We are organizing and aligning our operation and streamlining our structure. The ongoing transformation will provide us with a multi-vector, multi-site model, giving us a platform to better serve our clients through offering greater flexibility while benefiting from synergies at the same time. As part of our move to a multi-vector, multi-site model, we have made significant progress in transferring our lentiviral vector capabilities into our Bedford site near Boston. The first production runs were initiated in February this year, and we delivered the 5-liter scaled-down model process and accompanying analytics at the end of March already. In January this year, we were delighted to announce that we had acquired ABL Europe from Institut Merieux in France. This extremely important strategic acquisition increases access to EU-based clients and broadens our international development, manufacturing and testing presence, and further increases our capacity in process and analytic development, as well as early-stage manufacturing. The addition of the two sites in France adds approximately 150 CDMO experts to the group, as well as additional vector times to our client offering. It also positions us well to seize further opportunities in the fast-growing cell and gene therapy sector. For aligning our footprint in the UK, the US, and EU, we have put in place our new OneOXP strategy to harmonize and optimize our operations so that we can benefit from increased efficiency and agility. The transformation of the company to a pure-place CDMO is allowing us to scale up our operations globally while maintaining high standards of quality and innovation. As part of our evolution, we have implemented extensive cost management initiatives and refined our structure. By doing so, we laid the foundation for sustainable growth and profitability while leveraging our expertise in viral vector manufacturing. As a quality and innovation-led CDMO, we are committed to reducing cost per dose and accelerating clinical development, thus expanding patients' access to life-changing therapies. Our latest innovation, the TetraVectra system, is a prime example of this. Launched in May 2023, this fourth-generation antiviral vector delivery system allows for higher-quality viral vectors with higher potency and safety. That enables cells and gene therapy companies to overcome previous barriers in therapeutic development. As a result of all these activities, we are already seeing the first successes of the new strategy demonstrated in 2023 by a 51% increase in the business development pipeline and a 54% growth in the client order value as shown on this slide. These successes give me full confidence in the medium-term guidance we have provided, which is supported by strong KPIs for the year to date. This includes 31% growth in the business development pipeline, which now stands at US$573 million, and growth in the number of clients and client programs to 35 and 51, up from 18 and 34, respectively, as reported in April last year. Furthermore, we saw an increase in the number of late-stage and commercial programs from two to five. This increase in the number of clients and programs has led to an 11% growth in revenue backlog for the year to date, which stood now at £104 million at the end of March. I would like to note that this figure excludes a new order with a U.S. client preparing for commercial launch, which we announced in March recently. As you can see, we made and continue to make immense progress, and I would also like to highlight that a lot of this progress has been made since September last year, so in the last six to seven months. All this allows me to reiterate the guidance communicated to the market recently. We expected full-year 2024 revenues to grow by 40% to 50% over last year and to achieve broadly break-even in 2024, as mentioned before. So I will now hand over to Thierry to discuss our OneOXP transformation and integration workstream. Thank you. Thierry, don't forget to introduce yourself.

Thank you, Franck. So Thierry Cournaz, I'm actually the Chief Operating Officer for Oxford Biomeca. I'm also the site head for the UK site. I joined the company last October after 27 years in a large company organization, pharmaceutical industry, with different experience in sales, marketing, and operation. I'm pleased to be here with you today. So as Franck highlighted, we have a new strategy to become one OXB. We have laid down different initiatives, and we focus on six strategic pillars to integrate and transform the company. Within these six strategic pillars, we have structured 20 work streams, globally aligned with different experts from the different geographies. which focus on leading the transformation of the organization to become a pure-play CDMO with a global network. This slide is illustrating this strategy and some of the examples which can explain the advancement that we take in transforming the organization. So we focus first on the quality of our people and experts in the organizations. We want this company to get one company culture with the same values. We want to become a workplace for a CDM expert to join and drive the client project. We focus as well on becoming a client centric organization as a pure place CDMO focusing on executions, high quality delivery. We have work on looking at our efficiency on how we organize to ensure that we increase resource allocation and client product. We have developed strong activities toward our CDMO services and our portfolio, refining our go-to-market strategy and intensifying our marketing efforts and brand recognitions to be seen as global CDMO players in the cell and gene therapy space. In terms of increasing the revenue and increasing the returns, we look at streamlining our processes, ensuring efficiency gain, and implementing site-based structures in the three geographies in the US, in the UK, and in France. Last but not least, we continue to invest in innovations, making sure that our innovation roadmap is focusing on the client needs to accelerate their pipeline and to reduce their cost. And I will hand over to Sébastien.

The initiatives that were described by Thierry have four objectives to help the company grow and take on more projects. Why do we need to take more projects? Because the market is growing, as we see here on this slide. The company has been known for a long time as a lentivirus-only company. And with the acquisition of our site in Bedford about two years ago, we are now delivering routinely AV and lentiviruses. There was also an experience with the AstraZeneca COVID vaccine in developing adenovirus-based vaccine. And that's why we continue to focus on the adenovirus market as well. If we're looking at the market as it is today, we're shy of a $3 billion market size, with a growth that is estimated between 2024 and 2028 of about 20% year-on-year, to reach almost $6 billion in 2028. Interestingly, the three key segments that we're serving, AVs, Lenti and Adeno, keep growing. And not only they grow in the US and in Europe, but they also grow in Asia. And that is the reason why we wanted to make sure we would have enough capacity to serve the clients wherever they are. That drove the acquisition of the site in Bedford, Massachusetts. That also drove the acquisition of the two sites in Lyon and in Strasbourg. We've seen the FDA and EMA and other regulatory agencies in the world approving new programs, meaning that the maturity of that space is increasing. We continue to see a shift that started some years ago from treatment to cure. and the perception of the standard treatment is shifting as well. So cell and gene therapy was a fourth line of treatment, became a third line of treatment, and some of the recent ones have been approved as a second line of treatment as well. More programs, but also more capacity need as we're serving more and more patients. The biotech funding situation is still... But difficult if you're at early stage in a very small company. We've also seen some of our mature to very mature accounts being well funded. And that's the reason why, as we'll see later on this deck, we've been able to progress significantly projects and programs that were a late stage and will very soon be at the manufacturing stage. We have a healthy mix of clients today, as I said, serving AV, Lenti and adenoviruses, but also other vectors. And I will not list everything here. If we start by looking at the volume of contracts, the difference between 2022, excluding COVID, and 2023 is about 54%. If we're looking at the number of contracts that we've signed in percentage here compared to the market, on the market about 4% of the projects are coming from the big pharma. About 20% of the new projects we've signed in 2023 are coming from the same big pharma. We see that if the market is about 24% with the established biotech, well-funded, it corresponds to 23% of the new contracts that we've signed in 2023. And 72% of the market is with emerging biotech, and that corresponds to 57% of the new contracts that we've signed. We made sure that the portfolio was well balanced to avoid the issues linked to funding. The more early stage you go, the more emerging biotech you go, the more issues you will find. The more you go towards emerging biotech and big pharma, the less funding issues you will have. But you will also find by far less projects with the established biotech and the big pharma. That's why the portfolio needs to be well balanced. Talking about the balance, you can also compare on the right side of the slide the markets to the vectors that we're delivering to our clients. And as I said, the company was very well known during many years as a Lenti-only company. And that's why still today about 50% of the projects that we're delivering are Lenti projects. But if you think about 2022, when the company was not known at all for being an AV player, we've literally moved from zero to 41% of the project being AAV. So our clients have well understood that the track record we had in Lenti, the quality level that we have on Lenti, that could be replicated with AAV and that's why we've seen a very strong growth in the AAV space in 2023. Adeno, as I said, we had the experience with the AstraZeneca COVID vaccine. We continue to serve clients who have Adeno projects, whether we're talking about oncolytic viruses or a more simple Adeno-type project. Last but not least, I mentioned that we're delivering on other vectors. As you see, it's about 3% of our portfolio, and I anticipate that it will continue through 2024. We've seen a significant growth of the orders, but before the orders, we have the pipeline of opportunities. We've seen quite a strong growth between 2022 and 2023, moving from $291 million to $438 million. And if you look at the first number that we can disclose now in 2024, we're at $573 million. Which means that between 2022 and today, we've pretty much doubled the size of the pipeline. We've expanded the number of vectors that we're offering to clients. We've expanded the number of clients. We've expanded the number of programs per existing clients as well. And we've grown the pipeline in Europe. When back in 2022, the vast majority of our clients were US-based, we now have a much better balance between Europe, who's at about 30% of our overall pipeline, versus US. Frank mentioned during his introduction the launch of TetraVecta, part of our Lantivector platform. We've also launched an AEV platform, Innovate, that you see here. And there will be some more news coming through 2024. We continue to capitalize on existing technology. We continue to innovate. And we continue to be ambitious about being recognized as an innovation and quality-led CDMO. The number of late-stage and commercial programs are growing. As any CDMO, we want a well-balanced portfolio of active programs. We had a number of clients at early stage. Now we have a more balanced portfolio of clients with about 46 projects as of April 2024, being between preclinical and phase 2. Three of these programs are late stage, meaning phase three. And for two of these programs, we have commercial agreements, meaning that we're either already producing for a commercial product or preparing for the commercial launch of a new product. That is giving us a total of 51 to be compared to 28 as of 2022. And we're now serving clients, as you can see from the logo at the bottom of the page, on many different types of vectors, as it was our plan when we spoke about a year ago. It was important to grow the capacity. It was important to add some new capabilities. It was also important to give access to our clients who want to be next to our process development scientists, analytical development scientists or GMP teams when the activities happen in our plants, which was one of the drivers of the acquisition of the two new sites in Lyon and Strasbourg that we acquired from ABL Europe. So the geographical location was one of the drivers. Increasing the number of vectors that we can deliver was another one of these drivers. And you see here some examples listed of vectors that we inherited from ABL. The last driver was to be able, as I said earlier, to deliver for all geographies. And obviously, having now two sites in continental Europe is giving us the opportunity to deliver in Europe for Europe. but also deliver for some of our APAC customers who wanted to have a delivery site in Europe when they want either to target the European market or minimize the time difference with, for example, U.S. when they are historically working with the U.S. CDMO. So we'll continue to strengthen our commercial efforts to fill these capacities. And Thierry already demonstrated that the integration effort is ongoing to make one OXB out of these three geographies. I'm going to now hand over to Stuart for the financial part.