Oxford Biomedica plc

And good morning to those on the other side of the ocean. Thank you for attending today's analyst briefing on our interim results for the six months ended June 30, 2024. It's always my pleasure to speak to you today for my fourth set of OXP results. It's also a great pleasure to see so many known faces, familiar faces here in the room. Thank you for joining us. With me today, and I'm proud to say, our newly appointed chief financial officer, Lucy Crabtree, who many of you already know probably from the past and who joined us just three weeks ago, exactly three weeks ago, Lucy. We are very excited to have you on board, Lucy, and as we embark on a very new or next chapter, let's say, of our journey. And I will let Lucy introduce herself when we start her part in the presentation shortly. I'm also delighted to have our Chief Business Officer, Dr. Sébastien Riboud, with us, whom you already know from the past. You will hear from both of them in due course throughout this presentation. Also with us in the room is Stuart Painter, our former CFO for the Q&A section, eventually. And he has recently, as you know, handed over the reins to you, Lucy. Disclaimer. Here's the agenda. In terms of the agenda for our briefing today, we'll begin by providing an overview of the key achievements across the business since the start of the year, before handing over to Sébastien to provide an update on the business development pipeline and the strong momentum we are seeing currently on the commercial side. Lucy will then provide an update on our financial performance, and then she will hand back to me to wrap up before we start the Q&A session. So, in line with the three pillar plan outlined last year, we are seeing a strong momentum in all areas of OAXB. Indeed, the first half of 2024 has been a period focused on continuing to deliver on our pure place CDMO growth strategy, which was put in place shortly after I joined OXB in March 2023. We have indeed made significant progress in further integrating our global operations to better serve our clients and realize synergies. Under the OneOXP strategy, we have now moved to multi-vector, multi-site model to improve operational efficiency while offering our clients greater flexibility and accelerated project timelines to help them to bring their life-changing therapies to the market as quickly as possible. As part of the program of 21 OXP work streams, I'm very pleased to confirm that we have now successfully transferred our lentiviral vector capabilities to our Bedford site near Boston in the US. And we are also beginning to transfer our lentivector platform technology to France. Since the beginning of the year, I have been delighted with the commercial momentum we have seen. We have continued to experience very strong demand for our CDMO services and seen a significant increase in the number of commercial opportunities. This is reflected in the quality of the programs we are working on and the number of late-stage programs in our portfolio. We have onboarded new clients across all major viral vector types, including, important to mention here, seven early-stage AAV programs in the U.S. And we are very pleased to now be supporting also late-stage activities for four clients preparing for commercial launch of their products. So compared to last year, we have many more later stage programs in our pipeline and we have started to make selective investment in new talent to support the delivery of these programs in 2025 and beyond. So our pipeline has clearly become more mature, as Sébastien will show in a few minutes. This isn't just good for us. It's also a sign that the wholesale and gene therapy sector is maturing, and we are seeing real progress in bringing these therapies to the market. There have already been four FDA approvals for cell and gene therapy this year, with three more expected before the end of the year. This commercial momentum is really encouraging and has helped us to develop a more balanced and mature pipeline. In the first half of the year, we achieved organic growth of 38% compared to the same period last year, providing clear evidence that the strategy that we have put in place is working. This strong revenue growth has been achieved on a reduced cost base, allowing to reiterate the mid-term guidance we set first out at the same time last year. Lucie will elaborate on this later in her presentation, but I will now hand over to you Sébastien to provide us with a commercial update.

Thank you Franck. Good afternoon, good morning everyone. Let me start with the market situation. We all know that the macroeconomic environment is not very positive these days. But even in a difficult situation, we see that the number of programs in the various clinical phases that you see here on the left is still growing. Five percent more than in Q3 2023, with an overall number of clinical molecules that has progressed nicely into the latest phase, meaning phase three and commercial, confirmed by the number of FDA approvals that Frank just mentioned. Last year, we had seen seven approvals, two more than in 2022. This year, again, although the environment is difficult, we expect the same number of approvals. This maturation of the markets and the increasing number of approved programs is very important for us because it's a source of recurrent commercial manufacturing revenue, which we see in our pipeline, and I will elaborate a bit more on that in the next slides. But starting overall with the pipeline compared to when I joined the company at the end of 2022, where we had a pipeline that was shy of $300 million, we're today above $560 million, corresponding to a 94% growth of the pipeline of opportunities across all phases. You see here that the growth was quite similar comparing 22 to 23 and 23 to today, meaning that we expect at the end of the year to be above the number you see here. More important than just the growth of the pipeline, If you look at the right side of the slide here, you will see that about 57% of our opportunities are covering feasibility studies, preclinical phase 1 and phase 2, versus 43% in phase 3 in commercial manufacturing. That's the reason why I was talking about recurrent manufacturing revenue. Because the recurrent manufacturing starts in phase 2, at the very end of phase 2, and becomes routine and can be predicted through a long-term forecast when we reach the phase three and the commercial steps. It's actually what we see in terms of maturity through here on the left side of the slide, the risk adjusted pipeline value. So you've seen the pipeline before, $565 million. You see here the pipeline adjusted with the probability of success of the ongoing negotiation, including the probability of success through the various clinical phases as well. And when the pipeline grew by 94%, you see that the risk-adjusted pipeline grew even more at 99% compared to the end of 2022. The pipeline is healthy, well-balanced between the various types of clients, always using the same terminology here with the emerging biotechs, the established biotech and the big pharma. About a year ago, I mentioned that one of my objectives was to make sure that not only we would have the right split between the different types of clients, but also the right split between the existing clients and the new opportunities, which you see here in the middle of the slide. And you see that roughly 50-50 today is the split of the pipeline between existing clients and new opportunities coming from new accounts. One of the key objectives which led to the acquisition of the legacy ABL sites in Lyon and Strasbourg, one of the key objectives was also to diversify the pipeline in terms of geographical reach. We had a pipeline that was very heavy on the US side and very poor in Europe. We've moved the pipeline to slightly above 10% in Europe at the end of 2022 to above 30% today. That's the change that we were expecting. It's coming obviously from the ABL acquisition, where a number of opportunities had been identified by the ABL team, but also from the fact that now clients have identified that OXB is a real global player operating from the US, from the UK, and from continental Europe with the sites in Lyon and Strasbourg. Talking about the split between the phases, you see here, looking at the line, September 2024, that we've increased very significantly the number of projects in the two late phases, phase three and commercial agreement, moving from two projects in September 2022 to six projects in September 2024. That's the reason why we're extremely confident on the revenue generated through the second half of the year, but also for the revenues of 2025 since all these contracts are linked to projections going through 2025, but also visibility on 2026 and 2027. Obviously, when you're a biotech today investing to launch a product, meaning in phase three, you want to make sure that there is capacity for your future project and product in the UXB suites. And that's why we have a lot of visibility on what's going to happen through next year and the next two years as well. What's the benefit for our clients? I mean, the benefit from our track record, and that's the reason why we've been able to acquire more clients on the late stage. It's not only the maturation of the existing pipeline. It's also clients coming to us, asking for a tech transfer post-phase two to make sure that we're going to bring them successfully to the commercial stage. And taking their project at phase three is maximizing their chances of success. We have established technology. It's obviously one of the drivers why people come to us. And we keep saying that we're a quality and innovation-led CDMO. I think that's one of the reasons why we keep winning programs, including program at late stage. I'm going to stop here and hand over to Lucie.

Thank you, Sebastian. So firstly, it's great to see so many familiar faces in the room. I'm delighted to be here and to be presenting this update on OXB results. I've known the OXB business for a long time, and with this new clear-cut strategy and focus as a pure play CDMO alongside an incredibly experienced management team, this was an obvious opportunity for me to grasp. I believe this business has great potential and a very exciting growth trajectory, not least because of the ultimate benefit to patients from the therapeutic modalities our viral vector technology platform serves. Just a few words on me. As you may know, my last role was as CFO of Morphosis, which was recently acquired by Novartis. Prior to that, I was CFO at Autoless Therapeutics, a NASDAQ-listed CAR-T business, and I have a background in both sell-side and buy-side roles, where I will know many of you from. I'm obviously only three weeks in, so it's very early days for me, but I can tell you I have been incredibly impressed with the high energy of the team and my fantastic colleagues on the senior leadership team. So next slide, please. So as you all know, I joined the business just three weeks ago. Whilst these results relate to the period before I joined, I'm happy to report that there was strong growth in top line. Positive results seen from the cost streamlining exercise, which the team executed last year, as well as positive indicators for the future. Let's start with revenue. We saw an 18% increase in our first half 2024 revenues to £50.8 million, compared with £43.1 million in the same period last year. Importantly, when you look at organic revenue growth, which excludes the impact of the acquisition of OXB France and the loss of revenues from homology, our revenues grew 38%. And I think this is an important metric to measure the company's revenue performance by. Looking towards the future, our KPIs continue to give us confidence. Our revenue backlog figure at the 31st of August 2024 stood at approximately £120 million. This metric measures the amount of future revenue yet to be earned and therefore recognised on our existing orders, sort of like our open order book. As contracted orders are signed, this figure correspondingly increases and as revenues are ultimately recognised, it decreases. On orders, our contracted value of orders from clients currently stands at approximately £115 million. This has seen an increase since the £94 million of orders that we had signed at the end of August 2024. These KPIs and the commercial momentum we are seeing, which you will have heard from Sebastian, are strong indicators of our ability to continue a favourable revenue growth trajectory. In terms of cash, we had 81.4 million pounds in the bank at the 30th of June. This compared with 103.7 million pounds at the 31st of December 2023. Net cash stood at 41.7 million pounds at the end of June, which obviously takes into account the 39.7 million pounds of loans, which are primarily related to the loan facility we have with Oak Tree. Lastly, with respect to our cost base, we are seeing the benefits of the 2023 reorganisation. We reported an operating EBITDA loss of £20.3 million compared with £33.7 million in the first half of last year, and an operating loss of £32.2 million compared with £50.7 million in the first half of 2023. Next, I will discuss our financial guidance. In a nutshell, our guidance remains consistent with the trading update communicated a few weeks ago. We have reiterated both our existing near term and medium term financial guidance communicated to the market. To recap, we expect full year 2024 total revenues to be between £126 million and £134 million, with a three-year revenue CAGR of more than 35% for the years 2023 to 2026. This is based on the approximately £90 million of revenue we had for the full year 2023. On the near term, we expect a low double-digit operating EBITDA loss in 2024, which includes the impact of the acquisition of OXB France and investment in talent to support an increased level of late-stage client activity in 2025. On EBITDA, we expect to be profitable on an EBITDA level in 2025. In 2026, we expect to achieve operating EBITDA margins in excess of 20%. Supporting our guidance, we see positive indicators on RXB's growth objectives. As Sebastian has mentioned earlier, our total potential revenue pipeline stands at $565 million, up 29% from $438 million at the start of the year. This, as well as the risk-adjusted pipeline, which Sebastian also presented to you, certainly underpins the momentum we continue to expect in new revenue opportunity. And as I previously mentioned, year-to-date, our contracted value of order stands at around £115 million, which also supports this momentum. Another important indicator we look at is the maturity of our client portfolio, and it has been encouraging to see a high level of more advanced late-stage programmes. These are potentially higher-value programmes, and it is promising to see the development of these programmes and clients entrusting OXB with their late-stage assets, which I think speaks to the credibility of the team in the viral vector CDMO space. On the cost side, we will continue to exercise prudence in terms of our cost base as we work to build a sustainable and profitable business. All in all, I feel very encouraged by the positioning of OXB in this growth market and I'm incredibly excited to be part of the team. So with that, thank you. I very much look forward to working with you all. And I'll now pass to Frank.