Adaptive Biotechnologies Corporation

Ladies and gentlemen, thank you for standing by, and welcome to Adaptive Biotechnologies' third quarter 2020 conference call. At this time, all participants are in the listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Ms. Karina Calcidea. Thank you. Please go ahead, ma'am.

Thank you, Buena, and good afternoon, everyone. I would like to welcome you to Adaptive Biotechnology Third Quarter 2020 Earnings Conference Call. Earlier today, we issued a press release reporting adaptive financial results for the third quarter of 2020. The press release is available at adaptivebiotechnologies.com. We are conducting a last webcast of this call and will be referencing to a slide presentation that have been posted to the investor section in our corporate website. During the call, management will make projections and other forward-looking statements within the meaning of federal security laws regarding future events and the future financial performance of the company. These statements reflect management's current perspective of the business as of today. Actual results may differ materially from today's forward-looking statements depending on a number of factors which are set forth in our public financial statements with the FTC and in the 10Q filed today. In addition, non-GAAP financial measures will be discussed during this call, and a reconciliation from non-GAAP to GAAP metrics can be found in our earnings release. Joining the call today are Chad Robbins, our CEO and co-founder, Julia Rubinson, our president, and Chad Cohen, our chief financial officer. In addition, Harlan Robbins, adaptive chief scientific officer and co-founder, will be available for Q&A. With that, I will throw the call to Chad Robbins. Chad?

Thanks, Karina. Good afternoon, everybody, and thank you for joining us on our third quarter 2020 earnings call. Once again, I want to thank all of our adaptive employees for their unwavering dedication and flexibility over the past several months. During the quarter, our financial performance was solid, and we made substantial advances across all business areas. These results continue to validate the value of our immune medicine platform as a clinical product development engine. On slide three, let me walk you through some of the key highlights for the quarter. We reported revenues of $26.3 million, representing 25% growth versus prior quarter and 1% growth versus prior year. Related to our research business, we are working with two top-tier vaccine developers to use ImmunoSeq TMAP COVID in a subset of patients from their late-stage trials. This is encouraging as we strongly believe that measuring the T-cell immune response of vaccines is necessary to understand durability of the immune response. In clinical diagnostics, ClonoSeq test volumes grew sequentially 28%, and we also launched ClonoSeq for patients with CLL. For our diagnostic pipeline product, formerly known as ImmunoSeq DX, We are pleased to announce the new brand name is T-Detect, representing the power of T cells to detect disease. Today, we released top line results showing that T-Detect outperforms serology to confirm past infection, which further supports the upcoming launch of T-Detect COVID. In addition, we have also identified a clinical signal for Crohn's disease, demonstrating a consistent cadence in our R&D pipeline. And last but not least, in our drug discovery business, we are extremely encouraged that we have successfully identified two highly potent neutralizing antibodies against SARS-CoV-2, which we believe to be best in class. Our neutralizing antibody work is another proof point of the potential of our immune medicine platform shown here in slide four, to be a clinical product development engine. We have unique and proprietary capabilities to understand the genetics of the immune response to disease and translate that data into multiple opportunities across research, diagnostics, and drug discovery. Remember, the adaptive immune system sees most diseases in exactly the same way, including COVID. Once we characterized the immune receptor data specific to the virus, we were able to develop tDetect COVID as a clinical diagnostic test, offer ImmunoCityMap COVID as a research tool for vaccine developers, and identify potent neutralizing antibodies for a partner to potentially commercialize. Importantly, the infrastructure that we built in just seven months for COVID is being leveraged to accelerate similar commercial opportunities in multiple disease states. Before I pass it on to Julie, I want to share two exciting data announcements related to our COVID efforts. On slide five, as we announced today, we have new data further demonstrating that T-cell-based testing with T-DETECT outperforms antibody serology to confirm past SARS-CoV-2 infection. This data, from a study performed in collaboration with the University of Padua in Italy, shows that adaptive T-Detect COVID identified 97% of PCR-confirmed past infections, while serology identified only 77%. This follows on the heels of our publication earlier this fall showing superior sensitivity of T-Detect versus two leading serology tests in a real-world population from our immune race study. Together with Microsoft, and in parallel with other publications from around the world, we are contributing to the growing recognition of the importance of T cells to understand the complete picture of the immune response to any disease. This is the foundational thesis for T-DETECT. Now, on slide six, I will walk you through our neutralizing antibody findings. As you know, back in April, we deployed our platform to discover fully human neutralizing antibodies to treat COVID-19. As such, we used our high-throughput method of screening immune cells to find the best antibody or antibodies which neutralized the virus. We started with blood from over 300 patients and hundreds of thousands of antibodies, of which we synthesized and characterized over 1,600 antibodies to various parts of the virus. We identified two candidates that neutralized live virus at 13 and 16 picomolar, which means that a very small amount of each of these antibodies is able to block the virus from infecting cells. Also, these antibodies are synergistic, and we expect a cocktail to further enhance performance. To put this into context, antibodies and antibody cocktails currently in the clinic have reported higher picomolar concentration for the same amount of neutralization. While others in the industry have made progress in proving the clinical effect of neutralizing antibodies against COVID-19, there is certainly room for improvement in efficacy and questions around manufacturing and administration of therapy at scale. While, of course, we are excited about all the progress recently announced in the fight against COVID, we also recognize that the virus is now endemic and effective therapies are still needed. We hope that the antibodies that Adaptive discovered could contribute to this solution. And with that, I'll hand it over to Julie.