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spk01: Good day, and thank you for standing by. Welcome to ACOIA Biosciences' second quarter 2021 earnings conference call. At this time, all participants are in a 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, David Deichler.
spk03: Good afternoon, everyone. Thank you for participating in today's conference call.
spk08: On the call from ACOIA, we have Brian McGilligan, Chief Executive Officer, and Joe Driscoll, Chief Financial Officer. Earlier today, ACOIA released financial results for the second quarter ended June 30th, 2021. A copy of the press release is available on the company's website. Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements within the meaning of the federal securities laws, which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation and Reform Act of 1995. Any statements contained in this call that relate to expectations or predictions of future events, results, or performance are forward-looking statements. Actual results may differ materially from those expressed or implied in the forward-looking statements due to a variety of factors. For a list and description of the risks and uncertainties associated with the COIA's business, please refer to the risk factor section of our Form S-1 filed with the Securities and Exchange Commission on April 15, 2021. We urge you to consider these factors, and you should be aware that these statements should be considered estimates only and are not a guarantee of future performance. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, August 10, 2021. ACOIA disclaims any intention or obligation except as required by law to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. And with that, I'll turn the call over to Brian.
spk04: Thank you, David, and good afternoon, everyone, and thank you for joining Akoya's second quarter earnings call. Joe and I will start with prepared marks and then we'll take questions. I'm very excited to discuss our second quarter 2021 performance with you this morning. This marks our second time reporting results as a public company following the IPO in April. During the quarter, we continue to deliver on our plan to be the spatial biology company and work towards our mission of delivering a revolutionary class of new spatially-derived biomarkers, empowering life sciences researchers to better understand disease and helping clinicians improve patient outcomes. We're pleased to report strong second-quarter financial results with reported total revenue of $13.1 million, representing growth of 53% compared to the second quarter of 2020. This is ahead of our expectations of at least 45% growth provided on the last call. We had a strong quarter of reagent revenue indicating our customers are back to work and using the ACOIA platforms in a significant way. Joe will review our financial performance in detail shortly. As we discussed in the prior call, spatial biology solutions enable researchers to map the distribution of cell types, and biomarkers across whole tissue samples at single-cell resolution. While established technologies like next-generation sequencing, single-cell analysis, and flow cytometry destroy the tissue sample while analyzing it, ACOIA's spatial biology platform keeps the tissue sample intact, preserving the underlying tissue structure and enabling the detection and measurement of cells and biomarkers within their tissue context. The output is a detailed, computable map of the tissue sample, enabling much deeper understanding of the underlying biology, cellular dynamics, and interactions between key biomarkers. Spatial biology is the next evolution in tissue analysis and is happening today across more than 600 ACOIA instruments already installed at leading academic institutions, biopharmaceutical companies, and contract research organizations. ACOIA has the largest install base of any spatial biology platforms in the industry. This is a true competitive advantage and one that we intend to fully leverage. Most new technologies in the life sciences market begin in the discovery market with the goal of eventually making their way to the clinic to truly impact patient care. What's unique and powerful about the spatial biology market and ACOIA's Codex and Phenoptix platform specifically is that we are today simultaneously impacting science across this entire continuum. from discovery to translational and clinical research. Priced at under $100,000 and able to integrate with our customers' existing microscopes, our Codex platform is the industry's most cost-effective and complete spatial biology platform for the discovery market. It is an end-to-end automated solution that makes ultra-high multiplexing spatial biology accessible to all researchers. Our Phenoptix platform is designed to sit downstream of Codex serving the translational and clinical research markets where sample throughput requirements are an order of magnitude higher. For example, our Phenoptix customers using this platform for clinical trial studies are routinely performing spatial analysis on 30 or more samples per day. Phenoptix stands alone in the marketplace delivering unparalleled throughput and is a fully automated and complete end-to-end spatial biology solution. With Codex and Phenoptix, Akoi is uniquely positioned to capture the full market opportunity for spatial biology to revolutionize not just discovery, but also clinical and translational research and ultimately patient care. We are encouraged by the continued commercial success of our established on-market solutions, rapidly growing install base, strong financial performance, and accelerating publication rate. Following the IPO and as discussed on the prior call, we're making investments to build on and maintain our leadership position in the spatial biology market. These investments include the ongoing and rapid expansion of our commercial organization and expanded investment in research and development. In the near future, Okoye will deliver new and improved spatial biology solutions, including significant workflow improvements for our new and existing customers. These new products and capabilities will be enabled by leveraging our full technology suites across Codex and Phenoptix, by internally developing new groundbreaking spatial biology solutions, and by partnering with industry and academic thought leaders. Our R&D team's focus is on delivering expanded multiplexing and throughput, new applications for single-cell whole slide analysis, and the continued advancement of our data analysis and visualization solutions. The result will be a powerful continuum of products that drive expanded market access increased system placements, and growing platform utilization and reagent pull-through. In the coming months, we'll begin to highlight some of these advancements, so please stay tuned. To continue to advance Codex as the most accessible and powerful spatial biology platform on market, we recently announced partnerships with leading microscopy companies, including ZEISS, Nikon, Crest Optics, and Andor. These partnerships enable robust technical integration between Codex, and our partners' microscopes. It also enables ongoing workflow improvements, application expansion, and co-promotional activities to drive further adoption of Codex. These partners are also important enablers of a recently announced imaging innovators network. It's called the I2 Network. With the I2 Network, Okoye is partnering with academic thought leaders to drive innovation and application to development on Codex. keeping us on the leading edge of new spatial biology solutions. So let's now pivot to our translational and clinical research efforts. As we discussed, Phenoptix is the only spatial biology platform capable of meeting the high standards of translational and clinical research studies on the path to true clinical use. Now, this is particularly true when considering the requirements to support clinical trials. These core requirements include the following. First, a platform must be high throughput and automated. capable of analyzing 20 to 50 samples per day. Second, the platform must have fully demonstrated reproducibility and robustness. And third, the platform must deliver single-cell resolution across the entire slide. Single-cell whole slider resolution across the entire tissue is fundamental. Phenoptix is the only platform on the market that can meet these throughput, robustness, and sample resolution requirements. A seminal publication released last month last month in the Journal for Immunotherapy of Cancer, highlights that our Phenoptics platform meets these high performance standards. Called the MITRE study, this publication was the result of a partnership with Johns Hopkins University, Yale, Burleigh Charles Research Institute, MD Anderson, and Bristol Myers Squibb. It concluded that the Phenoptics platform delivers the throughput and analytical robustness needed for clinical trial and eventual clinical use. This publication is central and among an accelerating body of peer review publications that are evidence of our growing success in the translational and clinical markets. In Q2, we also announced the launch of our Advanced Biopharma Solutions Service Lab out of our Marlboro facility. This team is focused on serving our growing clinical trial partnerships with leading biopharmaceutical companies. We are working closely with biopharma companies to implement phenoptics in their clinical trials to help them better understand and predict response to their novel therapies. Our recently announced partnership with AstraZeneca is a signature example of the value that phenoptics and the Advanced Spiropharma Solutions Group delivers. AstraZeneca's Immuno-Oncology Division has partnered with ACOIA to leverage the phenoptics platform and these services to discover predictive signatures of response to therapy to inform their clinical trial design. Because of the established throughput and robustness and resolution of Phenoptix, similar partnerships are ongoing with a number of other leading biopharma companies. A key driver of the continued success of Phenoptix is the discovery and publication of transformative spatial phenotyping signatures. A standout publication in the June 11 issue of Science featured powerful discoveries from the team at Johns Hopkins University as part of our partnership with their AstroPath initiative. AstroPath is a cutting-edge interdisciplinary partnership within Johns Hopkins between their astrophysics department and their cancer center with our phenoptics platform at the core. In this paper, the team at Johns Hopkins discovered a powerful biomarker signature to predict with a high degree of confidence response to immunotherapy in advanced melanoma patients. Together, we now aim to leverage this and future groundbreaking discoveries with the AstroPath team to provide even more powerful clinical trial solutions to our shared biopharmaceutical partners. In addition to the AstroPath publication, the accelerating rate of peer-reviewed publications on our platform continues. There were 109 peer-reviewed publications on our platform in 2020. This is a near fourfold increase over 2019. And now in the first half of 2021, there are already 138 publications, more than all of last year. That's nearly 250 publications in the last 18 months. Our customers are clearly uncovering high-valued scientific discoveries through their use of Accoy's platform. As we've outlined, we remain focused on driving revenue growth by investing in the business to expand our commercial infrastructure and accelerate research and development. As of June 30th, we have approximately 225 employees worldwide, a significant increase from the December 31st total of about 170. We are continuing our aggressive investment to add more talent in all parts of the business and are excited about the prospects ahead. We recently announced the appointment of Mr. Scott Mendel to our Board of Directors. Scott brings 25 years of experience as one of the most accomplished executives in the diagnostic industry and a proven track record of transforming innovative technologies into clinical testing solutions. We are confident that Scott will bring tremendous insights to Akoya as we continue to advance the company. In summary, we're pleased with our second quarter performance, achieving great progress across a range of important metrics, and we look forward to executing on our financial and strategic plans as we move forward through 2021 and beyond. I will now turn the call over to Joe to discuss our financial results. Joe?
spk05: Thanks, Brian. Hello, everyone. As Brian mentioned earlier, total revenue for the second quarter of 2021 was $13.1 million as compared to $8.6 million in the second quarter of 2020, which represents 53% growth. The prior year quarter was impacted by COVID-related disruptions at many of our customers. Product revenue was $10.7 million for the second quarter of 2021 compared to $6.2 million in the prior year quarter.
spk03: Services and other revenue totaled $2.4 million in the second quarter of 2021 as compared to $2.4 million in the prior year quarter.
spk05: Within product revenue, instrument revenue was $6.3 million in the second quarter of 2021 compared to $4.5 million in the prior year. Reagent revenue was $4.3 million in the second quarter of 2021 versus $1.5 million in the prior year. Increased reagent revenue was due to higher instrument count, return to work in labs, and greater pull-through per instrument than previously experienced. Our annualized pull-through on a year-to-date basis exceeds $30,000 per instrument for both Codex and Polaris. The Polaris pull-through is in line with our expectations. The Codex pull-through is significantly higher than our historical performance, which has been in the low $20,000 range. Reagent revenue is expected to be solid in the third quarter, but likely will be below the second quarter due to seasonality. We monitor instruments sold and the install base as key performance indicators for our business, which Brian discussed earlier. To reiterate, we had another strong quarter with 31 total instruments sold, highlighted by 18 Phenoptix installations, of which the majority are Polaris instruments. The total installed base is now 618 instruments as of June 30th, 2021. We did close several additional Codex units near the end of the quarter, which will ship in Q3. Additionally, there were some COVID-related disruptions in Japan, which resulted in several potential instrument purchases being pushed out of the second quarter. Gross profit was 8.1 million in the second quarter of 2021, compared to 5.3 million in the prior year. This resulted in gross profit margin of 62.2%, an increase from the 61.6% in the prior year period. The increase in gross margin was primarily driven by the positive mix of re-agent revenue in the quarter. Total operating expenses were $14.5 million in the second quarter of 2021 as compared to $9.1 million in the prior year quarter. In line with our strategic plan, the increase was part of our plan to significantly invest in the business following our IPO. We are aggressively hiring in all aspects of the business, including increasing our commercial spend to continue to drive market share growth. Looking forward, we project OpEx should be at least $16.5 million in the third quarter. Net loss for the second quarter of 2021 was $5.6 million compared to net loss of $4.6 million in the second quarter of 2020 due to the increased investment in operating expenses. Our year-to-date revenue is $25.3 million a 29% increase over the first six months of 2020. This puts us right on track to achieve our targets for fiscal 2021. We have $135.5 million of cash as of June 30, 2021. Common shares outstanding are $37.1 million as of June 30. As highlighted earlier, we remain confident in our ability to deliver strong growth in 2021 and are anticipating third quarter revenue growth of approximately 28 to 30 percent over the prior year quarter. We are refining our guidance for the full year 2021 from at least 52 million to between 52.5 million and 53 million. The second quarter results exceeded our guidance, and we are focused on delivering consistently strong results each quarter. Now I'll turn it back over to Brian.
spk04: Thank you, Joe. In summary, we remain excited about the impact of spatial biology on the discovery, translational, and clinical research markets and continue to see robust adoption of our Codex and Phenoptix platforms. We're pleased to report strong results in our second quarter as a public company. We are thankful for the hard work of our fellow dedicated Aquarians and for the support of our customers and shareholders. Okoye remains well-positioned for growth, and we're excited about the opportunities ahead. Now, at this point, we will open up the call for questions. Operator?
spk01: Thank you. And as a reminder, to ask a question, simply press star 1 on your telephone. To withdraw your question, press the pound or hash key. Again, if you have a question, simply press star 1. One moment while we compile the Q&A roster. Our first question is from Teja Savant with Morgan Stanley.
spk07: Hey, guys. Thanks for taking the questions. This is Edmond on for Teja. Just to start off, I wanted a clarification. The quarter-over-quarter step-down in instrument placements was driven by the COVID headwinds that were seen in Japan. Is that correct?
spk05: You're talking about versus Q1 you're talking about? Yes. Yes, so we closed a couple of additional Codex units right near the end of the quarter that are going to ship in Q3, and then there were several more units basically in Japan that got pushed out of Q2 due to COVID-related issues.
spk07: Got it. So I guess on that note, aside from Japan over the last couple of weeks, have you seen any pockets of weakness develop in certain regions as the resurgence of COVID starts looming? What do you see in terms of, like, instruments?
spk04: Yeah, I appreciate the questions.
spk07: Oops, sorry. Go ahead. No, it's okay. I was just asking what you're seeing in terms of ordering trends for instruments and reagents.
spk04: Yeah, it's pretty dynamic, as you've likely heard. You know, the ongoing challenges in Asia Pacific continue. Customer access in areas like UK has been an ongoing problem. And in the U.S., again, it's pretty dynamic in terms of the access to customers. You know, at this point, though, as we look forward, we're still confident that the opportunities on the instruments and reagent side are in line with our expectations. But it is pretty volatile.
spk07: Got it. That's very helpful. And then turning to your I-squared network, on your ZEISS collaboration, can you provide any incremental updates there? I'm assuming there's not much you can say in terms of the technical product side, but in terms of mapping out the co-marketing agreement, have you guys made any progress? And then for the three new collaborations that were mentioned, would they be similar types of collaborations or deal agreements?
spk04: Yeah, maybe in reverse order. All four arrangements are structurally similar where the benefits really are ensuring tight technical integration just to continue to streamline the user experience and adopt new workflows, increase acquisition speed, drive for deeper resolution. So structurally they're the same both technically and the co-marketing side. I would say to your first question, the co-marketing activities are really just beginning to – to be put in place now. So nothing more detailed to offer on ZEISS or any of the other three specifically at this point.
spk07: Got it. And then one final one from me. In terms of launching your advanced biopharma solutions as a rollout of your strategic clinical research program initiative, can you remind us if you've highlighted any other projects that might be coming up in this clinical research program initiative?
spk04: So we announced the Advanced Biopharma Solutions Group, to reiterate, as part of our partnership with Key Biopharma, like AstraZeneca, to work in the clinical trial space. In terms of partnerships, similar partnership with UCSF, UC San Francisco, working on their iSpy2 trial, which is focused on breast cancer. That's another partnership within the Phenoptix portfolio that we announced. on top of the publications that we talked about in the opening remarks. Got it.
spk07: Thank you very much for your time.
spk01: Our next question comes from Steven Ma with Piper Sandler.
spk06: Hi, guys. Congratulations, and thanks for taking the questions. Sure.
spk04: Thanks, Steven.
spk06: Yeah, so maybe just to stay on the advanced biopharma solutions, I know the Marlboro Lab is undergoing CLIA certification to help out your partners do clinical trial patient stratification. Can we get an update on that timing? And should we expect once you guys get CLIA Lab certification, that's going to accelerate the signing on of new partners?
spk04: Yeah, so the timing, there's a little bit of reliance on the regulatory bodies giving us the final stamp. So we expect it to likely be within this quarter. And that's, I think, similar to what we have discussed before. And to your question about kind of the ABS business flow, yes, to answer your question, yes. With that CLIA certification, that opens up additional business with existing and new partners for example, to contemplate the use of our services for actual enrollment studies.
spk06: Okay, great. That's helpful, caller. And then I had a question on the publication side. So can you give us a sense of, you know, what proportion of those 135 new publications were were for translational clinical studies versus maybe like discovery work?
spk04: Yeah, that's a good question. I would say that the majority of those are on the Phenoptix portfolio. Of the 135, you know, I would guess the overwhelming majority is Phenoptix just because of its longer standing in the market since the launch of Phenoptix 2.0 at the end of 2018. And with Codex coming out, throughout 2019, those are starting to roll in. And within the phenomics portfolio, the overwhelming majority of those are really translational studies, like we talked about earlier on the Astropath Science publication. That said, some of these publications are really foundational in establishing analytical robustness. Now, one could argue that those are translational, but those are really the predicate platform requirements that you need to establish the robustness, as we talked about earlier, for a clinical study. So some of them are translational, and even within some of those, they're really about platform assessments, like the MITRE study we talked about, Stephen.
spk06: Yep. Yeah, that's helpful. And yeah, maybe just, you know, yeah, I mean, yeah, I appreciate that. Yeah, a lot of the publications were phenoptics and translational. How do you square that away with the Codex pull-through being higher than phenoptics in the quarter?
spk04: But it's just, well, the publications usually take like a year and a half to come out. So Codex kind of launching throughout 2019, you know, the wet blanket for COVID-2020. We're starting to see a lot more Codex publications. It's probably, I'm going to say, up to 135, and this is a complete estimate. It's probably 20 or so are on the Codex front. And the pull-through is happening, I think, just because people are really starting to get value and accelerate their use of the platform. We just didn't have a lot of visibility even of the pull-through throughout 2020 just because it was such a unique year. I don't know, Joe, if you want to add any color to that.
spk05: Yeah, I think Codex is really just starting to hit its stride now. So we launched it in 2019. People were getting used to using it in 2019. Then 2020 came, and, you know, that was kind of a strange year. And I think people are now back in their labs and really seeing the value of the Codex instrument. So I think it's really just starting to hit its stride right now.
spk06: Okay. No, that's great color. And then, Joe, maybe a question for you and also Brian. As you guys say, you're going to continue to invest in the business, aggressively hiring on the sales and marketing side. Do you see any higher spend in any specific geographies or is it sort of balanced across the globe? Thank you.
spk04: Yeah, I think generally it's balanced. I think we're having an opportunity to get some really stellar talent just because of how far we advance. I think we're just more broadly recognized, but I don't think there's any surprises in terms of the cost basis, but Joe, I'll let you add color.
spk05: Yeah, you know, we're adding commercial people throughout the world. So, you know, that's happening in every geography right now. We would be adding more people in the U.S. just because of areas like research and development and, you know, some areas that are just purely U.S.-based functions. But on the commercial side, we're adding people. sales and marketing talent all over the world.
spk06: Okay, great. Thank you.
spk01: Thank you. Our next question comes from Kyle Mixon with Canon Core Genuity.
spk09: Thanks. Hey, Brian and Joe, thanks for taking the questions. Congrats on a great quarter. I want to thank the guidance as well. Yeah, sure. So the fourth quarter implies 15% of your VR growth. which is below the street. I mean, the third quarter is above the street, but I was just wondering what level of conservatism or maybe tempered expectations that you're kind of baking in there. And then kind of jumping off of that and also piggybacking off a prior question, I was wondering if the third quarter instrument placements would be like abnormally higher just given the Japan delays, I guess, and some of the installations that fell out of 2Q as well. Thanks.
spk04: Yeah, and I think we're dealing with, Kyle, and I'll let Joe dig into the details. Obviously, what we're dealing with here in terms of the prior years, you know, quarterly growth of the prior years is kind of an awkward, like everybody is facing, an awkward predicate in the prior year. So I think that the percentage gross lumpiness will continue. Yeah, we do expect to be sort of in line with our expectations on instrument placements for Q3 and through the rest of the year, but Joe, I'll let you add a little bit more color.
spk05: Yeah, you know, I think Q3 is going to be a normal quarter. I don't think there's going to be a big pop, you know, from anything that carried over from Q2. So I think you're looking at, you know, probably, you know, a few more instruments being placed in Q3 than in Q2. And, you know, really just our guidance for the year, you know, we're trying to take a conservative posture right now. You know, really just want to kind of deliver quarter after quarter. And if If we have another solid Q3, we'll certainly take a look at updating our Q4 guidance. But right now, we're just trying to stay conservative, make sure we meet everyone's expectations. And like I said, we can easily update it after next quarter if things continue to trend in the right direction.
spk09: Okay. Yeah, I appreciate that, guys. Thank you for that. I was also wondering about the competitive landscape. Obviously, a competitor with a spatial transfer performance platform launching an assay with FFP capability recently. Obviously, there is differences between end lights and multi-cell, single-cell, host live, et cetera. I'm just wondering if you notice any change in the landscape with the entrant of that product. And if you think it's too early, like what type of impact do you think it could have over time or a BNC2 platform, I guess? And honestly, in any event, I mean, are you going to accelerate any product development on your end just based off what's happening in this space?
spk04: Yeah, I think the way we look at the competitive environment is that this market is still rapidly growing. And most of the system placements are really greenfield placements and not necessarily head-to-head. And I think what's unique about a lot of the spatial transcriptomic solutions that are coming out is they do have a high degree of complementarity to what we're doing on the Codex side. You know, there's a recent webinar that we did I'm doing some of these multi-element comparisons and extracting a lot of value out of it. So, you know, I think you're going to see a lot of customers, you know, leverage platforms like that and ours to move their science forward. And as we look forward to the future, we'll look at, you know, our capabilities, as I alluded to earlier, to expand our application suite as well. Okay.
spk09: Thanks for that. And then just turning to the iSquared network, I don't know if you disclosed this, but how many partners have joined so far? And... I guess any novel applications that have come out of that yet? And then also, how is the utilization kind of trending, I guess? Or just how is the acceleration kind of ramping up?
spk04: So I didn't hear the second part of your question, but the first part is we have not yet talked about the specific members and the number of memberships we have in those yet. We'll probably be talking about who those partners are and what their application focus is going to be in the coming quarters. And what was the second part of your question, Kyle?
spk09: No, I think Brian, that kind of answers that. I think I'm good. That kind of answers both sides of the question, so that's good. There's one last question on the AstraZeneca partnership around phenoptics. I just was wondering if you could kind of tell us what lies ahead in that collaboration, any like timelines or important milestones. And in the context of the broader work with biopharma, how meaningful could that be for efforts to really align with drug development in the future?
spk04: Yeah, so no specifics on AstraZeneca. that I can reveal. Obviously, a lot of that's confidential in terms of the underlying details. But what's important, not just with our partnership with them, but with other large biopharma partners, that these are multi-project partnerships. And so, I think you're correct. As we look forward, we're investing more and more in the Advanced Biopharma Solutions Group because it is a really important vehicle. to really embed ourselves within the clinical trial of these, the clinical trial work of these key IO biopharma, immuno-oncology biopharma. And so that is a, that's an important avenue for us, the ABS group, to leverage as part of these partnerships.
spk09: Okay, great. Thanks a lot for taking the questions. Congrats again. Thanks.
spk01: Thanks. Our next question is from Julia UK with JP Morgan.
spk02: Hi, good afternoon. Maybe just following up on the consumable strength this quarter, I guess, are there any timing factors or big partner projects such as I2 that really contributed to strength? And as we think about the second half, how should we think about the policy we're going forward, and what are the chances that we can see consumable revenue above what you're guiding to?
spk04: There was no single event that drove the consumables. I think it was generally a lot of unlocked demand for people that didn't have the ability to get in the lab and do a lot of work. I think that was one of the big drivers. We sort of have a standard seasonality. that you see, particularly on the consumable side, that goes sort of Q4, Q2, Q3, Q1 in descending order. So that's the general seasonality that one sees with the consumables, and I suspect that that's going to continue. But that said, year over year, we're seeing pretty profound growth in aggregate year to date.
spk02: Got it. And as we think about kind of, you know, the clinical trial piece of your business, obviously it's great to see that you now have KOL validation of the clinical trial readiness of the platform. How will you monetize this part of the business? Is it mostly through instrument placement or through your own AVS service? Or perhaps does the answer depend on the time horizon? Just help us think through that a little bit.
spk04: Yeah, so the way we monetize that is really through both. is through both. So, you know, again, we'll use AstraZeneca because that's the one that's publicly disclosed. They have a number of systems internally as well that they've bought over the last, you know, couple years. So what we see is really both the acquisitions of the Phenoptix platform by our BioPharma customers, by CROs, who is an important customer base of us, as well as growing business through our ABS services. So it's really both. And then what also happens is these projects are generally larger in size, so it does help drive our consumables as well.
spk02: Got it. And so how should we think about really the revenue contribution starting the second half of this year and how it ramps from there and how much benefit from the CLEAR certification is already embedded in your current guidance?
spk04: Yeah, I mean, I think most of what we've talked about today as part of our efforts in the translational and clinical research effort. This has been part of our 2022 plan. So I think we have a lot of this already contemplated in the model with both the work out of ABS and the growing system placements in biopharma and CROs.
spk01: Okay, thank you. Thank you. And this concludes our Q&A. I would like to turn the call back to Brian McAlligan for his Final remarks?
spk04: Well, just a thank you to everyone for participating today. We really do appreciate your time and look forward to following up again soon. So thank you all.
spk01: And thank you for your participation in today's conference. You may now disconnect. Have a wonderful day.
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