Bionano Genomics, Inc.

Good day, and welcome to the BioNano Genomics Fourth Quarter and Full Year 2021 Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Amy Conrad from Investor Relations. Please go ahead.

Thank you, Gigi, and good afternoon, everyone. Welcome to the BioNano Genomics Fourth Quarter and Full Year 2021 Financial Results Conference Call. Leading the call today is Dr. Eric Holmland, CEO of Bionano. He is joined by Chris Stewart, CFO of Bionano, and Rich Shippey, CBO and head of global sales of Bionano. After market closed today, Bionano issued a press release announcing its financial results for the fourth quarter and full year 2021. A copy of the release can be found on the investor relations page of the company's website. I would like to remind everyone that certain statements made during this conference call are forward-looking and including statements about bionanostrategic and commercialization plans, sales pipeline, anticipated benefits or improvements to the SAFIRE system, goals and anticipated milestones for 2022, the advantages of the SAFIRE system over current technologies, the anticipated benefits of recent acquisitions, expectations regarding timing and content of study results, and anticipated benefits of these studies in driving adoption of the SAFIRE system. Such forward-looking statements are based upon current expectations, and there can be no assurances that the results contemplated in these statements will be realized. Actual results may differ materially from such statements due to a number of factors and risks, some of which are identified in BioNano's press release and BioNano's reports filed with the SEC. These forward-looking statements are based on information available to BioNano today, and the company assumes no obligation to update statements as circumstances change. In addition, To supplement Bionano's financial results reported in accordance with U.S. generally accepted accounting principles, or GAAP, the company is reporting non-GAAP operating expense. This non-GAAP financial measure is not meant to be considered in isolation or as a substitute for comparable GAAP measures. It should be read in conjunction with the company's consolidated financial statements prepared in accordance with GAAP, has no standardized meaning prescribed by GAAP, and is not prepared under any comprehensive set of accounting rules or principles. A description of non-GAAP operating expense and reconciliation of non-GAAP operating expense to GAAP operating are included at the end of the company's earnings release issued earlier today, which has been posted on the IR page of the company's website. An audio recording and webcast replay for today's conference call will also be available online in the investors section of the company's website. With that, I will turn the call over to Eric.

Thank you, Amy, and good afternoon, everyone, and thanks for joining us today. I want to start out by saying that 2021 was simply a spectacular year for BioNano. Commercially, the results were very strong. We grew the installed base of our Sapphire systems in the world to 164, which represents 69% growth over the installed base on December 31, 2020, and exceeded our goal of 150 by nearly 10%, with optical genome mapping being adopted at several notable cytogenetics laboratories and academic medical centers in the United States, across Europe, Australia, China, Taiwan, and Japan. We also sold 3,204 flow cells during the fourth quarter of 2021, which represents 29% growth over the same period in 2020, and brings the total for 2021 to 12,500 flow cells sold, and that represents 96% growth over the 6,311 flow cells sold in 2020. Now, please remember that the flow cell is the unit consumable in our nanochannel arrays for analyzing one human genome. The more of these flow cells that are purchased in the market indicate more utilization in the field, which in turn leads to more data, more publications, more presentations, and we believe more demand for optical genome mapping. So, this is outstanding progress. And our revenues in the fourth quarter of 2021 were 6.3 million, which is up 58 percent versus the same period in 2020. And revenues for the full year 2021 were 18 million, which represents 111 percent growth compared to 2020. Now, in clinical development and bio-nano laboratories, we also made tremendous progress. The sites conducting our postnatal study published their interim technical performance readout of the study, and the data gave an incredibly positive view of the utility and robustness of optical genome mapping across these sites. The interim results showed that optical genome mapping is consistently performing as well or better than traditional methods used in cytogenetics and for the analysis of chromosomal aberrations and structural variations. The data also showed that optical genome mapping can be performed reliably, reproducibly across multiple sites, multiple sample types, and multiple different operators. Enrollment for our postnatal study reached 113 subjects, while enrollment in the prenatal study received IRB approval and reached 132 subjects. 2022 will be a significant year for progress in these studies, and I'll say more about that when I cover the 2022 strategy and goal. Now, SAFIRE sites in Europe reported receiving accreditation for their OGM workflows beginning in Q2 2021. And these accreditations unlock the potential for menu expansion and reimbursement. While in the U.S. during 2021, several sites validated OGM in laboratory-developed tests, and they submitted applications for reimbursement codes, including Z codes and proprietary laboratory analysis or PLA codes. These codes are what enable them to get paid for the OGM tests that they performed. And in our own BioNano laboratories, during the fourth quarter of 2021, we analyzed 341 samples, and you can compare that to 117 samples that were analyzed in the same quarter in 2020. The total number of samples analyzed in 2021 was 1,067 samples, and that compares to 694 for the year 2020. Now, we believe these services projects can provide critical proof of principle for newcomers to optical genome mapping as they evaluate it in their research with their own samples. The data provide them with the ammunition they need to convince their institutions to bring optical genome mapping And when we see growth in these services samples being processed, we view it as a good leading indicator of demand for optical genome mapping. In product development, we had tremendous progress as well. We released important assays in the third quarter for optical genome mapping with SAFIRE that enabled different applications, including ones for cultured amniocytes, and chorionic villi samples, which enable our prenatal studies and customer applications in that area, as well as other applications in prenatal analysis and product of conception analysis. We released version 6.1 of our NX clinical software in the fourth quarter, which was developed by Biodiscovery. Version 6.1 has expanded capabilities for analysis of next-generation sequencing in genetic disease and cancer, and supports novel assays in these disease areas. And importantly, in the fourth quarter, we completed the prototype of the next version of Optical Genome Mapper that we are working on. This new instrument is expected to enable optical genome mapping analysis at substantially higher throughputs than the SAFIRE system currently supports and should improve many aspects of the optical genome mapping workflow. And financially, we strengthened the balance sheet with equity financings in the first quarter of 2021, which were significant then, but given today's environment, they represent highly important steps in enabling the company's ability to continue growing and achieving these outstanding results. Lastly, I want to mention an important step we took in corporate development, which was the acquisition of Biodiscovery that we completed in October of 2021. And this move brings in their software products for visualization, interpretation, and reporting of sequencing and microarray data, as well as their team of world-class software engineers, including Dr. Sohail Shams, who was their founder and CEO and has become our chief informatics officer. Dr. Sham leads our genome informatics team, including software development and bioinformatics. And it's motivated by accelerating the importance of optical genome mapping as a unique and valuable tool for all sorts of genome analysis. We were looking to accelerate the development of our own software for this type of visualization, interpretation, and reporting, but focused on optical genome mapping data. And so acquiring Biodiscovery gave us the team and the platform into which we could incorporate optical genome mapping quickly. NX Clinical is industry leading for these applications in analyzing structural variation. And it gives us a tool that integrates optical genome mapping along side these commonly used data types in the industry. And so when we look back over the year as a whole, what we really conclude is that we exceeded the goals and expectations for all of our planned milestones across the whole year, but we also advanced the company across our strategy, products, and finances in ways that we really feel exceeded our plan overall. In fact, we view 2021 as being a complete transformation of BioNano from a life sciences instrumentation company where we began into a global genomics company that's focused now on elevating the health and wellness of all people with a suite of products and services that have the potential to transform the way the world sees the genome. So I'm very proud of 2021. the momentum that we've built there, but I'd like to turn the page on 2021 and begin focusing on 2022. We see 2022 as representing a key time of inflection for us. We want to elevate the company commercially. We want to improve the product and the services that we provide across the industry. And we want to change the way in which they're accepted In fact, we call the strategic roadmap for 2022 Elevate. And Elevate has five major strategic pillars. First and foremost, we want to continue the amazing progress that we've made in expanding our commercial traction and validation of optical genome. We want to delight our customers with our products. And something that we need to recognize about The level and size of our installed base is that robustness becomes incredibly critical, as well as the use of the products for industrial applications at scale. We want to clear the path for optical genome mapping reimbursement or market access across our target markets on a global basis. We want to continue advancing our products in a way that enables market expansion and penetration into new markets, and we want to make software a strategic driver of BioNano solutions. I've got some milestones to summarize for you in connection with 2022 and Elevate. Before doing that, though, I want to turn the call over to Chris Stewart, our CFO, for him to walk you through an overview of our financials. Chris? Thanks, Eric.