IsoPlexis Corporation

The conference will begin shortly. To raise your hand during Q&A, you can dial star one one. Good day and thank you for standing by. Welcome to the ISO Plexus third quarter 2022 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 one one on your telephone. You will then hear a message that your hand is raised. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Carrie Mandeville with investor relations. Please go ahead.

Thank you. Earlier today, ISO Plexus released financial results for the quarter ended September 30th, 2022. If you've not received this news release, or if you'd like to be added to the company's distribution list, please send an email to investors at isoplexis.com. Joining me today from IsoPlexus is Sean McKay, Chief Executive Officer, and John Straley, Chief Financial Officer. Before I begin, I'd like to remind you that management will make statements during this call that are forward-looking statements within the meaning of federal securities laws. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated. Additional information regarding these risks and uncertainties appears in the section entitled forward-looking statements in the press release ISO Plexus issued today. For a more complete list and description, please see the risk factors section of our annual report on Form 10-K, filed on March 30, 2022, and in our other filings with the Securities and Exchange Commission. Except as required by law, ISO Plexus disclaims any intention or obligation to update or revise any financial projections or forward-looking statements. whether because of new information, future events, or otherwise. This conference call contains time-sensitive information and is accurate only as of the live broadcast, November 10, 2022. With that, I'd like to turn the call over to Sean.

Thanks, Carrie. Good morning, and thank you, everyone, for joining us for our third quarter 2022 earnings call. On today's call, I will provide an update on some of the operational, commercial, and development progress we've made to lay the foundation to lead the single-cell and blood-based bulk proteomic space with a focus on achieving profitable, sustainable growth. Then I will turn the call over to John for a closer look at our financial results and outlook for the remainder of 2022. Revenue in the third quarter was four and a half million, up 7% from the prior year. We reduced operating expenses down 37% from the first quarter of this year, given our commitment to conserving cash. While difficult, our team proved resilient and responsive to increasing customer demand despite the challenging macro environment, specifically around difficult access in China and inflationary pressures in Europe. At the same time, IsoPlexus' IsoCode has established itself as a recognized authority in assessing proteomic cytokine signatures from single cells. Voice of customer and existing early access users are getting increasingly excited that IsoSpark will be able to offer both single cell IsoCode and the dynamic bulk serum Codeplex Q chips on the same system. Together, these solutions create critical value to our lab customers in an affordable lab system that saves the customer time, labor, and provides differentiated full-signature immune data. The two-in-one solution provides a dynamic duo unmatched on any other protein analysis system. We'll start today with expense control and cash conservation, since that's been a critical focus. While John will cover in greater depth, the team found a way to deliver growth At the same time as we reduced operating expenditure by 37% in the total workforce by 40% from Q1. This is testament to the resilience and hard work of the team and continued commitment to collaborating with our customers to find solutions. We appreciate all our team has done to make this happen. The shift also demonstrates our commitment to a path to generating positive EBITDA over the coming quarters. We still have further expenses to reduce to align with the realities in the capital markets environment, which will enable us to conserve cash at this critical time. Looking more closely at our customers during the third quarter, we sold 23 instruments, bringing our total units sold to 277 instruments, providing increased base for our recurring revenue consumable pull-through, as well as the service contracts associated with our systems, from which we saw an uptick in Q3. 35% of the units sold in Q3 and 25% of the total instrument purchases to date are from customers who have bought multiple instruments. We also now have instruments placed in 79% of comprehensive cancer centers in the United States. In our IsoCode products and in the early stages, our CodePlex products are building momentum and playing a key role in the translational medicine ecosystem. For the large swath of immunology researchers fighting cancer, Our ISO code helps eliminate a critical bias on the illicit and flow intracellular cytokine systems, namely the fact that they can only search for a limited or popular number of well-known cytokines, which may not be the critical one for quality immune response. This critical limitation has set back researchers for years, not only in finding potent cell therapies and antibody drugs, but also in creating potent vaccines against difficult targets. Isocode solves for this bias by providing the full cytokine signature for immune cell, detecting critical and unique aspects of what is termed in the field a quality immune response for the first time. Here we highlight some of our hardworking customers who are leveraging our full signature quality immune response with recent customer publications. Washington University in St. Louis highlights the importance of enhancing what is the long-term goal of every cell therapy, persistence, through the addition of a novel genetically engineered interleukin-7. In the journal Nature Communications, Isocode provided a quote-unquote quantitative marker of CAR-T functionality to confirm that the modified IL-7 induces robust cell expansion without compromising functional potency. The full signature on isocode uniquely reveals these critical aspects of cell therapy response. On the other end of the development spectrum, Lonza, leading contract manufacturer who press released a collaboration with IsoPlexus in 2021, highlights the impact of large immune signature polyfunctional T cells in functional cell behavior detected on our platform as a vital functional characteristic for allogeneic product development. and for manufacturing. This is published in Frontiers in Medical Technology. While our ISO code is recognized in the fast-growing cell therapy world as a critical solution, we view the translational cancer immunology market as key to our growth. We have placed multiple units in many of the top pharma focused on cancer immunology and have been featured in a variety of leading and large studies for checkpoint inhibitor therapeutics. yet our pharma customers have pointed to our increase in cell throughput and surface markers per cell is critical for further expansion. That product offering will be available in 2023, and our customers believe it to be an unlocking event for the next generation of isopode expansion in multi-cell type analysis of quote-unquote full signature quality immune response. This is critical to us proliferating with many units serving translational medicine at each of these pharmas. Our product development team is still on track to release CodePlex Q in Q1 of 2023, which will be a game changer for the value proposition for ISO Spark customers. We tested and verified the early access CodePlex with our customers, and the core value proposition of the product alone is strong. Fully walk-away, yet sensitive and quantitative, large signature bulk readouts are unique to isoplexis and necessary to the reality labs face today more than ever. Our customers tend to ask two core questions with their proteomic systems. How are the immune cells performing? High quality, aberrant or not? And what are the quantitative proteins circulating in the blood indicating on the overall response? High concentration, low concentration, and quantitated? In revealing the large immune signature, what isocode is for cells, CodePlex Q is for blood. The same large signature is necessary in the blood to avoid the bias of focusing on too few proteins, and yet customers have a critical challenge facing them. Any quantitative proteomic technology that leverages gold standard ELISA for large signature multiplexing, i.e. not an NGS-based solution, has a really expert-oriented, difficult-to-use workflow that takes full days of hands-on time. We couldn't predict that the pandemic would change labor as we know it, but it has. And labs are finding it difficult to retain trained talent. CodePlex Q is for those labs. Much like as our ISO code detects quality immune response, in our CodePlex Q, Q starts with quality, quantitative, and quick. Both products have a fundamental commitment to quality to our customers. CodePlex Q is high throughput and completely walk-away. Labs can pipette and go with no training required. Our co-founders came up with the original signature for our proteomic barcoding system, which leveraged many protein analytes directly from a small amount of blood, able to be leveraged by any clinical lab. CodePlex Q is the productization of that vision. Furthermore, we conducted a 302-person survey of mostly existing blood bulk protein users and flow cytometry users. 46% of the survey takers found the CodePlex solution very compelling. They all also pointed to what we see as obvious. They would pay much more for a system that delivered both the ISO code and CodePlex Q in one system than they would pay for a system that offered either one or the other. We are very excited for our users to leverage both products in one ISO Spark instrument to equip their labs, top quality data covering large signature single cell and bulk protein solutions at a reasonable cost. Users like the Shanghai Institute of Hematology, which demonstrated with our code flag system that the cytokine IL-7 enhanced persistent anti-tumor immune response in cell therapies as published in scientific reports. The answer to similar questions, now from the angle of the blood that the WashU team highlighted for single cell solution, While Duomic is slated for release in late 2023 and is operated by a very small team at this point, we have made critical progress on increasing the matched barcode throughput to enable a greater number of cells that have both gene expression and the proteome readout. Customers still send us many requests for this product, and we're still aiming for a 2023 offering at the end of the year. And Duomic will also be running the ISO Spark, providing further value to our customers on one system. Finally, I want to welcome Homi Shamir as a member of our board of directors. Homi most recently served as the chair and chief executive officer of Luminex Corporation from 2014 through its sale to Diasorin in 2021. We believe his insights into scaling large businesses in the life science, diagnostic, and device fields will be invaluable as we take the next stage of our journey. I will now turn the call over to John for more detail on our financials.