Singular Genomics Systems, Inc.

Good afternoon, everyone, and welcome to the Singular Genomics Systems, Inc. First Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note, this conference is being recorded. I will now turn the conference over to your host, Philip Taylor.

Thank you, Operator. Presenting today are Singular Genomics founder, chair, and chief executive officer, Bruce Faventa, and the company's chief financial officer, Daylon Meter. Earlier today, Singular Genomics released financial results for the three months ended March 31, 2024. A copy of the press release is available on the company's website. Before we begin, I would like to inform you that comments and responses to your questions during today's call reflect management's views as of today, Tuesday, May 14, 2024 only, and will include forward-looking statements and opinion statements, including predictions, estimates, plans, expectations, and other information related to our financial and operating results, plans, and strategies. Actual results may differ materially from those expressed or implied by these statements as a result of certain risks and uncertainties. These risks and uncertainties are more fully described in our press release issued earlier today and in our filings with the Securities and Exchange Commission, including our most recent Form 10-Q and 10-K filings and Form 8-K filed with today's press release. Our SEC filings can be found on our website or on the SEC's website. Investors are cautioned not to place undue reliance on forward-looking statements. We disclaim any obligation to update or revise these forward-looking statements. Please note that this conference call will be available for audio replay on our website at investor.singulargenomics.com in the presentations and events section. With that, I'll turn the call over to CEO, Drew Spaventa.

Good afternoon, and welcome to Singular Genomics first quarter 2024 earnings call. It was another productive quarter, and we look forward to updating you on the progress made across the business. We will focus our call on the following areas. One, a summary of the first quarter results. Two, an update on the G4X and our spatial sequencing work. And three, focus areas for the rest of 2024. Before we get into these topics, I'd like to share some color around our shift in focus to spatial and our growing excitement in the G4X spatial sequencer. It has been a short period of time since we unveiled the G4X at AGBT in February. In that short time, we have spoken with many dozens of spatial experts and customers. two things have become clear. Spatial is quickly growing in many customer segments, and throughput is a major limitation. The demand profile for a solution that addresses this pain point is strong and growing. We believe the G4X will be uniquely suited to address this pain point and has the potential to not just participate, but to accelerate growth in spatial. The setup for the business side is also encouraging, meaning that we plan to pass along cost savings and address a pain point for customers while supporting a high margin, sustainable business. The last piece that excites us is around our novel use of sequencing in spatial. The capability to directly perform sequencing in single cells will produce a novel data type and has the potential to offer a set of features and capabilities that will enable new types of research in some of the fastest growing areas that will potentially lead to better disease diagnoses, more personalized treatment, faster and more effective drug discovery and development, and an overall better understanding of biology. In addition to the exciting development work to get G4X to market, we are currently focused on supporting our G4 customers, the majority of which we expect to benefit from our move into spatial. Now, let's move into our first quarter results. We shipped six G4 instruments during the quarter and generated $0.4 million in revenue. Of these shipments, four were to academic core or medical center labs, and two were commercial labs, bringing our total G4 shipments to 30 as of March 31st. One of the most important focus areas for us during the quarter was to maintain our emphasis on supporting existing customers. Many of our existing customers will likely transition to spatial customers over time. We continue to see improvements in system utilization and consumables pull through. With the majority of systems in the field for several months now, we are starting to see an uptick in usage with our highest monthly toll for consumables orders and shipments in April. Now, let's turn to the G4X and our spatial sequencing work. As a reminder, the G4x is designed to offer novel capabilities and unprecedented throughput for spatial profiling of tissue. Its novel capabilities will include DirectSeq, which is the sequencing of RNA in situ and has the potential to open new areas of scientific discovery. In addition, the G4x will offer readouts of targeted transcripts, targeted proteins, and a fluorescent H&E stain, all in the same tissue section. This combination of readout modalities will be offered at an unprecedented scale. With 40 square centimeters of flexible imaging area and single-day turnaround times, the G4x system is designed to enable labs to process 20 times more samples per week than existing technologies. As previously announced, we shifted our internal work to focus more heavily on spatial sequencing and multiomics and to bring the G4x spatial sequencer to market. Our team has been heads down to implement this shift and is making excellent progress. In R&D, we are advancing work on instrument and method development, expanding the types of tissue tested, and improving protocol performance for combined readout modalities. At the American Association for Cancer Research Conference in San Diego, our co-founder and CSO, Eli Glazer, hosted a talk covering some of the latest internal developments and progress with early collaborators. This included new G4x datasets that highlighted performance in human kidney, tonsil, lung, lymph node, breast, and colon SFPE samples. In addition, we presented data from two of our initial technology access partner projects, Dana-Farber Cancer Institute and the Broad Institute. At Dana-Farber, we worked with Dr. Catherine Wu to perform an analysis on the G4X for 35 bone marrow biopsy sections. The G4X was able to provide high-quality transcript protein and fluorescent H&E data from bone marrow FFPE samples, typically a very difficult tissue type. In addition, the sections were processed in a single run, allowing the researchers to envision larger-scale studies that have not previously been possible. At the Broad Institute, we worked with Dr. Paul Blaney to perform in-situ sequencing of CRISPR guide RNA plus proteins and H&E imaging. This project showcased the G4x's ability to perform direct sequencing of variable regions applicable to CRISPR-based gene editing screens, an exciting and growing area of translational research. In addition to these initial partners, we have expanded our TAP and research collaboration work with the initiation of several new projects and partners. We are seeing strong inbound interest from leading academics, researchers, and biopharma, with a growing list of potential TAP projects. We look forward to sharing more details and data on these projects in the future. Our commercial team has been actively building a funnel of opportunities through our presence at conferences and industry gatherings, targeted KOL institution outreach and discussions with existing G4 customers that are interested in upgrading to spatial capabilities of the G4x. At the recently held ABRF conference in Minneapolis, we had an opportunity to meet with current and prospective academic CoreLab customers. We hosted several talks, presenting on the latest updates on the G4 sequencing platform and our planned advances in spatial sequencing with the G4x. Feedback from existing customers during this meeting was strong, with positive testimonials shared across multiple CoreLab director panels as they described their lab sequencing experience with the G4. We hosted a well-attended customer event, which included existing customers and collaborators and scientific leaders in multi-omics. The event provided an opportunity to develop relationships and discuss opportunities for working together to bring the G4x forward to advance their research. We are encouraged by the feedback from early collaborators and the level of interest from potential users coming out of these conferences and customer discussions. We are already seeing a strong pipeline of new customer opportunities for the G4x across the academic core and medical center labs, biopharma, and CROs. In addition, we have early traction in the funnel of near-term service projects as part of the G4x technology access services program that launched in the second quarter, with interest from dozens of institutions. turning to our focus areas for the rest of 2024. Our internal focus is centered around developing the G4x platform and optimizing the spatial sequencing methods and protocols. Initially available as a service will be our V1 immuno-oncology panel with 300 genes, 12 proteins, and the ability to customize content. In addition, we continue to advance our TAP projects and research collaborations on new and innovative methods such as DirectSeq, for exciting areas of research like early cancer detection, immune profiling, and CRISPR editing. We launched the G4x technology access services early in the second quarter, and we intend to expand this capability in the coming months to support the inbound project interest received to date. We expect the ramp of service projects to be an important milestone in the second half of the year, enabling technical publications, producing KOL testimonials around the technology and value proposition, and generating commercial demand for G4x instruments. Lastly, we are preparing for the G4x Early Access Program, where a select number of customers will get early access to the G4x with the G4x system or an upgrade to their existing G4. The intent of Early Access is to both learn and incorporate feedback for broader commercial launch, as well as to generate interest and demand through third-party operation of the G4x. Now, I'll turn the call over to Dalen to go through the details of our first quarter financial results.