Quotient Limited

Greetings and welcome to Quotient Limited third quarter fiscal year 2022 financial results conference call. At this time, all participants are in 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. As a reminder, this conference is being recorded. And I'd like to turn the conference over to your host, Mr. Ali Kiboro, Chief Financial Officer of Quotient Limited. Thank you, and over to you, sir.

Thank you, Vikram. Good morning, everybody, and welcome to Quotient's third quarter fiscal year 2022 financial results, as well as a business update. Joining me today is Manuel O. Mendez, our Chief Executive Officer. Today's conference call is being broadcast live through an audio webcast, and a replay of the conference call will be available later today at www.quotientbd.com. During this call, Quotient will be making forward-looking statements, including guidance and projections as to future operating results and expected development and commercialization timelines. Because such statements deal with future events, actual results may differ materially from those projected in the forward-looking statements. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements can be found in Quotient's filings with the U.S. Securities and Exchange Commission as well as in this morning's release. The forward-looking statements, including guidance and projections provided during this call, are valid only as of today's date, and Quotient assumes no obligation to publicly update these forward-looking statements. With that, I would like to turn the call over to Quotient's Chief Executive Officer, Manuel O. Mendez.

Thanks, Ali, and good morning, everyone. Thank you for joining us today for our third quarter of fiscal 2022 results and business update. I would like to thank the entire Quotient team for the dedicated support and resilience this quarter, despite disruption created by the COVID Omicron surge. Today, we'll be updating you on three pillars, the Mosaic solution, ABBA by quotient, and quotient's financial position. The first pillar is our mosaic solution. We'll begin with highlights on our transfusion pipeline. We are very pleased to share the notified body completed the assessment of the technical dossier and advise it will recommend the mosaic expanded immunohematology microarray for CE marking approval. We are excited to offer the mosaic solution and the expanded immunohematology microarray to our customers once we receive the CE marking expected in first quarter calendar 2022. Shifting beyond development, our focus has also been on Mosaic commercial execution. As previously communicated, a diversified global presence is key to our go-to-market strategy. We continue to make progress on both our commercial growth initiatives, tenders, and distribution strategies. We have identified more than 20 immunohematology tenders in the EU, which are expected to become available over the next 18 to 24 months. Also, we are active in preparing for tenders in the rest of the world where CE marking approvals are accepted. Additionally, we're actively discussing commercial distribution offers with potential partners to build a commercial network across the EU, Middle East, and Africa for the Mosaic solution. In order to support these commercial efforts, last month we attended for the first time the Arab Health and Med Lab Middle East Conference. There we met with potential commercial partners from the Middle East, the EU, Asia Pacific, who expressed an interest in partnering with Quotient. As a result of the team's efforts, we're engaged in commercial negotiation process with more than 10 distribution partners. In parallel to our commercial activities, our manufacturing and operations team continues to make progress to drive scale-up to fulfill anticipated customer demand. This will be led by our new Chief Manufacturing Operations Officer, Esteban Uriarte, who joined us earlier this month based in Essam, Switzerland. We all look forward to working closely with him on the advancement of our strategic initiatives to better serve our customers. Last quarter, we placed orders for additional Mosaic instruments for the second half of 2022. We currently have enough instruments to fulfill the initial expected customer demand. At the last earnings call, we communicated our scientific and medical affairs priorities, which includes the Innovator Circle, Scientific Advisory Board, and research program initiatives led by Dr. Christine Ginocchio, our Chief Scientific and Medical Officer. The Innovator Circle is designed to be a global community of experts invited to participate in an open discussion to demonstrate the operational value of the Mosaic solution to help strengthen scientific and medical evidence. We are pleased to announce that we have exceeded the number of targeted Innovator Circle participants communicated last quarter. Previously, we were targeting four to five institutions, and we are now in communications with seven institutions currently in the contracting phase. One of those institutions, the Blood Assurance signed a partnership contract with us this month to advance the Innovator Circle initiatives. We are very excited about this collaboration, as Blood Assurance is a full-service regional blood center based in Tennessee, serving healthcare facilities in five states in the southeastern portion of the U.S. I'd like to conclude our update on the Mosaic solution and the value we can provide with an update on our clinical diagnostics program. We plan to leverage the know-how acquired through our mosaic instrument and microarray development to address the needs of clinical diagnostic customers. We have expanded our clinical R&D team to gain access to the clinical diagnostics market with particular focus on the estimated 4 billion allergy and autoimmune addressable market. We are exploring third-party collaborations in this field to develop the first wave of panels. In allergy, we intend to initially focus on the identification of inhalant herbal allergy panel. In autoimmune, we intend to initially focus on differential diagnosis of connective tissue diseases panel. Now, I'd like to connect and update you on the second pillar, Alba by Quotient. The company submitted the first IBDI filing this quarter for Alba by Quotient reagents. In addition, new distributor partners for Mosaic are expected to also sell ALBA by quotient portfolio, thereby expanding ALBA's geographical footprint. Lastly, the third pillar I would like to update you is on quotient's financial position. Last quarter, we achieved $10.2 million in revenue and 16% growth over prior years. This increase is mainly related to larger-than-anticipated shipments of products in our OEM portfolios. Our cash and cash short-term investments as of December 31st, 2021 was 103.8 million, which enables us to continue to support the Mosaic pipeline development and commercialization efforts.