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spk01: Good day and thank you for standing by. Welcome to the Quinterix Corporation Q2 2023 earnings 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 1 on your telephone. You will then hear an automated message advising you that your hand is raised. To withdraw your question, please press star 1 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Ed Joyce, VP of Investor Relations. Ed, the floor is yours.
spk03: Thank you, Stacey, and good morning. With me on today's call is Masoud Tolu, President and CEO of Quinterix, and Mike Doyle, Chief Financial Officer. Before we begin, I'd like to remind you of a few things. The call will be recorded and will be available in the Investors Resources section of our website. Today's call will contain forward-looking statements within the meaning of the U.S. Private Security Litigation Reform Act. These forward-looking statements are based on management's beliefs and assumptions and on information available as of the date of the call. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties, assumptions, and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statement. The risks and uncertainties that we face are described in our most recent filings with the Securities and Exchange Commission. To supplement the company's financial statements presented on a GAAP basis, the company has provided certain non-GAAP financial measures. Management uses these non-GAAP measures to evaluate operating performance in a manner that allows for meaningful period-to-period comparison and analysis of trends in its business. The company believes that such measures are important in comparing current results to the other period results and are useful in assessing the company's operating performance. The non-GAAP financial information presented here should be considered in conjunction with and not as a substitute for the financial information presented in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures set forth in the appendix of the presentation posted to our website and in the earnings release issued today. With that, I'll turn the call over to Massoud.
spk04: Thank you, Ed. Good morning. Before I get into results, I would like to start by acknowledging the intense effort and progress the talented Quanterix team has made with our corporate transformation started last year. The magnitude of the improvements made while continuing strong operational execution is testament to the capabilities of our people. and these improvements have set a solid foundation to drive long-term future growth. This quarter, those strides became more apparent in our business and financial performance. Second quarter revenue increased 32% to $31 million, and our non-GAAP gross margin increased to 56.4% versus prior year, with significant sequential improvement. We're seeing strong customer demand, driven by consumables, and accelerator lab business, with increases of 65% and 94%, respectively. Our corporate transformation is also already positively impacting bottom line performance. This quarter, we achieved a break-even cash flow milestone. With our accelerating redevelopment progress, we increase our full year 23 revenue guidance to be in the range of $110 to $116 million, and full year non-GAAP gross margin percentage in the high 40s. We also expect less cash burn and now estimate to be in the range of 30 to 35 million this year. To remind you, we initiated our corporate transformation a year ago following a strategic business review with the prime objective of maximizing the potential of our Samoa technology and delivering high-quality assays at scale with strong margins. We're now in the last two quarters of our transformation process and remain on track. Work that remains includes launching new assay kit SKUs and further implementation of newly scaled systems and modern processes in our operations lines. The intensity at which our team at Quanterix have made progress is remarkable. These efforts will directly impact our long-term growth and drive future positive cash flow. In early July, we launched LUCIN-AD, a test to aid in the Alzheimer's disease diagnostic process. This blood-based biomarker test measures an isoform of phosphorylated tau protein 181. Using our high sensitivity platform, this protein has been positively correlated with the presence of amyloid pathology in brain, a hallmark of Alzheimer's disease. LUCIN-AD provides measurements with cut points to indicate unlikely or possible amyloid pathology. With the recent approval of LeCambie, one of the first promising therapies for Alzheimer's disease, we anticipate this test will enable access to quick and scalable screening. There's a lot of attention on Alzheimer's disease, and we will deploy focused effort on building global infrastructure, as well as patient and provider education around these tests. Moving to recent events. There were two notable announcements from the Alzheimer's Association International Conference that I'd like to bring to your attention. First, new guidelines were recommended by the National Institute of Aging and the Alzheimer's Association for the use of blood biomarkers to detect and diagnose Alzheimer's disease. All of the biomarkers listed are available on Samoa. This makes a lot of sense, being able to screen large numbers of people with with suspected cognitive symptoms require scalable, cost-effective testing. Numerous studies using our Samoa technology have demonstrated high correlation between blood-based biomarkers, like those measured by LucinAD, to the more expensive and invasive methods of testing in Alzheimer's, such as spinal fluid analysis and amyloid PET scans. Any lab anywhere in the globe can order the Samoa platform and begin running every biomarker listed in the guidelines today. That reach, along with the scale of our CLIA lab, puts us in a great position to help build the global testing infrastructure needed for Alzheimer's therapies. Second, data from a study was presented demonstrating the possibility for home blood collection for Alzheimer's biomarkers. Researchers at the University of Gothenburg in Sweden used Samoa technology to test for biomarkers from dry blood spot cards collected from a finger prick. That's not a lot of blood. We're talking tens of microliters. Starting card samples were shipped to a testing facility without temperature control, and results showed high correlation to regular blood-drawn samples for all biomarkers tested, including PTAL-181, PTAL-217, NFL, and GFAP. Although this was an early study, it demonstrates the ultra-sensitive capabilities of our similar platform, as well as promise for patients and providers as the potential for a home test would be a significant advance over traditional blood collection. Pretty incredible advance. Now this decade, we expect a number of emerging disease-modifying neurological therapies, and most of these will need early cascade diagnosis and routine monitoring. which will require ultrasensitivity to identify biomarkers in blood. As we discussed last quarter with the approval of Tofersen measuring neurofilament light chain, or NFL, we're seeing increasing attention of this biomarker for neuroinjury conditions. However, normal NFL levels vary between adults and adolescents, and there's a need for a comprehensive reference data set by age. Recently published in Lancet Neurology, Samoa enabled a study to produce a robust data set for pediatric NFL levels. This data set will provide a foundation for the clinical use and management of neuro conditions in children. This work was a significant step forward and further establishes Samoa as the go-to test for blood NFL measurement. Moving to our clinical efforts. This quarter, we achieved a positive top-line readout of our BioHermes clinical trial, which was a 1,000-patient prospective validation study done in collaboration with the Global Alzheimer's Platform Foundation. The study had 18 sites and aimed for a diverse demographic to better represent the entire base of potential patients, an important consideration by physicians and regulators. I'm pleased to announce Our primary objective with the study to show high correlation between 181 and amyloid positive PET scans was achieved. This work supported both our new LACIN-AD LDT and is expected to support our IBD filing with the FDA. Now before I turn the call over to Mike, I want to take a moment to recap. Our corporate transformation, while not yet complete, is bearing accelerated gains because of the focus, discipline, and execution of people at all levels of the organization at Quanterix. Discoveries in the next 10 years will change the way we currently understand, test, and treat neurological disease, and we expect that much of that work will be performed on Quanterix's similar platform. Mike?
spk06: Thanks, Basud. For your reference, for those following along, I'm starting on slide eight. Our total revenue for the second quarter of 2023 was $31 million, an increase of 32% from the second quarter of 2022. This quarter's revenue includes $1 million for one-time revenue related to our agreement with UltraDx Limited in China and half a million dollars related to an Abbott license deal. We had product revenue of $19.7 million in the second quarter, an increase of 33% over the second quarter of 2022. Within product revenue, instrument revenue was 3.5 million, a decline of 38% over the second quarter of 2022. As described last quarter, and similar to other life science instrument providers, we continue to see global macroeconomic pressures on capital purchases. Offsetting this decline, our consumable revenue increased $6 million, or 65%, compared to the second quarter of last year, and up 8% versus the prior quarter. While we continue to manage production and demand for consumables as we address assay quality, we've made improvements that have allowed us to increase capacity. Services and other revenue was $10.6 million for the quarter, increasing $2 million, or 23%, from the second quarter of 2022, driven by strong demand for accelerator services. Our accelerator services continue to be a valuable customer offering, particularly when biotech and pharma experience pressure on CapEx purchases. While we don't expect further decline in instruments for the second half of the year, we do expect both consumables and accelerator services to fully offset for the second half until biotech and pharma return to normal purchasing patterns. Now let's move on to gross margin for the quarter. Our GAAP gross profit margin was $19.1 million and 61.7% for the second quarter of 2023, compared to $8.7 million and 37.1% in the second quarter of 2022. Our non-GAAP gross profit margin, which includes shipping and handling costs for product sales within cost of goods sold instead of within SG&A expenses, was $17.5 million and 56.4% in the second quarter as compared to $6.8 million or 29.1% in the second quarter of last year. Overall, we're very pleased with our redevelopment progress, and it is reflected in better than targeted gross margin performance. Our overall GAAP operating expenses declined $5 million from $33.7 million in the second quarter of 2022 to $28.7 in the second quarter of 2023. Our net loss declined from $24.9 million in the second quarter of 2022 to $6.1 million in the second quarter of 2023 due to improvements from our redevelopment program, the impact of our restructuring in 2022, and improved interest income. Moving on to cash, which is on slide nine, we had a healthy cash burn improvement. We ended the second quarter with $332.2 million in cash, a small net decrease of about $100,000 from our Q1 cash balance. We essentially burned no cash during the quarter, driven by revenue mix, efficiency gains, and operating expense management. Our balance sheet remains in excellent shape and we remain well positioned to make internal investments and be opportunistic for inorganic investment. Let's turn to guidance, which is highlighted on slide 10. As Massoud mentioned, we're increasing our guidance for 2023. We now expect our revenues to be in the range of $110 to $116 million from a previous range of $104 to $111 million. As a reminder, we're still managing our demand and shipments as we continue our assay redevelopment efforts. Due in part to our redevelopment program as well as our anticipated revenue mix for the full year of 2023, we are adjusting our margin outlook. We now anticipate GAAP gross margin percent to be in the low 50s, and our non-GAAP gross margin percent to be in the high 40s. We do anticipate some headwind impact in the second half of the year with the launch of our new assay kit SKUs, but feel confident with our ability to execute on plan. We expect our cash burned for the full year to be in the range of 30 to 35 million, a significant improvement from last year in our previous guidance. I will turn it back over to Massoud before we take your questions.
spk04: Massoud? Thank you, Mike. I want to provide an update in regard to our financial leadership transition plans. As previously announced, Mike is planning to retire in early 24, and we've been searching for a new CFO. And it's an exciting time, you know, clearly to join Quantarix. And I'm thrilled to say that we found someone amazing to join our team. So we'll be making a formal announcement tomorrow morning, and the official transition is set for August 21st. At that time, Mike's going to transition to Executive Director of Finance, supporting our strategic growth until his retirement in March. So I want to take a moment to acknowledge the pivotal role Mike has played in the transformation of Quanterix. Specifically, his guidance, dedication, and financial leadership over the past two years has put us in a strong position. He has made a lasting impact on our business. We're appreciative of his service, thankful for the solid transition period, and look forward to what's ahead in the coming months. Operator, let's take some questions.
spk01: Thank you. We will now conduct the question and answer session. As a reminder, to ask a question, please press star 1 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 1 again. Please stand by while we compile the Q&A roster. Our first question comes from Puneet Sudha of Lyric Partners. Puneet, please go ahead with your question.
spk08: Okay, thanks. Masood, Mike, thanks again, and congrats on the quarter here. Mike, really great working with you, and good luck on what's ahead. Maybe if I could, first one, maybe if I could ask on the guide, and then I have a follow-up on Lucent and on the biomarker set. You know, we look at the foliar guide. If you go to the higher end of the guide, it still implies a step down in 3Q and 4Q. I know you talked a little bit about obviously the biotech funding situation that is well understood and known on the street. Is that largely part of the, you know, conservatism in your assumptions here? or is there something else that we ought to keep in mind for the second half? I just want to, you know, clarify on the top line and also on the gross margins.
spk06: Sure. I think a couple of things. I think, you know, we obviously had some one-time revenue in this quarter. And so when I look at the 31, I really look at it at about a $29.5 million quarter. So I think, you know, we – you know, we're still balancing our redevelopment effort. And, you know, this last couple of quarters, which I'm sure Massoud's going to get into, is when, you know, we really, it's the last big push. So we expect a little bit of noise, and we're trying to just sort of make sure that we've, you know, given ourselves some room there. Clearly, you know, our goal is to exceed that. But, you know, that's how we're looking at it. I don't think there's anything else out there other than what we've chatted about that, you know, that we would see impacting our revenues.
spk04: Yeah, I think that's right. You know, clearly the backdrop of this macroeconomic situation, I think Mike highlighted on the call that we've been able to offset that pretty effectively. We'll see what happens in the second half. And then, as Mike said, a lot of implementation of key processes in the production lines that we want to be conservative about.
spk08: Got it. Okay. And then I'm wondering on Lucent, can you clarify when this platform is going to have P tau 217 as well beyond 181? And when do you think we'll see a marker set that involves 181, 217, A beta, 40, 42? both as an LDT and then eventually as an IBD and potentially maybe one more marker, let's say GFAP in it. So just trying to understand what the final marker set could look like. When do you think you'll be able to launch that as an LDT and then eventually as an IBD?
spk04: Great question, Puneet. So our plan is to have 217 LDT this year. So, you know, some other, you know, future announcements we'll talk about including that into our Lucent series of testing. And then on your question about the multi-marker test, just, you know, as you know, the multi-marker test today already exists at Quanterix as an RUO offering. And then to your point, we intend to add that to the Lucent AD offering after we complete some of our clinical trial work. So we talked about the results of biohermes specific to 181. We're expanding that and looking at multi-marker with that study. And then we have a very exhaustive large study with ADDF where we're looking at all the markers that you just mentioned with an algorithm to look at amyloid pathology for patients. So that's also upcoming. And again, on the regulatory side, our intention is that we'll be submitting these to the FDA along with the clinical trial findings.
spk08: Got it. And then last one for me. Can you talk a little bit about the level of validation that you have currently with your assays and what is needed for the diagnostic assay for the LDT and potentially for the IVD as well. And, you know, sort of what sort of level of readiness that you have as Lecumbie and Donimumab, these drugs get on the market. How do you think, you know, scalability, if rapid scalability is required, just want to get a sense of if you, you know, validation and other things that might be needed for those assays. How positioned are those assays from both a validation point of view and scalability point of view? Thank you.
spk04: Thanks, Puneet. Yeah, so when we, you know, I would say the foundation, first let's start at the foundation of the assays. We're talking about hundreds and hundreds of publications over, you know, peer-reviewed publications over the last several years that have shown the biomarkers that we were talking about, 181, 217, NFL, GFAP, together, you know, incredible correlation to amyloid pathology. This is really robustly shown. And that's kind of our RUO basis. We take that one step further, and we're working on these prospective clinical trials. So the BioHermes, for example, trial that is used to support our PTAL-181 LDT was an 18-site U.S. trial. Over 20 of the samples were from underserved populations, critical for Alzheimer's testing, as you'll probably hear about more and more in the news. And we looked at imaging, clinical, and other key data to support our LDT. And we look at patients that are cognitively unimpaired, MCI and mild AD patients, and we compare each of our tests to imaging. and to CSF. And that's the data and the backing we have for our 181, and we expect to continue to do that for each of our tests that come out as an LDT. And we think the data and robustness is also sufficient to support future regulatory filings. So from a clinical trial utility perspective, we have great work that's ongoing by the team. And then from a scale perspective, we believe that Scaling these assays are going to be critical. Blood-based testing is going to be critical for entry to therapy. And how do you scale the test in a robust way as possible? We think, number one, you heard about the guidelines. All of the markers and the guideline today can be run in Samoa. And we'd support any lab globally who would purchase a Samoa platform to get their lab up and running for them to do testing. The second, we can do thousands of samples here in our CLIA laboratory on a weekly basis, and we think that will take some level of support for building this global infrastructure. So I think we have a plan. We have a good clinical trial plan and a good go-to-market plan on LucentAD. So we're very excited about the next several months. Okay, super good. Thanks.
spk01: Stand by for our next question. Our next question comes from Kyle Mixon of Concordia Genuity. Kyle, go ahead with your question.
spk09: Hey, guys. Thanks for taking the questions. Congrats on the quarter and congrats on the progress on this redevelopment program. On the program, Masoud, I just wanted to ask how you've been able to convey to customers that the reproducibility, the scalability of your assays is now improved and how that approach and how you know, the customer response kind of differs between those REO and the biopharma customers.
spk04: Yep. Hey, Kyle. Thanks for the kind words. We, I would say that, you know, if you look at our, whether it's our consumables, Kyle, or our accelerator, I mean, we're hitting, you know, levels of demand that, you know, the company has never seen before. So, and I'd say that what we're able to manage and ensure is that if it's a product that's leaving the doors at Quantirix, it's a quality product in the customer's hands. So I'd say we've done a great job at doing that. And then over the next several quarters, we're going to ensure that those SKUs that are leaving the door are also scalable and, you know, accretive to our margins. So, you know, couple quarters of work left, but right now, today, we're getting good assays to customers and we're providing solid work through our accelerator program. And I think the results speak for themselves.
spk09: Okay, that was great. And then just following up on the biohermes, so are we completely done with readouts for that trial? And then did you comment on the timing for the IVD approval?
spk04: Yes, so we are complete with our 181 study, and so that the BioHermes trial data supported both our LDT and the FDA filing we have that exists for our PTAL 181 test. Now, what we're going to do next is we're taking a look at other biomarkers with that data set, and there'll probably be more news in the future. on biohermes. But with regard to 181, our intention is for, you know, peer-reviewed publication on those testing results. But you can already see the data for that and our sense and specs on the LUCIN-AD website. And then, you know, on the second trial that we've been talking about is this multimarker test with ADDF. That's a global test, global trial, and that's going to be to support the multi-marker. We haven't mentioned any sort of timing on regulatory filings. As you know, we have a breakthrough designation for 181, and we've talked about doing more work with the FDA as we progress.
spk09: Okay, awesome. And then maybe, Mike, if you want to comment on this, and I guess congrats on the next steps and look forward to kind of chatting about it soon. on the prioritization of cash, you have cash of $330 million, and the net cash flow in the quarter was break-even, which is great. I mean, it's fantastic. I think in the past, you estimated that you will achieve positive cash flows at the $170 to $190 million range for revenue. That's like 2026, maybe. I guess I wanted to ask, is that pushed up now? I guess pulled forward, could you kind of reach that point earlier? And just given all this cushion now, I mean, how do you kind of anticipate using cash going forward? Could you kind of crank up the spending to drive revenue growth or really scale Lucent or AD or something along those lines?
spk06: Yeah, thanks, Colin. I think, first, we haven't adjusted our projection. Long-term for one will be, I would say, cash flow positive consistently. I'd say we'd still keep our current guidance in place, probably updating it in February. And we were super happy with the quarter. and, you know, I think what it's demonstrated is we are running ahead from a financial standpoint, and I think that, you know, we've been very focused on the assay redevelopment. I think what you're going to start to see, and you've touched on some of it, Kyle, is investments in, you know, organic investments in the business, also funding, you know, more for LucentDX, so I expect we're going to see cash go out. CapEx was light in the first half of the year as we stayed focused on the the assay redevelopment, it's going to pick up in the second half of the year. And I think we're looking at, because we have, you know, the cash we do, a number of things both organically and, you know, down the road inorganically that will help us accelerate our ability to grow. So, and like I say, we'll probably be updating guidance in February on the call, and we'll probably update, you know, our targets for cash flow breakeven as well.
spk09: Okay, perfect. Sounds good. Thanks, guys. Appreciate it. Thanks, Kyle. Thanks, Kyle.
spk01: Stand by for our next question. Our next question comes from Matt Sykes with Goldman Sachs. Matt, please go ahead with your question.
spk07: Thanks for taking my questions, and congrats on the quarter. And Mike, congrats on the next chapter. It's been great working with you. Maybe just the first question for you, Mike. You know, you've previously talked about double-digit top line growth for 24. Just given the guidance raised last quarter and this quarter, Are you still kind of thinking about that as a range for next year and any kind of clarity on double digits? It could mean a lot of different things.
spk06: Yeah, it can. You're right, Matt. Because obviously we've had a good quarter, and the point of the guidance would suggest this is our core product, that we're there. And I think our goal is to accelerate from there. We haven't fleshed out yet – a 24 forecast that gets more specific about what double digit looks like and feels like. Um, but clearly our intent is to accelerate off of where we are today. Um, so that's, that's, you know, that's like probably all we're going to say on it right now, but I expect, you know, again, in February we'll be giving a more robust view of, of the, um, of the year and what double digit is going to look like. But, you know, clearly we're, we're in a good place right now and are feeling pretty good about where we sit this year. And, uh, We're obviously on the core products cracking double-digit right now.
spk07: Got it. Thanks for that. And then you mentioned in the prepared comments about the Abbott collaboration and some of the revenue you received from that. Can you just maybe provide a little bit more color? Apologies if I've missed this in the past, but just a little more color on what you're doing with Abbott.
spk06: Yeah, actually, the Abbott is an expiration of an old license deal, so it's not an active. Essentially, you know, we received funds some time ago for a license that's now expired, so we're recognizing it in revenue. So it's not new activity per se with Abbott. And then the million dollars from UltraDx is a reflection of shares that we were issued in the UltraDx venture in China. So, you know, in both instances, those are one-time revenue. and they're not going to repeat. And they impact margin in a favorable way this quarter by about 250 basis points, Matt, just to give you some perspective there.
spk07: Got it. And then just one last one for you, Massoud. You talked about the study that looked at finger prick testing in the blood cards. Could you maybe just talk longer term about what you think that could do in terms of accessibility, but also kind of what the timeline potentially for that could be and how it would be incorporated into your logistics and technology if that were to happen.
spk04: Yeah, absolutely, Matt. So, you know, I'll just say that, you know, we're sort of on the heels of all this excitement on, you know, blood draw and traditional collection methods, but keep bringing up this concept of global scale and global infrastructure. And, you know, while, you know, in the U.S., you know, let's say 90% of the population is near a place where you can do a blood draw, we have to think globally. And there are a lot of places where low temperature, storage, transportation, centrifugation, those are all issues. And what we were really excited about by this study was that it demonstrated the ability to do remote collection and quantification of all the biomarkers that we have. And so we could see this as a screening and monitoring tool in secondary care. in therapeutic trials, so expanding access to therapeutic trials to underserved populations, which is going to be important for future therapies, as well as the storage concept and being able to monitor progression of treatment response in an easy way so you don't have someone coming in on a regular basis for a blood draw and you can do this more at home. So it's early days. in the study and the cohort and the population, you know, was a small population. So I do want to, you know, say that. But incredibly promising data on the correlations with PET and CSF. And so we're very excited about what this study could be and think that there's a lot of interesting work that could come within the next year or so for detecting these biomarkers. And then the final point I'll make is that, you know, this sort of goes to show, I mean, we're talking, you know, a blood draw, hundreds and hundreds of microliters. Now we're talking about tens of microliters, and the need for a platform that has high sensitivity to detect that in those tens and tens of microliters is what's required to enable blood, you know, CAR testing. And so, again, very excited about the prospect of these results.
spk07: Got it. Thanks very much, guys.
spk04: Thanks, Matt.
spk01: And our final question comes from Dan Brennan with Cowan.
spk02: Thanks for the questions. Congrats on the quarter. Maybe one on placements and then one back on Alzheimer's. Just can you speak to instrument placements in the quarter chart if I missed it and what are the expectations throughout the year? You know, how much of softness is due to APAC? I think you called that a distributor issue in 1Q. Just maybe some color there.
spk06: Yeah, Dan. I mean, placements on the quarter were – net placements were 22, which is – you know, that's a low for us. You know, historically, we've run high 30s to 40s, and it started to drift late last year. You know, Q1 placements were 32. So we're down. I think AsiaPAC – was our issue in q1 i think more broadly and i think masoud mentioned i did as well we're seeing it really across the board i think there's just a macro um effect on capex that's impacting us and we're seeing it in north america europe and in asia pac asia pac actually in the quarter performed better than they did a year ago so um it bounces around now the good news for us is You know, we still are getting revenue from people who would otherwise purchase. I think Masoud referenced, you know, I think folks are running more through our accelerator lab, you know, as opposed to purchasing an instrument. So I think as the broader macro improves, we're going to see instruments pick up, which is encouraging. But right now, it's, you know, we're kind of at a, it's going to be soft. I don't expect it's going to degrade from where we are. that's how we're projecting and building out the balance of our year. And we expect in 2024 a return to something more normal.
spk04: Yeah, Dan, one of the really unique capabilities that we have is that when we've seen biotech or pharma capital equipment pressure or a kind of macroeconomic challenge, we tend to see these companies outsource more and more of their work. to our accelerator lab. And we're clearly seeing more of that and expect this to continue for the second half of the year. So accelerator for us is both try before you buy, but it's also outsourcing a lot of R&D work. And in the future, we expect those customers will, once there's less pressure, come back and purchase those platforms.
spk02: Great. Thank you for that. And then maybe just kind of a bigger picture one on Alzheimer's. And I apologize if maybe this was mentioned a little bit throughout, but just maybe to get a list. What are the, if we look at over the next 12 months, like what would you say are the key milestones to watch that would be kind of most important just to kind of check progress and see if the opportunity is materializing for Quatera?
spk04: Yeah, so, yeah, and I think the, you know, we talked about the readout on this biohermes test and how it's supporting our LDT and also our IBD filing. I think It was a question earlier in the call related to 217 that Puneet asked. I think that's pretty important. 217 is a biomarker that you just can't measure on any platform, right? And so Samoa is one of the platforms that you can detect 217. And so the interest and demand for 217 is important. And one of the reasons you're kind of hearing about that importance is because As these drugs and these therapies come out, we're seeing data that shows the earlier you can identify a patient in the disease cascade, the better the therapy works. And so 217 is one of those early markers. And so from a standpoint of a screen or a diagnosis, you can get a better patient cohort, and it looks better from a rule-in perspective. So we're very excited about that. I think that'll be a big milestone. And then the second is on the multi-marker. You know, can we do differential diagnosis? Can we use a multi-marker to get more information on these patients that might get a negative result and are asking, hey, you know, I have cognitive symptoms, but I'm getting a negative result. Now what? And so, you know, behind what we're talking about here is intensive program to build solutions for patients. And so I think I would view those two as the next two key milestones. And then externally, I think if you look at the guidelines, some of the biomarker promise and blood biomarkers is incredible. And so we expect in the next several months there to be more discussion about blood biomarkers and and their adoption from not just the screen, but more and more towards diagnosis of patients instead of a spinal tap or a PET scan. So, yeah, I kind of would view those sort of three areas as key milestones for us and for the field. Great. Thanks a lot. Thanks, Dan.
spk01: I am showing no further questions at this time. This concludes today's conference call. Thank you for participating. You may now disconnect.
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