Analyst Conference Summary

biotechnology

conference date: August 14, 2024 @ 5:00 AM Pacific Time
for quarter ending: August 14, 2024 (second quarter, Q2)

Forward-looking statements

Overview: Slow growth of patient starts and revenue, rapid cash burn.

Basic data (GAAP):

Revenue was $16.1 million, down 13% sequentially from $18.6 million, but up 133% from $6.9 million year-earlier.

Net Income was negative $na million [Q2 and Q1 have been delayed].

EPS (Earnings per Share) were negative $na. [Q2 and Q1 have been delayed]

Guidance:

Expects about 85 patient starts in 2024. First revenue from Lyfgenia as late as Q4. Anticipates revenue drop in Q3, then an increase in Q4. Cash should last into Q1 2025.

Conference Highlights:

Andrew Obenshain, CEO, said "We are seeing clear evidence that our commercial launch is accelerating, with over 20 cell collections completed in sickle cell disease and beta-thalassemia to date in 2024, and more than 40 additional patients already scheduled to initiate the treatment journey for a bluebird gene therapy by the end of this year. We are further encouraged by the commitment to provide patient access across both commercial and government payers, most recently conveyed through multiple positive Medicaid decisions and the growing number of published coverage policies for Lyfgenia, and we expect approximately 85 patient starts across our portfolio this year" Expects to reach profitability some time in the next five years. Renegotiated agreement with Hercules Capital, allowing possible $50 million more borrowing. Believes Lyfgenia is prefered over the competitor.

Still working on accounting restatements, will also be late with Q2 2024 10-Q.

Lyfgenia has now completed 4 patient starts. The first patient start for Lyfgenia for sickle cell disease was in May 2024. But revenue from the first infusion is not expected until Q3 or Q4 2024. Bluebird confirmed prior authorization approval for commercial and Medicaid-insured patients for Lyfgenia.

Zynteglo for beta-thalassemia completed 20 patient starts in 2023 and added 19 in 2024. In Q2 additional manufacturing capacity was approved.

Skysona for cerebral adrenoleukodystrophy (CALD) had 6 patient starts in 2023 and 4 additional in 2024.

Bluebird continues to make progress arranging reimbursement for its therapies and centers for their administration. To date 70 QTCs (qualified treatment centers) activated for Lyfgenia and Zynteglo and 6 for Skysona. Multiple outcomes-based agreements have been reached for Lyfgenia. States covering about 20% of sickle cell patients have completed prior authorization for Lyfgenia. Zero ultimate denials to date.

Expects gross-to-net discounts across all three products to be in the range of 20% to 25% of gross revenue in 2024 and expects fluctuation based on product, payer mix, and outcomes-based agreements.

Patients under the age of 12 are in study of lovo-cel, with enrollment completion expected in Q4 2024.

Cash and equivalents ended near $193 million, down sequentially from $264 million.

Financial statements for 2022 and 2023 will be restated on its next 10-K. No impact on its cash position is expected.

Q&A selective summary:

40 patients scheduled for cell collection rest of year? Confident in H2 acceleration. Takes time to get through process, little dropping out, a few reschedule collection.

Revenue recognition? 20% to 25% discount to gross? For all 3 products.

Revenue recognition should come within 2 quarters of cell collection.

We are focussed on states where sickle cell patients live, raise the rate of Medicare reimbursement.

Lyfgenia has a longer path to patient starts, including the approval process. Patients schedule many months in advance. Demand is strong, it is simply a timing issue.

We have about 3 times as many approved centers as our competitor for sickle cell. QTCs prefer Lyfgenia.

Confidence in projections? Number scheduled grows each week, but tend to schedule well in advance, so soon will be scheduling for Q1 2025, which won't increase our 2024 numbers.

All of our clinical trial sites have gone on to become QTCs.

Triggers for second two tranches of debt? Hercules has been a great partner. 2nd traunch (25 million) becomes available if we procure at least $75 million in gross proceeds from additional financing this year, and at least 50 Lyfgenia starts by March 31. Next $25 million similar financing and sales requirements.

Vertex ahead is cell collections? No, we reported 43 starts since approval. They had 20 global starts. We believe we have the lead position in the [WM: American?] market.

Additional sources of funding? Range of options, debt and equity. No specific comment.

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