Analyst Conference Summary

biotechnology

conference date: August 7, 2024
for quarter ending: June 30, 2024 (second quarter, Q2)

Forward-looking statements

Overview: May be turning around with focus on Abecma sales increase.

Basic data (GAAP):

Revenue was $9.0 million, up sequentially from $12.4 million, and down from from $36 million year-earlier. Q2 gain on sale to Novo Nordisk $48 million.

Net income was $25 million, up sequentially from negative $53 million, and up from negative $42 million year-earlier.

Earning per share (EPS), diluted were $0.45, up sequentially from negative $1.01, and up from negative $0.83 year-earlier.

Guidance:

Has cash runway beyond 2027. $40 to $60 million net cash use in 2024, a reduction from prior guidance. Could be cash flow even as soon as 2025.

Conference Highlights:

Chip Baird, incoming CEO, said "We dramatically reduced our cost structure and strengthened our balance sheet with the completion of the sale of our oncology R&D business to Regeneron and the sale of our Hemophilia A program and gene editing technology to Novo Nordisk. These changes move us closer to achieving quarterly profitability by the end of 2025. We were pleased to see that Abecma turned a corner in the second quarter, recording modest growth in revenue in the U.S. Importantly, we saw a meaningful increase in patients undergoing apheresis, which we expect to translate to additional revenue growth in the third quarter. We look forward to the continued execution of our third line launch in the second half of 2024 and a continued return to growth for Abecma." Abecma sales at Bristol increased sequentially, but TSVT's revenue from that decreased slightly. Optimistic about return to growth in Abecma sales, given new third-line label. Expects operating expenses to continue to decline.

On April 4, 2024 Abecma received third line approval from the FDA for multiple myeloma. This is a much larger addressable population, but does not expect meaningful growth until H2. Abecma has received third-line approvals in Japan and Switzerland. It gained a positive CHMP opinion in the EU. Approval in the U.S. would signal a return to growth. Manufacturing capability is being prepared. In Q1 2024 the FDA approved suspension lentiviral vector (sLVV) for manufacturing Abecma. The transition to sLVV manufacturing will support anticipated increased demand in earlier lines.

Revenue by type: service $4.6 million; Abecma collaboration $4.3 million; royalty and other $0 million. Gain on Sail to Novo Nordisk $48 million.

2seventy bio and Bristol Myers (BMY) share equally in all profits and losses related to development, manufacturing, and commercialization of Abecma in the U.S. 2seventy reported collaborative arrangement revenue of $4.3 million in Q2, down sequentially from $4.7 million for Q1. That is based on Bristol Myers Q1 Abecma revenue of $95 million, up sequentially from $82 million, and down from $132 million year-earlier.

In January 2024, announced a strategic realignment of to focus solely on Abecma. 2seventy entered into an asset purchase agreement with Regeneron Pharmaceuticals to sell its oncology and autoimmune research and development programs, clinical manufacturing capabilities, and related platform technologies. This closed in Q2 2024.

At the end of the quarter the balance of cash and equivalents (including marketable securities) was $202 million, down sequentially from $na million.

Operating expenses of $36 million consisted of: R&D $16 million; cost of manufacturing $3.5 million; SG&A $10 million; share of collaboration $0 million; restructuring $7.4 million; loss from fair value change $0.7 million. Loss from operations $27 million. Interest income $2.5 million. Other income $1.4 million.

Analyst Q&A, selective:

Types of third line patients? Third line and later, hard to separate out. Believes just starting to see 3rd line. Mainly academic centers, including seeing some write scripts recently that had not for a while. Messaging is on efficacy results and the safety profile.

Sales assumptions for break-even prediction? Total US annual sales of less than $400 million would allow for break even, given our reduction in costs.

Third line uptake curve? Stay tuned, should see in Q3 results from BMS. Growth in apheresis in Q2 should lead to higher revenue in Q3. Early experience has been positive. But note the market has evolved, there is not the bolus we saw when approved for 5th line.

We are not providing revenue guidance yet. We don't expect Regeneron products to be a source of income for at least a few quarters, its main benefit is cost reduction.

Bispecific competition? We believe we have a better safety profile, but it is too early to see effect on competition. CARTs seem to be preferable to PCEs.

Real world, so far, Abecma appears to have very low toxicity compared to other products.

OpenIcon Analyst Conference Summaries Main Page

Search

More Analyst Conference Pages: