Yahoo Finance Nautilus Biotechnology, Inc. (NASDAQ:NAUT) Q1 2024 Earnings Call Transcript
Nautilus Biotechnology, Inc. (NASDAQ:NAUT) Q1 2024 Earnings Call Transcript April 30, 2024
Nautilus Biotechnology, Inc. beats earnings expectations. Reported EPS is $-0.00015, expectations were $-0.16. NAUT isn't one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: Good day and thank you for standing by. Welcome to the Nautilus Biotechnology Q1 2024 Earnings Conference 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. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Jeon E [ph]. Investor Relations. Please go ahead.
Unidentified Company Representative: Thank you. Earlier today, Nautilus released financial results for the quarter ended March 31, 2024. If you haven't received this news release or if you'd like to be added to the Company's distribution list, please send an e-mail to investorrelations@nautilus.bio. Joining me today from Nautilus are Sujal Patel, Co-Founder and CEO; Parag Mallick, Co-Founder and Chief Scientist; and Anna Mowry, Chief Financial Officer. Before we begin, I'd like to remind you that management will make statements during this call that are forward-looking within the meaning of the federal securities laws. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated.
Additional information regarding these risks and uncertainties appears in the section entitled forward-looking in the press release Nautilus issued today, except as required by law, Nautilus disclaims any intention or obligation to update or revise any financial or product pipeline projections or other forward-looking statements, whether because of new information, future events or otherwise. This conference call contains time-sensitive information and is accurate only as of the live broadcast April 30, 2024. With that, I'll turn the call over to Sujal.
Sujal Patel: Thanks Jeon, and welcome to everyone joining our Q1 2024 earnings call. Q1 was a highly productive quarter for Nautilus as we continue to execute on our vision to establish a new gold standard for the creation and comprehensive analysis of high-value proteomic data. In order to deliver a range of long discussed and long desired improvements in human health, biomedical research needs a dramatic acceleration in target identification and therapeutic develop. But as they have for many years, researchers remain impeded by the lack of sensitivity, scale and reproducibility of traditional protein analysis method and have emerging affinity based and peptide sequencing matters. We believe fundamentally new approaches required to overcome these limitations and to unlock the potential value of the proteome something we continue to view as one of the most significant untapped opportunities in biological science today.
We and the proteomics KOLs with whom we regularly speak, understand how important in tact single molecule protein analysis and the Nautilus platform could be to their explorations of the proteome. They know that deeper richer proteomic data could one day make it possible for researchers to more quickly identify the mechanisms of action of diseases ranging from cancer to Alzheimer's. Understanding those mechanisms will be key identifying effective treatments. Interestingly, many of these KOLs maintain a heavy focus on use of mass spectrometry for proteomics. The positive attention our platform continues to receive from them is a good sign for things to come with this critically important and influential buying model. As you'll hear from Parag in a few moments, those KOLs are encouraged by the data we shared at the recent US HUPO conference and several of them have begun imagining specific initiatives against which they plan to apply our platform as part of our early access program.
As we've previously shared, the EAP will launch in the months leading up to commercial availability in 2025. Never intended to be a significant revenue driver, the program will serve as a high-value means by which to generate data to support both internally and externally generated scientific papers, customer grant proposals and we'll get meaningful data into the hands of potential future customers. We will keep you informed as we get closer to launching the EAP. I remain pleased with the progress that has been made in development activities surrounding each of the core components of the platform including the core reagents, sample prep, affinity reagent probes, chips, flow sells, the instrument and software. For more on those and other R&D related updates, let me now turn the call over to Parag.
Parag?
Parag Mallick: Thanks Sujal. Overall, we continued to make solid progress against our core development goals in Q1. We remain incredibly focused on increasing scale, stability, and reproducibility across our consumables, assay, and platform and continue to see meaningful gains along those dimensions. This progress goes hand-in-hand with advancing the reliability, quality, and customer readiness of our instrument and software. Platform stability enhancements increased consumable scale and quality and increased instrument availability and capacity have allowed for a significant increase in the number of high cycle number protein decoding experiments that we can initiate and complete successfully. In fact, we completed nearly three times the number of experimental runs in Q1 as we did in Q4 of last year.
This increase in experimental scale is essential as we continue to optimize all aspects of our platform towards launch targets. The increases in experimental scale and asset robustness have enabled us to increase the complexity of the model systems that we are using for ecosystem wide optimization. We are excited to be continually increasing the complexity of these model systems to include an increased diversity of proteins across wider ranges of concentration. We are also excited about an increasing focus on activities critical to our commercial launch such as pre-verification studies of key platform characteristics such as reproducibility and sensitivity. From the standpoint of sharing the foundational elements of our platform with the broader proteomics community, the highlight of Q1 was our participation in the Annual Conference of the U.S. Human Proteome Organization, US HUPO.
US HUPO attracts many of the types of researchers and organizations that could be potential users of our platform was exciting to see that this year's conference attracted approximately 600 attendees more than doubling the attendance of just two years ago. This increase in participation points clearly to increased interest in the proteomics space overall. From our standing room only lunch and seminar, tour many posters, and significant traffic at our booth, HUPO provided an extraordinary opportunity to share with the community additional progress on the experimental implementation of PRISM, further detail on our multi affinity Pro pipeline, and on computational methods to estimate Vault discovery rates. In addition to continuing to educate the community about how our platform works, our goal this year was to begin introducing experimental data from our pre-verification studies that demonstrate the key performance characteristics of the platform.
This new data on both broad scale and proteoforms analysis generated a great deal of interest and questions from attendees. Specifically, we shared data showing ultrasensitive and repeatable single molecule quantification of the protein transfer. One of the key differentiators of our platform is its incredible sensitivity. This is critical for finding diagnostic and prognostic biomarkers that can be indicative of diseases at their earliest and most treatable stages. We demonstrated lower limits of quantification in the high octo to low decimal range. This represents a more than five order of magnitude better sensitivity than typical mass spectrometry methods. We also shared how by exploiting the ability of our platform to either positively probe individual molecules, we were able to quantify the abundance is of 32 distinct Tau CAR-T forms.
This measurement is not possible on both traditional and emerging peptide-based platforms. We showed the ability to also do measurements of Tau from complex samples such as enrich cell isolates. These results lay the foundation for future assays that enable more detailed investigation into molecular mechanisms of tauopathies like Alzheimer's disease as well as potentially opening new frontiers for more specific diagnostics. Beyond Tau, we showed how the platform can be applied to measure EGFR proteoforms. These findings are the results of the targeted proteoforms studies that we have been pursuing in partnership with Genentech and Amgen. I and the other Nautilites in attendance sensed the significant shift in the depth of the questions we received from attendees during the event, clearly indicating an increased understanding of and enthusiasm for the Nautilus platform.
Our booth was packed with researchers eager to understand that the platform might be well-suited to addressing their specific research questions. One of my most enjoyable conversations was with a researcher who presented work on a new Alzheimer's disease biomarker that he believes is the result of changes the abundance of a specific proteoform that is challenging to measure using traditional immunoassays. It's exciting to see how the additional data we've shared from the Nautilus platform is encouraging researchers to expand their proteomics horizons. With that I'll turn the call back to Sujal.
Sujal Patel: Thanks for the update Parag. I could not agree more with Parag's takeaway from the event. Having been there myself, I heard so many things that convinced me that momentum for the space and for Nautilus are building in lockstep. Researchers are beginning to really focus on the role that next-gen technologies like Nautilus will play in creating advances in basic biological research, enabling them to make a substantial impact on the efficiency and cost effectiveness of biomarker discovery and drug development. Our next significant opportunity to educate the community about the platform and our progression towards commercial availability, will occur when Nautilus participates as a top level sponsor of this year's HUPO World Congress October 20 through 24 in Dresden, Germany.
We look forward to that event, as it aligns closely with the timing of when we anticipate having updates on both our scientific and business progress. When it comes to educating the marketplace and bringing the community along on the Nautilus journey, you've heard Parag say many times, how committed we are to being as transparent and fulsome as we can, in our communication. To that end, and as a means of sparking interesting conversations about proteomics and its future, this quarter we introduced the translating proteomics podcast and video series, hosted by Parag and Dr. Andreas Huhmer, a 20-year Thermo veteran and now our Senior Director of Scientific Affairs. The show was not a deep dive on the Nautilus platform, rather it explores the scientific underpinnings of proteomics and challenges the audience to imagine, what may be possible in the future, where proteomic data is more easily and cost effectively created.
We are heartened by the warm reception to the show's first few episodes, and encourage anyone who wants a better and broader understanding of the space, to subscribe and participate with suggestions for topics they'd like to see addressed. For a look at our financials. Let me now hand the call over to Anna. Anna?
Anna Mowry: Thanks, Sujal. Total operating expenses for the first quarter of 2024 were $21.6 million, up $3.5 million compared to the first quarter of 2023 and $1.6 million above last quarter. This 20% increase in operating expenses year-over-year was driven primarily by continued investment in personnel and their activities towards the development of our platform. Research and development expenses in the first quarter of 2024 were $12.9 million compared to $10.9 million in the prior year period. General and administrative expenses were $8.7 million in the first quarter of 2024 compared to $7.2 million in the prior year period. Overall, net loss for the first quarter of 2024 was $18.7 million compared to $15.0 million in the prior year period.
Turning to the balance sheet, we ended the year with approximately $248 million in cash, cash equivalents and investments compared to $264 million at the end of last quarter. We continue to expect our total operating expenses to grow by approximately 25% from 2023 levels, and growth has been to steadily increase as we prepare for our commercial launch. We continue to anticipate our cash runway to extend into the second half of 2026. We remain focused on running a very capital efficient business, with tight management of our expenses while making the investments necessary to drive our scientific progress forward. Looking ahead, we are confident that we are strongly positioned to execute our strategy sufficiently to launch our game-changing Proteome Analysis Platform.
With that, I'll turn it back to Sujal
Sujal Patel: Thanks, Anna. To wrap things up, we continue to make solid progress against our development and business goals. And for that, I want to thank the entire Nautilus team. We're excited about what's to come, and we look forward to providing additional updates on our next call. With that, I’m happy to open the call up for questions. Operator?
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