Release Date: August 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Accelerate Diagnostics Inc (AXDX, Financial) successfully completed a preclinical trial for its WAVE platform, achieving approximately 95% central and categorical agreement across 20 antibiotics.
- The WAVE platform offers same shift results in 4.5 hours on average, which is unmatched by current emerging AST platforms.
- The company has secured additional funding to support operations through 2025, allowing focus on achieving critical WAVE operational and development milestones.
- Approximately 75% of the US customer base is signed to longer-term contracts ahead of the WAVE commercial launch.
- Significant reductions in operating expenses and cash burn have been achieved, with a target to further reduce operating cash burn to about $5 million.
Negative Points
- Net sales for the quarter were approximately $3 million, showing only a slight increase from $2.9 million in the same period the prior year.
- Gross margin declined to approximately 23% from 27% in the prior year, driven by product mix.
- The company reported a net loss of approximately $11.6 million for the quarter.
- Cash used for the quarter was approximately $8.7 million, including notable one-time and nonrecurring payments.
- There is a reliance on achieving further critical WAVE milestones and securing FDA clearance to ensure future success and partnerships.
Q & A Highlights
Q: What levels of central agreement and categorical agreement are needed to drive uptake in the rapid AST field, and what results should be expected from the clinical trial?
A: Jack Phillips, President and CEO, stated that the FDA requires a performance above 89.9% for approval. The preclinical trial showed performance in the mid-90s, which gives confidence for a successful clinical trial.
Q: Can you provide more details on the decision to focus on achieving milestones before working with a strategic partner?
A: Jack Phillips explained that securing funding through 2025 allows the company to conduct clinical trials and seek FDA clearance for the WAVE system. This strategy is believed to maximize value for stakeholders, and ongoing discussions with strategic partners will continue.
Q: What is the current cash balance, and how does it support funding through 2025?
A: David Patience, CFO, indicated that the cash balance is in the mid-$25 million range. Significant cost-cutting initiatives have been implemented, and the goal is to reduce operating cash burn to about $5 million. Contractual obligations from partnerships will also provide cash inflows.
Q: How have the preclinical trial results impacted conversations with strategic partners?
A: Jack Phillips noted that the unique capabilities of the WAVE platform have generated interest from strategic partners. The successful preclinical trial results have strengthened the company's position in discussions with these partners.
Q: What are the key financial results for Q2 2024?
A: David Patience reported net sales of approximately $3 million, a gross margin of 23%, and a net loss of $11.6 million. The company is focused on reducing operating expenses and cash burn while achieving key milestones for the WAVE program.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
