AbCellera Reports Full Year 2023 Business Results

February 20, 2024
  • Total revenue of $38 million, compared to $485 million in FY 2022
  • Total cumulative partner-initiated program starts with downstreams of 87, with 12 new starts in the year
  • Net loss of $0.51 per share on a basic and diluted basis, compared to earnings of $0.56 (basic) and $0.50 (diluted) per share in 2022

AbCellera (Nasdaq: ABCL) today announced financial results for the full year 2023. All financial information in this press release is reported in U.S. dollars, unless otherwise indicated.

“In 2023 we began shifting capital allocation from building capabilities to using them, which includes advancement of our first internal programs and strategic partnerships,” said Carl Hansen, Ph.D., founder and CEO of AbCellera. “We are in the final stages of building our platform. We exited the year with approximately $1 billion in available liquidity and are well-positioned to execute on our strategy.”

FY 2023 Business Summary

  • Earned $38.0 million in total revenue.
  • Generated a net loss of $146.4 million, compared to net earnings of $158.5 million in 2022.
  • Reached a cumulative total of 87 partner-initiated program starts with downstreams.
  • Reporting the advancement of five additional molecules in the clinic, bringing the cumulative total to thirteen molecules to have reached the clinic.
  • Advanced two AbCellera-led programs into IND-enabling studies.

Key Business Metrics

Cumulative Metrics

December 31, 2022

December 31, 2023

Change %

Number of discovery partners

40

46

15 %

Programs under contract

174

203

17 %

Partner-initiated program starts with downstreams*

75

87

16 %

Molecules in the clinic

8

13

63 %

 

* Metric adjusted from prior reporting

AbCellera reached a cumulative total of 203 programs under contract (up from 174 on December 31, 2022) that are either completed, in progress, or under contract with 46 different partners as of December 31, 2023 (up from 40 on December 31, 2022). AbCellera started discovery on an additional twelve partner-initiated programs with downstreams to reach a cumulative total of 87 partner-initiated program starts with downstreams in 2023 (up from 75 on December 31, 2022). AbCellera’s partners have advanced a cumulative total of thirteen molecules into the clinic (up from eight on December 31, 2022).

Discussion of FY 2023 Financial Results

  • Revenue – Total revenue was $38.0 million, compared to $485.4 million in 2022. The partnership business generated research fees of $35.6 million, compared to $40.8 million in 2022. Licensing revenue was $1.0 million.
  • Research & Development (R&D) Expenses – R&D expenses were $175.7 million, compared to $107.9 million in 2022, reflecting growth in program execution, platform development, and investments in internal programs.
  • Sales & Marketing (S&M) Expenses – S&M expenses were $14.2 million, compared to $11.3 million in 2022.
  • General & Administrative (G&A) Expenses – G&A expenses were $61.0 million, compared to $55.5 million in 2022.
  • Net Loss – Net loss of $146.4 million, or $(0.51) per share on a basic and diluted basis, compared to net earnings of $158.5 million, or $0.56 and $0.50 per share on a basic and diluted basis, respectively, in 2022.
  • Liquidity – $787.9 million of total cash, cash equivalents, and marketable securities, including restricted cash.

Q4 Highlights and Financial Results

  • Advanced two internal programs into IND-enabling studies, ABCL635 and ABCL575.
  • Started three partner-initiated programs with downstreams.
  • Reporting the advancement of three additional molecules by partners into the clinic.

Revenue for the fourth quarter of 2023 was $9.2 million, representing 24% of total revenue for 2023. $8.7 million was generated from research fees, representing 25% of the total research fees for 2023.

Operating expenses totaled $75.2 million in the fourth quarter, or 27% of the total for 2023, and included investments made in co-development and internal programs.

The net loss for the fourth quarter was $47.2 million, or $(0.16) per share, on a basic and diluted basis.

Conference Call and Webcast

AbCellera will host a conference call and live webcast to discuss these results today at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time).

The live webcast of the earnings conference call can be accessed on the Events and Presentations section of AbCellera’s Investor Relations website. A replay of the webcast will be available through the same link following the conference call.

About AbCellera Biologics Inc.

AbCellera is breaking the barriers of conventional antibody discovery to bring better medicines to patients, sooner. AbCellera’s engine integrates expert teams, technology, and facilities with the data science and automation needed to propel antibody-based medicines from target to clinic in nearly every therapeutic area with precision and speed. AbCellera provides innovative biotechs and leading pharmaceutical companies with a competitive advantage that empowers them to move quickly, reduce cost, and tackle the toughest problems in drug development. For more information, please visit www.abcellera.com.

Definition of Key Business Metrics

We regularly review the following key business metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections, and make strategic decisions. We believe that the following metrics are important to understand our current business. These metrics may change or may be substituted for additional or different metrics as our business develops. Information on changes is set forth in our Annual Report on Form 10-K for the year ended December 31, 2023.

Number of discovery partners represents the unique number of partners with whom we have executed partnership contracts. We view this metric as an indication of the competitiveness of our engine and our level of market penetration. The metric also relates to our opportunities to secure programs under contract.

Programs under contract represent the number of antibody development programs that are under contract for delivery of discovery research activities. A program under contract is counted when a contract is executed with a partner under which we commit to discover or deliver antibodies against one selected target. A target is any relevant antigen for which a partner seeks our support in developing binding antibodies. We view this metric as an indication of commercial success and technological competitiveness. It further relates to revenue from access fees. The cumulative number of programs under contract with downstream participation is related to our ability to generate future revenue from milestone payments and royalties.

Partner-initiated program starts with downstreams represent the number of unique partner-initiated programs where we stand to participate financially in downstream success for which we have commenced the discovery effort. The discovery effort commences on the later of (i) the day on which we receive sufficient reagents to start discovery of antibodies against a target and (ii) the day on which the kick-off meeting for the program is held. We view this metric as an indication of the selection and initiation of projects by our partners and the resulting potential for near-term payments. Cumulatively, partner-initiated program starts with downstream participation indicate our total opportunities to earn downstream revenue from milestone fees and royalties (or royalty equivalents) in the mid- to long-term.

Molecules in the clinic represent the count of unique molecules for which an Investigational New Drug, or IND, New Animal Drug, or equivalent under other regulatory regimes, application has reached "open" status or has otherwise been approved based on an antibody that was discovered either by us or by a partner using licensed AbCellera technology. Where the date of such application approval is not known to us, the date of the first public announcement of a clinical trial will be used for the purpose of this metric. We view this metric as an indication of our near- and mid-term potential revenue from milestone fees and potential royalty payments in the long term.

AbCellera Forward-Looking Statements

This press release contains forward-looking statements, including statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements are based on management’s current beliefs and assumptions and on information currently available to management. All statements contained in this release other than statements of historical fact are forward-looking statements, including statements regarding our ability to develop, commercialize and achieve market acceptance of our current and planned products and services, our research and development efforts, and other matters regarding our business strategies, use of capital, results of operations and financial position, and plans and objectives for future operations.

In some cases, you can identify forward-looking statements by the words “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. These statements involve risks, uncertainties and other factors that may cause actual results, levels of activity, performance, or achievements to be materially different from the information expressed or implied by these forward-looking statements. These risks, uncertainties and other factors are described under “Risk Factors,” “Management's Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in the documents we file with the Securities and Exchange Commission from time to time. We caution you that forward-looking statements are based on a combination of facts and factors currently known by us and our projections of the future, about which we cannot be certain. As a result, the forward-looking statements may not prove to be accurate. The forward-looking statements in this press release represent our views as of the date hereof. We undertake no obligation to update any forward-looking statements for any reason, except as required by law.

 

AbCellera Biologics Inc.

Consolidated Statements of Income (Loss) and Comprehensive Income (Loss)

(All figures in U.S. dollars. Amounts are expressed in thousands except share and per share data.)

 

 

Year ended December 31,

 

 

2021

 

 

2022

 

 

2023

 

Revenue:

 

 

 

Research fees

$

19,076

 

$

40,802

 

$

35,556

 

Licensing revenue

 

20,778

 

 

696

 

 

969

 

Milestone payments

 

8,000

 

 

900

 

 

1,500

 

Royalty revenue

 

327,349

 

 

443,026

 

 

 

Total revenue

 

375,203

 

 

485,424

 

 

38,025

 

Operating expenses:

 

 

 

Royalty fees

 

45,516

 

 

66,436

 

 

 

Research and development(1)

 

62,062

 

 

107,879

 

 

175,658

 

Sales and marketing(1)

 

6,913

 

 

11,270

 

 

14,180

 

General and administrative(1)

 

41,848

 

 

55,485

 

 

60,999

 

Depreciation, amortization, and impairment

 

14,451

 

 

27,843

 

 

24,395

 

Total operating expenses

 

170,790

 

 

268,913

 

 

275,232

 

Income (loss) from operations

 

204,413

 

 

216,511

 

 

(237,207

)

Other (income) expense

 

 

 

Interest (income)

 

(3,330

)

 

(16,079

)

 

(42,247

)

Grants and incentives

 

(17,486

)

 

(10,554

)

 

(14,155

)

Other

 

6,080

 

 

4,045

 

 

(6,776

)

Total other (income)

 

(14,736

)

 

(22,588

)

 

(63,178

)

Net earnings (loss) before income tax

 

219,149

 

 

239,099

 

 

(174,029

)

Income tax (recovery) expense

 

65,685

 

 

80,580

 

 

(27,631

)

Net earnings (loss)

$

153,464

 

$

158,519

 

$

(146,398

)

Foreign currency translation adjustment

 

280

 

 

(1,671

)

 

(329

)

Comprehensive income (loss)

$

153,744

 

$

156,848

 

$

(146,727

)

 

 

 

 

Net earnings (loss) per share attributable to common shareholders

 

 

 

Basic

$

0.56

 

$

0.56

 

$

(0.51

)

Diluted

$

0.48

 

$

0.50

 

$

(0.51

)

Weighted-average common shares outstanding

 

 

 

Basic

 

275,763,745

 

 

285,056,606

 

 

289,166,486

 

Diluted

 

318,294,236

 

 

314,827,255

 

 

289,166,486

 

 

(1) Exclusive of depreciation, amortization, and impairment

 

AbCellera Biologics Inc.

Consolidated Balance Sheet

(All figures in U.S. dollars. Amounts are expressed in thousands except share data.)

 

 

December 31, 2022

December 31, 2023

Assets

 

 

Current assets:

 

 

Cash and cash equivalents

$

386,535

 

$

133,320

 

Marketable securities

 

499,950

 

 

627,265

 

Total cash, cash equivalents, and marketable securities

 

886,485

 

 

760,585

 

Accounts and accrued receivable

 

38,593

 

 

30,590

 

Restricted cash

 

25,000

 

 

25,000

 

Other current assets

 

75,413

 

 

55,810

 

Total current assets

 

1,025,491

 

 

871,985

 

Long-term assets:

 

 

Property and equipment, net

 

217,255

 

 

287,696

 

Intangible assets, net

 

131,502

 

 

120,425

 

Goodwill

 

47,806

 

 

47,806

 

Investments in and loans to equity accounted investees

 

72,522

 

 

65,938

 

Other long-term assets

 

46,331

 

 

94,244

 

Total long-term assets

 

515,416

 

 

616,109

 

Total assets

$

1,540,907

 

$

1,488,094

 

Liabilities and shareholders' equity

 

 

Current liabilities:

 

 

Accounts payable and other liabilities

$

52,497

 

$

49,580

 

Contingent consideration payable

 

44,211

 

 

50,475

 

Deferred revenue

 

21,612

 

 

18,958

 

Total current liabilities

 

118,320

 

 

119,013

 

Long-term liabilities:

 

 

Operating lease liability

 

76,675

 

 

71,222

 

Deferred revenue

 

19,516

 

 

8,195

 

Deferred government contributions

 

40,801

 

 

95,915

 

Contingent consideration payable

 

16,054

 

 

4,913

 

Deferred tax liability

 

33,178

 

 

30,612

 

Other long-term liabilities

 

3,086

 

 

5,906

 

Total long-term liabilities

 

189,310

 

 

216,763

 

Total liabilities

 

307,630

 

 

335,776

 

Commitments and contingencies

 

 

Shareholders' equity:

 

 

Common shares: no par value, unlimited authorized shares at December 31, 2022 and December 31, 2023: 286,851,595 and 290,824,970 shares issued and outstanding at December 31, 2022 and December 31, 2023, respectively

 

734,365

 

 

753,199

 

Additional paid-in capital

 

74,118

 

 

121,052

 

Accumulated other comprehensive income (loss)

 

(1,391

)

 

(1,720

)

Accumulated earnings

 

426,185

 

 

279,787

 

Total shareholders' equity

 

1,233,277

 

 

1,152,318

 

Total liabilities and shareholders' equity

$

1,540,907

 

$

1,488,094

 

 

AbCellera Biologics Inc.

Consolidated Statement of Cash Flows

(Expressed in thousands of U.S. dollars.)

 

 

December 31, 2021

December 31, 2022

December 31, 2023

Cash flows from operating activities:

 

 

 

Net earnings (loss)

$

153,464

 

$

158,519

 

$

(146,398

)

Cash flows from operating activities:

 

 

 

Depreciation of property and equipment

 

4,403

 

 

8,953

 

 

12,758

 

Amortization and impairment of intangible assets

 

10,062

 

 

18,890

 

 

11,637

 

Amortization of operating lease right-of-use assets

 

2,785

 

 

5,259

 

 

6,499

 

Stock-based compensation

 

30,646

 

 

49,481

 

 

64,183

 

Deferred tax (expense) recovery

 

(2,018

)

 

(2,114

)

 

1,960

 

Change in fair value of contingent consideration and investments

 

2,284

 

 

3,091

 

 

(8,018

)

Other

 

1,286

 

 

5,456

 

 

277

 

Changes in operating assets and liabilities:

 

 

 

Research fee and grant receivable

 

(37,386

)

 

(22,715

)

 

(45,933

)

Accrued royalties receivable

 

59,864

 

 

129,171

 

 

9,273

 

Income taxes (payable) receivable

 

(13,530

)

 

(88,609

)

 

30,464

 

Accounts payable and other liabilities

 

(3,237

)

 

(2,094

)

 

(15,104

)

Deferred revenue

 

8,624

 

 

6,183

 

 

(13,976

)

Deferred grant income

 

30,718

 

 

9,264

 

 

39,521

 

Other assets

 

(3,381

)

 

(1,375

)

 

8,980

 

Net cash provided by (used in) operating activities

 

244,584

 

 

277,360

 

 

(43,877

)

Cash flows from investing activities:

 

 

 

Purchases of property and equipment

 

(58,452

)

 

(70,660

)

 

(76,947

)

Purchase of intangible assets

 

 

 

(2,000

)

 

(560

)

Purchase of marketable securities

 

(274,710

)

 

(763,982

)

 

(1,021,510

)

Proceeds from marketable securities

 

27,608

 

 

510,631

 

 

910,937

 

Receipt of grant funding

 

32,621

 

 

16,434

 

 

25,311

 

Acquisitions

 

(11,457

)

 

 

 

 

Long-term investments and other assets

 

(17,534

)

 

(17,369

)

 

(44,649

)

Investment in and loans to equity accounted investees

 

(30,323

)

 

(25,679

)

 

(13,690

)

Net cash used in investing activities

 

(332,247

)

 

(352,625

)

 

(221,108

)

Cash flows from financing activities:

 

 

 

Payment of liability for in-licensing agreement, contingent consideration, and other

 

(9,373

)

 

(4,383

)

 

(1,234

)

Proceeds from long-term liabilities and exercise of stock options

 

5,487

 

 

2,755

 

 

11,590

 

Net cash provided by (used in) financing activities

 

(3,886

)

 

(1,628

)

 

10,356

 

Effect of exchange rate changes on cash and cash equivalents

 

(1,425

)

 

(9,599

)

 

589

 

Decrease in cash and cash equivalents

 

(92,974

)

 

(86,492

)

 

(254,040

)

Cash and cash equivalents and restricted cash, beginning of period

 

594,116

 

 

501,142

 

 

414,650

 

Cash and cash equivalents and restricted cash, end of period

$

501,142

 

$

414,650

 

$

160,610

 

Restricted cash included in other assets

 

 

 

3,115

 

 

2,290

 

Total cash, cash equivalents, and restricted cash shown on the balance sheet

$

501,142

 

$

411,535

 

$

158,320

 

Supplemental disclosure of non-cash investing and financing activities

 

 

 

Property and equipment in accounts payable

 

5,397

 

 

5,868

 

 

13,625

 

Right-of-use assets obtained in exchange for operating lease obligation

 

36,638

 

 

50,694

 

 

1,199

 

 

Inquiries



Media: Kathleen Reid; media@abcellera.com, +1(604)724-1242

Business Development: Murray McCutcheon, Ph.D.; bd@abcellera.com, +1(604)559-9005

Investor Relations: Melanie Solomon; ir@abcellera.com, +1(778)729-9116

Source: AbCellera Biologics Inc.