Abcellera reports full year 2020 business results
Vancouver, british columbia--(business wire)--abcellera (nasdaq: abcl), a technology company with a centralized operating system for next-generation antibody discovery, today announced financial results for the full year 2020 with the following highlights. “abcellera had a breakthrough year, demonstrating strong growth across every area of the business and the effectiveness of our technology and business model through our discovery of the first monoclonal antibody therapy for covid-19,” said carl hansen, ph.d., president and ceo of abcellera. “each program improves our platform, and we continue to invest in new technologies that enhance and expand our capabilities to discover high-quality, potent antibodies for our partners. with our strong cash position, profitability, and cash generation, we are aggressively executing on building our centralized operating system to help bring new antibody therapies to patients faster and more efficiently.” 2020 business highlights strong financial performance led by $233 million in total revenue, including $213 million in milestones and royalties. generated $119 million in net earnings, up from a $2 million loss in 2019. expanded partnership business to 103 cumulative programs under contract with 27 partners generating $20 million in research fees (71% growth over $12 million in 2019). established strong liquidity position with approximately $720 million raised from gross equity financings ($75 million series a2, $90 million convertible note, and $555 million ipo proceeds), and $23 million in positive cash flow from operations to end the year with $594 million in cash and cash equivalents, and $212 million in accrued accounts receivable. abcellera’s strong cash position will be used to build capacity, expand platform capabilities, and pursue business development initiatives. secured $126 million from the government of canada for future infrastructure investments, including cmc and gmp manufacturing capabilities. acquired trianni for $90 million to add new capabilities that expand diversity and reduce program timelines by sourcing fully human antibodies from rodents. acquired the orthomab™ bispecific platform to integrate capabilities for engineering bispecific antibodies. achieved notable covid-19 program milestones, including bamlanivimab entering clinical trials and receiving authorization in 15 countries across north america, the european union, the middle east, and africa. announced the appointment of john montalbano and peter thiel to the board of directors. key business metrics2 as of december 31, 2020, abcellera had 103 discovery programs (up 72% from 60 in 2019) that are either completed, in progress, or under contract with 27 partners (up from 22 in 2019). abcellera has started discovery on a cumulative total of 52 of these programs (up from 43 in 2019). bamlanivimab, being developed by partner eli lilly and company (lilly), is the first antibody discovered by abcellera to have reached the clinic and commercial markets. bamlanivimab is the first monoclonal antibody therapy for covid-19 in the world to reach human testing and to be authorized for emergency use. year ended december 31, change metric 2019 2020 % number of discovery partners 22 27 23 % programs under contract, cumulative 60 103 72 % program starts, cumulative 43 52 21 % programs in the clinic - 1 n/m discussion of 2020 financial results year ended december 31, change 2019 2020 amount % (in thousands, except percentages) revenue research fees $ 11,612 $ 19,848 $ 8,236 71 % milestone payments - 15,000 15,000 n/a royalty revenue - 198,307 198,307 n/a total revenue $ 11,612 $ 233,155 $ 221,543 1908 % revenue - total revenue was $233.2 million in 2020, up 1,908% from $11.6 million in 2019. research fees increased by $8.2 million, or 71%, as a result of growth in our partnership business. the success of bamlanivimab generated our first milestone payments of $15.0 million and our first royalty revenue of $198.3 million. royalty fees - royalty fees to the national institutes of health, attributable entirely to royalty payments on bamlanivimab, were $27.1 million as compared to $0 in 2019. research & development (r&d) expenses - r&d expenses were $29.4 million in 2020, as compared to $10.1 million in 2019, reflecting investments in the technology platform and increased partnership activity. r&d expenses included non-recurring charges of $4.0 million for ipr&d related to the acquisition of the orthomab platform and $4.3 million related to liability classified options in connection with the company’s conversion to usd as functional currency. sales & marketing (s&m) expenses - s&m expenses were $3.8 million in 2020, as compared to $1.3 million in 2019, driven by an expansion of the team. general & administrative (g&a) expenses - g&a expenses were $11.9 million in 2020, as compared to $2.7 million in 2019, with the increase driven by investments to support the growth of the company and preparations to be a listed company, as well as non-recurring charges of $1.9 million supporting financing activities. net earnings - net earnings in 2020 were $118.9 million, or $0.53 per share and $0.45 per share on a basic and diluted basis, respectively, as compared to a net loss of $2.2 million, or $0.01 per share on both a basic and diluted basis in 2019. liquidity - abcellera ended 2020 with $594.1 million of cash and cash equivalents and $212.3 million in accrued accounts receivable, most of which have subsequently been received. abcellera ended the year with $2.4 million in debt from a government of canada zero interest repayable funding program. the company retired all other debt agreements in the year and incurred a non-recurring $4.2 million expense charge for interest and cancellation fees for early retirement. conference call and webcast abcellera will host a conference call and live webcast to discuss these results today at 2:00 p.m. pacific daylight time (5:00 p.m. eastern daylight time). the live webcast of the earnings conference call can be accessed on the events and presentations section of abcellera’s investor relations website at https://investors.abcellera.com. a replay of the webcast will be available through the same link following the conference call. about abcellera biologics inc. abcellera is a technology company that searches, decodes, and analyzes natural immune systems to find antibodies that its partners can develop into drugs to prevent and treat disease. abcellera partners with drug developers of all sizes, from large pharmaceutical to small biotechnology companies, empowering them to move quickly, reduce costs, and tackle the toughest problems in drug development. to learn more, please visit us at 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. for example, as our business matures and to the extent programs are discontinued, we anticipate updating these metrics to reflect such changes. 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 technology stack and our current 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 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 technology 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. program starts represent the number of unique programs under contract 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 our operational capacity to execute on programs under contract. it is also an indication of the selection and initiation of discovery projects by our partners and the resulting near-term potential to earn research fees. cumulatively, program starts with downstream participation indicate our total opportunities to earn downstream revenue from milestone fees and royalties in the mid- to long-term. programs in the clinic represent the count of unique programs for which an investigational new drug, or ind, new animal drug or pre-market approval, or pma, application, or equivalents under other regulatory regimes, has been filed based on an antibody that was discovered by us. where the date of such application is not known to us, the date of the first public announcement of clinical trials will be used instead 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 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. condensed consolidated statement of operations (expressed in thousands of u.s. dollars except share and per share data) 2019 2020 revenue research fees $ 11,612 $ 19,848 milestone payments - 15,000 royalty revenue - 198,307 total revenue 11,612 233,155 operating expenses royalty fees - 27,143 research and development3 10,113 29,393 sales and marketing3 1,263 3,842 general and administrative3 2,749 11,910 depreciation and amortization 1,604 4,836 total operating expenses 15,729 77,124 income (loss) from operations (4,117 ) 156,031 other (income) expense interest income (155 ) (293 ) interest and other expense 209 6,511 foreign exchange (gain) loss (186 ) 300 grants and incentives (1,774 ) (8,320 ) total other (income) expense (1,906 ) (1,802 ) net earnings (loss) before income tax (2,211 ) 157,833 provision for income tax - 38,915 net earnings (loss) and comprehensive income (loss) for the period $ (2,211 ) $ 118,918 net earnings (loss) per share to common shareholders basic $ (0.01 ) $ 0.53 diluted $ (0.01 ) $ 0.45 weighted-average common shares outstanding basic 151,327,560 159,195,023 diluted 151,327,560 263,129,765 abcellera biologics inc. condensed consolidated balance sheet (expressed in thousands of u.s. dollars except share data) december 31, 2019 december 31, 2020 assets current assets cash and cash equivalents $ 7,553 $ 594,116 accounts receivable 2,124 903 accrued accounts receivable 1,152 212,336 other current assets 1,811 5,970 total current assets 12,640 813,325 long term assets property and equipment, net 8,480 17,923 intangible assets - 115,153 goodwill - 31,500 equity investee - 19,247 other long-term assets 585 8,388 loans to related parties 1,783 - total long-term assets 10,848 192,211 total assets $ 23,488 $ 1,005,536 liabilities and shareholders' equity current liabilities accounts payable and accrued liabilities $ 2,579 $ 20,005 current portion of contingent consideration payable - 13,411 income taxes payable - 36,152 accrued royalties payable - 27,143 deferred revenue 3,236 6,589 current portion of long-term debt 2,080 190 total current liabilities 7,895 103,490 long-term liabilities operating lease liability 2,642 3,715 long-term debt 1,363 2,198 deferred revenue and grant funding 1,336 25,894 contingent consideration payable - 9,148 deferred tax liability - 26,161 other long-term liabilities - 4,422 total long-term liabilities 5,341 71,538 total liabilities $ 13,236 $ 175,028 shareholders' equity common shares: no par value, unlimited authorized shares at december 31, 2019 and 2020: 151,681,382 and 269,497,768 shares issued and outstanding at december 31, 2019 and 2020 respectively 5,122 710,387 convertible preferred shares unlimited authorized shares at december 31, 2019 and 2020: 2,105,264 and nil issued and outstanding at december 31, 2019 and 2020 respectively 7,546 - additional paid-in capital 2,300 5,919 accumulated earnings (deficit) (4,716 ) 114,202 total shareholders' equity 10,252 830,508 total liabilities and shareholders' equity $ 23,488 $ 1,005,536 abcellera biologics inc. condensed consolidated statement of cash flows (expressed in thousands of u.s. dollars) 2019 2020 cash flows from operating activities: net income (loss) $ (2,211 ) $ 118,918 cash flows from operating activities depreciation of property and equipment 1,604 2,317 amortization of intangible assets - 2,519 amortization of operating lease right-of-use-assets 243 435 stock-based compensation 890 8,397 extinguishment of long-term debt - 3,700 accretion and other 194 830 deferred tax expense - 2,098 unrealized foreign exchange gains and losses - 177 changes in operating assets and liabilities accounts and accrued research fees receivable (1,803 ) (5,467 ) accrued royalties receivable - (197,553 ) investment tax credit receivable 1,593 - income taxes payable - 36,412 accounts payable and accrued liabilities 150 6,601 operating lease liabilities 2,784 (350 ) deferred revenue (6 ) 21,810 accrued royalties payable - 27,143 other operating assets and liabilities (744 ) (5,297 ) net cash provided by operating activities 2,694 22,690 cash flows from investing activities purchases of property and equipment (3,997 ) (9,673 ) purchase of intangible assets - (5,000 ) repayment (issuance) of related party loans (1,783 ) 1,783 acquisition of trianni - (87,643 ) investment in equity investees - (19,247 ) net cash used in investing activities (5,780 ) (119,780 ) cash flows from financing activities repayment of long-term debt (399 ) (19,942 ) proceeds from long-term debt 193 15,490 proceeds from convertible debentures - 89,990 short-term borrowings 387 (387 ) issuance of common shares pursuant to exercise of stock options 25 1,000 net proceeds from issuance of common shares - 522,840 proceeds from issuance of preferred shares - series a1 financing (11 ) - proceeds from issuance of preferred shares - series a2 financing - 74,662 net cash provided by financing activities $ 195 $ 683,653 increase (decrease) in cash and cash equivalents (2,891 ) 586,563 cash and cash equivalents, beginning of year 10,444 7,553 cash and cash equivalents, end of year $ 7,553 $ 594,116 1 all financials are reported in usd. 2 see definitions of key business metrics 3 exclusive of depreciation and amortization source: abcellera biologics inc.
