Berkeley Lights, Inc.
Q1 2021 Earnings Call Transcript
Published:
- Operator:
- Good day and thank you for standing by. Welcome to the Berkeley Lightsโ First Quarter 2021 Earnings Conference Call. I will now like to hand the conference over to your speaker today, Carrie Mendivil. Please go ahead.
- Carrie Mendivil:
- Thank you. Earlier today, Berkeley Lights released financial results for the quarter ended March 31, 2021. If you have not received this news release or if you'd like to be added to the company's distribution list, please send an e-mail to ir@berkeleylights.com. Joining me today from Berkeley Lights are Eric Hobbs, Chief Executive Officer; and Kurt Wood, Chief Financial Officer.
- Eric Hobbs:
- Thanks, Carrie, and thank you, everyone, for joining us this afternoon. We started the year off strong and had solid execution across our business during the first quarter. Revenue grew 35% year-over-year to $18.6 million. I'm very pleased by the performance of our team this quarter and encouraged by the increasing demand and enthusiasm we are receiving from our customers. At Berkeley Lights, we focus on major markets that leverage cells to make products which include antibody therapeutics, cell therapy, synthetic biology, and most recently gene therapy. To truly enable the growth of these markets, one needs to rapidly assess the relevant functions hidden in the large numbers of sequences produced daily. Linking the genome to the desired phenotype at scale is at the heart of our technology. This is extremely important to our customers as it increases their probability of success and leads to an accelerated time to market. These functional tests become even more essential as the complexity of the end product increases. Multi-dimensional tests and parameter optimization sequences by themselves have limited value and are not actionable unless a particular sequence in a cell is shown to create a valuable product such as a cure for a disease, an enzyme, or a food protein. At Berkeley Lights we are bringing functionally validated sequences and cells to life at an unprecedented scale, speed and resolution.
- Kurt Wood:
- Thanks, Eric. Revenue for the three months ended March 31, 2021 increased 35% year-over-year to $18.6 million with $13.5 million coming from product revenue and $5.1 million from service revenue. Looking at our three revenue streams, direct platform sales totaled $11.1 million in the first quarter of 2021, increasing 18% over the prior year period.
- Eric Hobbs:
- Thanks, Kurt. We started the year with strong platform placements, continue to expand opportunities in our existing markets and grew our total addressable market. At Berkeley Lights, we envision a future where sales are scalable and sustainable way to manufacture the products that we need to live a long and healthy life. The Berkeley Lights platform is key to enabling this by providing precise, rapid discovery and functional validation of biology. As we look ahead in 2021, I'm more bullish than ever about the opportunities in front of us. And I'm confident that we are well positioned to execute our strategy to transform the market for cell-based products this year and beyond. With that, we'll now open up to questions. Operator?
- Operator:
- Thank you. And our first question comes from Doug Schenkel with Cowen. Your line is now open.
- Doug Schenkel:
- Hey, good morning, everybody. So just a couple of financial questions of the 10 placements in the quarter. How many were Beacon versus Lightning and what was the mix of subscription placements in the quarter?
- Kurt Wood:
- Hey, thanks for the call or for the question, I appreciate it. We don't disclose the breakout between Beacon and Lightning. Obviously, it was majority of Beacon. And then from a subscription standpoint, we had one subscription in the quarter.
- Doug Schenkel:
- Okay. So I guess a couple of questions building off of the subscriptions. I'm doing some quick math here. So, yes, that's always a little bit dangerous, but I think it's simple enough where it does look like the ASP on Beacons assuming, yes, if I just say, hey, nine of the 10 or vast majority were Beacon and just divide that into your instrument revenue. It does seem like ASPs were down. So if I have that right why is that? And then more generally going back to when you started the subscription program, I think we had collectively meaning the company and the investment community, higher aspirations for the impact of the existing subscription program. What do you think hasn't worked there as well, and maybe in a little bit more detail, why does the new programs put you in a better position to essentially lower the bar to adoption here and hopefully get you to that 45 placements this year?
- Eric Hobbs:
- So Doug, I'll โ this is Eric. I'll answer the second question first, and then Kurt can come in on the other one, right. We look at the overall market for the Berkeley Lights platform. And one of the things that we found when we rolled out the first subscription is that, although it provided our customers with access with the full access to the Beacon, that there were still a larger subset of customers, which could leverage a different level of capacity on the Berkeley Lights' Beacon. And what we wanted to do was to make it as easy as possible for our customers to access our technology. And so, by offering this newer subscription on alternative access model, it accommodates our customers through this approach. Now, as I mentioned, initially, their approach was focused on financing, which essentially provided customers again to the full access. But the new subscription model better meets their specific capacity needs. And in this model, our customers are going to subscribe to a given capacity and it's all inclusive of consumable software service and support for their cell line development or antibody discovery campaigns. And I think when you place yourself in the shoes of our customers in this space, they're really thinking about how do they execute their campaigns to serve their customers. And this newer subscription offering does exactly that. Does that help Doug answer that question on the newer model?
- Doug Schenkel:
- It does. And I guess, my only follow-up Eric was, would be, I mean, this seems like a smart way of essentially getting more people to use the platform with maybe less of a commitment. And I guess the hope would ultimately be that after more experience with Beacon, they would potentially use this more or making more long-term commitment. I want to make sure I'm thinking about that right. And then, kind of building off of that before, I know, Kurt answers the other question on ASPs. I am curious if any of this is in part motivated by competitive dynamics with folks who are not selling instruments, but instead are offering somewhat similar services.
- Eric Hobbs:
- Yes. It's not a competitive offering. It is in fact, we do see our customers โ our customers are doing incredible things with our platform Doug, and it's really exciting for me to see. And so the more people who have access to our technology, the more innovation, not only from Berkeley Lights but from our customers into some of these new markets that will gain traction and I think, as we continue to deploy and ramp our technology that customer base innovation is really important and it makes them part of the story as well. So it's for me, it's important to see our technologies continue to roll out a ramp in the market. And this new subscription is really tailored to the folks with a lower capacity need. So it's a sweet spot with what we're offering. And we do believe that it accelerates the access of that SAM, the serviceable available market, for that, and what we saw already, as you know, we've got good traction. We โ after that initial subscription, we took feedback from our customers, came up with this program and already in kind of the pilot we've gotten really strong interest in this. So we feel good about that.
- Doug Schenkel:
- Okay. That's great. And then Kurt on ASP, anything interesting there?
- Kurt Wood:
- Yes. I think what you might be missing is why we placed 10. What we mentioned in the call is two of those were essentially title transfers at zero dollar from the completion of a milestone agreement that we did. So, they were included in partnership revenue in the past. And upon the successful completion of the milestones, the title passed to them. So they'll bear the pull through on those tools going forward. But so really from a revenue generating aspect, there was eight tools in the quarter that were direct placements.
- Doug Schenkel:
- Okay. And very last one and then I'll let others jump in here. Just looking at the funding environment in terms of company access to capital. There certainly seems like there's been no slowdown in the pace of investment. And for that matter innovation in the field of cell therapy, is that changing the mix of demand that you're seeing? I mean, I'm not necessarily saying that this is a huge change from trend, but I am curious if, there's a pickup in interest from emerging players are on the flip side, maybe CDMO interest is as strong as ever. I guess, at a high level what I'm asking is, where are you seeing the most interest over the last three months and is the mix of backlog in terms of customer profile evolving at all, relative to where we were last year.
- Eric Hobbs:
- Yes, Doug, in the cell therapy space, we continue to see demand for functional validation of the therapeutic entities that the customers are creating, and whether that's cell therapies or MRNA therapies, right. Understanding that those therapeutics are having the function, which is intended by the designer, right, to cure the diseases that they wanted to cure is really important for them. And to be able to see that function on patient samples in Berkeley Lights platform with just thousands of cells is fairly interesting to our customers. And so we'll continue to learn more about that particular market space and support those customers as we continue to evolve the capability of these different therapeutics.
- Doug Schenkel:
- Okay. Sounds good. All right. Thanks guys.
- Eric Hobbs:
- Thanks, Doug.
- Operator:
- Thank you. Our next question comes from Tycho Peterson with JPMorgan. Your line is now open.
- Tycho Peterson:
- Hey, thanks. Eric, maybe I'll start with the cell therapy manufacturing. I know, you placed your first alpha unit in the fourth quarter. Can you just talk a little bit about discussions with clinical customers? How we think about workflow development and just next steps?
- Eric Hobbs:
- Yes, absolutely, Tycho. Good morning. The โ so as we continue โ our team continues internally to make really good progress on the CTMS system. We've got an alpha unit now up and running, right, doing a process optimization on culture, integrating different assay. So, that's great to see the internal team continue to make great progress on the CTMS. And the discussions in the market are, how do we integrate those next generation assays? And what are the critical assays that our customers are looking for in this space? And certainly of course the site of toxicity assay that we have Tycho is as certainly gained interest for our customers. But we'll continue to move that forward again. I just want to remind everyone that in the cell therapy space, although it's a wonderfully exciting space, it also is one that has a longer burn as we get into the market on the timeline for that to start to generate revenue. But certainly progress is being made. And I'm very excited about what the team is doing inside the company right now.
- Tycho Peterson:
- Great. And then on the CDMO front, I know you talked about, I think a third of the placements where either CROs or CDMOs, on the back of your viral vector deal last quarter which is an interesting one, right? I think you started out trying to sell a system and turn into a $17 million deal. So can you just talk about whether there's been kind of follow on interest from others around viral vector production, similar type arrangements?
- Eric Hobbs:
- Yes, absolutely, Tycho. In this particular market, Berkeley Lights enabling stable, rapid generation of stable cell lines would be a game changer in the market. And so we have had additional discussions is about as far as I think I can disclose anything on the call. But we do have interest of course, people would love to do this. If we could โ the potential opportunity is if we could make stable cell lines very rapidly which we believe we can do then that would change the way that this particular market operates. And so, for us, it's very exciting because Tycho, an antibody therapeutics, Berkeley Lights has a wonderful solution for antibody discovery in cell line development, but make no mistake. We are better than โ it's a me better kind of a market, right? We're better than the competition in that space. In some of these other spaces, we may be the only solution in those spaces. And of course, for obvious commercial reasons, right, that has great interest to us. And so we're excited about some of these new markets that we're seeing as we continue to evolve our capabilities from our foundational markets into adjacent markets and future markets.
- Tycho Peterson:
- Okay. That's helpful. And then just to follow up on Doug's question on the new subscription model, can you give us a sense of the types of customers you're targeting with this kind of all in approach? Is there a particular customer class you're going after here?
- Eric Hobbs:
- Certainly, the customers who are using a lower capacity, smaller CROs, CDMOs are of particular interest. But it can also be large pharma companies who want to dip their toe in the water and try something first before they move on to a full purchase. And so, we do see a large market contingent in that customer base as Kurt mentioned with the larger several available market to us.
- Kurt Wood:
- And I think Tycho you're seeing a lot of โ go ahead.
- Tycho Peterson:
- No, no. Go ahead.
- Kurt Wood:
- You're seeing a lot of companies get funding that are starting out with their own biology, want to run it, but can't utilize the full capacity of a Beacon, hard to get that CapEx sale through. This provides an easy way for them to get in. And in some cases allows them to bypass an initial feasibility study because the hurdle smaller and they go right into being able to run campaigns very quickly in a cost effective differentiated way.
- Tycho Peterson:
- Okay. That's helpful. And then last one on Ginkgo, you talked about the workflows that you've kind of bought down. Can you just talk about timelines to commercialize those workflows?
- Eric Hobbs:
- We were still on track to deliver workflows to Gingko this year per previous discussions that we've had Tycho, the team continues to collectively these two teams are working together fantastically well. There's new innovations, there's new capabilities in the space that I'm extremely happy to see. And so, I continue to be happy about that's a good relationship and partnership between the two companies.
- Tycho Peterson:
- Okay. Thank you.
- Eric Hobbs:
- Thanks.
- Kurt Wood:
- Thanks.
- Operator:
- Thank you. Our next question comes from Brian Weinstein with William Blair. Your line is now open.
- Brian Weinstein:
- Hey guys. Good early morning to you out on the West Coast. So I guess of the 45 placements that are in your guide, excuse me, what is the mix that you guys are thinking between the different commercial models that you're expecting? In longer term, can you talk about what your expectations are as we think about revenue longer-term is to how these different commercial models will play in? I understand your gross margins are not changing, but how should we think about the way that you're planning around these subscription models longer term?
- Kurt Wood:
- Yes, appreciate the question. I think when we guided at least 45 placements, and in this year, the lower number of placements would correlate to the higher end of the guidance, because that would mean we're doing more CapEx sales. What we believe is the new subscription model, increases the SAM and increases the unit placements. So we would expect that to drive incremental unit placements. So you would have a higher incremental units, but there could be in the short term, some cannibalization rates for those customers that are on the fence of the capacity need that would trade off some of the revenue in the short term for a longer-term recurring aspect, a couple of ways to look at this. If you think about the subscription model of how we're pricing it over the five-year useful life of the tool, it's slightly accretive over the โ on a subscription on an absolute dollar basis. Obviously though, we expect not just to break even we drive that incremental demand that we're doing. So the real driver will be as the success of that is can we drive the incremental demand and units, and we feel we can under the subscription model for that. So I think as you look out in time as we place that more and more subscriptions, you're going to see more recurring revenue come off of that. Plus you obviously have off of the existing installed base on the CapEx sale of growing consumable run rate. You saw the jump in recurring year-over,-year this year as well. We would expect that to continue. It's obviously way too early for us to guide for 2022 and beyond. But we do anticipate that recurring base from both subscription and the growing installed base to be strong drivers of growth in the future. I will point out though, this new subscription plan unlike like the old one, it's all inclusive. It includes the consumables. It includes the tool. It includes the service and everything on that. So this really is an all in very simple sale process for us that allows them to run on a per campaign basis, all included.
- Brian Weinstein:
- Got it. Thank you for that. And then Eric, high-level question for you. I mean, you guys have announced a lot of stuff from a technology standpoint, a business model standpoint. If you take a step back, what are the kind of key drivers, two or three drivers that you're looking at when you think about how this business is progressing? What are you looking at internally here to kind of monitor all this?
- Eric Hobbs:
- Yes, thanks, Brian. There are really three main drivers or catalysts for our business. And the first is to grow the opportunity in, and we've talked about that through business models, such as subscription, but also with business development in regards to viral vectors. The second thing we are doing is expanding our biology and technology offerings. These are the new workflows, the new capabilities that we talk about. CTMS and Antibody Discovery 4.0. And the third thing we're really working on is building our corporate capabilities. So, in addition to doing sales, and marketing, and business development, which we talked about also building biology or apps dev and even into infrastructure such as our finance organization team. And those are really the three things that are driving โ overall those are the three drivers for our business as we move forward.
- Brian Weinstein:
- Got it. Thanks for that. And if I can squeeze one more in here, we get a lot of questions about competitive dynamics and whatnot. And I know that you just addressed that the change in the commercial model was not related to competitive dynamics and I appreciate that. What are you seeing competitively at this point in terms of other systems that are out there, obviously there's some that are more high-profile than others, but can you just kind of give us an update on the competitive landscape and what you see relative to how your technology is stacking up against others at this point? Thank you.
- Eric Hobbs:
- Yes, absolutely, Brian. So, the thing that we see in the market is that we're learning is that Berkeley Lightsโ this functional validation or test is better than anybody else. And the relevances of that is that each and every biologic modality, whether it's antibody cell therapies, gene therapies and every gene sequence that's discovered, or cell line that's engineered each requires functional validation. And I believe it can be optimally performed on the Berkeleyโs platform. And so, for customers who are looking to accelerate their business, to discover development, to manufacture whether any cell-based products, all roads ultimately will lead to Berkeley Lights. And so I feel very strong about how we're positioned in the market right now. We'll continue to release capabilities to build our capabilities so that our customers are able to do the job that they need to do with their products.
- Brian Weinstein:
- Thank you.
- Eric Hobbs:
- Thanks, Brian.
- Operator:
- Thank you. Our next question comes from Tejas Savant with Morgan Stanley. Your line is now open.
- Tejas Savant:
- Hey guys. Good morning. So just one question on the service revenue looks like you came in decently higher than, than our model. And so, I was just curious as to what drove the uplift there. Obviously, you have the CDMO contract sort of working its way through the model, but in terms of how you're about amortizing that 17 million contribution, over the remainder of this year and then 2022 is there any sort of shift in revenue recognition thinking on that front?
- Eric Hobbs:
- I'd have to dig into your model a little bit more specifically to answer unique on your model. But from the partnership we're not seeing a change in the revenue recognition that we outlined earlier from the viral vector deal. We obviously announced that it's going into the next phase, we obviously had some revenue recognition for that in the first quarter, which is positive that arrangement is going extremely well. Eric mentioned the demand we're getting from others, inbound coming in, obviously nothing formalized to announce, but we are seeing a fair amount of traffic come in from that. So, we feel good about that. Consumable, recurring run rate is up. And the service type specifically line within the recurring, I would say was a normal seasonal pattern for us.
- Tejas Savant:
- Got it. And Kurt I want to go back to that comment you had made earlier in your prepared remarks around there's a certain degree to which we're expecting some of the direct installs to shift to the new subscription model here. Given your sort of subsequent remarks that the offering is essentially is tailored at folks with a lower capacity need, it allows them to bypass the initials or the feasibility studies, and so on, can you just walk us through why a customer who was potentially going to buy $1.5 million to $2 million Beacon would now pivot to this model? I can understand why the old subscription model might sort of result in some of those customers switching to more flexible sort of offering. But from a direct install perspective, can you just walk us through the dynamics there please?
- Kurt Wood:
- Yes, if you look at the lower capacities, obviously the more campaigns you are going to run on a tool, the more apps you are to purchase that tool and get the economies of scale there. But for some customers that have lower, let's say 10 or less type campaigns, they are probably going to consider and say, look there, do I want to spend the cash on that right now and can I get the return of doing that on it, or am I better off, entering into an all and exclusive relationship that doesn't have that same long-term commitment on there? And that's what we're seeing is a few folks that really see the value of it, but have that lower campaign capacity need that puts them on the cost. And it's actually those customers that generally have a longer sales cycle to begin with. So, this alleviates that constraint of a longer sales cycle, allows them to have a way to access the technology all in. And there's likely going to be some cannibalization, I think, it's a very low percentage of cannibalization, but you'll likely see some of that. And then the majority of the sales will be new incremental that we have. Does that answer your question?
- Tejas Savant:
- Got it. Yes, super helpful Kurt. And then a couple for you, Eric. Just in time, I think Tycho asked us around timelines for the Ginkgo workflow commercialization, I know you mentioned the partnership is on track and is working well, but over what timeframe should we expect that the workflow that you bought down to be commercialized across a broader customer set? And then any updates you can share on the expansion of the BioFoundry that you just completed in the UK and Asia? Just how that's translating into a customer inbounds, and pipelines in those geographies would be very helpful.
- Kurt Wood:
- Yes, continue to โ so let's answer the workflow question first, right. So the workflow question, we will release those later this year. And as we released those later this year, in Q4 in late Q4, then you'll start to see us commercialize these through 2022. Okay. On the BioFoundry labs, the labs in Asia-Pacific and in the European Union, we just โ it's great to see the pictures coming back for the team. The last few built, systems installed, working, running with customers in the market. In the Asia-Pacific area we have an upcoming, we'll have our second user group meeting this summer. So, looking forward to bringing customers together in APAC. And so, as things begin to open up in APAC, we see again recurring and strong interest in that space. And the demo lab in the European Union the tools were just installed, I think, two weeks ago. And so saw some pictures coming from Gareth over in Europe. So, those are moving forward. Again, running customer demos, customers love to see their biology operating on our system. So certainly, I do believe that's a great sales tool for our team members in these regions.
- Tejas Savant:
- Got it. Super helpful. Thanks guys.
- Operator:
- Thank you. Our next question comes from Dan Arias with Stifel. Your line is now open.
- Dan Arias:
- Good morning guys. Thank you. Eric, can you just expand a bit about how the lightning figures into the equation going forward? You've got the Beacon outright purchase and the Beacon subscription uptake. I'm just sort of curious where the sweet spot is for that system at this point.
- Eric Hobbs:
- Yes, so as everybody is aware, lightings are lower capacity, less automated way to access our technology. And, and we continue to play lightings in the quarter as well. And so, we see it's very interesting. We see some very interesting demand in the lighting space. In particular back to the question, I believe was asked by, Tycho, which is in the cell therapy space and understanding, taking samples from patients, before infusion of the cell therapy, and of course after infusion of the cell therapy. And I think there's a very good fit there for lightening in the cell therapy space, so we continue to release our cell therapy workflows in that space. And as we continue to move into the future, right, is there another access model for lightening, to be determined right now? We continue to see, like I said, in the academic space, some pretty strong, and building interest on using the lighting in the cell therapy space.
- Dan Arias:
- Okay. And then just maybe on the Beacon and the placements that you are making today versus say a year ago, are you seeing the validation and the ramp up period get shorter these days as labs get smarter, and you guys sort of get smarter at bringing customers up to speed? And do you think that that's something that can positively impact the pull through rate that you might see in say the first 12 months of ownership for a customer?
- Eric Hobbs:
- Well, I think the key, โ yes, so I think the key thing is Berkeley Lights continues to improve these workflows. And I do believe as we continue to develop and improve the workflows. We are going to see increase in recurrence. So, for example, Antibody Discovery 4.0 is great, because not only do we have the upfront sort of capability as we come into the microfluidic environment, but we're also enabling our customers to rapidly re-express their proteins, as they've discovered and all of this can be done in less than a week. And so, as we continue to turn the creek and improve these protocols, improve these workflows, they are coming up faster Dan for our customers. And I think that as our customers see the system โ they see computer-controlled biology in action, right. They tell their friends about it, hey, these tools come in, right. They wheel them in, they plug in, a couple of gas lines, power, and the Internet, and all of a sudden we're up and running antibody discovery workflows faster than we could ever run. And so that's very positive for our customers. I think it's also positive for the market. And as we continue to add capabilities, we'll continue to take more upstream and downstream capability into the Berkeley Lights workflow which will drive recurring revenues up.
- Dan Arias:
- Okay. One more for you and then I'll hop off on. On consumables utilization, how would you compare the increase in pull through when you just look at your anchor users, Amgen, Adverus, et cetera, to some of the new buyers? I mean, obviously the dollar amount is higher for the big-time customers. But I'm sort of just curious whether you are seeing a steady progression towards higher utilization across the board here when you look at the various types of customers?
- Eric Hobbs:
- You hit the nail on the head there, it kind of varies by segment that you go for. And then obviously, part of the subscription offering we're doing is for some of those customers that have lower campaign and consumable requirements. But when we look at a like-for-like basis, we actually saw a little bit of an uptick, year-over-year Q1 to Q1 on the customers that were in service. So similar to like a same-store sale type metric, we saw a slight uptick.
- Dan Arias:
- Okay. Thanks very much.
- Kurt Wood:
- Thanks, Eric.
- Operator:
- Thank you. Our next question comes from Paul Knight with KeyBank. Your line is open.
- Paul Knight:
- Hi Eric, are the academic customers more oriented to this second subscription model, or are they more of a lightening customer in your opinion?
- Eric Hobbs:
- Yes, certainly. So, the academics love to play, and they love to invent and they're coming up with great stuff Paul. So, they are more on the side of buying consumables, they'll buy their consumables, their reagents and they'll play into a new space. The new subscription offering is really โ it's a turnkey solution, right. Customers, I think, as Kurt had mentioned, smaller startups, a certain amount of money in the bank, right need to run, they need to run a number of campaigns. They know they need to execute those things in a timely manner to drive the value of their organization. And so really, because the new subscription includes the consumables, the service support, the software, et cetera, for running a given number of campaigns, I think, that's excellent in the commercial area. But the academics love to play in tinker so much that it wouldn't suit their needs, certainly not targeting them at this point in time with that subscription model.
- Paul Knight:
- And then the success you're seeing in Asia with 45% of sales in that market, what's driving that?
- Eric Hobbs:
- Yes, sure Paul. I mean, certainly, we saw Asia-Pacific come out of COVID earlier than the rest. So strong growth in the Asia-Pacific region is one due to their response to COVID. But additionally, the Asia-Pacific market is a market, is an emerging market. In an emerging market they don't have installed infrastructure in place that they have to forgo to move to a new technology. And so, they are rapidly adopting the Berkeley Lights technology as it's the fastest and most efficient way to get to the solutions and build their pipelines. And so new technology can make the biggest impact in emerging markets. And so, I believe that's another reason why we're seeing the rapid adoption of our platform in that space.
- Paul Knight:
- Is Opto Assure a contract manufacturing purchase or a contract research purchase?
- Eric Hobbs:
- So Opto Assure you'll see it used more in the CDMOs in our cell line development workflow. And Opto Assure, the first, that we've released with Opto Assure is the aggregation assay. And so, our customers need to know and understand whether the antibodies that they've engineered or discovered have this aggregation potential because these drugs just operate differently inside of patients. And so, it's very valuable for our customers to know that at the point of cell line development rather than learning that downstream while they're trying to scale things up. That would, of course, there's a lot of waste in terms of processing time and dollars spent for our customers. And so, what we're doing is part of our strategy has always been to take these downstream quality checks and move them as early in the process as possible so that our customers have a better product, have the best product as they move into scaling up their solution.
- Paul Knight:
- And then lastly your sales headcount and sales headcount goal for the year end?
- Eric Hobbs:
- Yes, we continue to drive our sales headcount up. And we had previously mentioned that we're looking to push up from 2020 through a factor of two into 2021. And we'll continue to drive sales heads and sales head count as we move. But simultaneously Paul, in addition to headcount, it's all about also getting efficient with our sales headcount, ensuring that we have the right marketing materials and these things for โ and sales tools for our sales โ our sales leads to be able to effectively do their job. So, it's a balance of both headcount and process.
- Paul Knight:
- Thanks.
- Operator:
- Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.
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