ThermoGenesis Holdings, Inc.
Q3 2021 Earnings Call Transcript

Published:

  • Operator:
    Good day, and welcome to the ThermoGenesis Holdings conference call and webcast to review financial and operating results for the third quarter ended September 30, 2021. . As a reminder, this conference call is being recorded. I would now like to turn the conference over to our host, Paula Schwartz, of Rx Communications. Please go ahead.
  • Paula Schwartz:
    Thank you, operator. This conference call contains forward-looking statements within the meaning of the federal securities laws. The company's actual results may differ materially from those projected in the forward-looking statements. Additional information concerning factors that might cause actual results to differ materially from those in the forward-looking statements is contained in the company's periodic reports filed with the Securities and Exchange Commission. The information presented today is time-sensitive and is accurate only as of the date of this call, November 12, 2021. If any portion of this call is being rebroadcast, retransmitted or redistributed at a later date, ThermoGenesis will not be reviewing or updating this material. Participating on today's call is Jeff Cauble, Vice President of Finance and Principal Accounting Officer. I'd now like to turn the call over to Jeff. Please go ahead, Jeff.
  • Jeffery Cauble:
    Thank you, Paula, and thank you to everyone for joining the call this afternoon. We appreciate you taking the time to listen in. Throughout our 35-year history, ThermoGenesis has proven its ability to pioneer the development and production of a long list of cutting-edge automated technologies and products for the cell banking and cell therapy industries. As the overall life sciences industry has continued to innovate, personalized treatments have become the wave of the future. Within the market, cell and gene therapies are becoming more and more important and are poised to continue to revolutionize many areas of medicine. For its part, ThermoGenesis intends to remain a leader in the development and commercialization of automated cell processing technologies that provide more efficient, higher quality and cost-effective manufacturing solutions to bring these therapies through the clinic to the patients in need. In September, we were awarded a $250,000 Phase 1 Small Business Innovation Research grant to develop and test the single-use sterile cell processing disposable that will be used by the fully automated Quintessence System for gene engineering autologous cell therapies. The work taking place as a result of this grant is another reflection of our pledge to continue to bring groundbreaking solutions to the industry and will serve to booster our product line of automated cell processing tools to utilize as a contract development and manufacturing, or CDMO, services company. To drill down, today's drug developers must address the key challenge
  • Operator:
    . Our first question is from Sean Lee with H.C. Wainwright.
  • Sean Lee:
    My first question is on the CDMO business. So the switch from a device company to a CDMO is a -- has been the stated goal for the company for the last couple of quarters. So I was wondering whether you could update us with some more details on the plans and also the expected time line.
  • Jeffery Cauble:
    Yes. The plan is progressing. It has been moving forward. We do have some progress that we've made as far as working on some new contracts and bringing in some new facilities and operations for CDMO. We have -- we're not really at a point where we're ready to talk too much about that. Certainly, as we move into our 2021 Annual Meeting, we'll be ready to talk in more detail.
  • Sean Lee:
    Great. In terms of the rest of the business, once you have the CDMO up and running, would you still be selling the X-Series products independently?
  • Jeffery Cauble:
    Yes. So those are sold through Corning right now in that distribution agreement. So that agreement still extends for another 2.5 years, and then there are options to extend even beyond that period. And then we also have some -- the PXP devices, which we'll also continue to sell independently, in addition to the CDMO business.
  • Sean Lee:
    I see. And my last question is the -- on the SBIR grant. So it's for developing a new single-use processing disposable, so how is that different from the existing X-Series cartridges?
  • Jeffery Cauble:
    So it's different because it is -- the design of that project is to fully automate the process. Like when you look at the process now, a lot of the CAR-T therapies, the reason why they're so expensive is because it's a very manual process. It takes roughly 2 weeks or so in order to -- from the time the cells are drawn until the time they're inserted -- ready to be inserted back into the patients, just of processing. And that's one of the reasons why the cost is so much. So in order to really bring that cost down, you need to automate that whole process. So that's what the Quintessence process is. And it will help to not only reduce the time frame, but also significantly reduce the cost.
  • Operator:
    This concludes our question-and-answer session. I would like to turn the conference back over to Jeff Cauble for any closing remarks.
  • Jeffery Cauble:
    Yes. Thank you, operator. We look forward to updating you on our progress during our year-end call, and thank you to everyone who participated today and in your interest in ThermoGenesis Holdings.
  • Operator:
    The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

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