Good afternoon, everyone, and thank you for joining us for this session. My name is Mallika, and I am an associate with the JP Morgan Healthcare Group. It is my pleasure to introduce to you today Masoud Toloue, who is the CEO, and Mike Doyle, who is the CFO of Quanterix. Thank you so much for joining us here today. Before we kick off, just a quick reminder of the format of the session. We will have a presentation followed by Q&A. Please have your questions ready for the Q&A part of the session. I will now hand it over to Masoud. Thank you so much for joining us and sharing your story here.
Good afternoon. Thanks for coming to our presentation. We are excited to be here. Thank you, Mallika and JPMorgan for hosting us. Before we begin, I wanna direct you to our safe harbor statement. This presentation contains forward-looking statements. Forward-looking statements in the presentation are based on Quanterix's expectations and assumptions as of the date of the presentation. Each of these forward-looking statements involves risks and uncertainties and are discussed in our SEC filings and our website. It's an exciting time both in Quanterix and the field in general. Never before has there been such excitement towards identifying new biomarkers in the proteomic space, especially towards neurodegenerative research. If you're paying attention to the news, you're familiar with recent Alzheimer's drug approval that just happened on Friday, and we're very excited about that.
It was, you know, had been a difficult field fraught with a lot of failures in the space. You know, our principle at Quanterix has been, and has always been that, our view is for, you know, for whenever there's something difficult to achieve, there's going to be people who are resilient and do a lot of work towards achieving it. We serve those people. We have the honor at Quanterix to serve those people with breakthrough technology and allow them to enable biodiscovery. You know, our mission is simply explained in a single sentence. You know, our technology, the work we do is about elucidating biomarkers, transforming protein signatures to biomarkers to have an incredible impact on healthcare.
In execution of that mission, we've, you know, the great people at Quanterix have grown a company that is at global scale. You know, last year, our revenues were over $100 million, and we're all around the world, around the globe. We have over 875 platforms placed around the world, and that's been growing. A number of accelerator projects or projects coming in through our first services laboratory has been increasing. Using our technology, we've been able to identify, you know, over 550 biomarkers using Simoa. The publication rate at which things are published has never been growing at a faster rate.
If there are three things I'd like you to take away from, you know, today's presentation is, you know, number one, our technology is unmatched when it comes to sensitivity in detecting protein biomarkers. We're in the very early stage of a large proteomics revolution, and we have, you know, highly under-penetrated in this market. three, our strategy is beginning to converge together around a important time in neurodegenerative research. Our goal is to enable those future therapies and provide solutions to both researchers and patients. First, let me tell you a little bit about the technology that we have at the company. What powers Quanterix is technology called Simoa. Simoa stands for Single Molecule Array technology. This is technology invented in 2007 by Dr. David Walt in his laboratory.
What differentiates this technology versus typical or other ways of detecting protein is that this is a digital measurement. You use single molecules to reach a detection limit with Simoa and using, you know, traditional protein detection methods, you need millions of molecules to reach that detection limit. On the left-hand side, you're dealing with a bulk analog measurement, and with Simoa, we're able to look at sensitivities that are up to three orders of magnitude of improvement versus typical assay or protein detection. The reason why this is incredibly important has to do with the proteoform or the, you know, proteoisoforms. If you think about in the human body, there's around 20,000 gene-encoding proteins.
Those transcribed into a couple hundred thousand RNA transcripts, which then become a couple, you know, 10,000 or so proteins, of which there's a 1 million proteoforms. You know, think about phosphorylation, acylation of these proteins, and these markers are incredibly dynamic. Whereas in the genome, you have a single genome, and that genome is the same in one cell to the other cell, that's completely different in the protein world. Those proteins are at different expression levels and concentrations based on time, age, species, disease. It's incredibly dynamic and very much closer to clinical actionability. Simoa sensitivity allows for digital detection of these isoforms. Because we have that sensitivity, we can look at less invasive and smaller sample types.
We're looking at new biomarkers and new proteoforms that haven't even been discovered yet. We're able to multiplex because we have that sensitivity advantage, and we're really unraveling heterogeneity in tissue and fluid. you know, yeah, I think the technology is incredible, and then the importance is directing that technology to incredibly difficult biology problems. The great work that's done by the people at Quanterix is transforming the technology and making it available to researchers and clinicians. That's been done through a product mix of about 80% instruments and reagents and 20% services. Our technology can be found in three different platforms. We have two benchtop platforms and a single platform that allows for sample in, answer out.
You take a blood tube, blood sample, you put it into our platform and our system using our reagents, and you get answer out. The entire workflow happens in that platform and that instrument. For each of those instruments and platforms, we have an assay menu that's both catalogued, and we allow for home brew assays to be developed on this platform. We have a services business that's run by an incredible leader. His name is Mike Miller. He runs the clinical business. It's a CRO business. We take in samples and we perform services for clients and customers around the world. I'll talk a little bit about some of the work we've been doing in that same laboratory for diagnostics, specifically our CLIA diagnostic laboratory.
Our vision as a company is, you know, essentially twofold. Number one, very simply, you know, we believe that there should be a similar platform in every single research laboratory. The reason we have that view is that the depth of the sensitivity we offer allows researchers to identify proteins previously undiscoverable. Isoforms that are very rare, isoforms that are in blood and they need, you know, elucidation and need to be identified and converted to biomarkers. Just like, you know, our view is that you have, you know, a microscope in every lab and you're looking at this whole microscopic world, we're looking at, in the protein space, a world that's currently undetectable by current technology. That's our view is why, you know, every one of these, there should be a platform in every lab.
The second area is that our sensitivity enables new early detection and diagnostics. You have to think about sort of a disease category. If you can identify a biomarker early in its pathway, and you have proteins that are very low in concentration, and you can detect those early, then you're truly performing healthcare as opposed to sick care. Imagine you have a protein biomarker, and it's early in the cascade of a disease. You identify it using Simoa technology. Now, you can actually do something about it and perform treatment. The sensitivity plays a role in two major forms. One, you're identifying the isoform, which is hard to detect using other methods.
Two, you're able to do it non-invasively in sample types that are much more readily accessible than CSF or doing brain, you know, a brain image or doing surgery. The view there is that if you can do this in blood, non-invasively, you can detect disease early. A couple examples of that, one in neurodegeneration, when there's misfolding of proteins, tau protein goes from the brain, crosses the brain-blood barrier, it goes into your blood. We're able to detect phosphorylated tau, which is important as entry criteria for Alzheimer's, for getting people onto clinical trials, and we think in the future, diagnostics. The second area, you know, we've been doing a lot of work on around cytokines.
If you can catch a cytokine early in its cascade, there's great implications for immunology and great implications for infectious disease. A couple examples of early detection. Looking at the proteomics market, we believe that similar to genomics, proteomics market is incredibly big, and it's growing. As I said earlier, the proteoform and the proteoisoforms are continuously changing based on disease, based on condition. We think this is a very rapidly growing area of which Quanterix plays a unique role versus others in the proteomic side in each of these categories. From discovery through to research, testing, and clinical trials, and then ultimately into diagnostics.
If you look at the early part of this cascade, you could see, you know, when you're doing discovery, you're looking for technology to screen, you know, thousands of proteins and identify a few or a handful of markers that are interesting in a screen. You know, you're looking yes and no and high and low, and you pick out five and then you enter this research phase where you're doing research and further evaluating those selection of four or five proteins of interest. If there is something interesting, you can convert a protein signature into a biomarker, and then it's typically used in a drug trial or a clinical trial associated with a drug.
If there's success or a key need to detect something early, that marker can become an LDT or a diagnostic. As Quanterix where we play a role, we play a role in each of these categories. On the, on the left-hand side, you could see, you know, many companies in the discovery space, doing, you know, key important discovery of these proteins, to translate this. Typically in the protein space, you do discover, you identify some important proteins. Unfortunately, right after that, then those pairs are identified and a simple ELISA test is done, and there's a lot of screening in the ELISA test.
On the right-hand side, the great, you know, companies doing diagnostics work and have, you know, systems all around the world will take that pair where there was excellent screening, and they'll put it into their trac system, and they'll make it available globally. Now, where Quanterix differentiates itself from this typical mode of discovery handed over to an ELISA plate for screening to diagnostics is that we, because of our technology, you have to do the discovery, you have to do the research, the clinical trial testing in our sample to answer platform. The technology we have is proprietary. You can only do it on our platform. You can't use our assays on other platforms, and we're able to take this through the continuum, and it's been a reason why we've been so focused in neurology.
We're taking neurology from the discovery research drug trial, trials to the diagnostic space. Now, 70% of our install base are in neuro biomarker labs. If you kind of look, we believe we're very under-penetrated and expanding research market, which is, you know, less than 10% of the funding. Here's an example of NIH funding in the United States. We view this as a great area to expand therapeutic areas. Our focus is of neurology because we're going on this continuum, and we think there's potential. Going back to our, you know, view, our vision here, that there should be one platform in every lab, we have, as I said, 875 platforms.
There's, you know, in our view, around 100,000 platforms where we think Simoa should exist. Our opportunities to unlock TAM are not just therapeutic area expansion, but they include increased sensitivity. We'd love to see higher sensitivity to be able to detect not just proteins, but in the future, metabolites and other very hard to detect molecules, using, you know, higher ultra sensitivity. Increased access. If we're going to get this platform in all laboratories, and it's gonna be ubiquitous, like a microscope or some other detection platform, there's gonna have to be innovation both in footprint, price and workflow. We have a lot of work to do. Now, going back to neurology.
As a company, we believe, the next 10 years, of neurology, are gonna be incredibly impactful. I think what you're seeing in the last year and recently in the last week is that Alzheimer's has had, you know, significant breakthroughs. We're very excited about what's happening in the Alzheimer's space. You know, there's a graveyard of these therapies that haven't been successful, and now we're seeing some success, and we look forward to the near term. As we're seeing new work happening in the Alzheimer's side, we're quickly developing biomarkers for this space. We're actively involved in building around Parkinson's disease, and multiple sclerosis. We're looking at neurodegeneration and TBI, traumatic brain injury. We're also applying our biomarkers to research studies that are in their early phases.
While we're doing this work today, we believe in the midterm and later in this decade, there are gonna be incredible breakthroughs around mood disorder, frontotemporal dementia, neuro-side- effect testing, pain, and general cognition. We believe this is the neuro decade, and we're very excited. We think it's early innings. Now you go from research and the discovery side into the clinical market, and there's a big translation of these blood-based biomarker Simoa assays. This conversion of research-based protein signatures to biomarkers is expanding. I think it's, you know, the fastest pace that's happening today in research. A few examples of these are a few that we've highlighted. This is non-invasive biomarker measurements that are empowering both the preclinical and the postclinical opportunities in the market.
You can see in some cases, we've worked with the pharma partners on their own biomarker, and we've taken that biomarker and enabled the ability to detect important signatures by running it on our Simoa platform. In other cases, you can see that we've these companies have used our off-the-shelf biomarkers for their work. This just highlights a few of our trials and, you know, very excited to see on Friday the Leqembi label highlight the plasma p-tau181 test on the Simoa platform. You know, incredibly exciting to see it listed as a biomarker endpoint along with PET imaging imaging. We believe this is a major direction in the field for blood biomarker expansion.
If you look, you know, closely at the label, it was, you know, great 10 milligrams per kilogram of Leqembi every two weeks reduced mean plasma p-tau181 by 24% from baseline in 79 weeks. That's, you know, a very highly significant decrease. The way we see this playing out is sort of twofold. One, today, if you are running an Alzheimer's clinical trial and you're trying to identify a pre-cognitive impaired cohort, you have to screen several hundred of thousand patients, and then to get to a size of about, let's say, 1,000 for a clinical trial. If you use PET imaging the cost is around $5,000 per patient, and it's just the economics don't make any sense. Today, a lot of the biopharma companies use Simoa for early entrance or screen prior to the PET imaging.
We, you know, screen in patients for the PET imaging, they're tested by PET imaging, and they're included in the trial. We think that, you know, around the world there's 55 million people who unfortunately have Alzheimer's and dementia. That is going to require something similar, where you're going to need a screen before you run someone and do a PET imaging. We could see somebody coming in for a memory concern, they get a cognitive assessment done, they do the blood screen, they get PET imaging performed, and if this is positive, then they're accepted into treatment and monitoring. In the future, we think that, you know, the one part that could drop out is the imaging, and we're thinking we're getting closer and closer to that point.
You know, going to the end of that continuum that we described is the diagnostics and the LDT side. You know, with... as I said, 55 million people having dementia, or at, you know, Alzheimer's around the world, unfortunately with the aging, you know, population, that's going to increase. In the next several decades, that number is gonna be 150 million people. Where we see biomarkers powering therapies around triaging these patients, diagnosis, monitoring, and screening. Not just Alzheimer's disease, but as I said, traumatic brain injury, which is, you know, a popular discussion item in sports and, you know, also other tangential disease areas.
Very happy, in this vein on the diagnostic side, happy to announce the launch of our NfL CLIA laboratory developed test. Our CLIA LDT test is now available as of Monday in our Accelerator Laboratory. It's a new blood test for access to measuring brain health. This is a incredible indicator. We call it the "check engine" light for the brain because it's a, not a specific marker, but it's a general marker that gives you a sense of there's a problem and, you know, further work has to be done. This has been used in TBI, Alzheimer's, Parkinson's disease, ALS, multiple sclerosis, and today it's being used in therapeutic trials with the potential to become a standard of care for brain health. We're very excited about this.
I think this is, you know, at least one great example of where Quanterix is, you know, developing and doing the discovery for a important biomarker in the brain, taking it from discovery to research, and then converting what was, you know, back then a signal to a biomarker that's used in drug trials and clinical trials. Pleased to say, in the last week, we've converted that to a CLIA LDT. We're taking that value and moving it across the continuum. We're not gonna stop there. We have a lot of work to do. Last year, we launched the p-tau 181 CLIA LDT. The p-tau 181 that I referenced is the same biomarker that was used in the Leqembi study by Eisai.
Right now, our LDTs, the main market for this is continues to be clinical research, prospective trials, clinical utility studies. We see in the future with the, an approval of a drug, this becoming more part of clinical care. Existing workflows needing, you know, better diagnostics to improve uptake for future therapies. We've done these LDTs. We have two FDA breakthrough designations for our NfL and our p-tau181 marker. Our goal is to continue down this pipeline of expanding access to people doing both clinical research and for patients. Last year, we began down a very transformative path with a new strategy in the company. That strategy is pinned to two key areas. Number one, the democratization of Simoa.
As I said, Simoa in every research laboratory. Unlocking both the clinical and the diagnostic TAMs, especially in the neurology field. We announced when we began that we're going down a six-quarter path to transforming the company and making sure that our technology and our assays have the capabilities to go from discovery all the way to trials and diagnostics. Six quarters in, we're happy to say that the progress has been excellent. We expect to transform and the outcomes of this transformation to include a rapidly access to a rapidly emerging proteomics market, profitable growth as an organization, and ultimately, as I said before at the beginning of the presentation, tools that enable researchers to do incredible work.
By developing a product development engine, we expect the rate at which we develop assays for our Simoa platform to increase significantly, and we expect innovation, future innovations on the platforms that we currently have. I'll leave you today with sort of where we started and where we are. Our IPO was about five years ago, and since then, today we're the most sensitive protein detection platform in blood. We have incredibly strong IP protection. We're leading the path in the translation of these protein signatures to biomarkers, especially in the neurology field. Part of this is, you know, possible through our sample-to-answer platform. Unlike other platforms, you can put the sample in and get the result out. We're continuing to innovate.
As I said, the company is global, at global scale, global commercial scale, we're adding additional accelerants to build momentum from where we are and we hope that we can empower this field. Mallika, I'll end it here. Maybe one thing that I'll just add is that we have an excellent team. Mike Doyle, Samira Amini, Darren is here. He's our Chief Commercial Officer. Back in Boston, our Chief Operating Officer, Dan, has done incredible work in the inside of the organization. Super excited. Mark, Brian, Erica, Alex, excellent leadership team and I'd say we're just getting started. Thank you.
Thank you, Masoud, and thank you so much for all of you being here today. We'll now transition into Q&A. If anyone has any questions, please raise your hand and we'll hand over a mic. Well, maybe to kick off, one question that we have on our minds is, Quanterix did go through a bit of a transformation last year. Would it be possible to talk a little more about why the transformation happened and how we can measure progress going forward?
Yep, absolutely. At the end of the second quarter, we took a look at the value proposition Quanterix has, and it sort of relates back to being in the discovery research space and then the demand from our customers for more clinical trials, for more testing in these high throughput fashion and more opportunities towards diagnostics. We said that in order to achieve that value and enable this market, that we're going to begin a assay redevelopment program for our technology and our platform. That assay redevelopment program is not just related to our assays, but it also includes work that we're doing in our operations and scaling to be able to meet that future demand. We did that big pivot in the second quarter.
We announced that it would take six quarters to achieve, two quarters in, we're happy to say that the progress, and our expectations are on track.
Thank you. Maybe switching to macro a little bit, given that China has opened up now and we are seeing a little bit of a COVID-19 uptick there. How does that influence your business? Maybe would be good to hear about that as well.
Yeah. Thanks, Mallika. Yeah, I think one of the important factors is that, hey, this research and this work is not just happening in one continent. It's happening around the world. China is a very big opportunity for us. One of the things that we did there is we opened a non-exclusive partnership with a partner to really take this technology from research to IVD. With COVID-19, and our view that there should be a in China for China strategy, we began this partnership with UltrDX. We announced it at our last earnings call. The view there is, you know, enable LDTs and enable future diagnostics in, in country. It's a, it's a growing area for us and we're gonna be paying a lot of attention to it.
Thank you. Given the Alzheimer's drug news that we got last week, what are some of your key takeaways in the Alzheimer's market and therapies and testing?
Yeah. Oh, I think the... One, our view is that there needed to be a first drug approved in the market, and then we hope reimbursed eventually in the market. When you have that first leader, I think what happens is that there's a lot more funding, a lot more hope, and a lot more work and resources that are poured into a field once you have that blazing, you know, that something that's blazed the field. So I view a lot more work could be combinatorial therapies. It could be tau therapies, not just amyloid that enter. So the whole research category in neurology, I think was a big uplift after that announcement. That's just everything preclinical. Then on the clinical side, our view is that, you know, this is great.
We think that blood, biomarkers are gonna have to enable this therapy. I talked about the 55 million people who have dementia and the disease, and they're gonna need screening. We think that the blood biomarker is gonna be critical to make that happen. We're excited about the opportunity and in the next 10 years.
Yep. We're very excited to see how this pans out as well. Maybe one thing to pivot a little bit is you have a very healthy balance sheet. How do you plan to deploy it? Are there any upcoming plans for M&A?
Yep. Yeah, thanks. Our view on the balance sheet side is that if there's an opportunity to accelerate both what we're doing on the innovation side or what we're doing on this transformation side, that we take a look at it. We, you know, have opportunity and optionality to do that. It's something, the inorganic option is something that we do consider as part of our strategy.
Thank you. Are there any other questions from the audience? Can have you repeat.
Just thoughts on competitive landscape in Alzheimer's companion diagnostic and differences perhaps in some of the tests that were used during the clinical development versus commercial and-.
Yep.
-cost and scalability.
Absolutely. Yeah, I think when I think of platforms that are used in blood biomarker testing, I immediately think of. Well, you have a detection issue or detection problem. You know, these proteins are misfolded. They cross the blood-based biomarker testing, and they're found in blood, and you wanna detect them in blood. You don't wanna do a CSF or a spinal tap to access them. When they're in blood, they're very, you know, they're diluted, and so you need technology with sensitivity to detect them. Mass spectrometry is a great platform for measuring proteins, you know, where you need high sensitivity. Our view is that, you know, in partnership and when working with mass spectrometry technologies, that you're gonna have to scale that, and you're gonna need a sample- to- answer platform that doesn't have a long workflow.
You need a solution where you can put the sample in and get the result out, and I think that's where we differentiate ourselves. Number one, the technology's gotta be able to measure at high sensitivity. These are markers that are diluted in blood. We don't believe, you know, typical immunoassays are gonna be able to get to that sensitivity for phosphorylated versions of tau and other isoforms. We think that the technology we have is gonna be critical for that. Could there be other areas or modalities for discovering new biomarkers? I think I listed a bunch of companies that are actively doing that and we, you know, wish them well, and we think that those biomarkers are gonna be important for the field.
Well, maybe to close out the Q&A, what keeps you most excited for 2023? What should we look forward to?
Yeah. Well, one, I said we have a great team, right? The company has been doing an extreme amount of work towards achieving this opportunity. I'd say in 2023, we've sized up this transformation. We'll be exiting the year having performed that transformation, and so we see more opportunities there. Just that phase of transformation is exciting in itself. Then two, I would say that innovation. We, I talked about a product development engine that we're working on that's not only gonna be adding new assays and biomarkers to the market, but I talked a little bit about our interest in making sure there's a platform to achieve that goal of one Simoa in every lab.
Thank you. Congratulations to your team for all the very impactful work they've accomplished.
Thank you, Mallika.
Yeah. Thank you all for joining us today.