Good day. Welcome to Twist Bioscience's fiscal 2021 Q4 and full year financial results conference call. At this time, all participants are in listen only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during the session, you will need to press Star then one on your touchtone telephone. If anyone should require assistance during the conference, please press Star then zero to reach an operator. As a reminder, this call is being recorded. I would now like to turn the call over to Angela Bitting, SVP, Corporate Affairs and Chief ESG Officer. You may begin.
Thank you, Michelle. Good morning, everyone. I would like to thank all of you for joining us today for Twist Bioscience's conference call to review our fiscal 2021 Q4 and full year financial results and business progress. We issued our financial results release as well as the press release announcing we entered into an agreement to acquire Abveris this morning, both of which are available at our website at www.twistbioscience.com. With me on today's call are Dr. Emily LeProust, CEO and co-founder of Twist, and Jim Thorburn, CFO of Twist. Emily will begin with a review of our recent progress on Twist businesses. Jim will report on our financial and operational performance. Emily will come back to discuss our upcoming milestones and direction, and then we'll open the call for questions. As a reminder, this call is being recorded.
The audio portion will be archived in the investors section of our website and will be available for two weeks. During today's presentation, we will make forward-looking statements within the meaning of the US federal securities laws. Forward-looking statements generally relate to future events or future financial or operating performance. Our expectations and beliefs regarding these matters may not materialize, and actual results and financial periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks include those set forth in the press release we issued earlier today, as well as those more fully described in our filings with the Securities and Exchange Commission.
The forward-looking statements in this presentation are based on information available to us as of the date hereof, and we cannot at this time predict the full extent of the ongoing impact of the COVID-19 pandemic and any resulting business or economic impact. We disclaim any obligation to update any forward-looking statements except as required by law. With that, I'll now turn the call over to our Chief Executive Officer and Co-founder, Dr. Emily Leproust.
Thank you, Angela, and good morning, everyone. Fiscal 2021 was a defining year for Twist. We diversified our synthetic biology business and expanded our customer base while accelerating our NGS revenue. In parallel, we leaned into biopharma, evolving the company from solely a service provider in this business segment to a partner of choice. In data storage, we continued our engineering progress and are working within the DNA Data Storage Alliance to build market awareness of this novel storage solution. Overall, we've moved from a product-specific focus towards enabling applications across large and growing end markets. We have made some important announcements over the last two weeks, and we'll take some time today to talk through the strategic directions of the company, as well as how the individual pieces fit within our overarching plan.
Against the backdrop of a global pandemic, we reported record revenue of $132.3 million for the year, an increase of 47% over fiscal 2020, and we reported $159.5 million in orders, an increase of 37% over fiscal 2020. For the Q1, with a tough comp against last year where we had a single large order of $9 million, we reported revenue of $38 million and orders of $45.2 million, an increase of 17% and 6% respectively. Diving into the specific businesses, I'll start with Biopharma as we announced a definitive agreement to acquire Abveris this morning. Abveris is a privately held antibody design and discovery company focused on in vivo discovery using a novel mouse platform.
They have conducted many discovery campaigns for partners with about a 70% rate of return. They currently have 90 custom-90 customers operating today on a fee-for-service model. We see Abveris complementing our synthetic antibody discovery capabilities very nicely. Following the acquisition, their animal-based antibody discovery method and antibody screening technologies will augment our own antibody discovery and optimization capabilities. Importantly, they have an established customer base with 6 of their discovered antibodies in clinical trials. The company has 35 employees and will continue to operate in their headquarters in Boston following the acquisition. We believe that in fiscal 2023, the Abveris business will be cash flow positive. Taking a step back to look at our overarching biopharma capabilities, following the integration of Abveris, we will have three complementary discovery approaches under one umbrella.
In the first approach, we have synthetic discovery libraries where Twist has a competitive advantage through our DNA synthesis platform technology. We synthesize every sequence desired, including only those found in the human repertoire. Screening targets against these libraries can generate robust antibody leads. Second, another approach is to generate antibodies from an animal immunized with a target and then harvesting and sequencing the resulting antibodies. That is the specialty of Abveris platforms. Third, we have entered into technology collaborations with several companies to leverage artificial intelligence and machine learning technologies to screen through antibody leads and to refine antibody libraries. With the acquisition, Twist will have all three approaches, offering a unique and comprehensive antibody discovery and optimization capability to our partners, as well as for our internal antibody generation. In addition, we have products that support the total discovery process.
Our Oligo Pools can be used to identify targets, and our NGS tools can be used to measure library diversity during panning. Once a customer has an antibody lead, Twist provide tools to develop the lead further through our SynBio offerings, starting with genes and gene fragments and moving all the way through the resulting IgG proteins. Also in biopharma, as you know, we've been working to advance our COVID-19 therapeutic assets discovered through our proprietary biopharma process. We have been working hard to put together a team with clinical development and commercialization expertise. Last week, we launched Revelar Biotherapeutics, an independent biopharmaceutical company. We licensed our lead bispecific antibody to treat COVID-19 to Revelar and have committed to provide up to $10 million in initial funding.
In addition, Revelar can license up to five additional targets over the course of the next four years, each program subject to additional milestones, payments, and royalties for Twist. While the COVID antibody will not be first in class, we do see the opportunity for this antibody that, one, neutralizes all variants of concern, and two, could be delivered subcutaneously, which may offer an overall best-in-class molecule. We know there remains a need for therapeutics that effectively treat long COVID, as well as antibody therapeutics that have broad neutralizing capabilities among the emerging variants, as global vaccination is far from complete and vaccine effectiveness, unfortunately, appears to be declining over time. The recent data on oral therapeutics are promising, though they typically need to be taken within five days of onset and could have safety concerns that may not be seen until more widely taken.
A peer-reviewed publication recently noted that antibody therapeutics also promise to provide long-term protection for immunocompromised patients who don't generate a robust immune response to the vaccine. We believe this leaves space for antibody therapeutics in the treatment regimen. We expect COVID will become an endemic disease and sadly, that it is here to stay. We believe the best path forward for our COVID antibody is to put it in the hands of a team experienced in clinical development and commercialization, and to participate in the upside through equity appreciation, potential milestone payments of over $100 million, and mid-single-digit royalties on any commercial sales. Revelar expects to begin clinical trials for this antibody in 2022, subject to receiving regulatory approvals and clearing other development hurdles.
This spins off fits our internal biopharma philosophy of minimizing biology risk and quickly developing an antibody with an improved pharmacological profile that hits a validated target. We expect that Revelar will be a vehicle for development of up to 5 additional non-COVID targets emerging from our biopharma platform, each of which come with additional upfront milestones and royalty payments. This allows Twist to participate in the upside of any of the 5 additional licensed antibodies while mitigating the risk of development through external funding and an experienced management team. Strategically, for biopharma, we have a vision of what our DNA synthesis platform can add to this industry. We have now built a base of 34 partners with 41 active and 32 completed programs. Of the 73 total programs, 35 have milestones and/or royalties associated with them.
By completing the acquisition of Abveris, we will have more customers and programs coming on board. Through Revelar, we expect to have a Twist antibody in the clinic in 2022, pending the required approvals. Turning to synthetic biology, we reported $14 million in revenues and $20.1 million in orders for the Q1. Over the course of fiscal 2021 and looking into fiscal 2022, we have evolved our platform map to enable us to capture more pharmaceutical and biotech customer needs and address the requirements for the large number of customers who make their own DNA. We believe the largest and most impactful application of synthetic biology from both a financial and environmental perspective will be in healthcare, and we are seeing that play out in our customer base. We have a growing number of customers using our genes, Oligo Pools, and libraries.
Our customers use these products to link phenotype and genotype, and ultimately to gain a deeper understanding of biology for the development of new diagnostics and therapeutics. During the quarter, we saw some impact from an extraordinary event where we needed to shut down production for a short period of time. During QC, we determined that unwanted DNA sequences were included in our genes. None of these genes were shipped to customers, but we did experience a delay in some gene orders. We were able to successfully troubleshoot this issue, clear the resulting backlog within three weeks, and still reported robust orders for SynBio in the quarter. We then experienced a brief recurrence in October that we were able to resolve much more quickly. We believe we have now identified the root cause and do not expect further interruptions in production.
This event highlighted, sorry, our need for additional capacity and dedicated machines, which we are building currently in the Factory of the Future outside of Portland. At the same time, we have a path to significantly increase capacity at our headquarters in the Bay Area to ensure we can meet the increasing demand from our customers for the next 12-18 months. We recognize that we not only need to meet the ongoing increasing demand, but also any surges in demand when large new orders arrive. Today, we have capacity to make approximately 45,000 genes per month, plus fragment and NGS products.
We are building capacity in South San Francisco of 80,000 clonal genes per month by December and 90,000 genes per month by April of 2022 to ensure that we continue to meet the needs of our customers while we bring the Factory of the Future online in 2022. Turning to NGS, we reported revenues of $21.4 million, a record quarter even against the comp in 2020, where we shipped a single $9 million order. We launched several products to bolster our offering, including the Exome 2.0, the most comprehensive exome offering with best-in-class performance. In addition, we introduced our Alliance Panels products, which are kits with curated content from key opinion leader in their respective fields, sold through Twist.
This quarter, we also launched a robust clinical exome from The Broad Institute and a pan-cancer panel from AnchorDx, building on our first Alliance Panels, the SNP Diversity Panel with content from the Regeneron Genetics Center. We also announced plans to launch panels with Centogene focused on rare diseases. For data storage, we achieved a significant milestone under IARPA Molecular Information Storage, or MIST, program. IARPA evaluation team came to Twist in October and provided us with a set of DNA sequences to be synthesized on the 1-micron proof-of-concept chip in a single day. The sequences were not shared in advance, and we passed the test with flying colors. In addition, we confirmed that we can synthesize DNA at individual sites on the 1-micron proof-of-concept chip with no crosstalk or spillover into adjacent sites. This was a critical technology demonstration that validates our ability to achieve smaller dimensions.
We are currently in the design phase for the alpha chip, which will be our first full commercial release chip. In the meantime, we will lay the groundwork to sign early access customers. To that end, in October, we hired Steffen Hellmold, previously at Western Digital. With the significant technology advances that we have made in data storage, we are now focused on preparing for early access product launch, laying the foundation for commercialization of this disruptive and important storage solution. Steffen will help define our commercial strategy and leverage relationships built over a career in storage to ensure we offer the right product suite for customers in this space. At this time, I'd like to turn the call over to Jim to review our financial results for the quarter.
All right. Thank you, Emily. As Emily noted, we had another exciting and dynamic year as we continued to scale our platform, and we closed out the year on a strong note. Revenue for the quarter was $38 million, a new record for Twist, which is a sequential growth of 9% and year-on-year growth of 17%. This brings our FY 2021 revenue to $132.3 million, a 47% increase from FY 2020 and slightly above the top end of our guidance of $129 million-$132 million for the year. Orders were $45.2 million for the quarter, a sequential increase of 16% and 6% year-over-year. This takes our total orders for the year to approximately $159 million.
Gross margin for the Q4 was 40.7%, and our total year gross margin was 39% as compared to 32% in FY 2020. We shipped to approximately 2,900 customers for the year, and that's up from 2,200 in FY 2020. We ended the year with cash and short-term investments of approximately $478 million. Healthcare is now our largest segment and accounts for 54% of our business, with revenue of $71.2 million in FY 2021 versus $40 million in FY 2020. That's a 78% growth year-on-year, reflecting growth in NGS, biopharma, and growing demand for our SynBio products. Industrial chemicals revenue was $34.5 million in FY 2021 versus $29.1 million in FY 2020.
Even though we're operating in a pandemic, where many academic labs were impacted globally, our academic revenue was $25.3 million versus $19.6 million in FY 2020, reflecting our continued focus on growing the long tail. Agricultural revenue was $1.3 million, essentially flat with FY 2020. Now I'll provide more color on orders. We ended on a very strong note with NGS orders for the Q4 of $21.8 million, which brings our total NGS orders for the year to approximately $76 million as compared to $53 million in fiscal 2020, which is approximately 43% growth year-on-year from a high comp base we referenced earlier.
This growth reinforces the robust and growing market opportunity, our expanding product portfolio, investment in our commercial organization, expanding our customer base with increased adoption and increasing NGS applications, including liquid biopsy, MRD, RNA controls, and clinical applications. During the quarter, we received orders from approximately 670 NGS customers, and the top ten accounts placed orders of approximately $10 million, as compared to approximately $7 million for the top ten in the previous quarter, confirming we're seeing continued diversification of our customer footprint. Our pipeline for larger opportunities continues to scale, and we're now tracking 199 accounts, and that's up from 182 we noted in our last earnings call. 88 have adopted Twist, and that's an increase from 79 we noted in our last quarter. Now turning to SynBio.
We saw robust growth in our SynBio orders, which includes genes, DNA preps, IgG, libraries, and Oligo Pools, which rose to $20.1 million in the Q4, up from $15.7 million in the third quarter of FY 2021, which is a sequential growth of 28% and up from $16.1 million in the last quarter of fiscal 2020, with healthcare segment being the major driver to growth. Now to Biopharma. We continue to scale our Biopharma antibody discovery business as orders rose to $11.6 million for the year, which is a growth of 123% compared to $5.2 million in fiscal 2020. Orders in the Q4 were $3.4 million as we continue to build our pipeline of new and repeat customers. As noted earlier, we have 34 partners with 41 active programs, of which 35 are milestones and royalties.
Please note, orders may not translate into revenue, but do provide a trend line for each product group. Now, moving from orders to revenue. As noted earlier, revenue for the quarter was $58 million and brings our cumulative revenue for FY 2021 to $132.3 million, versus $90.1 million in FY 2020, representing approximately 47% year-over-year growth. NGS product revenue scaled to $21.4 million in Q4, a sequential growth of 14%, and it's notable that we exceeded the $20.2 million for the same quarter of FY 2020, which included the $9 million we mentioned earlier. In Q4, the top four customers account for approximately 50% of our revenue. For the year, NGS revenue grew from $44 million in FY 2020 to $72.7 million, which is 65% growth year-on-year.
Our SynBio product revenue for the quarter was approximately $14 million, and that's down sequentially from $14.3 million in the previous quarter due to the aforementioned production issue and seasonality in Europe. Total annual SynBio revenue is $53 million, compared to approximately $44 million or 20% growth year-over-year. Some of the highlights include shipping to 1,900 SynBio customers in FY 2021, up from 1,590 in FY 2020. Our genes revenue is $39 million, and that's an increase from $35.2 million in FY 2020. We also shipped a record number of genes of approximately 372,000, and that's an increase from 338,000 we shipped in FY 2020. Now to Biopharma.
Our revenue for the quarter was approximately $2.6 million, and full year revenue was $7 million, as compared to $2.4 million in FY 2020. During the year, we serviced approximately 43 customers, demonstrating the progress we're making expanding our platform. I will now briefly cover our regional progress for FY 2021. Our investment in building out our global commercial organization is reflected in our strong international growth. EMEA had another terrific year with FY 2021 revenue of $44.1 million versus $25.8 million, and that's 71% growth year on year, and EMEA now accounts for 33% of our worldwide business. APAC had a great year, and FY 2021 revenue grew about 100% to $10.3 million from $5.1 million in FY 2020.
The US which includes America's revenue of $77.9 million for FY 2021, as compared to $59.2 million for FY 2020. Now moving down to P&L. Our gross margin for the quarter was approximately $15.5 million or 14.7% of revenue, up from 40% in the prior quarter. Total year margin was approximately $51.7 million or 39% of revenues, up from 32% in FY 2020. Now to operating expenses. Our Q4 operating expenses, which includes R&D and SG&A, was $57.7 million. R&D for the quarter was $19.4 million, which brings our total investments in R&D to $69.1 million for FY 2021, and that's up from $43 million in FY 2020.
The major contributors to our investment in R&D were compensation due to higher headcount and external services, primarily associated with our investment in DNA storage and also increased investment in biopharma. Our SG&A in Q4 was $38.2 million, which brings our SG&A for the year to $135.9 million as compared to $103.3 million in FY 2020. The increases are primarily higher compensation as we continue to build out a commercial organization, increased stock-based compensation. Higher fees associated with the audit and investments in addressing our material weaknesses and increased lease expenses as we expanded our footprint in San Francisco and the Factory of the Future in Portland, in the Portland area.
Our net loss before tax was $41 million for Q4, and our total loss for the year was $152 million, which includes stock-based compensation of $37 million and depreciation and amortization of $10 million. CapEx for the year is $27 million, including $13 million for Wilsonville, mostly for equipment deposits and facility improvements. Given the global supply chain challenges, we have strategically increased our inventory to $32 million, compared to $12 million at the end of fiscal 2020. We ended the year with cash and short-term investments of approximately $478 million. Now I'll give some update on our FY 2022 guidance. As we noted, we saw strong bookings in Q4 and are optimistic on our opportunities. At the same time, there remains uncertainty associated with the pandemic.
For FY 2022, our revenue guidance is in the range of $173 million-$181 million, and including the expected completion of the Abveris acquisition in quarter one fiscal 2022, our revenue guidance increases to $183 million-$193 million. SynBio revenue is estimated to be in a range of $67 million-$70 million, as compared to approximately $53 million in fiscal 2021. Our NGS guidance is estimated to be in the range of $94 million-$96 million, as compared to approximately $73 million in fiscal 2021. Biopharma revenue, including our anticipated Abveris acquisition, is estimated to be approximately $22 million-$27 million, as compared to approximately $7 million for fiscal 2021.
For the Q1, we're projecting revenue in the range of $37 million-$39 million, which we believe is prudent guidance reflecting the upcoming holiday shutdowns in Europe, COVID pressures, and the impact of the production issue we discussed earlier on the call. Our fiscal 2022 gross margin projection range is 35%-37%, which reflects the costs associated with our Wilsonville ramp up. Excluding these costs, gross margin would be 42%-44%. Operating expenses, which includes R&D and SG&A, are expected to be approximately $315 million for fiscal 2022, as compared to $205 million in fiscal 2021, reflecting increased investments in biopharma, approximately $40 million, data storage, $20 million, our commercial organization, $20 million, and Portland's OpEx startup costs of $10 million, plus there's higher stock-based comp and higher depreciation.
Our R&D expenses for the year are projected to be approximately $130 million, up from $69 million, primarily due to investments in data storage and biopharma. Our net loss guidance for the year is expected to be approximately $250 million. Stock-based comp is projected to be approximately $47 million, and depreciation is expected to be $13 million. Our CapEx for FY 2022 is projected to be $80 million-$90 million, with approximately $75 million investment in Wilsonville. In summary, we'd like to thank all the Twisters for delivering another terrific quarter with record growth. We had another exceptional year continuing to execute on our strategy, enjoying broad demand from our customer base, and we're significantly stepping up our investment as we continue to tap into new revenue streams. With that, I'll now turn the call back to Emily.
Thank you. Thank you, Jim. We accomplished a tremendous amount in fiscal 2021 with execution across all areas of the business. The execution resulted in significant revenue growth and customer acquisition for synthetic biology and NGS, and we continue to see huge opportunities ahead for both markets. With the recent strategic transactions of Revelar and Abveris, we are well positioned to accelerate our biopharma vertical. In data storage, the engineering accomplishments we have achieved to date set the stage for commercial planning and market introduction. While these four business areas address very different market opportunities, each relies on our silicon-based DNA synthesis platform, which remains at the core of our competitive differentiation and success. Looking ahead, fiscal 2022 will be a year focused on growing market share as well as investing for future success.
In synthetic biology, we plan to continue to build our business and expand our customer base. We expect to launch RGG commercially for our pharmaceutical and biotech customer base, building on positive feedback from our early access customers. We remain focused on bringing out the Factory of the Future to reduce turnaround time, especially for genes. We believe we will begin to see the benefits of reduced turnaround time and adoption for synbio customers who currently make their own DNA in fiscal year 2023. For NGS, we expect to continue to grow revenues from our existing products while expanding our capabilities around RNA and library preparation. We expect to launch a Twist-ified library preparation product we acquired through the iGenomX transaction this calendar year, and we intend to expand our customer base for both SNP Microarray array conversions and Alliance Panels.
For biopharma, we look forward to seeing our first company in a clinic in 2022, subject to receiving the appropriate clearances. In addition, we intend to sign additional partnerships and add programs as well as pursue opportunities to participate in a greater share of wallet and rapid clinical advancement. We also expect to outlicense at least one Twist-discovered antibody by mid-calendar 2022. For DNA data storage, we intend to continue to drive to early access customers and pilot production. Also, we will continue to execute on IARPA's MIST program milestones and actively advance market evolution for this new storage medium in concert with the DNA Data Storage Alliance. With that, let's open the call for questions. Operator?
Our first question comes from Dan Brennan with Cowen. Your line is open.
Hey, thanks. Thanks for the questions, guys. Maybe just first one just to start on the impact from the problem cited for SynBio in the quarter. Did you quantify how much that contributed and is there anything baked in within your fiscal 2022 guidance from that?
I'll jump in and maybe Jim will have something to add. We didn't quantify the impact in 2021. We did note that we actually, you know, finished very strong both in revenue and orders for the Q1. The headwinds from this issue were included in the Q1 guidance and the fiscal 2022 guidance.
Got it. Okay. Maybe on the acquisition, looks like, you know, there's around $10 million-$12 million of revenue baked in. I guess maybe first question is, can you give us a sense of the growth rate of that business in particular? You know, how do we think about, you know, the go forward? I know you've given the sense for fiscal 2022, but any sense on, could you give a little more color on, you know, the customers that they have and, you know, the outlook beyond fiscal 2022? Related to that, is there any conflict as you internalize their technology?
You know, given that Twist is looking to develop its own antibodies, is there any, you know, risk or from their own customers that, you know, they view Abveris now competing with them?
I'll start with the second part, and I'll let Jim answer the first part. As far as the competition, no, actually it's very synergistic. They use in vivo and in vitro approach which generates antibodies that needs to be humanized, and so that goes directly to the Twist platform. There are some targets that don't generate immune response even in the hyperimmune amount that they have, so that's perfect for Twist approach. We have customers that want to maximize their hit rate, and so actually they do both approaches in parallel.
It really adds. It's very complementary and it will enable both platform to build on each other and be synergistic. Jim, do you want to comment on the financial question?
Yeah. Dan, yeah, the $12 million reflects roughly about 10 months revenue this year. We're obviously working through the integration, obviously optimistic. We anticipate seeing significant revenue growth in that business. Right now we're estimating roughly about 30% annual revenue growth from that base. Obviously, we will update that as we continue to develop the business with the terrific team from Abveris. You know, one of the advantages, we're adding customers, I mean, roughly 90 customers, which is an expanded footprint for our SynBio organization as well. In this world where it's tough to get talent, we're bringing in some terrific Abveris team, highly talented and really complements what we're doing with our biopharma and SynBio business.
Great. Maybe a final one. Just on NGS, could you speak through, you know, the fiscal 2022 guidance, maybe some puts and takes? Like what, you know, if we were to look back in 12 months and that number were to be higher, what are the key levers, and included in that, I'd be interested to find out how liquid biopsy is impacting the NGS outlook for 2022.
Yeah. I mean, it ended in a strong note. Bookings were nearly $22 million. Number of customers, we're tracking large number of customers in our pipeline continues to grow. It's just under 200 now. Definitely seeing opportunity in liquid biopsy. Definitely seeing an opportunity in MRD. I mean, this, we launched our exome, as Emily mentioned, so we're expanding our product portfolio. And right now we feel we're making prudent guidance for the fiscal 2022. Our goal is to continue to invest in commercial organization, to continue to give white glove service, continue to expand the product portfolio with increase in R&D. We're optimistic in terms of the long-term opportunity here, and we feel well positioned working with our larger customers.
Great. Thank you.
Okay.
Our next question comes from Tycho Peterson with J.P. Morgan. Your line is open.
Hey, good morning. I'm gonna start with Wilsonville. I just wanna confirm you're reaffirming the midyear 2022 target. To open that up, the slide said 2022. You know, as we think about, you know, capacity there, I guess, I mean, you're generally short cycle, so you're not necessarily pre-booking capacity at this point. How do we think about your ability to you know, scale that capacity? Jim, on margins, I know you're talking about 35%-37% corporate overall. You know, how do we think about the margin impact, you know, as the year progresses around Wilsonville as that capacity gets up and running?
Yeah. Good question. On bringing up Wilsonville, you know, we're starting the initial ramp around our Q4. If you step back, the overall impact for Wilsonville, I'm estimating dollar impact for the year is $25 million. Roughly about $10 million is in our OpEx with G&A. Estimating towards the back end of the year, we're gonna have about approximately $15 million, $13 million-$15 million as we ramp up the facility. That's gonna impact, you know, Q4. If you step back, you just normalize the margin, we're in the 42%-44% range. I mean, our goal is to for Wilsonville, we see the opportunity to be able to leverage pricing as well as we address the faster genes.
Our goal is to scale that business as quickly as possible. That's why we're investing in the commercial organization. We've made a lot of early investments in terms of the capital tools. We're starting to hire. As you can tell from the conference call, we are putting also additional capacity in San Francisco. We're very bullish in terms of the numbers in bio customers, and although there's uncertainty around the pandemic, we should be prudent with our outlook.
Okay. That's helpful. Emily, on data storage, you know, nice to hear the milestone proof of concept, you know, as you get ready for early access launch. Can you just talk about what's left from a technical perspective, you know, before commercial launch? You know, are there milestones we should be tracking for that business for 2022?
Yeah. From a technical perspective, the next step is to keep going down in dimension. Last year, we guided that this year we will have the 1 micron chip working and we do. The next step is to keep going down. Crosstalk, as we mentioned, is, you know, the key technology issue. Now we've been able to make it work for 5 micron and 1 micron, and so we're very confident that we understand the physics and the chemistry and how they relate to each other.
That's why we have the confidence to mention that the next chip, our alpha chip, will be our first commercial chip. We're in the design phase for that alpha chip. Next phase will be the production. Next phase after that will be the debugging development of the chip. When that is done, we'll be able to use it with real customer in a way that's very similar to what happened this quarter with the MIST program coming to us saying, you know, "Those are the sequence I'd like to make." The same thing will happen with our first customer.
In terms of milestones, it's all about getting the chip to work, finding early access customers. As we mentioned in the past, the customers that we'll focus on for the alpha release will be customers that are very desperate, frankly, to get onto a new storage medium and customers that have a forgiving environment. We know that now it's going to be the fourth platform we launch after Synbio, NGS, and BioPharma. We know that's important for the first few customer interactions to work in environments where there is room for back and forth and optimization of the process. To that extent, Stéphane Haumond is a great executive addition to the team to make that happen.
Great. Last one just on some of the business development updates. I guess first on Abveris. Do they get downstream economics? You mentioned, you know, 6 antibodies in the clinic. Should we think about that as being additive to the milestones in royalties?
Not at this point. At this point, their platform is entirely fee for service. As we combine integrated businesses, I think we'll have opportunities potentially to upsize the economic share that we're able to gain.
How are you thinking about the opportunity for Revelar, you know, with this spin? I mean, obviously the antiviral data from Pfizer and Merck was pretty good around COVID. How do you think about that in context of, you know, your monoclonal antibody opportunity? You mentioned, I think, five, you know, non-COVID programs. Is there risk longer term that Revelar could, you know, ultimately compete with some of your own development efforts on the therapeutic side?
No, not the way we structure the business. It's unlikely that Revelar would be working on the same targets as we are. If they were, we'll definitely have the advantage of having started first. It's very synergistic. The COVID assets are enabling us to be in the clinic in 2022, which is great for Twist's first recent antibody. We have a great experienced team. The idea is to syndicate the risk by having the work done at Revelar, supported by external funding.
At the same time as we keep an upside opportunity through equity appreciation and nice upfront milestones and royalties. It's very much additive. There's very little risk of working on issues of theft the way the deal is structured.
Okay. One last one for Jim before I hop off. You know, you've got $465 million or so in cash in the balance sheet. You know, the burn this year is gonna be about $300 million, I think, with net loss and CapEx. Can you just talk on how you're thinking about the balance sheet and potential needs to raise more capital?
Yeah. I wanna keep a strong balance sheet. We see lots of opportunity for the company going forward. As always, I'm conservative as Scott's guy. You know, we're bringing up Wilsonville this year. We're investing in data storage. We do see upside in terms of the growth in the business. As we evaluate our opportunities, I'll be making sure we have a strong balance sheet to finance the growth in 2023 and 2024.
Sounds good. Thank you.
Yep.
Our next question comes from Catherine Schulte with Baird. Your line is open.
Hey, thanks for the questions. I guess first, maybe just going back to the production issue that you mentioned. You know, what was the root cause there? Did it impact all of your production? You mentioned clearing the backlog in three weeks, but also called out that there would be an impact to SynBio revenue both in the fourth and Q1. You know, when did the disruption occur? Do you think you lost any customers due to the delays there?
Thank you for the question. The issue happened in August. As you know, synthesizing gene is actually very difficult. It's many steps with chemistry steps, enzymatic steps, cell steps. There was an issue in a combination of reagents and hardware. Frankly, the issue was compounded by the fact that the fab was absolutely full. Part of the issue is, when you're at capacity, there's no extra hours in the day running 24/7 that you can use. When you're at capacity, it actually takes longer than it should to clear the backlog.
That's one of the reason why we are adding capacity in San Francisco in the meantime to make sure that when problems do happen, we're able to catch it very quickly and make it basically transparent on the customer side. In terms of losing customers long term, I don't think there is necessarily a long-term impact, but it puts us a little bit on the back foot as we start the new year and the conservative guide for Q1. Now that we actually saw it a second time very briefly in October, and that really helped us solidify our understanding of the root cause.
We believe now that it's totally eliminated. It's hard to prove a negative and so only time will tell, but we're very confident in scientific understanding of what happened and making sure it won't happen again.
Okay. Got it. Thank you for that color. You talked about expecting to have the first Twist-discovered antibody in the clinic in 2022, you know, with the COVID treatment from Revelar. What about on the partner side? Do you have any indication of how many of those 32 completed programs are advancing and when any of those could advance to the clinic?
We don't have a lot of visibility on where they are. We have no indication that any of them is not moving forward. As far as we know, they all are. We are due in the not-so-distant future for a Twist antibody to be in the clinic. I don't know if the COVID antibodies will be the first ones, but definitely the COVID antibodies are the ones that we have, you know, excellent visibility in them. At the same time, you can see that we reported every quarter how many antibodies are, how many programs are completed. The number is increasing quite nicely.
We're just increasing the number of shots on goals for more and more Twist antibodies in the clinic.
Okay. Last one for me. If we could just maybe go back to Dan's question on NGS revenue guidance for 2022. Came in a little bit higher than where we were, so that was great. Can you just parse out what you expect from existing customers ramping their business with you versus new customer wins, just as we try to think about the visibility into that number?
Good question. Most of the revenue ramp is going to come from new customers ramping as their assets increase in volume with the tests. We do track the pilot and validation our revenues, but the bulk of our revenue comes from those in production, and we'll expect that to be the same for fiscal 2022, and that's what's baked into our forecast. We don't break out how much is pilot, how much is validation, as yet. With the growth of the number of customers, the Q4 bookings, Q4 orders, and the types of assets we're designed into, we're feeling good about our revenue forecast for the year.
All right, great. Thank you.
Our next question comes from Vijay Kumar with Evercore ISI. Your line is open.
Hey, guys. Congrats on the print, and thanks for taking my question. Let me see if I can ask 800 questions on the call. Jim, maybe starting with your revenue guidance here. Excluding the acquisition that you guys did, I think the base revenues were $173-$181. That's about 30%-38%. Considering you guys just did, you know, well north of 45% organic against a tough comp in fiscal 2021, is that, you know, mid-thirties or low-to-mid thirties perhaps conservative? It seems like NGS growth of 30% against a 65% growth in fiscal 2021 seems to be slowing down. How much of this is conservatism versus any factors that perhaps you might be seeing in the business?
In terms of the business, the business is going well. We are obviously still in pandemic. You're seeing lockdowns begin to reappear in Europe. We're always and Vijay, we're always prudent in our guidance and want to be thoughtful. The NGS business is going extremely well. The number of large customers continues to scale, order scale. We're investing in our commercial organization. We're launching new products. At the same time, we want to be thoughtful in terms of the guidance. Yes, there's some major wins in our sales in terms of the market opportunities with liquid biopsy, MRD as an example. We have an extremely talented team at Twist in terms of innovating new products.
I think we'll obviously update the guidance as we go through the year, but right now we feel good about the $94-$96. In addition to that, I mean, the NGS market does continue to grow, and as you see sequencing costs coming down. I think there's good opportunity for us in FY 2022 and FY 2023.
Sticking on to guidance, Jim, the Q1 of $38, that's sequentially flattish. Historically, you guys have grown, you know, sequentially last year in fiscal 2021. If you adjust for the comps, timing of orders, again, you were up sequentially. Why is Q1, you know, sequentially flattish, and what impact are you baking in from the manufacturing issue? Is that a factor in Q1, and should those revenues be recognized in the back half?
Well, there are three issues. First of all, Europe is higher proportion of our business. Revenue for Europe was about $44 million. This scales significantly from $25 million the previous year. The European Christmas vacations and shutdowns has got a higher impact. And also, we've got to be realistic. We are seeing spots of COVID pressures around the globe. We're seeing some of that in Asia. You're reading what's going on in Europe right now. We're trying to calibrate the impact of production issue. The relief is the guidance is prudent in the $37 million-$39 million range.
Understood. The one on free cash flows. Your guidance for net loss of $250 million, that's a massive step up from $150 million in fiscal 2021. What is driving this, Jim? I mean, that's a really big step up. It looks like you guys have about $470 million of cash on hand. Is that enough for you guys to break even on the cash flow side?
A couple things. We're stepping up our investment in biopharma. You know, the overall OpEx is increasing from $205 million this year to $315 million. We're stepping up investment in biopharma by roughly $40 million. We're stepping up investments in data storage by $20 million. You know, we're continuing to invest in a commercial organization ahead of bringing on Wilsonville. The Wilsonville investment in terms of CapEx this coming year is probably about $75 million. Yes, we're deploying capital. We're deploying capital because we really see the customer demand coming in the future. We've got a great team from innovating. Customer base continues to scale.
We're looking at this as a long-term opportunity to invest and scale up in the marketplace.
Gotcha. Then one last one. Your biopharma guidance of $22-$27, ex the acquisition rate, we're looking at somewhere between $12-$15-ish for the year. That's a pretty healthy doubling up of biopharma revenues, Jim. Is Revelar Biotherapeutics a customer of yours? You know, I know you have the equity stake. If it is, how much of a contributor is that, you know, for this driving biopharma strength?
Yeah. There's nothing in that step up assumed for Revelar. Mainly we have built up the investment in biopharma over the last year. We're seeing a lot of customers come back. We're getting about 70-odd% return rate, and this is just based on our continuing to invest in the commercial organization, invest in biopharma. You're seeing that step up in growth. There's enormous demand for antibodies, and we've got a platform, and they're leveraging our DNA platform, our synthesis platform. So we're seeing a significant opportunity, hence that's why we did a step up there.
Understood. Thanks, guys.
Okay.
Our next question comes from Puneet Souda with SVB Leerink. Your line is open.
Yeah. Hi, Emily, Jim. Thanks for taking the question. I have a bigger question here on biopharma. First, we saw Revelar. Obviously, prior to that, you have invested into Twist Biopharma, and now Abveris. Just wondering, you know, given that you have oligos and, you know, and library of libraries, you have now DiversimAb model with mouse model. You have, seems like Abveris is using Berkeley Lights for clone selection and maybe getting some throughput there. If you could maybe just elaborate at this point in time, what else do you need for your biopharma capabilities and essentially antibody discovery capabilities, immunization, high throughput screening, repertoire validation, maybe an expression and scale-up.
Maybe just walk us through what you need at this point, or do you have all the components that you are seeking here to build a stronger biopharma antibody discovery business?
It's a great question. I think we pretty much have what we need. As I mentioned, the three big avenues to discover and optimize antibodies are the Twist approach using a synthetic libraries, the animal approach which now we have with Abveris, and then the machine learning AI approach, which we have a number of collaborations ongoing. So we have access to all three tools. We internally, we've already optimized the panning, the sequencing of the hit, the reformatting of the antibodies, the high throughput affinity thing, functional testing.
We are pretty much set and I think the combination that we have is going to be very powerful, and we can offer a very comprehensive set of suite to our customer.
Okay, that's helpful. Just I'll keep it to two. On supply chain, Jim mentioned a couple of things. Things seem to be, you know, holding well so far. But just wanted to understand, in terms of we were hearing quite a bit about plastic plates and pipette tips and other products, that might be used in, you know, Twist, products and, you know, delivery of products with multi-channel pipette. I mean, multi-well plates and multi-channel pipettes and things like that. Maybe just help us understand, is there anything that we need to keep in mind there? And broadly across supply chains, what are some of the things that you're looking out for? Thank you.
Well, we entered into the pandemic last year. We had a strategy of building out your supply chain. We got ahead of the curve. Obviously, we're vigilant in terms of any potential bottlenecks. We did increase our inventory to $32 million. It was interesting. We did a tour of the facility recently, and the feedback was, "Wow, you guys have got lots of tips sitting around." So far, we've done a good job on keeping ahead of the issues. Obviously, we're seeing demand increase. We've got a terrific team and supply chain that have been delivered in terms of the materials. It's just a matter of keep grinding through this and executing.
Got it. Thanks, guys.
Thanks.
Our next question comes from Matt Larew with William Blair. Your line is open.
Hi, good morning. Just wanted to ask again on gross margins in terms of pacing throughout the year. I guess just contemplating coming back from the backlog here in the fiscal Q1 and then Factory of the Future ramping later in the year. Can you just maybe help us with pacing for gross margins throughout the year?
Yeah. I mean, as you bring on the Factory of the Future, I mean, we are gonna see increased fixed costs. So we're looking at a total spend for Factory of the Future, it's roughly around $25 million. Of that, about $10 million sitting in OpEx, G&A. About $14 million-$15 million, it's roughly about $14 million actually is gonna impact us in the second half of the year. I think in terms of break it out between Q3 and Q4, it's about 30% impact in Q3 of that $14 million and the rest hitting in Q4. So you can build those numbers into your model.
If you just step back, I mean, excluding the Factory of the Future, we're targeting roughly or we're seeing margins range of 42%-44%. As we get into the first half of the calendar year, we'll give you more updates on what that cost looks like so you can normalize the margins.
Okay. And then you mentioned some growing interest within the healthcare segment for synthetic biology. Just curious if you could discuss that a bit more. Maybe somewhat relatedly, just give us a sense for what you're seeing in terms of longer and more complex genes in terms of the demand there.
In terms of the Healthcare segment, we've grown significantly in healthcare. I mean, it's been the area that's where we've seen most growth. You know, what's driving that? You get three factors on the healthcare side. You've got the growth in terms of NGS. You get growth in terms of biopharma. On the SynBio side, we had lots of questions on the last earnings call where sequential bookings declined from Q2 to Q3. You notice the bookings did increase from Q3 to Q4. That's driven by predominantly the Healthcare segment within SynBio. In terms of what does that mean in terms of genes and the gene length, those tend to be shorter genes.
We've seen a switch of our gene activity from last year we had higher percentage, it was longer genes, i.e., more than 1.8 KB. This year, if you're looking at 1.8 KB in non-clonal genes, they're accounting for in the last two quarters, roughly 70% of our gene volume. What's driving that? That's pharma business is driving that.
Okay, I'll leave it there. Thanks.
Okay.
Our next question comes from Luke Sergott with Barclays. Your line is open.
Hey, everybody. Thank you for taking my questions here. Just real quick, did you guys call out the actual dollar value impact from the shutdown in SynBio in 4Q and what's expected in 1Q?
Luke, no, we didn't. I can tell you just from a cost point of view, it was roughly just under $1 million that impacted us. That's due to mostly having to do reruns and waste. In Q1, I mean, obviously we're still working through Q1. The biggest issue in Q1 is just, you know, Europe's a higher share of our business. We had shutdowns, European vacations coming around Christmas. We're seeing some hotspots in Asia in terms of COVID. At the same time, we're seeing significant demand coming in in terms of we had a really strong quarter in orders. You know, we'd rather be prudent at this time of year.
We feel good about the growth rates and the annual guidance and wanna make sure that we calibrate well for quarter one.
Okay. That's helpful. I guess as I'm thinking about 2022 and we're thinking about the NGS tools business, major upside driver, I think to a lot of the way that investors are thinking is gonna come from the liquid biopsy. Can you give us a sense of how big that business is for you? How we should think about either Guardant's new test coming in the early 2022 or the AnchorDx in China, how those feed through?
Luke, we don't break out liquid biopsy. Liquid biopsy is a contributor. I mean, we've got close to 200 large customers who are tracking. We continue to do well in terms of the number that have adopted. Those that have adopted do include liquid biopsy. I mean, our goal here is to build a broad platform because we're seeing more than just liquid biopsy. There's liquid biopsy, there's MRD, you're seeing other NGS-type applications. We have the iGenomX acquisition. We've got a microarray to NGS conversion. We've got the potential of Regeneron coming back. Our goal here is to keep building the business in terms of number of customers and number of applications. Obviously, liquid biopsy will contribute, but we're not breaking out the liquid biopsy impact.
Yeah. Okay. Sorry, I just try to get it out of you.
That's okay. That's okay, Luke.
Lastly, on the R&D step up, this is more of just a longer-term idea here. You guys have the biopharma business, the DNA storage, and then the rest of your core business that's looked at as the cash driver here. Give us a sense of how you bucket out that R&D step up. Is that mostly going to the clinical trial work from biopharma? How is that also keeping abreast of the R&D spend for NGS tools so that you guys can continue to accelerate that growth given it's a you know, a smaller business, but can be a lot bigger?
Yeah, I mean, you're just stepping back looking at the business. I mean, we are stepping up overall R&D. You know, the biopharma roughly will be, you know, we're increasing an additional $40 million biopharma and $20 million in data storage. That's $60 million of the total $130 million. In terms of core business, you know, we're investing substantially more than 20% of revenue in that core business. We'll continue to keep investing in our core business because we are seeing you know terrific opportunities in terms of NGS, as you've outlined.
Also we're seeing, you know, good opportunities in terms of investing in expanding the SynBio platform, as we start to launch our IVDs. You know, I think we're being balanced in terms of our overall investment. I mean, $130 million R&D with biopharma opportunities, Emily has highlighted, and data storage, yes, longer term, but it's becoming more real. All right. Thank you.
There are no further questions. I could turn the call back over to Emily Leproust for any closing remarks.
Thank you very much for joining us today. To close the call, I want to personally wish you a wonderful Thanksgiving. We're especially grateful for all the Twisters. We have delivered on next year in fiscal 2021 and are already enthusiastic about the opportunities that lie ahead for Twist in fiscal 2022. Thank you very much.
This concludes the program. You may now disconnect. Everyone, have a great day.