AbCellera Reports Full Year 2021 Business Results

• Total revenue of $375 million, up from $233 million in 2020, and liquidity of over $720 million
• Total cumulative program starts of 78, with 26 new starts in the year
• EPS of $0.56 (basic) and $0.48 (diluted) compared to $0.53 (basic) and $0.45 (diluted) per share in 2020

VANCOUVER, British Columbia–(BUSINESS WIRE)–$ABCL #antibodies—AbCellera (Nasdaq: ABCL), a technology company with a centralized operating system for next-generation antibody discovery, today announced financial results for full year 2021. All financial information in this press release is reported in U.S. dollars.

“In 2021 we made significant advancements in executing our long-term strategy by growing our portfolio, deepening our platform to unlock new modalities, and expanding our deal structures to add new ways to capture value,” said Carl Hansen, Ph.D., CEO and President of AbCellera. “We move into 2022 with momentum and a strong cash position to continue to grow our business and to make investments that will increase the speed, efficiency, and scalability of our platform.”

2021 Business Highlights

• Earned $375 million in total revenue, including $335 million in milestones and royalties, of which $138 million is in accounts receivable.
• Ended the year with over $720 million in cash, equivalents, and marketable securities.
• Generated $153 million in net earnings, up from $119 million in 2020.
• Started discovery on 26 programs, bringing the cumulative number of program starts to 78.
• Achieved a cumulative total of 156 programs under contract with 36 partners.
• Reached a cumulative total of five molecules in the clinic across oncology, infectious disease, animal health, and immunology, dermatology and gastrointestinal disease.
• Acquired TetraGenetics to expand capabilities for high-value transmembrane protein targets.
• Expanded the leadership team with the appointment of Neil Berkley as Chief Business Officer, Neil Aubuchon as Chief Commercial Officer, and appointed Andrew Lo, Ph.D., to the Board of Directors.

Key Business Metrics

		Year Ended December 31,								Change
Cumulative Metrics		2020				2021				%
Number of discovery partners			27				36				33	%
Programs under contract			103				156				51	%
Program starts			52				78				50	%
Programs in the clinic			1				5				400	%

AbCellera added 53 discovery programs in 2021 to reach a cumulative total of 156 discovery programs as of December 31, 2021 (up 51% from 103 on December 31, 2020), that are either completed, in progress, or under contract with 36 different partners (up from 27 on December 31, 2020). AbCellera started discovery on 26 programs in 2021 to reach a cumulative total of 78 program starts (up from 52 on December 31, 2020). AbCellera’s partners advanced four additional molecules into the clinic in 2021, bringing the cumulative total to five.

Discussion of 2021 Financial Results

		Year Ended December 31,								Change
		2020				2021				Amount				%
		(in thousands, except percentages)
Revenue
Research fees		$	19,848			$	19,076			$	(772	)			(4	)%
Licensing revenue			–				20,778				20,778			N/A
Milestone payments			15,000				8,000				(7,000	)			(47	)%
Royalty revenue			198,307				327,349				129,042				65	%
Total revenue		$	233,155			$	375,203			$	142,048				61	%

• Revenue – Total revenue was $375.2 million, compared to $233.2 million in 2020, of which $327.3 million is attributable to royalties. The partnership business generated research fees of $19.1 million, compared to $19.8 million in 2020. Licensing revenue was $20.8 million.
• Research & Development (R&D) Expenses – R&D expenses were $62.1 million, compared to $29.4 million in 2020, reflecting continuing investments in the capacity and capabilities of AbCellera’s discovery and development platform.
• Sales & Marketing (S&M) Expenses – S&M expenses were $6.9 million, compared to $3.8 million in 2020.
• General & Administrative (G&A) Expenses – G&A expenses were $41.8 million, compared to $11.9 million in 2020, with the increase driven primarily by investments to support the growth of the company, non-cash stock-based compensation in line with publicly listed companies, and protecting intellectual property.
• Net Earnings – Net earnings were $153.5 million, or $0.56 per share on a basic and $0.48 per share on a diluted basis, compared to net earnings of $118.9 million, or $0.53 per share on a basic and $0.45 per share on a diluted basis in 2020.
• Liquidity – $723.0 million of cash, cash equivalents, and marketable securities.

Q4 Highlights and Financial Results

• Started nine programs.
• U.S. shipments of bamlanivimab resumed.
• Added one program under contract with a new, undisclosed partner.

Revenue for the fourth quarter of 2021 was $139.3 million, representing 37% of the total for 2021. $134.5 million was generated in the quarter from royalties on net sales of bamlanivimab and $4.7 million from research fees, representing 41% and 25% of the respective totals for 2021.

Operating expenses totaled $57.8 million in the fourth quarter or 34% of the total for 2021 and include $21.9 million in royalty fees (48% of the total for the year).

Net earnings for the fourth quarter were $59.9 million, 39% of the total for 2021, or $0.21 per share on a basic and $0.19 per share on a diluted basis.

Conference Call and Webcast

AbCellera will host a conference call and live webcast to discuss these results today at 2:00 p.m. Pacific Standard Time (5:00 p.m. Eastern Standard Time).

The live webcast of the earnings conference call can be accessed on the Events and Presentations section of AbCellera’s Investor Relations website. A replay of the webcast will be available through the same link following the conference call.

About AbCellera Biologics Inc.

AbCellera is a technology company that searches, decodes, and analyzes natural immune systems to find antibodies that its partners can develop into drugs to prevent and treat disease. AbCellera partners with drug developers of all sizes, from large pharmaceutical to small biotechnology companies, empowering them to move quickly, reduce costs, and tackle the toughest problems in drug development. For more information, please visit www.abcellera.com.

Definition of Key Business Metrics

We regularly review the following key business metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections, and make strategic decisions. We believe that the following metrics are important to understand our current business. These metrics may change or may be substituted for additional or different metrics as our business develops. For example, as our business matures and to the extent programs are discontinued, we anticipate updating these metrics to reflect such changes.

Number of discovery partners represents the unique number of partners with whom we have executed partnership contracts. We view this metric as an indication of the competitiveness of our technology stack and our current level of market penetration. The metric also relates to our opportunities to secure programs under contract.

Programs under contract represent the number of antibody development programs that are under contract for delivery of discovery research activities. A program under contract is counted when a contract is executed with a partner under which we commit to discover antibodies against one selected target. A target is any relevant antigen for which a partner seeks our support in developing binding antibodies. We view this metric as an indication of commercial success and technological competitiveness. It further relates to revenue from technology access fees. The cumulative number of programs under contract with downstream participation is related to our ability to generate future revenue from milestone payments and royalties.

Program starts represent the number of unique programs under contract for which we have commenced the discovery effort. The discovery effort commences on the later of (i) the day on which we receive sufficient reagents to start discovery of antibodies against a target and (ii) the day on which the kick-off meeting for the program is held. We view this metric as an indication of our operational capacity to execute on programs under contract. It is also an indication of the selection and initiation of discovery projects by our partners and the resulting near-term potential to earn research fees. Cumulatively, program starts with downstream participation indicate our total opportunities to earn downstream revenue from milestone fees and royalties in the mid- to long-term.

Molecules in the clinic represent the count of unique molecules for which an Investigational New Drug, or IND, New Animal Drug, or equivalent under other regulatory regimes, application has been approved based on an antibody that was discovered either by us or by a partner using licensed AbCellera technology. Where the date of such application approval is not known to us, the date of the first public announcement of a clinical trial will be used for the purpose of this metric. We view this metric as an indication of our near- and mid-term potential revenue from milestone fees and potential royalty payments in the long term.

AbCellera Forward-looking Statements

This press release contains forward-looking statements, including statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements are based on management’s beliefs and assumptions and on information currently available to management. All statements contained in this release other than statements of historical fact are forward-looking statements, including statements regarding our ability to develop, commercialize and achieve market acceptance of our current and planned products and services, our research and development efforts, and other matters regarding our business strategies, use of capital, results of operations and financial position, and plans and objectives for future operations.

In some cases, you can identify forward-looking statements by the words “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. These statements involve risks, uncertainties and other factors that may cause actual results, levels of activity, performance, or achievements to be materially different from the information expressed or implied by these forward-looking statements. These risks, uncertainties and other factors are described under “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in the documents we file with the Securities and Exchange Commission from time to time. We caution you that forward-looking statements are based on a combination of facts and factors currently known by us and our projections of the future, about which we cannot be certain. As a result, the forward-looking statements may not prove to be accurate. The forward-looking statements in this press release represent our views as of the date hereof. We undertake no obligation to update any forward-looking statements for any reason, except as required by law.

Source: AbCellera Biologics Inc.

AbCellera Biologics Inc.

Condensed Consolidated Statement of Operations

(Expressed in thousands of U.S. dollars except share and per share data)

(Unaudited)

		Year Ended December 31,
		2019				2020				2021
Revenue:
Research fees		$	11,612			$	19,848			$	19,076
Licensing revenue			–				–				20,778
Milestone payments			–				15,000				8,000
Royalty revenue			–				198,307				327,349
Total revenue			11,612				233,155				375,203
Operating expenses:
Royalty fees			–				27,143				45,516
Research and development (1)			10,113				29,393				62,062
Sales and marketing(1)			1,263				3,842				6,913
General and administrative(1)			2,749				11,910				41,848
Depreciation and amortization			1,604				4,836				14,451
Total operating expenses			15,729				77,124				170,790
Income (loss) from operations			(4,117	)			156,031				204,413
Other (income) expense
Interest income			(155	)			(293	)			(3,330	)
Interest and other expense			209				6,511				5,225
Foreign exchange (gain) loss			(186	)			300				855
Grants and incentives			(1,774	)			(8,320	)			(17,486	)
Total other income			(1,906	)			(1,802	)			(14,736	)
Net earnings (loss) before income tax			(2,211	)			157,833				219,149
Income tax expense			–				38,915				65,685
Net earnings (loss)		$	(2,211	)		$	118,918			$	153,464
Foreign currency translation adjustment			–				–				280
Comprehensive income (loss)		$	(2,211	)		$	118,918			$	153,744
Net earnings (loss) per share attributable to common shareholders
Basic		$	(0.01	)		$	0.53			$	0.56
Diluted		$	(0.01	)		$	0.45			$	0.48
Weighted-average common shares outstanding
Basic			151,327,560				159,195,023				275,763,745
Diluted			151,327,560				263,129,765				318,294,236

1 Exclusive of depreciation and amortization

AbCellera Biologics Inc.

Condensed Consolidated Balance Sheet

(Expressed in thousands of U.S. dollars except share data)

(Unaudited)

		December 31, 2020				December 31, 2021
Assets
Current assets:
Cash and cash equivalents		$	594,116			$	476,142
Marketable securities			–				246,835
Total cash, cash equivalents, and marketable securities			594,116				722,977
Accounts and accrued receivable			213,239				160,576
Restricted cash			–				25,000
Other current assets			5,970				21,247
Total current assets			813,325				929,800
Long-term assets:
Property and equipment, net			17,923				111,616
Intangible assets, net			115,153				148,392
Goodwill			31,500				47,806
Investments in and loans to equity accounted investees			19,247				50,313
Other long-term assets			8,388				30,642
Total long-term assets			192,211				388,769
Total assets		$	1,005,536			$	1,318,569
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable and other liabilities		$	20,195			$	32,017
Current portion of contingent consideration payable			13,411				22,934
Income taxes payable			36,152				35,683
Accrued royalties payable			27,143				22,506
Deferred revenue			6,589				7,536
Total current liabilities			103,490				120,676
Long-term liabilities:
Operating lease liability			3,715				36,413
Deferred revenue and grant funding			25,894				60,758
Contingent consideration payable			9,148				35,886
Deferred tax liability			26,161				37,370
Other long-term liabilities			6,620				1,733
Total long-term liabilities			71,538				172,160
Total liabilities			175,028				292,836
Commitments and contingencies
Shareholders’ equity:
Common shares: no par value, unlimited authorized shares at December 31, 2020 and 2021: 269,497,768 and 283,257,104 shares issued and outstanding at December 31, 2020 and 2021 respectively			710,387				722,430
Additional paid-in capital			5,919				35,357
Accumulated other comprehensive income			–				280
Accumulated earnings			114,202				267,666
Total shareholders’ equity			830,508				1,025,733
Total liabilities and shareholders’ equity		$	1,005,536			$	1,318,569

AbCellera Biologics Inc.

Condensed Consolidated Statement of Cash Flows

(Expressed in thousands of U.S. dollars)

(Unaudited)

		December 31, 2019				December 31, 2020				December 31, 2021
Cash flows from operating activities:
Net earnings (loss)		$	(2,211	)		$	118,918			$	153,464
Cash flows from operating activities:
Depreciation of property and equipment			1,604				2,317				4,403
Amortization of intangible assets			–				2,519				10,062
Amortization of operating lease right-of-use assets			243				435				2,785
Stock-based compensation			890				8,397				30,646
Deferred tax expense			–				2,098				(2,018	)
Other			194				4,707				3,570
Changes in operating assets and liabilities:
Accounts and accrued research fees receivable			(1,803	)			(5,467	)			(37,386	)
Accrued royalties receivable			–				(197,553	)			59,864
Income taxes payable			–				36,412				(13,530	)
Accounts payable and accrued liabilities			150				6,601				1,400
Operating lease liabilities			2,784				(350	)			(778	)
Deferred revenue			(6	)			21,810				8,624
Accrued royalties payable			–				27,143				(4,637	)
Deferred grant revenue			–				(6,763	)			30,718
Other operating assets and liabilities			849				1,466				(2,603	)
Net cash provided by operating activities			2,694				22,690				244,584
Cash flows from investing activities:
Purchases of property and equipment			(3,997	)			(9,673	)			(58,452	)
Purchase of intangible assets			–				(5,000	)			–
Repayment (issuance) of related party loans			(1,783	)			1,783				–
Purchase of marketable securities			–				–				(274,710	)
Proceeds from marketable securities			–				–				27,608
Receipt of grant funding			–				–				32,621
Acquisitions, net of cash acquired			–				(87,643	)			(11,457	)
Long-term investments and other assets			–				–				(17,534	)
Investment in and loans to equity accounted investees			–				(19,247	)			(30,323	)
Net cash used in investing activities			(5,780	)			(119,780	)			(332,247	)
Cash flows from financing activities:
Repayment of long-term debt			(399	)			(19,942	)			(1,823	)
Proceeds from long-term debt			193				15,490				872
Proceeds from convertible debentures			–				89,990				–
Payment of contingent consideration			–				–				(2,550	)
Payment of liability for in-licensing agreement			–				–				(5,000	)
Short-term borrowings			387				(387	)			–
Issuance of common shares pursuant to exercise of stock options and other			25				1,000				4,615
Net proceeds from issuance of common shares			–				522,840				–
Proceeds from issuance of preferred shares – series A1 and A2 financing			(11	)			74,662				–
Net cash provided by (used in) financing activities			195				683,653				(3,886	)
Effect of exchange rate changes on cash and cash equivalents			–				–				(1,425	)
Increase (decrease) in cash and cash equivalents			(2,891	)			586,563				(92,974	)
Cash and cash equivalents and restricted cash, beginning of year			10,444				7,553				594,116
Cash and cash equivalents and restricted cash, end of year		$	7,553			$	594,116			$	501,142
Supplemental disclosure of non-cash investing and financing activities:
Property and equipment purchases in accounts payable			35				656				5,397
Right-of-use assets obtained in exchange for operating lease obligation			2,830				1,679				36,638
Purchase of intangible assets in exchange for in-licensing agreement payable			–				9,060				–

 

Contacts

Media: Jessica Yingling, Ph.D.; [email protected], +1(236) 521-6774

Business Development: Neil Berkley; [email protected], +1(604) 559-9005

Investor Relations: Melanie Solomon; [email protected], +1(778) 729-9116