OmniAb Reports First Quarter 2024 Financial Results and Business Highlights

Rhea-AI Summary

OmniAb, Inc. (NASDAQ: OABI) reported financial results for Q1 2024, highlighting a revenue of $3.8 million, research and development expenses of $14.6 million, and a net loss of $19.0 million. The company signed three new license agreements and has 80 active partners with 327 active programs. Financial guidance projects similar expenses in 2024 as in 2023, with sufficient capital to fund operations. Partner highlights include advancements in clinical trials, patent approvals, and promising data on various programs.

Positive

• OmniAb expanded its partnership base by signing three new license agreements, totaling 80 active partners and 327 active programs, showing growth and collaboration opportunities.

• The company's partner highlights include advancements in clinical trials for programs like Batoclimab, IMVT-1402, M9140, Acasunlimab, and Sugemalimab, showcasing promising developments in various therapeutic indications.

• OmniAb's publication on genetically engineered chickens producing functional antibodies demonstrates innovation and potential for antibody discovery, highlighting the Company's commitment to cutting-edge research and technology.

Negative

• OmniAb reported a decrease in revenue for Q1 2024 compared to the same period in 2023, primarily due to lower service revenue and milestone recognition, resulting in a net loss of $19.0 million.

• The increase in research and development expenses and general administrative expenses for Q1 2024, compared to Q1 2023, indicate higher costs despite revenue decline, potentially impacting profitability in the short term.

Insights

Financial Analyst

Reviewing OmniAb's financial performance for Q1 2024 reveals a significant decline in revenue from $16.9 million in Q1 2023 to $3.8 million in the corresponding quarter of 2024. This drop is attributed to a one-time milestone payment of $10 million recognized in the previous year and the completion of discovery work on certain ion channel programs, which indicates a reduction in service revenue. With R&D expenses increasing slightly due to higher personnel costs and G&A expenses remaining relatively flat, the company's net loss has widened from $6.1 million to $19.0 million. This raises concerns about the company's ability to manage its burn rate effectively, despite their assurance of having sufficient capital for the foreseeable future. The cash reserves at $69.0 million appear solid, but investors should monitor the cash burn rate closely, especially since the company does not expect a significant change in operating expenses or cash use for 2024, apart from the absence of the TECVAYLI milestone payment received in 2023. Looking ahead, the forecast for decreased cash use in 2025 is encouraging but would need to be substantiated by the successful progression of their partnered pipeline.

Biotech Industry Analyst

From an industry perspective, OmniAb's strategic focus on expanding its portfolio through platform license agreements is noteworthy. The increase to 80 active partners is a testament to the company's ability to attract collaborations, which is essential for a biotech firm leveraging its technologies for growth. The OmniAb-derived programs in clinical development or being commercialized, which now number 31, demonstrate a maturing pipeline that could eventually contribute to revenue growth and mitigate current losses. However, given the nature of biotech R&D and the time it takes to bring products to market, near-term financial benefits from these programs may be limited. It will be essential for investors to pay attention to the progression of key clinical trials, such as those for batoclimab and other potential registrational programs for IMVT-1402, as positive outcomes here could considerably enhance valuation prospects. The patent issuance for IMVT-1402 by the USPTO extends protection until 2043, which is significant for long-term intellectual property value but has little immediate financial impact.

Medical Research Analyst

OmniAb's recent scientific achievements, including the publication demonstrating the engineering of chickens to produce functional single-domain antibodies (sdAbs), reflect innovation that could have long-term implications in the antibody discovery sector. sdAbs are gaining traction due to their small size and versatility, particularly in the development of multi-specifics and CAR-T cells, which are at the forefront of targeted cancer therapies. While this innovation is not directly linked to immediate financial gains, it positions OmniAb as a forward-thinking player in the biotech field, potentially contributing to its competitive edge and attractiveness to partners. Such technological advancements are important for maintaining a pipeline of novel therapeutics and may lead to more significant financial outcomes in the future as these technologies are capitalized upon.

Conference Call with Slides Begins at 4:30 p.m. Eastern Time Today

EMERYVILLE, Calif.--(BUSINESS WIRE)-- OmniAb, Inc. (NASDAQ: OABI) today reported financial results for the three months ended March 31, 2024, and provided operating and partner program updates.

“The OmniAb team continued to make great progress this past quarter in advancing and expanding our portfolio and partnership base. We added three new platform license agreements in the first quarter, bringing our total active partners to 80, net of attrition,” said Matt Foehr, Chief Executive Officer of OmniAb. “We have built our company upon a differentiated suite of technologies and a highly scalable and leverageable business model, and our growth during the past 18 months reflects the strength of our offering to the industry. We’re off to a strong start in 2024 and we look forward to continued progress by our partners and expansion of our technology as the year progresses.”

First Quarter 2024 Financial Results

Revenue for the first quarter of 2024 was $3.8 million, compared with $16.9 million for the same period in 2023, with the decrease primarily due to the recognition in the 2023 period of a $10 million milestone related to the first commercial sale of TECVAYLI^® (teclistamab) in the EU and lower service revenue in the 2024 period as a result of the completion of discovery work on certain ion channel programs.

Research and development expense was $14.6 million for the first quarter of 2024, compared with $13.8 million for the same period in 2023, with the increase primarily due to higher personnel costs. General and administrative expense was $8.3 million for the first quarter of 2024, compared with $8.2 million for the same period in 2023.

Net loss for the first quarter of 2024 was $19.0 million, or $0.19 per share, compared with a net loss of $6.1 million, or $0.06 per share, for the same period in 2023.

As of March 31, 2024, OmniAb had cash, cash equivalents and short-term investments of $69.0 million.

2024 Financial Guidance

OmniAb continues to expect operating expense in 2024 to be approximately the same as in 2023, as the Company is now staffed and resourced to leverage the future growth of the business.

OmniAb continues to expect its cash use in 2024 to be relatively similar to its cash use in 2023, excluding the $35 million TECVAYLI milestone payment received in 2023. Given the expected progression of the existing partnered pipeline, OmniAb expects its cash use in 2025 to be substantially lower than in 2024. OmniAb’s current cash balance and cash from operations are expected to provide sufficient capital to fund operations for the foreseeable future.

First Quarter 2024 and Recent Business Highlights

During the first quarter of 2024, OmniAb signed three new license agreements including ImmunoBiochem Corporation, the University of Georgia and a stealth Boston-based venture-backed start-up. As of March 31, 2024, the Company had 80 active partners and 327 active programs, including 31 OmniAb-derived programs in clinical development or being commercialized.

First quarter 2024 and recent partner highlights include the following:

Batoclimab

• Immunovant reported that global Phase 3 clinical trials of batoclimab (anti-FcRn) in myasthenia gravis (MG) and thyroid eye disease (TED) are progressing and are on track for topline data readout in the second half of 2024 (MG) and the first half of 2025 (TED). Initial period 1 data from the Phase 2b clinical trial in chronic inflammatory demyelinating polyneuropathy are expected in the second or third quarter of 2024.
• HanAll Biopharma announced that in collaboration with Immunovant, the Phase 3 clinical study is progressing in generalized myasthenia gravis in Japan. HanAll also reported that a clinical trial notification was approved to initiate a Phase 3 clinical study of batoclimab in TED in Japan.

IMVT-1402

• Immunovant announced plans to initiate four to five potential registrational programs for IMVT-1402 (second-generation anti-FcRn) during its fiscal year ending March 31, 2025. The company also plans on initiating trials in 10 indications for IMVT-1402 over its next two fiscal years.
• Immunovant announced that the United States Patent and Trademark Office has issued U.S. Patent No. 11,926,669 (“the ‘669 patent”) for IMVT-1402. The allowed claims cover composition of matter for the binding sequence of IMVT-1402 to FcRn, method of use of the antibody for treating autoimmune disease, as well as methods for its manufacturing. Not including any potential patent term extension, the ‘669 patent will expire on June 23, 2043.

M9140

• At the American Association for Cancer Research Annual Meeting, Merck KGaA presented data on M9140, a novel antibody-drug conjugate with topoisomerase 1 inhibitor payload targeting carcinoembryonic antigen-related cell adhesion molecule 5 (CEACAM5) expressing tumors.​ M9140 demonstrated high potency, strong antitumor activity and bystander effect in preclinical models.
• A first-in-human Phase 1 study to evaluate the safety, tolerability, pharmacokinetics and preliminary clinical activity of M9140 in patients with advanced solid tumors is ongoing.

Acasunlimab

• Genmab expects to announce acasunlimab (GEN1046: PD-L1 x 4-1BB) Phase 2 data in second-line non-small cell lung cancer (NSCLC) in the first half of 2024.
• A poster titled “Acasunlimab (duobody-PD-L1x4-1BB) alone or in combination with pembrolizumab in patients with previously treated metastatic non-small cell lung cancer: Initial results of a randomized, open-label, Phase 2 trial” will be presented at the American Society of Clinical Oncology (ASCO) Annual Meeting 2024 at 9:00 a.m. Central time on Saturday, June 1, 2024.
• In addition, Genmab plans to initiate a Phase 3 study of acasunlimab in second-line NSCLC in 2024.

Sugemalimab

• CStone announced the National Medical Products Administration of China has approved the supplemental biologics application for sugemalimab (Cejemly^®) in combination with fluorouracil and platinum-based chemotherapy as first-line treatment of unresectable locally advanced, recurrent or metastatic gastric or gastroesophageal junction adenocarcinoma with a PD-L1 expression (Combined Positive Score [CPS] ≥5). Sugemalimab is the first PD-L1 monoclonal antibody approved for this indication.
• CStone also announced that the results of the progression-free survival final analysis and the overall survival interim analysis in the registrational GEMSTONE-304 study for unresectable locally advanced, recurrent or metastatic esophageal squamous cell carcinoma were published in Nature Medicine.

OmniAb scientists published a peer-reviewed paper in the Journal of Immunology demonstrating that chickens can be genetically engineered to produce functional single-domain antibodies (sdAbs). This modality, produced naturally by camelids, has gained popularity as a small, robust and highly versatile building block for antibody discovery, especially in constructing multi-specifics and CAR-T cells. These data supported the feasibility of the Company’s next-generation transgenic chicken OmnidAb™ that produces fully human stabilized sdAbs. The OmnidAb platform was launched during the fourth quarter of 2023.

OmniAb will highlight some of its high-throughput single cell screening xPloration™ data at the 20^th Annual PEGS Boston Conference and Expo, where Bob Chen, Ph.D., Senior Director, Discovery Systems, will give a presentation titled “Deep Screening in Harmony with Artificial Intelligence for Bispecific Antibody Discovery” at 12:20 p.m. Eastern time on Wednesday, May 15, 2024.

The Company also expects that multiple partners will be presenting data from programs developed with OmniAb technology at the ASCO Annual Meeting taking place May 31 - June 4, 2024.

Conference Call and Webcast

OmniAb management will host a conference call with accompanying slides today beginning at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss this announcement and answer questions. To participate via telephone, please dial (800) 549-8228 using the conference ID 08922. Slides, as well as the live and replay webcast of the call, are available at https://investors.omniab.com/investors/events-and-presentations/default.aspx.

About OmniAb^®

OmniAb licenses cutting edge discovery research technology to the pharmaceutical and biotech industry to enable the discovery of next-generation therapeutics. Our technology platform creates and screens diverse antibody repertoires and is designed to quickly identify optimal antibodies and other target-binding proteins for our partners’ drug development efforts. At the heart of the OmniAb platform is something we call Biological Intelligence™ (BI), which powers the immune systems of our proprietary, engineered transgenic animals to create optimized antibody candidates for human therapeutics.

We believe the OmniAb animals comprise the most diverse host systems available in the industry. Our suite of technologies and methods, including computational antigen design and immunization methods, paired with high-throughput single B cell phenotypic screening and mining of next-generation sequencing datasets with custom algorithms, are used to identify fully-human antibodies with exceptional performance and developability characteristics.

Our proprietary transgenic animals, including OmniRat®, OmniChicken® and OmniMouse® have been genetically modified to generate antibodies with human sequences to streamline the development of human therapeutic candidates. OmniFlic® and OmniClic® are fixed or common light-chain rats and chickens, respectively, designed to facilitate the discovery of bispecific antibodies. OmniTaur™ provides cow-inspired antibodies with unique structural characteristics for challenging targets. OmnidAb™, is an in vivo platform for the discovery of single domain antibodies based upon a human VH scaffold that affinity matures in a chicken host environment to provide a functionally diverse immune repertoire unavailable from mammalian systems. Our proprietary technologies are joined with and leverage OmniDeep™, which is a suite of in silico, AI and machine learning tools for therapeutic discovery and optimization that are woven throughout our various technologies and capabilities. Additionally, an established core competency focused on ion channels and transporters further differentiates OmniAb’s technology and creates opportunities in many important and emerging target classes.

OmniAb technologies can be leveraged for the discovery of a variety of next-generation antibody-based therapeutic modalities, including bi- and multi-specific biologics, antibody-drug conjugates, CAR-T therapies, targeted radiotherapeutics, and many others.

For more information, please visit www.omniab.com.

Forward-Looking Statements

OmniAb cautions you that statements contained in this press release regarding matters that are not historical facts are forward-looking statements. Words such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or continue” and similar expressions, are intended to identify forward-looking statements. The forward-looking statements are based on our current beliefs and expectations and include, but are not limited to: the ability to scale and leverage our business model; the growth prospects of our business; the expected performance and expansion of, our technologies and the opportunities they may create; the ability to add new partners and programs; scientific presentations and clinical and regulatory events of our partners and the timing thereof; the sufficiency of our staffing and resources; expected operating expense and cash runway; and the future balance of cash, cash equivalents and short-term investments. Actual results may differ from those set forth in this press release due to the risks and uncertainties inherent in our business, including, without limitation: our future success is dependent on acceptance of our technology platform and technologies by new and existing partners, as well as on the eventual development, approval and commercialization of products developed by our partners for which we have no control over the development plan, regulatory strategy or commercialization efforts; biopharmaceutical development is inherently uncertain; risks arising from changes in technology; the competitive environment in the life sciences and biotechnology platform market; our failure to maintain, protect and defend our intellectual property rights; difficulties with performance of third parties we will rely on for our business; regulatory developments in the United States and foreign countries; unstable market and economic conditions, may have serious adverse consequences on our business, financial condition and stock price; we may use our capital resources sooner than we expect; and other risks described in our prior press releases and filings with the SEC, including under the heading “Risk Factors” in the our annual report on Form 10-K and any subsequent filings with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and we undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Partner Information

The information in this press release regarding partnered products and programs comes from information publicly released by our partners.

OMNIAB, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
	March 31, 2024				December 31, 2023
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	19,060			$	16,358
Short-term investments		49,947				70,625
Accounts receivable, net		4,045				3,844
Prepaid expenses and other current assets		3,665				4,074
Total current assets		76,717				94,901
Intangible assets, net		152,055				155,467
Goodwill		83,979				83,979
Property and equipment, net		17,957				18,249
Operating lease right-of-use assets		19,362				19,884
Restricted cash		560				560
Other long-term assets		1,926				2,185
Total assets	$	352,556			$	375,225
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	3,556			$	4,411
Accrued expenses and other current liabilities		4,027				7,068
Current contingent liabilities		891				1,303
Current deferred revenue		5,530				6,848
Current operating lease liabilities		3,516				3,486
Total current liabilities		17,520				23,116
Long-term contingent liabilities		3,178				3,203
Deferred income taxes, net		8,737				11,354
Long-term operating lease liabilities		21,418				22,075
Long-term deferred revenue		279				862
Other long-term liabilities		31				30
Total liabilities		51,163				60,640
Stockholders' equity:
Preferred stock, $0.0001 par value; 100,000,000 shares authorized at March 31, 2024 and December 31, 2023; no shares issued and outstanding at March 31, 2024 and December 31, 2023		—				—
Common stock, $0.0001 par value; 1,000,000,000 shares authorized at March 31, 2024 and December 31, 2023; 117,388,789 and 116,859,468 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively		12				12
Additional paid-in capital		359,726				353,890
Accumulated other comprehensive (loss) income		(17	)			50
Accumulated deficit		(58,328	)			(39,367	)
Total stockholders’ equity		301,393				314,585
Total liabilities and stockholders’ equity	$	352,556			$	375,225

OMNIAB, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except per share data)
		Three Months Ended March 31,
			2024				2023
Revenues:
License and milestone revenue		$	716			$	12,646
Service revenue			2,766				3,958
Royalty revenue			319				315
Total revenues			3,801				16,919
Operating expenses:
Research and development			14,551				13,759
General and administrative			8,337				8,195
Amortization of intangibles			3,412				3,369
Other operating expense, net			54				49
Total operating expenses			26,354				25,372
Loss from operations			(22,553	)			(8,453	)
Other income:
Interest income			975				1,324
Total other income, net			975				1,324
Loss before income taxes			(21,578	)			(7,129	)
Income tax benefit			2,617				1,029
Net loss		$	(18,961	)		$	(6,100	)
Net loss per share, basic and diluted		$	(0.19	)		$	(0.06	)
Weighted-average shares outstanding, basic and diluted			100,755				99,158

 

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OmniAb, Inc.

Neha Singh, Ph.D.

investors@OmniAb.com

Twitter @OmniAbTech

(510) 768-7760

Source: OmniAb, Inc.

FAQ

How many new platform license agreements did OmniAb add in Q1 2024?

OmniAb added three new platform license agreements in the first quarter of 2024.

What was OmniAb's revenue for Q1 2024?

OmniAb reported a revenue of $3.8 million for the first quarter of 2024.

What was OmniAb's net loss for Q1 2024?

OmniAb reported a net loss of $19.0 million, or $0.19 per share, for the first quarter of 2024.

How many active partners does OmniAb have as of March 31, 2024?

OmniAb had 80 active partners as of March 31, 2024.

What are some partner highlights from Q1 2024?

Partner highlights from Q1 2024 include advancements in clinical trials for programs like Batoclimab, IMVT-1402, M9140, Acasunlimab, and Sugemalimab.

What notable publication did OmniAb release recently?

OmniAb published a paper demonstrating genetically engineered chickens producing functional antibodies, showcasing innovation in antibody discovery.