Talis Biomedical (TLIS) 5 Aug 222022 Q2 Earnings call transcript

Good day and thank you for standing by. Welcome to the Talis Biomedical's Business Update Conference Call. At this time, all participants are in a listen-only mode. After the speakers presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. to Faucette, conference Investor SVP like speaker to Relations. now Emily today, Corporate would hand over the your I Communications and

Good you. thank afternoon and

Investors Joining financial the A press company Executive of a at business XX, our page our Rob XXXX. the copy Financial the released me release -- quarter talisbio.com. for accessed Roger June and Chief today, that and on for website can Moody, Chief Earlier Officer. update today are results of the Officer; our be Kelley, ended

could Before we of would to events are like this you and laws. remind from cause forward-looking differ make to materially that involve federal that the will remarks anticipated. actual get started, statements results call meaning I that risks These management or the those securities statements within material during uncertainties

information the in release issued uncertainties today. regarding the section entitled and these press Additional Statements in Talis appear risks Forward-Looking

to whether filings a other more or disclaims SEC X, statement August or as list X, please and XXXX. events contains intention Risk and of and time including the on description, For by law, the the required broadcast on revise is update complete Except over any of obligation section its turn the in live filed company's with XXXX to like the projection August call XX-Q or sensitive accurate the This With filings. conference Factors of Talis any company's see financial I forward-looking new future information otherwise. to information, because or call only Rob. would as that,

for joining thank Emily. Thanks us. you and everyone, Good afternoon,

to to we success. update plan, to an Talis quarter are our over will commercialization Roger that long-term the today's During and to review I second call, provide financial I it our for on results. position turn taking steps Then manufacturing, will changes

and have modifications made supply addressing manufacturing processes, months several our controls through scale notable quality to to manufacture Over at the progress conformance. last we challenges

and Specifically, markets we sustainable to criteria. these the at decided and leverage we low-cost infectious within time consecutive workflow software. accurate the in stand-alone platform acceptable innovative and the financial field to for assay value need. investigational our yields have have execute $XXX our increased assay on million broad potential platform's economic cartridge and widespread Talis to our to routinely acceptance Recognizing outweigh commercialize United respect evolved, given use discontinue meet COVID to mission and disease EUA. shift we point-of-care. investment and of and would of physical invalid the testing moment growth assets deliver are into we the With instruments, the our return pass limit range on One our believe this we seeing We highly commercializing gain platform test, we now in the system diagnostic on to user at the equity pass our evidence One high Today, for required demand under and put to Based COVID scale in and have our that first target. that are to instruments to the at-home markets use testing States investment we manufacture the to in with feedback rates these acceptance can further COVID believe flexibility. can for this with molecular have differentiated a With improvements, where plan cash experience mind in in are ready lots components, we outcomes high-performing Talis an at we cartridges health in improve approximately increased

can more our onboard sets market respect turnaround There profit the market. convenience the revenue decentralize in by in settings markets. One can high-value to current than on and sexual in prompt markets tests Patients in is believe women's sample growth be from immediacy to competitive unserved a we looking opportunities with and address in platform to health needs offerings will are sexual the time believe greater general. with and testing and and is us where testing are allows we advantages, opportunity our largely large preparation beyond of women's point-of-care where We This decision rapid US health the testing for significant market and and COVID at resources this $X us comfortable Importantly, the treatment allow point apart focus long-term CLIA-waived margins. to testing care greatest testing physicians opportunity prescribed. Talis deliver and increasingly the unmet billion

physician Additionally, we more to have of enabling to commercial model infrastructure point launch more and call commercial efficient focused a expansion One. drive customers, a serve will Talis and

Talis health. development on plan address with as road the women's UTI and made System vaginosis, we infectious we've to progress tests In panels. leverage the we of ahead, near-term, One HSV, important continued system at focus map the the by Looking beginning made date the studies scale. In some critical such to product test summary, to additional with panels our progress manufacturing inform One Talis CT/NON-GAAP, multiplex other we to investigational followed our sexual STI by diseases in development future the have efforts most executing will and of field

We sexual on growth are focus markets and higher health generate that we believe overtime. margins women's to committed and will

and strategy in it growth will turn best quarter and We deliver this now, financial value. shareholder our through impact the more us to help second I'll results. focused to long-term Roger walk the over change expect direction financial this of

health, actions resources are bringing To in functions, spans just and of we focus a team in this over be allow XXX reduction cost us these current realizing employees. of into with The these further total combined funding force in expenses from of XXXX. taken We of this all plan will expenses. start sexual new $X of to million the and of charge compensation to the the under extend reductions XX% approximately Based other benefit women's XXXX. fourth that timing in annualized spending believe include in to the expect savings our $X Thanks to and reduced we a our on Act, we action notifications million implementing our align $XX reduce infrastructure. with other Overtime The million. quarter, consulting plan in manufacturing, as restructuring Rob. our inventory, amount further the quarter in spending will WARN

from Our over cash million million XXXX. and target million between is burn decrease beginning our rate to $X $X $X in monthly

of cash under were driven quarter Turning our to in financial in as now June equivalents $XXX the million test second was XXXX results, by unrestricted antigen revenue cash We and recognized mostly which XXth second $X quarter sales. million.

the were $X XXXX. of of second expenses, primarily $XX same manufacturing in period scale-up investments last compared were operating spending quarter second million million to and completed. year. decreases These million $XX the $XX compared expenses largely the expenses in same in Turning for to to and driven second quarter compared development million our of the million million, period total are XXXX. that quarter the general XXXX, quarter to $XX were by $XX administrative Research were in Selling, second

Talis quarter received CE COVID One Finally, we Mark and in second System. assay our the for

opportunities guiding any and While are we if revenue be are don't in not we immediate near-term launch Europe plans they to have ex-U.S. to opportunistic intend to profitable. distribution with

to for turn Rob, Now, remarks. closing back call over the I'll

health progress the have to and we it sexual for announced team put our ability necessary, leveraging up forward the in today, turn on to Thank long-term We of over map changes our to months at the look you, are I'll The Roger. I'm to to our made success. With a past it manufacture these for scale. questions. product operator extremely to we six markets. that, road the Talis proud path work accomplished women's open advance demonstrating

[Operator question comes Our Instructions] Vatnsdal from Rachel with first JPMorgan.

is Your line open. now

the the Thanks Hi. question. Casey broader I taking plan one of de-prioritized there health. is for a the an flu still it's sounds guess understanding Rachel. at to women's here had opportunity and combo on on pipeline taken develop panel? COVID first or is least larger the think This side generally that was respiratory respiratory my we behind the out which the for like I getting market

your just that So yes, any on panel. thoughts color around

answer great Rob. question question. is This to a that Sure. Yeah. and it's Happy

are -- assay. optimizing And had have the final I submitted the ABC recently, August, in in our steps the XXX(k). think We we of for pre-submission

not But do approach down what given this seeing I whether want a take with right now, health quite the we that into it's have commercialize to wait-and-see that's market. And that. road. could opportunity the CT/NG question with us we is come have this and that see obviously where far. women's so, assay we And the think to huge something have And So that going COVID the play market? we're we for to a or is we're

based said that Got at What broadly, it. XXXX guess And what cash you can elaborate on And this more you evidence on then you evidence then, the having on? manufacture I can runway. scale? on is

Just Will manufacturing curious CT/NG or allocated. the that kind will towards to burn be to R&D develop shift to test? where of that continue it for be processes, is going on, now

I'll Roger. is take that question. This

of in scale-up you sure terms manufacturing a know time So that manufacturing first making the of we our as optimized. our spent was quite evidence bit for

acceptance we frequently ability instruments measure within and success we've a high-speed our success acceptance for here lots passing of on been threshold measure yield we that pass on testing. our has and our consumable basis. also so the seeing pass acceptance criteria well And based testing the increased acceptance in And our on that based And automated to first also to exceed the our line. and consistent

quite the that to bit It's manufacture a now we we of scale. processes. a So, refine there's have efficiencies of now continuing can and driving that at that feel question evidence we

But was platform think also women's now further we lower at our on scale support and will the Your in second of menu to manufacturing to question in refinement, It's the obviously will focused sexual expansion a commercialize we them. the until needs I where health. invest albeit investment areas continue development about be. of

want on is the decreased rates to progress. Emily. jump also before the talked cartridges. manufacturing since in on We're And just we've it Casey about seeing invalid this I

the had we're the are seeing that about talked striving the that sometimes to we level at that in for at we experienced increased are we levels target X% imbalance EUA the and So, future. our also study consistently

Okay. Got it.

the there's lots then the instrument valid There are first things. three consecutive there's rate yield. pass and There's

three us So, collectively, of that that give we the evidence pieces confidence. the are have those

one. That's you. just helpful. And guess then Got I last

you. you have Thank strategic Just pursued alternatives guys exported for any wondering sale? if

Yes.

come And evaluated of So, we've to I'm for believe happy across. health best and we're options the Talis. to for options other forward an us But and women's path of that number done that. behalf continue here really the at believes into they moving we going the those of is Board us answer to Obviously, extensive on evaluate space. shareholders a certainly we as have the review

question Derik next Our of from America. comes with Bank De Bruin

Your now line open. is

out, Great. comments give markets. opportunities This if sexual think where to Ryskin want about of the lines I realize it's I on you Thanks on I'm Derik. meaningful the the the women's could -- CT/NG health for question. those on getting assay wondering seeing start when How for now on Mike could taking is follow-up other and any for years your path but some and just and hump? from time the in are us any we product we you revenues? sort thoughts of over still should

Yes.

main fact don't that and revenues but women's our CT/NG, to first Obviously, health lines time CT/NG I focus. going think assay. the our start give let's we're on is specific with So, it's

in optimizing to go once we it year. we -- submit our get assay studies from verification the this how design there. and well, help the are and step If of that design with pre-sub And the on from We being the feedback us the in next goes to all then of plan inform process us currently validation. forward will QX

that and talent Thanks. And across this that are retaining working talk update head to you as the of how count how sort about some going forward steps development reprioritizing of the appropriately you hurt ensuring today's progress? timelines then and the that will ensure to reduction business are right you you're these organization of, parts you're entire Okay. Sort going of that the of funded? aren't further be cross-cutting

plan financial mentioned a the have that capital million cash. in we we think I and Well, place in $XXX Yes.

the assets we We to in four space. have second reduction move we because women's we And we sexual of exactly did now right that the have need we the our force health everyone's get and we the and feel So, and can forward just And the we sample leverage us turnaround that best system the company our realm. that evidence did Board in thing amount there. people of do months. combined the time that funds think platform testing for manufacture of can given prep unique the the which really we to in can that this the used that that molecular multiplexing health believe capabilities is and have with rapid innovative the high-performing women's and we niche fits a is

combination capital going us think in the is that we talent opportunity here the we we of So, the get that have and to the there. market have have we the

Okay. And then last one.

COVID-XX last just of in on back It a due of COVID the the comments disease lot like landscape the Your to the to has how changed initiative to and seems testing want of and circle that. months. landscape the was couple evolving

an six it months, back thoughts seeing option being significant sort sort is resurface year, permanently it, and we and for that. of, ramp testing increased years. this next reverse in to, X.X COVID demand Just of, waves hypothetical Is the step one mothballed? or it up, Just start on if do

Yes.

risk for longer of think, of fluid market sure. panel the more go pay I EUA more an single on And it standalone thing a EUA. would the of, have how takes The for like and the both. come for sort as that be that back because here attention ABC one likely strategy we XXX(k), to, be market to always the appetite I be would a rebound would and path would our the COVID we're we combination what's in long would is, market the to the depending that for on to in there say is going of to opposed

sense. All you. Make much. Got right. so Thanks

from Our Massaro next Instructions] [Operator question Mark comes BTIG. with

Your line is open.

for questions. much Hey, guys. very you the Thank

rates On the are invalid understanding is better. you that rates my XX% I targeting invalid or cartridge think below

that did seeing you're there. You indicate improvements

you for at you a time? any kind this is are there give way where of sense us So to for

Sure.

is So Roger. Mark, this

below is seeing that We have been frequently actually actually EUA X% -- X.X%, we the And -- well. seeing below routinely our been which come our target results below get we've was. in to where pretty and as

pretty So invalid good rates. we're feeling about

in And We the our also continue us in in a of consistency and IUO PPA comfort starting that it gives field. accuracy given quality see to our NPA. studies

feel addressed these And now so on challenges working key of efficiency. and we like we've are many and refinements

Yes, that makes sense.

the from a have a probably expected is health are market the big COVID more getting little we in COVID a unpredictable. lot people Testing that ago. little tooth women's still is that think But understand and is is a happening. than I So sick observed People of COVID. I market long two years still

context So have correct and in the I me an of in you just place guys -- EUA you EUA. believe having

maybe to not declined whole little commercial have if with bit the guess, canning be I a as I'm launch it and for invalid test operation? kind the So of struggling rates launched why your a could opposed smaller team just

Yes. is Hey, Mark. This Rob.

be did a launching of that market. think could we the I this a product, question. the reassessment we got great realizing When data it's we

were We found interested salespeople to at the agreements molecular out time. testing. of at not them very this but had additional we basis daily the there signed handful out them of on only folks. And few had they some talking looking customers went know, testing, to were you We initial of we us. majority that instrumentation found had in back that had antigen out of that that with As a evaluation a

drive less average the day where learned continuing the be volume than their site. molecular testing most also than in tests five per product antigen We XX% many these less also even sites would see And on the is the in offering. we of interested them of ABC to adding to

all add quite this a the And So point pretty to molecular increased price picture. down bit. poor antigen market, that pricing then down coming in the painted see we're competition to of a come starting

we seems we the there a add cost right this So be don't have in shot that growth and commercialization, women's at given look long-term the great. and differentiated you like at have do health then market feel economics it if that thing and all some like together can do. of And the look to great really

that antigen distributor last makes of of I you revenue given to discontinue commentary my about your you are COVID $XXXXXX the guess, sense. or Yes, test past this that for question planning quarter? perfect generated sales

Yes.

in We a will is sell can, whatever couple we more we have which that of inventory, not left plan continuing dollars program. million if on we do purchasing but or

Okay. for Thank That’s me. you. it

Thanks, Mark.

conference remarks. the turn to like closing now for Rob would I to back

for joining and today your for in Talis. all time Thank you Bye. and us interest

for conference This you concludes today's Thank call. participating.

may disconnect. You now