OmniAb (OABI) Q2 2024 earnings summary

Executive summary

• Achieved strong business growth in Q2 2024, expanding to 83 active partners (a 30% increase over two years) and 333 active programs, with 32 in clinical or approved stages as of June 30, 2024.

• Added new agreements with Daan Bio, Topaz Therapeutics, and Redwood Bioscience, and expanded relationships with HanAll Biopharma, 92Bio, and Memorial Sloan Kettering.

• Notable clinical progress includes new trial initiations, regulatory milestones, and European approval of sugemalimab.

• Business model centers on technology access fees, milestones, and service revenue, with long-term value from royalties on partner product sales.

• Continued investment in R&D and platform innovation, with ongoing losses expected as the company grows.

Financial highlights

• Q2 2024 revenue was $7.6M, up from $6.9M in Q2 2023, driven by higher service revenue and a $1.3M acceleration from a discontinued GSK program.

• Net loss for Q2 2024 was $13.6M ($0.13/share), improving from $14.7M ($0.15/share) in Q2 2023.

• Operating expenses for Q2 2024 were $23.9M, down from $26.4M year-over-year; R&D expenses were $13.9M, and G&A expenses decreased to $8.0M.

• Cash, cash equivalents, and short-term investments totaled $57.2M as of June 30, 2024.

• Gross margin for Q2 2024 was 68%, up from 49% in Q2 2023.

Outlook and guidance

• 2024 is on track for record new partner additions and licenses, with operating expenses projected to be slightly lower than 2023.

• Cash use in 2024 expected to be similar to 2023 (excluding a $35M milestone in Q1 2023); 2025 cash use expected to decline significantly.

• Current cash and operations expected to fund the business for at least 12 months.

• Long-term growth expected from royalties as more partner programs reach commercialization.