Good afternoon. My name is Devin, and I will be your conference operator today. At this time, I would like to Welcome everyone to the Berkeley Lights, Inc Acquisition of IsoPlexis Presenter and Presentation. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. As a reminder, this conference is recorded. It is now my pleasure to turn the conference over to Suzanne Hatcher, Vice President of Communications and Investor Relations. Suzanne? Great. Thank you, operator. Good afternoon, everyone, Welcome to T oday's Investor Update Conference Call and Webcast. My name is Suzanne Hatcher, Vice President of Communications and Investor Relations at Berkeley Lights. I'm joined today by Siddhartha Kadia, Chief Executive Officer, Mehul Joshi, Chief Financial Officer, and Sean Mackay, Chief Executive Officer of IsoPlexis. Before we begin, I'd like to remind you that management will make statements during this call that are forward-looking statements within the meaning of federal securities laws. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated. For more information, please refer to the risks, uncertainties, and the other factors discussed in our SEC filings. Except as required by law, Berkeley Lights disclaims any intention or obligation to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. This conference call contains time-sensitive information and is accurate only as of the live broadcast on December 21st, 2022. During our prepared remarks this afternoon, we will reference a presentation that we have posted on the IR section of the Berkeley Lights website. If you're viewing this webcast, you'll be able to follow along live with our presentation. I'd like to turn the call over to Siddhartha. Thank you, Suzanne, and thank you everyone for joining us. As you saw this afternoon, we announced an important milestone in our efforts to fuel our transformation into a growing, profitable, and sustainable life sciences company. We've entered into a definitive agreement under which Berkeley Lights will acquire IsoPlexis. Before I go any further, I'd like to thank both the Berkeley Lights and IsoPlexis teams for their hard work to achieve this milestone. By bringing our two companies together, we will accelerate the revolutionary work our teams are doing to enable scientific breakthroughs. We are building on the complementary strengths of both organizations to create a premier functional cell biology company, which will be called PhenomeX. PhenomeX combines Berkeley Lights' live-cell functional biology with IsoPlexis' deep profiling of single cells. This will enable researchers to conduct deeper analysis of cell function for both research and clinical applications while preserving the cells of interest. Together, we will provide live-cell biology research tools that deliver deep insights into cellular function and new perspectives on PhenomeX, which are central to all questions in biology. We will each be better positioned than ever to create value for our employees, our customers, and our shareholders. Before we get into the details of many benefits we see from this transaction, I want to walk you through the transaction details and key terms of the merger, which you can find on slide six. Berkeley Lights is acquiring IsoPlexis in an all-stock transaction valued at $57.8 million. This follows a robust process by the boards of both companies, which included a significant period of engagement. IsoPlexis shareholders will receive 0.612 shares of Berkeley Lights stock for each IsoPlexis share they hold. Following the close of the transaction, Berkeley Lights shareholders will own approximately 75.2% of the combined company, and IsoPlexis shareholders will own approximately 24.8%. I'm excited to share that I will be serving as CEO and a member of the board of PhenomeX. I'm also pleased that we'll benefit from Sean's expected appointment as our chief product officer following the close, which we expect in the first quarter of 2023, subject to approval by shareholders of both companies and other customary closing conditions. Over the coming weeks and months, as we advance our integration process, we'll combine our management team in a way that reflects the strengths and capabilities of both organizations. With that, I'll turn it over to Sean to talk a little more about IsoPlexis and the work that they do. Thanks so much, Siddhartha. I'm extremely pleased to be here today. I share your enthusiasm about the future of our company. Turning to slide seven, as many of you know, IsoPlexis is a pioneer in the proteomic space A powerful contributor to the broader scientific community. We're known for our leading IsoCode cellular behavior multiplexing platform, and we are well-respected by researchers and clinicians for our scientific results and easy-to-use software and hardware. Since our founding in 2013, we've been accelerating the fight against the toughest diseases by reviewing what we call true functional biology of patient cells via proteomics and near-future transcriptomics. We have placed 277 instruments in the field, building a customer base that spans pharma, biotech, and medical centers, including 100% of the top 15 pharma companies and 81% of comprehensive cancer centers. Our IsoCode and CodePlex products are building momentum and play a key role in the translational medicine ecosystem. For the large swath of immunology researchers fighting cancer, IsoCode helps eliminate a critical bias on flow intracellular cytokine systems and ELISpot. Our customers recognize the extraordinary power of our technology, and we're pleased to have reached an agreement that reflects the value IsoPlexis has created. We're confident this is the best path forward to unlock the value of our extraordinary technologies together in solutions for all of our stakeholders, including our shareholders. Before I turn it back to Siddhartha, I do wanna thank IsoPlexis employees for their dedication, our customers for believing in our company, and our shareholders for their support over the last nine years. Finally, I do wanna thank Siddhartha and his team. I'm excited, they're excited, we're all excited about what the future holds and look forward to fighting these diseases and pushing the limits of scientific discovery as PhenomeX. Thanks, Sean. Turning now to slides eight and nine. When we spoke a month ago at our most recent Berkeley Lights Investor Day, I spent some time talking through the key areas of focus for us to reshape the company over the next three to five years. I want to spend some time now talking about how this transaction will accelerate our progress against every pillar of our strategic plan that we laid out, which should help you understand why we are so excited about this combination. First, we will be building a world-class team with a proven track record of profitably scaling life sciences tools and services companies. I've already talked a bit about our management structure and the work we'll be doing over the coming weeks and months. Importantly, our team is highly experienced in company integration and consolidating organizations. We are confident the process will be seamless and result in a strengthened company that benefits from the impressive talent of both organizations. Our next pillar is about prioritization of R&D ROI to increase focus and rigor on development initiatives. I've spoken a lot in the past about the extraordinary potential of Berkeley Lights technology and the need to be thoughtful in the use of our resources to accelerate innovation. This transaction brings together complementary portfolios that will extend our leadership through the functional cell biology continuum with technology that is unmatched in our industry. As a combined company, we are going to be laser-focused on executing on only the highest return initiatives. One of those focus areas will be to leverage the lower cost IsoPlexis platform to offer enhanced functionality from Berkeley Lights technology portfolio. We'll be well-positioned to maintain our advantage position through a formidable intellectual property estate, more than 600 issued patents. This will also advance our goal of delivering consistent commercial execution through a new sales structure, enhanced product portfolio, and pricing strategy. The combination will strengthen commercial execution with an enhanced geographic footprint and diversified customer base. Uniting Berkeley Lights' position in the Biopharma segment and IsoPlexis' foothold in the Academic segment, we'll be able to reach more and different customers across the globe with a strengthened sales team that is 75% larger than Berkeley Lights has today. We will be more focused on growing our recurring revenues. Turning to our next pillar, we believe that by forming this new combined company, we'll also be creating a platform for further consolidation in high-growth functional cell biology tools. We expect to achieve this in a number of ways. We'll take advantage of cross-selling opportunities to existing and new customers and grow our participation in a larger cell biology market with a wide range of tools and services. We also expect to drive significant productivity improvements as part of the combined organization by bringing together our R&D, G&A, supply chain, and manufacturing infrastructure, reducing costs and leveraging the talents and competencies of each organization. As we have been, we will evaluate M&A opportunities that will further accelerate profitable growth and leverage a combined cost structure. Lastly, we talked previously about our goal of generating positive operating cash flow by early 2025. We believe that this transaction will accelerate the timeline and support our ability to achieve positive operating cash flows at $150 million in revenue by 2024 instead. As you would expect, the synergies we see from this transaction are important, as Mehul will touch on it shortly. At a high level, we believe we can achieve cost synergies of approximately $70 million annualized by 2024. Broadly, as we have been focused on identifying opportunities that first accelerate profitable growth and leverage our current cost structure, this is how this transaction addresses the key elements of our M&A framework. In evaluating this transaction, IsoPlexis checks each of these boxes for us from expanding the markets we can serve to growing our offerings with complementary technology to strengthening our commercial infrastructure and driving synergies. In short, this transaction just makes sense. I wanted to spend a few minutes today talking about the elements underpinning the combined company's investment thesis and deep diving on a few areas. We already talked about what this will mean for us in terms of building a world-class team and just spoke to our ability to serve as a platform for further consolidation. I will focus on a few other points. Turning to slide 12, we have the only platform enabling functional proteomics, and further, we have an accelerated development path for our product portfolio. Our combination with IsoPlexis will create a balanced product portfolio and expands our install base. The integration of IsoPlexis' core technology will also lay the groundwork for Beacon Quest by allowing us to accelerate entry into key high-growth Academic Research segments, including immuno-oncology and functional biology. We've spoken previously about our progress towards developing the lower-priced Beacon platform for Academic segments. The low cost of IsoPlexis' platform and technology will accelerate that work. Turning to slide 13, the combined company will have substantially expanded access to a large cell biology market and customer base, which will include high-value translational research and academic customers. Berkeley Lights and IsoPlexis have overlapping commercial channels and significant customer complementarity. Combined, the company will have a stronger position in the Biopharma segment and a deep foothold in the Academic segment. I'm now going to turn it over to Mehul to deep dive on some of the financial of the new combined company. Mehul? Thanks, Siddhartha. Good afternoon, everyone. I will now cover the cost synergies we expect to achieve as a result of the merger. As Siddhartha mentioned earlier, our cost synergies will increase our profitability and accelerate the timeline to break even. We anticipate cost synergies of approximately $70 million annualized by 2024. As we evaluated this transaction, we identified synergy opportunities that included general and administrative cost efficiencies, prioritization of the R&D pipeline, taking advantage of our complementary R&D capabilities, and the thoughtful combination of our marketing resources and sales support functions, as well as manufacturing, supply chain, logistics, and facilities. Having completed a thorough diligence review, we are confident these goals are very achievable. We've also talked previously about our goal of generating positive operating cash flow by 2025. We believe this transaction will accelerate that timeframe and support our ability to achieve positive operating cash flow at $150 million in revenue by 2024 instead. Before we close, I wanna reiterate our excitement for our combination with IsoPlexis and what this means for us. By becoming one company, we will accelerate our progress across every pillar of our strategic plan and create a path of achieving positive operating cash flow earlier than we expected to as a standalone company. Together, we will be a premier functional cell biology company, bringing together Berkeley Lights and IsoPlexis respective innovative solutions. We look forward to what the future holds for PhenomeX. With that, I'll open the floor up for Q&A. At this time, I would like to remind everyone, in order to ask a question, please press star and then the number one on your telephone keypad. Our first question comes from Tejas Parekh with Morgan Stanley. Hello, this is Yuko on the call for Tejas. Thank you for taking our questions. You noted cost synergies of approximately $70 million annualized by 2024. Could you provide the breakdown on which OpEx line you see that mostly coming from? How should we think about the combined OpEx for the company with new launches expected next year? Hi, this is Mehul. We're not ready to break down the synergies by function yet. We have identified those. We will be validating them through our integration teams, you know, over the next 60 days or so. I will make some commentary on your question. You know, IsoPlexis and Berkeley Lights are both public companies. They have public company infrastructure, you know, to support reporting and a board of directors and so on. We will only need one public company infrastructure. We will be able to eliminate a large part of that, and that will come from typically general and administrative expenses. Looking at manufacturing, logistics, supply chain, you know, as we consolidate those functions, we expect to achieve, you know, significant synergies as we leverage our purchasing power and combine our activities within operations. On the R&D side, you know, what's exciting is that we'll be co-consolidating product roadmaps. That may yield some cost synergies. The more exciting part of that is, you know, we will be able to enhance our time to market on our products and services for commercialization. Finally, on the commercial side, I'd say we may get some synergies on the marketing and sales support functions, as I mentioned previously. You know, with our expanded commercial footprint, we expect to be able to drive, you know, some revenue synergies as we have complementary geographic footprints. At a high level, you know, that's how we're thinking about moving forward on the synergy front. Great. That was super helpful. Then as a, as a separate follow-up, could you elaborate on the plans for reorganizing and combining the two sales structures? How do you plan to do this to ensure that there's minimal disruptions during the transition? Yeah, it's a great question. The good news is actually there is just about enough salespeople between the two companies that we really need, and it's a matter of actually training our frontline salespeople with the product from each of those portfolio. There is not a whole lot of, you know, reorganization to be done. It's more about providing a deeper portfolio into hand for the salespeople. I think it's gonna go really well. It allows us to build a much stronger footprint in the non-U.S. Markets as we bring these two companies together. Great. Thank you very much. Our next question comes from Dan Arias with Stifel. Hey, guys. How's it going? It's actually Evan, I'm on for Dan. Congrats on the deal. As I sit here listening, I'm just kind of going through the math. I look at consensus numbers. You kind of, you know, you look at 2024 for the two companies combined, you're kind of at the $150 million mark already just based on, I guess, where consensus is. I'm just trying to understand. I mean, I understand that this kind of pulls forward, you know, your path towards profitability, but is that kind of the only reason for this deal? Are there like actual synergies where, hey, we have the Beacon, you know, they have the IsoPlexis product, and we can actually port some, you know, some capabilities from this machine over to this machine, and this makes the, you know, combined entity even more powerful or more, or better positioned than it was previously? That's my first question. Yeah, that's a great question. The most exciting part of our combined organizations have been our technology teams. The companies have been around eight, 10 years in parallel, developing similar but at the same time extremely complementary technologies. We believe that by putting Berkeley Lights' ability to keep the cells alive as well as our ability to export live cells into IsoPlexis' platform can be really powerful. Some of the greatest things about IsoPlexis' platform is, you know, customers love the ease of use and the software and the ability to really go from benchtop to a full analysis with the fantastic software suite that they have. We believe that the commercial footprint is expanded, but the R&D capabilities are gonna be quite complementary. Together, this kind of hits all the marks. It's a transaction that really brings the two companies that if you go back and track, trace the history back of life sciences tools industry, all of these companies that have now gone into mid-market or large cap space, they all grew up into this same kind of world where you create a commercial channel, you create significant R&D and innovation overlap. As you do that, you simplify your product portfolio as well. You don't try to go after growth for the sake of growth. We go after a higher quality growth. I think I've talked about this a lot. You know, we are focused on delivering higher quality growth versus growth for the sake of the growth. Really, we are focused on that operating cash flow positive much more than anything else, because we know that that allows us to really create significant value for our shareholders. I'm actually glad you ended with that. I mean, to that point, you know, we don't cover IsoPlexis. Just looking at kind of where consensus is right now, I mean, they're forecasting 40% revenue growth next year, I believe. I know you've done a good job since you've come in sort of resetting expectations. Do you kinda wanna take the opportunity or when should we think about you maybe potentially resetting expectations there? Just 'cause if I take consensus out to 2024, you're like well above $150 million. I'm just trying to understand where kind of maybe where you get closer to $150 million, whether it's coming from Berkeley or IsoPlexis. Hi, this is Mehul. I'll take a shot at that and then Siddhartha can add on. You know, the premise of the deal was, we did not build in a lot of revenue synergies in the short to medium term. We are, you know, really focusing on our cost synergies. We believe those revenue synergies will come over time, as Siddhartha mentioned around commercial execution as well as the R&D, you know, pipeline and product roadmap. You know, I say that as an initial point to also your initial question there. Then I think what as we, you know, work through to closing, we'll obviously have a much better understanding of, you know, the combined companies and, you know, a better sense of the financial modeling. I think what we'll do is probably provide more guidance, you know, as we approach that closing timeline. Okay. No, I mean, that makes sense. I mean, I guess, yeah, this is all kinda new and you're just kinda going through everything right now. Let me just talk about... I guess, my final question, if you don't mind. I know you post, you put up your product roadmap. It looked the same as kind of when during your analyst day, but obviously you added, I think you changed the name on the 2Q 2023 product, but I mean, obviously you added the IsoPlexis stuff. Is there anything, any update to the product roadmap based on this transaction or that's kind of like to be determined? I think for the Berkeley Lights standalone product roadmap for sure, we will be making some, you know, specific announcements as you see them on this chart that was presented there today, with a launch in Q1 and another launch in Q2. We are making strong, you know, significant progress. The Q1 launch is about to go out as we close the year out here, the Q2 launch looks very realistic in April timeframe. Given that, I think the only change on this is the future system where, you know, Berkeley Lights technology platform, as you know, is quite complex and has lots of bells and whistles, as I've described in the past. Allowing us to take the lower cost, simple to use, fantastic software suite platform that already exists with IsoPlexis and putting some of the key differentiated technologies from Berkeley Lights onto their platform, if you will allow us to, you know, introduce to cell biology market an amazing set of tools that either company alone wouldn't be able to do. Our intellectual property portfolio is completely complementary in this regard. It accelerates the timeline by which we would have to do that, the future system from a Berkeley Lights technology point of view, it will accelerate the timeline by several quarters. Gotcha. That's super helpful. That's all for me. Thank you so much and congrats again. Thank you. Our next question comes from Chad Wiatrowski with Cowen. Hey, guys. You have Chad on the line, in place of Steven Mah. Congrats on the deal. You know, you've spoken in the past about your prioritization of the high ROI R&D initiatives such as like AAV and cell and gene therapy. Just given Iso's expertise in cell and gene as well, can you speak to how this sort of accelerates that initiative? Yeah, I think that's a great question. Chad, I think you nailed onto something really important. I think as we think through kind of where the innovation in biology and impact from that innovation in biology is happening on human health, the next wave of innovation is really about the cell-based products and the gene therapy products. A significant amount of our clients, whether they are big pharma, small pharma or even translational medical centers, are all working towards that right now. Having IsoPlexis technology available to us, which already has a strong foothold into T-cell workflows of our customers, allows us to actually get significant commercial traction with the Beacon portfolio. Immuno-oncology centers is one target that we had found out through our research work in the last six months that we need to address. Providing a tool from Berkeley Lights platform into that segment. We are gonna do two things. We're gonna combine our technology with IsoPlexis technology and make a tool available in the longer term. Meanwhile, the customers who have a tool from either company could be provided a suite of tools to complement what they already have. That specific customer segment is the one that will be our focus. You know, translational research medical centers are almost all over the world, not only in the United States. They have become sort of the next wave of what I would call sort of small biotechs in the world because they have significant funding to do this kind of work. They have access to patient samples. We plan to enable, with the combined portfolio, a great amount of progress being made in that, the third wave of innovation, if you will, in cell and gene therapy. Yeah, super helpful. Thanks. just another question on the, on the commercial organization. Obviously, a pretty diverse customer base and, you know, geographic focus now. Iso had a couple reduction in forces this year. Do you feel like this now combined force is appropriate for the combined product portfolio? Maybe can you speak to the line of priorities for these new reps and if they have any type of efficiencies, just give me like 10 stats from the complementary. Thanks. I think that's a great question. As you look at the combined P&L in March when we provide it, as the transaction comes near the close, what you will see is there is significant available pool of resources for the combined commercial structure. As I said, we have just about enough R&D resources to really sell both companies' products, but geographic ability to reach our customers is a huge differentiator in this industry. That allows us to place people in each of the geographies locally. In a post-COVID era, especially for selling an instrument platform, it is an extremely important step for customers to get a demonstration and to buy an instrument with a lot of interaction with technical teams. We believe that the combined company will have a great footprint. We would actually collectively be able to add resources in certain geographies where we may not have had enough resources before, and that happens to be complementary in the case of Asia Pacific, which is mostly China, for Berkeley Lights has a very strong presence there, as you know. IsoPlexis has a strong and emerging presence there. We would have a combined force in India that is gonna be stronger. We'll have to make some further investments there. We're gonna make investments into the Asia Pacific that is not China, because we believe that's where there's a significant opportunity for both company to add commercial scale. Thanks again, for the color. Appreciate it. Our next question comes from Matt Larew with William Blair. Hi, this is actually Madeline Mollman on for Matt Larew. One thing that you highlighted in your Investor Day last month was the importance of moving towards a more recurring revenue model. I just wanted to see, how does this acquisition impact your long-term recurring revenue goals? Do you still expect to have about 2/3 of revenue be recurring by 2025, or will this accelerate that? I think in, Our current model actually suggests that actually we are in line with that. In fact, one of the things that is very remarkable actually is that even though the both companies have been pretty young and relatively new in the marketplace, collectively, we would have 400 instruments placed. That's a significant amount of install base to focus in and get that tailwind of the recurring revenue growth, both from the services and warranties that we provide for our instrument profile, as well as for reagents and consumables that people consume. The unique thing about the platform that IsoPlexis has built is that their instrument is quite flexible in introducing more consumables and reagents that go on that. We're able to capture more recurring revenue with combination with them. Great. Thank you. One thing that I noticed on this slide that, and that you've highlighted is that the IsoPlexis models tend to be lower cost than the Berkeley Lights models. As you try to increase your penetration with the Berkeley Lights models amongst the existing IsoPlexis customers, how are you going to be thinking about pricing? Yeah. I think our current platform in academic market will have a need for people who have significant need for using patient samples that allows them to do unique work for T-cell workflows or even oncology applications that no other platform can provide. From our early work in last six months, as I mentioned earlier, we believe that there's a market for a lower cost Beacon that will be launched for the academic market. As you heard us describe it in the, you know, Q2 of this year, we are going to launch that Beacon Quest, which will be focused on that academic market. It will not be at the same price point as our current Beacon for industrial applications, but it will be significantly lower cost than our platform, yet it will be a higher cost than IsoPlexis platform. It allows us to really address customers' needs by offering solutions that really meet their needs. Great. Thank you. Our final question comes from Mark Massaro with BTIG. Hey, guys. Thanks for the questions and congratulations on this deal. Obviously, it makes a lot of sense to combine two life science companies, and the synergies are readily apparent to me. I also like the fact that you used all cash... excuse me, all stock. It appears that you or at least at the end of Q3, you had $135 million of cash. It looks like you're going to absorb roughly a similar amount of debt in cash over at Iso. Siddhartha Kadia, you also indicated at your Analyst Day that you would contemplate acquisitions or at least you wouldn't rule them out. Given that you still have over $100 million of cash in the balance sheet, this looks to be nicely complementary. Should we think about, you know, you potentially building, you know, a more diversified tools company? You know, in other words, is it possible for you to consider some additional complementary M&A going forward? It's a great question, Mark. Look, I think our long-term vision here is to create the premier functional cell biology company, and that does indeed mean that we would be putting together more tools together. The entire life sciences tools industry is built on that. I don't think there is any, you know, sort of, question that there is a significant room for doing that. Of course, we have to digest what we've just done. We have to work together, you know, we will be opportunistic. As you know, the marketplace is right now, you know, interesting to say the least in the next 12 months. But we have a lot of work to do right now. You know, you should expect us to be laser-focused on delivering the $70 million of synergies that we talked about and delivering on our product roadmap. Yeah. Thanks. I know you were asked a question about Iso Consensus revenue, I don't expect you to guide for 2023 on this call. However, you know, it is pretty apparent that it appears that there's approximately $20 million of base revenue coming over. I assume that that will continue to grow. The install base has been growing at around 20-25 systems per quarter over at Iso. Is it fair to think that you're comfortable with, you know, at least $20 million of revenue from Iso next year and kinda expanding that install base at a similar run rate? I'm not gonna provide any forward guiding forecast on a business that we are just announcing that we are acquiring right now. However, what I would tell you is that the combined company is gonna focus on profitable growth, number one, and B, positive cash flow by 2024. We are not gonna measure ourselves on, you know, specific region or a specific instrument. We're gonna focus on building a company, building a great company, and we believe that between the combined footprint, we have plenty of levers to go do that. Okay. Maybe just one last nitpicky question. you know, your gross margins came in at 70% in Q3. Iso's came in at 50%. Last month at your Analyst Day, you laid out a target to hit 70% gross margins by 2025. Maybe help me think of how you can still get there or if that's still a target. Maybe point me to any pickup in recurring revenue that perhaps could bridge the gap there. Well, I think you answered your own question that, you know, we are going to be laser-focused on recurring revenue and both on the Berkeley Lights platform as well as the IsoPlexis platform. You know, we expect to hit approximately 70%, you know, gross margin on the Berkeley Lights side. As we begin integration, we'll evaluate, you know, the ability for IsoPlexis to do that. You know, they do have a manufacturing facility, and as throughput through that factory increases, more costs can be absorbed, and we believe that can enable gross margin expansion for IsoPlexis products. We'll work through all of that, you know, over the next 90 days. That sounds good. Congrats again, and happy holidays. Thank you. Happy holidays to you as well, Mark. There are no further questions at this time, which concludes today's conference. Thank you for attending today's presentation. You may now disconnect.