Welcome, day one of the TD Cowen 44th Annual Healthcare Conference. I'm Dan Brennan. I cover tools diagnostics here. Really pleased to be joining with me on stage with the senior management team of Quanterix. To my immediate left is Masoud Toloue, who is the CEO, and to his left is Vandana Sriram, who is a recently appointed chief well, not recently, but, Chief Financial Officer. So, I have a series of questions. Feel free to try to send emails to me if you like, and I'll, I'll try to take a look as we go through it. So first off, welcome and thanks for being here. Thanks, Dan. Great to be here. Awesome. Maybe, maybe just to, I thought that a good way to start it was just on the turnaround that's been implemented here on the manufacturing side, what that's enabled, kind of the journey that you've been on. So maybe you can just walk us through a little bit for the, I mean, many in the room are probably familiar, but just kinda where did it start? Where are you today? Kind of, you know, just kinda give us a flavor for kinda what it's gonna enable for the company. Yeah, Dan, we kicked off a big strategic program in August of 2022. And there, you know, when we took a look at where Quanterix was in the sort of spectrum of opportunity and possibility for where ultrasensitivity would be important in the market, we saw that, hey, Quanterix was very translational in nature and that a lot of folks were going to or were using us in research but wanted to begin using us more and more into translation. We, you know, the biomarker they identify in research, how is that clinically relevant? And to do that, you know, folks were wanting to look at longitudinal studies, big patient cohorts. And so we began and we kicked off a program to include a lot of the, you know, specifications you need in an assay to be able to meet that market. So that was the view that, you know, Quanterix's, you know, horizon and opportunity is pretty widespread and not just in the research market. We were gonna do something more in diagnostics, and these translations. To do that, we kick off a big transformation starting with the assays. We added additional specs, quality, robustness, manufacturability into the assays to be able to meet the market demand that we see in Neurology. You know, from a financial standpoint, obviously, it really gross margins, you know, kinda hit a low point. Now they've really been climbing back up. Also you've, you know, really slowed down even on kind of on the instrument side what you were doing. So just give us a little flavor for obviously, you had a good 2023. You know, the outlook for 2024 was favorable. Just from a profitability standpoint, how has this assay rework, kind of enabled the margin profile today, and kinda what does it mean as we look forward? Yeah, so from a manufacturing standpoint, it's been great. We've seen, you know, over 1,300 basis points in margin expansion through the year, mainly on the operation side. When we make the platform, we can do it in a or the assays, we can do it in a lot more scalable way. We start the manufacturing of the program of the of an assay, and you have less scrap, less need to redo the assay. And so, from that standpoint, it's become a lot more efficient, and that's directly improved our margins. The second key guiding criteria in the transformation had been, you know, not just what are the benefits from an operation standpoint, but what are the customer benefits? And there, you know, our customers are now, you know, getting lots that have, you know, longer expiration dates, right? Our customers now see these new assays with that are on the shelf easier to get good lot-to-lot controls for these long studies, long-term studies. And probably something that we talk less about is the ability to really the things that we've done to build a product development engine, meaning all of that work in operations has translated to our R&D team being able to identify a marker that's really interesting in the market, put it together as an assay, and release it for a trial or a clinical study in a very efficient and fast way. Mm-hmm. And in, you know, in terms of the 20 assays that you're guiding to, kind of introducing 20 new assays, like, how does that 20 stand in the relative size of your assay base today? And are these assays like, how did you produce these first 20? Kinda, what kind of impact will these 20 assays have? Yeah, I think, you know, we hadn't done a lot of releases at Quanterix. There were a few key assays that made up, you know, a big part of our revenue. And now, we like to say, you know, when we come up with these assays, we don't do it in a conference room. So our best product manager is our accelerator program. Pharma, Biotech, people around the world come to our accelerator program with the latest biomarkers. We develop those assays and services for them. And then we also look at that data and the publications that are out there, and we say, "Hey, what are the next set of ultrasensitivity-powered biomarkers that are gonna be important for Neuro, for immunology, and oncology?" We curate them. We look at the hotspots, and then we make them into and those make up the 20 that we have planned for this year. So I think the impact is good. There's a lot that's happening in Neurology. If you look at the last two, three years, the phosphorylation site of p-tau has become critical. You know, there are additional phosphorylated markers in the tau world that are important. There are people now looking at Alzheimer's and different mechanisms. They're looking at tau pathology, not just the amyloid pathology. They're looking at clearance in the brain, and the relationship of a few of these markers together and what impact that has for the patient. So, you put some of these together, and I think we have a interesting lineup of assays coming out in 2024. And maybe just stepping back for a moment before we dig into some of the Alzheimer's and the Neuro, but just in terms of the Simoa technology itself, just, you know, there's you know, we had Bruker up here earlier, and, you know, they're one aspect of proteomics, but there's a lot of excitement over kind of proteomics, right? And there's a lot of companies here who are tackling stuff around the mass spec. And you guys are unique with your technology. Maybe just speak a little bit about the technology itself, kind of, kind of how you think it fits going forward in the competitive landscape. Like, what makes it unique? What's differentiating kind of what the kind of what the moat is if, you know, if there is one around it? Yeah, so the unique part about the Simoa technology is that we look at things digitally. All other protein detection systems in the market are looking at analog. And so, you know, on the platform, we look at these hundreds of thousands of femtoliter wells. And there, there's a single bead for each well. And that gives us a digital signal. So by looking at this on an individual bead-by-bead basis, we can really separate the amplitude of signal versus noise floor, at a much more elegant way than other technologies that are bulk, you know, big well, mix of proteins and analytes that have to be looked together and then sort of in an analog way compared to a reference standard. So by doing that, we can see the first signs of molecules, versus, "Hey, there are no protein molecules in the blood. Now there are first few molecules, in the blood. Simoa can detect that. So if it's an albumin or if it's something that's heavy in the blood, that's not really of interest to ours. There isn't, you know, anywhere of 30 platforms that can read that. When it requires sensitivity, researchers use that platform and are excited about the technology we offer. So maybe we can look at your guidance for 2024. You know, you guided $139 million-$144 million. That's the research-only part of the business. You know, I think there's still some pressure on CapEx. And, you know, again, you're not including any clinical at this point. So maybe just 2023 was a very strong year for the company. You kinda beat numbers pretty handily each quarter, both on the top line and the margin side. Just how would you characterize what's incorporated in the $139 million-$144 million, and what are the levers that you think could drive upside to that, or just, you know, kind of what kinda cushion is baked into that? Sure. So we definitely felt really good about where we ended 2023, and we're entering 2024 with a good bit of momentum. I'd say in terms of how we built the guide and what we expect for the year, just like everybody else, we do expect to start the year, you know, somewhat constrained on CapEx and still seeing that in instruments. But what's been interesting for us is even in this CapEx-constrained environment, we're still seeing the demand for our Simoa technology run very strong. And the reason we know that is because we see a lot more activity in our accelerator lab. We're seeing a lot more in terms of quoting volumes. There's a lot of studies going through. We have over 45 studies going on right now. So the pace of activity is still high. It's just not gonna show in instruments. It'll probably show more on the service side. On the consumable side, that's probably the biggest beneficiary of all of the work we did in 2023. We ended the year with having, you know, kind of our old SKUs as well as our new SKUs on hand, ready to go. In the early part of 2024, we'll be very focused on helping our customers make the transition, and, you know, we will certainly prioritize that over anything else. We factored that into the guide as well in terms of, you know, we expect Q1 to be largely the same as Q4 and then start to see that pace really pick up. But, definitely, all of the benefits of that transformation should also come through. That's broadly how we frame the revenue guide. The margin guide largely follows revenue, so very much aligned with revenue. There is, you know, a lot of potential for leverage, but, it's gonna take some time to realize. But we should see some good margin acceleration after the first quarter. Every single quarter, there should be a bit of a step up. And what would be, just maybe one follow-up on the margin side. So the significant leverage, how much of that is just continuing to scale the capacity you have? How much of it's the mix? What are the biggest drivers of that leverage? Yeah, so we got some good benefit from mix in the 2023 year. You know, we've historically been heavy instruments. In 2023, we were heavier services and consumables. So that mix benefit is now baked into our run rate, if you will. Mm-hmm. From this point onward, it's really about leverage, and it's about getting all the benefits of the transformation. You know, we make larger lots. We're more productive, more efficient. All of that will start to come through. Got it. So maybe just flipping over to the clinical side of the business where I think there's just, obviously, a tremendous amount of excitement. Maybe just starting off, just what, you know, in terms of you could size this opportunity so many different ways. And I guess when you begin to incorporate some revenue contribution, we'll get a better feel for how you think the ramp will occur. But just, you know, how would you try to characterize obviously, the top-down's massive, you know, 8.5 million people with MCI. You can rule out, rule in monitoring. Just what are the key facets of as we think about the opportunities set ahead for Quanterix in the next three - five years? What are some of the, you know, the kind of the, you know, the opportunities we should be considering? Yeah, so I was kinda taking a look at the time to see at what point we would get into the clinical side. And we're 10 minutes in into the clinical, which is good. Yeah, it's good. But before we jump fully, you know, fully in, I you know, Dan, I think the what you know, the echo of Vandana's comments, we're super excited about research, pharma, clinical studies. And we think that as you look at the horizon we were just having this conversation with a couple of investors a few minutes ago. It was that 20 years ago, where was oncology? Oncology was, "Hey, take a tissue, look under a microscope, and then bombard with radiation." Now look where oncology is. You got MRD, liquid biopsies, early detection. We believe that Neurology is on the doorsteps of what will be another, you know, amazing 10 years and new discoveries and opportunity. 20 years ago, there were in the last 20 years, two disease-modifying therapies in Neurology, over 20 years. Now, Quanterix, started as a company in 2007. We've had 2,500 publications in that time period. In the last three years, there are now four disease-modified therapies on market, all of which were powered by Simoa, Quanterix biomarkers. And now, you know, a couple Alzheimer's, opportunities. So we're very bullish on Neurology. We think it's the next 10 years will be a NeuroDecade, similar to what oncology's had. And we're very poised with this transformation and the things that we've done, to be able to supply that market and that opportunity. Now, now getting into the clinical side, Quanterix is a unique organization. You start in research. Pharma is very interested. And now in the diagnostic setting, how do we power that therapy? To that point, we have a very interesting diagnostics. We're starting to have an interesting diagnostics business where we can look at these individual markers that'll play a role or an important role in Alzheimer's disease. And we're investing capital. We are taking this very seriously. We've put a commercial team in the market. And we think that it starts with the Alzheimer's therapies that one of them that is in the market, then one hopefully will soon be in the market. Mm-hmm. So, yeah, I mean, we can get to the size of the, well, actually, let me ask a different question then. So, if you looked at five years and you said, "Here's our split research-clinical from a revenue basis," would you venture to guess kinda what that would look like? I mean, that's a tough one. I, I would say, you know, five years from now, Quanterix has still a very robust research and pharma business that's growing at a strong clip, double-digit. And that's on its own a robust business in itself. Mm-hmm. Mm-hmm. On the clinical side, you know, if I think about, "Hey, who can measure these markers early? Who can provide a marker where it's the very earliest stages of detection all the way to late stage and have that full wingspan of measurement?" I think that's Quanterix today. We're taking steps to enhance that moat for tomorrow. Mm-hmm. you know, in t five-eight-year horizon, I see a strong diagnostics and clinical business that is especially focused on Alzheimer's. Mm-hmm. Okay. What, I mean, there's so many ways to tackle it. Maybe just starting with what are the key milestones in 2024, I guess, 'cause there's a lot going on, right, in terms of both clinical evidence, kinda commercial launch, you know, the strategies you're deploying, like, for instance, with the five health networks. Just give us a flavor for what are the things investors should be tracking to kinda monitor the pace at which, you know, you can begin to see some real revenues get incorporated into the business? Yeah, I mean, first, starting with the research side, you know, we talked about the 20 assays that you referred to. A lot of those will be introduced initially in the research for pharma trials. And so there, we expect some benefit, you know, on the consumable side and accelerator with additional programs. And cadence of that launches are important to us. Mm-hmm. We think we have that product development engine, and that, that'll be a big, core part of the focus. Second thing, you know, we've been talking about as, you know, as the heart of the company being tools, what are we innovating on? And so the DNA of the company is innovation. And what's the next technology? And when we talk to folks in the Neurology space, it's, "Hey, a few markers, you know, four or five markers are sufficient for Neurology." But when Immunologists and Oncologists are using our platform, they'll ask us, "Hey, I'd like to do, you know, two times that many markers that we're looking at using your platform." And so there, we're looking at opportunities from a tech stack of improving the way you could use multi-marker and, in a lossless way, spread sensitivity across each of those markers equally, to provide a unique solution. So that's on our roadmap for 2024. We talked about discussing, you know, some of that at the end of the year. And then on the Diagnostic side, we talk, you know, "Hey, you know, today, we announced the Breakthrough Designation with our 217. We have these as available today as an LDT in a CLIA laboratory. The next phase, we have two clinical trial readouts on our prospective studies, Bio-Hermes and the CANTATE trial. Those are gonna be very important. We're hoping there's a new a second therapy in the market for the disease. We also talk about reimbursement. You know, I think the today, it's out of pocket, but we're looking as a company at how we can get these tests reimbursed, and hopefully that's a 2024 discussion. Yeah, so maybe just with that, I mean, the question I had here was, you know, discuss a little bit more in detail the reimbursement strategy, both in terms of, you know, going through FDA, seeking Medicare approval, just maybe if you can elaborate a little bit on, like, you know, what's been disclosed and, you know, what's coming up this year. Yeah, so we've applied for a CPT code for amyloid pathology. Hopefully, we get the results of that later in the year. And then pricing, hopefully, by the end of the year, we get a sense of what a single marker. Mm-hmm. Would look like, from a Medicare perspective. So that for us is a 2024 thing. On the FDA side, these tests are available today. The Hermes and the CANTATE trials are gonna support our FDA and the work we're doing. Getting the breakthrough designation, hopefully, means an accelerated pathway. There's an unmet need for blood-based testing, and that's why we got that designation. So, you know, focus on the reimbursement for today and then the IVD status for tomorrow, I would say. Mm-hmm. In terms of, so if you get the CPT code, you'd get that issued what, like, in by, like, June or something like that? Is that when you'd plan to have that? Yeah, I think I think the summer timeframe is the right way to think about it. And then towards the end of the year from a pricing standpoint. So it gets issued, and then it gets priced. And that is, that's a national coverage. Is there just how does it work with Medicare with that? I apologize. Yeah, no, that would be likely an LCD, so local coverage determination, with our MAC. And we would then, you know, have an opportunity to go back 12 months or so for reimbursement. And I think that hadn't been reimbursed. Got it. And this would be on 217, 181? Just. This would be on our 217 test. Got it, 217, right. And 181, you're not gonna seek to get reimbursement? You won't seek Medicare approval or coverage on 181? Yeah, I think, you know, I think 181 was, it is an incredible marker. People still use the marker. I think when you look at the evidence between 217 and 181, it's not even in the same horse race. Mm-hmm. 217 can detect the pathology a lot earlier than p-tau 181. It's probably a better marker for continuous testing. Mm-hmm. It's right now the only one that's recommended by NIA-AA. Mm-hmm. And, you know, and in terms of the Bio-Hermes and the, CANTATE, if I'm pronouncing correctly, trials, so that's also that's multi-marker, correct? Correct, yeah. So, kinda what are we gonna get from those trials and? We've begun some good work now. The Bio-Hermes and the Amsterdam UMC trials powered our LDT. Mm-hmm. So phase one, we had some top-line data that reported out. We had an order of, let's say, 1,000 patients being looked at. And the Bio-Hermes trial's interesting. It's a 17-site, diverse population. The Amsterdam cohort was good. We put those together, and we validated the results for our LDT. So we had, you know, accuracy, you know, in the 90th percentile versus PET and CSF. And then we had high sense and spec for that assay. So we're already using the initial data from those trials for our LDT. The second half or second part of that is, how do you look at this in a multi-marker setting? In other words, as we're speaking to Neurologists, there are situations, Dan, where a patient comes into the office and has memory issues. They'll get our test or some other test, and there's no amyloid pathology. You know, then what? Or what, what is it? And so there, we believe that a multi-marker could provide a differential diagnosis for that patient and suggest, "Hey, is this Lewy bodies or frontotemporal dementia where there might not be as much amyloid pathology?" And so we think there, a multi-marker, could be interesting. We're also looking at, "Hey, does four markers or five markers gonna provide a better result than 217?" And as we start some of that data comes in and the viability of a four or five marker in the market, we'll get a sense from these clinical trials and then decide whether that's an additional LDT likely this year or an additional IVD filing, in 2025. But the IVD filing would be on 217 this year, and the multi-marker could be following up this year. Correct, yeah. Yeah, we expect the multi-marker data for, to be more towards the end of the year. So our focus right now is on 217 as a marker. Got it. How do you think about the competitive landscape in testing? I mean, obviously, there's a bunch of players that are doing it, a bunch of players that are leveraging, kinda working with you. So it's a bit of a, you know, matrix, if you will, some kinda, you know, with their own antibodies using Simoa, some really leaning on you. Just kinda walk us through. You already led off with the uniqueness of the Simoa technology, but there's a lot of big companies also going after the space. It's obviously a large space, but just, you know, how would you characterize the competitive landscape? Yeah, our view there on the competitive landscape and the opportunity is that, look, our in diagnostics, for amyloid testing and Alzheimer's testing, our number one mission is build the global testing infrastructure. And we'll do whatever it takes to build that global testing infrastructure, which means enabling partners to offer the test, enabling hospital enablement to offer the testing to patients directly. They can do tests sent out to our CLIA lab here in Boston. We'll provide results. We're ready prepared. We've set up the CLIA laboratory. We're taking LucentAD testing now. But it's not, it's less of, "Hey, we're just gonna do it in our lab, but let's get this in the hands of as many people as we can, whether it's a reference lab or a hospital, to be able to offer the testing on a broad basis." Our view, and I think this aligns as well with those who are working on the therapy, whether they're, it's the pharma companies or the physicians who are meeting patients and need an additional tool, is that blood is the first bar. Blood is the first screen. It doesn't make sense to have PET or a lumbar puncture as the first mechanism of a diagnostic test. We believe that's blood, and that could overtake other modes of diagnosis in the future. So, from a competitive landscape, I tell our competitors they should be using the Simoa platform as well. And we enable that. So, you know, we think it's a big market. There are more than just Quanterix and Simoa offering blood tests. But I would say, of all the blood tests, p-tau 217 is the clear differentiator for amyloid pathology. There's only two companies today that I'm aware of that offer a p-tau 217 test. There's a mass spec company, and then there's ourselves. And then beyond that, reading p-tau 217 with the Simoa platform is like doing a brisk walk. It doesn't even challenge the system. You add four or five markers to that, and you begin in some settings, when somebody adds, you know, four or five markers, you dilute the bandwidth for that assay. With ours, we're not diluting that bandwidth. You know, we have it's like five internet lines for five Netflix channels. So, so that, I think, is a differentiator. And then I think we've talked about, "Hey, what could be an extra differentiator? Dry blood spots." And so we have a vision for the future. It starts with 217, but, there are a lot of steps beyond that. And I think, there should be other players in blood. It's a big market. We should be one of the leaders in the market. I'll check my email. And in terms of FDA, so you would look to file on 217. Like, you would submit when? Like, is the data all done? Are you still waiting for additional data? Do you have any color around that actual package? Where are you with FDA in terms of communication on kinda what they want? Yeah, we sent to the FDA our planned indication for the diagnostic test and some of the plans on how we would get to the indication. We talked about the test. We talked about the sensitivity, and some of the initial data that we're currently seeing. And I mean, I think it was a good validation that companies receive the breakthrough designation when there's an unmet need. There's a breakthrough technology in the market. There's an unmet patient need and benefit and patient need, and there's just nothing out there that's like it. And so with the therapies coming in the market, I think the FDA's view is, "There needs to be blood here, and we're gonna designate Quanterix or give this designation." The next steps are taking a lot of the work we've done on the LDT, on the clinical trials there. These are the FDA-grade prospective clinical trials, and putting them together as the results come in, for a submission or continuous submission, throughout 2024. Got it. Pricing? I know whether it's a rule-out or a rule-in. You'd be seeking this is a rule-in test with this CPT code that you've been pulling after? That's the way we've designed it is unique. And it's a two-step, two-cut-off process. So the test can be used in rule-out mode as well as rule-in mode. And there, we have two cut points such that above a threshold, it's high likelihood that the patient has amyloid pathology. We have an indeterminate zone. And then below that threshold, it's unlikely that they have the pathology. So our view is, in the indeterminate zone, we say, we recommend follow-on PET or CSF. So we're incorporating the tools that physicians are currently familiar with, to start. And then we think, in the future, over a few years, with more data, Neurologist setting and perspective is gonna be, "Why am I doing anything else other than blood testing? Mm-hmm, right. And then obviously, you have the one guideline that's recommending 217. But, like, after you get FDA, I guess you would expect this more in 2025 with FDA and Medicare when things would be lined up. Is that reasonable? I think beyond 2024 is the right way to think about it, from an IVD perspective. Mm-hmm. Hard to say exactly, you know, provide exact timing. That, that's unclear. Right. But, like, would you need additional guidelines? You really need to make a dent in the market? You think just having FDA and Medicare, you'll start to see real uptake? Yeah, I mean, you know, we, yeah, I would say that, when the team goes out today and they speak to the Neurologists at these hospitals, they're familiar with p-tau 217 and our blood testing. There's very little education that has to happen at that high level. They're familiar with the technology. They're understanding the importance of blood and how this is a valuable tool, in the market. So I think as we spread from, you know, the topline hospitals that are providing the assays and providing the drug and thinking about prescribing drug, then there might be some more education. The IVD certainly helps with that, as we look at it at the bottom part of the pyramid. Like, have you shared? I know, obviously nothing in guidance. But when you think about two years from now, there's this many tests, you know, there's this many drugs being administered. Blood could be X percent of the market. Is it 5%? Is it 10%? I mean, five years from now, I think you'd probably be a lot higher. But, like, eventually, we'll get there. But is there any framework today to think about that? Yeah, that's an interesting question. I think, you know, blood will become more and more available. I would be disappointed if in two years, you know, blood was you know, every Alzheimer's patient wasn't getting a blood test. Mm-hmm, interesting. Okay. That's really, you know, like, when, when you think about, you talked about the multi-marker. That could be something, you know, if you get 217 approved, the multi-marker would just be maybe two or three years later. If that really becomes that vibrant and the data's that much better, that could just swap in, I guess. Or maybe it's a higher-priced alternative. Or how would it displace 217? Yeah, so the multi-marker would likely include 217. Got it. And then it would try to enhance beyond where 217 is. And I think it's a little early to say, "Could it be more sensitive than 217?" This is an open question. We're gonna learn within our clinical trials. "Could it give you more information about the patient diagnosis, follow-up?" And there's also some perspective that you could look at, you know, treatment monitoring and the effects of the treatment in the brain. As you know, neurofilament light has been a general brain health proxy of what's happening in the brain. And so I think between that and some of the other Neuromarkers, it just adds more insight, not just from the clinical diagnostic perspective, but also during the clinical trials. know, we hear about 181 and 217, but there's a whole plethora of other biomarkers that are being tested on the patient, just to see which one of these are best for measuring efficacy, best for measuring patient health, over a period of the treatment. Great. Well, I think we're almost out of time. Maybe just kinda the wrap-up. So then, what's the message you'd wanna leave investors with today about Quanterix? You know, we're like, Vandana and I are super and the whole Quanterix team. We're, you know, the team has been, you know, working incredibly hard, and focusing a lot of effort and resources into the opportunity of the future. Everyone at the company has a strong conviction on the next 10 years will be Neurology years. We've gotten the organization and the company aligned, both to deliver from a research standpoint, but also now to make sure we're doing everything we can to get our tests out to patients and people in the environment while ensuring that we're continuing to innovate, you know, as a five-year, 10-year horizon as opposed to just this year or next year. Terrific. Well, thank you for being up here. Thanks for being in the audience. Appreciate it. Thanks, Dan. Thank you. Take care. Great to be here. Thank you.