May 12, 2020 | 8:00 AM by Jay Kunstman |

Cryoport (CYRX) – Road to Clinical Recovery

Cryoport is a life sciences services company providing temperature-controlled logistics and end-product fulfillment to the biopharmaceutical, reproductive medicine, and animal health markets. Using proprietary information technologies, the company’s personnel can monitor conditions of the internal shipping environment, location and other specified variables for each shipment in real-time. The information is recorded and archived for each shipment for scientific, quality assurance and/or regulatory purposes in a secure cloud-based system that can be accessed globally to provide a complete audit trail.

We first covered this name last August on the Home Page highlighting the strength of its commercial business. At the time of the write-up, we highlighted that in the last quarter, the commercial segment jumped a whopping 374%, aided by Novartis (NVS) and Gilead (GILD), specifically from KYMRIAH and YESCARTA.

Fast forward to last week, May 7th, when the company reported revenues of $9.8M in Q1, an increase of 47% from the first quarter of 2019. This was, again, driven by record revenues from their commercial agreements supporting Gilead’s YESCARTA and Novartis’ KYMRIAH, which contributed $2.9M, representing a 110% increase Y/Y. Management also indicated that in April, Gilead renewed its agreement with the company, which covers Gilead’s entire portfolio of therapies in development as well as YESCARTA for all temperature-controlled solutions. ”We expect the ongoing rollouts of both YESCARTA and KYMRIAH to patients in the Americas, EMEA, and APAC to drive continued ramp in activity, as related to our agreements supporting these commercial products.”

Clinical Trials – The company also posted strong growth in new clinical trials, increasing to 465 from 383 Y/Y and 436 Q/Q. Breaking that down even further, the number of active Phase I trials increased to 208 from 195 in Q4, the number of active Phase II trials increased from to 195 from 185, while the number of active Phase III trials increased to 62 from 56 Q/Q. B. Riley FBR analyst Andrew D’Silva, in a post-earnings note, would comment, “While being utilized in more clinical trials is a core growth driver for CYRX, having a customer’s offering move through the clinical trial process can be even more impactful, as the company estimates annual revenue of $15k–$75k for every Phase I trial, $75k–$150k for every Phase II trial, and $200k–$1M for every Phase III trial in which its customers are actively enrolling patients.”

Also, during the quarter, CYRX added 17 new biopharmaceutical clients and was chosen in April to provide comprehensive logistics support for six potential COVID-19 treatments and vaccines.

Suspensions – The company indicated that 56 of its clinical trials were suspended in the quarter due to clinical trial sites not able to accept patients under COVID closures. However, it should be noted that no customers terminated trials. Needham analyst Stephen Unger said that of these suspensions, 16 are in Phase I, 26 in Phase II and 14 in Phase III. As a result, revenues in Q1 were obviously impacted (amount not provided) and continue to impact Q2 revenues. But, CYRX noted some recent signs of improvement, as local restrictions on mobility are removed within the United States.

Pipeline – The company previously announced that it expects five commercial approvals and ten additional BLA/EMA filings in 2020 relative to its three customers today (Kymriah, Yescarta, Zyntelgo). Additionally, management indicated continuing visibility of filing activity. According to Janney analyst Paul Knight, “The company expects to post Zynteglo logistics revenue in 2H20 and we believe that OTL-200 (Orchard Tx), Liso-cell (Bristol), Ryoncil (Mesoblast), and Ide-cell (Bluebird) are four possible customers reaching approval and revenue in 2020. The company believes that an approved therapy may generate $8-12 million in revenue, at the midpoint.”

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