Earnings Call Transcript
OmniAb, Inc. (OABI)
Earnings Call Transcript - OABI Q4 2023
Operator, Operator
Good afternoon, and welcome to OmniAb, Incorporated's Fourth Quarter and Full Year 2023 Financial Results and Business Update Conference Call. As a reminder, this conference is being recorded. I would now like to turn the call over to Kurt Gustafson, OmniAb, Incorporated's Chief Financial Officer. You may begin. Thank you.
Kurt Gustafson, CFO
Thank you, operator, and good afternoon, everyone. As you said, this is Kurt Gustafson, and I want to thank you all for joining our fourth quarter and full year 2023 financial results conference call. There are slides to accompany today's prepared remarks, and they are available in the Investors section of our website at omniab.com. Before we begin, I'd like to remind listeners that comments made during this call will include forward-looking statements within the meaning of the federal securities laws. These forward-looking statements involve risks and uncertainties that could cause actual results to be materially different from any anticipated results. These forward-looking statements are qualified by the cautionary statements contained in today's press release and our SEC filings. Importantly, this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, today, March 20, 2024. Except as required by law, OmniAb undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call. Joining me on the call today is Matt Foehr, OmniAb's President and CEO. During today's call, Matt and I will provide highlights on the company's operations, partner and technology updates and our recent financial results. At the conclusion of the prepared remarks, we'll open the call to questions. With that, let me turn the call over to Matt.
Matthew Foehr, CEO
Thanks, Kurt, and good afternoon, everyone, and thanks for joining our fourth quarter and full-year 2023 conference call. As we kick off the call today, I'd like to mention that our clear mission here at OmniAb is to enable the rapid development of innovative therapeutics by pushing the frontiers of drug discovery technologies. We do this within a pure-play licensing business that is partnering-focused and that's designed to be efficient, scalable, highly leverageable, and that we believe is now poised for growth to meet what we see as an enduring and global need in the pharmaceutical industry. Our technology offering addresses the most critical challenges of antibody-based drug discovery. We have a highly differentiated suite of technologies that are proven and increasingly leverageable. Better industry success rates and other factors are driving an acceleration of antibody-based investment by the pharmaceutical industry, and we think we're well-positioned to meet increased demand for cutting-edge, antibody-focused discovery technologies. OmniAb grew significantly in 2023, making substantial progress across key elements of our business. This included expansion of our partnership base and our pipeline of partner programs, advancements of key late-stage programs by some of our partners, and global expansion of our business development team. We now have BDT members in the U.S. and in Asia, based out of Singapore, and in Europe. We're focused on and dedicated to continued innovation and executed extremely well on that in 2023 with two successful new technology launches, including OmniDeep, which is our suite of in silico AI and machine learning technologies and capabilities that are woven throughout our technology stack and that marry extremely well with the biological intelligence of our transgenic animals. In November, we launched OmnidAb, which is our latest example of a novel transgenic animal, and I'll talk more about that shortly. We had an impressive list of achievements in our first full year as an independent public company, but our focus remains on pushing the boundaries of technologies to continue to meet the needs of our partners now and in the future. We have an increasingly efficient internal technology innovation engine that helps frame how we believe will create long-term value for all of our stakeholders. And building on this momentum from 2023, we're looking forward to continued growth in the year ahead. Here now on slide number five, you can see some of our business metrics, and these graphs in many ways speak for themselves and I think clearly show that 2023 was another year of substantial growth and progress in our business. Despite sector-related and macro headwinds last year, our key performance indicators continued to perform extremely well. Our active partners grew to 77 from 69 a year ago, representing a 12% increase. Our active partner programs also grew by 12%, with an increase to 325 from 291. And lastly, our active clinical and approved programs increased by 23%, as we had 32 at the end of 2023 compared with 26 at the end of 2022. I want to stress that all of these numbers here are net of attrition, and I note that attrition is obviously natural and it's expected in pharmaceutical discovery and development. I'll now talk about our partnership base in a little more detail here on slide number six. 2023 was highly productive in new partner additions as our number of active partners continued to grow net of attrition. We saw multiple factors driving this expansion, including platform visibility and clinical and commercial validation of our technologies, an expanded business development and marketing presence that's backed by our cutting-edge science, and our new technology launches. As we continue to focus on licensing to align our interests with our partners, we're attracting and bringing in a diverse set of partners to bolster the next wave of discovery and preclinical candidates advancing to the clinic. Moving now to slide number seven, here we're providing a further breakdown of our new platform licensing deals from last year. We signed 10 new licenses in 2023, and today we're disclosing new platform deals with Enable Life Sciences, as well as one with a start-up company that were both signed in the fourth quarter, along with a previously disclosed Big Pharma partnership that was also executed in Q4. And as I said, we signed 10 new deals in the full year of 2023. As you see here on the chart, two were with well-established global Big Pharma players, as well as deals with new biotech partners and academic partners. We added four new deals with start-up partners, and I want to highlight that 40% of our deals were done with start-up companies, despite the significant drop in funding for smaller or new biotech companies in 2023. We see this diversity of new partners as a strength in our business. Maintaining our business track record of execution, we've also seen nice growth and advancement of active programs, and I'm now on slide number eight. As mentioned, we started 2023 with 291 active programs and grew to 325 active programs net of attrition. You can see the growth reflected on the left-hand side in the bar chart. The pie chart on the right breaks down our 325 active programs by stage of development. By the end of 2023, our growing discovery phase consisted of 278 programs and 15 programs that were in the preclinical stage. And importantly, we define preclinical stage programs as ones that are confirmed to be in pre-IND or IND-enabling studies. During 2023, we had six programs move from preclinical to phase one clinical trials. So, at the end of the year, we had 25 programs in Phase 1 trials. And I note also that one program moved from Phase 3 to its first international registration filing. With these leading positive metrics, it's also good to see that we have kept and are building momentum for the growth in active clinical programs that are shown here on slide number nine. We started off 2023 indicating that we expected three to five new clinical starts by our partners. And we ended the year with six new clinical starts. To mention a few just briefly, Seagen announced initiation of a first in human phase 1 clinical trial of its bispecific SGN-BB228, which is targeting anti-CD228 and 4-1BB in advanced melanoma and other solid tumors. This program is now in Pfizer's pipeline following the closure of their acquisition of Seagen and going forward will be referenced by its Pfizer project number. Immunovant initiated a Phase 1 clinical trial of its next generation anti-FcRn IMVT-1402 in autoimmune diseases, and Cessation began a Phase 1 study of CSX-1004, which is a monoclonal antibody derived from OmniRat designed specifically to prevent fentanyl overdose. During the fourth quarter, BioCity Biopharma announced the first patient was dosed with its first-in-class CDH3 targeting antibody-drug conjugate BC3195 in a Phase 1 trial in China. A number of our other partners also reported progress on other clinical and commercial stage assets in Q4, and some of those were summarized in our press release that was issued after the market closed today. Based on our dialogue with partners, we see potential for approximately four to six new entries into clinical development for novel OmniAb derived antibodies in 2024. As I mentioned, we're committed to continued innovation around our platform. And because of the nature of our relationships, we have a great vantage point not only on where the industry is right now, but where the industry is headed. And that informs the technologies that we develop and deploy. Last year, we launched OmniDeep and OmnidAb, and both of those are called out here on slide 10 in the two green boxes on the lower left. I'd like to highlight the OmnidAb technology that was launched in Q4, as it's quickly becoming yet another key differentiating technology here at OmniAb. A foundation of our business is our novel transgenic animals. We believe novel antibodies that are generated in vivo are superior to ones from other sources because they're naturally optimized through an iterative process that preferentially selects for antibodies with excellent specificity and developability profiles. The ability of the immune system of our engineered transgenic animals to create optimized antibodies for human therapeutics is what we call biological intelligence. And we believe this approach increases efficiency and probability of success for our partners and positions our business extremely well. So OmnidAb is our latest example of this. And as described here on slide 11, it's the first and only transgenic chicken producing single domain antibodies, which is a novel class of antibody found naturally in camelids that's being increasingly exploited for a variety of therapeutic applications. OmnidAb is a novel in vivo platform based on a human VH scaffold that affinity matures in a chicken host to provide a functionally diverse immune repertoire of antibodies unavailable from mammalian systems. In a simple sense, single domain antibodies provide modular building blocks that can be assembled into various formats to fit the biology of a desired application. And you can also see on this slide some of the things we hear from our partners about the technology as multiple partners are using it now in active programs. We expect many more will initiate programs with OmnidAb this year and next. This is partly because of the unique physical properties of single domain antibodies that are summarized here on slide number 12. It can be expressed independently as a unit, and their compact format opens up new and important opportunities from a scientific and medical perspective. Single domain antibodies can be leveraged for important applications. They can open up alternate routes of administration that we show here on slide 13. They can lead to increased penetration and tunable clearance and also to new opportunities and new markets for us in imaging, diagnostics, theranostics, and radiotherapy. And they also have broad therapeutic applications in bi- and multi-specifics and CAR-T therapy as well as pursuing therapeutics for CNS and neurodegenerative diseases, which are obviously areas of significant interest for our partners. Now as we look at the current year here on slide 14, in addition to expecting four to six new clinical programs, we expect we'll see late stage advancement for a number of key programs at Genmab, at Immunovant, and others. We also expect that our progress on some of our higher value ion channel programs with global big pharma partners will become more visible to investors and to the research world generally, and we're excited about that. We now have a fully staffed business development team and a more efficient innovation and support engine that we plan to leverage for deal expansion globally. And we'll continue to focus on innovation and expansion of our technology platform and the introduction of new technology, new workflows, and new partner experience enhancements that we'll talk about at scientific and technical conferences throughout the year. And with that, I will turn the call back over to Kurt to run through the financials.
Kurt Gustafson, CFO
Thanks, Matt. So, bear with me one final time as I make the statement about our historical financials. These financial results reported for the periods prior to November 1, 2022, are prepared on a carve-out basis, which were derived from Ligand's historical accounting records as if OmniAb were an independent company. This makes certain comparisons difficult, primarily for operating expenses, given the differences in corporate structure and the methodologies for reporting. So, moving to Slide 16. This summarizes the financial performance in the fourth quarter of 2023. Total revenue for the fourth quarter was $4.8 million compared to $35.3 million in the prior year quarter. The decrease was primarily due to the recognition of the TECVAYLI milestone of $25 million that was recorded in Q4 2022. Service revenue was lower primarily due to the completion of work on certain ion channel programs and royalty revenue was about the same as it was last year. Turning to operating expense. Our R&D expense for the fourth quarter was $14.8 million compared to $12.9 million in the prior year quarter. The increase was primarily due to higher personnel costs and investments in our new facilities. For G&A, expense was $7.9 million compared to $10.2 million in the prior year quarter. Our G&A expense was down due to the transaction costs associated with the spin-off that were recorded in Q4 of 2022. This was somewhat offset by the higher headcount-related costs as we built up the G&A side of the business over the course of 2023. The net loss for the fourth quarter was $14.1 million or $0.14 per share versus a net income of $6.8 million or $0.07 per share in the prior year period. One additional thing that I want to point out is regarding our tax rate in the fourth quarter. We recognized a one-time benefit in the fourth quarter of 2023 that was primarily the result of a deduction for transaction-related expenses associated with the spin-off. Absent one-time items, we generally expect our tax rate to be around 20% going forward. Turning to the full year results on Slide 17. For 2023, total revenue was $34.2 million compared to $59.1 million for 2022. Our license and milestone revenue was lower versus the prior year. The primary difference between the two years was the revenue recognition of the TECVAYLI milestones. We recorded a $25 million milestone for TECVAYLI in 2022 for the commercial launch in the United States versus the $10 million milestone that was recorded in 2023 for the EU launch. Recall, however, that the cash for both milestones was actually received in 2023. Service revenue was down compared to the previous year, primarily due to the completion of work on certain ion channel programs. Operating expense for 2023 was approximately $103.6 million compared to $85.7 million in 2022. We saw an increase in R&D costs associated with higher headcount than the investments in our new facilities in 2023. And for G&A, we saw an increase in costs associated with building out our G&A infrastructure, which included both people as well as normal public company costs that were not part of the expense structure for most of 2022. Net loss in 2023 was $50.6 million or $0.51 per share versus a net loss in 2022 of $22.3 million or $0.26 a share. 2023 was a year of establishing our operations as a separate public company and building a base from which we can grow the business. As you can see, looking at the total operating expense line on Slide 18, operating expenses leveled out at about $26 million per quarter. But keep in mind that a good portion of our operating expense is non-cash. But we now have the personnel and facilities that we believe will be sufficient to support the growth of the operation well into the future. Importantly, we expect to continue to grow the number of partners and programs, but this growth will require minimal additional headcount going forward due to the leverage that is built into our business. As a result, we expect operating expense in 2024 to be approximately the same as it was in 2023. This is a differentiating feature of our business given that our work streams leverage the biological intelligence built into our transgenic animals to discover new molecules. Turning to our balance sheet and cash position, we ended the year with $87 million in cash compared to a starting cash balance of $88.3 million. A significant change on our balance sheet was the reduction in accounts receivable due to the collection of TECVAYLI milestones. To outline our projected cash position moving forward, it's important to understand the factors contributing to our cash burn in 2023. Our actual quarterly cash flows for 2023 indicate that our net cash used for the full year was $1.3 million, supported by a $35 million payment for TECVAYLI milestones received in the first quarter of 2023. Excluding this payment, our pro forma cash burn averaged about $9 million per quarter, totaling $36.3 million for the year. Looking ahead to 2024, we expect our cash use to be similar to 2023, minus the $35 million TECVAYLI milestone payment. However, cash burn will be more front-loaded in 2024, with the first quarter being our largest due to compensation-related expenses. We anticipate that milestone payments will concentrate in the latter half of the year based on the latest updates from our partners. For 2025, we expect our cash use to decline significantly compared to 2024, as we anticipate that our current cash balance and operations will adequately fund our needs for the foreseeable future. Our long-term cash outlook is based on a model predicting cash inflows from existing partner programs, using standard timelines for clinical development along with industry probabilities of success. For instance, we had 25 programs in Phase 1 at the end of 2023, and we expect about half to progress to Phase 2 based on industry standards. We estimate the timeframe for moving from Phase 1 to Phase 2 and calculate projected milestone payments accordingly. While in practice, we won't receive exactly half of a milestone payment, we believe this method reasonably forecasts future revenue. It's worth noting that this cash outlook does not account for any strategic technology acquisitions.
Matthew Foehr, CEO
Thanks again, Kurt. I want to reiterate that in just over a year after completing our spin-off and becoming an independent company, we've made great strides in our business execution. OmniAb is primed for growth, and our business is now highly scalable and highly leverageable given the team we've assembled and the previous investments that we've made into the business. We focus our organizational energy here on our stakeholders, which we see as our team, our partners and the patients that their programs treat or will treat, the communities where we work, and of course, and importantly, our investors. And with that, I will now turn the call back over to the operator to open it up for questions.
Operator, Operator
Thank you. Your first question comes from Puneet Souda from Leerink Partners. Your line is now open.
Puneet Souda, Analyst
Hey guys, thanks for the questions here. So first one, Matt, if I could ask around here in terms of overall expectations, you ended up ahead of that. The number of programs were also ahead just trying to parse out how much of this is simply a function of biotech fundraising and also M&A that we have seen in the first three months this year. And how much of this is due to more business development conversations, could you maybe parse those out? And maybe you're seeing some effect of that already in 2023. So maybe just talk to us about sort of what you saw at the end of 2023? And what's been the conversation on the business development side in the first quarter here as well?
Matthew Foehr, CEO
Thank you for the question, Puneet. Implicit in your inquiry is the recognition that we've experienced a significant decline in biotech funding during 2022 and 2023, making it especially challenging for smaller companies to secure funding, while established big pharma have focused their efforts more narrowly on specific assets or therapeutic areas. Despite these challenges, we experienced substantial growth in active partners and programs in 2022 and 2023, marking some of our strongest growth years in terms of new licenses. It can be difficult to determine the specific factors contributing to this growth. Last year, we were expanding our business development team and had good visibility for our platform, driven by increased investment in innovation, new technologies, and positive developments from our partners in clinical progress. All these factors contribute to the growth we're witnessing. The broader industry appears to have started this year on a positive note compared to 2022 and 2023, positioning our technology favorably due to the validation, visibility, and momentum we are building. I hope this provides you with more insight.
Puneet Souda, Analyst
Yes, that's helpful. And could you talk a little bit about in terms of single domain antibodies, you pointed to a couple of areas where they could be potentially applicable, within the context of your prior product launches, maybe just talk to us how would you stack this, the level of interest you're getting here and your expectations for sort of the growth and then the technology.
Matthew Foehr, CEO
Yes, Puneet, thank you. In terms of the interest in OmnidAb, I can't remember another technology we've introduced or launched that generated as much interest from the very beginning. The moment we launched it, we were already working on antigens for several programs because partners were aware it was coming. We currently have multiple partners utilizing the technology, some of whom have several programs. I believe this technology launch was well-timed for several reasons. At this stage, all of these projects are in the discovery phase. However, the conversations we've had with partners over the last few years have strengthened our belief in the need for a single domain technology like OmnidAb, especially when combined with our screening and other integrated technologies. We are very pleased with the ongoing work, the discussions, and the deliverables already provided to partners who were the first to use the technology at the end of last year. We are also excited about how this positions the business.
Puneet Souda, Analyst
Got it. Okay. Super helpful. I'll hop back in the queue.
Operator, Operator
Your next question comes from the line of Joe Pantginis from H.C. Wainright. Your line is now open.
Joseph Pantginis, Analyst
Hey everyone, good afternoon. I appreciate you taking my questions. Before I ask, I find it quite encouraging to see the efficiencies you’ve implemented and the fact that you don’t need to significantly increase your workforce despite the growth in your programs. That’s really great to hear. My first question is more general. You’re already utilizing advanced technologies for antibody discovery, and while you touched on it briefly in your prepared remarks, I’d like to know how AI has influenced your technologies. This is not just a current trend but increasingly vital for technological advancements.
Matthew Foehr, CEO
Yes. Joe, thanks. This is Matt. And obviously, AI and you've known the business for a while, tracked the business for a while. AI, big data management, deep learning, machine learning, these are all areas that we've been involved in and leaning into for quite a while, really the last few years or more. It comes naturally when you're in the sort of cutting-edge science world that we're in. And it is an area that we've been leaning into much more last year, last May, we launched OmniDeep, which is our suite of in silico AI, machine learning, tools that leverage large multi-species databases. And we launched that in May of last year. But really, many of our partners knew we were in this space long in advance of that. And really what OmniDeep is designed to do is leverage deep learning and really provide the best of our in vivo engineering capabilities and our in silico capability. So we use high-quality input data. We have deep learning models that we presented on at scientific conferences that leverage variational auto encoders to really extend insights that we already get from our screening hits to infer function on other untested areas suggesting new hits and then putting those through in silico developability filters. So we really are using AI and leveraging it here and have been for quite a while. It really does offer our partners a new larger scale discovery workflows with big data, allows us to use optimization tools for existing discovery campaigns and really provides high-quality training data, if you will, for a lot of those capabilities that we've built up over time. So hopefully, that's helpful to you.
Joseph Pantginis, Analyst
No, it certainly does, Matt. I appreciate that color. And I guess my next question or my last question really applies to both the growth and the number of partners that you've been seeing as well as attrition rates. So I guess is there sort of a steady state because you have long-term data, not only from the spin out, but even from the times at Ligand and from the initial start of OmniAb, any steady-state rates that you're sort of seeing with regard to partner growth. Obviously, we have the charts about number of partners growing, but how that links to the visibility of your BD discussions about how many are mature and the attrition rates, does that sort of over time? Or do you see a lot of volatility. And of course, I'm using the analogy from back in the day of Captisol, where it's really changing from quarter-to-quarter.
Matthew Foehr, CEO
Yes, Joe. We always report our numbers after accounting for attrition in active partners, active programs, and active clinical and approved products. We believe this approach provides the clearest view of the business's current status and future direction. Attrition is a normal and expected part of pharmaceutical discovery and development, varying by stage. As we gain more experience with our programs and portfolio, we uncover interesting insights, though it's still early in many respects. For example, while the duration in different phases can vary depending on the program and factors such as the partner's investment profile and whether tasks are done in parallel or sequentially, we see differences in attrition rates from phase to phase. Specifically, our preclinical programs, which are represented by the orange section in our pie charts, face a high threshold for entry. These are programs currently in pre-IND studies, and we have not experienced any attrition in preclinical stages. The timeframe for staying in preclinical can differ; for instance, a program for cancer may progress to clinical trials faster than one for CNS, metabolic issues, or inflammation. Thus, we observe variability in timing across different stages, but the attrition rates differ between discovery, preclinical, and clinical phases.
Joseph Pantginis, Analyst
Got it. Very helpful color. Thank you, Matt.
Operator, Operator
Your next question comes from the line of Stephen Willey from Stifel. Your line is now open.
Stephen Willey, Analyst
Yes. Hopefully, you guys can hear me now. I apologize for that.
Matthew Foehr, CEO
We can hear you, Steve.
Stephen Willey, Analyst
Perfect. During the past year, six programs entered the clinic, and I believe five of those involved downstream participation in royalty agreements. The only exception was the Roche asset, which was a fully paid legacy license. For the active programs currently at various stages of discovery and development, what proportion includes downstream participation in royalty agreements? Also, have you managed to navigate many of those fully paid licensing transactions?
Kurt Gustafson, CFO
Yes. So Steve, this is Kurt. I would reference what we discussed during our Research and Technology Day back in November of last year. Only a few of our programs involve prepaid or grandfathered licenses without associated economics, which we estimated to be 2% of the entire portfolio. That estimate remains accurate as of now. The majority of our programs do have downstream economics. While each program is unique, very few have this prepaid license structure.
Matthew Foehr, CEO
Yes. I'll also mention that the 2% figure, which decreases as we take on new deals, represents agreements we inherited rather than ones we would pursue today.
Stephen Willey, Analyst
Understood. I had forgotten you shared that back in November. Kurt, you're referring to expecting significantly lower cash use in 2025 compared to 2024. You mentioned that briefly in relation to milestones. Are there any other factors you're considering when thinking about the 2025 cash use number? Is there a royalty component involved or an ion channel partnership component? I'm curious to know if it's solely based on milestones.
Kurt Gustafson, CFO
Yes. I believe that's mostly accurate. I've mentioned that in the near-to-medium term, most of our revenue growth is expected to come from milestones. However, as we look further ahead, around 3 to 5 years, we anticipate that royalties will play a larger role in revenue growth. Essentially, we evaluate our partner programs and estimate their timelines. By around 2025, we expect to see more catalysts that could trigger various events. While we can't predict these with certainty, we adopt a probabilistic approach in our analysis. More events mean more opportunities for additional inflows from milestones. So, to address your core question, there isn't much else impacting this; the short term will primarily be influenced by milestone payments.
Stephen Willey, Analyst
Okay, I appreciate it. And maybe just lastly, Matt, you had made a comment, I think, about there being an opportunity for the ion channel and transport of partnerships with Roche and GSK to become more visible to investors, I guess, maybe over the next year or so. Is there anything more that you can just add there with respect to just kind of progress that's being made or, I guess, anything that you can say, I'm sure Roche and GSK are driving the communication part of this, but...
Matthew Foehr, CEO
Yes. We've previously mentioned that we have five ion channel programs actively in discovery with GSK and Roche. The potential milestones for these five programs total over $1 billion. They generally focus on neurodegenerative conditions and other areas critical to ion channels, and we have a strong history in ion channel discovery and screening. All these programs are still in the discovery phase, and I want to emphasize that. However, we are enthusiastic about the ongoing work and the progress we anticipate making on these programs this year.
Operator, Operator
Your next question comes from the line of Matt Hewitt from Craig-Hallum. Your line is now open.
Jack Siedow, Analyst
This is Jack on for Matt. We just have one question. It seems like there's a noted pickup in activity at the end of fiscal 2023. Has that momentum carried through Q1? Or how is the quarter looking so far?
Matthew Foehr, CEO
Yes, Jack, thanks. We'll obviously update on our metrics for Q1 when we report formally. And obviously, we interact with partners every day all the time. And are always working on deals from a business development perspective, but we also get reports from partners at various points during the quarter, off near the end of the quarter. So we'll report those numbers when we report likely in the May timeframe for Q1.
Operator, Operator
Your next question comes from the line of Robyn Karnauskas from Truist. Your line is now open.
Unidentified Analyst, Analyst
Hi, this is Alex standing in for Robyn. The progress has been really great. We're excited to see how the pipeline has matured with more molecules in the clinic at various stages. Will there be any changes to your approach regarding new partnerships and the deals you're considering with potential partners? Let us know if your strategy will shift now that you're in a different stage than before.
Matthew Foehr, CEO
Yes, Alex, we are very focused on our mission to enable the rapid development of innovative drugs for our partners by emphasizing the licensing of drug discovery technologies. We are committed to this plan, which our partners truly appreciate. Currently, we have seen significant growth in the number of partnerships we've established, and the strong relationships we hold with our partners strengthen our determination and focus on technology investments. We feel confident about our mission and the momentum we are gaining with our partners, and we intend to maintain this strategy, as it is the right approach for our business. We frequently receive feedback from partners, including some of our new large pharmaceutical partners added last year, who are drawn to our technology due to our clear focus on technology development and addressing their current and future needs. Overall, we are optimistic about the business we are building and our capability to execute on it.
Unidentified Analyst, Analyst
Sounds great. And another one, if I could. We're really excited to hear about all the interest in the OmnidAb program and then the new scaffolding tech that goes into that. What is the feedback from the partnerships on any other stones left unturned? What type of tech might there investors could see in the future? Is there like another stage that you're working on? Or anything that you can allude to about challenges that still need to be addressed?
Matthew Foehr, CEO
Yes. Look, it's an area that I get very excited about, as everyone here will tell you. And we've got a pretty exciting investment plan in new technologies that's built into our plan. We're becoming more and more efficient in terms of rolling out new technologies. That's largely because of investments that we've made in facilities and workflows and things over recent years. I'll just say, generally, I'm excited about our work around the novel scaffolds area, which is that kind of lower left-hand area of our technology continuum. Also more abilities and work around big data management and things like that, that I think will benefit programs and accelerate programs and also some more scalability initiatives around screening and other things. It gets pretty technical pretty fast, but we'll be talking more about those things at the major antibody discovery conferences through the year like PEGS and AETC. But we're excited about our internal innovation plan.
Unidentified Analyst, Analyst
Yes. That sounds great. And yes, I think we're all excited about the 2024 and beyond. Thanks so much.
Matthew Foehr, CEO
Thank you.
Operator, Operator
Your next question comes from the line of Conor McNamara from RBC Capital Markets. Your line is now open.
Conor McNamara, Analyst
Thank you for answering the questions, I appreciate it. I found the insights you shared about how you adjust the program progression throughout the year very helpful. Reflecting on 2023 compared to a year ago, how does this year's performance compare to your model's expectations? Did financing play any role in the difference between your actual outcomes and your profitability expectations for this year?
Kurt Gustafson, CFO
When considering the short term, we generally do not apply a probabilistic approach for the current year as we set guidance for 2024. Instead, we make decisions based on discussions with our partners about whether they will go forward or not. In the short term, we have more visibility. For instance, if a partner publicly states that they plan to begin a Phase 3 or Phase 2 study in Q3 of this year, we can plan for that occurring. Overall, things have largely gone as anticipated. There were one or two programs that partners had indicated would occur in 2023 that were delayed to the next quarter, but generally, everything has been in line with expectations.
Conor McNamara, Analyst
Okay, thanks. From a competitive standpoint, do you have any insights into how many total programs entering the clinic or in discovery you are winning? Additionally, how has your market share changed over the last several years?
Matthew Foehr, CEO
There isn't a lot of comprehensive data available regarding discovery programs or campaigns. However, it's clear that there is significant potential in antibody-based discovery. This encompasses a variety of exciting developments in new modalities that some might describe as unconventional. We are optimistic about our technology's position in this space, but specific data on market share for discovery campaigns is limited. What I can share is that the opportunity in this area is substantial and expanding. This growth is driven by several well-established factors attracting more sponsors to antibody-based methods, such as improved clinical success rates compared to small molecules and influences from the IRA, which have led to increased investment in antibodies. However, providing an exact market measurement is challenging.
Conor McNamara, Analyst
Thanks. I appreciate it.
Kurt Gustafson, CFO
Thanks, Conor.
Operator, Operator
There are no further questions at this time. Please continue.
Matthew Foehr, CEO
Great. I want to thank everyone for joining our call today. We look forward to keeping you updated on our progress and speaking with you when we give an update for next quarter, we'll obviously be at various conferences that we'll be attending this spring. So we look forward to seeing investors then. In the meantime, we appreciate your interest in OmniAb, and thanks again.
Operator, Operator
Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.