Earnings Call Transcript - QTRX Q4 2020

Operator, Operator

Ladies and gentlemen, thank you for standing by and welcome to the Quanterix Corporation Q4 2020 Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, this conference call is being recorded. I would now like to turn the call over to Amol Chaubal, CFO of Quanterix. Please go ahead, sir.

Amol Chaubal, CFO

Thank you, Charlie. Good afternoon, everyone, and thanks for joining us today. With me on today's call is Kevin Hrusovsky, our Chairman and CEO. Before we begin, I would like to remind you about a few things. Today's call will be recorded and will be available on the Investor Resources section of our website. Today's call will contain forward-looking statements that are based on management's beliefs and assumptions and on information available as of the date of this call. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties, assumptions, and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. The risks and the uncertainties that we face are described in our most recent filings with the Securities and Exchange Commission. During today's conference call, we will discuss some financial measures that are not presented in accordance with U.S Generally Accepted Accounting Principles or non-GAAP financial measures. In the Q4 earnings release and in the appendix of our presentation, which are available on our website, you will find additional disclosures regarding these non-GAAP measures, including reconciliations of these measures to comparative GAAP measures. We believe that these non-GAAP financial measures provide investors with relevant period-to-period comparisons of our operations. These financial measures are not recognized under GAAP and should not be considered in isolation or as a substitute for a measure of financial performance prepared in accordance with GAAP. With that, I would turn the call over to Kevin.

Kevin Hrusovsky, Chairman and CEO

Thank you very much, Amol. And we did do a pre-announcement. So, basically going to go through the strategy charts, the numbers, we will once again go through them through Amol after I go through the higher-level presentation. But I will discuss just the advances we made in Q4 in 2020, with our focus being primarily on COVID, Alzheimer's, in oncology, but most important is the payer disruption in the way we think this is going to transform our overall value creation opportunity. And we'll ensure to continue our dialogue around powering precision health, which is a phrase we coined about six, seven years ago. And it's actually guiding the proteomics evolution that we think can really become a revolution in the way proteins are being deployed. Let me start on Slide 4, where we basically made some pretty significant advances. I think the whole company has probably put out at a pace of about 200% of previous years. And I think the pandemic has reached each and every one of us from an employee level at Quanterix and enabled us to really go after and help the nation as well as the world battle COVID. And it starts with us giving two UAs in the last several months. One for serology, that's a semi-quantitative ability to measure the actual level of antibody, which we think is key with vaccinations, particularly in the durability questions that remain, and also an antigen test that we have also submitted for nasal swab anterior and we've also submitted for saliva. And we expect shortly to submit for dried blood spots, which we think measuring the antigen in blood is a very significant differentiator given the long hauler effect, which many individuals are continuing to be plagued with even months after having had COVID, which we think enables us to measure small trace amounts of the antigen still in many of these long haulers’ blood. And so this will be key for future therapy trials as well as trying to get health back for many of those that have suffered. Even with just lack of taste and smell. We also were granted $20 million by the Radix, a subset of NIH and linked and created phased strategic ties with the FDA that will utilize not only for COVID, but for neurology as we evolve our advances in the neurological diagnostic framework. The payer adoption, we think has been critical. And UnitedHealth Group particularly has been doing a lot of work with us population trials are being run as well as future opportunities, we think to disrupt healthcare by utilizing paired group adoption. And we also believe this, leading as long hauler menu that we've created, and capabilities going to be important to allow researchers to figure out how to prevent many of the longer-term issues that we expect will be linked to COVID. On the right-hand side here, neuro accelerators, the pTau-181, which is a differentiator allows us to stratify out lower bodies dementia, as well as frontal temporal dementia. From cohorts for Alzheimer disease drug trials, this is very important. Also, we've shown evidence of being able to see Alzheimer's disease 16 years through researchers using our biomarkers before the presentation of dementia, and this is key as well, we think for getting an Alzheimer drug across the line with the FDA. We also want to narrow Plex and plan to continue to evolve our neuro plexes that include NFL amyloid betas as well as the peak house. Alzheimer drug trials have never been more important than they are right now, there is even beginning of links to early Alzheimer's from those who had COVID. So we think this is going to be a really important area for our growth not only on the research side, but ultimately longer term on the diagnostic side once a drug is approved. We also had two MS drugs approved this past year. And also, a major study just came out on aging profile measuring our NFL with a lot of quantitation. The higher the NFL level, the older you are in creating that correlation 48% of our fleet now is the HDx and new sales are also tracking about that same pace. And our growth really in neuro has been unprecedented in 2020. Record publications and new biomarkers, as well as 100x sensitivity advanced that we have at a pilot level now when plans are advanced dive into product lines by no later than the end of 2022. The Abbott license put $10 million upfront payments and $25 million of earn outs, associated milestones, as well as royalty payments as Abbott evolves slowly inside of their technology. We did do a raise in 2020 to another one in January. Lab services expansion continues, and you can see our growth on Slide 5 continues at really a double the pace level versus when we were private, our investors are actually doing a lot of introductions to the C suites of our biopharma customers that are trying to get drugs approved using our biomarkers. So it's a real win-win for investors to have both our growth as well as helping get drugs approved at their portfolio companies that are focused on that as being their value creator. Our growth has really gone almost to 55% over the last three years. We did state that we feel very comfortable with 30% to 40% research growth over the period of 2019 to 2023. This is key, I think as you look at our growth projections for this year. An 80% increase in our accelerator revenue we thought was really key last year, given many of our customer labs were down. We also have 180 instruments installed with 93 HDx's; we think this is also very important in the HD landscape, and our consumer growth, recovery in Q4 to a very strong clip. Utilization rates are almost twice what we originally set out for those to be. This slide just gives you the breakdown of the instruments, consumables lab services. And you can see that the growth rate continues to be really strong in Q4 recovery for the consumables which we think is important. But we had a really strong instrument year that I think most are excited to see. We do expect that will continue with strongest growth and consumables, slowest growth in instruments, but we think services will be right in the middle. This is great because the appreciation of gross margin is going to be great with our consumable growth. Slide 7 shows the biomarker growth as well as these publications which validate our technology. That's what differentiates us from many of the others that have tried to revolutionize proteomics is our publications validating by third party peer-reviewed achievement with our technology, and we've democratized it with now 535 instruments around the world. You can see our number of drug trials in red on the right, even inside of our own company. Obviously, we got large CRO relationships with Quest and Labcorp, as well as frontage and others rules based medicine. Even in-house now we're running some really important drug trials and helping rescue many drugs that couldn't get approved without the biomarkers. The overall demographics continue to strengthen you know, we'll call it our Asia position. We do think that 2021 will be a real strong Asia growth year now that we've hired our General Manager, we just did dilution contract. Customers continue to be mostly from biotech, but the academics continue to be an important focus because of publications. While neurology represents for the past 12 months, not the strongest growth, it's a significant portion of our overall installed base. We know that's recovering in Q4 given the labs reopening, our instruments have been continuing to grow at a very strong pace. You can see our accelerated growth this past year. We think this represents a pretty good opportunity for strong growth in 2021, given our 30% to 40% CAGR for the five-year period starting in '19, through '23. On Slide 9, it just goes back through and says we've got very strong validation on the left-hand side where TAM has been $1 billion and we see evolution over the next five years to $20 billion, particularly with a lot of the new entrants that are coming in doing what we call protein discovery, bringing molecules into the pipeline that we then really expand TAMs with our ability to see them with a lot of sensitivity, and see them from home care samples, particularly the less invasive samples. That's key to our evolution. We've gone from basically no revenue to $85 million over the six-year period and put $450 million on the balance sheet. Our valuation continues to evolve. We're really in the first or second inning of what we think is a very strong valuation creation strategy where there's very low regulatory and reimbursement risk. You can see our growth catalyst, and as menu expansion in these drug trials clearly the area that creates significant opportunity for growth, low risk growth, which creates and drives a lot of our future valuation. New entrants are validating the pipeline, creating what we think is a great complimentary relationships upstream. I'm also the Chairman of 908 devices, which is one of those upstream companies giving us great intel across the proteomics pipeline. On the right-hand side, we think the TAMs are 10x and really got a significant opportunity. We've got validation now from the avid deal, the Siemens deal, all the pharma data and NIH and Radix and FDA relationships have never been greater, and we still look for single site LVT. Ultimately IBD in our neuro franchise, starting with MS, but we think Alzheimer's has got a shot on goal over the next couple of years depending on what happens with drug trials. COVID and neural Alzheimer's continue to be our focus, liquid biopsy, we're partnering with companies in that landscape and field to better a low-risk way to manage liquid biopsies. It's a very crowded market and drug companies typically worry about, reducing the size of their markets because response levels in oncology are at very low levels compared to other areas and other disease categories. We think from a payer standpoint this leapfrog where we've struck these relationships is really capitalizing the opportunity for value creation on both the left and the right, but particularly the right. As I look for trying to reinvent the diagnostics industry, basically looking for disease before symptoms when it's much more therapeutically beneficial to intervene with the patient, ultimately preventing these diseases by having very early detection is a chance to really create a very different kind of outcome with biomarkers. Our overall strategy hasn't changed current detection level shown in red, on Slide 10. And the second part of Slide 10 shows how we are moving them into the asymptomatic region. What's less invasive, testing in the areas of cancer neuro and COVID. Protein we think is vitally important. It's more phenotypic given great utility. It's been attempted for really 50 years. And we know that there are some pretty big players already measuring proteins. The proteomic landscape is still very under discovered. We think identical twin study is really about the proteins, what's different when one twin grows up to get cancer when the other one grows up to get diabetes, even though they have the same DNA and RNA. Slide 12 shows there's 200 proteins that Abbott, Siemens, and Roche are measuring today creating $20 billion of revenue. On the left side in research, you can see lumen x and protein sample and some others are playing very successfully in the 1300 protein regime. When you bring sensitivity on, you can see we significantly expand the landscape and also provide the less invasive opportunity for measuring these biomarkers. We ultimately think there could be 1000 proteins measured versus today's 20 proteins. And this is five times the current level. Five times $20 billion brings $100 billion to TAM just in the diagnostic side alone. The computer industry and this whole revolution of technology has evolved the genomic landscape of sequencing. We believe the proteomics is now ready to be revolutionized. Slide 14 shows that ultimate opportunity that alumina was able to create, and they spun Grail out and then brought Grail back in. A lot of the current value in this overall genomic landscape is downstream. We know that Grail move was a smart move by Illumina. We think that there are many lessons here. We have the same founder of alumina that founded Quanterix. We're trying to learn from those lessons to try to get some value downstream and make sure that we don't lose a lot of that downstream value. We're using greater sensitivity to enable the lesson base of biomarker subtypes and multiplexing for disease specificity and single molecule detection. That does create this new paradigm of measuring proteins and home care samples to see disease before symptoms. This is going to be an awesome technology for disease progression monitoring across all areas. But we're prioritizing ourselves for neurology first where we don't think the landscape is crowded. Tremendous focus right now particularly on Alzheimer's. Our pipeline on Slide 16 shows the drug trials. We're primarily focused today on the brain and COVID. But we're evolving into oncology and heart and on the right, you can see that the TAM grows to $30 billion by just moving into COVID, Alzheimer's, MS, and TBI. We are trying to create a direct presence. We also have relationships signed with Siemens and Abbott as partners that we think can further validate our opportunity. Roche is one of our largest customers. You can see many companies hoping to add Nautilus and OSI and others that GSI that have further evolved through specs and continue to invest on the left-hand side, we think it's getting very crowded, but that only brings more proteins into the pipeline for us to expand TAMs with this sensitivity. What we did is build a TAM narrative that starts today, pre-COVID, at about $24 billion in neurology and oncology and research. Once we go post-COVID it cuts across with EUA. It creates a $12 billion TAM, but mostly what we're doing is a strategic Trojan horse strategy of moving into diagnostics with neuro and then going back upstream into research for COVID. We now have the validation for the EUA and the long hauler ability to see the virus in blood; we think we really can start to evolve the research side of COVID. This next phase of disruption with the pair groups really allows us to evolve downstream then it's an immunology and oncology further building out the TAM, then ultimately we do think further bringing sensitivity upstream into the discovery side. We think two, three years from now, you'll be able to get many of these answers on protein pathology with less invasive samples. So we know discovery will actually benefit from the lesson base of samples. We don't feel like that's the priority; we think it's a longer-term piece of our TAM story. When we lock and load right into Slide 18, biomarker discovery leads to biomarker adoption by those companies that will show with a 200% increase in probability of a drug being approved when they use our technology. That's why we focus on neurology where these drugs like Alzheimer's disease have never been approved. It's key to get them across the goal line. You can see those six markers right now are very important as our story continues to evolve with Lilly and with Biogen and Blackstone and Pfizer, as well as Takeda and Novartis and Roche. Getting to the actual help screens, bringing many of these patients into the cohort and or once the drugs approved, getting therapies into patients before the presentation of symptoms really transforms this landscape and leads to new biomarkers being discovered. Slide 19 shows all the biomarkers; it used to be down to a $5,000 CSF spinal tap. Very painful, very expensive. It's very hard to get patients in drug trials even for a spinal tap or a $5,000 PET image. A lot of today's world is on the left. What we're doing is a cross informing and standing up tests across all these different diseases and research using blood, and initially venous trials. Ultimately, we think the ability to get dry blood spots is really important to demonstrate home testing for many of these different technologies. That's where the sensitivity further enhances that ability. Slide 22 shows those two drugs that were approved in 2020 key here, and that drugs approved secondary and primary endpoints using NFL. Neurofilament light where we've locked down required know, a year and a half ago has been key because they got 100% of the publications, over 200 of them now are using antibiotic pairs exclusively with simola. We feel very importantly locked up to support our customers' research in these areas. We're really excited about Slide 21 where we could see Alzheimer's and a chance for doing that scene early, we thought it was more of a research play to allow cohorts to be recruited, but primarily Lilly and Biogen right now very close to driving through with the FDA towards approvals. In the center here, the advanced we may with pTau-181, 217. This new neurological publication coming out of Europe from neurologists allows us to create correlations with amyloid disease and pathology using our pTau-181, 217. This is key to allowing a simple blood test to be able to reveal not only Alzheimer's early and stratify it out, but could someday become a key for diagnostics. On Slide 20, you can see all the drug companies that are deploying technology. We think this is a big piece of our story. They are referenced selling at conferences and summits like the Pyrant Precision Health Summit, allowing other customers to see the usage of the technology across all disease categories. While we expect growth, no matter if an Alzheimer drug is approved this year or not, because the need for our technology continues. Once approved, that creates the diagnostic opportunity. That's where we're looking at first, single site LDP initially and then evolving into single site IBD. In the area of COVID, this has really allowed the world to see just what possible sensitivity is. The Corona virus is most contagious before symptoms unlike any other virus, making it very difficult to control because of the immune system's response to the antigen. This next slide shows that when you can see the entire range, it allows you to broaden detection window. We believe our technology ultimately will be very valuable for asymptomatic COVID testing, which is key for screening students and workers to get them back to work and across all categories. We even have technology for the NFL and loss of taste and smell. We can measure it through publications now supporting this from neurologists. Key linkage to early Alzheimer's will help not only with Alzheimer approvals, but also with long-haul COVID itself. Looking at the entire kinetic spectrum of COVID is key for long hauler assessments. The NIH is running a 10-arm trial using our technology with therapies like the antibodies from Lilly and Glaxo, as well as remdesivir from Gilead; these are important to see the blood and see the virus in blood for those trials. Slide 26 shows a full menu of different types of biomarkers that allow us to assess the symptoms of COVID to see if in fact, the technologies and the therapies being deployed will eradicate the virus and associated symptoms. We know many follow-on cardiac issues, respiratory issues, stroke, as well as brain fog may lead to neuro-degeneration. Quanterix is technology-driven. Many are market-driven and use a process. We've been associated with hiring precision health for some time. This allows us to see where the industry is going regarding many of the critical diseases that are most lethal, like cancer, brain neurodegeneration, and COVID. Slide 28 shows how this PPH ecosystem brings innovation very quickly to patients. Those constituencies down below represent the most senior levels from all those areas, whether it be investors, scientists, hospital groups, advocacy groups, and various research groups, all attending. We can interconnect with Leroy Hood's group, Michael Milken, and many of the top thought leader groups to advance our thinking. Slide 32 shows some key C suite relationships that uniquely bring precision health collaborations into connectivity with each other, catalyzing the proteomic revolution by connecting these dots.

Amol Chaubal, CFO

Thanks, Kevin. I'm going to provide some additional financial details about our Q4 and full year 2020 performance. We'll be referring to Slide 34 our webcast page 55. As Kevin noted, GAAP revenue in Q4 of 2020 was $26.1 million and included $4.5 million of revenue from RADx Awards. Excluding these non-recurring items, our non-GAAP Q4 2020 revenue was $21.6 million, a 36% increase versus prior year Q4. Consumables revenue increased by 49% in Q4, and instrument revenue increased by 21%. Service revenues increased 28% in Q4, driven by a 46% increase in accelerator services revenue. GAAP revenue for the full year 2020 was $86.4 million and included $11.2 million in revenue in connection with a nonexclusive license agreement with Abbott in Q3, and $6.4 million in revenue from our RADx Awards across Q3 and Q4. Excluding these non-recurring items, our non-GAAP Full Year 2020 revenue was $68.8 million, a 21% increase versus prior year, despite challenges in accessing customer sites for installations and interruptions in customer operations due to COVID-19. As previously discussed, we've proactively expanded our accelerator services capacity to support our customers' research and clinical trials. This resulted in a 50% increase in our service revenue driven by an 80% increase in courier accelerator services revenue. Coming to RADx; we are accounting for our RADx Awards under IS 20 accounting for government grants and disclosure of government assistance. Under IS 20, we expect that approximately half of the total RADx work package to milestone payments of approximately $9 million will be recognized as grant revenue, of which approximately half was recognized as grant revenue in 2020. We expect the remaining approximately $4 million to $5 million will be recognized as grant revenue in 2021. The remaining approximately $9 million of contract milestone payments that relate to reimbursement for the purchase of property and equipment will be recorded as a reduction in the carrying value of these assets and will have no grant revenue associated with them in a profit and loss statement. We are not providing revenue guidance. Recent customer activity has returned to pre-COVID levels. However, a potential spread of new coronavirus strain may force new lockdowns resulting in challenges, such as limitations in accessing customer sites or dropping consumables utilization due to interruptions in certain customer laboratories in the US and Europe. On a non-GAAP basis, Q4 gross margin was 50.8% versus prior-year Q4 gross margin of 47.3%, an increase of approximately 350 basis points. Our non-GAAP gross margin excludes the impact of our RADx awards as well as non-cash acquisition related purchase accounting adjustments from our 2019 acquisition of Oman, thus providing investors with relevant period-to-period comparison of our operations. We believe we have a significant opportunity for gross margin expansion as we evolve our mix towards high-margin consumables and services, scale our overall business, and reduce product costs. Our Q4 GAAP operating expenses totaled $25 million. Non-GAAP operating expenses, which primarily exclude non-recurring expenses associated with our RADx grant revenue total $22.6 million. During Q4 2020, our cash balance increased by $8.4 million, driven by $10 million milestone payments received in Q4 from Abbott, timing of RADx payments, and proactive working capital measures. We close the year with $181.6 million unrestricted cash balance. During Q1 2021, we raised approximately $270 million in net proceeds through our public offering. Basic weighted average shares outstanding for EPS totaled $31.7 million for Q4 2020 period. Overall, we are pleased with our Q4 and full year 2020 performance and progress made on our strategic priorities and remain committed to delivering a solid 2021 result in line with expectations. With that I will pass back to Kevin.

Kevin Hrusovsky, Chairman and CEO

Thank you, Amol. We will open up for Q&A.

Operator, Operator

Your first question comes from the line of Puneet Souda with SVB Leerink. Your line is now open.

Puneet Souda, Analyst

Yes. Hi, Kevin. Thanks for taking the questions. The first one is on proteomics. I mean, obviously, there's significant interest here in proteomics and more investment is flowing into early-stage technologies. Obviously, proteins, and more importantly, the detection of proteins and in the most sensitive ways, is something you do very well with Synovia. I’m just trying to understand how is Quanterix positioned in the continuum of the overall research from, you know, the early-stage sort of screening research, where you're looking at large panels and large number of proteins to more targeted side of things, and then into the diagnostics? Where do you sit into that continuum, and what should we be looking out for as signpost for Quanterix to be positioned even more in proteomics?

Kevin Hrusovsky, Chairman and CEO

Very good question, Puneet and it's interesting, I get more questions in all of our one-on-ones with investors about where they should be making their investments upstream, given all of these new entrants, than I do sometimes even about us, because I think there's a lot of confidence and belief; they understand that we are executed and have been doing this for really 20 years with a lot of execution prowess. We’ve spent a lot of time studying this landscape before even entering it. I came out of retirement seven years ago, but most of the 100 people we have in the company now are from some of the former companies, and are very experienced at driving execution in this landscape. We’ve been very measured in how we’ve approached it. What we've been finding is that there’s a lot of misinformation around those, there are a lot of people that can say things like, you know, we can see these markers. What we find out is that when they can see these markers, these would be some of the upstream companies, they're seeing them in very invasive samples and or, they're basically saying that they can see them, but the challenge is being able to see them through the continuum of health to disease. When you're healthy, you're at the lowest level; the lowest level of concentration of these proteins. What really is the magic around where we sit, which is downstream of much of the discovery, where the mass spec and many of these new entrants are trying to play a role in discovery. Some of them call themselves unbiased. I think to a great extent, many of them are unbiased, but they're not really, totally unbiased because if a biomarker or a protein is at a really low concentration in a less invasive sample, and the patient is healthy, as an example, what you'll find is that their technology won't be able to see it in that condition, which makes it actually biased against sensitivity. One of the big areas that I think is important for everyone to understand is, we are not trying right now to be a discovery house; there are a lot of really good companies entering the field that we think will be really good at discovery in invasive samples. But we really bring our value when you start to say what you can see in CSF, let's now see it in blood or see it in saliva, or even see it in breath condensate. That’s when we think the utility of that protein goes way up. You can see it in a non-invasive sample, and then if you can also see it from health to disease, even in the youngest population, where once again, the younger you are, many times the protein levels for like an NFL are even lower. It’s that complete continuum that brings greatness into the discovery opportunities. Most of our customers understand that ultimately, they’ll want to have that sensitivity to allow them to see that very low abundance in that lesson base of sample. Many times cleaning up the sample with dilution and getting around false negatives and false positives, is another use of the sensitivity and ability to quantitate. This is key for COVID when there was a real question around getting antibodies, well, what's the quantitative level of those antibodies, and ultimately is it neutralizing the actual virus which seems to vary significantly? We’re learning from the NIH about the variations between people, even within the same person for different weeks that they have the virus. There’s so much diversity that you just need to be able to quantitate what you’re seeing in order to unravel this mystery of COVID. This is where I think we play fairly uniquely, with a lot of the drug trials and getting those drugs approved. Ultimately, this opens up the opportunity to screen people into the drugs to get approved, and that's really where we sit. Right now, we sit fairly uniquely there, and I think this is going to be a really important time for our growth.

Puneet Souda, Analyst

That's great. That's very helpful. Kevin, I want to touch briefly on the neurology trials. You have done well here throughout 2020. We saw a major uptick in trials for Alzheimer’s and multiple sclerosis and Parkinson's and other neurology indication trials that have ramped up. Any measure you can provide us in terms of, you know, the number of trials that you can potentially get involved in as a result of more data and more confidence on Alzheimer's and, and just broadly in terms of Neurology trials, what's your level of confidence, for further growth in 2021, given the base we saw in 2020, which was still a bit of a pandemic impacted year?

Kevin Hrusovsky, Chairman and CEO

We feel very confident about 2021 and 2022 relative to the neurological drug trials and the current level of our very embryonic penetration, which is actually embryonic in a field that needed to start in because in order to conform to the FDA guidelines for biomarkers to be used in a drug trial, you have to have approved drugs to validate and quantitate the clinical validity of that biomarker for showing drug efficacy. MS has 16 approved drugs that allowed companies like Novartis and Roche to look at previously approved drugs to validate and retrospective trials, biomarkers like the NFL, and then deploy them basically downstream for prospective trials for new drugs. This is why MS really is where it started. Even there, we feel like we're only 10% penetrated. That said, we see a lot more phase three trials and phase two trials because we’ve been at that for several years. Alzheimer's is an area where there's no approved drugs, and so it's been harder for the Alzheimer companies to prove out these biomarkers, many times proving them out with existing technologies, such as imaging, and like cerebral spinal fluid, spinal tap samples. These are so invasive and expensive that they don't translate into longer-term utility. That's where we enter to ultimately see this in a blood sample and then someday in saliva samples. We are unearthing the utility of those biomarkers for longer-term diagnostic and health screening purposes as opposed to just getting the drug approved. So many of the Alzheimer trials to date have not utilized our technology, for those trials. Like if you look at the Biogen data, it's really based on CSF, highly concentrated samples. We know that long-term, one of our largest customers is Lilly; we see also a lot of potential opportunities for the lesson base of samples to get recruitment for patients to run these trials. We’re bridging up and teaming up now with some of the payer groups to enable leading-edge drug trials using what we consider to be the payer groups' membership as a great place for the biomarkers to deploy that allows the payer group to showcase their leading-edge capability that almost anyone will want to be part of a peer group, because of what they will bring as the next generation of medicine to deploy pre-symptoms or asymptomatically. So I do think that we are at the first stage for Alzheimer’s and see tremendous upside for the next several years utilizing our biomarker technology for those trials. We see for two reasons: early recruitment before presentation of dementia when it's easier for a drug to be efficacious, and secondly, enrich the cohort by removing bodies dementia and removing frontal temporal dementia, using the stratification capability of the technology. Once the drug gets approved, then we look downstream to triage and help screen to move patients more efficiently than imaging and or spinal taps into the drug.

Puneet Souda, Analyst

Okay, thanks for those details. If I could ask a more near-term question. First of all, that's great to hear your thoughts on the longer term, as you're seeing these trials ramp up. But I think you pointed out 30% to 40% research CAGR here in 2019 to 2023, I believe. But you have a number of growth drivers. You have easy comparables for 2020, as well. So just tell us why shouldn't we expect meaningfully higher growth in 2021, versus that CAGR that you pointed out?

Kevin Hrusovsky, Chairman and CEO

Well, first of all, I've warned you Puneet, and I tried to say this to all the analysts, I think 30% to 40% CAGR is plenty to create a lot of value and trying to model things that go beyond that represents risk that's not justified for our investors. I would actually criticize anyone that starts to throw CAGR, much higher than that. We feel very comfortable that that's a CAGR we can manage and execute against. The value creation of our company is in the narrative of what we are really evolving on diagnostics. You're conceiving the beginnings of many new investors and we did a raise back a few weeks ago; we had a billion dollars of demand in a 24-hour period because of the larger interest from new investors into this category due to the longer-term opportunity. In the short term, I agree that we have some good comps because 2020 was something we had headwinds more than tailwinds for COVID. When looking at the CAGR or the growth rate in 2021 versus 2020, it’s probably going to be greater than the CAGR, because our growth in 2020 was less than the CAGR because it was headwinds from COVID. Again, I wouldn’t buy our stock based on that; I think that’s trying to time it in the short term. As for COVID, we don't want people to see the tailwinds of what we're doing diagnostics for COVID; we want to make that a non-GAAP measure. We want to prevent hard comparisons for 2022. We don't want our stock's drive to be based on what is more of a tail, short-lived effect. It's going to give us a pathway to get into these research institutions with the EUA for screening students. It will also allow those installations to feel safer for the long hauler effective COVID, which is a five-year play. This is where we see sustainability in COVID value for our investor base.

Operator, Operator

Your next question comes from the line of Sung Ji Nam with BTIG. Your line is now open.

Sung Ji Nam, Analyst

Hi, thanks for taking the questions. Kevin, thank you so much for all the color around how Quanterix fits into the overall proteomics landscape. I was curious about your multiplexing capabilities. You’ve obviously made a lot of progress in terms of sensitivity, attaining greater sensitivity, but haven't talked about multiplexing capabilities. While in my view, I’m kind of curious as you think about how Quanterix fits into the downstream area, compared to some of these early discovery players, is multiplexing not as critical in your view and what is the right multiplexing capability, I guess, that we should think about going forward?

Kevin Hrusovsky, Chairman and CEO

Perfect questions, Sung Ji, and I’m developing a slide for future presentations, as this is really interesting in the recent search phase of things, particularly in discovery where you're trying to identify a linkage between pathology of the disease and protein signatures, you really want to have a very broad multiplex capability. Mass spec has been an example of this, where it's a very broad-based shotgun, looking at many different proteins. I see evidence of these new entrants, like Shear, and symbolizes is not a new entrant, but they're very capable. I look at old link knowledge; there are a lot of companies that will bring value to the multiplex shotgun to identify the rich pathology for evolving the utility of the biomarker into drug trials and then ultimately to diagnostics. That’s where you want the lesson base of sample, be able to quantitate, to dilute samples. This is when the sensitivity becomes really important. Someday, I’m going to have a slide to show the multiplex role for the different stages of the pipeline: what you see as to the upstream side where you’re doing discovery, wanting to have a lot of Plex, but the overall TAM and value creation probably won’t be as significant until you get it down the pipeline, used for drug trials, and ultimately used in diagnostics. That’s where we believe the TAMs get much bigger and the value gets created. There are three companies, Roche, Siemens, and Abbott, nearly $20 billion, of TAM on basically 200 proteins, but 100% of that revenue is basically single Plex. You can see what I mean, you need a lot of multiplexing upfront. But once you get into the utility zone, 10 Plex to maybe 20 Plex is probably more than it's needed for a panel that gives you the specificity for disease specificity. We think the volume of testing will be greatest for the high Plex. The value, where many dollars sit, will be in single Plex and lower. Roche, Abbott, Siemens have demonstrated that with their incredible ability to create a lot of value for very few proteins.

Sung Ji Nam, Analyst

Yes, that’s super helpful. Thank you so much for that. It’s fantastic to hear you guys are partnering with the payer groups. Just curious, are there specific studies that are currently underway where you might have visibility into the timeline of when we might be able to see the data readout?

Kevin Hrusovsky, Chairman and CEO

Yes, I think you'll see it is up to the payer themselves on what they want to publish. I can't really say at this moment how public they will be with the surveillance data they’re collecting. We're running three different IRB studies right now and see a lot of opportunities for additional ones to inform them at more of a population level. We think that it’s important to get them introduced to what biomarkers can do. This can lead to a future where we’ll offer biomarker surveillance to their members, likely at a quarterly level, hopefully using home care. How much they'll publish between now and when they get to that state is kind of their call, and we will be inviting them to continue attending the independent conference summit called powering precision health, because it aligns with what they're trying to do with outcomes. isso It makes it very easy for their involvement there, and that's probably where you'll see a lot of the study readouts.

Sung Ji Nam, Analyst

Great, that's super helpful. Lastly, for me, just curious on the COVID antigen test. Obviously, very interesting insight into the disease there and it sounds like you guys are using it largely for research applications currently. But do you foresee the whole field of infectious diseases where you have capabilities to detect antigen, viral antigens at high sensitivity could potentially disrupt the clinical diagnostics field when it comes to detecting viruses and pathogens going forward?

Kevin Hrusovsky, Chairman and CEO

I do think there are some potential differentiating opportunities in that field of diagnostics for COVID. We are treating it more as a measure of revenue we would probably subtract it out because we don't know how long-lived it would be given the vaccines and timing of the overall COVID. We do think it’s easy to mislead investors in this part of the landscape, so we do expect there to be some tailwinds. One area would be in just looking at anyone called long haulers, people still suffering from symptoms; many of them even six months later still don’t have recovery of taste and smell. This is a key CNS function that could be linked to sometimes longer-term neurodegeneration. We think there is also evidence of stroke and heart attack from those having COVID. The innate immune system being fatigued is another focus for a lot of research. There is an opportunity for diagnostics that look at the virus in blood to ensure these patients have eradicated all of the virus from their body. They may measure using traditional nasal pharyngeal or nasal swabs, which may find the virus left the respiratory tract but is still lingering in the systemic blood, vascular tracking. I think there will be diagnostic options. The whole field of asymptomatic, if we can get the right samples in the right IRB run, we think we could play a role there to see the virus before symptoms hit, when it’s more important to manage because that's when you're contagious the 24-hour period before symptoms show. I think those two areas represent potential chances for tailwinds in '21. But again, we don’t want people to buy us based on these tailwinds. It is more an entry for us to research institutions looking to see the long haul effect. Unfortunately, we have to cut off if there are more questions. I got to give a keynote and another meeting here at 5:30. If there are other questions, feel free to write those to us. Thank you for all the continued support from our investors over the last 3.5 years. This opportunity to keep updating you is appreciated. Let us know if any of you would like us to reach out to you one-on-one. Thank you very much for your time today.

Operator, Operator

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.