Name: 2seventy bio, Inc. Q2 2024 Earnings Call
Start: 2024-08-07T12:01:00.000Z

Executive Summary

Q2 marked operational and financial inflection: Abecma U.S. revenue rose to $54.0M from $52.0M in Q1, apheresis activity grew double‑digit, GAAP net income hit $24.9M on a $48.0M one‑time gain from the Novo Nordisk asset sale, and operating expenses fell ~43% QoQ .
Total revenues were $8.97M (down 75% YoY) with collaborative revenue of $4.35M; diluted EPS was $0.45 vs $(0.83) YoY and $(1.01) in Q1, driven by divestiture gains rather than recurring operations .
Management cut FY24 net cash spend guidance to $40–60M (from $80–100M) and reiterated cash runway beyond 2027; path to breakeven by 2025 remains tied to third‑line Abecma uptake and cost discipline .
Near‑term stock catalysts: evidence of pull‑through from Q2 apheresis into Q3 revenues; continued third‑line launch execution and collaboration revenue progression; sustained OpEx declines .

What Went Well and What Went Wrong

Earlier‑line approval unlocked a larger market; Q2 U.S. Abecma revenue climbed to $54M with “meaningful growth” in apheresis, indicating demand momentum into Q3 .
Aggressive cost actions: operating expenses reduced ~~43% QoQ (~~$28M), and management lowered FY24 net cash spend guidance to $40–60M, extending runway beyond 2027 .
Management tone confident: “We enter the second half in a strong financial and operational position, poised for commercial growth,” and “ABECMA performance in the U.S. turned a corner” .

Total revenue fell to $8.97M (−75% YoY) as collaborative revenues declined and royalty/other revenue went to zero; YoY comparisons reflect lapping larger prior‑year collaboration revenues .
Profitability was one‑time: GAAP net income of $24.9M was driven by a $47.99M gain on the Novo asset sale; underlying operations still rely on Abecma growth and cost discipline .
No revenue guidance yet; management intends to wait for several quarters of launch data before providing Abecma guidance, leaving external models dependent on qualitative indicators .

Metric	Q2 2023	Q1 2024	Q2 2024
Total Revenues ($USD Millions)	$36.05	$12.44	$8.97
GAAP Net Income ($USD Millions)	$(42.09)	$(52.67)	$24.88
Diluted EPS ($USD)	$(0.83)	$(1.01)	$0.45
Total Operating Expenses ($USD Millions)	$84.04	$63.59	$36.04
Abecma U.S. Revenue (BMS reported, $USD Millions)	—	$52.0	$54.0
Collaborative Arrangement Revenue ($USD Millions)	$29.03	$4.71	$4.35
Cash, Cash Equivalents & Marketable Securities ($USD Millions)	—	$181.38 (3/31/24)	$201.87 (6/30/24)

Revenue Line ($USD Thousands)	Q2 2023	Q2 2024
Service Revenue	$5,022	$4,621
Collaborative Arrangement Revenue	$29,034	$4,346
Royalty and Other Revenue	$1,992	$0
Total Revenues	$36,048	$8,967

KPI	Q4 2023	Q1 2024	Q2 2024
Abecma U.S. Revenue (BMS) ($USD Millions)	$56.0	$52.0	$54.0
Collaboration Revenue ($USD Millions)	$2.0	$4.71	$4.35
Net Cash Spend Guidance (FY) ($USD Millions)	—	$80–100	$40–60
Cash & Equivalents ($USD Millions)	$221.81 (12/31/23)	$181.38 (3/31/24)	$201.87 (6/30/24)

Metric	Period	Previous Guidance	Current Guidance	Change
Net Cash Spend	FY 2024	$80–100M	$40–60M	Lowered
Cash Runway	Multiyear	Beyond 2027 (reiterated)	Beyond 2027 (reiterated)	Maintained
Abecma Revenue Guidance	FY 2024	None provided	None provided	Maintained
Operating Expenses Trajectory	FY 2024–2025	Down materially vs 2023	Continued decline into 2025	Reaffirmed downtrend

Topic	Previous Mentions (Q4 2023 and Q1 2024)	Current Period (Q2 2024)	Trend
Third‑line approval & launch	ODAC and sBLA path; confident on approval; launch will expand TAM	Third‑line launch underway; signs of “green shoots” and double‑digit apheresis growth	Improving momentum
Safety differentiation vs competitors	Real‑world data suggest fewer delayed neurotox events vs peers	Physicians cite safety (e.g., Parkinsonism concerns with others) as a driver favoring Abecma	Favorable differentiation
Bridging therapy emphasis	Bridging can improve outcomes; discussion at ODAC	Strong messaging that optimized bridging improves PFS (20.7‑mo mPFS in bridged subgroup)	Increasing focus
Manufacturing capacity & sLVV	Approved for suspension LVV; faster turnaround; >90% in‑spec	Reliability reiterated; rapid turnaround with high in‑spec rates	Steady strength
Cost structure & cash runway	Strategic realignment; $150–200M savings across 2024–2025; runway >2027	OpEx down 43% QoQ; FY24 net cash spend cut to $40–60M; runway >2027	Strengthening
Guidance posture	No Abecma revenue guidance until more data	Still no guidance; expect updates after several quarters	Unchanged

CEO: “We enter the second half in a strong financial and operational position, poised for commercial growth… We were pleased to see that Abecma turned a corner in the second quarter” .
CFO: “We achieved a $28 million or 43% reduction in GAAP operating expenses versus the first quarter… revised net cash spend range of $40–$60 million in 2024” .
CMO: “KarMMa‑3 showed significant superiority… We are clearly messaging on the consistent PFS benefit… efficacy further enhanced with optimized bridging therapy” .
CFO on breakeven: “Total U.S. sales of less than $400 million makes us breakeven as a total company” .

Demand indicators: Double‑digit growth in apheresis and sites returning to prescribing Abecma; expected pull‑through into Q3 revenue .
Differentiation strategy: Emphasis on KarMMa‑3 efficacy, reproducible real‑world outcomes, manageable safety, and reliable manufacturing .
Profitability path: Breakeven achievable at < $400M U.S. sales given lower OpEx; capacity and suspension vector support cost efficiency .
Guidance stance: No Abecma revenue guidance for now; focus remains on third‑line launch execution .

We attempted to retrieve S&P Global consensus estimates for EPS and revenue; data were unavailable due to missing CIQ mapping for TSVT. As a result, we cannot quantify beat/miss vs consensus for Q2 2024. We will update when S&P Global mapping is available [SpgiEstimatesError from tool].

Third‑line launch is progressing: apheresis growth and modest Abecma sales increase point to Q3 revenue acceleration; watch for collaboration revenue inflection as pull‑through manifests .
Cost discipline is durable: OpEx down ~43% QoQ; FY24 net cash spend cut to $40–60M extends runway >2027, de‑risking near‑term financing needs .
Profitability in Q2 was non‑recurring: GAAP net income driven by $48M Novo gain; sustainable profitability hinges on Abecma volume growth and margin leverage from manufacturing utilization .
Safety narrative is constructive: physicians’ concerns about delayed neurotoxicity in competitors may favor Abecma; management is actively detailing differentiated safety and efficacy .
Execution focus: no revenue guidance yet, but management reiterated breakeven potential with < $400M U.S. Abecma sales and continued OpEx reductions into 2025 .
Tactical trading lens: Q3 reported numbers (BMS and TSVT collaboration line) are the near‑term catalyst; signs of revenue acceleration should support sentiment if third‑line uptake continues .
Strategic: Earlier‑line approval expands TAM; sustained site expansion, optimized bridging, and reliable manufacturing are key to out‑executing competitors in a growing but competitive market .