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2seventy bio, Inc. (TSVT)·Q3 2024 Earnings Summary

Executive Summary

  • Abecma U.S. revenue was $77.0M, up 42% sequentially from $54.0M in Q2, reflecting earlier-line uptake and improved site capacity; total company revenue was $13.5M (+13% YoY), and GAAP net loss narrowed to $9.9M from $71.6M YoY .
  • Management guided FY 2024 Abecma U.S. revenue to $240–$250M and reiterated 2024 net cash spend of $40–$60M; cash and marketable securities were ~$192.4M with runway beyond 2027 .
  • CFO cited improving ABECMA margins driven by demand and manufacturing success “north of 95%”; breakeven sales threshold for the company moved “closer to $300M” from prior ~$400M, enhancing medium-term optionality .
  • Strategic realignment continues: discontinuation of KarMMa-9 enrollment conserves >$80M over several years; operating expenses fell 24% QoQ and ~52% YTD, supporting path to breakeven as early as 2025 .

What Went Well and What Went Wrong

What Went Well

  • Sequential Abecma sales growth: “42% sequential growth” to $77M, driven by third-line launch, capacity, and site activation; CEO: “strong growth in ABECMA sales… one step closer to breakeven” .
  • Margin drivers and manufacturing: CFO highlighted “manufacturing improvements… success rate north of 95%,” improving profit share margins on higher volume through a high fixed-cost base .
  • Cost discipline and cash runway: OpEx down 24% QoQ; cash of ~$192.4M with runway “beyond 2027,” and KarMMa-9 enrollment stoppage saves >$80M over several years .

What Went Wrong

  • Seasonality and competitive dynamics: Management flagged holiday-driven scheduling reductions and ongoing competition impacting Q4 cadence despite full-year guidance intact .
  • Early deaths and safety narrative scrutiny: Company materials reiterated boxed warnings and highlighted KarMMa-3 early death imbalance (18% vs 11%) and the need for optimized bridging therapy to mitigate risk perception .
  • Consensus benchmarking unavailable: S&P Global consensus mapping for TSVT was unavailable in our system, limiting direct beat/miss quantification versus Street estimates for Q3 (see Estimates Context).

Financial Results

P&L Selected Metrics (Quarterly)

MetricQ1 2024Q2 2024Q3 2024
Total Revenues ($USD Millions)$12.435 $8.967 $13.534
Loss from Operations ($USD Millions)$(51.154) $(27.069) $(13.941)
Net Income (Loss) ($USD Millions)$(52.673) $24.879 $(9.933)
EPS - Diluted ($USD)$(1.08) $0.45 $(0.19)

Notes:

  • Q2 GAAP profitability driven by a $47.987M one-time gain on sale to Novo Nordisk .

Revenue Composition (Quarterly)

Revenue ComponentQ1 2024Q2 2024Q3 2024
Service Revenue ($USD Thousands)$7,721 $4,621 $2,850
Collaborative Arrangement Revenue ($USD Thousands)$4,714 $4,346 $10,684
Royalty & Other Revenue ($USD Thousands)$0 $1,992 $0
Total Revenues ($USD Thousands)$12,435 $8,967 $13,534

Abecma U.S. Commercial Revenue (Reported by BMS)

MetricQ1 2024Q2 2024Q3 2024
Abecma U.S. Revenue ($USD Millions)$52 $54 $77

KPIs and Operating Profile

KPIQ1 2024Q2 2024Q3 2024
Cash, Cash Equivalents, and Marketable Securities ($USD Millions)$181.4 $201.9 $192.4
Total Operating Expenses ($USD Thousands)$63,589 $36,036 $27,475
Research & Development ($USD Thousands)$43,931 $16,013 $8,320
SG&A ($USD Thousands)$12,659 $9,857 $12,884

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Abecma U.S. RevenueFY 2024Not provided earlier~$240–$250M Initiated
Net Cash SpendFY 2024$80–$100M (early year) $40–$60M (revised and reiterated) Lowered
Company Breakeven Sales Threshold (U.S. Abecma)Ongoing~$400M (prior) ~“closer to $300M” Lowered
Cash RunwayMulti-yearBeyond 2027 (prior) Beyond 2027 (reiterated) Maintained
KarMMa-9 EnrollmentNDMM studyActiveDiscontinued; >$80M near-term savings Cost-saving action

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2)Current Period (Q3)Trend
Commercial trajectory and demandEarly third-line launch; apheresis growth; expectation of second-half revenue growth 42% QoQ Abecma revenue growth to $77M; less than ~25% third-line penetration; steady build vs prior bolus dynamic Improving demand; scope to grow
Competitive/safety positioningDifferentiated safety vs bispecifics; messaging on efficacy and RWE; ODAC discussion on PFS and safety Continued emphasis on safety profile and optimized bridging; reiteration of boxed warnings and KarMMa-3 safety info Consistent messaging; bridging importance
Manufacturing success and marginsApproved suspension vector; success rates >90%; margin improves with volume Success rate “north of 95%”; margin improvement driven by demand and manufacturing Operationally improving
Seasonality and schedulingNot highlightedQ4 expected impact from holiday season scheduling Near-term headwind
Cost structure and breakevenMajor cost reductions; FY net cash spend lowered; path to breakeven 2025 OpEx down 24% QoQ; breakeven sales threshold guided down to ~$300M Positive operating leverage
Regulatory/RWE narrativeKarMMa-3 approval; RWE supports safety/efficacy Slides reinforce PFS, ORR and RWE consistency; OS confounded by crossover Reinforced clinical profile
Portfolio focusR&D divestitures to Regeneron/Novo; exclusive focus on Abecma Continued sole focus; KarMMa-9 discontinued to conserve capital Focused execution

Management Commentary

  • CEO: “We are very pleased to report 42% sequential growth in quarterly Abecma sales… and streamlining our cost structure… achieving breakeven operations” .
  • CFO: “We see really strong manufacturing success rate north of 95%.… closer to $300M is what I would guide” (breakeven sales threshold) .
  • CEO on market penetration: “Less than 25% penetrated in the overall third line setting… plenty of room to grow” .
  • Strategic discipline: “Discontinue enrollment in KarMMa-9… conserve over $80 million… accelerates our path to breakeven” .

Q&A Highlights

  • Margin improvement drivers: Higher demand through a fixed-cost base and manufacturing success >95% lifted ABECMA profit share margins; breakeven threshold guided to ~$300M .
  • Seasonality: Q4 CAR-T scheduling typically dips around U.S. holidays; demand trend remains positive post-third-line approval .
  • Apheresis activity: Growth tracked weekly; Q3 uptick expected to pull through to revenue; holiday season impacts near-term cadence .
  • Safety and positioning: Physicians value differentiated safety profile; bridging therapy prior to infusion improves outcomes; RWE consistent with clinical data .
  • Capacity and operations: Capacity adequate; continued manufacturing improvements and site expansion underpin commercial execution .

Estimates Context

  • We attempted to retrieve S&P Global Wall Street consensus for Q3 but the SPGI CIQ mapping for TSVT was unavailable in our system at the time, limiting beat/miss analysis versus Street expectations. As a result, estimate comparisons are unavailable and not included (S&P Global consensus unavailable due to CIQ mapping for TSVT).
  • Management’s FY Abecma U.S. revenue guidance ($240–$250M) and updated breakeven threshold (~$300M sales) may prompt upward revisions to margin and cash burn assumptions in models focused on fixed-cost absorption and manufacturing yields .

Key Takeaways for Investors

  • Sequential inflection: Abecma U.S. revenue rose 42% QoQ to $77M, evidencing traction in third-line and improved site throughput; total revenue was $13.5M, and net loss improved materially YoY .
  • Operating leverage: Higher volumes plus >95% manufacturing success rate are improving ABECMA margins; breakeven sales threshold lowered to ~$300M, enhancing medium-term cash flow prospects .
  • Cost actions: Discontinuation of KarMMa-9 enrollment conserves >$80M; OpEx down 24% QoQ and ~52% YTD, supporting a path to breakeven potentially in 2025 .
  • Safety narrative and bridging: Continued emphasis on safety profile and the importance of optimized bridging in earlier lines; RWE supports efficacy and safety consistency, though OS interpretability is confounded by crossover .
  • Near-term cadence: Expect Q4 seasonality to temper scheduling despite full-year guidance; underlying demand trend remains favorable post-approval .
  • Cash runway intact: ~$192.4M in cash and securities; runway beyond 2027 provides time to execute commercial strategy and realize operating leverage .
  • Monitoring points: Watch apheresis trends, manufacturing success rates, site expansion, and competitive dynamics vs bispecifics; reassess breakeven timing as volumes scale .

All information above is sourced from 2seventy bio’s Q3 2024 8-K press release and exhibits, and Q3/Q2/Q1 earnings call transcripts: .