Maravai LifeSciences (MRVI) 7 Nov 24 2024 Q3 Earnings call transcript

Maravai LifeSciences' third quarter 2024 earnings call presented a mix of promising growth opportunities and challenges for the biotech company. The call, led by Debra Hart, Trey Martin, Kevin Herde, and other executives, offered valuable insights into the company's performance, strategic plans, and market dynamics.

Market Performance and Challenges

The company reported $65 million in revenue, slightly below expectations, primarily due to customer-requested program timing shifts, muted demand in research and discovery products, and persistent softness in the global biologics market. These factors impacted both the Nucleic Acid Production (NAP) and Biologics Safety Testing (BST) segments.

However, Maravai LifeSciences highlighted significant achievements, such as the largest service build to date at the Wateridge site, which has reached 26 grams of mRNA material for a preclinical cell and gene therapy customer. This achievement underscores the company's commitment to advancing the field of mRNA-based therapies and its role in the development of mRNA-based in vivo gene editing, gene-edited cell therapies, protein replacement therapies, cancer vaccines, and infectious disease vaccines.

Strategic Acquisitions and Innovation

Maravai LifeSciences announced its plans to acquire the DNA and RNA business of Officinae Bio, which specializes in precision DNA and RNA services through an AI-driven digital platform. This acquisition is expected to enhance Maravai's mRNA offering for early-phase discovery work and provide complementary capabilities to the company's NAP product portfolio.

Moreover, Maravai LifeSciences has introduced 21 new products in the NAP business segment, expanding its discovery mRNA synthesis services offerings with new custom sets of mRNA and launching plate-based mRNA services for screening and hit-to-lead optimization. These innovations are designed to enable and lead the field by launching sets of up to 96 mRNA constructs, providing customers with the flexibility to optimize the performance of their specific targets and accelerating the development of life-changing mRNA-based therapeutics.

Financial Performance and Outlook

The company's financial performance was slightly below expectations, with a loss of $0.02 in adjusted fully diluted earnings per share. The NAP segment accounted for 77% of the company's total revenue, generating $50 million. However, the company faced challenges in the BST segment, which was impacted by a soft bioprocessing market and customer program delays.

Looking ahead, Maravai LifeSciences is lowering its expected revenue range for 2024 to between $255 million and $265 million, a reduction of $15 million or 5% from the previous forecast. This revision is attributed to a $5 million shortfall in Q3 and a lower outlook for Q4 due to customer program delays and lower-than-anticipated large CleanCap orders.

Conclusion

Maravai LifeSciences' earnings call highlighted both challenges and opportunities for the company. Despite facing some revenue shortfalls and market challenges, the company is making strategic acquisitions and innovations to expand its offerings in the mRNA and gene editing markets. With a strong focus on these emerging technologies and a commitment to customer-centric solutions, Maravai LifeSciences is well-positioned to navigate the evolving biotech landscape and continue driving growth and value for its stakeholders.