Schrödinger (SDGR) Q3 Earnings call transcript Nov 12, 2024
1min read Schrodinger, a pioneer in computational drug discovery, recently held its third quarter 2024 earnings call, providing insights into its financial performance and strategic initiatives. The call, led by Senior Vice President of Investor Relations and Corporate Affairs, Jaren Madden, featured updates from CEO Ramy Farid, President of R&D and Therapeutics Karen Akinsanya, and CFO Geoff Porges.
Strategic Partnership with Novartis: A Game Changer
One of the most notable highlights of the call was Schrodinger's strategic partnership with Novartis, a leading global pharmaceutical company. Under this multi-target collaboration, Schrodinger and Novartis will combine their efforts to advance therapeutics for undisclosed targets outside of oncology. The agreement includes a $150 million upfront payment and potential milestone payments, signaling a significant step forward for Schrodinger in the drug discovery space.
Financial Performance: A Mixed Bag
Schrodinger reported a total revenue of $35.3 million for the third quarter, a decrease from the previous year. However, software revenue of $31.9 million showed a 10% increase compared to the same period last year. This growth is attributed to the increase in hosted software licenses and the expansion of Novartis' software access. Despite the revenue decrease, the company is optimistic about the remainder of the year, citing high customer engagement and expected scale-ups.
Pipeline Progress: A Focus on Clinical Trials
Schrodinger's pipeline is progressing, with three clinical stage programs advancing, including SGR-1505 for relapsed/refractory B-cell lymphomas, SGR-2921 for relapsed/refractory acute myeloid leukemia or high-risk myelodysplastic syndrome, and SGR-3515 for advanced solid tumors. Initial data from all three programs is expected next year.
Looking Ahead: Expanding the Horizon
Schrodinger is looking forward to the future, with a focus on expanding its software business and advancing its collaborative and proprietary drug discovery programs. The company's strategic partnership with Novartis is expected to accelerate this growth, as it increases access to its computational technology and enterprise informatics platform.
In conclusion, Schrodinger's Q3 earnings call underscores its strategic move towards drug discovery, with a focus on partnerships and technological advancements. The collaboration with Novartis is a significant step in this direction, opening new opportunities for the company in the drug discovery space. Despite some financial challenges, Schrodinger remains optimistic about its future, with a clear vision of advancing its proprietary pipeline and capitalizing on its computational capabilities.