MaxCyte Share Price (MXCT)

Good preliminary results delivered roughly when expected. As suspected, the year end cash position is even better than projected on 7th November update ($185m projected vs $190m disclosed 2 months later (today)). To me this points towards some good initial revenues from Casgevy - but it could be other factors as well.

I had hoped they would provide some further detail relating to Casgevy revenues as part of this update, but clearly they are keeping this back for when the full results are published in a couple of months. This may be because its more commercially sensitive (i.e., you could presumably work out the royalty % more easily when fewer patients have been treated, and holding this back maybe blurs the lines more, which is beneficial to the company):

'SPL program-related revenue and Total Revenue for the fourth quarter and full year 2024 is expected to be reported in March 2025'

Vertex will provide further guidance on the Casgevy roll-out with their 4th quarter and full year results in around 3 weeks, so we have that to look forward to.

Operating loss will have roughly halved in the space of a year (2023 $38m loss, vs 2024 approx $20m loss). The cost saving measures announced recently and the uplift from Casgevy revenues as the treatment is rolled-out could see us towards the point of break even in 2025.

Thanks. Another point of note is that as of 31st Dec 2023, total cash, cash equivalents was approximately $210 million.

Guidance for year end 2024 was $175 million (i.e. they were expecting a $35m loss).

RNS 7th August lifted this, stating: 'MaxCyte now expects to end 2024 with at least $180 million in total cash, cash equivalents and investments, up from an expected $175 million.'

RNS 7th Nov again lifted this, outlining 'Total cash, cash equivalents and investments were $196.6 million as of September 30, 2024', and 'MaxCyte now expects to end 2024 with approximately $185 million in total cash, cash equivalents and investments.'

So clearly they are doing better than initially forecast. Worst case, the projected $35m loss is going to be a $25m loss. Could well be better than that, considering the cash position was $196.6m, 3 months before the year end.

The preliminary results were published 9th January 2024 for the 2023 accounts, so we should have a pretty clear picture in a few weeks with any luck. This will also presumably include a lot more detail on Casgevy and any associated income, along with some hopefully positive forecasts for next year. Could be the catalyst for us to finally turn the corner.

They are clearly on 'under promise - over deliver' mode, which is usually well received.

Great post PB , I’ve been a holder here for years now and been steadily adding to my holding, looks very undervalued and I expect 25 to be a big year …this could easily double and some from here

Probably talking to myself here, but here goes.

As of November, 40 patients have been enrolled for transfusion with Casgevy, according to Vertex.

The list price is $2.2m per treatment, and Maxcyte has a ‘low single digit’ royalty on sales, which is commonly speculated to be 2 or 3%, but I don’t think has ever been confirmed by anyone.

40 x $2.2m = $88m – of which 2% would equate to $1.8m to Maxcyte, and 3% is $2.6m.

As of mid-October, 45 of the planned 75 authorized treatment centres (ATCs) have been activated in all regions of the world where Casgevy has been approved.

So in roughly 1 quarter, when ATC are still be developed and the first treatments are only just taking place, we have 40 patients enrolled, and guaranteed income (albeit modest) for Maxcyte.

Assuming enrollment stays at a steady 40 per quarter, this would equate to 160 PA ($350m total revenue; and royalties to Maxcyte of $7m to $10.5m).

However, given that the treatment is in its infancy and a further 30 ATCs are due to come on line, it would appear very unlikely that there would be just 160 patients per year.

I would speculate that 2025 sees a minimum of 300 patients per year, but the true figure could be higher. At 300 per year, sales would equate to $660m total revenue; and royalties to Maxcyte of $13m to $20m.

I’m presuming machine purchase and hire, along with consumables, would also increase revenues further.

On this basis, total company revenues next financial year could increase by 50% to circa $65m. The ‘streamlining’ measures announced in the RNS on the 9th Dec indicate that expenditure for 2025 is expected to decrease by $5.8m; which would come in at total operating expenditure of circa $80m.

We are therefore getting close to the point of the company being at break even, with even a modest tailwind from other milestone/SPL income from the 27 other licencing deals.

As Maxcyte keep saying, but the market apparently keeps ignoring ‘The outlook for the full year does not include SPL Program-related revenue from Vertex/CRISPR's CASGEVY’. When the full year results are announced in March, we could be in for a nice surprise. Certainly the calculations and projections will become a lot more clear at that point also.

In terms of peak sales. . . ‘Minter is still confident that Casgevy can eventually make $3 billion or more in annualized run rate. William Blair has clocked peak sales at $3.6 billion.’ You can do your own maths on that, but should it happen, then the company becomes very profitable based on that one treatment alone.

I think there is a growing sense of inevitability developing here. As you say, another two licencing agreements to add to the many others on the books.

I don't think the market has accepted yet (somehow) the scale of the opportunity, or indeed the likelihood (inevitability?) or it happening. The Crispr/Vertex FDA approvals fully validate the platform - the treatment is seen as potentially reaching peak sales of $3bn. Assuming, for arguments sake, it peaks at $1bn and Maxcyte has an approx 3% royalty on the sales, then that would result in $30m additional income annual from this one treatment. On top of that is the consumables (no idea what that would be worth per year, but presumably 7 figures), and additional sales/lease of the machines.

Crispr/Vertex have outlined that they intend to open 50 treatment centers, and you would have thought that each would have a one of the Maxcyte machines to produce the treatment. Previous investor presentations have outlined that they cost $250k p/a for lease for clinical use. Perhaps crispr/vertex will buy the machines for each site, but assuming they pay $250k p/a lease for each of the 50 sites, then that alone equates to a further $12.5m p/a in revenue.

This one treatment could therefore sustain circa $45m p/a in revenue for Maxcyte (based on conservative figures), which exceeds the entire current revenue. And this is just one programme. There are 25 partnerships signed since 2017, and 125+ clinical licences related to the partnerships, of which 2 are approved, 1 is in a pivotal trial, 10 are in phase 1/2, and numerous others are in phase 1. All of these will be leasing the machines, paying for the consumables, and potentially paying milestones should they progress.

Yet here we are, with circa $200m in cash, $400m mcap, and therefore $200m EV - which is frankly almost unbelievable. The upside is huge and, as I say, now almost inevitable.