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AbCellera Biologics(NASDAQ: ABCL)
Q3 2023 Earnings Call
Nov 02, 2023, 5:00 p.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
Prepared Remarks:
Operator
Good afternoon, and welcome to AbCellera's third quarter 2023 business update conference call. My name is Kate, and I will facilitate the audio portion of today's interactive broadcast. [Operator instructions] At this time, I would like to turn the call over to Tryn Stimart, AbCellera's chief legal and compliance officer. You may proceed.
Tryn Stimart -- Chief Legal and Compliance Officer
Thank you. Good afternoon, and welcome to AbCellera's third quarter 2023 business update. We are pleased to have you with us today as we discuss the results announced in our press release issued after the market closed today, which you can find on our investor relations website. With me on the call today are Dr.
Carl Hansen, AbCellera's chief executive officer and president; and Andrew Booth, AbCellera's chief financial officer. The webcast portion of this call contains a slide presentation that we will refer to during the call. If you are following along on the phone and wish to access the slide portion of this presentation, you may do so on the investor relations section of our website. For those of you who have accessed the streaming portion of the webcast, please be aware that there may be a delay and that you will not be able to post questions via the web.
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This presentation may contain forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any forward-looking statements are based on management's current expectations and are subject to certain risks and uncertainties. Please review our SEC filings for risk factors that could impact our future performance. Our presentation and SEC filings are available on our investor relations website.
Note that all dollars referred to during our call today are U.S. dollars. Now I am pleased to turn the call over to Dr. Carl Hansen.
Carl Hansen -- Chief Executive Officer and President
Thanks, Tryn. The highlight this quarter is that we are advancing assets from two AbCellera-led programs into IND-enabling studies. The first asset, ABCL575 targets Ox40 ligand and is being developed as a potential best-in-class therapy for the treatment of atopic dermatitis and other indications in autoimmunity and inflammation. We discovered ABCL575 during our collaboration with EQRx as part of the co-development program that was initiated in 2021.
We took ownership of this program in September after EQRx was acquired by Revolution Medicines. ABCL575 has been designed with potency, PK and developability to enable less frequent dosing, which provides a potential for differentiation. At present, we believe ABCL575 has the potential to be one of the first assets to follow amlitelimab, which is being developed by Sanofi and which recently had a positive Phase 2 readout providing evidence for the potential of this new class. Our second asset, ABCL635 is against an undisclosed target with an indication in metabolic and endocrine conditions.
It has the potential to be a first-in-class therapy in a market segment estimated at more than $2 billion in annual sales. For strategic reasons, we will disclose more details of this program an indication only once it reaches the clinic. ABCL635 is the first AbCellera-led asset derived from our GPCR and Ion Channel platform and is aligned with our strategy of leveraging our expertise and technology advantage to create an internal pipeline of first-in-class assets. We anticipate additional development candidates in the next 12 to 18 months from this platform, and we will announce them only when we have committed to move them forward into IND-enabling studies.
We would caution that studies leading to an IND carry significant risk. That said, if things progress as expected, we would anticipate IND submissions for both ABCL575 and ABCL635 in 2025. For both programs, we see the potential to get early efficacy -- for both programs, we see the potential to get early efficacy data from clinical trials. We believe that these two assets and future programs will provide growing evidence that we can repeatedly generate potential first-in-class and best-in-class therapies.
Given the breadth of our discovery activities, we anticipate generating more assets than we will have the bandwidth or capital to advance ourselves. Thus, we will be selective in the ones we bring forward into the clinic and expect partnering and out-licensing to remain an important part of our strategy. Turning to partnering. In September, we announced a new partnership with Incyte working in the area of oncology.
We also expanded our existing collaboration with Regeneron. Under the original agreement, Regeneron has exercised its rights to advance antibody candidates from two completed programs, including one against a GPCR target. Other programs are still active. In addition to the two partnerships completed in the quarter, yesterday, we also announced a collaboration with Prelude Therapeutics to codevelop novel precision antibody drug conjugates, or ADCs, in oncology.
We are excited to be working with the Prelude team on the development of a new class of therapeutics with the first program focused on antibodies armed with small molecule protein degraders. In summary, I would like to highlight that developments over this quarter are aligned with key business objectives that we laid out last year. First, we said we would elect at least one candidate from our GPCR and Ion Channel platform and at least one candidate from a co-development platform for IND-enabling studies in 2023. With the commitment to advance ABCL575 and ABCL635, we have achieved that milestone.
Second, we said we would focus on high-value strategic partnerships. Our deals with groups like Regeneron, Prelude and Incyte are aligned with this strategy. We also said we would advance our T-cell engager platform and expected to enter into a significant transaction in 2023. The science and the development of this platform continue to progress as expected.
And tomorrow, our team will be presenting new data at SITC in San Diego. While we haven't completed a transaction yet, we have increasing conviction in our TCE platform, both in its potential to generate internal assets and as a basis for strategic partnerships. And with that, I will hand it over to Andrew to discuss our financials. Andrew?
Andrew Booth -- Chief Financial Officer
Thanks, Carl. First, let me highlight the progress made on our key business metrics during the third quarter of 2023. This quarter, we worked on four new discovery programs taking us to a cumulative total of 110 partnered program starts. And as a reminder, the number of starts in any given quarter will be irregular.
Over the trailing 12 months, we've started work on 18 partner-initiated programs. We agreed to five new programs under contract in the quarter and ended the third quarter of 2023 with 182 programs under contract with 42 unique partners. As we've stated in the past, we continue to focus on strategic partnerships rather than on deal volume. Our key business metrics do not include programs that are initiated by AbCellera internally.
In Q3 of 2023, we saw NovaRock advance an additional molecule into the clinic for a cumulative total of 10 molecules in the clinic. We view our growing list of molecules in the clinic as specific examples of our near and midterm potential revenue from downstream milestone fees and royalty payments in the longer term. Turning to revenue. Revenue in the quarter was approximately $7 million, almost entirely driven by research fees relating on work on partnership initiated discovery programs.
This compares to research fee revenue of approximately $8 million in Q3 of 2022. This reduction of research fee revenue is consistent with our increasing focus on more strategic partnerships where AbCellera has a larger participation in the long-term value of the program. This quarter's revenue also includes some small amounts related to licensing fees. And unlike a year ago, there were no royalties and no milestone payments earned in the quarter.
Turning to operating expenses. Our research and development expenses for the third quarter were approximately $38 million, representing a roughly $11 million increase over the same period of the previous year. This increase reflects the growth of program execution, continuing platform development and our investment in internal programs. In sales and marketing, expenses for the quarter were $3.5 million, compared to just over $3 million in Q3 of 2022.
And in general and administration, expenses were just over $14 million, compared to just under $14 million in Q3 of the previous year, reflecting good operating leverage. Looking at earnings. We're reporting a net loss of roughly $29 million. This compares to earnings of approximately $27 million in Q3 of 2022, the loss reflects our continued investments in the business and the absence of the royalty revenues that were present in Q3 of the previous year.
In terms of earnings per share, this quarter's results work out to a loss of $0.10 per share on a basic and diluted basis. Looking at cash flows. Operating activities for the first nine months of 2023 used roughly $24 million. In the absence of regular royalty revenues, we would expect our quarterly operating cash flow to be irregular and often negative as we continue to invest in the growth and capabilities of the company.
Of note, from operations and investment activities in the third quarter, we used approximately $10 million of cash. As a part of our treasury strategy, we have over $600 million invested in short-term marketable securities. Our investment activities for the first nine months of the year include approximately $113 million net increase in these holdings. All other investment activities amounted to approximately $95 million, including approximately $62 million invested in property, plant and equipment and approximately $37 million in other long-term investments.
Investments in property, plant and equipment are, of course, driven in large part by our ongoing work to establish CMC and GMP manufacturing capabilities. Altogether, we finished the quarter with over $813 million of total cash, cash equivalents and marketable securities. We have historically been successful at raising nondilutive sources of capital. And as a reminder, our continuing GMP facility build-out is separately co-funded by the Government of Canada's Strategic Innovation Fund.
This available capital does not show up on our balance sheet. With over $800 million on the balance sheet and the unused portion of our previously secured government funding, we continue to have over $1 billion in total available liquidity. This is more than our liquidity position from one year ago when we reported our Q3 of 2022 financials. With respect to our operating expenditures, our capital need programs toward and into the clinic with excellent visibility and runway.
We continue to believe that we have sufficient liquidity to fund well beyond the next three years of platform and pipeline investments and overall growth. And with that, we'll be happy to take your questions. Operator?
Questions & Answers:
Operator
[Operator instructions] The first question will be from the line of Allison Bratzel with Piper Sandler.
Allison Bratzel -- Piper Sandler -- Analyst
Thanks for the update. I guess, could you maybe just speak more on what we can expect to see for the T-cell engager platform tomorrow in the posters at SITC? And really just help frame what's the bar you think potential partners are really looking for in order to have confidence that your TCE platform really is best-in-class and pull the trigger on a partnership. Your latest thoughts on the setup there would be really helpful.
Carl Hansen -- Chief Executive Officer and President
Sure. Thanks, Allison, Carl here. Happy to take that. So we have continued to make great progress here.
The SITC presentations really focus on two developments on the R&D platform. One of them is the advancement of the platform toward being able to generate antibodies against MHC peptide targets. We see that as highly differentiated and a capability that opens up a broad array of targets that are expressed inside the cell, but that get presented to the surface of the cell and are highly specific to tumors. So being able to do that solves one of the key problems in TCEs, which is being able to find targets that are specific and reduce the on-target off-tumor toxicity.
The other big highlight is evidence that shows that combining a broad diversity of CD3 binders with the OrthoMab platform and being able to change both the affinity of binders and the epitope importantly, allows you to obtain profiles in the mixture of cytokine release and killing that you cannot obtain using just affinity alone or many of the existing antibodies. That was the original thesis, and we have continued to push that forward and see it as very compelling in cases in particular, where dose-limited toxicity has been a problem. What's not being shown at SITC, but something we're also excited about is more recent data that very clearly shows that you can decouple cell killing from cytokine release. That's something that has been pursued for some time.
And in our hands, we think we have by far the clearest demonstration of that as compared to benchmarks that we've tested our antibodies against. So all of that is going very well. The timing of a transaction, I think, is always difficult to predict. But we are engaged with the top groups and have built relationships over the last year.
And on all fronts, I think, it's going in the right direction.
Operator
The next question will be from the line of Robyn Karnauskas with Truist.
Robyn Karnauskas -- Truist Securities -- Analyst
I'm going to ask the one that you may not be able to answer, but maybe you can address it more broadly as to your capabilities. So Regeneron this morning mentioned that they're Ox40 on their call may not be optimal. The target may not be safe versus Dupixent. How can you design things differently with this molecule to improve its specificity or make it a safe therapeutic index achievable? And maybe less potent payload, cable linker, bystander, if you won't address that molecule specifically for competitive reasons, maybe just address liquor capabilities more broadly because I think a lot of companies are facing these challenges where they have a suboptimal drug that could be better? And how are you thinking about that?
Carl Hansen -- Chief Executive Officer and President
Sure, Robyn. I'm happy to take that. So I think, your question was related to ABCL575, which is our antibody that we're bringing forward against Ox40 ligand. Maybe a few things to say about that.
We're excited about that one for a few reasons. One is, we see this as a very compelling class, not just for atopic dermatitis, but for a wide array of different conditions and inflammation. It is a pathway for which there is a robust scientific literature that suggests that it is able to affect in multiple pathways in the inflammation cascade and that it can do it in a way that not only suppresses the activation and proliferation of T-effector cells and T memory cells that are associated with disease, but also that can interact with T regulatory cells to help to reset homeostasis in the immune system. That body of evidence makes it a compelling pathway.
The recent readout from Sanofi that we mentioned looks completely in line with that. So it looks to be safe. It looks to be effective. And what was interesting in that study is that the effects seem to get better over time, which is what you'd expect if you were able to reset the immune system.
So for all those reasons, we think the pathway is very exciting and has broad potential in a growing space in atopic dermatitis and also in other conditions. ABCL575, as I said, we believe, is one of the first behind it. Now you don't know what people have inside their pipeline that they haven't disclosed. But based on disclosures, we think this one has the potential to be one of the first to come behind it.
And we have engineered it in a way that we think provides the combination of potency and developability and formulation and half-life that would give an advantage in dosing. So that's why we're excited about that particular one. As it compares, I think you mentioned Regeneron and Dupixent. Dupixent is, obviously, an amazing drug.
Our view is that in inflammation, not every patient responds to the therapies that are available, and there is a lot of interest in finding alternatives and perhaps even combining therapies in the future. So we don't see that as a negative at all, but rather as an example of the huge opportunity that exists in this space.
Robyn Karnauskas -- Truist Securities -- Analyst
And just as a follow-up, do you think you can improve upon -- I mean, their view is that the current ones they have are just not going to -- or current ones that are on the market are too dirty, I would use that word like they're too broad? Like what AbCellera technology can you use to understand to make a better Ox40 because that is a hot target right now. So, maybe you can show up what the technology as well, and then I'm getting back in the queue.
Carl Hansen -- Chief Executive Officer and President
So to be clear, so we have an antibody that is going to get Ox40 ligand, not Ox40. There is, of course, an Ox40 antibody that is being developed by Amgen. That antibody is a depleting antibody. So it's an antibody that binds Ox40, which is presented on T cells and that causes the ablation of those T cells.
There's some evidence that that may cause problems. I mean, I don't want to speculate too much. The antibody that we have engaged an Ox40 ligand, which is not presented on T cells, but rather on antigen presenting cells. And our antibody has been engineered to be non-ablating.
So it has Fc Function that does not result in the killing of the antigen presenting cells, very similar to amlitelimab, which I mentioned, which is being developed by Sanofi. So we don't see a problem with it being dirty. We don't see a big problem with toxicity. And of course, we're getting that information from the disclosure that Sanofi has made and they've got the most advanced molecules.
So to our knowledge, this looks like a quite clean profile and one that's effective and one that has a lot of potential in inflammation and other conditions.
Operator
The next question will be from the line of Andrea Tan with Goldman Sachs.
Andrea Tan -- Goldman Sachs -- Analyst
Carl, maybe one more question for you on 575 here. Strategically, can you speak to the decision to pursue atopic derm as the initial indication. Just curious given how crowded that landscape is. If there are other indications where mechanistically, it might make sense to also bring this asset forward but one where you could have an advantage of being first-in-class.
Carl Hansen -- Chief Executive Officer and President
That's a great question. I mean, atopic dermatitis is the most obvious place because there is the data out already showing efficacy. It's also -- in derm is one of the easier places to get early clinical data that shows efficacy, let's say, in a Phase 1 or 2a trial. So that's probably the main reason.
We feel based on the pathway and what we've seen in the clinic from other molecules that this has a very high likelihood of working, not just in atopic dermatitis, but in other conditions. That's our sense right now. But this is a competitive space, as you mentioned. So right now, what's most important is that we not delay in getting this molecule through to the start of clinical development and through the early trials.
There's going to be a lot of consideration and thinking between here and there. And so, we may change that, but it's also perhaps worth saying that at some point, I think it would be advantageous to find a large and highly enabled partner to accelerate clinical development because this is a molecule that would have potential in a variety of different classes and something that probably is done best by a big company. So that would be our current feeling right now in terms of subsequent steps. But as I said, the priority right now is to get this through to clinical development and to get that early proof of concept.
Andrea Tan -- Goldman Sachs -- Analyst
Perfect. And maybe a follow-up there. Can you just remind us of your willingness to advance these programs on your own, I guess, maybe the extent to which you would bring them through clinical development.
Carl Hansen -- Chief Executive Officer and President
Sure. Happy to address that. This is a question that I get a lot, and it's often framed as -- what is your strategy for internal programs? My response to this is normally that it's wrong to think of a single strategy for internal programs. Every program needs to be considered on its own merits.
Every program will have different time lines, different costs, different operational challenges and clinical development. And of course, as things progress, there'll be different priorities in the company and capital allocation and different strategic opportunities. The way we think about it is that right now, we have committed to bring ABCL635 and ABCL575 through to the end of Phase 1. It's possible that could get intercepted with the right business opportunity, but we are full steam ahead to do that.
After we get to that point, we will evaluate the risk/reward and do what's best for the business and where we think we're going to get the best return on investment. And I would not take it off the table that we would advance one into further trials, if we thought that that was the best path.
Andrew Booth -- Chief Financial Officer
And just, Andrea, if I can add there as well, this is Andrew speaking, the announcement we had earlier in the year about receiving some government funding allow us to move molecules. That included funding molecules that we would advance into Phase 1 and received some significant amount of government funding that make it quite capital efficient for us to do that. So this is completely consistent with that announcement and that strategy.
Operator
The next question will be from the line of Stephen Willey with Stifel.
Stephen Willey -- Stifel Financial Corp. -- Analyst
And congrats on procuring the Ox40 ligand antibody. I think, it's interesting that you said both been birthed by antibody platform discovery companies. I guess, with respect to the Prelude deal, can you just talk a little bit about what you think makes a good antibody for the purposes of delivering a degrader. I guess, do you want to have the same level of high internalization that you sometimes see on some more kind of chemo conventional ADCs? Or is there a different kind of chemical angle that you want to take here? And just given that I think the degrader that they're hoping to administer here this market to, which is, I think, relevant in SMARCA4 efficient tumors is probably relevant across a variety of different tumor types requiring a variety of different target antigens.
Does this collaboration contemplate the notion that you could develop multiple antibody scaffolds that are targeted toward a specific tumor type, and then they can just kind of cut and paste their version of a SMARCA2 degrader on top of that?
Carl Hansen -- Chief Executive Officer and President
Great questions. Let me start by saying that we're excited about the collaboration. We have emphasized our focus on strategic partnerships. This one is certainly a five-star strategic partnership in that we have two teams that are very experienced and have deep expertise on two sides of the molecule that you need, the small molecule development and the antibody development coming together to enable what we think will be an exciting new class of antibody conjugates.
The first program, as you rightly pointed out, is an antibody conjugate for a degrader. It will be related to SMARCA. I think that may have even been mentioned in the press release. The question about what exactly do you want an antibody to do to be effective.
I think, is the thing that we're going to be working together to figure out. We've got some hypothesis about what might be needed. But the proof is ultimately in the assays that you do preclinically to show that you can get a good therapeutic index and deliver enough degrader at the effect that you want in the tumors. So this is the first of the programs.
There certainly is the potential for that particular small molecule degrader to go into different cancers, and that would require a different antibody. So that's on the table. The collaboration has the potential also to go into other antibody drug conjugates where the concept is to use small molecules, not just as sort of a blend instrument poison, like many cytotoxics, but to be much more targeted at precision pathways. And that could be degraders that could also be other molecular entities that the team at Prelude is able to bring forward.
So we're at the very beginning of this, one of the big values for both teams is we get into a new space and we'll be learning and working together. And we're excited about the chance to do something that makes a difference for patients. And hopefully – and I've got confidence this will be a successful one, and we'll be able to update you as it progresses.
Operator
The next question will be from the line of Puneet Souda with Leerink Partners.
Puneet Souda -- SVB Securities -- Analyst
A couple of questions here. Just maybe first a simple one for 575 and 675. When do we see the early data here for both of them? Maybe just let's start there.
Carl Hansen -- Chief Executive Officer and President
Yes. So for 575, I expect that we will provide some data -- some preclinical data ahead of IND filing. I'm not sure exactly on the time line right now, but we'll update you with that as it comes along. For 635, as mentioned, for strategic reasons, we do not think it would be wiser in the interest of the business to disclose the target or even the indication.
And so, that one, we're going to keep close to our chest until it gets to IND.
Andrew Booth -- Chief Financial Officer
And Puneet -- sorry, Carl mentioned in his prepared remarks, but the INDs would be in 2025.
Puneet Souda -- SVB Securities -- Analyst
Yes, yes. So that's -- that's kind of related to my sort of second question is, Andrew, can you just remind us what the level of investment or capex that you have toward the GMP facility, sort of the outlay that you have for 2024 here before the opening of that facility. And obviously, if you have a drug that's going to be filed into sort of IND, this is -- there's a lot of early stage work that needs to be done. So can you maybe talk about sort of how are you going to set the priority for or who's going to set the priority for what is going to be manufactured in that GMP facility.
And then, maybe just -- if you look at the overall capacity in the CDMO landscape today, there's a bit of an overcapacity situation. Does that impact you at all as you think about how to fill that facility in '25?
Carl Hansen -- Chief Executive Officer and President
Carl, here. Maybe I'll start, and Andrew can fill in if I miss something. So first of all, for the first two programs, ABCL575 and ABCL635, we will be having these manufactured by a third-party since our manufacturing facility is not up and running. And for both programs, we believe it's imperative these move forward as quickly as possible.
The manufacturing capability should come online in 2025. That's the same year that the INDs we expect to be filed for 635 and 575. The first program through the GMP facility are very likely to be AbCellera internal programs. We also expect that we'll be doing programs that come from strategic partnerships, obviously, with firms that do not have large manufacturing capabilities internally.
The last part of your question was, does it affect you that there's a slowdown, let's say, in a lot of the CDMO market that I think is broadly tracking the macro environment today. Perhaps there is some effect of that, but we are expecting to use our facility not as a CDMO. So we're not going to be taking inbound on molecules that we have not developed ourselves. So the pipeline that we expect to put into the manufacturing facility is molecules that have been done either internally or at AbCellera or that have been done at AbCellera in collaboration with partners.
And so, based on that, I think we've got a good line of sight as to what will be used in the facility.
Puneet Souda -- SVB Securities -- Analyst
Got it. And then, maybe this is a sort of a tendential question. The Beacon platform for antibody discovery changed hands and now acquired by Bruker. Could you maybe update us on if that changes your thinking a bit on the sort of the competitive landscape there? And I just wanted to make sure what's left on the litigation front there? If you could just clarify.
Andrew Booth -- Chief Financial Officer
Yes, sure, Puneet, let me take that one. So as you know, the litigation with Berkeley Lights at the time and now Bruker started a couple of years ago, it went to -- the response was an attempt to invalidate the patents, which then stood up at the IP -- the IPR stood up in our favor and our patents are -- have been declared legitimate and in full force. That litigation was stayed during that process and has now been unstated and the litigation is now underway. We intend to continue to pursue that through the courts now in the hands of Bruker, and we'll wait to see what the outcome of that proceeding is, but we would expect that to continue over the course of 2024 and maybe even into 2025.
Operator
The next question will be from the line of Steven Mah with Cowen.
Steven Mah -- Cowen and Company -- Analyst
Great. On the new partner adds, can you give us some color on what you're seeing given the macro environment? Maybe give us some color on the level of your inbound and discussions with potential partners. And if these inbounds and discussions are weighted more to one type of player, larger or smaller. And I ask that given that the Prelude was a little bit on the smaller side.
Carl Hansen -- Chief Executive Officer and President
Yes. So Carl, here, happy to take that. First, on the macro, I think you don't have to be a biotech analyst to see that this is a bare market for biotech and has been for some time. So what that means is that there is absolutely a slowdown in the formation of new companies and financing new companies.
The companies that are out are preserving capital. They are prioritizing programs. And all of that results in a smaller ocean of opportunities for partnering. So that said, we have, for the last two years, been consistently communicating that our focus is not on deal volume.
Our focus is on finding strategic partnerships where strategic means one of two things. It either means that we found a company that is bringing a unique technology such as Prelude or a company that is bringing unique target insight and biology. And that together with them, we have a great opportunity to make a therapeutic that we have conviction in and that we're able to get a significant stake in that therapeutic. So that's the first category of strategic.
The second category is relationship building and setting up deeper engagements with some of the very large and well-enabled companies, companies like Regeneron, companies like Incyte. So examples from this quarter that line up with that. That means that we are looking at lower volume. It also means that we're primarily looking at the bigger firms.
The bigger firms are quite robust in this market. They're continuing to invest in R&D. And so, I don't think that we're going to see a lot of impact on that, and we're just going to continue with our strategy.
Steven Mah -- Cowen and Company -- Analyst
OK. Great. And if I can just have one more. Has there been any changes to the timing of the GMP biologics manufacturing facility? And then also, as you start building out that downstream capability, is that impacting your partnership discussions? And again, I asked because I wanted to -- just curious to know if maybe the Prelude collaboration was helped by the GMP biologics manufacturing capabilities that you're building in?
Andrew Booth -- Chief Financial Officer
Yes, I'll take the first part of that question, Steve, it's Andrew here. So we continue to invest in both the CMC and GMP manufacturing. I think, our plan is to have the first sort of pilot batches and engineering batches for CMC development happening in 2024. So that will be next year.
And the first -- the engineering batches, qualification batches of the production facility would be in 2025. And those -- that is also when the first batches from the facility that would ultimately go to support of Phase 1. That does mean that the discovery on the programs that we're starting today could be advanced through our own CMC cell line development and then GMP manufacturing capabilities. And I think that is of interest to partners, but I'll maybe let Carl comment a little bit more on that.
Carl Hansen -- Chief Executive Officer and President
Yes. Not too much to add except that we have a variety of discussions, particularly in the space of new venture creation or early companies, obviously, that are not equipped with manufacturing capabilities internally, where the integration of the front-end discovery, lead optimization, translational science, CMC, GMP altogether is a very attractive part of working with AbCellera. It provides a way to substantially shrink the time in going from an idea through to the start of clinical development. And frankly, release a huge amount of hassle that exists, particularly for smaller firms when they're having to set up CDMO networks and relationships and manage that and jockey with the bigger firms to make sure that their programs are coming in, in the right slots and with some flexibility.
So we see it as a very important strategic advantage, that's why we're investing in it. It's a heavy lift to put it together, but we're crossing that right now and are confident that we'll have that in place in 2025, as Andrew said.
Operator
The next question will be from the line of Malcolm Hoffman with BML.
Malcolm Hoffman -- BML -- Analyst
Malcolm on for Evan. I wanted to first ask about ABCL575. It's noted that the molecule has been designed with greater potency and PK to enable less frequent dosing than benchmark molecules. Are you able to provide more color on what those benchmark molecules are.
Are they the approved assets or other in development molecules from AbCellera?
Carl Hansen -- Chief Executive Officer and President
Sure. So to be clear, what I said is that it's been engineered and selected to have a combination of potency, PK and developability, particularly meaning high concentration formulations that we believe would allow it to be dosed less frequently than existing benchmark molecules. We are, of course, testing the ones that are disclosed out there. Amongst them are the clinical assets, including the one I mentioned earlier.
Operator
Thank you. At this time, there are no additional questions registered in the queue, so I will turn the call back over to Carl for final remarks.
Carl Hansen -- Chief Executive Officer and President
Thank you, everyone, for joining the call today. This remains an exciting time for AbCellera with two big milestones in advancing our development candidates forward. We look forward to keeping you updated on future calls, and wish you well.
Operator
[Operator signoff]
Duration: 0 minutes
Call participants:
Tryn Stimart -- Chief Legal and Compliance Officer
Carl Hansen -- Chief Executive Officer and President
Andrew Booth -- Chief Financial Officer
Allison Bratzel -- Piper Sandler -- Analyst
Robyn Karnauskas -- Truist Securities -- Analyst
Andrea Tan -- Goldman Sachs -- Analyst
Stephen Willey -- Stifel Financial Corp. -- Analyst
Puneet Souda -- SVB Securities -- Analyst
Steven Mah -- Cowen and Company -- Analyst
Malcolm Hoffman -- BML -- Analyst
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