908 Devices Inc. (NASDAQ:MASS) Q3 2022 Earnings Call Transcript

Kevin Knopp: Yes, absolutely. I mean from the selling conversations, you’re right, only about 20% of our REBEL’s are going into that selling gene. And while it is slowing, you would expect there’s additional opportunity to pursue there as well as outside of cell and gene. I think what we’re just generally seeing, down , is that people are slowing down their desire to grab new technology and change the way they’re doing it. We’ve literally had labs that have been good pull-through customers for us, go from having a dozen employees to down to 2 and they’re trying to build back again. So there’s a lot of training. There’s a lot of retraining, — there’s a lot of focus on taking the limited dollars they have and applying it to a replacement product or something status quo, and it takes work to adopt the new product, new technology and get across that chasm, if you will, and it takes effort on the customer side on 908 side, and it’s just a new way of doing things.

So I’d say across the board with the biopharma spending, we’re just seeing more of a reluctancy and a slowdown from that perspective.

Joe Griffith: On the pull-through. Dan, you’re asking about on the pull-through in device versus consumables. And as I noted, definitely an impact on the device side here in Q4 as we look to finish up the year and moving into 2023. But on the REBEL kits, we are striving for that active users to be at that approximately 1 kit per month on average, and that’s that 40% pull-through for those users. We have been seeing some pressures on that. Currently, we require closer to 0.5 kit per month versus 1 kit a month for those active users. And some of those are the employee turnover that we’re seeing within and need to train and retrain the project priority within our customer accounts needs to be clear to kind of drive them to cross the chasm per se on the new technology adoption and getting so it’s not the devices but also some on the consumable pull-through as well.

Operator: Our next question comes from the line of Puneet Souda from Leerink.

Puneet Souda: So this is a meaningful reduction in guidance this year. I mean, obviously, the questions are for 2023. I think, Kevin, the question that I have, it really is you have 80 or so folks in the commercial organization today, they were hired last year, they’re fully trained and productive right now. So you essentially have a strong sales force. You are seeing some slowdown in clinical trials. You were still early in this ramp. You have an innovative product that is highly differentiated versus the rest of the market in terms of the accuracy, the ease of use, all of those benefits are there. This is still very much a still process development in clinical trials. So it’s just sort of the challenging to see sort of why that slows down so meaningfully here?

And maybe can you talk to us about sort of what’s your line of sight there? When do you think this can sort of improve? What are you hearing from the customers on the REBEL side? And then I have a follow-up on 908 MX-908.