SOPHiA GENETICS SA (NASDAQ:SOPH) Q4 2022 Earnings Call Transcript

Obviously, we hope that calms down, but other than that, that’s sort of the mix of it. And then biopharma, obviously, you’ll see impacting the ASPs in the way you will look at the model and so forth. And so, to the degree we do see upside there, that’s where it will come versus the pure analysis volume.

Jurgi Camblong: I would add, Mark, that, obviously, gross margins are very important because they reflect the sustainability of the business. And SOPHiA, which in English stands for wisdom, was not only there to bring sustainability in healthcare, making sure that data of patient today can be used to help this patient, but also leverage, so that we can further help the patients tomorrow. But in that context, of course, want to build as well an economical model that is sustainable for the long run. And in that sense, I want to highlight as well our current cash position and also December 31 2023, we were standing with $178.6 million in cash in bank.

Operator: The next question comes from Julia Qin with J.P. Morgan.

Marta Nazarovets: This is Marta Nazarovets on for Julia. Congrats on the quarter. I just had a quick question. So compared to 2022, what are your expectations for the customer base in terms of geography and then also in terms of clinical versus biopharma?

Jurgi Camblong: As you may remember, we are today in 70 countries. So we’re already global. We started in Europe, hence our presence being more dominant in Europe. But since then, we’ve been very nicely growing everywhere. And I think, today, we have demonstrated that our model was working in any country. I just mentioned some deals we announced recently with Synergy in Alabama, Mobile being one of the examples of reference labs that can work with us. I mentioned as well the University of Arkansas. This, I think, gives you a color on where we were trying to get more focused. So, definitely, we are growing everywhere. But we have been growing more quickly in average in Northern America. So we’ve been growing over corporate average in 2022. And this is a trend that we think should accelerate in the next few quarters and years.

Ross Muken: In terms of the mix of clinical and biopharma, obviously, we don’t separate as of yet, given just the nascent stage of biopharma. But as I stated to Tejas’ question, obviously, we’ve got very high degree of visibility in the clinical business. So you can see our growth expectations for the year and look back to what I said at the Analyst Day, and so I don’t think there’s any shift in our view of what clinical can deliver, I think, frankly, it could possibly accelerate from there. But that will take us to €“ continue to, I would say, improve execution in the US. On pharma, I’m super proud of the team. This was really a transformational year for us on the biopharma side. I’m very optimistic around what we will see in 2023 from that team.

But just remember, again, those tend to be longer sales cycles, just given the size of the business. And then, again, the burden might be a bit quicker, but still it takes some time to kind of contract and sign. And so, in terms of contribution, I would say, certainly, look toward the second half of the year in terms of the next level of inflection on the biopharma business. And then when it gets to size, where it makes sense from a disclosure perspective, we’ll start sharing that revenue for you, but today is not at that size where that would make sense.