I think Larry Smith read your post “Most if not all analysts have called for 20 million” and decided to raise his projections!
I thought this would be a year of solid growth with revenues ramping toward the end of the year with BP outsourcing, and a number of new approvals to increase the ramp into 2019, but my expectations have been lowered considerably. A year ago, I invested more heavily into CYRX than BLFS because I think it has greater upside potential. At this point though, the potential may be a little further out, and it’s always been more difficult to quantify Cryoport’s software angle with the information management provides. I believe even at the current price, CYRX is still trading at a premium due to the take-out possibility, and new institutional support. I expected a drop after the Q2 earnings report and think we may drift a bit further by the end of the quarter window dressing unless some good news occurs.
I think this question from Sean Hannan with Needham gets to the heart of the issue . . . when are the damn revenues you promised us finally coming?
Sean Hannan
. . . can you give us an update here that might be a little more specific in terms of how you are modifying your expectations of timeline, say, for Gilead or Novartis with those specific therapies to hit those targeted $8 million to $10 million in revenues . . .?
Jerrell Shelton
Yeah. Sean, I'm going to make a few comments and I'm going to turn it over to Mark Sawicki to give you a more detailed answer to your questions. But I'm going to start off saying first of all, we are dealing with revolutionary therapies. These therapies had never before been done and these companies are taking great care to make sure that those points of care are qualified and that the inoculation takes place and that the therapies are exactly right. They don't want any setbacks. They don't want any problems and they are being very responsible. So we are highly respective of that. Is the ramp a little bit off where we expected? Yes, it is, but that's to be expected. This is biology that we are working with and it's data-driven and data is being collected and care is being taken and a responsible approach is being taken as well. So with that, I'll turn it to Mark for more finite answer.
Mark Sawicki
Thanks, Jerry. So as we take a look at this and we look at the activity ongoing within our two commercial clients, they continue to take a very, very aggressive stance in the marketplace and I think publicly they disclosed enhanced manufacturing competencies. Jerry talked about the Kite facility in Amsterdam and Novartis has announced additional manufacturing capacity coming online in Europe as well. Very aggressive expansion plans, both of them have publicly acknowledged their launch profiles in Europe. And so I don't think that we are going to see a material difference in that ramp. It's just going to - I would still feel very confident that that top line in is an appropriate number. It's just - as these things come online, we are going to see that ramp just aggressively modify maybe geographically more so than anything on a significant delay or anything along those lines, so.
(So enough dancing around guys . . . how long will we have to wait? )
Sean Hannan
Okay. Well, let me ask totally different way because I just feel I need a little bit more information, because we are a few quarters into the experience and I think yes, it's a new one and it's a new process for everybody . . . So at this point are we talking about the ability that we should be able to get into the range in concept in year 2020 or 2021 or is it possible that's a little further out than that?
Jerrell Shelton
Yeah, I think that, first of all, there is a lot of data available on both the Kite and the Gilead Kite website and through their calls, as well as through Novartis. As for our planning, we feel that our planning is on target. We didn't build facilities for them to be vacant or hire people for them to be idle and there is some orchestration to take place and there is load to place on these facilities and ramp up times and so forth as I mentioned earlier. But we feel that we are on schedule and we are coordinated with the manufactures and we talk - we have dedicated program managers and we have fluid conversation lines going all of the time. So we feel confident that we are on the right pathway and we made the right decisions in terms of building out our capacity and our planning. Mark, would you like to add anything to that?
Mark Sawicki
No, I think that's accurate. Well, we can't provide specific guidance on what the ramp schedules look like, because its proprietary in nature. What Jerry had mentioned is true. I mean we are working very, very closely with both parties ensuring that we have the right assets in place at the right time and we haven't gone through an aggressive build out of two new facilities with the expectation that that volume is distant in timeframe.
And they still didn't even answer the question.
