STIFEL 2026 HEALTHCARE CONFERENCE - MAXCYTE INC

Financial Performance:

• MaxCyte reported strong Q3 results, with instrumentation revenue surging over 100% (even excluding a Genentech-related bolus) and consumables rising 20%.
• The company acquired Akron Bio for $150 million; Akron contributes $28 million in annual revenue and is EBITDA positive with 78% free cash flow conversion.
• Combined entity is projected to exceed $60 million in revenue next year.
• MaxCyte's cash burn is expected to drop below $10 million in 2027, down from $17 million in 2026 and $20 million at the start of the year, driven by revenue growth and cost synergies.
• Current gross margins are approximately 68% (combined), with a long-term target to reach high 70s as integration progresses and Akron's margins (60%) converge with MaxCyte's (80%).
• Cost synergies of $3–4 million are expected to be realized by the second half of next year, primarily through G&A and corporate function overlap.

Guidance and Future Outlook:

• Full-year guidance for 2026 targets 15% growth, with the second half expected to drive this acceleration.
• Akron Bio is projected to maintain its historical CAGR of approximately 13% next year, with potential for higher growth as commercial therapies ramp up.
• The company expects 2027 revenue growth, though specific numerical guidance for 2027 has not been provided.
• Industry funding for clinical cell therapy programs is viewed as stable, with $3.5 billion funded in 2025 compared to $3 billion in 2024, shifting focus toward later-stage, commercial-ready programs.
• Management anticipates continued growth in instrument placements and consumable revenue as inventory drawdowns conclude and commercial programs expand.

Business Segments and Product Lines:

• Acquisition Integration: The Akron Bio acquisition significantly broadens the portfolio into ex-vivo non-viral and viral reagents (cytokines, growth factors) for pre- and post-engineering cell therapy.
• Sales Synergies: Akron's U.S.-centric sales team (45–50 people) complements MaxCyte's robust global footprint in Europe and Asia Pacific, allowing for immediate cross-selling opportunities.
• Genentech Deal: A landmark non-SPL (Service Level Partnership) agreement represents a shift to an upfront capital model with a large pharma customer, validating the platform's clinical efficacy in Phase 1 trials.
• SPL Pipeline: The company maintains a healthy pipeline for Service Level Partnership deals, with late-stage negotiations ongoing for multiple new deals targeting a goal of 3–5 signings annually.
• Product Stability: The company notes that 90%+ of active commercial and late-stage clinical programs remain ex-vivo, while in-vivo remains largely pre-clinical.

Market and Competitive Landscape:

• The market is transitioning from program rationalization (culling) to stability and growth, with funding increasingly concentrated in later-stage assets.
• MaxCyte is positioning itself as a consolidator in the cell therapy reagent and electroporation space, leveraging scale to offer best-in-class products.
• The Genentech switch demonstrates the platform's ability to displace incumbent systems in clinical settings, potentially opening doors to similar "Pharma Model" contracts with other large biopharma firms.
• Revenue exposure to small biotechs is limited to less than 25% of the SPL portfolio and less than 30% of total revenue, reducing reliance on volatile early-stage financing.
• Akron Bio holds a differentiated position with stable, closed-liquid cytokine formats that do not require lyophilization, a unique feature in the reagent market.

Risks and Challenges:

• Integration Risk: While management views Akron's established leadership as a mitigator, merging two organizations carries standard integration challenges, though the plan is a "hand-in-glove" complement rather than a disruption.
• Program Culling: Historically, the loss of clinical programs impacted revenue; while management believes the "culling" phase has bottomed out, the risk of program termination remains inherent to biotech development.
• Cash Flow Dynamics: Although cash burn is improving, the transition to profitability and maintaining low burn requires sustained execution on both organic growth and synergies.
• Market Concentration: While diversified, the company remains dependent on the success of key large pharma and biotech customers, with the largest customer comprising ~27% of revenue.

Management Commentary and Tone:

• Management expressed high confidence in the Akron acquisition, describing it as a "best-in-class" add that provides necessary scale for a consolidator role.
• Tone regarding the operating environment shifted from caution to optimism, citing the end of inventory drawdowns and the stabilization of biotech funding as key tailwinds.
• Executives emphasized a "slow integration" approach for Akron, aiming to boost revenues rather than cut costs aggressively in the short term.
• Leadership highlighted the strategic pivot toward large pharma via the Genentech deal, viewing it as a replicable model for future enterprise contracts.

Analyst Questions and Answers:

• Q: What is the growth outlook for Akron Bio post-acquisition? A: Management expects Akron to grow at its historical CAGR of ~13% in 2027, accelerating as commercial programs mature and MaxCyte's global sales force expands its reach.
• Q: How does the Genentech deal differ from traditional SPLs? A: It utilizes an upfront capital model rather than a royalty model, which appeals to large pharma cash-rich environments and allows for broader "shots on goal" across multiple programs.
• Q: Will consumable revenue per instrument increase next year? A: Yes, management expects growth in consumables per box as inventory normalization completes and the funnel broadens.
• Q: What is the exposure to small biotech financing risks? A: Exposure is low, with less than 30% of revenue derived from small biotechs, and the majority of the portfolio consists of well-funded mid-to-large biotechs and large pharma.
• Q: What are the specific sources of the $3–4M cost savings? A: Savings will come primarily from G&A overlap, reducing redundant corporate functions and conference booth costs, rather than operational disruption.

Other Key Points:

• The Genentech agreement marks the fourth time MaxCyte has successfully displaced a competing system in a Phase 1 clinical trial, validating its clinical efficacy.
• Akron Bio possesses four registrational products in late-stage development, adding durability to the combined revenue stream.
• Management reiterated that the "rationalization" of the cell therapy sector appears to have bottomed, with expectations of more clinical programs entering the market in 2026.
• The company is actively building its commercial leadership team in the U.S., Europe, and Asia Pacific to support the expanded portfolio.