AbCellera Biologics Inc. Q1 FY2026 earnings call

Pipeline Progress & Clinical Highlights

• Lead program ABCL635, a first-in-class NK3R antagonist antibody for non-hormonal treatment of moderate-severe vasomotor symptoms (VMS, hot flashes) from menopause, advanced to Phase II testing in January 2026 based on positive interim Phase I data. Top line Phase II results are expected in Q3 2026.
• Unblinded interim Phase I single ascending dose (SAD) data for ABCL635 demonstrated: generally well-tolerated safety profile with no serious, severe, or discontinuing adverse events, and no liver toxicity (a key differentiator from approved small molecule NK3R antagonists); linear, dose-proportional pharmacokinetics with a 24-day half-life that supports monthly dosing; strong, sustained target engagement in the hypothalamus, with 50% to 75% sustained testosterone suppression for multiple weeks, exceeding the transient suppression seen with the approved small molecule Fezolinatant.
• The ongoing Phase II ABCL635 study is a randomized, double-blind, placebo-controlled trial enrolling ~80 patients, dosed with a single 600mg loading dose, with primary endpoint readout at 4 weeks. The trial is enrolling on track, and an open-label extension is available after the 12-week controlled period.

Corporate & Pipeline Strategy

• The 2026 key priorities are: deliver top line data readouts for ABCL635 and ABCL575; advance ABCL688 and ABCL386 through IND-enabling activities; add at least one new development candidate to the pipeline.
• ABCL575, a potential best-in-class OX40 ligand antagonist, is on track for a top line Phase I readout in Q4 2026. The company plans to partner ABCL575 after Phase I completion and will not develop it internally past Phase I.
• The company targets up to three additional clinical-stage programs by the end of 2027, including undisclosed programs ABCL688 and ABCL386, both targeting large market opportunities. The company expects to select its fifth internal development candidate in the first half of 2026, and remains on track to hit this goal.
• The company believes ABCL635 has a large total addressable U.S. market of at least $6 billion annually for non-hormonal VMS, with upside potential from expanding to VMS caused by cancer treatment-induced hormone reduction (in breast, ovarian, and prostate cancers). ABCL635 is differentiated by its once-monthly subcutaneous dosing, lack of required liver enzyme monitoring, and differentiated safety profile.

Abcelera is a clinical-stage biotech with a single operating segment focused on internal pipeline development. Q1 2026 total revenue was $8 million, all from research fees, which is double the $4 million revenue in Q1 2025. Research and development (R&D) expenses were $47 million, a $4 million increase year-over-year, reflecting increased investment in internal pipeline programs. Selling, general, and administrative (SG&A) expenses were $12 million, a $7 million (35%) decrease year-over-year, driven by the conclusion of intellectual property litigation and organizational adjustments after shifting focus to internal pipeline. The company reported a net loss of $43 million for Q1 2026, compared to a $46 million net loss in Q1 2025. Net loss per basic and diluted share was 14 cents. Operating activities used $34 million in cash in the quarter, consistent with the 2025 completion of large facility and manufacturing investments. Ending Q1 2026, the company held $531 million in cash, cash equivalents, and marketable securities, plus an additional $125 million in available committed government funding not reflected on the balance sheet, for total available liquidity of approximately $655 million.

• Top line Phase II efficacy and safety data for ABCL635 remains on track for release in Q3 2026, with additional data to be presented at medical conferences after the release.
• Top line Phase I readout for ABCL575 is expected in Q4 2026.
• The company remains on track to select its fifth internal development candidate in the first half of 2026.
• The company expects to have up to three additional clinical-stage programs by the end of 2027, with ABCL688 and ABCL386 entering Phase 1-2 clinical trials.
• Management confirms existing guidance that the company has sufficient liquidity to fund at least three years of planned pipeline investments. No upward or downward revisions to prior financial or operational guidance were announced.

• Forward-looking statements about pipeline progress, future efficacy, and clinical timelines are subject to inherent risks that could cause actual results to differ materially from expectations, as detailed in the company's SEC filings.
• While the SAD Phase I data for ABCL635 is positive, there is remaining scientific uncertainty: the correlation between testosterone suppression (a biomarker of target engagement) and clinical efficacy in VMS, established for small molecules, may not directly translate to an antibody. Target engagement in the preoptic nucleus, another relevant brain region for VMS, has not been directly measured.
• The 600mg Phase II dose selection, while supported by existing data, will require Phase II readout to confirm efficacy durability over the 4-week primary endpoint window.
• The observed higher rate of mild headaches in the 900mg SAD cohort may be a safety signal or an artifact of small cohort size, and this uncertainty remains until larger trials generate more data.
• The company's research fee revenue is expected to trend lower over time as it shifts focus to internal pipeline development.

Q: Given the strong, sustained testosterone suppression achieved by ABCL635, does management believe the approved small molecule NK3R antagonists leave efficacy on the table, and could ABCL635 deliver better efficacy in the upcoming Phase II VMS data? Also, will sufficient dose optimization data be available to move directly to Phase III in 2027 after the Phase II readout? / A: Testosterone suppression directly measures target engagement but is not a direct marker of ultimate VMS efficacy; efficacy results will not be known until the Q3 Phase II readout. Management's base bar for success is achieving comparable efficacy to small molecules, with the already demonstrated advantages of a cleaner liver safety profile (no required monitoring) and more convenient once-monthly dosing. The Phase II study collects 12 weeks of data to build a robust PKPD model, which will provide sufficient data to engage regulators on a late-stage development path. Regulators may request an additional dose test, but management does not expect this will be required based on current data.

Q: What is the rationale for selecting a 600mg single loading dose in Phase II, and is there risk that 600mg will not maintain sufficient testosterone suppression through the 4-week primary endpoint? Also, why did the 600mg cohort have a lower adverse event rate than the 900mg cohort? / A: The 600mg loading dose approximates the 300mg steady-state exposure expected for chronic monthly maintenance dosing, and 300mg monthly fits in a commercially available autoinjector. PK and PD data confirm robust 600mg testosterone suppression through the full 4-week window, so management is confident efficacy can be evaluated at this timepoint. The lower adverse event rate at 600mg is most likely due to small cohort sizes; the mild headaches seen in the 900mg cohort could be a real signal or caused by study-related factors, but the 600mg safety profile is clearly reassuring.

Q: Why was the multiple ascending dose (MAD) Phase I trial capped at 600mg, and will the MAD data be released before the Q3 Phase II readout? / A: The 600mg top dose was selected because it provides exposures well above what the company expects to need for commercial viability, to establish a sufficient safety margin. The cap was not due to any safety signal, as no dose-limiting toxicity was observed in the Phase I trial. The MAD trial is still ongoing, with final follow-up visits pending, and remains blinded. Management does not plan to unblind or release MAD data before the Q3 Phase II efficacy readout.

Q: Is the ultimate goal to maintain stable testosterone suppression over the full monthly dosing period, and is there optionality to extend the dosing interval beyond 4 weeks? When will ABCL688 and ABCL386 enter the clinic, and which will start first? / A: The goal is prolonged, stable target engagement over the planned dosing period. Current data supports a 4-week (monthly) interval, but the Phase II study follows patients for 12 weeks after the single dose, so data will be available to evaluate if efficacy persists longer, which could support a longer dosing interval. Both ABCL688 and ABCL386 are advancing well through IND-enabling activities, but management is not yet ready to announce which will enter the clinic first, and will provide an update as progress continues.