Microsaic Systems PLC (LON:MSYS) Chief Executive Officer Glenn Tracey caught up with DirectorsTalk for an exclusive interview to discuss their full year results for the year ended 31 December 2017
Q1: Glenn, you released full year results this morning, can you talk us through the highlights?
A1: So, I think the first point since I was become Chief Executive in September 2017, we’ve been very busy refocussing and effectively launching the business. We strengthened the Board with an addition of an experienced and successful businessman, Peter Grant and he’s the Non-Executive Chairman and we put into place a clear 5-year business strategy.
Another point is that we’ve got a capable and experienced management team working with me fully aligned and we’re working hard to deliver the strategy.
I’ll tell you Microsaic’s key strengths is that we’ve got a very strong IP portfolio and we’ve got very good experience of the commercialised footprint. What we’ve done is put in place a pragmatic R&D pipeline over the next 5 years and that’s targeted towards future market growth, both in small and large molecule detection.
One of the other points we raised is that our resources though are focussed on bringing to market technologies in high growth market particularly in biopharma and they’re in bioprocessing.
As I’ve mentioned to you before, we are very pleased to say that progress is being made with one of the foremost companies in scientific instrumentation in bioprocessing. and in December, we completed a technical feasibility stage, we took the project forward into the technical integration phase.
In terms of the financials, these are in line with expectation, as expected revenues were low as we refocussed the business on the new strategy, but we did reduce costs by £600,000 and we improved the bottom line results by about £500,000.
I would say that we are encouraged with progress in forming new potential partnerships and we think those will lead to modest growth in revenues particularly towards the second half of 2018.
Q2: So, how do you see the business growing in the short and longer term?
A2: Well, I think our approach is to form long-term collaboration with OEM partners where our products are integrated into their offering, by doing so we leverage their existing commercial position in getting to market. Now, it does take time to establish these partnerships and complete the integration but very much in the longer term, we’ll benefit from their in-depth end-user knowledge and their channel, if you like, with the end user.
In the short term, our technology is going to be integrated with a wide range of techniques, it’s probably worth mentioning some of those, particularly in terms of chromatography. That is preparative flash chromatography, liquid chromatography and also think layer chromatography but also in capillary electrophoresis and we’re particularly interested in online reaction monitoring. All those techniques are becoming increasingly popular to hyphenate with mass spec especially as target compounds are becoming more complex and by that, I mean targets such as peptides, small proteins, lipids and indeed a range of many other metabolites. This is going to be done through partnerships across many geographies; Europe, North America and Asia, and that’s both through OEM’s and also through value-added distributors who don’t currently don’t have mass spectrometry as part of their offering and want to partner with someone to offer seamless integration with mass spec.
Our longer-term goal is at line and on-line bioprocessing particularly in process development and then onto full scale biologic manufacture. Ultimately, our goal is to apply of mass spec expertise to point of need diagnostics but that’s something we can talk about on a later call.
Q3: Now, you talk about realigning the primary focus of the company on applications in the growing biopharma market, can you tell us how you intend to go about this and why?
A3: So, ultimately what Microsaic’s is going to be doing is to break our products seamlessly into a bioprocessing workflow, the biochemical analysis needs are very very different to what you would expect in a small molecule environment, small molecule production. Much more powerful analysis is needed in bioprocessing, but the trouble is that often means taking the sample to a centralised lab, now, talking to our end-users, we understand that this has created quite a few bottlenecks, those can range from days and we’ve been told even as much as 3 weeks, that causes some considerable delay in completing production runs and over the course of a year.
We believe our planned investment in property development is going to bring an unrivalled ease of use for the line operator and that coupled with powerful data, real-time and software analytics.
Q4: Microsaic has a strong IP portfolio, is this something that can be commercialised further?
A4: Yes, so we hold over 60 patents in our core technology and we’re making continued investments in ease of use hardware and software, increased mass range, sensitivity, data analytics as I’ve said, and this is going to have an appeal to really any current or future market partner.
It’s also worth noting we also have a concept triple quad and this is interesting really, not only to end users but to other instrumentation providers.
Q5: So, what does your strategy as a group look like for the next 12 months?
A5: We are going to be launching fully, what we call, the 4500 product this year so that means that we can not only measure small molecules but also metabolites, peptides and small proteins and this is important to us because it enables us to talk to many more, and wider set, of OEM’s. We do also have a very existing tool-less technology and development and we feel this is truly unique and we think it’s going to be revolutionary in product maintenance, it will reduce maintenance from typically hours down to minutes. However, our key focus, as I said, is really on bioprocessing and we are targeting to have that concept ready towards the end of 2018.
On the commercial side, we are encouraged by progress since taking on the position of having more OEM partnerships and I remain hopeful to see a proportion of these converting this year, particularly in the second half.
