Brian McKelligon - Chief Executive Officer Joe Driscoll - Chief Financial Officer Priyam Shah - Head of Investor Relations.

Thank you for standing by, and welcome to Akoya Biosciences' Fourth Quarter 2021 Earnings Conference Call. At this time all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's call is being recorded. [Operator Instructions].

I would now like to hand the call over to Priyam Shah, Head of Investor Relations. Please go ahead. .

Thank you, operator, and thank you to everyone who is joining us today on this call. I'm Priyam Shah, Head of Investor Relations at Akoya Biosciences. On the call today we have Brian McKelligon, Chief Executive Officer; and Joe Driscoll, Chief Financial Officer.

Earlier today Akoya released financial results for the fourth quarter ended December 31, 2021. A copy of the press release is available on the company's website.

Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements within the meaning of Federal Securities Laws, which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.

Any statements contained in this call that relate to expectations or predictions of future events, results or performance are forward-looking statements. Actual results may differ materially from those expressed or implied in the forward-looking statements due to a variety of factors.

For a list and description of the risks and uncertainties associated with Akoya's business, please refer to the Risk Factors section of our Form S-1 filed with the Securities and Exchange Commission on April 15, 2021.

We urge you to consider these factors and you should be aware that these statements should be considered estimates only and are not a guarantee of future performance. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, March 14, 2022.

Akoya disclaims any intention or obligation, except as required by law to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. And with that, I will turn the call over to Brian..

First, we will deliver new, robust, spatial biology solutions to the market that have the speed and the flexibility and the multiplexing capacity that our customers now demand.

Next, with this increased robustness, we will provide ongoing expansion of a readymade content, including multiomic capabilities with a range of solutions for RNA and spatial transcriptomics.

Finally, we will continue to partner with leading industry and academic medical centers to expand on our successes in the translational and clinical trial market, advancing our goal to establish Akoya’s platform as a robust clinical solutions.

Now one brief reminder, to better align our product naming conventions with these priorities, we recently completed some product rebranding.

The CODEX platform has been renamed the PhenoCycler and aptly so because the platform provides unbiased high parameter capabilities as an NC2 reagent delivery device, and cycling reagents on and off of the tissue, and it does so by physically integrating and pairing with our customers’ existing microscopes to create one integrated solution.

The Polaris platform has been rebranded as the PhenoImager HT, as it provides robust High Throughput imaging with the best optical technology in the market, and it was really purpose built to serve the translational clinical markets.

Historically, even though the PhenoCycler formally the CODEX was designed to integrate with our customers’ existing microscopes, the majority of customers were nonetheless buying a new third party microscope, to ensure that they had a dedicated system to run the CODEX assay.

And beginning in January, with the launch of the Fusion System, customers will now preferentially choose our Fusion over our conventional third party microscope. Capturing the microscope revenue with the PhenoCycler is an obvious and core driver for Akoya for this year.

The Fusion contains the same leading optical capabilities as the HT formally Polaris, but with a smaller footprint and was explicitly designed to integrate with the PhenoCycler.

Because of the powerful optics, a key benefit of the PhenoCycler, Fusion combination, is that our customers can now run high-plex CODEX experiments, nearly an order of magnitude faster, enabling larger, more meaningful studies and a contracted time to result.

This speed improvement accelerates time results, drives expanding pull through revenue per instrument. There is an equally powerful secondary benefit to coupling the Fusion with the PhenoCycler.

Our customers can use the PhenoCycler with the Fusion, for high-plex interrogation of tissues and then use the Fusion as a standalone to run high throughput validation studies at lower plex with a throughput of 100 samples per week.

This modular design and tunable workflow enables the flexibility of our customers to do biomarker discovery and biomarker validation on the same platform; it's effectively two solutions in one. We had limited shipments in Q4 and the full commercial launch of the PhenoCycler Fusion System commence on January 14 of this year.

We're encouraged with the initial customer interest and immediate commercial success, and look forward to providing updates on our successes throughout the course of the year. Now with this increase in speed and throughput that the PhenoCycler Fusion provides, we're also expanding both our content menu and our multiplexing scale.

Throughout 2022 and going forward you will see us launch expanded antibody content for fresh frozen, FFPE, human, mouse in areas such as cancer and inflammatory diseases and neurobiology. Now with faster speed and more content, we're also expanding the multiplexing of the CODEX assay from 50 markers to over 100.

We’ll share more details on this higher multiplexing level at the upcoming AACR Conference in April. Now our commitment to speed and throughput capacity improvements is ongoing.

We will release additional workflow and hardware improvements that continue to accelerate our PhenoCycler Fusion workflow, driving the throughput from 10 samples to 30 samples per week. We will also be introducing new assay methods to further accelerate biomarker discovery and validation.

The centerpiece is the launching of our new universal chemistry at the end of the year. This new assay is the best of breed between our current high-plex CODEX assay and our high throughput Opal assay.

This universal chemistry will not only simplify the workflow, but will also importantly enable cohesion and consistency of antibodies and assay methodologies from high-plex biomarker discovery studies to then more focused high throughput translational and clinical research programs.

So biomarkers discovered on the PhenoCycler and Fusion can then be validated on the Fusion alone and then advanced clinically to the HT to Polaris with the benefit of one consistent workflow and solution suite from Akoya.

This platform uniformity enabling both high plex discovery and high throughput validation on a consistent and cohesive platform from Akoya is an important driver of our commercial success. It allows us to own the biomarker journey from discovery to the clinic.

Now one final update on the PhenoCycler Fusion System and the reagents is our commitment to providing a suite of solutions for RNA analysis and spatial transcriptomics. I recall that the PhenoCycler again is an independent NC2 reagent delivery system, moving reagents on and off the tissue.

It physically pairs and integrates with both our Fusion or a third party microscope. This modularity provides Akoya with a distinct competitive advantage. We can develop and launch multiple assay and RNA solutions without requiring a new instrument or new instrument redesign.

We don’t have monolithic instrument where the hardware and assays are inextricably tied and fixed. It allows us to offer a suite or spatial transcriptomic solutions to meet a range of customer needs.

Our first product launch for RNA analysis comes out of our recently announced partnerships with Bio-Techne to automate their RNA scope chemistry one our PhenoCycler Fusion System. RNA scope is the industry's most widely adopted solution for spatial RNA, with over 4,500 publications and thousands of customers.

We expect to launch this middle of the year. RNA Scope on our system will be used primarily for targeted applications and validation studies in the lower plex range.

With simultaneously for upstream broad scale RNA discovery applications, we are also working on our own proprietary spatial transcriptomics technologies, which will enable up to 1000 plex of that capability. We expect to launch this proprietary spatial RNA solution in 2023 and will provide updates at the now rescheduled AGBT Conference in June.

So to summarize, our new product initiatives, we have a powerful new instrument in the Fusion that when paired with the PhenoCycler delivers unprecedented speed, capacity and application breadth. We will raise the multiplexing on the produce side to a 100 plus.

We’ll add additional validated content and provide workflow cohesion across our portfolio with our universal chemistry and also offer a range of RNA solutions.

Further, this new instrument solution, the PhenoCycler with Fusion allows our customers to run the Fusion as a standalone system for high throughput bio market validation, making the PhenoCycler Fusion the industry's fastest, most powerful single cell based spatial biology system.

So now as we look downstream to expand our opportunities and revenue in the translational and clinical markets, we have continued to invest in the PhenoImager HT platform, formally the Polaris. Invested to enable robust, clinical grade throughput and to meet the necessary ISO and quality system certification requirements.

In November of last year, our Advanced Biopharma Solutions Lab or ABS in Marlborough is where we performed lab services on the HT System, became clear certified, again this is last November.

This certification enables Akoya to support clinical trial enrollment studies, and will drive the continued acceleration of our clinical trial partnerships with key biopharma.

Now while we don't yet report ABS revenue separately, we are seeing a real expansion of our pipeline of opportunities and book projects and expect ABS to increasingly contribute to our top line growth and highlighting the growing adoption of the PhenoImager HT in clinical trials with both existing and new biopharma customers.

Our partnerships are central to our success in the translational market and in the clinical markets. We continue to leverage and advance our partnerships with thought leaders Johns Hopkins, at UCSF, AstraZeneca and many more.

In December we announced a new partnership with PathAI, to combine our advanced biopharma solutions service offering with their best-in-class AI powered pathology.

The combination of ABS with PathAI’s capabilities and expertise in digital pathology will help streamline biomarker discovery and validation, identifying patients with a high likelihood of responding to immune therapies. We expect this partnership to be a further growth driver of our ABS service business.

So to summarize, Akoya has delivered on our strategic and financial goals for 2021. Our new PhenoCycler Fusion system will be a core platform for customers enabling high plex, high throughput, multi-omic spatial analysis across whole tissues at high resolution.

Our growing reagent menu increased throughput’s speed and expanding installed base will drive pull-through and reagent revenue. With our clear certified ABS lab and clinical grade PhenoImager HT, we will continue to accelerate clinical and advancements with partnerships across leading academic centers and biopharmaceutical companies.

We are pleased with our strong financial performance in the fourth quarter and full year 2021 and will continue to expand on our leadership position in the spatial biology market as we move forward through 2022 and beyond. So with that, I'll turn the call over to Joe, to discuss our financial results. Joe. .

Thanks Brian. Hello everyone! As Brian highlighted, total revenue for the fourth quarter of 2021 with $16.2 million as compared to $12.9 million in the fourth quarter of 2020, which represents 26% growth. Product revenue which includes instruments, reagents and software was $12.9 million compared to $10.5 million in the prior year period.

Services and other revenue totaled $3.2 million as compared to $2.4 million in the prior year period. Within product revenue, instrument revenue was $8.5 million compared to $7.3 million in the prior year period.

Regent revenue was $4 million versus $2.8 million in the prior year period, which is the continuation of the growth we've experienced all year in reagents. We had another strong quarter with 46 total instruments sold, of which 21 were PhenoCycler and 25 were from the PhenoImager portfolio.

We are including the new Fusion instrument in addition to the legacy instruments under the previously labeled Phenoptics brand in this PhenoImager portfolio category. The total installed base of instruments is now 697 as of December 31, 2021, which includes 182 PhenoCyclers and 515 PhenoImagers.

Fourth quarter reagent revenue was on the higher end of our projected range and the performance gives us confidence in our recurring revenue becoming a core driver of our top line growth. Our annualized pull through on a year-to-date basis exceeds $30,000 per instrument for both the PhenoCyclers and the PhenoImager HT.

We have a wide range of usage among customers with our highest PhenoCycler users achieving annual pull through of $175,000, whereas the high volume PhenoImager HT users are consuming $200,000 per instrument. Gross profit was $10.2 million in the fourth quarter compared to $7.9 million in the prior year period.

This resulted in gross profit margin of 63.3%, an increase from the 61.3% in the prior year period. Increasing gross margin percentage is a key goal for the company as we continue to drive growth in our reagent business. Total operating expenses were $27 million as compared to $11.1 million in the prior year period.

Approximately $3.8 million of the OpEx was for non-cash items, including depreciation, amortization and other non-cash expenses.

In line with our strategic plan, the increase in OpEx was part of our investment in the business following our IPO as we hired aggressively in all areas of the business, including our commercial and R&D teams to continue to drive market share growth.

In 2022 we plan on making more targeted investments, so we project that OpEx will not grow at the same rate it did in 2021. We ended the year with $113.1 million of cash and cash equivalents as of December 31. This gives us several years of runway to continue to make key investments in the business.

Common shares outstanding are $37.3 million as of December 31, and fully diluted shares, including the impact of outstanding options and warrants totals $40.5 million. To summarize, our full year 2021 revenue was $54.9 million a 30% increase over 2020.

Included in that number is almost 70% growth in reagent revenue, which is a critical metric for our business. In addition, we sold 147 instruments in 2021 versus 118 in 2020. We remain confident in our ability to deliver strong growth in 2022 and are providing a full year 2022 preliminary guidance range of $69 million to $71 million.

Our base business has hit a stride of continued growth and furthermore, we expect contribution from multiple additional new revenue drivers we have highlighted on this call. Now, I'll turn it back over to Brian for closing remarks. .

Thank you, Joe. In summary, we're pleased to report a strong fourth quarter and a strong first fully fiscal year results as a publicly traded company. We are thankful for the hard work of our fellow dedicated Akoyans, as well as for the support of our customers and shareholders.

Akoya remains very well positioned for growth and we're excited about the opportunities that lie ahead as we deliver new spatial solutions from the discovery to the clinical markets. At this point, we will open the call up for questions, operator. .

[Operator Instructions]. Our first question comes from the line of Kyle Mikson of Canaccord Genuity. Your question please. .

Thanks. Hey guys! Thanks for taking the questions. Congrats on the quarter! I want to start on the Fusion platform first. So Fusion, PhenoCycler Fusion announced in mid-December, can you talk about what the excitement or the demand is so far from customers and maybe even like new prospects.

And then given most of your placements probably occur at the end of the quarter historically, could you just talk about, do you think there is any risk of freezing the market there a bit late in ’21 or early in ’22. Thanks. .

Yeah, so to take those maybe in reverse order. We didn't do a lot of forward announcements of the Fusion. We are working on it behind the scenes. So there wasn't, I don't think there was any real kind of freezing the market. We did reveal some details to selected customers under NDA. So no, I don't think there's any freezing impact.

Now in terms of qualitative, obviously we can't speak to the numbers yet and we will at the end of Q1. The feedback in the demand on the Fusion with the PhenoCycler has really been strong, extremely strong. It has resulted in new prospects, while there is an opportunity for existing customers to upgrade.

Most of the activity has been really new demand from new customers, and I think what we're hearing Kyle is the rationale behind our investments, behind what we are aiming for, leveraging the existing whole slide capability in an unbiased manner, now with speed, that's been a real driver.

And as alluded to during the call, there is another driver beyond just speed and plex. The modularity and the fact that this is our platform of future investment, I think is giving our customers the confidence that that the system is future proof. So it's not just the specifications of driving interest.

The modularity and the fact that this is our foundation for investment going forward, those are some of the key driver. So it really has been a strong Q1 in terms of demand creation. .

Okay. That was great. Thanks Brian. Maybe just turning to the financials. So obviously the reagents revenue was really strong during the quarter and this year obviously, so pull through was great. Could you talk with ASP though on the instrument side? It just seems like it’s kind of declining a bit.

I mean how should we think about that going forward in ‘22 and so forth and also what happened in the fourth quarter? Any kind of bundling things like that, just curious. .

Yeah, I'll let Joe speak to the details on the ASPs. I don't think we saw any ASP contraction, but Joe can confirm.

So Joe?.

Yeah. Our ASPs has been consistent all year. It's really just a question of mix of instruments sold. So there was a solid quarter of Cycler sales and that really drives your overall ASP if you're comparing it to prior quarters. But there is no inherent change in ASP’s in any one of our instrument types. .

Okay, got it. Thanks for the clarification. And then Joe, on OpEx, obviously you know pretty high during the quarter and you parsed out the stock based comp. I think almost $4 million or so, so that makes sense. I guess a couple of questions about that.

First, what is the way to think about OpEx going forward; and then there is a accounting adjustment during the quarter; a change in fair value of contingent consideration. Could you just talk about the – what that was related to, because it was a little bit higher than previously. It was like about 3x or 4x of what it was in the past. .

Sure. Yes, so OpEx in Q1 is going to be lower than what it was in Q4. Q4 had sort of these unusual items, a lot more non-cash expenses going through it, like stock comp and this contingent consideration item.

So it'll be lower in Q1, you know probably $24 million or so in total OpEx, of which $3 million would be non-cash things like depreciation, amortization and stock comp, but that's what I'm projecting for Q1. And then the contingent consideration item is an item that we – every year we have a revaluation done of a long term liability.

We have PerkinElmer, so we owe them a royalty over a 15 year period. It’s a long term liability. It gets revalued at fair value every year by an outside firm and so it's just a non-cash charge. You have to book it to the new fair value at the end of every year, so nothing really to worry about there..

Got it. Okay, it makes sense. And just….

Yeah, just qualitatively reiterating what Joe said during his section. So we were you know successful in the second half of adding you know a lot of great key talent to R&D into our commercial organizations. But as Joe noted during his section, as we get into 2022, it's going to be a lot more targeted in terms of our additional investments in OpEx. .

Okay, got it. It sounds appropriate. Just a quick one for you Brian. So the focus on Spatial Biology informatics among the constituents obviously, you know steadily increasing.

Can you just take a moment to remind us of the benefit of Proxima and the ecosystem that could create any enhancements you aim to make over time? And then of course you know that platform is what kind of competitive positioning versus other portals out there. .

Yeah, what we're trying to do is, is we're trying to make sure that we have a recognition that there's a lot of great inventions and investments that third parties can and will continue to make an analysis.

So as part of our effort to migrate or existing desktop informatics solutions to the cloud and layer it on as a collaboration system within Proxima, we are also really actively working with third parties through our API to allow those to plug in.

So just as we spoke about with PathAI, not directly in line with your question, as a partner to extract meaning, you know we will invest to build out our informatic platform, so that our customers have a go-to solution.

But really actively seek out partnerships where we can have, you know a real powerful third party solutions that can plug-in, because look, our aim is to get them to the answer as quickly as possible. So that is how we think about our informatics solutions and Proxima more generally. .

Got it. Alright, thanks Brian. Thanks for the questions guys. Congrats again..

Thanks Kyle..

Thanks..

Thank you. Our next question comes from Tejas Savant of Morgan Stanley. Please go ahead. .

Hey guys! Good evening.

So maybe Brian, just to follow up on that earlier question on the fusion here, can you just give us your latest thoughts on how many of those you expect to sell as standalone versus in conjunction with the CODEX, and any sort of quantitative color on the order funnel here and how that split might evolve with time?.

So yeah, I will refrain from anything quantitative at this point.

What was the first part of your question Tejas?.

Oh! Just curious as to how many were sold as standalone Fusions versus in conjunction with the CODEX?.

Yeah, so only – as we noted on the call, only a handful were shipped in Q4 and kind of what we're modeling going forward, you know as an attachment rate, you know maybe half the time or a little bit more. That is when somebody buys a PhenoCycler, then you know about half the time they are going to buy a Fusion.

You know in some cases labs have preferences of their third party microscopes and they standardize them and so that often times makes it easier for us to integrate with the third party, and we'll see how that tracks over time Tejas. You know it could be higher.

We’ve decided to come out with a fairly conservative number, and as we look back historically as I alluded, the percent of time that a customer was buying a third party microscope anyway prior to the Fusion was probably around 60% to 70%.

So we're leaving some room there given some potential institutional requirements for certain third party microscope types. .

Got it. That's helpful.

And then as you think about sort of book ends for the pull through here in Fusion Brian, I mean any sort of early sort of like signs on how that might be trending here as you know customers start to ramp here in January and February?.

There's no quantitative a real qualitative data yet. You know we just launched, January 13. Just starting to ship those, get those out, get those installed. So you know as of right now we'll start to see that data as it comes through, given the increased speed, increase plexing, you know driving more samples per week.

But with that increased plexing, you know more dollars per sample. So it's too early to have anything quantitative, because we're literally Tejas, just shipping and installing at this point. .

Got it, fair enough. And then Brian, as you progressed into March, I was curious in terms of just customer activity levels by type.

So you know in the academic customer base, did you see any sort of like slow start to the quarter that's ramping here through February and March? And also on the biopharma side, any kind of like slower sample intake during the pandemic that's now sort of essentially back to normal.

And Joe on a related note, are you essentially assuming full normalcy on a go-forward basis in your ‘22 outlook?.

Yes, so to take those in reverse order, right now we're seeing sort of business as usual, so no real hangover effects.

You know pockets here or there have some access or maybe an instrument or two, but nothing that's fundamental to our numbers in terms of access to the customer's ability to sell instruments and there's nothing atypical about this Q1 versus other Q1’s.

You usually always have a bit of a walking start in January, regardless of you know broader health or geo political things. But our quarter is progressing as we had expected, but again for the second part your question, we are not modeling any impacts of COVID anymore in our business.

We have the access and we think the customers have the access to our systems. .

Got it. Very helpful. Thank you..

Thanks Tejas. .

Thank you. Our next question comes from Julia Qin of JP Morgan. Please go ahead..

A very good afternoon. Just a follow-up in terms of your guidance for the full year.

Should we assume that you're expecting the same instrument mix between Cycler and Fusion and the rest of the integer portfolio as we saw enough 4Q? And then in terms of Fusion, since it’s you know at a different ASP, could you remind us of the price point and how to think about the image of portfolio ASP trends going forward. .

Yeah, let's take those in reverse order. The imaging portfolio going forward, you know we are end of life in you know two of those historical instruments within the Phenoptics portfolio over time, the Mantra and the Vectra. So the imaging portfolio is going to be the Fusion and the HT, formally the Polaris, that is the imagining portfolio.

With the Fusion as noted, being able to integrate with the PhenoCycler. Excluding the fusion Julia, and we can layer that in per Tejas’s question on attachment, it’s been fairly equivalent, you know maybe one or two more here or there over the prior quarters in terms of the number of HT’s and the number of PhenoCyclers we’ve sold.

That's likely going to continue going forward; there's some ebbs and flows as I noted. And then layering in the attachment of the Fusion to those PhenoCycler’s is really added revenue on top of us selling for example more PhenoCyclers in the prior year, so those are the dynamics. .

Got you. Very helpful. And then in terms of consumable pull through, it sounds like your current guidance has not invited a lot of meaningful contribution from the RNA menu extension and propriety regions yet.

But as we think about the long term potential, I think you previously set a path towards you know 50k to 60k pulls through on both platforms over time.

Is that already a benefit from the Fusion launched, to RNA menu and propriety reagent, or do those represent incremental upside?.

So, those the projections of the growing pulled, do include, RNA, new reagents, increased speed, increase plexing and dollars per sample. So our projections for driving pull through on a per instrument basis do include those assumptions. .

Got you, great. Thank you. .

Thanks Julia. .

Thank you. [Operator Instructions]. Our next question comes from a line of Dave Westenberg of Piper Sandler. Your question please. .

Hi! Thanks for taking the question and congrats on the good numbers here. So, great color on the upper limit customers of 200,000 in annual pull through.

Are you willing to give us a flavor of the customer types, you know in terms of what they might look like pharma, biotech, research and in terms of where they're at maybe the clinical research or any kind of profile that allows us to kind of think about, is this possible with the rest of your customer base?.

Yeah, so the upper limit customers on the HT side includes CROs and leading academic medical centers that have established ongoing programs, that's not surprising. So in the case of CRO, like we have through our advanced bio-farm solutions group, a number of established big pharma that are leveraging our platform.

In the case of the HT, Polaris and the leading academic Medical Center, these are groups that have established skilled translational program with routine sample flow. So those sorts of dynamics are the dynamics that I think are growing and our ABS growth is an indication of the forma.

On the higher numbers for the CODEX, not the PhenoCycler, there’s a number of different types of groups. There is groups that are building atlas type programs, where they are building out large reference data sets.

There's groups that are servicing, multiple other – as a core multiple other groups internally and as an aside leveraging speed going forward is certainly going to help our ability to place our instruments in these core labs because more samples, per unit time is how they run their business.

And there's other groups that are really digging deep and leveraging our platform to understand the basics of the disease. For example Bob Schreiber is one of those groups that’s using out of wash [ph], using our platform and mouse models to better understand response to immunotherapies.

So it's the kinds of things David I think that you would expect, but hopefully that gives you a little bit more color. .

No, it was very helpful, particularly on the CODEX side. So, it’s going to take me a little while to learn the rebranding, but I get it.

Alright, so I want to continue with one of Julia’s question about the pull through, and then that kind of long term assumption, because you are launching a pretty good amount of content this year and between the universe of chemistry the RNA stuff.

So I mean, like I intuitively think about that, but I think you're also adding on a microscope, should also add to what the customer can do. So can you talk about the pushes and pulls and the two year or three year trends in consumable pull through, that maybe make us think that maybe it's not that.

I mean maybe there's a maturity – or there is a you're getting more placements and you know there's a maturity cycle involved in those additional placement. I mean any color could help us out here. Thank you. .

Yeah, so I think when we talk about forthcoming RNA, speed improvements, increased in plexing additional content, that sort of flywheel of more samples per unit time and more dollars per sample. These are as you noted, these are solutions that are just getting into the market.

So those capabilities are not currently embedded, maybe speaking first in the discovery site in the existing PhenoCycler installs. So they will roll out over time and so we have, we have a maturation of the current customer base in the field to leverage these.

But also, incrementally as we add new PhenoCycler’s with Fusion over time, that will become a higher percentage of our installed base. So you might have a – and this may be an oversimplification, a bit of a biomodal user base between those are on the stand alone in the PhenoCycler versus those new customers that have it with the Fusion.

And so you might have, we might anticipate a higher pull through with those early and first PhenoCycler Fusion customers as compared to a standard PhenoCycler customer.

So those are some of the key drivers on a pull through per unit basis, but still an aggregate by the growing installed base, those new customers going to contribute more and more over time in terms of growing our total reagent revenue. .

Appreciate it! That's great color and then just a quick one, it's kind of an extension or the opposite of what Tejas asked, and that is, is there any standalone opportunity for the Fusion Microscope and I'm just talking about maybe some of those previous placement that didn't have a microscope that they acquired, a third party, and then they say you know what, this functionality is a lot better with the Fusion Microscope.

So any thoughts on standalone in that case and that wraps it up. Thanks. .

That’s a great question and you're calling out something that we probably could spend more time on. The Fusion really is an incredibly powerful microscope. As we noted, it’s got the same underlying image acquisition speed and capabilities as the Polaris, now the HT System but it's just in a smaller more affordable footprint.

So a Fusion standalone is really attracted to a segment of the translational and clinical research market segment that does, that don’t think they need the kind of scale and throughput that the HT System the forma Polaris provides.

So it has all of the same capabilities as the HT and the Polaris but again in a smaller footprint that’s more affordable. So that is an obvious customer, for the Fusion standalone. .

I appreciate it.

Good job on the quarter!.

Thanks Dave. .

Thank you. And ladies and gentlemen, that does conclude today's conference call. Thank you so much for participating. You may now disconnect..