Cryoport, Inc. is a leading global provider of innovative products and services supporting the life sciences industry. The company's mission is to enable the future of medicine for a new era of life sciences. With over 50 strategic locations covering the Americas, EMEA (Europe, the Middle East and Africa) and APAC (Asia Pacific), Cryoport's global platform provides mission-critical bio-logistics, bio-storage, bio-processing, and cryogenic systems to over 3,000 customers worldwide.

Business Overview

Cryoport's advanced temperature-controlled supply chain platform is designed to support the global distribution of high-value commercial biologic and cell-based products and therapies regulated by the United States Food and Drug Administration (FDA), the European Medicines Association (EMA) and other international regulatory bodies. The company's solutions are also relied upon for the support of pre-clinical, clinical trials, Investigational New Drug Applications (IND), Biologics License Applications (BLA), and New Drug Applications (NDA) with the FDA, as well as global clinical trials initiated in other geographies, where strict regulatory compliance and quality assurance is mandated.

Over the last several years, Cryoport has grown to become a leader in supporting the clinical trials and commercial launches of cell and gene therapies globally. As of March 31, 2024, the company supported 675 clinical trials, of which 77 were in Phase 3, and 14 commercial therapies. The company believes regenerative medicine advanced therapies that successfully advance through the clinical trial process and receive commercial approval from the respective regulatory agencies will represent opportunities to become significant revenue drivers as the majority of them will require comprehensive temperature-controlled supply chain support and other services at commercial scale.

Financials

For the full year 2023, Cryoport reported annual revenue of $233,255,000 and a net loss of $99,587,000. The company's annual operating cash flow was -$757,000 and annual free cash flow was -$45,657,000.

In the first quarter of 2024, Cryoport reported total revenue of $54,592,000, a 13.1% decrease compared to the same period in 2023. This decrease was primarily driven by a 34.0% decline in Life Sciences Products revenue, which was partially offset by a 2.7% increase in Life Sciences Services revenue. The decline in Life Sciences Products revenue was attributed to decreased demand for cryogenic freezer systems, particularly in China.

Gross margin for the first quarter of 2024 was 39.9% of total revenue, compared to 43.1% in the same period in 2023. The decrease in gross margin was primarily due to the revenue mix shift towards lower-margin Life Sciences Services revenue.

Selling, general and administrative (SG&A) expenses increased by 15.2% in the first quarter of 2024 compared to the same period in 2023, driven by continued investments in the company's competencies and infrastructure to support the scaling of its business and demand for Cryoport's systems and solutions.

Engineering and development expenses increased by 22.6% in the first quarter of 2024 compared to the same period in 2023, as the company continued to invest in improving and expanding the features of its Cryoport Express®, Cryoport ELITE™ Solutions and portfolio of temperature-controlled services and products.

For the first quarter of 2024, Cryoport reported a net loss of $18,895,000, compared to a net loss of $5,574,000 in the same period in 2023. The company's operating cash flow was -$3,265,000 and free cash flow was -$3,708,000 in the first quarter of 2024.

Outlook

Despite the challenging first quarter, Cryoport maintained its full-year 2024 revenue guidance of $242 million to $252 million. The company expects its total revenue to progressively improve throughout the year, driven by continued momentum in its Life Sciences Services segment, including growth in commercial therapies and BioStorage/BioServices revenue.

Cryoport's Life Sciences Services revenue, which includes BioLogistics Solutions and BioStorage/BioServices, increased by 2.7% year-over-year in the first quarter of 2024. The company's commercial therapies revenue grew by 9.1% year-over-year, and BioStorage/BioServices revenue increased by 9.2% year-over-year during the same period.

Geographically, Cryoport's revenue is generated across the Americas, EMEA, and APAC regions. In the first quarter of 2024, the Americas accounted for 54.8% of total revenue, EMEA accounted for 28.6%, and APAC accounted for 16.6%. The company's international business, which accounted for 45.2% of consolidated revenue in the first quarter of 2024, decreased by less than 0.1% year-over-year due to fluctuations in foreign exchange rates.

Recent Developments

To address the current macroeconomic challenges and their impact on the company's financial results, Cryoport is implementing a number of initiatives to drive towards positive adjusted EBITDA and cash flow in the near term. These include improved alignment of the global organization, reduction in the workforce, leveraging lower-cost shared services, refining and reprioritizing planned initiatives, and delays in capital spending as a result of reprioritization.

Liquidity

Cryoport ended the first quarter of 2024 with a strong balance sheet, including $49.7 million in cash and cash equivalents and $398.9 million in short-term investments. The company's management believes that the current cash and cash equivalents on hand, short-term investments, together with projected cash flows, will satisfy its operational and capital requirements for at least the next twelve months.

Conclusion

In summary, Cryoport is a leading global provider of innovative supply chain solutions for the life sciences industry, with a focus on enabling the future of medicine through its advanced temperature-controlled packaging, informatics, specialized bio-logistics services, bio-storage, bioservices, and cryogenic systems. Despite the challenging macroeconomic environment, the company remains well-positioned to capitalize on the growth of the life sciences and cell and gene therapy markets, as it continues to execute on its strategic priorities and implement cost-saving initiatives to drive towards positive adjusted EBITDA and cash flow.