Pacific Biosciences of California, Inc. (PACB) Earnings Call Transcript & Summary

All right. Good afternoon, everybody. I'm Tycho Peterson in the Life Science Team. It's my pleasure to introduce our next company this afternoon, Pacific Biosciences last, but definitely not least. Just a quick reminder that you can submit questions directly through the website. And with that, let me turn it over to Christian.

Tycho, thank you, and thank you to the whole team at JPMorgan for giving us this opportunity today. And I'd also like to thank all of you that have tuned in for the last, but not least, presentation in the genomics space for the conference. But I'm Christian Henry, I'm the Chief Executive Officer, and I'm going to tell you a little bit about how we've been transforming PacBio. Specifically in today's presentation, I'll talk about some of the exciting new chemistry that we've been working on related to our Omniome acquisition. So I'll share some data for the first time. We'll talk about some of the collaborations that we've recently announced and entered into and their importance on the business going forward. And we'll also talk about our preliminary revenues for the fourth quarter and their implications going forward. But before we get started, I'd like to remind everyone of our safe harbor statement. You can look for the risks and uncertainties in our SEC filings, and of course, I'll be making some forward-looking statements today. So we intend to have this presentation protected. Thank you for that. So with that, PacBio is really focused on our mission of enabling the promise of genomics to better human health. We do this by creating some of the world's most advanced sequencing technologies. And I joined the company about 15 months ago and part of the reason why I joined is because I believe this technology can have a dramatic impact on the market and improving human health. Specifically, PacBio develops DNA sequencing instrumentation and consumables, and we have the leading technology in long-read sequencing today. We are also the only company with both long-read and highly accurate short-read technology. The short-read technology we acquired earlier this year in an acquisition of a company called Omniome. We have more than 50 products today that are spanning the entire genomics workflow. We have over 700 employees, so we're a truly global company. And the market that we address today is roughly $40 billion or more, and so we have ample opportunity. One of the hallmarks of PacBio Technology is that it is the most accurate and most complete technology on the market. And this isn't just the company saying this, this is evidenced by several papers that have been peer reviewed, everything from the Association of Biomolecular Resource Facilities, who go on to state in their paper published in September that PacBio HiFi technology provides the lowest error rate out of all sequencing technologies. And then if I can call your attention to the center of the screen, the precisionFDA group does comparisons of the sequencing technologies. And in their recent -- most recent set of studies, they demonstrated that the total errors by PacBio are 21-fold fewer than our competitors and 6.3-fold fewer than our sequencing by synthesis competitors. And so this is -- we're really proud of this achievement. We think accuracy and complete list matters when you're trying to resolve the biology of the genome. And this is evidenced if you look to the paper to the right by the telomere-to-telomere consortium. This group -- this announced earlier this year that they published the first complete human genome and this wouldn't have been possible without our advances in HiFi circular consensus sequencing. And so you can see that accuracy matters, and it enables us to get scientific results that are, in fact, unparalleled in the industry. The sequencing market itself is a multibillion-dollar opportunity. It spans multiple different market opportunities, and PacBio has products and offerings in all of these different markets. Our leading market today is human genomics, followed by plant and animal. We have an increasing business in microbial genomics with our recently launched SARS-CoV-2 surveillance kits. We have an emerging opportunity in oncology, and we see this as an incredible opportunity for us to grow over the next several years. And the entire size of the market today, we estimate -- in terms of actual revenues, we estimate to be about $5.8 billion. So if we take a look back together on 2021. 2021 was really focused on building the foundation for growth in the company, and we did that through 3 specific things: one, we were focused on expanding our commercial reach; two, we were focused on driving our product development pipeline to accelerate the ability for us to deliver new products to the market and finally, we also were focused on driving our market leadership in whole genome clinical sequencing through a number of different partnerships that I'll talk about in a moment. But to build a great company, you have to start with the leadership team, and one of the things we really focused on was expanding our leadership team to focus on driving growth. And if you look at this page, you can see these executives have more than 20 years of experience each, principally in the life science and also in the genomics space. I'd like to call your attention down to the lower right. Lara Toerien, we announced this morning, has joined the company as our new General Manager for Americas. I've worked with Lara for many, many years, and we're just thrilled to have her strong ability to lead, her customer focus and her deep industry experience on the team. We also -- as part of our significant commercial investment, we expanded in a global way. So we now have 6 global locations, whereas, at the beginning of the year, we only had 3. We have over 200 commercial employees today, 66 in the service and support staff quota-carrying reps. One of our key goals was to double our reps. We more than doubled our reps in 2021, and this truly enables us to reach more customers than ever and become a global company. As you can see, we're operating in more than 40 countries at this point. This commercial focus drove breakout performance in 2021. You can see we reported preliminary revenues of $130.5 million for 2021, which represented year-over-year growth of 65%. This was achieved in part through a dramatic increase in the number of Sequel II and IIe installs. We had an 84% increase in installs in 2021 versus 2020, and this drove the installed base to 374 units. We also have a very strong balance sheet with $1 billion in cash that allows us to drive all of our growth initiatives into the long future. If we dive into the performance of the Sequel II platform in '21 for a second, we can see, starting on the left, 84% growth in our installed base. But not only that, if you look into the center graph, the SMRT Cell shift grew by 220%. And for those of you that aren't familiar, the SMRT Cells are the consumables or the razor blades that go on to the instrumentation. And so not only are we placing more systems to enable SMRT Cells to and grow, but each customer is using their system more than ever because we continue to add incredible amounts of value to the Sequel II platform. All of this translates, if you look to the graph on the right, of a 250% growth in data generated, and this is an essential figure because more long-read sequencing coming into the market helps understand the biology and the power of long-read sequencing. In addition, our customers are developing new applications, which we can leverage into the community. But not only was the sales organization and commercial group operating in all cylinders, the rest of the company had the most productive year in our history. And it started in Q1 with our announcement of a groundbreaking collaboration with Invitae. We're developing an ultra-high throughput DNA sequencer. In the second quarter, we launched new enhancements to the Sequel IIe platform that drive 25% more data output and threefold lower DNA input. In the third quarter, we were extremely busy, and we announced the first 2 acquisitions in the company's history. Circulomics, a sample preparation company focused on DNA extraction; and Omniome, we believe to be the most accurate short-read sequencing technology that we've seen. And so we'll talk about that in a moment. And finally, in the fourth quarter, our HiFi viral surveillance kit. We have over 280 employees at this point dedicated to product development. If we dive into HiFi 5 viral, this product was conceived, and you can see I have the actual kit here. But the kit was conceived in the early part of Q1 as we really saw the pandemic continuing to move on and continuing to see that there was a need to be able to do surveillance and also do it without the need to constantly be updating the primers associated with the kits. This kit allows customers to sequence through all of the variants for the SARS-CoV-2 genomes. And we launched it in November and just since the middle of November, we've shipped over 16,000 samples to 20 global customers. And so this is an example of the success of the R&D team as well as a kit where we're really helping in the fight of the pandemic. As I said, our third area of focus is demonstrating the power of HiFi sequencing. And the way we're doing this is, we're very focused in the clinical applications of long-read sequencing in the clinic in rare and undiagnosed disease. And as you can see, we announced several collaborations during the year, all focused on understanding how long-read sequencing can help families with children, principally with rare undiagnosed disease. And so we're really excited about the progress we're making here, and we continue to push in this area, you'll see, in '22. So let's take a look at our strategic priorities for 2022. First, we're going to continue to focus on our execution. We're going to leverage the commercial investments we made to continue to drive HiFi and Sequel II adoption. We're also aggressively progressing our product pipeline, focused both on our long read and our short-read development. In the early part of the year, we'll start to show the progress associated with our sequencing by binding our short-read chemistry, which we've told investors in the community that we plan to launch our first products in the first half of 2023. We'll also continue to drive the development of our future HiFi platforms, and in fact, in the fourth quarter, we achieved some key development milestones that give us a lot of confidence that we'll be able to launch these new products in the near future. We're also going to continue to focus on deepening our collaborations, continuing to push the power of HiFi sequencing. But we'll start the year in the first half continuing to push to improve the Sequel IIe platform so that our customers continue to derive value from it. We'll launch new kits that will be focused on driving the DNA input requirements down, reducing hand time -- hands-on time and basically, simplifying the workflow so that as we get into high throughput applications, customers have a very seamless workflow. Secondly, we'll work on focusing on developing and delivering new software capabilities. And what I'm most excited about is our ability to directly call methylation on the instrument. Every sequencing run, once we launch this new software, we'll be able to call methylation directly without any additional sample prep without any additional informatics analysis, and so the Sequel IIe will truly become a 5-based sequencer. This is essential in oncology applications where methylation is a key biomarker that researchers are looking at. We're also going to continue to improve the SmartLink software so that high throughput workflows will be fundamentally enabled and new and emerging applications like gene editing QC will be enabled on our platform as well. We are really focused on driving the ecosystem, not just of the sequencer itself, but everyone around. And this will enable us to deliver more samples, more reads and more data. Specifically, we've announced a partnership and a relationship with Twist, where Twist is developing kits for the -- for our HiFi sequencing and the Sequel IIe platform. The road has been developing single-cell IsoSeq methods that will dramatically increase the number of reads available on every run, and this will allow researchers to look at complete isoforms looking at all the different splice variants in RNA. And finally, with Google, we announced a new partnership where they're helping us improve the accuracy, which will drive cost down, but the accuracy of our system, which is already industry leading, but the more we can improve that accuracy, the more we will drive down cost, increase throughput and help our customers resolve important biology. We also announced earlier this week a partnership with Genomics England, where we're running a pilot study. Genomics England is a world leader in translating genomics into health care and through their 100,000 genomes project, they ran short-read sequencing to try to diagnose rare and undiagnosed disease through short reads. But unfortunately, only 25% of what of the sequencing using short reads was able to uncover the causal variants. And so for the 75% of families that have unexplained variation or unexplained disease, we're going to do long-read sequencing in a pilot. If that pilot is successful, it will provide us with an opportunity to help even more families. We also announced earlier this week a new partnership with Berry Genomics, and this will be to develop a desktop HiFi-based long-read sequencing platform. One of our core strategies is to develop a multiproduct portfolio such that customers have platforms that fit their needs, whether their budget, their throughput or whatever requirements they're looking for. And with the Sequel IIe platform, we have the Sequel IIe platform, we're developing an ultra-high throughput platform with Invitae, and now we're going to be developing a desktop platform with Berry Genomics. This will make HiFi sequencing more accessible to new labs and also will allow us to have another instrument focused in the Chinese distributed market and get clinically approved by the NMPA. Ultimately, however, we will be able to commercialize the sequencer globally. So we're really excited about this partnership. Now I want to talk about the reasons behind why we acquired Omniome in the leading short-read technology. Today, HiFi sequencing has a growing and emerging opportunity, and as we continue to drive the throughput and cost of -- throughput up and the cost down, that HiFi opportunity is expanding dramatically. We also have an opportunity with the short-read sequencer to drive short-read sequencing into areas where long-read sequencing really isn't as effective and that's in oncology areas such as early detection, MRD, therapy selection. These areas aren't really addressed very well by long-reads today, and so the acquisition gives us the ability to capture more of that market and now start to really understand in the long -- very long run, how are these technologies going to play together, and we'll be able to drive into emerging applications whether it's the long-read technology or the short-read technology. At the end of the day, this gives our customers much more flexibility, and it gives us the ability to deliver the right solution to the market at the right time. But one of the things that we need to do in order to get the short-read sequencer to market is to develop new clustering methods, and we've talked about this. And we had a very, very productive fourth quarter, and I'm really excited to share. This is actual data of our new clustering method. And what's interesting is that the new clustering method not only will give us higher density and easier workflow, but in fact, it vastly improves the SBB performance, as you can see from this graph. You can see that our read links now. If you look at the chart through the cycles, we can get out to Q40 reads at 200 base pair read lengths. And in fact, most of the reads are over -- are approaching Q50, which would be 1 error in 100,000 observations. And so we're thrilled with this result, and this gives us a lot of confidence that we're going to be able to deliver a very high accuracy, easy-to-use workflow and powerful sequencer. One of the -- one of the hallmarks of SBB technology is that it's very consistent in its error profile across the entire reads. If you look at the blue line, you can see that we have mismatch error rates that are so low, it reaches the true variation level between the sample and the reference genome that you're looking for. This is in contrast to other short-read sequencing technologies that as the number of cycles go up, the mismatch error rate goes up dramatically. And although many of these SBS players are trying to improve their error -- mismatch error rates, the reality is that our error rates are so low that we're more than 15-fold better than what other SBS players can do today. And so we believe this accuracy matters, and it will particularly matter in oncology applications. What are the implications of that? Higher accuracy means fewer false positive base calls. SBB chemistry has more than twofold lower false positives than SBS chemistry. And in fact, the implication of that is that when you're looking for needles in a haystack in, for example, liquid biopsy or residual disease -- oncology residual disease, the deeper that you can look and the more sensitivity you have, you give the customer flexibility either, a, they can sequence less with less coverage and therefore, lower cost to get to the same allele frequency that they're looking for or they can sequence even deeper to find those needles that were previously undiscoverable. And we think this is the key aspect of the SBB chemistry that will enable us to build a very strong beachhead in these core oncology applications. In order to continue driving the development of the short-read sequencer, we have -- we announced an extension of our collaboration with Invitae, where Invitae will be looking at the system in various oncology applications, and we also announced a collaboration with Canexea Health. And as you can see from the diagram in the middle, this is our new design language for the instrument and so this is what the instrument is going to look like. We're thrilled about the progress that we've made here so far. So to really think about the company, we transformed the company in 2021 and we set the foundation for growth. And we are now the only company with both long and short-read sequencing technologies, and we have the premier long-read sequencing technology in the market today. We lead the industry in both accuracy and completeness, and these factors or these parameters are so critical to driving the future of medicine. And finally, we have multiple platform product development programs that are underway, which we think will draw long-term sustainable growth, value to our customers and really help us achieve our mission of enabling the promise of genomics to improve human health. And with that, I'd like to say thank you for your attention and Tycho, I'd love to introduce to you Mark Van Oene, our Chief Operating Officer, who will join me for Q&A, and we can go for the Q&A.

Perfect. Great presentation. I want to start off with the pre announcement and just get to that quickly, and then we'll get into the good stuff, but instrument placement numbers looked good. You were a little bit light overall in revenues, but curious, were there any kind of supply chain issues or anything in the numbers around consumables? Consumables looked like they were a little bit softer.

Yes, we did have some challenges in consumables. We had some customers burning through warranty reserves during the quarter. And as you know, Tycho, when you have a razor-razor blade model time, you can never get time back. And so we had some customers that had some warranty-related issues and therefore, they were running for a significant portion of the quarter using free reagents or warranty replacements. And therefore, that impacted the numbers some. We also had -- we do think that COVID impacted us a little bit, particularly in Asia. But on balance, the instrument number, we are really happy with. We see a lot of excitement around HiFi, and we finished the year very strong on the instrument side.

And I guess thinking ahead to '22, I mean, we'll get the full guidance with the quarter, but how are you thinking about COVID contributions this year?

Well, in this year being '21 or '22?

'22.

I do think that while Omicron is running around, I think our surveillance product is really a great product, and it enables our customers to not have to continually update their assay because our assay can work through all variants. We're seeing incredible traction in public health labs which we hadn't historically been involved in. We're seeing it on a global basis, and so I would expect our surveillance products to continue driving growth in the first half of the year. We'll see in the second half. But in the long run, I believe that surveillance is going to be a core opportunity for sequencing and for PacBio specifically, and so we're looking at evaluating different kinds of panels that not only in addition to the COVID surveillance because we think it's a long-term business opportunity.

And then thinking about some of the business development updates, you had with the pre-announcement, the Google collaboration. What do you think that ultimately can do on accuracy?

Mark, do you want to address the Google collaboration?

Yes. We're excited to work with them on this, Tycho. Traditionally, Google has been doing a lot of work on deep variant and looking at interpretation and sort of back-end processing. This time, we're having them focused really on our raw-based accuracy and something as small as a 2% increase in raw based accuracy with our traces can lead to about a 20% increase in yield. And so the goal here is really to get them inside the system and looking at raw bases that includes metal C. And so how do we think about raw-based accuracy, which is going to help reduce CCS coverage required increased yield overall and just drive the put and throughput of the performance of the system. So it's exciting, and it's a new area of focus for them with our long-read technologies.

Yes. Got it. And then the other update with Berry. Can you just touch on timelines for launching that instrument in China? And then how do you think about the opportunity for kind of the lower-end benchtop system outside of general?

Yes, I think -- first of all, I think the lower-end benchtop system has a tremendous opportunity in front of it. The system itself will be developed based on some core technology that will be used, not only in our desktop system, but also in our higher-end systems. And so therefore, we have the opportunity to make it a very powerful usable system, and it will allow us to penetrate markets not just in China, but quite frankly, globally. And so from a time line perspective, we're in -- we just signed the agreement with Berry, and so we're going to undergo a project plan to figure out the exact timing of when we want to launch the system, but in terms of our priorities, the high throughput systems have to be our top priority to get those out because those will drive us well below the $1,000 genome and really help us in our push of becoming -- of making long reads -- PacBio HiFi long reads the clinical standard in the long run here. And so we're going to focus on that first and then feather in the desktop system. One of the reasons why Berry is so intrigued about the desktop system is that they can run clinical panels and so there'll be much more panel focused on the desktop system, which will also -- the desktop will allow them to operate in a more distributed manner instead of centralized labs. So for us, that's a really big deal as we try to increase our footprint into China, but we'll give more details. I'm sure we'll give more details on the specifics of when we will launch the product over the course of the year.

Just to maybe add. It's important, Tycho, that as more people have been using HiFi and understanding the value of this for carrier screening for really hard-to-assemble gene saw in traditional germline genomics, I think it's important that we have not just a clinical whole genome approach, but a very targeted clinical approach for these panels. Also for IsoSeq as people start to understand more about isoforms and the value looking at RNA isoforms is be a great fit and to help to decentralize some of the HiFi viral for surveillance testing. So I think there's some real great application that this will be very well tailored for.

And it goes at the end of the day, Tycho, to what we've talked about over and over, building a multiproduct portfolio so that we have platforms at the very high-end platforms in the middle and platforms at the entry level and so that customers have a lot of flexibility so that we have opportunity to price the products appropriately in each segment. And so this is just fundamental to our strategy, and we're thrilled to be working with Berry on this.

All right. Let's talk about the elephant in the room. You had an interesting week. I think Illumina had its biggest one day move at our conference since 2012. You were down, I think, 15% of the news. So let's talk about Infinity. What's your take on it? Obviously, that came through an acquisition from Illumina, but maybe talk about how you think about the chemistry, the utility of 10,000 KB reads and just the competitive dynamic there.

Yes. So the first thing I want to make very, very clear is that they did not give all of the details, to my understanding, and we've all been doing a lot of homework to try to try to piece together exactly what this is. But it's our understanding what this really is, is short reads linked together through sample prep and software to try to emulate what a long read would -- "long read would be." In one of the presentations, one of my counterparts said 10 KB aren't long reads. So that fair enough. We can all draw our own conclusion. The challenge with this approach is that it's been tried several times and never really gained any traction. And so it will be interesting to see how well it does, but the applications are probably more in the bacteriology and some of those smaller genomes, but you lose a lot of -- you're still fragmenting the DNA and you're still losing information that you couldn't get. So for example, it's unlikely that this technology would perform well over tandem repeats or in some of the dark regions of the genome. It's unlikely that this technology will be able to call methyl c directly such as what we can do with native reads. And so there are some real limitations to what stitched short reads can do, but it demonstrates the fact that the competitors believe that long reads are important. And I do think that, that is quite exciting for us, given the fact that our long reads are the highest, the most accurate, the most complete. The telomere-to-telomere consortium wouldn't have been able to complete the genome without the first human genome without our HiFi sequencing. We've continued to improve our accuracy, improve our throughput, drive our cost down. And so when you look at it on balance about when the time will actually get the product to market, it's going to be cheaper to run on a PacBio system versus any competitive system, and you're going to get a complete genome with the highest accuracy. So from our perspective, it's an acknowledgment that long reads are critical to the future, and it's an acknowledgment that we're making very strong inroads in the community on what PacBio can do and what we're all about. And now it's up to us to focus on our execution so that we get these new products to market, drive the cost down. The last thing I'd say about their method, of course, is it's a much, much more cumbersome sample prep and it's going to require -- it seems as if it's going to require multiple steps that are reasonably complicated. Who knows what the DNA input requirements are going to be, and so we'll see and learn as the rest of the community. But from our perspective, we feel very confident in the technology that we have and that we're going to maintain being the leader in long-read sequencing, period, full stop.

And you're right. I mean, obviously, Illumina tried this before with molecular Avantome. You were there over those years. I mean, those involved huge cost, sample input and workflow, the reasons they didn't take off?

That's exactly -- yes.

Yes. And did you know this company Illumina acquired longest...

Not really. They emerged after I left the company. So we don't know. We've seen the papers, and we do have people internally that know the people. And so of course, we've consulted with them and had conversations and that helps bolster our confidence.

Okay. Chemistry X, that's the other one, right? One, to punch, so talk a little bit about what you know what your intelligence is around that? How much of the competitive threat that could be on the short-read side?

Well, I think, Mark, maybe you want to take this? Well, actually, why don't I start and then you can fill in. So Chemistry X, at least from their claims that they made during the presentation, seems to be it's going to be dramatically less accurate than sequencing by binding chemistry and that's really going to be the hallmark is that accuracy because it matters an incredible amount when you're doing deep counting applications. The accuracy of sequencing by binding makes it such that you don't have to use UMIs. You don't have to play a bunch of informatic tricks. You get the accuracy right out of the box and that will allow our customers to look at lower -- they'll able to either be able to look lower and deeper into the sample or look with less coverage and therefore cheaper. And I don't think Chemistry X is going to fundamentally change that. It's also interesting to think about does Chemistry X require new hardware? Is it going to be compatible across their entire fleet? Is -- and if it requires any new hardware, then quite frankly, it gives us an opportunity to get into each one of those customers when the time is right with our SBB and our highly accurate offerings. So...

And then if you had to guess, do you think it requires a new instrument, Chemistry X, or a new fleet of instruments or...

Yes. I wouldn't want to speculate. I think there's not enough information out there yet to confidently speculate. As you know, I've been sitting in one-on-ones all week. So I don't I don't think it's right for me to speculate. I just don't know.

One thing I would just add. I think it's -- I actually think it's great for the community, right? I think SBS, you've seen it over the last decade, the accuracy really hasn't been the focus. It's been dense -- the driving density and driving cost and really focus on output to get to those cost points, but it hasn't been accuracy. So I think the acknowledgment that accuracy does matter, and that's our thesis, right? Whether it's long or short reads, we truly believe that accuracy matters. And so I think the refocus on accuracy is going to be good for the scientific community and help resolve more of the biology that we're all trying to get towards. So I think it's good and to Christian's point, a threefold improvement is going to differentiate SBS from other SBS entrants into the market, but I still feel really good about our choice of the SBB chemistry to push forward with the market.

And how are you feeling about just competitive dynamics overall? I mean it's going to be busy at AGBT kind of back to sequencing, right? The last couple of years have been all about spatial. So it's little bit of a throwback, but how are you feeling about as you think about the Omniome launch next year, competitive dynamics on the short-read side, in particular?

I think the competitive dynamic and I think it's -- like Mark said, actually, it's great for the community. It's going to be fun because we all remember the days when this was front and center and there were a lot of entrants. It's going to push us all to continue to drive product innovation and development. Once again, we acquired Omniome because we believe SBB chemistry is highly differentiated against all of these players and that differentiation will allow us to go into applications that we think are extremely important and are going to grow really fast and give us the ability to get a beachhead and grow our revenue. Our objective right now is to get to $1 billion of revenue and grow from there. And I do think the short read -- having the short-lead chemistry in our portfolio allows us to offer customers the right solution. And so when we go to AGBT, we're going to be talking long reads and short reads and talking about what questions are you trying to solve Mr. Customer or Miss customer? And that's a very different conversation than saying, "Hey, I have this technology, please buy it." And so I think it's going to be interesting to see how these companies emerge, but we have a global footprint. We have a differentiated technology, both on long-read and short-read side, and therefore, we're very well positioned versus any of the emerging companies. And against the most significant company, we have a mousetrap that's highly differentiated, which allows us to do things that they can't.

Will you show Omniome data at AGBT internal data or...

It's likely that we would, yes. I think that's -- when you think about the rollout of Omniome in 2022 with a first half launch coming in '23, we have to be showing internally generated data, peer-reviewed data and then we have to be showing -- demonstrating early access performance with customers. That's why signing these collaborations early really helps because we are already sequencing with the new clustering chemistry. You saw the data in my talk. The new clustering chemistry is phenomenal. It's way ahead of our schedule, and it's very -- it will allow us to achieve density. It's more accurate. It's -- the workflow is easier. And so I couldn't be more pleased with how fast that came together and now it's a question of integrating the rest of the system, getting it into early access, getting it through the beta period and then gearing up for a big launch.

Maybe in the last minute here, just a question on HiFi. Obviously, that's been doing well. What percentage of your consumable pull-through today is HiFi? And what percentage of your Sequel IIe customers are utilizing HiFi reads?

It's almost all HiFi. I mean a vast majority. I don't know the exact percentage between HiFi and old school CCS, but it's almost all HiFi these days, particularly in the human germline genomics applications, which, as you know, we've got a real push in '21 to start really driving that revenue because there are so many samples and so much opportunity there. And so we're seeing HiFi as the predominant -- once again, it's the accuracy and completeness that drives customers to our technology.

Great. Well, we're at time. So I think we're going to leave it at that. Great presentation. Look forward to talking to you in couple weeks in earnings and hopefully see you in person at AGBT.

Yes. Thanks, Tycho. We really appreciate it, and thank you, everyone, for your attention today. Thanks, Mark, for joining me up here on stage, too. Cheers.