Cryoport (CYRX) 8 May 222022 Q1 Earnings call transcript

Company Profile

Participants

Todd Fromer	President, KCSA Strategic Communications
Jerrell Shelton	CEO
Robert Stefanovich	CFO
Mark Sawicki	CSO
John Sourbeer	UBS
Brandon Couillard	Jefferies
Michael Jones	SVB Securities
Joseph Conway	Needham & Co.
Paul Knight	KeyBanc
David Larsen	BTIG
Yuan Zhi	B. Riley Securities
Jacob Johnson	Stephens

Call transcript

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Operator

Thank you for standing by. This is the conference operator. Welcome to the Cryoport Inc.

First Quarter 2022 Earnings Call.

As a reminder, all participants are in listen-only and the conference is being recorded. will opportunity there ask presentation, the be to an questions. After to I KCSA. conference would Instructions] turn now with [Operator Fromer like the Todd over to go Please ahead.

Todd Fromer

you, Thank operator.

assumptions this like Before are statements management All forward-looking not the currently statements expect our and or forward-looking remind I or begin events address contains are would statements. available performance, management’s that we everyone forward-looking These today, that beliefs that information based future developments our conference operating statements. anticipate call certain in and to on on to we occurring team.

these Our management team statements as believes that and when forward-looking made. reasonable are

undertake However, not update or obligation any should as otherwise, such speak or to forward-looking on any revise only required a or as events statements, information forward-looking except not statements, law. of new the you as made. result by any undue such future when of statements place publicly because date whether reliance do We

uncertainties my the report those the of Cryoport. with certain Risk present expectations in In addition, materially in limited but our not Securities on and described to Securities other yours. Executive Jerrell floor Officer historical Form and the which XX-K It is Shelton, turn to we file Mr. and and forward-looking These and now to experience developments filed annual Exchange from is the Commission pleasure events XA, elsewhere with from Jerry, described statements cause call the Chief Commission. reports, time-to-time to to, over are in Exchange our differ or Item are risks results, and those Factors actual and that and include, uncertainties risks subject our projections. could

Jerrell Shelton

earnings our of Investor afternoon, With you joining Scientific Todd. President call Heinzen. Stefanovich; Officer, this Relations, Financial Mark Robert is Officer, Corporate ladies appreciate afternoon Chief our Development We and Vice Thomas and gentlemen. Good Chief our today. Dr. Sawicki; you, Mr. us Thank our and

review document section. and financial performance in website. can quarter of have Presentations our recent review It and Investor we a As a document uploaded be general This to found provides first operational XXXX the and business outlook. reminder, Relations Events and our under our the

not have encourage a answering will the business update into read download on to to and website provide would it, you and I go then I it. a you If to your had brief chance the questions. move

Our first solid. quarter was

New throughout demand growth continues reflected partially systems financial Our our to quarter, $X.X of to and we intend backlog The of offset full capacity strong. to the performance at the very be first the manufacturing approximately plant fire the and XXXX. the impact and continued isolated from recapture We plant cryogenic equipment and adverse was at the now revenue million. our remainder results by is impact of Prague, that operating strong the is fire the Minnesota at believe and

XXXX as services fruition. And by increase the new market. of vision Paris. Clermont-Ferrand, our located we biopharma. launch of into one manufacturing that validated a other Global plant Global in These of global expansions. expanded we growing Plains, complemented as becoming at One, of expand the Cryoport meet our expansion During position XXXX, to continues our comprehensive XX from Centers we strong. both of serving total systems Supply XXX is such to Chain our the supporting X, as the San record potential Cell&Co, systems incrementally the making Supply increase XXXX. worth And are the the first of Houston, be choice trials capacities, strengthening quarter, freezer. and which to is from industry and Texas; a Demand new XX our and by further consulting business and Chain is will XX% supported choice It expansions will network continue in reaching a time of at capacities across courier products will To quarter Three, first industry medicines of Network, model is we of first be the Antonio following fully services, the new these the last products fusion next our few to Houston -- the of and same noting These multiple new will as Phase chain we'll number be are to sciences platform will biostorage augmented acquisition openings up The our continue and very medicine with world-class cryogenic introduction Chain compelling other for especially the expanding Center but well be New partner grand all an higher beginning concept and and and services will two most grow we and have supply Philadelphia. trials XX% clinical are cryogenic our pipeline trials Morris month, which in the commercial footprint. to from Centers, our of to the company the provider quarter France to for these for over of a Cryosphere four, equipment the in now markets of coming in continue and of Two, our Global through our year. acquisitions initiatives, in than life return units Through of are Jersey. record first demand, cryogenic customers quarter a regenerative Supply end be with expanding examples. services, across the

revenue represents today. XXXX are of year million. that that And while systems $XXX in global growth continue and for diverse services. to demand we our global business challenges guidance conditions, is demand in markets reflected Through $XXX we strong and is And April for of XX% facing and not immune see Our to solid current reflection are totally the expected many provided share is be we seen to shares repurchase to million revenue macro products, and have This full the our in million $XX business outlook in repurchased confidence approximately remain could by XX% our XXth, we by Board Directors. driven $XXX market. authorized guidance our of units. across -- in business Further program of million our the our

capital opportunities $XXX and strategy the Our partnerships. strong cash financial the current most to executing strong markets, growing growth compelling growth, record our life well of approximately support organic provider to our through the and in remains with see of continue serving We are Despite market track building share future. business. foreseeable industry comprehensive positioned position the gains sciences chain acquisitions and our continue we in turmoil the supply to million for

happy Now, entertain questions. be we'll your to

So, operator, please lines if you'll open questions. the for

Operator

UBS. Instructions] question-and-answer Sourbeer first [Operator from with Certainly. We'll the is now question go Our begin John Please ahead. session.

John Sourbeer

question for thanks taking XXXX. congrats for quarter Hi the on initial my guidance and here and the

some you fire does curious the the of guidance in elaborate MVE the takes the and any of on could Just puts the of if recapture of headwinds? And that kind for include year?

Jerrell Shelton

good turn a I'm Stefanovich. that Robert, Robert John, to that's to going question.

Robert Stefanovich

Yes. Yes.

million. $XXX full we the $XXX for to year million guidance, So, have

Just achieve expect full a the revenue that of to that for include we year. couple does notes. the One,

New we at next months if included XX% the looking you that on QX revenue a Prague about the growth therein. XX% is to from three or look from damage we're that guidance. annual any So nine next in recapture Also, entire at resulted based quarters, the that

year So the are for bullish full quite obviously, XXXX. we about prospects the

John Sourbeer

making about the little a And then involved insurance recapturing from Prague for guess way rest bit New there. the Or I payments it. the about recapture sales? any the just there Got on of is that from up -- cadence think lost to the fire Is year? that just there in

Jerrell Shelton

-- are the over of -- running traditionally the served up we in dedicated progress and lost very for the that financial back of really the first years. I is The won't they that XX in have have making that's But that. John, and million, to we way rest quarter year. that making team up going million manufacturing served impact the the care a are committed $X.X customers insurance to Yes, getting smoothly. our the that in is up our been because will People loss had the mean, plant bottom-line make sure on $X.X because take revenue

John Sourbeer

lastly, changes maybe business there biotech has Appreciate market year-to-date it. funding years just guess, record in players? public clinical emerging you last a little noticed your light I coming two years. from the then, trial or impacts just And been off of biotech-type Have any

Jerrell Shelton

it the me and Let then Mark to answer, I'll start turn Sawicki.

really We any haven't activity. trial in our clinical changes noticed

starts of always and report every quarter is trials. the net know, of we you action number. terminations then new As number There's a

our And quarter. we every Phase the up mentioned number trials XXX ended is -- XX with report we what as So, you X. of I earlier, net in as

So Mark, to you may that? to want add

Mark Sawicki

add Yes. I'll little thanks. Jerry, a just here. Yes, bit

So a not a the competency if increasing the is of of these multiple that's organizations. been to very them that there clinical space. level there activity we it little focus pool look Many and actually at have have well-established deep afforded entities our been in bit. actually a a on has cash strong, take We are relates cell hand And years as fact, we support, think to and gene on that very pipeline. deep core if financing of

in the environment the by, obviously, and as the very, progress continued feel about So space we our progress very overall. evidenced bullish

John Sourbeer

my for Thanks question. taking

Jerrell Shelton

Thank you.

Operator

is question next Please Couillard go Jefferies. ahead. from The Brandon with

Brandon Couillard

afternoon. Hey the starting maybe issuance. Jerry, with just guidance thanks. Good

you issue what into biopharma if And the just detail? year, of secondarily, speak MVE you for year can philosophically, growth and Just full to terms care you to assuming go in starting guidance to you for comfortable for now? the commercial the further components revenues are feel why

Jerrell Shelton

prefaces Brandon, first question, of we're given are million achieving in on to million right this all, Yes, we because we revenue. $XXX going I a of to have up not expectations guidance at And $XXX of think, it's we, the mean, be to it's guidance. revenue. good point, --

And so that one was aspect.

confidence It's the the think with certainty lot is confidence turmoil we of to is are The a that to in we're that I give that's And share happening today. very oversold to absurd. market. easy have the -- aspect the things that we market the market where read -- other the at into negative just and vastly the

like folks from year And look to confidence want our view. point what so market know let the our does we of and with share the

was a So the two are -- that factors. bigger those

MVE we as far units. don't goes, on give guidance As

and I I are say to that MVE, except diminution strong at backlogs that of can't So the about don't -- there's been no talk demand.

In continued for been good wish and very, be to to you said? strong to just may what add fact, while. a has I very it's strong Robert,

Robert Stefanovich

And of for already and of investors give and what to wanted kind XXXX. you Yes. Maybe confidence just analysts said, level we we're obviously, confident. that

business the to about You Brandon, may talk in and CRYOPDP past, of really the MVE recall, organic to look and acquisitions. the growth reflect units at did we acquisition the versus

really this with one operating Now, is platform businesses. the

about Biological is And So, the to of revenue to and the expected MVE growth but don't Systems overall CRYOPDP, pack. you as rates talk would Cryoport both Solutions terms or have we contribute expect, for specifically results. to grow guidance in meaningfully lead then expected

Mark Sawicki

Yes, want you going to if here. one on just comment to I I'm mind, Brandon, don't Robert, question more. add commercial your

therapies on of of move with Novartis basis, like into can folks of Gilead/Kite others. global second-line already for a launch. commercial therapies you're addressable for indications, our BMS, see patient were therapy talking for expand continued on four and out expect clinical approved going a additional historically launches. right, lines well and product it, increases approach will evidence And that those treatment. success, seeing our a reasons. growing and approved And continue aware, expand So second commercial which These One, The on these about portfolio substantially as we're -- to we're demonstrating and as to we commercial clinical pipeline continue filing that focus Kite through approved earlier of to be new we therapies number just has supporting example, primary which space. growth to we trial as approvals the line, population. focus to moved That's has been the obviously

So, bode commercial from us for standpoint for a four of foreseeable well the the those future. very obviously

Brandon Couillard

for dynamic? follow-up in talked Got to the it, packet cost capacity be also coming specific Or about And a then your limiting about timeline mentioned in that's ability U.S. you secondly, that on product? just helpful. that then And is more new supply ship board? MVE, expanding the you constraints. a you on capacity Can Is the mainly that

Jerrell Shelton

some an added of Yes. I processes. I the we've speak expansion rearranged the place is as mean, capacity taking we added incremental on We've basis. people. shifts. mean, We've

an planning or the are incremental, process. it's plant take So we But but that's year will actual a expansion, also and in that so.

Brandon Couillard

you. Got

$XXX you sheet, last companies. then on that million cash unlike not much And lot one. burning the of smaller a Jerry, other balance got Okay.

share get just put You be see terms little the you on an right of bit front. in now? But pipeline on priorities a acquisition would update your Thanks. to the repurchase work what curious and to where

Jerrell Shelton

made filling do system I pipeline past. we've world. we remarks, in in Well, is about most sciences the compelling, most supply the we're in that up the areas my of as chain acquisition the be course, intend, to And life mentioned of And talked in gaps. support those for the comprehensive

made a of impact. And through cut make and and longer day. position. to they're will They out so because is a go if Tactical a it of acquisitions. Cell&Co take And at come what recently we make one acquisition of us ourselves you've of our had development strategic qualify us we those, look see time, to and couple much acquisitions, seen a tactical continue acquisitions, its that you strategic every along its I licensing The call acquisitions just you rare. in that with don't of several EMEA to that tactical years

So the fantastic of competency got staff. staff. -- that It's and a

to have do come at we in we're opportunities the We're and acquisition a So announce of along. a eager pipeline. robust space, they as them looking lot

we about the but Our shareholder everything on our that cash, us prudent and going cash our cash. are spending we're mindful cash. cash very talk are way our to is because the We we about And way talk investing reserves always invest don't we return important are We allocate -- in money. to dollar. every this we on

great have outlook. -- a we great it's a So

we a There's we repurchase can position. capital a purchase I in how go but that using other are on the will commenting We on -- in that's be far strong position, stock. as we as made than great the the about

Brandon Couillard

Thank you. good. Very

Operator

with SVB go is ahead. question next Souda from The Puneet Securities. Please

Michael Jones

recent Michael Congrats. first for Puneet lower reimbursement, morning. saw a like Thank My policy be from a one you decline to costs. proposal proposal, which Yes, than X% the CAR-T this continues on question. to about We hospital for CMS. suggesting is

overall So, changing I on overall, just wondering was market? for update view if your the in reimbursement CAR-T uptake

Jerrell Shelton

it closer too to I answer a just laser in it out It's to But this. any But of nascent then going the the Dr. metaphor, anyone is to get aren't fact I'm couple -- point. start look, So, to for first this Sawicki context should a because he's focused be of is with And think and things, still right it's taken we that it be particular on to turn now this taken baseball to industry. element I is use mean, time the to we beginning. inning. long -- a us nascent. aren't still -- for

that all really basis. different on that changing much a is us consistent because paradigm a concern the -- doesn't So there's

going to what Mark the in views marketplace. seeing he's I'm that, and let his from So, talk about

Mark Sawicki

correct. is think that No, Jerry absolutely I

to this the right biggest reimbursement, you it's capacity to isn't on space clearly. The add can And that. very look overall. limitation manufacturing now honestly at Just

new a lot capacity to all clients in of and Our the our as about, very -- shortage viral this relates candid And either vector or bringing capacity. drug substantially they're commercial it obviously, product manufacturing are space manufacturing investing of capacity impact online.

that biggest capacity perspective, So, scalability from that's online. our impact is the on bringing

an that a can it the them The them angle second that that of of lines is moving issue. overall justification use they And The these products earlier the and treatment. using a spend demographic lot component. there's addresses are relates as they obviously, reimbursement that as to online, into patient cost against that earlier bring

to It's adoption perspective, the manufacturing the years. on from a next capacity over has biggest that going that's So, our nonissue. really the be impact of couple

Michael Jones

revenue on guys. you my you're then facilities? I you start Bioservice thank any last wondering quarter, contributing is meaningfully the these to said had I for revenue. if helps. like XXXX Okay, And thinking new know updates about other they'll when the actually you really facilities. That And is was question ramp-up

outlook? there's any to if update on wanted see Just the

Jerrell Shelton

fulfill in Again, which want is a that I'm think is It what But think have center, that exactly look so you allogeneic. labeling, This Supply Global which about make because these -- what way. is to about -- the going But -- it about then to means revolutionary you with Dr. Centers comes service, a made a biostorage, and kitting, to Chain are to turn chain these Remember, the of I our of that's supply to part we'll so when folks trials a answer start third Sawicki. to it are. fulfillment. logistics world-class Bioservices, at includes some services dream. like although allogeneic Bioservices, secondary combined It's Bioservices as product. will don't

married that We're hardly a and there us network Mark supply then is and mentioned creating be more that And that and to and system. important. part chain -- equipped that which global the very supply just to It's planned that that's that provide these it the adopted converted is Morris core that though. course. are up to really built the I a operation, we centers are Cell&Co will will be centers, operation that around they few opening Plains fact, already two system. of of you'll will lot see has beginning, these. a But in supply network, Paris come And it's excited system. be biostorage chain Bioservices, chain know include that Very So, first these market. places, in therapies are allogeneic It's and any as Houston of the it in fulfilling way. will of And about and services,

XX forming backup, there's world a to surety, the power Supply having we'll because Global Chain network. redundancy, have having more have around network. in by So my Centers that of have less you network have is have guess you a lot XX that eventually, you you And a risk

So, I'll let there. it Mark take from

Mark Sawicki

thing is both it is The openings formal grand in the only and June. of their Jerry have thing on absolutely only the I'll facilities right. Yes, add I'll add, in the U.S.

related moving there's the locations. onboarding you'll product time. timing more into validation we Obviously, impact some commercial into that is However, space activity were that saying and reason and bringing see a XXXX activity processes activity material new client or a takes of the and robust to the already in clinical activity both

And so that to time make from -- very, others very activity robust systems used client is already transitions. is quality that we affords fact extremely as these be will the complete and these these validation processes. stand the the organizations by organizations actively But and facilities. in And both their those heavily

Michael Jones

for thank there. Thanks very the you Okay. much. color Yes,

Jerrell Shelton

you. Thank

Operator

is question next with Needham. ahead. David The go from Saxon Please

Joseph Conway

Hi David. for guys. is This on Joseph

giving Just guidance. some could one today. some I you targets. color if of other the from Maybe guys on you us financial add appreciate more

those You XX% ambitious is so different the And guys for I talking guys have guess or that next talked were happen, million. that over where targets? into to XXXX, margin, about to XX% an $XXX timeline happen? in about target needs what's years the like kind you EBITDA for go going of $XXX what to to million five gross the of past margin.

Jerrell Shelton

to -- today. lucky move normal target. but The we acquisitions it us -- million goes we're Well, partnerships of no tactical doing to -- a think organic reason to be and And alliances then going Robert, then we're be going XXXX, And it think you remains what by we it's then metrics. organic growth. continue that $XXX strategic if is that place on to will -- I'll And margins acquisitions it's and It -- will that back to acquisition, growth -- off and start we be and just achievable. of have $XXX into want the we as The may million just to is our and -- other Robert. it's to turn in target forward. and be thing to comment

Robert Stefanovich

EBITDA right, the we back at is things. Yes. step you're now. XX%. margin XX%. you No, where target few to just is this then that, stages right of the And Again, we're expanding and have global absolutely gross are The constantly leader are look and and a a Early revenue and capture with we market share the market, cell our our and in on gene adjusted basis. space, solutions therapy

clinical supporting now of maturing with with trials, trial I that XXX So the number. Phase XX X, clinical is this base trials mean, significant us in a

that bottom-line. few can in of in EBITDA Right of believe commercial the lead There's now, market. the we that will commercial and economies revenue support still that scale So one, drive we're margins, expansion the to a adjusted therapies in increase result building phase. only we

us still And you'll that of Jerry positive in Global EBITDA to build Chain spite adjusted talking continue see So, Supply quarter. the keep the about. out that, for a was Centers we

We expect that time. over to continue

we about think So, we're then make it's do and set half to a year hard that and happen. the working achievable, target aspirational ago is

Joseph Conway

all. you. Thank That’s Okay.

Jerrell Shelton

Thank you.

Operator

The next Please question go Paul KeyBanc. is from with Knight ahead.

Paul Knight

quarter, Rob? performance the of Cryogene in the was How

Robert Stefanovich

in other we Good. and talked a But additional of to well And I on underway. Cryogene, a solutions expansion importantly happened really continues into highlight and as expansion terms in more perspective. think the the then the Austin. Houston. sites say from already to that to Cryogene. second, geographies, plans expansion service few mean, the things I perform about that are is there's in includes the two One, in footprint Philadelphia which Cryogene

a very of in winning kind further, obviously, market, the have to replicate So locations. in capture. Houston two They additional we'll bring those approach and that market revenue that will the

are will growth So, should place, side. put as those see you be in the profitable there growth, to further revenue Cryogene from revenue expect

Paul Knight

perform that quarter? in did was the CRYOPDP And -- how

Robert Stefanovich

of very units and performed well. year-over-year growth had CRYOPDP well. performed significant All business the

made past. to acquisitions see that continue they've You'll in the

expand geographic locations. as those key of footprint more further see in their You'll they

for impacted one-time So, the outside very strong damage the impact were fire of the that QX. kind MVE revenue, of revenues of but

Paul Knight

multiple very was a before? behind revenue for What the seen we've was price to question nice attractive And seem -- price a of Cell&Co than last a what a what pay is pretty lower acquisition. -- you

Robert Stefanovich

Well, terms I of acquisitions have I we you're approach think disciplined the right. very in do a mean, overall.

-- at bring and Jerry that value, So, the referring Cell&Co much you acquisition, significant value related and was that more attractive, but was Cryoport the it's acquisition it element Cell&Co family to the I of gene to to particular, more in will really Cryoport look strategic the think really cell companies.

So, looking we're be just the taking. leadership certainly management the which entrepreneurial have it's table. the We're really for approach spirit, the They all brings of Cell&Co to and strong team would required. certifications that

it market an that's to two and view. So, us a we allows than enter have the could buildup, sooner probably years into European otherwise organic through probably conservative

Jerrell Shelton

Remember, So big add a just a Paul, that -- is purchase Paul, out. I'd of there. I'll add price of just things couple earn portion couple a

what two, elements. the So Robert number said one. And about number strategic reinforcing

our investment elements addition ROIC a In return financial that it of -- and hurdles, us met the wanted our we on the to all years all and strategic in meeting criteria. by accelerating couple of EMEA,

excellent it's So, people. an acquisition fantastic and

Paul Knight

Yes.

Robert Stefanovich

was acquisition company $X.X And $X.X of And in becoming their is shares milestones. specific some in owners the that they the of million, just see purchase Cryoport. price the further on also million. reaching earn-out of for upside $X part The took million, that

Paul Knight

pickup in sequentially the trial And then your be would that count? business, with biopharma was fair pharma, revenue assume up it trial last, to clinical

Jerrell Shelton

Yes.

Robert Stefanovich

You're non-commercial, talking yes. the about

Paul Knight

Yes.

Robert Stefanovich

Yes.

Jerrell Shelton

Yes. Absolutely.

Paul Knight

Okay. Thanks.

Operator

next David ahead. with Larsen Please BTIG. from The is question go

David Larsen

sort helpful. about that you and then your the any also impact steel particular. good a would terms of can just are on kind in just to to through And inflation clinical extended, labs, like like pretty timing Hi. a what to customers? of that extended trial components being like that me pass you're seeing in recognize also of activity certain bit talk you specifically may inflation, to related of color there Can of, then Congratulations pieces the semiconductors, timing how you some in of business, maybe sort quarter. freight. to of guess, on which sort any lead revenue? you the Can just the quickly be your to Just I throughput And be of then And pass technology through? looks seeing

Jerrell Shelton

the additional internally, me we not then properly of sort and is get And worry. thing. one squeezes comments. some Look, comment beginning. then -- Robert let David, it's because inflation may margin And on have in controlled my Mark and if that number

of everyone it. we So inflation. -- does through. well a it as we areas, else -- just materials all That's us We passed not freight, our have the I some because to pass-through. or On a steel, semiconductors we're it stainless that as have in mean, all like hits immune we freight. do aluminum,

price through On look we price in that increases. ever pass in frequently ever also the do the than others, we've We terms of done at more increases now past.

written, placed, comes finance within a increase. price -- when price -- purchase We within let when have invoice the order not in, our immediately is early our they sufficient, when the to warning suspicion, systems is companies order know not when company a increase is but not the when

that we inflation adjust so is our that we pricing make And And taking the place. goes finance sure work alerted. finance, vigorously to reflect to to that's

And other times, we it pricing is that be think to permanent permanent. surcharges. be will going Now it's sometimes if

we exist. control to have face on intelligently. over we work situations hard them so these do other every have, and And work And hard like head we situation, on, them to we because we they face

And that very been way. in in successful managing so far, we've

to comment you on do want further So, that? Robert,

Robert Stefanovich

clients paying. just to that something is our more one No, Yes. Jerry And mentioned already that is that that few are the is emphasize state covered. transportation piece, and items a

We XXX. at have had angle, about over over QX stabilized. the But you passed look actually coming a So at we a we expect look through. improve believe if slight that gross different is you gradually to if margins maybe margins our uptick quarters. sequentially do gross margins, And

As materials if they've raw sequentially, Jerry inventory to at MVE, but still stock. and safety improved up of you have experiencing look inventory. increased slightly build costs We mentioned, they're

in some will said, those that pass And we analyzing very, Jerry do take products we careful to increases through develop. for and clients. market see very of costs the But and we the systems improve. that expect any So continuously like to time to our that

Jerrell Shelton

Mark a then I to was element question your David. clinical can think, that And there trial answer,

Mark Sawicki

Yes, I is of think the that addressed only this we earlier. thing I'll that to add kind

activity. seen have in slowdown not We any

We those can from obviously we everything that extension strong. inflationary intentional is very to of the extremely extremely be on environment The still conditions. market have not robust in impact haven't seen considerations any this time seems we The on impact point that of programs any macro strong events market based or at And and seen things. trial see.

David Larsen

Okay.

on China, business. impact the having So, activity that an in not Shanghai Is like correct? your that's and

Mark Sawicki

don't of global continue basis, geographies I on see, trial three and trials -- to you the number a total all grow count. We can mean,

Now, impact not conditions a on an this environmental at we seen in point standpoint based any time. geographic from have macro

Jerrell Shelton

Mark as that. referring trials here through to specifically he's talking is

Mark Sawicki

Right. Yes. Right.

the still strong. yes, very activity So, is

David Larsen

like and good, that's growth Pipeline capacity. is it you're me great. And then Thank sounds Okay, high. and adding is you. to backlog demand still

are plants creating add I think you these those in resources? on products. plants to actually that building three one MVE order you have plant biologic adding you are to more Are or another of

Jerrell Shelton

David, on now, I'm we utilization. certainly a at look will asset -- that's that that. focused future in the right But

running that's plant two. have shift, you So when can you run one a

add do Then can run add the you that can if examining processes. other sometimes we go that adding can and the on, both labor-saving you run you on at have plants. you three. And when automation in you you underway and the If to to and in can sometimes put reengineer We're plant, two, do plants. back then on plants

first at build order business So, those of all new a we're is But of just not looking to the plant. go things.

is and there to haven't The asset out improve first utilization, order we maxed business of yet. our

focus. our that's So,

David Larsen

for just Okay and me. one then more

delayed guess, in, at get million $X and would of imagine trying that to in revenue, take there the your of competition I some I be that would looking revenue. With and some

Just any forth. What of the thoughts questions gotten so been, I've any? just around on capabilities competitive and environment. investors from color has And sort a some on any pricing and that? response some if competitive

be would there helpful. thoughts any Just

Jerrell Shelton

position the of that world. for supplier It's systems, the supplier the address. freezers years absolutely. spent world. Yes, I'm has eager a quality, occupies It and question highest XX the becoming good the preeminent to lotted any doers fairest [ph] in really cryo MVE of cryogenic dealings a in

us. they will through Our customers determined ride it that have with

it's Now, a globally. for distribution robust they've we because go but some -- stayed some called with they them of network pain But through us.

some our have, backlogs those they they're No sure benefited customers I'm know going we quality because the they're that has a services. manufactures MVE. and fairly, to than those but from product. competition of higher one be degree to the with we loyalty accustomed have product dealt those of the highest because loyal they're the quality And Now, backlogs are to to of And that customers. get going

David Larsen

Okay. much. Appreciate Thanks it. very

Operator

from Instructions] Our [Operator is go Yuan with Securities. Zhi question next B. Riley Please ahead.

Yuan Zhi

you year providing full the guidance Thank here. for

difference any will rationale can talk can and as customers existing you them? logistics New can services potential two provided be to talk you So, be will Jersey the centers, from about centers, maybe, there select about and the those the Houston for great. Jerry, terms that those you that guys And two in If centers? of your cover customers also for

Jerrell Shelton

really these do John question. is. corollary says we're in customers in point, banks? money you Morris was And Plains Dillinger in a and said, the Well, at And said, that's he is It's located Houston why good to one because where the when he places that as because that's rob the interviewed are. where he

area, pharmaceutical the the major the around campuses important major the locations. for and And huge a -- have major there all area. of Plains in are course, of Houston us following industry the players in all be those in roughly right that's Morris We to the

So, better Houston, create so to Plains is Morris a the operation very Livingston have already no-brainer. where that in area. campus the we we we And it the we in can effect Cryogene facility close serve then have a can customers. Houston was the

As as And be redundancy then far This we with viability these the talking in over risk decreasing one than We -- we create have anything. also -- one store decrease be a more because centers, never about node there's another want miss to risk. where be reduced the to cell the -- is on same. I viability. take about facility. And facilities supply further up from redundancy supply to SOPs treated SOPs catastrophic global will network can the the And that all and network. around able comment exactly effect in we're the exactly same. you will want it's that? chain the now all was and services and chain same, any earlier, effect, Mark, about the situation place, other provide the The network making plants same where then we if and we the also that risk that cell they'll do

Mark Sawicki

well. be out to of get other No, I really and the quickly. to add that is continue into as only would much that build them truncate product it to provides hands the supply the to able we think articulated more to you network, patient The ability this I it organizations chains shorten thing

of and ours a products that's portfolio them, may a newer have cord between through, the these time-sensitive non-successful difference outcome the to aspect are of some aspects. for very to related cardio make or successful other And particular, a or some coming where in that allogeneic spinal things

So, having store have time. of of able substantial will over for base lines a network to are these beneficial types product client our distribute and that facilities a impact

Yuan Zhi

quarters, Got recently, the they Jerry I single last Novartis question the their another Thank And demand has you, that in digits. were is sales have quarter-over-quarter it. And for gene and of Mark. mentioned two cell growth lower seen product products. have and

out the customers? from in are higher of so maybe kind your relatively quarter order picked the guys number quarter quarter fourth what seen you curious far? have third just signals you I'm the than Have second So, and

Jerrell Shelton

clinical Mark. standard the Remember, we of turn terms then So, and in gold industry. I'll support are to I'll and the of trials it start,

folks that don't and industry. straight there's manufacturing is the in nothing has So beginning, And is other too, industry. a it mentioned, us constraint. this development have. that mentioned at line of And the capacity gives that I've Mark the view It's a a a nascent very

see still may than turn to short to more who it -- as there being I'll very these concerning it in capacity. others it manufacturing be of But So, at it's with and certainly other this maybe to industry stages, concerning in it the can formative there's at Mark early could is. how us. mature actually point. But running it's we and nothing not be looking involved as

Mark Sawicki

is Jerry Yes, manufacturing right. issue issues. is here exactly The capacity biggest

moving in them Gilead/Kite a patient will look on commercial they're and their really their have also, platform, reach coming impact product Bristol-Myers, if product of ability of online space because will line manufacturing restricting is larger this reduce have now example, Novartis line of a starting additional second that but -- which cost addressable focused to time. over for are for going the you're patient intimated substantial as two folks reduced due line. significant competitive believe volume also has first they've standpoint launching and product to time, provide which been they of acknowledge. populations for also line, a the at from They've rest impacted product well move which provide some to addressable that from seen by third So substantial factors, lines. to you factors. have also be loss capacity second launched next going revenue constraints obviously, over new take from T-Charge a as that to online And some see population. both those to which of after on one And potentially world some addressable moving the then at the capacity patients to in will manufacturing really competitive capacity coming target much to ideally, are on to Everything years looking they this this going of those

Yuan Zhi

last me. question one And it. from Got

margin to is seen I'm in and the generally terms curious quarter. just gross have pressure first quarter supply speaking, last it from quarter In a better year? versus compared in of last better chains, getting I've next guys you this quarter

Jerrell Shelton

that They We can't team We it we incredible safety you incredible in forecast. just And better. actually provide stocks Robert earlier. they What is can an I getting sourcing that is that an the say tell companies. referred put job. do -- across to have all foresee

not our world say the tell contact We're its is constant quality this. supply as you in through our procurement are organization not We as of yet, -- would chain will out I I but well issues organization.

I the chain think couple that in of next way will work through quarters. the all the issues supply of its

And a that's and take in is containers problem, of availability. I getting of But rightly But issue has better. in think containers, It's world's harbor. course, things not it top like to it advance. supply that And chain it long. where as shot. right now of needs booking work long Shanghai by biggest it, are that work stuck will you a The will it. through be we container other They're Harbor our through. folks the And in on things. every lot address know,

through So, yet. getting bottom-line but the I guess not is I is, it we're it think better,

Yuan Zhi

very a for my That’s helpful taking color. you Thank questions.

Jerrell Shelton

Yes.

Operator

ahead. The Please question with Jacob Johnson Stephens. from go next is

Jacob Johnson

picture question, follow-up. have then I Hey One modeling good a evening. bigger

kind of only autologous, therapies therapy I these versus kitting, a -- think all as allogeneic opportunity about Just of for made But two I with supply about packaging, shipments you And to think but from autologous those, centers. as and these opportunity. obviously ones talk I think about with about you want chain the And allogeneic. volumes be one we potential storage, allogeneic larger and revenue the allogeneic can today? some

Jerrell Shelton

to of think to is you there you're couple right the I fact the the because surface Mark on might distributed. in of of allogeneic versus be a Jacob, think educate autologous things what on on But has terms you allogeneic. I want exactly think sort I about surface,

more doses it's lot a on duplicate with things more going autologous, a made. so In allogeneic. work, lot And there's

turn because any go of further. and the it let more won't just take Mark. Mark over we'll he I'll I you knows lot a to So, it, detail,

Mark Sawicki

more Yes. than It's a that. complex lot

on an class right. therapy that allogeneic could is the on but depending The bottom-line dozen dose, is have it as many doses many being a have that's as SKUs therapy and addressed. So, indication Jerry can as

So, you as may few one as have shipment.

and a the basis. obviously, supply country mean every product for based XX manufactured chain A elements each product the have doesn't B. so a never as nature has those fulfillment, that's which centers capacity therapy. key having many for in of on one right? as allogeneic importation supply have product components infrastructure autologous the support country labeling drug the And allogeneic That of in needs, to those release storage, may bulk requires from You considerations, dosed a provide, But distribution of also that chain around the particular drug and and one secondary is

in have you release go through drug only can a that So, controlled process, product occur environment. a to and

that have and for So in-country one for in that manufactured labeling do Cell&Co, drivers are secondary for and Europe the released language-related assets we on considerations. drug the U.S. for could fact the release QPs in considerations of labeling is to acquisition being also support example, and product the buying staffing

into lot and going So, simple is different autologous in there's a to a manufacturer product directly of It's factors that drug not setting this be to go then as in as patients. distribution shipped space. manufactured

backup have do You have related activities and occurring. doses, you do other

other supply in chain center in based have does, general, allogeneic fulfillment-related storage general. and However, demand need on higher a for activities long-term a

hopefully, So, helps. that

Jacob Johnson

see And those just of numbers? receive you'll and flow those MVE [indiscernible] timing helpful. insurance Robert, when around the then for through the Super about thoughts just fire. Any the recoveries we'll

Robert Stefanovich

the understand part. Insurance? I couldn't -- talking You're Insurance-- the about first

Jacob Johnson

insurance to business the fire disruption. related the MVE like Yes,

Robert Stefanovich

mean, I an business and covers fixed inventory it Yes, assets, process, ongoing that's the interruption.

from million adequate $X the so We around coverage. We've have already I think, received, far. insurance

as adjuster going that's get same the in can, really plant have up We're interest. as with obviously we interest and glove there. the working quick running was well. we hand very So to and Their the

happen the next done within be year. probably to end it most should going going of I close completely by the the that's the quarter, think. So, able work all We're over to the second But quarters. of be to

Jacob Johnson

you. Thank helpful. Okay,

Operator

like Jerry the I'd conference This Shelton remarks. to for turn to over concludes closing back the session. question-and-answer

Jerrell Shelton

the for thank And you you. conversations we had. just Thank

brand control markets want to of reflecting and position chain talented our growth. our and again our commercial we continuing on our progress hope solutions daily, good reach be leadership sciences especially joining employees XXXX spectrum. therapies good clinical strategy gene interest illuminating. We yet global updating believe And I In temperature first the Due reproductive XXXX us execute winning animal for and portfolio, questions thank supporting think across quarter. located supply in another growth and health next who biopharma, your the year in to comprehensive results outstanding and you for you medicine flawlessly XX our quarter initiatives, nations all and of cell We appreciate life-saving there company. on look you we today. our to industry, have and another evening. demonstrating was in were life quarter support We forward a will closing,

Operator

concludes This today's conference call.

may you a You Thank for disconnect your evening. pleasant lines. have and participating

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