IQV - Earnings call transcript Q3 2021

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Operator

Ladies and gentlemen, thank you for standing by. At this time, I would like to welcome everyone to the IQVIA Third Quarter 2021 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers remarks there will be a question and answer session [Operator Instructions] As a reminder, this call is being recorded. Thank you. to Childs, conference Relations Senior Communications. like speaker to and now Nick today, Vice would hand over the your Corporate I President, Investor Mr. please Childs, conference. your begin

Nick Childs

Financial and third Thank Thank Sherbet, morning, Bousbib, Executive and Associate be Investor during Officer; General Vice Relations Chairman Planning Investor Today, Officer; referencing section this and of me you President quarter This Executive Relations. a Ari XXXX Counsel; Chief for ir.iqvia.com. Vice following Senior Bruehlman, at for today in visible you. website President available webcast. are you call call earnings Presentations Bryan of be everyone. Vice Mike presentation the Director, Eric our joining Ron Good Stengel, and and With call. be and we Financial President, will our on our Analysis; IQVIA presentation Fedock, will Executive that this Chief also those will Events

like materially caution that The stated include Before we conference results during to will implied by listeners or discussed those begin, differ certain could by risks to forward-looking actual call which statements. discussed this management the from associated SEC subsequent the would with and the are annual with Commission forward-looking company's Securities Form company's I business, filings including Exchange and XX-K uncertainties in and our due on statements report filings. information

should like CEO, call be our the with measures supplement of will we financial GAAP GAAP. on presentation. a included certain Ari call, call over non-GAAP considered and conference addition, to reconciliation press discuss and which to and Bousbib. to measures measures comparable the A the In accordance substitute not financial in non-GAAP to is in turn prepared these I would for a this now Chairman release measures

Ari Bousbib

quarter Nick, and everyone. for morning, today results. you, our joining you good Thank for third Thank

not disruptions. had earlier we to resurgence to operations our Delta an the has as from through of year impact has have in the momentum these variant. strong due COVID-XX This on Our the learned continued despite manage

full of line the ahead XX% strong we end on longer XX% approvals remain finally, science XXXX, pipeline stage date XXXX. already of our Funding years industry starts continues for in which by unchanged. to drug are historically the September or launches. Our Association. exceeding run XXXX, high continues backdrop record the Venture almost and new And at of National are through continues Capital for of for X,XXX in up approved strong. billion high XX remains late-stage the with industry the Clinical FDA to levels year-to-date, of for The recent and is volume bullish $XX.X development. markets molecules Phase with with a IQVIA our drugs Phase year-to-year molecules an the at active keeping The starts over for the The to well particular. is over outlook bottom total are and in term set the the pace dynamics year levels commercial with of upcoming new XXXX strong, expand III and all-time XXXX. outlook to II very trending trial funding according Biotech be the life

And results York plans, will financial growth. conference well midterm line usual by the share which on of longer-term of outlook early to and of our for end our as Qs third next February. will review everyone with forward of we XX provide seeing driven stronger the above currency grew meeting, At investor we about was organic the quarter which, phase plans for of With in on our coinciding let's normally us The revenue time higher is the our growth. range. know, XX.X% margins by million November constant you $XX year join XX.X% think guidance basis at we for beat City. upcoming that, and you our midpoint and our XXXX, As was as the pass-throughs, and guidance can as ahead New look analyst then. I as want that our reported a remind you Revenue in somewhat hope and to primarily third We well dilutes quarter.

midpoint as EBITDA adjusted was due guidance range as our measures. well stronger beat XX.X%, above quarter Third $X performance. operational productivity growth the entirely reflecting to the revenue million of The grew our

with the Third quarter favorability guidance, the adjusted XX.X%. EBITDA midpoint below-the-line from the in EPS as diluted of of coming above as items. drop-through $X.XX adjusted That our $X.XX beat was grew well

now me provide business. an Let update the on

evidence in late decision-making, and role it real-world take In data and guidance FDA business on health electronic claims September, a health regulatory released can leading informing several their records care. continues how Our publications. support medical draft IQVIA the to cited

year trials, every With increases external provide and both therapies of context clinical the and the trials number growth studies single-arm important for rare payers. these driven of personalized competitors and medicine for disease regulators

area. our in Our this recognize expertise clients leading

major as long-term example, cardiovascular innovative guidance to And direct-to-patient top capture clients. IQVIA's this in In pharma a to external were requires of therapy. to a cell real-world follow-up a combining was IQVIA Regulatory a XX XX-year as example, awarded another for extended exposed recent an award. newly to and demonstrate effectiveness pivotal patients for gene technology we win deliver follow-up study well For had solutions and study we secondary the a capabilities comparator platforms safety therapy. data launched gene in

the to technology be the in marketplace. of offerings On front, our continue suite adopted

our You our OCE expand here. are we to with footprint continued And course, platform have, applications. of technology commercial and other familiar

wins very in quarter, adoption of date total we clinical the bringing the suite, number OCT. our are XX client to have XXX of We But OCE excited to increased customers. see new wins to trial orchestrated also

the XXX eCOA of platform experience portal across module, trials. biotechnology engagement and X,XXX for quarter, representing using module sites leading to selected active award-winning studies site our company XXX,XXX our now in bought site continues all This module. portal their have portal to a example, power Asia have that are that OCT within demand. Similarly, site strong We site our customers

deployed over XXX therapeutic this in The top using date, successfully including clients. has countries languages. customers areas. over have XX XX of To XX different platform, XX pharma processed over have unique and responses platform the projects XX X across XX We across patient million we

want I a industry. Now to about part our words say fast-growing a few of

with combined trials decentralized all capabilities, other and telemedicine several decentralized around including cancers decentralized The decentralized patient trial with and service trial OCT modules connected organized well familiar along platform. You're study nurses and including tech eCOA, as offering suite DCT. home our within coordinators, devices as or IQVIA our eConsent, our phlebotomists trial

ongoing active improve When to engagement over trial Importantly, XX trials clinical they are competitors offerings, totaling of DCT our utilize in patient with look business. areas, our over developed to we've and meaning find XX% patient of our speak trials. back XX diversity DCT decentralized or innovative including XX date XX and DCT different us. with billion. These clinical recruited trials we platform, run accelerate their decentralized trials own at of $X components which with XXX,XXX have therapeutic when trials fully are awards as in in about fully on inclusion and up look growing own step These recruitment their direct-to-patient and When DCT that actually one capabilities, sponsors, portfolio, XX services indications this unique at to is that more been importance often offerings, DCT unique XX we span our report the full-service of Incidentally, utilize our offering. we have we've countries. our trials patients awarded the multiple

combine a in space trials partner Our ability care and of advanced makes us the capabilities. with clinical of an and extensive chose to for investigators differentiates professionals utilize and full technology us this network decentralized

contracted of quarter, our Our $X.X net We continues $XX including and on build bookings September X.XX, pass-throughs; the pass-throughs. first overall for to approximately This bookings of contracted R&DS pass-throughs, LTM ratio business X.XX pass-throughs. the and LTM book-to-bill its including our including had strong excluding momentum. ratio new net X.XX billion new over in bringing pass-throughs. a net X.XX, in time was excluding book-to-bill At XX, to resulted billion

September to at grew Our year-over-year including contracted billion XX.X% pass-throughs, backlog in R&D, XXXX. XX, $XX.X

months our increased million revenue up second from sequentially quarter. a XX backlog $XXX to versus next $X.X billion, the As result,

lab expansion, we this will into several and the discovery times performance. These signaled announced We XXX,XXX new services it have I sponsors exploratory recently our in along the our now the Ron the to will of more capabilities, new and expansion top facility with genomics our in details of into on square the throughout of support comes bioanalytical, As closely services. facility quarter Carolina. moving foot cycle. in biomarker capabilities. vaccine customers to announced partner cutting-edge to investment enable in opening innovation in essential our life Scotland. And with North for over in provides to biomarkers past, on clinical laboratories ramped with access up new development XXX,XXX financial human course, we This foot last turn of molecules us an investments we've development square

Ron Bruehlman

Thanks, everyone. Okay. Ari, and morning, good

reviewing by start revenue. Let's

constant revenue Solutions a Third and $X.XX Analytics at and revenue third revenue reported XX% XX.X% quarter XX.X% which the R&D $X.XXX currency. XX.X% reported was at reported at quarter had growing & XX.X% grew revenue Solutions reported at was was Technology XX.X% XX.X% which up was $X.XXX $X.XXX and rates currency. constant basis Analytics quarter, currency. billion, Solutions on XX% currency. actual billion, & up billion billion, currency. XX.X% at $XX.XXX at and constant FX constant for constant at Technology revenue third up of and billion, was Year-to-date In the X.X% Year-to-date, of

in currency. XX.X% R&DS the XX.X% at $X.XXX reported of year-over-year. pass-throughs, was R&D third revenue and Year-to-date, Solutions XX.X% Excluding constant impact revenue up billion, quarter grew

XX.X% contract constant growing of up revenue CSMS and was CSMS Solutions Finally, was million, XX.X% $XXX in reported constant and Medical currency. at Year-to-date, X.X% $XXX reported currency. sales X.X% or million revenue at

quarter, Now EBITDA let's was $X.XXX Year-to-date billion, down the to adjusted EBITDA, XX.X% XX.X%. move in the million third up was which $XXX year-over-year. growing adjusted P&L

net million share million Year-to-date, income diluted per earnings quarter, Year-to-date, GAAP net income diluted of the adjusted or Third had for $X.XX. per per $X.XX. $X.XXX GAAP net share. earnings or XX.X% $X.XX was earnings and third $XXX was net million grew billion per $X.XX income quarter was was income of we adjusted share $XXX Adjusted GAAP share. to $XXX diluted and

R&D backlog. to Turning now the Solutions

of Backlog now As bookings, billion. rose In XX billion. last to already another delivered business. including R&D new $XX.X at $XX new the months, net outstanding Solutions reviewed, over quarter stands net pass-throughs,

Okay.

balance net sheet. debt XX, cash of $XX.X was $X.X September equivalents resulted billion. debt At This Turning billion. and and to totaled the billion in cash $XX.X

EBITDA. in at came X.XXx XX-month ratio trailing XX at September leverage net Our adjusted

with strong and CapEx resulted Our cash $XXX flow is free first quarter trend with us Cash latest million the $XXX quarter. $XXX the the was to This of which $X.X of million. improvement program quarter, cash again flow quite had from This of billion flow in million, cash over under year-to-date, of our which In our X almost X million. continues third authorization shares, years. our was quarters, the strong free that repurchase operations leaves brought flow in the repurchased third $XXX through performance $XXX remaining million share past we Okay. we've

Let's to turn guidance.

strength saw, full at we're revenue third our This in million quarter the guidance the by raising momentum continued in you operational business. reflecting As $XXX XXXX year our the midpoint.

$XX in revenue this growth previous of to XX.X%. $XX.XXX to billion headwind guidance billion, $XX.XXX representing year-over-year versus a included note Our I'll is XX.X% from is FX our guidance. new that million guidance

at prior outlook, of also year, midpoint. at result raising guidance our basis a year the FX the year is full a by as comparison million profit revenue $XX adjusted XXX we've the growth. revenue of tailwind guidance a to to increased full our about We're stronger looking Now points EBITDA

billion, year-over-year is billion represents billion full of XX.X%. to growth $X.XXX new $X Our XX% year to $X.XXX -- guidance which rather,

to increasing growth range XX.X%. adjusted EPS new EPS. $X.XX The which down year-over-year to the Moving of guidance is $X.XX, at We're XX.X% guidance represents our now midpoint. by to $X.XX

the of XXXX fact that September XX guidance in year currency full remain for our the Now foreign year. balance assumes rates

guidance billion here. government-related is incremental and up meta TAS. to rebounded a studies billion, guidance, unusual the growth COVID And the quarter numbers, representing demand expected probably to picked getting before implies FX $X.XXX quarter to COVID-XX, X.X% of of within Fourth recall course, is between snapback X.X%. to we quarter R&DS for a last of say, was effects full work a the from fourth XXX to that revenue business you'll due points. in headwind Of $X.XXX vaccine about as in show year's I'll in general from be basis and context, which the we the year growth fourth quarter

services organic revenue and FX level reflecting quarter drag. in in accelerated. mid-single is high R&DS fourth COVID-related be digits, though single for to work. that work recently currency TAS I'll expect low that revenue is to digits EBITDA growth TAS despite CSMS expected comparison growth government down. $X.XX, expected EPS XX.X% the the year's note be to in diluted the vaccine to decline in be due the the which underlying growth is We to year-over-year growth TAS the constant be will expected with COVID will the $X.XX has in growing fourth slightly last up to between and million $XXX Adjusted the teens mid-teens adjusted million, and quarter be will be between X.X% $XXX XX%, XX.X%. and difficult

results the bottom XX.X% year-over-year. billion. very delivered we strong improved on summary, R&DS up in line. strong to backlog both with $XX.X third and quarter top That's So a

months XX guidance finally, year. reported answers. for second to of cash me full the strong And $X.X sequentially quarter are over quarters to again our versus first which diluted adjusted X is through year, EPS. adjusted increased backlog and We billion, flow, year EBITDA improvement And $X.X with operator free revenue of quarter. and the once revenue, million the $XXX a we let back million for Next up over from marked another that, prior the it questions hand raising at

Operator

with from Instructions] of [Operator comes William line first question John Your the Blair. Kreger

John Kreger

of if technology around That you great. guys just implications what your tools? detail operational DCT do you one as offerings. OCT was you the of and see greater that take Curious are some and all further, for these could think the step for thanks Ari, you newer clients the adoption

Ari Bousbib

has operationally, mean, book that actually single deploy strong we one I industry that ability to challenge people, is generated. the the most obviously, of entire important the Well, you and of we've know all again, -- business the

development kind reduces And so DCT does to productivity, more what us enables execute this it efficiently. because is labor great is a and increased of essentially

think this. So just I adapting to operationally, we are

full this the when productivity decentralized there's again, trial is confusion explained comes I of space. Now because that a fully only lot the trial in

well, here, platform, say, we've As award a soon uses someone case. a digital not that's as they had but [Indiscernible] the DCT

-- Now full-service clinical if bit probably as of that that, our have clinical about a little do is I we X,XXX full XX% under mentioned, ongoing. we which trials are trials, just trials

DCT utilize larger a modules, or or it's connected that So one of or eConsent other our number eCOA already several devices.

capabilities trials experimenting puts Our of platform, clients which are with DCT have smaller utilization the tools and trying the all our disposal. of digital full the at we maximum and the together that

down, space. believe I we in this hands leader think are I

John Kreger

through we've sort proving all on talk Obviously, seen headwind of this Sounds any attrition good. you staffing. have follow-up year? market. on -- at one be rates to about quick moved we've tight a your margins? change And a And lot Is that there's guys as you staff of labor for a EBITDA

Ari Bousbib

it. I our in sectors strong There's secret. talent. since a is a we sector, This industry mean, competition and backdrop. there's have lot of for not It's such in no true question across a particular, industry about

peers all in space We have of for hunting the ground the CRO talent. are

obviously, we So responding. are

We recruiting to and of this We actively meet recruit are employees year. every demand. hiring dozens

see in you cost whole does at you a talent now, know our has and despite look you And headwinds. well our expansion got included But it's certainly been cost or results, there margin headwind. already global create pressure? that that's we've active, by acquisition Yes. that when these it that's So hopefully, overall that capability you as guidance, know,

past, to pass-throughs, declining. see the slightly actually the quite expanded this you operating our out In our and have. fact, actually that margins even results, we take this flat operating QX despite that in nicely this see -- When are that margin headwinds cost you you in when the is margins

I demonstrating and it programs efficiency and been productivity dealing yes, headwind, the we're a we've good So and it are usual is that with at. we with offsetting hope

Operator

question of from line the Eric with The is Coldwell next Baird.

Eric Coldwell

a as well. couple have I

acquired? a one number in quarter. Myriad have nature First curious inbound both higher known. I'm we but is one, on with if your being the on basis, were well I type as anticipating spend number revenue address the deal well. a of a the the One, rate couple of what a you've deals, also in Obviously, impact follow-up deals, of think M&A And number sizing might could on that fourth deals thoughts much ways. in expect the quarter morning that as of any this you the run recently the you companies as I of than

Ari Bousbib

Okay.

of quarter, a And part more was fourth a I the let that's that? minimal. over take mean, of little and TAS. a contribution latter Nick, little the for the So quarter, for bit In M&A question In basically same the your me R&DS first. the maybe point. than

Nick Childs

Yes, fourth points. quarter X.X total little over a company were

Ari Bousbib

growth. Yes, our X.X to points of contribution revenue

Now happens had We yes, last spend a I to note It's doesn't or acquisitions going always year. will is spend we year. It it we much see lumpy. binary. be this very big didn't happen. that

I this year, million. we million spent think money. this $XX in $XXX spent more quite spent a $XX million. we are where bit or entire And the actually, we there year, and quarter And quarters

and our done request in largest acquisitions a we simply the the that million in of transaction was consolidation we've is the quarter. know, lab joint you As $XXX second venture did business, the

that the In really transactions. vast actually of The were to ,XX% say, almost we We the in a almost let's of very represents very we of handful largest -- we in like quarter, and half actually second the X that active. oncology, the portion, that detection majority, the large Myriad So sales, to date. a biomarker sophisticated for spend is accounts were a and It's something only only. XX% closed and announced had therapeutic areas, lab supports spend. development quarter very transactions third it during It's immunology. CNS RBM early- and closed It in the late-stage quarter. our X drug Lab, testing. which One specific performs XX% earnings

solutions health come and and be a lot DMD acquisition provider purchased And -- care advanced of also a analytics bit. did asset. yes, marketing, to marketing of quite to We for consider we strategic that It omnichannel leading it DMD. a analytics and digital intelligent insights costs with is a professionals. brings it tech-enabled

bulk the again, So basically spend. the these X transactions, is of

Eric Coldwell

Ari... Now

Ari Bousbib

question, second a have You right?

Eric Coldwell

Yes.

Just a one. clarification on the first

So understood said DMV, the think correctly. you last if I I one,

Ari Bousbib

David. in as DMD,

Eric Coldwell

DMD.

actually a is And Analytics Okay. Or & Got a CSMS it. deal? that segment then deal? is that Tech

Ari Bousbib

Tech Analytics Yes, it's & a deal.

Eric Coldwell

Okay. And burden then and you about but talk necessary. COVID bookings, also XQ for my follow-up on typical R&DS my specifically is revenue in as contributions other segments to in

If backlog activity you on and be related could update in in the R&DS would in work total to us about COVID XQ talk total COVID-related great. bookings of then

Ari Bousbib

a Yes. tail little I going it -- think There our to it's mean as step-down. work bit. obviously continues certainly, it. COVID on the TAS is significant is But we to segment, a a

digits. have gradually going just in away rate going We the that is before. year. forward. going last and is underlying this down return single we're will certainly work dramatically you TAS and happened to The And fourth quarter what growth the organic noise The eliminate the coverage in start signaled of high government-related once

growth that it compares, so noise where single the been the in the quarters You was the to you remember included the in growth grower digits, TAS and in that the We've and take cetera. of our June remains most 'XX, work. excluding mid-single-digit when out of And prior we investor et rate high would we've year. you when said that's conference single accelerate COVID-related in TAS digits, TAS significant reported that historically told we and high rate that was a

us the On numbers? give the you RMBS, can

Ron Bruehlman

to backlog. Look, the backlog. look strip COVID the And mega we sure. backlog the of Yes, R&DS, Eric, X% than to like contribution at if you from trials, the less of out it's the first, of vaccine

growth, XX% COVID-related I think, R&DS about asking even accepting very of you take revenue, the the strong quarter. backlog. R&DS work. If COVID And you to had were And COVID-related the less X it's all than the out of contribution in work, look,

strong large XXs take even the in were R&DS growth. high you the fast revenue out COVID burning you growth. If take work, work, you still out were for teens all if you And COVID-related

business course, we very strong So COVID of therapeutic contribute, in trail forward But go in other time. over down and work the underlying is and as did R&DS. areas ramping the will up

Operator

the Your Meehan Jack from line Research. with next is of Nephron question

Jack Meehan

about your versus how the the I longer-term headwinds about wanted segment? you guidance you work continue the looking prior the feel a I durability thoughts maybe talking Just business, TAS conversation. year. the on COVID quarter to But around that? little But talk like think at just referenced bit you could in the COVID fourth when of some

Ari Bousbib

quarter because no a quarter, headwinds rate growth slower noise of rate you quarter the eliminate is Yes. growth -- quarter. with the fourth Again, the question. work eliminates was here, in last that, included year's bunch We're a TAS. when fourth digits there's in for high which it's the fourth underlying comparing of which organic which the COVID all single mass The Again, in simply is for fourth and that noise. TAS

headwind there continue. is to underlying we expect So that in and business, momentum trend and the no

our earnings. release guidance at earnings. release was decided will, away. Last for you We on just do XXXX such this provide X our it And which plan third investor -- of an quarter it unusual concurrent November year, give is with our to quarter the the generally year, we weeks to concurrent we fourth the because know, guidance with of year, conference, year we as provide

Jack Meehan

the environment, puts They've want for from Great. bit steal Day me the thunder that one a but Are consider? now, year. to was weeks you I this stands elevated pass-throughs. don't of and XXXX. takes from is And The the you about curious if takes little few would could you seems any some a there then talk been Investor very strong. that to out I any thing referenced, obviously as funding And

the might Just would helpful. next any around phase in be year that color how

Ari Bousbib

Yes.

asking. we a to mean, look you're if capital context and cetera. set trends X-year it's EPS, things for 'XX, go leverage, always June put in longer-term at the you as important I et targets profit, back look, revenue, gave to deployment And So of

no I because not whole could such when then don't that you 'XX and businesses every months disruption fair the COVID. like you would But predicted think we would because and at is kind single to COVID across to out, effect have for to. the just to starting including -- this is one we yet of on world even strip that. But you of the pass-throughs the and gone later, because that's and of metrics. I And of all to ours. a Now one the think bit ahead 'XX pandemic, be X have little COVID that for if people we're referred of still try that eliminate look

numbers more I had was precision know what be, if a for Now you're push on even growth conference, trying I the I don't that me company. the hoping doing, and as said to that rate XX% XXXX for colleagues but to are at you as doing then would now your exit

'XX reached Now will earlier 'XX. I've in this I year, that into we 'XX. believe momentum continue end that, And said before, our that of targets

the confident feel precision beyond. all further sitting acceleration numbers can I say, I stage But we wait here will those X gave that certainly more have exceed and years you we that for to that's totally set So very, very ago weeks. for to I and

Operator

with of Your Shlomo next the from Rosenbaum is Stifel. question line

Shlomo Rosenbaum

of Roche you general the to the areas? the are state are particularly that offset other gotten where you you kind and OCE progress where significant with the you the drag a seeing revenue a in steady to can of talk cost exceeding about business the implement. Have in point not of or on where implementations terms are with in Ari, AstraZeneca? you just revenue have And margins implementations, hitting like to

Ari Bousbib

I are large costly. we additional And mean, and up the have a very new wins. XX wins, bring I because referenced you annual an report, implementations

to award, new time a every have you implement. So again,

one you of when revenue, like start not happy curve the are generating the and it's implement and have that sold the So behind you implementation did. we're you new to we still license

costs. will, if plateaued revenue inflection we passed, that if in point essentially a pass where yet penetration We're implementation significant license not Moody's we've that aggregate. seen headwind, not your the and haven't you're installations. market of sitting for in there That's So you not drag, and we you tight terms and now will, collecting you're essentially

Shlomo Rosenbaum

And for maybe Ron. The one's flow incredibly this Okay. cash then free was just strong.

there's changes? XX% of how can working of a capital on items? And than about think, you what's of this some go-forward about Is increase this healthy -- Or Could very should had that be thinking capital revenue numbers. you Something is keep record more all a we on There adjusting up? something in was more Obviously, up basis? it on? or and the some you working catching year, which going a significant this I was, talk year, quarter. last unearned and other

Ron Bruehlman

effort lot receivables, as don't our made is would Well, largest a here classes one concerted really our inventory, We we've really processes you manufacturing firm several on have improve investment. software than of we which, other been in have of that's of a deferred And our around internally our where course, assets. Shlomo, to -- are have efforts assets of fronts. a been receivables have our

And unbilled fashion. down comes had processes a The more billing amount of focused is to internal amount from we had more we on We First is I to mean, billing a receivables. receivables. about more on of of us. large go kind go time. while, that's -- collect had And a due -- that timely what's a off quickly, little large back and overdue just collecting next in a time.

more we an a paid is deferred with third get the negotiate again the mentioned timely upfront. So customers, contracts paid internally that that so we get to course, revenue We get. in customer advances that you the And we more fashion. of effort our made

out the we're flow pocket, driver to of So strong those has helped not and a X I be of all that future. this expect of substantially. cash continue in And

it's Quarter-to-quarter, difficult some having the course, then of that time to over is do rebuild of where predict. instances you're work you'll said to Now, get off an out doing of amount unusual advances you And burn that up. flow lumpy. get will and cash

you processes cash focus our too that improved urge much not fundamentally, result. quarter-to-quarter. what would I So saying underlying you're flow generation as and our a to free is But on collections the we've improved yes,

Ari Bousbib

mean in very of cash I bad add just poor. honest. might the some I bad we're was with years flow our the point but out you or And past so, X us. let's very This if that, Yes. I had a performance, for was think simply performance be to that a pulled pleased

the cash pay happen work improves. well right are not So was us, and we just ago, not always, unusual very not we will $XXX and as are million have where the the number. is company normal, something, it, and we we just said incentives on XXXX, the bigger into and the metrics and and we it. was a now And shine will free that we And you year. an good. focused Xx and X I here. attention on now what here flow to And on that we entire it the much And quarters not outperformance that the and year, continue on I light is long when mean team unusual. we right that's so we've are, already on. the of look, think But barely generated too performing generated for the thing. over fact in Obviously, are

Operator

the Windley line is with Jefferies. Your of next question Dave from

Dave Windley

of where what I'm around believe, ask dollar the changes seems I does you're pretty substantial platform. if relate us efficiency? question Ari, how garner have Wanted technology-enabled like of because It to to DCT could on now trial? follow I around that number that more your a John on, wondering trial of And a to you -- you the He that around fully give value operational. up DCT. running pretty trials opportunity financial. you in a the margin to Kreger asked wanted

Ari Bousbib

overnight. I all there's it's DCT, clients, Yes. become to sudden it's operational high okay, to overwhelm like and how a from look, XXX% interest degree of and of going around not mean,

particular, in lot or using other. A pharma, large are trials experimenting. said, is of one I composite the As

take So it's to time. going

to the this that we're you're year not to issue or have year is after that face So the next raising. going

solutions customers to with striving point fit make experience, together. are various how Our

actually the DCT. said years want we to technology -- got want we this model. accelerate to aggressive and merger We to move here. since down X being changing and the So are ago, We've introduction slow very very not

question -- a then that seek you based pricing labor ago, is to asked you question asked and as trial labor and you the of largely model margin. inputs, your of what us replace et which the in where on are the aren't years obviously, what on lowering value I is a the many implications is Now cetera,

don't so. So we believe

to had outputs. know, deliverables one, and to run a made you effort long We number That's and as -- that have has we've switch progress. and value pricing substantial

less error faster, clients efficiently more And that saving here that. what looking not are looking Our the premium a with getting are for pay They're want willing answers at there. couple quality. or with need they and they really to a at pennies higher of they --

than going not paying they not before, they're pay were but pay to Now before. going they're what they're to what less paying more than

And is are roles, the delivery new time. we we so now which less technology, accretion. going the also There the to CRA more correct. deploy be is visit Over there's more the to But margin again, of activity. some offset need time, going reduced margin the people, implication take this

early impact I on to the So for exact think too it's margin overall. comment this

to anticipate margin do our we business. is not long-cycle monitoring -- a We very performance. are disrupt this R&DS

XX working you ongoing XXX trials. to maybe on also look We we're under at, -- said, have -- we decentralized I trial if as But full-service won. I that fully just mentioned

fraction a it's that. of So

trials look we're If involved total at X,XXX with, over clinical this we're trials you in globally. that the involved

So good it point. does take It's some it's But to a penetrate. a slow-moving time business.

totally are anticipate margin value it. the deterioration. I'm We do not anticipate term. accretion a We We do -- margin a on focused sorry, over a long

Dave Windley

it made It COVID. you've a seems appropriate not slowly the through that so call and it's important you second booked lot that I to will more think time. contribution comments phase if that to around like Would question seems I and that think Great. out. a focus now, revenue about on going see speak, could over not be projects past kind of so, the off, me, ask 'XX backlog If in even follow-up it focus now on into going to how on out how maybe 'XX. to soft much to And it's in much how the equally Is a to a landing, drop to COVID just way of taper right it?

Ari Bousbib

lost as the absolutely. landing what a not on a time it's get the is say. would No we course, the based soft -- is business, know On now, what of 'XX, exactly said soft It's by frankly, today, Unless, we see to get you What COVID. the rounding get question. we in by it's I another variant rounding, we 'XX. landing, in There lost complete. it and But right 'XX, R&DS or we 'XX. another

Operator

question is of Dan Leonard from last the line with Your Fargo. Wells

Dan Leonard

there Or site trial any on operations? site comment continued activity Are is you flag? Can bottlenecks normalizing? you

Ari Bousbib

Ron?

Ron Bruehlman

visits pre-pandemic an recruitment We've site near at XX% a site levels, close around the open, not sites or seen around so. been And are work pre-pandemic sites but The look, just operate quite, hasn't Look, accessibility numbers that are But little and coming us. and patient it normal. larger gradually to that we've and still to patient start-ups not equal, levels. the remain Yes. all for bit. managed are near lagging issue back.

issue gradual been level operations. our time a a look major we it to pre-pandemic back when over improvement so pre-pandemic we'll yet totally operations, for overall really we're And not our and level, at to expect hasn't back but

his in to learned opening mentioned driving how we've manage remarks, around Ari As the...

Ari Bousbib

A in numbers startup -- that So -- mean of metrics. XX% from across is which we're the as And a and or XX% the I those as awarded, got here percentage Yes. all enrolling is I over sites non-COVID to strong the line visits little see being a the The or are again, higher, but detail, base basically, XXXX more patients between delivered. trial it's numbers but ongoing. we metrics that you higher patient of bottom the little start-up, are is more site okay? these levels, globally. is thereabouts it's so site is -- for that can see bookings, the also enrolling, not provide the are be only starting pipeline that confidence bit

hasn't major or there variant been new think result I that. of change any the like anything So from this as a

Dan Leonard

Ari, competitors the pretty by quarter? various share allowing you opportunity strategic gain. And an the a in follow-up, comment on perceived been share R&DS your open trends as You've for potentially about actions can in market

Ari Bousbib

Look, in it's hard share given to look quarter. at market a

But lumpy It's we as it at quarter it's were should from we we also wouldn't -- don't say, like always XX trial, the Okay? book-to-bill business on defeated ratios. the book-to-bill the or -- can because we first backlog and over we've the -- and look, -- quarterly I awarded look or be following. the you on longer-term ratios months. we focus gave really, next focus believe lumpy we

you as right? market mergers a or but been trials, look some do mean, the yes, of we our customers, don't impact we've I out will on of a with throw win have CRO you And disruption. just in Now So at those share. if new overnight overnight, to conversations customer of competitors, an lot a there's middle had

us. underlying and their And -- life. all don't merger favorable that like But some know. arrangement, who share. acquisition result is we know Maybe that's business. the people don't and it's of disruptions, that and in we the our the had -- does people a just large merger feel to to experience remain CRO lose that We market I we from think the problem of after I standing, jobs, 'XX. a There's last what there's new

rebounded which company issues together then put have we we about be it, the honest integrated. once Let's and some market we share

very we is think -- us. for the are bright I future

gain customers. extremely new in the right environment biotech to hot now. particular, extremely, continue We And is

We will share clients. before. with here that the improved. on our gaining making extremely Asia had In when inbounds customers that and no I the we has we momentum think are see a teams look In Europe, doubt and and are winning energized back, new are we never as we're we market well,

Nick Childs

the Can of question -- this last is going day. be our to

Operator

Citi. of line the from comes question last Patrick with Donnelly your And

Patrick Donnelly

Ari, maybe a question. on that follow-up last

all talked mergers again, space, about on the going disruption. You a little kind the bit of in headcount

shift not earlier quite the around on and of kind inflationary being some maybe up acquire grab there costs, Following guys that able of talent position so can you're you're you the of on you full-service R&Ds. that stable questions maybe some to during And terms kind side? modeled labor of pass tough customers? there? terms terms being price in backlog with on then labor some on that, to costs better focus particularly contracts how you these wondering of these But in can much just seeing does know one mergers, are and of to to got the of people, a of pressure secondarily getting much in on adjust. some I some How price the pass a increases

Ari Bousbib

then Okay. question, the level CRAs, leadership personnel management executive actual Well, you've to the cetera. differentiate field the and on between et got force with

that small numbers. But the cases. are and few bringing happened in dissatisfied will to these where only there they is challenge that again, it are first yes, general, So group, opportunity first category, an in has somehow on a already the and with occur

On the those difficult competitors as that's CRAs so and driven they more much that the also as our in we it's by by and of lead the on, are midst need project book the and execution the of much trials because do. and people business

the mergers and not people affect so inflation about at before, the result there's that the there's And the is field. immediately -- of -- the the talked but CRAs an on don't least much in we all doesn't which just wages, factors

do other Your had question to

Patrick Donnelly

do cost. And pricing. we need a passing With on

Ari Bousbib

Yes.

your very hard. noted you in as So it's yourself question,

some those contracts. can't -- into projects assumptions. built we escalations factors and some You sold with there are certain And

was of then of the no There's magic R&DS the and all going pricing there's going here. pricing in to It's is fast secret. business. nature and So on it's no cost, to have the you obviously, our affected. different that the set certainly business, on lag will by large, But get because based then be have we and assumptions reflected. as higher But move absorb. But to forward, you when

Ron Bruehlman

course, side increases. of TAS pass And shorter-cycle to business, business, cost Right. on greater of a the ability along the

Ari Bousbib

there's Right, less but labor.

So that's..

Ron Bruehlman

Less correct. labor.

Nick Childs

weeks. us Thank forward We Investor our joining for Day everyone a today. seeing you, in look at everyone, few to

questions, reach answer any out. feel have you joining to other If today. Thanks free for follow-up to We're happy them.

Operator

conference call. today's concludes This

now disconnect. You may

IQVIA (IQV) 21 Oct 212021 Q3 Earnings call transcript