TECH - Earnings call transcript Q1 2020

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Operator

Good morning and welcome to the Bio-Techne Earnings Conference Call for the First Quarter of Fiscal Year 2020. At this time, all participants have been placed in a listen-only mode and the call will be opened for questions following management's prepared remarks. I would now like to turn the call over to Mr. David Clair, Bio-Techne's Senior Director, Corporate Development. Please go ahead.

David Clair

you us. thank and morning for joining Good

On Kummeth, Hippel, Chief with me Chief are Chuck this morning Executive Officer Bio-Techne. the of call Financial Officer and Jim

Statement. briefly Before let cover our we me Safe begin, Harbor

statements those this the Company's of differ XXXX forward-looking update including Company's or in future identifies that the XX-K considered during projected results. within certain comments website any may a the call. made XX-K The not The materially Relations as the information Company's cause expectations undertake any result statements, other during conference factors its beliefs this Some call Investor Company SEC Company's the to forward-looking future new for as developments. to well be does events The about from filings or forward-looking and section. are statements actual results as Company's on made of the available fiscal could year

provide measures comparable During to now GAAP financial most morning I'll Company's the available performance. call, measures to call Corporation ongoing the press to non-GAAP used over are may Bio-Techne earlier at in website information reconciling measures on this issued business turn www.bio-techne.com. the pertinent Tables these release Chuck. to the be

Charles Kummeth

our business double-digit Also rebounding with delivered performing a well. our RNAscope morning antibodies, last and with in our for quarter organic first call. our growth simple platforms first broad quarter across We product segments fiscal Thanks revenue everyone. quarter double-digit The proteins, growth. Thank OEM Dave note joining organic and and contributed geographies was XX% conference XXXX. a rate on started double-digit good you tools us continuing year-over-year growth exceptionally to strong diagnostics for we fiscal increasing from XXXX Western,

start As quarter. at geography XX% increased revenue performance over we will Europe. for I the our QX with In organic by look

experienced of the quarter. headwinds quarter strong the a As normalized we the that quarter. to one in contributed last customer of a this from expected Recall European large headwinds region performance timing was the in we last order faced and the

we QX During order. received this

large the this our this for is fiscal order Excluding growth single-digits was the high remainder our XXXX. and European of expectation in

fairly European continue continue the positively of quarters create any put place ahead said Europe impact our the us. over initiatives do the the to with come. slowdown bleak easier so in weakness. the customers about ways we synergies these there it years to and across will continued is in business economic to foundation for implementing European several popular business past of have efforts team creating That for The to closely growth make peers We believe our an creative regarding signs for Europe industry monitor view to divisions

driven been solutions growth to strategies the strength There's product by biopharma. lot XX% research north North to customers in continued regards of America make of searches a for we also With do complex allow our digital to website efforts market including to their which enhancements dedicated and was find needs. organic particular our

website strategy our increases correlate with key through we with search progress continued web pleased Bio-Techne forward our traffic growth digital these revenue double-digit We initiatives growth especially increasing protein market website. in the our antibody important and channel. visibility are view driving digital brand component have portfolios. our very which and efforts of are seeing efforts strongly in beyond a double-digit our our into marketing been optimization our and These well very this translating traffic engine with However, go as efforts to the

positioned both we products. penetrated high continued our still sciences in under growth competition China's and priority in and our be year key any very strong reagent and spite performance For still XX% growth instant nearly of a platforms. five the in well industry for are plan with China organic life of The local in quarter continue is to

deeper into XX% growth with quarter. dive our for the a Now performance platforms organically let's of Protein little the segment Sciences starting those which grew within

proteins growing indicated, for extremely with QX and us I've mid As well both in the product in performed quarter. in already antibodies the teens categories

branded in high our division, and a solutions between quality division, for the addition reagents gene to In our efforts hybridization recently initiative immunohistochemistry This validated we across providing recently marketing antibodies digital our to our growing using and of our acquired Technologies. IHC chemistry leveraging approach transcriptomics platforms antibodies number editing organizational began validating a process of researchers. situ ACD leverages in genomics synergy B-MoGen

has years as cells question excuse rules known the has benefit quality to superior express systems not antibody encoding an an if editing, Biological no our an antibody competitors reseller and out. antibody the our abide for to antibodies selling branded specific has validation of from There where antibody and gene background before increasingly to customers. been where that the protein must of has asking standards suppliers gene customers knocked been for challenging sales. antibody provide by our or are antibodies Novus specific R&D Customers shown to anticipate validating and antibody. be cells service for from assurance to approach We the in quality various bind distinguish ultimately of of multiomic become a and the the are the protein the suppliers increasingly me, this For the number increased quality more process numerous over tested

the ourselves to gene for continued position coming provider therapies. of also a wave and cell tools We as

new therapy workflow. important proteins GMP polymer automate GMP fiscal provide scale growth process will years the will still XXXX. a quarter in for our viral gene cell GMP ready in and dedicated business vectors gene With driver in to our monitoring proteins instrumentation proteins relatively over supply a evident product our the half can portion customers business company our our XXX% therapy come. and of we our While we portion we be GMP very broke factory larger to the and by is B potential already of non We to technology QX. in small in of significant protein the cell and now growth and cell This today, be to therapy ground second where in in and experienced gene

XX% than Moving growing getting instruments evidence platform saw instruments from not where consumable year. was the to installed simple be Further these getting of these quickly market portfolio Sciences that are acceptance. the Protein over on within the instruments Western to our an used. achieving They over just higher and of continues base are are installed growth of they last With XXXX show. worldwide double-digit we star

opening XX% in and was with QX both genomics between growth growth. of mentioned in in growing our operating my comments also balanced the I segments with organic segment our double-digit quarter As the diagnostics

Here returned double-digit specialized reagents. in the and to of business tool OEM all major its increases controls clinical nearly product including diagnostics categories

than timing the was QX. in QX it positive more was expected last OEM the As order quarter in

our stabilized year Also in flat fiscal with of relatively controls glucose business quarter sales the year-over-year. first our

its we and diagnostic come by with to single-digit sales fiscal online. recovery XXXX be expect a Also the XX% grower new mid diagnostics in genomics and division our higher years platforms this Going at with as with OEM assays growth for future increasing growth instant customers least RNAscope forward continued possibly within over in segment all of QX.

into workflow in performance combining portfolio. delivering high requiring high the gain spatial we this sample for genomic with XX samples. high growth greater RNAscope the particularly the assay RNAscope tissue precious we believe assay of quarter detecting The simultaneously mechanisms while genomics the still flex another up minimal assay researchers targets. well early launch to and capability simple will which a cellular is to preparation our flex RNA be assay enabled is insights high for the functions the During morphology and studies preserving by driver of with but flex suited It released

Exosome our liquid let's business Now biopsy discuss Diagnostics.

news considered prostate Medicare big milestone Contractor QX Medicare being or here are an in local This for initial LCD for a Of biopsy. for on EPI our beneficiaries major issued course December men effective EPI after Administrative is who XXXX. tests for decision administered is NGS that or coverage final covering X, reimbursed the

this for be than with more now beneficiaries tests. covered will EPI Medicare LCD Importantly XX final million the

progress nearly EPI as we XX as plans for XX Medicaid. quarter with made have of covered contracted payer well coverage the commercial We EPI. under states private currently also During

private expect the and a everyone on EPI forward. We Medicare forward recent updating to of payer coverage decision within community drive increased to wins contract awareness going look additional

most these unnecessary that reimbursement about prostate prostate what been regulatory counts slower every in the With Following in we XX% and a strengthen summer our we unmet or higher were sales doctor message EPI marketing garner our an to so we the need. test to are quarters a a as EPI viable potentially just for recent the All serving million acceptance biopsies use well now positioned of positioned acceleration be alternative than leadership revitalize until year, volume. very couldn’t the over last in seasonally patient performed more months excited year are milestones U.S. test we has unnecessary biopsies.

great are fiscal our in summary we In a off start to XXXX.

year intend of double-digit The what be growth. second we of fiscal to years many

our a strategy the best be adjacent and its a many accomplishments I'll we and penetrated decade with tools therapy proud date. to marching I'm in to long markets. very a that are reagent biopsy genomic show in are With That's of performing very while pregame still still Meanwhile what ramping is to cell will are team core call portfolio we over proteomics the Jim. runs. over non-inning of home believe our in and gene liquid Our and their platforms at Bio-Techne and under the analytical turn

Jim Hippel

overview foreign decrease in for Thanks a company Starting will negatively by GAAP was performance, $X.XX driver as $X.XX. to on the in the biggest financial total impacted provide quarter financial change $X.XX. of in QX year. the the well EPS $X.XX exchange value which investment reported first impacting prior an overall the negatively each versus The segments. compared EPS for color EPS in our performance some our for Chuck. of GAAP fair $X.XX ChemoCentryx year $X.XX adjusted with the was EPS ago by with or was GAAP one number quarter I as the provide

reported XX%. revenue QX increase increasing organic was year-over-year an of million, revenue with XX% XXX.X

and quarter geography both XX% contribution north a growth acquisitions than U.S. X% Europe while XX%. from translation. grew reported impact of exchange foreign unfavorable nearly By China the a sales less X% include from First grew and

mid market rest which teens single-digits. increased growth diagnostics low our for in was end Asia As while in the increased biopharma By mid and the division Asia in organic of the the excludes teens. academia

and acquisitions details to timing, year. of mix, some product The currency absorption of extent total lesser company decrease to foreign compared to unfavorable factory XX.X% P&L margin the due quarter the in Moving the XX% a impact adjusted the recent on was to in headwinds. prior gross was and

expect we expense while was forward support our be QX offset margins Going to prior by additional leverage XXXX. SG&A revenue investments XX% to growth. to Adjusted from flat compared fiscal in to relatively SG&A was in core business comparable year adjusted gross as well of as acquisitions the volume

lower was points of due that beginning year August Diagnostics volume QX XXXX. basis of X.X% at Exosome closed than XX in the the expense the prior Recall R&D revenue, leverage. primarily acquisition to

Exosome So for XXX related XX.X%, of expenses decrease adjusted prior of the our QX from basis margin period. resulting three year QX XXXX operating months includes QX expenses. of included whereas their XXXX only points months The two was a Diagnostics

flat exchange, extra adjusted was foreign year this impact results as last included operating as the negative the was well excluding that month in Exosome year. margins of our to However

Looking operating with period. expense the interest million at prior was net flat X relatively numbers year QX below in our income,

primarily Our differences adjusted it of million other in down quarter on million QX end expense exchange. XXX.X was zero foreign XXX.X debt compared transactional is the X.X Other to for as to of non-operating year sheet the quarter in prior bank from the million income essentially balance was at from XXXX. the QX the due

For GAAP losses unrealized non-operating investment reporting ChemoCentryx. from in other includes our

the tax in tax year. our remain Moving the and on to between we remainder down effective the rate to expect P&L, XX% range for effective adjusted QX in and rate of XX% adjusted the was XX.X%

capital cash million paid expenditures quarter our first million outstanding. the dividends in were was operations XX.X and XX.X was flow return and the generated from average to of Turning shares of investment quarter and to XX.X cash net million shares in out XX.X million. diluted and capital of

was the reporting discuss our reported revenue also Sciences X% growth to XXX million segments with growth reported XX%. exchange on Protein revenue X% QX and revenue segment. performance with increasing Next foreign were impact acquisitions with unfavorable having contributing sales the growth. Organic of starting I'll XX% of

due and geographic a broad factory foreign and was year-over-year absorption B-MoGen very recent basis of described, XXX every major product unfavorable As unfavorable Protein was Operating mix and margin segment the [ph] segment a in the the region. exchange points this Chuck Sciences across previously growth category lesser extent to almost decrease and XX.X%, for to acquisition.

the diagnostics offset XX% QX contribution also were an XX% grew by from from and from reported prior a year. Turning XX.X to extra the Diagnostics sales million, foreign a with owned sale the segment, impact increase year month genomics we exchange growth on this X% revenues Organically translation. X% Exosome of

mentioned division As last consistent double-digit to our contribution this fairly the swinging on quarter, run controls the rate quarter in growth. track to genomics Chuck growth OEM quite double-digits more and diagnostic segment our balanced business to back with haematology in was its growing favorably orders continuing compared

year. from prior given in and is correct both and and penetration Diagnostics recent fiscal business forward the for single-digit we recognized regards less to next as a revenue of volatility EPI this stated anticipate growth payers. launch basis. mid being cash quarter Going commercial tests This anticipate its in performed full our accounting division calls With I relatively Exosome the contracted and OEM diagnostics is from on treatment low

revenue patients process QX order insurer the the was payers using insured for by from minimal. For patient quite rather long. can our payment non-contracted in private be results EPI appeals recorded by Thus

lag to expect year a our fiscal the We to XXXX. Medicare second sufficient our local cash anticipate from receipt coverage payments claims Medicare be basis Medicare for of the As Chuck recognize submission recognition tests received claims implying contribution day between expect revenue. favorable claims sometime We Medicare accrual we XX claims will Contractor Medicare in December patients. of paid. we final NGS. Xst revenue occur Exosome a and cash Medicare to covered final to After Diagnostics minimal cash mentioned quarter a we Despite for to LCD from have EPI the fiscal collection currently Administrative will submitting we do of favorable on history on to there until continue switch revenue a early decision

extra expenses of Moving on the reflects the X.X% segment previous down margin to year. to partially genomics from segment. decrease mitigated by was leverage the operating the the margins month The the strong prior and X.X% year operating for of reported Diagnostics at compared diagnostics rest in volume segment's in Exosome

segment the the operating from extra Exosome Excluding of Diagnostics the dilution QX for month margin was X%.

is at the QX the full gave played fiscal last of In we consistent summary year to end year. out guidance

to a to relatively hold As and XX% call reminder last this cell our grow on a we margins quarter's adjusted while strategy. gene organically discussed in in range and that our investing plan operating XX% was year therapy flat

rates. ownership improving pointed the We impact foreign our follow. the followed Exosome likely on that have have impact year-over-year also was on to quarters of to the extra the in one sequentially exchange the in year-end by unfavorable month explained of margin QX we finally was margin likely And to out

the strong with we fiscal very year. start the We pleased are had for

some diagnostic helped timing Plus in the favorable the were European though started segment organic large the XX% still even between about -- to talked order OEM of the timing full by with business. a we year we're our science the that timing to range. as well year we XX% XX% be order some in anticipating growth helped of of approaching Chuck as annual However tools

to our XXXX fiscal year operating adjusted relatively expect year still We to fiscal also margin be flat for XXXX.

planned of with gene our improve still cell the prepared over included therapy us concludes the though in questions. year. expect my we FX is the much QX unfavorable the is back our I'll remainder impact to investment continue we Diagnostics operating us. adjusted the we margins turn of fiscal Exosome ahead to to and behind for impact is forward expect sequentially That baseline the for from of year. remainder to the and that call the not that QX And At for even open comments line rates Going current Nicole realized from exchange expense of being in of

Operator

Souda We'll [Operator first our from take Instructions]. Leerink. with question Puneet SVB

Puneet Souda

a wanted a Hi we and what of sense into flow what overall from calendar the quarter get strong like are end from a overall customers America? Jim. North overall business you you. your about a a head here, I view looking commented as just the Chuck have hearing you here, year, bit give I trajectory of to is and just biopharma to A expectation Thank you us and then you and demand the And love would of Europe are more thinking little what's about the Europe, longer follow ups. term few in get how

Charles Kummeth

probably worst Europe see. the kind the with it wait of of start and and pack I'll Sure. is

So really, as it with Europe. softness some we last really seeing knarlies But out. pointed couple [ph] -- good was we started a we had a even quarter though we are quarter

for I We better. We'll instant little probably think expectation. of is full the high year a the is see, biggest single-digits side still the suspect. platforms our the could do

very think looking the I in and strong reagent good. side we're overall

for the strong see good looking are instruments well. really shift the looking of we any is cycles in of is no But think kind really probably down and and or goes. anything steady Things coming as I part Asia as really she off it's China. especially U.S. there buying

been side on be okay pretty last U.S. but from news biopharma and funding week out expect good with the helping stable steady. out pretty, pretty the academic side year the NIH as in next and So the piece we've I well came should the

than day our think very web the we show. show commentary off very, put We neuroscience came I entire to we leads had had our the search think around last of we more just first I year. strong a in and some and tried engines and

together interest of lot our we've our has booth awful It's creating come an way, platforms, more. all showing long in got all providing brands our Web, up really keeps the the Web now. So a

So double-digits while. which for a that been way a fuel strength U.S. I think the here continuous is the for helping has in

that's kind else. the for shake everything the instant and well of out So, way of side three as the as things regions

good. So, pretty

on, we better could get is where we're probably launch was kind see, it's year. I a to I think to Jim here peg think looking the right at we really be range XX% XX% we'll safe. it [indiscernible] of good the be but If

Puneet Souda

great. Okay,

gene buildout, wanted what's great you a the gene here that for facility some years into kicking cell and from are products and this but to pieces enhance three of still view offering workflow the what the now see is on workflow it that to would cell get therapy product like expectation from two to the On to to you add customers? therapy the to and off

Charles Kummeth

Sure.

So, know cell as to looking we're and workflow you therapy our non-viral forward the gene methodology. with be

now expect a for almost everything clinical method. method. We We'll -- is GMP be viral supplying in proteins that

and So in had ready we'll business we we QX shoot today XXX% getting be proteins. with are a as our to growth

by The We good million that building of for the it in productivity. years of probably level So five proteins easily years we're five It looking expansion $XXX there. factory GMP of just probably to will plus very proteins. capabilities, more we're $XXX itself has get million proteins. than is to take

look the mini that with So editing. like respect with the rest we technology workflow the CDMO beads for gene B-MoGen but kind the from and of there's of a

well will. our with amino We the assay simple AC cell for if than as have analysis you instantiation in technology plex as testing called for imaging both more Casey one platform

strong a out. it's fill We looking told more areas for to workflow. pretty are still all So it

don't all instrument together. have tie think leukapheresis we to it I a

to important. all think, that the reactors I That's try the we're most that together. speak, it box on that relationships into piece to get of the certainly so have are the pulled workflow. to bio course part probably sterile The We box ties collaborate and working critical

very We have we the we have part and than secret of with a strong relationship whole bit have that workflow. a for a more that locally and one weapon of

no for to called they can positioned for Prodots reconstitution in that have alkalize loss we've and within four workflow the five [ph]. environment with We dry our or components with We're of bioreactor sterile bio a actually be activity. able product years proteins a small into shipped had or

really unique is us. to this So

We they have approach it. open are this IP and have when eyes well as wide in preclinical seen and area want we this our in getting customers

have we a to the for think of So else things we whole that nobody will offer have workflow. lot

kind X will in but to bunch three years we're a strategy kind to I protein years think take get of implied point. get then whoever it's we've take now of We're grow to level. hey, that XX and or will going at a to our like which clinicals more you and to But and be going of than been is to that there preclinicals it's to to while able it. thought going it a lead to year to from XX this double two business

taking So years double I it. don't mind five to

Puneet Souda

great, provided, or that That's plans more have just expectation about fiscal the you revenue I designation And sure you wasn't if I and steps squeeze the the and you for what's one that EPI? FDA talk have already could year if Medicare now thanks. for for and next you Exosome breakthrough now around could

Charles Kummeth

Yeah with they've as the come long a submission and we've of list first done laundry questions expected. back

to months to will at be sure, least under we're but But going for it's give a even able So really for a few a for be finalized date year when not it that. FDA.

gets breaks we're them help FDA the directly that So process that stuff through us from and they promise. in and

they helping. So are

what So that. we'll with see happens

for where out of our date will now to We're tests first terms than are be, revenue we're done. figure In what a no right submissions it'll figure in and to longer reach previously to to back out year be worth. for months trying trying that

of but no worth So give it'll millions guarantee. of on potential there's prepared we're number not to that but be a dollars

you've kind accrual promise XX% although XX be then X, it's what we'll of kind had greased future you everything and we're pay get And will kind the run that's get a probably which summer Revenue, of days and to year after think. submitting. a of to and with XX% total of probably timeframe that be we that of XX rate so the going and seen that's full break to and million months we we mean number frame. need about that tests that, that be time at here our go is point to I we're to at to to numbers. going a amount of to guesstimate kind I a million forward even, once XX you CMS December XX ramps, next Going $XX

December out It But don't New a here Xst. plausible last ramp. how more is a and see yet, to to we've New it's we for We of think we'll of the few this in but get how lot certainly about takes months forward how the but from people still we know the takes to years to traction out or the getting time try we're early six really months. best It a like from beast and works it Telus two we longer want nearly won't record. six go us [ph] to see We through anything to just yes, to is hired York all probably for than level and nine long start in finish we be this feed ramps. to only getting of groups so got a new see just for you excited a groove. revenue and there. got three I the thing It's our York still But so another we're months does in whole than we time town, in that taken and to in game it marketing we so this as say execute. talked our will long upgrade We've got hiring. We sales in we're

Puneet Souda

Chuck. thanks Okay,

Operator

Baird. next our take we'll with Catherine Schulte And from question

Catherine Schulte

thanks Hey congrats question the for and the quarter. guys, on

First if and Medicare you retrospective find EPI do that topic. with or when NGS discussions get back you'll think look one payments on your not? those out you'll How's gone

Charles Kummeth

appropriate fair. precedent can You up It you know, feel is back and what for and we it also get just decide law to around or to is don't by they to back to And them rule no we as is farther have more reach. really know. anything what there's problematic we real the no us day There go it. make to

to doubt, thing to trying start there's no no asking people we're fair out data for. want got and remember about this nebulous you what when don't we're where and you're anything and So processes with you and starting with we like pick dispute, out kind unclear position notice practices a sales of

going great we're safe outcomes clean our we point a are processes dispute. a there really have great we So and to where and pick is no and and date so from data where have perfect

it's be figure we a to trying be going we're should months that So at out to worth but all few tests. an think that and six least thousand

generous. I And see. we'll So hope they're

Catherine Schulte

terms quarter of budget calendar a Protein Okay, are assuming you and the have the you pretty comp next for tough quarter year end your and in then stacked upcoming segment in flush Sciences. What's view there? what that on

Charles Kummeth

really of right I of out good. record, is that hearing now not came news mean we're flush. for funding Yeah, a looking the budget forward to kind much looks NIH just it

year So coming we're excited about academia. forward for of this coming

going are But execution. steady us rest one we're good previous it's of a the processes drive as the into pretty see Right, we down easy -- you're this you and is. going year when But to They're we're got We've that's anymore. forward. horribly. it's want staying the be way business be to I for you said I coming it's is don't things We'll to with a execute think a business. -- think As with goes how double-digit last going really quarter and never sustainable tough and This she to be a answer quarter. in anyone let our tough mentioned quarter like my every quarter. all

Catherine Schulte

the one for us China update are an me, last that on year? you're give there you for And just expecting the growth and seeing general full then environment what can from in you

Charles Kummeth

to we're Yeah, trying north for XX%. sure out figure ways be really of at XX% to and

So I be a to fifth budget will there. think XX%. of concluding there. kind The bit pretty we'll be a is year good. flush between of There XX% Things look

trauma anyway. I in we aren't as the drama us around it's impact is steady I of go. have think and big think all the tariff pull that lot a China. though think tariff all behind We still And forwards don't even I you

just penetrated it's and or went school by grew and here our we're that and R&D up by to led more less lab. know with of citizens it's systems in led under Chinese very brands So them U.S. institutions, that the hundreds are

to we're It So we're very ago now the really. And a over I real solid very becoming so there. was years up people here been just it's stable all it. We're when got I in dozen joined day and China. a over six plus company since XXX

I a last joined groups were spoke I RMD and to only our too comment a dozen that crossed are that, hard. a bilingual. and people of hurdle. hire ones for it's grab the that HR our head the talent people local now week, company And we've to million trying all multinational XXish that's made dollars great The when some and English that we're past

from in most culture platforms, great and our board the -- They've speak they grown these coming stars by been English up are We multinationals. somebody and they've only are hiring they're trained who of the we're rock on our our days people not and else of synergies around subsidy the trying come our instill to every the we want under growth, and have to world. penetration, they EPI see, because are

Catherine Schulte

Thank you. Great.

Operator

next question our Craig-Hallum Nowak with Capital Group. take We'll from Alex

Unidentified Analyst

protein to another has our today. and built researchers, on gene existing science for is morning can life in a huge good another the move is This Will Bio-Techne you that how can new grade GMP Chuck way questions. resources catalog Chuck leverage the for needs therapy thanks area, leverage products products and stool existing the and or these you into businesses as leg and for emerging the production of actually Jim, taking the added growth area? Alex be this make resources to successful into you Thanks. to pieces you ask of to cell question this Great,

Charles Kummeth

catalog need probably because Well, very we we're don't talking about a XX products. big

we now growth problem know GMP even right we the up we're for our in you XXX% research, as set So business a the in world. though here protein are research leader our experienced

proteins. just products thousands of have and we We thousands have of thousands and

are wide deep and we a mile fundamental issue. spread that's and so inch And the

because see amazing but for love type We it's what you qualified through, Alright, CDMO. so here operate all I will make really for be make hear. they more is we but batches enough us, they got with big have production it they've amazing can't they what a really GMP not to to love environment we a been of quality processes

right, building And GMP for, basically we're the making are generation therapies which that to and their out, and it food next be is proteins so using what are we the for for yields. -- we looking this bought world's the these improve it eating, cell which factory, will

ones is kind It's first and and look of It's the ILX a You make discovered spec backwards protein of one difficult discovered to make. this the everybody can ILX. not company. by

we're more science the going us as best ILXX, will be with the Looking as forward much to with position proteins and you quality the the ILXX we'll start activity. buy we yields gets that the make proteins. highest as moving complicated We're and make others supplier towards at highest looking ones best the looking are complicated more of stronger we're ILX, choice the and at think that

and the factory. GMP really we of more our So for it's won't world a number way the manufacturer It's because of set. not protein work proteins therapies. It science future us. large comes think at are kind -- building we this It's a in select one the straight solution, catalog cell that's the why of be it kind

yield do game. the be with kind is their of about provide with you activity, more kind ILXX going and that's the your protein kind what there an of of cell So to what what lab of your get therapies name much what customers of flavor quality,

Unidentified Analyst

on appreciate then the it, just and the [ph] And pipeline what's launches color. there, LICA interesting. tests ACD some partnerships with if the the on update That's just ACD for the thanks, timing could in next and Got you talk thanks?

Charles Kummeth

talk they've to about used against we so us more guide pipeline the of and Yeah, kind that.

of with business it. lot half test is quite like, strong things dozen There's prioritizing a The very them of -- So they a working are they're things, have lot HPV a growth, how big we're happy really a they're double-digit unmet they're the needs. very on. current smaller well. orphan growing It's good

has chain helped priority the think with Fisher, lot. food management led new and to a on industry for us well. organization Kelderman team from up I Thermo so our in Kim think trying running by more Genomics comes so strong I He very to a the So moving helped lot worked has speak get relationships Danner he's that's

more town; a platform. I interested of we're So Roche on not with and them on think technology the in work things working and with Ventana, a multiple only platforms. be on us that things. more ubiquitous we're looking kit game can They're forward also is instrumentation working to in It's number hopefully

all than and we're far working RUO it now us right the is the so, than based XX% So still an much It's business that. still and more five years less and it'll so good. diagnostic of give years it's and you there largely issues so side five be RNAscope

Unidentified Analyst

to based for then And question, EPI, as kit just have a more Thanks. updated Dx or the do Exosome as well thanks. any roll other in final great, Okay, kick you format? one lab tests on LCD plans congrats have out either I a this product

Charles Kummeth

private work Well, and territory blood for now to to we'll test rate is point. -- But lot uncharted credibility give and that'll about validated a this more with have of payers someday around to need status us and create the on plenty we breakthrough the real on go lot at for the breast. got FDA we're And right and ready get studies taking it somebody us things lung but a who more wants remember go kick the of or indication to also and us starting bladder any do we that now be the kidney don't working in to could there not such. and us out freedom with plus to with yet side worry see that. to It for clinical rejection patients we've help

we right version it kitable after a of go platform anybody addressing strong So to that have do. this to don't got pipeline we've with now. There enough is

Unidentified Analyst

thank Great, you.

Operator

And you check we'll mute unable question from function. Knight our Janney. from next We're hear your please take Paul to

Paul Knight

Hey Chuck, Knight. Paul

Charles Kummeth

Hey how you doing. are Paul,

Paul Knight

timing about investment be can but this additional capacity it specifically could add once footprint also your GMP made? around a expansion will Good, production is facility you the you where initial talk

Charles Kummeth

Greenfield that Yeah XX,XXX but answer and square from way an the as it's awesome one. for doing so We reason on a us. laid facility else, was for was expand it's bought a It it I mentioned in we to foot a We proper. some building bought that somewhere St a the it facility. bought year out of absolute earlier we Paul that main save could

really a of and It to it plenty still bio not Phase piping, and need utilized. got processing ready to at million we know. right. our all in capacity expansion stuff that that as The there factory is of in million So which to just X the room what pharma of with most expensive rooms, rooms, $XXX small to reactors, is sterile go to it the roughly is. there's XXX factory, easily is the clean with kind large with And looks money was the it you goals. is the stuff the fill the out It's like of we put on XX,XXX today's a if pricing

work out other stuff need can antibodies wise looking there, we're to. if other will on things there's can we so build at also possibly there. we there's is room we too, some some be We the doing but on There land reagents possibly site

really another So we to don't worry us time. one for have quite this buying big thing for and be some about could

Paul Knight

then your through as And is are going XXXX your think about talk up, protein you well? you could simple pull where penetration in market placements, you regarding

Charles Kummeth

we are Well penetration less feel. XX% we than

been the knocking it quarter. park after western quarter the We it have being simple going matter no whatever that on what's seen on or with instruments has just

and more under think crossed penetrated. we than very still have that chasm it's I because it's

We are that fast, this so walked are away us It's process lot the pharma the customers well. a as because Western reliable. of in it's bringing from back again blot with you so a a have fold into big going works so and back

XX% again you it's at expanding less of than actually imagers XXXX we're compare to good as roughly, it think. is the but look there So imagers the number I in if a it's what world. installed out market are I

go. we long So think there's way a to

still between academia. in good and are split We biopharma

I we're years really do not our leaving they we're standard learned how that's Western few the this in taught college with methodology is a that. becomes a people how When think we'll know is until is and off and done this see to job blots. that done from we schools

Paul Knight

Okay, thank you.

Charles Kummeth

on only Paul. blot the the with this platform It's and no we out nothing competition there see automated have horizon. We Western

Jim Hippel

antibody to probes. to your keep have adding You with library the

Paul Knight

in mean You of terms Western…

Charles Kummeth

we're adding right. so always Yeah,

add split each assays, every and we between is year. it So antibodies, year, roughly XXXX up proteins a and

newest, new been look company the we leader We've we're and to ELIZA make So people for to hardest out bio always proteins. year. still the the ELIZAs active every crank

more more envelope the lot And especially standard. category another supply to extend becomes antibodies trying multiplexing pushing we assay of as are multiplexing a through We a so Novus. and we're that

the catalog as And but to and it's provider We XXX,XXX. going the think quite applications you the for XX,XXX but have we're over flow a growth antibodies it all ourselves in whatever we now from western and and world. over in we're largest We catalogue in enjoying to different make our know in largest we're top we've We're few not continue. quarters and five. the to double-digit seen come

Paul Knight

Thank you.

Operator

time. further concluding no conference remarks. I any Kummeth back questions at the to have to We would Chuck like this turn over for

Charles Kummeth

companies out other have ones we'll Clair have in for David all tomorrow of you. but around Well next as reach you all to online quarter we're analysts move day and back more analysts rest and so you you today that here Thank the and or with calls our one other than if other enjoyed that'll your check coming But few in the of from questions a good. quarter. expecting be questions on next two different we're we've and again

Operator

again that appreciate And today. does ladies We your once participation gentlemen and conference. today's conclude

Bio-Techne (TECH) 29 Oct 192020 Q1 Earnings call transcript