This is the Conference Operator. Welcome and thank you for joining the DiaSorin H1 2025 Results Conference call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Carlo Rosa, CEO of DiaSorin. Please go ahead, sir.
Thank you, operator. Ladies and gentlemen, good afternoon and welcome to the H1 First Half Results Conference call. As usual, I'm going to give some general comments on the business, and then Mr. Pedron, our CFO, is going to take you through the numbers. Quarter one was a solid quarter for DiaSorin in terms of top-line growth and EBITDA margins. Quarter two revenues ex-COVID growth 7% in line with the expectation, making H1 2025 plus 8%. Quarter two, EBITDA margin 36%. H1, EBITDA 35%. In line with what we expect to achieve by year-end, and Mr. Pedron will then comment on the fact that typically on our EBITDA, we have a seasonality and a difference between H1 and H2. Overall, we confirm guidance of 2025. As usual, I'm going to comment on the business by all the different business lines. I'm starting from Immuno diagnostics.
Immuno diagnostics grew 8% in quarter two and in half one, in line with expectations and confirming the strong positive trends. There were clear business in all the geographies except for China. I'm going to make a comment about China. If you consider the Immuno diagnostics growth ex-China specs, it would have been 10% both in quarter two and in H1. The franchise, as we have seen in the past, continues to deliver growth according to the different programs that we discussed many times. If we now go by geography in Immuno diagnostics, North America, which is one of the most relevant geographies for DiaSorin for Immuno, grew 14% in the quarter, and the growth is driven by the continued success of our U.S. hospital strategy.
We have a target of reaching adding 100 new hospitals by the end of the year, and we are tracking perfectly compared to the target. Clearly, as we have discussed many times, this is due to our unique menu of specialties that makes LIAISON XL, our platform, very suitable for this market. When it comes to Europe, good performance plus 6% in quarter two, driven by the success of the LIAISON platform. As we discussed many times, in this geography, we are very much penetrated, so our results rely on the fact that we keep adding products to our existing install base of LIAISON platforms. Europe overall continues to deliver high, mid-to-high single digits, which is what we expect this geography to do.
When it comes to the rest of the world, we had positive performance in the quarter despite political tensions in some countries, and the good result has been driven by strong growth in direct markets, mainly Brazil, Mexico, and Australia. In those geographies, we serve through local distributors. Last but not least, I would like to discuss China. China, as we have discussed now since almost two years, is becoming a very difficult market to operate. We experienced, in the quarter, a double-digit decrease due to the already announced and expected impact on VBP. The market, as I said, is difficult. I think that a few other companies already reported and did comment on what's going on in China, so I don't think we need to spend more time.
For DiaSorin, China represents less than 5% of the revenue, so even if we are struggling in this market, it does not impact the overall company performance. If we look by technology, so by product, QuantiFERON -TB, together with our stool panel, continues to drive the growth of the business both in Europe and in the U.S. We are launching this product also in secondary geographies, so we expect that when we get to saturation of the primary markets, secondary markets will help us out to continue to grow these franchises. What I think is fairly remarkable is that also established product lines like Hepatitis tests or even Vitamin D are experiencing growth again. Especially Vitamin D is very interesting.
We've been losing Vitamin D for many years, and now we reach a position where we are selling this product in the hospital market, where together with the rest of the menu, we can bundle it, we can secure it, and we clearly enjoy the testing volume increase for this parameter, which is actually happening across the globe. MeMed, we continue to see positive signs of acceleration in North America, and we have reached 40 active customers by the end of H1. I remind everybody that we gave a target of 75 new customers by year-end, so we are well in the position to deliver this target by year-end. What I think is worth noting is that we recently signed a very relevant contract in the U.S. It is a million-dollar business.
It's the first time that we were able to sign for this as a clinical group that decided to use now the MeMed BV across sites and being part of the medical practice. I'm very positive about the future of this. Now, let's move to Molecular Diagnostics. With Molecular Diagnostics, I would like to point out that we need to exclude, in order to fairly compare 2025 with 2024, we need to exclude the ARIES contribution. The ARIES contribution, which was EUR 5.5 million in 2024. ARIES, I remind everybody, is a Luminex legacy platform that we decided to discontinue last year. We had sales through H1, but we didn't have anything this year. If we look at the Molecular Diagnostics ex-COVID performance in Q2, excluding ARIES, growth was 8%. Sorry, I said in Q1, but here it was talking about Q2. In Q2, 2025 growth, excluding ARIES, is 8%.
If we look at the VERIGENE and LIAISON PLEX platforms together, what we call our multiplex syndromic business, the franchise in quarter two grew 11% and 18% in H1 2025. Clearly, after the strong start in quarter one, where we had a 25% growth, there is an expected lower pace in the second quarter because the LIAISON PLEX, the panel we launched, is a respiratory that clearly in Q2 and Q3 is not carrying strong demand. It is related to the respiratory season, so we expect an acceleration of growth coming from end of Q3 heading to Q4, as it always happens every year. When it comes to the LIAISON PLEX, we now have completed our blood panel.
Now we have a full blood panel approved in the U.S., which is allowing us to start quoting in this market that for us is very relevant because the legacy VERIGENE 1 platform was still holding a good market share in this hospital segment. For us, it's either a defensive panel plus is allowing us the ability to clearly increase pricing in this segment, moving from one category to the other, plus is giving credibility to the LIAISON PLEX platform. Now we have four different panels that can be used. It is speaking about the ability of the company to deliver on the availability on additional menu on this platform. Clearly, the next one to come that will complete our phase one offering is the gastrointestinal panel that we will submit by the end of 2025.
In Q4, we expect to submit the product in line with expectations and get it approved beginning of next year. If we move then to the Molecular Diagnostics, the other segment, which we call targeted MDX, this is the DiaSorin MDX platform. The business grew 10% in quarter two and 12% in H1 2025. The non-respiratory panel, they're growing 40%. They represent half of the business, more or less. They grew 40% thanks to, again, the specialty positioning we've been discussing several times. One of the most successful assets we have is the Candida auris, where we are the only one in the market and it is getting a ton of traction in the U.S. market. Respiratory panels in the second quarter decreased due to a softer tail of the flu season versus previous year.
Also, let's remind ourselves that in this case, we are comparing to a Bordetella outbreak last year, which did not repeat this year and is affecting comparison between respiratory Q2 versus respiratory Q2 last year. We are submitting as a defensive posture in this platform a new four-plex panel for QA, QB, COVID, everything, to get to par with the competition. We expect to have its approval next year. For the next flu season in 2026, we're also in the MDX platform, and we're going to have the complete offer. When it comes to the LIAISON NES, which is our ClearWave platform, we have filed the ABCR panel and applied for a waiver in July 2025 in line with the expectation of the 2023 Investor Day. We expect the launch of the system in H1 next year, so we'll be able to participate with the 2026 flu season.
Next panel to come currently under development, Initiative Clinical Studies Group Extra, that again, we believe is going to be available next year. We're also building momentum on the LIAISON. Last but not least is the LPG, the licensed technology. We had a very good H1. It grew 10% in H1 versus previous year, 7% in quarter two. I need to draw your attention to the results because if you look at the licensed technology, half of the business is diagnostic, half of the business is life science. The diagnostic portion is doing well because we are supplying clearly companies that do grow mid to high single digits in this space. When it comes to the life science, clearly, we are suffering the results of what all our business partners are reporting.
Softening of the instrument revenues, part of the revenues we have is related to instruments that we make and we sell to the business partners that then sell it to the research community. Although what is very interesting and is working for us so far is that reagent revenues in life science are still growing. Clearly, not as the past, but as if there has been a repositioning of the limited funds these days of researchers more on reagents than CapEx, which makes sense. In the H1, very good result. We expect some softening clearly in H2, but we really need to understand how this volatile market will be performing in 2025, going into 2026. Other initiatives that I would like to comment are two. One is the closure of our German manufacturing site, as outlined during our last Investor Day in 2023.
We remain committed to driving operational efficiency across the group. This is because we foresee that the pricing environment in this space is not keen to improve. It can only improve if companies can be innovative and launching specialty products like we continue to do. For the products on the market, there is always, historically, in this space, there has been price pressure that will continue. Therefore, we continue to do whatever we can to improve our profitability on the manufacturing side. In this very specific case, we are concentrating fundamentally our manufacturing capacity in two sites, one in Italy, one in the U.S., one to serve globally our Immuno XL franchise, and one that is serving primarily the U.S. market. This is why we're not so exposed to tariffs these days. We've invested in capacity and automation in these sites.
After the last review, it did not make sense to continue to manufacture in Germany. We are in current negotiation, and we are going to treat fairly our employees that have been working with the company for many years, delivering great results. I expect that by next year, closure will happen and products will be transferred to Italy. The last remark I would like to make is to do with that we have a collaboration that I think is very interesting with Gilead. This was announced last year about the Hepatitis B virus. You know, Gilead is trying to get a CARE and new drug approved in the U.S. Together with Gilead, we are bringing an assay that will be used in the U.S. to screen for those patients that are candidates for the drug. We have submitted to the FDA. We responded to the last set of questions.
We expect that this assay will be approved in the next quarters or so, and that clearly will help and support our differentiation in the U.S. market, continuing to drive our Hepatitis franchise growth. Now, I'm done with my comments. I'm going to pass the microphone to Mr. Pedron, and then I'm going to take questions.
Thank you, Carlo. Good morning. Good afternoon, everyone. Thank you for joining DiaSorin H1 2025 Earnings Call and for your continued interest in our company. Over the next few minutes, I will walk you through DiaSorin's financial performance for the first half of the year. Following my remarks, I will open the line for the Q&A session. 2025 year-to-date revenues reached EUR 619 million, up 5% or EUR 30 million compared to the same period of last year. This growth was achieved despite the expected decline in COVID sales, which were down EUR 7 million, and the EUR 7 million effect headwind, primarily due to the depreciation of the U.S. dollar against the euro, as we anticipated during our previous earnings calls.
On that note, let me please remind you that on a full-year basis, every 1 cent movement in the USD/euro exchange rate typically impacts DiaSorin revenues by approximately EUR 6 - EUR 8 million and adjusted EBITDA by EUR 2 - EUR 3 million. Given that the average USD/euro exchange rate in H2 last year was at 1.08, I believe it's fair to expect an additional effect headwind in the second half of 2025. Excluding COVID at a constant exchange rate, we saw our core business grow by 8% in the first six months of 2025, as said in line with full-year guidance. Carlo already covered all the performance by geography and the technologies, so I'm not going to comment more.
In the second quarter, revenues excluding COVID at constant exchange rate grew by 7% or more or less EUR 19 million, as we said and as we heard, in spite of the discontinuation of the ARIES platform in 2024. As mentioned earlier, we faced a significant foreign exchange headwind in the quarter, amounting to roughly EUR 11 million. These, combined with the expected decline in COVID-related revenues, resulted in a shy reported revenue growth of 2% at current exchange rates. Gross profit for the first half of 2025 reached EUR 406 million, representing 60% of total revenues. This marks an improvement of EUR 60 million or 4% compared to the same period of last year.
In Q2 specifically, the gross margin remains stable at 66% of revenues, in line with Q2 2024 and consistent with the level we have seen over the past few quarters, in spite of the fact that we started to show some impact from the tariffs of moving goods, importing goods into the U.S. Adjusted operating expenses for the first half of 2025 totaled EUR 232 million, representing a 1% increase year- over- year, or 2% at constant exchange rate. As a percentage of revenues, operating expenses declined to 37%, down from 39% in H1 2024. This improvement in operating leverage is a key driver of our margin expansion, as we have consistently emphasized in prior earnings calls and during our capital market days. Adjusted other operating expenses for the first half of 2025 were negative EUR 6 million, EUR 1 million better than the same period in 2024.
I'd also like to address the reported other operating expenses. Each in the quarter has been affected by the initiation of the vestige and the commissioning plan for our Immunodiagnostics manufacturing site in Germany, as we just heard, which we expect to complete by the end of 2026. This initiative, as we said, is aligned with the ongoing strategy to optimize our global manufacturing footprint, similar to the actions we've taken in the past, such as the divestitures of our Irish and South African facilities. This affects our continued efforts to adapt to the evolving macroeconomic conditions and enhance our long-term competitiveness.
The one-off charge recorded in Q2 of about EUR 8 million reflects the first part of this program, and we expect additional EUR 6 - EUR 8 million to be booked by the end of 2026 to eventually cover the full scope of these initiatives, including, among others, the private commissioning costs, project-related expenses, fixed adjusted rate costs, and so on and so forth. We anticipate a positive EBITDA impact of approximately EUR 6 - EUR 8 million annualized once the plan is fully implemented. As said, this is one of the levers supporting our path toward improved profitability, targeting the EBITDA margin outlined during the last capital market days. The results of these dynamics, adjusted EBITDA for the first half of 2025, reached EUR 167 million, representing 27% of revenues. These reflect an increase of EUR 14 million or 9% compared to the same period of last year.
Adjusted interest expenses for the first half of this year were just under EUR 1 million, compared to an income of EUR 2 million in the same period of 2024. This shift was driven by lower yields on our cash investments, reflecting the decline in interest rates. The adjusted tax rate increased from 23% - 25%, mainly due to the termination of the patent box regime for our Italian legal entity. As previously discussed during our last capital market day, this measure was not renewed by the Italian tax authorities, and the resulting impact on our effective tax rate was therefore anticipated. On a separate note, we do not expect any material impact on our tax rate from the recently approved so-called One Big Beautiful tax bill in the U.S. Year-to-date adjusted net income totaled EUR 125 million, representing 25%, 20% of revenues.
This marks an increase of EUR 5 million or 4% compared to 2024. Lastly, H1 adjusted EBITDA reached EUR 114 million, exceeding prior year by EUR 16 million or 8% at current exchange rate and by 10% at constant exchange rate. The EBITDA margin of 35%, both at current and constant exchange rate, is better than the 34% we recorded in 2024. At constant effects, this EBITDA margin is almost 36%, benefiting from the favorable calendarization of LPG sales, typically associated with higher margins, and from disciplined cost management. As we observed last year, we anticipate higher operating expenses in the second half of the year, driven by our summer salary review and by the timing of sourcing discretionary costs. The improvement in our margin is in line with the guidance and the path to increase profitability we've discussed many times in the past. Let me now turn to our net financial position.
We closed Q2 2025 with a net debt of EUR 611 million, an increase of EUR 66 million compared to 2024 year-end. This variance is mainly the result of two key factors. On one end, we generated a solid free cash flow of almost EUR 85 million in H1. On the other end, this was more than offset by EUR 97 million debts related to payments owed to shareholders who exercised their withdrawal rights following the recent adoption of the enhanced voting rights mechanism. We have to account for EUR 63 million dividends paid annually to our shareholders. Before we move on, let me briefly update you on the ongoing Italian payback situation. It looks like we almost get to the final episode. The government-mandated reimbursement mechanism tied to a regional overspending on medical devices covered by the Italian National Health Service.
Just a few days ago, as part of the decree enacted at the end of June, the Italian government introduced a settlement framework for outstanding payback obligations related to the years from 2015 - 2018. Under this new provision, companies can resolve ongoing legal disputes by paying 25% of the original requested amounts, a significant reduction from the 48% we discussed in previous calls. Once the payment is made, no further legal or administrative actions can be pursued by the authorities. As you may recall, we have built a provision on our balance sheet over the past few years to cover this risk. As a result, this legal development will have no impact on our P&L. However, we do expect a cash outflow of more or less EUR 5 million.
Given the fact that these expenses will be deductible from a tax perspective, the net cash impact will be slightly above EUR 3 million. Worth noting that the decree does not address payback obligations for the years beyond 2018, but we believe our current provisions remain adequate to cover any future exposures. Let me now conclude my remarks by sharing our outlook for full year 2025, which remains consistent with the guidance we confirmed during our Q1 earnings call. As always, figures are at constant exchange rate, assuming the USD euro exchange rate of 1.08 for 2024 as a reference. We expect revenues excluding COVID to grow by approximately 8%, and we also confirm our guidance for an adjusted EBITDA margin of around 34%.
Please note that our guidance already incorporates the anticipated impact of recently produced tariffs across the geographies in which we do operate, but mainly the U.S., while we are exporting mainly to the U.S. While we acknowledge that the broader macroeconomic environment remains fluid, and while we wait for further clarity following the recently announced trade agreement between the European Union and the U.S. administration, based on the information currently available and considering the mitigation actions already implemented or underway, we do not expect a material impact on our profitability in 2025. We will continue to closely monitor developments in this evolving situation and will keep you informed as new information becomes available. With that, I now turn the line to the operator to begin the Q&A session. Thank you.
Thank you. This is the Chorus Call conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press the star and one on their touch-tone telephone. To remove yourself from the question queue, please press the star and two. We kindly ask you to pick up your phone when asking questions. Anyone who has a question may press the star and one at this time. The first question is from Aisyah Noor with Morgan Stanley. Please go ahead.
Hi. Good afternoon. Thanks for taking my question. My first one is on China. Your competitor was talking about a DRG or debundling dynamic that's happening and impacting panel-based testing in immunoassays. Have you heard about this, and are your products within the scope of this debundling plan? My second question is for Piergiorgio on the margins. Could you explain a bit why the gross margin was down 30 basis points, flat year- on- year, I guess, but the EBITDA margin is up 100 basis points? It's 35%. Could this reflect a higher mix of partnership revenues in immuno or any other mix dynamics we should be aware about? Thank you.
Yes. I'll take the question about China. Yes, I know what DRG is. I think that we heard about it. I believe that this confirms what China is trying to address, which is fundamentally cutting costs. Right? DRG together with VBP are two ways to do it. Interestingly enough, this has nothing to do with foreign companies per se. This is actually addressing the market and is, at the same time, hitting the Chinese local players and the international companies. To me, it's nothing new under the sun. Truth of the matter is that China will become a less profitable market for everybody because of driving less consumption and through these DRG systems and pushing down the price through the VBP. That doesn't mean that China is not an interesting market simply by sheer size.
It's that I believe the strategy for China is not to rely on existing meat and products, but to focus the strategy of the company into very, very specific specialty products that would help differentiate and the clinical value of which is clearly leaving these products outside the scope of VBP and, at the same token, outside the pressure of the DRG. As far as DiaSorin is concerned, we discussed about this a few times. We are going through registration of the TB products. There is a great TB market in China, and we expect these products to be available starting from next year. All the gastroenteric line that is not registered for us and where there is no active competition is also what is under the DiaSorin focus today. When it comes for the margin question, please.
Hey Aisyah, thanks for the question. The margins in the first half of the year grew more or less at the same pace as the top line in spite of the impact of tariffs, just short of EUR 1.5 million. Despite the fact that I'm talking about China, our manufacturing plant in China is now fully operative, which means that in our cost of goods sold, we are expensing the cost of the manufacturing site itself. During 2024, the site was not operative yet, so we could capitalize some of those costs. By the way, let me share with you all that we got the registration for the first two products from the Chinese FDA, which is JetNews, and from the manufacturing of our XL in China. Considering this impact, I believe overall the gross margin number is a number we're happy with. It's in line with our budget.
Why, in spite of having a similar margin, is our EBITDA richer in terms of marginality? It all mostly comes from operating leverages. As you might see from our P&L, the ratio of operating expenses over revenues moved from 39% in 2024 to 37% in 2025. The EBITDA margin expansion is mainly coming from operating leverages. This is the short answer.
Thank you. Just to quickly follow up on that response, Piergiorgio, how are you thinking about the margin development for the second half, given you are now a bit ahead of your full-year target of 34%?
I believe in the second half, the gross margin will not change materially from the 66%. If anything, we'll decrease it a little bit because we are expecting more molecular sales and less LPG sales. Carlo explained why it's fair to expect that in H2 LPG sales should not go at the same pace we saw in H1. LPG sales for consumables with royalties are richer in margins than molecular sales. Because of the product mix, I expect H2 to be a little bit, let me say, lower in terms of gross margin. At the same time, as we've seen last year, I'm expecting an increase in OpEx because always in our company, we have a salary review cycle across the whole corporation in July, which means we should expect a higher cost of labor in H2, which is going to increase OpEx in absolute value H2 - H1.
Please consider that you will save 60-65% of our OpEx or labor costs, and that's why it's pretty intuitive to understand why overall OpEx is going to increase. Since we closed H1 at 35%, I'm expecting overall an EBITDA, and allow me some flexibility, an EBITDA margin in H2 around 33%, which should allow us to close the year around 34% at constant exchange rate, which is our guidance for the full year.
Perfect. Thank you very much.
Thank you.
The next question is from Hugo Solvet with BNP Paribas. Please go ahead.
Hi, guys. Thanks for taking my questions. I got three, please. First two on MeMed. Can you hear me okay?
Yes, we can, Hugo.
Okay. First two on MeMed. First, the EUR 1 million contract you mentioned, does this represent some commitment and how long will it last? Second, on MeMed, they announced last week a fingerstick blood test. Piergiorgio, is this technological development falling in the scope of the non-exclusive partnership that you have with them? Lastly, Piergiorgio, sorry if I did that, but on the discontinuation of the Siemens ELISA business, can you share, of course, the revenue loss that will be associated with the discontinuation and also the savings for the EUR 15 million one-off cost? Thank you.
Okay. MeMed EUR 1 million. I pointed it out because it's a contract that is covering a healthcare system where you have the core facility, you have the clinic. It shows that when a healthcare system is looking at implementing these new tools, it's a significant business. Okay? So far, we had wins in individual hospitals. Now this is the first time we are really getting a full system to buy the hub and spoke, the hub and spoke provisioning of this pricing. This is why I'm saying with this kind of account, and there are hundreds of health systems in the U.S., we really expect that now the size of the business that we're going to be gaining is more significant than in the past.
On the fingerprint, I don't know what they announced, but it's not, honestly, the contractual relationship with us and MeMed is confidential, so I don't want to comment on that. On the ARIES, it's not ELISA, it's the ARIES, it's the all-molecular platform of Luminex. The contribution in H1 was EUR 5.5 million that were sold last year while we were closing the plant of the manufacturing equipment. This is clearly by year-end that was finished, and now we have zero starting from 2025. The last comment was?
I believe it was on the discontinuation of our manufacturing site in Germany. I believe, Hugo, to change some confusion, it's nothing to do with Siemens ELISA, if that's what you refer to, right? I believe you said Siemens ELISA, correct?
Yeah, I just put my butt in. Thank you.
No issues. Let me just explain. We did buy back in the past. It was a 2017 ELISA business from Siemens Healthineers, but we never manufactured it. Nothing to do with that. I understand the confusion can come from the fact that we are diverting, we are acting in the diverting from our manufacturing site in Germany, and that is an immunoclear manufacturing site. We are moving production quickly, as Carlo said, and we are not expecting any loss of revenues. It's a clear product. We will keep on serving customers during the transition phase, no revenue impact. The phasing, I believe you asked me of the phasing of the one-off cost. I said EUR 8 million now. I'm expecting into two, potentially a couple of more million in the second part of the year, EUR 2-3 million. The remainder EUR 2-4 million are going to be booked in 2026.
We expect to be done with this program by the end of 2026.
Thank you.
Thank you.
The next question is from Jan Koch with Deutsche Bank. Please go ahead.
Good evening. Thanks for taking my questions. I also have three. The first one is on your molecular business. I was positively surprised that you grew by 11% in the automatic MDX business. Could you speak a bit about the drivers behind this growth? Was that driven by your blood panels, or did your customers already have some stock for the upcoming flu season? Secondly, on licensed technologies, you mentioned that you expect a softening in H2 and that we shouldn't expect the same growth rate as in H1. Are you projecting a decline in revenue in H2, considering that you're trading meaningfully above your full-year outlook in that business? Lastly, on pricing in relation to tariffs, you seem to be better positioned than some other diagnostic companies when it comes to tariffs. Does this allow you to realize positive pricing effects that could support your margins down the road?
I will take the initial from the last. When it comes to tariffs and actually license tariffs, honestly, we don't know yet because we don't want to take a position which is unique to DiaSorin. Customers these days in the U.S. are very sensitive to tariffs. The administration is very sensitive to tariffs. For DiaSorin, as said, fortunately, the impact is relatively small. If the whole industry decides that they want to pursue a price increase to cover tariffs, we are going to follow through. If the industry decides that this is not the case, we're not going to do it. I'm not so concerned. As you said, first, if you want to do it, we can do it because we're specialists. Second, I'm not so concerned because of the entity of the amount of what we have.
LPG, yes, certainly, if you do the market, you would expect a decline to happen in the following quarters. As said, I think that we need to really wait and see how the situation is moving, what happens to the next. Certainly, mathematically, if we want to year-end, we project 2% to 3% growth, then we're going to have an H2, which should be lower than H1. On the molecular, 11%, no, that is not a stock issue. It has to do with the fact that we continue to close accounts, set up systems, and we are actually getting ready for the coming flu season. Typically, customers stock up in quarter three for the season, not in quarter two.
Great. Thank you.
Thank you.
The next question is from Dylan van Haaften with Stifel. Please go ahead.
I just want to be back to you guys. Thanks for taking my questions. Just one follow-up, on Dietzenbach. If I look at, could you maybe just highlight what basically the gross margin differences are between the two facilities? I have a follow-up question on the measles ASR that you guys announced. I know it's early days, but is this one of the ways that you guys are positioning towards, let's say, let's call it like a pro-inspection policy happening in the U.S.? Do you see similar opportunities to capitalize on, and should we be thinking of this in broader terms? Thanks.
Let me start from the measles question. We typically use, we have a very, very large book of business of ASR, and we always use the ASR as a way to probe the market. In this case, it would be difficult to comment on pro-inspection in the U.S. Certainly, today there are, in certain states, a raising number of, I mean, we all read newspapers. Labs are set up, are using ASR, and they set up their own LPG because there are no assays currently approved. Today, we have seen that a certain number of accounts are setting these assays up. In terms of what is going to happen, we really don't know. Especially with measles, to be honest with you, I hope that we're not going to be selling this product because otherwise the problem would be a very severe one.
When it comes to Dietzenbach, I don't think that you should be looking at this in terms of percentages. We should be really looking at this like we continued in throughout our history. We've always been, even with very hefty margin because we need to have made that 30%, 35%, 36% of the size as a credit dividend industry. We continue to push for operational excellence. In this very specific case, we do have a capacity in our, we built a capacity for future expansion in our Italian site, fully automated. Germany is already partially servicing our Italian site. We came to the conclusion that it would not make sense to make investments, more investment in Germany, but to consolidate everything in a site that was able to get all the volume at a very competitive cost. That was the decision.
This is not one of the situations like ARIES where we kill a technology. We are transferring existing products, cleanup products from one site to the other one, and we clearly continue to provide these products to other customers. This is why we don't plan to see any effect on revenues if the margin improvements.
Perfect. Thank you very much.
The next question is from Natalia Webster with RBC Capital Markets. Please go ahead.
Hi. Thanks for taking my questions. I have three, please. The first one's on PLEX. Appreciate Q2 and Q3 have been really lower in terms of demand, but are you able to provide some more color around the demand you're seeing for the PLEX and the PLEX concept in general, how you're progressing towards the 150 active customers by year-end and the EUR 15 million of incremental revenue? If you're seeing an increase in interest from customers now that you have the three blood culture panels, are there some customers in the pipeline that are still holding off until you have the TI panels too? My second question is on China. If you could just confirm if the double-digit declines you saw in Q2 are in line with your expectations for the around EUR 4 - EUR 5 million VBP headwind you previously guided to on an annualized basis?
My third question is if you're able to give us any updates on Lyme Detect and any feedback you have from the FDA there. Thank you.
Okay. Again, I started last. Lyme Detect, we are in discussions with the agency when it comes to the clinical requirements on this product, which is a very innovative product. I don't have any update at this moment on Lyme Detect. When it comes to China specs, yes, EUR 4 - EUR 5 million is what we have disclosed, and this is what we expect. When it comes to the first question, which has to do with PLEX concept, yes, we continue on our development, on our sale process of placing systems in the U.S. We have a combination of some large commercial labs and hospital markets, and we are in line with our expectations in terms of the number of accounts that we want to sign by year-end.
I believe that the good news is that we signed up recently a very large commercial lab that is going to be using our platform, and the deployment of systems will start in quarter three. It could be all active in quarter four. That's good news about this platform. When it comes to PLEX, I think that we continue to educate the market on the concept that full panel is clinically not necessary. The PLEX concept today is adopted in two different ways. One is the traditional way that you explain with the so-called up to one basic panel of seven plus credits, and the other one is the adoption of different mini panels that the different customers, depending on their own population, decide to apply. What we are discovering is that providing a full versatility to the system to customers, because again, we never ever recommend a panel.
We sell one basic panel of seven, and then they build on it. We see that customers are really using for respiratory disease technologies in different ways. What we are also thinking from what we learned so far is that, and again, I go to the GI. GI is a very interesting panel because there, the amount of mini panels that you can imagine is very much more than a respiratory. As we discussed in the past, not only do you have seasonal, you have a traveler panel. You have an elderly panel. You have different mini panels that you can set up to serve the different population that typically a healthcare system serves.
It is certainly, I believe, one of the analysts wrote a piece saying that they are talking to customers, and customers are saying that PLEX is very interesting, but it requires some thought in understanding how to apply. That is certainly the case. This is the competitive advantage. Otherwise, we would have the fourth box on the market, the same as pretty much all the incumbents are already offering. That doesn't honestly surprise me. Actually, it's what I expect to see. They use our technology differently than others. They see it as different, and therefore they buy from DiaSorin rather than from some of the incumbents.
Great. Thanks.
The next question is from Kavya Deshpande with UBS. Please go ahead.
Hi, Carlo. Hi, Gigi. Thanks for taking my question. I just wanted to ask about North America immuno. You've been accelerating there against some tough comps for two quarters now. Is this a reflection of a step up in new customer wins, or is this existing customers consuming more of the menu? To follow on from that, should we expect North America immuno to continue accelerating in H2? Especially as I think the comps get slightly tougher as well. Thank you.
Hi, Kavya. Listen, first, you always catch me off guard when you ask me about quarter to quarter because it's impossible to predict. I understand everybody has to look at the business in quarters, but trends in quarters can be all over. I think that you need to look at the consistency of growth. DiaSorin has been, this franchise has been consistently growing year- on- year over the past five years. This, again, has to do with a combination of two things, in my opinion. The hospital strategy that is working very well. You are expanding our install base. Now that we have an install base in hospitals, now we are increasing the loads, what we call the load on these customers. We try to sell more products while we are building a new customer base.
By the same token, we have a great, great relationship with the two major labs in the U.S. that continue every year to take more products from DiaSorin, on the commercial lab side. Therefore, the growth you see consistently is that Gigi is working very well for the company. During the call, I said that we have a target for 100 hospitals in 2025, and we are over 50 already in H1. I have no problem to say that, again, for the fifth year in a row, we are going to make our projections. How is it going to quarter three? I honestly don't know.
To me, I'm not, and I understand that you guys need to look at the way the business deliver on a quarter, but I would not read in this business a good quarter or a bad quarter as a specific indicator that something is really happening. Look at the consistency. In this case, our U.S. business has been very consistent in immuno, and I don't see any reason why it should not continue. That's why we did something.
Perfect. Thank you very much.
Thank you.
Mr. Rosa, Mr. Pedron, there are no more questions registered at this time.
Thank you, operator. Thank you all.
Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect.