Hello. Hi, good morning, everyone. Welcome to the 42nd J.P. Morgan Healthcare Conference. Next, we are pleased to introduce the CEO of WuXi Biologics, Chris Chen, to stage to give us a presentation on the company. Welcome.
Thank you, Lingling. Yeah, it's really my pleasure to give everyone an update. So as everyone know, 2023 is a very interesting year. But every time I come to J.P. Morgan, I actually want to reflect, you know, what our industry is facing, and what are the trends that's coming to our industry. So BioPlan, some of you know, BioPlan is a industry consulting. Every year, they collect the data from 200-300 companies, and they predict what are the trends for the, for our industry. So this is it. They come up with, I pick three that's relevant to WuXi Bio, and, and they mentioned top 10 trends, basically, you know, cell and gene therapy, what's going there, and qualified staff, FDA standard, and all that. So three trends are very relevant to WuXi.
I highlighted them here. Oh, so, sorry, I already go direct straight to the content. So this is how I'm gonna be spending my time. I'll give you a business update. I want to specifically highlight microbial as a industry driver, 'cause we. Over the past of during COVID, we actually built microbial capabilities, so for end-to-end everything like WuXi Bio. And we, in four years, we built a very strong platform, so I'm gonna share with you with that. And then, as some of you know, that we spin off XDC, and we still consolidate. All the top line still reflecting in WuXi Bio, so P&L. But I want to share with you, you know, reflect on why WuXi XDC, why we want to do that, and how successful it can be.
Every year at J.P. Morgan, I want to highlight our technologies. I think this year I'm going to highlight two technologies we believe are transformative for our industry. One is gonna significantly reduce the cost of goods manufacturing. We're gonna cut the cost of manufacturing by half by using our continuous process and technology. And we also believe we have a best CD3 antibody for bispecific for bispecifics. And lastly, every time I want to share with you our ESG progress. So I started already as basically saying BioPlan is an industry consultant, that every year, they predict what's our industry trend. And I pick three that's relevant to us. What they said is basically CMO is actually is in the right trend, right industry, right trend.
BioPlan surveyed 200 companies out there, large pharma, small biotech, medium companies, saying: What's our industry trend? So outsourcing will continue, regardless of whether you're a small biotech or large pharma. Large pharma actually increase in outsourcing in R&D and M. So we are in the right, industry sector. That's the first one, first trend they identified. Second one, actually, is a single-use technology. As you know, WuXi bet on single-use technology 10 years ago. We have- we are the global leader. We have been extremely successful with it, and now industry is finally recognize that. I think BioPlan said single-use technology are accelerating replacement of stainless steel reactors, and then the- I think it's making a huge impact.
As I mentioned earlier, we actually now have a technology to use a single-use reactor to produce the same amount of material as stainless steel and with half of the cost. So I'll share with you, you know, combining single-use reactor with our technology, we actually can truly transform the industry. And the reason we want to do that is because we really want to make the biological drugs more affordable for the emerging market. And lastly, the trend that they identified is offshoring, basically CMO to Asia. It really is still a trend that the company has seen. Again, BioPlan, as you know, is an industry consultant, pretty reputable. I think these are the three trends they highlighted.
I think this will be basically the trend that we'll see this year and hopefully next year. So as I said to you earlier, 2023 is a very exciting and interesting year for us. It's interesting and exciting. So in Q1, as you know, as those you follow the company, you know that the number of new projects we sign is a very good, strong indicator, a leading indicator for our revenue growth. So in Q1 of last year, we signed 8 projects, and by May, we have 25 projects. So investors panic, saying, "You know, why would you only sign 25 projects?" And then by June, we signed about 46. You know, Q3 was pretty good, and we signed 61, and Q4 was a tremendous.
It's the best quarter ever. We actually signed, in Q4, we signed more projects than the first 9 months of the year. So we, you know, last year was very choppy. Again, if you look at this, almost like a rollercoaster ride for us, right? So at the beginning of the year, we believe that, you know, our industry, we're gonna sign 120 projects. We actually delivered 122. But by May, we got down the number of projects to 80 because we, you know, May, we only have 25. We said, "Last year, 80 would be good." You know, by June, we signed 46, and by September, by November, we signed 61. So, December, we actually, every day, we signed two contracts in December.
So somehow the sentiment, you know, sentiment changes dramatically between November and December. And it's also across the board. You know, we have projects signed in London, in Basel, in Shanghai, in New York, in Boston, in San Francisco. It's across the board, even in China. So if you look at the right side of the chart, the U.S. account for 55% of the new projects. Again, basically saying we actually, you know, we did see, you know, from this number, is a very strong recovery of U.S. biotech. In Europe, 14%. China, amazingly, 25%. The struggle we had in the first half of the year was also because China was really lackluster. You know, the most significant drop in number of projects, first half of the year, is China, was China.
But second half, we actually see the number of projects tripled in second half compared to the first half. And that's why China now still account for 25% of new projects. So it's very exciting. So as I said earlier, so we see across-the-board recovery. We see large pharma, mid-sized biotech, and small biotech. And it's the strongest in U.S. and Europe, in Korea, in Japan, but it's also relatively good in China. But in China, I want to caution you, in China, it's a very small sub-segment, is a company working on ADCs, company working on autoimmune. So not across the board. So I think will remain to be seen, how China will perform this year.
But again, if you look at this number, it's actually a rollercoaster ride for us. I said over and over again last year, you know, we are the last person to feel the cold during the biotech downturn. Because, you know, biotech downturn started in November 2021, but we didn't feel the number of projects impacted until Q1 of last year. But we hope we are the first to see the recovery. Now you actually clearly see very, very strong recovery. So my BD head, you know, told me the story, almost like in the whole, the whole last 12 months, almost like every biotech company is like a plane hovering around the airport, and they don't know when to land. And somehow, November, December, everyone to land, and also they want to land on WuXi. I think that's a great story.
That's a great story. So our market share actually was the highest ever last year. Again, because the pie is much smaller. If you exclude COVID, right, you know, we actually achieved record high number of project last year. That basically means, you know, we have a strong ammunition for growth. For second, you know, starting from Q2 of this year, we have a strong ammunition to grow Q2, Q3, and Q4. We'll see, you know, WuXi really go back to a very strong growth momentum because the number of projects signed already there. I think, and the other thing I want to also mention, I think we do see, really, I think China play a huge role in terms of ADC there. I think.
So, again, 2023, looking back, right, I think, you know, we had quite a few events, but now I think we think for us, the weak biotech funding is over. For us, we see a full spectrum recovery in all the territories, and although in China, we still want to see more data. So that's the Win-the-Molecule that's the Follow-the-Molecule strategy. We see a record number of projects. Win-the-Molecule continue to do extremely well. That's also a best year for us. We actually signed seven phase III program and two commercial program from our partners, from our competitors. So Win-the-Molecule continue to be another great year. And this is something you are very familiar with. Now we have the largest funnel ever.
So I think the funnel paused a little bit last year. Now we actually, we have close to 700 assets. If you look at our phase III and commercial combined, now we have 75 projects. This is comparable to industry leader in CMO. You know, we have 51 phase III program, 24 commercial program, 75. If you look at our peers, you know, even the large CMO, they have probably 80, 70-80 number of projects. So by that basically means our CMO revenue will catch up very quickly. So you know, you know, historically, we are very strong indeed. That's why you look at the, the top of the funnel, it's very heavy, right? We have 339 program, preclinical, 200 program in phase I, 80 program in phase II.
But I think the phase III and commercial will drive the near-term revenue. And for near-term revenue, again, as a pre-indicator for CMO, is the number of PPQs you are doing. Basically, you're doing the final process lock, and then you create a data package to submit to FDA, so for FDA approval. So that's a leading indicator of a CMO revenue. So if you think about, you know, back in 2019, we have four. Now 2023, we have 35, and next year, we're probably adding another 10. Another 10. So every year, we're probably adding another 10 CMO projects, 10 projects in PPQ that eventually will lead to CMO. Our PPQ success rate is also incredibly high. We are looking at 97%. So that's why the company trusts us.
When they look at this data, you know, basically, if I give you the project, you know, I'm almost guaranteed it's gonna be successful. 97%. Industry leader can do 90%. I think we actually are 97%. That's a strong early indicator for our future manufacturing revenue. So I think I have give, Ireland is really the first global site we are operating right now. It's actually very exciting. We are about a year ahead of schedule in Ireland in term of business progression. Now, we believe Ireland will break even this year. We'll be generating profit for us next year. So just to remind you, we built the whole facility during COVID, and our industry is saying this is one of the best facilities to be built because we received the ISPE award.
Now, we actually, you know, Ireland facility now is 85% booked. You know, we have three factories in here, three factories in here. Two factories are 100% booked. One factory is about, you know, about another 50-60% booked. So this facility is already 85% booked. We just started manufacturing this year. We have made two batches. We have finished one batch successfully, and we're working on the second batch. So we're just beginning operation for this facility. Now, actually, the facility is 85% booked. I think the playbook that we have for Ireland is transferable, hopefully, to Germany, to US, and that basically means our future success of our global capacities. I think we have 700 assets. We have 75 phase III in the commercial programs.
Because we don't disclose the project, a lot of you know is struggling with how do you model the you know revenue? But I want to highlight you know the 20 programs in this 80, in this 75, the 20 programs are very exciting programs that I want to share with you. We have seven programs, hopefully will be mega blockbusters. And our clients believe this will be $2-$5 billion drugs and even more y ou know we have two bispecifics. We actually have three bispecifics, but two for cancer, one for non-cancer. We have FcRN antibody, we have two ADCs, we have another autoimmune program. Those programs, client believes this will be a $5 billion drug, $2-$5 billion drugs. We have 10 programs that will be a billion-dollar drug.
Actually, we you know, our client believe will be, and this includes the Pompe ERT, the cancer antibody, vaccines, biosimilars, and lastly, long-acting HGH. And we have many other programs. So this gives me the confidence saying that, you know, our CMO revenue will be comparable to industry leaders eventually. I think give us a couple of years. Again, we have those 20+, a very exciting program. We need time for them to ramp up, because right now they are, they are in the early phase. Most of those programs just either get approved right now or still just finishing phase III, phase III trial. Being a CMO, quality is hugely important. I'm actually very proud to announce that we have 32 regulatory inspections.
So far, we are 100%, 100% successful on every inspection. We also have a leading indicator. Every year, we have 200 visits from our clients. We have a leading indicator for quality. Every year, 200 clients in a company like Lilly, Merck, GSK, AstraZeneca, or, you know, Amicus audit us. Audit us. This is, this is a track record for in the past four years. Back in 2019, every time they come to see us, they find 1.7 issues. Back in 2019, four years ago, five years ago. You know, when they come to see us, whether it's AstraZeneca or GSK or Amicus or, or a small biotech company in San Francisco, right? They come to audit us, they find 1.7 issues. Now, it's 0.55. So basically mean every two clients, they can only find one issues.
And that's why we believe this is a very strong. We have a very strong quality system that set us up for a future success. And we are very proud. We have 32 regulatory inspection. We have no data integrity issue. We have zero data integrity issues so far in, in, This is one of the best track record in our industry. So quality forms another strong foundation for our future success. So as I mentioned in the beginning, during COVID, we actually built end-to-end capability for microbials. Microbial is a totally new platform. As you know, 95% of revenue come from mammalian so far. So microbial is a new segment we are working on, but we built this capacity during COVID in the past four years, but we actually progress it very, very fast.
Now we have t his year, we have 25 programs already. As you know, microbial, what do they do? Microbial, we can make insulin, we can make GLP, we can make nanobodies for eyes, for cancer. So that's the indicate that's the target we're working on right now. So we have 25 programs right now. And again, if you look at the pro. We actually just signed our first commercial project for microbial. This is something I'm very pleased. We invested in the capacity four years ago. We signed our first commercial program, our CMO. I think this product is actually one of the best-in-class HGH, and hopefully will become a blockbuster as well. And so, again, in a very brief, you know, three or four-year time frame, we build end-to-end capability for microbial.
We can do plasmid DNA, we can do mRNA vaccine, we can do a GLP analog, we can do insulin or insulin analog. And those are the projects in the current pipeline already. I think, looking at WuXi, you know, we have been incredibly successful in the past 10 years. We believe we always have the right strategy. We have good people to execute. We have WuXi always focus on technology, technology, technology. I'll share with you the technology we're going to highlight today, right? And we have very good track record in execution. Very strong quality, I mentioned earlier. The speed is always number one at WuXi. You know, when you ask my client, what are the first thing they felt?
Well, WuXi deliver high quality, but at the fastest speed in our industry. And lastly, we're very flexible with the client. This is how WuXi have been very successful. We apply the same concept to ADCs, and then in a couple of years, we incubated another very good company, WuXi XDC, right? So again, to go back to the strategy, for XDC, we do everything one-stop shop. We do payload linker, we do antibody, we do a conjugation, we do drug product. So if you look at the current ADC supply chain, you have to travel around the world a couple of times, right? You know, thousands of miles. For WuXi XDC, we do anything within 200 meters, basically, almost like this building. We can do everything for ADC, right?
And we hire the best people. We are working on technology for conjugation. We are working on technology for manufacturing. We have very strong execution, very strong quality. So everything is reflected in the XDC as well. And that's why XDC had a very successful IPO last year. You know, it's very similar to WuXi Bio. XDC has a number of, you know, more projects than anyone in the space. Revenue-wise, number two globally, we're dominant leader in China, and we have pretty significant market share globally. I think if you look at the XDC funnel, and it's very also very exciting about almost close to. This is actually last June's number. So close to 100 program is being developed by WuXi XDC.
And so again, if you look at really the growth of the WuXi XDC in terms of number of client, we started in 2020 with almost less than 50 clients. Now, in three years, we actually number of clients triple. Number of clients triple. Because XDC is a subsidiary of WuXi Bio, this time we did everything right. I think, when XDC has a strong growth, it's everything, both the profit and revenue are reflected on the books of WuXi Bio as well. So we remain consolidated. So the only difference between IPO and non-IPO is actually, before IPO, I book 100% revenue, I book 60% of profit. Now, after IPO, I book 100% revenue, 50% of the profit. So that's the only difference.
So essentially, all the benefit, all the growth from XDC in the ADC field still reflected in the P&L of WuXi Bio. And lastly, I want to clarify here at this podium as well, I think we have very strong corporate governance. Myself, as the chairman of WuXi XDC, I don't receive any compensation from XDC. I think all the WuXi Bio and the WuXi Biologics employee do not receive any option or shares from WuXi XDC. Only full-time WuXi XDC employee are eligible for the compensation from WuXi XDC. But as a chairman, I actually bought shares during the IPO, just to as a support. So I think there, I think this is really clear to show WuXi governance.
I think myself, as the chairman of WuXi XDC, I only benefit from XDC by WuXi Bio share price, by WuXi Bio shares. I think, as I said earlier, every year, I want to highlight with you the technology we're developing. I think this year we have two technology I want to highlight. One is something that's already proven. Last year, GSK signed a deal with us, a $1 billion deal. GSK want us to develop 4 bispecific for them, using our CD3. This is actually, you would believe this is potentially best-in-class CD3 programs out there to make bispecifics. As you know, bispecific and ADC actually have very similar target, right? ADC, you use a chemical payload. Bispecific, you use the body's own payload, you use a T-cell, right? So you use a CD3 to get a T-cell response.
So we believe the second hardest area in our space, you know, the hardest is certainly ADCs. The second hardest is actually bispecifics. We believe WuXi has a strong way in bispecific as well. And as you know, in the past 10 years, we have been working on technologies to transform biomanufacturing. We want to use a continuous process to improve productivity. Finally, we launched our third generation process, called WuXiUI , ultra-intensified process. What does it mean? Means per liter volume, now we can get five times the productivity of a traditional batch process. So our highest productivity titer we got is actually about 30, 30 grams per liter or 40 grams per liter. So what it means for this technology, what it means is, for my 4K bioreactor, I can produce the same amount of someone else's 20K reactor.
My 4K is equivalent to someone else 20K. My 2K is equivalent to someone else 10K. That's the technology input that we have, and it's amazing. I think we just launched the technology in November. We already have the first client sign up for it, 'cause they want to really use this technology to reduce the cost of goods by half. I think our industry has a long debate on disposable versus stainless steel. As I mentioned in the beginning, disposable is actually majority of the technologies that companies they use. Majority of company pick disposable now instead of stainless steel. If you compare a single disposable versus a single stainless steel, large stainless steel, it's not an apples to apples comparison.
Certainly, disposable is more expensive because disposable largest one is 6K right now, but stainless steel can go to 12K or 20K. But if you multi-pack them, if I have a six, a 2K reactor or someone else, 12K, it's equivalent. You know, at WuXi, we can actually do it 10% cheaper. Because I use less water, my facility's footprint is smaller. I actually can do cross changeover much faster. So disposable can actually in even apple-to-apple comparison, can make biologics cheaper. If you apply the technologies we use, if you apply our WuXiUP , the technology we launched about four or five years ago, we can get 20%-30% cheaper. And if you use the technology we launched last month, two months ago, you can actually get 50% cheaper.
So I think this is very meaningful for emerging market. So with this technology, I can make PD-1 as close as $500 a year. The cost of PD-1 treatment for patient is $500 a year. $500 a year for PD-1 treatment. I think that's how this technology can change our. I think at least the affordability of biologics in the emerging country. That's something we're very passionate about. Certainly, we can help, you know, if you have a project that's very cost sensitive, and if you have a project that's a replacement of plasma industry, right? If you are using recombinant replacement plasma, you have to compete with the plasma industry cost of goods. This technology is there to help you. I think, lastly, I still want to give you an ESG update.
I think we're very pleased. Now, we are actually part of the Dow Jones Sustainability Index, and this is actually a very, very hard, very premier index, and only the best company in our space, in our sector can get in. They consider us number one in this sector and identify us as a global sustainability leader. I think, as you know, you guys know the significance of this. We're also very pleased to say that we actually received MSCI AAA ratings. I think, you know, we started with A three or four years ago, we had double A last year, and this year was triple A. So it's incredible progress, and the whole community recognizes us as an ESG leader.
Because our corporate governance, because our talent development, because our quality, because our serving the global market, because our sustainability efforts. So EcoVadis is a pharma consortium, like a company like Pfizer, Merck, BI, AstraZeneca, GSK. They come together saying, "I want to have a standard ESG requirements." It's called the consortium is called EcoVadis. We actually ranked also top 1% in that section. So I think we're very pleased with our ESG progress. I think every one of you familiar with the CRDMO model. I think 2023, as I said, was a challenging year. We actually ended the year with a high note. But if you look at our business model remain, you know, our business fundamentals are incredibly strong.
Our business model remains the strongest in the industry. Right. I think we just announced that we had a collaboration with BioNTech. We help BioNTech develop two novel antibodies, and that's our R, right? We so our R continue to be very unique. We use our IP to help company like BioNTech, like GSK, develop their portfolio. And as a result, we get royalties and milestone payment. And so we have a six-figure dollar milestone payment. We have 50 programs with royalties, and royalties becoming significant in the next couple of years. And we are the strongest in this community. Last year, our market share actually exceeded 50%. And you know, you know, we added 132 projects last year, and this year, we believe we'll continue to add another 110 projects.
You know, previously, last year, we were guiding 80 projects this year. Now we raised the guidance from 80 to 110. I think, you know, this new project will give us about a $1 billion revenue every year, and that gives us sustainable growth. We have very sticky business. Our R will lead to D, our D will lead to M. In summary, I want to highlight 2023. I think biotech funding, especially the weak biotech funding in China, hurt us pretty badly in Q1, but we see a very strong recovery in Q2, Q3, and Q4. You know, we actually already seen a full across-the-board recovery as well, in U.S., in Europe, in Japan, in Korea, and in China. That's why we signed a record high number of projects.
We also Win-the-Molecule strategy also worked very well. We actually signed nine Win-the-Molecule projects, seven phase III, two commercial. We have 24 CMO projects right now. If you add phase III and commercial combined, we're getting to 75 projects, and that's gonna be a good indication for our future CMO revenue. I think I want to highlight again, WuXiUI , ultra-intensified process, that can reduce the cost of goods biomanufacturing by half. I think, oh, you know, certainly WuXi will benefit from, from that as well. And then microbial business is a new business that we invested in the past four years. Now it's growing significantly, and we have one commercial project that hopefully will give us a very strong revenue.
So, again, 2023, we see a weak first half or weak Q1. We see a very strong recovery and rebound in Q4. So as a result, we will start to see accelerated growth in Q1, Q2 of this year. And the Q1 and Q2 was still impacted a little bit by Q1 and Q2 of last year. But Q2 and Q3, we'll start to see accelerated growth. So we're very positive in terms of outlook for second half of 2024 and then for 2025. Again, with the 75 project in phase III and commercial, I think definitely this will be. A CMO will become a bigger and bigger part of our revenue. And lastly, you know, we have been always betting the sector right. We have very strong investment in ADCs. We have very strong investment in bispecifics.
Now we're investing in microbials. I think a nd then, in the meantime, we are working on our own lean manufacturing called WBS, WuXi Business System, WBS, and also the digital and automation to improve our overall efficiency. Thank you for your attention.
Thanks, Chris, for the presentation. I guess now we'll open up the floor for questions, if any. Just a reminder, you can also submit your questions online, for those who are watching the webcast online. Maybe I'll propose one question. So Chris, you saw a strong we saw a strong rebound in the new projects signing for the fourth quarter of last year. And you talked about there is a specific subsector for the China new project. Can you elaborate for the rest of the world, especially for the U.S., who, you know, accounts for more than half of the new projects?
Yeah. For US, Europe and Japan and Korea, we actually see excitement again. I think the reason we have such exciting Q4 is actually we have been engaging with these clients, you know, year or year long. Again, in June time, when we talk to them, they probably say, "You know, maybe wait for a couple of months. I'm not sure whether I want to do it now." But in November, December time, suddenly the sentiment changed. Maybe because either the funding is improving or they feel like they really need to get to start. I think we are enabler. That if, you know, if they have money, you know, work with us, their company value will increase. Because, you know, if they have money, if they keep the cash, but don't move the project, the company doesn't add value.
So I think maybe November, December timeframe, suddenly the mindset changed from my clients. I think that's why my team said is the sales cycle is gonna be a little bit longer, but overall, it's still like all the airplane hovering on airport, and suddenly they need to land, and somehow they want to land before Christmas. I think that's why December is incredibly busy for us. So every day, again, every day we sign two projects, and that's how crazy it has been. It was the best ever Q4. It was the best ever December. We also, as I said earlier, we have a client from London, from Basel, from Munich, from San Francisco, from Boston, from Shanghai, so a nd Japan and Korea. So December, we actually signed almost every country, signed new projects.
Oh, sorry, I saw a gentleman raising up questions.
Chris, great presentation. Just as you were landing all the planes, pricing. You know, there's a lot of industry talk about all the capacity coming online. What are you seeing with pricing?
That's a good question. Yeah, I didn't mean, The pricing was actually, you know, we didn't use any incentive. We didn't use the pricing as a lever at all to sign these projects globally. Globally, pricing is still very stable. We just, starting this month, we're actually increasing pricing by 5% across the board for our clients.
I saw there's a lady back there who has a question.
Hi, Chris. I actually have a quick follow-up on the pricing. How would you comment on the trend in China versus globally when it comes to pricing? Because we know there are a lot of local players in China going very aggressively after a lot of the orders you are signing now.
Yeah. In China, there are two worlds. There are WuXi, there are non-WuXi. So, because the company that can afford because WuXi is a premier pricing. You know, we have the same pricing. For if you are AZ, you come to us, versus the biotech, you come to us, it's the same pricing. So I cannot say, you know, there's a China pricing. So because of that, only the premier companies in China can afford our services. And as a result, there is a natural selection. So the companies that work with us, they end up having very good assets, and then they end up licensing the program to BioNTech, to AstraZeneca, to BMS, to Merck. I think I, you know, I didn't mention this, in the past, 18 months, you probably see a wave of the global deals, right?
And 80% of the CMC. 80% of the licensor programs behind them, WuXi is the, is the platform. I think so you clearly see a WuXi, WuXi-based, WuXi-supported companies or WuXi-enabled companies versus non-WuXi-enabled companies. So it's 80% versus about 5%. So if, if, I think that actually become my marketing campaign. If you work with WuXi, you can partner with large pharma. If you don't work with WuXi, you only have 5% chance, right? I think. And that's a, that's, we actually are- our pricing premium is about 50%-100%, to compare to peers in China. And that, that's really the value, right? You know, 80%. 80% probability working with large pharma and 5%. Actually, I want to share with you just this, even this week, there are a lot of announcement.
A lot of them are actually behind them, WuXi is a CMC leader. WuXi is an enabler. Large pharma didn't even do due diligence. So we will announce they're going to do due diligence. Actually, large pharma said, "You know, I know WuXi, and we'll just pass." So that's the, that's the WuXi brand. So if you, you know, regardless of whether you're in Basel or you are in San Francisco, if you work with WuXi, right? And I, I think, you know, when you license your asset to g- to large pharma, large pharma trust him, because all the large pharma are my clients. And also, I'm also very pleased to report, large pharma now accounts for 50% of my revenue. 50%.
So when we IPO, it's 10, 20%. Now, large pharma is 50, because large pharma keep gobbling up new biotech companies. So I think that's the WuXi brand, that's the WuXi value. So when you work with us, you know, the incredible delivery that we give to you, so we assure, first of all, we assure almost 100% success. And secondly, when large pharma look at due diligence, there is no issue. It happened, especially during COVID. There are so many deals. Large pharma, even if you want to do due diligence, you could not, but it's all remote. So large pharma actually waived most of the due diligence for. I was every time I go visit large pharma, I was joking: "Next time when you buy a company, 60% chance is WuXi. 60% chance is WuXi."
Yeah, it's, it has been true. Has been true.
Yeah, we have a question online. Can you explain more, in more detail how single-use technology is 50% cheaper than stainless steel? And, you know i f this is still the case for the Ireland?
Yeah. There's a lot of misconception about disposable versus single, disposable versus. Disposable be more expensive than stainless steel. Because stainless steel, right, you don't use the bag, but you don't use the bag. Because the bag component, right, we pay Thermo Fisher or pay Danaher, very expensive bags. But the bags, from every bag, let's, let's use a 12,000-liter bag. The bag costs, let's say, $100,000. But, but I use a lot less water. If you think about a reactor, you have to clean it so many times to make it clean. The water that you use to clean it, it like cost $2-$3 a liter. Right. It's a water you can inject into your vein. It's called water for injection, right? Because it's water for injection, it's very expensive.
The water is actually cost $2-$3 a liter. And you wash it crazy. And because you wash it, you also need to prepare the water. You have to send it to the area. And so actually, there's a lot of costs you don't know for stainless steel. I think, I don't know how many engineers you have in there. There is a cascade in the pH- you know, if you have a fermenter, you have maybe 200 cascade. Each cascade is $50-$100. When you throw away the cascade, a lot of money as well. So with disposable, you have a much smaller footprint, much smaller water, steel, much smaller footprint of the facility, much less piping to send the water over.
So because of that, actually, the cost, the cost is actually lower. So your CapEx is lower, your OpEx is a bit higher, so it's a balance in that sense. So the balance of CapEx versus OpEx. So your operational CapEx, as I said earlier, every batch, you use $100,000 more bags, but you're compensated by less water, by you know, less CapEx, and then by being able to do more batches, by also higher success rate. So with disposable, now I can do 98% success rate. And if you have a stainless steel, our industry best track record is about 95%. So basically, if I make 100 batches, I can have 98 batches successful. If I use stainless steel, maybe 95.
So three batch actually make a huge difference, because if you lose three batch, you have to my op, net profit is only 12%-25%. If you lose three batch, you have to make 12 batches to compensate, right? So you're making 12 batch, that profit from that 12 batch just compensate the gap between the success rate. Again, that's 12% of the batches, right? So it's not that obvious, but we have been doing disposable for 10 years. We know disposable actually is cheaper. But now with the technology, coupled with our new technology, now it's obvious, right? We want to cut the cost by half. So if you want a $20 per gram or $50 per gram, you know, this is a technology that can give you that, give you that.
Thank you, Chris, for a great presentation. I have a just a small question about U.S. You have adding the capacity, manufacturing capacity, I mean, two days ago in U.S. Would you please give more color on that?
We see a lot more demand in the U.S. for. As you know, U.S. government wanted to do more onshoring. We are part of the effort to support that as well. That's why we actually invest more in U.S., to be closer to the customer. So we have, you know, as you know, we have strategy. We invest in Ireland, invest in Germany, invest Singapore and U.S. This way, we have a global diversified network, really, and you know, I think that basically, you know, if you want. For every one of my client, they can have a choice. They can go to which cities in China, or they can go to Ireland, or they can go to Germany, or they can come to U.S. To give them a lot more option.
Go ahead.
Do you have any plans to expand into bioprocessing tools , you know, kind of more like the Thermo model?
I think I'm focusing on the things that we do well. I think the CRDMO kept me busy already. I think we do have we invested a couple of small companies in China as a business continuity plan, but I don't think that's gonna be our major focus. Yeah.
One question from online. None of the other big CDMOs have talked about the snapback of the projects in Q4 last year to the extent you did. Do you see that more of, you know, an industry-wide willingness to put more, more project forward, or that's more of a share gain from WuXi Biologics?
I think it's probably, I think it's both. We definitely are gaining market share, but I think the pie is also getting bigger. So the pie first half of the year versus the second half is probably very different.
So you do see a turnover for the biotechnology industry funding coming back?
We do. That's why I said the client sentiment is changing. This week, we are meeting 80 clients, 80 clients in at the Hilton. I think everyone's mode is much better than the last June when we talked to them. We're doing bio. I think, I think that somehow, you know, between the November and December, that something, something magic happened. Our client are, are more comfortable of, of, you know, signing the check, right? Essentially.
Okay, I think our time is up here. Thanks, Chris, for the great presentation, and thanks, everyone.
Thanks so much, Lingling. Thank you.