Tecan Group AG (SWX:TECN)

CMD 2019

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Jun 6, 2019

So a very good morning and welcome to Tecan's Capital Markets Day 2019. It's my sincere pleasure to welcome you all here in Menador, but also, of course, welcome everyone that listens live on the webcast and listens to the recordings afterwards. My name is Achim Verlier Brechting. I'm the CEO of Tecan, and it's my sincere pleasure to be in that position. And what we're trying to do today is give you an overview of Tecan as a company, but also as our market environment and particularly give you some insights on how customers view the interaction with us now and potentially going forward. So maybe just quickly to go through the agenda of the day to day, we will have 3 major segments in which we will talk about application focus and market segments that we're serving. So we're starting with the genomic applications where we talk about our own capabilities and our own progress, but we will also have a presentation by Embraer Genetics that will talk about their experiences with labor automation and the workflows and our collaboration in their industrialization efforts. After the coffee break, we will talk about tissue and cell analysis and our offering. This will be presented by my colleague, Klaus Lund, who is with me here in the front this morning. And then afterwards, we will talk about protein analysis. So in the largest context, immunodiagnostics and mass spectrometry. Again, it's a first we will talk about Tecan's capabilities and Tecan's strategy in that market segment followed by a customer presentation with very exciting talk from the binding side and their CSO talking about deployment of mass spectrometry in a very new application field in oncology. After the second coffee break, we will talk about enabling capabilities and our view on innovation, and this will be presented by by Vael Jaret, who is a designated CTO and Head of R and D joining TCAN or joined TCAN earlier this year. And then afterwards, I will talk about operational excellence and our efforts to improve and continue our journey to build out a very capable and efficient operational network headed by Ulrich Kanter. Ulrich Kanter cannot be here today, unfortunately, because he's just flown to California to help with the integration and first steps of the integration productivity of our new site that we just acquired in California. I will talk about this later in this presentation today. And then later, I will then give an update on the pumping business followed by my summary and closure, and then we will have time for Q and A before we break for lunch. And then after lunch, for those who are with us today here live, we will have we have set up a variety of demonstrations and live showcases where you get more hands on insights on what we're doing and some of our innovation and new products that will come to market now and in the short term future. So with this, I probably wanted to start off with showing you again the cover of our most recent annual report that we titled Empowering the Century of Biology. And this is truly what I and we as a team believe Tecan is capable of doing and this is what we're actually engaging in and what we're driving forward in the years to come. Tecan is benefiting actually from a variety of megatrends, and I just wanted to take you a little bit through the background of our industries and some of the key drivers and enablers that are positive in our industries. So first of all, we're looking at population growth across the globe, but also an aging population. That in itself, the latter point, of course, is a very positive event. However, it creates a lot of pressure on the health care system demanding for better prevention systems, but also for clearer and more precise diagnostic systems that can be deployed more economically to capture these increased amount of people that will go into the health care systems. And then secondly, there is high levels of investment in Healthcare and Life Sciences in emerging regions and specifically in China. So we're looking at the out at the build out of the healthcare system in China. It's fair to say that we're just at the beginning of really diagnostic and health care industry in China and also associated life sciences is growing at a substantial pace, particularly in China but also other emerging regions. Certainly, we are, of course, looking at the development of more targeted pharmaceuticals and the use of companion diagnostics. So just reflecting back at 2017 was a year where the FDA approved 40 6 new drugs and out of which we see increasing amount of immunotherapies. And also going forward, what we can see the arrival eventually of genetic therapies that address some of the most important disease states. Also very importantly, within these 46 drugs that were approved in 2017, more than 14 were novel drugs addressing cancer, which remains to be one of the most critical cancer disease states that is being researched on and being kind of targeted for better therapies and diagnosis. And then we see an explosion of biological knowledge that derives from the life sciences industries and markets, but then rapidly transmits also into areas like food and environmental testing. So for example, a lot of research is going on, on the microbiome and the gastrointestinal tract of humans and how they're affected by nutrition. So there's a lot of research that's now moving over into the food industry, looking at better targeted nutrition that cope with allergies and intolerances of growing populations. And then lastly, I will talk about this a little bit more, is that emerging market of genetic testing for customers. And this is something that has started just a few years ago, and we see an exponential growth of demand for consumer genetic testing. So all of this for us in our world drives increased test volumes. And as we are a laboratory automation company, that is, of course, beneficial. So this drives need for increased productivity, reproducibility, standardization, increased demand for precision in the execution of experiments and increased demand for robustness and reproducibility of processes overall, but it also requires increasingly knowledge and capabilities in the areas of regulatory compliance, all of which drives adoption and penetration of laboratory automation in our view. So for those Human Genome Project, This is where I think you could probably credibly claim the century of biology really started. This was the largest global collaboration project ever conducted to uncover and unravel the human genome. And as you are aware, this project started in 1990 actually with a consortium of research institutes that were venturing around this decoding of the human genome. So there was a couple of steps in between. So it took 9 years actually to decode the first chromosome. So 9 years of work and preparation. And then a year later, the first fruit fly organism was decoded. And then subsequently, the first draft of the human genome was created. 2002, the first mammal, the mouse was fully sequenced. And it was not before 2,003 when the first full human sequence was produced. And this, as you can clearly see, took 13 years and actually absorbed more than $3,000,000,000 of U. S. Dollars in generating 1 human genome sequence and analysis. Now the world around us has changed quite drastically and we see an accelerated adoption of similar technologies in areas, for example, like population sequencing programs that are conducted now in numerous countries. So we see more than 50 programs aiming at substantially screening populations for the benefit of understanding rare disease diagnostics, improving specific aspects of drug discovery, looking at the carrier status of diseases in certain areas of the population, improved pharmacogenomics, but also looking at population by susceptibilities of environmental factors and other elements. So for us, of course, that is probably one of the most fundamental events right now that is happening around us. And you can see that in various countries, these programs are heavily funded and requiring a lot of products that fuel this upscale of sequencing capabilities in all these efforts that are being run. So I mentioned before consumer genomics. That's been a pretty new venture for the industry, and it all started off significantly in 2014 where we were looking at maybe 1,000,000 consumers that sent their DNA for testing or did some spit spitting in a tube arrangements and send it to companies to be sequenced. And this proliferated already until 2018 to 12,000,000 consumers that sent in their samples for testing. And you can see on this projection curve that is expected that this consumer genomic market will now rapidly grow and really accelerate beyond the kind of pace that you've seen before. And this is all driven by areas like ancestry research. This is probably the most commonly known aspect that is used for today. But we will see already today that most customers that send their DNA for testing consent already that this information may be used for research cases. And as you can imagine that this already drives a lot of increased understanding, for example, of genetic health risks, which is another area of course of interest. There is still regulatory debate on how this is going to be used, but I think we've seen the first clearances of companies of 23andme and others that are moving very fast in this direction. But of course, this gives increased opportunities to more personal and more precise diagnose and see the preposition of patients, for example, for breast cancer, looking at targets like BRCA1 or BRCA2 and other molecular markers that indicate the susceptibility to these type of genetic health risks. And then there's, of course, other areas like wellness testing or carrier status to trying to understand for certain inherited conditions of diseases like cystic fibrosis or sickle cell anemia and other areas of the healthcare disposition. So now where does TECAN fit in and where are we engaging in? And we probably I would like to start with describing the health care uses of what our customers try to do and are actually doing as we speak and will be doing going forward. So we engage in the health care uses of areas like cancer, cancer research and cancer diagnostics, infectious diseases, hereditary diseases, rare and off diseases, metabolic diseases. So virtually all the critical elements of the health care questions and conundrums that are being addressed and unraveled today and of course several more. So we physically work with 3 main categories of clients in that environment. So firstly, we work with research institutes that try to understand disease mechanisms and patterns and disease origins. Then secondly, we work, of course, with pharmaceutical industries where they use our products to up scale the efforts in drug discovery and drug development to address and tackle these type of disease modalities. And then lastly, we're working with IVD companies that increasingly take novel technologies to better diagnose and on a more personalized and precision level, treat these patients with these new drugs that come to market. So our application areas and our application focus, which is also the theme for the day to day, is really centered around genomic applications, protein analysis in the broader sense, including immuno and mass spec applications, but also cell and tissue analysis. So all of which are very complementary and critical to understand these healthcare use and disease states. So our suite of detection and asset technologies includes supporting sequencing workflows, including next generation sequencing, so novel workflows, but also traditional like PCR and qPCR, areas like mass spectrometry, immunoassays, imaging, advanced staining and several more. So these applications and assay technologies are very core to what Tecan is able to automate and facilitate within the customer base that I just described earlier. So what do we bring to this equation? What has Teekin built up over the last nearly 4 decades of experience and market presence? So we have a wider range of experiences around these workflows and applications. We bring, I think, a comprehensive suite of robotics and automation products, including increasingly software and informatics products. We have a lot of experience in detection and imaging, but of course, we have the origin in the area of precision handling of liquids and increasingly engaging also to complement our instrumentation workflows and offerings with reagents and consumables that help to drive the productivity and the utilization of these applications forward. And all this, of course, built on a very solid foundation of our product development and system integration experience. Our area of particular strength, I would call out is in addition to the engineering capabilities and operational footprint, the regulatory and quality experience that we bring to this equation. I will explain later why that is so critical in the positioning of Tecan in that dynamic market environment. And of course, we, I think, leverage and run on a very efficient operational footprint. So just to illustrate this a little bit further, Tecan today is around 1800 employees increasingly globally distributed and looking at a very, I would say, important and capable skill set of people that come with the distribution of 10% of our employees being PhDs, 33% or 31% having advanced scientific grades and 29% of our employees are actually trained engineers. So I think we have a very capable and very, very motivated and great workforce that helps us in this venture to grow the company and build new and novel technologies going forward. In this set of 1800 professionals, we have more than 5.50 employees that would raise their hand to say I'm expert enough in a given application area like genomics, like cell biology or like mass spectrometry to train a class on this application area. So I would say we have a remarkable pool of people that are looking at it from either personal or private experience or training in university or industrial settings that have practical experience in all the things that we want to do. In aggregate, we spend per year approximately 85,000 hours to support our clients with setting up their applications and delivering the productivity of the systems that we ship and install in their facilities. From our distribution of clients, today we are approximately looking at 60% of our clients being in the clinical diagnostic space and 40% being in the biotech, pharma and academic base. But we see that as a very good distribution of clients around the kind of value access that I just explained to you before. And then lastly, we're very proud to innovate and drive innovation and IP generation forward. So we're looking right now at a portfolio of more than 600 patents that substantiate our position in the market and, of course, help us to defend pricing and share gains in the markets where we engage in. That being said, we look back, I think, at a very good performance over the last couple of years in terms of the revenue growth that we were able to drive in the markets that we engage in. So I think we clearly benefit from all the megatrends and the market conditions and surroundings that I explained to you. And you can see starting out of in 2013, the revenue base grow by more than 50%. And we also, in the same time frame, were able to capture and generate quite a good flow of operating profit and net profit in the same time. So I think that positions us really well for future growth and the expansion of the business in the market segments of interest. Just to illustrate a little bit more where this growth came from and what basically made up this growth acceleration that started after a period of, I would say, top line stagnation with the new team coming on board in 2012, 2013 where we, I think, executed a new strategy and the deployment of that strategy in a very consistent and clear way. So sales total went up, as I said, more than 50%. And about 2 thirds of this growth were actually coming from organic investments and organic contribution and onethree came through M and A. We've seen major new platform launches that, of course, helped us to drive growth and market share in the markets of interest. We've seen a very good and sustainable regional expansion, particularly in China, where now we're looking at more than 110 professionals that work both on the life sciences side, but also on the partnering side to grow our franchise in China directly from several facilities and support centers that we have installed in China. We see, of course, the recurring revenues that have grown, and I would show you later on how important that is for us in the context of our growth journey, and we are offering more and more complete solutions for the workflows and applications of interest. So just to highlight a few of these growth contributors and elements of this growth journey. So the first call out here is the PAPING business, which saw growth from 2013 to 2018 in an aggregate growth at around 9% over that period and now contributing to 45% of the total revenue of Tecan. We've seen China grow from 6% to 10%, always keeping in mind that the revenues that we report in China are only the products that we directly ship into China and exclude all the partnering business products that we ship to European or U. S. Locations that eventually then also find their way into Chinese laboratories and in clinical settings. The recurring revenues increased from what was 2013 34% to now in 2018 already 40 2%. So we're very happy with the expansion of that very important growth area for us. And then within the Life Sciences division, just to give you some illustration of the genomics market that I talked about before, the genomic within the Life Sciences segment grew from what was 17% in 2017 to already a third of our revenues being generated in the broader genomics context in the Life Sciences division in 2018. So now to continue and deploy the COP strategy going forward, some of you have seen this slide before, but I just want to give you some more illustration on what we're aiming at and where our expansion capabilities are. This slide illustrates the market segments that we're interacting with, the Life Sciences segment and the Diagnostics segment, each of them being characterized at a size total market size at around €55,000,000,000 to €60,000,000,000 depending on the reports that you're reading with an underlying CAGR at around 3% to 5%. So when looking at our organizational structure and the divisional structure, you see underneath that our Life Sciences division pretty much lines up with the Life Science market segment and the partnering business with the IVD market segment. However, there is a bit of a crossover where in Life Sciences, we of course sell some products into clinical and regulated market. In the Partling business, we sell some products into the Life Sciences or Applied markets. However, I think looking at the market segment themselves, you can also see that the distribution between reagents and instrumentation is vastly different between life sciences and diagnostics. So we participate predominantly in the instrument segmentation of both market segments where we have a very good presence in laboratory automation and the outsourced part of the diagnostic system where we capture the OEM capabilities in the diagnostic arena. We see continued growth opportunities in that market, both through organic but also inorganic consolidation in that space of interest. And we're very, of course, happy with that market that we're serving in that regard. Then secondly, we see continued opportunity to expand our reach and indicated by the arrow on number 2, in additional technologies that we can be commercializing into the life sciences segment. So today, we have a very capable range of technologies that we can supply and support. But I think there's substantially more that we can capture and credibly own and support in that segment. And this will predominantly come from M and A activities. And then lastly, as I said before, we have a high interest in capturing more recurring revenues and more reagents and consumables. So we're very actively looking both at internal, but also M and A opportunities to expand our completion of products that we can put on our systems and capture more of the reagent and consumable revenues that go through the installed base. So in all, you see that is, I think, a very dynamic environment overall. I think there's a lot of opportunity for us to grow into both organically and inorganically. And we have, of course, a specific focus on growing the Pillar 3, as we call it, in regards to reagents and consumables. So now moving on to the application areas and the three elements of genomics and protein analysis and cell and tissue analysis that I mentioned to you before. I just want to illustrate with this slide or representation, one of the, I think, particular strengths of TCLAN in these three application areas. So as we are serving with our Life Sciences division, mainly the individual workflows of the application areas that we're interested in and through the partnering business sample to answer systems through our IVD partnering channel, I think in particularly the application areas that I highlighted before that are on their journey from transitioning from research into clinical diagnostics, we are particularly strong and well positioned to be that chaperone of transition for technologies like next generation sequencing, advanced mass spectrometry, application and sample preparation methods like liquid biopsies or the analysis of circulating tumor cells and various others, including areas like tissue pathology, enhanced immunodiagnostic tools and so on and so on. So I think we as a company have a great footprint in the research environment. We work with a lot of companies that use these emerging technologies in what is called the laboratory developed test market. So basically that market where large lab chains offer clinical services on self validated systems and then many of these technologies then are on that migration into the more regulated and then captured IVD space where we then talk about the generation and development of a sample to answer result system. And I think we as a company have a very credible foot and path to be that chaperone in that journey. So then just to maybe come to the next sequence of the presentation, we will highlight to you now our views and our strategy around the genomic market in particular. And I would like to have Claus Lund come up now to give you the next section of the presentation highlighting our internal capabilities, and this will be then followed by a presentation by Joy on behalf of Embry Genetics. So thank you very much. And I hand over now to Claus. Thank you, Achim. All right. Good morning to everybody. And again, in hearing Achim's presentation, I always get incredibly excited about in what kind of century we are living right now and how privileged we are to be part of the story. It's the changes in technological innovations we are seeing right now in the field of biology. And on some of the areas I will talk about today is just incredibly interesting and revealing industry that has, I think, a long path to grow and has to, I think, show a lot of new technologies and probably also new companies coming up. So what I wanted to do now in the next sections, it's about applications. I want to give you an overview around genomics, what's Tecan's position in genomics, how do we address that space and how do we think our products deliver on what customers' expectations are. I will talk about cell biology, and I'm very proud that also today, we will be able to show you one of our new instrumentations that we are going to launch in June end of June at the SLAS in Europe. And lastly, we will talk about proteomics. As some of you might be aware of right now, the American Society For Mass Spectrometry is happening in the U. S. One of the key shows around proteomics and just having debriefed this with some of my colleagues, it looks like some very interesting innovative approaches that are coming up that are in line with what I'm going to present you today. So I think it's going to be an exciting section. In addition to that, too, it's easy for us to stand here and tell you how great our products are. All our customers love it. It's a great pleasure that we have one of our customers here today, Joy from Embry Genetics, who will present and give you an overview on how our instrumentation is being used in their lab and is helping them really to increase overall productivity. So let's get going. With probably the one of the most exciting areas in our industry, which is genomics. Genomics is a rapidly growing market. It's a great place to be in. For fundamentals are very positive. It's growing mid to high single digit. It has pockets of growth are far in the double digit area. And it has some trends that came up over the last 2, 3 years that we are convinced are going to stay. This is something that's not going to be over in 1 or 2 years, but I think talking about the center of biology is probably reflecting what we think kind of impact all the genomics technologies are going to have. What we call out here, the move into clinical, this is just beginning. Even if people think, oh, qPCR, all those diagnostic tests have been in the clinical for a long time. With new technologies to come, there is, I think, much more to see much more to see. The NGS, next generation sequencing, has become a key trend over the last 10 years. It's kind of impossible to think that academic institution of a pharmaceutical company has not a sequencing instrumentation and starts to look at expression profile of cells. Then direct to consumer testing, Achie mentioned it before in his presentation. It's come from nowhere, and we believe it will go very far with ancestry testing probably being one of the key drivers, but all wellness and health parameters around it, we think being one of the key elements that will drive the growth there. Then new technologies like CRISPR, I mean, who was talking about CRISPR 2, 3 years ago? Yes, a group of very experts who was working on it, now it has become an area by itself that requires a specific workflow, it requires specific creations, and we expect much more to come along that end. And also liquid biopsy, a lot of talk has been made around liquid biopsy. And we think it's really at the very, very beginning, Liquid biopsy to analyze cells, liquid biopsy to monitor disease progress, liquid biopsy to develop new pharmaceuticals for rare disease, all things that we think are going to happen in the context of genomics. So what does this mean for Tecan? How are we going to capture this unique opportunity? We and there are 2 ways we are going to do that. 1 is we have automation instrumentation that can be used to improve the workflow of our customers, right? In addition to that, we acquired in fall last year a company, NuGen, that is now Tecan Genomics that delivers us reagents that we can use to participate in the field of NGS library preparation. And now by taking our reagents, taking our instrumentation, putting them together and having in mind how those workflows run-in our customers' labs. We are now able to deliver solutions that really address what the needs in the lab are, which the easiest way is that you walk up there to your instruments, have a plate with samples in there. The instrument does Also important to know, and you see it on the right side of this slide, we are going to adopt the reagents on our instruments, but we are not going to stop to sell those reagents also on 3rd part so it's a third party instrumentation. So we are still supporting those Tecogen Genomics reagents also in other automation systems because as I will explain you later in the presentation, we have some very unique capabilities in our reagents that make drive a big request also be automated on other platforms. So in terms of the workflows, what areas do we cover? If you start very simple with the sample collection, that's where everything starts. And there's a big varieties of samples that can be used. In, let's say, 80%, 90% of the cases, you start with an extraction of the nucleic acids, be it DNA, be it RNA, that then run into several workflows that we have lined up here on this slide. Let me call out NGS sequencing. You start with a sample, do the extraction, respective data analysis. On a sequencer and drive the respective data analysis or pick qPCR, right? It's a very established method, and we called out here an application around molecular diagnostics. That's where we are able to offer really end to end solutions, sample to answer solutions, mainly driven by our partnering business, where we're able to deliver instrumentation that exactly addresses some molecular questions that those instruments can deliver. Then things like cloning, right? I mean, it's cloning has been around since 30, 40 years. With the CRISPR hype, with the production of biopharmaceuticals, it has become a key workflow that sees a big demand around higher throughput, where also our instrumentation is able to deliver some very unique workflow solutions. Or genotyping, right, with the Tecan Genomics reagents, we have microarrays in our portfolio. And it's a technology that was declared not to grow anymore many, many years ago. I think facts are just providing the opposite. It's going to stay. It has its position complementary to NGS, and I think we are convinced that it will continue to be there. Or if you take a single cell, it's, I think, incredibly exciting area to look into, analyzing single cells, driving genomics of single cells where we are currently also looking into. So I think Achim mentioned it before, genomics per se has been already a growth driver for the Science business. So we started to drive an application focus already back in 20 13 when we the overall contribution of genomics to the Life Science division was about 1 sixth of their sales. It now went up, if you look back in 2018, to about 1 third. And we expect the contribution of genomics going forward to be also significant in overall Tecan context. Also on the partnering side, and we and I will talk about that. We have several projects that are already on the market that exactly capture the genomics applications and molecular diagnostics applications. So let's, overview on what kind of product offering we have. Let's take NGS Library Preparation. What you see up here is the typical workflow of LIBOR preparation. What we called out in blue is the area where we are focusing in, where at this point from the type of instrumentation and reagents we have, we are currently focusing in. So it starts very simple. If you go with 1 with the sample collection, identification, the aliquoting, the extraction of the nucleic acids, the library preparation and then finally, sequencing and the data analysis. From our focus, what we want to do, it's exactly points from 2 to 4 that we will want to go after. We have the reagents for the NGS LIBOR prep, and I will tell you in a second how unique and differentiated those reagents are. And we are able to improve the overall workflow in the sense of productivity by a factor of 2 at least of what is currently happening out there. So let me give you some examples on the technologies, what we have. So what you see on the left side are LIBOR prep technologies. It talks about microarray. What you see on the right side are some of the unique elements of our regions. 1 is the DNA Seq kit called Celero. It's a technology that allows us within, again, 4 hours to develop a full library that can go on a sequencer. And a key part of this Celero workflow is also the NuQuant technology, right? With NuQuant, what is called up here, we can do DNA quantification at the end library QC, library normalization in a very short period of time with less resources required. We don't need expensive instrumentation to do that, and I will comment about it in a second, but also other technologies. And as this space is just continuously evolving, it's if I would be standing here a year ago, probably some of those elements would have been different. If I will be here a year next year, there will be other elements up there. So it's driven by a continuous innovation of new technologies, new products that improve overall library preparation. The example that we caught out here is any deplete. If you're looking for a very rare transcript, this is the technology to use for single cell applications or if you use bulk analysis of larger cells. But let's have a look at a new quant. It's a technology that I think we launched beginning of this year that is getting very positive feedback from the market. And this explains you why that's the case. Because purely from a workflow point of view, it starts to cut off hours of the traditional library workflow. You don't need to invest in expensive instrumentation. And it gives you the ability to have an integrated system that delivers an end to end workflow much easier than compared to other solutions that are currently out there. The examples we call out here is quantification with qPCR, this expensive instrumentation like the bioanalyzer that require additional steps, that require additional space in the lab that you need to have and run if you're not using the overall new one. So in the context of Nuquan, in the context of Celero, the next step what we did was aggregating and putting together our instrumentation with the respective reagents. And we launched at the beginning of this year at SLAS at the SLAS show, the NGS Dream Prep, which is now our integrated system that delivers end to end solutions from purified sample into the system with a final library that can go on a sequencer. What makes it so unique? And I think what's drawing the attention and making conversations of our salespeople out there easier with their customers, it drives dramatically productivity of labs, right? Before that, you couldn't do more than 1 library a day. Now you can do 2 libraries a day. A workflow that used to be 1.5 days is now down to 4 hours, which starts to create attention at our customer base. It's a fully walk away solution that you can start it in the evening and have it in the morning or get it going in the morning and do a lot of other things in parallel. And it's very user friendly. So at the end, and you will see this for the audience that is here today in the demonstration of the Fluent system this afternoon. It's really very simple to use. It's one button to press and get the respective application going. It's very much integrated also in the sense of the instrumentation that is within the Dream Prep. So we have, of course, thermal devices and shakers if we need to cool or heat respective elements. We have on deck thermal cycling integrated. We have a plate reader integrated. And all of this is possible by leveraging the functionalities of the Fluent, right? It's a 3 arm system, and 3 arm means that we can do pipetting, we can do plate transfers, we can do complicated liquid transfer application that others can't do that in this in a similar way. And those genomic workflows have, I think, a very relevant implication, right? One of the key concerns of everybody doing genomic analysis, working with DNA is contamination. You need to make sure that if you have a plate of 96 DNA wells and you're transferring liquids that you better make sure that nothing of well A goes into well B. So excluding contamination is a key requirement. And the most straightforward way to do that is to use consumables that are used once in the respective workflow. And the requirements for those consumables, careful listening to our customers, are very high right, because they need to be DNA, RNA free, right? They need to be free of enzymes that kill or digest nucleic acids, right? They need to be sterile, and they need to be transparent to allow a visual control of the overall liquid handling. And I think those are all elements that went into development of the consumables and mostly pipette tips that we sell for those genomic workflow. So genomics is a very positive driver for those consumables. But I think it's important to say that those consumables, right, are as important as the overall instrument. So it's the combination of the instrument and the respective piper tip that at the end guarantee the performance of the overall system. Therefore, it's so key that we are up to and able to deliver the overall quality that is needed. Also, I think I'm very proud to say that having all those consumables out there, the question around sustainability, the question around how do we treat waste is something that is on top of our agenda, and it's something that we have been addressing over the last year and will continue to address. So we're very thoughtful, designed new packages, new racks and piper tips always under the assumption can we reduce plastics, can we reduce waste that is being created. And over the last 2 years, we were able also to launch some pipette tips that exactly fulfilled those criteria. And going forward, we are going to continue to focus on that area. All of the discussion around Dream Prep, the ability to cover the workflows out there wouldn't be possible without our core instrumentation technology, which is the Fluent. Some of you might recall that mid of no, beginning of last year, we launched the Fluent GX. The Fluent GX was the last kind of launch in the families of the Fluent. Fluent GX comes with all the capabilities of the Fluent, but also with the regulatory requirements to run such an instrument in a regulated environment, which if you think about the discussion around genomics, where do a lot of those tests that are being done happening, what are the areas where those instruments are being placed? The Fluent GX is, place those instruments in a regulated environment. Place those instruments in a regulated environment. And I talked a lot about genomics for the Fluent. And with the NGS Dream Prep, we have a solution that is very dedicated for this kind of application. But the Fluent itself, I think that's one of the strengths also of the platform and one of the strengths of Tecan, was designed to be kind of very flexible and very open so that we can adopt it for a lot of different workflows that we are looking at. Like cell biology, I will talk about that in a second. Like applications in protein sciences, we will also talk about that today. Other genomics applications like synthetic biology, LCMS, biobanking or also applications in the oral forensic space. What you see here is just and I'm not sure if that for our viewers on the web that's visible, but a couple of visuals to give you an impression of the overall flexibility and what the instruments can be used. What you saw in the middle was is the robotic arm moving plates around. And it has, I think, probably some of the features that people assume as, oh, this is quite normal. But if you think about it, it's really unique that the arm is able to move around the overall deck knowing where are all the different positions and really finding its optimal and fastest way around, which sounds yes, so what is it about? That in combination with the capacity that instrument has drives a strong productivity, increasing of the overall instrument. So coming back to a topic that Achim raised in his presentation, the unique capability of Tecan to go from life science research into in vitro diagnostics. I think it's something that we've been talking about a lot. So one of the unique identifiers of Tecan is that we are in the position that just by talking to all the different customers and labs out there, we understand very quickly what are the new applications and new trends coming up. And if there is, for example, a diagnostic company who wants to develop a molecular assay, it's very likely that they start with one of our instrumentation instruments. And we can give them and show them the path of what does it mean from a research instrument to take it and then deliver a frozen solution that they can really then go out there and sell. And genomics, as I said in the intro, is an area where our customers exactly went that path. They started with Evo System for nucleic acid applications and then realized, oh my god, there's a big demand around this overall system. Let's find a way to deliver a frozen solution. And that's exactly then how the overall partnering elements came in. But I think this capability of having a very strong research position combined with a strong regulatory know how to be able then to transfer it into an environment that requires consistency, reliability, requires consistency around result is, again, I think, one of our key differentiators. So what are the examples that we want to call out here? It's one of our key clients on the partnering side, which is Abbott. It's the Abbott's M2000 SP and the M2024 SP, which at the end started off on the EVO system that you see on the left. It was a kind of standardized genomics workstations for the purification of DNA, RNA for the cleanup of the DNA, RNA and for the quantification and the setup of the PCR. So it started off with what is on the left and I think ended into a very dedicated and tailored system on the right with 2 elements differentiating around the required throughput of the different instruments. Another example is also around nucleic acid purification. It also started on IEVO with proprietary reagents from one of our customers, where they do nucleic acid purification. Example we are calling out is from Centur Biotech. And if you look at the picture at the left, that's where it started off. That's how we got the development going. If we then look at the picture on the right side, it's a dedicated system with the branding of our customers on it that is doing the nucleic acid extraction exactly with the reagents that our customers provided. And the reasons why we're calling out also those examples is that they have been very successful in establishing those kind of technologies in the market. Good. So that was most of the kind of genomics topics that I wanted to cover in my presentation today. I think as I said at the beginning, the market fundamentals that we see, we are convinced they're going to stay. If so I wasn't part of it, but if I don't know Silicon Valley in the '70s could be compared to it, probably it was like that. It's kind of new innovations coming up everywhere. And I think we are incredibly excited that we can be part of this overall journey, but also that we as T can have instruments that can help to advance the overall science around genomics studies in a very, very dramatic way. And that's also why I'm very pleased today to have, as I said at the beginning, one of our customers here. And we will have Joy present us how our DTEK instrumentation was able to help and improve the overall productivity at Embry. So Joy Krendel is the Director of Asset Development at Embry Genetics. And some of you might be aware, Embry Genetics was acquired by a Konica Minolta company and is a leader in clinical diagnostic software and testing solutions. Joy has been with Embry for about 10 years. I think was on there very early in establishing one of the very early genomic assays that the company was doing. And she was instrumental in what Joy will talk about establishing the super lab at Embree, which I think we are also very proud of. The TECAN instrumentation was probably instrumental for giving Embry the opportunity to deal with this throughput that was required at that point. So therefore, please join me on the stage, and she will give you an overview on Ambre Zogenetics. Thank you. I just wanted to thank Techem for inviting me out and giving me the opportunity to tell everybody here a little bit about Ambi Genetics and our collaboration with Tecan. So Ambiage Genetics is a molecular diagnostic company. We were founded in 1999 and have a staff of scientists, genetic counselors and physicians. These people along with our clinical laboratory scientists have run over 1,500,000 assays in our lab and I have identified over 50,000 mutations. Ambre has a long history of first in our market. We were the 1st company in 2,007 to use next generation sequencing for molecular diagnostics. In 2011, we offered the 1st clinical exome assay. This is essential in helping the medical field resolve those rare genetic diseases. I'm not sure what's going on. And in 2012, we were the first to start the movement towards multi gene panels as opposed to these single gene assays. In 2016, we had our ATG lab founded. This lab is focused on resolving variants of unknown significance, which are mutations where you don't know whether or not it's pathogenic or harmful to the patient or just completely benign where it has no impact. Ambre has developed over 500 different unique genetic testing assays which makes us the world's most comprehensive genetic test menu. We are focused on over 20,000 genes with our rare diseases, our hereditary cancer, cardiology, neurology and our somatic testing, where we take a unique approach of pairing germline test with the somatic test to help resolve those mutations. All of this creates a lot of data that we then send through our proprietary bioinformatics pipeline. This is known as AIVA. This pipeline helps us identify mutations in the data where we can then send it back to the lab and confirm those mutations with secondary assays. We give all of this data to our reporting team which is comprised of the genetic counselors, physicians and scientists so that they can qualify it as benign, pathogenic or if it is unknown significance. If it is of unknown significance that then is sent to our ATG lab where we can conduct RNA functional assays that are reviewed by a core team of structural biologists and medical experts. Of the 92% of the VUS sent to the ATG lab, we are able to reclassify 50 2% of them to be pathogenic and 40% of them to be benign, giving these patients the answers they were sitting there waiting for to either make a medical decision and have surgery or to know that they're not harboring a harmful mutation that they could potentially pass down to their offspring. All of this makes Ambreed not known for its profit driven mindset, but more for our unwavering dedication to furthering patient care. So just to give you an overall perspective of all the different steps in our workflow. As Klaus was saying, we receive samples through the physicians. So they send us either blood or saliva in tubes, which we then extract the DNA or nucleic acids from it and send it through a target enrichment or library preparation process before it goes on the next generation sequencers. After we sequence it that data is sent through our AIVA pipeline where we can identify those mutations. Those mutations if identified go back into the lab where we can run secondary assays to confirm that they're real and not artifacts from the sequencing. All this information is sent back up to the reporting team where they can assess it, classify it and report it out to the patient. So the majority of these steps take place within the laboratory from the sample extraction to the sequencing and then back to the laboratory for that secondary assay confirmation. However, this entire process has an overall turnaround time from the time the sample was received to the time we generate a report. So once we offer an assay with an associated turnaround time, we have to maintain that turnaround time or decrease it. So this creates a burden when we're trying to increase our sample volume without a way to scale it unless we add additional resources. Which is why in 2012 we looked at adding automation into our lab. This is where we evaluated all the different liquid handlers on the market and decided to go with TECAN because of their reliability and also just communicating with other customers in terms of scalability. It seems like you could purchase a new instrument, install it in a very short amount of time and it will work right away, which was key for us. So the first thing we decided to automate was the normalization step. Previously in California, it requires 2 CLSs. So one person to actually do the pipetting and another person to check that they were pipetting correctly. This would take about over an hour for 96 samples in 2 people. Once we automated it, it only required 1 person to walk up to the instrument, put the samples on the deck, hit go and 12 minutes later, your samples were normalized. This had an immediate impact on our FTE time. We were looking at other very easy to automate manual steps that were just taking up a lot of labor time in the lab. The video on the left shows tubes. These are the sample tubes that we're receiving from the different sites that we have to scan into our system to show that we're when receiving them into extracting from them. We just added this device called a POS ID onto the EVO system and it took mere seconds to scan 16 tubes which again as CLS was previously scanning into our limb system 1 by 1. We then realized that the deck space on these instruments were very, very precious. So we wanted to maximize the capacity that we can run on each instrument. So on the upper right hand side, you could see 96 well racks. That has the same amount of samples as one of those matrix tube racks in the upper right hand side. So just by switching our labware format, we were able to increase our capacity by 3 times the amount. We also switched everything we possibly could to 96 well plates so that we're only tracking 1 barcode instead of 96 different barcodes. This result in a 25% to 100% or time increase of samples each individual person was able to process a week and allowed us to open up the floodgates to our sales team to say you can send us more samples. After that, we opened up the super lab to just handle the sample volume increase we are experiencing. So we wanted to design the super lab to have maximum instrument capacity and productivity which is again why we looked at the market and reevaluated all the the different liquid handlers with a fresh pair of eyes. We decided to again go with Tecan, but instead of their EVO systems, their new fluent which had the largest deck capacity out there on the market as well as the fastest arm movement time to really increase that productivity that we were going for. The opening in the Superlab is why it caught Comic and Manulsa's eye. So they acquired us along with INCJ for $1,000,000,000 in 2016. One of the things that Konica noted about the superlab and why we were so eye catching to them was the way we were maintaining sample integrity even though we were processing such a high amount of samples. They wanted to leverage this to expand our reach out to pharmaceutical companies and offer our genetic assays to them as well. So just to better illustrate what I mean by sample tracking and sample integrity. Right after DNA extraction, what we do is, molecular barcoding assay. So essentially, just like you see on the crime shows we get a DNA fingerprint from that sample. We then have that fingerprint stored in our limb system and have downstream targets in our NGS sequencing that have those same targets. So we're able to on a molecular level match up a sample that we received and extracted with that final result to make sure they are the same. In addition, we ensure that every sample and tube and plate is assigned a unique barcode that we can track through the lab. So we can actually track the entire lifecycle of a sample through our lab knowing exactly what reagents it was aliquoted with, what lab where it was placed on, what instruments, what people touched it, all of that is generated into a report. We also implemented something called barcode based pooling. So a common potential risk in the lab is somebody loading a plate wrong. So we only barcode plates on certain sides just in case an end user loaded it wrong, the TCAM would not scan it and they would error out and they would be able to correct it versus just aliquoting the samples straight and potentially having plate flips. So that is something that we were able to implement on all our new Fluent systems. And all this generates an electronic audit trail. So we're able to show and prove to regulatory bodies that all these things actually happen real time. This is a much better approach than the traditional method of paper based tracking. So which has now been identified as high risk by regulatory bodies just because it's so prone to human errors. Another thing Konica really wanted us to do is to reevaluate if we were efficient efficiently processing the samples with cost savings in mind. So we looked at potential labware reformatting once again since we knew that had such a high impact on our efficiency in the past. And the new Fluent systems offered a very precise way of pipetting. So we were able to transition our 96 well plates that we previously reformatted to into an even smaller 384 well plate. So the 384 well plate is just made up of 96 well plates, but has the same deck footprint. So essentially the wells are a lot smaller and you would never want to manually pipette in and out of these plates. But because we're on an automated platform, we could reformat to these plates. This increased our capacity automatically by 4 times. It decreased the amount of peripheral equipment we needed to purchase to scale up. So instead of buying 4 thermo cyclers to process 3 84 plates, we're able to just purchase 1. And then it decreased the amount of waste and consumables we required. It also allowed us to reformat the actual reagents and reactions to at least half the original percentage, if not more. This had a major impact on our COGS and our walk away time for the instruments. You could see the image on the upper left, those are just 1296 well plates. Well, that makes up just 3 of these deck positions on the Fluent on the right hand side for the video is playing. So each one of those little black spaces is the potential for another 384 well plate. So this allows us a lot of scalability. And in terms of lab processing to add another 384 samples, it's just an additional plate on the deck. So the lab really never feels the impact of that sample volume increase. So another thing we wanted to do with all these new instruments, we wanted to ensure that we were using them as efficiently as possible. So we reached out to TACAN to see if there is a way they could help us look at our data files to show instrument up and downtime. And they happened to be working on a new software called Introspect, which they recruited us in as an alpha user for. And it was interesting because immediately once we put this software on the TCANS, it just parses out your log files. So it gives you the real time data. And we noticed patterns such as our night shift crew utilized the instruments less than our day shift crew and they also had more errors. So I was able to make the business case to hire another person dedicated to just training and supporting that night shift crew so that we had less re preps and we were able to utilize those instruments efficiently. And just within a matter of a couple of weeks, we saw that instrument utilization normalize across shifts. Another thing we use it for is easy visualization of that overall utilization across days of the weeks, months. So we can see if we're forecasting plugging in a new assay will actually work on our existing systems. Are we going to be jeopardizing our instrument redundancy or will we have to add a whole other shift to people in order to make it work. So this again enables me to build a business case to purchase 9 more fluents recently because we're trying to launch a new clinical diagnostic assay. So it brings the super lab total of t cans to over 50 instruments that are still active in the lab. So, the overall payout for all these efficiency efforts was a large saving on our COGS initiatives. Even though our sample volume was steadily increasing, our cost was steadily decreasing with the implementation of the TEC influence and the 384 well processing. We also over the last 2 years suffered a 31% decrease in headcount. But even with that loss of headcount, we had a 63% increase in productivity per person. And finally, the overall impact of turnaround time. So in 2016, we had an average turnaround time of about 20 days. And since the implementation of all these efficiencies, we are able to consistently deliver a 10 to 14 day turnaround time for all of our assays even though we have increased our sample volume by more than 4 times the amount we had in 2016. So this allows us to deliver reliable results to these patients that may be awaiting life altering decisions as well as expand Amry's reach into the pharmaceutical companies or just furthering patients and incorporating all this to further the impact Amry has in the field of precision medicine. So I just want to take time to acknowledge the Tecan support that I received over the years. They have been instrumental in the design and implementation of all these instruments, as well as my assay development team and assay automation team and of course the clinical staff who actually run the instruments on a daily basis. Great. Thank you so much, Joy. I think we are running good in time. If there are any questions maybe on Joy's presentation, we would be willing to take them now. Otherwise, I think we will have a Q and A session at the end. So are there kind of 1 or 2 questions from the audience here around Joy's presentation? Yes, please. Just one question. I mean, you were saying you were elaborating Tecan versus other offerings of competitors. I mean, the numbers are impressive, but what in your view was really setting apart Tecan of those peers? So the first time we evaluated Tecan back in 2012, the thing that set them apart from the major competitor was the way we can do infield upgrade. So a lot of these competitors, if we decided to change the format of our instrument, we would actually have to put it on a truck and ship it to another state for them to do that update, which would mean that instrument was completely down for that whole time. So we wanted something flexible that we could upgrade at ad hoc almost within our site at Ambre. The second time when we were reevaluating everything is really the deck capacity and the speed. We kind of had the reformatting and our assays down and we designed these new instruments to be more customized whereas the first instruments it was more about scalability. So the Fluent it's on an EVO system it would take 12 minutes to normalize those plates on a Fluent system it takes about 7. Any other questions? Thank you. Once you have installed the tikka and Automation in your company, how is the aftermarket working together with Tekken? How often do you have to have people from Tekken in your company? So we have an on-site engineer, so every day. But it's more just to provide support in terms of training, implementations. It's not necessarily instrument downtime. Prior to opening the super lab, we probably had an engineer on-site once every couple of months. The troubleshooting of the instruments is pretty self explanatory. It's just our sheer volume of instruments now warrant somebody on-site. Yes. Thank you. Any other questions? One, yes. Yes. Thanks, sir. You mentioned that at ANBRY, the focus has been very much on the quality of the data and the sample and the integrity of the data rather than focusing as a profitable entity. But you're doing incredibly high volume next generation sequencing now. Is the end game and the fact that you're now under corporate ownership to become more of a clinical service rather than a charitable service? And are you pushing forwards to develop next gen into the clinic rather than the academic setting? So one thing that Konica was aligned on with Ambre was that vision of putting patient care first. So that again has been extremely helpful in justifying additional purchases just because we want to ensure we're delivering the fastest result to the patient. Even though it may cost us a little more money upfront, that is something that Konica and Ambre were both aligned on. Okay. Good. Joy, thank you very much. For the team present here, All right. Welcome back and to the Tecan Capital Markets Day. We go into the 2nd session, And we will continue now with the applications. We will talk about cell biology applications, which is one, I think, key area also for Tecan. And we will look into proteomics, understanding what kind of trends do we see there and how does our offering give customers an overall advantage. Also, I'm very happy that in the Cell Biology section, we will talk about also new products, right, that we will launch by the end of the month. For the team here in the audience, you will have the opportunity to see the demo this afternoon. For our colleagues on the web. I just can encourage you, please have a look at the website. There is already some information available. All right. Let's get started. So we kick off with the cell and tissue analysis, then protein analysis, and we will also have customer presentation around the protein analysis. And again, I think a great example on how our technologies can help customers and at the end can help to even get better diagnosis of diseases. So for cell and tissue analysis, what I want to talk about today is give you an idea on what kind of capabilities do we have to capture the opportunities in that market and what kind of products are required. There is a topic around imaging and imaging technology, but also a topic around work flow, understanding workflow around cells and being able to capture this workflow. So let's have a quick look at the market. Again, I think a larger market within the life science space and also with some very positive growth driver. One that we called up on the left side of the slides was the cell based assays or cell based disease models. They have been around for a long time. People thought about cell based disease models more than 20, 30 years ago. But with the advancements in technology, with the advancements around induced pluripotent stem cells, we are now in a situation that companies are looking much more actively into creating cell based disease models, be it in 3 d cell applications or really just in suspension or inherent cells and using those models to drive new discoveries, new discoveries around therapies and new discoveries around biological drugs. That haven't been possible in this way and in this throughput just 10 years ago. Then a big contributor to the overall cell biology was the cell engineering and bioprocessing. That industry or that segment has seen double digit growth over the last 4, 5 years, clearly driven by the need of biologics and the progress that has been made in the production of these cells, but also the complexity of cell based workflows. I think for anybody who has a biology background here in the audience, it knows that cultivating cells and making sure that the cells are then in the perfect state to run your assay is not the easiest task. And the more complicated it gets, if you start to work with primary cells, the workflow starts even to get more complicated. And this complexity around the diversity of the different cells now requires also authentication solutions that make it easier to cultivate a big variety of cells, but then also to be able to run their respective assays. And I will comment in the second part of the presentation around the capabilities of what we call the Tecan LabWorks group, which is our customization group that is exactly specialized to deliver solutions for those kind of applications. So what is our product portfolio with that we can use to address this market. For cell culture, cell engineering, it's our liquid handling platforms, it's the Fluent, it's the EVO. I call out here the LabWorks group because those workflows are so complex. They require different incubation condition. They require dedicated instrumentation along the workflow. A lot of this happens with our customization group there in the Tecan LabWorks group. For cell based assays, of course, we have again the automation instrumentation. We have picoliter dispensing tools like the D300, which if you think of applications where you do those studies of small compounds or where you try to do where you try to understand synergistic effects between compounds, the ability to pipette really picoliter volume so that you don't need to do dilution series is just, again, improving and speeding up a lot of those workflows. Of course, we have washers in the portfolio and again also the LabWorks team integrating that. On the detection side, there is the Spark multimode reader that I will comment about in a second, but also the new Spark Cyto, which is the product that's going to be available at the end of this month to the market. And for the audience here, on your back, you will see there is the Spark site shown as a functioning model that will be demoed this afternoon. Spark, it's our multimode reader platform that is being used for cell based SA applications. It's been out there now for 2 to 3 years. And I think seeing a lot of positive acceptance feedback from our customers. That's mainly driven by the ability to be flexible. We can configure the system. It's upgradable in the field, you can develop new applications and get new detection modes as a setup. It comes with the ability to control the environment, But if you think about cells cultivating cells, keeping temperature, keeping CO2, keeping the environmental conditions is key. It has a unique capability to adjust the temperature upwards, but also adjust the temperature downwards. So once an assay has been done, you can chill down the cells so that they start it's also that they stop their overall metabolism and you can do, for example, analysis at a later point. There are also a lot of other technological elements in the Spark that we have IP protected that give it a unique angle out there. What you see here is now the new SparkSaito, right? I think it's the first time that we talk about it in this context. It's been a development that has been ongoing. And I'm very proud to say that we now have a product that is probably exceeding expectations that we had, is exceeding also customer expectations. It went through all the better tests with our customers. And so far, the feedback was very, very positive. Any question is, so what does it make unique in the sense of delivering on unmet needs. And it's sorry, that was too fast. It's about what we call real time cytometry. So real time means that you can run your experiment and start to measure multiple parameters in a well, it making images that are fluorescence, measure absorption, measure fluorescence in one go and then do the analysis in real time and decide what you're going to do with that information. And you can do that in time intervals that at the end the user can define. So what we realize is that it will be very difficult for a researcher to miss one of the critical events because cells do not grow the same, they grow at different rates. They might even react differently at the different compounds added. And with the instrument, we can now make sure that in any of those experiments, we don't miss those data points. You see that the ability to cultivate the cells, so you can put in the plate and just let the instrument run for a day, 2 days or even a week to get the overall analysis going. It's real time in the sense that you can do the analysis on the spot and then decide what are you going to do with that information. The example that we call out here is a very typical workflow in a lab where cell viability needs to be assessed, cell confluency needs to be assessed. And based on the input of these two parameters, a decision is being taken on what's to happen with the cells. So for example, you want to assess the impact of a compound on cell viability across different type of cells. You can cultivate the cells. You can set the trigger point around conferencing. At 70 conferencing, you want to add the compound. And then you can define at what stages you want to measure then the respective impact of the compound. You will see a demonstration of the capabilities later this afternoon with a very, very similar experiment. And I think the big advantage and also I think the unique identifier that we currently see is around the capability to do these things in a defined environment and to do them in real time. Okay. Good. I mentioned at the beginning our LabWorks capability, right? LabWorks is a brand that we launched mid of last year. LabWorks is all about delivering customized solutions. So why I'm calling this out here in the context of the cell biology. At the I think what I mentioned at the beginning, the fact that cell biology workflows are so complex because cells are so different, right, it's very it's, let's say, difficult to come with off the shelf solutions, say, oh, you use this instrument, it will deliver what you're looking for, but it requires a lot of customization. And to be able to do this customization, it requires also a lot of understanding of the process. It's not possible to customize a cell workflow if you have no idea of what the overall customer is going to do. But it also requires a capability where you're able to then also maybe engineer, right, certain elements or parts that are so dedicated for this workflow so that you're able to overall automate it. And you will see later in the presentation a quote of one of our customers. And every time I see that quote, this is, I think, really what LabWorks delivers. And you will see it, but to give a little preview, it ends with we are now able to do things that we couldn't do before. And that's really the value proposition what we're going into with LabWorks. What you see on the next slide is our 2 videos around custom engineered parts, right, and how they're able to deliver along the overall workflow. While the video is running, I will just comment a little bit on what you're seeing. So on the top left, it's a customized system with very specific tubes to cap and decap them, right? On the right side, you saw a system with also dedicated tubes where a rotation device came in. On the left side, you see the video running with the capping, decapping. It's if don't know for the ones of you who have been in the lab and remember trying to cap or decap of 1 of these tubes, It sounds very straightforward, but if your collar goes workout every day and is closing a tube, you probably need a different effort to open that tube. And to automate such a manual process in a way that it really works and works consistent across the different tubes is a very big challenge. And I think it's one of the key parameters on why the understanding of the overall workflow for those LabWorks protocols is so essential. So to give you an example on for example, induced pluripotent stem cells, It's been around now for quite some while since the methods around were discovered. But the ability to do this in a kind of large scale environment, to use this for research and therapy have been limited because the overall ability to automate that process has been so difficult. So I'm proud to say that we have been able to automate this process now at a lot of different sites, right? We automated the process, for example, for retinal cells, where retinal cells are differentiated and are being used now as tool for further therapies. What makes this capability so application is, of course, we have all the engineering know how and understand how software and those robotics works, but it's the capability of the team to understand what our customer wants. So if we are in the situation that we are looking at the cell workflow and the customer asks us for an automation proposal or how can we increase his productivity, we approach this in a very team oriented way, right? Of course, we have the salesperson that understands the requirements and is there to interact with the customers. But then we go in there with the application scientist who has normally a PhD background, is very deep into the science, understands what's happening. We go in there with a service engineer, a service engineer who is bringing a perspective, oh my god, if I need to add 20 instruments along this workflow, what does that mean? We go in there with a software engineer. That brings the perspective what do we need to adapt along the workflow on our customized software to be able to translate that? Or is there a need to even develop new software? And it's this teamwork approach that at the end enables us to really understand on detail what are the customer requirements to deliver the solution. Because you can imagine that somebody if you have developed an essay and you are very good in labs and are very good in pipetting and you know it works if you run around. And you know it works if you do it during lunchtime because then the centrifuge in the lab above is not running, and you know it works because your colleague is not here who interferes. And if you start to take those things into account and also put that into the diligence of delivering that process, you start to realize that it's much more than just, yes, I need to pipe at A from B, but it's really about understanding the overall workflow. And I think that has been a very successful capability. And over the last years, we used it as a kind of tool for the sales rep. So if the sales rep came along, hey, this is this could be a LabWorks project, he mentioned that we have that capability and the LabWorks team that sits here in Menador picked up this overall project. Now considering the success that we had, we decided mid of last year that we want to call this out and want to really create a brand around it and really drive the go to market to be able to capture all the opportunities that we have out there. So an area, I think, that will be important for Tecan going forward because it's, I think, really brings it to the point what our customers are looking for. And you see here the quote that I mentioned before, and just let me read it out loud. With this system, we can perform experiments in a completely different way. It has given us the opportunity to develop and test processes that we simply couldn't do before. If we get that kind of feedback, then we've done a great job. And it's at the end, this kind of insight, where we see that being able to deliver this automation solution is really advancing what people is doing, right? It's freeing up their mind to think about other things or it's freeing up their mind to take now results into account into a faster or broader way on how they're going to automate their oral instrumentations. And I could now continue with 20 other slides and more around examples of where this customized solutions really created impact. And it goes into all directions, from just very simple cell based assays, from cell cultivation, from bioprocessing application into direction of also personalized medicine, applications that handling. So the cell biology capability, how does this play in the context of what you start to realize is going to become a recurring theme in the presentations today about the transition from research into diagnostics, right? And again, why is that capability not only a great offering for our research use customers, but why is it also working out now on the partnering side when transferring into diagnostics. And I wanted to call out three examples that at the end use living organisms, use cells, use tissue that come from a research environment into a frozen solution regulated environment. Example I'm calling out here is endotoxin test, right? And the toxin testing, highly critical and important to make sure when you do injections, when you have biological samples, that they are free of endotoxins. And what you see on the left side is EVO example that comes with a standard configuration to automate this endotoxin testing. And it turned into a customized solution for Lonza, the Purotech Pro Robotic solution that does automated endotoxin testing. And I think at the coffee break, I was just talking about, so how does this transition work, right? So do our customers come to us with, hey, I need something at the right? Or do our customers come to us, say, I have this running in the lab. It works so great. I would like to make a frozen solution and sell it to our customers. Well, at the end, it's probably both ways. But the prominent one is that somebody in the lab of this company, they established a workflow around our system and start to realize, oh, we would like to get this out in a regulated environment. And that's how then the overall frozen solution is is being developed by the partnering team. Another example is sample prep for flow cytometry, something that we do in the research setting quite often where a flow cytometry system is at the back end of an EVO or a FLUENT, what you see on the left side here. On the right side, you see an example of also partnering project that is now using a different modular platform. It uses the Magniflex platform that our part that we use in partnering now to deliver very tailored solution. It started off with an automated EVA solution to do proof of principle and see, oh, does this work? It turned out that the customer requirements were around space. It only could have a certain footprint where we then used other elements in our instrument portfolio on the OEM side and then to deliver very, very dedicated solution. Here, the example around the PS10 for Sysmex. Another example, which you probably are aware of, but let me share you how we how the overall tissue stainer that we are selling as an OEM product to Darko came together. There was a research project on the left for a dedicated system called GenePaint at that time, that automated actually the staining of tissues on slides. And that application was the starting point to think about. So if for a defined regulated environment, what does it take? What do we need to do to develop it into a system that makes it so easy for our customers to use? Because one of the, I think, probably, let's say, biggest differences between what is running on the left side and what is running on the right side of this slide is the usability. On the right side, normally, non skilled personnel is using this kind of instrumentation. So it needs to be bulletproof in the sense of what can go wrong, how to fix it and how do customers interact. Whereas on the left side, it requires an experienced user. And I think looking at the history of the partnering projects, I think we always supported it in a very dedicated way to really transition also this interface and usability away from a highly flexible solution to an overall frozen solution. Okay. I think that was what we wanted to cover around different cell biology applications. As I said, to quickly recap, Sparxcyto, you will see this afternoon, it will come to market at the end of this month at SLAS. And I hope you got an impression around the Tecan LabWorks capability. It we will be very vocal about this capability going forward. It's the custom engineering, let's say, high end capability where we're able now to address workflows that others just can't do, right. Good. So what we're talking about now is protein analysis. And there are 2 elements to this section. We will talk about the relevance of protein analysis of mass spectrometry for Tecan. What is our position in that space? How do we see market fundamentals develop in that area? And we will have a customer presentation from Stephen Harding. He's the CEO of Binding Sight. I think, unfortunately, he couldn't be here today because of some air traffic problems in London, but he will dial in via phone, and we'll have the ability for him to present and hear how we are adding value with our instrumentation for the binding side. Good. So protein analysis is, again a very kind of broad area to look into, but it has some very specific verticals that are highly relevant for us. One of them is mass spectrometry, and I will spend some time in the presentation to guide you through how does our position in mass spectrometry look like. I will give you an update on TECAN SP, the consumables business that we acquired back in 2016, the progress that we made since then and have also a point of view around the technology and instrument portfolio for this area. So mass spec, right, let's start off again with a view around the market. It's an attractive place to be, right? You see market fundamentals are positive, mid- to high single digit growth. The sample prep in mass spec is also high single digit growing segment. And I was just reading this morning the summary of the ASMS conference. I think that was the American Society For Mass with Spectrometry that is just happening right now. And I think they mentioned some of the or confirmed some of the key trends that we are really highlighting up here. It's the high end proteomics. So high end proteomics means analysis of protein peptides for biologics applications, for therapeutic applications, but also for applications around QC and pharma, right? And I think another point that I think was also mentioned was the innovation around workflow. So people now because MS has been around for a long time, it has been for a long time, an expert instrument. You needed to have a Ph. D. To know how to run an instrument. That has gone, right? Instruments are now much more accessible to unskilled people. And with the combination of required higher throughput, there's now really a large population of users looking at, oh, wow, this is my workflow. How can I start to optimize that? I did everything manual. I was taking the tubes out, putting them into centrifuge. There must be a better way to do that. And it's what people right now think about, right? And I think it perfectly captures the trend that we see how Tecan with its instrumentation can add value to this. So let's look into that. Mass Spec, I think what we wanted to call out here is one area in parallel to other verticals where we provide solutions. So we will focus on mass spec. I will spend less time on the other ones, but just calling out the protein purification and the bioprocessing. This is an area where we have a leading position in the development of the best kind of purification conditions around biologics. Then crystallography, the automation of these processes that require high throughput and high number of samples to find conditions that give you the structural information around proteins or just the protein detection and analysis, leveraging our detection capabilities around measuring absorbance, measuring fluorescence of protein protein interactions. So what I will talk about is now mostly our offering around LC MS and the progress that we have made on the Tecan SP side. So MS Sample Prep, right, similar to the NGS workflow that I showed before, there is an area where we need to focus down and prioritize. The end, it's one typical workflow in the industry. You start with the sample, you come with the sample collection top all the area around mass spec All the top all the area around mass spectrometry, the chromatography and the data handling and analysis is already incredibly well covered by key players out there in the market. I think that's not the area where we think we can add value. The focus area is really building on what I just mentioned before. Now the workflow optimization, the handling of higher throughput of samples and the fact that the democratization of mass spec is happening and less skilled people people want to use this instrument. It's around the sample preparation and logistics. The extraction, where we have a great portfolio with our TKNSB product and the automation and the preparation of the samples. I don't know how many of you have been in a mass spec lab, but if you see how samples are prepared and how they are funneled into the overall MS systems, it looks like a molecular biology lab probably 10, 15 years ago. So the need now to automate and take care for the higher throughput that is required is a key trend that we see across those labs. That's one of the reasons why we say extraction sample prep logistics with the capability of understanding workflows and having the automation equipment is why we want to focus on it. So what kind of product do we have in this space? It's the automation solutions that can do SBE, LLE, dilute and shoot, for the ones not familiar with all the acronyms are those are different ways how to purify proteins. That's something we do with our existing instrumentation. Then we have benchtop instruments. Those were instruments that we acquired in 2016 through our acquisition and continue to develop. What you see in the middle, the Resolvex A200 is the next generation instrument that we just launched last year out of that. We have the consumables portfolio around the chromatography applications. We have modular systems, and those are systems that are being used by our partnering team to provide now dedicated automation solutions. We have components that we sell into the space, components that go to other mass spec providers and also great software tools that Joy mentioned, Introspec being one of them, but we now started with a suite of software and tools to connect our instrumentation with the user, to connect the Spark, to connect the Fluent so that you have a walk away solution. You can sit in the cafeteria at home or at your desk and always know that if you don't get a message from your phone, your experiment is probably doing what it should be doing. On the sample preparation itself, there are several technologies we can use and that we can offer. On the Tecan SP side, it's mostly driven around solid phase extraction protocols that you see summarized up here. The liquid liquid and dilute and shoot is an area that we cover with our automation systems. So I talked about this already a little bit. The product portfolio that we got out of DK B, I think, was on the left around the columns. In the meantime, we were able to also launch the NBE columns, the narrow bore extraction columns, which again deliver an advantage in the overall workflow. We launched the A200, which is a positive pressure instrument. I know it sounds very simple, positive pressure, but it has kind of some very unique capability. I think, the only instrument out there that is able to deliver constant pressure on each well of a 96 well plate. And so if you push a liquid through and one has 5 ml and the other one has 1 ml, no matter if the 1 ml has gone through already, the 5 ml still gets exactly the same pressure to put the liquid through, which is very important to get consistency around different results. The example we caught up here is just I mean, we picked one of the many, the phosphoproteomics workflow, where the ability now to automate this positive pressure in a 9 to 6 well is again driving productivity and enabling experiments that before would have taken days or people wouldn't have done it because the number of samples that have come out of it was just what would have been just too high. And so I don't want to go into details, but at the end, the workflow works that you need to start off with You have a process to create fractions of 1 sample that has different information in there. And then you need to use these different samples and put them against repurification step before you can put them on an overall mass spec instrument. And if you start with 96 on the left and each sample gives then 20 other samples that they need to go through again, you can easily make a calculation what kind of effort it would take if you do it the traditional way where you take 1 chromatography column out, you centrifuge it, you put it back again and do all of that manually. Coming back to TEC and SP, I think what we wanted to call out is, I think, some of the progress that we made since acquisition in 2016. One is clearly the geographic expansion that we were planning to go after. When we acquired eKNSP, they were only present in North America. We now have a direct presence in Europe, in Asia, in our direct markets. We kind of launched the A200, which is, as I think I mentioned, getting great traction in the market. And I think we're very happy with the performance that we have seen so far around this product. Also, it took us probably more time than we expected, but it was very important to us to upgrade the organization to the TCAN standards around quality and how we run operations. We implemented lean manufacturing at the site because we have a high volume of consumables that are produced and upgraded also the quality system. But we now have a great footprint in with TKNSB so that we're able to get columns in amazing quality and are able to deliver at customer request within 24 hours after receiving the note. So coming back to, again, the theme of transfer from research into OEM. The example that we wanted to call out today is, I think, one of our customers that is going to present. And I will hand over to Achim to introduce the customer and get their presentation. Yes. Thank you very much, Claus. And it's my absolute pleasure to introduce to you Stephen Harding from The Binding side. Stephen, as Claus said, unfortunately could not be here. He tried very hard last night to fly from Atlanta via the U. K. Into Switzerland. But unfortunately, due to thunderstorms, he was stuck in Atlanta and just arrived in London. So we're very grateful that he agreed to dial in. He's on the phone and you will see the presentation in the background and he will speak to it via the phone and he will afterwards also be available for few questions. I'm very happy and grateful to Steen that he took all the efforts to be with us today, although a bit remote, but maybe that's kind of also a great example of modern times and digital connections. So without further ado, I just wanted to introduce Stephen to you personally. And Stephen is the Chief Scientific Officer at The Binding Site Group, a leading specialist provider that aims to provide to improve the diagnostics and management of blood cancers and immune system disorders. Stephen has supported over 70 successful FDA submissions, 70, and was the author and co author of more than 50 peer reviewed papers. And as he was a key driver behind the development of a next generation assay based on mass spectrometry for the quantitation and typing of immunoglobulins. Therefore, I'm very excited that Stephen will talk about this topic here at our Capital Markets Day. So please welcome Stephen remotely. And Stephen, the floor is yours. You're up. Thank you. Thank you very much, Akim. Apologies, I'm not able to be there in person. Unfortunately, the weather gods against us yesterday. Today, I would like to present what we think and consider to be the future of monoclonal gammopathy patient management. The monoclonal gammopathy is an umbrella term for a series of disorders that range from the very common around about 3% of the population over the age of 50 have a disorder called monoclonal come up with the unterm significance to the thankfully less common, but unfortunately still incurable multiple myeloma. So the binding sites started as a spin out company from Birmingham University. And our ethos then on our ethos now is that highly specific antibodies can be used to excellent effect to diagnose, monitor and aid in treatment decisions in the clinical laboratory space. Our area is quite niche. We specialize in immunology based disorders. So the blood cancers as we mentioned, but also the vaccine responses and assessments of your immunoglobulin subclasses. And because we are a spin out of the university, if we could move to Slide 2, please. Because we are spin out of the university, we believe that we're able to be somewhat agile in meeting customer needs and expectations and also have a very good relationship with customers such that we're able to take the innovative research and development ideas and transfer them and transform them into routine clinical assays. If we could move forward to Slide 3, please. One of the other aspects of binding site is absolutely committed to is to publish scientific research without any limitations on our collaborators. And this the graph that we can see here are the number of publications that use our free light or heavy light assays that have been started back in 1999. And as you can see now number nearly 4,000. We're committed to publications because this is how scientists review and talk to one another. So we are able to show that the work has been done to a very high standard because it's been peer reviewed, it's been assessed and it's been published in journals. And we published not only in journal format, but also at meetings. And the technology I'm going to describe to you today, on mass spectrometry technology was awarded 3 prestigious poster awards at last year's American Association of Clinical Chemistry. And one of the comments that was made is that this was a first step to truly meeting an unmet need in patients with these disorders. So let's describe these disorders in a little more detail. If we move to Slide 4, please. So the evolution of multiple myeloma is well understood. It starts with a benign disorder called monoclonal gammopathy of undetermined significance or MGUS. It proceeds through a smoldering or latent stage is called smoldering multiple myeloma. And then finally into the pathological form of the disease as multiple myeloma. Because this is a systemic disease, then the tumor burden is often huge by the time the patients are diagnosed and greater than 10 to 12 cells are present in the patient. To try and put that into a terminology that's a little easier to understand, this would be the equivalent of 2 quarter pounder hamburgers. So a huge tumor burden on these patients. This disorder, move to Slide 5 please, produces the perfect biomarker. And that is because this is a disorder of plasma cells, plasma cells produce antibodies and these are very well characterized and understood proteins. And these antibodies when they're produced by these plasma cells when they're produced by the tumor are singularly specific. And so this slide here where we have our magnifying glass is showing you an intact immunoglobulin and this intact immunoglobulin is made up of 2 heavy chains. They are the light blue chains and 2 light chains and they are the pink chains. And we can characterize these immunoglobulinuses GAM, kappa, Lambda, D and E, of course, rarely. And so when we characterize these, we can use them to monitor patients with multiple myeloma. If we move to Slide 6, please. Now thankfully, whilst remaining incurable, the outlook for patients with multiple myeloma is becoming increasingly better or rather is improving. And what we can see in this slide is a survival probability graph where we have age matched controls from the years 2010 to 2012, 2008, 2009, 2,009, 2,007, etcetera. And you can see that patients with multiple myeloma on a year by year basis are having an improvement in their survival probability. This improvement in their survival probability is down to the introduction of monoclonal antibody therapeutics into this disease space. So the novel antibody therapeutics such as daratumumab and akerelizumab have really improved the patient outlook. If we move to Slide 7, please. Whilst the drugs that are being used to treat these patients have improved on a year on year basis, In actual fact, the tools which we use to monitor these patients are relatively on or have had little improvement since 1990s. So most commonly used tool for monitoring patients with monoclonal gammopathies is protein electrophoresis and the leaders in this area are both Sabia and Helena. Protein electrophoresis started in the clinical laboratory space on in their paper form. It moved in the 1970s to a flatbed gel electrophoresis form and this is the most commonly performed electrophoresis in the world. And then in the 1990s with the introduction of a liquid phase, we moved to capillary zone electrophoresis. However, since the 1990s, there's been little innovation and this is still the tool that we are using to monitor and assess response in these patients. If we move to Slide 8, please. These tools are insensitive. One of the reasons why patients have such huge tumor burden is because the sensitivity of the electrophoresis gel requires around about a gram to 3 grams of protein before it can be detected as abnormal on these systems. So there are 2 forms of electrophoresis. One is called serum protein electrophoresis, this is SPE. The other is called immunofixation protein electrophoresis, this is called IFE. Certain protein electrophoresis is a quantitative assessment that has a limited sensitivity of somewhere around about 1,000 milligrams or 1 gram per liter and below 10,000 milligrams or 10 grams per liter is very poorly reproducible with often CVs greater than 30%. Because this technology does not separate the immunoglobulin from the other serum proteins, the proteins can co migrate and can mask one another. And this means that this technology is a highly skilled technology and requires many years of experience to look at all of the nuances that these gels can offer in patients with a variety of different clinical disorders. Immuno fixation is somewhat easier to interpret. Here we stain the electrophoresis gels with antibodies raised against IgG, IgA, IgM, kappa or Lambda. And when we have a coalescence of the stain and you can see on the gel that the clear stain against the G lane and against the lambda stain, then we can describe these patients as having an IgG lambda para protein. The assay is relatively sensitive. It can detect around about 100 milligrams of protein, but it's a binary decision. It's a positive presence or positive or negative absence. And therefore, it cannot be used to monitor patients to give any understanding of whether the disease is responding to therapy, but rather it's either absent or present. If we move to Slide 9, please. There are other methods of monitoring patients with multiple myeloma and monoclonal antibodies. These include flow cytometry and next gen sequencing and next gen flow. And you can see in this slide that the methods that are used describe different responses of the patient. So electrophoresis can be used to describe a very good partial response. This is called VGPR. The serum free light chain assay, which is the assay that the binding site produce can be used to describe a stringent compete response. So a little further, a little more sensitive. Flow cytometry and next gen sequencing can be used to describe minimal residual disease. However, both of these technologies rely on bone marrow biopsies. And so patients who are not willing to have this done routinely and this is often done only twice in the disease journey, once at presentation and the second time at maximum response. This means there is a big gap and an unmet need here because we know that the patients can become negative by this current serum investigations and we know that we have tools that we can use to look into the bone marrow. But between these two tests, there is a huge gray area where physicians have not got any ability to assess where the treatment is working or whether the patient is relapsing. If you can imagine with a patient who's been biopsied and achieved a complete response and has no disease, the idea that they would go back into the clinic and be biopsied every month or every 3 months to look for the return of the disease is simply unthinkable. And so with colleagues from the Mayo Clinic, if we could move to Slide 10, please. Colleagues from the Mayo Clinic realized that because the each immunoglobulin is individual, then this would offer an opportunity to assess the immunoglobulins from patients using mass spectrometry. The paradigm is remarkably simple. Every plasma cell produces a unique immunoglobulin. We have around 10 to 11 different circulating immunogloblins in a healthy human being. These unique light chains and heavy chains can be visualized on a mass spectrometer and more they can be visualized on a multi system and these multi systems are already in the clinical laboratory space. If we look to the far right, we can understand that the mass of the immunoglobulin can give an indication of clonality and the intensity of which that mass is seen can give you an indication of clonal abundance. So on the left on the bottom left of the screen, you have what is a normal distribution of immunoglobulin light chains that have been precipitated from an IgG beads. We have both Lambda, which is signified by the Lambda symbol in green and kappa, which is signified by the kappa single in red. And this is normal. They are Gaussian distributed. There's no evidence of any Lorenzian or Pseudo Lorenzian peaks here. By contrast, on the bottom right of the screen, we can see that whilst we have some polyclonal lambda and some polyclonal kappa, there is a clear peak and this peak is abnormal. It's being produced above the background level of the normal immunoglobulins as a single moiety that can be identified by the mass spectrometer. Now the reason why this is important and if we move to Slide 3 sorry, Slide 11 please. The reason why this is important is because whilst our current technology charge separation and in a one dimensional separation if you will, the technology that we've developed with Mayo Clinic separates by precipitation and then separates on mass and charge. This improves the resolution of the patient's immunoglobulin markedly. However, what can be done in a research lab does not always translate into the clinical lab. And one of the tasks that we set ourselves is how we transform this fantastic idea into something that can be used in routine use. If we move to Slide 12, please. And we realized that what we needed to do is to have a fully clinical chemistry compliance solution that would be in it would enable laboratorians to load primary tubes through to getting a multi plate in a single analytical handler. So the solution that we're offering is magnetic isotopespecific beads against GAM, capital and lambda immunogloblins, which are then loaded onto a liquid handling system and we'll talk a little bit more about that in a moment. And all of the steps that are required to visualize the patient's immunoglobulin through from the primary tube through to the alluent from these beads and then spotted on the MALDI plates are performed on a single analyzer. And then these plates are visualized on a MALDI mass spectrometer. If we move to Slide 13, please. After many months of discussions and talking with many different companies, the solution that we realized was going to work the best for our customers and for our development was using a customized Fluent 780 from Techem. The final product will be branded with a trademark for the binding sites, but this liquid handler some takes the patient's primary tube, performs all the necessary steps to incubate with the beads, remove and wash from using a magnetic plate and then spot onto a multi plate with remarkable precision. If we move to Slide 14, please. Here we can see a deck overview of the liquid handler. On the far left, we have sample and reagent max. Everything is barcoded on the system. So we have full traceability for patient samples. We have our stacks of disposable pipette tips and magnetic plates and there was a great deal of innovation and discussions around this magnetic plate because we needed a very strong magnet to ensure no carryover whilst we are washing our magnetic beads. We have a customized multi plate holder. We have several troughs of buffers and matrix, a waste shoot, which is in the middle of the analyzer, which means there is no waste going into the laboratory. It's all self contained. And then finally, a hydro speed plate washer. If we move to Slide 15, please. Working with our colleagues at Tecan, there was some customization required to make the Fluent80 suitable for the technology that we wanted to bring to market. We have a customized reagent tube on a cage to prevent the reagents being removed once the run has started. We have a customized patient sample rack and again, the case to prevent sample patient removal. This is all aimed towards a clinical laboratory space. So we can't have patient samples being moved from one area to another. The multi plate holder was an entirely unique design to hold the multi plates from the Shimansu providers. On the buffer trough, which is required to hold the matrix, which helps the ionization of the proteins was designed so that we didn't have any of operation. If we move to Slide 16, please. The other thing that we needed is we needed a fully compliant barcode reader on every single component, including the patient samples through to the multi plates and also the buffers in the troughs and in the reagents. So the system was modified and we had a great deal of engagement with TCAN in order to provide the final prototypes for us. The question there, of course, is did these prototypes help achieve some of our goals, I. E. Improving the precision of the patient analysis. Excuse me, somebody is just passing. If we move to Slide 17, here we see the performance of the Tecan system for spotting a group of patient samples out. So we have a number of normal patients and we've spotted out the immunoglobulins that have been precipitated from the IgG beads. So we can see IGG Lambda light chains and IGG kappa light chains. The area to focus our attention is to look at the ratio of the kappa to lambda, which gives you to a CV of 3.77. This is the reproducibility of the spot. So this slide shows the precision of the spotting of the instruments around 3.77, which is more than acceptable in the clinical laboratory space. Generally, we look for precision of less than 10%. So we were able to show that the modifications were able to take a primary tube through to a multi plate and spot out with highly accurate precision. If we move to Slide 18, please. The other aspect that, of course, we needed to show was that using your fully automated system, we had maintained the advantages or the innovations that were the Mayo Clinic had published upon. And so we look at the sensitivity of the assay using limited detection and limited quantitation. Certain protein electrophoresis, as discussed in the previous slide, has a sensitivity of around about 1,000 milligrams per liter to detect for detection and around about 3,000 milligrams per liter for quantitation. With our fully automated system from the fluent through to the MALDI system, the sensitivity of this assay is around about 1 milligram per liter for detection. So a 1000 fold more sensitive than serum protein electrophoresis and between 8 20 milligrams per liter for quantitation. So again, many, many folds more sensitive. The assay is in verification now. How we think about this is moving to Slide 19. Of course, we started with solids and paper and gel electrophoresis. We moved to liquid and so naturally we should evolve to gas. And this is really bringing gas phase electrophoresis to the clinical space. If we move to Slide 20, please. The assays in verification, we have alpha sites who are using the assay over in the United States. The assay will be launched into the CE market with the systems on the mass spectrometer in 2021. And following a recent very successful FDA pre submission, we are anticipating a very smooth ride to FDA approval and we will launch from an into the American market in 2021, 2022. So to summarize and to move to Slide 21. The discussions that we had with Tecan began in 2017 at the American Association of Clinical Chemistry. We had our first prototypes in 2018, so we moved remarkably quickly. The superior engineering enabled primary tube to spotting onto the multi plates. And this really was a step forward because the methods that had been developed at Mayo Clinic relied upon both a pre pre analytical liquid handling system and then a second system to do the spotting with the same accuracy that we can do in a single system. Tecan have been remarkably good collaborative partners. We set some very high challenges with ourselves with spot to spot precision because we know that this precision will improve the precision in the clinical workspace. We had engaged technical and commercial teams focused on delivering our prototypes. And I think that the teams will agree on both sides. These are often challenging. And this is the first in a suite of assays that we'll be bringing to market. The suite of assays are going to move some of the most challenging proteins out of the ELISA and the nepholometry and turbidometric space and into mass spectrometry. To make this truly useful for the clinical space, we need precision, accuracy and reproducibility. And so far with the work that's been done, we've set over achieved all three of those targets. And with that, I'd like to end my presentation. And apologies for the technical issues. All right. Thank you so much, Stephen, for making yourself available. I'm sure this was a very illustrative and very impressive talk. And again, thank you very much. And so yes, thanks again. So welcome back to the 3rd presentation section. So I'm very pleased to welcome Doctor. Wael Jaret on stage. Wael is the designated CTO and Head of Research and Development, and he will talk about innovation and the strength of TCAN in that very dynamic and market environment that I introduced to you this morning. So, Wael, please. So good morning again, and welcome back to our audience online and to everyone here in Menadorf. My name is Wael Yared. I'm the incoming Chief Technology Officer and Head of Global R&D at Tecan. This is my first Capital Markets Day for Tecan and so it's a pleasure to be here. And I thought being a newcomer to the company, I would begin with a personal perspective on what makes this a particularly exciting time in our industry and what makes TCAM very well positioned to capitalize on these industry trends with actual concrete examples. And my main thesis presented here is that we've seen an accelerated and amplifying cycle over the last 30 years and especially accelerated over the last 15 years where basic scientific discovery in molecular biology triggers a demand for technology in detection and sample preparation and analysis which provides an array of solutions to meet the needs of basic scientific research. And those in turn trigger the formulation of new discoveries and it's a self reinforcing cycle. So molecular biology discovery across the entire array of biological analytes from DNA to RNA to protein to cells to tissue have really spurred the development of sample preparation technologies to increase the robustness precision and repeatability and throughput of these assays, the development of detection technologies such as sequencing and mass spectrometry and those have yielded results that again spur further discoveries and even just looking at the lower right hand side, the cover of Nature Methods only last month, again on single cell biology method of the year 5 years ago and now looking at the detection of protein and RNAs in single cells, the unit of life, things which would have been inconceivable 5 years ago and yet are now becoming more and more available in labs today. So I figured I would give you 3 specific examples, 1 in the world of proteins, 1 in the world of genes and one looking at the combination of 2 in diagnostics where we see the cycle of self reinforcing stimulation. So I thought I would start with the world of biologics. Those are drugs that are made out of recombinant DNA. They are expressed out of living cells. And I'm showing here in the upper left hand panel one such drug, a monoclonal antibody. And there is, if you really squint closely, to the left of it, next to that yellow patch, a little speck. That is not a speck of dust. It is actually a small molecule. That's aspirin. And I showed the 2 next to each other just to give you a sense of how big, complicated these three-dimensional structures are. And yet you need to be able to characterize them in full if you really want them to achieve their target, the efficacy and the safety that they're meant to provide. That makes the difference. I mean, and I mean really looking at every single amino acid in that giant chain, looking at its structure, its position, looking at the three-dimensional shape, looking at the post translational modifications, looking at the glycans that attach to that molecule to basically make the difference in the clinical fate of this drug whether it actually cures the disease or it gets metabolized in 3 minutes and loses efficacy or indeed if it harms the patient. So how does one look at something like this? Again, 20 years ago this would have been inconceivable. So demand for protein characterization technology is definitely at the forefront. And you've heard a lot about mass spectrometry this morning. Mass spectrometry is not new. It's been around for 100 years since the early heroic days of atomic physics. And yet, it's only in the 80s 90s that it started being applied to biological analytes and small molecules. And it's really only in the last 15 years that one could apply mass spectrometry to analyzing and characterizing proteins at that level of accuracy. Thanks to the vastly increased resolving power, sensitivity and sophistication of the algorithms for data interpretation. That assumes also that you're able to introduce samples into the mass spectrometer in a way that basically generate efficient ions and in a way that lets the scientists interpret the data that comes out. So thanks to the development especially over the last 15 years, we're now able to analyze these drugs with an exquisite level of detail. The spectrum that you see here on the lower right hand side shows a glycosylation analysis of a monoclonal antibody. It tells you which sugar is attaching to which peptide site in what amount. And that can literally make the difference between life and death. What does that mean? That means we can now have a thriving clinically successful industry, the biologics industry, which is the most dynamic vibrant fast growing segment of the drug development industry. And 2 years ago, this was a $250,000,000,000 industry. Not only is it big because it's clinically successful, but it's also growing enormously fast. And with that growth, we now have the ability to start thinking of much more complicated molecules to go beyond straight up monoclonal antibodies, but look at more complex drug candidates like bispecific antibodies, chimeric constructs that target multiple antigens simultaneously or indeed antibody drug conjugates where you take a cytotoxic payload, link it covalently via a linker to a monoclonal antibody that targets the cancer cells. Those are 4 times more complicated to analyze because you have the antibody, the linker, the cytotoxic payload and the combination of all 3 and all have to be analyzed. And this again triggers another round of technology development and detection performance. So we see the cyclical growth only increasing in intensity. Let me move now from the world of proteins to the world of genes and gene therapy and gene and cell therapy and personalized medicine. Again, in the last 5 to 10 years, increased understanding of the molecular biology of cancer has allowed us to really characterize tumor cells and the antigens that they express and the peptides of these antigens that they show to the outside world and particular to the immune system. And the understanding of T cell immunology now allows us to engineer these T cells so that they can go and target these tumor antigens and antigen peptides. This has triggered again the demand on the technology side for high throughput platforms for the isolation enrichment and cloning of such T cells and has really enabled the development of the whole personalized medicine approach from again scaling up the collection of patient white blood cells, harvesting them, isolating and activating the T cells, enriching, engineering, activating and then using back into patients. And this now allows the development of new paradigms of personalized medicine that again were not conceivable 5 years ago. The last two examples have been therapeutic in nature, proteins and genes. Let's look at diagnostics and a combination of proteins and genes. This is actually looking now again from a discovery standpoint at the improved understanding of the genetics of cancer and the discovery of new biomarkers that are associated with some solid tumor cancers. The bar graph that I'm showing in the upper left comes from a study published only last year by Johns Hopkins. This is the development of an 8 analyte liquid biopsy test, a multi analyte blood test basically, a so called liquid biopsy to detect the at an early stage the presence of 8 different types of cancer. This is performed in combination with a detection of 1900 mutations in the genomes of the cancer patients. One of the issues with liquid biopsies is the sensitivity and this test shows very excellent sensitivity. Another issue with liquid biopsy is that it's very difficult to understand from the liquid biopsy result the organ of origin where the cancer actually originated. And this has triggered again on the technology side the development of machine learning algorithms and more specifically supervised machine learning to correlate the certain the types of protein and genomic signatures with the organ of origin of the cancer. And the bar graph in the upper right shows you now the predictive accuracy of these correlations across 8 different cancer types and it is very, very high. And it's again in that self reinforcing cycle, you can envision now being this being used not just for liquid biopsies, but also on tissue samples, tissue biopsies, multi stained tissue samples where again you can do this kind of multiplex staining, multiplex analysis, predictive analytics in order to improve diagnostics and treatment. So this all having been said, so yes, we're in a very active dynamic fast growing industry. What does it take to actually capitalize on these end markets? What skills do these end markets require? Well, clearly an understanding of the science and user workflows, an active probing in a hard nosed manner of what the underserved needs are, a state of the art skins processes and infrastructure and I will emphasize this again, it has been mentioned before, but we do have we have assembled a unique team here at Tecan over the last 30 years of the company's existence of very skilled engineers, scientists, a big number of our project leaders are PhD level molecular biologists. We're working hand in hand with the scientists and engineers in research and product development. A number of technical skills across robotics, motion control, liquid handling, software and increasingly informatics and bioinformatics and now more and more emphasis on development of targeted reagents for specific end applications. This is all built on a very solid foundation and infrastructure of product development discipline, quality management systems and a regulatory infrastructure that are stellar and quite unique. But this is not enough. I would argue for one more requirement which is the ability as Claus had alluded to before to very quickly adaptively and nimbly respond to demands from these end markets and offer solutions. And in my mind, these really translate to 2 things. 1 is the ability to modularize what you're doing and develop a growing library of modules that you can configure and assemble in order to deploy new solutions and 2, the ability to think innovatively not only about your skill sets, but about your business engagement models. And I'd like to amplify on both of these points with a couple of examples. So modularity, why do it? It's a nice word, but what's the benefit? It changes the way we develop and deploy solutions. Traditionally, when we're developing a large platform, we look at what are the requirements, we go into a concept phase and we design the hardware, we design the software, we integrate the software with the hardware, we develop the assays, we integrate the assays with the platform, etcetera, etcetera. We validate the whole thing and we launch. It's fine. It has been sort of a lengthy, laborious path. We have learned an immense amount through that. It presents certain complexities in development and validation cycles, but we are capitalizing on these learnings over the last 30 years to now develop a more nimble approach of modular platform development where we have libraries of software modules, library of hardware modules that we can configure. Once we understand the requirements to develop a new solution, we can configure the right toolbox, the right libraries and spend more time verifying and validating as we launch our products and products really across the entire gamut of throughput requirements and both internal Tecan products as well as partnered OEM products. So, what does that let you do? It lets you basically deploy solution across all of these end market applications across all types of throughput requirements much more efficiently. Let me offer a couple of examples. One is from the world of software. We've developed and continue to develop a new software architecture called Maplinks. It modularizes the way we think about software and it lets us assemble layer by layer and module by module all the requirements that are necessary for a complex assay, for example, in diagnostics or in detection. So we work from the bottom layer, the instrumentation layer in using hardware abstraction layers that allows us flexibly to support multiple devices and an ever expanding array of devices. The application layer allows us to tailor that application layer to match the functionality that is required. You don't necessarily put everything in it. You put just the right modules that you need and you make it easy to add, replace, substitute modules as the solution evolves. And we've provisioned also at the very top for especially our partners on the outside the ability to provide their own custom scripts so that they can add or modify to the assays without necessarily going back into nuts and bolts coding and that makes it much easier to develop new applications. One thing that this has allowed us to do is to enable custom development both internal and external. And in particular, we focused a fair bit of effort on developing 3 d simulation tools that let us those are full physical models of all of our automation liquid handling platforms that let us visualize exactly what the hardware would be doing once you develop and build it. And likewise, when we work with customers on the outside, they now would have the ability to develop their assays and test their assays before even the hardware is available to them. And you can imagine how faster this becomes, how much faster this becomes in terms of assay development and validation. And yes, we continually build up and expand the functionality of our own internal application layers to target the applications which we think offer a lot of growth. We've put this particular modular architecture Maplinks to work in one of our ongoing projects. That's one of our large projects. It is on behalf of an OEM customer in the space of cancer diagnostics. And yes, it invokes the skills that we mentioned. Modularity is not only at the software level, but at the hardware level. And we've modularized also the components and building blocks of some of our entry level automation solutions. An example shown here is the Magniflex platform. This is based on the CS acquisition that we performed about 3 years ago and we've evolved the product line to now provide us with entry level automation functionality with a base configuration and innovative modules that provide additional performance in application specific directions. And this offers basically the advantage of a flexible configurable starting point for both internal development as well as partner development. And of course, we're doing this in full synchrony with the modular architecture, the Maplinks architecture that I presented before. And then a last point now expanding on the innovative skill set leading to new business engagements, Joy from Ambi Genetics alluded to, introspect. I'd like to tell you a little bit more about introspect and how it works. But basically, again, the concept that Joe articulated very well is that we'd like to connect our automation solutions in a secure manner and analyze the metadata of what these workstations are doing and how they're performing and collecting data and analyzing the data and pointing to potential business improvements out of them. So again, what Introspect allows you to do is to analyze lab, different countries or continents in a way that is customizable based on the users and the user requirements, not only the configuration of custom dashboards to let you look at what you really want to see, but also managing credential user credentials so that you do so in a secure manner and in a way that is also secure from a cybersecurity point of view. So again, the way it works, you have the liquid handling workstations in the lab that have host computers that generate log files. The log files accumulate one time information and other stats information like labware usage and errors and so forth. These log files are parsed and a subset of the log files is selected and uploaded to a cloud based server using secure encrypted mechanisms that is accessible only to the authorized users. And then on the client end using a simple web browser, you can now look at your dashboard, you can customize your dashboard and look at the kind of information you really want to see. For example, looking at one time per day, the example that Joy showed, What are your instruments doing on any given day of the week or time of day? When is the instrument being used? What is the rate of logging errors? What is the consumption of labware and other consumables? And that effectively enables our customers to make more informed decisions about their lab operations. So again, an example of us going beyond our traditional business model and looking at new types of customer engagement and offering solutions that are rich in insight and leading us into new markets. So with that, I hope I've given you a snapshot of why we're well positioned in the markets that we serve. Those are exciting markets and we're and I'm personally very excited to be here. So with that, I'll just wrap up my talk. Thank you. All right. Thank you very much, Rael. And I would like to continue with a topic on behalf of Ulrich Kanter. As I said, Ulrich cannot be here today because he is in California welcoming our newest member to the Tecan family, the company that we just acquired a few days ago. But let me speak about operational efficiency and where we're coming from and why this is, of course, tremendously important in what we're doing. And for me, operational efficiency, of course, is the foundation of a scaled up business and also the growth opportunities of a company like TCAN on a global level. So we, I think, made significant runway in the recent years in improving not just our supply chain, but also areas of the production processes themselves. So just to focus in a bit on the supply chain, we have undergone significant efforts to relocate and identify best in class supplies and consolidate supplies wherever possible. I think we made very good improvements also to globally align procurement activities, which before had been more kind of size specifically organized and self centered and now really are controlled and driven through a central global procurement function. As you are aware and shown on the right hand side of this graph, we made a significant progress in material cost savings, particularly in the space and the time horizon between 2014 2018. And it's fair to say that maybe some of the low hanging fruits are now harvested. We're now shifting a bit more into the mode to deploy what also Wael started to illustrate a more design to cost portfolio that will, of course, then also contribute to increased productivity and profits. But I think we will, of course, continue the overall efforts on material cost saving by then shifting to that portfolio switch from the modular range that I think is very important for our future capabilities of margin expansion. And then on the production side, you also see the graphics here. There have been a very diligent effort to streamline production lines for line flow principles in all our factories. We started here in Switzerland. Now Ulrich is running and rolling it out to the other manufacturing sites globally. And that includes, of course, obvious processes like Kanban module assembly that arrive on the production lines just in time. And I think also on the instrumentation production time, we made tremendous progress to reduce hours that our engineers need to in order to assemble and test the systems before they leave the shop floors. So maybe also just to go back to some of the previous acquisitions and integrations that we've done and illustrate what we've done there. And CEERS was just mentioned by Wael as a foundation of our new going forward portfolio of modular platforms. But as you remember, CEERS was acquired and integrated starting in 2015, and this was really consolidation and cost play for us because we were picking up at a very economic price, a very capable competitor and player in the OEM space. And we, in the meantime, then moved the whole operation here to the Manidov side, emptied out their space and have not only realized synergies in R and D and operations, but also now moved the portfolio from breakeven to profitable contribution to our overall top and bottom line. And of course, one of the other attractions then in addition to the portfolio that we wanted to acquire was that Sears brought us very, very interesting and profitable clients, particularly in China and North America in market segments and applications that Tecan was just starting to explore with the Tecan partnering business tikken just announced the acquisition of a long term supplier of key parts. So we have acquired a company at the end of May that is virtually an integration of a core supplier where we are the major stakeholder and major customer of this manufacturing side, which is divided up into one side in California, in Morgan Hill, and then also a very capable facility in Vietnam, which, of course, we also look at as an opportunity to future build out our footprint in a lower cost region. But for the time being, we are, of course, internalizing and benefiting from the cost benefits and, of course, aim to also enhance future our overall operational profitability with this vertical integration. Today, we talked a lot about the transition from research into the clinical diagnostic market. And I mentioned to you before that, of course, Tecan is probably most renowned for technology around laboratory automation and all the technical aspects of that market. But I would probably argue that a lot of the value proposition and why customers actually come to us and choose Tecan as a supplier is also based on a very solid foundation of regulatory and quality compliance. And I just bring up this slide to mention, of course, the successful history of Tecan developing processes and compliance tools that allow us in the space between 2014 to go through 6 FDA inspections at our main manufacturing sites with 0 observations. And this is, in my recollection, a pretty impressive performance in terms of compliance and the track record of going through such FDA inspections. And then in addition, we also completed the MD sub certifications for our production sites in Hamburg and here in Menador, and we will continue that program now into other sites as we speak. Why is that really critical? It's, of course, for us, reassuring manifestation to have the FDA really subscribe that we are fully compliant and are very happy with our process and our performance. But as I said before, for us, we, of course, use it very proactively in approaching customers, also working particularly in the partnering side with clients that probably have less proficiency in these type of regulations and processes and consult with them on their best development and submission processes around 510 and PMA applications. We, of course, are using that to transition also clients from research into diagnostics, so not just on the being registered in North America as a Class I medical device. So very, very important backbone and very important activity throughout the company. And it's probably also fair to say that with more than 80 professionals in that division and overall entity, we are very well equipped to also incorporate future acquisitions and apply to them the same rigidity and process control that we have done to the other side of TCAN. Now in the next section, I just wanted to give you an update on where we stand with the partnering division. And we heard a lot about the research and some of the translational efforts that we have successfully undertaken between the research entity and the OEM side, but maybe just specifically on the partnering business. And again, for me, that is a very critical element of the existence and the value of Tecan, being able to work with leading IVD companies or aspiring IVD companies to produce sample to answer machines that address the most desired and needed gaps in today's clinical diagnostic settings. And this speaks to the business model that we entertain in the partnering group. So we basically have 3 different models of engagement. What we commercialize under the TEC and Carver brand are components and sub modules that our clients use for their own development programs. We then move on to supply and use some of these modules in our own development processes. And as Claus illustrated in various examples, using existing TECAM platforms or modifications thereof to convert a customer solution from a research environment into the clinical space with the shortest amount of time possible, leveraging application and regulatory know how and backbone of these platforms. And then lastly, we are, of course, also engaging and you know some of the examples already with accounts and clients like Ortho Clinic and Endako, where we really develop systems from scratch to bespoke solutions that are fully optimized on cost performance and other factors that our clients desire. So in the cover part of the business, which is a very solidly growing part of our franchise, We are supplying pumps, valves and enabling modules to the workflows that we're interested in. We are offering, of course, every component that is quality assured and application tested before it is launched. And we offer quite a bit of flexibility and also the compliance schemes around the documentation effort and testing efforts that are required to use our modules and subsystems in the regulated environments. In addition, we have a very capable technical support team that remotely and on-site facilitates the successful integration of these sub building blocks into the solutions that our customers are developing. So we are, of course, very proud, and we have a very broad track record. And this is probably the space where in the parking side, we're working with literally hundreds of clients on various levels of integration, some of which by a few products, some of them by thousands of them. And this has also been the area where in the last years, we've very successfully expanded our business into Asia and particularly into China, where we're now working increasingly also with Chinese domestic companies that use our components at modules for their own development efforts and programs. And now I'm very, very happy and proud also to announce the kind of rebranding and probably for the first time branding of what I mentioned before, the system development part of the Powering Business franchise. So before we said we were converting platforms or we're developing these bulk systems, so we thought we give it a bit more of a catchy and illustrative name. And so we decided on Synergense, which really kind of means to bring together the synergistic partnership and the excellence in applications and compliance and workflows that we bring to these type of joint efforts. So we have a core offering where we go out and design and concept with our clients their desired instrumentation. We bring a lot of innovative principles and IP into these discussions. Of course, we're also able to incorporate IP and capabilities that our partners bring into this discussion. Then we, of course, offer in the industrialization phase a very capable team and support to shorten the clinical evaluation time as much as possible. And then later, when we move into the manufacturing space, we are, of course, an accredited and very capable and scalable player to upscale production for our partners, literally from a few beta test units that we typically develop in the R and D phase to hundreds of units in full commercialization range. We also started to expand the offerings in the Parting business space. So in addition to design, industrialize and manufacture the systems, we're also now adding enhanced life cycle management products where on behalf of our clients, we take more and more control over the 3rd line defense or 3rd line technical support. We added also total service packages. So for the first time starting 3 years ago, we started to offer field installation and repair services for partners on behalf of our partners, and we could very credibly do so because we have a very large infrastructure of service engineers that are clinically trained on the Life Sciences side of the business. So globally, we have an exceptional capable infrastructure of service people that can be deployed in the parking world for those clients that desire maybe an upscale or an accelerated growth path in the regions where they have not yet been able to invest in service personnel. And the other part of the venture that we're just starting with one high volume client is an instrument refurbishment program that allows our client to, after the period of reagent rentals, then reuse these instruments in lower, I would say, throughput environments in a very economic fashion. So looking at the overall pipeline and the kind of progress that we are making, particularly on the system development side, it's fair to say that today, we look at the richest and largest pipeline in the development programs with more than 25 projects under discussion in the concept phase. This is typically where we engage with our concepting and R and D groups and application scientists to discuss feasibility concepts and decide if or if not the partnership is a match for both ventures. We have, I think, most engagements right now, and there's probably not a surprise given the themes today in the molecular diagnostic space. So that is probably our most expensive area right now, but there are quite significant others also in immunodiagnostic and other spaces. We have, like I said before, for the components side, also in the system development side, we have made very good inroads into Asia and particularly in China. And Claus already mentioned one of the accounts that we work with very successfully, which is Sansho Biotech, one of the leading infectious disease molecular diagnostic companies, but there's quite a few more in that concept and discussion pipeline as well. So then moving into this category that is highlighted under development, this is the category where we quantify it as more than 5 programs where we actively work on a development program, and we have signed a development contract with these clients. This again is a variation of projects that are ranging from simple platform freeze projects to, I would say, substantial larger development projects like the one that Wael just mentioned in the space of cancer diagnostics. So I think in my view, a pretty good variety of smaller, faster to market projects that in our nomenclature may contribute maybe single digit millions as at the peak time and then a subset of these projects with the potential of delivering double digit million at the peak growth in this type of category. And then, of course, you see in the instrument ramping up and the regular supply phase, when I look back a couple of years ago, this number was probably 5 or 6. Now we're talking about 35 existing supplier relationships, again, with a very good distribution of mature businesses and businesses and interactions and collaborations still in the starting up phase. And I would still classify relationships and market opportunities around transfusion medicine with Ortho Clinical in the growth phase as well as the Darko Omni Systems for Agilent. But there's also various others mentioned here like SingleX and Mobidiag and Inova, which are kind of more platform modifications, but are also still seeing quite significant growth opportunities. So with this, I probably wanted to shift gears a little bit. And I think we've talked a lot today about technology and impact and what TCAM is doing in the market space in research and in the translation into clinical diagnostics. But I also wanted to talk about maybe the culture and the ambition and the drive that you would see in Teekay and one of the reasons why I stand here in front of you being very excited about the opportunity to head up this exciting business and exciting teams, not just in the management team, but around the world with these 1800 colleagues that are absolutely subscribing to that understanding and the purpose that we as a company are in a unique position to help to better understand, to better diagnose and to better treat patients. And I come from cancer research. I worked for a few years in that market, and I take tremendous pride in this notion, which for me is not kind of a marketing statement. But as you heard from my colleagues, but also more importantly from Joy and from Steven, it is happening right now, and we have a tremendous opportunity in front of us to capture and participate in this exciting journey. I showed you this slide and my colleagues showed you this slide over and over again. And again, this is, of course, what we also internally use to explain to our employees the purpose of the company and why we get out of the bed in the morning, why we work extra hours and why we really work very hard to connect very closely to our clients and customers to understand how we can improve, how we can further develop capabilities, our attention, our scientific excellence, but also our products and tools going forward. And I think you've seen a lot of examples of this today. Another area, of course, that is very close to us and also to me very personally is our responsibility from a social and economic environment. And we are very proud when we look at the chart of the UN Sustainable Development Goals that we are very prominently supporting the SDG 3, which speaks about the health and the well-being of the population on a global scale. And I believe Tecan has a very credible play in this venture and this charter of the United Nations. And then lastly, what I want to talk about is culture. And we started as a company, and you've probably seen a little bit, some of those that have been in this facility before may have noticed the difference. Anyone that has been here before that kind of walk into this and say, oh, this looks a little bit different? All right. But believe me, this is not a paint job. Here it is maybe a paint job. But what I think we do in the company is also to very clearly communicate our expectations, my expectations, my colleagues' expectations around the value and the communication and the behaviors that we want to see and drive within this company in order to be a leading company in that space. And you see on the wall this notion, every lab, every day empowered. And this is our statement that we give to the outside world. So we are truly fueling the empowerment of academic clients, of pharmaceutical clients and of diagnostic clients in that venture. And we created what you see behind me, what we call the TCAM Brand House. So the TCAM Brand House is just an illustration and characterization of the core values and the differentiators, our positioning, our customer promise, which is always there for you, and the external impression in Power with Tecan, built on a very solid foundation of expectations and values around trust, high standards and ambition. And this is, if you would be cynical saying, okay, this is a very nice slide, so what do you do about it? So what we do, we go out and we talk to everyone in this company about expectations on communication, on behavior, that we want to see people being courageous, curious. We want them being respectful. But lastly, and very importantly, I think we want them to be very and brutally honest. So I think in that context, we are driving, and I hope we're driving, towards a very productive and engaging company culture. And I think I stand here and say we've come a long way in this. And of course, for me, that is a very integral part in addition to all the technologies and technicalities that we discussed, allowing us to really play in the forefront of this market. And this brings me to the financial outlook. And you heard a lot about the market environment and the market conditions. I described to you particularly the kind of size and the underlying CAGRs of our market segments that we're serving with Life Sciences and Laboratory and Clinical Diagnostics. And again, I just wanted to reiterate our ambition and our, I think, very credible path to organically outgrow the market average and, of course, then adding selectively M and A with that market development and the capabilities that we look at today. And I think some of the drivers that have been explained and described to you, I hope, resonated in terms of our focus on key growth applications that give us that additional fuel and boost in areas like advanced genomics, cell biology and proteomics and mass spectrometry. We are, of course, expanding our solutions with dedicated systems, but even more and equally important, the consumables and reagent space. We are putting an increased focus on service and aftersales. And those who have not met our new colleague, Peter Pops, she's now heading the efforts to professionalize everything that we have already done really well in service and after sales and bring that to the next level of productivity and profitability. We continue to expand regionally. I mean, China, as I mentioned before, we are already 110 employees today, but we see China again is just at the starting point of really moving ahead in terms of life sciences research and the health care and clinical diagnostic systems that they are installing in their hospital scene, but also in their universities and clinical research laboratories. And of course, we will look and we as you are aware, we have a very healthy balance sheet. We continue to drive the M and A pipeline very focused and with as much speed as possible through Eric Nordstrom and his team and of course, the whole engagement of the management team. And in addition, we, of course, improved our bottom line and the profitability. And this, of course, as you know, TECAN being pretty, I would say, efficient on the CapEx deployment, pretty much is driven by top line growth or this is probably our largest lever to date that we have. And of course, the ambition and the plans that you've seen outlined by myself and Claus, in particular, to grow the recurring revenues, which are now at 42%. I think we have good line of sight that they can improve and grow further as a contribution to both top line and profitability. And of course, as you've seen from Wael, we continue to improve our efficiency in R and D, getting faster, getting even more reliable in this development process, delivering systems on a modular range of products rather than looking at monolithic development programs. And lastly, of course, focusing on increased operational efficiency. I mentioned before that we continue our efforts on material cost savings, And particularly with now the first or integration of a key supplier, I think we see, of course, great opportunities to now leverage that supplier in the optimization of material costs and other aspects of that piece. So lastly, confirming the financial outlook. So you've seen this communication before. We are confirming the guidance on mid single digit to high single digit growth in local currencies for 2019. And of course, this is now backed by the recent acquisition of the supplier that I just mentioned that adds sales in the lowtomidsingledigit1000000 Swiss francs amount in 2019. And again, additional acquisitions are not taken into account in this guidance. On the EBITTR side, we are guiding at an EBITTR margin improvement to around 19%, and this, of course, includes the integration costs and shorter term lower margins that we already communicated at the point of acquisition of Nugen Technologies in the range of high single digit CHF 1,000,000 amount in 2019. And this, of course, is offset to a large extent by the IFRS 16 that has been, of course, a recurring contribution now to the profitability, but will be applied for the first time for the full year of 2019. And with this, in aggregate, we are confirming that guidance of an EBITTR margin at around 19%. So with this, I thank you very much for your attention. I know it's been probably a bit of a speed dating experience for you. But I'm sure you've learned something. And I hope that also this afternoon, most of you are available for live demonstrations and the hands on experiences that we prepared for you. For those that are not able to stay on until this afternoon, I thank you very much for attending. I, of course, would like to thank everyone that looked at us and in this webcast remotely for their time and attendance. And with this, I'm very happy to move to the Q and A session. And please fire away any questions that you may have, and myself and my colleagues will be here to answer as good as possible. Maja? I have two questions. I would like to start with a potential margin expansion. It's great that you give us the drivers of further EBITDA profitability improvement. But is there a range you could tack to add to this? If nothing changes, no acquisitions, would it be a 50 to 100 bps? Are long term margins potentially above 20% 20% to 23%. It just feels that while on the sales side, availability is quite good on margin progression medium term, there is a big question mark. The second question is regarding acquisitions. Can you help us think about the way you're going to spend your money? Shall we see smaller acquisitions, integrating suppliers, driving margins up, are you still looking for a meaningful larger acquisition which could add additional business to your company? Or are you actually at what some at what point in time are you considering returning cash to shareholders? Thank you. Right. Thank you very much for the questions. And on the margin side, I'm afraid I'm not really aiming at giving you more granularity on what we're targeting right now. And I think we're very, I would say, comfortable and confident around the kind of 19% EBITDA margin perspective that we're giving you. And of course, there is still underlying pieces that we're managing right now, including the Neogen acquisition and the expenses for the integration costs. But I think for me, the 19% is the best guidance and maybe granularity that we can give you at this moment in time. I don't know if there's any other details that you would like to discuss. But I think right now, based on the progress that we're making, we feel pretty good about the 19 percent. And on the M and A side, I mean, of course, that is probably the most active discussion right now. And standing here to say that when I came in on April 1, the good news is that, of course, the M and A pipeline was part of the development process, which was a very broad engagement of the management board driving that M and A pipeline. So we're not resetting anything. We're not kind of saying, oh, we have to restart this whole process. We still look at a very healthy M and A pipeline, both from smaller bolt on acquisitions. But to your question, of course, we are able to deploy several 100 of 1,000,000 against a more sizable and maybe a bit more transformational target. And we have also assets in that list of targets today, and we are in very engaging discussions. In this case, as you may appreciate, most of these targets are in the ownership of private equities. So sometimes timing of them is a little bit out of our control, but we have a very good view on what we would want. And this is, of course, based on the kind of three areas or kind of evaluation classes that we're looking through. 1 is the strategic fit of a company to all these things that we outlined to you today. 2nd, of course, are the financial parameters. And thirdly, and this is an area we recently have walked away from opportunities, where we are looking very diligently in the regulatory and process compliance of the assets that we're interested in. And if we can't get comfortable with that regulatory or compliance framework, even with, I would say, nominally positive financial outlook, we would walk away from such an asset because I think we would not be willing or I would not be willing to invest the time and money and also the risk of an FDA warning letter to bring such an asset into the TECAN framework. But I'm just confirming that we have a very solid and very good pipeline, and I can assure you that Eric and the whole management team is very engaged in driving forward this M and A pipeline. And to your point of alternative means to return profits to our shareholders, of course, as you can imagine, this is a very ongoing and regular engagement with our Board of Directors to exactly evaluate when is that point where we have to think about the terms of models. And of course, we are talking to as many investors as we can. And I'm just back from the kind of last roadshow at Interlaken. Of course, we also have these dialogues around are we sure enough that we can profitably invest in M and A, which in my nomenclature would still be my absolute preferred way of leveraging these profits. And then if at one point, we would probably even generate and accumulate more cash, then this discussion becomes more active. Thank you. It's Chris Gretel, Credit Suisse. I have two questions. The first with respect to the change in management. Could you elaborate now what your priorities are in any way different from David's previously? And what you expect to make different in this company? So that will be my first question. So yes, of course, there's probably questions that I get every time that I move into kind of meeting with investors and analysts. What's new? What are you going to changing the company upside down? What's to expect? I mean, the good and the bad news is I'm with the company now 5.5 years, and I'm probably plead guilty for a lot of the advancements and progress and things that we've done over this period of time. And of course, the way we manage and run the company is a very integrated management board decision and discussion entity and forum. But I mean, when I remember back when I joined the company 2013, the company was in an entirely different state. I mean, this was more we went in to really bring 3 major projects to market where if we would have not done this in terms of improving the processes, the kind of marketability and the success of these projects, we probably wouldn't have this discussion today about M and A and expansion and where do you invest your profits. Now over the last 5 years, like I tried to illustrate, I think we've made tremendous improvements, structural improvements to stabilize and improve and really upscale operations, R and D processes, sales, commercial processes. So I'm coming in now on April 1 this year with an entirely different, I would say, opportunity, which is less inward artistically looking at fixing the assets of the company and then commercializing the process of the outside world. My focus is now innovation, M and A and of course, expanding the business and accelerating the growth along the market opportunities that we try to outline today. So my conviction and my view is that if we really understand the market environments like the genomic, the proteomic and the cell and tissue analysis workflows to the best extent. We have an excellent amplification machine with Entycan, both from an operational and also commercial standpoint to now really drive growth forward. And that's my ambition. And that's, I think, what you probably heard a little bit in the kind of the presentations today. We didn't talk too much about the products, but we really tried to illustrate how we see our capabilities as a solution provider fit into that space of academic clinical research, pharmaceutical research and production and the diagnostics environment. And for me, it's probably a more application centric holistic discussion than necessarily always holding back into products like Fluid and others, which are, of course, great, capable enablers, but they are not the center of our thinking around this kind of expansion of the solution space. Okay. That's actually very interesting because my second question related to the Fluent platform. So I was just wondering, I mean, it's now, I think, now 5 year on the market. How do you think about actually the life cycle of that product? If I remember right, the EVO Freedom EVO was about 10 years on the market also. And now is this basically the cycle accelerating? And you're basically, I think, already with the GX around about the last innings now of the opportunities that you can address. I mean, is there kind of a shorter cycle? And would you expect kind of some new innovation coming up? Great question. And I would probably like to take you back to some of the comments that Wael made in terms of our increased efforts and successes to driving modularization of our portfolio. So the way I think about Fluent is more, I would say, of very capable modules that are assembled to happen to be Fluent. I think what we've done is probably less visible to the outside world is that in the meantime, we have put a lot of work and effort in to modularize the hardware and the underlying the software and the underlying hardware in a way that even if there would be new workflow requirements coming in the next years, we without touching a monolithic development architecture, we are able to add different modules, different capabilities, different softwares to a similar frame or other frames. So there I mean, it's probably fair to say that this kind of innovation cycle will continue, but it does not require us in such an extent to really push the stop button on one platform like the EVO or from a development standpoint and then enter into a kind of whole new way of kind of creating the next big monolithic infrastructure. So I think you will see a cadence of solutions coming to market going forward that may or may not look like Fluent, but leverage a lot of the hardware and software capabilities and the modularity of that platform in other ways and forms and product names. I hope that answered your question. You have impressed us by the speed and complexity of the world you are in, and it's accelerating in this respect. Can we assume that or is it a wrong assumption that the R and D expenditure, especially the D in percentage of sales, is increasing? Actually, I don't think that is necessarily the conclusion. Again, I would probably rewind back to some of the elements that we try to illustrate here right now in terms of the approach that we're taking to modularize and become more efficient and nimble in the R and D processes. So I'm convinced that we can do a lot more in terms of our capabilities and the engineering framework in terms of speed, efficiency and leveraging the modular portfolio with what we have today. And then it just become more productive from an R and D efficiency standpoint. I think there are, of course, opportunities where we're looking at. If we identify a major market opportunity, we may decide on a business case to invest in that opportunity ahead of time. But that is, I think, an ongoing process that we do in our business strategy planning cycles every year. So I probably wouldn't expect a big modulation on the R and D spend. I think we've come a long way in trimming down the spend, not so much from a capability standpoint, but far more from an efficiency standpoint. I think we have a very good system set up now, and I'm very, I would say, positive that under the L guidance, we will both continue that efficiency build out. And then if the time comes, we will have a discussion on additional and incremental innovation programs, but nothing exceptionally to be expected in this time frame. Holger Blum, PatentEx Management. You elaborated on the exciting parts of your business where you have high growth in cell and gene therapies. But I'm sure there's also the dark side of the business where you have more challenges and price pressure. So I wonder overall, looking at the total industry, do you see the growth rate rather accelerating because the mix now is different? Or is it should we think about the next 3, 4 years about comparable growth rates to the last 3 to 4 years? Or do you see an acceleration in trend? That's part 1. And then maybe part 2 on your relative position to competition, what sets you more apart versus peers compared to 3, 4 years ago? And whether you'd use it more for enhancing profitability or just mainly focusing on the top line? No, great questions. And to answer your first question, and of course, it's not all booster rockets on our shoulders. And I think we tried to outline the business opportunities. And I think our attempt and I think a successful venture to identify those sub segments that predominantly benefit from capabilities like the ones that he can offer. And these are in the space of laboratory automation, upscaling processes and really translating technologies from research into the regulated space. So I mean, yes, the growth rates underlying, I mean, like I said before, we continue to aim to outgrow the underlying market segments. Acceleration, deceleration, of course, in many factors depend also sometimes on the adoption of some of these technologies in the markets that we discussed. I mean, we talked about the translation from advanced sequencing technologies into the clinical space. You've seen very elegantly the description on where companies like AmbreGenetics are in the adventure. But of course, there's always, I think, some time that it needs for these technologies to be adopted by users in the broadest sense and less from specialist companies and really kind of go out and be deployed in average clinical settings to the kind of lower complexity levels. So I wouldn't kind of necessarily construct a kind of this is now an accelerated growth path. I think we very ambitiously and passionately will aim to outgrow the market. But I mean wherever the opportunities is, of course, we will put every muscle behind it to be as fast and as aggressive to grow our share or the new market that we're entering with the products of choice and that we are developing either for us or for our partners. And maybe on your competitive differentiation question, of course, we are in a highly competitive market. I mean, we are not the only company offering leverage to automation. But I believe what makes us somewhat special is really that ability to upscale, industrialize and transfer technologies from research into diagnostics. And this is not just appealing for the diagnostic companies. This is equally appealing to researchers in the lab and people that are aiming to develop technologies that may go into this transition because they know with TEC and they work with solutions that are, if you want, like predefined for that regulatory journey because we build most, if not all, our products alongside the FDA regulation. So this is, I think, where we're particularly strong. This is where if you would work with us on the research side, you want to move into diagnostics, you don't have to switch platforms. You don't have to do all these things. And I think at the same time, of course, we are probably very well equipped to respond to very flexible market demand and requirements. So we are not only an automation company. We're adding capable consumables and software that makes our solution offering more complete. I think that's, I think, a very important piece. And like I said before, we are investing into also differentiating tools like introspect, which really help our clients to not just have a great piece of equipment and consumers and reagents, but really assess their productivity and operational efficiency with software tools like introspect and other things going forward. Again, I'm not claiming we are the only play in town, but I believe we have a pretty solid understanding of the science as it relates to the opportunities that we see from research into the pharmaceutical setting into the clinical setting. Yes. Thanks very much. Scott Barlow from Berenberg. And if it's okay, I'd like to direct a few questions to some of the other speakers, Akim, if that's all right. Sure. I was going to ask Claus. It appears to me that Tecan has always had good products in detection, but punched a little bit below your weight. You've talked about Spark exceeding your expectations. Are there any organizational changes required to really make that a success or at least live up to its potential? So perhaps if you could talk a little bit about that. And maybe then, Hakim, if I was to ask you to force rank some of the areas that you feel a little bit underrepresented on the consumable side, Is it more cell biology? Is it more proteomics? Or is it more or Maspexo? Or is it more molecular? If you can give us a feeling for where you see Tecan as underrepresented today, that would be helpful. Karsten? Yes. Let me comment on Spark and SparkSaito. I thought you probably got a sense of that now with Spark's site coming, there is, I think, a big excitement in the organization, right, because it's a product I think we've been waiting for a long time. And the way we have designed it, the way from the features it comes, we are, I think, very confident to hit a kind of very sweet spot out there. And SparkSaito is going to build on the success that we have seen with Spark, right? Spark came in the market about 3, 4 years ago as a modular platform, and we used the time to improve functionality, to add new functions, to develop ready to use asset and to make it easier for our customers to use the overall product. And with the introduction of SparkSight, we started to look into the organization at the end to address your question around what is there an organizational requirement now to deliver and on the growth expectations. It's something we looked into. I think specifically around SPARC Cyto, we want to take care now that we have the application know how out there, right? We need application scientists because the instrument is now more than kind of just looking at simple immunoassay. It's really about talking the complexity of a cell based assay. So that's an organizational kind of change that we're going after that I think will help us to improve the overall success. And it's in line at the end with the focus that we're calling out, the application focus. It's we want to if you want a goal that we have set out that if you look at our ratio of what we have between reps and application scientists, to bring that down to something that is in the range of 1% to 3%. So we really want to be at the level where we can support those applications, okay? And then to your second question on I think my personal ranking is probably to be expected. I mean, probably from the genomic space, I think we see still quite some opportunities there to become more complete in some of the kind of workflow offerings along the axis of extraction all the way into the sequencing modalities and other assets as well. 2nd would be proteomics. I mean, that is for sure. I mean, there's I mean, as we highlight today, I mean, the workflow as it's realized today for many of the mass spec applications really cries out for functional consumers like the one that we just included with tacon SP. But there's many more of these functional elements that really help to, I would say, stabilize and make these kind of workflows more, I would say, repeatable and transferable to routine use. And then, I mean, on the sell side, I mean, naturally, there I mean, we actually launched a new range of microplates that we're adding to the Spark reader that really is probably one of the key elements of cell adhesion and cell analysis. But probably the cell market itself doesn't offer so many, I would say, profitable reagent opportunities and consumer opportunities. Perhaps last quick question for me, if possible. So we heard today how Introspect was helpful for some of your customers with multiple systems and requiring efficiencies and monitoring. But I just want to get a bit more of a broader feel for this move into software. Is this just a platform to appease your existing customers? Or is this a self sustaining business model or potentially even a third leg to your business? How far does this move go? So right now, introspect is what it is. It is a a first step into a sales as a service modality that Tecan is just starting to, I would say, engage in and explore. And I don't want to get ahead of myself and proclaiming this will become a massive business entity. I think it is a very important capability that we want to build out in terms of lab connectivity in the greatest sense. And introspect is probably one of the, I would say, product manifestations in their journey. But I mean, introspect today, I think as was outlined by Vael Cloughes and Enjoy, I think it's for us an Element tool that is in the beginning phase to be also growing into other areas. I mean, it is right now offering a lot of functionality. We see a lot more that we can do with it. And yes, I think as we grow this product in the market space, also we have to grow our capabilities as a company to sell and support and then basically monetize these type of products going forward on a probably more extended range. But I would probably classify it as a very important first step into the area of software prioritization and digital product development. You have talked about many of the acquisitions you did in the past few years. Can you maybe also elaborate a bit on IBL? How has this developed? And for example, also how many new product have you launched? How is this developing? And how does it fit into the Tecan strategy? And then the second question would be around the MOSPAC sample prep. Can you maybe give a bit more color on who are the competitors there? And how do they compare to Tecan? Thanks. Sure. And then maybe I'll take the first question and then Claus you can probably talk about the kind of mass spec environment. So IBL, as you know, was required to add capabilities and content in specific diagnostic regions where we felt we can leverage, particularly the presence of the TECAM open systems that cater to areas like autoimmunity or allergy testing or intolerance testing on a bigger scale and other more niche immunoassay markers. And as we also communicated, IBL business was integrated into the company with the aim to leverage the global footprint. I think we made very good progress with expanding our reach, particularly into other areas of Europe because IVF was predominantly kind of Germanic or DACH based franchise. And we also, I think, made very good inroads into the Asia and the China market. And we're now moving into the North American market with more focus. And to your question on new product launches, I mean, we are adding products as we basically develop the pipeline for these niche targets, particularly in collaborations with those entities that develop and identify biomarkers. So we are constantly maybe a few year adding content to these platforms. But we also launched, as you probably have seen from our previous communication, an entry level system that is also capable of now penetrating more, I would say, lower throughput laboratories with a similar portfolio. And we have completed the transfer of these assays onto these new box, and we are very actively promoting it right now. Claus, do you want to take the mass spec question? Yes. This was around the competition in our mass spec and TTK NSP environment, right? So I think very good question. It's with the products that we have, with the verticals that we address, we try to pick those areas where with the product features that we have, we have a unique differentiator. Competing with, it's more around applications where customers decide that, oh, we don't need now solid phase extraction. We're doing it without, for example, dilute and shoot, which is a common approach without purification to put something directly on a mass spec. So it's more about getting customers to adopt certain assays that could really require the level of overall purification. If you look generally around who has also SPE products out there, you quickly end up with the large mass spec consumables provider. But we find that we are not really in at the head to head competition with them because our product, so the t:can SP, consumers in solid face extraction columns, have very differentiated kind of technical properties, right? Those are microsorbents. The bed of the absorption is very, very small. It gives you if you're looking at the large volume that you need to get to solvent bed, that's the kind of technology that you use and that other suppliers haven't been able to really master it. But the way I like to look at it from a competition point of view is really what kind of solution are we able to deliver. And when it's about to have automated liquid handling system, VISTA positive pressure system and adding on the solid phase extraction, we have a quite unique position, which helps us. I would have 2 more questions. The first is quite easy. Are you actually recruiting, looking for Head of the partnering business at the moment? Yes, we are. So you hope to replace yourself? My aim is to fill that position by the end of this year, latest early Q1 2020, yes. And the second question relates to the partnering business actually. What is your view on the risk appetite, TCAN should take? I think under David, we probably deemphasized the dedicated system kind of area a bit kind of after the experience with AutoVision, etcetera. So is there any change with respect? And would you have some appetite for larger contracts again? I mentioned before that maybe I was not clear enough. In the section of contracts or projects under development, there is a substantially large project in that category. But maybe to address your question slightly different. I said before, we take on bespoke system development programs and we're not shying away from them. I think we have the experience and the credibility that we build up and the experiences that we made particularly on these previous instrument development programs. But I think what we see as a preference right now is really accelerated time to market projects, where most of our clients we talk to prefer faster route leveraging modules of our existing toolbox in any form or fashion to deliver alpha, beta and verification validation units in a shorter period of time. And so it's less us kind of shying away from large projects. It's more we see the growth and the time to market opportunities more on the modular platform development range right now, and that's what we're reacting to. And then of course, when the opportunity would come along, and you can imagine that we're not kind of sitting here and waiting for customers to call us. So we're very proactively identifying clients where a next generation system that could even probably more kind of need a bit more of a bespoke development approach would be due, and we are very actively cultivating and then working on similar programs as well. But I would very happily take on the next bespoke system development program. Okay. And now since you mentioned it once again, this larger project, I mean, is there any time line to it? Definitely not in 2020 in the market. Beyond that. Yes. Thank you. I think you mentioned before this lab works offering. Maybe you could explain a little bit more what this means and what are your expectations also from our future revenue contribution? And maybe just on the consumables and reagents, I mean, is it mandatory that customers use your products, so the plastic tips or the reagents? Or could they also be exchanged with, let's say, other supplier? Should I pick it? Yes. Yes. So on your question around lab works, right, it's LabRx has been with Tecan, if you want, since Tecan exists, right? The need for customizing certain systems in a research setting, Tecan has always done that. And the team helped the sales out there to design those systems at the end, get it installed and support it. What we now did by really now giving it a brand around it, we're calling it now LabWorks as a capability, is as we have seen over the last years, the contribution of those projects has grown. And to make sure that we are able to capture future growth potential, it was just important to organize it as a really dedicated group, but also to make sure that in our communication, we are very clear what is the capability that people get out of overall LabWorks, right? So at the end, it's nothing that we're doing now newly. I think we are refocusing it and creating visibility around this capability and very actively go out there and look for projects where we know we can win through this overall capability. And I think your second question around consumables, when I talked around genomics, I think I made the comment that consumables at Tecan work that you have the instrument and you have the consumable. And if you want to achieve the performance that we guarantee with the system, be it in pipetting accuracy being reproducibility of the results, you have to use the consumers that come with the system. It's and if only if those 2 are combined, then we can take also responsibility for the overall performance of the system. If our customers want to use the system with other consumables, there are certain types out there that also fit on the overall instruments. It's nothing we recommend, right? And it's nothing that we are going to support. But maybe an add on comment. So what Claus was describing is the life sciences environment, where typically you talk about open systems. They are not kind of closed, kind of locked in solutions. And some of the of course, on the reagents, we work alongside many reagent vendors, including our own, for example, for labral prep in some instances, to just facilitate a variety of biologies that require different chemistries. So it's an inherent nature of these open systems that you can sometimes pick and choose what the best chemistry is. And that's why I think we tried to outline why we're so excited about the NuGen acquisition because it truly brought some innovation and differentiation in their chemistries that makes, of course, us very, very confident that we can not only gain share of these reagents on our own machines, but also increasingly sell these chemistries into competing platforms, which would probably then have the same situation. Then secondly, on the consumer side, on the partnering side is, of course, a little bit different because, once a consumable is designed into a clinically validated workflow, it becomes incredibly difficult, if not costly, to move away from such a designed and consumer. But similar to what Claus said, I mean, in these type of processes in the clinical setting, you're more worried about performance, reliability and uptime than necessary squeezing the last fraction of a cent out of a plastic consumer. So I think the cost of failure overrun in these type of environments, and this is why we concentrate on producing and delivering high quality consumables, is probably playing to our strengths rather than exposing us to competitive threats as I just described. Thank you. Just one real quick. I just want to get a better feeling for the shape of gross margins going forward. So I think that historically as a group, the messaging was somewhat that gross margins would be under modest pressure because your partnering business is growing faster and that has lower gross margin. But now there's been some organizational changes. You've had some cost savings. You bought NewGen. So I don't know if you're perhaps pulling in Rudy, but I want to get a feeling for how you see the evolution of gross margin given the current business mix. I mean, of course, gross margin pretty much depends on the mix of the products that we're selling. And I mean, at the end of the day, the more reagents we're bringing into the mix, overall, we're benefiting our profitability. But what you said before is true. Of course, the 2 businesses operate on very different gross profit margins due to the business nature of what they're entertaining. And as you alluded, the more partnering business, particularly engineering work we are taking on, which should be an indication of future growth, the more kind of we are kind of compromising on the gross profit, particularly on the partnering side. But again, I think we have a pretty good balance there. And we do, of course, everything to also expand our inclusion of consumables in the partnering side as we do, of course, now with the reagents and consumables on the Life Sciences side to capture as much of the recurring revenue, which at the end of the day helps profitability. And the last piece, of course, as you've seen with the integration of our supplier in North America and Vietnam, that's, of course, another kind of means to go at the kind of material costs and the savings that you can leverage from such a kind of operational and vertical integration. Again, probably I wouldn't like to guide on the kind of gross profit trajectory. I mean, as you know, our business model is quite complex. That's why I would also refer back to I mean, we feel pretty comfortable guiding on the top line and the bottom line. And like I illustrated before, I think with all the dynamics in between the guidance, with all the kind of ins and outs, which is, again, just to be very clear, unkind of adjusted numbers overall. I mean, we are just reporting everything that comes through also from an kind of acquisition standpoint. So these are the real numbers, and that's why I think I feel pretty good about the kind of 19% margin target for this year. Okay? So I'm just hearing that lunch is ready, and I'm sure you're kind of desperate to get a refreshment. So with this, again, I just really call you to thank you all here in the room and online, on the web, having been part of this discussion and presentations today. Thank you very much, and I look forward meeting you at another occasion or maybe at the next Capital Markets Day. So thank you very much.

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