Hello and thank you for standing by. My name is Regina and I will be your conference operator today. At this time I would like to welcome everyone to Bio-Rad Laboratories' Droplet Digital PCR Webinar. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press Star then the number one on your telephone keypad. To withdraw your question, press Star one again. I would now like to turn the conference over to Edward Chung, Head of Investor Relations.
Please go ahead. Hello everyone. We're delighted to welcome you to today's webinar focused on Bio-Rad Laboratories' Droplet Digital PCR Portfolio. With me on the call today are Jon DiVincenzo, President and Chief Operating Officer, Roop Lakkaraju, Executive Vice President and Chief Financial Officer, and Jim Barry, President of the Life Science Group. Steve Kulisch, Vice President and Genomics Portfolio Product Manager, will be making today's presentation. Before we get started, I would like to remind everyone that we will be making forward-looking statements about management's goals, plans and expectations, our future financial performance, and other matters. These statements are based on assumptions and expectations of future events that are subject to risks and uncertainties. Our actual results may differ materially from these plans, goals, and expectations.
You should not place undue reliance on these forward-looking statements, and I encourage you to review our filings with the SEC where we discuss in detail the risk factors in our business. The company does not intend to update any forward-looking statements made during the call today. After the presentation, we will open up the call for Q&A with analysts. With that, Steve, please take it away.
Welcome and thank you for joining our presentation today that is focused on Bio-Rad Laboratories' Digital PCR business. My name is Steve Kulisch, Vice President of Product Management for the Life Science Group's Genomics Portfolio. In this webinar, I will walk you through the evolution of PCR technologies and the origin of digital PCR, including the power and value of Bio-Rad Laboratories' droplet-based approach.
I will highlight Bio-Rad Laboratories' view of the absolute quantitation segment, with a focus on customer sentiments and applications that are driving significant shifts in technology utilization, research, dollars, and growth. We will finish with an overview of Bio-Rad Laboratories' portfolio of platforms and assays and show how we are positioned to grow our core business with continued service of customers in biopharma and oncology who require the capabilities that only we can provide. Additionally, our newly expanded portfolio of platforms and catalog assays designed to address customers adding digital PCR capabilities to their laboratories will enable us to expand the market, our business, and power the future of digital PCR. Bio-Rad Laboratories has had a significant role in shaping the history and evolution of PCR-based technologies over the past 30 years.
The first generation of PCR dates to its discovery in the late 1980s by Kary Mullis, later awarded a Nobel Prize for Chemistry. This technology both dramatically expanded the biotechnology industry and was a workhorse of the human genome in the late 1990s, which Bio-Rad Laboratories heavily supported with its own PCR devices. Second generation PCR technologies, known as quantitative PCR or qPCR, introduced the use of fluorescent probes and quenchers to make PCR reactions detectable in real time, providing a relative quantitative measurement.
This advancement enabled researchers to use PCR to quantify starting amounts of nucleic acids in a sample for the first time and became broadly used to advance our understanding of more complex biological systems. Bio-Rad Laboratories had an important role in expanding the use of PCR with simplified, lower cost technologies in the 2000s, which brought this important capability to more scientists around the world, and we continue to maintain a strong position in qPCR technologies today. This brings us to digital PCR and third generation advancements developed by Bio-Rad Laboratories starting in 2010. With our experience over the prior 20 years of PCR technologies, we understood what improvements were needed to advance our customers' scientific capabilities, immediately recognizing the power of droplet digital PCR and how the absolute quantitation of nucleic acids with sample partitioning could power new and unique capabilities in key areas of research.
While sample partitioning is a seemingly simple concept, the ability to take a large sample of nucleic acid quickly, divide it into tens of thousands of subsamples, and then interrogate each is a technique around which Bio-Rad Laboratories established a strong patent portfolio and unique capabilities that has driven Bio-Rad Laboratories' journey in digital PCR over the past 15 years. Bio-Rad Laboratories' innovation journey helped establish and build utility of digital PCR technologies today, and it all started with the 2010 commercialization of the first digital PCR platform, the QX100 Droplet Digital PCR System. Since that time, we have continued to improve and expand our platforms and assays. For over a decade, we developed products and technologies to serve not only life science research, but we're the first to release an FDA-cleared and CE IVD registered IVD system and diagnostic tests.
We are also so confident in our droplet based partitioning approach that we were the first system with precision and accuracy claims to be backed by independently measured metrology institutes. As we continued to gain customer trust in our technologies, adoption grew with researchers demanding the highest performance for critical applications in cell and gene therapy, which has become important in determining the safety and efficacy of manufactured therapies. Today, we have empowered the scientific community with a foundational technology, products, and support to help generate more than 12,000 peer reviewed publications all powered by Droplet Digital PCR. The value of Bio-Rad Laboratories' droplet based partitioning approach in digital PCR is multifold and for scientists the result is the highest quality data that they trust for their most important research.
Digital PCR works by splitting a sample into thousands of tiny partitions. Bio-Rad Laboratories platforms do this with droplets where each droplet contains either zero copies of a target molecule or one or more copies of a target molecule, which can be increased in number within the droplet with PCR until detectable with fluorescence. By counting positive and negative partitions and applying Poisson statistics, we enable counting of an absolute number of target molecules in a sample. Partition size and volume uniformity are critical to achieving precise, sensitive, and reproducible measurements. Calculations required for digital PCR measurements assume that each partition is the same volume.
If some partitions are larger or smaller, then the chance of capturing your target molecule is variable, breaking a critical part of the underlying calculation and skewing concentration estimates. Bio-Rad Laboratories' droplet based partitioning technology has been verified by independent metrology institutes to consistently create droplets with uniform volumes to standards that surpass any prior technology. This is why customers adopting Bio-Rad Laboratories droplet based digital PCR platforms get the precision and accuracy they expect and have confidence in their data run after run using both the same instrument and different instruments. Droplets can also uniquely provide flexible partitioning capabilities and are not physically fixed, enabling them to be dynamically scalable with the ability to create thousands to millions of droplets depending on the analytical needs of the researcher.
This capability enables droplet-based technologies to more easily provide greater sensitivity, accuracy, and dynamic range of linear detection with increased numbers of droplets. They are also dynamically sizable and able to adjust in real time the volume of droplets if needed to create concentration gradients as an example. It is for these reasons that droplet-based technologies are the ideal platform to serve a growing and changing landscape both now and into the future. The performance and consistency that droplet-based partitioning offers is crucial for more demanding applications in oncology, biopharma, and biosurveillance and is a key reason why Bio-Rad continues to be a trusted partner to scientists around the world. Our platforms, assay catalog, and novel tests enable the highest levels of sensitivity in oncology, surpassing even next generation sequencing in the monitoring of disease progression. Let me give you a few examples.
First, liquid biopsy is becoming the standard of care because it's non-invasive, but success depends on finding a single mutant molecule among over 10,000 normal ones. If partitions aren't uniform, results can be skewed, leading to false positives or negatives. Uniform partitioning ensures the accuracy needed for trustworthy clinical insights. Second, in treatment monitoring like BCR-ABL and chronic myeloid leukemia, clinicians rely on precise copy number tracking to decide whether to continue, adjust, or stop therapy. Partition variation breaks the math behind quantitation, creating risk of error. Uniform partitions deliver reproducible results across time, site, and instruments, critical for patients followed over months or years.
While I offered a few examples of why the power of droplet-based approaches are so important in demanding applications like oncology, Bio-Rad platforms and the validated assay kits are also the products of choice in biopharma manufacturing where sensitive and reproducible testing is important for dose control and critical for contaminant testing. Finally, when the world was facing a pandemic crisis, Bio-Rad was the go-to technology for monitoring infectious disease spread in communities across the world with highly effective wastewater testing strategies. Due to the reliability and capabilities of our systems, wastewater testing has transitioned to a durable business with the support of private partnerships and the U.S. Government establishing biosurveillance programs.
While technologies enabling absolute quantitation are not limited to just digital PCR technologies, increased adoption of Bio-Rad Laboratories' Droplet Digital PCR technologies along with existing orthogonal technologies like targeted sequencing and older technologies like microarrays have expanded this market category over the past decade. Today and into the future, growth will continue to be heavily influenced by the adoption cycle of digital PCR. Early growth in the absolute quantitation segment was driven by adoption of Droplet Digital PCR technology for novel applications like the need for increased sensitivity in liquid biopsies and accurate titers of gene therapies mentioned on the prior slide. Today, growth is being driven by the increased adoption of a greater collection of digital PCR technologies alongside quantitative PCR and next generation sequencing for currently unmet needs accelerated by accessible price points, simplified workflows, and proven technologies demonstrated by scientific publications.
As we move forward, growth will be fueled by the ongoing use and application expansion of a growing installed base with consumables driving a large part of growth. Additionally, customers' needs for better precision and sensitivity will accelerate the adoption of digital PCR over time. As the clinical utility of digital PCR is proven, digital PCR will move into routine use for diagnostics. Researcher needs for better precision and sensitivity has been accelerating the adoption of digital PCR technologies. Customers are increasingly finding value in digital PCR as the orthogonal or in some cases an alternative tool for nucleic acid analysis. This is due to the advances that digital PCR offers over next generation sequencing and quantitative real time PCR technologies that are both widely used today.
While NGS establishes a high level of multiplexing that is well suited for discovery work, it frequently comes with a high cost, complex bioinformatic analysis, and a turnaround time for results measured in days to weeks. Though the cost of sequencing is coming down, instrument and reagent cost is only part of the expense. A more complex workflow means more labor hours plus the cost of data storage and bioinformatic pipelines, resulting in a high overall cost. Quantitative PCR is a proven technology that is typically low cost and delivers very fast results. However, the results between runs and laboratories can vary greatly, and while the workflow is simple and runtimes are fast, the data analysis can be complex due to the use of standard curves to get a quantitative result.
Digital PCR as a technique and droplet digital PCR technologies specifically are increasingly addressing evolving customer needs such as obtaining more sensitive, accurate, and reproducible results more quickly, more easily, and at a greater value. These important advantages are why we see increasing adoption in applications like oncology and biopharma QA/QC environments replacing NGS and quantitative PCR techniques respectively. That said, quantitative PCR and next generation sequencing will remain important technologies within the laboratory ecosystem, providing capabilities and value that digital PCR does not yet provide and will remain complementary technologies as Bio-Rad Laboratories advances its droplet digital portfolio over time. With ongoing investment in new innovations, we will increasingly drive adoption of digital PCR as a replacement. Bio-Rad Laboratories' droplet digital PCR systems offer higher sensitivity, faster turnaround times, and dramatically reduced costs per sample as compared to next generation sequencing.
It is important to note that while droplet digital PCR offers clear advantages, it will not replace NGS entirely. Certain applications such as detecting complex genomic signatures and disease that require massive multiplexing will continue to depend on the broader capabilities of next generation sequencing. Customers who are currently using quantitative PCR are enhancing their labs' capabilities by adding digital PCR for research requiring the sensitivity and reproducibility that quantitative PCR cannot provide. Additionally, they want a simple and familiar workflow. Customers adding digital PCR capabilities to their labs will accelerate over time as costs continue to drop and eventually reach parity with the cost per sample of quantitative PCR. Bio-Rad Laboratories, with its well-established portfolio of PCR-based technologies, will provide an ecosystem to facilitate increasing adoption of droplet digital PCR and the seamless use of all PCR-based technologies in the laboratory.
I am very happy now to use a few slides to highlight some aspects of Bio-Rad Laboratories' droplet digital PCR platforms and assays. I will start with a high-level summary of the value of our core portfolio, followed by short descriptions of the value that both the QX Continuum and QX700 series bring. Our core Droplet Digital PCR portfolio consists of three instrument platforms for research and one for diagnostics, supported by a suite of consumables and analytical software. This portfolio has been built and evolved over a decade to become a technology and brand that scientists trust and rely on for their critical discoveries and life-changing diagnostics. Our core portfolio, including the QX200 and QX600, QX1, and QXDx, have long been relied on and trusted in support of the most complex and demanding applications.
Select systems are additionally built with IVD, CE-IVD, or 21 CFR for use in regulated laboratory environments, supporting future growth of Bio-Rad's biopharma, oncology, and diagnostics users now and into the future. Last, we have built this business with the support of highly trained and knowledgeable global support teams whose value and reputation in the marketplace will extend across the entire portfolio. The addition of the QX Continuum and QX700 series platforms enhance the total Droplet Digital PCR portfolio, adding more features and capabilities to our ecosystem. The QX Continuum delivers a fully integrated workflow that is the most qPCR-like digital PCR system commercially available. Simply load samples onto a standard PCR plate and start your run. Users can run one sample, 96 samples, or any number of samples from any well in any order.
The best part is that the cost per sample is the lowest available and will be the same whether you run one sample or 96 samples. The use of standard qPCR plates also means that labs do not have to stock unique plastics to run independently on their qPCR and digital PCR device, simplifying their laboratory processes. The QX700 series systems, the 700E, 700S, and 700HT, deliver the highest multiplexing available in the market today, all in an integrated workflow with scalable throughput. The 700E provides all the essentials needed to get started with digital PCR in a 48-sample format at the most accessible entry price point. The 700S and 700HT provide the same performance and sensitivity in 192 and 384 sample formats, respectively. All systems from 48 to 384 operate on the same foundational technology, making them easily adaptable and scalable to a lab's growing needs.
The addition of the QX Continuum and QX700 series to Bio-Rad's core portfolio gives us the most comprehensive lineup of systems available, enabling us to meet the needs of any customer in any segment with any research need. While we have established that our core portfolio will continue our successful growth in our positions of strength, the QX Continuum and QX700 series additions enable Bio-Rad to accelerate the conversion of QPCR to digital PCR for more routine applications. Let us now take a more nuanced look at how Bio-Rad positions our Droplet Digital PCR platforms in the segments we serve, specifically with academic and translational research, biopharma and clinical research and diagnostics. While many of our platforms are suitable for a broad range of customer needs, we do see some systems aligning more naturally to certain customer requirements around throughput, multiplexing, sensitivity, and price.
Academic and translational research customers moving to digital PCR from technologies like quantitative PCR need a simple and familiar workflow with efficient operating costs without compromising data quality or throughput. Moving up the slide, other research customers need higher performance or multiplexing capabilities where we have the QX600 and QX700 series systems offering higher performance with additional features. Moving to the right, we offer the QX700HT and QX1 systems for customers needing higher throughput such as those in biopharma QA/QC, and for our customers adopting Droplet Digital PCR systems in clinical labs, we have registered systems available. Our QXDx and QX600 DX Droplet Digital PCR systems facilitate adoption of digital PCR in a clinical setting, especially in the monitoring of hematological cancers and of solid tumors via liquid biopsies.
While the primary challenge in driving broader adoption of digital PCR remains the inherently slow cycle of clinical adoption, particularly when replacing entrenched, validated, and often reimbursed assays, Bio-Rad is actively working to accelerate the adoption of Droplet Digital PCR through partnerships and strategic investments like Genioscopy's ddPCR-based Colorectal Cancer Screening Test or Insight Molecular Diagnostics ddPCR-based Transplant Monitoring Test, as well as our own IVD Registered Menu of tests. Fueling the value and utility of Bio-Rad's Droplet Digital PCR platforms is our industry-leading catalog of over 490,000 validated assays. Bio-Rad's assay catalog is pipeline driven and populated via internal innovation assays, powerful design algorithms, custom assay design services, and external partnerships.
This internal innovation drives some of our most high value tests in oncology, public health, and cell and gene therapy and drives adoption of Bio-Rad Droplet Digital PCR platforms by offering existing customers access to new and novel tests to increase use and expanding installation of our systems in new areas of research. Our industry leading assay catalog enables novel research and new discoveries across a wide and expanding range of scientific disciplines. Foundational mutation and copy number assays for oncology research and diagnostics that leverage patented technologies have driven new discoveries important to advancing human health. Our infectious disease portfolio was a critical tool that provided essential information to global and local health agencies to keep the population safe during the pandemic and continues to serve as an important part of ongoing sentinel programs via adoption by Verily Life Sciences Public Health Solutions Program with the CDC.
We continue to serve and partner with an expanding collection of multinational biopharmaceutical companies to add novel assays that ensure the safety and efficacy of new therapies. We continue to work alongside customers to advance our assay portfolio into new research and diagnostic categories to expand the value of Bio-Rad's Droplet Digital PCR platforms. Finally, to better facilitate the broad range of PCR instruments across laboratories, we will release in early 2026 an additional 600,000 assays that are validated for both quantitative PCR and Droplet Digital PCR. This will enable customers to seamlessly use both techniques and Bio-Rad products in their laboratories, supporting and driving Bio-Rad's installed base of platforms for years to come.
While it can be easy for any company to claim technology superiority or quantify platform placements or consumables pull through to demonstrate adoption, at Bio-Rad, an important measure of success is the scientific value of the technologies we sell and support. This is one reason why we track scientific publications as an additional important measure of value and utility. Within a simple chart showing the history of our over 12,000 peer reviewed publications, there is a powerful message of value. Scientific publications are written reports that communicate original scientific research, analysis, or scholarly work to the scientific community and are typically published in peer-reviewed journals, conference proceedings, or academic textbooks. These publications are consumed broadly in the scientific community to advance knowledge, facilitate discussion, and serve as a basis for education and future research and discoveries.
They also serve to highlight the enabling capabilities and utility of existing and new technologies and techniques driving the adoption of products in the global scientific community. With more value and utility in science, the greater the adoption of the product leading to even more publications that drives a cycle of increasing adoption. Over the first decade of commercialization of Droplet Digital PCR, Bio-Rad platforms and assays were cited in roughly 6,000 scientific publications. However, since 2021 we have averaged about 2,000, that's right, 2,000 publications a year. This is not just a dramatic acceleration of peer-reviewed science using Bio-Rad Droplet Digital PCR, but validation by the research community that Bio-Rad is the partner of choice for research that must stand up to rigorous review from their peers around the world.
Additional insights that we can see with AI-based analysis of our curated publications are that primary research still outnumbers review articles. While early publications from 2012 to 2015 were focused on foundational method development of Droplet Digital PCR technologies, there has been a very strong shift in recent years towards clinical applications in cancer, virology, and liquid biopsy. Cancer as an area of research is the topic of 20% of all publications. It is clear to us that Droplet Digital PCR technologies are not just powering the future of digital PCR but also the future of scientific discovery and the improvement of human health. In closing this presentation, I would like to summarize Bio-Rad's right to win. Bio-Rad's demonstrated superior foundational technologies provide fundamental performance critical to meeting the needs of the most demanding customer applications.
The strength and value of our portfolio is validated by the very scientific community we serve through the historic volume and recent rapidly accelerating pace of peer-reviewed publications using Bio-Rad's Droplet Digital PCR technology. Bio-Rad Laboratories has one of the most comprehensive portfolios in the industry, enabling us to serve customer needs in all segments, and we will use this portfolio to serve customers requiring the highest performance in oncology, regulated biopharma manufacturing environments, and customers increasingly shifting their research from quantitative PCR and next generation sequencing to Droplet Digital PCR. Bio-Rad Laboratories' industry leading portfolio of validated catalog assays will continue to fuel the use and utility of our platforms and power the future of digital PCR.
On behalf of Bio-Rad Laboratories, I would like to thank you for your time and attention and continued participation in the Q and A session coming next, which will be hosted by our Chief Operating Officer Jon DiVincenzo, Chief Financial Officer Roop Lakkaraju, and Life Science Group President Jim Barry.
We will now begin the question and answer session. In order to ask a question, simply press star followed by the number one on your telephone keypad. Our first question will come from the line of Patrick Donnelly with Citi. Please go ahead.
Hi, this is Brandon on for Patrick. Appreciate all the color on the portfolio and the PCR market to kick things off. I was wondering if you can go into a little more detail on the, if there have been any changes in the market assumptions for both the digital PCR market and the digital droplet PCR market. I think in the last investor you guys kind of sized the digital PCR market at around $6 billion, growing at least 10%. In the digital droplet PCR market around $4 billion. I was wondering if those assumptions have changed overall over the last few years and anything specific in terms of like contributions to Bio-Rad long term would be helpful. Thank you.
Yeah, hey Brandon, this is Roop. I'll maybe start it off, I guess. I think a lot has changed since 2022 with the investor day, and let's recognize that. I think in the presentation we actually indicate that the digital PCR market we're estimating around $600 million. That includes things like our droplet digital PCR but also array technologies and other areas that others play in. From our standpoint, what we also see though is that we articulated within this presentation is the migration of QPCR as well as NGS into droplet digital PCR for the value proposition that we articulated. I think it's changed quite a bit since 2022.
The last thing I'll add here as we think about future growth rates, we've indicated as part of our last earnings call in moving our 2025 numbers up slightly because of the expansion of our portfolio with the Stilla acquisition and Continuum launch, we've kind of taken our growth rates up to kind of mid single digits from low single digits. I think longer term we see it as a potential high single digit type of growth rates, potentially dependent upon how the end markets and instruments kind of capture evolves in the coming quarters.
Perfect, thank you. To follow up, also in the last few years we've kind of seen a lot of other players bring out new instruments to the market. I'm just curious how you guys have seen the competitive dynamics shift over the years and how you see these upcoming launches with the QX Continuum and QX700, how you see those impacting those dynamics. Thanks again.
Yeah, of course. First, let's start out with the part of this conversation that was really to highlight our expansive portfolio that we have across droplet digital PCR. I think we've done that very well here today. When you look at our portfolio and how we can address different aspects of the market, I think we've got a broader reach than anyone else in the marketplace. When you add to that our assays and the magnitude of our assays to address different customer needs, it's unparalleled. From our standpoint, as we think about it, we're already a market leader in digital PCR. I think with the expanded portfolio, it gives us a greater opportunity to take advantage of future growth rates in the digital PCR area.
Yeah, Brandon, this is Jon DiVincenzo. Just to reiterate, I think that Steve Kulisch did a nice job showing not only the volume of scientific publications, peer-reviewed publications, but the acceleration in the rate by which the technology is being utilized in the marketplace. That just kind of confirms the usability and the importance of the platform. Our broader portfolio now simply allows for more, more discrete solutions for different applications. We're super excited about the expanded portfolio. As Roop Lakkaraju said, it allowed us to raise kind of our guidance near term. We believe as we continue to build momentum into 2026, it'll be one of the faster growing segments of our portfolio.
Our next question will come from the line of Brandon Couillard with Wells Fargo. Please go ahead.
Hey, good afternoon. Thanks for doing this webinar. It's very, very helpful. Any numbers you can kind of frame around for us in terms of the end market mix and applications, kind of the percentage of the portfolio today, that's academia versus biopharma and maybe research versus clinical. You said wastewater is kind of a durable piece of the business. How big is that? Is it still growing today?
Yeah, I guess. Brandon, you know, we'll, and I appreciate the question and thanks for joining us today. I think we're going to stay away from trying to size our portfolio in the mix within the end market, specifically within this conversation. I think that's something we can articulate as we move forward down the road. Maybe if I could have Jim just touch on, you know, kind of the application in the different areas of whether it's wastewater or oncology, etc. Sure.
Thanks, Roop. I think, obviously we're very excited about how the portfolio shapes up and our ability to serve customers broadly based on not just the application, but their throughput, sensitivity, and plex requirements. We outlined in the presentation a few key markets: oncology, biopharma, QC, and biosurveillance. I think as we think about the durability of the business, primarily we've been focused on the translational medicine and academia space, which has been very strong in the early days for us. Obviously, we continue to see opportunities expanding, as noted in the uptick in the research publications around clinical applications. As we look at our portfolio and think about applications, we think it's the broad nature of the scale that we offer that is really how we play out the opportunity, not specifically one specific market.
I think yes, wastewater is durable, but in addition, so is our QC biopharma business. Each of them is sort of critical in how we think about combining the total business.
Okay. I think at one point the quantitative PCR research installed base was maybe 50,000 instruments first. Would you agree with that? How much is converted to quantitative PCR? I mean, excuse me, how much is converted to digital at this point?
I don't know that we have a point of view of the install base. I think that's a new data point, Brandon, that you just articulate. We can take that offline and just see kind of how we think about that, and we can follow up in terms of, you know, the—it's early innings, if you will, for digital PCR broadly, I would say. I think from a qPCR migration standpoint, it really is going to depend upon—by the way, labs and research organizations can have qPCR and digital PCR. I was just visiting customers recently where they had all of the technologies right within the lab. It really is about the end applications and the rate. I think because of the ability for us to have rare event detection, folks are finding opportunities to use digital PCR for those application of rare detection.
I think that's what's going to drive that adoption. You're going to see some level of all the technologies remain within organizations.
Okay, last one for me. I mean, one of the advantages of qPCR, right, is the low cost. I think one of the things you talked about is kind of over time is the relative, I guess it's cost per sample or cost per analyte, converges between qPCR and digital. You see greater adoption. What does that spread look like today in terms of, you know, cost per analyte relative to qPCR? Thanks.
Yeah, I mean, I think as you, if you think about the QX Continuum and the QX700 series, I think we see the overall price point moving closer together but not reaching complete parity at this point. We believe that over time that's what you'll need to see additional transition for qPCR. As we expand our application menu of qPCR assays onto digital PCR, we believe that helps open up the opportunity for the QX700 and QX Continuum. You know, when we start thinking about it. Workflow and cost per reaction, we're getting much, much closer. QX Continuum. If you think about the workflow you're bringing to the instrument, a standard PCR plate, basically the same workflow. That you'd be running on quantitative PCR and y ou're able to run one to 96 samples.
We see it as a cost of ownership coming down, and from a sort of analyte or reaction cost converging over time, but still some gap today.
Right. The real advantage there, you know, our droplet technology on the QX Continuum allows you to run 1, 2, 3 samples, whereas other technologies, you're kind of running through a whole plate at a time. I think that's the cost advantage when you actually look at real world application of the technologies. That's where we stand out, why we're so excited about the QX Continuum platform as part of our portfolio.
Thanks.
Our next question comes from the line of Tycho Peterson with Jefferies. Please go ahead.
Hey, appreciate you hosting this. Want to maybe go back to a question you had earlier just on the notion really around the transition of quantitative PCR to digital and how you think about cannibalization and is it really going to be at kind of the high end of the quantitative PCR market where you might see more, more of a transition?
Yeah. Tycho, thanks for joining today. Maybe I'll start out. Let's first understand, you know, from a high end, high, high end quantitative PCR. It's not an area that we had historically been able to address from a market standpoint. That from our standpoint is a necessary cannibalization that's additional serviceable market that we can, that we think that is supporting our future growth prospects. I don't know, Jim, if you would add anything incremental in terms of that migration and serviceable market, if you will.
I think, as I think about the movement from digital PCR to QPCR and our portfolio, I think we believe that overall it's a benefit as the migration happens. The broad portfolio we put together and how we're positioning it and then the additional assays that will be sellable onto that platform, we think overall i s a net benefit today.
Just coming back to one piece, I guess. You talked about the cannibalization. I think there's an opportunity for us to be able to, yeah, there's some level of conversion that might exist, but I think it's going to be, as I said earlier, labs can have QPCR instruments and digital PCR instruments on a concurrent basis, depending upon the application and needs, if you will. I think that's more of an expansion of the SAM versus really a cannibalization, although recognizing there may be some limited amount of cannibalization by certain custodies.
Okay, that's helpful. Maybe thinking about the clinical side of things, this might be splitting hairs, but if I look at Slide 8, you know, the way you've kind of laid that out, you've got routine diagnostics, you know, materializing about as far away from today as you had early adopters on the other side. Are you saying routine diagnostics is really 10 years out, or do you think it actually could be sooner?
No, we believe it'll be sooner. We have some partnerships today that are realizing applications and adopting that, and getting reimbursement is a key milestone for the adoption overall. I don't think we meant to be at scale there with that projection. It's sooner than 10 years.
Okay. On product lineup, just thinking about the QX700 Continuum launch. It's been kind of two months. Anything you can kind of talk about internally from the sales team, customer anecdotes, how should we think about early traction and maybe Roop, what's kind of baked into the guide for the back half of the year from the new products?
Our sales team is very excited, and I think our Product Management team did a great job at preparing all the training materials, et cetera. Right out of the gate, we were able to close the acquisition a little earlier than we had projected. A week later, we already had commercial teams in position getting trained. We've been on the road now ever since then and getting everyone up and running. There is a lot of excitement there. Our customers, I think some of them had been aware of the stellar platforms in the past, have been very much expecting and anticipating the Continuum launch for the last couple of years here. There is just a lot of excitement and we're monitoring daily our portfolio and win loss analysis, and we feel good about that.
Thanks for that, Jon. Maybe, Tyco, I'll just add in terms of the outlook for the second half of the year, if you remember, we took our guide up from low single digits to mid single digits, and that's on the back of the Continuum launch and announcement as well as the still a close by June 30. That's kind of what's baked into the second half. I think folks have estimated that kind of in the high single digit millions estimate. That's probably a reasonable way to look at it.
Okay, last one, just looking a little bit further out. How do you think about replacement cycle then? You know, with the new instruments I assume that's more of a 2026 story, but could this be a multi-year tailwind?
I think one, it's a little early. Let me say that right, it's where, as Jon DiVincenzo said, we got a lot of excitement by our customers as well as our sales teams. As you know, it's a soft market out there, and I think the considerations of the market in 2026 and beyond is something that we're still trying to get our finger on. Having said that, we do see this as a multi-year tailwind.
Absolutely. I think the magnitude or what the s lope of that curve looks like it is s till an open question based on kind of market considerations, everything else. Hopefully, as we've shown, we've got by far the most comprehensive set of solutions for customers, and we marry that with our assay and the publications and validation of what there.
That said, it's fair to say we h ave a decade worth of QX200s out there and we're bringing more multiplexing to customers, flexibility and number of samples you can run, and overall kind of workflow improvements. We should think that that's going to be attractive to existing customers as well as new customers.
Okay, I appreciate it.
Thanks Tycho.
Our next question comes from the line of Jack Meehan with Nephron Research. Please go ahead.
Hey Jack, you're a little choppy there.
Sorry about that. There you are. Hopefully. Okay, perfect. Thanks again for hosting this. Wanted to start maybe just try to level set a little bit more around t he size of the business. You talk about the market size today is about $600 million. I was estimating a little over $300 million for Bio-Rad. Around half the market. Is that in the right? The zip code?
Yeah, I mean it's not unreasonable. Each of you have kind of set numbers that you've estimated within your models. I think generally on average you're in the ballpark.
Okay, I was hoping to get a l ittle bit more color on the clinical strategy as it pertains to oncology. You mentioned some of the LDT partners you're working with wanted to push a l ittle bit more on the FDA approved strategy. It's been a few years since the BCR-ABL approval. Was wondering how much of a point of emphasis this is or other menu expansion, you know, on FDA approved products.
Yeah, we mentioned that we are supporting our partners there as they go through the FDA approval process and reimbursement approval. Right now that's our strategy is to support the handful of partners. Longer term we actually have a view of our portfolio, which ones are most applicable medically actionable results, and see over the course of 2026 and 2027, more emphasis on our own assay development and getting them approved by FDA. Right now it's really through the partnerships, but in the next one to two years more direct.
Got it. Okay. As you just talked about some of the nearer term expectations, I just wanted to clarify. I think I heard long term growth, high single digits, you thought for the business. I wasn't sure if that was market growth or Bio-Rad growth in this business. Do you see a path where this c an get to double -digit growth? Like what would be upside relative to m odel versus what's baked in?
Yeah, I think some of that is just the baseline growth, the marketplace itself. Right now, you know, we continue to see kind of capital equipment slower than we historically seen before, kind of this administration, some of the geopolitical challenges that are out there in the market. It's hard to project. We believe it's going to be significantly higher than the overall growth of life sciences, and therefore we project it at high single digit. Can it get double digit? I think a lot of this can be dependent upon funding of our customers, whether that's biotech customers or academic or overall the environment in biopharma.
Got it. Okay, thank you everybody.
Thanks, Jeff.
Our next question comes from the line of Conor McNamara with RBC Capital Markets. Please go ahead.
Hey guys, thanks a lot for hosting the presentation. We really appreciate all the detail on the product line. I don't know if you can give t his level of detail, but can you just talk about the different price points of the system offerings and what the typical consumable pull through may be on these boxes and if they're closed systems or open systems that could be used with other consumables. Just curious how much visibility you have as far as the consumable related sales a s you place these boxes.
Hey Conor, I appreciate the question, appreciate you prefacing it by saying whether we'd be willing to at this point provide that level of detail. I think from a price point standpoint, let's start there. Here's what I would say: the price point of the QX700 series is very competitive with what's on the market today. As you think about then, you know, moving up the stratification, you're going to obviously, with the incremental capabilities of the platform, the price is going to go up from there. I don't know that we want to get too much into the details of all the different pricing at this point in time on the consumable pull through. It's a closed system, and as we get placements, we'll see that pull through over the life of the usage of the instrument. We would absolutely expect that.
You know, you think about kind of what our consumable to instrument rate is today. We would expect to see that sort of pull through on a continuing basis for these instruments, but it's going to be dependent upon, kind of, you know, as Jon said, funding and how that might drive usage and everything else.
Great, thanks for that. Thanks for that color. Appreciate it. Just from a housekeeping perspective, I'm assuming all of the sales to date have been in the life sciences business, but it sounds like there's a push in diagnostics. Are you going to put that out separately, or are all future sales still in that life science business?
Historically, they've been in life sciences. I think that's a conversation that we'll look to have, but at this point in time, it's all life sciences. If we were to make a change associated with it, we'd articulate that.
Okay, great. And just last one for me. I think the last time you guys d isclosed this. It was about, you know t he split was about 50%, 50% consumables equipment. Is that still the case, or has c onsumables overtaken equipment at this point? As far as split of sales?
Yeah, consumables is a lot higher now. More recently it's kind of in that 70/30, 80/20 depending upon quarter to quarter. Obviously, it fluctuates at this point, and that's really driven by the soft instrument market overall, but at the same time activity continuing and the consumable pull through, staying strong.
Yeah. As we announced in the last earnings, you know, consumable is growing mid to high single digit overall, and that's been the case for nearly two years now. It's kind of shifted that, you know, ultimately, you know, two thirds consumables, a third equipment is probably where we see the steady state business.
Great, thanks for all that color. Really appreciate it.
Thanks Conor.
Our next question will come from the line of Dan Leonard with UBS. Please go ahead.
Thanks very much. Just a couple of clarifications on the competitive differentiation. Steve talked a bunch about the uniform partitions of your droplet digital method. Is that not a feature of the plate-based methods as well, the uniform partitions?
Yeah, great question. What we believe is that droplets offer a level of consistency, partition, partition that through the metrology institutes has been validated and proves that consistency and performance is repeatable platform to platform. We stand by droplets as our primary technology. We were excited that still have brought droplets to the table, and it allowed us to sort of round out our portfolio and broaden the offering. I think that's how we would position it today.
I just think just pragmatically the f act that you can run a single s ample and only pay for other reagents associated with a single sample is a great advantage versus the arrays where you kind of utilizing template.
The comment on dynamic scalability from thousands to millions of droplets. Which of your platforms runs millions of droplets in QX1?
None of our existing platforms today have that level of droplet generation. We have done work around generating droplets at high speed. This is an area, you know, droplets as a capability is a core competency for us. I think Steve's comments were really broadly about scalability, that through droplet generation we can scale versus having to create a different architecture.
Physically, there may be in the future diagnostic applications that require that. It really is proof of concept that's been out there. It's just the fact that you can get there with this type of technology that we're trying to communicate.
Understood. Thank you very much.
Thanks Dan.
That will conclude our question and answer session. I will now hand the call back over to Edward Chung for any closing comments.
Yeah. Thank you for taking time out of your busy day to learn more about our droplet digital PCR business. Perhaps we'll see some of you at o ur upcoming EVPCR World events in the coming weeks. As always, we appreciate your interest and we look forward to connecting soon. Thank you.
That will conclude today's call. Thank you for joining. You may now disconnect.