Testing. We're good. Here we are, Investor Day 2022 for Repligen. It's been five years. Very happy to be back in town. Much has changed with the company in these five years, and we have a whole panel available for a Q&A. We have six speakers. We have nine on the panel for Q&A. I think you'll have a productive half day here with us. I just wanna make a couple brief introductions. Our NEOs, Tony, if you could just wave your hand. Everyone knows Tony. Jon Snodgres, Jim Bylund, Ralf Kuriyel, and Christine Gebski. We're also joined by other key members of our management team, Gautam Choudhary, Kola Otitoju, and Craig Harrison. So really spanning the depth and breadth of our team here at Repligen for the Q&A panel. It's going to be a pretty quick day.
The agenda is here. It's also in your brochure. We're building in two breaks, and then we're reserving Q&A for the end. Both myself and Danielle will be walking the room with these mics for Q&A. We're also webcasting this event, so there may be some questions coming in from the audience, but the priority is in this room. As we close, we'll have a 45-minute Q&A session. As you leave, we have gift boxes, so please take one. It's Bombas socks, where we are donating to homeless shelters for every box that we've purchased. There's a donation fitting into our community outreach week that we just completed last week. With no further ado, I do have to say we have a safe harbor statement.
As you know, that we will be making some forward-looking statements, and this is based on our current views and our current information, subject to change, so just be aware of those risks and uncertainties that lie within our forward-looking statements. Tony Hunt, come on up.
Okay. Thanks, Sondra. Well, welcome everybody. It's definitely an exciting time here at Repligen. As Sondra said, we've got a big chunk of the team here that will go through a number of presentations today. I think over the next two hours, you're going to see honestly how much the company has changed over the last five years. I know many of you know us really well, so it's not going to be a rehash of everything we've done since 2017. I do think we've evolved as a company, and you'll see some slides, you know, talking about what we were doing back and what we were promising back in 2017 and where we are today. I thought before I even throw a slide on.
up, that I thought it might be good to give you the Cliff Notes, right? I picked seven things that I think are take-home messages for everybody today. The first one, no surprise, the importance of single-use solutions. In Repligen's case, I think it's how we use those single-use solutions in our combination of systems and consumables. If you remember, we're very much a consumable company, and over the last four years, we've added in systems, and Gautam will talk a lot about how the systems portfolio has evolved. We end up now with not only the consumables that come from our filtration products, but we also get consumables that are coming from fluid management.
The second point is, you know, the investment we have made in fluid management has built out a new business unit for Repligen, and that business unit is growing really, really rapidly. Jim will talk about that. You're gonna see the connection between the fluid management consumables, the evolution of our systems portfolio, and then the tie-in back to our filtration chromatography products. The third take-home point from today is going to be about PAT. For those who are as old as I am, PAT was like the buzzwords back in 2000. It never really materialized. Over the last four or five years, the need for inline analytics has really increased. We've seen that with our CTech portfolio, both in SoloVPE and FlowVPE.
I'll talk a little bit about the announcement last night of the strategic partnership we've put in place, licensing agreement with DRS Daylight Solutions. The message is really around we're now at the forefront of advanced analytics in PAT. Not regular analytics, advanced analytics. The next one, fourth take-home, is around innovation. It's how Repligen's gotten to where we are today, right? We really pride ourselves on bringing best-in-class technologies to market, disruptive technologies to market, and Ralf will talk through kind of how we've addressed that for some of the main challenges in our industry and where we're going in the future. We, as a company, have to stay at the forefront of innovation. That's how we differentiate ourselves in the marketplace. The fifth one is around market evolution, right? If we...
Five years ago, we would talk about mAbs, maybe a little bit on biosimilars, but that was it. You know, five years later, we're talking about, you know, COVID vaccines, which obviously, you know, are going through its own life cycle. Cell and gene therapy, we've been able to jump very much into that market. We think mRNA is going to be a big opportunity for Repligen. For us to be successful in those markets, we have to be nimble and we have to be adaptive. We have to be able to take our portfolio and basically adapt that portfolio to the market trends that are emerging. As we go through the morning, you're gonna see how we're adapting.
There'll be one great example that Gautam is gonna point out around how we've evolved our systems portfolio very specifically for cell and gene therapy and mRNA. The sixth take-home point, and thank God there's only seven, I may never get to the first slide, but the sixth one is around our pipeline, right? We're in a great position. We have 35% of our revenue coming from commercial and 65%, this is all ex-COVID, 65% coming from clinical. On top of that, you know, we talk a lot about platforming, right, and platforming of our technologies. And you'll see as some of the numbers for how our products are getting adopted. If I take the filtration portfolio, we would estimate that 20%-30% of the wins we have are coming from our platformed accounts.
If you take ATF as an example, about 30% of all our ATF revenue is now coming from wins that are platformed accounts. It tells you we are making progress in platforming, but we've also got a huge runway ahead of ourselves because we have the right products, we've got the right people, we've got the right team, and I think we're showing how a smaller company can really differentiate itself in the bioprocessing market. The last one is about growth. You've seen how we've grown, and you'll see some of the slides, $140 million in 2017 to almost $670 million last year. We're on our way to $2 billion in that 2027-2028 timeframe.
That means we have to grow, you know, close to that 20% average over the next six plus years. That's our target, that's our goal. You ask the question then, how are we gonna be able to sustain above-market growth in the bioprocessing market? I would say there are three factors to that. The first one is around disruptive technologies and enabling efficiency, yield, and COGS improvement in manufacturing. To do that, we have to be first to market with a lot of the products that we're doing. We can't be the me-too player in our industry. The second one is around expanding into new modalities. I think we've proven that we can be very successful in catching the wave when a new opportunity emerges, whether it's cell and gene therapy or COVID.
I think the key point on new modality is we have to optimize our product portfolio to address the needs of those customers. Then the last one is we have to evolve our business. Sorry, I was looking the wrong slide for you guys. We have to evolve our business. To evolve our business, it's about winning upstream and downstream. It's around integrating process analytics, PAT, into what we do. It's the balance of M&A and R&D. Kola has been with us now a couple of years, and you can see, you know, since Kola arrived, we've been able to increase the pace of M&A, but they're all good deals for us, right? We have stayed very true to what's an important, you know, what the criteria are for doing M&A, and that's paid off well.
I would finish with this by saying that we have to continue to be nimble and innovative, right? If we can be nimble, innovative with disruptive technologies, we will be very successful as a company. If you look at the last five years, our growth has been really impressive. You know, 41% CAGR, 36% without COVID. You know, eight M&A deals done since 2017. Our cell and gene therapy growth is 35% over the last three years. We've launched eight disruptive technologies, and so these are not like me-too products we've launched. We've launched FlowVPX, TFDF technology. We've brought out really innovative chromatography systems. That puts us in a really, really good position and becomes the driver for growth as we move forward.
As I said a few moments ago, our 65-35 ratio on clinical to commercial shows you that we have a huge funnel of opportunities that are moving through, which will become the, you know, the real momentum driver for us over the next five plus years. How are we organizing ourselves in the company? Five years ago, we had three divisions. We had proteins, filtration, and chrome. They were all equally split, you know, in the mid-30s. Five years later, you can see there's a massive increase in the contribution from filtration at 60%. Proteins, chrome, analytics, or, you know, chrome and proteins around $100 million. Analytics, which just started really two and a half, three years ago, is now almost. It'll be almost $60 million this year.
There's a new division that's beginning to emerge, which is fluid management. Expect to see, as we go through the next few years, the contribution from fluid management, and Jim will talk through that, will continue to get bigger and bigger for Repligen. That's how we're organized. From a shareholder point of view, I think we've shown that we can create value for shareholders, and we've delivered, you know, on our promises. If you look at the CAGR since 2017 through to this year, it's around 41%. We've increased our adjusted EPS fivefold. The momentum that you saw all the way through 2021 is carried into 2022. We finished the first half of the year over $400 million in revenue. 20% of our revenue is COVID.
We've got really strong base business growth, so base business is ex-COVID. We've managed through some challenges like H1 and the inflationary issues we dealt with. We still saw really good growth in China, even though China was challenged in the first half of the year. We've invested in capacity, and we've continued to increase guidance where it's appropriate. You can see we've created some really good value for our shareholders. From there, you wanna jump in and say, "Okay, is the future bright when we look at our markets?" We think our markets are really healthy, right? If you look at the monoclonal antibody market, there's 800 drugs that are in phase one through phase three. For us, that's just opportunity. We'll talk in a minute about biosimilars.
You'll see that there's a significant number of biosimilars as well coming through, which again will be really good fuel for future growth. Cell and gene therapy, 500 drugs in clinical development. Again, huge opportunity for us. That whole cell and gene therapy space continues to evolve, and Vikas will walk you through exactly how we see this market playing out. If I jump to the biosimilar piece, you know, when you look at the number of programs that are active right now, it's almost 100 programs, and you look at what's been approved, just in the U.S. alone, 36 biosimilars approved, but only 21 have been launched.
When we get into 2023, you're gonna see 7 companies, and actually it'll be closer to 10 by the time the year finishes out, that are gonna launch biosimilars for Humira. On top of that, you've got four blockbuster biosimilars coming off patents in the next five years, and there will be a significant number of companies working on developing biosimilars as they are already to get those out at the time that the patents come off. We think biosimilars is a really good driver. We also think that mRNA is a major new modality. We think it's a huge opportunity for Repligen. If you look at, you know, why do we think this is good for us as a company? Well, we've worked with all the leading providers of mRNA-based vaccines.
You know, when you have established that type of relationship, it really helps as they begin to develop their next generation mRNA drugs, which are not, you know, based on COVID, but based on cancer therapy. Moderna, a significant number of programs, Pfizer, BioNTech, CureVac, are all active on non-COVID-based programs. There's a lot of partnerships in place with some of the large and medium-sized pharma companies, whether it's Roche or Sanofi, Merck or Translate Bio. It's a very healthy market. While it's small today, if we were standing here five years from now, and hopefully we'll do more than one investor day in the next five years, I would fully expect that this is gonna be something that we're gonna talk a lot about. From here, let's talk for a minute about our addressable market.
You know the story, right, four divisions. I think the take-home point here is that all our businesses are growing, right? If you look at the last two-three years, you know, anywhere from 25% to 60% growth. We're about 8% of our TAM. Again, you know, if I stand here in 2022 and look back at what, you know, John and myself started with in 2014, you know, much prefer to have this portfolio, guys. There's a lot we can do with it. We have some great products. We've got a huge commercial organization, and you've got a market that's really healthy. Expect that this will increase in terms of the number of divisions, but it doesn't change what our strategy needs to be.
For the last few years, our strategy has been around doing M&A, right? Strategic M&A with a technology focus, followed by R&D innovation. We wanna be first to market in a lot of the products that we launch, and I think we've proven that. Ralf, when he speaks, will definitely go through some of the first-to-market initiatives we've had. We want market-leading technologies. We want to do collaborations. We wanna do partnerships like the one we announced on Daylight. Then operation, operational excellence, and that can be not only in the factories getting to, best-in-class lead times, but also how do we optimize the commercial organization? How do we expand into Asia in a bigger way? These are the things that we're focused on, and I'll walk you through kind of each element with, a little bit of color commentary.
On the M&A front, you know, we've created the divisions that we have today through M&A. Now, there's a lot of stuff that we've done after we've done the deal, but in terms of how we got started, it's been through M&A. If you look at Filtration, we did three deals in a fairly quick succession between 2014 and 2017. We did Polymem last year. If you combine the revenue of all of those companies, it was $60 million. That will be around $500 million this year. We were able to take, you know, really great assets and apply them into this market. That's an eight-fold increase in revenue in the same time period. Analytics, which is three years old, has more than doubled in the timeframe that CTech being part of Repligen.
Fluid Management is up 1.5x. Again, you know, we're very focused. We have strict criteria on doing deals. We focus on the first year, second year on absolutely hitting and exceeding the targets that we put in place around revenue. We want the teams to get off to a fast start, and then we figure out what's the next thing we need to do. What should we be focusing on in R&D and getting those products to market? Speaking of R&D, we wanna be first to market with our innovative products, and we want that technology leadership. If you look at the first to market, eight disruptive technologies launched since 2017, already covered that. We are the technology leader.
We're a technology leader in process intensification upstream. Christine will talk through that in her presentation. We're the leader in harvest clarification, pre-packed columns, best-in-class affinity ligands, inline analytics. That list is growing. Five years ago, that was a short list. We're making progress. We also know and understand the value of partnerships. Key partnerships, if you look at what we've done with Purolite, Ecolab, and Navigo combined, we've been able to move out from the cloud of sort of GE Cytiva, where everybody here five years ago was asking us, "What happens when Cytiva goes away?" Or GE at the time. You can see we have a strategy now in place for our affinity portfolio, and we're executing on it.
Avitide was really the last piece of that strategy, and we're in really, really good shape in terms of how we want that to play out over the next few years. DRS Daylight Solutions. We announced the strategic partnership with Daylight last night, and they're experts in quantum cascade laser technology. What's important about that is we moved outside our comfort zone, right? If you think about what we did with Polymem a year ago, you know, here was a filtration company that was working on the municipality side of filtration, but we saw that they had great technology, great capacity, had ability to bring new products to market, so we ended up acquiring Polymem. In the case of Daylight, they're just brilliant in terms of technology they bring forward into defense.
You know, they started to play in the bioprocessing space, and I'll talk in a few minutes about why this partnership is so important. But it's gonna really put us at the forefront of inline analytics. Before I jump into that, let me spend a minute on R&D. Last year, incredibly productive year for us. Really proud of what the R&D team has been able to accomplish. 12 products launched in a year. Five years ago, if we were launching one product a year, two maybe, that was about it. 4% of our sales in the first half of the year. Really important products like XCell Lab Controllers, chromatography skids coming out of ARTeSYN, putting systems around our flat sheet cassette portfolio. Another example of being able to add in systems around a consumable that we have.
Process analytics. We brought out a GMP version of our FlowVPE, which we call FlowVPX. That's been in the market now about a year, doing really, really well. As we looked at why, you know, what do we wanna do in PAT, we felt like we needed another leg on the stool. We needed some other products that we could put in. When we started to look at the PAT space, it's a lot of what I would call simple analytics. Measuring conductivity, pH, pressure, capacitance. What I wanna do and what we wanna do in the team is create a portfolio that's advanced analytics, right? Being able to measure the concentration of your drug, which is what FlowVPE does.
When we started to talk to the guys at Tim Day and the team at Daylight, you know, they're the leader in quantum cascade laser technology. This is not about working with a company that has one technology, small company, one player, and you're worried, you know, when you look under the hood, whether it's going to work. They're putting this technology on Black Hawk helicopters. This is really great technology. They've proven their reliability in defense and in aerospace industries. They're an innovator, right? Their DNA and our DNA is so well-matched. They've already gone into bioprocessing with the Culpeo product about four years ago. It's highly accurate. It measures critical process parameters, and it's got really high sensitivity. It's in the PPM range.
We see the applications, and they see the applications, and they've already been working on it for nucleic acid quantitation, for stability studies, for protein aggregation. No one's been able to do in-line protein concentration measurement and aggregation at the same time. When we look at this deal, I think it's a testament to the two teams. Like you would expect, oh, they signed a five-year deal. No, we signed a 15-year deal. That's how much they believe in what we're doing and what we believe in what they can accomplish. They're gonna focus on the technology side of this relationship and bring all the power that they bring to defense into bioprocessing. It's about the IP that they have in this space and how we apply that into bioprocessing.
We're gonna be the commercial partner, we're gonna be the application center, and this is going to totally disrupt how PAT is done in our industry. We're really confident, incredible complementarity to C Technologies. It adds Mid-IR to UV. We do PAT. We can start to put not only our Flow into our systems, but now we can start to put Mid-IR into our systems, which will differentiate the portfolio that Gautam's going to talk about. You know, it supports the strategic vision that we have for how offline goes to at line, goes to inline, and process monitoring becomes process control. That's the journey that the industry is on, and we're right at the forefront of it.
The next year is all about applications and all about solidifying the position that Daylight has in the marketplace right now and using the power of our commercial organization to accelerate the adoption of the technology. Stay tuned. You'll hear more about it as we go through the next, over the next few quarters. I'm gonna switch for a minute, a few more slides on capacity. If you were talking, as many of you know us, talking to us over the last year or two, everything was about capacity. Okay, we need more capacity. I think Jim Bylund was sick of me saying, "Jim, we need more capacity." We've done that. We've increased our, you know, pre-packed columns capacity threefold. We've added fourfold increase into TangenX. We've done 9x on our ProConnex product line.
Just tremendous increase in capacity, invested $70 million last year, $85 million this year. You know, our lead times are down now to pre-COVID levels, and I think we're in a very good position. There's some more work to be done over the next year or so in sort of pockets that we think are important for us. We think our capacity journey, you know, by the time we get to the end of next year, I think we're in great shape for the next four or five years. The same thing is true about our commercial organization, right? We've got a growing presence. You know, we're at 275 people now in the commercial organization. We've got the right balance between sales, field apps, field service. We've got the right balance in the regions.
There's some audits we need to do, but I think we've got a great foundation how we wanna move forward. Then the last piece is really around ESG, right? Our employees ask us about it and expect it, you ask us about it and expect it, and our customers do the same thing. We had our first sustainability report last year. We made a real effort to focus this year on DEI and on recycle-reuse programs. We've put metrics and started to hire with diversity in mind at the senior level. We have reduced chemical solvents in manufacturing. We have gone ahead and, you know, focused on renewable energy, so we have seven sites up that are 100% on renewable electricity.
We've got the post-customer product recycle program, and we're looking at gray water reuse programs as well. It's an exciting time for ESG. Diane, who leads that for Repligen, is here today as well. You know, it's an important part of what we do. You'll hear us talk about it as we go through the next few years, and really trying to make this part and parcel of everything we do at Repligen. I'll finish the last slide. I think we're really well-positioned, guys. I think we have a proven track record that we're an innovation leader. I think just what we're doing with Daylight just really reconfirm in your mind that we're always looking for best-in-class disruptive technologies that are gonna move the needle for us in the marketplace. We've got a great addressable market.
We're capturing share in new modalities. Again, we've proven that we can do that. We've got a track record of strategic M&A, and that's part and parcel of what we've done. We've got great financial performance. We've set the target for ourselves to be $2 billion in the 2027-2028 timeframe, which is essentially close to a 20% CAGR over the next six-seven years. With that, I'm gonna stop. I'm gonna hand it over to Christine and Gautam, and they'll cover the upstream and downstream space. We'll take questions at the break, I think. Is it? Okay, great. Christine.
Thanks, Tony. Good morning, all. As Tony mentioned, I'm gonna speak to you about our upstream and downstream consumable solutions, sharing this presentation with Gautam, and he's gonna speak about our hardware system solutions, also in the upstream and downstream space. Before we get there, I just wanna highlight a few of our industry trends and dynamics that we see in the industry and detail how our strategy and technology solutions are very much aligning with these trends. We know from a bioprocess provider's point of view, the industry is shifting from our heavy focus on COVID solutions, right, really to back to our traditional process development and manufacturing development focused on process intensification.
We also know because 85% of all preclinical, pre-commercial manufacturing utilizes single use solutions, we know that the supplier side of the industry is very busy expanding their single-use manufacturing capability, very much like we are doing at Repligen. We also know that companies like Moderna, who's looking to expand in Japan, and BioNTech, who's looking to expand in Africa, they need. Our supply is from the supply side, we're starting to work with companies in a more regional approach, right? Versus with CDMOs in the same way. Instead of centralized manufacturing, we're finding regional manufacturing, and thus our the way that we interact with customers is also changing. From a market dynamic standpoint, what our customers are focused on is process intensification.
As Tony mentioned, many modalities companies are looking to intensify the upstream processes that they have in their development pipeline today, so they can produce more product with lower amounts of time and a smaller footprint. We also see the investment in mRNA. COVID vaccine manufacturing and approaches taught us that mRNA can be a valuable therapeutic approach. We're finding companies developing mRNA-based vaccines and looking at mRNA as an approach to other therapeutics such as cancer therapeutics. Tony mentioned that the biosimilars market is rapidly expanding.
The biosimilar providers need to be differentiated in their approach in the marketplace with their technologies, so often they're looking to implement leading technologies to help them develop and manufacture the drugs that they're looking to bring to the market, so they can be competitive against the initial supplier of that therapeutic. I also lived through the first round of the attempts at process analytic technologies back in the late 1990s and early 2000s, and the industry wasn't ready, right? Technology has taken us to the point where inline analytics and process control, making decisions at the point of manufacture, is a reality, and the benefits of that approach versus offline analytics is very much being adopted in the industry. What do we need to focus on to be successful? We...
Due to the capacity investments that we have made, we have returned to very strong lead times. We have advantages still against our competitors in this marketplace, so we need to take advantage of the reduced lead times, the off-the-shelf product status that we have for our technologies. We have core technologies that enable mRNA development and manufacturing, and we continue to expand our presence in both consumables and systems in that space. Well, we're differentiating with analytics, as Tony mentioned, and our fluid management portfolio, which really ties our hardware and our consumables together, is beginning to gain market share in the industry.
You've probably seen in different presentations some of the workflows that we use, both externally to speak with yourselves and with our customers, but really our products are setting new standards in these upstream, downstream, and analytical workflows that our customers utilize. You can see this is a traditional workflow for monoclonal antibodies, recombinant proteins, and vaccine production, and you can see through the technology map that really all of our solutions, hardware-based, consumable-based, and fluid management based, are tied directly into the upstream and downstream and analytical technologies that our customers need. We have many, many opportunities to influence not only the traditional biotherapeutic technology development that the marketplace executes, but also the new modalities, which my colleague Vikas will speak about in a little bit. We know the industry.
If I think about the upstream aspect of our technology portfolio, we know the industry is focused on process intensification. Here our customers are able to produce more therapeutics in less time in a smaller footprint. That's the basis of intensification. Traditionally, upstream cell culture has been executed with a fed batch approach, but we know through our penetration with XCell ATF and now Crossflow TFDF technology in the marketplace that we're the market leader in this space. We are creating the intensified upstream cell culture market. Customers are also looking to be really efficient in the way they produce biotherapeutics and have begun to think about continuous bioprocessing. Here we're linking an upstream cell culture step with the first capture chromatography step with semi-continuous manufacturing.
There are some companies in the industry taking that approach today, and we're fully enabling those technologies or that technology with those market leaders. Really the development of the full-blown use of semi-continuous or full continuous manufacturing in the marketplace where the upstream and the downstream technologies are fully linked will be three-plus years away in terms of GMP implementation. We've built the leadership in process intensification, XCell ATF and Crossflow TFDF are the cornerstones of continuous processing, and again, enabling intensified processing, and that's demonstrated by the technology uptake that we've seen in the industry. If we focus on process intensification for a moment, earlier this year we executed a Net Promoter Score survey.
This is where we go and we ask our customer base, "When you think about leadership, technology leadership, and upstream intensification, what supply companies come to mind?" Right? You can see from this word map, the larger the company name indicates leadership position. Repligen is the known leader for upstream intensification in the industry. As I mentioned, that's because you can produce either with ATF technology or TFDF technology, you can produce more cells in your bioreactor, and those cells ultimately produce more biotherapeutic of interest. You can intensify your processes and ultimately produce more therapeutic in a smaller footprint and in less time. With ATF, we have market leadership in traditional therapeutics, monoclonal antibodies, recombinant proteins, vaccines, and with TFDF, we're beginning to set the standards for viral vector manufacturing in the new modalities market.
With our customers, really the proof is always in the technology capability, right? These are two examples. On the left side of the screen an XCell ATF example, we worked with MSD on vaccine production. This is deep work that our field application scientists are doing every single day. MSD was producing this particular vaccine with a traditional batch process. They looked to intensify the process with XCell ATF technology and were able to produce five times the cell density in a given bioreactor, and therefore five times the amount of vaccine.
That's a very significant, impactful result when you're thinking about upstream cell culture processing and the yield, you know, the productivity of a particular plant producing this vaccine. On the right-hand side of the screen is an example of work that we've done with McGill University, with Crossflow TFDF technology, and here very similar outcome, right? McGill was producing lentivirus for viral vectors, gene therapy approaches, and they were compared to the traditional batch process. They were able to intensify with Crossflow TFDF and get an over 30-fold increase in the amount of viral vector produced in the same cell culture volume. Again, an extremely impactful result and an example of how we are setting the technology leadership in the marketplace today.
Okay, we're also expanding our leadership position on the upstream side, through enhanced performance that we're seeing with the new products that are coming through development. Enhanced cell culture performance with our new ATF controllers and with our TFDF systems. As Tony mentioned, we speak a lot about our traditional applications with monoclonal antibodies and recombinant proteins, but these technologies, both ATF and TFDF, are now expanding into new modalities. We see expansion into the cell and gene therapy markets, including cultivated meat, and also into plasmid DNA production, which is enabling gene therapies. Within Repligen, we have a database that runs in Salesforce that helps us track all of our technology usage, filtration, and resin and other consumable usage.
We know that on the first pie chart here, we can track the technology usage by biomolecule type. We know that with ATF and TFDF in our upstream portfolio, about 60% of the technology usage is with those traditional therapeutics. Close to 40% of the technology adoption is in those new modalities, right? We expect as our corporate revenue has changed over time, these pie charts to change over time because we're penetrating all of these application areas. We also look at technology adoption by phase of use in our customers' settings.
The second pie chart here shows that, with ATF and TFDF, that about 50% of our technology usage is in early clinical development, and the other 50% is in late phase and commercial. The late phase and the contribution from late phase and commercial comes from the length of time that we've had these technologies in the industry. The pipeline is very rich, with over 50% of the opportunities that we're working with customers on today being in early phase clinical development. Those opportunities will continue to grow over time and advance in scale and advance in the amount of product that they're utilizing from Repligen. Okay, transitioning now to the downstream side of our consumable technology portfolio. I wanna highlight what we've accomplished with respect to affinity ligands and resins.
With our relationships with Navigo and obviously Avitide being part of Repligen now and our relationship with Purolite, we've brought many affinity chromatography solutions to the marketplace beyond the traditional Protein A resins. They're enabling viral vector purification and the purification of challenging monoclonal antibodies. Developments in this space also help us enable new content for our OPUS pre-packed columns, right? We can ultimately provide a pre-packed column to the marketplace with our own affinity resin solutions, again, bringing more value to that end user. On the filtration side, as you all know, we offer both flat-sheet and hollow fiber filtration consumables. They're market-leading, highly scalable filtration solutions for tangential flow filtration operations.
We're able to combine these consumable solutions with our flow paths through fluid management and ultimately configure, filtration assemblies that are, you know, a lock and key solution, with our systems portfolio. If we look at the adoption of our chromatography and filtration solutions in this downstream space, on the left-hand side bar chart here, you can see that our OPUS pre-packed chromatography columns we've experienced over a threefold increase in the placement of OPUS columns into the marketplace, over the past five years. This demonstrates that we offer a differentiated service-based solution that brings efficiency into clinical and, commercial manufacturing spaces. In addition, you can also see similar pie charts for our, flat sheet and hollow fiber technology adoption.
Kind of the converse of what we saw with XCell ATF and TFDF, with over 50% of our solutions with hollow fiber and flat sheet are actually utilized in the cell and gene therapy space and less so in the monoclonal antibody and traditional biotherapeutic applications. Again, here, very strong pipeline of opportunities, technology opportunities that are in early phase clinical development, which will ultimately drive our growth over time. My goal here was to demonstrate both our upstream and our downstream technology solutions, demonstrate how our consumables tie in with our fluid paths, our fluid paths, and ultimately, provide that lock and key solution that feeds and links very strongly with our system solution. With that, I'll hand it over to Gautam, so he can speak with you about our hardware and system solutions.
Thank you, Christine. Good morning, everyone. I think as we think about the downstream applications, I'd like to take probably the next few minutes just talking about integrated systems and how they allow our customers to actually perform these unit operations. This journey for us began roughly about four years ago with the integration of Spectrum Laboratories into Repligen. During that time, you know, we received the first tier of these products, some of the pictures you see on the walls at the back here. And since that time, we've significantly enhanced the performance and delivery of these systems so that you have a very differentiated portfolio for TFF and chromatography.
Maybe before I go into each set of systems, to take a minute to think about the philosophy behind the design team, and what they were thinking as key drivers for our customers. If you think about the cell and gene market in particular, it's very much focused around drug yields and how do we enhance those yields. Our solution to that was looking at how can we do more gentler processing within the system? How can we think about protecting the drug essentially while it's going through the pipe here, so to say, and then actually taking the design in a way where you remove areas where the product could be lost.
You have these two critical factors, and then after that, I think we asked our team to keep in mind that we have to make the system extremely simple and intuitive to use. I think once you have those parameters, this is our TFF system and chromatography shown on the left-hand side here. Once you have that robust backbone, that's the time when you can start to think about, okay, how do we go to town? How do we introduce advanced in-line sensors that Tony talked about earlier into these solutions and completely change the way that these unit operations are performed today? Hopefully, you will see in the next few slides that core theme of gentle processing, really minimizing any hold-up or losses in the system and simplicity throughout the whole portfolio.
The principal goal of our systems portfolio is to be able to drive the consumable stream. Now, it's very much like the razor-blade model, right? Once we place a piece of hardware, then for customers, there's generally a repeat cycle of consumables that comes in every year from those clients, as the life cycle of the drug changes from clinical to commercial manufacture. What you see at the top of the page here is our benchtop solutions that came from the Spectrum integration. These are very much the workhorse of the industry today. Be it in a lab or in a pilot setting, you see thousands of these all around the world being used by customers.
As these customers start to translate to GMP production, they will move from the smaller systems to the larger ones that are shown here. Now, the piece that differentiates us from the competition is the highly configurable and modular nature of these systems. It's very much about allowing the customers to mix and match different components so that as their process evolves, they don't have to buy a piece of new hardware each time. That theme is what you see in the hollow fiber segment and TFDF segments that we have. We wanted to keep that philosophy, but what we were missing at the time was systems for flat-sheet cassettes as well as for chromatography. That was really plugged with the acquisition of ARTeSYN that we brought into the family.
Here you can see a picture of the flat sheet cassettes and chromatography. Lot of emphasis on keeping the design simple, as I talked about before, but this component of scalability. Why is that critical in a cell and gene, especially in a cell and gene environment? Well, the timelines have got compressed from pre-clinical to commercial manufacturing, especially when you have things like orphan drugs that tend to get launched faster.
We achieve that by allowing these systems to essentially have more or less very, very similar component, critical components that are in there. May it be valves, may it be sensors, may it be how they get mixed, if you can keep all those parameters to be similar, then the customer can easily scale from small volumes to large volumes without having this concern that, you know, the process won't have to scale, and they'll have to start again. Maybe a spotlight on the smallest member of the family. This is the KrosFlo RS20 system that we launched about a week or so ago in the market. This is very much about being able to address specifically the needs of gene therapy and mRNA customers.
The transition that's happening in that market is customers looking for a way to do small volume GMP production, and may that be for individualized cancer treatments, may it be for just often small batches of gene therapy product. There is a need out there in the marketplace to have a system that can do all of that processing. The gap versus the systems that are out there, the benchtop systems that are out there from our competitors and even from us, was around automation. We were able to highly automate the system as well as introduce the same industrial components that you find in large skids into this small frame. When you bring those two things together, you're able to then actually have a solution that's very much GMP-ready for small volumes. This is a core focus for us.
When you go about thinking around the portfolio, of course you have hardware. You see a box, you see lots of valves and pumps, but the software is a critical part of it. Our philosophy here was to be able to use identical software at the small scale, so the same software that you see here is the same one as on the large scale. That makes it very easy for operators to train and also for customers to write the same recipes from one system to another. Maybe switching topics a little bit, I think there's a real heightened sense of awareness around supply chain, and COVID only made it worse, right? Especially when you think about single-use components. In this world, I think kudos to Kola and the team.
We've been able to really pick up the right acquisition targets that allow us to bring in technology that can be used on these systems. It, it's not only about security of supply, but it also changes the game in terms of cost as well as lead times. If you can access these components easily because they are in-house, you have a very differentiated position. When you think about a system like this or even the chromatography skid, things like the flow kit and the valve technology come from ARTeSYN or EMT. When you get into the sensors or connectors, we have CTech and you have BioFlex, and right down to the membranes and resins. Those are assets that we've bought in, like Tony said, in a very methodical way to be able to bring these pieces together for the industry.
As these technologies in turn get invested on and we enhance those technologies, may it be the flow path or the valve, the system by default then stays ahead of the competition. Really important for us as part of our core strategy. I'm told this is gonna work, but I will try to one more click. Okay. This is our chromatography skid, and I think rather than focus on the video here, maybe just a few words. If you're in a day-to-day GMP suite at a manufacturing site, then during that environment, little but very critical things like, "Did the operator put the gasket in properly?" They're very much on your mind. If you have a contamination or a leak in the middle of a batch, that's a nightmare scenario for customers.
We overcome that by using overmolded technology where tubing is fused together so that you remove the gasket completely. Very simple but very effective in the way that these flow paths are created, at ARTeSYN. Now, I talked about simplicity, being a core theme for us. I think we have customers who bought these systems over the last six months, and the feedback from them is tremendous. You can see the simple architecture. We've tried to declutter the box and make it one which is very easy for the operator to access and use every day.
My second last slide, I think this talks about the real power of process management, you know, PAT that Tony talked about earlier. Here, as we think about integrating the VPX technology into these systems. What does that actually mean? So here you have to think about customers are concentrating drug product worth, you know, $10s, $100s of millions to a large extent before it can be delivered to the patient. At that time, if you are able to measure real-time data on the system using these sensors that then feeds back and tells the valves and the pumps to operate in a certain way, you can optimize that concentration and mixing step. What does that do? It allows you to have less churn and shear on the product, which really protects the product and enhances your yield.
We think that, you know, this is gonna be incredibly powerful. Of course, at the cornerstone of it, we have the ability to release batch much faster as that data is collected real time by clients. Just to end, I think we have a differentiated portfolio of systems. They're very much linked with our consumable strategy, and I think they will really help also to be able to drive the fluid management components that Jim will talk about next. Thank you.
Good morning, everyone. I'm James Bylund, and I'm going to talk about the fluid management division, and Tony referenced it. It's a new division within Repligen, and one that I'm pretty excited about, and I'm eager to share kinda some of the things that we're doing. What you see here is a typical, you know, single-use workflow, and you've seen a couple of references and examples of this during the course of the presentations this morning. What I wanna do is just baseline a little bit what we think about when we think single use and what we think about when we think fluid management at Repligen. A typical single-use workflow is comprised of equipment and consumables. The equipment's doing the processing, the consumables are carrying the process liquids.
Within consumables in a workflow, the consumable is either fit into a piece of equipment for the processing, or it's transferring the fluid between unit operations or storing it. Those are the functions of the consumable. If you reflect on that and the importance of what's taking place in those consumables, I think there's three elements that are really paramount in a consumable process. One is the component set that you have to use to allow you to govern the consumable. The second is how you design that consumable. Then the third is execution. It's really the capability or the component sets that you have, the way that you design it, and then the execution of that fluid path.
When we think about it then, that's what fluid management means to us, is the consumable side of a single-use bioproduction workflow. It's not surprising that when we went about approaching fluid management from a Repligen perspective, we took that into great consideration. Why is Repligen in fluid management? Well, one, it's a natural extension of what we already do. It's an adjacent market that is expected by our customers. If we supply the equipment, which we do, it's very natural for the customer to say, "How am I going to get the fluid to that piece of equipment? How am I gonna transfer that material from that piece of equipment?" Fluid management is the connectivity that takes place in that workflow.
It also is important to us because in order to optimize our equipment in the market space, as you heard, Gautam and Christine talking about, in order for us to do that, we have to have the capabilities of fluid management. We've gotta have those competencies that allow us to optimize our own equipment that are then easily and effectively deployed into the workspace. There's a you know kind of a natural piece, both in terms of its connectivity and its extension for us. Finally, the other piece is control of our supply chain. You can't execute what you don't have. In fluid management, it's intuitive, but if there's 31 components in a fluid management assembly, and you have 30, you might as well have zero, right? You can't deliver it.
The pandemic brought that to the forefront of everybody's understanding. There's a very natural position for us in the fluid management workflow. As we think about then our approach to moving into fluid management, we thought about it in the way that I've just described. We went about and acquired first the components, because if you don't have the components, then your design isn't what it could be. We went out and we found the components. While you know them as companies, I would have you think about them as competencies. If you think about what we have assembled, we've created the ability to do complex silicone molding and extrusion.
That competency is unique enough that we actually supply many of the companies in our industry with that competency. We supply to them as well as to ourselves. We have, you know, complex silicone extrusion, complex silicone molding. We have the ability to fabricate both durable and consumable plastics. If you think about a bottle, let's say it's a 50-L bottle . There have to be ways to get liquid into that bottle. There have to be ways to get liquid out of that bottle. You have to have tubes that extend to the bottom of those bottles to get every bit of it. You have to be able to port those bottles in order to move fluid in and out.
We have the ability on both durable and consumable plastics to weld, to port, and to fabricate. We also recognize the need to have fluid control. We have to be able to control how the fluid is moving and how fast is it moving. That's why we need valves, valve blocks, the associated liners, clamps, and related components. In a lot of ways, again, you know, it's easy to think about what we have done as acquiring organizations, but really what we did is, in a pretty methodical and thoughtful way, acquired the competencies or the building blocks for fluid management. That's what our acquisitions and then the organic development work that we've done has provided for us.
The next step is, as you think about our progress in fluid management, the next step that we've taken is to be able to aggregate those competencies or put those competencies together. The way that those competencies come together is in an assembly center. We take the things that we are able to do, the various molding and fabricating competencies, and we deploy those through an assembly center that creates the point of synthesis, where all of those components come together. Now, the components in and of themselves are valuable, and we sell those in the marketplace. We use them ourselves. Again, the way that we use them ourselves is through our assembly centers.
Naturally, we have gone to the investment step of creating assembly centers that allow for that aggregation of the competencies that we have created. I'm gonna get into the detail of an assembly center in just a second, but I would just say, as we do that, you recognize that that supports not only our own equipment, our own systems, our own entries into the workflow, but those of the market as well. We play in both spaces in terms of self-supply as well as market supply. Now, just to take us a minute or two on assembly centers. There's a lot of difference between a clean room and an assembly center.
You all know what a clean room is, and that is a critical part of an assembly center. Really the magic of an assembly center is the process that flows to and flows from it. In an assembly center, what we expect to have in an assembly center is, in some ways, almost a remarkable supply chain. Again, for us to have that, what we thought was vertical integration, right? You have to have a remarkable supply chain, outstanding logistics. You've got to be able to do the appropriate inspections and transfer that into an environment that is more than just clean, right? It has to be set up for professional assembly. There are design and execution capability that are required in an effective assembly center.
Once the assembly's been completed, it has to be able to move from the assembly center to terminal sterilization back with packaging that's acceptable to move it through the industry. There's just a lot of really important attributes of an assembly center that are critical for fluid management execution. Now, when you think about all of those things and you're a customer, what I would say as a customer is, I would like that assembly center to be across the street from me. That's why, as we've done our execution within fluid management, we created regional proximity. We have an assembly center in North America.
We're fitting out our assembly center in Europe because regional proximity, and again, made even more important by the experiences that were had during the course of the pandemic, that's important to our customers. As a side note, much of the component work and the vertical integration that we do shares that same ability, the dual site manufacturing that allows for continuity of supply, assurance of supply. When we take the parts and the pieces and we put them together, it's a significant growth engine for Repligen, and it's a natural growth engine for Repligen. This is a step to an adjacency, not a step to an area that we're not confident, not familiar with.
You can see the growth that we expect from this segment, from this division within Repligen. I want to just now, you know, kind of highlight, and I'll show it as it happens. As you look at that workflow that sits within the middle of that image, and you think about the parts and the pieces that I described in terms of our competency, right? The critical elements that create the security of supply, so the security within that system are the elements that we actually have integrated. When you think about the integrity of the system, the ability to mold and overmold so that there are no connections, there's no or diminished points of failure are absolutely critical. In that design that you see right there's probably 36 points of overmolding.
That's the kind of thing that you need to have. If you want that kind of a consumable, the power of that consumable, that's the capability that you have to have yourself. You've got to be able to capture, hold, and supply yourself with that because it's too important to the overall strategy. Okay. You know, if we just then look at what we're doing and what we're thinking, you understand the frame of fluid management, how we think about it at Repligen. It's what carries the liquid through the workflow. Our steps were to vertically integrate, to capture what we consider to be unique capability that allows us to deliver fluid management products that are unique and differentiated. They're better.
They're better because we believe they create security of supply through the workflow, and we believe our approach to it through the integration steps that we've taken, through the points of consolidation in our assembly centers, it allows us to have differentiated execution as well. It's rapidly growing for us, and we expect it to continue that way. Single-use across the industry is a growing part of the bioproduction workflow. We actually expect to exceed what takes place generally in terms of market growth rates. Critical to us, and we understand it, and we are creating our capability to do it, we expect to differentiate ourselves in terms of execution. We expect to execute better than the market executes.
We've shown that in other areas of our business, and we will do it with fluid management. Finally, it's synergistic to our positions of strength within the workflow. Again, when our salespeople make a call, it's very natural to sell not only the unit function, but the connectivity to the unit function. It's leveraging the existing sales presence that we have, the commercial presence that we have, and the expertise that we have. We understand it, we understand the movement. Finally, you know, one of the things that's magic to me is, you know, as we place systems in the field, as we qualify ourselves into workflows, every time that engine turns, every time that workflow runs, our consumables run with it.
When we put those in place, each time there is a campaign, our consumables are used across the workflow, both within the equipment and connecting the equipment. Okay. With that, I'm gonna turn the time over to,
Take a break.
Oh, we're gonna take a break. I'm so anxious to get to Ralf, I thought we'd skip the break, but we'll take a break.
Okay, everybody.
If everyone could please take a seat, and we'll move along to the R&D presentation.
Okay. Good morning, guys. I'll talk about R&D. Tony talked about innovation. In R&D, there is always a question as you know that, what is the best way to innovate? What do we do? For us, it's really becoming very, very close to customer. Well, from the perspective, friendships and relationships, understanding the problems that they have and what kind of solution we can provide. Understanding those problems. Now what we have done at Repligen is we created an advanced development. I call it skunkworks. Tony doesn't like it much, but a group of people who are completely. They go to the labs, those are the creative guys, super creative guys, and they come up with solutions. Example, one of the guys, Mike Bransby, a particular party came, say, "Hey, I want to concentrate cells 40x in 15 minutes.
No one can do that. Can you guys give us a solution? He goes to the lab, he worked for a few weeks. He came here, "I think I have a solution," designing new feed tank and other things. That's once they come with prototypes, and that's the startup mentality, and I like to see that startup mentality in the guys. He come with the prototype, fail, whatever prototypes doesn't work. The one that works, then we fund it, we productize it, with all the documentation, verification, validation, and so on. Now let's go back to customer. You know, you talk to them, what do they say? "Hey, I want to make the therapy much, much less cost associated with it. I want to have better utilization of my facilities.
I want to process development fast, so I get there fast. Really important to go to clinicals and so on. I want to be. There are some really painful molecules. I want to be able to process them at large scale. Can you help us with that? Finally, you all know that the new therapeutics exosomes, lentivirus, adeno-associated virus, mRNA. They are difficult. They are new. Some of them are where the antibodies were back in the early nineties, and can you help us with that? The way we look, I call them technology platform, but they are really solution platforms. If you look at the customer manufacturing process, what do they have to do? They take cells. They have to grow the cells in a bioreactor.
The cells themselves are each one is a factory of making a therapeutic, a virus, a protein. Then they need a bunch of steps to purify, so that what you inject to the patient is pure, at the right concentration, at the right buffer environment. Within that process, what we do is upstream intensification, and Christine talked about that. Intensification is how do I get most of my bioreactor? How do I maximize the number of cells? How do I get each cell to produce as much as possible? That is through ATF, and it's a simple concept, in which you keep feeding media, nutrient media, and you keep getting rid of spent metabolites, so the cells are happy.
The game actually is only about let's keep the cells happy, either through the system, so they don't like the shears and other things, and through the nutrient environment. ATF does that. Then, there was a talk about TFDF, and I'll talk more about TFDF. It's larger pores, does it for viral vectors. In other solution platforms is our systems. So the systems need to do and Gautam talked about a bit multiple things. What we call scalable for the process scientist is, I'm doing an experiment in the lab. Is it predictive of manufacturing scale? So we pay a lot of attention to make sure the fluid mechanics, the holdup volumes, everything, gives attributes to the system so that it's predictive. Then there are other things, do not lose any of the product you make during the particular step. So we have really gentle flow properties.
Some of those guys are sensitive to shear and antiviral, for example, or some proteins are aggregating. Then there's the automation piece. I mean, all the systems at first look, they look easy, but there are a lot of things going on. If you look at the chromatography system, for example, in certain steps, the pH has to be gradually increased at a particular slope. How do we make those controls? That's the kind of work we put to make the systems really good controller systems. Finally, the user interface, where the user can intuitively look at the screen, can program it to the job the system should do. Affinity purification is really important. Affinity is a chromatography step that is the highest purification factor.
If one doesn't use affinity, you have to use multiple steps to get to the purity level you want. As Tony talked, you know about the Avitide. We have now libraries to rapidly come up with affinity purification. It reduces the number of steps, it reduces buffer usage, which is a big cost in those factories, the facility utilization, and so on. In some cases, affinity purification enables, meaning that if it's a difficult molecule, if I don't use affinity, I have to do multiple steps to do the purification I want. Each step, I lose my yield. We really are looking for ways, and we know some products, AAV products, you know them, to go further, rapidly give affinity solution to our customers. Finally, the last one, Tony mentioned it. These are the vision systems that are smart.
They keep sensing all the properties of the product and they are enough the yield that we want. Technology we invented four, four years ago. Where you sweep it. What happens if we put a depth filter, which has much higher capacity and operate in the tangential mode? Pore is large, so viruses can pass through. TFDF, and now we look at them as. I'll give a specific example with customers at some point the protein therapeutic. I'll give more specific example. Protein A is used to produce antibodies. Usually, the solution is batch. Point five. Some antibodies are not happy at 3.5, so they start to form aggregates, which is a yield loss, or they become prone to make aggregates that a few steps later you see aggregates.
We came up with a new affinity ligand where now you could elute the protein, harvest it at pH 4.1, 4.2. It's much milder and you do not lose yield because of aggregation. We work closely with the team at Biogen, and they gave a great presentation in the ACS conference, and now we're gonna go joint publication with them on how people can use this technology for higher antibody yields. Inline process monitoring is if you look at most systems today, they have the classical things, pressure, they measure the pressure, they measure the flow rate, temperature, et cetera. Classical ultraviolet technology has a drawback. The drawback is when the protein concentration reaches around 20 mg per mL, milligrams per milliliter, it saturates, means now you're blind, you don't see anything.
Craig's team did an incredible job coming with the technology where you can see it all the way to 250 mg/mL to 300 mg/mL. That's the SoloVPE technology. The thought here is, if I have a system where I can continuously see the concentration of the protein, I can make intelligent decision or the system, the programmable logic controller, and it keep seeing it and make decision. Those decision yields in smarter system with higher yields. That's the beginning of a journey.
I mean, the vision is really in the future, all those systems, not sensing only concentration, but looking at the impurity levels and other what's called critical quality attributes of the therapeutic, so that you can, just from manufacturing without taking the pain of measuring, it takes months to measure all those different features to be able to see. That's the vision for the future. I'll give some example on process intensification. This is the team at Bristol Myers Squibb. I talked about the bioreactor. The cells grow, they keep making the antibody there. That bioreactor is called a production bioreactor. The way it works is you have to inoculate with a certain seed, and they start to grow. To feed that bioreactor, you need the seed.
There is a series of bioreactors from very small size to larger to be able to seed it. The thought in what we call N-minus-one is if you take the last seed reactor, that's why N-minus-one, if you really increase the cell density, now can you shorten the duration of production bioreactor? That's better use of capital equipment. Can you also have higher, say, antibody titers here? As you see here, the graph that they published shows how with N-minus-one, higher cell concentration, then they take that, they inoculate the production reactor, higher cell concentration, much more protein concentration in the reactor intensification. You're making much more within the production reactor in a shorter amount of time.
Similar works at other users where they had a press release from Samsung in which using the ATF product in N-1, reducing the production time, better utilization of the facility, increasing the cell concentration, itself keeps making the product, and cell viability, those cells have to be alive to make the product. Another example is TFDF. We keep pushing these technologies to offer better, more efficient solution. TFDF, this is really good work after the invention of TFDF. In single-use facilities, most users use depth filters. This is a bank of depth filters here to remove the cells and cell debris from the antibody. If they put a TFDF unit this big, it does more or less the same job as those depth filters. This was worked together. Again, it's the relationship.
The team at Genentech, they gave a great talk together with us in Bioprocess Week a few years later. What we're focusing on now, keep pushing the boundaries further. Another example is viral vectors, lentivirus. Lentivirus, as many of you may know, with a lot of those viral vectors, they have to produce more. What they make in one bioreactor is not enough, say, for the indication and so on. This is a collaboration with Oxford Biomedica in the United Kingdom.
In this case, instead of using a depth filter to separate the cells from the lentivirus. What they use, the TFF technology, and not only it enabled them to do two different harvests, increasing the, we call it titer, the lentivirus, the amount of lentivirus that they harvest is 80%, but it also lends itself to perfusion where you keep feeding the bioreactor with new nutrients. You get rid of the bad spent metabolites, urea and all the other stuff. The cells are happier, more lentivirus is made, and we demonstrated that both in our labs. I'll talk about our Gene and Cell Therapy Center in Waltham. We have really nice results there. Christine had also mentioned academic collaboration with McGill and so on. I'll talk about.
I talked about FlowVPX, the concept of using it to continuously say, "Hey, what's the protein concentration? Why is it important?" This is the final operation process. They have to bring the therapeutic to the target concentration, and they are put into a buffer environment so that the protein or virus is stable, it has a shelf life, and it can be injected. By using FlowVPX, they keep monitoring instead of using scales and doing how much volume mass do I have left. Instead of as they finish concentrating it to this TFF operation and running to the lab, taking a sample, and the feed is sitting there on its own, coming back as the right concentration, they're doing it through this, what will give them yield benefits, speed benefits, and so on.
You will see a video. This is the FlowVPX. This is a pump that pushes it through a tangential flow filtration system. This is where the filtrate is connected. Here, the experiments we did was concentrated to 38 g/L protein concentration, then keep washing, it's called diafiltration, keep adding new buffer and removing it, so it's a new buffer, concentrated again to 150 mg/mL. This is the user interface. The user just puts, the concentration targets and number of the filtration volumes they have. It has to be intuitive, easy to use, and easy. Here is the feed pumping it, and FlowVPX, it's continuously, I call five seconds continuously, keeps saying, "What is the protein concentration?" Then it keeps giving this information, to the user.
Oh, we stopped the concentration at 38. Now we're gonna keep doing buffer exchange, and then going into the second concentration step, and then we can stop the operation. A curve is generated so that the process engineer in the manufacturing floor can see what has happened. Basically, this is very accurate. You don't have to go to the lab. It reduces cycle times. I talked about our Gene and Cell Therapy Center. We have scientists working there. We make our own adeno-associated virus, lentivirus, come up with new methods. Again, it's a community with the users where we present. In this particular one, we're talking about the benefits of perfusion, how it increases the viral titers.
Another one is rapid process development, how by using RoboColumns and so on, you can do it much, much faster, again, go to the clinic faster. We collaborate with various of our friends in the industry, with academic centers, and then we publish or we present in scientific conferences. To conclude, I think we have come a long way. If you remember four or five years ago, we had filters, we had OPUS columns and so on. From where we were then, we have come to a place where we offer solutions. If you take an example, chromatography resins, we have affinity ligands packed inside the OPUS column, connected to the flow path, and then finally a smart system making decisions on when to stop harvesting.
In the future, as Tony was talking, is to say what is the quality of the protein, and hopefully one day in the future, if we can tell the glycan profiles, the different charge variants, and so on, really making our factories much, much faster. Now I'll give it to Vikas.
Hi, everyone. My name is Vikas Gupta. In the next 20 minutes or so, I'll be covering what's happening in the world of cell and gene therapies. Right? We also refer to it as new modalities. More importantly, it's about what role Repligen's products and technologies play in the manufacturing workflows for these new modalities and what problems do they address. As Tony was alluding to earlier, some of our products are a shoo-in, right? Right off the bat, whether it's flat sheet cassettes or hollow fibers. Then there are other products like the RS-20 system that Gautam referred to. With the mRNA market evolving and focus on individualized cancer therapies, we needed a GMP small-scale system. His team, you know, jumped on it and developed that system to keep pace with the market. Similarly with our Avitide affinity resins, right?
The market today is dealing with resins that only last two or three cycles for viral vector purification. We are trying to transform that market with resins that can last 15, 20, 40 cycles and offer better economics to our customers. I'll be covering all of these aspects in my presentation. The overarching theme or, you know, the trend that's evolving in the cell and gene therapy industry is that with the FDA approvals in 2017 and 2019 for Luxturna and Zolgensma for retinal dystrophy and SMA, the patient populations were very small and the doses required was very small. With those successes, and even with some of the CAR-T applications which were autologous in nature, again, the need for the therapeutic itself was small.
Now the focus is shifting to larger disease indications, larger patient population indications like melanoma, right, thalassemia, and even cancer. The need for more viral vector demand is going up tremendously. Another thing that's happening is Imlygic that was approved for Amgen by FDA. It started with its focus on melanoma, but they're also trying the same therapeutic for breast cancer, for pancreatic cancer. My point is, the need for viral vector, you know, as a raw material, as a core raw material is gonna go up. The cell culture volume that is existing in the market is not enough. The batch mode of you know making viral vector is not gonna suffice, and we need to move to a continuous process or a perfusion-based system.
With the success that, you know, we have had in the last five years, it's no surprise that we have more than 3,600, you know, these therapies in the clinical development pipeline, almost 60% in gene therapies, and then the rest is equally split between RNA and cell therapies. Repligen mix is also pretty healthy, 70% in the viral vector space for gene therapies and 16% in RNA and another 13% in some of the newer modalities like exosomes, cell therapy, and oligonucleotides. Within the viral vector space, 60% of our revenue comes from AAV and 35% from lentivirus and the remainder from adenovirus. This is very reflective.
If you look at all the clinical trials going on right now and see the split, this revenue is very predictive of, you know, that split within the clinical trial space. The key point here is that all of our products on the upstream side, you know, whether it's hollow fibers or ATF or TFDF, and then on the downstream side, again, with our cassettes and TFF and chrom systems, within the viral vector workflow, for the most part, we are viral vector agnostic. They do really, really well in all of these workflows. Maybe, you know, some of the things like a hollow fiber would be much more suitable for a lentivirus versus a cassette, which is much more suitable for an AAV.
Given you know the adoption of our technologies, it's no surprise that we have had significant growth in the adoption of our technologies in the cell and gene therapy space. We have seen a 35% CAGR, which is about 10 percentage points above the market growth. This year we expect to finish 40% higher versus last year. More interestingly, when we started focusing on this space like much more diligently in 2019, we had about 150 cell and gene therapy customers that we were servicing, and we have grown that base to you know 300+ accounts now. 100 of those accounts are contributing upwards of $100,000 in sales to us on a yearly basis.
If you look at the revenue, I mean, the customer segment split, it's also very healthy. It's you know, 49% from CDMOs and 46% from developers. Another 5% comes from academia, so these are usually viral vector core labs like UPenn or Nationwide or Johns Hopkins. From a geographical split perspective, 70% of our sales is coming from North America, which is expected with a lot of startups and the technology innovation in this space happening here in North America. The rest come from Europe and Asia. The main reason behind this success is you know, again, going back to a couple of points that were made, that Repligen has never focused on developing me-toos just because we wanted to fill out our portfolio.
We are developing well-differentiated products that are addressing very specific pain points, you know, that our customers are grappling with. One of the things that we talked about, you know, in my first opening slide, the need for more viral vector, you know, the need for more plasmids. The current batch-based process is not meeting those requirements. Customers are still at times dealing with adherent cell culture. They have not even migrated to suspension cell-based processes. There is a lot of room for optimization on the downstream side, right? The chromatography step and the TFF step, they are only yielding 30% product yields. Customers are coming to us on a daily basis saying, you know, "Can your field application experts help us improve the product recovery, the product yields?" On the analytics side, right?
Again, the need for plasmid concentration measurements, for viral vector concentration measurements across the entire workflow, you know, we'll talk more about that solution as well. The impact you see is that on the upstream side, we have seen our products give as much as 3x improvement in productivity, in some cases much, much higher than that. On the downstream side, 2x increase in downstream yields. And of course, you know, with our SoloVPE, FlowVPX technology, we have options for both at-line and in-line, plasmid and viral vector concentration measurements. If you focus on the upstream, I know that both Christine and Ralf touched upon TFF, TFDF.
I would say that, you know what ATF did for mAbs ten years ago, so TFF is in its early stages to bring about the same change, same paradigm change in the world of viral vectors. It's forcing our customers to move from batch-based processing to perfusion-based processing and enabling upstream process intensification. Even beyond that, it is also working as a primary clarification device, right? The main focus is on upstream process intensification, but again, the same device will eliminate the need to buy another clarification device from a competitor. It's meeting both of those needs. You can see a couple of data points that we have received from our collaborators.
On the AAV side, we work with iBET, and not only did it enable the growth of the host cells, you know, that are used to make the viral vectors or grow the viral vectors, but even the viral genome per cell, you know, that number also increases. You saw a threefold increase in the amount of AAV that could be produced with a perfusion-based process using TFDF. McGill again, you know, we have talked about it multiple times now, so 30x increase in the amount of lentivirus that could be produced with TFDF. Absolutely transformational. TFDF is being used both in the N-1 as well as the production bioreactor, the main bioreactor as well. On the downstream side, we have a plethora of solutions that help, you know, optimizing our downstream yield, starting with OPUS PD.
These are our process development columns. Resin screening, right? What are the best resins to use? What are the best process conditions to run the chromatography unit operation? Our flat sheet cassettes and hollow fibers are fully assembled with single-use flow paths that Jim was alluding to. They virtually reduce or eliminate the risk of contamination. Chromatography systems that Gautam talked about, you know, they are gentle mixing, maximizing the product recovery. The flow paths are designed such that there is virtually no hold-up volume. Every milliliter, every drop of the product is recoverable. AVIPure AAV resins that we launched back in February, again, game-changing, right? These are caustic stable resins, unmatched in the industry.
We are sharing our vision with the customers that even though they might be okay with using our competitor resins today, which will only last three or four cycles, as they scale up these processes, they will need to use these resins multiple times to save cost. If we show them that vision of what's happening three years or five years from now, so they are in the early stages of evaluating these resins, and we are getting excellent feedback there as well. Beyond product, I think another thing that's extremely important that because the customers are so risk-averse, they're also asking us to show application data, some proof points that our products work.
From that standpoint, we have tried our level best with Ralf's cell and gene therapy team, our field application scientists, that we always stay at the forefront of the emerging trends in the market. What I mean by that is, as the market is growing from adherent, you know, cell culture to suspension cell culture, we talked about multiple harvests, you know, where Oxford had a 2.5x increase. We have moved and collected data on perfusion-based processes with transient transfection, but the McGill data was on a producer cell line. Very few customers, very early-stage customers are moving from, you know, transient transfected cell lines to producer cell lines.
We are trying to stay ahead of the competition and keeping up with the emerging trends in the market to make sure that we can provide that data to our customers. mRNA, I mean, what to say about it, right? With the success of the COVID vaccines, it's no surprise that there's a tremendous amount of focus on this platform technology. It's being used, you know, to develop vaccines and therapies for infectious diseases like tuberculosis, HIV, flu, and then, you know, for cancer therapies as well. You can see, you know, again, the clinical pipeline is very well diversified and upwards of 140 clinical trials in the pipeline right now.
As Tony said, the good news is that we have worked with a lot of these customers which have almost 50% of their clinical trial programs non-COVID. We have had a very close relationship with them through the development of the COVID vaccines. We continue to nurture these relationships as well as partner with new and upcoming manufacturers that are working on mRNA-based therapies. This is these days my favorite workflow to focus on. As you can see that before we get on the mRNA side, plasmid still remains a critical raw material to actually make the mRNA. All our products, whether it's our KrosFlo hollow fibers that help with the cell harvest to the ARTeSYN skids for plasmid DNA purification with our OPUS columns, and then the concentration measurements.
Again, SoloVPE and FlowVPX are the main workhorse in the industry for plasmid concentration measurements all along the process. Once the plasmids are used as a DNA template for, you know, they go through the linearization process, and the next three steps all the way from production, you know, IVT step to the capping, it entails both chromatography and TFF every step of the way. The critical design of our flow paths for our TFF and chromatography systems, the automation, the fact that this smaller system that we have launched is GMP system, you know, focusing on individualized cancer therapies. We clearly stand out versus some of the more generic technologies and systems in the market.
I would say that, again, with our very, very strong focus on listening to our customers, addressing specific pain points, the fact that all of these systems and flow paths are completely integrated, single-use enabled, and we are keeping up with all the new modalities, you know, that are gaining traction in the market, I think we are well-positioned to do well in this space. That's it. Thank you.
Thanks, Vikas. We're gonna take a 10-minute break. Be back here by about 10:50 A.M. to get the Q&A panel set up. Thanks.
Okay, we're gonna get Q&A started. We have all of our panelists here. Let's see if Danielle. Why don't you take this mic?
I heard that Kola was using the mic.
There's more things you hear close. There's more things you hear than that.
Yes. Is this on? Okay.
Yeah, you look good. It is.
We'll get you out a little bit early. I think we'll have half an hour of Q&A here. Sondra on this side and Danielle on the other. I say just raise your hand, and we'll start from there. Dan. Oh, for the webcast, please state your name and your firm.
Hi, Dan Arias from Stifel. Thanks very much for a helpful presentation, guys. Wanted to ask about the 65% of revenues coming from clinical trial work. Is there any way you can sort of talk to the way in which the revenue capture changes as you progress through the clinical stages? I'm sure it varies by product and by indication.
Loosely speaking, is there a way to think about phase one going to phase two to three? Just because we do get that question a lot, and there is so much in the cell and gene pipeline sitting in phase one and presumably moving to two and three over the next couple of years. Can you help us with how we think about the revenue trajectory as you kind of graduate to the later stages?
Yeah. I think the best example of that, Dan, is the chart that Christine showed. It wasn't a chart. It was a table where on ATF, 50% of our revenue in ATF is coming from Phase III and commercial. So that's like seven years. You think about ATF as a product line, it's like seven, eight years in. I think when you're less mature than an ATF product line, then you're gonna see a lot more. And I know the question you're asking, it's really hard to give an exact answer to it. The trick or the opportunity and the goal is get to Phase III, because once you're in Phase III, you're essentially locked in.
In the mAb world, you know, there's the attrition rate, phase 3 into commercialization is much better than what it was, say, 10 years ago. I think ATF is a great example where 50% of it is coming from Phase III and commercial. I think a lot of our products are still early in their life cycle, like TFDF is really early in their life cycle. Even our hollow fiber portfolio, to be honest with you, as we, you know, inherited that portfolio from Spectrum, almost all the revenue for Spectrum was like preclinical Phase I, maybe some Phase II. That's maturing.
I mean, I think the product lines are probably gaining 5% to moving 5% plus every year, as we continue to move from phase one to phase two to phase three. I don't think it's a 10% shift. I'd say it's more like a 5% shift.
I think on manufacturing runs, you might do maybe five runs in a Phase I at a very small scale. Maybe you'll do 10 to 15 runs in a Phase II and maybe 25 plus or something like that in a Phase III. Not only are you scaling up the size of the equipment and consumables, but you're getting that many more runs per cycle. Does that make sense, Tony?
I would say, Christine.
For clinical.
Yep.
No, absolutely. Yeah. If you think about the spend maybe for a development situation where the customer might be $100,000 into equipment plus consumables to do development for a process. Then as you scale, right, the large scale equipment is $200,000-$250,000. Then to Jon's point, you're running consumables on a more routine basis, right? Maybe a five-fold expansion of the spend associated with single process moving from development to, you know, through larger scales of manufacture.
Phase three would potentially be multi-million dollars.
Absolutely.
The five-fold expansion of the spend is, for instance, going from one to two. Is that right?
Yep.
Yeah.
It's hard then to take N and convert that into some revenue model.
Yeah.
I think it's just the attrition rate that makes it hard. When you get a win in Phase II in 2022, it doesn't repeat again until it makes it through phase two and gets into a Phase III, which would be 2024. While no one's really following every single molecule, it's back to the conversation we had recently, which is platforming. If you're at an account and you're platformed, it doesn't really matter. I mean, you like to see every molecule move through the pipeline, but because there's always something coming in to replace it, you still see the trajectory of growth at the account.
We have a question on this side of the room. Please state your name and firm you're with.
Thanks so much for the presentation today. Super helpful. Liza Garcia, UBS. I appreciate that there are many moving parts, but the update to the $2 billion for 2027, 2028, how do we think about cell and gene therapy growth and those accounts within that $2 billion?
Yeah. I would say cell and gene therapy growth, it's, you know, it's going to average probably somewhere in the 25%-35%, as we go through the next five, six years. It's going to be north of 25% for sure. Obviously, you know, a year ago, we were talking about looking to see more approvals, right, in cell and gene therapy. I think this year has been a better year than last year on the cell and gene therapy side. If we continue to see progress and approvals, then you know, you could be at the high end of that range. It just depends on how the market evolves. You know, this is definitely a better year for cell and gene therapy for those companies that are, you know, moving from Phase II to Phase III and into commercial.
That's where we would look at it, how we would look at it.
Great. Thank you.
Um,
Puneet Souda, SVB Securities. Thanks again for the presentation. Really, different investor day than the 2017 one. Really great to see the progress. But, you know, just a sort of a longer term question and more near term. Maybe if I could ask the more near term given, you know, all the COVID dynamic. Obviously, COVID is, you know, declining. I think everybody knows that in the room. You have capacity expansion. Capacity expansion is happening across the industry. And obviously, you showed the slide where you have expanded capacity. Lead times are changing, as Tony pointed out. You know, Tony, if you could just look at all that dynamic and just maybe help us understand. I know 2023 is just right around the corner.
What can you tell us, even if qualitatively, how should we think about all these dynamics playing out, you know, in this near term despite the 2027 and 2028 $2 billion number that you put out?
Yeah. I mean, first half of the year for us this year, obviously you can see the revenue number. We know the orders are really strong. We know that COVID is declining, right? The numbers we put out back in end of July for next year is not really based on having firm forecasts from the big customers that we have in COVID. We don't expect much more than, you know, $50 million. It could be less than that when we get to the end of the year, and we finally get to see what some of the forecasts and orders get placed, then we'll have a better idea of COVID.
I think if I were in your shoes, I would really be looking at COVID and just essentially discount it down. If we have a $50 million COVID business next year, fantastic. If we have a $30 million COVID business next year, that's fine, right? We're focused on our base business. We're focused on how do we expand what Gautam spoke about today, which is the whole systems portfolio. How do we take fluid management and integrate fluid management into everything that we do? Every time a salesperson sells a system, they should be selling the flow kits that go with it. How do we continue to win in upstream? That's what we're doing. I mean, we should be able to grow our base business, right? That 20%+ rate, and COVID is COVID.
I just don't view it as a really significant factor anymore for any of the bioprocessing players. I think that's the message you're hearing from everyone in bioprocessing is it's going to reach some plateau, but it's not going to be a meaningful number, right, that moves the needle for most of the companies in 2023.
Okay. Thanks for that. Just follow up on. I mean, you've been excited about PAT for a long time, obviously. I mean, now with FlowVPE, FlowVPX technology, now Daylight, sort of help us understand, you know, where can Daylight be positioned across the portfolio. You obviously have a 15-year agreement here. Maybe if you could talk about a little bit about what the economics of that agreement and how broad this mid-IR technology can be used with the UV capabilities that you have with FlowVPX, and how do you think this will sort of, you know, reshape the market and maybe at what point do we get to process control, which I think was alluded to on one of the slides.
Yep. I'll start and hand it over to Craig. Oh, Craig's my left, he moved, or I moved. Yeah, no, look, a Daylight deal, we're right at the beginning, right? It's less than 24 hours old, and I think we're really excited about it. We think that it has tons of potential. When I think about the applications, we're at the tip of the iceberg. We definitely see opportunities in nucleic acid. We see opportunities in protein aggregation. We see opportunities in drug stability. You know, based on, you know, different formulations that people put drugs in and how stable are those formulations, they can measure it using this technology. For me, it's all about applications.
We just need to spend the next 12 months really working through what the two or three killer applications are, make sure we're opening the right doors, working with the right customers, making sure we're doing the evaluations. If I went out a couple of years from now, it should be getting integrated into the systems Gautam spoke about. Can we, can we use that combination of flow and mid-IR to just totally differentiate what we do in the marketplace? Maybe, Craig, do you wanna add to that?
Yeah. I mean, I think the market is in the earlier stages in terms of control, monitoring for sure. We already have customers that are right on the verge of using it for control. The industry's ready. Taking other sort of technologies and going along with the customers we've already worked on is just natural. The integration within the rest of the product line makes total sense. Having a solution rather than components that have to be put together by our customers, they've been asking that for a while, and that's where we're at.
Matt Larew, William Blair. Tony, you referenced platform wins and gave some data points there, and then Ralf, you referenced the transition from unit solutions to integrated solutions. Just curious, Tony, if you can maybe provide some historical context on the individual product or unit sales relative to a platform or system win maybe five years ago versus today, where that might be in five years. Just curious, an account or a customer that would be a platform sale or one purchasing an integrated system, maybe the size of that kind of customer account relative to one who might traditionally have purchased a point solution from you.
I'll start. I'll ask Christine to comment on maybe some of the products in her portfolio, just to give you a general sense, and maybe Gautam as well. In general, if you're getting a platform PO, it's $ multi-million, right? We're talking about kind of in that probably $2 million-$5 million range, if someone's using your technology and is implementing it broadly across multiple sites. That's every few years you're getting. It wouldn't be every year you would get a $5 million PO, but every two years you're getting that. Then you get the consumable, right, on what you sell into that initial sale. If you're not platformed, you might get a $1 million PO for product, and it might be for a site. It's. There's two types of platforming.
There's platforming at a site, and there's platforming at an account. Platforming at a site gives you know, first dibs at any process that comes through. Once you're doing that, you wanna actually further develop that and make sure that you're at all the sites. If we now look at the big pharma companies, the sites operate somewhat independently of each other. It's not like, you know, just because someone places an order for $3 million-$4 million for a product at one site that there's now four more POs coming in, because it just depends on what those other sites are teeing up to do in the course of a year. If they're gonna do production runs and you're platformed, you're getting the POs.
I'm not sure if Christine or Gautam want to add to that in terms of kind of size and scale versus not being platformed.
Yeah. Maybe only two points to add. In terms of if I think about platforming at the beginning of process development, right, where technology is evaluated, right? A company will decide that, for instance, XCell ATF or KrosFlo TFF is their technology platform of choice, right? Now all new biologics that come through that development lab will be developed with those technologies, right? It provides the flywheel as well to future processes that are scaling through clinical development and looking to get to commercial to be moving through with our technologies. Think of just another example is maybe on the filtration side, right? If we have a recombinant protein manufacturer or mRNA manufacturer, they're also deciding that on a filtration, on downstream filtration platform, right?
They may choose, okay, I'm on a hollow fiber platform or a flat sheet platform, and even more specifically down to the molecular weight cutoff of that type of membrane that will be utilized. That we know that once we're platformed, that development laboratory isn't going to evaluate technologies from other suppliers because they're platformed on our technology.
Gautam, anything to add there?
Yeah. Maybe just to kind of give a frame of reference. If you know, you saw on Vikas' slides, the very small systems that are there, and then you have, of course, systems going up right to the one-inch size. The range varies from anything between, you know, say $50,000 to going up to three-quarters of a million dollars. As the customer progresses, you see that spend. The other variable here is if customers like you saw on the slide, you know, they have the same TFF operation multiple times.
In the past, people would say, "Okay, I'll just wheel the skid around and use it." Now they're trying to get a lot more product out, so they're saying, "I'm just gonna invest in multiple systems that will hook into that process." That changes the dynamics of the consumable tremendously.
Maybe one other example, I think Jim can speak to it. When you think about fluid management, there's opportunities to be platformed, and that is really does go across multiple sites.
Yeah. No. That's a great point. On the fluid management side, generally what a customer will do is platform in the contact surface. So if it's tubing or silicone or whatever it may be, once that has been characterized, the account is confident to use that across multiple product categories. So they'll platform in the, even the component set.
It'll be multiple sites as well.
Absolutely. Yep.
Good morning. Jacob Johnson from Stephens. Two follow-up questions. One on Matt's platforming question. You know, as it relates to the cell and gene therapy space, where there's a lot of best practices being developed and a lot of learnings going on, is that an area where you can see more platforming maybe than a traditional mAb?
Yeah.
The second question, appreciate the $2 billion by 2027, 2028. You're bringing a lot of capacity to support that growth. John, maybe for you, these capacity additions are kinda weighing on margins right now. How should we think about the margin progression as we think about the path to $2 billion of revenue?
Maybe we'll start with the cell and gene therapy. Maybe Gautam, do you wanna speak to, you know, where some of the potential is in our portfolio for platforming and how that might evolve?
Sure. I think, you know, again, probably the greatest potential in that area is still around oncology, right? Like Vikas said in his presentation, before it used to be very much about, you know, more of the orphan drugs, more of the specialized treatments, looking at tens, maybe, tops 100 patients. As soon as you start to venture into the more classical oncology types of treatments, you know, you're talking about hundreds of thousands of patients. I think that changes the game in terms of the platform. If you can get into one of those drugs with any unit operation, then it's very likely that the customer will stay with you as they scale. I think that's the greatest opportunity that we see there.
From a technology point of view, would you say kind of TFDF has a lot of potential to be a platform technology?
Yeah. I think TFDF is doing really well. I think we showed some data around antiviral applications. This is an industry which is really even though they've been around for quite a while, it's becoming mature now. The time is now, and people are actually taking processes greater than 200 L, which was usually the max point. TFDF because of its closed nature is very valuable compared to, say, traditional depth filtration equipment from other providers, which tends to be much more open and you have risk of contamination. Very popular there as well as the yield.
Great. Jon, do you wanna chat maybe through how we see capacity?
Yeah.
Evolving between physical capacity and people and the impact might have on margins?
Yeah, start off with a disclaimer. This is not guidance for 2023, Jacob. You know, we've talked about the capacity. We've been building out and looking at capacity over a three-five-year time horizon. Yes, largely getting through the timeframe up to $2 billion. Maybe there will be CapEx adds and CapEx upgrades and things of that nature. You know, going through next year, we'll have spent a big chunk of that in our three-year capacity plan. That's great news. The flip side of that is how does that impact margins? As you guys know, with the guidance that we came out in our last earnings call, we indicated guidance of 57.5%-58.5% adjusted gross margin for the year.
Certainly that would imply that margin could drop a couple of basis points in the second half of the year compared to the first half of the year. Contributors there are, you know, we've been burning off inventories in the first half of the year that we acquired at last year's prices, right? There's been inflation. That's gonna start playing in on top of the fact that we're going to have to start depreciating some of these large scale projects that we've put in place. That's where you start to see the fixed cost component coming in on that second piece impacting the margins. The piece that we always say we can control is the variable component of that.
That's the direct labor and the supporting labor that you put in for that capacity. You know, we will have some idle capacity this year, next year, and we'll start eating into that over time. We can control the headcount component of that and control the variable cost side, and we'll continue to do that over time. Only staffing those lines and whatnot when the volume comes in.
Jeff Gaber, 12 West Capital. Thank you all for the presentations today. Just curious to hear on the visibility side, how the target for $2 billion you shared today for 2027 or 2028 compares to the $1 billion target that you shared, I think in 2020. I think originally it was a five-year target. Just kinda comparing the portfolio you had then and the visibility associated with it for that to the one that you have today, looking forward.
Yeah. Look, I'm when I look at our trajectory as a company, obviously the portfolio has changed even fairly dramatically since 2020. I mean, if you went back to beginning of 2020, I think Gautam's presentation on systems would have been very different. I think there was no fluid management component in our portfolio. And just like what we talked about, even Craig's business was just beginning to. I was reading six months in, and we were, what, $25 million-$30 million business. Contribution from analytics was actually relatively small. I think the. You know, when you look at the CAGR that's required to get to some of these numbers. I think we've got great technology. I think we have the right products in the marketplace. I think we're differentiated versus the competition.
The two things that have to happen between now and 2024 to hit $1 billion, and now and 2027 or 2028 to hit $2 billion is execution and markets stay healthy, right? Can't change, you know, if the markets happen to go down, you can, you know, we can execute in healthy markets, right? So far, the markets have been really healthy, right? Even though the, you know, we're coming off COVID, there's still a lot of activity in labs. You see the activity going on in biosimilars. You know, I think the storyline in cell and gene therapy is getting better as we go through the year. You look at historically, what has Repligen grown at, you know, we've grown, you know, over 30% over the last 5+ years.
For us to get to, you know, $2 billion in 2027, 2028, if you wanna get to 2028, it's 16%-17%. If it's 2027, it's 20%. We're in that range, and I think that's very achievable. I think we've shown that we can grow at that rate. I don't see anything on a long-term horizon perspective that would change my mind that we can't grow in that range or higher than that.
Thanks. Julia Qin from JP Morgan. We appreciate that a lot of your new products are positioned to drive an industry technology upgrade to process intensification and ultimately continuous manufacturing. You had a slide showing that it might take the industry three-10 years to get to continuous, fully continuous manufacturing. Obviously, that's a very wide range. Just curious, what do you think are the major swing factors that could affect that pace of progression? Which end of that spectrum is embedded in your long-term guidance of $2 billion? Thanks.
I'll start, and I'll ask Christine and Gautam to comment on it. The only piece that I would highlight on that is everybody is working on semi-continuous and continuous, but they're working at it at a process development scale, right? They're really early in their thinking of how they would implement it. There are a handful of companies that have implemented continuous manufacturing for drug production, but it's a handful. I would say if I looked at all our customers and you ask a question, what's top of mind? Process intensification is top of mind, and it's process intensification upstream and process intensification downstream.
Until people feel like they have, you know, really licked that issue and that they have best-in-class technologies that really improve the efficiency of their manufacturing process, they're gonna wait a little bit before they jump into full continuous. I think you'll see semi-continuous. I think right now it's all about how do you intensify your process. That's, you know, that concept's been around for a while, but I would say over the last two years, it's really accelerated, and it's particularly true. Maybe when Christine answers, she will focus on mAbs, and then Gautam and Vikas can kind of speak a little bit to the importance of process intensification in the cell and gene therapy space, which really needs it. Maybe Christine and then Gautam and Vikas.
Sure thing. The only thing I would add is that to Tony's point, there are customers who are producing commercial therapeutics today with semi-continuous bioprocessing, right? What I'm seeing, and I think I mentioned this in my presentation, that ATF is really the cornerstone of continuous, right? We have visibility to the customers that are looking to connect more than one unit operation, right? What I'm seeing is a balance between the time to invest in the process development to do that type of development versus the time to truly do, you know, development for a given biomolecule, right? I would say it's the larger biotherapeutic companies that have that balance of, and the resourcing to, you know, to allocate some time to the continuous or semi-continuous product development.
It's only coming.
So-
Before Gautam jumps in, I would say, you know, COVID hits, I think there was no process development optimization going on. It was like, you know, how do we, how do we just keep the manufacturing sites running? It's really in the last 12 months that the energy level is back in terms of doing PD work and looking at, you know, everything from process intensification to semi-continuous. We definitely had a period of time where, like, we would look at new technologies, I think TFDF was a great example. Our ability to get in and do trials in second half of 2020, first half of 2021 was pretty poor, right? Just customers weren't allowing anyone to come in. It had to be critical path.
I think that's changed here in 2022, and I think, you know, process intensification, mAbs and gene therapy is where people are. Maybe Gautam, Vikas, you guys wanna-
Yeah.
Yeah. Maybe just to add another bit of flavor to Tony's earlier comment about continuous versus semi versus, you know, unit process intensification. When you think about cell and gene therapies, there are. It's all very new still, right? Companies are trying to grapple with how do they scale the process, how do they get more drug output. The last thing you want to do is to introduce another variable that you don't fully understand. I think they're looking at process intensification with the lens of, let me get each unit operation right and maximize how much output I get from that before I think about connecting the dots. I think the other piece that's there is around automation. All of these pieces or systems have to be able to talk to one another.
They're not all talking the same language at the moment. I think companies that can kind of bring that together for clients will be very successful in this area.
Great. Thanks.
The only thing I would add is that when you look at these, you know, startup cell and gene therapy developers, they are still having their processes at small scale, you know, because of financial limitations and what have you. The batch-based processes are resulting in very low yields, very low, you know, product titers, both. Process intensification with TFDF, right, or process intensification on the downstream side, it enables them to maximize the output given their current infrastructure. They're absolutely hungry for those kind of technologies to be adopted in their workflows.
Great. Appreciate the color. My second question is regarding PAT. You highlighted the opportunity to integrate analytics with systems to create intelligent systems. I was wondering if we can elaborate on the differentiation. What are you seeing your competitors doing? How meaningful a differentiation of that integration will be? And then over what timeframe will we see that kind of, you know, smart system get validated and, so it can be adopted more broadly? Thanks.
I'll start, and I'll hand it over to Craig. I would say that from a competitive point of view, everybody is dabbling in PAT, but we're differentiating what I would call general process analytics technology, where you're using. As I said in my presentation, you're looking at conductivity, pressure, pH. You're looking at capacitance versus what we're doing, which is advanced analytics. Customers really wanna follow their drug. They wanna know when is the drug glycosylated? When is the drug aggregated? What's the concentration of the drug? That's what we mean by advanced analytics. I don't believe there's anyone else in our industry that's as focused on solving those problems as we are. And that's just because we don't know what all the other peers are doing, right?
They're not sending us emails saying, "Here, we're working on this system." I can assure you that we're working on it. Maybe Craig, do you wanna chat through a bit with Gautam as well about the timing of.
Mm-hmm.
You know, integrated UV versus what we think may be the timeline on the integrated Mid-IR?
Sure. I think if you just take a step back for a second, you have to understand that the journey is sort of offline measurements, and we've been using our offline measurement with the customers for probably about 10 years. It's taken them a while to understand, okay, everything works offline. Let's no longer take things to the quality department. Let's measure inline. It's a big ask, and that is happening. I don't know any other techniques that are as widespread as ours. People are using other techniques, such as Raman or refractive index, but not a situation where they're thinking about, "How do we integrate it with the rest of the systems?" That's the first thing. We're being pulled by our customers to actually integrate. They want it.
Our customers are already doing that with a variety of different type of systems, but they want really sort of a turnkey solution based upon a lot of the comments that are being made in terms of software, how do you interconnect everything with the rest of the processes that are happening. Right now, we already showed something that shows a complete system. I think we're showing at a conference next week, so sort of an initial launch on that. We're working with regard to other systems already integrating a UV type of system. You have to understand, UV sensors have been around for a while, but they have a very limited range, and nobody's really making decisions off of that in terms of control. Do you want, you wanna add to that or?
I think the question around timelines, right?
Yeah.
As Craig rightly put it, the first step for many companies is I wanna be able to evaluate the technology, right? We already have that with the video that Ralf showed, which where the two pieces are integrated already. The next step is, you know, can you put it into a larger skid but keep the two systems separate? We've also done that part as well with multiple customers. We know conceptually that works, and we can kind of make the technology work for the application. Really, the step three of that is how do you make it fully integrated so that the software is completely intuitive and it's one software that drives everything, and you make the system completely. The recipe profile on the system has to match that.
That's what we're working on. I think there's enough demand from the industry that we see this as a more of a 1-2-year cycle versus, you know, multiple years. I don't think people are willing to wait that long.
The journey with Daylight is going to be pretty similar, right? It's going to be at-line, in-line, and as the applications evolve, customers will naturally migrate towards, "I want real-time results on my manufacturing floor." To get there, you have to have everything that Craig's done already with Flo, which is you have to have GMP software. You have to have disposable Flo cells, and you have to have a very simple. It has to be easy to use, right? You can't give a convoluted solution and pop it on the manufacturing floor. It has to be simple to use. We believe that's the journey we're on. We're excited about it. We think it's gonna be another differentiator for Repligen.
Hi, it's Carl Brown from Axiom. You had some estimates of market share in the presentation. I think it was 9% for filtration and maybe 6% for affinity chromatography. What do you think those market shares might be if you were just to focus on the earlier preclinical part of the market or actually preclinical through phase two? Just best guess. I'm sure it's nearly impossible to measure, but be interested in what your thoughts would be along those lines.
I know it sounds flippant but smaller. To Christine's point, when you're in a preclinical Phase I, even in a Phase II, the volumes the customer use are relatively small, right? When you start going into Phase III and commercial, your volumes go up.
I know it's smaller. I'm talking about share-
No, I know.
In those markets.
The % share is gonna. Maybe I'm missing the question, but I would say the percent share is based on then, our revenue for that, what percent of the total addressable market are we gonna get? It's going to be at least half, if not more than half of the percent that we showed.
Maybe I've misinterpreted the question, but I think that's the way I would look at it.
I would have presumed that you had a higher market share in your markets on the earlier stage stuff because you're.
Oh, when you're talking about.
You're less mature in terms of what you've been building over the years.
You're talking about market share within the segment as the total versus the total market. Yeah, I would say that, you know, our story about how we've evolved as a company has been that we've been in the preclinical Phase I, Phase IIs. That's why we have 65% of our, you know, revenue coming from the clinical side versus 35% in pure commercial. That's not. We're, when I say clinical, all the way through Phase III. Yeah, we're winning because we're a younger bioprocessing company, we are winning more of the market in those early stages. Apologies, I've misinterpreted. Yeah
Okay.
We're gonna be higher.
Higher, but no actual figures or guesstimates?
I just don't know.
Okay.
Honestly.
Just a quick follow-up. What would you say is your retention rate when a therapeutic succeeds and moves from phase two to phase three?
High.
High being north of 70%, 80%?
Yeah.
High success.
I would say greater than 80%.
Yeah.
Okay, great. That's helpful. Thank you.
Yeah, thanks.
Ram Selvaraju with H.C. Wainwright & Co. I just wanted to briefly ask a couple of questions. The first is a technical one. If we think about mRNA versus more traditional genetic material, DNA plasmids, et cetera, that's clearly more labile, it's more difficult to handle. What would you say sort of maybe semi-quantitatively your edge is versus other solutions providers because of the self-contained nature of your systems within the context specifically of the mRNA market, and in particular with reference to your already existing relationships with behemoths like Moderna and BioNTech?
Ralf, do you wanna chat through what makes us differentiated in terms of the labile nature of mRNA? Maybe Gautam as well.
Twofold. One is within the total solutions, the hollow fibers as a filter is quite gentle in terms of the flow properties. The flow path, we take great lengths on designing and developing the flow paths, so there is minimum fluidic disruptions. The third one is what Gautam talked about, again, our system design, minimizing the holdup volumes. All that is again for mRNA or other more fragile entities like an adeno virus and so on. Now, in terms of do you want to comment in terms of the relationships we have already, Pfizer, Moderna, and so on, Christine?
Yeah, I think, you know, through the COVID vaccine development, we developed very, very deep technical relationships with the leading vaccine providers, right? What we accomplished together, actually, right, 'cause it was a together scenario, those technology relationships will continue to grow. One of our slides noted, you know, the number of mRNA treatments or mRNA-based treatments in development, right, in trial, and we'll continue to grow those relationships in processes beyond COVID. I think it's that simple.
Yeah, maybe to add a comment. I think you're absolutely right. The processing time in mRNA is significantly shorter. People are worried that they need to act fast, step to step. The way that that information is transferred is now becoming more and more cloud-based. You need to have a high degree of automation within the system to be able to transfer the data in and out. You need to have the right level of sensor feedback so that the system can then respond to the instructions much faster. Those two things we've incorporated into the next generation of products, and I think it will make it much easier and much quicker for companies to process the whole batch within a matter of days.
Hi, this is Edmund Tu from Morgan Stanley. Most bioprocessing customers pulled forward CapEx thanks to COVID, but this is now set to normalize come 2024. Does this create a degree of lumpiness in the hardware part of your portfolio between now and your long-term target horizon? Are there any destocking dynamics or capacity build-out decisions that we should be thinking about?
Yeah, I
Before answering that question, we'll take one more after this one, and then I think it's time to let you go back to your regular jobs.
I can start, and then Tony can add in. In terms of capital investment by our customers, I think that's what you're referring to. Yeah, it does seem like the industry is in major capacity expansion mode right now, right? I would say over the last two or three years, there have been a significant uptick in buying systems and other products as well. I think where you're gonna see the benefit of that is, as we move forward, that's going to drive a much higher consumable stream for our products. I think systems will be robust because we're simply in early days with our system strategy.
I don't know how lumpy it's going to be, but I think we're going to have a good you know off the back of this major expansion time. I think we're still going to have a good flow of systems. The thing that I'm really excited about as well is the flow path stream that's gonna come from that is gonna be meaningful. I don't know, Tony, if you want to add anything to that.
No, that's great.
Go round two on this one.
Not yet. Kola, I don't know where you came from, so I don't want you to get cheated here on, go ahead and chime in here. Maybe can you just talk a little bit about the M&A pipeline? I mean, you guys have done a nice job finding assets, not a lot of which we kinda know about before they're announced. How do you see the landscape of small to mid-size assets, when it comes to just checking the boxes that you need to check in order for it to be a good deal?
Kola, you know, can you get Mike to hold your mic for you?
He can get a microphone. No.
Thank you.
Yeah, I think in terms of kind of when you look at the funnel and what's out there, I think it's still quite healthy. I think what we're seeing though is, you know, folks are a lot of kind of hold, wait and see going on, just given the environment. On our side, we watch a lot of different aspects. I work with all of the different business unit leaders, so we have priority areas that we've scoped out and that we're looking to move on. But, you know, I think you guys all see it. If you kinda look back at the last couple of quarters, there just hasn't been that much activity. This kind of hold and wait, folks are hoping Q4 things start, you know, there's a little bit more activity there.
You know, we'll be ready to move on that. I think at least on the M&A and the inorganic side, the priority areas line up very well with the strategy that the team has laid out. We'll continue to look at those priority areas going forward, both from a modality standpoint and then just from the process workflow.
Maybe, Kola, do you wanna comment on strategic partnerships and how we view strategic partnerships in the broader M&A sense? Because both are important.
Correct. Both are definitely important. I think that's one thing that differentiates us a little bit. I think people are more apt to talk to us to be honest, relative to some of our competitors. We lead with the innovation and all of the work that Ralf and his team do. There's a lot more credibility there and we're not as scary as some of our competitors there. That's actually how, when you look at things like Daylight or how that came about, we're just that much more accessible to these guys when they were trying to enter bioprocessing. We're a small team.
It's not like I have the armies that some of our friends have, but we're very focused and kind of very strategic in where we look. I think making sure we have all of those, build those relationships and kinda give people that more that comfort area for if you're gonna partner with someone that's gonna be more focused on the innovation and really get uptake for your product or technology. I think we differentiate on that, in that regard.
I would just add in too, our balance sheet is strong, right? We've got almost $600 million of cash on the balance sheet. You know, we don't have a lot of debt, right? We have about half of that in terms of debt. You know, we've got the ability to obviously do a lot with our balance sheet and take on more financing options as we find great assets to bring back to the company and to an investor. We're well positioned there. We're ready to jump, you know, at all times.
Okay, great. Hey, look, I'd like to thank everybody for coming. I know you've taken three-plus hours out of your day. Hopefully, you got a good sense of where we're going as a company. We clearly continue to evolve, and we look forward to meeting you guys at other meetings, on non-deal roadshows. Thanks again for everybody's support. It makes a difference, guys, so appreciate it. Okay?
Thank y'all.
Thank you.
Thank you.