See? Come to New York, everyone. Oh, hi, everyone. Welcome to day two of the Wells Fargo Healthcare Conference, the afternoon. We are excited to have Repligen here. We have CEO Olivier Loeillot and CFO Jason Garland. Very excited to have both of you here. Maybe the best place is to start, I think you guys have best organic growth, at least the companies that we cover, 13% in 2Q. Maybe just start there, what's driving the strong growth for you guys, and maybe any kind of puts and takes for the quarter.
Yeah, thanks for the question, Evan. Obviously very happy about how quarter 2 played out for us. You're right, we grew 13% organic. In fact, the real number was 14%, because we lost a percent on tariff refund. Really a great quarter, which has enabled us to increase our guidance for the full year to 10.5%-13.5%, midpoint at 12% growth, which is exactly what we grew in the first half. Our growth in H1 was exactly 12%. So we felt like this is setting us up for a good year of 2026. You mentioned about performance of our franchises, particularly great performance of both analytic and protein as well, which has helped us. I think protein grew more than 50%, analytics more than 30%, so this has helped us balancing quite a bit on the lower growth we've seen on filtration.
Great performance on margin, and I'm sure you're going to have question for Jason on that later on, so I'll pass on it. What was very encouraging for us also was to see a specific rebound of a couple of market segments that we're tracking, one being emerging biotech, and the other one being new modalities. As you all know, there have been a couple of tough years on new modalities. So to see a rebounding new modality market segment for us was really a great signal. Then finally, obviously, very happy with the progress we're making on our strategy. The pending acquisition of BioLife Solutions obviously is a big milestone for us, and we're very excited about what comes around the corner here.
No, super helpful. Maybe going to that point, 12% is the midpoint of the guide. You have a couple of discrete headwinds this year. I mean, I kind of calculate it to be about 400 basis points, which really gets you to about 16% underlying. Is that a decent way to think about how the business is performing at a fundamental basis? I know you're not going to talk about 2027, but unless you have some of these one-timers again, is that where the industry is kind of at right now?
Listen, you are right. We have been piling two headwinds this year. One that we knew already a year ago, which was the gene therapy program that has costed us about 2 points of growth in 2026. Then the other one, which was totally unexpected, that took place beginning of this year, which we informed Wall Street about, which is couple of ATF customer, one having management of its inventories this year, the other one having a delay of implementation of its manufacturing site. This has indeed added a bit of unexpected pressure to our 2026 numbers.
We are so glad that we are still managing to deliver the growth we do because it is a testimony indeed we have that very broad portfolio of products that we have been talking about constantly over the last several years. So you are also right, Evan, I am not talking about 2027 today. You know what we have been always saying, we are aiming to outpace market growth by 5 points, and we have such a diversified portfolio of products that if for whatever reason we get bad news on one side, we are trying to, and we are managing to compensate on the other side. So that is kind of the story for 2027 at this stage, yeah.
Got you. In the news, and I feel like what a lot of people are trying to figure out is what all this mRNA news means for Repligen and bioprocessing companies. I know it is really challenging to kind of put numbers around it, but I think pre BioLife, new modalities was 16% of sales. mRNA probably puts it in the low to mid single digit range. Just from a high level, is there anything about mRNA production that is particularly heavy in its use of either filtration or chromatography or kind of anything that you could just mRNA in particular, and then really what parts of your portfolio are kind of geared towards that modality?
Yeah, no, mRNA is a modality we like from a lot of angle. First of all, think about it, during COVID, billions of people around the world have been taking some mRNA vaccines, and this is what I like to call sometimes the largest clinical trial that has ever happened in the history of the world somehow where indeed billions of people have been vaccinated. So to see that piece of news coming from the Moderna INT project combined with Merck project, it is very exciting for the entire industry because for bioprocessing company, mRNA is presenting a lot of opportunities. If you look at products as you ask, it can start with any type of resins that are being used in two steps.
One for the first step, which is the DNA plasmid manufacturing, and the other one, which is for the final purification of the mRNA product. The first catalog product we launch is enabling customers to get rid of the biggest impurity you are getting in an mRNA process, which is a double-stranded RNA. That is the resin piece. Then if you have resin, you have to pack resins. Very often those mRNA customers, they have to pack hundreds of columns because it is going into smaller type of population batches and so on. They do not want very often to pack these columns themselves, so they use column packing, so that is great opportunity for us.
Then you add the filters, then you add the fluid management because as far as fluid management is concerned, the needs are very different than the needs you have on some other businesses like monoclonal antibody, which are mostly dealing with very large processes. mRNA processes are much smaller and so on. Then finally, PAT technology. Of course, there are a lot of opportunities for suppliers like ours across the board in term of the portfolio here.
That is great. Thank you so much. Another area that we get a lot of questions. BioLife acquisition, obviously biggest in the company's history. It seems attractive. High consumables mix, dominant market share. Why did you think that this was the right asset? Particularly, I guess the questions that we get is why cell therapy? I know you have touched on it, but if you can provide anything there, that would be great.
Yeah, no, sure. First of all, we did a lot of homework, Evan. I can tell you we spent six, seven months in total to really make sure we were making the right decision here, doing multiple market studies about cell therapy in general, understanding what the trend were, trying to overcome potential risks, like the potential emergence of in vivo therapies and so on. We did that homework first, and then we realized, well, first of all, it is a huge new modality for our customers. 25%, so one product out of four in the overall funnel pipeline of pharmaceutical, biopharmaceutical drug today is a cell therapy drug. Then you add today it is mostly CAR-Ts that are commercial. You start to see the emergence of allogeneic drugs and later on iPSCs as well. We realize this is a very fast-growing market for the next decade for sure.
Secondly, looking at that specific asset, BioLife has done an amazing job to really differentiate itself. As you know, we like to say 80% of our portfolio is differentiated. Their portfolio is very differentiated as well, so the fit is also very good here. On biopreservation media, they are already designing 18 commercial drugs. They are designing in more than 80% of any phase II and phase III drug as well. So we know there is a lot of tailwind that is going to come in the next few years from the next FDA approval across the board here. Finally, two things. First of all, there is a little joke. We are going to hit the $1 billion number next year, which for a company like Repligen, it is a big milestone for us. We have been growing very nicely, as you all know.
I do not think there are a lot of people who would have bet that Repligen would be a $1 billion by 2027 several years ago or so, and that is a big milestone for us. One of the reason why is because we have got that very diversified portfolio of product, but also very diversified end market approach. We talked a lot about mRNA. We talked a lot about gene therapy in the past. We had a very small play in cell therapy. Now, with this acquisition, we are going to balance our play into new modalities much more evenly between cell therapy, mRNA, and gene therapy as well. Also across the board, really exciting for us. As we mentioned, it is accretive across the board. I tell you, I have looked at a lot of acquisition in my career.
I have never seen an acquisition target that was accretive to top-line growth, gross margin, and EBITDA margin as well. So we like it, and at the end of the day, pretty simple integration and pretty low-hanging fruit as well for generating synergies here.
Yeah.
Yeah, when you look at those synergies, we feel like they are pretty straightforward, right? We called out about $20 million in year one. Most of that, 15 of that is in the OpEx side, very much tied to public company costs, leadership costs. CEO expense.
He is being paid pretty well.
Yeah.
Indeed.
Fortunately, he will want to find a retirement home here next, and then that leaves us with, I think, again, a lot of straightforward synergies. On top of the leadership side, there is the redundant public company costs that come with that, board expenses, et cetera. The rest is on the cost of goods sold side, which really has to do primarily to start with helping them to work through some of the yield and bag issues that they have shared with. Luckily, we are a supplier of single-use bags, and so we are able to find a path with them to create benefit with that.
We feel like we have been pretty conservative with the overall modeling, both in the synergies and we did not bake any top-line synergies in, but we do expect there to be in both directions, right? They are expecting to several commercial drugs. We are not. We will be able to tap into the relationships they have, sell that broader portfolio that Olivier just talked about, and be able to continue to drive some good benefits. We love the deal overall.
Got it.
Finances are great.
Yeah. Just something you said that just kind of struck me. So the synergies are going both ways, revenue. If they are in a commercial drug, how easy is that for them to switch to Repligen if you are not in there already, if it is commercial?
I think what Jason Garland wanted to say is indeed they are designing in 18 commercial cell therapy drugs. I do not think we are designing in any of these 18 with the Repligen portfolio. What I think Jason Garland was alluding to is that is going to open us doors for the Repligen portfolio and maybe not for those commercial drugs specifically
Right. Things in their pipeline
but more broadly for the pipeline where we might
Okay
not have had those high-level contacts
Got you.
at those accounts that we will have now because we are supplying them a very important product for those drugs. Yes.
Great. Maybe another one for Jason Garland on margins. Like you said, really great quarter. I think up 380 basis points. You have this goal of 30% EBITDA margins by 2030. My math is kind of like over 200 basis points a year. It is a lot. So how should we think about the trajectory of that? I think all this was contemplated before Polymem and BioLife Solutions, so how should we think about that goal in light of those changes?
Yeah. So, you are right. It is a big step in each year. We announced earlier this year a transformation office that we have been executing. So that is a way to help accelerate that. So we actually feel like some of the growth will come over the next couple of years versus all being back-ended loaded. So we do see that benefit. Polymem was contemplated within the transformation office, but to your point, certainly the BioLife Solutions acquisition was not. At this point in time before we close and build out a consolidated set of financials that we will share, we really think of that as helping to accelerate that path to the 30%. But we will pull all that together and re-profile how we see it playing out.
I think the other thing for us is that as we continue to execute that margin expansion, it also gives us more room and flexibility to reinvest, right? Making sure that whether it's in more R&D spend or technology, whether we want to double down more on some commercial and sales resources, to really help bolster our top-line growth, that we're going to have some of that flexibility. We're really happy with the trajectory we've had, the discipline that the team's built, and we'll be able to leverage that more broadly.
Great. Very exciting. Maybe on AI, I know this is an important topic for you guys, transformation office, working on that, putting that internally. I guess I'm more interested in terms of your products, and how that is going to be aimed or is aimed at helping your customers implement AI and do things faster, increase throughput. I think your PAT portfolio technologies and integrating that with your system seems like an obvious place. You had the Novasign deal, Next-G eneration TFF you've talked about. Can you just talk about this and then explain how important that is, integrating AI in your portfolio in order to differentiate your offering?
Yeah, no, and I think you phrased it well already in your question, Evan. It's a three-step journey really. It starts with PAT. It's going to be emphasized by digital twin, and then finally, it's going to conclude to AI. Trying to be a bit more specific here, in order to use AI, you need data. Whatever business you look at, you can't use AI if you don't have data. The only way we can help our customers to start with is to enable them to collect that data. And the data are going to collect from two front. One is going to be on the process development side, and the other one is going to be on the manufacturing side. And the only way to collect data right now is via PAT technologies.
I'll give you a number that's going to probably strike you and people here, is last year we said probably 20%, 25% of the system we were selling were coming alongside our PAT technologies. In the last three months, it went up to 80%. And it's only three months, but for us, it's extremely encouraging because it means those people who have started to embed those PAT technologies have used them and liked them, and now they say, "Well, I'm just not going to buy a system now without having the PAT technology alongside." So that's really the first step, and we've got six PAT technologies. Only one is in line right now. We are going to work to make sure we get a second, and if not a third one in line over the next couple of years.
Then this is where digital twin comes, which is what is digital twin? Digital twin is a software that enable you to try to understand what the data you are collecting means. Are you going to be better at developing a process using that resin? Are you going to be better at running the process under these type of parameters and so on? By using these digital twin capabilities, it is giving you a first hit.
Later on, once you are going to be having a lot of data point with your PAT technologies, once you have used digital twin to become faster at developing your processes and so on, then you are going to start to use those very broad AI engine that will enable you to just look at the data you collected over the last 100, 200 batches you have manufactured and being able to tell you after one hour, "That is going to be a good batch. That is going to be a bad batch." Then you can stop it after one hour instead of waiting for two weeks.
Can you imagine if you are a CDMO, it is a big game changer because for a CDMO, it is all about the time you use to manufacture and sell product. You do not want to run a batch that is going to be a bad batch. It is going to be a multi-year journey. What is going to be really important is today we sell the PAT technologies. We are going to try to sell the digital twin technology as well, and then later on partnering with the right AI company and so on is hopefully starting to be able to also sell the AI software to become like an extension of our customers in a way.
Got you. Maybe moving to proteins, 50% growth there. Do not think we expect that to be the same going forward. Can you just talk about what you are seeing in that business and as we think about the long-term growth opportunities there, how should we be thinking about things?
Yeah, no, I love all of my franchises. There is one I am really proud about, that one, because, and I literally, Jason and I exactly joined three years ago, now. I tell you, when we came, maybe literally a few months after, we heard about our two key customer on the protein A side who had decided to just stop buying from us completely. It was like the most horrific scenario you could think about. We just felt like, "Hey, what are we going to do?
We have to just reinvent ourself, and reinvent ourself from every angle." Meaning on the one side, doubling down on the collaboration we had with the last OEM partner we have, which is Purolite, and then on the other side, making sure we start to have our destiny in our hands by having a real innovation engine for both ligand and resin as well, with the acquisition of Tantti. I have to say, it has worked beyond our expectation. It is just happening across the board. The collaboration with Purolite has been great. Seeing in the Ecolab quarter two results, even though Ecolab is a big company, they did mention that they are getting market shares. They are getting market share on the resin side.
On our own resin side, we are multiplying the wins across the board for both very innovative products in the new modality, but also more interestingly, in some of the older franchises where people have realized there is a shop called Repligen that is capable to develop a ligand and resin for them in less than six months, which is a fraction of the time it takes to the other guys. We have won a lot of those R&D product development deal over the last one to two years, and this starts to generate significant sales. The best is yet to come. It is probably going to still be lumpy. So back to your question about are you going to be able to have a 50% growth every quarter? The answer is no.
Is the objective to grow very fast on the protein side over the next five to 10 years? Absolutely. We get so many bets across the board, I think it is going to be a fantastic story for us in the midterm here, for sure.
Right. Moving to capital equipment. Things are still kind of weak there, but it sounds like there is some sign of life in the quarter. Orders are up, book-to-bill above one. You have talked about a bunch of things. Getting a seat at the table, you have two RFPs with maybe another one coming, onshoring, and then just fundamentally, you have talked about an under-investment on the part of the industry, probably since COVID. So where do you think we are in this. Obviously, we are in the bottom of the capital equipment cycle, but what does this recovery look like? Because it seems like there are a lot of different industry-specific things, but also company-specific things that have changed probably since the last cycle.
Hey, Evan, let's start with the good news. We won one RFP in Q1, one in Q2. We already won two in Q3. Where it is still not as fast and as big as I would have thought it would be when we enter into 2026, at least we do have a seat at the table. Not only we have a seat at the table, we are winning some of these RFPs, which for us is obviously a great sign because we never even had a chance to win those in the past. The other flip side of it is not happening probably as fast as all of us would have liked to see it happening. I know I have been talking about the tap opening sooner or later, very strongly. I think it is probably 5% open right now.
Even with only 5%, we start to have some good win, which are going to be mostly delivered in 2027. We are starting to build a nice backlog for 2027 of those hardware deals we are winning. I think the best is still to come. I think we have not seen probably more than 5%-10% of what is going to come over the next few years, because it is going to be a combination of some of these onshoring big projects becoming more and more in term of number, but also the urgent need now for our CDMOs and pharma customers to really go back to the hardware upgrade cycle that they have been ignoring mostly for the last three years. Technologies are improving.
Back to the story on PAT, people who have been testing our PAT technologies now for the last two to three years, they probably realize, "Hey, you know what? Not only we need to upgrade the equipment because there is better equipment today, but on top of it, that is going to enable us now to pair it with the PAT technologies that are available." The good news is we are still at the beginning of the cycle here for sure.
Right. Process analytics, another strong quarter, 30% growth. Maybe kind of digging in there, where are you seeing the most strength? Is it broad based? Are there particular products that you're seeing the most demand? You've talked about the SoloVPE PLUS upgrade cycle. How much is that contributing, and are there other areas within the portfolio where you see opportunities for upgrade cycles?
It's a combination of multiple factors. You don't grow more than 20% in 2025 and midpoint, I think, of our guidance is 25% in 2026 without having multiple reasons for that. The market itself is becoming better and better, and I think we've seen some of the big analytical company instrument talking about it recently quite a bit as well. They're seeing it as well. That's a good sign, by the way, for the bigger CapEx spending because, at least to my own experience, very often, you start to see the beginning of a new cycle with a smaller scale type of equipment, which are easier. Your procurement, your finance right hand is going to release funding for small scale hardware faster than for larger scale. So that's another good sign. But it all start with the market getting better. Then obviously you mentioned the upgrade cycle.
One of the thing we are getting more and more focused on is life cycle management of our product. We never really launched new version of our product in the past. There was not a new version of the Solo for the last 10, 12 years. So people were just delighted to see something that's much faster, much more accurate than what we had before. We are still at the beginning of the cycle of the upgrade. We have a pretty strong target in term of what we expect the upgrade and cycle to be at, and we're going to start working on the next generation of Solo probably in the upcoming few quarters as well, so that we keep on having that life cycle management.
The last piece I would mention is, we've done a great job for the analytical franchise as well to push both consumables and service sales because those recurrent sales are great, obviously. It's not that we had a great attachment on both sides before, and slowly but surely, we are focusing on that more and more. I have one last, which is 908 Devices. 908 Devices acquisition, which is like 15, 16 months ago now. It's fair to say the integration has taken us more time and energies than we thought initially. The great news is now everything is in full order, meaning in term of quality, in term of regulation and so on, that we can finally start to push for that product portfolio, and that should be a really nice tailwind for us in 2027 and beyond.
Yeah. No, they had some good technologies. It's nice to see it end up in your hands. Filtration, high single-digit growth last year, mid-single digit growth this year. There's significant headwinds there, though, from Sarepta ATF. How do we think about this business in the long term? Historically, I've kind of thought of it as like a low double-digit grower. How do we kind of get back there?
Again, when we entered into 2026, I had no clue, like this would be the least performing franchise of all. I can guarantee you. Life has taught me that in my 30 years of experience. You do budget, and then you deliver the year because you have to, but you never deliver it the way you think you're going to deliver it. We just pile all of the headwind we had in the business all came in filtration this year, even including one, which is an inorganic play when we decided to sell Polymem, which cost us a point something of growth as well. Anyway, the good news is we start to see nice rebound on ATF in the last couple of months. We're also tracking how many new program customer are we winning.
After four months and a half in 2026, we had won as many new customer/program as we had in the first six months of 2025. It means like we are still getting more and more customer willing to use and starting to use ATF. One of the interesting trend we've seen lately is more people using it for smaller scale type of product, which at the first glance was like, "Oh, wow, that's surprising," and maybe we're going to get less consumable. It also means people really love the technology because where I thought it's probably going to be mostly focusing on products that are requiring a few hundreds of kilogram of mAbs every year or maybe a metric ton. Now we start to see people using it for processes that only require maybe 100 kilogram of mAb per year.
Which shows you people are really becoming much broader on it and so on. That's something we were hoping to see the benefit of very soon. It's fair to assume like where this year, the three other franchises have been the one growing faster and so on. There is a good chance next year we're going to see a different setup between the four franchises. We are still very bullish on ATF. The other big part of the filtration franchise is our downstream system, which also have been impacted by the lack of decision-making on the CapEx spending side. If razor tap opens, there is all reasons to be optimistic about next year for filtration.
Mm-hmm. Maybe just rounding it out, going to chromatography. It's been two straight very strong years. I've always thought about the differentiation there being just the breadth of the portfolio from small scale to large scale. Maybe there's more to it than that. Is there something else that we should be thinking about there? Why has it been so strong? Then again, after two strong years, how should we think about the underlying growth opportunity there?
I think, I know I said that a few times already is people are realizing, like packing a column is not a core activity for a pharma company. Why would you need to have, I mentioned for mRNA in particular, which is a perfect example, why would you need to have very big team of people to pack columns where you're not sure exactly about the amount of column you're going to have to pack month one, month three, month 12, or whatever. That's partly is the case for CDMOs, because CDMOs, they really don't know exactly what product they're going to manufacture quarter by quarter. They want to have their prepacked column on the shelf to be able to react very fast.
But on the pharma side, which is where we had most of our wins over the last couple of years, they've realized they've lost the expertise as well because when I started my career, very often people were starting that career packing columns, then they would do that their entire life. Now I can promise you the new generation and so on, they're going to do column packing for a year, two years, and so on, then they want to do something else. Really, column packing is a real art. You need experience, knowledge, and those pharma company realize they have a lot of losses of product because people are losing expertise, and that's going to benefit us greatly for the next several years. The good news is it's only a fraction of the total column packing market that is being using prepacked column today.
There is still a lot of traction here, for sure.
Great. China, sorry. China, APAC, 40% in 2Q. I think China was up 60% in the first half. Is this mostly China, CDMOs in South Korea? Where are you seeing within your portfolio the most demand? What does this let you do that you really couldn't do before?
Hey, listen, I'll be humble for once. We're starting from a really low point. If there is one business that has not been doing well at all for the company for the last five years or so, it's really our business in China. I've said it very openly, I think we've lost market share to a lot of local company over the last five years. We are working on two sides right now. One is to reclaim some of this market share we've lost, and this is why we signed that OEM deal, and we're starting to see really good traction on that, where we're starting to reclaim some of our lost market share.
But more importantly, because I'm totally convinced the China market is going to be the fastest-growing biopharmaceutical market over the next decade, we are starting to win in areas where we didn't have a play earlier. Back to resin, interestingly enough, we get a lot of design-in win with some of the resin we put on our shelf in the last two to three years for companies that are very heavy on the new modality side. So, it's a mix of reclaiming market share loss and then gaining market share on some of the products we didn't have on the portfolio before.
Okay. The OEM relationship?
Yeah. No, it is progressing very well. We are on a flight to China, Jason Garland and I, on Friday night, to visit our OEM partner and discuss the next steps together. We are going to start with them manufacturing some of our filters to start with, and we have got multiple other projects that we are going to talk about together.
Cool. Probably have time for one more question. Got a couple here. I think if we went back 4, 5 months, maybe 6 months ago, people thought that ATF was doomed. A competitor was coming out with a new product. And now we just do not really hear about it. But it is funny, and I got this from using AI when I was preparing for this, but I go and look at Danaher's product, and I see their press release, and I see your name. So you actually know the product very well. I think instead of ATF, it uses TFF. Is that correct? So in terms of the different technologies, and I assume they are using a very similar technology, with some upgrades. What is the difference between using TFF versus ATF?
Yeah. And we have said that also very openly. The only real competitor we have to ATF right now is TFF, huh? So when I joined three years ago, I realized we have both. So I said, "Why are we maybe working a little bit too much in SILOS where we are so obsessed by ATF that if TFF openly comes, we do not even consider it, and we are trying to convince people to do ATF, ADF?" So first of all, when I joined, there were three pharma companies that were still not using ATF. Now we are down to only one. It means two of the three that were TFF, they have moved also to ATF in the meantime.
And it is not very often the case, but any time there is a company that really consider using TFF instead of ATF, we are bidding, and not only we are bidding, we are winning. So I do not think we have missed a single process intensification deal over the last two years, three years I have been here. And 90% of the case, 95%, it is ATF, and then the 5%, 10% TFF, we are winning it with our own equipment as well. And so from that point of view, and again, I do not want to feel complacent because I tell you, I am totally worried about what might happen every day, and I am pushing my team to make sure we are monitoring what is happening.
Today, we have got the luxury that we do not have any competition at all. It is going to come one day for sure, and we are going to get ready. We are very heavy on R&D, as you know, and we are already working on the next generation ATF system that we hope to launch probably in about 15 - 18 months from now or so.
Great. No time left. Perfect timing. Thank you so much for joining us. It was a great conversation.
Thank you. Thank you very much. Thank you.