Kyle Crews

Kyle Crews of UBS inquired about Maravai's midterm growth outlook for its base business, considering the broader industry headwinds in scientific R&D spending.

Answer

CEO Bernd Brust noted that Maravai's direct exposure to U.S. mRNA research funding is not significant and emphasized a focus on growth in non-U.S. markets. CFO Raj Asarpota pointed to the company's 5% base revenue growth in Q2 and cited peer long-term growth targets in the mid-to-high single digits as a relevant benchmark for the market.

Kyle Crews of UBS Group questioned the organic decline in software bookings, asked for an early outlook on 2026 growth, and inquired how Certara plans to make regulators comfortable with AI's integration into model-informed drug development (MIDD).

Answer

CFO John Gallagher stated that the company does not rely on an improving end market and that R&D investments and product launches are intended to drive growth. CEO William Feehery addressed the AI question by emphasizing that the goal is not to create a 'black box' but to use AI to accelerate the creation of explainable models, improving speed and cost without sacrificing transparency.

Kyle Crews sought clarification on the 2025 organic growth guidance for each business segment and asked about efforts to expand the Simcyp software's reach beyond its core consortium.

Answer

CFO John Gallagher broke down the 2025 organic growth guidance: 4-6% for the total company, 2-4% for services, and 6-8% for software. CEO William Feehery explained that Simcyp is delivered through multiple channels: the core consortium, direct software sales, and project-based services for smaller clients. He also noted that integrating Simcyp with QSP software is a key initiative to expand its user base.

Kyle Crews asked about the drivers behind the unique demand for biosimulation and its divergence from the regulatory business, as well as the company's exposure to small versus large molecule drug development.

Answer

Executive William Feehery attributed strong biosimulation demand to three factors: sustained investment in product capabilities, increasing acceptance by regulatory agencies, and its cost-effectiveness compared to clinical trials. Regarding molecule types, he stated that Certara's business mirrors the pharmaceutical industry's R&D mix, and its tools are widely used for both small and large molecules, with usage for the latter growing in line with industry trends.

Kyle Crews of UBS Group AG inquired about the drivers of product revenue outside of cell and gene therapy, the adoption progress of the IntegraCell service, and the rationale for maintaining guidance despite a strong quarter.

Answer

Thomas Heinzen, VP of Corporate Development & IR, noted that product revenue was driven by an 8% increase in MVE sales, particularly from the animal health sector. Dr. Mark Sawicki, Chief Scientific Officer, stated that IntegraCell is on track for initial revenue this quarter with a meaningful ramp in 2026. President & CEO Jerrell Shelton explained that guidance was reaffirmed out of prudence, citing global economic and geopolitical uncertainties.

Kyle Crews inquired about the launch progress and client adoption of Cryoport's IntegriCell solution and asked for an update on Cell & Gene Therapy (CGT) clinical trial growth and the overall health of the market.

Answer

CEO Jerrell Shelton affirmed a positive market outlook, citing strong commercial revenue and trial growth. Chief Scientific Officer Dr. Mark Sawicki added that the CGT space saw a 30% financing increase in 2024, stabilizing the market. He noted robust progress with 20 supported therapies and anticipates 17 more filings in 2025. Regarding IntegriCell, Dr. Sawicki confirmed that facilities in Houston and Liege are open, with multiple commercial contracts already being onboarded.

Kyle Crews asked about the expected evolution of the non-cell and gene therapy portion of the services business over the next year.

Answer

CSO Dr. Mark W. Sawicki anticipates modest growth in areas like direct-to-patient and other biopharma services, noting the non-cell and gene market is softer. However, he expects continued growth in reproductive medicine, particularly ex-U.S., and an acceleration in clinical trial activity for companion animal cell therapies.

Kyle Crews from UBS inquired about the expected cadence of end-market demand in 2025, how 2024 cost-saving measures will impact 2025 results, whether reduced incentive compensation was a factor in margin improvement, and any anticipated business changes from the recent election.

Answer

CSO Dr. Mark Sawicki highlighted the strong clinical portfolio as a driver for the services business. CEO Jerrell Shelton reiterated that the MVE business is profitable and poised for operating leverage. CFO Robert Stefanovich confirmed that the over $20 million in annualized cost savings are on track, leading to sequential adjusted EBITDA improvement and positive operating cash flow in Q3. He stated the company expects to achieve positive adjusted EBITDA during 2025. Mr. Shelton saw no significant business impact from the election.

Kyle Crews from UBS Group asked about the potential impact of Sarepta's clinical trial hold on Medpace and requested broader commentary on the cell and gene therapy market.

Answer

CEO August Troendle stated definitively that the Sarepta situation has "no impact" on Medpace. He acknowledged the company has some exposure to the cell and gene therapy space but not a "great deal," and the specific issue with Sarepta is not expected to affect any of their ongoing programs.