Repligen Corporation Aktie

Good morning and welcome to Repligen's Third Quarter of 2026 Earnings Conference Call. My name is Julian, and I will be your operator. [Operator Instructions]

I will now turn the call over to Jacob Johnson, Vice President of Investor Relations for Repligen. Jacob, please go ahead.

Thank you, operator, and good morning, everyone. Welcome to Repligen's 2026 Third Quarter Earnings Call. Joining me today are President and Chief Executive Officer, Olivier Loeillot; and Chief Financial Officer, Jason Garland.

Earlier this morning, we issued our earnings release and supplemental presentation which are available on the Investor Relations section of our website.

Before we begin, please note that today's discussion will include forward-looking statements and certain non-GAAP financial measures. Actual results may differ materially from those expressed or implied by these statements due to risks and uncertainties described in today's earnings release and our SEC filings. Reconciliations of non-GAAP to GAAP measures are included in today's earnings release and supplemental materials. These adjusted financial measures should not be viewed as an alternative to GAAP measures, but are intended to best reflect the performance of our ongoing operations.

With that, I'll turn the call over to Olivier.

Thank you, Jacob. Good morning, everyone, and welcome to our 2026 third quarter call. We had a record quarter with $209 million of revenue. This is a significant milestone as we surpassed our prior peak in the second quarter of 2022. We believe this is another proof point that the industry is poised for its next phase of growth. It also highlights the benefits of our diversified portfolio and this was driven in part by proteins and chromatography.

In addition, we were delighted to close the acquisition of BioLife earlier this month. This combination further expands our capabilities in the rapidly growing cell therapy end market and strengthens our long-term growth platform.

We will discuss our initial observations and integration efforts in a moment. But first, we delivered $209 million of revenue in the third quarter which represented 12.5% organic growth, while expanding adjusted operating margins by 170 basis points compared to the prior year. This was an excellent result as we were lapping a very strong quarter in the prior year. Our ability to outpace market growth very significantly this quarter is a testament to our team's strong execution in a market that is still recovering.

Following these strong results and incorporating the BioLife acquisition, we're increasing our 2026 guidance. Jason will provide more details.

Our updated 2026 guidance includes an expected $24 million revenue contribution from BioLife for the period following this close in our fourth quarter. This assumes BioLife annual 2026 revenue on a pro forma basis will be approximately USD 114 million, above the midpoint of BioLife's most recent guidance. The business is performing well, and we are very confident about delivering our deal model for 2027 and beyond. With the recent acquisition and ongoing integration we are taking a prudent approach to our initial assumptions for the remainder of 2026.

We are narrowing our organic growth outlook to 12% to 13%. At the midpoint, this represents a 50 basis point increase and assume fourth quarter growth is within the full year range. This also means we will deliver a gain on our full year commitments and outpacing markets significantly.

As I reflect on our end markets, we remain encouraged by the continued improvement in the bioprocessing industry. Importantly, our funnel and order activity continue to strengthen. This is particularly true for capital equipment. Capital equipment orders increased mid-teens year-over-year and was the highest orders quarter in 5 years, while revenue declined.

The tap has not opened as quickly as we would have expected it this year. However, we continue to see encouraging signs in our funnel and order book. We are building a backlog for 2027 and will enter next year in a better position than we did in 2026.

As a result, we remain encouraged that we are seeing a gradual improvement in capital equipment demand with a notable pickup in orders for our systems. We are actively executing initiatives that will strengthen our equipment business and prepare us for the next phase of growth. This includes continued investment in innovation as well as strategic efforts designed to deepen customer engagement and support large-scale manufacturing expansion projects.

One example is our integrated solution team which is focused on addressing customer capacity expansion, such as onshoring. Consumable demand remained outstanding with 20% growth in the quarter, while services was even stronger with greater than 20% growth.

Our services team continues to execute extremely well. Year-to-date, our services team has increased the number of systems under contract by nearly 40% despite a muted capital equipment revenue environment. In addition to incremental service revenue, this allows us to be closer to our customers and provide further insight into their needs.

Services represented 7% of our revenue in the quarter, and we expect it to become a larger mix of our business going forward. In short, our base business remains strong as highlighted by our 12.5% organic growth in the third quarter.

Our funnel and orders suggest a continued improvement in the end market. In addition, we continue to execute our innovation strategy to drive above-market growth.

Moving to our performance by end market. Biopharma revenue drove growth while CDMOs declined on a difficult comparison. Year-to-date, we have seen similar trends for both customer bases. Biopharma growth was strong in all regions, as Europe returned to growth on a more favorable comparison, while year-to-date, biopharma growth has been driven by strength in North America and Asia Pacific.

Emerging biotech grew mid-single digits on a difficult comparison from last year. Demand trends remain healthy as year-to-date emerging biotech revenue has increased in the high teens. New modalities were relatively flat, but grew high single digits, excluding the impact of a certain gene therapy platform. This was led by nearly 30% growth in cell therapy.

In addition, gene therapy demand grew on an absolute basis and north of 25%, excluding the gene therapy headwind. We continue to believe new modalities will be accretive to our medium-term outlook and we're excited to expand our capabilities with the addition of BioLife.

Moving to our strategy update. I wanted to share some initial observations on our first few weeks ownership of BioLife. I will leave you with the most important takeaway first. We are even more excited about the strategic rationale of bringing our organizations together and the value we will create for patients, customers and shareholders.

Jason and I were fortunate to spend time with our team at BioLife side, and I recently joined the BioLife team again in both Brussels and Indianapolis to celebrate the closing. We walked away impressed by our shared culture of innovation and customer centricity. We are thrilled to expand our offerings for the cell therapy market.

Customer feedback has been very encouraging, and we have received a number of positive responses after the acquisition. After months of thoughtful planning, our combined teams are now focused on executing the integration plan and realizing the opportunities we identified ahead of closing. In fact, our team are hosting an integration workshop in Waltham as we speak.

We have already completed actions to deliver a sizable portion of our operating expense synergies. This includes capturing public company and certain leadership costs which represent more than half of our anticipated year 1 synergies. As it relates to cost of goods sold, our team is already hard at work, evaluating potential options to improve CryoStor's scrap rate.

Finally, our commercial team are now collaborating to achieve revenue synergies. We recently cross-trained both commercial teams. We continue to believe our offerings will benefit from BioLife's trusted customer relationship. In addition, our Asia Pacific team has begun to explore the opportunities to increase awareness of CryoStor in the region, particularly in China.

As we look ahead to 2027, we remain focused on outpacing market growth. Assuming the market is growing high single digits, and with the acquisition of BioLife, we are positioned to grow our reported top line at least 25% next year, absent a material change in foreign exchange rates. This will result in our revenue exceeding USD 1 billion, which represents another significant milestone for our company.

Additionally, I wanted to spend some time on our Asia Pacific strategy. As Jason will discuss in more detail, we had another very strong quarter in China with greater than 40% growth. In China, we're advancing several strategic initiatives to strengthen our position in the market, including ongoing technology transfer with our OEM partner as we work to recapture share.

Notably, China recently published its latest 5 years biotech plan. The government expects the industry to grow at over 20% CAGR through 2030. This speaks to the growing activity in this country, and we remain convinced China will be the fastest-growing biopharmaceutical market in coming years. Beyond China, there are significant growth opportunities in the broader Asia Pacific region.

Last week, we opened a new Repligen Training and Innovation Center in South Korea. This underscores our commitment to a strategically important market that has become one of the world's leading hubs for biologics and CDMO manufacturing.

Before I turn the call over to Jason, I'll provide some more detail on our franchise level performance. I will note that all references to our 2026 expectations are on a reported basis.

Starting with filtration. As expected, the previously disclosed ATF headwind was most pronounced in the third quarter and resulted in an 11% decline in filtration revenues. I'll note this includes a 2-point headwind from our polymer divestiture and foreign currency. So the decline was slightly greater than we expected. This was largely timing related with most of our systems order planned for delivery in 2027 per customer's request.

We are encouraged by the hardware backlog we are building for next year. We now expect filtration to be flat to slightly down for the year. This includes the inorganic impact from the sale of polymer.

Turning to chromatography, revenue grew over 50%, with some help from a favorable comparison in the prior year. This was again driven by growth in OPUS columns with continued growth from CDMO and biopharma customers. In particular, we continue to see significant traction with large-scale columns. We now expect chromatographic growth of at least 30% full year.

We had another great quarter in proteins with more than 40% growth, again driven by strength across our portfolio, including positive traction in ligands, growth factors and our custom and catalog resins. We are also pleased to share we recently extended our supply agreement with Ecolab and are excited about our continued partnership.

Our protein strategy is working marvelously and we continue to expect mid-teen growth for the full year. Our analytics franchise had another record quarter with 20% growth, a strong outcome given we faced our most difficult prior year comparison. The growth was driven by a robust demand in consumables and services, while capital equipment remained healthy.

Our downstream protein concentration analytics offering were recently recognized in the USP Chapter of 507 standards. These are widely accepted quality standards used by biopharma manufacturers and regulators. This is a significant milestone that provide external validation of the technology and strengthen our credibility with biopharma customers.

From a commercial standpoint, this recognition should help us reduce barrier to adoption, support broader development of SoloVPE PLUS across products and sites and strengthen the longer-term opportunities for FlowVPX as customers adopts the technology more broadly.

In addition, we have seen traction recently with our PAT-enabled systems, which further expands the FlowVPX opportunity. As the industry continues its journey towards AI and digitization, we have engaged with several key customers who are sharing their AI-enabled process development and manufacturing strategies. This highlights the growing importance of our advanced PAT and digital twin capabilities. Given momentum in downstream demand and a growing contribution from our upstream analytics, we now expect analytics growth of at least 30%.

Before I hand the call over to Jason, I wanted to reiterate how proud we are of our Q3 results as we outpaced industry growth again and how excited we are about the growth opportunities in front of us. This is especially true as we have BioLife therapy capabilities to our portfolio.

The progress we are making in delivering our strategy is increasingly reflected in our results. This is a testament to our team's strong execution and hard work. We have several initiatives underway to drive future growth, including our integrated solution team and Asia Pacific strategy. Combined with our fit-for-growth investments and transformation office, these efforts are helping us build the capabilities and discipline needed to deliver profitable growth.

Now I'll turn the call over to Jason for the financial highlights.

Thank you, Olivier, and good morning, everyone. Today, we are happy to share another strong quarter results in Q3. These results from our continued execution coupled with the strategic acquisition of BioLife allow us to increase our guidance once again. I look forward to sharing the details shortly.

Before we discuss the quarter, let me highlight that, unless otherwise noted, all financial measures discussed reflect adjusted non-GAAP measures. As shared in our press release, we delivered strong third quarter revenue of $209 million. This is reported year-over-year growth of 11% or 12.5% growth on an organic basis, which excludes the impact of acquisitions, divestitures and foreign exchange.

The previously announced sale of Polymem was slightly under a 1 point headwind to reported growth. And foreign currency was also just under a 1 point headwind as the dollar has strengthened. And for clarity, we recognized de minimis tariff refunds in the quarter.

As Olivier provided details on our product franchise performance, I'll now share more color on our regional performance. Starting with quarterly revenue mix. North America represented approximately 49% of our total; EMEA represented 34%; and Asia Pacific and the rest of the world represented approximately 17%.

North America grew 6%, driven by strength in proteins and analytics, while lapping our strongest quarter in the prior year. EMEA grew over 20% on broad-based strength and a favorable comparison and Asia Pacific declined slightly on a tough comparison with record sales in the third quarter of 2025.

We continue to deliver on our strategic priority of Asia Pacific growth with third quarter orders breaking our prior record. Asia Pacific demand remains very healthy with high teens growth year-to-date. China demand was again robust with greater than 40% revenue growth in the quarter and strong orders. Year-to-date, China sales have grown greater than 50%.

Transitioning to profit and margins. Despite the anticipated mix headwind, we had strong margin performance in the third quarter. Adjusted gross profit was $111 million and adjusted gross margin was 53%. This is a 30 basis point decline versus last year and consistent with our expectation that the third quarter would represent the low point for gross margin in 2026.

Volume leverage and price execution were positive drivers of margin expansion but were more than offset by product mix and inflation. Tariffs had a de minimis impact on margin and year-to-date gross margin has increased 140 basis points versus last year.

Continuing through the P&L, our adjusted income from operations was $33 million in the third quarter, up 24% year-over-year. This translated to an adjusted operating margin of 15.9% and which was an increase of 170 basis points year-over-year.

Adjusted EBITDA was $44 million in the quarter or 20.9% adjusted EBITDA margin. Underlying our margin expansion in the quarter with strong leverage achieved with a modest adjusted OpEx growth of 5%. Given recent trends, we plan to make some investments through the end of this year to support our expected growth in 2027. We will remain thoughtful about balancing investments in the business and expanding margins.

I would note, our GAAP results include a $41 million intangible asset impairment related to an intellectual property license agreement that was signed many years ago that unfortunately did not lead to a positive outcome. As an unusual non-cash and one-time event, the impact of this charge is not included in our adjusted results.

Moving to the bottom line. Adjusted net income was $30 million, a 16% year-over-year increase. Our third quarter adjusted effective tax rate was 25% due to the timing of a specific item in the quarter that we do not expect to repeat.

Our full year outlook is unchanged at approximately 22%. Adjusted fully diluted earnings per share for the third quarter was $0.53, compared to $0.46 in the same period in 2025 or an increase of 15%. We continue to see strong earnings conversion from our robust revenue growth.

Finally, our cash, cash equivalents and marketable securities position at the end of the third quarter was $863 million, up $53 million sequentially from the second quarter. This was driven by strong cash flow from operations, primarily offset by $5 million of CapEx in the quarter.

In October, we deployed approximately $550 million of cash, including fees and net of cash received for the BioLife transaction. As a result, our pro forma cash balance is currently greater than $300 million.

I will now outline the improved outlook in our adjusted financial guidance. For clarity, our guidance includes the contribution of BioLife for the period following the closing of the acquisition on October 6. As Olivier mentioned, given the momentum of our underlying business and with the partial quarter contribution from BioLife, we are increasing our guidance. We are now guiding to $844 million to $852 million of revenue or $848 million at the midpoint. This represents 14.5% to 15.5% reported growth or 12% to 13% organic. This is an increase of 50 basis points at the midpoint versus our prior organic growth guidance.

This assumes approximately $24 million of revenue from BioLife. This is offset by approximately 1 point of headwind from the sale of our Polymem operations we announced earlier this year. In addition, we now assume neutral foreign currency, which had been a tailwind in our prior guidance.

Our reported growth of 14.5% to 15.5% assumes the following across our franchises. Filtration is expected to be flat to slightly down. Chromatography will grow greater than 30%. We expect proteins to grow mid-teens. Analytics is expected to achieve more than 30% growth. And as I previously mentioned, we expect $24 million from a partial quarter contribution from BioLife.

We will initially share BioLife revenue as a separate franchise, though over time, we may evaluate our overall franchise reporting structure. We continue to expect 110 to 160 basis points of gross margin expansion for the year. So with BioLife, we will likely be above the midpoint of this range. We are raising our adjusted operating income guidance to a range of $135 million to $139 million and our adjusted operating margin guidance to 16% to 16.3%. This represents 220 to 250 basis points of operating margin expansion.

Our updated guidance reflects our strong year-to-date performance and includes BioLife, which is accretive to our operating margins. We're extremely pleased with our margin performance this year. Our disciplined cost control and strong execution have allowed us to outperform our initial expectations. As I mentioned previously, we do expect to make investments in the fourth quarter and into 2027 to support future growth.

Moving to the income statement. Our guidance assumes $18 million of adjusted other income. This reflects favorable interest income trends due to rising rates, offset by the cash deployed for the BioLife acquisition. This will reduce interest income to approximately $1.5 million in the fourth quarter. As mentioned earlier, we continue to assume an adjusted tax rate of approximately 22%.

Putting this together, we expect adjusted fully diluted earnings per share to be between $2.05 and $2.09. This is up $0.34 to $0.38 versus 2025 or up 21% at the midpoint. The midpoint reflects a $0.01 increase from our prior guidance. This assumes BioLife is slightly dilutive to earnings given we will recognize nearly a full quarter of expenses, but a less proportionate amount of revenue from BioLife in the quarter.

As Olivier mentioned, we have already completed actions to deliver a sizable portion of our operating expense synergies. As a result, we are well positioned to deliver on at least $0.05 of year 1 accretion in 2027.

We expect CapEx spend to continue being approximately 3%, 4% of 2026 revenue. For additional context, at the midpoint, our guidance assumes fourth quarter organic growth is in the range of our updated full year outlook. We also expect fourth quarter gross margin to be within our full year guidance. We expect operating expenses to be up low double-digit million sequentially as we plan to make some investments in our base business, and it will include a contribution of nearly a full quarter of BioLife operating expenses.

Before I close, I want to touch on our medium-term margin outlook and also provide an update on our strategic IT investments and AI efforts.

First on margins. We have outlined a path to 30% EBITDA by 2030. We're not formally updating these targets, but as we have mentioned previously, BioLife will be accretive to our growth and margins. With BioLife, we believe we could achieve this milestone earlier. This gives us the opportunity to explore reinvesting some of this benefit in areas that accelerate revenue growth instead of achieving this target sooner.

Potential investments include additional commercial resources and R&D innovation spending. As evidenced by our year-to-date performance, we are committed to margin expansion and have made good progress towards our goals this year. We continue to see opportunities from volume leverage, productivity and net pricing. We will balance this with the investments required to support and drive future growth.

One area we have invested in this year is strengthening our IT organization and modernizing our capabilities. We have world-class tools and have onboarded key talent this year, including a new CIO. Our team is focused on optimizing our data infrastructure as the foundation for more broad-based internal AI deployment. We have made considerable progress on these efforts including AI pilots, which are showing tangible results. We plan to leverage these initial learnings more broadly in our organization. In addition, we have launched regular training to empower our employees and their use of AI tools.

Finally, our operations team is working to drive productivity at our manufacturing sites through increased investments in automation. We're excited about the extensive list of opportunities ahead of us.

As we wrap up the call, Olivier and I would like to thank our global Repligen team for another quarter of strong execution. Our record results, increased guidance, progress in the BioLife integration, and continued investments in innovation and growth are all reflections of the team's hard work and commitment. We believe we are well positioned to continue outpacing the market and creating long-term value for our customers and shareholders.

With that, I'll turn the call back to the operator and open the line for questions.

[Operator Instructions] Your first question comes from the line of Brendan Smith with TD Cowen. Brendan, your line is open. Please go ahead.

Maybe I wanted to ask one on kind of the combined Repligen, BioLife outlook. I guess how should we think about maybe the cadence of integration benefits here and really where you see the most potential maybe for immediate or near-term upside versus some other aspects that will likely take a bit more time. And I guess, how much of your vision for this integration is really contingent upon any reacceleration of cell therapies broadly? Or do you kind of see the current state of that space enough to drive growth there, kind of, heading into next year? Just any color on your kind of underlying assumption there would be great.

Brendan, and thanks for the question here. So, as far as the first part of the question is concerned, I mean, we have already completed actions to deliver a sizable portion of our operating expense synergies, as we mentioned earlier, this really includes capturing some of the public company and certain leadership costs. But also, we are working on longer-term type of action, which is the bag opportunity. And as you know, they had a pretty high scrap rate and we are working on it with them to improve that, and that's a little bit more in the, what I'd call, mid- to long-term type of action here.

As far as the cell therapy market is concerned, I think we mentioned in July, when we signed the deal, we've made very careful assumption as far as the growth of the business for the next 5 to 10 years. And we said we are capitalizing mostly on the current commercial drugs, very high growth. And in fact, those commercial drugs have been growing more than 20% in sales over the last several quarters now. We've assumed to be really on the safe side as there could be no FDA approval offset therapy for the first 2 years after we acquired the business. And as you certainly know, Brendan, there have been 3 cell therapy approved this year already. So we are very confident about our ability to deliver on the business model for BioLife in '27 and beyond as well.

And I'd just add that, that then there's no change in our view of being at least $0.05 accretive for that first 2027 year.

Your next question comes from the line of Matt Larew with William Blair. Matt, your line is open. Please go ahead.

I wanted to ask on filtration. You mentioned that was maybe slightly worse than expected for you in the quarter, but there was maybe some timing that affected that. Could you just talk about sort of what led to that? Was it ATF or other parts of the franchise? And to the extent it wasn't ATF, just curious if you could comment on ATF and what your confidence is sort of looking into '27 given that there were some pushouts earlier this year?

Matt, so first of all, I'd like to say like it's a testimony where we have a really very diversified portfolio of product, because, yes, our filtration was maybe a little bit weaker than we expected. The other 3 franchises have been doing extraordinarily well. In fact, we had a record quarter for both analytics and chromatography in the history of the company. But yes, the revenue decline is as expected. I mean, you know we have the headwind of the gene therapy program. We have the 2 customer headwind on the ATF side, and also we sold the Polymem business. But it has been a little bit higher than we thought and the reason is really simply because of the system business.

I mean, and then you heard us saying we had the highest quarter of order in system for the last 5 years, which is fantastic news. There's -- The less positive news was that these sales are going to come in 2027. So the recognized sales of systems that are sitting under filtration, so it's a very broad portfolio of product under filtration and unfortunately are not going to happen either in quarter 3 or quarter 4 of this year, but they're all going to happen in 2027, which is why we are very confident like filtration will be back to historical growth levels in 2027.

Your next question comes from the line of Dan Arias with Stifel. Dan, your line is open. Please go ahead.

Jason, can you just maybe talk about product mix and how you think that, that sets you up into next year? And I guess I'm thinking specifically about filtration and equipment. Historically, I think filtration has been above average and equipment below average. So how should we think about the impact of those contributions stepping up if you guys are right about seeing a rebound there? Do you think the net effect mix is positive or negative as you look out a bit?

Thanks, Dan. So first, just for clarity, the far majority of our equipment sits in the filtration franchise. So the only thing that meaning that's really outside of it would be our analytics business that we -- than we sell our equipment through there. So that really is one and the same sort of dynamic filtration overall, to your point, ends up being accretive because of the pieces of ATF and other elements than some of the consumables flow that are above our margin.

So we -- for 2026, again, mix becomes a push, plus or minus in terms of what we're seeing this year versus last year. We're still, as you know, going through our budgeting process for '27. But see that, that is a similar case. So again, even as the systems piece of the equipment, which, to your point, would be lower than the average we're going to have other pieces of filtration in the other segments that allow for a lift.

And then you've got, of course, proteins, analytics that are accretive overall. So I think, again, in the end, mix becomes a plus or minus around the neutral level that we'll be able to continue to manage.

Your next question comes from the line of Doug Schenkel with UBS. Doug, your line is open. Please go ahead.

I want to ask a couple of questions on equipment. So revenue continues to lag expectations despite improving order trends and a growing backlog. Olivier or Jason, can you just describe what's driving that disconnect? Is it customer project delays, delivery timing? And any other factors that are worth calling out? And then can you talk a little bit about book-to-bill and how much of the backlog represents committed orders with defined delivery schedules. I'm really trying to get at how much visibility and essentially, what needs to happen for conversion into revenue to occur as we think about 2027?

Yes. Doug, so I'll start just by repeating. We had the highest order intake of capital equipment in quarter 3 of this year since 2021. And this is not like a light statement. I mean, it's something we've been waiting for a long time, and we think that that's really setting us up for a really great year 2027. We already know today end of October of '26 that we're going to enter into '27 with a much stronger equipment backlog than we had when we entered in 2026. So that's definitely really something we're very extremely happy about.

The other good news is we don't think the equipment tap has really opened yet. I mean, if you think about it, we've been hoping to see it opening more than we have seen it so far. But even with the tap probably being only 5%, 10% open, we've managed to deliver the highest quarter for the ever in the history of Repligen. So it means like when the tap finally opens it's going to be really potentially gigantic for all of us here in the industry, and we are really looking forward to it.

So as far as revenue recognition are concerned, I mean, it's good and bad. I mean, we probably won't recognize a lot of it this year. But it's all sitting in 2027. So all of these orders that we've gotten so far, they are all going to be recognized in 2027. So it doesn't go beyond.

And to your question, if this is making you being delayed, the answer is yes, absolutely. I got the highest funnel even after all of these orders, we still have the highest funnel we ever had on the equipment side. What is still not completely there is a velocity of decision-making, the speed which customers really push a button of an order. But the funnel is very high. The order intake has been at the highest level. So we're still very confident about what's coming next. We want the tap to open more, that's the only piece here.

Your next question comes from the line of Casey Woodring with JPMorgan. Casey, your line is open. Please go ahead.

Great. I just wanted to clarify the '27 comments you made earlier. I guess, what's the implied organic growth rate you're assuming? Or maybe asked another way, what do you expect as far as M&A contribution from BioLife in '27? Just been trying to pin down where you expect organic to land next year.

And then I guess on your assumption of the high single-digit market growth rate for next year, that's the same you're assuming for this year. Things seem to be improving from an underlying perspective. So I guess the question there is just how conservative is that end market view from your perspective and what could drive upside to that?

Yes, Casey. So let me start with the first part of the question. We -- that framework is not a formal guidance for 2027. And you know that very well. We're only giving guidance towards the end of February and then we are aiming to do the same this year again. But we just wanted to highlight the very strong reported growth we are going to experience next year with the acquisition of BioLife and the fact we're going to exceed USD 1 billion sales ratio in 2027. That's a really big milestone for our company. I mean, obviously, who would have thought Repligen would be above USD 1 billion back a couple of years ago. So -- and that's really why we decided to provide that data point.

We are still going through budget exercise right now and bear with us. I mean, we've only consolidated BioLife now for about 20 days or so. And so we're still learning about the business and figuring out exactly how will 2027 play out.

What that remains exactly the same as before is we are still aiming to outpace market growth by more than 500 basis points, which, by the way, we've done the whole of 2025, and we are very close to the 500 basis points above market in 2026. Even though we said with the headwind we had, we might be only 300 basis points above that. So that's really staying exactly the same for next year.

As far as the market -- overall market growth is concerned, I mean, we are just watching and listening to what people say right now. And it's fair to say like, at this stage, people are pretty careful about how will 2027 play out. I think there are two big swing factors for the market growth, Casey, next year around. The first one is really going to be capital equipment pickup. I mean -- and again, even though we had a fantastic order intake in quarter 3, has just mentioned to Doug, I mean we really want to see the tap opening much more fully than we've seen right now. That could be a huge swing factor for the overall market growth.

And the second one I would just mention is probably the approval. I mean this year has played out pretty nicely so far on the cell and gene therapy side. It's a little bit lower on the monoclonal antibody side and biosimilars. So I've always said, we want to see more FDA approval, and that could be another big swing factor for 2027.

Your next question comes from the line of Puneet Souda with Leerink Partners. Puneet, your line is open. Please go ahead.

I'll keep it to one. Just on key topic around onshoring. Wondering, Olivier, anything in the order book that you're seeing suggesting onshoring contribution right now? What's the latest thought on that? And how do you think that plays out in '27 for you?

Yes, thanks for the question, Puneet. I think you heard us saying we've won several RFPs so far this year, which for us is a great sign because we didn't even have a seat at the table back a year ago. We won 1 RFP in quarter 1, 1 RFP in quarter 2 and 2 RFPs in quarter 3, close to 3. In fact, we didn't count #3 because it was more going on the analytical side of the hardware portfolio. But anyway, so we've won several RFPs.

Now the question is, are they all onshoring related or not. And I'll tell you, they're opening sometimes it's a little bit difficult to pinpoint, yes, this is onshoring or this is just something that would have happened anyway. I can still tell you like I don't think we've seen the beginning of the onshoring project potential that I'm absolutely convinced we're going to see over the next few years now.

When we entered in 2026, I really thought we would see a lot of those RFPs that are purely onshoring related coming our way, and we've probably only seen very few of these. I do still believe we are going to see many more coming, once our customers are become -- companies feel a bit more confident about how to split their capital between U.S., Europe and Asia. And I really think this is going to come sooner than later now. So still very bullish about it. it's fair to say we are probably 9 to 12 months delayed versus what I thought we would be today. But certainly RFPs coming next year, orders probably next year, and certainly some deliveries towards the end of next year and mostly in '28 and beyond year.

Your next question comes from the line of Dan Leonard with RBC Capital.

I was hoping you could talk more about biosimilars as a growth driver. We just saw the first biosimilar for KEYTRUDA filed with the FDA. And with that context, can you speak to when the biosimilar inflection might occur for your business? And how do you feel about your wallet share in the biosimilar market more broadly?

Yes. Dan, we are really excited about what's coming on the biosimilar side. And in fact, when you think about ATF, which as you know, has been a little bit more pressure this year with those 2 headwinds with the 2 customers. We've had numerous good news on the ATF side. Well, one of them being like by the end of quarter 3, we had on almost as many new products as many new customers we had for the full year of 2026 -- 2025, sorry. But very importantly, a lot of these are going into biosimilars. And we started to see a really notable pickup in biosimilar for ATF. And that's something we're really excited about, because for the reason you mentioned, there will be a lot of products falling in as a patent cliff over the next 2 to 3 years and to be designed in multiple of this, it's going to be a very nice tailwind for us over the next several years for sure.

Your next question comes from the line of Matt Hewitt with Craig-Hallum.

Congratulations on the strong quarter. I was hoping to touch on the margins a little bit. I think you noted that you're seeing some higher inflationary pressures. And I'm just curious is some of the investment that you're making internally on AI and some of the manufacturing efficiencies that you're investing in, is that a function of looking for ways to offset some of those inflationary pressures? Or how are you addressing that?

Matt, so yes, it's a great question. Again, I think just like everyone else, the overall -- whether you stem it from [ oil ] or overall general inflationary pressures, we certainly have some of that as well. First, I'd say the -- our sourcing team is doing a fantastic job in finding offsets and helping to negotiate and work with suppliers to find the best solution. So that's really our first line of defense on that.

I think, then when you look at that broader overall, how do we expand our gross margin, how do we continue to drive productivity. That's where exactly the efforts that the team has been driving is jumping in, particularly on the AI side, whether it's more, I'll say, intelligent inspections to drive better quality. We've done a lot of work this year, and we'll continue to do next year on automation itself, right, in terms of the advancements that we can generate.

And so the -- we've had a lot of great focus from the manufacturing team to help that broader picture of continuing to drive 100-plus points of gross margin expansion like we target and are doing this year.

And the other great news is that we've added a lot of good IT leadership underneath and behind the manufacturing efforts to again add a different set of technologies, a different way to look at our data infrastructure to drive smarter decision-making and really excited about the progress we've made internally on our overall AI and I'll call it AT -- or IT rather modernization and fit for growth execution. So thanks for the question, Matt.

Your next question comes from the line of Mac Etoch with Stephens. Mac, your line is open. Please go ahead.

Maybe Olivier, sticking with the equipment and maybe one on analytics, just I think recently, you noted that 80% of systems sold over the prior last 3 months has included process analytics up from maybe, call it, 20% to 25% last year. Can you just provide us an update with how that attachment rate is trending in 3Q and what's driving the set up? Is it customer pull-through? Is it integrated solutions bundling, onshoring RFP mix, et cetera?

Yes. Mac, no, we are very excited about what's going on in the analytical side. I mean we had another record quarter, in fact, a record quarter ever for the company with 20% growth. Interestingly enough beyond equipment, we had very strong sales of both consumables but also services. You heard me saying earlier, we are now servicing 38% more of our system versus beginning of this year, and it's still a long runway. So service is going to be really accretive to our growth over the next several years.

But one of the big events really that happened recently for us is the USP Chapter 507 recently recognized our SoloVPE PLUS technology as being really the technology, which is aligned with the official standard to measure protein concentration. And that's a really, really big milestone for us because where we knew people were using our technology mostly say for protein concentration. And as you just alluded to it, this is going to be another big accelerator for the FlowVPX side of the picture, which is really this in-line protein concentration tool that indeed our customers are using now much more broadly than they were a year ago.

And you're right, 75%, 80% of any system we are selling, there is a FlowVPX attach that's one of the other reason why this analytical business has been growing very nicely. And we love it, obviously, a lot because beyond the growth of analytics, this is also enabling us to differentiate ourselves very, very strongly on the equipment side -- downstream equipment side.

And with the upcoming tap opening much more broadly, we think that's going to become a huge differentiating advantage for us. So a lot of great stuff happening on the analytical side. I'll just end up by saying, as you know, we are in the upgrade cycle of the SoloVPE installed base, where we've seen quite a lot of upgrade already. We are still pretty much at the beginning of the cycle here. So we are really poised for several other great quarter of our analytical product portfolio.

And finally, on the 908 side, where I was always open saying the integration has taken us more time than probably expected initially, we are now really running full speed and our funnel of opportunity has increased by 50% in the beginning of the year. So this should be another really nice tailwind for our analytical business in 2027 and beyond as well.

Your next question comes from the line of Justin Bowers with Deutsche Bank.

So Olivier, just sticking with PAT, it sounds -- can you refresh us on the opportunity for -- in terms of the replacement cycle for Flow? And then part two, is just -- it sounds like systems are the primary driver of the filtration revisions. Can you discuss how the consumables piece of the franchise is performing this year?

Yes. So on PAT, I kind of already answered quite a bit of your question with Mac earlier. I mean, we think -- I made the analogy to the iPhone when the first iPhone was launched with a camera, where nobody really thought why do I need a camera, I have my own camera, it's beautiful and now probably 80% of people buying a new iPhone is because of the better quality of the camera. So I think the analogy is like people didn't really realize there was a tool called FlowVPX that would enable them to measure protein concentration in line.

And this now that says they probably bought 1 or 2 systems over the last 2 to 3 years, they realize that they love it and that this is becoming a really big key differentiator and that now they would not even imagine probably running a system without having the ability to measure protein concentration live.

So according to that, this is becoming really a big differentiator for us.

And yes, I forgot the second half of your question, can you repeat again?

Yes. It was just around filtration. It sounds like the systems are coming in a little wider than what your expectations were. So just trying to understand how the consumables piece is trending versus expectations and how that's performing this year.

Yes. No. So...

And some of the anticipated headwinds.

Yes, exactly. So the two are somewhat linked to each other. Justin, if you think about it, I mean, particularly on the ATF side, I mean, if people delay buying equipment and so on, then you might have a little bit less of the flow of new consumable coming in. So where the flow of consumable from existing product that have been either on the market, commercialized or in late phase is at a good level, it's fair to assume like there was less hardware installed over the last 6 to 12 months and probably less new consumable order coming from this lack of new hardware.

But as I mentioned earlier, in the first 9 months of the year, we got as many new customers/new application wins as we had for the full year of 2025. So I'm really very confident that we're going to be back to very nice growth trend for ATF from '27 onwards.

And then outside of ATF, we had a pretty good performance of our flagship cassette business, which is probably one of the few areas where we really have direct competition, not a lot of differentiation, and it's fair to say we are gaining market share on that side because that part of the business has been doing really well this year.

And then finally, Fluid Management, where the growth overall has been nice. We were probably hoping to see even more growth than we have, which is maybe one of the other factor why filtration finally is a little bit lower than we thought. But from a margin point of view, as you know, Fluid Management margin are quite significantly lower anyway.

Your next question comes from the line of Michael Polark with Wolfe Research. Michael, your line is open. Please go ahead.

I want to better understand the BioLife fourth quarter guidance and what it might suggest for a good 2027 model input. So $24 million for the fourth quarter, you didn't own it for 6 days. So almost a full quarter. The year ago in fourth quarter '25 was about $25 million. So it looks like you're modeling it flat to maybe up a little bit on a full quarter basis. And it had otherwise been a 20% growth asset. So I want to understand, is this just a normal model haircut, hey, you're learning a bunch more. So let's model a little lower than where they were running or is there something specific about that adjustment?

And then the related question is just running into '27, is it -- is the good number for now the $115 million, the current run rate? Or is $135 kind of 20% growth still reasonable for modeling purposes?

Yes, great question. I think we just really need to impress in those first days of October, they were -- they had a lot of shipments in responding to some very specific customer needs. And so on -- on a, I'll say, a run rate basis, there was a disproportionate amount of sales in those first days. And so it really isn't the math of a flat year-over-year. So I would caution you to take that view.

And of course, we'll continue to see how they'll deliver in the fourth quarter and then into next year. Again, I think you're thinking about all the pieces in the right way. We, again, have just owned them for, what do we say, 20 days. And so we're continuing to get our arms around their '27 outlook. Certainly, we have our models and expectations.

But before we finalize the budget and a guide on that, we're going to spend the right time to do it. Again, no change in the view overall, though that, that there'll still be at least $0.05 accretive for us kind of top to bottom on the P&L. So really excited about what we've learned and Olivier highlighted that we're even more excited as we spent more time there and excited about the market. So more to come to talk through that.

And Mike, just to add to what Jason said, with the $24 million plus what they recognized during the first few days of October, plus the quarter 3 results, we are aiming for full year USD 114 million sales for the BioLife business, so which is above the midpoint of the last guidance, Rod gave at the last earnings call, he had for BioLife separated.

Your next question comes from the line of Paul Knight with KeyBanc ahead. Paul, your line is open. Please go ahead.

Olivier, could you talk to the Ecolab renewal? And also looking at this 40% proteins growth, is this to imply that we're now a kind of critical mass of the years of development at that particular product line and 40% could happen again in the quarter or years ahead?

Yes. Paul, yes. So starting with Ecolab, yes, we are indeed very pleased that we have just extended our supply agreement with them. This is really building on the very strong and productive partnership we've had between the 2 companies. I've been with Repligen for the last 3 years, I have to say we're becoming closer and closer, supporting each other, and they have an incredible momentum. So we see a really meaningful opportunity to build on that success in several years ahead of us.

As far as the broader protein franchise is concerned, you heard me saying, and I love all of my 4 big franchises, but this one, I think we've done a stunning job to just reinvent ourselves because where we were a pure OEM supporter of our 3 companies back a few years ago or so, beyond now the Purolite collaboration, we have our own is in our hands very broadly on both growth factors, but also on our own custom catalog resin for non-monoclonal antibody application.

And we've had incredible traction for the last several quarters now. In fact, year-to-date, our protein business has been growing 34%. So we are -- it's still a bit lumpy, which is why quarter 4 will be a little bit more challenging. We have high comp in quarter 4 for protein, but we've got so many opportunities across the entire protein franchise that the next several years are going to be extremely exciting for that franchise here.

We have reached the end of the Q&A session. I will now turn the call back to Olivier Loeillot for closing remarks.

Thank you, Julian, and thank you all for joining us today. We are really very pleased with our record third quarter results. We're also very encouraged by the continued momentum we have across our business. With the addition of BioLife and the strategic investment we are making across our entire portfolio in all regions, we are extremely well positioned to capitalize on the growth opportunities ahead of us.

Thank you again, and have a great day.

This concludes today's call. Thank you for attending. You may now disconnect.

Hi, everyone. Welcome to day 2 of the Wells Fargo Healthcare Conference. Good 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.

And so 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, kind of what the -- what's driving the strong growth for you guys? And maybe any kind of like puts and takes for the quarter?

Yes. No. Thanks for the question, Evan. I mean, 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 portion on tariff refund. So really a great quarter, which has enabled us to increase our guidance for the full year to 10.5% to 13.5%, midpoint at 12% growth, which is exactly what we grew in the first half. I mean 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. I mean, particularly great performance of both analytics and protein as well. which has helped us. I mean I think, protein grew more than 50, analytics more than 30. So this has helped us balancing quite a bit on the lower growth within our filtration. Great performance on margin, and I'm sure you're going to have a 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 are tracking, one being emerging biotech and the other one being new modalities. And as you all know, I mean, there have been a couple of tough years on new modalities. So to see a rebound in new modality market segment for us was really a great signal. And then finally, obviously, very happy with the progress we're making on our strategy here and the acquisition -- the pending acquisition of BioLife obviously is a big milestone for us, and we're very excited about what comes around the corner here.

That's super helpful. Maybe going to that point, I mean, 12% is the midpoint of the guide. You have a couple of discrete headwinds this year. I mean I kind of calculated to be about 400 basis points which really gets you to about 16% underlying. I mean is that a decent way to think about how this -- the business is performing at a fundamental basis? And then I know you're not going to talk about '27, but it is like -- I mean, unless you have some of these one-timers again, is that like where the industry is kind of at right now?

Listen, you're right. I mean we have been piling 2 headwinds this year, one that we -- we knew already a year ago, which was the gene therapy program that has cost us about 2 points of growth in 2026. And then the other one, which was totally unexpected that took place beginning of this year, which we informed Wall Street about, which is a couple of ATF customers, one heavy management of its inventory.

This year, the other one having a delay of implementation of its manufacturing site. So this has indeed added a bit of unexpected pressure to 2026 numbers. We are so glad that we are still managing to deliver the growth we do because it's a testimony indeed. We have that very broad portfolio of products that we've been talking about constantly over the last several years.

So you're also right, Evan. I'm not talking about '27 today. I mean you know what we've been always saying, I mean, we are aiming to outpace market growth by 5 points. And we have such a diversified portfolio of products that, for whatever reason, we get bad news on one side, we were trying and we are managing to compensate on the other side. So that's kind of the story for '27 at this stage.

Got you. And the news, well, 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's really challenging to kind of put numbers around it. But I mean, I think pre-BioLife, new modalities was 16% of sales, mRNA was kind of probably puts it in the low to mid-single-digit range. Just from a high level, is there anything about mRNA production that's 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?

Yes. No, mRNA is a modality we like from a lot of angle. I mean, and first of all, think about it, I mean 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, this is very, very exciting for the entire industry because for bioprocessing company, mRNA is presenting a lot of opportunities. I mean if you look at products, as you ask, I mean, it can start with any type of resin 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. We launched the first catalog product. We launched enabling customers to get rid of the biggest impurity, you're getting an mRNA process, which is a double-stranded RNA. So that's a resin piece.

Then if you have resin, you have to pack resins and very often, those mRNA customers, they have to pack hundreds of columns because it's going into smaller type of populations, batches and so on. So they don't want very often to pack this column themselves. So they use column packing. So that's a great boon for OPUS. Then you had the filters, then you had the fluid management because for fluid -- 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 process are much smaller and so all.

And then finally, PAT technology. So of course, there are a lot of opportunities for suppliers like ours across the board in terms of the portfolio here.

That's great. Another area that we get a lot of questions, BioLife acquisition, obviously, biggest in the company's history. Seemed attractive. I mean, high consumables mix, dominant market share, why did you think that this was the right asset? And particularly, I guess, the questions that we get is like why cell therapy? And I know you've touched on it, but just to -- if you can provide anything there, that would be great.

Yes, sure. I mean, first of all, we did a lot of homework, Evan. I can tell you, we spent like 6, 7 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 trends were, trying to overcome potential risk like the potential emergence of in vivo therapies and so on. So we did that homework first, and then we realized, well, first of all, it's a huge new modality for our customers. 25%, so 1 product out of 4 in the overall funnel pipeline of pharmaceutical -- biopharmaceutical drug today is a cell therapy drug.

And then you have -- today, it's 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. And then secondly, looking at that specific asset, I mean, BioLife has done an amazing job to really differentiate itself. And 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. I mean, on biopreservation media, they are already designed into 18 commercial drugs. They are designed into more than 80% of any Phase II and Phase III drug as well. So we know like there is a lot of tailwind that's going to come in the next few years from the next FDA approval across the board here.

And then finally, I mean 2 things. First of all, there's a little joke. I mean we're going to hit the USD 1 billion number next year, which for a company like Repligen. It's a big milestone for us. I mean we've been -- we've been growing very nicely, as you all know. I don't think there are a lot of people who would have bet that Repligen would be USD 1 billion by 2027 several years ago, and that's a big milestone for us. And one of the reasons why is because we've got that very diversified portfolio of products, but also a very diversified end market approach.

I mean 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.

So across the board really exciting for us. And as we mentioned, it's accretive across the board. I mean I tell you, I've looked at a lot of acquisitions in my career. I've 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.

Yes. And when you look at the synergies we feel like they're pretty straightforward, right? So we called out about $20 million in year 1. Most of that, $15 million of that is in the OpEx side, very much tied to public company costs, leadership costs, right, CEO.

He's being paid pretty well. Yes.

So fortunately, he'll want to find some retirement home here next. And then that leaves us with, I think, again, a lot straightforward synergies on top of the leadership side, there's the redundant public company costs that come with that Board expenses, et cetera. And then 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've shared with. And luckily, we are a supplier of single-use bags, and so we're able to find a path with them to create benefit with that.

So we feel like we've been pretty conservative with the overall modeling, both from the synergies, and we didn't bake any top line synergies in, but we do expect there to be in both directions, right? They're spec'd into several commercial drugs, we are not, right?

So we'll 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. So we love the deal overall. Financials are great.

Yes. I mean just something you said that just kind of struck me. So the synergies going both ways revenue. So if they're in a commercial drug, how easy is that for them to switch to Repligen if you're not in there already, if it's commercial?

I think what Jason wanted to say is, indeed, they are designed into 18 commercial therapy drugs. I don't think we -- are in any of these 18 with the Repligen portfolio.

What I think Jason was alluding to is that's going to open up doors for the Repligen portfolio and maybe not for those commercial drug specifically but more broadly for the pipeline where we might not have had those high-level contact 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 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 200 -- over 200 basis points a year. It's a lot. So how should we think about kind of the trajectory of that? And I think all this was kind of contemplated before Polymem and BioLife. And so how should we think about that goal in light of those changes?

Yes. So you're right. It's a big step in each year. We announced earlier this year the transformation office that we've been executing. So that's the 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-end. So we do see that benefit. Polymem was contemplated within the transformation office. But to your point, certainly, the BioLife acquisition was not -- at this point in time, before we close and build out a consolidated set of financials that we'll share, we really think of that as helping to accelerate that path to the 30%.

So but we'll pull all that together and kind of reprofile how we see it playing out. But 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 in some commercial and sales resources, to really help bolster our top-line growth that we're going to have some of that flexibility. So we're really happy with the trajectory we've had, the discipline that the team has 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 maybe your -- 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, NextGen TFF, you've talked about. But just how important can you talk about this and then say, explain how important that is integrating AI in your portfolio in order to kind of differentiate your offering?

Yes. And I think you phrased it well already in your question, Evan. I mean, it's a 3-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. So trying to be a bit more specific here, in order to use AI, you need data, whatever business you look at, I mean 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, the data. And the data are going to collect from 2 front.

One is going to be on the process development side, and the other one is going to be the manufacturing side. And the only way to collect data right now via PAT technologies. I mean, 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 coming alongside our PAT technologies. In the last 3 months, it went up to 80% in only 3 months.

But I mean, for us, it's extremely encouraging because it's been like those people who have started to embed those PAT technologies have used them and like them 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 have technologies. Only one is in line right now. We are going to work to make sure we get a second and if not the third one in line over the next couple of years.

Then this is what digital twin comes, which is what is digital twin? Digital twin is a software that enable you to kind of try to understand what the data you're collecting means. So are you going to be better at developing a process using a resin? Are you going to be better at running the process under this type of parameters and so on by using this digital twin capabilities, it's giving you a first hit.

And then later on, once you're going to be having a lot of data on with your PAT technologies, once you're going to have used digital twin to become faster at developing our processes and so on, then you're 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 10, 20 batches you manufacture and being able to tell you after 1 hour, that's going to be a good batch, that's going to be a bad batch, and then you can stop it after 1 hour instead of waiting for 2 weeks.

So can you imagine if you are a CDMO, it's a big game changer because, I mean, for CDMO, it's all about the time you used to sell -- to manufacture and sell products, you don't want to run a batch, that's going to be a bad batch. So it's going to be a multiyear journey what's 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. I mean, 50% growth there. I don't think we expect that to be the same going forward. But can you just talk about what you're seeing in that business? And as we think about the long-term growth opportunities there. I mean, how should we be thinking about things?

No. I mean I love all of my franchises. There is one I'm really proud about that, and literally, I mean, Jason and I exactly joined 3 years ago now. And I mean I tell you, when we came maybe literally a few months after we read about our 2 key customers on the protein side who have decided to just stop buying from us completely. So it was like the most horrific scenario you could think about. And we just felt like, hey, what are we going to do? I mean we have just reinvent ourselves and reinvent ourselves 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 an engine, a real innovation engine for both ligand and resin as well with the acquisition of Tantti. And I mean, I have to say it has worked beyond our expectation. I mean it's just happening across the board. I mean, the collaboration with Purolite has been great. I mean, I think in the Ecolab quarter 2 results, even though we collate big companies, they didn't mention that they are getting market share, they are gaining market share on the resin side.

And then on our own resin side, I mean, 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's capable to develop ligand and resin for them in less than 6 months, which is a fraction of the time it takes to the other guys. So we've won a lot of those R&D product development deal over the last 1 to 2 years. and this starts to generate significant sales. And the best is still to come. I mean, it's probably going to still be lumpy. So that's your question about going to be able to deliver 50% growth every quarter? The answer is no.

Is the objective to grow very fast on the protein side over the next 5 to 10 years, absolutely. And we get so many bets across the board, like I think 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's some sign of life in the quarter. Orders are up book-to-bill above one. You talked about a bunch of things. I mean getting a seat at the table, you have two RFPs with maybe another one coming onshoring. And then just fundamentally, you've talked about kind of an underinvestment on the part of the industry, it probably peaked since COVID. So where do you think we are in this? Well, obviously, we're 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?

Evan, let's start with the good news. I mean, we won 1 RFP in Q1, 1 in Q2. We already won 2 in Q3. So where it's still not as fast and as big as I would have thought it would be when we at least, we do have a seat at the table. And 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.

I mean the other flip side of it is not happening probably as fast as all of us would have liked to see it happening. And I know I've been talking about the tap opening sooner or later very strongly. I think it's probably 5% open right now. So even with only 5%, we start to have some good win. I mean, which are going to be mostly delivered in '27. We also we're starting to build a nice backlog for '27 of those hardware deals we're winning?

I think capacity is still to come. I mean, I think we've not seen like probably more than 5%, 10% of what's going to come over the next few years because it's going to be a combination of some of these onshoring big projects becoming more and more in terms of number, but also the urgency now for our CDMOs and pharma customers to really go back to the hardware upgrade cycle that they've been ignoring mostly for the last 3 years.

And technologies are improving. I mean back to the story on PAT, I mean people who have been testing our PAT technologies now for the last 2 to 3 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's going to enable us not to pair it with the PAT technologies that are available. So 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? I mean 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?

I mean it's a combination of multiple factors. I mean you don't grow more than 20% in '25 and midpoint, I think, of our guidance of 25% in 2026 without having multiple reasons for that. I mean 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. So they're seeing it as well.

I think -- and that that's a good sign, by the way, for the bigger CapEx spending because at least to my own experience, very often, where you start to see the beginning of a new cycle with a smaller scale type of equipment, which are easier. I mean your procurement, your finance right, and is going to release funding for small-scale hardware faster than for larger scale so that's another good sign. But it will start with the market getting better. And then obviously, you mentioned the upgrade cycle.

I mean, one of the things we're getting more and more focused on in life cycle management of our product? We never really launched a new version of our product in the past. I mean, 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 terms of what we base 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. And 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, an acquisition, which is like 15, 16 months ago now. I mean it's fair to say the integration has taken us more time and energy than we thought initially, the great news is now everything is in full order, meaning in terms of quality, in terms 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 '27 and beyond.

Yes. They had some good technologies. So 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. I mean, I think historically, I've kind of thought of it as like a low double-digit grower. But how do we kind of get back there?

I mean, again, when we enter in 2026, I have no clue like -- this would be the least performing franchise all. I mean I can guarantee you. I mean, life has taught me that in my 30 years of experience, I mean 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.

So -- and yes, we just piled 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. But anyway, the good news is we start to see a nice rebound on ATF in the last couple of months, but also we are tracking how many new program customer are we winning?

I mean, after 4 months in '26, we had won as many new customer programs as we had in the first 6 months of 2025. So it means like we are still getting more and more customers willing to use and then starting to use ATF. One of the interesting trends we've seen lately is more people using it for smaller scale type of product at first glance was like, "Oh, wow, isn't that surprising?" And maybe we're going to get less consumable, but it also means like 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 kilograms of mAb every year or maybe a metric ton.

I mean now we start to see people using it for processes that only record maybe 100-kilogram of mAb per year which shows you like people are really becoming much broader on it and so on. So that's something we were hoping to see the benefit of very soon. And I mean it's fair to assume like, well, this year, the three other franchises have been the one growing faster and so on. I mean, there is a good chance next year, we're going to see a different setup between the 4 franchises. We are still very bullish on ATF.

And then 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. So if the tap opens, all reasons to be optimistic about next year for filtration.

Maybe just rounding it out going to chromatography. I mean it's been -- I mean 2 straight, very strong years. I've always thought about the differentiation there being just the breadth of the portfolio, small scale to large scale. Maybe that kind of -- 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? And then again, I mean, after 2 strong years, I mean, how should we think about the underlying growth opportunity there?

No, I think, and 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. I mean why would you need to have, and 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 1, month 3, month 12 or whatever.

That's partly the case for CDMOs because CDMOs that they really don't know exactly what product they are going to manufacture quarter-by-quarter. They want to have their prepack 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, realize they've lost the expertise as well because, I mean, when I started my carrier, I mean, very often people were starting their carrier packing columns, and then they would do that their entire life.

And now I can promise you the new generation and so on. I mean they're going to do colon packing for a year, 2 years and so on, then they want to do something else. And column packing, it's a real art. You need experience, knowledge and those pharma companies realize they have a lot of losses of product because people are losing expertise, and that's going to benefit us for the next several years.

And the good news is it's only a fraction of the total column packing market that is using prepacked column today. So there is still a lot of traction here for sure.

Great. China, APAC, 40% in 2Q. I think China is up 60% in the first half. I mean, is this mostly China, CDMOs in South Korea, where are you seeing within your portfolio, the most demand? And then also, you signed this OEM relationship recently in the area in the region. How does this -- what does it let you do that you really couldn't do before?

Listen, I'll be humble for once. I mean we're starting from a really low point. I mean, there is one business that has not been doing well at all for the company for the last 5 years or so. Is it really our business in China? And then I've said it very openly. I think we've lost market share to a lot of local company over the last 5 years. So we are working on 2 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. I mean back to resin.

I mean, we interestingly enough, we get a lot of design-in win with some of the resin we put on our shelves in the last 2 to 3 years for companies that are very heavy on the new modality side. So it's a mix of reclaiming and market share loss and then gaining market share on some of the products we didn't have on the portfolio before.

Okay. And the OEM relationship?

Yes. No, it's progressing very well. I mean we are on a flight to China, Jason and I, on Friday night, to visit our OEM partner and discuss the next steps together. We're going to start with them manufacturing some of our filters to start with. And we've got multiple other projects that we're going to talk about together.

Cool. Probably have time for one more question. Got a couple here. One -- so actually, there's I think if we went back 4, 5 months, maybe 6 months ago, people thought that ATF was doomed competitor was coming out with a new product. And now, we just don't really hear about it. But it's funny, I mean, I got this 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 it instead of ATF, it uses TFF, is that correct? So in terms of the different technologies, and I assume they're using a very similar technology with some upgrades, like what is the difference between using TFF for versus ATF?

Yes, I mean -- and we've said that also very openly. I mean, the only real competitor we have to ATF is TFF. So when I joined 3 years ago, I realized we have both. So I said, why are we like maybe working a little bit too much in silos, where we are so obsessed by ATFs that if a TFF one comes, we don't even consider it, and we're trying to convince people to do ATF/TFF.

So first of all, when I joined, there were 3 pharma companies that were still not using ATF, now we are down to only one. I mean it means two of the three that were like TFF/TFFs, they've moved also to ATF in the meantime. And then any time and it's 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're bidding, we're winning. I mean -- so I don't think we've missed a single process intensification over the last 2 years, 3 years I've been here, and 90% of the case, 95% is ATF and then the 5%, 10% TFF winning it with our own equipment as well.

And so from that point of view, and again, I don't want to feel complacent because I tell you, I'm totally worried about what might happen every day and then pushing my team to make sure we're monitoring what's happening. Today, we've got the luxury that we don't have any competition at all. I mean it's going to come one day for sure. And going to get ready. We are very heavy on R&D, as you know, and we're already working on the next-generation ATF system that we hope to launch probably in about 15 to 18 months from now or so.

Great. No time left, perfect timing. Thank you so much for joining us. That's a great conversation.

Thank you.

Thank you very much. Thank you.

Hello, everyone. Thank you for joining us, and welcome to the Repligen Q2 2026 Earnings Call. [Operator Instructions] I would now like to turn the call over to your host for today's call, Jacob Johnson, Vice President of Investor Relations for Repligen.

Thank you, operator, and welcome, everyone, to our 2026 Second Quarter Report. On this call, we will cover business highlights and financial performance for the 3-month period ended June 30, 2026, and will provide financial guidance for the full year 2026.

Joining us on the call today are Repligen's President and Chief Executive Officer, Olivier Loeillot; and our Chief Financial Officer, Jason Garland.

As a reminder, the forward-looking statements that we make during this call including those regarding our business goals and expectations for the financial performance of the company are subject to risks and uncertainties that may cause actual events or results to differ. Additional information concerning risks related to our business is included in our quarterly reports on Form 10-Q, our annual report on Form 10-K and our current reports, including the Form 8-K that we are filing today, and other filings that we make with the Securities and Exchange Commission.

Today's comments reflect management's current views, which could change as a result of new information, future events or otherwise. The company does not oblige or commit itself to update forward-looking statements, except as required by law. During this call, we are providing non-GAAP financial results and guidance unless otherwise noted. Reconciliations of GAAP to non-GAAP financial measures are included in the press release that we issued morning, which is posted to Repligen's website and on sec.gov, along with our earnings supplemental, which is posted to Repligen's website.

Adjusted non-GAAP figures in today's report include the following: organic revenue and/or revenue growth, cost of goods sold, gross profit and gross margin, operating expenses, including R&D and SG&A, income from operations and operating margin, other income or expense, tax rate on pretax income, net income, diluted earnings per share, EBITDA, adjusted EBITDA and adjusted EBITDA margin. These adjusted financial measures should not be viewed as an alternative to GAAP measures but are intended to best reflect the performance of our ongoing operations. With that, I'll turn the call over to Olivier.

Thank you, Jacob. Good morning, everyone, and welcome to our 2026 Second Quarter Call. Once again, we delivered excellent results in the second quarter. Our team executed at a high level driving 12% reported growth, which translated to 13% organic growth and 460 basis points of adjusted operating margin expansion.

Reflecting on our strong first half results, and with our increased conviction in the full year outlook while raising our organic revenue growth and adjusted EPS guidance. At the midpoint, this represents a full 1% increase to our organic growth expectations and $0.05 to adjusted EPS. In addition to our excellent first half results, we see several reasons for our increased confidence in our end markets and revenue outlook.

First, the positive order momentum that emerged late in the first quarter carried into the second quarter including an improvement in ATF order trends. Second, while capital equipment revenue remains muted. We saw a sequential step-up in orders and won another important RFP. Year-over-year, our funnel remains very healthy, and we are increasingly convinced that capital equipment tap will open further in the not-too-distant future. And finally, emerging biotech grew high teens even against a high comparison, a clear sign this customer base is recovering in a sustainable manner, and we are seeing the translation of an improving funding environment.

In the second quarter, we delivered $204 million of revenue, driven by healthy recurring revenue growth across our broad portfolio. Proteins led away with an impressive 50% growth while analytics demand remained extremely strong with 30% plus growth in the quarter. Consumables, including proteins, grew high teens, while services grew over 20%. Capital equipment revenue was stable between Q1 and Q2, and we saw a significant sequential pickup in orders, though revenues declined slightly year-over-year. Still, our capital equipment revenue grew high single digits in the first half.

Across geographies, APAC led the way with approximately 40% revenue growth, while North America was also strong in the high teens. The growth in APAC highlights the fact our invigorated strategy continues to create opportunities across the region, and we are pleased to see strong growth from both biopharma and CDMOs in the region.

Our strong first half margin expansion continues to reflect our disciplined operational execution. We continue to be balanced in investing for future growth while managing costs and drive real operational efficiencies in our manufacturing operations. As a result, we remain on track to achieving our target for 30% adjusted EBITDA margin by 2030. In short, our base business remains very strong, as highlighted by 13% organic growth in the second quarter. Our second quarter growth was in part driven by the multiple new product innovation we launched in analytics and proteins in recent years. This is enabling us to outpace market growth.

The definitive agreement to acquire BioLife as an exciting new growth vectors, this financially accretive acquisition fast tracks our cell therapy strategy. I will provide additional thoughts around our strategic effort shortly, but first, some more details on the quarter.

Looking at our performance by end market, CDMO growth remains strong. Biopharma revenue was essentially flat, with strength in North America and Asia, which both grew at least high teens, offset by a difficult prior year comparison in Europe. OEM and integrators were accretive to growth, driven by strength in fluid management and proteins.

As mentioned earlier, emerging biotech revenues grew high teens, which is important as we are now lapping our return to growth last year. We remain encouraged by growth from this customer base and are optimistic we will see a continued recovery given funding trends remain robust.

New modalities grew 9%, excluding the impact of a certain gene therapy headwind. Importantly, this was the best quarter since the first quarter of 2025 and we saw a strong sequential increase across all modalities. We continue to see growth in cell therapy and also in gene therapy when excluding that specific headwind.

Moving to our strategy update. We recently completed our annual strategic planning process. Looking back on our 2025 strat plan, we made great progress on our strategic initiatives including, but not limited to launching multiple innovating products, adding great talent to our team and expanding our margin. Our recently launched transformation office is positioned to start delivering promising business improvements. This year's plan focused on refining our same long-term goals, including outpacing market growth advancing our digital and services capabilities and accelerating growth in Asia Pacific.

We would highlight three areas of heightened focus in this year's strat plan. First, we recently launched our integrated solution strategy. We believe now is the right time to launch this initiative given the upcoming onshoring opportunities. This team will focus on cross-selling our entire A to Z offering under a formal integrated solutions team. While our key accounts team has focused on selling our full suite of solutions, our integrated solution initiative will further these proactive efforts to increase speed and professionalism while also engaging more directly with engineering firms.

We will initially focus our efforts on ADCs and other new modalities. In particular, with the upcoming acquisition of BioLife, we'll expand the scope of solutions we can offer to the cell therapy market.

Second, our team is increasing its focus on product life cycle management. This effort works to continuously innovate our product portfolio to best address customer needs while ensuring the transition to upgraded solution is a frictionless process. We've seen sizable benefit from this initiative with our SoloVPE PLUS upgrade cycle and we intend to run a similar playbook elsewhere in our portfolio.

Third, the definitive agreement to acquire BioLife based on our strong momentum and commitment to use compelling M&A to drive a credit growth, double down in high-growth markets and create more robust customer solutions.

BioLife fast tracks our cell therapy leadership by adding a differentiated portfolio of products serving this rapidly growing end market.

Following last week's announcement, we received some questions about our interest and view of the cell therapy market. From our analysis of the biologic landscape, it's clear that cell therapy represents a meaningful portion of our customers' focus and investment with this modality representing nearly 1/4 of their clinical pipelines. In our extensive due diligence, we spent time with third-party advisers evaluating the opportunities and risk of this end market.

The analysis increased our conviction in the long-term growth of this industry while helping us to gain comfort around potential risks like further development of in vivo therapies.

A recent white paper from the Alliance for Regenerative Medicine showcased a 170% increase in U.S. treatment centers and a 740% increase in cell and gene therapy U.S. claim from 2018 to 2025. This highlights the growing volume from these modalities.

The accretion of BioLife will enhance our offering for these end markets and provide us with additional opportunities for organic and inorganic growth. It added deeply embedded and highly trusted platform to our portfolio, led by bio-preservation media, which supports 18 commercial therapies. We believe the future combination of our companies will bring important benefits to customers by expanding our robust offering of cell therapy workflow solutions.

Finally, the transaction is financially compelling. It's accretive to our top line growth, our adjusted margin and adjusted EPS. We see at least USD 20 million synergies and $0.05 of adjusted EPS accretion in year 1 with growth to at least $30 million and $0.25, respectively, in year 2.

Before I turn the call over to Jason, I'll provide some more detail on our franchise level performance. I will note that all references to our 2026 expectations are on a reported basis.

Starting with Filtration. Revenue grew slightly on a reported basis in the quarter, driven by consumable demand, including fluid management and flat sheet cassettes offset by the sale of Polymem and the previously disclosed gene therapy headwind. Consistent with our expectations, ATF and systems demand were muted this quarter. As I previously mentioned, we are encouraged by the recent pickup in orders that will start fueling 2027 backlog for both of these product categories. We continue to expect filtration growth of roughly mid-single digits.

Turning to Chromatography. Revenue grew low double digits, lapping our strongest quarter last year. This was again driven by growth in OPUS Columns with continued growth from CDMO and biopharma customers. In particular, we continue to see significant traction with large-scale columns where units have grown 18% in the first half. We continue to expect chromatographic growth of 20% plus for the full year.

We had a phenomenal quarter in proteins with 50% growth, again, driven by strength across our portfolio. We are excited about the portfolio of capabilities we've assembled in our protein franchise. It's encouraging to see how strategy play out in financial results, and we remain focused on seeding opportunities across our protein offerings.

With a strong first half performance and visibility into continued momentum in the second half, we now expect protein growth in the mid-teens for the year.

Our Analytics franchise had another strong quarter with 30% plus growth, including strength across consumables, services and capital equipment. The SoloVPE PLUS upgrade cycle highlights the tangible benefit of our product life cycle management strategy, but it's important to note, we are seeing broad strength in our downstream Analytics business. We continue to believe our digitization and strategy is well positioned for where the industry is going.

Given momentum in downstream demand and a growing contribution throughout the year from our upstream analytics offering, we now expect Analytics growth of at least 25%.

Before I hand over the call over to Jason, I wanted to reiterate that we are very pleased with our second quarter results and our continued momentum in the business. We delivered 13% organic growth in the second quarter. Our team continued to execute effectively on our strategic priorities, outpacing market growth while expanding margin, which enabled us to increase our full year outlook. These are incredibly exciting times at Repligen, and we look forward to welcoming the BioLife team upon the close.

Now I'll turn the call over to Jason for the financial highlights.

Thank you, Olivier, and good morning, everyone. Today, we are happy to share our excellent financial results for the second quarter of 2026. These results in an improving environment have increased our conviction in our 2026 outlook. And with that, we are raising our full year guide. I look forward to sharing the details shortly.

Before we discuss the quarter, let me highlight that unless otherwise noted, all financial measures discussed reflect adjusted non-GAAP measures. As shared in our press release this morning, we delivered strong second quarter revenue of $204 million. This is a reported year-over-year growth of 12% or 13% growth on an organic basis, which excludes the impact of acquisitions, divestitures and foreign exchange.

The previously announced sale of Polymem was a one point headwind to reported growth, while foreign currency was also a slight headwind. For clarity, we did receive tariff refunds in the quarter that were a slight headwind to both reported and organic growth.

As Olivier provided details on our product franchise performance, I'll share more color on our regional performance. Starting with quarterly revenue mix. North America represented approximately 51% of our total. EMEA represented 32% and Asia Pacific and the rest of the world represented approximately 17%. North America grew high teens driven by strength across our franchises and customer base. EMEA declined mid-single digits with strength in analytics, offset by a difficult prior year comparison. Asia Pacific grew a standout 40% and driven by strong growth in pharma and CDMOs supported by continued strength in China.

Transitioning to profit and margins. Our strong first half margin expansion continues to reflect our disciplined operational execution. Second quarter adjusted gross profit was $110 million, and adjusted gross margin was 53.9%. This was 280 basis points of margin expansion versus last year. The year-over-year increase was driven primarily by volume leverage, pricing execution and favorable product mix, all of which more than offset inflation. Tariffs were a modest benefit to our margins in the second quarter. Our full year guidance now assumes minimal impact from tariffs.

Continuing through the P&L, our adjusted income from operations was $34 million in the second quarter up 55% year-over-year on a reported basis. This translated to an adjusted operating margin of 16.7% in the second quarter, which was an increase of 460 basis points year-over-year on a reported basis, including a 40 basis point benefit from the sale of Polymem. Adjusted EBITDA was $43.8 million in the quarter or 21.4% adjusted EBITDA margin.

Underlying our adjusted operating income margin expansion in the quarter with strong operating leverage achieved with a modest adjusted OpEx growth of 6% on a reported basis and 8% excluding the impact from the Polymem sale and foreign currency. We have remained prudent in our spending and have taken a measured approach to head count additions in the first half. To help explain the sequential decline in OpEx and lower year-over-year growth. The quarter was also helped by a transient benefit related to employment compensation costs that were favorable relative to our expectations. We do not expect this benefit to recur in the second half, and therefore, we anticipate OpEx to step up sequentially in the third quarter, driven by spending levels more consistent with the first quarter.

In addition, given recent trends, we do plan to make some investments in the second half of the year to support growth in 2027. We will remain thoughtful about balancing investments in the business and expanding margin.

Moving to the bottom line. Adjusted net income was $31 million, a 45% year-over-year increase. Our second quarter adjusted effective tax rate was 21.5%, and we now expect it to trend towards the lower end of our prior guidance of 22% to 23%. Adjusted fully diluted earnings per share for the second quarter was $0.54 compared to $0.37 in the same period in 2025 or an increase of 46%. We continue to see strong earnings conversion from our robust revenue growth.

Finally, our cash, cash equivalents and marketable securities position at the end of the second quarter was $810 million, up $25 million sequentially from the first quarter. This is driven by $33 million of strong cash flow from operations, primarily offset by $5 million of CapEx in the quarter. We remain focused on optimizing our working capital to drive improved free cash flow.

I will now outline the improved outlook in our adjusted financial guidance. For clarity, our guidance does not include any assumed impact from BioLife as the transaction is expected to close in the fourth quarter following necessary and customary approvals. As Olivier mentioned, we are raising the midpoint of our revenue guidance. We are now guiding $813 million to $834 million of revenue or $824 million at the midpoint. This represents 10% to 13% reported growth or 10.5% to 13.5% organic which is an increase of a full percentage point of organic growth at the midpoint versus our prior guidance. This assumes a couple of million dollars of foreign currency tailwind, offset by approximately one point of headwind from the sale of our Polymem operations we announced last quarter.

From a franchise perspective, our reported growth of 10% to 13% assumes, roughly mid-single-digit growth in Filtration, greater than 20% growth in Chromatography, Proteins growth of mid-teens and 25% plus growth in Analytics. We continue to expect 110 to 160 basis points of gross margin expansion for the year. That said, with our strong first half results, we are raising our adjusted operating income guidance to a range of $128 million to $134 million and our adjusted operating margin guidance of 15.7% to 16%. This implies 190 to 220 basis points of operating margin expansion.

Moving to the income statement. We continue to assume $19 million of adjusted other income while we now assume a tax rate of approximately 22%, as mentioned earlier. Putting this together, we expect adjusted fully diluted earnings per share to be between $2.03 and $2.09, this is up $0.32 to $0.38 versus 2025 or up 20% at the midpoint. The midpoint reflects a $0.05 increase from our prior guidance.

For visibility to the remaining quarterly cadence, we expect Q3 revenue dollars to increase slightly sequentially. As we highlighted last quarter, we continue to expect Q3 to be the lowest adjusted gross margin quarter for the year. We expect adjusted gross margins to decline sequentially and year-over-year as mix can have an impact in a given quarter.

Subsequently, fourth quarter margin will benefit from volume leverage. As I mentioned, we expect underlying third quarter OpEx to return to levels more consistent with Q1, but it will be higher in total as we expect to make modest investments in the back half of the year to support future growth. The investments will be focused in sales and R&D and continuing to support our Fit for Growth journey, particularly in IT. As a result, we see third quarter operating margin fairly consistent with third quarter of the prior year.

As a quick update, we have seen continued progress in our dedicated transformation office. We continue to develop and implement plans to drive incremental margin expansion, and we'll soon be leveraging the detailed integration playbook developed by the transformation team for BioLife following the transaction closing. As it relates to cash, we expect CapEx spend to continue being approximately 3% to 4% of 2026 revenue.

As we wrap up the call, Olivier and I want to thank our Repligen teammates for delivering an exceptional first half of 2026. Last week's announcement of our definitive agreement to acquire BioLife marks an important step forward in our journey. It fast track our cell therapy strategy and opens a compelling new growth vector for Repligen. We are energized by the momentum across our business and remain firmly focused on executing our strategic priorities.

With that, I will turn the call back to the operator to open the line for questions.

[Operator Instructions] Your first question comes from the line of Matt Larew with William Blair.

A strong quarter that you previewed last week, so the growth wasn't a surprise. But composition of that growth is perhaps a bit different than we expected, both in terms of the segment, strength in Proteins, in particular, and customer class and the strength in emerging biotech.

So would just be curious, how order trends progress throughout Q2 and into the first month of the third quarter across segments and customers? And what that means in terms of your visibility to the guidance range at this point based on those order trends and backlog that you're building?

Yes. Matt, Olivier here. Yes. No, absolutely good question. We are obviously very happy about how order developed over the last several months. You probably remember, we said we saw a really nice order improvement toward the end of quarter 1 and this has kept on going for all of quarter 2, which was really great and really strong pretty much across the board in terms of orders in terms of our different franchises. That's why we came to the conclusion it's really the right time to increase our guidance for the full year, knowing like we are on our end of July, and we've got much better visibility for the full year.

So that's why we decided to move to 10.5% to 13.5% midpoint at 12% growth, which happens to be exactly what we had during the first half, I mean organic growth of 12%, meaning in order to deliver the midpoint of the new guidance, we don't need any acceleration at all.

And then just quickly going through the franchise. Obviously, you mentioned incredible performance on Protein, but also on process Analytics and Chromatography. I want to say -- so the only one that has not been doing fantastic this year is Filtration and that was just expected because all of the headwinds we talked about are all happening in Filtration.

Your next question comes from the line of Dan Arias with Stifel.

Olivier or Jason, on capital equipment, up high singles for the first half of the year. 1Q was the better growth quarter, but I think you mentioned that order activity improved sequentially. So how do you think second half equipment growth sets up as a compare to the first half? And then without -- within that, can you maybe just sort of take a shot at a view on how you think you exit the year on equipment as we start to think about some of the moving parts here for 2027.

So honestly, it was really expected that capital equipment sales would be muted for us in Q2. I want to say like for the first half, our sales of capital equipment up high single digit. But what was really more important for us was to see order really picking up very significantly sequentially our book-to-bill in quarter 2 was really significantly above 1. So what's important is we won a second RFP. Remember, we said we will start to have a seat at the table end of last year, that is the second one. Number 3 is on its way, we should get confirmation within the next few weeks probably.

So we are starting to build a really nice backlog for '27 and we were really excited about that. I mean, some of it might come towards the end of this year, but probably mostly towards the beginning of next year, which is going to set us up for a really strong 2027 on the equipment side.

Your next question comes from the line of Casey Woodring with JPMorgan.

I guess first one, on the 50% protein growth, can you just elaborate on what you saw in the quarter there? Was there a big order or something else that drove the outside strength? And then second question here. On the margin front, you talked a little bit about 3Q margin expectations, but maybe if you could just walk us through the cadence and what's implied as the exit rate for 4Q on the operating line. Curious how much gross margin steps up from the 3Q levels that you talked a little bit about. And then on OpEx, stepping up in the back half, you had the favorable employment compensation costs in the first half and you talked a little bit about growth investments. So maybe just any way to quantify, how should we think about that stepping up in 3Q and then again in 4Q? .

Yes, I'll start by answering the question on protein, and then I'll let Jason comment on the margin side.

So Yes, you said it rightly. I mean it was an incredible quarter for us on the Protein side with growth around 50%. It's really what was driven by strength across the entire portfolio. And remember, couple of years ago also, we said we had to pivot our Protein strategy completely after losing two of our big OEM deals at that point. And the strategy we've put in place is just playing out in a marvelous manner.

And being a little bit more detail. I mean, we've really seen strength from three different sides, on the Protein side. First of all, our OEM partnering with Purolite is doing extremely well. They had a very strong performance in Q2, and we are so happy to partner with them. But also on our own ligand/resin custom development, the Avitide portfolio, we had a tremendous quarter as well. And then finally, on growth factors as well, what was a very strong quarter.

So it's really pretty much across the entire Protein portfolio that we've experienced a very nice growth, which is why we decided to increase the guide to mid-teens for the full year versus low double digits before. And on margin, I'll let Jason answer.

Yes, Casey. So first, let me just highlight and thank the team for such a strong execution that we've been delivering on margin expansion. And so we've had a really strong first half is at the gross margin level and at the operating margin level. When I take a step back, I think we've improved our visibility, and we can make faster, smarter decisions. Manufacturing team is delivering. We're achieving net price, getting volume leverage. And we've been very balanced in our overall OpEx management in terms of making sure that we're investing in the future for growth and our Fit-for-Growth journey as well as again driving that margin expansion.

You saw that we raised our operating margin guide by another 25 bps. That was after 25 bps in the first quarter. So now we're guiding for a full just north of 200 basis points of margin expansion year-over-year. So really excited to see that momentum going.

Again, there is a dynamic first half to second half that you called out. The op margin will be slightly lower in the second half. And some of that's driven by the OpEx that you referenced. But frankly, again, we didn't change the OpEx guide, raised the top line, and so we see that operating leverage falling through.

The second half OpEx that we've called out is going to be a step-up, right, from a run rate. So the third quarter will step up a couple of million from 2Q and then fourth quarter will step up similarly again. And as I highlighted on the call, we'll be really doubling down a little bit of our investments in sales. We've talked about certainly our investments in Asia, some of the technical selling resources we have, the integrated solutions team that we're building and then also in R&D.

So again, but I would put in context that even with that growth in the quarters, OpEx will still be up really only high single digits year-over-year. and again, being less than our top line growth, that's how we achieve that leverage.

Gross margin, just to address that quickly, no change in the guide, still up 135 bps year-over-year. So again, continuing to see that traction. There is a, I'll say, more of a change first half versus second half at the gross margin line than we see at operating margin. And that's primarily driven by mix, right? We probably had about a full point of expansion in the first half on the mix we saw we're still calling to about a neutral mix impact for the year. So that, of course, implies that the second half is going to be the other direction. But again, we've been really happy with what the team has been executing and we'll continue our journey on margin expansion.

Your next question comes from the line of Dan Leonard from RBC.

I'd like to talk a bit more about the topic of order conversion, specifically in light of that comment, Olivier, that you made that Q2 order strength in Filtration fuels your 2027 growth outlook. Did that comment apply to both consumables and equipment? And what are the factors limiting faster conversion?

Yes, it's very much depending from customer preparedness. And that's, as you can imagine, particularly the case for capital equipment, where when you get orders for specific capital equipment investments, you have to make sure that the plant is ready to accommodate delivery of those equipment.

So it's mostly the case for capital equipment. It can be the case sometime for consumable as well. It's a little bit more rare, but that's definitely also sometimes a case where some people like to order their consumable 6 to 12 months in advance, but it's mostly applicable for capital equipment, for sure.

Your next question comes from the line of Brendan Smith with TD Cowen.

Maybe just another follow-up actually on the filtration commentary a bit. I know you mentioned in your prepared remarks, there were some of the headwinds you had previously acknowledged and were expected. So I guess I'm just wondering, as we look at filtration in the second half, should we maybe expect some of these dynamics to be similarly spread between Q3 and Q4? Or is it mostly kind of a Q2 and Q3, but maybe behind you by Q4, maybe kind of any updates on the MAVERICK tuck-in with ATF that could impact some of that this year. Really just trying to understand some of the cadence of that over the next couple of quarters. So any color there would be great.

Yes, of course, as you heard, we had only a slight revenue growth for Filtration in Q2, which, by the way, was driven by pretty strong fluid management and flat sheet cassettes business. what was really encouraging for us was a pickup we've seen in ATF and equipment orders toward the end of the quarter. And then you just said it very rightly, I mean, all of our 2026 headwind happened to be Filtration, unfortunately. I mean it started obviously with the gene therapy program that we faced issue with a year ago now exactly, then we mentioned at the beginning of the year, we had the two headwinds on the ATF customer side, one managing its inventory, the other ones being delayed implementing the new sites. And now on top of it, we sold the Polymem business, which also impacts the reported growth. So we probably will see some impact from those headwinds in quarter 3, and we expect like it should start to normalize somewhat in quarter 4.

And what I'm trying really to say here is we remain very excited about 2027, the growth opportunity that exists across that entire portfolio. Just to be very specific on ATF in first half of 2026, we've won more new programs/customers than we did in the first half of 2026. And in fact, by mid of May already, we had reached a level we reached by the end of June of 2025. So it's really a much higher number which we know is going to set us up for being back to growth very nicely on the ATF side from '27 onwards and for the next several years.

So that's where we are. We kept the guidance roughly mid-single digit again, if you look at all of these headwinds we have, they are piling to almost high single digit. So that's a big game changer obviously, for us this year, and most of these are temporary, as I already mentioned.

Your next question comes from the line of Puneet Souda with Leerink Partners.

First one really on APAC, 40% growth, really strong there. Could you unpack that a bit more? I know China was a big focus for you. How are products? What products are gaining traction there in a fairly competitive market. Maybe just elaborate a bit on that.

And then on the onshoring pre piece, Olivier, how are you thinking about the timing and magnitude of that? I just wanted to get a sense of if you're willing to share anything on 2027 organic growth ex BioLife.

I think I heard three questions. So I will answer probably the first two and anyway, wouldn't comment too much on '27 at this point.

But as far as APAC concern. Yes, it was a fantastic quarter. I mean the 40% growth in the quarter. What was really good. It was across all of Asia. I mean it was not only China. But as you say, very rightly, we have a huge focus on China, China is a great turnaround for us this year. I mean in fact, first half, China grew more than 60%, which we're very, very delighted about.

But the rest of Asia did very well. And as far as what franchises it pretty much across the board really. I would say maybe out of the four, the one that might be a little bit less important right now in Asia is Protein but really Filtration, Chromatography and Process Analytics are really the three critical franchises for us in Asia.

As far as China is concerned, I mean we are very ambitious about the country. As you know, our OEM partnership is advancing as expected. We're hoping to be up and running by beginning of next year to start manufacturing a lot of our filters in China for China, the reason why we are so bullish about China is about 30% of any clinical trial in the world are happening in China, and they are leading the pack on product line like biospecific antibody drug conjugates, cell therapy. I mean, believe it or not 40% of the funnel of cell therapy worldwide is taking place in China. So really, that's about the Asia piece.

As far as onshoring is concerned, I mean, I would say, I mentioned we won a second RFP and probably on the way to win a third one very soon. I mean, we see a lot of opportunities that are coming out there, and we're really obviously very optimistic we'll see some '27 revenues coming out of this. What I think is really important to you want to hear from me is the reason why we are putting in place that integrated solution team right now is to enable us to tackle those apologies better and better. I mean you don't answer a big RFP, a big entering opportunity, the same way answering small bits and pieces of equipment here and there and that's something our team has got some good past experience with and that we are rebuilding right now to make sure we are capable to turn around those type of offering in a very professional manner and then adding as much services and potentially as much consumable as possible into those big opportunities.

So I think we are going to be extremely well set for those opportunities that we see coming more and more, and that should really benefit us currently from '27 onwards here.

Your next question comes from the line of Anna Snopkowski with KeyBanc Capital Markets.

This is Anna Snopkowski on for Paul Knight. I was just wondering if you could walk us through some of the drivers and maybe macro assumptions that will get you to the low end versus the high end of the guide, whether this is equipment versus consumables or yes, different end market assumptions, that would be great.

Good morning, Yes. I mean, obviously, we see a lot of reason why we decided to increase our guidance for the full year. First of all, our incredible execution in the first half. Again, we delivered 12% organic growth in the first half, the midpoint of our new guidance is 12%. So as I mentioned earlier, no need for any specific acceleration to deliver the midpoint of the new guidance here. So we have increasing expectations for protein and analytics in particular, which is why we increased guidance for those two specific businesses.

Now on your question about what could make it going to the upper end or to the lower end? I mean let me start with the lower end stuff, which would really imply softness in the industry which we are actually not seeing today. In fact, you heard me saying what has been really interesting for us to watch in quarter 2 is to see, first of all, the emerging biotech business growing again, high teens for a fifth quarter in a row of tremendous growth on the emerging biotech side, which now means it's a real pattern because comps were much higher. And it means indeed, the money is starting to really reach those people and everybody, everybody in the bioprocessing industry starts to benefit from it.

And then the other stuff that I was really happy about was new modality because we all knew beyond, obviously, the headwind we had on that specific gene therapy program. I mean, it was a little bit of a soft environment for new modality as well. And to senior modality growing close to 10% year-over-year and having a very strong book-to-bill ratio as well make us feel like we start to see a real rebound on that side, which, as you know, is something we have huge potential tailwind out of that.

So in terms of market segment, great improvement, both on the emerging biotech, but also on the new modality side, and in terms of our product line, obviously, big hopes to see protein process analytics, enabling us to deliver even more than what we've seen so far.

To talk about where -- what could bring us to the upper end of the bracket we have, which is what we're hoping to achieve. Obviously, I mean, ATF could really be a big swing factor. I mean, we've seen a nice rebound toward the end of quarter 2. This is being confirmed with early orders in quarter 3, I mean, that could be really helping us to be more towards the upper hand of the bracket than the midpoint or so on. So that's kind of the overall situation, where we are very optimistic about this promising year for us.

Your next question comes from the line of Matt Hewitt with Craig-Hallum Capital Group.

I was hoping you could give us some details on the competitive landscape or environment the second RFP that you noted that you recently won a third that you could potentially win here sooner. Are those competitive displacements? What are you seeing in the competitive environment? Have you seen any changes there? How are you stacking up?

I mean I think I mentioned a few times already, like we did not really have a seat at the table earlier. I mean, and very simple because we built that portfolio of equipment over the years. I mean it's literally only a year ago that we started to have not only our ATF equipment, but we had also our downstream TSF, stance chromatography and more recently, our mixing offering as well.

So now we would say we've got almost of whatever large-scale hardware requirements customers have when they go for expansion. So not only now we have a seat at the table, but at the same time, as you know, we started to pay some of our hardware with our PAT technologies to give our customers really a chance to run their processes they're manufacturing with much more intelligence than before, and that's definitely a big game changer and a big advantage we have that big benefit we are providing to our customers.

So you can call it potentially market share shift or you can call it people looking for different solutions than they were looking for before because we are the only one really being capable to offer those in-line technologies, mostly one today but we are working on adding two more that will be available probably sometime in '27 or '28. So that's really us having a seat at the table as bringing new solutions for customers and us professionalizing the way we answer those answers with the integrated solution team we are putting in place right now.

Your next question comes from the line of Mac Etoch with Stephens, Inc.

Maybe Jason, just one for you and maybe just a little bit of cleanup. I think you mentioned that tariffs were maybe a headwind to 2Q. I just I'd just like to get a sense of how much of an influence that was in the quarter and how that's impacted the guide so far.

Yes. So we actually had a tariff refund in the quarter, so it actually ended up being a good guide to margin, to your point, or pressure to revenue.

So it was about $1 million of revenue headwind we literally got the refunds as of the last day of the quarter. Now I will note that even with that $1 million revenue headwind, we did not adjust that from our organic growth rate. So again, if that hadn't happened, we would have been about, call it, 50 bps higher growth rate, both on an organic and on a reported basis.

In terms of the cost of goods sold, I'll say, associated with the refund. So that was a margin good guy in the quarter. When I think about the total year, I think when we -- in February, we shared that we thought tariffs would be about a 50-point headwind for us. So with some of this refund, that will certainly be lower. It'll still be a slight headwind for us overall, but not quite as much as the 50 bps. So that won't repeat as both the pressure point in the second half of revenue or a good guy in the second half for margins. So I think we've got it sort of dialed in what we know.

Now you see the news as well.You know tariffs get headlines at weekly. So we'll continue to monitor that. But we've built all that into our guide right now.

Your next question comes from the line of Michael Polark with Wolf Research.

I'm going to ask for a little bit of speculation perhaps. So last week, one of the dust-ups in bioprocessing was resin shipment pushout from one of your large peers and Repligen has been clear in ATF. This is a subdued year for growth due to a couple customer timing dynamics reaffirmed to your inventory and sounds like site readiness. And so my question for you, team is, do you think these items are all related similar? I know these are different points in the stack, but similar sites, similar customers. And I'm asking in the spirit of -- to the extent these large kind of order timing -- shipment timing variances are from similar sources. I think maybe we can all develop confidence that comes back in '27 and sets up '27 for maybe a super normal growth year. So that's the topic and I'm curious for your two cents if you think these things are largely related.

I mean we've always been very transparent about the trend we're seeing in our business, which is the reason why as soon as we heard about the potential headwind we had on the ATF side, we talked about it. And we had two of them.

I mean one of them was a customer that told us "we have a pretty significant inventory and you're probably not going to see the call of any order in the whole of 2025 -- sorry, the whole of 2026, you're going to see it probably coming back in '27". And then the other one just sold and for our sites will not be ready before the end of 2026. So from that point of view, you're not going to be the color of consumable orders this year. So as soon as we've seen it, we just mentioned it.

I mean I like to do what we say and that's why we've delivered those 12 quarters in a row of bidding or bidding expectation. This being said, it's very difficult for me to say what others have mentioned is connected to ours. I mean I don't know, all I can say is if anything from our side, we've seen improvement in our business since we heard about those headwind beginning of the year.

Your next question comes from Matt Stanton with Jefferies.

Olivier, maybe to go back to proteins. You raised the guide here for the year mid-teens. Would just be curious to get your thoughts on what market growth is there. If we go back pre-COVID, I think you've been pretty consistently high singles over a long period of time, but not without bouts of pretty lumpy quarter-to-quarter fluctuations. So I would love to just get your view on kind of what market growth is for Proteins for '26.

And then also just the durability of some of the growth drivers you have with Tantti, Avitide some of the innovation there, the partnership with Purolite, how durable is this outgrowth to the market that you're seeing here on the Protein side?

So let me start with the first question on market growth for Protein. So here, it's a great question, by the way. I think you need to look at different subsegment of the Protein market because where you think about products like ligand ratings on one side and probably, to a certain extent, some of the growth factors on the other side, you would say growth has been -- well, let me start maybe first with resin and ligand. I think here, we've always said market growth is anywhere between 8% and 10%. It's fair to assume people are starting to get better and better at using those products. So probably slowly but surely that market has been growing more towards the lower end of that bracket than the higher end.

But then on the other side for upstream, you've got protein like growth factors, cytokines, where they are definitely benefiting a lot lately from these very high sales density processes that are becoming more and more common. So I think you need to really split those two -- that market between those two submarkets rating on one side and then probably upstream growth factors and cytokine on the other side because I think growth factor cytokine had the potential to really grow more towards the to low teens, if not mid-teens over the next several years.

And then if we look at our own business, I mean, yes, we are a bit of a newcomer in the field. We have incredible great traction right now. I mean between a year ago and this year, I have to say what we've been changing a lot is a year ago, people were mostly coming to us for new modality custom ligand, custom resin in that field of new modality now in the last 12 months, we've seen a lot of customers coming to us -- for a much broader range of products that might have been on the market for several decades and where they realized, hey we will never got a chance to get state of the art product to really purify our products in a much more productive manner.

So I think we have a very sustainable growth in front of us on the protein side. In fact, I think the best is still to come because we are still mostly into clinical, early phase or let's say, switching from an existing commercial product to a new one and where people are still running those validation batches and so on. So I really do believe we have an incredible way forward tailwind on the Protein side.

Your next question comes from the line of Subbu Nambi with Guggenheim.

One clarifying question, Olivier. Thank you for sharing all the details on Protein. Is this driven by new modality or biosimilars? And then secondly, if our model is right, the partial offset was Chromatography. Is there anything interesting to unpack in Chromatography, any changes in order patterns or customer behavior?

So I mean I just said earlier, really on the protein side, we are really becoming broader than just focusing on new modalities. I mean, yes, we've had numerous successes on new modality. I mean we launched on AV8, AV9 resin that have got incredible fraction right now. I mean hear from customers that are the best on the market right now.

But beyond new modality, we are working on multiple products that are going into more established products that have been on the market for a long time. Obviously, excluding monoclonal antibody, where we work exclusively with our friend from Purolite.

And then in terms of Chromatography, yes, you're right. I mean we somehow analytics and protein have been doing so well in Q2, like we don't even talk so much about Chromatography, but Chromatography grew again low double digits in the quarter. Quarter 2 of last year was our highest quarter of the year, and we had incredible growth in quarter 2 of last year. So comps were very high I mean we keep on winning a lot of new customers, both pharma and CDMOs. And I feel like today compared to couple or even 3 years ago, when I joined the company, I mean, it sounds like people are really realizing they want to switch towards using Pre-packed Column more and more in the future. And the good news it's only a small fraction of the entire market that is using Pre-packed Column. So we seem to have a lot of traction behind us for the next several years here on that side.

We have reached the end of the Q&A session. I will now turn the call back to Olivier Loeillot for closing remarks.

Thank you so much. And thanks again for joining us today for that earnings quarter 2 session. We're obviously very pleased with our performance that quarter and our continued momentum in the business. Our teams continue to execute very efficiently on all of our strategic priorities, which is why we continue to outpace market growth and expand margin at the same time. The last week at Repligen was incredibly exciting with the announcement on the BioLife side, our team is very energized, and we look forward to catching up with many of you very soon. Thanks.

This concludes today's call. Thank you for attending. You may now disconnect.

Good day, ladies and gentlemen, and welcome to the Repligen Corporation Acquisition of BioLife Solutions Conference Call. My name is Elizabeth, and I will be your coordinator. [Operator Instructions]

I would now like to turn the call over to your host for today's call, Jacob Johnson, Vice President of Investor Relations for Repligen. Please go ahead.

Thank you, Elizabeth, and good morning, everyone. Thanks for joining us on short notice. Earlier today, we announced a definitive agreement to acquire BioLife Solutions. In addition to the press release this morning, we have published a presentation, which we will reference in our remarks. The presentation is available on our Investor Relations website.

Joining us on the call today are Repligen's President and Chief Executive Officer, Olivier Loeillot; and our Chief Financial Officer, Jason Garland.

As a reminder, the forward-looking statements that we make during this call, including those regarding our business goals and expectations for the financial performance of the company, are subject to risks and uncertainties that may cause actual events or results to differ. Additional information concerning risks related to our business is included in our quarterly reports on Form 10-Q, our annual report on Form 10-K and our current reports, including the Form 8-K that we are filing today and other filings that we make with the Securities and Exchange Commission. Today's comments reflect management's current views, which could change as a result of new information, future events or otherwise. The company does not oblige or commit itself to update forward-looking statements, except as required by law.

During this call, we are providing non-GAAP financial results unless otherwise noted. Reconciliations of GAAP to non-GAAP financial measures are included in the press release that we issued this morning, which is posted to Repligen's website and on sec.gov. These adjusted financial measures should not be viewed as an alternative to GAAP measures, but are intended to best reflect the performance of our ongoing operations.

With that, I'll turn the call over to Olivier.

Good morning, everyone. Thank you so much for joining us today as we share some very exciting news about an important milestone in Repligen's journey. We are thrilled to announce that we have signed a definitive agreement to acquire BioLife Solutions for a total consideration of $1.5 billion using 36% of cash, 64% of Repligen common stock. The transaction is well aligned with our strategy and financially compelling.

Before we discuss the acquisition further, I wanted to quickly confirm that our business continued to execute diligently, and we delivered another excellent quarter. We released select preliminary highlights from our second quarter results, headlined by delivering approximately 12% reported and 13% organic revenue growth. We have also continued to operate incredibly well and saw strong year-over-year margin expansion. We continue to deliver and execute on the strategy we have shared. This includes meeting or beating consensus revenue for the past 12 quarters.

As we have always been, we will remain transparent about the trends we see in our business. And as evidenced by our Q2 organic growth, we clearly have momentum, and we remain excited about the back half of the year. We look forward to discussing our second quarter results and our promising 2026 outlook in more detail on our earnings call next Tuesday, July 28.

We are delivering on our strategy and see strong momentum across the business. We will share more next week, but separate from this transaction, our team recently went through our annual strategic planning process, and we remain excited about the growth opportunities that exist across all of our franchises. We are highly confident in our current portfolio and continue to see a path to our expectation of doubling the size of our company over the medium term while expanding margins.

We believe BioLife will complement this momentum. It represents a unique opportunity for us to add a scaled, highly complementary business that is accretive to our financial profile while strategically enriching a new platform for future growth in one of the most attractive end markets in the bioprocessing ecosystem, cell therapy.

Before we discuss the rationale and benefits of this exciting acquisition, as Jacob mentioned, we posted an investor presentation that I will reference during our prepared remarks, starting on Slide 4. This morning, we announced we have signed an agreement to acquire BioLife Solutions for $31 per share or a total enterprise value of approximately $1.5 billion. The consideration is comprised of 64% in Repligen common stock and 36% in cash. The Boards of both companies have unanimously approved the acquisition, and we expect the deal to close in the fourth quarter, subject to regulatory requirements and a BioLife shareholder vote.

For those less familiar with the company, BioLife is headquartered in Bothell, Washington, with sites across the U.S. and Canada. As we perform due diligence, it became apparent the Repligen and BioLife teams have a shared culture of innovation and customer centricity. We are very excited to have BioLife's talented associates join our team upon closing. BioLife generated $96 million of revenue in 2025, which represented 29% pro forma growth.

This growth is driven by BioLife's differentiated offerings, most notably their cryopreservation media, CryoStor, which represents 80% to 85% of the business. In addition, BioLife offers other consumables, including HypoThermosol to preserve cells at refrigerated temperatures, hPL growth factors, CellSeal bags and vials. Further, BioLife's capital equipment revenue includes their Signata feeding machine and ThawSTAR automated thawing system.

We see this acquisition as a one-step adjacency. Our combination with BioLife will add a complementary set of products and customer solutions to our offering in this fast-growing new modality without drifting from our bioprocessing core. Jason will share more details, but the transaction is very attractive financially. We expect it will improve our revenue growth trajectory and margin profile.

And with that, we believe it will be a straightforward integration, including the realization of at least $20 million in year 1 synergies. We expect to deliver immediate adjusted EPS accretion in year 1. Putting this together, we're buying a unique and differentiated asset that helps accelerate our strategic growth with a compelling financial profile. This checks all the boxes of the M&A criteria we have previously outlined.

Moving to Slide 5. We see 4 reasons why we expect BioLife to strengthen our business. First, BioLife fast-tracks our cell therapy leadership by adding a differentiated portfolio of products serving this rapidly growing end market. Our combination expands Repligen's leadership and increases our exposure to one of the fastest-growing biologic modalities. Commercial cell therapies are projected to grow at a 23% CAGR through the end of the decade, and these therapies represent a meaningful portion of our customers' pipeline. BioLife will enhance our offering and provide us with additional opportunities for both organic and inorganic growth.

Second, it adds a deeply embedded and highly trusted platform to our portfolio. BioLife has been a partner to cell therapy developers for over a decade and is seen as a gold standard in cryopreservation. Their differentiated biopreservation media, led by CryoStor, supports 18 commercially approved therapies and the majority of U.S. commercially sponsored cell-based therapy trials. BioLife generates 46% of its revenue from commercial therapies and 98% from high-margin recurring consumables, which creates a sticky recurring revenue base. As you would expect, all of this will enhance Repligen's financial profile.

Third, the future combination of our companies will bring important benefits to customers by expanding our robust offering of cell therapy workflow solutions. BioLife's critical cryopreservation solutions are highly complementary to Repligen's existing offering for the cell therapy market. This will expand our shared customer touchpoints, with Repligen benefiting from BioLife's trusted customer relationships, while BioLife will benefit from Repligen's broad commercial reach, including our growing presence in Asia Pacific. The combination will also accelerate Repligen's plan to launch an integrated solution offering for the cell therapy market to better serve our customer base.

Finally, we expect to see long-term value creation from this deal. As we have done historically, we plan to invest in BioLife to drive innovation and to enhance the customer experience. Given BioLife's margin profile and attractive end markets, this should accelerate our profitable growth. In addition, by adding a new growth vertical, we see the potential for additional accretive M&A opportunities.

I'll turn the call over to Jason to discuss how this acquisition fits with our M&A criteria.

Thanks, Olivier. I want to echo Olivier's excitement about this transaction. This is a unique opportunity for us to add a differentiated and scaled asset that serves a growing end market and is accretive to our financial profile across the board. As you can see on Slide 6, this acquisition fully aligns with the deal criteria we have previously outlined.

First, BioLife brings a highly differentiated offering through its leading cell processing solutions. It is a trusted platform with significant regulatory recognition. This includes their leading biopreservation media platform backed by a proprietary formulation. In addition, BioLife offers a portfolio of cell processing tools like hPL and CellSeal containment solutions, which are used across the cell therapy workflow.

Second, BioLife advances our strategy by strengthening our position in the cell therapy market, providing additional touchpoints and levers to add value for customers. And third, from a financial perspective, this deal checks all the boxes. It is accretive to growth, margins, and year 1 adjusted earnings per share. In addition, we expect a high single-digit ROIC over the medium term. This is backed by a sizable synergy opportunity.

Thanks, Jason. Moving to Slide 7. We want to share our view of how important the cell therapy modality is to the bioprocessing industry and why we see this as such a rapidly growing end market. We recognize that development of the new modality market has not always been linear, but there are clear reasons for optimism as it relates to the cell therapy end market.

If you look at the pipeline, there are more than 1,100 global cell therapies in clinical trials currently. This makes cell therapy the second largest biologic modality behind traditional proteins and antibodies. Following acquisition close, our pro forma new modalities exposure will be approximately 25%, of which half will be cell therapy. That said, new modalities currently represent 50% of our customer pipeline. Cell therapies represent 22% of the overall biopharma customer pipelines.

We see strong growth from this end market in coming years, given commercial demand is forecasted to grow at a 23% CAGR through the end of this decade, driven by strong efficacy data, including the potential for additional approvals. In fact, there are already 3 cell therapies that are generating over $1 billion in annual revenue. As I previously mentioned, there is a robust development pipeline, creating an additional opportunity as these customers move through the clinical trial process.

Therapies are moving to earlier lines of treatment, opening up larger patient populations. And some of these cell therapies are seeing approvals across a growing number of indications and geographies, further increasing volumes. This also includes the potential for larger volumes from allogeneic therapies and indications for larger patient populations. Finally, there are regulatory changes that are reducing barriers and increasing access for patients. This is an incredibly exciting market, and we are well positioned to play a larger role in the development of this innovative modality.

As you follow the presentation, we'd like to now discuss how this combination will benefit customers with an expanded and broader offering for the cell therapy workflow. On Page 8, we highlight how BioLife complements our existing solutions for the cell therapy market. Today, we at Repligen offer solutions for this market across our portfolio, including ATF and fluid management in filtration, resins and growth factors in proteins, and our upstream analytics capabilities. BioLife will complement these existing solutions.

Further, we will continue to innovate for customers by leveraging our common scientific and commercial expertise in the cell therapy workflow. In addition, we plan to keep investing in BioLife's product portfolio to best serve our customers. While not a meaningful driver of our assumed accretion, we have identified revenue synergies from the deal. Most notably, we see cross-selling opportunities given our overlapping customer base.

Repligen will benefit from BioLife's trusted customer relationships, while BioLife will benefit from our exceptional commercial team's broad reach, including a lot of opportunities in Asia Pacific. We also see this combination accelerating our plan to launch an integrated solutions offering for cell therapy. As we will discuss more next week, we recently launched this initiative for the antibody-drug conjugate end market, and we look forward to building this capability in cell therapy as well.

Finally, this acquisition gives us a platform to further expand our presence in this market. We believe this is a multibillion-dollar addressable market, and we have identified multiple other areas of interest. This includes, but is not limited to, cytokines, where BioLife has announced a multiyear supply agreement with a partner. We believe the strategic fit of this transaction is undeniable.

Let me hand the call over to Jason to discuss the financials of the deal, and I'll be back shortly to wrap the discussion.

Thanks, Olivier. Slide 9 helps frame our thinking around the overall deal terms. We believe we have structured the transaction to mutually benefit both companies. The deal values BioLife at $31 per share. The consideration will consist of an $11.25 per share cash component and 0.1442 Repligen common shares per 1 BioLife share. This translates to $564 million of cash that would be funded with cash on hand. The equity component will result in the issuance of 7.2 million Repligen shares. This represents a $1.5 billion enterprise value or 11x 2027 consensus revenue, and a compelling enterprise value to EBITDA multiple when fully synergized. We believe this reflects BioLife's unique value proposition, while also being accretive to our shareholders.

For Repligen, the structure allows us to preserve balance sheet flexibility for further investment as we will have more than $300 million of pro forma cash following the deal closing, representing approximately 1x net leverage. Finally, as Olivier has underscored, we believe that it is a financially compelling transaction as it is accretive to our revenue growth, our margins, and we expect to achieve 1-year adjusted earnings per share accretion.

On the top line, our deal model assumes BioLife is accretive to our medium-term growth algorithm. BioLife grew 25% in the first quarter. And as included in the press release this morning, BioLife has also pre-released strong second quarter revenue growth of 21%. Longer term, the cell therapy market is expected to grow greater than 20% through the end of the decade. As our deal model only assumes limited revenue synergies, we see this as potential upside when we begin cross-selling and expanding our opportunity in Asia Pacific.

Moving to margins. BioLife will be immediately accretive to our adjusted gross margin at closing. BioLife's adjusted EBITDA margin as reported for 2025 was 26%, which excludes the burden of stock-based compensation. As recalculated to align with Repligen's presentation, adjusted EBITDA margin was 4%. When we account for year 1 synergies, we would expect a 2025 pro forma view of approximately 25% adjusted EBITDA margin for BioLife, and we see this growing over time as we further realize synergies and volume leverage.

As it relates to synergies, we expect at least $20 million in year 1, which increases to more than $30 million in year 2. This is composed of public company and G&A cost savings, along with supply chain and manufacturing efficiencies. The public company and G&A savings are straightforward, so I want to spend a minute on the supply chain and manufacturing efficiencies. As BioLife has mentioned publicly, they have faced some margin headwinds associated with their manufacturing process. Given our operations experience, we have the ability to support the improvement of their yield.

Beyond this, we see the opportunity to leverage our internal capabilities and collaborate with suppliers to generate further gross margin improvement once the deal closes. This represents a double-digit million annual synergy, which we expect to fully realize over 3 years. Putting this all together, we see at least $0.05 of adjusted earnings per share accretion in year 1 and more than $0.25 in year 2.

Though this deal is larger than we have executed in the past, we have a clear plan to deliver the straightforward synergies we have outlined and a plan to fully integrate over the next 12 to 24 months following the deal close. We are confident we have the team and a playbook to manage a successful integration, aided by the fact that as a public company, BioLife has built strong processes and procedures.

Now I'll turn the call back to Olivier for closing comments.

Thanks, Jason. In closing, on Slide 11, we want to leave you with the following thoughts. First, the acquisition of BioLife fast-tracks our leadership position in cell therapy. This is a rapidly growing market and a meaningful portion of our customers' pipelines. Second, it adds a deeply embedded trusted platform to our portfolio. BioLife has a highly differentiated portfolio of cell processing tools for the cell therapy market. This is a unique opportunity, a scaled asset that meets all of our deal criteria.

Third, BioLife is a market leader, which provides an opportunity for us to combine our commercial relationships and R&D engine for future growth. In addition, it adds a new growth vector, which we can further add to over time. And finally, the transaction is financially compelling. It's accretive to our growth, our margins, and year 1 adjusted EPS with very straightforward synergies. We're excited to announce the addition of this growth vertical to our strong foundation. We look forward to discussing our Q2 results next week.

Operator, please open the line for questions.

[Operator Instructions] Your first question comes from Mac Etoch with Stephens Inc.

Congratulations on the transaction. Just one for me. Just given BioLife's broad penetration across cell therapy programs and commercial therapies, how meaningful of an opportunity is it to use those customer relationships to expand the adoption of Repligen's existing bioprocessing portfolio?

Mac, that's a really excellent question. And I think we said that a couple of times in the script today that we are really going to benefit from each other's contacts in the industry because where, obviously, Repligen has a much bigger sales organization than BioLife does, these guys have been really working with all of these cell therapy companies for more than a decade now. And with the track record on the regulatory side they have, they've built really a lot of trust with those big cell therapy customers, including as well the smaller ones. So I think we're really going to benefit from each other quite a bit.

We are really going to build a portfolio of cell therapy bioprocessing tools that's going to be really broad, Mac. And I mean, we mentioned like we are about to put in place an integrated solutions offering for cell therapy. When you're combining what they have and what we have, we're probably going to have one of the broadest, if not the broadest, overall solutions for the cell therapy market. So we are going to open each other's doors at some specific accounts. We are going to also combine our portfolio together that will give us a real great story for those very important customers of both of us here.

Your next question comes from the line of Anna Snopkowski with KeyBanc Capital Markets.

This is Anna Snopkowski on for Paul Knight. Congrats on the acquisition. Maybe just a follow-up of the last question. On the cross-selling side, which Repligen products in particular do you think are most likely to be bundled with BioLife offerings? Would it be like the specialty resins or maybe ATF? And then do you think you have now an end-to-end portfolio on the cell therapy side? And if not, what gaps remain there?

Yes. No, I think it's really pretty much across the board. If I would have to pick up among all the products we have in our portfolio that I mentioned earlier, I would probably pick up fluid management first. And when you think about it, there is a bunch of single-use components that are being used for the manufacturing of cell therapies. And in fact, I think Jason mentioned it earlier, I mean, one of the challenges BioLife had recently was switching from some of their bottle customers to bag customers where they had some specific quality issues. So we're also going to be able to leverage our knowledge in the field to help on that side very heavily.

But for customers specifically, and BioLife has done an amazing job to develop also very interesting solutions like CellSeal and a few other products, we're going to have several single-use product opportunities to push across the entire board with those customers. But it's not going to be limited to that. I mean, we're going to tell you next week a little bit more about this integrated solutions business that we are putting in place. We started doing it with antibody-drug conjugates a few months ago. Now that we've got both the BioLife and the Repligen offering together, we are going to speed up accelerating that integrated solutions offering for customers on the cell therapy side, and it's going to be about helping them, supporting them for their entire workflow.

And in terms of the gaps we have, yes, we still have some gaps. I mean, we also mentioned like we're going to stay tuned on potential next acquisitions, which is why we love the deal we've made, because we still have a lot of dry powder in the bank account that we want to potentially complement with other parts of the cell therapy portfolio. Whether some more cytokines, whether some more single-use solutions, whether some more technologies that are specific to cell therapies, we're going to figure that out in the next few months and years for sure.

And I just wanted to add for clarity, we mentioned that even with all these cross-selling opportunities, right now, we've been conservative in our model, and we've got limited sales synergy baked in. So we do see this as a strong area of potential upside as we continue forward. We just wanted to get time for the teams to really build out that integration.

Your next question comes from the line of Daniel Markowitz with Evercore ISI.

Congrats on the deal. I'll try the cross-selling synergies question as well. If I look at BioLife, they have really impressive participation on both the commercial therapies and also participation on the clinical trial side. I guess how would you characterize where your participation rate is today, and to use that to help frame where you think these cross-selling synergies could possibly go?

Yes. No, I mean, BioLife has been almost 100% focused to where the cost synergies are.

Daniel, we lost the second half of your question. If you could repeat it, please.

Sorry. I was asking in terms of quantifying it, could this come anywhere near the size of the cost synergies or just framing what the upside opportunity could look like?

Okay. Let me start maybe with the first part, and I'll let Jason tackle the second part. So it's the fact that BioLife has been almost 100% focused on cell therapy. I mean, we have not. I mean, as you know, we are dealing with every single market segment for the biopharma industry and so on. So it's fair to assume like particularly at the earlier phase and so on for where the technology, the processes are being developed, I would imagine the BioLife team had multiple touchpoints over the last decade and so on, and we want to benefit from that very grandly.

One thing I'd like to mention is BioLife is very well known for their biopreservation media. They have a lot of other very interesting products. And I just mentioned a couple of them. I mean, the hPL one, the human platelet lysate, it's a culture supplement that is derived from human blood, and that is kind of continuing to be a growth factor, which is slowly but surely replacing fetal bovine serum. And I mean, we are very excited about that, because we know, and I've been in that business for quite a while in my past life. I mean, we know like partly on the cell therapy side, everybody is trying to switch to these types of products.

So BioLife has had multiple touchpoints over the last few years, early phases with those customers. That's going to be a fantastic synergy for us to come and also talk about our technology like ATF, our fluid management product line, and obviously, all of our PAT technologies. As you know, we acquired 908 last year. And I mean, a big chunk of the products from 908 are probably focused on cell therapy. So the synergies for us are actually obvious. As Jason just mentioned, we wanted to -- and also to show you how straightforward the synergies are, we assume like limited sales synergies for the next few years. But I personally assume we have a huge amount of upside on that side. But we wanted to just be a little bit careful on the potential synergies, at least in the short term here.

Yes. I mean, we obviously did an extensive due diligence, but I think we need that time once the deal closes to really build out our broader knowledge and build out the integration plan.

Your next question comes from the line of Matt Hewitt with Craig-Hallum.

Like others, congratulations on the acquisition. You noted, and I think people understand that there's a significant opportunity to grow BioLife's products outside of the U.S. Obviously, just getting this started here. But as you look at it, what is the low-hanging fruit to really drive the growth OUS?

Yes, Matt, I mentioned Asia a couple of times. Asia has always been close to my heart. I mentioned it several times. If there is really one geography where we can help BioLife accelerating their growth, it's definitely going to be in Asia. And then for multiple reasons. First of all, we've had a lot of focus on it now for the last 1.5 years, 2 years with incredible growth, as you know, including China since the beginning of this year. We've got a lot of team on the ground. We've got a lot of customer contacts on the ground. And in Asia, specifically, BioLife always went through distribution.

So obviously, we love distributors, and we're going to make sure the relationship stays very strong with those distributors who have done an amazing job, but we think we can really help each other accelerating the growth by sitting directly with some of these big accounts, partly in China. I mean, I don't know if you all know that, but out of these 1,100 cell therapy products under development, 40% of these drugs are being developed in China right now. So there is a huge opportunity in China, specifically across all of Asia as well, but that's really where we are going to focus our efforts to start with very much. And then again, on the distribution partner side, making sure we support those distributors as well as BioLife and continue to grow together across the entire portfolio here.

Your next question comes from the line of Puneet Souda with Leerink Partners.

First one on the cell therapy end market growth. Could you elaborate your line of sight to cell therapy commercial approvals this year and next? And what upside could we see to that 23% market growth expectation? I'm asking that because, I mean, the commercial volumes of cell therapies are still limited, maybe mid-teens thousands or less than 20,000 annually. And the cost is a significant burden on making these therapies. So I just want to understand how you're thinking about scaling for something that is very costly today, but still has really good efficacy. The data has been good so far, but how are you thinking about scaling?

And then my second question is, congrats on the 13% organic growth here. That was ahead of us on the Street on the quarter. But just wondering, could you talk a little bit about any pushouts or any delays that you're seeing in the market? There was quite a bit of discussion yesterday by a larger peer on the resins portfolio. So just wondering if you're seeing anything that speaks to any pushouts in your portfolio?

So let me start with the second question first. And as you know, we are going to report out our Q2 results on Tuesday next week. So we're going to provide you with a massive amount of detail as we always do. I'd just like to start by saying, we've always been very transparent. And I think, hopefully, people appreciate that. I mean, last quarter, we did say, we did talk about the headwinds we were seeing. And we are delighted to see that we delivered a fantastic quarter 2. So in fact, if you see where we were in quarter 1, where we landed in quarter 2, I mean, we feel even better than we were feeling probably a quarter ago.

And we think we are set for what's going to be a really good year for us across the board. But again, I'll tell you much more next week. I just want to mention because we didn't give the exact numbers, we had a terrific quarter on the margin side as well, which I think is a real testimony to what Jason and the entire team and myself have been doing in the last couple of years, getting fit for growth and making sure we were combining both top-line growth and margin growth at the same time. But we'll give you many more details next week.

In terms of the first question, yes, you're right. I mean, all what you said is absolutely right. We like cell therapy for a lot of different reasons. Let me give you first a couple of numbers that I think we didn't share with you yet. Our cell therapy business grew more than 70% last year. Year-to-date, this year, we're growing more than 20% on the cell therapy side. So that's just a first point for you to understand this business has been growing extremely nicely for us. But what I think is probably more important is there have been 8 approvals last year in 2025 around the world. There have been 8 approvals this year so far in 6 months around the world as well. And the good news is 2 of them are in the U.S.

So I know we are all very U.S.-centric and so on for a lot of good reasons. But outside of the U.S., this market is booming extremely rapidly, and we were so delighted to see a couple of approvals as well so far this year for cell therapy. So that's one other checkpoint. Then, and I can tell you, we did a very deep due diligence. I mean, we've been working on that deal for several months. And when I say several months, it's more than half a year. So we've gone through a lot of exercises to really figuring out the data from every little angle and so on. And we're absolutely confident that the commercial drugs are going to be growing more than 20% over the next 5 years.

The BioLife team has done an amazing job to be designing 7 of the top 8 drugs. And anything you read about those drugs is that the CAGR is going to be around 23% for the next 5 years. And then you've got the funnel of opportunity, which is the second strongest funnel in the industry right after monoclonal antibodies. And I could keep on going, keep on going. But the funnel of our customers, 23% of their funnel is in cell therapy. So we all came to the conclusion, this is a market segment we absolutely need to have a play with a stronger play.

And I would just end up by telling you like with this integrated solutions, we are going to answer the last part of your first question, which is, yes, there are challenges on cost. The more you're going to be able to come with those customers with a really broad solution, workflow solution, the more you're going to be able to help them fixing some of these pricing challenges they have. And that's one of our missions. That's one of the things we're going to be very focused on.

Your next question comes from the line of Matt Stanton with Jefferies.

Maybe I just wanted to go to one of the comments in the deck. You noted pro forma new modalities will be about 25%, and that's a tailwind for above-market growth potential. Just want to clarify, is that above market to cell and gene therapy market or the overall bioprocessing market? Maybe it's both. And then, Olivier, I would love to just get some of your thoughts on the clinical side. I think there's no doubt around commercial cell therapies. But maybe just some views around the clinical side. You have a pretty good view here given you're a strong player on cell therapy already. But what are you baking in, in terms of growth on the clinical side of BioLife's portfolio as that matures in the coming years here?

Yes, absolutely. So to answer to the first question, yes, it's faster than the overall growth of the market. Yes, absolutely. We are actually totally convinced. We've seen it, and we expect it to keep on going for the next several years on that side for sure. And then sorry, can you repeat the second question?

Clinical view.

Yes, clinical view. So I think people start to know me a little bit. I'm trying to be cautious from all angles. And then when I say something, I want to make sure we're going to be able to deliver. So as far as the clinical funnel is concerned, we've taken a bit of a haircut. I've been very honest with you. I mean, we had a very open discussion with the BioLife team and so on and what they included in terms of potential FDA approvals, particularly for the next 3 to 5 years. We've taken a pretty severe haircut to that in our model, which doesn't mean we don't think there will be FDA approvals. We're absolutely convinced there will be several FDA approvals. And again, there has been 2 happening in the first half, and I'm pretty confident there will be a few more coming in the rest of the year. But we've been pretty careful on our assumptions in terms of growth coming out of the clinical trial stuff.

The great news again, and big credit to Rod, Troy, and the entire team there, is they are heavily designed in. I think a couple of quarters ago, Rod mentioned they are in 80% of the Phase III drugs. They are in more than 70% of the Phase I to Phase II drugs. So whatever is going to move forward is going to be extremely accretive to our future growth, and we've been very careful in our modeling for the next 2 to 3 years, particularly with those clinical trials moving forward here.

Your next question comes from Brendan Smith with TD Cowen.

Congrats on the deal. Maybe just following up, Olivier, on your comments about Asia Pacific. And it sounds like you see that as a real opportunity to grow BioLife's business there. I guess I'm just wondering if you expect it to also help grow Repligen's exposure in the region? And then I guess, conversely, if there are other levers maybe in the U.S. and EU that Repligen can pull. I guess kind of zooming out, I'm just wondering if you see opportunities to drive actual share higher for the BioLife business, just kind of given that they're already north of 70%, or probably the lowest hanging fruit is really kind of maximizing geographic exposure opportunity?

Yes. So Asia, absolutely, totally convinced. Again, we are extremely connected. I mean, I brought 2 fantastic leaders, one leader for Global Asia, one leader for China, who know those markets from A to Z and probably the China one, which is why we started to have an incredible turnaround of business since the beginning of this year. So in China, we know like all of the key biotech companies. And I know nobody knows about the big guys, but the top 5, 10 companies who are growing so fast because they are all signing licensing deals with big pharma in the U.S. We've got the introduction there, and we're really going to make sure that we accelerate the pickup of the business, the biopreservation media.

But what I really want to mention again is this is not the entire portfolio of BioLife. And again, I think the team there has done an amazing job to build one of the most comprehensive portfolios. I already mentioned about hPL. They've got this great product called CellSeal, which is sterile containment for closed filling steps and so on, where I think there is a real need. And I mean, having spent time during the due diligence in Bothell and in Indianapolis, we've seen those product lines that are absolutely incredibly innovative and have high potential.

We really truly think we're going to be able to push that in a much stronger manner than obviously the BioLife team could do with the limited amount of commercial resources they have. So talking about synergies on the commercial side, we're really going to be able now to push for the entire portfolio, including hPL, including all of our own products as well as far as we present it as an integrated solution, which is our plan here.

Your next question comes from Matt Larew with William Blair.

This being an acquisition of a larger, more scaled different business is very different than many things that Repligen has done in the past. Of course, ARTeSYN and Spectrum, I think, were kind of mid-30s or $40 million. So some scale, but this is a different acquisition. And I think it requires different operational muscles probably than many of the deals you've done in the past, which are more technology-focused or very early stage, probably limited commercial organizations.

Could you speak to kind of team readiness and perhaps any experience you have with similar deals, obviously, Olivier, your background with GE Life Sciences, Cytiva. And then to that point, maybe, Jason, if you could discuss the cadence of realization of some of the synergies in year 1 and whether there was an attempt to be conservative in sort of posturing to the Street on the cost side in the same way what you're taking on the sales side.

Thanks, Matt. Good to hear from you. So you're right that it's a larger deal than what we've ever done before. But if you compare some of the deals that were done in the past versus the size of the company at that time, in fact, it's probably a little bit smaller than some of the deals that were done initially when Repligen was a much smaller company. But anyway, you're absolutely right, it's a very big deal. It's a very unique deal as well. And that's really what I want to emphasize here again.

It's a very unique deal because it's a very scaled asset and it's accretive to every single financial. I tell you, I mean, I've been in that industry for 30 years. This is the first time in my entire career that I see a deal that is accretive across the board from a top-line growth point of view. And I mean, we are combining like the 2 real growth engines in the industry because we thought we were very good, but these guys are very, very good in terms of growth. So that's the first piece.

Second piece, very accretive from a gross margin point of view. I mean, these guys are about 10 points higher than we are on the gross margin side. And then finally, obviously, this is going down to EBITDA margin and EPS. And I can tell you on the EPS side, I mean, we are delighted to make a deal that is accretive already year 1. I mean, I don't think I've seen many of these deals in my past life. So again, that's very, very interesting from a financial point of view.

Then what I think is probably also very important, and Jason will give you more details about that, but it's a very straightforward deal from 2 angles. It's very straightforward in terms of synergies, but it's also very straightforward in terms of integration. Again, big credit to Rod and the team here, they put in place very good ways of running the business, very well-established processes that will make it really a simple integration for us.

And then before I hand over to Jason on the synergies here more specifically, you heard us talking about getting fit for growth. And then you heard us about putting in place the transformation office. I think you heard us saying like one of these projects on the transformation office is to improve our integration capabilities. And then this we've been working on like for the last 3 to 6 months. I can guarantee we are very well ready to integrate those guys. But Jason, do you want to add on synergies?

Yes. And the only other thing I'd add on the readiness for integration and Fit for Growth journey is we have an incredibly experienced operating team, right? Our COO and all of his team, which, again, I think will bring a great benefit and drive some of this cost of goods sold synergies that we outlined. In terms of cadence, right? Think about with OpEx being about 75%, a lot of that's going to be driven by public company cost savings and G&A.

So again, as you can imagine, there's going to be redundancy in structure with the consolidation into a single public company. So we've already worked and aligned well with the BioLife leadership team. And so the good news is a lot of that will be really day 1, right, so from a cadence, and then we'll continue to execute that through 2027 and then grow those synergies into the following years.

In terms of conservative on cost, yes, absolutely. We've shared our view that we've got clear line of sight. But certainly, we think there's going to be other opportunities that as we dig in and spend more time with the team after closing that we'll be able to identify and find other efficiencies. I think, Brendan, probably some of those happen more year 2-ish time, right, as we have more time to really dig in. But we think we've built out a straightforward synergy plan, both timing-wise and amount that allows for upside as we continue to learn more.

Your next question comes from Michael Polark with Wolfe Research.

I have 2 topics. One on the topic of commercial and clinical mix for BioLife. The deck says 46% of revenue is commercial today. Where might that be in 3 to 5 years as you roll out more approvals and the pipeline matures? That's question one, the commercial clinical mix. And then question 2 is, as I look at their specific products, obviously, 80% to 85% of revenue is CryoStor, 5 other products, collectively 15% to 20%.

What's the total opportunity for those other 5? Are they smaller as a portion of BioLife because they're newer to BioLife and so they're just in earlier stages of the ramp? Or are they smaller because the competitive landscape is different, or they just address the cell therapy workflow in a different way? I'm trying to understand in 3 to 5 years' time, is CryoStor half of this revenue and these other products are the other half because they're going to grow a lot faster? Or no, that might not be the case?

Michael, thanks for the question. So as far as commercial there versus noncommercial, indeed, you're right. They mentioned 46%. I think Rod also mentioned like he's thinking that probably by the end of this year, it's going to be closer to 55%. So I don't know. I mean, we're going to learn much more about the business, obviously, between signing and closing and even more after closing.

What has been experienced too in the bioprocessing arena, I've been now for the last 20 years plus or so, is typically, you're going to move towards being 70-30, maybe 75-25 at some point, whether it's in 3 years, 4 years, 5 years from now, it's difficult to say, but I wouldn't be surprised that what's going to happen for us in the next 3 to 5 years. And as far as the product portfolio, of course, biopreservation media is the biggest chunk of business right now. We are very excited about the rest as well.

And I already mentioned earlier about the hPL products, about CellSeal. I didn't talk so much about Signata and ThawSTAR, which are 2 pieces of hardware that they have. Signata is a benchtop closed fluid management system to automate the liquid handling for cell therapy, where ThawSTAR is helping with the thawing step. I mean, I don't think we've really started scratching the surface, to be honest, with some of these products.

So again, among a lot of reasons why we're excited, we really think like with the integrated solutions team we're going to put in place and combined with our own commercial organization, we're going to be able to duplicate efforts on all of these new products. And I wouldn't be surprised we see higher growth for those products than we do for the [ biopreservation media ]. So it's a good product to have where we know biopreservation media is going to be growing very nicely, that the growth on that side is going to be accretive to our own Repligen growth. I would really think that the rest of the portfolio could grow even faster with us putting much more focus than BioLife had the chance to do so far.

Your next question comes from the line of Dan Leonard with RBC.

Just a clarification on those 2030 targets, Olivier. The goal to double revenue by 2030, this BioLife deal is included in that target and not incremental, correct? So that's the clarification. And then separately, could you just comment on the durability of BioLife's growth rate beyond 2030? You gave the growth of the market through 2030, but longer dated and some of that clinical pipeline is in vivo cell therapies and presumably, that would require different workflows. So I'd just love a few thoughts on the longer-term outlook.

Yes, Dan, great question. So as far as the 2030 doubling target is concerned, this is excluding that deal. So that deal will be incremental to us doubling the business. You might remember, we talked about the doubling last year for the first time, and we said with modest M&A. Obviously, we don't consider this one to be a modest M&A. So this would definitely be incremental to us doubling the business mostly organically with maybe a couple of bolt-ons. So that's the first answer.

In terms of the growth of BioLife, again, I mentioned I'm careful. So you talked about in vivo, and that's a great question. I mean, obviously, there are a lot of talks happening right now about in vivo. I tell you, I'm very, very confident about that. I mean, you might have heard me repeating several times, we see all of these new modalities growing in 2 phases. You've got really the first phase where a new modality comes and everybody is bullish about it, get the same consultants telling them, "Oh, you need to switch 100% to that new modality because nothing else will stay alive for the next decade." And this is why a new modality starts growing very nicely.

And then after 3 years comes the hangover period where people realize, "Oh my God, it's extremely expensive. It's difficult to run clinical trials. It doesn't work as well as we thought it would," and so on. Then you go through that hangover period that can sometimes last like 3 years, 5 years, 10 years, depending on the case and so on. And then you finally enter into the second phase. We are acquiring BioLife at the time I personally think that we have entered into the second phase of cell therapy for probably about a couple of years.

As far as in vivo is concerned, we are just at the early beginning of the first phase. I mean, I think there are only 40 preclinical drugs developed mostly in China right now, by the way. And I think 4 drugs in Phase I, that's it. So I mean, it's very fair to assume it's at least a 10, if not 15-year journey before you're going to start to see in vivo becoming really sizable. And I can guarantee by then, you will still have monoclonal antibodies, you will still have antibody-drug conjugates, you will still have cell and gene therapy, and so on and so on. So we are actually very confident about that.

We have reached the end of our question-and-answer session. I will now turn the call back to Olivier Loeillot for closing remarks.

Thank you. Well, thanks for joining us at very short notice. I mean, you hear us, we are extremely excited. We think it's a fantastic opportunity for the company and for both companies, I should say, and we are really looking forward to welcoming the BioLife team as fast as possible. And we're also very excited about talking to you again next week for our Q2 earnings call. Have a great day. Thanks.

This concludes today's call. Thank you for attending. You may now disconnect.

Good morning, everyone. Thanks for joining us for the Repligen management presentation. My name is Matt Larew. I cover Repligen here at Blair. Very pleased to be joined this morning by Olivier Loeillot who is the CEO of Repligen. Before we get to the presentation, 2 quick things. First, the Richardson room upstairs is where the breakout session will be. And second, for a complete list of research disclosures or potential conflicts of interest, please visit williamblair.com. So again, very pleased to have Repligen here today, and I'll turn it over to Olivier.

Very good. Well, welcome to the Repligen Presentation. You got used to my French accent in the meantime. So that's great. You don't need a translator anymore. So we are going to go through a deck that's going to tell you about the beautiful story of our company. And I think some of you -- most of you know the company already pretty well. But for those who don't know us, we are headquartered in Waltham, Massachusetts. We are a pure bioprocessing play.

Sometimes I hesitate a little bit when we say that because we do have a business on the analytical side. Yes, we do have a little play on the analytical side, but we are really a pure bioprocessing player, about 2,000 people overall. And we've got -- for the vast majority of our manufacturing of our product portfolio, we've got dual-manufacturing siting.

Last year, we did USD 738 million. This year, at midpoint of our guidance, we're going to be in the USD 800-plus million range this year. The word that you will hear me mentioning 20 times today, probably, is innovation. I mean it's really our DNA. I mean we've been growing, thanks to our innovation. We are still very heavy on innovation. And then we love what we have launched.

We love what we're going to be launching over the next several years. So just a few key takeaways. I know sometimes you like the takeaways at the end. I like them at the beginning, so that at least you know what I'm going to be talking to you about today and what I really want you to remember, innovation is really what has given us the right to win and will give us the right to win over the next decade or so.

But we have a very diversified portfolio of products as well. I mean, I remember a year ago, I mean, I had to explain many of you and all of our analysts, we are just not only ATF and OPUS. Interestingly enough, ATF is probably the business that has had the highest amount of headwind in the last 1 year. We've still been managing to grow 16% last year, and we're going to be outpacing market growth again this year.

So we have a really very diversified portfolio of product. But also from a modality point of view, we are just not a new modality. I know last year, oh, you are just a new modality company. No, we are not and we had a big headwind on gene therapy. We still grew 16% last year. We've got a lot of levers to keep on outpacing industry growth. And I mean, even with some of the headwinds we have had, we're still outpacing industry.

So can you imagine how much we would be outpacing if we wouldn't have had all of this headwind we just talked about. And I mean, just to mention a few of the reasons why we can outpace really market growth. The first one is really like we are bringing breakthrough solutions. About 80% of our portfolio, we don't really have competitors. So we are really creating new market segments that didn't exist before.

I mean ATF is a great example, but PAT is another great example where whatever happened with the market, we are still growing because we are creating just new market segments. And we have obviously a commercial-clinical mix that is very different than the other guy. I mean, where the other guys are typically around 75%, 80% of their sales going to commercial drug, it's only 40% of it going into commercial drug. It's increasing. I mean a year ago, it was about 35%, probably 3 years ago, it was about 30%.

And as we are winning more and more design in commercial drugs with both ATF, but more recently with Protein as well, I would imagine that the share of commercial is going to keep on growing significantly over the next few years. The last one I would mention is Asia. I mean, -- we're a little bit supply in Asia. I mean, we did about 17% of our sales in Asia last year.

Most of our competitors are 20% plus. I mean it's a great problem to have probably for somebody like me because I spent a lot of my time in Asia in my career. I think I know that region pretty well. So we are really doubling down in Asia right now to make sure we grow faster. And with the right strategy in each of the country in Asia down there.

Finally, we are obviously working on expanding margin. I mean, you've heard us mentioning several times, we have to get fit for growth and both are linked to each other. And getting fit for growth for me is how do I make sure like we've got the right leadership. We have the right infrastructure, the right software, the right tool to be able to run a business that's going to be $1.5 billion in a few years from now and probably 3,000, 3,500 people or so.

So we spend a lot of time on that, but we're making sure we combine it with improving our margin, which we have. I mean you've seen it happening last year. You've seen it very, very importantly in quarter 1. We are going to really make sure like we are balancing well top line growth versus improving margin. I'm confident we can do both. I mean, which is why we've put in place a transformation office that I'll talk to you a little bit about later on, where really we know that's going to both accelerate top line growth, but at the same time, improve our margin further.

And finally, we are really working on specific strategic priorities. I mean, I already mentioned the transformation office. We signed a very important OEM deal in China. I mean, about a year ago, I want to say, I started to tell some of you, I think the China market will start rebounding really, really fast. I mean it happened even faster than I would have thought, to be honest with you, but we all recognize this market is just booming completely now, and it was really very important for us to articulate a really good strategy down there.

So moving to the next slide, let's focus a little bit on this innovative technologies that are giving us the right to win and defeat competition. So I won't go through the entire portfolio of products we have. But what you're going to see in the next couple of slides, we have a really broad portfolio of products. And when I joined the company about 3 years ago, I was delighted to see that because when I joined what was GE Healthcare Life Sciences in 2010, my task was to build that A-to-Z offering that Cytiva has been really benefiting from a lot in the past several years and so on.

So we have already a very broad portfolio of products. I mean when I show you the workflow later on, I want to say that when you compare to the 4 big guys, we have probably a broader portfolio than 2 of the 4 big guys. There are 2 and one of them is the one I'm coming from, which has got more or less everything and another one probably that has got a bit more than we do, but we have a really broad portfolio of products, meaning the capabilities we have, the opportunities we have to grow are absolutely massive by getting our product really embedded by big, big accounts.

So without entering into too many detailed innovation, we talked about the breadth of the portfolio as well. The one I want to just mention here is really agility with care because the reason why big accounts love us and want to do more with us than with the big guys is because we are more flexible, we are faster. We are obviously very innovative. And that is something we really want to make sure we keep. So in our leadership meeting, we constantly remind ourselves, we are all coming from 1 of the 4 big guys for one reason, which is we don't want to do exactly the way they do business, meaning we want to stay flexible, agile, fast, customer focused and so on, and that's really something we are particularly focused on a daily basis.

Last but not least, I mean, everybody talks about digitization. We do it. I mean we really -- it's not only words. I mean we've got -- we are the only company that has got now 5 PAT technologies. And you've heard me -- some of you have heard me saying, I feel like we're almost like where Google was in 1985 or something like that, where we have the ability now to grab a lot of data from process development, from manufacturing.

We just need now to convince customers to share those data with us and then give them further tool beyond just grabbing the data via PAT technology with digital twin and later on with AI software so that they can develop their processes much faster, but also they can run their manufacturing in a much more efficient manner. So we think we are by far the leader in the field. We are really doubling down right now on PAT so that our customers can collect the data. We're going to try to do our best to make sure we get access to those data as well and then we can help our customers in their digitization journey.

Growth. I mean, you all know we've been growing very nicely. So I know why 2019 to 2025, just because in between, there was a little event called COVID that like screwed up everything. So we kind of realized like instead of explaining without COVID, with COVID that, let's look at where we were before COVID and where we are now because somehow COVID noise is out now because there is no more COVID today, and there was not in 2019. So we really had an 18% CAGR in the last 6 years.

And what's probably more important is look at the right side of that slide where our total addressable market has grown tremendously over the last several years. I mean we have now about USD 13 billion of addressable market, where the total market, I know there are a lot of numbers flowing around is probably around $22 billion, $24 billion. So we've got a big, big play into those markets. And with our sales currently, we probably have about 5% market share. So as you can imagine, we've got massive opportunity to grow on that very big market here.

So what about our broad diversified offering? I mean, this slide, I think, is important to show you what we've been achieving over the last 10 years. I mean, 10 years ago or so, our top 3 customers were 2/3 of our business. So talking about what was a real risky business, I mean, look at where we were 10 years ago. I mean, last year, our top 10 were only 1/3. And in fact, our bigger account last year was only 7% of our total sales. So we have a very diversified customer base.

But probably even more important, look at the franchise column here, where we were just a protein business back 10 years ago. So -- and when I say protein, it was not really protein. I mean, we were just an OEM partner supplying ligands to the 2 big guys in the field, namely GE Healthcare Life Sciences Core Cytiva now and Merck Millipore. We've diversified that product portfolio completely over the last several years.

And look at where we are now where filtration last year was about 55% of our business, but we have 3 more businesses like chromatography, protein, and analytical that are doing very well, growing very, very strongly, particularly during the last several quarters where they've been like skyrocketing each of them and which is great because I would imagine that we will balance our portfolio even more probably over the next 4 to 5 years.

From a modality point of view, we are obviously pretty present on the new modality side. I mean I would have thought we would be higher than 16%. I mean, imagine we wouldn't have had all of the headwind we had on that side and a year ago, particularly on that specific gene therapy program and so on. I mean, everything was well aligned that new modality would be above 20% for us probably in '25 and this year for sure.

I mean I'm still very bullish about it. I mean we just have to bend down a little bit more. I mean -- but think about the fact most Big Pharma funnel today, more than 50% of their funnel is in new modality. So it's just a question of time. I mean, whether it's in the year, whether it's a little bit longer, it's going to come back. We started to see some really positive signal on the gene therapy side.

I mean you've probably seen like there was 2 FDA approval in quarter 1, but no later than yesterday, the FDA has issued a guidance to potentially accelerate new modality -- sorry, gene therapy drug approval, which we hope is going to bring back a lot of optimism on that side. So you'll hear me talking about new modalities for the next several years because we are still absolutely convinced about it.

Talking about the breadth of the portfolio, I mean, you've seen that one probably already. I mean, we are really, really broad. I mean, we've got 3 main gaps, cell culture media, bioreactors and viral filters. We've got to play in more or less anything else. And we obviously want to keep on broadening that portfolio of products and looking at different opportunities, whether organic or inorganic to make sure we've got a bigger play across the board here. So we talked quite a bit about how we're going to outpace. It's a bit of a different setup here.

So I want to start with the first one, which is really we are creating solutions. I mean, when you compete with 4 big guys who are all like anywhere between 4x and 10x bigger than you are, I mean, you have to be differentiated. I mean you can't just come with me-too products and so on. We will have 0 chance. I mean the guys who have tried to do that, they are not particularly successful. So we're just trying to really make sure like we are creating new solutions. We are fixing problems for customers.

ATF again, is a perfect example. Right now, I mean, everybody is looking at downstream continuous manufacturing. That's probably an area where we want to help customers in the future because that's really a new solution that everybody has been hoping to get something to deal with, which has never happened so far. Digitization is another great example, as I talked about earlier. But at the same time, we're trying to increase our position. So let's talk about onshoring. I mean we do have a seat at the table.

Now thanks to this portfolio, we've really broadened over the last several years. Now we have a seat at the table. I mean, quarter 4 of last year, we received several RFPs that we never ever received before. I mean we started to win some. I mean, decision-making takes time. I mean you all know that. That's a CapEx spending tap that we can't wait to see opening. But I mean, we're starting winning. I mean -- and the opportunity for us is actually massive. I mean I won't do the math that I've done.

But for us, I when you really take haircut on what has been announced and so on and so on and our market share, I think we have probably a USD 500 million hardware opportunity around the corner, when I say around the corner for the next probably 3 to 5 years, which at our scale, it's a massive opportunity, obviously. And beyond that, obviously, we're trying to gain market share on the flat sheet cassettes, which we are, and we're trying to gain market share on fleet management where it has been more difficult, but we are doing everything possible to be successful here as well.

And finally, we talked about clinical versus commercial. We talked about Asia as well. We've got something that I think nobody else has got, which is our Key Account Management team, which is really built with people who have been in the industry for the last 20 years, 30 years, who know each of these customers personally, multiple contacts and so on. This has been a great tailwind for us for the last several quarters and so on. And I think we're still at the beginning of the story.

We said earlier, we are selling 2.5x more of our products today than we were 5 years ago with those key accounts. I think on the scale from 1 to 10 with those big accounts, I think we're just between 2 and 3. So we've got a massive opportunity to further grow with those guys in the next several years here. So we talked about the 80% differentiated, so I won't repeat that again. Maybe the New Product Introduction, and that's a metric that we are tracking very specifically.

And having been in that industry for the last 30 years, I can tell you we are like far better than anybody else on that side, meaning last year, about 9% to 10% of our sales came from products we launched in the last 3 years. That's very unique. And I can guarantee you, I mean, we're spending about 6.5% of our sales in R&D every year. I mean, it's significant, much more than others. But considering the size of others, you would imagine they should be able to generate much more innovation than they do.

We're launching typically about 10 new products every year. I personally think it's almost too many. So we are trying to figuring out how maybe we reduce it a little bit so that our sales team can refocus on a smaller number, but that's a real track record for us here. So digitization, let's spend a few minutes here because that's really close to my heart. And I kind of alluded a bit to it already. But with PAT, you're grabbing the information.

But then you need to make sure you're integrating PAT inline with systems so that not only you're grabbing the information at-line because at-line is great, but at-line is not really helping you as much as inline. Inline is enabling you to increase your yield tremendously because you know exactly when you're going to have to stop your batch, but also you avoid all of the risk of cross-contamination because you don't have to take sample every 5 hours.

So combining PAT technology with systems is going to enable customers to be much more efficient. But indeed, the next step is really integrating digital twin capability like the Novasign one, which we are including in the next TFF system we are launching at the end of this year, beginning of next year so that people can really understand their processes much better than they do right now. Then the future vision, it's AI, obviously. I mean, we all hear about that on a daily basis.

Unfortunately, many people talk about it without having a clue what they're talking about. I can guarantee you this is going to happen. It's not going to happen next year, probably. It's probably going to be another couple of years before we are at the stage where we can sit with the OpenAI, the Anthropic of this world and telling them, Hey, guys, we are the leading company in bioprocessing to enable the biopharma industry to be more efficient. We need to partner together because we have access or our customers at least have access to the data.

How do we make sure now together, we can develop the tool that will enable them to be much more efficient. So it's on our radar screen. I think we are far ahead of anybody else. It's going to probably still take a couple of years, but we are very excited about that for sure. I think I mentioned that, so I'll skip it Asia as well. So let's maybe look at China because I think some of you heard me saying a year ago, I think China is going to start to rebound and look at where we are today.

I mean it's -- if there is one thing that has changed completely over the last 1 year, it's really China. And you've seen all of these licensing deals that are happening between U.S. company and Chinese company just in the last 1 week. I mean, you've got BMS first, I think $15 billion Pfizer over the weekend, I think $10 billion. I mean, the total investment is massive. So what does it mean? It means 2 things.

It means, first of all, like U.S. and starting to miss a little bit of innovation coming from those small biotechs that had a little bit of a headache getting funding in the last 3 to 5 years. But beyond that, it means like China, which had to really switch from being a biosimilar type of industry has become now really one of the most innovative, partly on the antibody-drug conjugate, but also on the bispecific antibody side.

It means like this market is becoming now a real big engine of growth for bioprocessing company, which is why we've been very focused on it. We just signed an OEM deal with a partner a few months ago or so. We are working on several options to be able to regrab the growth that we think is going to come, and it's going to be massive over the next several years in that specific country here. The commercial mix, I think we talked about as well as the new modalities, so I'll skip this one.

I think this one is a new one, and I mentioned a little bit of it already. We have a really very diversified portfolio of products. I mean think about it last year with the new modality headwind we had and then with a few other stuff that happened, we still managed to grow 16%. And this year, Q1 for me is a showcase. I mean -- and unfortunately, Filtration was not doing as well as we would have hoped because one of a couple of our big accounts informed us like they were managing a little bit of their inventory this year. Look at the other guys, I mean, analytics grew more than 50%, in fact, in quarter 1.

We say we're going to grow probably more than 20% in the full year, but we grew more than 50% organic, more than 40% in quarter 1. Chromatography, it's about 4 or 5 quarters in a row like we've been growing double digit, if not even above 20%. And Protein, think about it like 2 years, 3 years ago was like the nightmare scenario where our 2 big OEM partners tell us at the same time, we are not going to work with you anymore.

Not only we've managed to recover from it, but we are generating growth, 15% growth, mid-teens growth in quarter 1 on a very tough comp because quarter 1 of last year was very high. So we have a really broad portfolio of products. I mean if there is one key takeaway for you today, imagine we wouldn't have the headwind we have right now. I mean, the growth would be absolutely massive. I mean, so that's really something I just want you to understand today.

Capital equipment, obviously, something we are very, very focused on because we did have a pretty good year, partly during quarter 2, quarter 3 of last year, and then we started to see a little bit of a slowdown. We are still doing okay because analytics is booming, but also our Metenova stainless steel mixer business has been benefiting from the very high growth, both in China and in India as well. But the rest has been definitely a little bit slower than we would have liked. That is a massive potential tailwind for the future. I mean you heard me about the number.

Our funnel of opportunity for hardware right now is more than 20% higher than a year ago. We're just waiting for customers to make a decision. And once the tap is going to open, that's going to be, for sure, a massive opportunity for all of us, by the way. I mean I don't want you to think it's only represent -- it's only a few numbers of company having those hardware to offer. I think it's going to become very soon a big seller market, and most companies are going to benefit from that very grandly. So with this, are we confident that we can outpace market?

Absolutely. I mean think about it last year, 16% organic non-COVID growth. We definitely outpaced market by more than 5 points last year. This year, obviously, with the headwind we have on gene therapy, we're going to be a little bit less than 5%, but we are absolutely above market, but we're absolutely very convinced that we're going to be able to outpace in the near term, which is why we said we're going to double the size of the company in the next 2 years. And we're going to make sure, at the same time, we are improving margin as well, which is why we said we are going to target 30% EBITDA margin by 2030 as well.

So we're on the right pace. I mean, here, you've seen, I mean, a really great start of the year, good year last year, great start of the year. We also decided to put in place that transformation office, not just to enable us to accelerate that EBITDA margin because it will, but it's not the primary target. The primary target was really to make sure we accelerate the -- getting Fit for growth, meaning improving the way we operate the company from every angle, IT, AI implementation, but also site consolidation and so on and so on.

But with volume plus price plus the Transformation Office and the OpEx leverage, we're absolutely extremely confident about our ability to move towards the 30% EBITDA margin. So just a couple, I think I mentioned quite a bit of that already on Transformation Office, ITI I did. One thing maybe because it's also helping us to accelerate further top line growth, that Transformation Office. Think about it. We are still considered to be somewhat a bit of a newcomer, particularly for hardware.

So the first thing you need is to make sure like once you start to get wins and you deliver to those customers, you're not letting them down. I mean that's the most important ever. Imagine you decide to switch your IT supplier at home and so on, your net supplier and then suddenly they let you down after a month, you're going to go back to the previous one right away. I think here, that's something we are really focused on to make sure like we are supporting our customers partly from a service point of view.

I mean, I've mentioned when I joined the company 2.5 years ago, so it was taking us 4 months, 4 months between the time we were delivering an equipment to a customer and we're installing it. Can you imagine you buy a big piece of hardware at home and then your suppliers tell you see you in 4 months, you don't like that, right? So now we're down to 1.5 weeks. I mean that's just an example of getting fit for growth and making sure we bring the right level of service to our customers so that they want to keep on doing more and more with us.

Site rationalization, we have far too many sites. I mean, for a company of our size, I mean, we've got 17 manufacturing sites. I mean, so we are working every year on how do we consolidate that so that -- and then what we've done is we have 8 to 10 of our sites that we know are the site for the future. And any decision we're making of investment has to be on one of these 8 to 10 sites.

And at the same time, we are trying to shut down the other one so that we've got much lower number of sites in a few years from now. Okay. So just looking at time. So delivering on strategic priorities. So we've delivered last year across the board, and I was really happy, obviously, above-market growth, 16% organic non-COVID. Sorry about the non-COVID. I got that question several times.

The reason why we are the only one probably that still had to talk about non-COVID last year is because we had a restatement in 2024, where there was a big chunk of sales happening on COVID. That's the only reason why I promise you -- well, I can't promise you because maybe COVID comes back, but I hope we don't have to mention COVID anymore in the future. Anyway, expand margin, expanded operating margin by 90 basis points.

I mean, in fact, it was 240 basis points organically, but we really -- what we reported out was 90 because of the acquisition of 908 -- we continue to innovate. I mean, we had several very important launches last year, SoloVPE PLUS. I mean just spending maybe a minute on that. When I joined the company and having been in a different world before, I couldn't believe like we never ever launched a second version of any hardware we launched in the last 10, 15 years.

I mean, there is huge opportunity for replacement upgrade market for any hardware you're selling on the market. And particularly when you've got installed base like Solo, where you've got more than 2,500 units and same with the little sister, which is our small-scale TFF. I mean, the first thing I told the team, we really have to develop new version of our installed base.

Look at one of the reasons why we have this huge tailwind, and it's just at the beginning of it with the C Tech business, is because we are generating that replacement upgrade market that is coming on top of the organic growth of this type of business. We are doing the same. We're going to launch a small version, small TFF version of a similar installed base of several thousand of units beginning of next year. That should be a huge tailwind for filtration next year.

M&A, very important. I mean the last acquisition was a year ago. We've been really upgrading very much the way of working of that team. I'll be honest with you, was a small shop. So they needed to get really fit for growth, probably much more than we do ourselves. So we spent a lot of time on that. We have improved the funnel tremendously, and we think that's going to be a very nice big growth for us over the next 5 to 10 years here.

And finally, again, to hire. I mean you hear me talking about people. I mean, when you look at the organization we have today, I mean, we have an incredibly strong team of leaders. I mean -- and with all the credit I give to Tony for what he has built and an incredible franchise, we really needed to move from a couple of people making decision for the entire company to have now a team of people that is really capable to absorb and empower their own team to move faster and so on because that's going to be absolutely critical for us over the next 5 to 10 years when we become a multibillion U.S. dollar company.

And this year, they are pretty much the same, to be honest. I mean if you think about it, the above-market growth is still obviously line of sight for us. We are partly focusing on key accounts and on APAC as well. I mean I talk a lot about China, but a country like Korea for us is a massive opportunity. I mean we've done a really good job over the last couple of years to get traction at some of the big actors in that region as well.

Expand margin, we are accelerating it right now and with the transformation office, we said we probably can accelerate by 100 basis points as early as next year, which we are very happy about. R&D, we have multiple launch happening this year. I mean, parting on the protein side, I mean, we don't talk too much about it because protein probably takes a little bit more time. But when I look at between the catalog product we've launched and the multiple custom projects we are working on very often for what are commercial drugs that have been on the market for several years using resins that were not productive enough and so on.

I mean it's going to be a bit lumpy in the next couple of years, but we've got massive opportunity coming out of that over the next several years. System, we are still developing a lot of new features. We just launched a new version of RS10 at high pressure, which has got a lot of traction, and we are going to add some more PAT technologies on each of our system over the next couple of years. M&A remains really our top priority #1 in terms of capital allocation. I mean I get the question asked very often, hey, what about buying some of your share back and so on.

We still believe at this stage, we can do much better with our money, which is why we're still looking at a lot of opportunities on that side. And then finally, still very focused on getting further fit for growth. This year, most -- biggest area of focus is really on the IT side. I think that's it, 17 seconds, not too bad, right? Maybe some time for you, Yes. Thank you.

Yes. Thanks very much, Olivier. Maybe I'll just ask one question before we go, if that's okay, which is you talked on the quarter 1 call about a meaningful pickup of orders in March that went into April. I feel like maybe there was some confusion at a recent investor conference. So just curious if you could talk about maybe the strength into the second quarter and your perspective on how the business is going.

Yes. No, thanks for the question, Matt. I mean, as you know, we typically don't talk too much about the current quarter, but I think for once, I'll make an exception here. But maybe let me take a quick step back first. We had a massive order intake in quarter 4. And when I say massive, unfortunately, I make a lot of bad decisions. Sometimes I decided to stop talking about orders in quarter 3. We had the highest order ever in the company in quarter 4, which is why we entered into 2026 in a very strong manner.

What was somewhat a little bit disappointed is the first 6 weeks of '26 were a little bit slower. So we will wonder well, probably because quarter 4 was so strong. But then we started to see a really nice acceleration in the second half of quarter 1, and this has kept on going very strongly so far in quarter 2. So we are really very confident. I mean if you think about the fact we delivered midpoint of our guidance in Q1, we already said we're absolutely very confident we're going to be at least at midpoint of our guidance in Q2 as well.

We are probably one of the very few that is in that situation right now. I mean if you look at many others, I mean, they have to see a real acceleration between quarter 1 and the rest of the year or even first half and the second half. I mean, for us, I mean, we wouldn't need to see any improvement of the current situation to be able to deliver midpoint. I mean, in fact, we would need to see degradation to be at the lower end of our bracket. So from that point of view, we are pretty confident about the year.

All right. Message received. Thanks very much, everyone, for joining us, Olivier. Thank you very much. And for those who want to join us, it's in the Richardson room upstairs. Thank you.

Thank you.

We're excited to host Repligen for our next fireside chat. I joined by Jason Garland, Chief Financial Officer; and Jacob Johnson, IR. And with that, we'll kick things off. We're going to do just a fireside chat. If you've got questions, throw up your hand, and we'll try to call on you when we can.

Maybe just to kick things off, you guys recently reported 1Q just a couple of weeks ago. Maybe give us a high-level rundown of how the quarter played out relative to expectations, sort of what was a little bit better, what was a little bit surprising? Any key takeaways there?

Yes. Look, we started the year in a view -- in our view, executing exactly what we set out to do, right? So we had a strong first quarter, better than expectations, certainly on a top line basis as well as earnings. It was right down in the middle of the fairway for our overall total year guide on organic growth. So it started strong on the top line and enough confidence in our margin profile that we actually raised EPS guidance for the year. So financially, a great start.

Second, I'd say that we -- it helped build that confidence in our total year guide as well. We look at, again, first quarter, 11%. We've shared that second quarter is going to be around the same. That's right in line with our total year guide and which means the second half doesn't require an acceleration in growth, right? So again, we kind of keep executing what we're doing. So we've increased our confidence.

The other thing is that we've delivered that margin expansion, but we also shared, I think, some tangible actions that we're taking to make margin expansion, I'll say, number one, more sustainable; and two, accelerating a little bit beyond what we've shared before. So we launched and announced a transformation office, both focused on our Fit for Growth journey in terms of the capabilities we have to continue to grow and scale as well as some very specific projects that will help deliver margin expansion. And we shared that by the end of next year, 2027 on a run rate basis, we'll see about a point of margin expansion as a benefit.

And so again, we're building, I'll say, a structure, a framework, bringing in the right resources to execute that. We also announced a small sale of our Polymem segment, small $7 million-ish of sales last year, but losing money. And so again, cleaning that up as well as a part of our transformation.

And the other thing that we were really excited to share was the signing of an OEM partnership in China. So we've talked a lot about finding ways to be, I'll say, more [Audio Gap].

Using their local manufacturing cost structure, local supply base that gives us to get access to [indiscernible]. So we couldn't have been happier with the start of the year with the financial -- finances we put up the trends and all the great strategic priorities that [indiscernible].

Sure. All right. That's a good overview. Maybe we'll dive into a little bit deeper performances in the quarter. Can you sort of talk through filtration, chromatography, proteins segment or subsegment one by one [indiscernible].

Yes. So proteins grew very strong. We saw both strength on the ligand side, but then also some of the other pieces that we have within our custom and resins. We -- filtration, again, kind of mid-single digits with overall growth. We talked about some dynamics there with ATF and happy to share some more of that a bit later.

Chromatography, again, really great growth in the quarter as well as our Analytics segment. And we've seen a lot of continued traction on particularly our upgrade cycle on the SoloVPE PLUS within our analytics business. So in fact, they helped really lead the charge on our overall equipment performance as well in the quarter. So it was great as we saw great growth across all the franchises. Again, a good testament to the kind of the breadth that we have and the diverse nature of the portfolio.

Okay. I mean since you touched on ATF, maybe we'll dive into that a little bit deeper. You had some customer-specific timing, some inventory dynamics. You have a little bit of a more moderated outlook for that for 2026. Sort of what gives you confidence that you've got strong visibility there and sort of talk about the rebound beyond that?

Yes, absolutely. So I think maybe first point is ATF grew in the first quarter for both consumables and capital equipment. As you mentioned, Mike, we called out a headwind on ATF that moderate our expectations for ATF for the balance of the year kind of as part of our updated outlook for the filtration franchise as well. In terms of what's going on there, it really relates to 2 customers who are managing inventories. We don't think that's totally uncommon for kind of a novel technology like ATF when it's early in its life cycle.

As a result, we think it's really kind of a transitory headwind that we're facing this year. And we expect those customers to kind of order again next year. And that's what gives us confidence in ATF returning to robust growth next year. I think the other important point is both those customers use ATF beyond the commercial drugs -- or yes, commercial drugs we're referencing there. And so we think it's really kind of specific to inventory management. It doesn't relate to anything else. I think as you think about ATF this year and beyond, we continue to win new customers. We continue to expand with existing customers, and we have a really strong pipeline of opportunities.

And I think to the prior point Jason made is even with that headwind, we still have the same organic growth outlook for the year, which highlights what we've been emphasizing for some time, which is we have a broad diversified portfolio of offerings and growth opportunities across all our franchises.

One of those customers actually platformed ATF across a lot of their lines. And so again, this is a very specific inventory dynamic demand.

Is that like a 3-, 6-month drawdown? Or just like how long until you're past this headwind?

We see it as kind of a '26 item, right? And whether that changes towards the end of the year, we'll continue to connect with them. But we're -- our outlook and assumptions is that really that there's nothing that comes through [indiscernible].

And maybe the other important point I should note is outside of kind of the dynamics in ATF, we see healthy demand for consumables in the rest of the portfolio. So again, I think this is very much kind of an ATF customer-specific headwind that we've called out.

And I'm sure you've done this work. Outside of those 2 customers, what are inventory levels like? Is there a concern that someone else 3, 6 months from now down the road will have the same process? Or is there something that these guys have more elevated inventory to begin with?

I think as of now, we see it really confined to these 2 customers. And I think it's a testament to how close we are with these customers that we kind of were able to identify this and call it out as it became apparent. But I don't think we're seeing the impact elsewhere within ATF on any other customers.

We still have a good mix of commercial versus clinical as well business. So this type of order of magnitude of inventory is going to be more on the commercial side as well. So again, that's the breadth of what we're offering helps in that.

Okay. All right. And then maybe more broadly in the portfolio, the strength you're seeing in the first quarter, the strength you're projecting for the rest of the year. Anything you can point to in terms of product type or drug class that's driving that? Is it more mAbs, biosimilars, cell and gene therapy, just sort of dive into sort of where you're seeing the best opportunity?

Yes. I'll start on the kind of modality side of things, and then I'll let Jason maybe chime in on products. But yes, look, I think it's very much mAb-driven. In the first quarter, new modalities were dilutive as expected. We've talked about or cited this gene therapy headwind. As a result, I think we'll continue to view new modalities as dilutive for the year as well. With that said, if you look under the hood, we saw strength in cell therapy, which we've now seen for several quarters now. I think that's really encouraging, and we're seeing a lot of opportunities there.

And then if you look at gene therapy, ex that particular headwind, we actually saw growth in the quarter. So I think that's encouraging along with the fact that there's been 2 gene therapy approvals this year. So I think you put all that together, we continue to view new modalities as a strategic end market for us, and we are seeing opportunities in cell therapy. And ADCs aren't in that count, but I think we think about them similarly.

And from a product perspective, again, they cut across both mAbs and new modalities. So that's what's great as we serve both of those kind of equally across the portfolio. Again, talked already about the analytics growth. That's certainly going to be one of the things that we continue to lean on this year. In chromatography as well, a lot of good demand, a lot of good conversion of new customers. So again, this is that type of product where we're not very frequently competing with a similar. It's more about convincing customers that they can outsource what they most often do internally and the service and the value that we can bring for that, and we continue to see good conversion on that. So those are 2 areas in particular that we're really excited about. And proteins as well we should continue to have a strong year.

You talked about dilutive growth from new modalities and some of the effects there. Is that specifically 2026 dynamic? Is that a little bit longer? I mean it's still early in the year, but like how much visibility do you have into next year and beyond when that could turn to be growth accretive again?

I mean -- so again, we're still hurt this year by this -- by the gene therapy change. So that -- and like Jacob said, outside of that in the gene therapy space, we're actually growing. So we see it as kind of let's get through the anniversary of that headwind and overall, still very bullish on new modalities in total and particularly gene therapy.

And to be blunter there for people who aren't familiar, that relates to a specific customer, and we're assuming 0 in revenue from them this year. So I think hopeful that we won't have that headwind again next year.

You can't get worse than 0.

Yes, it's an easy comp, too, right?

There you go. Maybe one of the other lens that investors look at when I think about the business and the market is equipment versus consumables. You've had really good strength in consumables for a while. Equipment, a lot of focus on orders, lead times there, sort of a leading indicator. You talked about some improving equipment order trends later in the quarter. Just help frame the magnitude of that, how strong of a single data point that is being like week-to-week on equipment orders and book-to-bill and things like that. But how much should we be reading into that or not reading into that?

Yes. So I mean -- so if you take a step back, the guide assumes equal growth, right, low double digit for both of those segments through the year. So again, I think good equal contribution overall to our growth story. Consumables, again, has been great strength and will continue. The equipment, I think, is a bit of a tale of 2 cities. We've got -- and again, I've already referenced a couple of times now. So equipment [indiscernible] is absolutely being helped by the analytics side. So again, that upgrade cycle is a big piece of that.

We saw analytics up 50% in the quarter and 40% was organic, right, because we still have some inorganic from the 908 portfolio that we purchased from them. But so that's really been a leader. And then the other piece on the equipment side that's been a growth driver for us is mixers. So this stems from an acquisition we did at the end of 2023. We launched new products and really starting to see some good pickup on the mixing side as well. That's another place that just had some good luck in China too so those have been really the growth.

When you look at the, I'll say, the more traditional downstream filtration systems, that's where we're seeing more of a flat dynamic. This is where your question about kind of customer dynamics where we continue to see a good pipeline of -- in our funnel, right, of opportunities, but we're picking our analogy, but waiting for the tap to open or the dam to break, pick and choose what you like, but that we're still waiting for customers to start taking some decisions because we don't see it as a, oh, we're bringing in opportunities and we're losing them.

It's the decisions aren't being made and there's -- whether that's MFN digestion or kind of just some of the overall uncertainty in the overall pharma space. We see some of those decisions being delayed. And that's -- we talked about that in February, and that dynamic continues. But again, back to Jacob's point, with a broad and balanced portfolio, we're able to offset some of those lower points with other fast-growing products.

Why has analytics been so strong? Is this a comp dynamic? I think about portfolio refresh, new technologies? What's driving the extra investment there from your customers?

Yes. So it really is that portfolio refresh. I mean we launched a new generation of our -- this is our At-line device. So it's the SoloVPE PLUS that we just launched with upgraded features and technologies. And frankly, this is one of those areas where when Olivier came in, it was, well, what do you mean we haven't upgraded or launched a new gen of this after -- was it 10 years or 6 to 10 years old. So it's been a while. So we took that on, became a priority, and we're seeing some great traction.

So again, it's -- we all love new technology, right, our new next-gen of phone, et cetera. But again, it brings enough good capabilities, functionality that has been a real good success. There's a fair number of units out in the installed base that we've been the capture. We kind of see this as a tailwind for us probably over the next 18 to 24 months. And then also expect with that to be able to capture some new growth as well. So not just the upgrade and replacement cycle, but actually get new customers. And it's a broad customer base that we sell that to, right?

It tends to kind of -- the At-Line tends to be a little bit more on the TD side, but it's not -- it's big pharma, CDMOs, biotech, et cetera. So we've got a lot of good [indiscernible].

And you mentioned some of the larger, more traditional filtration systems still being a little bit touch and go. I mean what are we waiting there? Is this a capacity issue where there was a lot of investment there in prior years and you just don't need the extra capacity. Is this a reshoring dynamic? Sort of like what's the next step there?

Yes. I mean, look, we would -- we've characterized it as this MFN digestion, just kind of the pharma ensuring and understanding what are the priorities, some of the things that changes that we've seen with the administration and priorities as well and how to respond to those. I think our view is that the capacity will be needed, right? The end therapies and drugs that are ultimately being produced will continue to grow, and they'll need more capacity. And then it's just kind of deciding when and where, right? And I do think there's that everyone has talked about the opportunity with onshoring and that it makes sense to either expand or build out within the U.S. Again, the timing on that still seems to be somewhat of a question.

But that in the end of the day, even if a small percentage of the overall -- the onshoring opportunity is very big numbers. And so even if you got a small amount of that, we still think there's an opportunity for all players in the space. So I think it's just the timing that we're waiting for to see kind of what -- our funnel of opportunities continues to grow. And so now again, it's kind of when does the tap turn on.

Okay. And on a couple of other points you briefly touched on earlier from sort of like a customer segment perspective. Emerging biotech grew nicely in the quarter, but still sort of below historical levels. It's gotten really mixed data points on how biotech is playing out across the industry. What are you seeing there? And what's it going to take for that to fully come back?

Yes. So I mean, I think, first off, because we get asked a lot about this, right? Like clearly, funding was really good in the fourth quarter last year, I think really good in the first quarter, and it seems like April was really good. So I think that's certainly an encouraging kind of KPI, and I get why people ask about it. The reality is that they get the money, we then needed to get out the door, right? And so I think for us, we've had 4 straight quarters of growth from that customer base, which means one, the comps start to get tougher. But I think that suggests we're seeing stabilization.

With that said, if you look at whether it's dollars or our mix from that customer base, it was probably 8% or 9% of our revenues right now. Not that long ago, it was 10% of our business, if not a bit higher, right? And so that's where our view is. It's certainly encouraging trends there. Certainly I think there's an opportunity in front of us given the funding trends. But I think we'd like to see kind of more tangible evidence of that money being spent before we kind of declare that it's back. But certainly, we're under-indexed there versus where we were not that long ago.

I think for us, the question always becomes, as funding picked up, what's the timing, right? Does that translate to orders and sales? I know you've always kind of talked 6 to 9 months, maybe in today's environment that ends up on the longer end of that range. So that's what we're waiting for as well. But overall, we still feel like that segment will be a tailwind for us, but the timing and how that flushes through is, I guess, still to be.

Okay. And then you also touched on China in your opening comments, including the OEM partnership just to get a little bit more of a local presence. China seems to be rebounding strongly overall. Where are you seeing better performance there? If you could break it into what are the pockets of growth? And then I would just love to hear more about the OEM agreement and maybe next steps beyond that?

Yes. I mean, so number one, we firmly believe that biopharma in China is going to be a key leader, right, globally and will be a huge source of growth. And so really, I'd say we've been employing 2 elements of our strategy. Number one is we brought in new leadership, new team in many cases in our existing China country structure. And we're already starting to see, I think, some of the benefits for that. We've had our best quarter in the last 2 years in China on a very low base, mind you, and coming off of some share loss. But I think, again, we've got now a a much stronger team that's able to capitalize on the opportunities that we have.

And that cuts across a lot of pieces of the portfolio. So that's the kind of go execute and run what we got, right, and with the team we have, and we're starting to see some good momentum there. The second piece is now back more to our longer-term strategy, which is the OEM partnership. So again, our view is that to really be able to support and take advantage of the overall biopharma growth in country is to be more localized, right? And as I said, I don't -- our view wasn't let's go plant a flag, build a greenfield. It's how do we find the right partner to grow with. And so we've started -- they'll start manufacturing our products. We'll sell that, but it could evolve into a broader relationship, building more products. And certainly, we'll be able to to maybe leverage some of the local relationships that they have otherwise and be able to grow in different ways.

So we -- the question always becomes, okay, you bring in a partner. Is there a risk of technology IP loss? And our view is that we certainly took the time and vetted to find the right partner. We haven't announced the company, but we know the leaders. Our leadership and team have worked with them in the past. So they're trusted, known leaders in the industry. And our view is that there will always be a risk of IP loss, but you either sit out and watch and not take advantage of any growth in China or you participate and you manage those risks, and that's what really in our approach. And so we're really excited about what this translates to. And and allows us to play in a more localized way and take advantage of what we see is, again, is going to be a big biopharma growth in the region.

Is this one move -- you talked about local presence and having sort of that flag. Is this one move enough? Or do you need to do more? Does this get you everywhere you need to...

Well, I think for us, it's a step. Our view, again, depending on how it goes, would be to continue to expand with this partner in different ways. And so we see it as a first step of multiphases, which could be more products. It could be different relationships. It could be at some point, is there -- within Asia, there's other countries and regions that are amenable to trying to build products that you expand out. So there's a lot of different ways we could get there. So we kind of see this as a step one with that path to be defined.

Okay. Maybe along a similar line, let's talk about cash use, M&A portfolio evolution. You've got almost $800 million of cash in the books now. You've got a focus on capacity expansion, analytics, innovation. How are you thinking about M&A opportunities going forward? Any gaps you'd like to fill? Any opportunities should be up there from a valuation perspective?

Yes. So I mean, M&A remains a high priority for us. We still think that's the best use of our capital and the cash that we have available. We, again, are focused on finding technologies that are differentiated. We don't want to go down a me-too path. We -- there's gaps to be filled in our portfolio. We've shared those a lot, both on the mAb side, but then also opportunities to support new modality workflows. And so a lot of opportunity, very active in the space. We've also gone down the path of minority interest as well as investments.

So we announced Novasign earlier last year. So this allows us access to partnerships to new technologies, frankly, without sort of needing to deal with some of the short-term dilution that might come with earlier-stage companies. So we're really excited about what Novasign can bring, and we're open to that type of investment as well. So a lot of activity, a lot of opportunity. You got to -- it's all got to line up. They got to want to sell and we want to buy and all the pieces that come with it, but very active right now.

Okay. We got about 5 minutes left, if there's any questions from the audience if we can. All right. We'll keep going. Let's talk a little bit about margin progression and margin story from here. When you introduced the transformation office targeting some incremental margin. What are the biggest levers you have? And can you talk us through sort of what that ramp could look like over the next couple of years, the trajectory would be?

Yes. So again, I kind of made the point earlier that the transformation office is a way to formalize and I'll say, assign and dedicate the right resources to a lot of different priorities that we've been either working through or planning and it puts the structured framework around in a way to bring in, again, not only dedicate some of our internal resources, but also bring in some external experts to help us. We see it as a path for acceleration. So we've shared probably over the last year or more, this target to get to about a 30% EBITDA within 5 years.

But I also had shared often that we felt like '26, '27 were still more of investment years, and we would see, I'll say, an acceleration of that margin expansion in the latter part of that period. I think the transformation office and some of the benefits it can deliver for us is a way of accelerating that and pulling some -- I won't say it's linear, but making it less of a sort of a ramp-up at the end and put the framework. It's going to be focused on products in our portfolio. For example, we've talked about fluid management is one of the elements of the portfolio that is below average, right, for our product margins. And so that's one of the focal points which could be a design changes, material, it could be manufacturing, adding more automation, et cetera. And so outlining all those different opportunities that can drive it. And there's other things in terms of supplier, working with them. And then we also talked about beyond the margin expansion, the transformation office would help us on our Fit for Growth journey.

The big one in there is our IT modernization, right, making sure that we take more advantage of the systems we have today and then also rationalize some -- I mean, for our size company, we have way too many apps, way too many vendors, right? So how do we rationalize those? How do we start to align on common platforms. And then all of that as well as a push on our data management and infrastructure will be the foundation for us to build more AI from an internal benefit as well as how do we incorporate that into our products as well.

So that's why that's a really important one because it's the fit for growth, it's modernization. But frankly, I might get some savings as well when it comes to some of the rationalization on vendors. So really excited about this. I think, again, we said that we see about a point of margin expansion by the -- on a run rate basis by the end of '27. So we'll see some of those benefits. And then on a go-forward basis, we'll kind of see that full point from '28 and beyond.

Okay. Maybe one last big picture question for me. Just thinking about the markets and where we sit today and how we feel about bioprocessing market going forward. It's been really volatile the last couple of years. We talked about some of the moving pieces with some of the individual customer contracts and maybe some modalities. But you did 11% in the first quarter. You're guiding to 9% to 13% for the year. Taking a step back, everything that's gone on emerging biotech, pharma, [indiscernible] reshoring in China, has it changed your views on bioprocess long-term algorithm, long-term growth demand drivers?

Absolutely not. I mean this is -- this has an incredible tailwind behind it. Again, we see this year still kind of this digestion happening. And like I said, the pipeline and the opportunities continue to build up. We think we're well positioned to capture those opportunities in a different way than we ever have before with our broader and deeper portfolio as well as the relationships that we build. We've already -- we talked a lot about starting to actually have some swings at that for RFPs. We actually won recently. And so that's going to be the start of it. So we're thrilled. We're excited about the year and even more excited about the future beyond 2026 and the opportunities that we have.

Okay. All right. Well, with that, we'll have to leave there. Thanks, everybody for joining. Jason and Jacob, thank you.

Appreciate it.

And we'll provide financial guidance for the full year 2026. Join us on the call today are Repligen's President and Chief Executive Officer, Olivier Leo; and our Chief Financial Officer, Jason Garland. As a reminder, the forward-looking statements that we make during this call, including those regarding our business goals and expectations for the financial performance of the company, are subject to risks and uncertainties that may cause actual events or results to differ. Additional information concerning risks related to our business is included in our quarterly reports on Form 10-Q, our annual report on Form 10-K, our current reports, including the Form 8-K that we are filing today and other filings that we make with the Securities and Exchange Commission. Today's comments reflect management's current views, which could change as a result of new information, future events or otherwise. The company does not oblig or commit itself to update forward-looking statements, except as required by law.

During this call, we are providing non-GAAP financial results and guidance, unless otherwise noted. Reconciliations of GAAP to non-GAAP financial measures are included in the press release that we issued this morning, which is posted to Repligen's website and on sec.gov. Adjusted non-GAAP figures in today's report include the following: organic revenue and/or revenue growth, cost of goods sold, gross profit and gross margin; operating expenses, including R&D and SG&A, income from operations and operating margin, other income or expense, tax rate on pretax income, net income, diluted earnings per share, EBITDA, adjusted EBITDA and adjusted EBITDA margin. These adjusted financial measures should not be viewed as an alternative to GAAP measures, but are intended to best reflect the performance of our ongoing operations.

With that, I'll turn the call over to Olivier.

Thank you, Jacob. Good morning, everyone, and welcome to our 2026 first quarter call. We are delighted to share our first quarter 2026 results. Great execution once again by our team enabled us to deliver 15% reported revenue growth or 11% organic and 160 basis points of adjusted

operating margin expansion. Mid-teens top line growth, coupled with disciplined cost management resulted in margins outperforming expectations. In addition to our strong financial performance in the quarter, we advanced several key strategic priorities. This includes the launch of our transformation office, the associated sale of the polymer business and a new partnership in China. This OEM relationship advances our strategy in the country where we are seeing significant growth again.

I'll touch on each of these initiatives in more detail shortly. As I reflect on our end markets and company today, it's encouraging to see the strength we are seeing across all of our customer segments. The talented and experienced team we have assembled is executing fiercely on our differentiated strategy. This has resulted in a very rich high probability opportunity funnel that just needs to be coupled with faster customer decision-making. We did see encouraging signs in the first quarter, and remain convinced that capital equipment tap will open.

We delivered $194 million of first quarter revenue, driven by healthy demand across our broad portfolio and all geographies. Analytics led the way with 50% plus growth, but all of our franchises grew nicely again in the first quarter. Consumables, including protein, grew double digit which was coupled with solid capital equipment growth and services remained a standout with 30% plus growth.

Capital equipment demand benefited from strength in Analytics, mixers and easier comps. We also saw growth across our diversified customer base in all geographies. Order trends were solid in the first quarter with a significant pickup in March and included some conversion of our robust capital equipment funnel. Our first quarter results and these recent order trends reinforce our confidence in our full year revenue outlook. Jason will provide more details.

We are reiterating our expectation for 9% to 13% organic growth, while updating our reported revenue guidance to reflect the sale of our noncore and low-margin Polymem business. This reduces our full year revenue outlook by $7 million, but improved our margin outlook. In addition, given our strong first quarter performance, while increasing our adjusted earnings per share guidance for the full year. We remain excited about our differentiated product portfolio, the global team we paired and the strategy we're executing.

As we look ahead to the next several years, we see a number of opportunities across our portfolio that position us for robust growth and allow us to continue to outpace the market. Looking at our performance by end market, we saw widespread strength across our customer base. CDMO revenues grew mid-teens with similar growth across both Tier 1 and Tier 2.

Biopharma revenues also grew despite a very difficult comparison. We saw notable growth outside of large pharma, including 20%-plus growth from emerging biotechs. We continue to be encouraged by growth from this customer base, though demand remains below historical levels. OEM and integrated demand was very robust given growth in fleet management.

From a geographic point of view, we saw strength across all regions led by Asia Pacific. This included a near doubling of revenues in China with our best revenue quarter in the country in over 2 years. This is a testament to the team we've put in place. Asia Pacific remains a key strategic region and I will discuss the progress on our strategy in China shortly. As expected, new modalities were dilutive to growth given the gene therapy headwind we previously discussed. We continue to see healthy growth in cell therapy and also in gene therapy when excluding that specific headwind.

I wanted to update you on the following 3 strategic initiatives: First, as we have emphasized recently, we are committed to expanding margins, while banking the efforts needed to support future growth. In an effort to accelerate both of our Fit for Growth journey and our path to 30% adjusted EBITDA margin by 2030, we've formed a transformation office that will ensure with the right prioritization and resources focused on these critical initiatives.

Key focus areas under this program include a force to optimize our manufacturing footprint for increased cost efficiency, improving the profitability of certain product lines through targeted productivity and rationalization, continuously improving service to our customers and efforts to capture the value of our differentiated products; and finally, acceleration of our IT modernization and AI implementation across all functions. Jason will walk you through more details.

But in terms of financial impact, we estimate this effort should result in at least one point of annualized margin benefit by the end of 2027. We remain committed to our goal of doubling the business and expanding margins while further progressing our Fit for Growth capabilities. The transformation office will enable us to achieve and accelerate all of these. So most of these initiatives have just picked off, we're happy to share that as part of this effort on March 30, we divested the Polymem operation in France for nominal proceeds.

While this facility was a key contributor to Repligen's ability to supply product during the pandemic, the business has since reverted to noncore sales outside bioprocessing and has operated at a net loss. In 2025, Polymem generated $7 million of revenue and an adjusted operating loss. The new owner will offer synergies in the common market in which they operate.

Second, we remain more excited than ever by our growth opportunity in Asia. In fact, Jason and I recently returned from a week-long visit to the region where we met with both key customers and our Asia leadership team. We are building a great team and continuing to gain traction with key customers in the region. We are also thrilled to announce that while in the region, we signed a critical partnership to expand our capabilities and local presence in China. The partnership outlines an OEM relationship that will increase our competitiveness and access to local manufacturing beginning in 2027.

It will be a multiphase and multiproduct arrangements that we expect to expand over the coming years. After our trip, we have more conviction than ever that China will be a meaningful player in biopharma for years to come.

Finally, I want to comment on our IT investments and digitization journey. On our last call, we mentioned investment in our IT organization in 2026 as part of our Fit for Growth journey. We have made key additions to our team this year, including new data management and AI experts. We have implemented AI across a variety of functions including, but not limited to legal, commercial and supply chain. And as part of our transformation office, we are also working to further optimize our data infrastructure which will allow us to better implement AI in the coming years.

To support our customers, our analytics franchise is well positioned for an increasingly digital environment. Our PAT product portfolio allows for the collection of both upstream and downstream data in real time. We have integrated our FlowVPX into our downstream filtration system and are working to replicate this on the upstream side.

We announced a partnership with Novasign last year and are working to integrate their digital twin capabilities into our next-generation small-scale filtration systems. We see digitization as a multiyear journey, and it [indiscernible] a key strategic focus area for our company.

Before I turn the call over to Jason, I'll provide some more detail on our franchise level performance. Starting with situation. Revenue grew mid-single digits on a reported basis in the quarter, driven by Fluid Management, ATF and other consumables. Excluding the gene therapy headwind, this franchise would have delivered double-digit growth.

With the sale of Polymem, we now expect filtration growth to be roughly mid-single digits in 2026 on a reported basis. This also contemplates a moderated ATF outlook in 2026 due to customer-specific timing dynamics that are expected to be a tailwind in 2027. As a result, we see ATF returning to strong growth in 2027 and beyond, and we continue to see overall healthy consumable demand across our portfolio.

We remain extremely confident in our process identification leadership position. After over a decade of seeding our ATF technology, we have built a high amount of trust from the biopharma industry. We will continue to prioritize further innovation and advancements that will allow us to remain the industry's partner in process in densification.

Chromatography revenue increased over 25%, driven by growth in OPUS columns. We continue to win new customers globally as they appreciate the plug-and-play convenience of prepacked columns. Given the traction we are seeing in OPUS we now expect 20% plus growth in chromatography in 2026. With this outlook, we do expect a slightly higher mix of chromatography revenue versus our initial expectations.

It was a great quarter in proteins with mid-teens growth on top of a very strong prior year comparison. We saw healthy demand across our offerings, led by our ligands, reflecting the benefits of the strategy we put in place to control our own destiny in proteins. We expect protein growth of at least low double digits for the year. Our Analytics franchise had another phenomenal quarter with 50% plus growth. This was led by notable strength in our downstream analytics offering, which had a record quarter. This benefited from strong demand for our SoloVPE PLUS, including new placements and upgrades.

We continue to assume Analytics growth of 20% plus given momentum in downstream demand and a growing contribution throughout the year from our upstream Analytics offering. To wrap up, we are very pleased with our start to 2026. We delivered 11% organic growth in the first quarter, which is right in line with the midpoint of our full year guidance. This coupled with operating expense discipline has reinforced our confidence in our full year revenue outlook and enabled us to increase our adjusted earnings per share guidance. In addition, we made tangible progress on our strategic priorities, which positions us well to drive robust growth and margin expansion in coming years.

Now I'll turn the call over to Jason for the financial highlights.

Thank you, Olivier, and good morning, everyone. Today, we are reporting our financial results for the first quarter of 2026 and providing updated guidance for the full year 2026. Unless otherwise noted, all financial measures discussed reflect adjusted non-GAAP measures.

As shared in our press release this morning, we delivered first quarter revenue of $194 million, reported year-over-year increased 15%. This is an 11% organic growth, excluding the impact of acquisitions and foreign exchange. Foreign currency contributed 3 points of growth and we had 2 months of inorganic contribution from our upstream Analytics acquisition.

As Olivier offered details on our product franchise performance, I'll provide more color on our regional performance. Starting with quarterly revenue mix. North America represented approximately 46% of our total. EMEA represented 37% and Asia Pacific and the rest of the world represented approximately 17%. North America grew mid-single digits, driven by OPUS and Analytics. EMEA grew more than 20%, driven by proteins in OPUS. In Asia Pacific grew more than 25% driven by ATFs, mixers and Analytics. And as previously mentioned, we had very strong growth in China.

Transitioning to profit and margins. First quarter adjusted gross profit was $108 million and adjusted gross margin was 55.5%. This was 180 basis points of margin expansion versus last year. The year-over-year increase was driven primarily by volume leverage, pricing execution and favorable product mix, all of which more than offset inflation and tariffs. The favorable mix was driven by growth in our Analytics business and certain accretive filtration products.

In addition, first quarter gross margin also benefited from cost absorption timing associated with production levels required to support the sales ramp through the year. We expect this benefit to normalize over the remainder of 2026. Continuing through the P&L, our adjusted income from operations was $30 million in the first quarter, up 28% year-over-year on a reported and organic basis.

OpEx grew 11% on an organic basis. We remain thoughtful about balancing investments in the business while expanding margin. We expect some additional investment in the second quarter. This translated to an adjusted operating margin of 15.4% in the first quarter, which was an increase of 160 basis points year-over-year on a reported basis and 200 basis points of margin expansion, excluding M&A and the impact of foreign currency.

Adjusted EBITDA was $40 million in the quarter or just under 21% adjusted EBITDA margin. Moving to the bottom line. Adjusted net income was $27 million, a 22% year-over-year increase. Higher adjusted operating income was offset by slightly lower interest income on declining interest rates. Our first quarter adjusted effective tax rate was 22%, which starts the year on the low end of our full year guidance, which remains unchanged.

Adjusted fully diluted earnings per share for the first quarter was $0.48, compared to $0.39 in the same period in 2025 or an increase of 23%. Finally, our cash and marketable securities position at the end of the first quarter was $785 million, up $17 million sequentially from the fourth quarter. This was driven by $20 million of strong cash flow from operations, offset by $5 million of CapEx in the quarter. We remain focused on optimizing our working capital to drive improved cash flow conversion.

I will now speak to adjusted financial guidance. As Olivier mentioned, we are reiterating our organic growth guidance for full year 2026, while updating guidance for the sale of Polymem and our first quarter results. Our guidance also assumes a couple of million dollars tariff surcharges in 2026. We are now guiding $803 million to $833 million of revenue or 9% to 13% growth on both a reported and organic basis. Our updated guidance now reflects only one quarter of revenue from Polymem which removes approximately $7 million of revenue from the full year, previously included in guidance. This continues to assume just under one point of benefit from foreign currency, which we realized in the first quarter.

Our reported growth of 9% to 13% assumes the following: mid-single-digit growth in Filtration, greater than 20% growth in Chromatography, Proteins growth greater than low double digits and 20% plus growth in Analytics. We now expect 110 to 160 basis points of gross margin expansion for the year. This assumes a slight benefit from the divestiture, partially offset by higher Chromatography mix and limited impact from the conflict in the Middle East. With the strong Q1 performance, the sale of Polymem and judicious management of OpEx, we are raising our adjusted income guidance.

We now expect $124 million to $132 million of adjusted operating income. This implies 160 to 200 basis points of operating margin expansion which represents a 30 basis point increase at the midpoint versus our prior guidance. Continuing through the P&L, we now assume $90 million of adjusted other income and continue to assume a 22% to 23% adjusted effective tax rate. Putting this together, we expect adjusted fully diluted earnings per share to be between $1.97 and $2.05, this is up $0.26 to $0.34 versus 2025 or up 18% at the [indiscernible] and $0.04 higher than our prior guidance at both the low and high end of the range.

To assist with the quarterly cadence, we expect Q2 organic revenue growth to be similar to the first quarter. As a result, our guidance does not require a second half acceleration to achieve the midpoint of our full year outlook. We expect second quarter gross margin to be slightly below our full year guidance range and OpEx to pick up slightly sequentially following our disciplined OpEx control in the first quarter.

We expect second half OpEx to be similar to 2Q. As a result, we expect solid operating margin expansion in the second quarter, while the third quarter will likely represent the lowest margin quarter of the year. Our balance sheet remains strong as we ended the first quarter with $785 million of cash and marketable securities. We will remain prudent in our spending while maintaining substantial dry powder for potential acquisitions. We expect CapEx spend to be approximately 3% to 4% of 2026 revenue.

Before we wrap, I wanted to briefly follow up on the transformation office that Olivier shared earlier. We are thrilled to establish a team of both internal and external experts to drive focus improvements in areas that will drive our fit for growth capabilities and margin expansion. This is a change in mindset that reinforces the structured framework is required to drive margin expansion beyond volume leverage.

As Olivier shared, we expect to see meaningful benefits from the initiatives. We are still finalizing the detailed scopes and benefits, but expect to generate at least one point of annualized margin benefit by the end of next year and continue into 2028 and beyond. We will see benefits in both gross margin and at the EBIT and EBITDA level. We see this effort accelerating our path to our 2030 EBITDA target.

In other words, our path to reaching 30% adjusted EBITDA margins will be less weighted to the out years than previously communicated. We expect nonrecurring charges of approximately $5 million to $6 million through 2027 associated with this effort. These will be excluded from our adjusted non-GAAP results. Finally, Olivier and I would like to thank our Repligen teammates for delivering a strong start to 2026. We continue to be energized by the opportunities ahead, and we are focused on advancing our strategic efforts in 2026.

With that, I'll turn the call back to the operator to open the line for questions.

[Operator Instructions] Your first question comes from the line of Dan Arias with Stifel.

Jason, nice start to the year on the op margins there. Obviously, you went through some of the moving parts, but can you just maybe summarize what within the quarter was sort of incidental, I guess, you could call it mix elements, timing of cost items versus more of a reprioritization that sounds like maybe it's starting to be in play here? And then like along those lines, the transformation office impact, I know you said you're still working through the moving parts there, but is the right way to think about that, the normal 1 to 200 bps of annual op margin expansion that you've been talking about, plus the impact of transformation, is that like [ 100bps ] to fiscal '27? Or are you kind of run rating by the time you get to the year at the end of the year at 100 bps. I just want to make sure that we get the modeling element of that whole exercise right.

Olivier here. I'm just going to kick it off and then let Jason give you more details. I mean we're obviously extremely happy about how we delivered on margin expansion in quarter 1, but beyond quarter 1, obviously, being able also to have line of sight of further improvement towards the rest of the year as well. And yes, you're right, the transformation office is an initiative like we've been thinking about for a long period of time. Now that we have the right people on board, we said that's the right time to kick it off. And as you'll hear from Jason in a few seconds, it's really a mix of getting acceleration on the fit for growth side, but also accelerating margin improvement. But Jason, yes?

Yes. So Dan, great 3 questions, a lot of pieces, and there we'll go through it. So yes, I'm really happy with the first quarter gross margin and overall margin performance. I think to your question, the driver really was volume, volume leverage price. So continuing to execute that. And to your point, strong mix really from Analytics growth as well as a few of the, I'll say, product lines within our overall filtration franchise.

There was a timing element to your point on a little bit from timing of cost absorption that will unwind through the year. But overall, it sets us up for well and high confidence in our guide for expanding gross margin by about 110 to 160 bps for the year.

From a profile perspective, Yes, we do expect 2Q to be lower than 1Q. 3Q may step down slightly from that as well. And then fourth quarter back higher as we grow on volumes through the end of the year. Most of that change will be driven by the mix phasing. So here's what I'd say, though, on a total year versus -- a total year, a full year versus full year basis year-over-year, mix is still a neutral dynamic for us. But for the first quarter being positive, we'll see some mix headwinds in the second and third and then again, fourth quarter steps back up mostly on higher Chromatography sales.

And to your point, again, that cost absorption unwind. So again, a real great start and puts us right on track to our guide, lifted it up a little bit with Polymem. On the transformation office, yes, again, great questions as well. Look, I'll start by, it's really about creating the structure program where we allocate the right resources to our priorities. So there's a a real heavy fit-for-growth execution and developing the capabilities we need and then the margin expansion side. That one point of annualized margin expansion by end of '27, think of that as more in the run rate, we'll have various settlements and projects that will, I'll say, come into initiation over several months, right? We haven't assumed anything in 2026 yet but there may be some benefits that we'll share later in the year if they come in early, but we're really expecting a run rate to start by the end of '27 and then kind of seeing full benefits in '28.

To your point, that's going to be on top of our normal run rate. And that was the message that we tried to share and here as well. Again, we've talked a lot about this path to 30% EBITDA target by 2030, but that we would be more weighted towards the back end. We think this initiative helps us to be less weighted in those out years, which brings some incremental in the earlier. So I'm really excited about all this. Great start to the year.

Your next question comes from the line of Doug Schenkel with Wolf Research.

This is Madeline Mollman on for Doug. Just a question on equipment. You mentioned that there was a pickup in equipment in March. Where was the strength most notable? Was it by category and customer type? And did that help you in the quarter? Or was it more the order book? And then I think last quarter, you mentioned that there were some RFPs you were waiting on. Have you started to hear back on those? Or do you feel that pharma companies are still digesting some of the MFN deals?

Yes, good questions. I mean capital equipment increased year-on-year in quarter 1 on what was pretty easy comp to be very open. And that was mostly driven by strength in both Analytics and mixers as well. We've partly seen a nice pickup of mix of demand in China, which is one of the reasons why China did so well for us in quarter 1. And similar to peers as well, we've seen orders increasing in the quarter. I mean, after what was maybe a bit of a slower start in January up to mid of February, we've seen a real acceleration of order intake towards the second half of the quarter and partly on the capital equipment side. And we realize pharmacy taking their time, but it was good to see indeed finally some answers coming and positive answers. And to your last point on RFP wins, yes, we start to win some of the RFP. We answered two towards the end of last year, which is for us very encouraging. As I mentioned previously, we didn't really have seat at the table before.

So overall, very encouraging and we would like to see further acceleration of decision-making, but definitely going in the right direction right now.

Your next question comes from the line of Matt Larew with William Blair.

You called out 20% growth from emerging biotech, and that comes off a very -- 3 very strong quarters to end 2025. You did reference it's still below historical levels. We're now working off the back of two straight quarters of strong funding data. There's been some positive clinical updates. You're going to be escaping the one large customer headwind. So Olivier, just curious for your take on sort of what's remaining to get emerging biotech back to strength and how you feel about the momentum over the last couple of quarters?

Yes. obviously, very happy to see the fourth quarter in a row of very significant growth for that customer segments. I mean, I've said like we've seen in each of the segments coming back one after the other, and that was the last one. to be still fair. I mean, quarter 1 comps were pretty easy still. So I want to see quarter 2 still showing exactly the same growth. But overall, it sounds like this market segment is back to a much more normal type of behavior.

And you're right, the customer -- the biotech funding numbers also look very good. I mean, quarter 1 was almost double what it was last year. And April was very strong. I mean I think I've seen numbers around USD 10 billion funding in April. So the good news is we've seen really a nice rebound, we're still of the opinion that the money that has been injected has not reached yet all of these guys fully to the extent that they are spending much more money.

So to your point, yes, what we've seen should hopefully be very sustainable, and we're hoping to see a similar type of growth over the next few quarters for emerging biotech. But definitely something that we are very excited about fourth quarter in a row, very nice growth here.

Your next question comes from the line of Philip Song with Leerink Partners.

Two question. This is Philip on for Puneet. You mentioned China nearly doubled in Q1 [indiscernible] low base after just 2 quarters of growth in the second half. And I think, 2% to 3% revenue contribution. I was wondering if you could just unpack this some more just how much impact was from the OEM partnership kind of what's the composition between large pharma and CDMOs? And I guess, how would you characterize how much was order timing versus sort of genuine demand acceleration?

Yes. Philip. Absolutely delighted about the way quarter 1 played out for us in China. I mean you've heard me talking about it quite a lot over the last several quarters and it was actually also to almost see a doubling of our sales in China in quarter 1. You're right, it was on very low comp. What I'm even more excited about, to be honest, is our funnel looks really very strong. I mean Jason and I were in the region recently, we spent almost a week with the team down there, and we're seeing a funnel that looks really very strong across all of China right now, and that's very exciting.

By the way, talking about China, all of Asia did very well. I mean that was our fastest-growing market geographically in quarter 1. But obviously, to your question about the OEM partner, I mean this has no impact yet. I mean, we literally just signed the agreement a couple of weeks ago. So we're going to take transfer different part of our portfolio, particularly on the filtration consumable side, and we expect those guys, those partners to be up and running probably towards the beginning of next year. But it's never really black and white. And where you're somewhat probably clear asking the question is, it's a good strong signal we're giving to customers in China that we are back and that we're going to really reclaim our market in China with that partner, but also we really want to be part of that huge upcoming market growth we're seeing in China over the next several years.

So there might be already a little impact that people feel like, wow, Repligen is going to become really indeed a very strong actor in China for China. And that's why we're delighted about that agreement. It is just a first step, Philippe. I mean we are looking at expanding that collaboration and potentially with other partners as well in China over the next several years, but very excited to be back in China.

Your next question comes from the line of Casey Woodring with JPMorgan ahead.

So you had a one point organic beat in 1Q and expect similar growth in 2Q, but you kept the low end of the full year guide unchanged. Maybe just talk about how much of that is driven by the moderated view for ATF in the second half versus the rest of the business?

And then on ATF, could you provide more color on the customer timing dynamics that are driving that more moderated view in the second half. I think in the past, you had talked about a second half ramp in ATF consumables tied to one of the blockbusters you expect in 2. So is that really just a function of a customer commercial launch? And then what gives you confidence that things will pick up in '27?

Yes. So, first of all, I mean, we're obviously very happy we started quarter 1 at the midpoint of our full year guidance. As you heard us saying we estimate quarter 2 will probably be about the same. So obviously, it will set us up very well for the guidance we've given at the beginning of the year. And the midpoint would assume at this stage like there is no need for any acceleration towards the second half of this year, which is probably a little bit of a Repligen, specific situation that we are very happy to be in right now, it's a really high comfort zone for us from that point of view.

So we would be disappointed if we would land at the low end because that would somehow imply a softening of the market that we're actually not seeing today. So we are more hopefully looking at [indiscernible] the high end. And in order to reach the high hand, we would need some type of acceleration both of our Consumable business, and you mentioned ATF, I'll come back to that in 10 seconds.

But also said that some of these equipment orders we've been receiving now in the last couple of months, would also be potentially delivered this year, which is not a given yet because we need to hear about our customer site preparedness to be able to accommodate that or not. So that cannot really the way to look at the guidance for this year. We're quarter into the year with a very strong start with a couple of more calls, we'll know much more about how the year is going to play out by the end of July when we report out on quarter 2.

In terms of ATF, yes. I mean, we have always been very transparent. I mean, we were transparent last year about what happened with that specific gene therapy program, we said we're going to be transparent has got a huge runway for the next several years. I mean I can tell you, we are more bullish than ever. A couple of our customers came to us beginning of this year, explaining as they were managing inventory this year on a couple of commercial drugs that have been using ATF now for a few years. This is not something unusual for what is still a pretty new technology where at the beginning, people built a little bit more stock maybe than they will need finally. We know it's going to be a real tailwind for us from '27 onwards because these are 2 commercial drugs, that will require more because the drugs themselves are growing very nicely. So it's really just a temporary inventory management that we are facing.

What we think about those two customers is, in fact, they are implementing ATF across many more products than this specific commercial drug I was talking about, which is why we know next year, it's going to be a real tailwind for these customers for the commercial drugs themselves, but also across the new one, they are implementing ATF right now.

Your next question comes from the line of Daniel Markowitz with Evercore.

I wanted to follow up on emerging biotech. It's good to see 4 quarters in a row, if I heard correctly, of growth from this customer segment. And I wanted to talk about the benefit from biotech funding recovery, which seems like it could flow through to back half this year and help in back half in 2027. Can you help frame the potential timing of when this benefit might occur? Remind us your exposure to this customer set and help us understand what the contribution could look like once we start to see that benefit?

Yes. I think you nailed it already pretty well. I mean fourth quarter in a row of very significant growth. I mean, I would say, very significant growth in quarter 1 was above 20% of growth. This being said, the activity level still remains slightly below historical level. So that's why we're saying it's probably a little bit too soon to call it a trend. But maybe to be a bit more specific, we mentioned in previous call, like we some of the growth coming from some of the small biotech getting acquired. That was particularly the case in quarter 2, quarter 3 of last year. It's fair to assume that some of the funding that we started to improve towards quarter 3 of last year, has maybe started to reach some of these company toward the end of last year and probably a little bit more in quarter 1.

I do expect it to become real stronger tailwind from quarter 2, quarter 3 onwards to be confirmed, but that's what we could expect, we would expect looking at this much better biotech funding environment we've been experiencing. And to answer your specific question, I mean, it's still lower than 10% of our total sales. I won't say more into the 8% to 9% vicinity in quarter 1, but probably trending back to the 10% that we experienced in the past -- in the next few quarters, I would [indiscernible].

That's helpful. And then just a follow-up. Can you talk about the ATF opportunity more broadly? Like how penetrated is this market? And how would you frame the potential impact from competitive product introductions?

Yes. No. I mean, again, let me start by saying ATF grew in quarter 1, both, by the way, in capital and consumable as well. And we've just decided to moderate our expectation for 2026 because of this transitory headwind that we've been hearing from the 2 specific customers. But apart from that, I mean, we are still extremely bullish. I mean we were getting our products designing in multiple new products, multiple new modality as well. I mean we've talked about successes we've had on the cell therapy side, and that has become a very significant tailwind for us over the last several quarters.

We are also very heavy on innovation. And I tell you, I'm very, very confident about the fact that were going to be leading the process intensification for the next several years. I mean I have 0 doubt about that. And we've got a lot of innovation being worked out right now with several launches that we expect to happen probably towards one toward the beginning of next year and then 1 or 2 others towards mid or end of next year. So we are absolutely very bullish. And as the runway on ATF is still absolutely very strong.

Your next question comes from the line of Mac Etoch with Stephens.

Maybe just following up on some of the previous order related questions. Just looking at what you called out during March, can you just unpack what specifically changed in the order environment at that point? Was it tied to improving customer decision-making, budget releases, increased activity within certain [indiscernible] like maybe Analytics or upstream systems? And how is that exit rate carried in April at this point?

Well, it's a little bit of all of that, to be honest with you, but maybe let me take one step back. So you're right. I mean we had a little bit of -- well, taking two steps back a fantastic quarter 4 in terms of order intake. And then really when I say fantastic, I mean, it was like in [indiscernible], we have not seen like for probably the previous several years and so on. So it was somehow pretty expectable that the beginning of quarter 1 would be a little bit softer. But then towards mid of February, we started to see a really significant acceleration that has enabled us to deliver a very strong order intake for the full quarter 1 really in the right zip code in terms of book-to-bill like what we expect for the previous several quarters.

So really across the board, very healthy quarter 1, thanks to what happened in March. What's more important, honestly, than order because we said it can be somewhat a little bit lumpy. As you know, what's tracking our funnel. And I won't say we are really extraordinary discipline on the way we are tracking our funnel. And one part of the funnel, I'm looking at myself on a weekly basis what we call the high probability funnel, which is a probability that is above 50% closing orders within the next 2 to 3 quarters. And I mean, probably at the highest level ever. In fact, I just made the exercise a week or 2 ago, looking at how it looked versus what it looked like a year ago, and it's significantly higher than what we've seen a year ago.

So from that point of view, we are very confident about the way things are going to play out for the next several quarters. what we're not still controlling fully is decision-making. And that's maybe where indeed, I would still see a bit of a difference between consumables and equipment, both look really good for this year. I mean, in terms of guidance for the full year, we see like both grew double digits in sales. But obviously, most of the headwinds we've talked about are going into consumable, as you know, meaning the gene therapy program on one side and then these two ATF customers on the other side. So it means like consumables are still doing extremely well.

On capital equipment, it's fair to say like Analytics and mixers have been leading the pack. We would like to see a real acceleration of what we call the bigger type of CapEx equipment. We started to win some of these RFPs. As I mentioned earlier, if the tap of capital equipment really opens, this is going to be a massive opportunity for all of us. And I'd say Mac because the water is just waiting for the tap to open, and then it's going to become like a totally different story for tool provider.

So that's kind of really a long answer to a short question, but across the board how we're seeing order intake and how we're seeing a different part of the business between consumable and hardware.

Your next question comes from the line of Paul Knight with KeyBanc.

When you look at the China market right now, is this domestic demand or is it multinationals expanding their bioprocess capabilities in that market?

Paul, yes, I have to say at this stage, the vast majority, and I say last majority, at least what I have a good line of sight of is really China, local demand market that's coming back. And we've had a lot of successes. I mentioned mixers already a couple of times. But beyond mixers even on our filters, consumable and so on, we're seeing a lot of these customers coming back now. As you know very well, we are facing much more competition than we were before, which is why we've been pushing and now implementing that strategy that I think it's very different, very differentiating as well versus what others might have been doing, where we are really going to capitalize on local company to help us gaining our market back.

I've said several times, the China market today is totally different than it was 5, 5 years ago, even maybe 3 years ago, even to a certain extent, you want to subsidy in China, you have to appear to be much more really Chinese than you were before, and that the only way you're going to be able to defeat competition locally. We found a part that we like a lot because we know the management team pretty well, but also they are still in the early phase of growth. And I've seen so many of these companies being successful over the last several years that collaborating together, we feel we have got an incredible runway over the next several years. But the demand is really from Chinese company Chinese local demand, which we know is going to grow very significantly over the next several years now with all of the money that has been injected into the China ecosystem.

Your next question comes from the line of Brendan Smith with TD Cowen.

I wanted to actually ask just another one on the transformation office a bit. Any more granularity on what kinds of margin optimization efforts you really have going on there? I guess are you focused on certain segments more than others? I know you mentioned some AI process involvement. So I guess just wondering if there's any potential for some of the relative margins across your different segments and maybe close ranks a bit from some of the historical spread we've seen?

Yes, Brendan, good question. So we highlighted kind of 4 buckets. One is manufacturing footprint in terms of how to optimize that. So that, of course, will hit either different product lines or help us drive efficiencies across the overall network. The other piece, to your point is really this improving profitability on certain product lines. So that's examples of where do we look at our portfolio? What's dilutive to the overall average? And how can we look at design changes? How can we look at manufacturing efficiencies, to your point, how do we look at the the product SKUs that we have to try to raise that overall.

And then it's things like Polymem, again, where we saw that a noncore product, not even within bioprocessing and not only dilutive at the margin, but a loss at the bottom line. And so that's fairly unique, though. So just to caution you in terms of opportunities at that level, but it's absolutely about finding the below-margin products and then increasing those.

The other pieces is also around how do we serve our customers better, how do we get more value. So again, you might see that within the product lines. And then the other big bucket is this topic of IT modernization as well as AI. And we kind of keep them connected but also have a very different path on each of those. We've talked a lot about the need to to upgrade our IT infrastructure.

It's data, I'll say, optimization -- it's looking at the -- when you look at the number of applications and vendors we have for our size company, we can rationalize that. That's the type of thing that actually drives synergies and cost savings. But always bring, how do we leverage SAP, our ERP as well to to get more out of that. And then from an AI perspective, it's a balance of looking at the tools that are available, but then also going back into each process and function understanding the problems that we're solving and the use cases for those AI, I'll say, solutions. And so incredibly exciting for us.

Again, this is about allocating the right resources focusing internal experts as well as bringing external experts to help us accelerate that. And again, it's just another example of kind of the long game that we're playing on both margin expansion as well as being able to grow in scale.

Your next question comes from the line of Matt Stanton with Jefferies.

Maybe just one in the context of the order commentary and then the kind of high probability funnel that you laid out, Olivier. Can you just remind us in terms of your equipment portfolio and the order book there, how quickly you turn that? I think historically, you had kind of talked about earning 2/3 of the order book in 6 months or less. I think it would be helpful to kind of get an updated number on that given the evolution of the portfolio as it relates to about what could maybe show up in orders today and income and revenues in the back half of the year versus 27. It sounds like mixers, analytics, some of those are maybe shorter cycle type equipment than the larger projects you talked about late but would just be helpful to kind of level set the order book, how quickly you think you can turn that today and how that maybe has evolved from a couple of years ago.

Matt, I think you answered your question very well. So I'll try to add some more details here. But you're absolutely right, like we've got very different type of hardware in our portfolio. So the 2 you mentioned, you're right, both mixers on the one side and analytics on the other side, turnaround time is very short. I mean, in fact, for analytics, typically you can even turn around an order within a couple of weeks. So for mixers and here, I would differentiate what we call the stainless steel mixers, which is what we acquired when we 5 years ago from the single-use mixes, this time are slightly different.

For the stainless steel side, we are like below 3 months. for the single-use mix, we would probably be a little bit more than 3 months. And so there is a slight difference here. and then comes what we call well, even within the larger scale type of hardware, there is still a difference. For ATF, system very often we are capable to turn around delivery in 3 months or even less some time if we've got no customization to achieve for downstream system, whether TSF or Chrome system, it really depends again whether it's catalog type of product or whether it requires some customization.

If it's catalog, turnaround time can also be in the range of 3 months. also if it's custom probably more into the 5 to 6 months range. But what's becoming probably more important than our own lead time is really customer preparedness. And especially now that we start to enter into these onshoring projects more and more we will see probably very different cases where people already have brownfield or people need to build everything from scratch.

And then this is what we don't control fully where our lead time might be absolutely enabling us to recognize those revenues this year it might well be that those sides are only ready by mid of 27% or even maybe second half also.

And as you know, when I mentioned about the blockbuster, we had -- we won a couple of years ago now on ATF, I mean it's a specific example where the customer size is still just being finalized right now. So what we don't control fully is customer preparedness and especially with ensuring that, that's something we're all going to have to figuring out better in the upcoming few quarters here.

Your next question comes from the line of Matt Hewitt with Craig-Hallum Capital Group.

A great start to the year. Analytics is becoming a much bigger demand area for your customers, whether it's the CDMOs or the pharma companies. You're seeing increased demand. You're speaking to some of the growth that you're seeing there. From an investment standpoint, -- where do you see opportunities to invest in that area, whether it's real-time monitoring or taking some of the data that you're capturing and kind of helping your customers identify areas for improvement. Is this an area that you're investing internally is an area that you see from an M&A perspective, maybe augmenting some of your existing capabilities? Any discussion there?

Yes, Matthew, great question. I mean, obviously, as you mentioned, we're really excited about the traction we're seeing on process analytics. I mean, 50% growth in quarter 1, 40% organic credit, downstream analytics. I mean we've never seen that before. In fact, historically, quarter 1 was always a weaker from a seasonality point of view. So that was really obviously an incredible performance.

And you're asking absolutely the right question, what are we doing to make sure we capitalize on that and we even can double down on that over the next several years. So first of all, you know, we said that upgrade cycle is just still at the beginning. So going to be a tailwind for us for the next several quarters, if not probably several years. But beyond that, and I didn't talk so much about the PAT side, the PAT has got huge traction as well. I mean -- as you know, we launched our FlowVDX in-line protein concentration technology 1.5 years, 2 years ago, so which has got incredible traction while working on multiple other PA technologies product grade or product launches that will happen over the next 1 to 2 years.

So talking about investment and talking about organic investment, we're investing a huge amount of money on the R&D side to make sure we've got many more products on our shelves over the next several years. but both from an app line but also from an in-line point of view, and you will hear us tell talking about that massively over the next several quarters and years. And then, yes, in terms of M&A, absolutely.

I mean, as you know, capital spending top priority #1 for us is on the M&A side. I mean we ended quarter 1 with $785 million of dry powder. So we are looking at several opportunities, and it's the right Polymem on the Analytics side to complement our offering further so on, we would be very interested.

So the last piece I would mention and services are benefiting from that grandly as well. I mean our service business grew more than 3% in in quarter 1. And the good news is we've got a very nice attachment rate of service to our analytical equipment. So that's another area we're investing into quite a bit and then partially for that piece that is linked to the analytical business here.

Your next question comes from the line of Justin Bowers from NJ.

It's Deutsche Bank, but I'll squeeze a multiparter into one. So on the proteins, pretty strong quarter, especially against a tough comp. Can you talk about some of the drivers there? And then -- is that more of a shorter cycle business, i.e., how much visibility do you have into that? And then over the next 2 to 3 years, is that a franchise that you believe can continue to grow above Fluid average.

Justin, Happy to have a question on protein because that's another business. I'm so happy about the progress we're seeing here. So yes, you're right, I mean, meeting growth lapping on what was a very strong quarter 12025 was a really great positive surprise for us. And honestly, we got demand across all our offerings, but partially on the legal side. I mean I mentioned in the past we've really become closer and closer with Purolite. We work really very much hand-in-hand together they have fantastic traction, and we are very happy about the way we collaborate together. That has been one of the reasons why protein did so well.

So we are in the long-term type of business here because beyond that specific collaboration the fact also we have our date in our hands for all of the non monocular antibody side of the business is also very encouraging because we are winning multiple and we say multiple is really multiple designing. And it's a business that takes a little bit of time because where you first need to get designed in and then you start to deliver some first pilot quantities.

And then hopefully, some of these products are either making it to the market or if they are already on the market, people are -- our customers are going to put the trigger to switch from one supplier to us. But with all of the designing we've been working on, and we've got a dedicated team that is going on the market, getting fantastic response from the market because they've never seen a company capable to develop a new lean in 3 months and month.

I'm absolutely very bullish about that market for the next several years. I think the best is still to come here for sure.

We have reached the end of the Q&A session. I will now turn the call back to Olivier Loeillot for closing remarks.

Thank you all for joining our call today. We had a very great first quarter, and we're executing against the plan we've outlined which is outpacing market growth, delivering margin expansion, and Jason gave you a good number of details about what we're achieving on that side; and finally, making tangible progress on our strategy. I really want to thank all of our Repligen teammates. We have an incredible team, and we are delivering a fantastic start of the year and looking forward to talking to you again in a quarter from now. Thank you all.

This is Paul Knight, life science analyst at Repligen. And with us, we have Jacob Johnson, Head of Investor Relations; Jason, Chief Financial Officer; Olivier, CEO. We all very familiar with Repligen management. In fact, when I first met them at $3 a share, it was in the building I'm sitting in right now at 1301 Sixth Avenue.

So they've come a long way. And Olivier, you've been there -- you've not been there forever. What are your impressions now as the CEO a bit of how Repligen is positioned and how this market feels to you?

Yes. No, that's a great question, Paul. I mean I've been here for about 2.5 years now, CEO of the company for 1.5 years. I mean, I'm obviously more excited than ever. I mean we have a very unique and very broad offering at the same time. And with our very intense commercial strategy, I mean, we've been very successful over the last couple of years to really get more and more closer to those big companies and getting them understanding we have a very broad portfolio of products.

You know very well, like innovation has always been really at the core of our DNA, and we're still doubling down on innovation as well because we really want to make sure we are helping our customers to improve their yield, increase their -- sorry, improve their cost of manufacturing and so on. So we are really extremely well positioned and excited about what's coming for the next several years here.

We just mentioned innovation, which I think is like a cornerstone of what Repligen is. I think 80% of your portfolio is differentiated. Could you just touch on what makes your product so differentiated? You said yield improvement. So that's definitely important. But on the other 20%, is there ways you're trying to add, whether it's analytics or other technologies to differentiate those offerings?

Yes. No, good question. And so on the 80% where we are really differentiated, the reason is simple. I mean we've always make sure that our R&D team was focused on what doesn't exist and what customers are looking for. I'll pick up two examples here, which are two of the historical product line, ATF on one side, pre-packed column on the other side. ATF, people have been telling us for a decade now, we need a process intensification technology.

I mean we want to be able to get more out of the same footprint. So that's what we've developed. That's what we've launched. We're already at the second or third generation of that technology, working on the next one. That's a perfect example. Pre-packed column is another one. I mean back 15, 20 years ago or so, I mean, most companies were hiring people who would pack column for their entire life. Now they just don't find those people anymore because a young generation wants to pack column for 3 years and then do something else. So really working with a company that has got decade of experience doing that and packing thousands of columns is absolutely a big, big advantage for those companies.

So on the 80%, and you could mention PAT, you could mention the vast majority of our portfolio. Where we have more direct competition and the usual portfolio segment is obviously fluid management, we are still trying to differentiate ourselves. And here, you would think about differentiating yourself via better service. I mean, being more customer-centric, whether because you're offering better lead time or maybe also because you're really offering better customer service.

And it's fair to say even though fluid management, single-use technologies have been implemented now for more than a decade, there are still several challenges with that technology like extractable and leachable, leakages and so on. We are really trying to make sure our customer service team are closer to our customers so that we really differentiate ourselves on that side. So it's really, really whether we've got very differentiating products or for the 20 person making sure we are more customer-centric, making sure we offer better service than others.

Yes, that makes sense. I never thought about the 20% with the service side, just like being able to serve your customers maybe more closely than a bigger competitor. But it just seems like your portfolio, whether it's ATF pre-packed columns are really resonating with customers on the pharma side, on the CDMO side. Could you just walk us through some of those customer wins and what's really motivating these customers? Is it a product? Is it your sales forces they really know their products or cost-saving metric? I think that would be helpful to hear.

Yes. No, as I mentioned to Paul earlier, I joined about 2.5 years ago. And I can tell you the visibility we have with big pharma accounts and big CDMO as well today compared to what it was 2.5 years ago. It's almost day and night. I mean it's fair to say like 2.5 years ago or so, those big companies, they knew us for maybe a couple of our product line. Now they realize we probably have one of the broadest, I want to say, probably one of the top three broadest bioprocessing portfolio in the industry today.

And really, during the last 2.5 years or so, my focus with the commercial team and the product management team is to make sure those customers understand the breadth of the portfolio we have. And I think we mentioned a couple of months ago or so that in the last 5 years, the amount of product line we've been selling to those big accounts has multiplied by a factor of 2.5. So that's a great sign like people really, really understand that we have a much broader portfolio.

And we're at a point, in fact, where we are starting to even package all of our technologies together and then working on a full solution offering so that for some of the specific customer needs, but potentially some of these specific modalities now beyond pitching all of the different parts of the portfolio, now we come and say, we almost have a full workflow for you. And if for whatever reason, we might miss one or the other part of that workflow, potentially articulating how we can still support customers with that full workflow. So this has been a huge evolvement of our selling in the last 2.5 years or so.

But the good news, we are still at the beginning of that process. And I think we've got incredible tailwind for the next several years because people are just starting to understand the breadth of the portfolio we have today. Another good example here, a nice, we have now such a broader offering on the equipment side that where we were not getting a seat at the table up to probably 6 months ago. So now we're getting involved in probably 80%, 90% of any big RFPs that are coming out because think about it, 2 years ago, so we mostly had the ATF hardware offering. Then we added all of our downstream system, both TFF chrome system, and then we added now the mixers more recently. So we have almost 80% of whatever equipment are being needed when a company decides to build a new bioprocessing plant, and that's a fantastic opportunity for us as well here.

When you say equipment, Olivier, do you mean -- would that include ARTeSYN?

Absolutely. So ARTeSYN is what I call downstream equipment, which is both TFF and chromatography system. And we have had, as you know, really good traction on that side over the last couple of years here.

I was reading an old industry report that said it in the bioprocess industry, 40% of market was equipment, 40% is single use polymer bags and then the remaining would be media and other. Would you still be a good number?

I'm not sure, honestly, Paul. And I mean, obviously, there are so many different studies coming out and so on. So if you talk about a brand-new site where people need to build and buy all equipment and so on, yes, it's fair to assume like overall, at least for the first 1 year, procurement is going to have a big part of it coming from equipment and so on, absolutely.

But once the plant is up and running and so on, the part -- the percentage of the equipment is much lower than 40%. I mean -- and if you look at the four big guys, but even to a certain extent, ourselves, I mean, most of us have the vast majority of our sales on the consumable side, up to probably 75%, 80% of sales going on the consumable side. So where your number would potentially make sense for a site that is being built, and that's probably where the onshoring topics would be a good one to reflect on the number you just said. When you're more talking about a well-established operation and so on, consumable component is much bigger than hardware for sure.

Then Sartorius, as we were talking earlier, talk Tuesday about, I think, 9% to 12% growth this year themselves or market growth. You're similar. What's your overlap with Sartorius?

Yes. No. I mean we -- I'll start first where we collaborate together. And I mean, as you've seen and we've talked about several times, I mean, we're collaborating with Sartorius on the ATF side. We've been working -- our two teams have been working together now for several years, and we're, I think, very happy on both sides about the collaboration where we are learning from each other and what needs to be done to improve further this process intensification capabilities and so on.

Beyond that, obviously, yes, we are -- it's one of our, I call it, good competitor. I mean it's a very good, very high technological company and so on. We don't have that many overlaps, honestly, Paul. We have a little bit on the fluid management side, but they are much bigger than we are. I mean we're a very small actor in the field versus where Sartorius is. And then we have some overlap, but limited as well on some of the downstream system and so on. But overall, we've got very little overlap with Sartorius.

I wanted to talk about how some of the tailwinds that we're seeing that you've mentioned are translating to your top line and just momentum in general. I think in '25, correct me if I'm wrong, but I think you raised guidance twice and also beat the high end of that range. So sitting where we are today, what do you think played out differently versus what you originally expected? And then we can go into more of 2026, but would love your thoughts there.

Yes. No, absolutely. And I was about to go to '26 first because interestingly enough, our guidance for '26 is very similar to the guidance we had at the beginning of 2025. But we will come back to that for sure later on. I mean, one thing I've learned over the last 30 years being in that industry, Anna, is you need to have a very broad portfolio of products.

And beyond having a very broad portfolio of products, you need to have a very broad portfolio of opportunities with customers because, I mean, I would tell you, like in 30 years of working experience, I don't think I ever delivered the budget the way I thought I would on January 1 because you always have good and bad surprises. But in the vast majority of the case, you deliver your budget because you have all of these opportunities. And if for whatever reason, you get some headwind, you're going to be able to compensate or even more than compensate for it.

And the way 2025 played out was a perfect showcase example where when we enter into the year, we had no clue like we would get that new modality headwind that we had finally in the course of 2025. And we didn't know either that somehow our biggest modality, our biggest franchise, filtration would be the one suffering the most from that specific headwind, but that the other three franchises would be doing much, much better than we thought for multiple reasons.

So again, this is the beauty of having a really broad portfolio of products and having what I call the best-in-class sales organization because that's enabling you really to rebound and you've got so many opportunities that you're going to grab them. And you've heard me saying several times, the funnel management is critical as well, which is we're operating typically with 4 months of backlog. So it's good, but it's not huge. The only way you're sure you're going to deliver your years is because you've got a very strong funnel and then you need to just be able to succeed on translating that funnel into orders.

So last year, if I just have to pick up two, I mean, because three really performed very well, but I just pick up maybe two, which is protein on one side, incredible success story for us last year. I mean, you know like '24 was a horrible year for us because we almost lost -- well, we lost really two of our two historical OEM companies, customer and so on. And we had to reinvent our business completely. I would never have thought we would have so much traction so fast and be able to go back to the level we were before we lost those two OEM partners.

The good news today is we have our destiny in our hands and the best is still to come because now we are on a much broader range of customers on that side and which are end customers, meaning we don't have this type of intermediate situation that we had before. And then the second one is analytics, where when we launched a new SoloVPE PLUS, I'll tell you very honestly, I mean, I didn't realize how much traction we would really have. And I mean, it went beyond our expectation.

Again, good news here. We are just at the beginning of the cycle because we replaced less than 10% of the installed base. That's going to be another tailwind for the entire year. So again, being broad, brought from a customer point of view, from a product line point of view is what has enabled us to over deliver last year and what will enable us, among other stuff, to overdeliver versus market for the next several years as well.

Yes, that's great to hear. And the SoloVPE was definitely a good upgrade cycle and good to hear it should continue in the next coming years. But I just wanted to -- I have some more portfolio specific questions, but I thought maybe for Jason, if we could just hit on some of the margin targets taking a step back, not looking just at '26, but over the long term, where do you expect margins to trend? And just what are some of the levers to get there?

Yes. So we've been pretty clear and sharing often that our target is to get to, call it, a 30% EBITDA, and that's probably 25 plus or so at the EBIT level by 2030. And -- but we've also been sharing that when you look at that trajectory, it's probably a smaller step up over the next couple of years and then accelerate as we grow scale and able to just find or benefit from more, I'll say, leverage, right, on the structure we've got.

I think when you look at the path that we -- to get us there, we're certainly going to continue kind of think about the elements of the P&L. We're going to continue to be able to capture price, right, value-based selling in our markets. We'll certainly get volume leverage. That price will be able to effectively offset the inflation we have, right, and maybe a little bit more. And then we'll continue to deliver manufacturing productivity. And then the other piece that effectively would be a part of volume leverage, but it's worth calling out, it's really then the leverage we get from growing our operating expenses at a rate lower than our top line, right?

And really being focused over the next couple of years, in particular, on investing in our Fit for Growth journey, ensuring we've got the right people and processes and infrastructure to get there. And then as that builds out, again, we feel like the investment on that will require lower amounts as we get into, call it, '28, '29, et cetera, and '30. And so that's really the model that we're driving. We delivered I think really strong margin expansion in 2025.

If you take out the impact of M&A, and we expanded EBIT margin by 240 basis points. And so we've guided 150 for 2026. And I think we're going to be able to kind of demonstrate that continuous expansion here over the next few years.

That's great. It seems like in the short term, more investments, but it will drive top line growth as we look out to 2030, and that's good to hear. I thought maybe we could look at some of the product lines Olivier was talking about earlier. Maybe on chromatography, I know historically, CDMOs have been quicker to adopt the prepacked columns, but now we're starting to see some pharma customers. I think you had 2 pharma wins recently. So could you talk to us about the funnel on the prepacked column side? Are those mostly pharma companies? And how long does that usually take to convert those customers?

Yes. No, I mean, you phrased it right. And I mean, historically, the value prop was particularly attractive for CDMOs. I mean think about it, when you're a CDMO, you have to be agile, fast to react because you're not 100% sure what you're going to have to manufacture when you're entering into a new year.

So having prepacked column on the shelf is a great advantage because you are capable to react really fast if needs be. So -- and it's fair to say, really, we're still having a lot of traction on that side where some of the CDMOs who were maybe mostly using small-scale prepacked column in the past are moving towards using larger scale, which is one of the reasons why we've seen so much growth last year because they realize they really like the concept a lot.

But beyond CDMOs where we've had traction for several years, now it's really about making sure we convince pharma companies to switch. And for pharma, it's slightly different because if you run a pharma manufacturing plant, normally, you have a pretty good idea what your manufacturing plan is going to be during the year. So more than really having the agility, flexibility to move to another product faster, which is what we talked about for CDMOs, it's really more about having the expertise in-house.

And I alluded to the fact it's difficult now for those companies to find people who have got a decade of experience packing column. So when you think about the risk of contamination, the risk of losing a huge volume of resin, which is very expensive and so on. I mean, slowly but surely, a lot of these pharma companies start to realize it's probably very good to consider using pre-packed column to reduce all of those risks. So we had really good traction last year. It keeps on going this year, in fact.

And last year, we said we won two new customers. It keeps on going this year. I mean it's -- we have a product line where we know we've got still a lot of potential growth for the next several years, and we see new customers popping up quite regularly on that side still. So yes, they're very exciting. I think we've got a great runway. I mean, column packing is a real art. And I mean -- and bioprocessing is an art, but column packing in particular, is a real art and you can't like suddenly be as good as a company like ours with packing more than 3,000 columns every year. So we've got incredible knowledge on that side for sure.

That's really interesting. The fact that talent plays such a big part of why your share in the pre-packed column market is probably irreplaceable.

Can I jump in here on that topic of talent. I'm sure that when Repligen in the early days was acquiring companies, it was also the game direct salespeople. Now it seems -- I'm guessing you have the size that you can compete with any firm in the industry on recruiting talent. Is that a fair assumption?

No, it is, Paul. I mean -- and I have to say, I mean, we've had the chance to really hire more or less anybody we really wanted to hire over at least the last 2.5 years I've been here. I mean -- and then a lot of people who have got the decades of experience.

I mean, when we talk about getting fit for growth and investing in talent and so on, I mean that's definitely one big part of it. I mean, and really across all of our functions, I mean, obviously, I started mostly on the product management side and commercial side when I joined initially in October of 2023.

But in the meantime, we started to do the same in many parts of our organization from finance quality, including services, including IT more recently and so on. So we are really bringing talent that have been working in that industry for a long period of time because as you know very well, Paul, it's a bit of a unique industry where know-how is very important.

I mean whatever function you work for, I would even mention HR on that side, you're looking for very specific talent that ideally know exactly what is important for customers and so on. So -- and we've had the luxury to be a pretty attractive company for people who see the bandwidth we have and who sees like, yes, we are definitely smaller than some of the big guys, but this come alongside also potentially more opportunity for growth and then more opportunity to really focus on what people think is really important.

And just on proteins, I think that's another interesting area where strategy has kind of shifted in recent years. I think you're launching a bunch of resins, custom resins for customers. Could you talk about how the business is set up for 2026. Are there new resins launching? Are these new resins higher in margin? I know there was some difference in margins, but that would be helpful.

es. No, absolutely. And I mentioned earlier, I'm so proud about how fast and how successful we've been to pivot that business because, I mean, I don't think there are many, many examples where you're losing suddenly to such huge customer of your business and you're capable to rebound like that. And what we've done, we really work from different side here. And so first of all, it all started with the acquisition of Avitide, which was about 4, 5 years ago or so, which just gives us the opportunity, the ability to develop custom ligand in 3 months.

And I tell you, nobody else is capable to do that. I mean -- and in fact, what a lot of these big pharma and CDMOs have understood over the last couple of years is there is finally now a company that is capable, which is probably 5 to 10x faster than anybody else is capable to do it. But then obviously, if you really want to play a role on the full offering, which is resin, you need to have the bids as well, which is why we acquired Tantti in our year-end 3 months ago or so -- and not only the technology is beautiful, but for new modalities, I mean, it's giving us what I think is probably the best combination of the best ligands plus probably what is the base metrics for new modalities.

So that's why we have a combination of catalog product launches that have got great traction, but what people don't see is we work on multiple -- I say multiple, it's really a big number of custom projects for those big pharma and CDMOs where we also have incredible traction. And then the last piece I would mention and not to underestimate, I mean, we've been collaborating with Purolite, as you know, on the monoclonal antibody side. The collaboration is closer than ever, and we are absolutely delighted about the progress we are achieving together.

We will strengthen that collaboration over the years and that is also functioning extremely well. So very excited about protein. I mean, as you know, I'm always excited about my portfolio -- that's really one where I think we've got also incredible runway for the next several years here.

Yes, that's great to hear. And it's certainly been a cool transition to watch from the outside. And I want to talk about the process analytics portfolio. I think you recently merged the C Tech sales team and 908 devices. So now it's like a more unified portfolio of process analytics, both upstream, downstream. What would the time line look like for you to start pitching as to large pharma accounts, just a unified system level, upstream, downstream process analytics portfolio.

Yes. So we have merged the sales organization already. We did that in July of 2025. So we're about 7, 8 months into a merged sales organization. This has definitely benefited the funnel of 900 grandly because now, I mean, the sales team size is something like 5, 6x bigger than it was when it was independent. So obviously, this is helping us to generate massive improvement in terms of funnel for the 908 offering. So this is already happening.

Where I think your question is particularly accurate and now is we are just at the beginning of that digitization journey that we are talking about because now between the FlowVPX, we already had in our hands, plus the four technologies we added from 908 plus one or two extra one. One of them, as you know, is the one we acquired from Delight several years ago. So that has taken us a little bit of time to develop. But now thanks to the know-how of the 908 R&D team, we've progressed very fast over the last 12 months to develop that MIRA technology that will be launched probably towards the end of this year.

We have really 6 and probably very soon seven PAT technology. So now the question is how do we aggregate all of these together? And how do we make sure like beyond selling each of them one separately to the other and so on is how do we make sure that people -- our customers understand the real most advanced PAT provider in the industry is Repligen and how do we make sure we give them a chance now to aggregate all of the data they are collecting from our technologies and making sure and you see it coming, they can also use AI and type of software, software that will enable them to really develop their processes much faster on the one side, run their operation more efficiently on the other side.

So that is our path forward. We -- as you know, we took minority investment in an Austrian company called Novasign last year, which is somewhere between pure PAT and AI. It's really more what is called digital twin, which is somewhere in between. We're working on a couple of other opportunity here, but the idea is to be really leading the pack for our bioprocessing customers in terms of AI enablement so that they run their operation much better in the future. And so we're at the beginning of that journey right now.

Okay. Perfect. That was very helpful. I think maybe we could spend a moment just touching on 2026 guidance, visibility around that and also some of the assumptions. I think CapEx is something that's been muted for a lot of players. What are your assumptions around CapEx in '26? And are you seeing an improvement on that side?

Yes. So and I mentioned it earlier, it's interesting because when we work on our guidance for 2026, we look at all of the guidance we had in 2025, it's really towards the end where we realize, well, in fact, it's extremely close to the guidance we had a year ago with the result you know. But at the same time, we said it's probably the appropriate guidance for the time being. And remember, our framework has always been, say, plus 5%, at least plus 5% versus market. Last year, we did much more than plus 5%.

I'm not sure exactly what the market landed, but it's fair to say we need much more than plus 5%. This year, we said it's going to be plus 5%, minus 2% because of the headwind we have on that specific gene therapy program. So -- and then at least from what we heard so far, I mean, it looks like peer commentary at the beginning of February also was like we would be more towards the lower end of the market growth we've been talking about for 2026, which is probably more into the 7%, 8% growth for the market this year.

So if you make the math, I mean, in fact, our midpoint of the guidance is still a little bit above 5% above what some of the peers might have mentioned about market growth this year. So we think it's an appropriate guidance, and you pick up one of the good topic, which is the CapEx spending. I mean -- and as you know, we did probably much better than several others last year. I mean, our CapEx -- our hardware business was in 2025 versus 2024, where at least one of our direct competitor mentioned being down high teens in 2025.

So we definitely did better than others. But it's -- we agree with others that CapEx spending has not been back yet to the level we would like to see it. And that would be definitely something I think all of us, including ourselves, are hoping to see happening more this year accelerating because that will become a huge tailwind. So we're absolutely confident once the tap is open, it's going to become a huge tailwind for everybody. We would just like to see that happening a little bit faster.

But again, this year, we are absolutely confident we are going to have a very nice growth it's fair to say like from '27 onward, we think really growth will accelerate further again because of all of these tailwinds we are seeing. A couple of other topics are obviously a small biotech. I mean as you know, we've had three really good quarters in a row. I mean, of order intake growing really nicely. Interestingly, this came at the same time kind of toward the end of the year where funding became much bigger as well.

But we've always said normally, funding doesn't come to those companies in the first 6 months. So you would think that combining the rebound we already saw plus hopefully, in our money reaching those customers, that should be potentially another good tailwind for the industry as well. So we are watching all of this stuff. I mean, I mentioned about MFN, so-called MFN digestion and FDA approval. That's the last piece. I will just repeat again once more here, partly FDA approval. I mean, we are now, what, 18th of March, I mean, there have been almost no biologic drug approved this year. I mean that is something we want to see improving because where it might not have a huge impact in the very short term.

I mean, for the pharma ecosystem, it is important to see FDA approval. I mean, it's absolutely critical because this is restoring confidence from the entire ecosystem to invest further and then to push for more innovation across the board. So that is something we want to see improving as well and now, but we are still very confident for the future.

Olivier, Jason, Jacob, we really appreciate your time today. I guess the closing question I would have, Olivier is a lot of things were pretty negative last year, I guess, for pharma, discussions with the FDA or the new Head of FDA, et cetera. Tariff pricing. Is that -- was it as bad as that talking to pharma last year?

No. I mean, obviously, and I'd like to do a parallel between the rebound with seat Big Pharma about 2 years ago or so, then we saw CDMO rebounding a year ago. And now finally, we're seeing small biotech rebounding as well. So from a customer segment point of view, you want to say like everything is much, much better obviously than it was 2 years ago. Much better than a year ago. And then we're obviously very excited about all of that.

We want to see a little bit how those MFM deal plays out. I mean we know like a lot of things are going to happen. We still believe like we want to see people pulling the trigger now and saying, "Hey, do I really now push the onshoring button full speed and then we're going to be entering into what's going to be an incredible growth cycle for probably several years." And we just want this pattern to be pushed. And then I think everybody will feel like extremely bullish again.

That's the only thing I think everybody is waiting for at this stage, plus a bit more FDA approval as well, Paul. But yes, am I optimistic for the future of bioprocessing? Absolutely. And I think we're going to have several years of very nice growth in front of us here.

Thank you so much. Thank you, Jacob. Thank you, Jason.

Thank you, Paul.

All right. Great. Welcome, everyone. I'm Puneet Souda. I cover life science tools and diagnostics here at Leerink. And it's my pleasure to be hosting the Repligen team, CFO, Jason Garland; and also Head of Investor Relations, Jacob Johnson, joining us. Great to have you guys here in Miami.

Good morning.

Thanks for having us, Puneet.

Yes. Okay. Excellent. So maybe always exciting to talk about Repligen, a number of things you have ongoing for you in the markets, strong clinical stage presence that you have and in commercial as well. So maybe -- but let me kick off on the 2026 guide. You framed it as 9% to 13% organic growth rate. And then you pointed out the 500 bps outperformance framework relative to the bioprocessing end market, offset by 200 bps of headwinds from gene therapy. Maybe just give us a view on that sort of 9% to 13%. It was a bit wider than usual historically, but maybe could you walk us through the puts and takes? What takes you to higher end of that guide versus lower end? What was the thinking behind it?

Yes. No. So we had a really strong 2025. So the momentum continues into '26. We've got a great order book that we ended as well with fourth quarter. I think to your point, the midpoint of that guide is right within the framework that we've been talking a lot about. I'm not sure your history, but we look back the last 5 years, and we've always -- we've given 4 points of range kind of coming out of the gate every year. So we actually saw that then if you stick hover around that 11%, plus or minus 2% was a typical range that we've given on the organic side.

I think the -- to answer your question, if the pipeline of opportunities that we see continuing to grow is able to execute and convert within the year, that pushes us towards the higher end. And the things that I'd say we're watching are certainly pharma digesting MFN, what that really looks like, FDA and approvals and how that plays out. Those are the things that we're watching that maybe leads us towards the low end. But overall, we're really excited about the pipeline that we've got, the opportunities and again, well within this framework of being able to deliver above-market growth.

And a couple of macro factors that you referenced as well, MFN policy, I think Olivier mentioned that and pharma CapEx timing, FDA biologics approvals as variables that are obviously out of your control. But remind us, I mean, yes, pharma CapEx, I think CapEx is well understood. But generally speaking, biologics approvals are headed in somewhat of the right direction. MFN policy is somewhat behind. So just trying to understand sort of how much of those factors are still playing a role in this overall guide?

Yes. I mean for '26, the approvals, of course, probably have less of an impact or it's later in the year, right? I mean we're not banking on the view from where we are today with approvals. It's more of an indicator of that overall market activity. So I think it really becomes back to the CapEx timing, right? And does that continue to improve from where it is today. And that, again, helps us to do -- to go to that higher end of the range. But the approval side, again, takes a little bit longer to flow through.

Okay. Two things that are still external factors, you could say. One was a recent departure at CBER. And we're seeing -- obviously, some of the more new modality levered names and the therapeutics reacted to that yesterday. But just wondering if you had any sort of conversations, what this news means for you and your customers, at least in the new modality. And remind us what's that level of exposure that you have there?

Yes. So just in terms of new modality exposure in 2025, new modalities was about 16% of our revenue, and that's cell therapy where we saw strength last year. Gene therapy, which we do have a headwind in there that we've talked about. But I think outside of that held up relatively well last year. And then we did see some headwinds on the mRNA side of things. So that's that piece of it. The news you referenced, look, we're not in the business of drug development, and it's pretty recent. So I think it's really too soon to say other than I think anything that reduces uncertainty for our is probably a net positive for us.

Got it. And then another one that's obviously quite a few moving targets that we've been -- all of us have been dealing with. But with the conflict ongoing, there is a question of shipping in terms of cost of -- obviously, oil price and inflationary pressures as a result of it. How does that impact shipping of instrumentation, consumables? Maybe just talk to us about that because obviously, you're shipping globally as well.

Yes. So first, from an exposure within -- sales within the region, it's de minimis. And so again, that doesn't really come into a big play. When we are shipping product from Europe that we manufacture there into our customer base in Asia. That's what typically might go through that region. Obviously, we've spent the last several days, I guess -- yes, it's still been days now here. It seems like a long time, but finding routes around that. So you're right, there may be some inflationary pressure on it, but nothing that we feel like is going to be that meaningful that we need to call out. So the team is all over it in terms of meeting the customer delivery commitments and their requests as well as finding safe passage through to the region.

And in terms of just on the 1Q guide, you indicated 1Q revenue should be down only low single digits sequentially versus 4Q, and that implied about a 10% organic growth at the start of the year. Maybe just talk to us in terms of your level of confidence in the strength of the 1Q exit run rate relative to the typical seasonality. And with this conflict in mind, anything that we ought to consider in terms of shipping delays or booking of revenue sometimes as those products go out the door?

Yes. Look, we think we're in a great position in 1Q to then be able to deliver and establish a great step forward to meet our total year guidance. So we tried to indicate some of that on the call for earnings that the strong fourth quarter orders run rate translated to a steady I'll say, backlog, if you will, to execute in 1Q. We're executing that. Again, we're managing some of the puts and takes within the Middle East traffic. But overall, I think everyone should know that we're expecting to start within that framework and put a good foot forward for the year.

Got it. And since you mentioned orders, I mean, maybe can you talk a little bit about the order book? Any sort of recent feedback that you're getting from the field in terms of just sort of, again, orders first and foremost, I mean, in mind for investors, just given the...

Yes. And I guess I'm speaking out of both sides of my mouth because I've referenced orders even though I said we weren't going to be really quantifying that anymore as well as book-to-bill. But -- and again, we'll focus on revenue guidance as a way to indicate that performance. But by all measures, quarter-over-quarter, year-over-year book-to-bill, fourth quarter was a strong quarter for quarters.

Okay. When I look at the cadence this year, first half being weaker versus second half, is that just primarily Sarepta headwind being sort of front loaded? Or is there other considerations in that?

Yes. So I'd look at it, there's kind of 2 dynamics, Puneet. So there's -- we talked about kind of 48% in the first half, 52% in the second. And that's really just more seasonality, right, kind of very typical, we tend to have a stronger second half, particularly from the fourth quarter. So that's very much in line. It's the year-over-year growth rates that is more impacted by the gene therapy. So in other words, that's why we said the second half would be above the midpoint and the first half might be below. That is -- that's where the timing of the gene therapy comes in. That was much more front-end loaded in 2025, so the year-over-year. But on the order of magnitude of dollars, $48 to $52, that's seasonality that is not related to the gene therapy dynamic. Makes sense?

Yes. And I'm going back and forth to a bit, but just on the -- one of the comments, which was interesting to me is on the call, you called out highest probability conversion funnel since 2022 and obviously, strong order momentum there. It seems to imply -- obviously, it implies book-to-bill being at 1, but the question is, how sustainable is that? But maybe just talk to us a little bit about that conversion from -- what's -- is there -- is just normalization? Is there something more to this in terms of how the CDMOs are ordering, the timing and overall, maybe it's pharma. And I'm -- again, looping in another question, which is, is there any early indication of any facility onshoring or anything going on, on that front?

Yes. So overall, again, we've seen this really big -- the strong growth in the funnel. We're getting -- and we've talked about this as well. We're getting a lot more looks at RFPs for our downstream systems, for our fluid management portfolio. So we're continuing to be brought into a lot more opportunities, which again helps to build that funnel. I would say that we're having some onshoring dialogue, but in terms of it converting into opportunities or proposals that's still to come. But again, that overall strength that we're seeing in the funnel isn't only a certain product, it's really across the board.

I think, again, now the dynamic that we're all continuing to watch is how -- what's the timing on how those convert, right? So that's where we still might still be waiting for RFP feedback. We're not getting feedback to say that we've lost or they've moved on, but it's more of a kind of wait and see on some of the things. And so that's really, for us, the switch. It's the convert on this big pipeline, but again, what that timing will be.

Okay. Just a related question on the capital equipment. Obviously, capital equipment demand has remained soft in 2025. Analytics placements were holding up better. But maybe just talk to us assumptions that you're embedding in terms of overall capital equipment recovery. And a number of your products are I mean, in a consumable way, they're utilized over a couple of months or a couple of weeks versus purely capital equipment. So maybe just help us define how large is sort of capital equipment business for you? And what does that entail in terms of overall recovery this year?

Yes. So maybe first on capital, right? So go back to 2025, we wound up the year flat on capital equipment, and we think that was a pretty good outcome in the context of the industry, which at least from what we could see, I think peers were down on capital equipment for the full year, right? So as you think about what we're assuming for 2026, Olivier said, hey, we think low double-digit growth for capital equipment in 2026. But I think there's some nuance there, right? And so -- we talked about analytics growing -- that franchise growing 20% plus in 2026.

There's a piece of that, that's the SoloVPE PLUS upgrade cycle. So that's an opportunity that we think is still in front of us and will benefit us in 2026. And the other piece would be, we think, growing contribution from the upstream analytics portfolio we bought last year. So analytics, I think, is a big piece of the capital growth in '26. I'd tell you, there's also some other benefit from like we launched a new mixer last year. We talked about initial placements this year. So I think there's probably a little bit of benefit from that. I think outside of that, what we're looking for, for the balance of the capital equipment portfolio is, I would say, flat to kind of modest growth in 2026.

Got it. On the point of SoloVPE, I'm wondering if you can -- that's a unique innovative product. You have a unique position there. There is a broad applicability of such a product in the marketplace in bioprocessing. Maybe just give us a view into what -- how large is the installed base, timing of how the installs and how long could that take overall the adoption and replacement cycle?

Yes. I'd say there's, I think, 2,500 units installed base. I think 1,500 of those are maybe 5 years or older, I think, is the rough number. And so that's really what we'd be going after, right, those older units. And so we upgraded about a low single-digit percentage of those units in 2025. I think the goal is to probably do roughly double that, so call it, mid-single digits upgrading of that installed base in 2026.

I think the other exciting thing about this is it's also kind of refocused us on the broader portfolio to understand where are there other upgrade cycles and opportunities that we have. And so that's going to be a major part of sort of our thinking on new releases and certainly into our long-term strategic planning as well, like how do we make this more of a muscle for us.

Got it. Okay. Then maybe just shifting a bit to the end market. I mean you have CDMOs and biopharma versus emerging biotech. Wondering if you can maybe give us sort of the state of union right now that you're seeing across those 3 types of customer bases.

Yes. I mean I think we saw growth out all of them, at least in the back half of the year. And so I'd tell you, like pharma and CDMO performance were remarkably consistent for most of the year. Q4 is a little bit different because CDMOs were lapping, I think, a 40% plus comp. So a really difficult comp on the CDMO side of things last year, but good growth out of both those customer bases. And I think it speaks to what we talked about last year is just the broad-based strength we saw across our portfolio, end markets, customer base, et cetera.

I think as you look at emerging biotech, we saw growth for the last 3 quarters of the year, which is an encouraging development. Obviously, been really good funding trends in 4Q and I think year-to-date on the biotech funding side of things. I think with that said, if you look at the dollar value of those emerging biotech those revenues, we're still below where we were a couple of years ago. And so that's where we don't believe we've really seen the benefit from funding yet. And I think we'd like to see more concrete evidence of that before we say that customer base is completely back. Though to be clear, they still grew the last 3 quarters.

And there's going to be a natural lag in timing, right, between funding and when we might see an ordering converted to sales as well. So I think we're still well within that range. So it's a lot of really great signs and more momentum to come if that funding continues.

And what's the -- historically speaking, what's the -- I'm wondering if there's a time line in which the clinical funding, which was pretty significant in the second half for the clinical stage companies is still continuing? And how long does that take to trickle into equipment?

2 to 3 quarters on average.

For an order and then whether you can then convert it, whether it's in the same quarter or the one after. So you're kind of that 9 to 12 months.

Got it. Okay. Maybe just wanted to touch on China. It's a smaller piece of your revenue, but it's something that Olivier has talked about quite a bit, and you're investing in China. Maybe just give us the -- a little bit about the landscape there because I think after COVID, a number of local firms gained more prominence there, as you go back into it, how do you want to position into China? How do you take the share? And how do you win in those accounts?

Yes. It's an exciting market for us. And again, even though to your point, we've dropped as our total amount of sales. We now have guided and shared that in '26, we'll be back to growth, right? So that's at least that first pivot that we're making. To your point, we've recognized that how we operate and how we'll win in China is going to be very different than maybe what we've done in the past. And that's -- and we've talked very frequently about this opportunity to find local partners in one way. So again, our view isn't okay, we go in greenfield. It's how do we find the right local partners. We're still spending a lot of time betting that, making sure that we've got the right folks to help us both from a local, I'll say, manufacturing and supply chain capability as well as other market access. And so that will continue to be a focus for us.

To your point, we've added a lot of new leaders within the Asia Pac region as well as in China specifically. So we're even still getting some of that halo effect overall in the region. We still believe that we're under-indexed in Asia Pac as a total part of our sales percentage than we should be in the rest of the industry. So we'll continue to really put a big priority there. There are additional investments in '26 for Asia Pac. But again, I don't want to make it sound like we're out doubling the infrastructure, the resources. We're being selective and prioritized in that. And again, finding the right way to find partners. But it's much more than a China story as well, right? It's South Korea, it's Japan, it's India, Singapore. Those are the other regions that we'll continue to grow and focus on.

Got it. Yes. That's -- and makes a ton of sense, just given the prominence of bioprocessing...

Yes, absolutely...

Let me get to margins because, I mean, that's been quite a lot of discussions among investors on that. We fielded a lot of those questions as well. But maybe take a minute and tell us how we ought to think about the overall op margin expansion, not only this year, but more longer term. What are the levers you can pull? Obviously, there is a top line has to be strong and drive some of that, but pricing, maybe on productivity, what are some of the things that you can do? I mean, obviously, for fiscal year '26, I think you're implying 125 bps of gross margin, 150 bps of EBIT margin expansion. But wondering...

Yes. So number one, I just want to make it clear where this is a priority for Olivier and I and the team, right, margin expansion. And I'm hopeful that everybody recognizes that we hit that commitment in 2025 with strong margin expansion, right? I know -- from a reported basis, it was lower. But if you take out the impact of M&A, which, again, to us was a longer-term investment on the technology and the product portfolio that we've been building. You take that out and even take out the good guy from FX and on a "organic basis," we were up 240 basis points of margin expansion for EBIT.

So again, very much in line to what we're committed to and kind of helping the say-do ratio on this one. To your point, we've guided another 150 bps for 2026. I think you hit a lot of the pieces. I'll just add some color, right? At the gross margin level, there's some volume leverage, but the real volume leverage sits at the EBIT level, right? So we're able to grow that top line and certainly manage our overall costs under that same growth. So you get good volume leverage there.

Price, to your point, will always be one of our top profitability increases. Again, low single-digit price, but we all love that because it helps the top line grow and it falls through to the bottom line. So that will continue that play. But at the same time, that price has to more than offset the inflation that we have primarily in our compensation structure, right? Everyone comes in and we might have 3% to 4% higher overall comp. So you got to offset that inflation and you got -- and if there's some overall inflation as well with our suppliers. And so pricing has to be that lever to offset that completely and maybe even deliver some upside.

And then to your point, productivity comes in, right? And so the operating team has continued to build this muscle around day-to-day productivity. We call it our RPS system, but then also really thinking smartly and long term about how do we optimize our footprint, how do we optimize our resources. And so that all falls through. So -- and then we'll continue to just have incredible cost discipline and focus. I can tell you within my organization in finance, we're providing a lot more real-time visibility to spending across all the functions. And we're also built out, I'll say, a mindset and mechanisms to know, all right, to prevent us getting over our skis, meaning if we aren't growing at the high end or whatever the rate, how do we dial things back so that we still deliver the margin expansion we can -- and we have the mechanisms around that.

So I think the last piece of -- maybe the question is the framework over a longer period of time, right? So it's really those same dynamics every year. We expect that we'll see more volume leverage, I'll say, in kind of '28 and beyond, right? So the next -- this year and maybe into next year, there's, again, still strong volume leverage, but maybe we'll get more of that after we finish or I'll say, get more focused on our Fit for Growth investments in '26 and '27. We've talked a lot about it, but we recognize that for us to be able to scale and grow and be double the size business over the next several years that we need to do things in some way differently than we've done up to kind of life to date, if you will. And so that's infrastructure, that's having the right talent and organization, some of the IT systems, and that's where we're focused on investing over the next couple of years.

So maybe on that point of investments, I mean, maybe if I could take a bit of a leap here, a lot of these investments have to be done early on and the benefits are more longer term. So as you look at the current -- the investments in IT product, you talked about the executive team, Asia expansion, R&D. Maybe just walk us through sort of how are you prioritizing these? And how should we think about the investment sort of ramp? Does it increase into the back half of the year? And then the benefits, how should we think about those benefits coming back to you and layering that in 2027, just timing of those?

I mean, so we shared on the call that we would step up in first quarter on our operating expenses from 4Q and then be kind of flat to mild or modest growth through the year. So I mean that is the timing. We're trying to -- you walk in again with some immediate increases due to primarily compensation increases and some other things that have now hit in first quarter, that's what will hit. And then again, we're managing that step through the rest of the year in terms of how we effectively hire more resources and the timing of that.

The -- to your point, those have to yield benefits. I mean I'll say that, again, some things are about preventing things breaking at the scene, right? There's an infrastructure and an execution that is required to deliver at the higher scales. And so to me, the benefits come in our ability to gain volume leverage. But it's not a, oh, I add this $1 and I get $2 a year later. It's -- I add that $1 and it's now created a capacity for me to grow and grow, right? And I think, again, the good news is that the things we're doing now have a lot of legs and like runway in terms of the ability to scale beyond that. It's not, oh, every year, I need to do that again, right? And so that's where these investments come into play.

So I think, again, we'll start to see some of that in '27. But then even beyond that, I think we'll get more of that volume leverage. And so again, still maintaining this target of being kind of -- we said 30% EBITDA, call it, 25% EBIT sort of margin rate by the 2030 time frame. But again, it's not a linear path.

Yes. But despite the flat sequential that you talked about in terms of the modest -- I mean, Q-over-Q through the year in OpEx, these are commitments that you are still -- I mean, again, this is an investment year, so to speak, right? Benefits are still...

Absolutely. Absolutely. But again, an investment year that still delivers at the midpoint of 150 basis points of margin expansion, right? So this isn't one or the other. What we're doing is both at the same time.

Got it. Okay. Another question that we continue to get us with respect to ATF, it's been a very successful product for you, getting now spec-ed into commercial therapies. Maybe just wondering if there's any updates on the competitive front? And maybe just give us sort of how is the funnel looking there, the level of interest?

Look, we are the leader in perfusion technology, right? And we have been for years, a decade or more. We have a ton of experience. And when you look -- peel back the curtains on all the expertise we've got in resources. We have been competing with TFF as an alternative that entire time, right? And nothing that's been kind of recently discussed would suggest, it's not another version of a TFF sort of solution. By the way, we have our own TFF solution. So frankly, we're agnostic if our -- the customers that we're supporting are a TFF house, then we'll provide a solution for them as well. And in fact, we find that in most cases, we win those opportunities as well.

So I think the other good, I'll say, point on this is, in addition to that leadership we have, we continue to invest. So this isn't a, oh, we're going to stand on our laurels in terms of, hey, we've been able to beat competition. We're always going to be investing for that next gen and staying steps ahead. So we feel great about the opportunity base. As you know, we've talked -- it's not just a mAb story. It's a new modality as well, cell therapy wins. So it's such a core important growth factor for us within the organization. So...

Absolutely. Maybe just last one in the last minute that we have here. In capital deployment, you had 908 product and then REBEL that you acquired and then Tantti. I mean, maybe just give us a update any -- on the integration front, but more importantly, how should we think about areas where you -- there is a better strategic fit to the current portfolio because portfolio is something Tony used to talk about. Obviously, Olivier is focused on expansion of the portfolio. How should we think about the M&A?

Yes. So first, just on the integrations, they're going incredibly well. I mean, again, you can see the new products that we're launching on the resin side that embed the Tantti technology. We've talked a lot about how do we integrate the 908 portfolio into some of our upstream applications. And so again, still progressing in that way and a lot of integration activities behind the scenes as well, all going well. We continue to focus on innovative, differentiated technologies.

We might fill some of the workflow gaps that we have, whether it's bioreactor, cell culture media, biofiltration, maybe a third place. And then we're also going to be looking at other ways that we can provide solutions on customers as they look at their new modality pipeline as well. And again, with a priority on accretive top line, accretive bottom line, and you'd love to see EPS kind of be immediately accretive or soon thereafter. And we also now have been playing -- not playing, sorry, we've been exploring and using this opportunity on minority investments as well so that we can stay connected. So we did the Novasign partnership. Now we stay connected with the technology, but without some of the immediate dilution. So...

We're excited. It's -- I think we've got a great year ahead of us and really strong pipeline and activity and look forward to continue the dialogue.

All right. Great. Thanks.

Thanks, everyone.

Ladies and gentlemen, thank you for standing by. My name is Jerico, and I will be your conference operator today. At this time, I would like to welcome everyone to the Repligen fourth quarter 2025 earnings call. [Operator Instructions]

I would now like to turn the conference over to Jacob Johnson, Vice President, Investor Relations. You may begin.

Thank you, operator, and welcome, everyone, to our 2025 fourth quarter report. On this call, we will cover business highlights and financial performance for the 3 and 12-month periods ended December 31, 2025, and will provide financial guidance for the full year 2026. Joining us on the call today are Repligen's President and Chief Executive Officer, Olivier Loeillot; and our Chief Financial Officer, Jason Garland.

As a reminder, the forward-looking statements that we make during this call, including those regarding our business goals and expectations for the financial performance of the company, are subject to risks and uncertainties that may cause actual events or results to differ. Additional information concerning risks related to our business is included in our quarterly reports on Form 10-Q, our annual report on Form 10-K and our current reports, including the Form 8-K that we are filing today, and other filings that we make with the Securities and Exchange Commission. Today's comments reflect management's current views, which could change as a result of new information, future events or otherwise. The company does not oblige or commit itself to update forward-looking statements, except as required by law.

During this call, we are providing non-GAAP financial results and guidance, unless otherwise noted. Reconciliations of GAAP to non-GAAP financial measures are included in the press release that we issued this morning, which is posted to Repligen's website and on sec.gov. Adjusted non-GAAP figures in today's report include the following: non-COVID and organic revenue and/or revenue growth, cost of goods sold, gross profit and gross margin, operating expenses, including R&D and SG&A, income from operations and operating margin, tax rate on pretax income, net income, diluted earnings per share, EBITDA, adjusted EBITDA and adjusted EBITDA margin. These adjusted financial measures should not be viewed as an alternative to GAAP measures, but are intended to best reflect the performance of our ongoing operations.

With that, I'll turn the call over to Olivier.

Thank you, Jacob. Good morning, everyone, and welcome to our 2025 fourth quarter call. We had a great finish to 2025, with $198 million of fourth quarter revenue, which translated to 14% organic growth in the quarter and $738 million of revenue for the full year. As a result, we exceeded the high end of our October guidance for both revenue and adjusted operating income. We were thrilled to return to robust growth in 2025, with 16% growth on both a reported and organic non-COVID basis, and full year organic growth of 14% exceeded the high end of our initial 2025 guidance.

Once again, the diversity of our portfolio was on display in the fourth quarter as proteins and process analytics both grew over 30%, with chromatography not far behind with more than 25% growth. The same was true for the full year as protein grew greater than 30%, while analytics grew 37% on a reported basis or 21% excluding M&A. This highlights our team's strong execution on the growth opportunities that exist across our portfolio.

Filtration grew high single digits for the quarter and the year. Consumables drove the growth in the quarter with over 20% growth. Capital equipment was essentially flat year-over-year due to a tough comparison, but up 10% versus the prior quarter as we saw capital equipment revenue growth sequentially throughout the year. Capital equipment benefited from downstream analytics demand.

Outside of a couple of specific growth drivers, we saw relatively muted demand for equipment. In terms of end markets, biopharma lead the way, and revenue growth was strong across all geographies. While we are no longer providing detailed order commentary, the strong order trend we saw throughout 2025 continued in the fourth quarter. In short, we had a great year with momentum across the portfolio, allowing us to significantly outpace market growth in 2025.

As we turn the page to 2026, we're excited about the product portfolio we have, the team with peers and the strategy we're executing. We recently held our global commercial meeting. And after spending time with the team, it's clear we built a world-class organization, and the team is highly energized. Our initial 2026 guidance called for $810 million to $840 million of revenue or 9% to 13% organic revenue growth. This includes a 2-point headwind from a gene therapy platform.

Jason will provide more details on our 2026 guidance, but I wanted to share a few high-level thoughts. There are a number of signs that macro backdrop is strengthening, including improved biotech funding, M&A activity and more positive pharma sentiment. After a recovery year in 2025, the current environment is more balanced, though it remains early for some of these tailwinds. As a result, we believe our guidance is prudent, with the low-end appropriately balancing some near-term uncertainty around FDA policy and biopharma strategic response to MFN, while the high end assumes we are able to convert certain funnel opportunities in 2026. Our team is focused on executing opportunities that will arise as the year plays out.

At the midpoint, our guidance calls for 150 basis points of operating margin expansion in 2026. As we highlighted earlier this year, we are committed to margin expansion, while balancing the investments required to support future growth. We expect operating leverage in 2026 to the [ growing ] contribution in coming years.

Impacting our performance by end market, fourth quarter biopharma revenue grew over 20% year-over-year, driven by growth from both pharma and emerging biotech. Revenue from emerging biotech customers grew for the third quarter in a row. Activity from this customer base remains below historical levels, so we believe it's too soon to call this a trend.

CDMO fourth quarter revenue grew low single digits year-over-year due to a tough comparison as we were lapping greater than 14% growth in the prior year. Notably, we saw strong growth from our Tier 2 CDMO customers. From a geographic point of view, we saw strength across all regions, led by Europe.

New modality revenues were consistent with our expectations for a muted back half. For the year, new modalities grew low single digits or high single digits when excluding the impact from a gene therapy customer. We saw strength in cell therapy, while mRNA demand was a headwind.

Turning to strategy. In 2025, we delivered on all 5 strategic priorities we outlined at the beginning of the year. First, we accelerated growth with a transformed customer experience. As I mentioned earlier, we delivered 16% growth in 2025. This was driven by momentum across our portfolio, customer base and geographies, and a testament to our commercial strategy.

We continue to capitalize on our growth portfolio with our key accounts team, which is focused on approximately 20 large pharma and CDMO customers, with the objective of further penetrating these accounts by increasing both the number of product lines they purchase and their overall volume. As we highlighted earlier this year, we are now selling 2.5x as many product lines to these customers versus 2019. In addition, our commercial team is incentivized to cross-sell our entire portfolio. We continue to see a long runway for clear account penetration and cross-selling opportunities. In 2025, we made notable progress on our Asia Pacific strategy. We will continue to invest in 2026, given the growth opportunities in this region.

Finally, we would highlight our investment in services, which was accretive to growth in 2025, and our guidance assumes it will be again in 2026. We have a high attachment rate for services in our analytics franchise and are working to replicate this success across the rest of our capital equipment portfolio.

As Jason will discuss in more detail, in 2025, we balance margin expansion with critical investments in the business. We expanded adjusted operating margin by 90 basis points to 13.8%. Excluding M&A and foreign currency, we expanded operating margin by 240 basis points. In 2025, we made important investment, including legal, finance and IT leadership, along with AI and infrastructure investments. These are critical to ensure we have a scalable foundation to support the growth we see in coming years.

Third, we had an active year of new product launches in 2025 across our franchises. In analytics, we launched our SoloVPE PLUS, the next generation of our SoloVPE with increased accuracy and faster readout time. We saw traction with the SoloVPE PLUS in 2025 as we benefited from the first wave of upgrades. We believe this upgrade cycle represents a multiyear opportunity.

In filtration, we launched our new ProConnex MixOne single-use mixer. We began demos in 2025, and expect to deliver our first placements in 2026. In proteins, we developed and launched a variety of new resins, including 3 new catalog resins in December for the new modality market. We also saw traction with custom resins developed for specific key accounts. In 2026, innovation remains a top priority.

Fourth, we executed on our M&A road map. In March, we acquired 908 Devices bioprocessing portfolio, which is now part of our recently rebranded PATsmart portfolio. In 2025, we cross-trained and merged our upstream and downstream analytics team. This has resulted in a growing funnel of opportunities. We also made progress on our integration of Tantti.

Finally, in July, we announced a strategic partnership with Novasign to develop and integrate the machine learning and modeling workflow into repeat gel filtration system. As part of the partnership, we also made an investment in Novasign to help scale and expand their operations. This further our digitization efforts and highlight that minority investment are another good investment avenue within our broader capital allocation strategy.

In 2026, M&A remains our top priority for capital allocation and our acquisition criteria are unchanged. First, we are looking for differentiated technologies that address key customer pain points across the bioprocessing workflow and their pipeline of modalities. And second, it must make financial sense from a return and accretion perspective. We have an active pipeline and a healthy balance sheet. As a result, we aspire to add new capabilities to our portfolio in 2026. We remain focused on integrating 908, leveraging our high-performing analytics team.

Finally, in 2025, we made considerable progress on our efforts to become more fit for growth, and I'm sure we have the right foundation in place as we look to scale the business in coming years. We made critical leadership hires across the organization. In addition, we made significant investment in our business systems to ensure we have the right tools and processes to scale the business. This included initial AI investments across our legal and supply chain functions. Looking ahead, we will continue to deepen our bench and make system investments in IT modernization, financial planning and life cycle product management.

Before I turn the call over to Jason, I'll provide some more detail on our franchise level performance. Starting with filtration. As a reminder, this is our largest and most diverse franchise. Filtration revenue grew high single digits in the quarter, driven by fluid management and ATF consumables. For the year, filtration revenues grew 8% or 11% non-COVID. This was a bit below our expectations due to the timing of fluid management revenue and the muted demand environment for downstream systems. We continue to work to optimize fluid management manufacturing and the margin of this product line. Fluid management was still a strong contributor to growth in 2025, while ATF was also created to filtration growth after a remarkable year in 2024 when a week was up more than 50%. Looking ahead, we see filtration returning to low double-digit growth in 2026, with strength across our broad portfolio, offset by the headwind from a gene therapy platform.

Chromatographic capped off a strong year with greater than 25% growth in the fourth quarter and 25% growth for the full year. OPUS large-scale columns were the main driver of growth for both the quarter and year as we won several new pharma customers. Given this momentum and recent new customer wins, we see double-digit growth in [ column ] revenue in 2026, offset by lower procured resin mix. These results in chromatography revenues growing low double digit in 2026.

Proteins were again the highlight of the quarter, with greater than 30% growth and 31% growth for the year, coming in well ahead of our prior expectation for 15% to 20% growth. The growth in 2025 was broad-based across ligands, growth factors and customer ratings. This was a very strong rebound as we have nearly recovered all of the 2024 revenue decline from the demand of 2 of our OEM businesses having reached de minimis levels. This is a testimony to the strategy we are implementing, leveraging both partnerships and for our acquisitions to create innovative solution for customers.

During the quarter, we launched 3 new AVIPure resins for the new modality market. With our [indiscernible] technology and Avitide expertise, we can quickly develop new products, helping address customer-specific pain points. In 2026, we see protein strength continuing with low double-digit growth as we expect to see the benefit from the seed we've planted in recent years.

Analytics closed a record year with 30% plus growth in the fourth quarter and 37% growth for the full year or 21%, excluding the impact from the 908 bioprocessing acquisition. We had traction with our SoloVPE PLUS in 2025, and we believe this upgrade cycle will continue to play out over the next several years. Looking ahead, we see analytics growing greater than 20% in 2026 as we continue to see a robust growth from our downstream analytics portfolio, including SoloVPE PLUS and growing contribution from our recently acquired upstream analytics portfolio. That concludes my commentary on our franchises.

As we transition to 2026, our strategic priorities remain. Number one, outpacing bioprocessing industry growth; number two, driving operating leverage on top of gross margin expansion; number three, continuing to innovate and launching new products; number four, integrating recent acquisitions and pursuing additional M&A; and finally, number five, becoming more fit for growth, with a focus on IT modernization and strategic transformation initiatives.

In closing, our fourth quarter capped off a great year where we delivered above market growth and expanded margins while investing in our business and executed on all strategic priorities. In 2026 and beyond, our goal is to do the same.

Now I'll turn the call over to Jason for the financial highlights.

Thank you, Olivier, and good morning, everyone. Today, we are reporting our financial results for the fourth quarter and full year 2025 and providing initial guidance for the full year 2026. Unless otherwise noted, all financial measures discussed reflect adjusted non-GAAP measures.

As shared in the press release this morning, we exceeded guidance and delivered fourth quarter revenues of $198 million, a reported year-over-year increase of 18%. This is 14% organic growth, excluding the impact of acquisitions and foreign exchange. Acquisitions contributed approximately 1 point of the reported growth and foreign exchange contributed 2 points. For the full year, revenue grew 16% on both the reported and organic non-COVID basis and 14% organic.

As Olivier offered details on our product franchise performance, I'll provide more color on our regional performance. Starting with quarterly revenue. North America represented approximately 47% of our total; EMEA represented 34%; and Asia Pacific and the rest of the world represented approximately 19%. North America grew mid-teens, driven by proteins, ATF and fluid management. EMEA grew more than 20%, driven by proteins, chromatography and analytics. Asia Pacific grew high teens, driven by chromatography and analytics. China grew for the second straight quarter, albeit off a low base. After declining in 2025, we are optimistic China will return to growth in 2026, supported by strong orders in the fourth quarter. For the year, North America and Europe both grew approximately 16% and Asia Pacific grew 19%.

Transitioning to profit and margins. Fourth quarter adjusted gross profit was $104 million, and adjusted gross margin was 52.4%. This was margin expansion of 170 basis points versus last year. The year-over-year increase was driven primarily by volume leverage and price, both offsetting inflation and slight headwinds from mix and tariffs. For the full year, gross margin was 52.6%, with approximately 220 basis points of year-over-year increase. The year had similar drivers as the quarter's margin expansion, with volume and price overcoming inflation and some tariff and mix headwinds.

Continuing through the P&L, our adjusted income from operations was $30 million in the fourth quarter, up 19% year-over-year on a reported basis and up about 25%, excluding the impact from foreign currency and M&A. Further, OpEx was sequentially flat to the third quarter. This translated to an adjusted operating margin of 15% in the fourth quarter, which was an increase of 10 basis points year-over-year on a reported basis, but 140 basis points of margin expansion, excluding M&A and the impact of foreign currency.

For the full year, our adjusted operating income from operations was $102 million, a strong 24% year-over-year reported increase, or up 35% excluding the impact of M&A and foreign exchange. The growth was driven by a $68 million increase in gross profit, reduced by $49 million of increased OpEx. $19 million of this increase was related to M&A expenses and foreign exchange. Excluding these items, OpEx grew roughly 13% year-over-year, with investments in our Fit for Growth journey. I'll also note that about 5 percentage points of the increase came from our annual merit and compensation inflation.

2025 adjusted operating margins were 13.8%, about 30 basis points better than our prior guidance, and 90 basis points higher than last year, driven primarily by volume leverage and price, mostly offset by the dilution of our recent M&A investments. Excluding the impact from M&A and foreign exchange, we are very pleased with our operating margins expanding 240 basis points year-over-year. Our full year adjusted EBITDA margin was 19%, a year-over-year increase of 50 basis points on a reported basis, but up approximately 230 basis points, excluding the impact of M&A and foreign exchange.

Continuing through the P&L, adjusted net income was $28 million, a $3 million year-over-year increase. Higher adjusted operating income was offset by $2 million of lower interest income on declining interest rates. Our fourth quarter adjusted effective tax rate was 20%, which was slightly better than our prior expectations due to tax planning actions in the quarter.

Adjusted fully diluted earnings per share for the fourth quarter was $0.49 compared to $0.44 in the same period in 2024. And for the full year, we delivered $1.71 of adjusted fully diluted earnings per share, up 9% over last year and $0.03 better than the high end of our October guidance.

Finally, our cash and marketable securities position at the end of the fourth quarter was $768 million, up $90 million sequentially from the third quarter. This was driven by $26 million of cash flow from operations, offset by $8 million of CapEx. For the full year, we generated $170 million of cash flow from operations. We remain focused on optimizing our working capital to drive improved cash flow conversion.

To echo Olivier, we are very pleased with our execution in 2025 and the momentum we are seeing across the business, which allowed us to outperform the high end of our original organic growth expectations and to drive year-over-year margin expansion. Looking ahead to 2026, we will remain focused on executing on all strategic priorities, driving above-market revenue growth and balancing margin expansion with investments in the business.

I'll now speak to adjusted financial guidance. This includes our current view on foreign currency outlook, for which we are assuming euro to dollar foreign exchange in 2026 to be very similar to the latter half of 2025. As you may expect, we are continuing to evaluate the implications of the recent Supreme Court ruling on tariffs. That said, included in our guidance is the expectation that tariff surcharges and related costs will have a slightly higher impact on revenue and margin than we saw in 2025 as we incur a full year effect.

We are guiding $810 million to $840 million of revenue or 10% to 14% reported growth and 9% to 13% on an organic basis. The difference of these growth rates is driven by just under 1 point of revenue growth from foreign exchange and de minimis impact from M&A.

Regarding revenue growth by franchise, our overall reported growth guidance of 10% to 14% assumes the following: filtration growth in the low double digits. And as a reminder, certain gene therapy platform creates a 3-point headwind for this franchise; both chromatography and proteins growth in the low double digits. And finally, analytics growth greater than 20%.

We expect adjusted gross margins to expand to 53.6% to 54.1% for the full year, and up approximately 125 basis points year-over-year at the midpoint. This will be driven by volume leverage, pricing and productivity, and we expect a relatively neutral mix impact in 2026. Our guidance assumes several million dollars of tariff surcharges, which represents approximately 50 basis points of headwind, which as I mentioned, we will continue to evaluate.

We expect adjusted income from operations to be between $122 million to $130 million. This implies another year of 20%-plus growth and delivers margin expansion of 150 basis points at the midpoint. As we have highlighted, we will continue to prioritize investments to support our Fit for Growth journey. These include IT modernization and capabilities, product life cycle management, further commercial investments, including Asia, and continued build-out of our leadership bench. Still, we expect operating leverage to accompany our gross margin expansion.

Continuing through the P&L, we are assuming $18 million of adjusted other income, slightly lower than 2025 due to lower interest rates, and a 22% to 23% adjusted effective tax rate. The increase over 2025 is driven by jurisdictional mix assumptions and the benefits we achieved in 2025 that will not repeat. That said, we will continue to execute our tax planning strategy and look for opportunities for improvement.

Putting this all together, we expect adjusted fully diluted earnings per share to be between $1.93 and $2.01. This is up $0.22 to $0.30 versus 2025 or up 15% at the midpoint. To help you with your modeling, we expect normal seasonality, with roughly 48% of revenue in the first half. This implies organic growth is slightly above the midpoint in the second half of the year and slightly below the midpoint in the first half due to more pronounced gene therapy headwind in that period. We expect Q1 revenue to only decline low single digits sequentially from the fourth quarter. This positions us well to deliver on our 2026 guidance.

We expect modest sequential gross margin expansion in the first quarter. And as a reminder, the first quarter of 2025 represented our highest gross margin quarter last year. We expect gross margin expansion for the remainder of the year. We expect OpEx to step up sequentially in the first quarter due to annual compensation increases and Fit for Growth investments. We assume OpEx is flat to modestly higher sequentially through the year.

Our balance sheet remains strong as we ended the fourth quarter with $768 million of cash and marketable securities, as mentioned earlier. We will remain prudent in our spending while maintaining flexible dry powder for potential acquisitions. We expect CapEx spend to be approximately 3% to 4% of our 2026 revenue.

As we wrap, Olivier and I would like to thank our Repligen teammates for helping us deliver above-market growth in 2025. We continue to be excited about the opportunities in front of us, and we are focused on executing our strategic objectives yet again in 2026, most notably delivering above-market revenue growth and expanding margins.

With that, I'll turn the call back to the operator to open the line for questions.

[Operator Instructions] Our first question comes from Matt Larew from William Blair.

Jason, on the guide, you walked through some of the cadence dynamics in terms of the gene therapy headwind. But just in terms of framing the higher and lower end, I think Olivier had called out the policy environment in terms of maybe a low-end swing factor. So I'd be curious what you're hearing from customers in terms of confidence there, but maybe especially in light of recent tariff updates.

And then the higher end of guidance, I think you called out some larger funnel opportunities. I would just be curious if those are similar to some of the larger land grab opportunities you've had in the past couple of years and sort of what the visibility of the timing for those might be. So just helping us think about the higher -- low end given the midpoint centers on that 11%, 12% that you had already framed.

Yes. Matt, I'll start, and Olivier will certainly jump in as well. I mean, for some of those pieces, right, you brought up tariffs. Look, for us right now, tariffs is still a big open question. I think the good news for us is that when you look at where the administration is talking about alternatives to the current regime, that it's going to be pretty much a push for us, maybe even slightly better. But again, for big context, keep in mind, tariff surcharge is far less than 1% of our total sales. So we don't feel like that creates a lot of noise. I think some of the other opportunities, again, for us on the onshoring, those tend to still be pushed out until 2027. And so we don't really see them as a big driver for this year.

But I'll let Olivier talk to some more of the customer feedback.

Yes. No, absolutely, Matt. I mean we have a very strong funnel of opportunities. As you know, we are tracking that very specifically, particularly in the funnel with high probability, above 50%. This is at the highest level ever and significantly higher than a year ago. So we are very excited about it. Indeed, it's all about how do we manage to translate that high probability funnel into orders and sales this year. But overall, we are in very good shape here.

Our next question comes from Dan Arias from Stifel.

Jason, Olivier mentioned the commitment to op margin expansion this year. I'm curious just how as a priority that ranks relative to M&A? You were 100 to 200 basis points above the range, excluding M&A. In 2025, you were below it, including M&A. It sounds like you're interested in what might be out there deal wise. So I know it's never black and white. I do appreciate that. But if I were to just sort of ask it plainly, is delivering on 150 basis points of op margin expansion something that you intend to hit barring the unforeseen because you want to march back towards 20%? Or is it more like we intend to hit it unless we've had something that has us not hitting it because that's what's good for the business?

Look, I think to your point, it's never black and white, right? Every deal is going to have a strategic merits as well as the implications, both short term, right, and medium and long term on the financials. I mean, we acknowledge, right, the headwind that we've seen this year or rather '25 last year, but still stand by the firm strategic benefit and the integration that we're having with both the 908 assets as well as Tantti.

As we look in to go forward, we'll still look at other ways of capturing technology partnerships like the Novasign, right, minority interest is out again. It eliminates that impact on margin. And then as we look for other deals, again, we will certainly be prioritizing those that have more immediate accretion to the financials, but again, I can't say that for our long-term strategic benefit that they might not still be worth a short-term dilution. So we're going to keep a well balanced look in that.

I'll end now that, that aside, margin expansion remains a top priority for us, along with our above-market growth strategic imperative. And so those will be first in line. And you can see, I think we expanded margin. I think, again, you made the point, excluding M&A, 240 basis points year-over-year in '25 and teed up another good step up of 150 basis points at midpoint. So we're delivering what we've set out to do.

Our next question comes from Doug Schenkel from Wolfe Research.

A follow-up to an earlier question on pacing. So the Sarepta headwind, as you know, annualizes mid-year. ATF consumables sensibly pick up steam as the year progresses. And there was a lot in the Q4 updated in your prepared remarks that demonstrates coming out of what has been a stronger than market period that momentum continues to build. With all that in mind, in spite of that, your comments on pacing suggests that you're assuming a normal first half versus second half revenue split. Why is that? Is this just prudence given continued market uncertainty? And by extension, are you assuming the market is not completely normalized this year? So meaning market normalization would actually be a source of upside to the guidance range?

Doug, Olivier here. Yes, I think here in the last part, you summarized the situation very well. I mean that's why we have issued the guidance. We have issued from 9% to 13% organic in 2026. There are stuff we control, there are stuff we don't control fully. And the stuff we control, the funnel, I mean, we've got, as I just mentioned earlier, the highest funnel we've ever had. We've got great opportunities across our entire portfolio of products.

Look at what happened in 2025, I mean the 3 franchises that grew by far the highest other one outside of filtration, which is a testimony we really have a fantastic broad portfolio of products. So this is we control what we control less indeed is what can happen from a macro point of view. And if I start maybe with MFN, I mean, I think it's fair to assume, some of these big pharma companies are digesting all of the deals that happened in quarter 4. And this might mean a little bit of delay on some specific CapEx spending decision that everybody is hoping to see coming earlier than later in the year.

And then the second piece I would pick up as well is the approval. I mean, last year was okay. I mean there were 25 monocular antibody/biosimilar approved similar to 2024. There were only 5 new modality approvals versus 7 in 2024. So far this year, after almost 2 months, there have been very little FDA approval for biologics. So these are stuff we are well watching and depending how they play out one side or the other, this is where the guidance could move one direction or the other indeed.

The only thing I'd add, Doug, is just the guide or the, I'll say, the direction that we shared in 1Q, but we still start off the year strong, with it being down only as we said a couple of single-digit points sequentially from fourth quarter. So again, we still believe that we're starting off 1Q on the right foot.

Our next question comes from Casey Woodring from JPMorgan.

Great. I have a couple of quick clarifications. So can you just clarify what 1Q organic growth is netting out to? I think I'm getting to somewhere around 10%. And then also, can you walk through the guidance range for the year? You guided to low double-digit growth in chromatography, proteins and filtration. But the low end of the guide calls for 9%. So maybe just walk us through how to reconcile those numbers?

And then just as a quick follow-up, kind of curious what is embedded for ATF within the low double-digit filtration guide? You called out ATF consumables was strong in 4Q and the blockbuster has been in focus here. So just curious what's assumed there.

Okay, Casey. So a few questions. So I'll start answering probably your first and your last question, and then I'll hand over to Jason for the middle one.

So in terms of Q1, and Jason just mentioned it, we were really in good shape to deliver a very strong Q1. In fact, we expect Q1 to be sequentially only down by a couple of [indiscernible] versus quarter 4 of 2025, which is a really great performance. I mean we've always talked about seasonality, and typically quarter 1 is supposedly one of the weakest quarter in the year. We won't see a lot of it. So we're really in great shape to start the year.

And then before again, I hand over to Jason on the middle question, in terms of ATF, I mean, you know like we had incredible growth in 2024. I mean ATF grew more than 50%. Last year, ATF was still accretive to filtration growth, which is absolutely great performance. We are very excited about that business. As you know, we are getting designing in multiple late-phase commercial drug lately, and we still have very big hopes about the runway we have on that specific product line for the next several years here.

Jason, do you want to add anything?

Yes. Just a quick clarification. So Casey, as we ran through the year as I did in the prepared remarks to go through the franchises, I was discussing reported results, so not organic, not FX adjusted. Of course, the 9% to 13% is the organic view on the reported basis, it's 10% to 14%. So that's just a quick answer. We don't have a great way to roll through all those pieces into the franchise. And so that's the difference.

Our next question comes from Puneet Souda from Leerink Partners.

This is [ Philip ] on for Puneet. This is similar to several questions from earlier, but -- just you previously directionally hinted at 11% to 12% growth for 2026. And I just want to make sure if there's anything you're seeing since then that may have changed that softening your view? You referenced MFN and large pharma may delay CapEx decisions after digesting deals made in 4Q. So is there anything there or alternatively, the delta there with the 9% to 13% mostly prudent and you're more confident? And maybe if you could just walk us through any of the other puts and takes in organic growth for this year? Just like any levers on what may get you to the higher end versus the lower end?

[ Philip ], I just start by saying we had a really great year 2025. I mean we delivered above our initial organic growth guidance. So at this point, I mean, call it, mid of February, we think the 9% to 13% guidance is appropriate starting point for 2026. And we mentioned a couple of times already, Q1 will really position us very well to deliver on that guidance.

And then I just would like to say, this is also very well aligned with the framework we shared with all of you previously. We always said we want to outpace market by at least 5%, but we do have this 200 basis points of headwind in 2026. But we think we were really well aligned with that framework we talked about earlier. We have a number of opportunities across our customer base, our product portfolio, and that is not all contemplated into this guidance for sure. But as I mentioned earlier, there are stuff we control, how do we translate that opportunity funnel into orders. There are stuff we control less, which is a macro environment. And yes, we just want to see how people are going to move forward with this MFN agreement and when are they going to put the trigger on spending CapEx because we all see still slow CapEx spending at this stage, but also getting potentially more IT approval as well to accelerate growth. So that is really the framework we are working on right now.

Our next question comes from Justin Bowers from DB.

I really appreciate you breaking out the organic versus inorganic margin performance for 2025. And just wanted to also clarify and understand some of the moving parts. It sounds like the 50 basis point headwind you called out, that's related to margins, that's sort of the clarification. And then two would be, what are some of the other moving parts that we should consider as it relates to the organic margin expansion?

Yes. I think you're referencing the -- sorry, sorry.

No, go ahead. I was just saying in 2026.

Yes, of course. Yes. So I think you're referencing the 50 basis points of tailwind we called out for tariffs. So again, that's just the impact of a small amount of surcharges and then really passing those through as cost or say, 0 margin. In addition to that, again, when you look at the year, again, we've talked about good gross margin expansion, driving volume leverage, price, productivity, of course, absorbing inflation and other pressures that we have, mix is pretty nominal from an impact for the year. And then it's all about our OpEx management. And again, we've incorporated a continued investment in our Fit for Growth journey.

And when you look at sort of the guide, we've talked about a step-up in OpEx in the first quarter, which really comes down to walking in at the beginning of the year and having some annual compensation increases as well as some investments that we had prioritize to push into the beginning of the year. And then that OpEx basically stays flattish to slightly increasing through the course of the quarters. And therefore, we're able to get more operating leverage. So again, we delivered 240 basis points of organic margin expansion in 2025 and believe we've got a good objective here for 2026 to again expand margin.

Our next question comes from Dan Leonard from UBS.

I'd like to talk about the analytics portfolio a little bit. I'm surprised by the 20% growth forecast for 2026 on a 37% comp. I understand that SoloVPE is a multiyear product cycle, but when do tough comps become a challenge? And how far along are you through that upgrade cycle?

Dan, really good question. You're right, like delivering above 20% growth on a business that has been growing so much in '25, it sounds like, wow, that's really impressive. I mean, we are very confident about it for multiple reasons. And you mentioned one of them, which is the SoloVPE PLUS upgrade where we are just at the beginning of the upgrade cycle. I mean we literally upgraded less than 100 units in the last 2 quarters of 2025. We've got 1,500 to 2,000 units installed base right now where we see potential to get upgraded. So it's going to be probably a 2 to 3 years upgrade cycle in front of us and until we launch new version of Solo. So that is one of the big tailwind.

Beyond that, as you know, we acquired 908 last year and beginning of March of 2025 and we merged the 2 sales organization. And I have to say, I mean, the funnel improvement we've seen over the last 2 to 3 quarters has been absolutely phenomenal. And now for our sales team to have -- instead of having only one product to sell, to have 5 and very soon 6 products because we're developing another one we intend to launch toward the end of this year as well, is also a great motivation factor, and we're getting a bigger seat at the table with this much broader portfolio of product we had.

And then finally, I would just mention also the FlowVPX part of the offering, where, as you know, we had a lot of attraction both at line, but in line as well [ where ] about 25% of every system we've been selling for the last 1 year now that includes a FlowVPX technology. So we've got really multiple angles. That's why we are so positive about it and considered about the potential growth in 2026 here.

Our next question comes from Matt Hewitt from Craig-Hallum.

Congratulations to the strong finish of the year. You talked about it a little bit, obviously, new products have been a key driver for Repligen. And as you look at fiscal '26, do you have a pretty robust pipeline? Is that across the portfolio? Or are there specific segments in particular where you look at opportunities to launch the new products, gain share, maybe expand the markets a little bit?

Matt, great question. I mean, as you know, innovation is really in our DNA. And if there is the first word, I always mention about Repligen [ 3 ] innovation. So yes, you're right. I mean, we've been successful in the past. We've been successful in 2025. We will be successful in 2026 and beyond by the launch of innovative products. And we are working on several of them right now.

I mean I start for once with protein because as you've seen, we had incredible traction on protein in 2025, and this is just the beginning of the journey. I mean we have now launched 4 catalog resins. We are intending to launch at least 3 or 4 extra catalog resin this year in 2026, meaning we're going to start to have a really sizable catalog of operating for our customers. We're mostly focusing on new modalities right now, but we are starting to look at other opportunities as well in more established a drug that might have been on the market for a long period of time because we see a lot of opportunities on that side as well.

Well, one thing I would add on protein as well. We are working on multiple custom projects for specific big pharma customers as well, which we don't talk about, because these one are exclusive, but this is another reason why this franchise has been doing so well in the last 12 months.

Beyond that, obviously, we've got multiple opportunities of innovation on the rest as well. On filtration, I would probably just mention one, main one, which is, as you know, the potential combination of ATF with the Raman technology, the MAVERICK technology we acquired via 908, where the point where we've seen that technique, this is working very well. Now it's in the hands of our product management team that will decide how and when to potentially launch that combination. We think that could be a big differentiator to add even more hurdle for potential competitors to ATF, but also to accelerate the growth of our PAT portfolio, the 908 portfolio.

And then really, probably the last piece I would mention as well is we are looking at broadening that PAT portfolio significantly and beyond 908, beyond the FlowVPX, we have acquired the right from a company called Daylight for mid-IR technology several years ago. And thanks to the great technology team we have from 908, we are now at a point where we are already working on a beta version of this mid-IR technology that could be a total game changer in the industry for both the [indiscernible] USDF, but also for measuring protein aggregation as a concept. Customers who are testing it, love it, and this launch, we expect to have toward the end of this year, beginning of 2027, will be another big game changer for the industry. So very excited across the board, plenty of stuff coming our way in 2026 here.

Our next question comes from Brandon Couillard from Wells Fargo.

Olivier, I understand China is a pretty small region, but you've been more constructive on orders the last 2 quarters there. Any update on the incremental investment that's still needed to get the commercial organization where you'd like it to be? And if you could put some bars around the expected growth rate you see coming out of China in '26 and how that might compare to the broader bioprocess market in that region?

Yes. Thanks for the question, Brandon. I mean, you're right. I mean, China has become pretty small for us. I mean, last year, it was about 2% to 3% of our total revenue. We used -- it used to be about high single digits of our total business during COVID. So we were aiming to definitely grow that region faster than the rest. And the first signs are pretty positive. I mean, you're right. I mean, we now have 2 quarters in a row of top line growth in China. In fact, order in quarter 4 were really very strong. So we are very excited about that. And we are hopefully seeing China really going back to significant growth from this year onwards.

I don't have a specific number to give you. I think I mentioned several times. I know that reason very well, which is why we are very focused on adding the right amount of people. We opened a new office in quarter 3. We are ambitious down there. We are working on several partnerships with local companies across our entire portfolio, and we're definitely aiming to overpace our entire total growth in China and then really making sure this is region become much bigger for us over the next 3 years than it is today.

Our next question comes from Matt Stanton from Jefferies.

Olivier, maybe one for you. I think in the prepared remarks, you talked a bit about service. It was accretive to growth in '25, sound pretty good about it here again in '26, obviously strong on the analytics side, but maybe just talk about the service opportunity more broadly? Is that on new products? Can you go back to the installed base you have out there? And then maybe talk about -- is there any tweaks you've made to comp or how the commercial organization is incentivized to go out and capture that runway on the service side in front of you?

Matt, really an interesting good question as well. I mean services represented approximately 6% of our total sales in 2025. If you just benchmark us versus the industry, we are about 4, 5 points below where others are. And so we know we have a really great opportunity to grow on that side.

And I'll give you just a very, very interesting checkpoint here. I mean our attachment rate for the analytical part of our portfolio is pretty high. I mean, it's above 50%. You would say it's almost at benchmark. Our attachment rate for the larger-scale equipment, those RS downstream system, even our ATF system, that system is only significantly lower. So that's the area where we have specific area of focus right now.

And you're absolutely right. It all starts with commercial team where you need to make sure those commercial team are being incentivized to get more service contracts signed at the earlier point of contact. But we are also, at the same time, starting to look at our service business as a more independent P&L and we're adding commercial resources that are specifically reporting to our service leader to make sure we can grow that business faster than it has in the past. So multiple stuff we are looking at. Our real ambition in a few years from now is that services would indeed be at benchmark, meaning about 10% of our total sales.

Our next question comes from Brendan Smith from TD Cowen.

I actually wanted to ask just a follow-up on your commentary, Olivier, on the MAVERICK integration with ATF and just see if you guys see an opportunity to launch that this year? Kind of just curious how we should think about that in the context of -- out of '26 guidance? And maybe also, if you expect that to kind of replace the legacy product altogether or if you plan to kind of offer it with and without the MAVERICK added moving forward?

Brendan, yes, I'm not sure yet. To be very open with you, Brendan, we are looking at different options here. Again, it's in the hand of our product management team to assess when and how the launch would -- could potentially make sense. I think in any case, that would be an option. I mean we are not going to force people to buy Raman technology on top of our ATF system and so on. That would be an option for our customers. Depending again on the traction we get and so on, we might make it more and more of, I would call it a force option, but maybe more, hey, you should really go for it versus hey, are you aware about the fact that there is an option to track what's happening in your bioreactor via the ATF loop. I'll tell you more about that for sure in the next couple of quarters once we've made a further decision on how and when we would potentially launch that combined technology here.

Our next question comes from Subbu Nambi from Guggenheim.

In your prepared remarks, you spoke about the muted downstream demand in the second half. What drove that? And how is that shaping your 2026 guidance? And also, what are you assuming for capital equipment in 2026?

I didn't get the first part of your question. What was about downstream? I didn't get it, Subbu, sorry.

Were you asking about the demand for downstream systems?

Exactly, yes, the muted demand for downstream systems.

Yes. No, absolutely, Subbu. So I mean, I think our direct competitors have mentioned several times that CapEx spending was pretty muted in 2025. We had an interesting year, as you know, where Q1 was really very weak on very high comp, then Q2, Q3 were very strong. In Q4, even though sales were incrementally higher by 10% versus Q3, I mean, versus Q4 2024, the overall demand was kind of muted because we had pretty high compound.

So if you look at the overall year, I mean, CapEx sales for us were more or less flat between 2025 and 2024. I think it's fair to say the market was down significantly. I mean, we've heard people saying maybe as much as high teens down between '24 and '25. We were flat, which is better than others. But yes, it's absolutely fair to say there is one area where we would like to see some real improvement and where we would like to start to see customers pulling the trigger and spending more money is definitely on CapEx equipment. So that's what we're expecting, hopefully, to see very soon and partly via some of these onshoring projects, hopefully accelerating towards midyear with hopefully some grant coming towards the end of this year here.

Perfect. And just to confirm, you're not assuming any massive growth in capital equipment? I know the answer, but just confirming.

Just to repeat, Subbu is asking what is our expectation for capital equipment in 2026.

So for 2026, we are still aiming for low double-digit growth, Subbu. So obviously, we're getting a lot of traction from our analytics business, as you know, which is then fair to assume this is going to drive the majority of that low double-digit growth we expect in 2026. For the rest, which is more the downstream system, we were expecting probably somewhat flat sales in 2026. This could be a really nice upside, again, if we start to see a better macro on that side here.

That concludes the question-and-answer session. I would now like to turn the call back over to Olivier Loeillot, CEO, for closing remarks.

Yes. Well, first of all, many thanks for joining our call today. I mean you heard us, we were really thrilled with our 2025 execution, and this has allowed us to deliver a fantastic 2025 resource. In 2026, we remain focused on executing on our strategy. And as usual, serving above-market growth. So thanks for your time, and talk to you very soon.

All right. Great. Thank you, everybody, for joining us today. My name is Casey Woodring from the Life Science Tools and Diagnostics team here at JPMorgan. Pleased to be joined by the management team of Repligen. We'll do the corporate presentation first and then leave time for Q&A. So with that, Olivier, over to you.

Thank you so much, Casey. Thanks for coming, and looking forward to telling you a bit more about Repligen. The usual safe harbor statement. So for those of you who are not completely familiar with the company, we are headquartered in Walsam, Massachusetts. We are really a pure bioprocessing play, about 2,000 employees in total. And for the vast majority of our portfolio, we've got dual manufacturing in U.S. and in Europe. And finally, at the midpoint of our guidance in 2025, we were at [ USD 733 million ] in sales.

What's our vision? We want to be the global innovation, and you will hear me mentioning innovation several times today, leader in bioprocessing with a very extensive portfolio of very differentiated data-driven solutions across most therapeutical modalities. So there are a couple of takeaways, and I'm going to start with that so that you remember them right at the beginning. The first one, again, is innovation. So we've been really playing on that side for the last 10 years, and we are playing in a pretty large bioprocessing market, as you know, and we play against very big competitors. So for us, really, the way to win is via launching those very breakthrough innovation and really supporting customers in their path towards more yield, better cost structure and so on. So really innovation at the core of everything. We have a very diversified portfolio of products. I mean I'm sure many of you start to understand it. I mean, last year was really a showcase where we've had really performance across the entire portfolio. And we want to say we have got one of the broadest portfolio really in the industry today.

And the good news is we've got multiple levers to keep on outpacing industry growth. I'll talk about that quite extensively later on. I have to mention a few here. Obviously, those breakthrough solutions we have. But beyond that, also, we are still very much clinical versus commercial. And we also have a very, very, very, very solid sales strategy on the key account side that has really enabled us to open also at multiple big accounts, and we're just really at the beginning of the journey. And finally, definitely some great successful with new modalities, and we'll talk about that quite a bit.

We want to expand margin. I mean we are absolutely focused and Jason and I with the company for about 2 years. It's really at the core of our hold every day, and we've done a pretty good job last year, but we're on a path to do even better over the next 5 years and reach 30% EBITDA margin in the next 5 years. And finally, we are very heavy on delivering on what we say we're going to be doing. We have 5 strategic properties in '25. We've delivered on each of them. And we decided to kind of keep almost the same for 2026. because we think we are in a pretty long-term type of growth journey here, and there is no reason to change those priorities, but we've done multiple progress over the last 12 months here.

So what is giving us right to win again is innovation? So when you look at our portfolio, we've got the 4 main franchises, filtration, rhamatography, analytics and proteins. In each of these different product lines, we've got really very innovative products and innovative meaning like we estimated almost 80% of our portfolio today, we don't really have competition. And this innovation was always focused on enabling better yield, productivity gain for our customers and also enabling our customers to go faster to market.

We've got the advantage of the size. We're not that big, but pretty flexible. So we are very nimble, very customer centric. I mean, that's really part of our DNA in the company and we are really obsessed to meet our customer needs.

Growth portfolio. I'm going to show you in a minute what it's all about. I just want to say a few words to start with on digitization. We know it's at the center of the preoccupation of our customers right now. We seem to have a really good chance with our PAT technologies, but we've got a path forward to really capitalize on that and we lead the pack in terms of the digitization journey of our customers.

So we're a fast-growing company. I mean we took 2019 because that was before COVID and then '25, which was last year because as we all know, there was a lot of noise during COVID. So we thought it was quite impressive to see that when you exclude the cabin noise in between, we had a CAGR of about 18% during the last 6 years. And then when you look at the total addressable market, this is even more stunning in a way that our total addressable market was only USD 3 billion 6 years ago, and now we're up to certain -- so if you make the calculation, midpoint, $733 million, we are about only 2% of the market.

So do we have runway? Yes, we do. We have a lot, a lot of runway and we are very happy to have that huge total addressable market opportunities because with the breadth of the portfolio we have, we know we've got incredible future in front of us.

So what is this broad diversified offering. I think this slide is probably the one I like the most. It shows you really how we've been evolving over the last 10 years.

Look on the left side customer-wise, 10 years ago, our top 3 customers were 2/3 of our business. Last year, our top 10 customers was 1/3 of our business. So when you talk about diversification, I mean it's a fact like we've done an amazing job to really reach out to many more customers and probably big pharmas and big CDMOs as well.

But from a franchise point of view as well, it's quite stunning to see like 10 years ago, we were almost 3/4 of our business in protein, a little bit in filtration and come. There's a shift toward more filtration with multiple acquisitions and strengthen chromatography business and now a bigger play into analytics has enabled us to also have a much more diversified portfolio of product today.

And then finally, looking at modalities. We went from being heavy, heavy, heavy on monoclonal antibody, was still heavy, heavy, but a bit less. We are doing about 16% of our sales in new modalities and we'll talk a little bit about that, of course, later on as well. So really a very diversified portfolio of products.

And that's on a picture. What's better than a picture. When you think about a full workflow that is being utilized by our customers, we pretty much have the main buckets. If I want to really simplify, we've got 3 main gaps, borates cell culture media and viral filters. But in every other bucket, we do have a play today, a smaller or bigger one, but we are really happy that we are absolutely can support customers, partly they have specific needs of custom solution in the different buckets today.

What about the multiple levers to outpace industry growth? So we like to create solutions. So innovation, again, I mean and innovation technology really creates new markets. And that's why we like the way we operate in that environment is we're not just coming to compete with big guys who are doing amazing things are here to just come and try to create new solutions create new market segments that are going to be add up to what exists already on the market.

Digitization, I talked a little bit about already, it's a perfect example where we are coming now with brand-new PAT solutions to enable our customers to be faster and more efficient. And we have a real track record in M&A. What I think Tony and the team have done so well in the past by all of this acquisition was really to add technologies that were somewhat next to some of the other technology we had and that we could not only embed within our own portfolio, but make -- create products that were even better or that were even newer than what this company we are bringing us. And the best example we had is the acquisition of Meta Nova 2 years ago, which was stainless steel mixing technology based on magnetic steering. And now we launch our own single-use mixers, which we think have the best technology in the industry right now. So we like to create solutions.

Increasing our positions, of course, I mean, we are playing into that big market. So we're trying to make sure we're opening more doors. And that's where really commercial excellence is of essence. And we've got an incredible commercial organization that has enabled us to really penetrate big pharmas and CDMOs really very largely over the last several years. Here again, we are really at the beginning of the journey. You'll see in one of the next slides that we are sitting about 2.5x more products for each of these accounts than we were 5 years ago. But in many cases, we are just starting to sell those products.

Meaning like the runway we have for the next 10 years is going to be really very, very big with all of these customers. We have a sales team that is really not capable to cross-sell this portfolio of products. And if I look from a geographical point of view, we're going to have a focus on Asia because we are a little bit subpar today in Asia. And finally, leveraging the mix. I mean, we're still very much clinical, even though slowly, but surely, we are moving towards more commercial products. I mean, the split has changed a little bit last year. But obviously, the more clinical you're supporting the more tailwind you get because every time a product makes it to the market, you're getting obviously a significant increase of volume demand from your customers.

And finally, we've got a portfolio that's really well suited for new modalities. So we all know there has been some headwind in 2025 which is one of the reasons why we're particularly happy about the performance we had because even with those headwinds, and I would never have beat in 2025, new modality would be potentially diluting our growth. But this did happen. We are still extremely positive about it and know that this is going to come back. probably going to take another year or so, but we are absolutely convinced that's going to be accretive to growth from 2027 onwards.

So that's about some of the levers we have to our I just quickly go through that slide. We estimate about 80% of our portfolio is really very differentiated just to talk about product line like ATF, product line like OPUS, all of these PAT technologies, but really what's very important is we are extremely focused on our customer needs. There is need for new products that are much more tailored for these newer products that are being launched on the market and where we probably all of us had the luxury back 5, 10 years ago to launch a product that was suiting the vast majority of product on the market.

Today, you have to have that GT to be much more customer focused. And innovation, again, we have about 50 products in the last 5 years, so about 10 per year. And last year, they represented the one launched in the last 3 years, represented about 10% of our sales. So it's pretty significant innovation again.

Digitization. So I'll spend maybe a minute on this one because we talked a little bit about TAT. I'd like to say we are pretty much where Google was probably 25, 30 years ago or so, which is what the point where the industry is still collecting data right now. And the more data people are going to be collecting the more intelligence they are going to be and the more capable, they are going to be to become even more intention and even more efficient.

So what we are doing is we are trying to couple our PET technologies with our systems, so that what was initially an at-line analytical solution is becoming slowly but surely in-line analytical solutions that enable customers to track performance of their manufacturing batches life which is a huge safe of time, but also which is enabling them to definitely stop the batch at the right time and get higher yield for the batch of their manufacturing.

And then this is where the next step is going to come, which is going through more advanced analytics. You might have seen we took a minority investment in an Austrian company called Nova sign in July of 2025. And this is digital twin we are going to implement into on-generation small-scale TFF system. That is going to enable customer also to run their processes in a much more efficient manner.

What is the future vision of course, AI. I mean we all know about that. We are leaving the AI power right now every day, each of us in our companies. We know that our customers are expecting to be able to develop their processes much faster using AI tool, but also manufacturing in a more efficient manner using AI tool, but they can only do that if they collect the data, they have system with this data integrated, data -- integrated and if they have some of these advanced analytics already implemented. So it goes step by step. We think we are in a very strong position because we are leading the pack on step 1. We are pretty advanced on step 2, and we are going to start to be much more active on 3 as well.

So what about I mentioned already the increase we had with our key accounts, about 2.5x more products per key account between 2019 and 2025. In terms of geographical split, Asia is only 17% of our sales. And we know like probably the second closest to us out of the 4 big guys, 20% of its sales in Asia, but most of the others are those '25. So we really have to speed up our growth in Asia. We onboarded 2 new leaders beginning of 2025, 1 leading all of our Asia business, the other 1 leading China in particular, and we are working on a very specific Asia strategy in China for China and for the rest of Asia as well.

So mix, nothing really much to comment here. I mean, again, we like to say we are a 10-year young company bioprocessing company. I mean I used to work in another organization where I had kind of the similar split between commercial and clinical I don't see a reason why slowly, but surely, we are not going to move toward more commercial last year, increased by about 5 points in terms of commercial, and that's very much linked to us being able to get designing into commercial drug via some of our raising customer resin offering and fleet management as well.

And then in terms of product mix, if you remember last year, Newmont were a little bit higher. So you could say, wow, what happened with new modality. I say, wow, well done, guys, because even with some of the headwinds we had in '25, we've managed to beat our consensus several times and increase our guidance for the full year. And it means like the rest of the business, which is monocular antibody has been doing extraordinarily well for us in but still, we are very eager in pushing on new modality. And as mentioned earlier, we know it's going to come back to being accretive to growth in the near future here.

Okay. So what is the story here? 33 million midpoint of guidance last year. We know the market is growing anywhere between 8% and 12%. At least in the past, bad year was 8%, good years was 12%. We are aiming to be 5 points above that. So we think last year at the midpoint of guidance, we were slightly above the 5% above market. We are aiming to do the same for the next 5 years. And this year, obviously, as you all know, we have 200 basis points of headwind from a specific gene therapy drug that had some hit in 2025.

But with this 5% above market growth, where I mean to be a double-sized company by 2030. We are very committed to margin expansion. So again, at guidance midpoint, we are landing around 19% EBITDA on sales. That's definitely not good enough. I mean we are absolutely working on it, and we have a very good path forward. Jason and I to be around 30% by 2030. We are still a younger company that is growing very fast. So we are really making sure like we are combining that those huge growth we've been experiencing in the past and that we know we're going to be experiencing in the future as well with getting fit for growth because that's critical for us. But we're going to get, first of all, a lot of volume leverage by just doubling the size of the business. We're going to get some positive impact from price and product mix. And then we're obviously very focused on productivity. And finally, we are going to get OpEx leverage. I mean we've invested quite a lot in 2025. We're still going to invest quite a bit in 2026 to really scale the company to be able to operate that a double-sized company in 5 years. So we'll really start to see leverage towards the second half of this 5-year cycle here.

We're working selective investments, so R&D, innovation, again, we're spending about 6% to 7% of our sales every year in R&D, which is quite significant. I mean, I think it's significantly higher than most of our competitors, and that's because it's really part of our DNA the commercial investment, we've done quite a bit, and we're starting also to look at AI tool, not only in commercial, but across the board, but partly on the commercial side, and we're going to build out that APAC presence.

Last year, we opened 3 offices in Asia, 1 in Singapore, 1 in Japan, 1 in China, and we are really now in the staffing mode to make sure we are capable to grow much faster over there. And then in terms of dual site manufacturing, I mentioned, the vast majority of our product portfolio. We already have dual siding. There are a couple of areas where we still have to do some modest investment to move that forward.

Fit for Growth, we invested in a lot of really key poll. We built a legal team. We really reshaped the finance organization very simply big credit to Jason and the leadership as well. I mentioned AI. I mean we are already using a lot of AI tool. I mean, we are using AI on legal side with a tool called IronClad. That has been a real game changer for us. but also Palantir, we deal with those carriers mid of last year to help us on the global supply chain side. We've moved towards more of a business unit, cross-functional alignment, meaning as we are becoming a little bit bigger now, we think it's important that each of the business units who have got kind of different needs can refocus on what is their top priorities. And we had a huge focus on services and great progress on that side.

And '26, we are going to continue to build out that bench. We have a few further investment to make still some of the IT modernization, financial planning, and we're going to embed a life cycle management tool. And we've got, obviously, some strategic transformation initiatives that do include the margin expansion projects.

Finally, delivering on strategic priorities. So we've done a lot in '25. Again, we think we've grown more than 5% above market at the midpoint of our guidance with 15% organic non-COVID growth. I know I got the question, why do you still talk about COVID. We unfortunately were the last companies that had some significant COVID sales in 2024, which is why we still had to call about non-COVID in 2025.

Expansion of machine guidance implies 150 basis points of EBIT margin expansion, excluding M&A and FX, continue to innovate. I mean, we had 3 really important launch the new version of our protein concentration tool solo, which is becoming a huge success story second half of last year. So first single-use mixers, as mentioned already. And then we launched several new catalog and custom resins. We acquired 908 bioprocessing assets, which has been integrated to the organization around midyear of 2025, and we made that minority investment in Nova sign. And finally, getting to growth we made all of these key hires, and we've invested in quite a lot of infrastructure, '26 similar. We're going to grow -- outpace macros, just taking into account, again, the headwind we have on the gene therapy drug. We talked about how we're going to do that margin expansion will keep on going. We have a lot of product launch in 2026. One of them that I'm really excited about is, I call it the little browser of solo VPlus which is the new generation of our small-scale TFF system. The reason why I call it a little brother, we have a huge installed base like we had on the solo VPA side. And we know like the success that we had to generate that replacement market is probably going to be duplicated here with the TFF story here. So that's something we are very excited about.

M&A. It remains our priority one. I mean, we do have quite a lot of dry powder, as you know. So we were definitely looking at several opportunities but also considering to do more minority investment because we really enjoy what we've done last year. And finally, for growth, it will never stop, for sure, at least not for the next couple of years, but we are really making sure we were getting the right team and the right infrastructure to operate that double-sized company in the next 5 years or so.

Thank you very much. All right.

Great. Well, that was a really helpful overview. Maybe to start just on 2026. Against the backdrop, you've seen 2 consecutive quarters here of over 20% order growth. The 2026 top line framework you've laid out getting to around 11% to 12% on the top line. It assumes about 500 basis points of market growth offset by 200 basis points of gene therapy headwinds. Can you just walk us through what's embedded in the 2026 framework and the divergence between what you've seen on the order growth side versus what we're kind of starting on for 2026?

Yes. So as you know, KC, we are only reporting our Q4 and full year results at the end of February during our earning call and we'll guide as well for 2026. But I mean you just exactly summarize the framework the way it is. They basically we are aiming to outpace market growth by 5 points. And we're going to have this 200 basis point headwind what I want just people to understand about the orders because you're right, we've said both in quarter 2 and quarter 3, our orders grew more than 20%. This is reported order growth. So this does include both the FX impact as well as the acquisition of 900. So if you would retreat that and then you would compare it to the organic growth we talked about, which is around 15% or so, then the gap would be much lower. So just to help you.

And secondly, the comp were for sure, easier for us in terms of orders in quarter 2 and quarter 3. And from this year onwards, comp are going to start to become a little bit more difficult. But yes, we are very happy about how the first 3 quarters of 2025 played out and the full year as well and I'm looking forward to a great 2026.

And you've laid out a framework for operating leverage over the next few years. You talked about it a little bit in the presentation, where the gap between OpEx growth and top line growth is wider in the outer years. But the path to get there isn't necessarily linear, right? So can you just walk us through the puts and takes around the margin framework and how we should think about operating leverage in 2026 and then further out?

Yes. To your point, I'll point us back to the road map page that Olivier shared and we tried to have the key buckets that will get us to that 30% EBITDA in about 5 years. You'll notice that we didn't quantify them, but the buckets are, I'll say, relatively scaled, meaning the biggest contribution is going to be the ability to get OpEx leverage, which is to your point, growing sales at a faster rate than OpEx. But the point on the -- it not being linear is that fuel the Fit for Growth journey that we're on, we do recognize we probably need to make a bit more of that OpEx investment in '26 and probably into '27. And then as we go out later in that time frame, we'll be able to more leverage. But again, for us, that's a core foundation to be able to have a sustainable, I'll say, set a team, an infrastructure, the systems, the processes have to be able to have a business that's double in size.

The other buckets, again, we outlined as price, of course. We've been able to achieve that and see that as a continuation. The productivity, so we'll be executing productivity in our manufacturing sites, both, I'll call them the day-to-day manufacturing as well as maybe bigger projects that can take a bigger swing in cost structure.

And the last thing I'll comment on is mix. Just the dynamic there is that for the last 2 years, we've had negative, I'll say, a mix or a mix headwind you've talked a little bit about some of the procured chrome resins that we have in our chromatography, a little bit of '24, a little slower growth on proteins, some dynamics. As we look into '26 and beyond, it's not that mix becomes a huge, I'll say, profitability growth driver, but it's not the drag anymore. And so we get that I'll say, still a tailwind overall. So I think those are the buckets that we'll be driving, and we'll be able to update the team as we go through each year.

How could reshoring the reshoring opportunity really impact the timing and degree of reinvestment in '27 and beyond?

Yes. I don't think reshoring will impact that specifically. I mean, again, Jason just said, I mean, we are going to keep on investing in our infrastructure, in our people and so on. So this is going to happen, whatever happened on the onshoring side. or not. I mean, we built a lot of capacity, as you know, doing COVID. So that capacity in principle, enable us to deliver as much as $1.2 billion of sales. So it's not like this onshoring will immediately require to build more space, more capacity, manufacturing capacity. Obviously, we need to bring more labor. But beyond that, nothing in particular. And then we're going to continue that FID 4 growth journey over the next several years.

But as Jason mentioned, we're going to start to really be able to leverage it because I'll give you one example. I mean we built our legal team last year. I mean, we were outsourcing most of our legal services up to the end of last year, and we decided to build our own legal team. So probably for a year almost have a little bit of double spending because you still use the external company and you are building your own team.

From this year onward, we are going to start to switch to using our entire team completely. And then we are using also that AI tool, meaning year after year, somehow we're probably going to need less and less spending on the legal side. So that's a perfect example where you have a peak temporarily and then you're going to slowly but surely going to start to stabilize and probably start to go down after.

Okay. Maybe sticking on the reshoring theme very much in focus for investors here this week. What are Repligen's advantages and disadvantages around competing with larger bioprocessing players to win some of those resin related RFPs? What's Repligen's right to win? And then can you give us an updated view on what you think the potential incremental revenue opportunity looks like for...

Yes. So more than really what is our competitive advantage. What I think is important for people to understand is we have a seat at the table today, which we just didn't have up to probably a year or maybe 1.5 years ago. And in fact, even before those onshoring RFPs are coming to the industry's hands and so on, we received for the first time a lot of different RFPs for what is big hardware ask towards the end of last year because if you think, if you look back, since we had ATF controllers, first, we've added our downstream system, both TFF and ChromeSystem. And then last year, we added mixes as well. So when you -- of breadth of offering, we almost have everything today apart from bioreactors. And what happened as well in the same time is most of these big pharma companies have tried us they've tried to buy 1 system, 1 crop system. Obviously, they know TFF for and then they like it because they like the PAT enablement we're also bringing with our system. So we are getting those asked already. So for us, we are going to enter into that onshoring exercise where we have a chance because we have a seat at the table.

And one of the advantage we have is, obviously, we've got manufacturing capabilities in the U.S. We are probably the only company right now that has got that capability for downstream system. And even though tariff and that what is an acceptable situation, there is still 15% tariff on import from Europe. So I mean when we are going to be competing with the other guys on that side, we will at least have that 15% better pricing because of tariff -- so that's definitely something we're looking forward to.

But overall, very exciting. In terms of sizing, it's difficult to say, KC, I mean we're hearing obviously crazy numbers. I've learned over the years to discount those numbers. So when I love to make a quick calculation, imagine it's only 10% of what has been announced that's going to happen. And imagine that 10%, maybe 10% to 20% of that 10% is typically going to land into buying hardware equipment and so on. That's a huge amount of money. I mean you're talking about billions of U.S. dollars it's not so many companies that are going to be competing to -- so it's going to be a very nice opening for the entire bioprocessing industry for sure.

Maybe touching on new modalities. So your Repligen faced headwinds from a specific gene therapy platform in 2025, and that will continue into 2026. Yet, outside of that specific customer, new modalities overall has been pretty strong for you guys, right? So how do you assess the health of the new modality funnel for 2026? And are there certain areas you're more excited about than others?

Yes. No. So being very specific, you people can make the calculation with the slide we have. Last year, new modality grew high single digit, excluding Sarta. So it's not bad, but it was still dilutive to our overall growth, which at the midpoint of guidance, again, is 15%. So where it was still positive, it was somewhat not as fast as the growth we see on monoclonal last year. So why is that? Well, first of all, are we still bullish about Neal? Absolutely. I mean I'm absolutely convinced, again, this is going to become accretive to growth gain. Is it this year, probably not because obviously, we've got that huge headwind on that gene therapy drug. But I want to say probably from '27 to '28 onwards, it's going to start to be accretive again.

And then you need to be deep dive into the different new modalities because they all have very different pattern lately. And I took the advantage of the break over Christmas to read quite a lot of article. And in fact, the industry is very bullish still on new modalities. But they are more bullish on some new models than some others. And if you think about it, cell therapy seems to be really the one that everybody is very positive about in terms of -- not that far behind and ADC almost the same level. The only one that seems to be a little bit more of a concern at this stage for people with mRNA. We've seen some studies saying people are a little more careful on that side. But most of our big pharma accounts still have a lot of new modality products in their funnel and we know we are the right partner for them. So we are continuing to launch new products. We just launched 3 resin the end of last year, and we're absolutely very optimistic about it.

Yes. Maybe turning to your product portfolio here. Chromatography has shown strong momentum in 2025. I think heading into 2025, a strategic priority was focusing more on big pharma customers, including -- customers to the Opus prepacked columns. And you've called out at least 2 wins in 2025, driving strength in that franchise.

With ongoing commercial efforts focusing on pharma for prepacked columns, can you discuss the drivers behind the shift in customer preference towards those prepacked columns or product solutions, I should say. And really what's driving momentum here into 2026?

Yes. So you're right. We won really 2 big pharma accounts, and that was really a lot of work from our sales organization. Again, the key account management team doing a great job on these because it's not early to convince to convert a big pharma and convince them to switch from packing their own columns to doing it with somebody outside. What's playing definitely in our favorite cases back and I start to be old enough that I remember 30 years ago, when people were entering into a company and starting packing column, they would very often do that their entire carrier.

It's fair to say the new generation lots to do different things, and it's very difficult now to get somebody willing to pack column for more than 2 to 3 years. And it's a real hard to pack a column. So what has happened really more and more is that those pharma company realized they lost a lot of expertise.

And on the other side, they have a provider like us with packing more than 3,000 column every year and is obviously very good at doing that. So slowly, but surely, I think some of these companies realize there is a good reason to go more and outsource more of that. And I think that should be a real tailwind for us in the next few years.

And within Process Analytics, you've recently described the SoloVPE plus upgrade cycle as being in the early innings with only a low single-digit percentage of SoloVPE installed base having been upgraded. What's driving customers to upgrade? Can you lay out the time line for that sales cycle? And do you expect this replacement cycle to be a material revenue tailwind in 2026? Or is this more of a driver in 2017 and beyond?

In our business when you sell hardware, it's absolutely critical to launch a new version of your hardware every, I would say, minimum 5 years, sometimes people do even less than that. because you want beyond the growth of the market, you want to make sure you're generating a few extra point of growth because of a replacement market opportunity. We didn't do a lot of that in the past. And then on the solo solar was a really good example where we had the same product on the market for quite a while. So when we launched it, we said, hey -- well, first of all, we had to bring something different and we did bring a lot of upgrades to the new version, speed 30 seconds instead of 2 minutes accuracy of the protein concentration measurement.

But also people, particularly people who don't know how to spend their budget. So very let's upgrade our equipment and so on. So this is just starting. I mean we have a very significant installed base, which is north of 2,500 just at the beginning, we probably hit the 100 range of replacements. So that should definitely be a nice tailwind for the next several quarters, if not 2 to 3 years for sure.

Got it. That's helpful. Let's talk -- so it seems like 2026 is gearing up to be a big year for ATF, just given you delivered equipment for a blockbuster in 3Q and expect consumables pull-through to really start in the second half of Repligen has continued to win late-stage commercial customers with ATF expected into more than the 50 late-stage and commercial drugs at this point. Beyond the 2 blockbuster drugs, what's Repligen's pipeline visibility for additional consumables opportunities in 2026 and beyond? And how should we think about the number of programs that are currently in late-stage development that could contribute to revenue?

So it's a long question. So I'll try to summarize it. So if you look at what we said during our quarter 3 earnings and so on, the franchise out of the 4, that's not going to be growing at the mid-teen pace is filtration, we said 10%. And then somehow, as you all know, ATF is a significant part of it. It's not the majority, but it's a significant part of it. So just to rephrase a little bit what you said. We had an incredible year for ATF in 2024. So obviously, we grew more than 50% ATF in 2024. So we enter a year with very high comp on the ATF side. So the performance was still positive. We still had growth in 2025, but comp was so high like you probably need to look at the KOL in the last 2 years, which was very, very high and much higher than the overall growth of the company.

But as far as -- and what I want to say, I talked about the breadth of the portfolio we have. I mean, last year was a showcase for us because remember, a lot of people ask us, oh, there is a competitor on ATF, what's going on and so on. we've over delivered every single quarter because there was no competitor. But beyond that and even though filtration was probably the slowest growing franchise we had last year, the 3 other franchise grew extremely fast. So we have a very diversified product portfolio. And last year was a showcase of that.

In terms of the future of ATF, we are absolutely delighted, very optimistic. I mean we've had a lot of great wins in 2025. Yes, I know I talked about that blockbuster. I mean, maybe I should not, but that was my first earnings call as the new CEO. I think what's more important is why in 50 drugs that are late stage or that are really commercial ready, and we see this volume increasing for the next 4 years. beyond that with customers who have been using it for only 1 product who are starting to use it for a second, the entire portfolio of Mabe, but also people are using at the minus 1 level. We are starting to do it at the end level as well. on the scale from 1 to 10, I'm saying we're at anywhere between 2 and 3 right now in terms of the runway we have for ATF. So we at the beginning of the story still.

What opportunities are there to expand the strategic initiative to add additional accounts? Are there any specific franchises that are serving as like a tip of the spear type of initiative for broader account entry. And on some more note, is there anything missing from Repligen's portfolio that customers would ask for that you think you could fill inorganically?

Yes. So I don't think it's so much about adding more key accounts. I mean we were covering 20. I think it's a sweet spot about 16, 17 pharma 3 to 4 CDMOs. The reason why I'm hesitating is we are changing some time. I mean, every year with Greg, who is leading our key account management team who are sitting together and figuring out does this customer deserve a key account or do we bring somebody else into the program because we might see somebody else starting to generate a lot of opportunities. So for me, it's more about making sure we really tackle the 20 we are focused on. And I mentioned the fact we're also selling them 2.5x more products than we were 5 years ago in average. We just need to make sure we are capitalizing on that.

We are delighting them with the best service they can get in the industry, very high level of quality. And again, with the right level of innovation, we need to bring them so that they feel we are the partner of choice for them. If we continue to do that and we've executed on that extremely well over the last 3 years, I think we're going to be up to further successes.

One thing I didn't mention is growth we had with key accounts over the last 2 years have been very accretive to the overall growth we had in the company. So we are delighted, and we are going to keep on pushing that side for sure.

Maybe last minute, just can you just provide an update on the 908 integration and the funnel for 2026.

Yes. No. I mean, everything went pretty much on plan. I mean the first priority for us we had to move manufacturing from 908 in the Boston site to our own site in Marlboro, Massachusetts, which has happened very smoothly. And then secondly, we have merged 2 sales organization, which has happened to work extremely well, and we are really delighted to see the progression we've had on the funnel side and we are very optimistic, again, we said it's a mid- to long-term play. I mean, it's nothing like are to see fantastic stuff in the next 1 or 2 years. But really, we are now having the best PAT technologies that we're going to be able to couple either with our ATF system or anything else in the future, which will be a big differentiator.

Okay. Maybe last 1 quickly, what are you most excited for 2026?

Everything. So many opportunities I'm very excited for sure about the journey.

We'll leave it at that. Thank you, Repligen, for joining us today. Thank you, everybody, for joining us. Have a great rest of the conference.

Great. Awesome. Thank you, everyone, for joining. For those of you who don't know me, I'm Daniel Markowitz. I cover the life science tools and diagnostics at Medtech space here at Evercore ISI. Today we're joined by Repligen. We have with us CFO, Jason Garland; and from Investor Relations, Steven Chehames. So thank you both for joining.

Thanks for having us.

Hi, everyone.

Awesome. So lots to get into here. I would love to just start off on 3Q performance. So I think you guys delivered 18% organic growth, double-digit growth across every franchise. Can you just talk about some of the drivers of this performance? Were there any standout products or customer categories to call out?

Yes. We were really happy with the quarter. Again, just the continued momentum that we've seen through the year. As you said, it was really strength across all the franchises. When we look at our customer segments, whether it's pharma, CDMO, all strong, even saw emerging biotech kind of have so growth for the quarter, which is really the first time we had seen. So looking forward to seeing that trend continue as well. From a franchise standout, really two things I'd share. Proteins did very well. So again, we're coming off, I'll say, a better comp from '24, but we've seen a lot of good growth across the Protein segment and saw that in 3Q. And then the second thing I'd highlight is our Analytics business. So -- and this is -- we've talked about -- if you go back, our analytics business, it has the CTech acquisition we did years ago, and then it now also includes the 908 devices that we add to the portfolio. But for the legacy CTech analytics, we have two products generally, the in-line and then the at-line. So the in-line is for continuous monitoring, our FlowVPX and then the at-line is we've had our SoloVPE, which again, you have to take a sample and then measure outside the flow. That product was several years old, probably even 10 years, and we launched an upgrade in -- early in the year. And so we've seen really good momentum on that upgrade cycle. Good news is that we're in early days on that. We've got an installed base that's probably north of 2,000 units in the field. And year-to-date, we've probably upgraded only 3% of that. So -- but again, saw some good growth in the quarter and through the year as a result of that. And again, excited about how that continues to grow going forward.

Great. You called out emerging biotech, and I think the language around that was highest level in the past three years. Can you just describe what you're seeing in that end market, your outlook? And is this mostly the macro improving, or is this Repligen-specific share gains?

Yes. I mean it's hard to kind of to dissect that entirely. I think it's probably a little bit of both. At the macro level, I think everyone probably sees the same data that we get, but we've started to see funding pick back up, right? So we certainly had that in October in the third quarter, continued at least year-over-year growth in November. So that becomes the earliest indicator for that segment in particular. There's certainly going to be a lag, right, probably 6 to 9 months from when funding starts to pick back up and then when it might actually translate to orders and sales. But yes, I mean, we're optimistic. I mean, honestly, it's a data point of one. So we need to see if there's that continued trend of growth for that space. But we feel like we have a good offering, both the products as well as the scale and size of the products to fit that market and -- as well as just our commercial outreach. So we're excited to see that -- maybe turn around here.

Yes. Let's hope. And then on equipment, been growing pretty meaningfully above peers for several quarters in a row now. Is this entirely driven by ATF? Or is this more broad-based across your equipment portfolio, or anything else to call out in terms of what's driven the delta between you and peers?

Yes. So it's a good question. I'd bucket the biggest part of our hardware sales or equipment sales would be between three pieces. It's the ATF as you mentioned, the hardware controllers that we sell. The second is the analytics piece that I just described. And then the third would be the more traditional downstream filtration systems. So that's kind of the three pieces. I do think that what we're seeing in our downstream filtration side is probably more in line with what the industry and the peers have been talking about, a little softer overall. And then we've been able to more than compensate that with both our ATF strength, as you mentioned, as well as the analytics dynamic on the upgrade cycle that I just talked about. I'll just note one more thing on the ATF. There's a dynamic here where in environments or where there might be uncertainty or questions about, okay, where do we invest capacity that might drag some of that overall equipment spending down, right? And we think that's probably that overall market dynamic. But ATF kind of has its own cycle. In fact, oftentimes investing in ATF will reduce your overall CapEx spend because you can defer or even prevent the need for capacity expansion because you're able to intensify and get more output faster. And so my point is it's just a different economic decision and cycle on the ATF. And we think that, that certainly has been a part of that growth, just again, as well as the adoption and penetration of ATF overall.

Got it. And if I try to parse out the contribution from those two different pieces, the ATF hardware controllers versus analytics, any sense on the size of each of those businesses? I guess within ATF, how much of it is equipment versus consumables?

Can you split that out?

No, we haven't really split that out. I mean, again, the analytics would be the much smaller piece of the three. It's just a smaller ASP for those products. And so really between ATF and the downstream filtration, those would be the biggest parts of the hardware overall.

Got it. Okay. And then if I think about the orders, grew more than 20% year-over-year, and we're up sequentially for the sixth straight quarter. These are all positive trends. How should we be thinking about the relationship between orders and revenues as we move through the fourth quarter and into 2026?

Yes, it's a good question. So first, just note, when we've talked about orders in that 20%, that's on a reported basis. So you've got acquisition orders in there, and you have the benefit of FX. So when you try to compare that 20-ish percent on the orders, versus the organic growth rate on sales, there is that difference. So if you -- we -- and we haven't -- we don't report organic orders, but you get a lot closer to that sales growth rate when you account for those pieces. So that might address just the, "Oh, hey, guys, what you're growing so much at orders, why aren't we seeing that pass through to sales?" There's a little bit of apples and oranges there. Typically, we'll walk into a quarter with probably 2/3 of the sales for that quarter in backlog. So you only then need to capture maybe 1/3 of the remaining piece within the quarter. And so that's why, again, it's those earlier quarters, as you were suggesting that help to drive where does your sales fall through and less about the orders that you get within a given quarter. And most of those orders you get about 1/3 will translate to sales in -- well, in the same quarter, 1/3 in the following quarter. And then the last 1/3 will be somewhere between the quarter after that and maybe you might have some things that play out a little bit longer. So that's why we're actually trying to move away, as you may have heard to on the call, away from disclosing orders growth rate and really just remain focused on sales, and how that's playing out. And certainly, we'll be transparent about trends we see and anything major or material to share as it relates to that trending, but we want to get more focus on the sales line.

Right. Got it. That makes sense.

Public service announcement there.

Definitely. That makes sense. So if I look at your 4Q outlook, I think it implies low double-digit organic when you strip out the headwinds from a gene therapy customer. Can you kind of walk through the assumptions there? So looking at low doubles organic, and that's versus I see 18% organic in 3Q. So I guess, is there conservatism? Or I guess what accounts for kind of the step down?

Yes. I mean, so -- and you say stripping out the -- because certainly, the gene therapy is a piece of that difference. I think the other thing, too, is, frankly, there's just a different comp sort of dynamic fourth quarter versus prior year fourth quarter versus third. And then again, we also talked about just some of the timing of sales that hit in the third quarter. Particularly, we talked about the ATF -- a fairly large ATF hardware delivery, where going into 3Q, we weren't sure if it would ship at the end of September or early October, and it played out to be able to get that to our customer, and they wanting that in the end of 3Q. So some of that's just a little bit of timing, too, across the quarter points. So nothing more to really highlight other than comps and a little bit of timing.

Got it. Okay. Great. And then zooming out to like the longer-term framework, the framework is to grow -- outgrow the market by about 500 basis points. I guess what do you see as the main drivers of that?

Yes. So I mean, it starts with the strong, I'll say, technology and differentiation that we bring, right? So it starts there. Second, I think the thing to keep in mind, to outgrow a market, just I'd say mathematically, there's kind of 2 pieces to it. There's the -- are you taking share, right, from others in there, and that's the way to grow above market. And then the second piece, which is really more of the dynamic for us is we've been creating markets, right? So if you look at the lion's share of our portfolio, ATF, right? There really isn't anyone else selling that. And so every dollar, every point of growth is a growth in the market -- in that market, right, which is, again, by definition, outpacing the rest of the market that it's not a part of. And so ATF is that way, Analytics is that way. I could argue even the prepacked columns doesn't really have a direct competition in what we offer. And so any time that we're getting growth in those areas where we've created the market, that helps us to be accretive to an overall market growth rate. The other piece is our commercial clinical mix is a driver of our ability to kind of outpace market. Certainly, there's an element of where we are in our kind of trajectory as a company. We like to say we're only 10 years young, right? So there's that dynamic of when -- as we started, we've been able to capture and grow as programs go through the clinical phases. And so that allows for a steeper growth rate. Now as you get bigger and bigger, those are smaller numbers, smaller programs. And so the math doesn't help you. But for where we are now and over the next few years, that movement from clinical to commercial and as you make the steps up through the stages is definitely another way that we're able to grow above the market. And then new modalities as well. I know this year, of course, it's a different dynamic, particularly with that one gene therapy program. But we do see in the mid- to long-term that new modality will continue to be a strong growth driver for us, and we are more heavily indexed to that. We're still about 80-plus percent mAbs, but we're with 20-ish or a little less than 20%, that again helps us with our mix of business for growth. And then the last piece I'd say is the commercial side of our execution. We feel like the key account strategy that we've been executing has provided a lot more, I'll say, looks at RFPs, looks at opportunities and this idea of being able to bring a more fulsome portfolio offering to customers. And we've been able to capture some share and get some looks that way. And then the last piece within commercial and overall would be Asia as a region, we feel like we're under-indexed there as well. And so meaning our Asia sales as a percent of our total sales is lower than a lot of the others in the industry. And we feel like that, that's an opportunity for growth for us as well that helps. So kind of put all those pieces together, and that's kind of the algorithm that we're running to grow above market.

Yes. That's a solid amount of drivers. So I think there's been some market noise that maybe new modalities, if that's not going to be quite as strong of an outlook after this customer situation, is the 5% above market growth still intact? It sounds like I'm hearing your message is, yes, still very much intact.

Yes. And I'd just tack on one other piece. I think one other important message that I want everyone to really absorb is we are -- have a much more diverse and broad portfolio than we did 5, 10 years ago. And so again, even just go back to that gene therapy, when we took that out of our outlook, we were able to replace it and in fact, still raise guidance slightly, even absorbing that pressure point, again, meaning that we've got diversity of our products. We've got diversity of customers. We've got diversity of programs within the customers. And so if one thing isn't growing as fast as we might want it to or for a given year, we've got a lot of other ways to get there.

Definitely. Great. With that, the new modalities, it is a relatively distinct growth pillar. What's the rough split of that business between -- when I look at AAV versus mRNA versus cell therapy?

Yes. So we typically run this, call it, once a year, but a directional split, call it, in the mid-50s, we're exposed to gene therapy. This is all as a percent of kind of the new modalities. mRNA is kind of north of, call it, 25% or so, and then the remaining is going to be cell therapy and other. The good thing is we've seen a lot of traction on the cell therapy side. So we're pretty optimistic for that modality, especially with ATF.

Great. If I could just ask one on cell therapy. Is it mostly different programs progressing through the clinic, or is there a commercial ramp? I guess what's driving the strength in cell therapy?

Yes. So ATF, we called out in Q4 of last year, ATF got spec-ed into a cell therapy platform or program. And in the event that, that does become commercial, it certainly can be a pretty meaningful driver for us.

And now it's less on the commercial side.

Correct.

Got it. Got it. Okay. And I guess, broadly within new modalities, how would you describe the demand environment? You mentioned cell therapy is driving good strength. But I guess across mRNA, AAV, what's the general demand environment like?

I mean outside of that one gene therapy program, we haven't seen a lot of change in opportunity or activity. So again, we kind of still see strength across those pieces. Again, we're pretty excited about cell therapy, like you said, but everything really is kind of stable in terms of that overall activity and opportunity base.

Got it. And then on the mRNA side, is there a lot of customer concentration here? Because if I just think about the mRNA therapies that I know of that would be lumpy, it comes down to not too many.

Yes, you're right. I mean that's one area that we've probably got more customer concentration, but still, again, a lot of activity and a lot of opportunity to grow with them.

Got it. And is that mostly clinical or on the commercial side?

I don't know if they split that. [indiscernible] split that one.

Okay. No worries. Next on the AAV customer headwinds, can you just -- for those in the audience, can you just remind us an overview of the disruption to the business and the kind of a quantification of it?

Yes. So we had called out that there had been about $10 million of sales in the first half. We had done $3 billion in July when we had kind of shared this overall dynamic later that month. And then -- and talked about the second half really having de minimis sales. So there have been some things that we had already agreed to ship, and so it still went out. So overall, a pretty meaningful drag. And as we talked about a little bit for -- or it's been out there a little bit that this will remain a headwind for next year as well in 2026 of about 2 points of growth. So I know there's also been a lot of questions or references to us about, hey, that therapy is still ongoing, right? There's still patients, and we recognize that. Our view is that there's probably enough inventory in the system that if things continued, we still wouldn't expect any incremental orders or sales next year. But certainly, if it steady states with that sort of still usage, we might see some in the future. But right now, we're really being, I guess, clean about taking it out. And then if there's anything that comes through, it's upside.

Yes. I think that's the right thing to do. That makes total sense. And I think you already touched on this, but the AAV disruption with that customer, has it bled into any other AAV customer activity or any broader disruption?

No.

Got it. Is that something you're monitoring closely? Or would you have expected to have seen it if there were an impact by now? I guess, how are you thinking about the risk that there could be some change down the road?

Again, we monitor it closely like with any activity. Again, we -- when we provide our guidance, we're balanced on the risks and opportunities that sit within the broader portfolio. I think this one, in particular, had some specific things that certainly, I'm not the expert to talk about, but that I think are outside of the broader sort of application in market. So that's why, again, we still haven't seen much erosion in activity beyond that one.

Great. Great. And then if I think about back to 2026 long-term algorithm, on 2026 framework, I think peers are generally pointing to about high single-digit growth. And if you grow 5 points above that and then take down a 200 basis point headwind from Sarepta, is about 11% to 12% kind of a reasonable starting point for investors to anchor to?

So that's the math that the framework would suggest. I've said it all morning, and we haven't given guidance yet. And -- but that we continue to look at '26 with that lens, right, that we can grow above market on average 500 basis points. We went through a lot of those reasons and growth drivers we have. You backed out the gene therapy impact. And then it's that baseline to your point of, well, what's market. I think, yes, the -- over the last couple of months, we've heard some more positioning around that high single digit, right? That's probably a little different back in the summer. And so that's what we walk into. But what I'll tell you then is, again, when we give guidance in February, it's going to be, here's our view, Repligen's view of our sales and our view for 2026. And it becomes less about, "Oh, I have to start with this variable market." It's here's what we see line of sight to, right? And that's what we'll share.

Got it.

No change in framework and guidance to come.

Yes. And then are there any level -- like high-level headwinds, tailwinds to call out by franchise? Any specific segments you'd expect to be above or below corporate average?

No. I -- again, we'll share some more views of that in February. But at this point in time, we would see that all the franchises are kind of plus or minus around that overall sort of average company growth. So there's certainly some that will look to help us to be growth accretive, but the ones that are on the other side of that aren't far off. So they're all kind of close to that median.

Great. And then if I think longer term, can you talk a little bit about the onshoring opportunity?

Yes. So I know a lot of dialogue about this, and how big the size of the prize is, I think, still remains to be seen. For us, I think we're excited about the opportunity in a couple of different ways. Number one, you got to remember, when a lot of capacity was built the last time or last gen, we just didn't have the portfolio and the presence and the credibility in the industry that we do today. So we're confident that now when new capacity considerations are -- come to play that we'll have a chance to bid, right? And that we'll have a chance to bid participate in those RFPs and demonstrate the value that we can bring. Because we do believe that our products really almost across the board, but holistically help to create efficiencies, help to improve yield, right, ultimately help to reduce costs. And so we do believe that, that will be a lens that anyone is thinking about new CapEx spend or capacity increase will bring, that's one. Two, from a -- the concept of, "Hey, if we're going to onshore in the U.S., the company should strive to include U.S. content." I think we benefit from the fact that 90% of what we sell within the U.S. is made in the U.S. or as a very specific exemption. So again, we feel like we'll be able to fit that as well. So again, I think the quantification of how all this plays out remains to be seen. I think there's always going to be this question of, is it really incremental capacity in the system, or is it just, "Hey, we were going to put it somewhere else, or we're going to put it in the U.S., or we hadn't decided where we were going to put it, but we're going to put it in the U.S." And so -- but we're excited that we're going to be able to participate in a much different way than we did in the past.

Right, right. That was my follow-up. Is the benefit really just a onetime instrument placement, or do you think there could be more to gain from an onshoring opportunity?

I mean we had this discussion this morning, too, with some -- I think we still hold to the view that ultimately, the usage of consumables is going to be driven by the ultimate demand for the drug, right, and the therapies that they're using. So -- and you're back to, okay, if now you have two factories producing that same amount, it's not like you double the consumable use, right? They're going to share that. So I think there is this to your question, the onetime gain or the incremental hardware that comes with it. And I just think the people have to be careful about how they think about the consumables modeling on the other end of that and not get ahead of the overall drug demand.

Right, right. And if I just think about the time line, when and how would you expect this to show up in Repligen results? When would you see orders? When would you see revenues? What's the time line breaking ground? Like what's the time line on all this?

I mean well, first, it depends, are they greenfields, or are they brownfield or expansions, right? Greenfield could be years out. More of the brownfield or expansion opportunities, we might start to see some RFPs in '26, maybe those translate to orders either in the year '27. So I think it plays out over the next couple of years. No real sales to speak of in '26.

Got it. Okay. And then one more on the longer term. The margin target you guys put out for about 30% EBITDA margins by 2030. That implies over 200 basis points a year of margin expansion. What are the drivers that you see on how we get there?

Yes. So I think, hopefully, you'll feel like just like the growth drivers on the top line that we've got several different things that we're running towards. I mean, number one, if you kind of split that between gross margin and the OpEx dynamic, we -- it's probably about 1 point plus that we get kind of each year on the gross margin line. And then the rest of it is going to be driven by getting leverage on OpEx, meaning growing OpEx at a rate lower than the top line. The way we're thinking about this from a trajectory is that probably over the next couple of years, we -- the difference between OpEx and top line growth is probably less. And then as we get out beyond year 3 or 4, 4 or 5, that we start to be able to scale at a different way and get a little bit more leverage. So kind of -- I can't see it on the transcript, but kind of this flatter over the next couple of years and then more steep incline towards that 2030 target. So then you peel back the pieces beyond the OpEx, it's the growth drivers at the gross margin level. Certainly, there's a volume element as we build scale. We still see a path to getting low single-digit price each year. And then at the same time, we'll always be paying our employees a bit more and have some inflation that we have to offset. And then the other big driver then will be generating manufacturing productivity, right? And I would just kind of parse that into two pieces. There's the day-to-day, we call them our RPS projects that we're generating productivity in the factories every day. And then there may be other bigger initiatives, whether it might be site optimization or other, I'll say, more meaningful either product changes or others that can help to then close -- bring more productivity as well. So it's going to be both of those pieces. But I think that the team has been continuing to focus here, and we're building a lot of good muscles on driving that expansion.

Great. And I guess where does capacity utilization stand today? I know there's been some rightsizing over the last few years. But I guess, as a percent of total capacity, what's being utilized? And what was normal if I think back a few years ago?

We still feel like we could probably double the size of the business without really any major, I'll say, four-wall expansion. Certainly, as we continue to grow, there'll be equipment additions for CapEx. As you know, in our industry, clean room space is an important part of the production areas. And so there may be additional clean rooms that need to be built out. But we still feel like we've got a lot of good room. To your point, as we optimize sites, that may change some of that algorithm, but we feel like we've got a lot of good room where it's not, I'll say, really meaningful expansion of four walls over the next 4 to 5 years.

Got it. Yes. I'm just flipping through my model. It looks like 2019 to 2022, incremental gross margins were like right around 60%. So is it fair -- I'm just backing into what gets you to that about 100 basis points plus of margin expansion. It seems like low 60s incremental gross margins. Does that seem like looking back at what it used to be, we should be right around there, maybe a little higher?

Yes. I haven't calculated it that way. I think we've got -- it should be close. I mean, again, we still have -- in addition to the depreciation and the occupancy costs, there's other, I call them like semi-fixed or semi-variable costs that don't necessarily scale at that same level. So -- but in the end, that's probably pretty close.

Great. Next, I wanted to turn over to ATF. I think that's a really attractive part of the story. It's been a really, really good business for you guys. So you called out as a driver of equipment strength. I guess I already asked -- you can only say the exposure to equipment versus consumables. But I guess in terms of how much that mix could shift, is that going to be a material driver of shifting? I assume now it's more so hardware than it's going to settle out in the longer term.

So interesting enough, Q2 of last year was the first time we actually saw consumables outpace capital equipment for ATF. And I think that's just a testament to the actual pull-through that we're starting to see with the installed base that we've had over the last, call it, since we acquired the actual product in 2014.

And when you say outpace, does that mean it was more than half of the mix or the growth rate was higher within consumables?

We didn't break it out, but the dollar value was higher of the consumables and capital equipment.

Got it. Got it. Okay. And with time, is it going to settle out somewhere near where the rest of the portfolio is, where it's like 80-20 type mix?

Yes, I think that's fair. So just the split of the overall revenue from a company perspective is, call it, 70% consumables, 25% capital equipment and then 5% service.

Right. Great. That's super helpful. Okay. And then you've highlighted a long runway for ATF with more than 50 late-stage and commercial programs and mentioned there was another blockbuster placement since 2024. This is obviously a big growth driver in 2024 with over 50% growth. Are there any comments on the growth outlook for 2025 and beyond? Should it remain above corporate average for the foreseeable future?

Yes. So we don't break out specific guidance by product. But just to go back to the 2024 comment. So in 2024, ATF in general grew, call it, 50%. That blockbuster that ATF got spec-ed into in Q3 of last year did not contribute to the growth. So that capital equipment was actually delivered and realized as revenue in Q3 of this year. And so we'll expect consumables pull-through for that program, call it, in the back half of 2026.

Got it. So 3Q this year, the one between September, October, that's the one that was from last year. And then you said consumables probably not until back half of '26?

Correct. So the growth that we saw in ATF in 2024 was primarily driven by the 9 late-stage and commercial processes that got backed into in 2023.

Got it. And I guess, what's the scale of those 9 late-stage ones versus this big blockbuster?

Yes. So we haven't broken it out like that, but just to phrase kind of the opportunity for ATF. And this is for N-1 applications. The economics get a little bit different if you're talking about a perfusion process. But for just a regularly commercially approved drug that ATF gets spec-ed into, the consumables pull-through is probably in that low to mid-7 figures on an annual basis at peak volumes. And then if it's a blockbuster drug similar to the one that we called out in Q3 of last year, the consumables pull-through on an annual basis, again, at peak volumes, assuming ATF is implemented across all their manufacturing sites for that drug could be in the $15 million plus.

Okay. Great. And on the point on the N-1 versus perfusion, I think there's been some sort of investor eyebrows raised because I think we've been told by the bioprocess industry for so many years that there's this dynamic where you get specified in, and then it's hard to break from there. I think it's -- what explains is how you've been able to win that is that it's N-1 applications mostly. I guess, can you talk about the difference between N-1 versus perfusion, and how much of the business is one versus the other in ATF?

Sure. So when we acquired ATF in 2014, it was primarily used at the end stage. What we've noticed is over the years, there's more opportunities in the N-1. I mean 70% of the workflows are done in fed batch and then the remaining being done in perfusion processes. When you're using ATF in the N-1 stage, you're attaching it to the actual seed train bioreactor. And so you're not really changing the process. You're essentially adding a loop to the process. And so if you're not using ATF in the N-1 stage, you might be running your process for, call it, 14 days to get the number of cells that you need for the main bioreactor. By attaching ATF, you're essentially speeding that process up. So instead of running the process for 14 days, you implement ATF at the seed train bioreactor, and you're running your process for, call it, 5 to 6 days, getting to the same cell count that you need in half the time. If you're using ATF in a perfusion process where you're attaching it to the main bioreactor level, it's not necessarily about speed. It's more or less about increasing the actual cell count. So say your original process, and these are hypothetical numbers, say your original process calls for 100,000 cells. Well, if you implement ATF, you can scale that two- to threefold. So you can end up with 200,000 to 300,000 cells in the main bioreactor. The problem is your original process for your downstream was accommodating 100,000 cells at the main bioreactor. So you essentially have to change your entire downstream process if you implement ATF at the main bioreactor because you have 2 to 3x the cell count that you originally had.

Downstream becomes the bottleneck, whereas upstream traditionally.

Right. So there's less of a regulatory hurdle for customers if they're doing it at the N-1 level.

Yes, there's still a process they have to go through. So I think this particular blockbuster drug we got spec-ed into, the customer went through, call it, 8 to 12 months of filings versus starting back at the clinic and having to scale up. And then the reason I said that the economics are a little bit different is if you're using ATF in the N-1, you're probably attaching 2 to 3 single-use ATFs to that seed train. If you're using it in the end stage, you could be attaching as many as 7 to 8 single-use ATF.

Got it. Okay. So is it fair to assume that any already commercial drugs that you win are in the N-1 stage and then perfusion would be only the new things coming to market?

So we do have a couple of customers using ATF at the end stage, but there's more opportunities, and it's more skewed towards N-1 today.

Got it. Great. Next, are you seeing growth in this number of late-stage and commercial programs, mostly from progression through the clinic? Or is it also share gains in the -- I guess, what's the contribution from already commercial versus progressing through the clinic?

For ATF specifically?

Yes, yes.

So we haven't broken that out, but you could assume it's more commercial based.

Okay.

And as we mentioned, ATF is in, call it, north of 50 late-stage and commercial processes today.

Got it. Is there concentration within customers who might roll out ATF in one program and say, this thing is great, let me roll it out in more programs, or is this more broad-based across different customers?

Yes. So we're in, what, 9 out of the top 10 CDMOs. But in most of those cases, they're only -- it's only with one program, right? So there's an opportunity to add programs or the real like -- the real opportunity is you get platform so that whenever you've got a bioprocessing or a reactor for a certain either molecule or process that you're always have ATF spec-ed in. And then on the pharma side, we've been making good inroads there as well, not quite as heavily penetrated, but we've also been fortunate as well to see at times some of the CDMOs have been, I'll say, requesting ATF in order for them to take the production from pharma is to say, "Hey, we'll do this if you allow us to do ATF." So you kind of get some of that support from -- as well, not only us pushing the technology, but CDMOs saying, "Hey, this is how we want to develop it because it's the most efficient for us."

Right. Yes, that was my next question. If you're in 9 of the top 10 CDMOs, I guess the question was how much control do they have over what the workflow looks like versus just being told by the pharma company, here's what I want to...

We're seeing real examples where they're again insisting that for them to take the molecule that they want to -- they need to implement ATF.

Is that because the economics can be better for them?

Absolutely. Well, for everybody, right? It would be better for them, and then that will pass on to pharma.

Yes. No, I mean it sounds very compelling value proposition for everyone. So beyond the programs, I guess, how broad is adoption generally in ATF? How much of a standard is it? And I guess, how penetrated do you think it is in the market today? Is it still less than 10%? How much is the opportunity ahead?

Yes. So from a penetration standpoint, it's hard for us to kind of give you an exact number, but we do think that we are in the early innings, if you will, of ATF. As Jason mentioned, 9 of the top 10 CDMOs are using it in at least one program. We're working on that 10th. The vast majority of large pharma are implementing ATF as well. But if you think about the kind of breakdown, it skews more towards mAbs, but we are seeing adoption of the new modalities. And I think we touched on the cell therapy win that ATF had in Q4 as well.

Great. And with any strong growth driver where there's a nice competitive difference, you get the question on competition. I guess, how would you describe the competitive environment for ATF? It seems like it's kind of in a category of its own today. Is there anything you're monitoring on the horizon in terms of potential competitive entrants here?

So if you think about process intensification, there's two technologies, ATF, which we are the sole provider. And you can also use a TFF process as well. The great news is that we offer that solution too. And so that if you have a producer that says, you know what, we're all in on TFF, then we can provide that as well. And we've had success with being able to sell those solutions. TFF is where there has been discussion of other players coming to market with their version of it that could be used in intensification. So we haven't seen a lot of it yet. We still feel like ATF is the superior technology and that we can continue to lead in that way.

Great. And so we got the high-level framework on '26, which was helpful as an early starting point. Are there any things we should keep in mind on -- in terms of the margins, anything on the OpEx line or gross margins that kind of onetime headwinds, tailwinds we should think about entering '26?

Yes, I think we still see a framework where we can grow gross margins kind of up 1 point plus and then get more leverage at the -- on top of that by growing OpEx less than our top line. I just think that, again, I talked about the trajectory over the next couple of years that there are more fit-for-growth investments that are important for us to make over the next couple of years because, again, the -- and you talked about capacity, physical manufacturing capacity. We also just have the capacity of all of our business processes that we have to, I'll say, strengthen and expand and through whether that's the teams we have, whether that's the processes we use, the systems or technologies we have. And so that's where we're really focused on ensuring that we have robust processes in order to be able to scale and to scale with the increased complexity, right? When we -- the great news about broad and diverse portfolios is we can cover ebbs and flows, but it does add more complexity, and we have to have the right ways to manage that to protect that growth.

Got it. Makes total sense. So I see we have 30 seconds left. In the last 30 seconds, on capital allocation, how are you thinking about capital deployment here between M&A, internal investments, potentially returning capital to shareholders? How are you thinking about those different?

Yes. Our priorities will be the internal investments we've talked about, but -- and then M&A becomes a continued priority for us. We've talked about where would we fill out the portfolio in terms of gaps. So in the traditional mAbs workflow, there's three areas that we don't provide right now, bioreactors, cell culture media and viral filtration. And so we remain open to those opportunities. And then in addition, on the new modality space, and we talked about the way we think about growth there that are there -- that's a different set of workflows and different solutions. So we're also very open to seeing what's available and can fit with the portfolio on that side as well.

Great. With that, I think we're out of time. Thank you both for joining.

Thanks for your time. Thanks, everyone.

All right. Good afternoon, everybody. I am Doug Schenkel with Wolfe Research. It's my pleasure to welcome Jason Garland, Chief Financial Officer of Repligen; as well as Steven Chehames from Investor Relations. Thanks to you both for being here.

Thank you.

So Repligen is, as everybody in the room knows, but just in case, Repligen is really one of the only publicly traded pure-play bioprocessing companies available to invest in. And the company not only stands out for that reason, but there's just a tremendous history of innovation, tuck-in acquisitions that feed into that innovation, which together has fed consistent above market growth, so we appreciate you both being here.

In terms of the agenda, I thought we would spend a couple of minutes just recapping some loose ends from Q3. It feels like that was a while ago now, but it wasn't -- I guess it wasn't that long. But -- so maybe a few things to talk about just in terms of -- I think things that might be helpful to double-click on as we think about momentum into next year.

With that in mind, then I actually want to talk about the framework for next year, which I think has got a lot of focus coming off of the Q3 call, which I bet you guys have heard here and now. And then I want to get into some longer-term growth drivers, so that obviously includes ATF, but we'll go beyond that as well.

Great. Excellent.

So Q3 revenue was -- you beat The Street by about $7 million. There was strength in analytics and proteins. Very quickly, how much of that was fundamentally just better than expected versus timing dynamics?

Yes. No, so first, you're right, it was a great quarter. We were up 18% organic. And underlying that, though, was really strength across the portfolio. So to your point, there's a couple of standouts I can talk about, but we saw strength across the franchises, across the regions, across our customer base.

So really happy with the results. I think to your point, some of the beat on expectations were really driven by those 2 that you highlighted, the proteins business as well as analytics. I think with proteins, just think of it that can be lumpy, right? You can have just deliveries that hit all at once, that was primarily the driver there. So a little push and take within the year, but overall kind of a lumpy delivery that happened.

Analytics, I think what we've seen is now a real strong momentum within our CTech piece. So again, if you remember as well, our 908 acquisition, the assets we bought from them are in that bucket as well. But the real strength was this momentum we're seeing on an upgrade cycle that we've started.

So as a quick refresher: In our CTech analytics, this is our PAT technology, we do measurements in line, which we often connect to our filtration systems, downstream filtration systems. And then we have an at-line product, so you have to take a sample and measure. That product was, call it, 10-years-old-plus. And so we launched a new version. Think of it as the next version, more features, functionalities earlier in the year.

And so we've been pushing that upgrade cycle and it caught quite a bit of positive momentum in the quarter, a little bit maybe higher than we had expected. Great news is we're in early innings, right? I mean we've got more than 2,000 units installed base. I think our calc is maybe we've covered 3% of the upgrades sort of to date. And so a lot of good runway on that as well.

So I think to answer your question, some positive momentum there, a little bit timing more on the proteins piece and just again, the lumpiness that you can have across really the franchise, but really happy with the third quarter.

Equipment, which is about 20% of sales. I mean, we cover, I think, the full spectrum of bioprocessing companies. You're seeing strong consumable growth across the category. You're not seeing it almost anywhere on the equipment side. So to say you guys are outperforming the peer group with a quarter where I think you were up 20% on the equipment side is probably the understatement of the day. What's going on there? Like is it mostly ATF or is it broader than that?

So it's broader than that. And so again, if you think about our hardware, the equipment side, there's the downstream filtration systems. And I think we would say that though we've seen some positive momentum that it's still not back to where we'd hope or expect it to be. So maybe more consistent with the overall messaging you're hearing.

What has really then helped pick up that whole group for us is ATF and then the analytics. So I mean, to close out the analytics, the same thing we just talked about, all of the momentum on the upgrade cycle, that would fall into our hardware bucket as well. Obviously, it's at a lower price point than many of the other equipment pieces, but still a positive lift.

And then in addition to that, ATF. So when we sell ATF, there's certainly the single-use filtration cartridges, if you will, in those elements, but we also sell controllers with it. And so the controllers would be grouped within our hardware. And I think our view is that it's outside the economic cycle that some of the other hardware would be, right?

If companies are thinking or pharma or CDMO are thinking about capacity expansions or those type of investments with some of the, hey, what's going on in the industry sort of question marks, you can dial that down, right? You might wait.

But ATF, it's outside of that economic cycle. I mean -- and in fact, it actually supports that because in many cases, the decisions customers are making is I can invest in ATF and prevent the need to build a new line, right, or delay that need for a new line. And so -- and again -- and even if it's just a, I'll say, not a capacity decision, but just a yield or a faster output, again, that's an economic decision that is contained within that ATF purchase and not the broader. So I think that's why we've seen some sort of outpacing of overall hardware, kind of those 2 dynamics.

I'm going to ask a somewhat related follow-up. So you've done better in equipment hardware for the reasons you discussed. What we've seen more broadly is there's just been a lot of, we'll just call it, policy uncertainty, as we all know about, that's led to basically a freezing up of a lot of customer activity on the equipment side. As we hopefully move past that with the new MFN agreements and then really kind of to the crux of the question as we think about the possibility of reshoring leading to orders, again, correct me if I'm wrong, but maybe in '26 with revenue in '27 seems like the right way to think about it based on what we know now. You still get to participate in that even though you've been more resilient in a tough period...

Absolutely. Absolutely. I think a couple of dynamics. I mean, our downstream filtration systems are still in a place where we can take share, right, through the innovation we have, the differentiation, even connecting it to analytics. We now couple our in-line PAT technology within those systems as well. So we -- at least 1 in 4 get that as a part of that system. So there's a real differentiation there.

So we've got just the underlying strength and momentum on that product set. But then beyond that, I think to your point, in the grand scheme of things, we haven't been around that long, right, as the company and the product portfolio that we have today. So when many of these originator drugs came out, we weren't there, right? So now...

Weren't in the game.

We weren't in the game. So now flash forward to where we are today, if you've got now new capacity being built through onshoring or other, you've got biosimilars, you've got next-gen originating drugs that are being developed, we now have a seat at the table. And again, that timing, coupled with what the team has done on our key account strategy that we've talked about, just being able to have more robust partnerships with key pharma, key CDMOs, bringing a larger portfolio.

And now as -- again, to link it to the onshoring, now as those RFPs or discussions come up, we believe that we'll have a rightful place at the table to be able to compete, right, and through the RFP process and through that sort of next-gen process. And so we do think it will be a tailwind for us. We also believe another, I'll say, advantage we bring is that we can deliver almost all of our portfolio from U.S. production sites as well. So of course, that couples well with the concept of the onshoring. So we believe we're well positioned to participate in a strong way.

And maybe to state the obvious, but to the extent that reshoring is really reshoring where you're actually moving production that would have been done in a less expensive environment than the United States, some of the efficiencies you bring to the table are essentially very important to what you described in terms of gaining share opportunities.

Absolutely. I mean that's the commonality, I think, across our portfolio is the idea of providing efficiencies, either it's fast or higher yields or other cost savings measures, again, helps the onshoring to be more competitive. Absolutely.

All right. As long as I'm veering into policy dynamics, why do we close that out. So on, I guess, between MFN and reshoring and I would think the MFN agreements would lead to a more near-term change in behavior. Onshoring is going to take a little bit longer. One, do you agree? And then two, are you seeing a little bit of a change in tone of discussions with customers, as we've got a little bit more certainty out of Washington?

So I think you're right. We'll see some more of the onshoring opportunities probably a little later. I mean you said it earlier, and I'll just kind of confirm that we might expect some 2026 orders and then sales coming later. I think if in '27, if they're greenfield types of expansions, you might see some of that push out.

I think to your point, MFN could happen a little quicker. Again, it's the same thing we just discussed that our products in general will help bring cost reductions and more efficiencies. And that's why, again, we think that we'll have the chance to compete and offer our value proposition, and that's really across the portfolio.

And I think, again, that's what's much different today again versus the past, as we bring a much broader portfolio and can fill more of the workflow. And again, in a way where it's more valuable when you think about an MFN project or an onshoring that we can offer a bigger selection, they're going to want to spend time with us, right? They're just, "Oh, no, hey, we'll get to you later when we want to talk about ATF," right, that's a different discussion that brings us earlier to the table now.