Becton, Dickinson and Company (NYSE:BDX) Q1 2023 Earnings Call Transcript

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And I think if you think about the installed base that we’ve grown on BD MAX, the fact that we’ve released these combination assays on both BD MAX, BD Veritor, BD COR actually now in Europe is CE-marked. I think that dynamic, and we can talk about it later, the dynamic of what that looks like for the full year on the respiratory testing obviously continues to play out. But yes, COVID only, we definitely see a decline.

Vijay Kumar: Sorry, did the prior guidance on that, I think you mentioned 150-ish for the year. Did that change?

Dave Hickey: Yes. So for the year, we think COVID only now will be in the range of $50 million to $100 million.

Vijay Kumar: Sorry, on the combo test. I think flu combo…

Dave Hickey: So, yes. So, we never really €“ so, if I think about that, the way €“ if you think about what we said from a, let’s say, a flu season pre-pandemic, we had said that was always in the $75 million to about $100 million range on the antigen testing and so on and so forth. There is obviously a lot of unknowns right now in terms of how the full year is going to play out. Obviously, quarter one, we saw the season start early, if you track those CDC graphs, we saw the season start early, it peaked, and we were able to respond to that. If we were looking at it now and for all the assumptions we have, we would think it will be about 1.5 times, let’s say, a normal season. So $75 million to $100 million, we would say 1.5 times. And that’s really enabled and driven by the installed base increases that we have and the fact that we have developed to launch these combination sets across those platforms.

Operator: Okay, we’ll take our next question from Matt Taylor with Jefferies. Please go ahead.

Matt Taylor: Hi, thanks for taking the question. Sorry for the delay there. So, congrats on quarter, even though I’m not a €“ usually congrats on a good quarter guy, but that was very nice. So…

Tom Polen: We appreciate that, Matt. Thank you.

Matt Taylor: Of course, Tom. I had a question, a follow-up on Chris’ comments on just the operating margin expansion improvement being more back-half weighted. I was hoping you could just talk a little bit more about that and maybe unpack that and talk about the sources of it just because there’s been so many moving parts and it’s an important part of the story.

Chris DelOrefice: Yes. No problem. Thanks, Matt. I appreciate the question. Yes, things are pretty consistent with what we shared when we started the year, and it seems to be playing out as such. Some of the key factors to contemplate. First of all, we talked about that from a full year standpoint, inflationary headwinds being another 200-plus basis points. This is on the back of two other years with last year also being over 200 basis points. So, we’ve been navigating an extremely challenging macro environment, right, when you think of that on a cumulative basis. What we did say around the inflationary pressures, it would be significantly weighted towards the first half of the year will be highlighted in Q1 that you saw flow through because a lot of this was inventory that was built last year that sold through.

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