Catherine Schulte: Hey guys, thanks for the questions. Organic growth came in about four points better than what you’ve guided. You talked about China stabilizing, but that sounded like it played out as you expected. So can you just talk through what drove that upside versus your expectations? Was it really broad-based? Or was there a particular product category or end market that’s surprised?
Jim Hippel: Yes. Hi, Catherine, this is Jim. Thanks for the question. Yes. I mean, I think generally speaking, the broad-based market performed as we expected. As you mentioned, China overall those as we expected as well. I think there is – if you look within the Protein Sciences, it gets back to our growth pillars and how resilient they are even in this down cycle we’ve been in. So a two point I’d call out would be one was cell and gene therapy. So we always said that when biotech funding came back, we believe that cell and gene therapy will be one of the first places you’d see it. And I’m not saying there’s a direct correlation there, but definitely a positive sign. And it was a bit of a surprise for us how quickly cell and therapy rebounded for us here in the third quarter.
And again, we saw the same thing over, as Kim mentioned, in Wilson Wolf as well. So that was very encouraging. It was not necessarily in our outlook a quarter ago. The other growth pillar within Protein Sciences was within our instrument, proteomics instrument portfolio and even more specifically, Simple Western. Simple Western performed extremely well and actually grew double digit in instruments as well as consumables. So also a very good sign because we always figured that when the instrument market came back, that would be the first part of our portfolio that we would see it given it’s a broad base of applications. It’s also very used widely in cell and gene therapy, and it’s very the most underpenetrated of our three platforms. So that was not necessarily in our outlook a quarter ago, and it was very nice to see that come back so strong here this quarter.
And then if I turn over to our diagnostics and genomics business, there is, I’d call out the surgeon business. As we talked about the growth rates there, we’re pretty much nearing our EPI test with Exosome. And – so very – one of the highest growth rates we’ve seen with the surgeon since we’ve owned the company and they got some new product launches out there are performing extremely well, and we think that momentum will continue. So that was also very nice to see.
Catherine Schulte: All right, great. Thank you. And then was there any stocking contribution from the European Fisher deal in the quarter? Or will there be any in the fiscal fourth quarter just given the timing of when you signed – just curious if there’s any stocking related to that partnership.
Kim Kelderman: Catherine, thank you for the question. No, there were no such influences in this past quarter and don’t expect them in the next quarter either, specifically because the setup is that Fisher will bring in the leads, and we will ship directly from our warehouse. So you will not see any of those dynamics, if that makes sense.
Operator: Thank you. Ms. Schulte, please rejoin the queue for more questions. Next question comes from the line of Sung Ji Nam with Scotia Bank. Please go ahead
Sung Ji Nam: Hi, thanks for taking the question and congratulations on the quarter. Maybe just on the academic end market perspective at this juncture. Just kind of curious, if you guys have visibility into that market, especially in the U.S. and Europe. Obviously, you’re seeing continued stable growth there, but potentially more difficult comps ahead. So just kind of curious what your outlook might be for the coming quarters.
Kim Kelderman: Yes. I think that academic markets have – we’ve done pretty well in there. And overall, I must say we see a relatively stable environment, right, with the Horizon funding in Europe as well as in the U.S. So it’s a stable market. Of course, with the lull in the biotech industry, some of our innovative sales reps have found their way into some of the academic accounts as well and have started refocusing there. So there is a nice bump up for us by just having the right focus and the connections further developing between the customers in academic as well as the sales rep. So at the end of the day, I think this is not a something that is just for one quarter or two quarters. I think as long as the academic funding stays as it is or gets better, we will continue to see a benefit from that end market, and we will continue to be good or even better at serving it. So – and that’s what I expect for the coming quarters.
Sung Ji Nam: Got it. And then I also have a follow-up on Lunaphore and spatial bio. Just kind of curious, it may be early, but are you seeing competitive wins on Lunaphore currently? And just for the spatial bio addressable market in general, just kind of curious what’s driving the – other than your performance there, just from an end market standpoint, are there a disproportional funding going towards your addressable market, current environment, do you think? Or – just kind of any color would be great. Thank you.
Kim Kelderman: Yes. Thanks for your question around spatial biology end markets. I do believe that end market is under less pressure than other end markets. It’s just such an important tool into determining which biomarker you’re going after. It’s just a new way of doing your research and validating your results. So it’s here to stay, and that market will continue to grow significantly, and we believe that it will grow double digits for the foreseeable future. Yes, we see competitive wins, as I mentioned earlier, when Dan asked the question, there are tremendous benefits from a Comet automation system over other systems that are in the market are reagents, their antibodies are also in the lead and very unique in that market.
So that combination is just very strong. And if I look at some of the trends in the market, yes, we have been able to sell Comets into accounts that have experience with other systems. But an even stronger signal is the moment we found that customers want a second Comet, right? And then now we have several larger pharma companies that have ordered the third one. So that means it’s not only a good value proposition at the moment you buy it, but it’s still a really good value proposition the moment you use it, and that gives them real first-hand experience, and that gives me confidence that, that workflow is indeed a real strong value position compared to the other solutions in the market.
Operator: Thank you. Ms. Ji Nam [ph], please rejoin the queue for more questions. Next question comes from the line of Paul Knight with KeyBanc Capital Markets. Please go ahead
Paul Knight: Hi, yes Kim, thanks for the time and Jim as well. The Protein Simple business, could you kind of highlight one of the fastest-growing portions of the product line. How large is Protein Simple now as well? And just a refresh there would be great.
Jim Hippel: Yes. Paul, this is Jim. So thanks for the question. Good to hear from you. Not given the size of so much on the by product line anymore. We try to avoid that from a competitive perspective. But as I highlighted in earlier – as an answer to earlier question, I think the Simple Western platform specifically was a highlight of that portfolio this quarter with double-digit growth overall and double-digit growth in both instrument placements as well as consumables. That being said, our entire instrument portfolio has been very resilient through this downturn. Despite struggles with the instrument placements the last several quarters, the consumables on all three platforms continue to offset that to keep those product lines in a very stable state overall.
So we’re very pleased with how those – our instrument portfolio has performed and gives us that kind of great confidence that when the market normal, as no [ph] markets normalize, we’ll see accelerated growth in that portfolio once again.
Paul Knight: And then you mentioned in the past potential revenue, the GMP facility or maybe expressed as capacity and dollar revenue. Where are you – where is your thinking now on capacity of your GMP business?
Jim Hippel: Capacity is not – yes, capacity is no longer an issue. We’re probably stop talking about it because I think we have capacity could last as a decade or more, to be honest with you at least as it pertains to our GMP proteins for the CAR-T for the immunotherapy market. We still have some capacity that we need to build out for our regenerative medicine side of our – the GMP protein business. But as it pertains to what that facility was specifically built for, which is the immunotherapy side of cell therapy market. Capacity will not be an issue for a decade or more to come.
Operator: Thank you. Ladies and gentlemen, we have reached the end of question-and-answer session. I would now like to turn the floor over to Kim Kelderman for closing comments.
Kim Kelderman: Yes. Thank you, and thank you, everybody, for joining the call today and for the insightful questions. I’m extremely proud of the Bio-Techne team’s accomplishments in this dynamic environment, and I’m also proud of the results we’ve been able to deliver in this quarter. Our differentiated portfolio addresses some of the highest growth markets in life sciences and is positioned to deliver best-in-class performance, for all our stakeholders going forward. Thank you very much for joining the call.
Operator: Thank you. This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.
