So very targeted investments that will kind of be offset that growth by some of the costs coming out of corporate and allocated due to stranded. So as we think about the run rate of corporate unallocated, that $66 million should still hold true, so it’s roughly around 2.2% of our revenues. So as we think longer term, in addition to the $25 million that we’re taking out, which is more of a short-term cost to take out of the stranded, we feel there’s also some other opportunities to take out additional costs within the corporate unallocated as we go forward and then obviously look to see the company through organic growth as well as acquisition growth. As we grow as a company, we’ll be able to leverage the infrastructure and the cost structure we have there even more.
A.J. Rice: Okay. Thanks a lot.
Operator: Thank you. [Operator Instructions] Our next question comes from the line of Eric Coldwell with Baird. Your line is now open.
Adam Schechter: Eric, good morning.
Eric Coldwell: Hey good morning. First, if you don’t mind, I’m going to ask two. On the $25 million cost action, the incremental does that represent – what portion of the stranded cost does that represent? I assume it’s not the full amount, but could you tell us how that stacks up compared to the total?
Adam Schechter: Yes. There’s about $45 million of stranded cost, give or take a couple of million. And we’re going to – we have a path forward, and we’ve identified the $25 million of that.
Eric Coldwell: Okay. Perfect. And then my first question was really going back to the NHP. Surprising to hear you say you don’t expect a headwind or have no issues there in the back half. I’m curious how that is? Is it due to new supply access that you’ve been able to get your hands on? Is it pricing? Has something changed in the market that’s allowing you to work around the obvious Cambodian issue? Just curious more on the mechanics of how you do not see a headwind from NHPs in the back half?
Adam Schechter: Yes, Eric. First thing I’d say is as we look at the studies that we have for the back half, we already have the NHPs that we need to support the studies. When we first realized this issue, we immediately began to look for alternative suppliers to ensure that we would have capacity. The reason it took us through the first half of this year is because even when you receive the NHPs, there’s an acclimation period before you can utilize them in study. So we’ve worked through that and based upon what we have today, we feel confident in NHP trials going through the second half of the year, which is why at the midpoint of the guidance, we feel comfortable of 9.5% for the Biopharma Laboratory business.
Eric Coldwell: Is there a – Adam, is there a pricing component on top of that, that would be incremental year-over-year that perhaps the volume is not quite equivalent to last year, but with additional pricing you’re getting to, you’re able to not have- a year-over-year headwind?
Adam Schechter: Yes. So what I would say is it is more costly today for NHPs than it was in the past. Much of that cost can be passed on to the customer. With that said, however, the margin on that cost is not able to be passed along. So it does impact margin a bit, but it doesn’t impact us negatively. We can pass upon the increased cost.
Eric Coldwell: Okay. Thank you very much.
Adam Schechter: Yes. Thank you, Eric.
Operator: Thank you. [Operator Instructions] Our next question comes from Brian Tanquilut with Jefferies. Your line is now open.
