Repligen Corporation (NASDAQ:RGEN) Q4 2022 Earnings Call Transcript

Unidentified Analyst: Hi. Good morning. It’s Asaf speaking on behalf of Justin. Just two quick questions. So firstly, you mentioned cell and gene therapy business growing significantly in ’22, a little slowdown as well and also a 25% step-up in gene therapy during Q4. Which indications in cell and gene therapy are you gaining traction in? And as you look at 2023 and 2024, how are you thinking about the growth rates in these modalities?

Tony Hunt: Yes. So I think when I made the comment — my comments on pharma in Q4, clearly that was also impacting in gene therapy in a very positive way. The challenge, as I said, is that half our cell and gene therapy business coming from CDMOs. And while we definitely saw pickup in Q4, it needs to continue to increase as we go through the next few quarters. So while we’re calling 15% to 20% for cell and gene therapy, overall market growth could actually be higher than that. But that’s just because we have a lot of customers sitting on inventory, right? So they’re using the products and they’re developing products and getting them through Phase 1, Phase 2. I think long term, cell and gene therapy with mRNA all bundled in is probably going to be growing 20% to 30% on average in the out years. But this is just a unique year because of destocking at the CDMO level.

Unidentified Analyst: Thank you so much for the color. I appreciate it. And just lastly, which areas of material cost inflation were greater than anticipated? And does the guide contemplate at these levels in 2023 or is there like some release at some point in the year?

Jon Snodgres: Yes, it’s areas like plastics and stainless steel and a lot of those types of areas where we see the significant inflation. Our guidance contemplates what we believe is going to be the inflation for the ’23 period, yes.

Unidentified Analyst: All right. Thank you so much.

Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Mr. Tony Hunt for any closing remarks. Please go ahead, sir.

Tony Hunt: Great. Thank you, everybody. I appreciate everybody joining today. Obviously, we’ve covered a lot. Obviously, the 2022 stellar year. We got some headwinds as we move through the first half of this year, but I think we’re very optimistic about the second half of the year and overall and look forward to getting back on the call in a couple of months and bringing you up to speed on where we are in Q1. So thanks everybody for joining.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.