So, just given that delay between initial announcement and actually seeing the benefit, in your view, could we potentially see the benefit this year or could this ultimately be a 2025 dynamic?
Marc Casper: So, Rachel, thanks for the question. I share the enthusiasm about the government’s efforts to stimulate the economy, get things going. So, it’s an interesting time in that respect. So…
Stephen Williamson: [indiscernible] back to Mike’s comment about the view on is this a start, de-start, post-start, I think it’s a good thing that China is trying to find ways to stimulate the economy. And I think this is one element of it and we look forward to other things happening as well in terms of the way that China is managing the economy. Marc, all right, go ahead.
Marc Casper: Yeah. So when I think about actually the way things play out and a lot of this is about signaling as far as I can tell from my own experience, I worked in China for many years. It’s a multiyear program as opposed to the last one, which was shorter term. So, basically, the government is signaling at least to the economy that they’re looking for investments in instrumentation equipment, technological advances, advanced research. So, that’s very encouraging in terms of that it’s not a short-term program, but rather longer term. And yes, we’ve already have proposals in front of customers. And yes, there’s quite a bit of dialogue. Customers are actually waiting for some of the very practical details of how this will work because it varies by province ultimately.
So to my knowledge, no orders yet. I wouldn’t expect any of that quickly anyway, but lots of activity. And the way that I would think about this is there’s the direct effect and then the indirect effect. I would expect that we would see orders really later in the year and some revenue late in the year directly associated with the stimulus, but that may miss by a few months one way or the other. So, I wouldn’t expect material shipments in Q2 around us. It would be the way I would think about my experience. The indirect effect is a confidence booster, right, which is basically saying the government is going to try to get the economy up and going and that should help more broadly and that doesn’t help tomorrow, but it helps from a contextual standpoint of business confidence.
So, I think those things would say that you’re seeing China try to get the economy growing. We’re not assuming a lot in China in our numbers this year in terms of major changes. So, what I’m most excited about there is that it sets up for ’25, not that we won’t see a benefit this year, but it’s kind of a direction of travel. And our view is this, longer-term China should be a good growth market for us.
Rachel Vatnsdal: Perfect. Really appreciate all that detail. And I just wanted to stick on China for my follow-up then. Obviously, we’ve seen some of these headlines around Biosecure Act. We’ve heard some of your customers talking about trying to derisk some of their supply-chains and go with more Western manufacturers, just given where we’re at from that headline perspective. So, I wanted to see how has that been impacting your customer conversations? And have you seen any increase in inbounds in terms of Patheon? And then just from a timing, if you were to benefit from this, obviously, a pretty capacity-constrained sector right now. I know, you mentioned some of the Catalent-Novo dynamics earlier as well. And could you even benefit in the near term from any competitive wins relating to Biosecure or is it just a function of capacity constraints?
This really alludes to the value chain and the vertical integration that Thermo has, but will be more of a benefit longer term. Thank you.
Marc Casper: So, the way that I think about Biosecure is, I kind of put it into the context of there’s a level of geopolitical tensions that exist around the world, including between the US and China. It’s never exactly clear whether these things become enacted or not. It’s our job to help our customers navigate those shifting landscapes. I think at the highest level, actually relations are falling between the countries a bit. There will always be challenges. When I think about how this could play out, should it play out, I think that what is making the customer base that’s largely Western in terms of where biotech and pharmaceutical activity is largely, just think more about their supply chains, who’s doing development work, et cetera, given our network is effectively 100% in US and Western Europe and that set of capabilities, we’re likely to be a long-term beneficiary, not per se of the Act, but rather the fact that customers are thinking about who are their partners and where should those partners be based.
So, I think that’s a long term, should be okay and I don’t think it has any material impact to the results in the short term. Thank you, Rachel.
Operator: Thank you. The next question is from Dan Brennan with TD Cowen. Your line is open.
Dan Brennan: Great. Thanks for the questions, Marc and Stephen. Maybe just on China, I know some — there’s already been some discussion points here, Marc, but could you just give us a sense, how that — how the low single-digit decline in the quarter kind of compare to expectations? And just remind us what’s assumed for the full year and kind of any color you can share about just demand trends across your business segments in China?
Marc Casper: Yeah. So, when I think about China, that actually played out as we expected. The team delivered on the expectations for the quarter. And as you know, our guidance, we don’t guide by geography or by business. It’s really the aggregate of it all. But actually the first quarter played out as the team expected and they executed well. When you kind of go down into the sub-segments of China, now you’re getting to the tiny portions of our revenue, nothing really significant of note in terms of things better or worse than what we’ve been seeing or what we would expect. So that’s — that would be my high-level view. I’m looking forward to returning to China early and early in the summer. So, get some first-hand perspectives on that as well.
Dan Brennan: Got it. And then maybe just on bioprocessing, I know the consumable portion of your business, Marc, is, call it 10% or so of revenues, but net, there’s obviously tremendous focus there right now. Could you give any color on how that business performed in the quarter? And any color you can provide on like, this ongoing destock issue, whether or not you’ve seen orders start to grow again sequentially? Thanks.
