Veeva Systems Inc. (NYSE:VEEV) Q4 2022 Earnings Call Transcript

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Ryan MacDonald: Thanks for color on that. I appreciate it. And maybe a follow-up for Brent. Obviously, with the expectation of sales and prescriber data coming into plan being generally available later this year, as that data set builds and as you build sort of the book of business for those data sets, will you see any gross margin pressure initially with the inclusion of those data sets while you’re sort of in the early stages of monetizing it? Thanks.

Peter Gassner: Yes, I can take that one. No, we don’t see extra gross margin there from those products. We’re always looking for data that we can add into the Crossix platform, but that data is really shared, patient data is the root of it. And then we do — we transpose it, we do projections to get to the prescriber. So we’ll add data incrementally, but I don’t — there won’t be any large change when we get to the subscriber product.

Ryan MacDonald: Thanks for taking the questions.

Peter Gassner: Thank you.

Operator: Next up is Joe Goodwin, JMP.

Joe Goodwin: Great. Thank you for taking my questions. Great to see that quality, the quality, small quality suite is still moving forward well. I guess can you just elaborate on the Vault LIMS product that you’re all working on and it’s important to your position in the quality market?

Peter Gassner: Right, you got about 30 minutes because I love that product. Here we go. All right. LIMS is interesting. It is for testing materials, largely pharmaceutical companies, biotech make materials in batches. They’re not making units or making batches, batches of things that then would be packaged. And serious things that are either injected or intravenous into the human body. So the quality of them is super important for obvious reasons. LIMS is Laboratory Information Management System, what we call QC or quality control LIMS. That’s where you keep the specifications of how you should test this medicine along the way of its life cycle. During its multi-day, could be week’s process of making this medicine in the batch, what test should be done, and there’s a whole variety of tests, some as simple as what’s the color in the PH to some very sophisticated tests.

Those specifications have to be designed and approved in the system and then data is entered in either through APIs or through manual. And that’s the quality control process. That’s a big part of the quality control process that then is used to see, hey, can we release this medicine in this market to be ingested or injected into humans. Very important area and we’re going to build it inside of our quality Vault, which means it will become unified with our QMS system, our QualityDocs system and our training system. Nobody has ever done anything like that before. And I think it’s going to be a real transformation in the quality control processes in life sciences, which will allow people to release their medicines faster, which is a real — keeps the company much more agile.

So this is very much top of mind in the supply chain area of our customer supply chain and manufacturing. It’s a big product. It’ll be one of our biggest ticket items in the quality suite. It’s definitely not an add-on product to QMS or something like that.

Joe Goodwin: Got it. Thank you.

Operator: Our next question is Stan Berenshteyn, Wells Fargo Securities.

Stan Berenshteyn: Hi, thanks for taking my questions. On CRM migration, so when customers begin migrations, do you anticipate that in the year in which these migrations take place, that there may perhaps be some impact on new product uptake from those clients until perhaps the migrations are completed?

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