Full Year 2021 ICON PLC Earnings Call
More because of the somewhat extraordinary.
All the new business.
No Dan I can't to be honest with you we don't we don't track to that level.
What I can speak to as to the biotech segment as a whole for US we have the.
We have that that's the 75 and below in terms of prescription sales.
It was extremely strong.
In Q4 quarter to quarter year on year and across the year.
About approximately half of those are those very small III revenues.
My assumption is that that was also strong but I don't have that specific number.
Wins basis available overall, the biotech market.
It was very strong and continues to be strong.
And Steve I heard your comments around no issues or concerns on cash collections are rising bad debt with that small biotech group, but folks I speak with are more concerned with that.
They'll meter out the cash they have differently in the current environment, they're not concerned they don't have cash it could get metered out differently. So I don't know if theres anything you can speak to on that front.
Not quite sure I understand the question I think it's I think it's maybe a slowdown in just what theyre going to do with the cash I mean, I think that one of the big pieces. Here is obviously development is still crucial to this organization. So I don't know that theyre going to start pulling back on that particular element of spend.
In their overall working on their on their balance sheet and indeed, when you look at people who are looking to get capital funding it because they want to make sure that they continue their development process. So we certainly don't see them looking at our cash balances in a different way other than to continue to fund our development option.
I appreciate the thoughts thank you.
Thank you. The next question comes from the line of you got from Barclays. Please ask your question.
Clarify it for me so again on the midterm targets you have high singles and.
The DAC and Thats, what you said at the J P M and time of PRA deal.
But then Steve you just said.
Said mid singles to high singles I, just wanted to make sure that your are you walking that back or is the mid to high really what youre talking about for 'twenty, two but then beyond that youre looking for high singles.
We're talking about mid to high for 'twenty, two and ongoing from the.
Luke.
Okay, so mid to high ongoing through.
Going forward, Okay alright.
Alright.
Alright.
And then the other clarification here is on the the RFP volume.
You said it was up mid singles the Smid biotech segment was up mid singles at the JP Morgan Conference and then.
Youre talking about being up low double so just trying to get the the difference there and what you guys are seeing.
Well it was in.
Overall.
High single I suppose from a overall RFP low low doubles within that sort of range.
<unk> 10 or so.
It was a bit higher in the in the biotech space.
A little lower in the large pharma space. So overall it was it was in that high singles low doubles range.
As things are.
Can.
We don't get too.
Focusing on one particular quarter overall, the year was up it was up nicely.
And that in that double digit low double digit range.
On a quarter to quarter year on year basis.
Low double digit low double digits and that's what we saw in the Rfps.
We feel the markets moving in the right direction, probably biotech area continues to be strong.
And that was a little bit higher in the biotech and a little bit low in the large pharma that's out played out.
Alright, great.
And then just real quick if I can squeeze one in here more long term so you've talked about the new indications and demand for that RFP like kind of filling the funnel here.
Are you seeing the return to the pre COVID-19 levels, where youre seeing monoclonal antibodies and like Adcs really taken the lion's share of those rfps or are we seeing the new market for cell and gene therapy, and mrna really starting to take off and starting to feel that that RFP and backlog funnel.
Oh, yes.
I think it's a little early to sort of make that call look to be honest.
Leasing.
Activity in the cell and gene therapy area, we're starting to see more activity in the mrna and RF area.
Area for that matter and drug conjugates, so those sorts of rare diseases also.
That's coming that's coming through is it is it a title wave no, but we're certainly seeing some moves in that direction around as I said, the science and the.
The technology, that's really becoming available whether it be out of the.
The pandemic.
In other areas so.
I would say, we're certainly seeing a move towards it.
I would hesitate to call it.
The tsunami of opportunity, but certainly a nice tailwind if you like with this new sort of new sort of <unk>.
Science, that's being applied to new just particularly in the.
In the biotech and small pharma space.
Great really appreciate the color. Thank you as always.
Yes.
Thank you. The next question comes from the line of Derik de Bruin from Bank of America. Please ask your question.
Great. Thank you for taking my question.
Two quick ones.
What's embedded in terms of your thoughts on M&A.
A lot of your competitors include some capital deployment into their topline growth I mean, yeah.
It looks like more like Youre talking about on an organic basis, and then I've got a follow up.
Yeah. So let me let me check.
I think as we've been pretty specific Derek.
Priority for capital deployment is on paying down the debt.
The short term, but we're making such good progress on that but we are and we will particularly as we get to the back end of this year to start to think about what other opportunities. There are in the M&A space. So there's a number of areas we feel we could.
Potentially.
And the more I suppose more medium term.
Next sort of 12 to 18 months.
Look at.
Some of the technology.
Home health the whole decentralized trial area patient recruitment labs, there are some areas that we feel we could we could.
Could potentially invest in further and build.
From a liquidity point of view.
I would emphasize that we want to get to that two five times.
As a focus so that's the plan as we get into next year.
So that's very much the priorities.
Great and just one follow up.
Obviously, China has been in the news lately some questions from the FDA on some of the clinical trials being run there.
I thought your comments on diversity or interesting in sort of that increasing how do you sort of see this opportunity with potentially some of the.
Concerns or questions on the China based trials and how does that sort of factor into your outlook can you just talk about your over your China exposure in particular areas whereby it gives us an opportunity for us.
Help us gain a little bit more business there. Thank you.
So it's funny you asked about China, I thought I thought you would be asking about the Ukraine and Russia, given the current situation.
Yes.
But so let me let me address let me, let me just kind of Ukraine, and Russia. We do we have resources that we have offices, there it's less than 2% of our population.
A lot of any fees.
The operations are continuing site visits are continuing.
The recent very recent developments have an impacted that at all and we're obviously hopeful that that continues it's a fluid situation but.
Our operations are in good place there and we feel like we can continue to monitor our trials, but we are we have less than 2% of our questions in terms of China, China remains of.
Market force and important focus for us both from a local more functional point of view and from a deliver full service trials.
There have been some challenges and they continue to be some challenges with the FDA in China.
It is a situation that we.
Constantly need to be vigilant in terms of what they were expecting and what we need to be delivering for them.
We have a strong organization now that they are now we have over 1000 people.
In China now as it can.
Combined organizations, we have many hundreds of sites and how you make a major contribution to our full service work bid in the biotech small.
Pharma market or more of our large pharma or as I say on a functional basis, you have a big operation.
It's one we take a lot of interest and we monitor very carefully the regulatory.
Requests out there and our relations with the regulators out there to make sure that we're doing the right thing by them.
But.
It's one of the more challenging environment that we work within I'll just leave it at that.
And so as I say it remains a key area for us, particularly in terms of long term growth. We see a number of companies out there that are that have ambitions to to move east to develop drugs in the east and we're starting to engage with those sort of companies more so perhaps and then some of the companies who just wanted to do work in China.
So there is an increasing opportunity out there and I think over the next.
Five to 10 years, it will be an increasingly important part of our business.
Thank you.
Thank you. Thank you participants for your questions I would like to hand, the conference over to our speakers for closing remarks.
Thanks, operator, thank you for listening in today, we are pleased to have delivered a record quarter in the year as the new iPhone and are proud of the support provided to our customers and the development of life saving drugs and devices I wanted to take another opportunity to recognize our entire workforce for their unwavering commitment and efforts over the past quarter and in <unk>.
21, Thank you all and have a great day.
That does conclude our conference for today. Thank you for participating you may all disconnect have a nice day.
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Good day, ladies and gentlemen, thank you for joining us on this call covering the quarter and full year ended December 31, two.
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B J, ladies and gentlemen, thank you for joining us on this call covering the quarter and full year ended December 31st 2021 also on the call today, we have our C E O Doctor, Steve Cutler and our C. F O. Mr. Brendan Brendan I would like to note that this called webcast not their slides available to download on our website to accompany.
[noise] today's call.
Certain statements in today's call will be forward looking statements.
[music].
[music].
Good day, ladies and gentlemen, thank you for joining us on this call covering the quarter and full year ended December 31st 2021 also on the call today, we have our C E O Doctor, Steve Cutler and our C. F O. Mr. Brendan Brendan I would like to note that this called web cast and that there are slides available to download on our website to accompany.
[noise] today's call.
Certain statements in today's call will be forward looking statements. These statements are based on management's current expectations and information currently available, including current economic and industry conditions. Actual results may differ materially from those stated or implied by forward looking statements due to risks and uncertainties associated with the company.
And listeners are cautioned that forward looking statements are not guarantee the future performance.