Q3 2022 Cryoport Inc Earnings Call

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Please standby we're about to begin.

Good afternoon, and welcome to Cryo ports third quarter 2022 earnings conference call. All participants will start in a listen only mode. As a reminder, this call is being recorded I would now like to turn the call over to your host Todd Fromer from case yesterday.

T J communications. Please go ahead.

Thank you operator before we begin today I would like to remind everyone that this conference call contains certain forward looking statements all statements that address our operating performance events or developments that we expect or anticipate occurring in the future are forward looking statements. These forward looking statements are based on management's beliefs and assumptions and not on information.

Currently available to our management team.

Management team believes that these forward looking statements are reasonable as and when made however, you should not place undue reliance on any such forward looking statements because such statements speak only as of the date when made we do not undertake any obligation to publicly update or revise any forward looking statements, whether as a result of new information or future events or otherwise except as.

As required by law. In addition forward looking statements are subject to certain risks and uncertainties that could cause actual results events and developments to differ materially from our historical experience and our present expectations or projections. These risks and uncertainties include but are not limited to those described in item one a risk factor.

And elsewhere in our annual report on Form 10-K filed with the Securities and Exchange Commission and those described from time to time in other reports, which we file with the Securities and Exchange Commission.

Now my pleasure to turn the call over to Mr. Jerrell, Shelton, Chief Executive officer of cloud.

Jerry the floor is yours.

Thank you Todd good afternoon, ladies and gentlemen, we appreciate your joining our earnings call today with this afternoon is our Chief Financial Officer, Robert <unk>, Our Chief Scientific Officer, Dr. Mark Sawicki, and our Vice President of corporate development and Investor Relations Thomas Heinzen.

As a reminder, we have uploaded our third quarter in review document to our website.

It can be found under Investor relations in the events and presentations section.

The document for this document provides a review of our recent financial and operational performance and a general business outlook. If you have not had a chance to read it I would encourage you to go to the website and download it.

I will provide a brief update on the business and then we will move onto your answer your questions.

Last quarter I'll begin the call with reflecting strong demand across all business units and geographies, we delivered another solid quarter with second quarter revenue, increasing 14% or 18% on a constant currency basis.

Unfortunately, this quarter I must report that like many companies that operate globally, we experienced the convergence of macroeconomic pressures that impacted our third quarter revenue.

They were wide ranging and abrupt and their impact.

For the third quarter, we are reporting total revenue of $60 5 million and.

An increase of 7% compared to $56 7 million for the third quarter of 2021.

With all of the aforementioned factors in mind.

Reevaluated our guidance our guidance for the full year 2022 is now right in the range of 232 million to $238 million with a decrease of approximately.

10% from previous guidance. We also are reevaluating, our aspirational goal of $650 million to $750 million in total revenue.

End of 2000.

25, given all of the exchanges.

All of the changes that have occurred since we provided you that goal.

We reached these conclusions after deliberate consideration.

The potential impact.

Pressures on MBE biological solutions and PDP as these business units have greater international exposure than crop port systems are crowding.

Short term issues aside the one thing we know is that we have a solid company that is healthy with $350 million of cash and man.

I'm, sorry, $530 million of cash and manned by highly motivated people, who believe in our mission to serve our target markets, which are dynamic growing in nascent.

Despite these headwinds impacting our second half of 2022 performance, we remain positive given the outlook of our target markets and we are working diligently to further advance our leadership position in the essential supply chain platform companies, serving our life Sciences market.

<unk> has never been stronger and never had so many business development initiatives underway, the foregoing initiatives and the others that have been publicly disclosed.

We are focused on further strengthening our business and positioning us in the dynamic and growing markets. We serve the commitment of our team is resolute in its commitment to deliver solutions that support lifesize.

Lifesaving cell and gene therapy is second to none our markets remain solid and we expect <unk> to continue to grow and prosper. Despite any short term headwinds we remain confident in <unk> long term growth prospects and our ability to increase shareholder value through good times and bad.

As a team we will continue to move forward, we will not accept excuses for any internal or external issues that affect our performance, we will make the necessary near term strategic adjustments that are needed to weather These times and come out a much stronger much more efficient organization because of our.

Efforts are our attitudes asprey actions team work and dedication our ultimate importance and we will see us through any short term obstacles as we continued to position ourselves to take advantage of opportunities in 2023 and for the long term growth.

Now we will be happy to open the lines for any questions you may have operator.

Of course, thank you and if you would like to ask a question. Please signal by pressing star one on your telephone keypad, if you're using a speaker phone. Please make sure. Your mute function is turned off to lay a signal to reach our equipment.

Again, it is star one if you would like to ask a question.

And we will go ahead and take our first question from Puneet <unk> with SBB Security. Please go ahead.

Yeah.

Hi, you have Michael on for Puneet, Thanks for taking my question.

Start with and I was wondering if you could quantify the impact of the China shutdown and also how you see.

The growth looking into the future I know before you talked about a mid teen type growth I wonder what youre contemplating now.

Well im going to answer part of the question and then turn it to our CFO Robert Nevada.

But.

Long term <unk> solid its a solid company and is a solid market.

There is some variability.

Order to quarter and so of course.

They're created creates a variation if I look at the long term history of MBE. There is various slides cyclicality. There is very slight seasonality. So right leads me to is it leaves us to the conclusion that.

That there is a there is a concern about by our customers. There is a concern about the <unk>.

Market conditions in the.

And the uncertainty in the economy.

I think that short term will be short term lift and then for specifically for the financial impact I'll turn it to Robert Yes, maybe just a couple of comments on <unk>. So if you look at <unk>, our product revenue really which is comprised by MBE, Yeah, we had a 5% year over year growth.

For for that business and about 9% on constant currency, but we have identified and that did lead us to bring down the revenue guidance for the full year by 10% identified specific impact on the MDA business.

And there are really a couple of items that really drove that.

One because of the increased economic uncertainties and the disruption in the capital markets. We believe that that has curtailed some of the capital expenditures by <unk> customers for the larger cryogenic systems and freezers towards smaller units and for the second half of the year.

That probably had expected impacts about $15 million for 2020 to second half.

The second component is related to the the reoccurring shutdowns in China. It actually at this time for the first time impacted our Chengdu manufacturing facility for MBE.

And so the impact for that for the second half in total is expected to be about $2 5 million.

<unk> for 2022, so we're specifically looking at the impact on Q3, and Q4 of 2022 and not beyond we will provide additional guidance on that when we report out our full year results.

Got it. Thank you and then my next question.

Do with clinical trials I see none.

<unk> cloud continued to grow I was wondering if.

With biopharma being more cautious with their capital spending at the pipeline, if youre seeing anything predict future pipeline any impacts there and we also heard from another tool company about delays in selling gene therapy enrollment I'm wondering if that's something you have any visibility on.

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Okay or anything.

Hello, Please standby.

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Miami call Hello.

Again, please standby.

Hello can you hear me.

Okay.

Scott I can hear you.

Okay.

Or even some conference right now.

Yeah.

Okay.

Okay.

We are now live.

Okay.

Yeah, Hi, folks were back Ah, we apologize or our line dropped.

How much of that did you catch.

Maybe just answer Robert.

David can you hear anything from you after you have to repeat the answer.

Okay. So it was about clinical trials, Ryan if we're seeing any slowdown or any pausing yeah. So.

I apologize I'll just reiterate here so from a clinical trial standpoint, we still see very very robust activity.

We're up to 643 clinical programs was 80 phase III projects.

Clinical trial activity in the space continues to be very strong and our portfolio of clients have have raised a lot of money into it are very comfortable from a cash position.

And they know they're not slowing down their investment in their clinical portfolios.

At this point in time, we see extremely robust activity again, and just to emphasize on what.

Mark said is you know if you look at the corporate systems revenue.

If you look at overall growth year over year, its 25.4% clinical.

Clinical trial revenue is in excess of 26% commercial revenue in excess of 23%.

So the the core business of crowd persistence is very strong and as a reminder, no total revenue 80% of that is related to Biopharma farmer and a big portion of that is related to the celgene in our market.

Got it thank you very much.

Great. Thanks, guys.

And we will go ahead and move on to our next question from John Zaro Beer with UBS. Please go ahead.

Hi, Thanks for taking my question I was wondering if you could run through some of the other assumptions in the guidance, maybe the FX outlook for the fourth quarter and just any additional color you could provide on some of the shifts that you're seeing from.

From customers there to the smaller distributors.

Yes, maybe just the I can add a few a few comments to it as I mentioned earlier.

A portion of what we see in the second half and it started Q3, we expect that to move into Q4 as well is that change in customer spending that we think is driven by the current uncertainties in the market and the economy.

And so that does certainly an impact MBS freeze our business.

And we eventually about 15 million for the second half if you look at Europe , and which is really driven in large part by the Russian invasion of Ukraine, We haven't one seeing an impact on the general logistics volume are really mostly for non cell and gene therapy trials.

Which heavily rely on the eastern European enrollment as well as delays in new studies and the Onboarding of new clients, primarily for our cryo PDP business impact there is expected to be about $3 5 million for the second half of the year.

Yeah, I mentioned, a load of the APAC region of the Covid shutdowns in China, one the impact on M. B, He's manufacturing plant and in Chengdu, China that.

Was shut down for 42 weeks in <unk> was more than the two week shutdown alone as well as you know again, some one of a slowdown for cloud Pdp's business in the APAC region related to specific trade lanes. There. So that's you know some of the main pieces and then obviously like many companies we are impacted by a V neck.

Foreign exchange rates, and we have about 37% of our revenue and in foreign currencies.

We have about $2 6 million impact or four 4% on revenue for the third quarter and we expect to be in the round 3 million for the fourth quarter of this year.

Thanks, and I guess, the you know the relationship with Takeda on that that's a 2023 opportunity any way just to frame kind of the revenue opportunity with that relationship there.

Yeah, what we're really just getting that established right now.

There's build out effort that's required.

We're actually extremely excited about that the overall platform because it really does provide an opportunity for standardized <unk> collection and cryo processing and it also pushes out into the community care setting significantly.

And if you look at different studies, a lot of folks are saying that upwards of 80% of the eligible patient population is outback community care setting and do not have access today. So we're quite excited by it but its going to take a little bit of time to to obviously get this established I wouldn't.

Look it.

Too much from a contribution standpoint in the first first quarter or two.

We will have some impact in Q3 and Q4 next year.

We haven't quantified that at this point and maybe just a thing a few things to point out for you. When you look at that relationship and the business initiative.

Specifically looking at the clinical trials incorporate system support.

We mentioned there is about 30% of those trials are 190, Troy clinical trials that are allogeneic therapies.

And that's where we see of a huge need for for this initiative.

And and obviously, we will see if there's a need for autologous therapies as well, but the need for the allogeneic is going to be even more significant.

Is that it creates more opportunity we haven't stopped.

Our intensive effort towards looking at appropriate acquisition.

Candidates and so we will continue that.

Fortunately have $530 million of cash on our balance sheet, we're in a good position to weather.

Whether this upcoming recession and.

So we continue.

We have a robust pipeline and we continue to sort through it.

Thanks, and maybe picking up on that last point on kind of impending recession choppy macro out there Robert you kind of talk about any.

Actions, you are taking or levers you have to help protect the P&L if we had it.

You've been choppy at times ahead. Thanks.

Well, we're certainly prudent in terms of how we utilize our capital I'm, having said that I want to really redirect to the cell and gene therapy space. We obviously have a lot of transparency in terms of where our customers are going what the expected BLA and MAA filings are if you look at the number of clinical trial.

We're supporting the <unk> phase III trials that we're supporting Theres going to be a significant demand for <unk> <unk> solutions and so that's really the main driver for a lot of the business initiatives that we have for some of the innovation that we have in terms of new technology software and shippers.

And we will continue to invest in these programs because it's really going to be driving significant revenue for <unk>. So so yes, we will be Purdue prudent in terms of how we apply our cash we as Jerry mentioned, we have a very strong balance sheet, we want to maintain that strong balance sheet, but we also want to leverage the opportunity that lies ahead of us.

<unk>.

Super brands, if we could just.

Brandon we could add to that a little bit too we have a lot of initiatives that we've been working on we've reported in.

Previous calls.

And there'll be coming and they'll be coming to fruition.

By the end of this year in the first quarter of next year once the crowd portal Tufano logistics management system.

That's an upgrade of the software that you've seen and that gives us an edge on on the rest of the rest of the world on any competition and is complemented by contracts, which is a revolutionary.

Radio that.

As a condition monitoring system collecting extensive data that comp that is fed back into cloud portal to point out.

And then the third thing is cryo sphere, Crossrail is going through its final validation and as soon as that is completed it will be announced in the market and we expect a nice uptake on crowd sphere.

Then we have two new models of <unk> and fusion at MGE. These are these are varrio is a.

Variable rate freezer in other words, you can dial that freezer up from 196 up to minus 80, giving great flexibility to our customers and then fusion.

As a as a unit that actually does not require.

Liquid nitrogen.

Seeds from tanks in plumbing, and so forth you charge it with liquid nitrogen one time and it continues to operate.

For a long time, we suggest checking it every five years, but.

And then we have another fusion model coming out that will go through single doors and Thats.

That model.

Open up a whole new segment of the market.

Throughout the world, because many laboratories and <unk>.

And Asia, Baccarat, and second and third and fourth floors, and then the United States. Their hospital pharmacies that are going to need this product.

Allergenic products come to market, we have a direct to patient.

Initiatives going on to Cryo PDP and.

In Europe , that's in the Alpha stage, and we expect that to be successful in that play a role in allogeneic delivery as well as well as perhaps I'll targets, but certainly.

And then of course, we have indicated biolife.

Initiative that is just being undertaken is not as mature as the first two or three I mentioned, but that one has huge promise for us.

I can't tell you how excited we are about.

That operation and that gives us the ability to.

For <unk> collection, and Luca pack production, giving the industry pressure better starting material, which they which they are looking for vocera. Firstly and then and then of course, we are rolling out cryo PDP in the U S and.

With cell and gene therapy crowd PDP as you know has been a biopharma operation Thats. The third most important in the world.

And we're moving that to cell and gene therapy, displacing some of the other careers and then of course, we are building out the U S, which is the biggest market in the market that historically crowd PDP has not been strong and it has been developed in here. So we have a lot going on that gives.

With great confidence.

Yeah, Let me just add I mean, we've already put the sweat equity in resource and all of these initiatives.

Over the last couple of years, so we're going to be able to benefit from the outcome of these and the reason that we've made those investments is because the <unk> space continues to accelerate.

I understand obviously, there is a robust pipeline for earlier line indications product expansions.

Another two potential approvals this year and upwards of another 26 filings next year.

Portend, obviously, a tremendous opportunity further for our organization as a whole.

Thank you I appreciate all that color good luck.

Thank you.

I'll move onto our next question from David Larsen with BTG. Please go ahead.

Hi can you. Please remind me how much revenue roughly is coming from and the cryo PDP.

Cryo poor.

Systems, and then also cryo gene.

I mean, it sounds to me like the headwinds you're facing a really sort of limited and the E.

Which I think is where the large sort of capital purchases occur the large freezer items. So that kind of makes sense to me, but if you could just sort of.

Run through the dollars coming from each of those divisions that would be really helpful.

Because it sounds to me like the growth rates are pretty good and some of these other divisions.

Hey, David I'm going to turn that over to Robert in just a moment.

The headwinds we are facing are.

Or more the global headwinds that we put in the Pea.

Press release and in the briefing.

Those headwinds.

Include things like.

The Ukraine, the Russian Ukrainian War.

Ukraine more than that.

That affected one of our top 10 lanes for cryo PDP in fact, we lost that line.

Because there is no volume in it right now and affected because they're our.

Trials are conducted in that part of the world.

Got it.

It is.

So their broader headwinds.

The economic conditions.

Europe are are worse than they are actually today in the United States. The oncoming of the of the recession that people are thinking about but not knowing how to actually approach. So those are some of the bigger headwinds Robert I'll turn that over to you for specificity. Yes. Just I mean, you are right in terms of your initial.

Statement about MBE and that shift from the larger freezers. So that certainly has a significant impact in Q3, and we expect that to continue into Q4 as well. However, cryo PDP was also impacted.

It may may recall cryo PDP is a very strong.

Infrastructure and presence in Europe , and in Asia, Pac and certainly because of Covid because of Russia, Ukraine. Their business has been impacted by those impacts on the regions to a much lesser extent clearport systems and really <unk>.

No no notable impact on the <unk> business, we don't break the revenue down into business units, but what I can provide you is if you look at the services revenue on the product revenue product revenue is really the vast majority is <unk> only and services a combination of prior PDP corporate systems and Cryo gene.

So if you look at the services revenue of $33 3 million for the quarter, it's up year over year, 8%, it's down sequentially, but if you look at year over year constant currency, it's actually up 14%. So you have the increase of private systems of roughly 25% or a little bit over 25%, which is somewhat offset.

By by some of the impacts described PDP experienced in the third quarter for the product revenue.

Year over year or 5%.

Increase.

Sequentially and Thats because of the items I just mentioned.

Okay. Okay.

So looking at the product revenue these large freezers.

Shifting to purchasing the smaller freezers.

Likely a lower price point.

Like these are mainly I am assuming can you can you just remind me like hospitals that are buying these solutions to put in their facilities. They can store the product, they're injected member or the patient with the seller gene therapy at the hospitals.

We saw no.

No okay.

No.

So David we sell we sell at MGE, we sell through a distributor network. So we don't have absolute visibility, but what we can tell you is that.

That's skewing towards the smaller units as we think is most likely control of capital expenditures and capital spending by our clients.

When they can find more to a smaller unit than a larger we think they are doing that we also know that there are number of startups in startups, usually use the smaller freezer. So that we think those are the.

The two primary drivers.

Just add these larger units that are purchased which are the stainless steel units, which are long term storage predominantly go into large academic institutions governmental institutions large pharma biotech and contract manufacturing assets.

The vast majority of these get placed they don't go into hospitals, unless it's a teaching hospital with our research and development arm.

But they're largely going into those other environments.

Okay. My only thought there is this is consistent with what we've seen elsewhere capex has been under pressure across the channel.

So this is consistent with what we've seen and then it looks like the clinical trial volumes are actually fine, they're up 10% plus year over year right.

Yes.

Michael trial number is up 10% year over year.

But in terms of volume from a revenue perspective, the clinical trial revenue is actually up 26%.

Okay. Thanks, very much I'll hop back in the queue.

Okay. Thank you thanks, David.

Okay.

We'll take our next question from David Saxon with Needham and company. Please go ahead.

Yes, hi, guys. Good afternoon, thanks for taking the questions.

I hopped on late from another call so I apologize.

Any of my questions have been asked but.

You bet.

The first question David Larsen asked.

The headwind headwinds you described I mean, these don't sound like short term challenges.

So and I get that the underlying business is showing strong fundamentals, but how should we think about.

Growth in Q2 2023.

Fourth quarter seems to be.

Low single digit growth.

So.

Help us out with kind of a framework.

How we should take about 23 revenue growth.

Yes, David that question has been answered and we will give you.

Guidance.

And when we report our fourth quarter lots happening right now we need to take into consideration will also give you guidance on our aspirational goal revision at that time.

Okay. Thanks for that and then hopefully this hasnt been been asked but.

The skewing to smaller units.

That youre seeing I guess, we.

Can you point to anything that gives us confidence that.

That dynamic is in competition.

Coming coming to a greater degree and it's really.

Customers are worried about their budgets and saving money on on smaller units. Thanks, so much.

David I'll give you an analogy and it's not a perfect analogy, but it's an analogy.

If you think about consumers and what they're doing and this is in consumers, but it's like when the gas prices go up people stop buying the BMW <unk>, 7% and I go to the three series or they quit buying and escalate and they go into a Chevy sedan.

So here you have our customers going from larger capital purchases with US two smaller units. So they are still buying from us.

They are buying a smaller unit. So if you look at units it's okay, but when you look at revenue per sale, it's down does that make sense.

Hi, Doug.

Maybe I can squeeze out of that third one in maybe just an update on the new.

Craig facility.

And then also the <unk>.

<unk> facility.

We're a production level that for those two facilities and I'll leave it there. Thanks.

Okay in terms of financial impact Robert can comment on that but I can tell you that we've had rolling shutdowns in China.

We have a number of our folks come from various districts and there has been.

Recurring shutdowns that have lasted over over a couple of weeks in China, which certainly has affected us in our manufacturing there.

New Craig as well.

Well recovered.

It's doing well.

I don't have any issues with that.

At all.

We do have a backlog that continues at <unk>.

And we're working vigorously to reduce that backlog it's sizable.

Okay. Thank you.

We will take our next question from me with B Riley Securities. Please go ahead.

Yes, Thank you for taking my questions.

First on the.

Commercial cell and gene therapies.

You saw that the revenue all of those product increased year over year by about 50% compared to the sort of cultural 'twenty to 'twenty. One however quite of course the revenue from this segment from the commercial therapy part was up 23%.

Help us understand what's missing between these two numbers is it because crime core it doesn't capture and we're seeing from that market.

Sorry, guys.

I missed part of that can you repeat it.

You've dropped down a little bit on me.

Yes, alright, so for the commercial cell and gene therapy is the increased 15% year over year compare to the <unk>.

Sure Paul I'll turn I'll turn your attention to one.

Cryo portion of revenue from this segment.

<unk> was up 3%. So can you help us understand what's missing in between those two numbers is it because <unk> didn't capture and we're seeing.

Commercial products.

Yes, so our commercial revenue you're right from cell and gene therapy did raised 23% year over year.

We do have significant confidence that our commercial revenue will continue to ramp.

As our customers continue to ramp their therapy on a global basis as well as introduced earlier lines of therapies and new therapies to the market.

And as we did outline in our Q3 review in.

Our customers are making significant progress we've got six BLA and MAA filings that made the first nine months of this year and seven more commercial filings.

This year.

And.

And we also have noted that we expect potentially to more commercial approvals in the fourth quarter.

So we actively work on forecast directly received from our customers.

And a lot of our internal forecasting.

So we do continue to see and anticipate significant growth and progress in the commercial space in the coming quarters.

Okay got it so maybe Australia.

In a different way.

His comments.

Market share change in the cryogenic logistics services and employee segment.

Yes.

So just to go back to that one second just just to let you know.

We have 100% track record on converting our all of our clinical pipeline of commercial and every single commercial client that we have we still support.

Okay.

Yes, Thanks Paul.

You added you added MGE as well and we don't we don't believe that there is any change in market share for our MBE.

<unk> global business.

Got it.

So yes in the sense for <unk>.

Couple of questions.

Thank you.

And we will go ahead and take our next question from Jacob Johnson with Stephens. Please go ahead.

Hey, Thanks, good evening.

Maybe first kind of a.

A higher level strategic question as I think about.

Legacy cryo for it in the history of the company a lot of what you're focused on was transporting final drug product with this Takeda partnership and some of the other things you've done. It seems like you are starting to move into kind of the drug substance manufacturing workflow shall we think about as we think about M&A or maybe partnerships going forward.

That's an area you will continue to add capabilities.

No.

No.

Our strategy is not to be in the manufacturing is not to POC, a demo or anything of that nature. Our strategy is to build the essential supply chain platform supporting the life Sciences now.

Let me just add to that so.

The entire focus around building out the collection and processing and of the business is what Jerry it's all around patient accessibility and standardized product as it relates to collection activity on a global basis. This is a huge headache for the industry and we view both of these elements of supply.

Chain considerations around supporting our partners from our contract manufacturing or an Oregon internal manufacturing basis, and we're trying to provide them the vehicle by which to optimize their manufacturing paradigm to reduce the number of slots at our mist due to scheduling considerations and other things.

Along those lines to improve the product quality to better manage cost of goods and most importantly to extend patient access.

Into the community care setting.

The problem is is the vast majority of these programs right now are pushing all through the same teaching centers and so they're competing for the same patients. They are competing for the same.

Same infrastructure.

And so US building this infrastructure out in conjunction with the Takeda team provides a vehicle by which to standardized and extend that ability. So we viewed as a supply chain extension.

Okay that makes sense. Thanks for that Dr. <unk> and then just on MBE, yes, there's been a number of moving pieces. There just I guess a couple of questions.

If you can when should we think about that asset returning to more normalized growth. What do you think that growth looks like and then the other thing you noted a lot of that is through distributors.

And given some of the moving pieces. There. This year just how would your visibility do you think you have into that business maybe versus other areas.

Our visibility is limited because of the distribution network and we also know that many other things that are impacting the market.

Headwinds that we've outlined and in our documentation.

So I don't have visibility on when that business returns to.

The mix changes and that sort of thing we will just keep you apprised as we move along we're working through it and we will gain more intelligence and more insight as we move along.

Got it thank you Gerry.

Thank you.

And with that we have no further questions I would like to turn the call back over to our management for any additional or closing remarks.

Well, thank you operator.

And thank you for your questions and our discussion and some reasons third quarter was a challenge.

Where we experienced a plethora of economic pressures that impacted revenue. Despite these short term external issues, we continue to see solid demand in our target markets.

<unk> primary cell and gene manufacturing customers demonstrated by crop port systems growth and continued momentum as evidenced by increased the increased number of clinical programs. We support we want to thank you for joining us this evening.

We appreciate your continuing interest in our company and we look forward to updating you again on our progress next quarter.

When we report the 2022 results.

Hope you all have a good evening and thank you very much.

Yeah.

And with that that does conclude today's call. Thank you for your participation you may now disconnect.

Okay.

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<unk>.

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