🎞 #LiveWithChaudhrey S06E067 with Repligen Corporation CEO Olivier Loeillot March 6th 2025

I'm doing fantastic. Rizwan, it's so good to see you again and welcome to Repligen today.

Yeah, that's a good question, Rizwan. All I can tell you is it's very exciting for us to have those people joining us very soon because we've been looking at expanding our PAT offering for several years already. And one of the biggest successes we've had as a Repligen business was to implement PAT into our downstream system offering. So when we figured out what 908 Devices had to offer, which is like four very exclusive, very differentiating PAT technologies, we figured out we need to have these guys with us because that's going to enable us to really expand that incredible journey that is in front of us implementing PAT in manufacturing systems here. So that's really one of them. And then the second one is it's not the ultimate goal. Obviously, getting data is fantastic, but how do you analyze data? How do you make sure you're going to be able to capitalize on artificial intelligence software in the future so that our customers can become more intelligent faster to develop products and better at manufacturing those same products as well?

Yeah, you're absolutely right. 2024 was a pretty tough year for the industry in general. As we really like challenges at Repligen, we added some more challenges on our side. What was historically our biggest business, protein, had a lot of headwinds because some of our OEM partners decided to stop working with us. So we had a lot of changes when we started the year, and we are delighted that we managed to generate about 3% growth excluding COVID in 2024, which is setting us up for a very strong start in 2025.

Yeah, you know, we're trying to track all of the different customer segments and where we saw both pharma and consumable market rebounding very nicely already a year ago. It took probably another six months to start to see both the CDMO segment as well as the hardware business rebounding. And we were really happy particularly during quarter four where both of these segments, CDMOs and hardware, rebounded tremendously well for us. And we know hardware was still a challenge for some of our competitors. We had a fantastic quarter four in terms of order intake because of the very differentiating portfolio of products we have here.

Yeah, I mean from an industry point of view, we are all recognizing there are many more green shoots today than there were a year or even two years ago, even more obviously. So I think as an industry we are much more optimistic overall. In terms of Repligen in particular, we've got this equation growth that we think has enabled us to grow faster than others and that we think will enable us to grow even faster in the future. That equation growth is really a mix of breakthrough innovation at a fast pace. One good example is we acquired that company called Tanti which is now giving us capabilities to develop a full resin manufacturing solution. And we know within a year we are really capable to develop resin for customers, and that is much faster than others. So innovation is number one. The second one is we are very focused on new modalities because we know it's very critical for our customers. Almost one product out of two at our pharma customers today is a new modality product. And we are very good at tackling that specific market segment because it requires speed, innovation, and a lot of customer centricity which we think we are pretty good at. And then the last piece really is whenever we are trying to gain market share, we are still trying to differentiate ourselves. We like to say that 80% of our portfolio is differentiating. Even for the remaining 20%, we're trying to bring something extra on what might be considered to be a me-too product. Let me give you an example on the fluid management side, what we call single-use technologies. We are just about to launch very exciting single-use mixers based on the Metanova technology, which the entire industry recognizes is the best mixing technology. We only had it on stainless steel; we'll have it now on single use, which is very expected by the entire market. So it's really a mix of all of that that gives us a lot of optimism about 2025.

Yeah, it's part of our DNA. I like to say whenever I talk to my investors, we've got two or three real features in our DNA. One of them is innovation. The second one is M&A. We've been managing to grow very fast because we've been good at acquiring companies under the M&A scheme of Repligen, which is trying to be exclusive as much as possible because we understand some of these very innovative technologies maybe earlier than others. So are we going to do more? Absolutely. Are we going to do more this year? Maybe. But we are for sure going to do more in the next few years.

Yeah, that's a great question, Rizwan. I like to say we bioprocessing companies have not done an awesome job to support pharma companies. When you think about it, pharma companies have been pretty heavy on artificial intelligence for already quite a while. In fact, when you look at drug discovery in particular, a lot of our customers are already using AI very extensively to identify new potential molecules to treat all of these very important diseases. So I think we as a bioprocessing company have to speed up now. Speeding up means giving access to those PAT technologies because again, artificial intelligence is only useful if you collect data, and data you're going to collect it via PAT. Now with the acquisition of 908 Devices, we're going to have six of the most differentiating PAT technologies in our hands, and that's going to be really enabling our customers later on to use the right artificial intelligence models to become much more efficient. So it's really an exciting time for Repligen and certainly for our customers as well.

More innovation. We just decided to increase our R&D budget. We're going to be probably around 6.5% of our total sales invested in R&D this year, which we think is really very good because that's what has been the engine of the company. We're investing more into commercial organization as well because we had tremendous success opening doors. One thing that sometimes people don't realize is the breadth of the portfolio we have. Even myself when I joined here, I didn't realize how broad of a portfolio we had. Now having much more focus on key accounts has given us a chance to open a lot of doors where those key accounts realize, 'Wow, Repligen is really becoming a real A-to-Z offering supplier for us.' That's something we love and we're going to keep on investing into. And finally, we talk quite a lot about digitization. I really want Repligen to be the digitization partner of our pharma customers to enable them to take advantage of all of this improvement coming around the corner.

This is a great question, Rizwan. I can tell you I joined about 15 months ago or so, and probably after a couple of months I said one thing we're going to have to make sure we have is to be fit for growth because we know we're going to be a much bigger company in the next few years. So now we have to find the right balance between keeping the culture we had, which is a culture of transparency to our customers, a culture of nimbleness, but at the same time making sure we are fit for growth, meaning we are strengthening some of our processes. I give you one example: we're going to implement Workday for our HR management this year, which I think for a company of 1,650 people is absolutely of essence, but will be even more important once we are 3,000 or 4,000 people in a few years from now. So fit for growth is definitely something we are very focused on.

Rizwan, thank you so much for taking the time. It's always a pleasure and the door is wide open for you anytime you want to come down here.