NASDAQ:BLFS BioLife Solutions Q1 2025 Earnings Report $21.78 -0.32 (-1.45%) Closing price 05/23/2025 04:00 PM EasternExtended Trading$21.99 +0.21 (+0.95%) As of 05/23/2025 07:53 PM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. ProfileEarnings HistoryForecast BioLife Solutions EPS ResultsActual EPS$0.04Consensus EPS -$0.03Beat/MissBeat by +$0.07One Year Ago EPSN/ABioLife Solutions Revenue ResultsActual Revenue$23.94 millionExpected Revenue$22.22 millionBeat/MissBeat by +$1.72 millionYoY Revenue GrowthN/ABioLife Solutions Announcement DetailsQuarterQ1 2025Date5/8/2025TimeAfter Market ClosesConference Call DateThursday, May 8, 2025Conference Call Time4:30PM ETConference Call ResourcesConference Call AudioConference Call TranscriptPress Release (8-K)Quarterly Report (10-Q)Earnings HistoryCompany ProfilePowered by BioLife Solutions Q1 2025 Earnings Call TranscriptProvided by QuartrMay 8, 2025 ShareLink copied to clipboard.PresentationSkip to Participants Operator00:00:00Good afternoon, ladies and gentlemen, and thank you for standing by. Welcome to the BioLife Solutions First Quarter twenty twenty five Shareholder and Analyst Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. I will now turn the call over to Troy Wickerman, Chief Financial Officer of BioLife Solutions. Operator00:00:23Please go ahead. Troy WichtermanCFO at BioLife Solutions00:00:24Thank you, operator. Good afternoon, everyone, and thank you for joining the BioLife Solutions twenty twenty five first quarter earnings conference call. On the call with me today is Roderick DeGrief, CEO and Chairman of the Board. We will cover business highlights and financial performance for the quarter and affirm our full year 2025 financial guidance. Earlier today, we issued a press release announcing our financial results and operational highlights for the first quarter of twenty twenty five, which is available at biolifesolutions.com. Troy WichtermanCFO at BioLife Solutions00:00:57As a reminder, during this call, we will make forward looking statements. These statements are subject to risks and uncertainties that can be found in our SEC filings. These statements speak only as of the date given and we undertake no obligation to update them. We will also speak to non GAAP or adjusted results. Reconciliations of GAAP to non GAAP or adjusted financial metrics are included in the press release we issued this afternoon. Troy WichtermanCFO at BioLife Solutions00:01:26Now I'd like to turn the call over to Rod DeGrief, Chairman and CEO of BioLife. Rod de GreefChairman & CEO at BioLife Solutions00:01:31Thanks, Troy. Good afternoon and thank you for joining us for BioLife's first quarter twenty twenty five conference call. The first quarter marked a strong start to 2025 meeting our expectations as we continue to execute our strategic priorities and build on the momentum of 2024. We delivered solid top line performance with our cell processing revenue increasing 33% compared with Q1 last year and total revenue up 30% year over year. With another sequential increase in cell processing revenue and meaningful expansion of our adjusted EBITDA margin, which came in at 24%, we're realizing the operating leverage and financial strength of our optimized portfolio and streamlined operations resulting from the strategic initiatives we carried out last year. Rod de GreefChairman & CEO at BioLife Solutions00:02:22With a fortified balance sheet with over $100,000,000 in cash at the end of the quarter, we are on solid footing to navigate what remains a dynamic operating environment and to invest in growth initiatives, support innovation and drive market share. We remain steadfast in our commitment to delivering leading solutions to the cell and gene therapy market and are confident in our strategy, competitive positioning and ability to deliver sustainable growth throughout 2025. Looking at our first quarter revenue in a little more detail, our cell processing platform delivered $21,600,000 a 33% year over year increase and up 6% sequentially over Q4 last year, marking our sixth consecutive quarter of revenue growth. This performance was driven by continued strength in our core biopreservation media or BPM product line, which represents the majority of our cell processing platform. In Q1, our top 20 customers continue to account for approximately 80% of BPM revenue, which provides us with heightened visibility to a large and critical part of our business. Rod de GreefChairman & CEO at BioLife Solutions00:03:32Approximately 60% of our BPM revenue comes from direct sales and 40% through distribution. Notably, around 40% of total BPM revenue came from customers with an approved commercial therapy. Said another way, this translates into about 60% of our direct BPM revenue coming from customers that have an approved commercial therapy. While a portion of that demand supports clinical pipeline programs and process development validation rather than patient dosing, we expect these commercial customers to drive growth throughout the remainder of the year. I highlight this because it provides an important measure of resilience in our business model, mitigating exposure to earlier stage programs that may be more vulnerable to funding or regulatory constraints. Rod de GreefChairman & CEO at BioLife Solutions00:04:23Overall, these metrics remain broadly consistent with what we saw in 2024, reinforcing the stability and durability of our cell processing business. At the end of the first quarter, our BPM products were utilized in a total of 17 approved therapies. As we've shared before, we estimate our BPM products are used in at least 70% of relevant commercially sponsored CGT trials in The U. S. With our share of late stage clinical trials exceeding 75%. Rod de GreefChairman & CEO at BioLife Solutions00:04:55At this point, the only meaningful alternative to our offering is homebrew formulations, which while perhaps functional at a small scale, lack the rigor, consistency and scalability that our GMP grade solutions provide. Our sales and marketing team remains focused on deepening relationships with our key BPM customers, both commercial and clinical, in order to create cross sell opportunities and drive adoption of our broader cell processing platform. Today, our CellSeal and HPL products are integrated into four approved therapies in The U. S. And internationally, in addition to being used in numerous clinical trials. Rod de GreefChairman & CEO at BioLife Solutions00:05:35We see a significant opportunity to scale these products over time. Importantly, each additional product integrated into a commercial therapy can materially enhance our revenue on a per dose basis with the potential to generate up to two to three times the revenue per dose compared to our BPM products alone. I would emphasize that this opportunity is not hypothetical. We have demonstrated success with customers who have adopted multiple components of our platform, validating both our product quality and our role as a trusted scalable partner. As we continue to execute, we believe expanding our footprint with these commercial therapies will be a durable mid to long term growth engine for BioLife. Rod de GreefChairman & CEO at BioLife Solutions00:06:21In April, we further advanced our strategy with the acquisition of Panthera CryoSolutions, an innovative addition that expands our biopreservation portfolio with proprietary ice recrystallization inhibitor technology and enhances the scientific capabilities of our team. This transaction reflects our ongoing commitment to selectively deploy capital to strengthen our offerings and reinforce our leadership as a pure play provider of bioproduction consumables. While we remain optimistic that the underlying longer term industry fundamentals remain intact, we recognize that near term uncertainty persists, whether from tariffs, NIH funding cuts or leadership changes at the FDA, all of which have the potential of creating near term headwinds across the ecosystem. We continue to closely monitor and assess these factors from both the supplier and a customer perspective. And at this time, we do not expect any material impact on our financial outlook. Rod de GreefChairman & CEO at BioLife Solutions00:07:21Accordingly, we are reaffirming our full year revenue guidance of 95,500,000.0 to $99,000,000 with growth continuing to be led by our cell processing platform and more specifically our commercial customers. With that, I'll hand the call over to Troy, who will provide an overview of our full Q1 results. Troy? Troy WichtermanCFO at BioLife Solutions00:07:42Thank you, Rod. We reported Q1 revenue of $23,900,000 representing an increase of 30% year over year. The year over year increase was primarily related to a 33% increase in our cell processing platform, driven by an increase in biopreservation media revenue. GAAP gross margin for Q1 twenty twenty five was 63% compared with 63% in Q1 twenty twenty four. Adjusted gross margin for the first quarter was 66% compared with 66% in the prior year. Troy WichtermanCFO at BioLife Solutions00:08:16Although our adjusted gross margin percentage remained consistent year over year, we had an increase of $3,500,000 or 29% in gross margin dollars, reflecting strong revenue growth compared to the prior year. GAAP operating expenses for Q1 twenty twenty five were 25,200,000 versus $21,700,000 in Q1 twenty twenty four. The increase compared to the prior year was largely due to increases in cost of sales from revenue growth and acquisition related fees from our Panthera acquisition, which we closed on April 4. Adjusted operating expenses for Q1 twenty twenty five totaled $14,900,000 compared with $14,600,000 in the prior year. GAAP operating loss for Q1 twenty twenty five was $1,200,000 versus $3,300,000 in the prior year. Troy WichtermanCFO at BioLife Solutions00:09:10Our adjusted operating income for the first quarter of twenty twenty five was $900,000 compared with an adjusted operating loss of $2,400,000 in Q1 twenty twenty four. The decrease in GAAP operating loss was primarily due to an increased revenue of $5,500,000 compared to the same period in the prior year. Our GAAP net loss was $400,000 or $01 per share in Q1 compared to $3,200,000 or $07 per share in the prior year. The decrease in net loss was primarily due to a $3,500,000 improvement in gross margin. Adjusted EBITDA for the first quarter of twenty twenty five was $5,700,000 or 24% of revenue compared with $2,600,000 or 14% of revenue in the prior year. Troy WichtermanCFO at BioLife Solutions00:10:01Adjusted EBITDA increased from the prior year primarily due to a $3,500,000 improvement in gross margin driven by increased sales of biopreservation media. Turning to our balance sheet. Our cash and marketable securities balance reported as of 03/31/2025 was $107,600,000 compared with $109,200,000 as of 12/31/2024. Taking into consideration our adjusted EBITDA of $5,700,000 in Q1, cash usage was primarily driven by unfavorable working capital of 3,200,000 debt principal payments of $2,500,000 and capital expenditures of $1,000,000 Our SVB long term debt balance at quarter end was $12,500,000 We expect to continue making quarterly repayments of $2,500,000 going forward. Turning to our 2025 financial guidance, which we are affirming our original guidance from our Q4 earnings call. Troy WichtermanCFO at BioLife Solutions00:11:06Total revenue is expected to be $95,500,000 to $99,000,000 reflecting an overall growth of 16% to 20%. Our cell processing platform is expected to contribute $86,500,000 to 89,000,000 or 18% to 21% growth over 2024. Our EVO and THOP platform is expected to contribute $9,000,000 to $10,000,000 or 3% to 15% growth over 2024. We expect adjusted gross margin for the full year to be in the mid-60s, a reduction in GAAP net loss and expansion in adjusted EBITDA margin in 2025 due to higher expected revenue, partially offset by increases in R and D expenses related to development projects and an estimated $1,000,000 in R and D related expenses from our Panthera acquisition for the balance of 2025. We do not expect any material revenue from Panthera in 2025. Troy WichtermanCFO at BioLife Solutions00:12:09Finally, in terms of our share count, as of May 1, which includes shares issued from our Panthera acquisition, we had 47,600,000.0 shares issued on outstanding and 50,100,000.0 shares on a fully diluted basis. Now I'll turn the call back to the operator to open up for questions. Operator00:13:00And the first question comes from Matt Stanton with Jefferies. Please go ahead. Matthew StantonAnalyst at Jefferies00:13:06Hey, thanks for taking the question. Maybe Rod first for you. I appreciate all the color on the progress on the commercial side of the business, but maybe just to focus a little bit on the non commercial and more clinical side of the business, which is the other 60 or so. Can you just kind of talk about level of visibility into trends there? What you're hearing from customers? Matthew StantonAnalyst at Jefferies00:13:26Obviously, there's no shortage of headlines around the FDA funding and things like that. Maybe it's a bit of have and have nots on the funding side, but just a little bit more clarity or update on what you're hearing and seeing in terms of demand trends and patterns from that clinical side of the business today? Thanks. Rod de GreefChairman & CEO at BioLife Solutions00:13:44Sure. The clinical customers that buy direct from us, actually came in reasonably well for the quarter, right? So we don't really see anything in the near term at that point. It's not a significant up. The growth for the quarter was definitely driven by our commercial customers. Rod de GreefChairman & CEO at BioLife Solutions00:14:06Where we would see the majority of any kind of impact from the issues you're raising here would be on the distribution side. And while we don't have perfect visibility to the customer segmentation of those distributors, distributors came in the two large ones in particular, came in as we had expected. So right now and we're in contact with them on a pretty regular basis, couple of times a month. Last week, I sat in on our quarterly business review with our largest distributor, also our largest customer, and they're not signaling any sort of slowdown in demand at this point in time, although they're clearly aware of the potential impact of, let's say, NIH funding cuts. I think the potential for delays relative to changes and cuts at the FDA, I think that's going to play out over a longer period of time as opposed to this quarter, next quarter, if it plays out at all. Matthew StantonAnalyst at Jefferies00:15:06Great. That's really helpful color. And then maybe just on the Panthera deal, maybe you can talk a little bit about more why it makes sense, proof points we can expect going forward. You obviously had kind of a front row seat there the last few years with your involvement in the asset prior. And what does the team bring you today that you didn't have before? Matthew StantonAnalyst at Jefferies00:15:24And is there kind of a product pipeline where you have the opportunity to layer some of the stuff they've been working on into your existing offering? Thank you. Rod de GreefChairman & CEO at BioLife Solutions00:15:35Yes. I think that from a timing perspective, the reason we did this now is because they had demonstrated proof of concept with their first generation molecules. So we felt comfortable that the fundamental technology worked. And what we wanted to do was be in a position to be able to very completely control the future development of the next gen molecule so that the focus and all of the effort from a scientific perspective was in combining that next gen molecule with our CryoStor product line. So that's what the focus is for the next eighteen months. Rod de GreefChairman & CEO at BioLife Solutions00:16:11And I think as we've said, really the opportunity for us is to have a next gen line of cryopreservation products, which can do one of three things, if not more than one of those three things combined. One would be having just a cryopreservation product that has more efficacy in general with maybe some different types of cell types. The other is to have the same efficacy but with potentially lower concentrations of DMSO, which some customers have signaled as important to them. And then I think the third opportunity really is to create a product that would allow us to cryopreserve cells and tissues that could be held and transported at minus 80, so that's a dry ice kind of temperature range, versus minus 196, which would be LN2. So the logistics around LN2 transportation and storage are significantly more sophisticated than dry ice shipments. Rod de GreefChairman & CEO at BioLife Solutions00:17:16So from a scientific team, we added two very experienced, very well regarded scientists. What that does is not only just backfill from a risk mitigation perspective, given that we had a very small team of one or two folks, depending on how you want to look at it, but it also allows us to increase the throughput of the scientific experiments that are going to be done here in the next twelve to eighteen months. Matthew StantonAnalyst at Jefferies00:17:43Thanks. Appreciate it. And congrats on the strong quarter. Rod de GreefChairman & CEO at BioLife Solutions00:17:46Thank you. Operator00:17:49And your next question comes from Paul Knight with KeyBanc. Please go ahead. Paul KnightManaging Director at KeyBanc Capital Markets00:17:54Hi, Rod. Hi, Troy. Congrats on the quarter. Rod, where are you in the pricing journey that you are on? I know that you're working on across the board changes. Paul KnightManaging Director at KeyBanc Capital Markets00:18:12Are you half done, a third done? And does this happen over what three years? Rod de GreefChairman & CEO at BioLife Solutions00:18:17Yes. We're more than half done Paul on sort of the four or five key customers that had significant legacy discounts that are not applicable to the world we are in today. Some of them kick in, one large one kicks in, in the second half of the year just based on their own fiscal year and just the negotiations that took place. And they are, for the most part, given the magnitude of the clawback of the discounts, they are spread out over a thirty six month period on an annual basis. So we'll see a bit of a tailwind there over the next three years. Paul KnightManaging Director at KeyBanc Capital Markets00:18:55And then last question would be, how does the pipeline on M and A look? Rod de GreefChairman & CEO at BioLife Solutions00:19:04We are definitely looking at a few things, Paul, but we have a pretty strict filter criteria. We are in the process of actually working through a more robust sort of strategic technology summit, if you will, that's coming up here internally, which will include a couple of our directors, Tony Hunt being one of them, so that we have a very clear and tight filter criteria as we look at things going forward. That said, there are a couple of things, small tuck ins, not dissimilar to Panthera as it relates to how they would fit on the horizon. Paul KnightManaging Director at KeyBanc Capital Markets00:19:45Okay. Thanks. Rod de GreefChairman & CEO at BioLife Solutions00:19:47You bet. Operator00:19:52And your next question comes from Chad Witrowski with TD Cowen. Please go ahead. Chad WiatrowskiVP - Equity Research at TD Cowen00:19:59Hey, this is Chad Witrowski on for Brendan Smith. Was the limited impact from sort of tariffs NIH funding more of caused by maybe limited exposure or did you have to take steps like with your global distributors to sort of insulate yourself from some of that and maybe from a manufacturing standpoint? And just in general, what about that sort of 14% exposure to European revenues? Rod de GreefChairman & CEO at BioLife Solutions00:20:29Yes. Thanks, Chad. I think that when we did our analysis internally here around tariffs, and NIH cuts, we really looked at the tariff side of it between suppliers first and then customers. So on the supplier side, all of our products for cell processing revenue are manufactured here in The United States, and we have very little exposure to foreign raw material inputs. So we're pretty comfortable that there's not going to be any impact on our cost of goods, certainly not any material impact on our cost of goods at this point in time. Rod de GreefChairman & CEO at BioLife Solutions00:21:04If that were to change, we would go ahead and implement some sort of surcharge program, which we did with respect to the freezer businesses we owned during COVID. On the customer side, on the direct customer side, which represents about 60% of our revenue, we also think we have very little exposure, almost no exposure to China. So we do have exposure to Europe, But we believe that the product that's being sold into Europe Direct is primarily sold to customers that are in late stage clinical and or have a commercial therapy that is already for the most part manufactured there. So our product is such a critically enabling tool for the development of their therapies that we don't believe a 10% or 20% tariff on our product is going to make a bit of difference in terms of their utilization. It's certainly not going to be enough to make them think about switching. Rod de GreefChairman & CEO at BioLife Solutions00:22:05So we're pretty comfortable with the customers on the direct side. We do have some greater exposure on the distribution side, but we've been spending a lot of time in particular with our largest distributor, again, largest customer, understanding their exposure to China, which is more than ours by a bit. And their view on the Chinese exposure from their perspective is that they expect the Chinese government to either exempt and or subsidize these particular products so that they're protecting their own biotech industry. That's number one. For the rest of the world from a distribution perspective, they also feel that the incremental amount or increase in cost of product relative to tariffs would be relatively de minimis to those customers. Rod de GreefChairman & CEO at BioLife Solutions00:22:57And therefore, they, to date at least, have not changed their rolling twelve month forecast for us. Although I can tell you it's something that we're in constant conversation with them, probably two times a month. Chad WiatrowskiVP - Equity Research at TD Cowen00:23:10Really helpful color, Rod. Thanks. Rod de GreefChairman & CEO at BioLife Solutions00:23:13You bet. Operator00:23:17And your next question comes from Thomas Flaten with Lake Street. Please go ahead. Thomas FlatenSenior Research Analyst at Lake Street Capital Markets, LLC00:23:22Hey, good afternoon guys. Congrats on a great quarter. Hey, Rod, just to follow-up kind of on a prior question with respect to the pipeline for M and A. Obviously, you've got a nice little cash hoard at this point. Any other big projects we should be aware of CapEx, facility build outs other than M and A that we should be thinking about? Rod de GreefChairman & CEO at BioLife Solutions00:23:42Yes. I think we definitely are in the process of planning. So I think I may have mentioned on a previous call that we have leased earlier this year, we leased the Third Floor of the building that houses our current manufacturing, which is on the First Floor. So that gives us an additional $75,000,000 or so of capacity with respect to biopreservation media. So that's a sub-ten million dollars kind of investment, more like 5,000,000 to 6,000,000 when you net it with the TIs. Rod de GreefChairman & CEO at BioLife Solutions00:24:13So the larger CapEx project is in Indianapolis, where our lease runs out in the facility that we're in and have been in for a number of years. So we're in the process of identifying another facility. We will be building out a clean room for the manufacturing of HPL, which is what we do in Indianapolis. And also plan on doing the fulfillment of all of our products from a business continuity standpoint, keeping our nine months of finished goods inventory there in Indy. So that will be a larger CapEx expense, but it's really a 26,000,000 event as opposed to 25 Thomas FlatenSenior Research Analyst at Lake Street Capital Markets, LLC00:24:54quick one on revenues. Anything we should be cognizant of now that we've shed the other businesses in terms of seasonality pacing of revenues across the balance of the year? Troy WichtermanCFO at BioLife Solutions00:25:04Yes. We don't really have much seasonality in our business in general. Summer months can be a little bit slow in Europe, but other than that, we don't have much of an impact for seasonality. Thomas FlatenSenior Research Analyst at Lake Street Capital Markets, LLC00:25:14Got it. Thanks guys. Rod de GreefChairman & CEO at BioLife Solutions00:25:16Thank you. Operator00:25:20And your next question comes from Matt Hewitt with Craig Hallum Capital Group. Please go ahead. Matthew HewittSenior Research Analyst at Craig-Hallum00:25:27Good afternoon. Thanks for taking the questions. Maybe circling back to the Panther acquisition, I think if I heard you correctly, you're looking at least eighteen months before you could see some revenues there. But I'm wondering how difficult or is it feasible that a customer could swap out the Panthera media in for their existing media? Is that something that can happen that you could see maybe even a commercial program already using a media swap yours in, specifically the Panthera? Rod de GreefChairman & CEO at BioLife Solutions00:26:00Yes. So good question. Last year, we did do we engaged with a third party consulting group that has expertise in CGT and we posed the question to them, what is the switching cost for CGT manufacturer to swap out the biopreservation media? And it was clear that as you go down further down the clinical pipeline, so let's say, clinic Phase III or commercial product, it becomes a very big hurdle. And by that I mean several million dollars and a couple of three years to do so. Rod de GreefChairman & CEO at BioLife Solutions00:26:36So it's unlikely that we would have any companies that have a product in the market switch out in part because the product works well for them today. So really the opportunity lies in to some degree the clinical pipeline of those commercial customers. And what we're finding out is those are pretty robust in terms of number of clinical trials. And the other would be then to move to the early part of the funnel and start to introduce that technology in the Phase one or preclinical timeframe, where we have a much easier job of swapping something out. Matthew HewittSenior Research Analyst at Craig-Hallum00:27:14Makes sense. And maybe separately regarding tariffs, on the off chance that you do start to face some headwinds there, do you have the ability to pass the tariff cost on to your customers via your current contracts? Or is that something that you would have to negotiate or figure out at that point? Rod de GreefChairman & CEO at BioLife Solutions00:27:36Are you speaking to tariffs that might be attached to raw material inputs and therefore increasing our cost of goods? Matthew HewittSenior Research Analyst at Craig-Hallum00:27:44Correct. Rod de GreefChairman & CEO at BioLife Solutions00:27:46Yes. So I think that, yes, the answer is we would if there's anything material, we would go ahead and put a surcharge on it for our customers. As I said, we have done that in the past. There's nothing in our supply agreements that prohibits us from doing that. Obviously, we'd want to be pretty judicious about that. Rod de GreefChairman & CEO at BioLife Solutions00:28:07But we would do it if it turns out to be a material increase in any way to our own COGS. Matthew HewittSenior Research Analyst at Craig-Hallum00:28:13Makes sense. All right. Thank you. Rod de GreefChairman & CEO at BioLife Solutions00:28:15Thank you. Operator00:28:19And your next question comes from Carl Byrnes with Northland Capital Markets. Please go ahead. Carl ByrnesManaging Director at Northland Capital Markets00:28:26Congratulations on the results on the quarter. Most of my questions have been answered. I'm wondering if we can go back to Panthera in terms of what you expect the incremental OpEx would be. I'm imagining, as you mentioned in your prepared comments, most of it's going be in the R and D line. Thanks. Troy WichtermanCFO at BioLife Solutions00:28:42Yes, that's correct, Karl. To the tune of about, call it, dollars 1,000,000 for the remaining nine months of the year. Carl ByrnesManaging Director at Northland Capital Markets00:28:48Okay. That's what I thought you said, but I wanted to check. Cool. Excellent. Congrats again. Carl ByrnesManaging Director at Northland Capital Markets00:28:52Thanks. Troy WichtermanCFO at BioLife Solutions00:28:53Thank Thank you. Operator00:28:57And your next question comes from Yi Chen with H. C. Wainwright. Please go ahead. Yi ChenManaging Director & Senior Analyst at H.C. Wainwright & Co., LLC00:29:05Thank you for taking my question. Just curious, is BioLife likely to benefit at all from pharmaceutical and biotechnology manufacturing onshoring due to tariff over the course of the coming quarters? And if so, to what extent? Rod de GreefChairman & CEO at BioLife Solutions00:29:23Yes. It's a fair question. Rod de GreefChairman & CEO at BioLife Solutions00:29:25I think it's very early to try to quantify anything. Again, I think you got to remember that our product is an incredibly small part, and by that I mean probably less than 1% of a CGT manufacturer's cost of goods. So the fact that they're manufacturing product abroad and then importing their cryopreservation for the drugs that are being sold in say Europe or Asia, I just think it's a de minimis amount and it's just simply not an issue at this point as far as we can see. Yi ChenManaging Director & Senior Analyst at H.C. Wainwright & Co., LLC00:30:02Got it. Thank you. Rod de GreefChairman & CEO at BioLife Solutions00:30:04Thank you. Operator00:30:08This concludes our question and answer session. I would like to turn the conference back over to Roderick DeGreef for any closing remarks. Rod de GreefChairman & CEO at BioLife Solutions00:30:17Thank you, Mike. In closing, the first quarter positions us well for the year ahead. We remain confident in our ability to navigate potential headwinds with minimal impact to our financial results. Thank you for your time this afternoon and we look forward to updating you as we move through the year as well as seeing some of you at investor conferences later this year. Operator00:30:43The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.Read moreParticipantsExecutivesTroy WichtermanCFORod de GreefChairman & CEOAnalystsMatthew StantonAnalyst at JefferiesPaul KnightManaging Director at KeyBanc Capital MarketsChad WiatrowskiVP - Equity Research at TD CowenThomas FlatenSenior Research Analyst at Lake Street Capital Markets, LLCMatthew HewittSenior Research Analyst at Craig-HallumCarl ByrnesManaging Director at Northland Capital MarketsYi ChenManaging Director & Senior Analyst at H.C. Wainwright & Co., LLCPowered by Key Takeaways Strong Q1 results and guidance reaffirmed: Total revenue grew 30% year-over-year to $23.9 million with cell processing revenue up 33% and adjusted EBITDA margin expanding to 24%, and management reaffirmed full-year 2025 revenue guidance of $95.5 million to $99 million. Biopreservation Media (BPM) platform momentum: BPM revenue rose six consecutive quarters, serving 17 approved therapies and capturing at least 70% of U.S. CGT trials with over 75% share in late-stage studies, providing resilience against early-stage funding swings. Cross-sell growth opportunity: Integration of CellSeal and HPL into four approved therapies could deliver 2–3× more revenue per dose than BPM alone, with the sales team targeting deeper adoption among both commercial and clinical customers. Strategic acquisition of Panthera CryoSolutions: Acquired to access ice recrystallization inhibitor technology and bolster R&D, aiming to develop next-generation cryopreservation products that lower DMSO concentrations and enable –80 °C storage. Robust balance sheet and risk management: Ended Q1 with $107.6 million in cash, plans $2.5 million quarterly debt repayments, and while monitoring tariffs, NIH funding cuts and FDA changes, no material impact is expected on financial outlook. AI Generated. May Contain Errors.Conference Call Audio Live Call not available Earnings Conference CallBioLife Solutions Q1 202500:00 / 00:00Speed:1x1.25x1.5x2xTranscript SectionsPresentationParticipants Earnings DocumentsPress Release(8-K)Quarterly report(10-Q) BioLife Solutions Earnings HeadlinesBioLife Solutions (NASDAQ:BLFS) Stock Rating Lowered by StockNews.comMay 21, 2025 | americanbankingnews.comHC Wainwright Has Positive Outlook for BLFS Q2 EarningsMay 16, 2025 | americanbankingnews.comWhite House to reset Social Security?Elon Musk's parting DOGE gift looks set to shock America... A single announcement by July 22nd could soon bring Elon Musk's DOGE operation to its final, dramatic conclusion - with huge consequences for millions of investors. So if you have any money in the market... you're almost out of time to prepare. This plan has already been put in place... and can operate even if Elon's long gone from Washington. May 25, 2025 | Altimetry (Ad)BioLife Solutions to Participate in Upcoming Investor Conferences in May and June 2025May 14, 2025 | prnewswire.comEarnings call transcript: BioLife Solutions Beats Q1 2025 ExpectationsMay 10, 2025 | uk.investing.comBioLife Solutions, Inc. (NASDAQ:BLFS) Q1 2025 Earnings Call TranscriptMay 10, 2025 | msn.comSee More BioLife Solutions Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like BioLife Solutions? Sign up for Earnings360's daily newsletter to receive timely earnings updates on BioLife Solutions and other key companies, straight to your email. Email Address About BioLife SolutionsBioLife Solutions (NASDAQ:BLFS) develops, manufactures, and markets bioproduction tools and services for the cell and gene therapy (CGT) industry in the United States, Europe, the Middle East, Africa, and internationally. The company's products are used in the basic and applied research, and commercial manufacturing of biologic-based therapies. It offers proprietary biopreservation media products, including HypoThermosol FRS and CryoStor Freeze Media that are formulated to mitigate preservation-induced, delayed-onset cell damage and death; bioproduction tools, such as human platelet lysates for cell expansion and CellSeal closed system vials that are used in CGT; and the ThawSTAR line that comprises of a family of automated thawing devices for frozen cell and gene therapies packaged in cryovials and cryobags. The company also provides cryogenic freezer technology for controlled rate freezing and cryogenic storage of biologic materials; ultra-low temperature mechanical freezers; evo shipping containers that are cloud-connected passive storage and transport containers for temperature-sensitive biologics and pharmaceuticals; liquid nitrogen laboratory freezers, cryogenic equipment, and accessories; and biological and pharmaceutical storage and transport services. It markets and sells its products directly, as well as through third party distributors. The company was incorporated in 1987 and is headquartered in Bothell, Washington.View BioLife Solutions ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Booz Allen Hamilton Earnings: 3 Bullish Signals for BAH StockAdvance Auto Parts Jumps on Surprise Earnings BeatAlibaba's Earnings Just Changed Everything for the StockCisco Stock Eyes New Highs in 2025 on AI, Earnings, UpgradesSymbotic Gets Big Earnings Lift: Is the Stock Investable Again?D-Wave Pushes Back on Short Seller Case With Strong EarningsAppLovin Surges on Earnings: What's Next for This Tech Standout? 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PresentationSkip to Participants Operator00:00:00Good afternoon, ladies and gentlemen, and thank you for standing by. Welcome to the BioLife Solutions First Quarter twenty twenty five Shareholder and Analyst Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. I will now turn the call over to Troy Wickerman, Chief Financial Officer of BioLife Solutions. Operator00:00:23Please go ahead. Troy WichtermanCFO at BioLife Solutions00:00:24Thank you, operator. Good afternoon, everyone, and thank you for joining the BioLife Solutions twenty twenty five first quarter earnings conference call. On the call with me today is Roderick DeGrief, CEO and Chairman of the Board. We will cover business highlights and financial performance for the quarter and affirm our full year 2025 financial guidance. Earlier today, we issued a press release announcing our financial results and operational highlights for the first quarter of twenty twenty five, which is available at biolifesolutions.com. Troy WichtermanCFO at BioLife Solutions00:00:57As a reminder, during this call, we will make forward looking statements. These statements are subject to risks and uncertainties that can be found in our SEC filings. These statements speak only as of the date given and we undertake no obligation to update them. We will also speak to non GAAP or adjusted results. Reconciliations of GAAP to non GAAP or adjusted financial metrics are included in the press release we issued this afternoon. Troy WichtermanCFO at BioLife Solutions00:01:26Now I'd like to turn the call over to Rod DeGrief, Chairman and CEO of BioLife. Rod de GreefChairman & CEO at BioLife Solutions00:01:31Thanks, Troy. Good afternoon and thank you for joining us for BioLife's first quarter twenty twenty five conference call. The first quarter marked a strong start to 2025 meeting our expectations as we continue to execute our strategic priorities and build on the momentum of 2024. We delivered solid top line performance with our cell processing revenue increasing 33% compared with Q1 last year and total revenue up 30% year over year. With another sequential increase in cell processing revenue and meaningful expansion of our adjusted EBITDA margin, which came in at 24%, we're realizing the operating leverage and financial strength of our optimized portfolio and streamlined operations resulting from the strategic initiatives we carried out last year. Rod de GreefChairman & CEO at BioLife Solutions00:02:22With a fortified balance sheet with over $100,000,000 in cash at the end of the quarter, we are on solid footing to navigate what remains a dynamic operating environment and to invest in growth initiatives, support innovation and drive market share. We remain steadfast in our commitment to delivering leading solutions to the cell and gene therapy market and are confident in our strategy, competitive positioning and ability to deliver sustainable growth throughout 2025. Looking at our first quarter revenue in a little more detail, our cell processing platform delivered $21,600,000 a 33% year over year increase and up 6% sequentially over Q4 last year, marking our sixth consecutive quarter of revenue growth. This performance was driven by continued strength in our core biopreservation media or BPM product line, which represents the majority of our cell processing platform. In Q1, our top 20 customers continue to account for approximately 80% of BPM revenue, which provides us with heightened visibility to a large and critical part of our business. Rod de GreefChairman & CEO at BioLife Solutions00:03:32Approximately 60% of our BPM revenue comes from direct sales and 40% through distribution. Notably, around 40% of total BPM revenue came from customers with an approved commercial therapy. Said another way, this translates into about 60% of our direct BPM revenue coming from customers that have an approved commercial therapy. While a portion of that demand supports clinical pipeline programs and process development validation rather than patient dosing, we expect these commercial customers to drive growth throughout the remainder of the year. I highlight this because it provides an important measure of resilience in our business model, mitigating exposure to earlier stage programs that may be more vulnerable to funding or regulatory constraints. Rod de GreefChairman & CEO at BioLife Solutions00:04:23Overall, these metrics remain broadly consistent with what we saw in 2024, reinforcing the stability and durability of our cell processing business. At the end of the first quarter, our BPM products were utilized in a total of 17 approved therapies. As we've shared before, we estimate our BPM products are used in at least 70% of relevant commercially sponsored CGT trials in The U. S. With our share of late stage clinical trials exceeding 75%. Rod de GreefChairman & CEO at BioLife Solutions00:04:55At this point, the only meaningful alternative to our offering is homebrew formulations, which while perhaps functional at a small scale, lack the rigor, consistency and scalability that our GMP grade solutions provide. Our sales and marketing team remains focused on deepening relationships with our key BPM customers, both commercial and clinical, in order to create cross sell opportunities and drive adoption of our broader cell processing platform. Today, our CellSeal and HPL products are integrated into four approved therapies in The U. S. And internationally, in addition to being used in numerous clinical trials. Rod de GreefChairman & CEO at BioLife Solutions00:05:35We see a significant opportunity to scale these products over time. Importantly, each additional product integrated into a commercial therapy can materially enhance our revenue on a per dose basis with the potential to generate up to two to three times the revenue per dose compared to our BPM products alone. I would emphasize that this opportunity is not hypothetical. We have demonstrated success with customers who have adopted multiple components of our platform, validating both our product quality and our role as a trusted scalable partner. As we continue to execute, we believe expanding our footprint with these commercial therapies will be a durable mid to long term growth engine for BioLife. Rod de GreefChairman & CEO at BioLife Solutions00:06:21In April, we further advanced our strategy with the acquisition of Panthera CryoSolutions, an innovative addition that expands our biopreservation portfolio with proprietary ice recrystallization inhibitor technology and enhances the scientific capabilities of our team. This transaction reflects our ongoing commitment to selectively deploy capital to strengthen our offerings and reinforce our leadership as a pure play provider of bioproduction consumables. While we remain optimistic that the underlying longer term industry fundamentals remain intact, we recognize that near term uncertainty persists, whether from tariffs, NIH funding cuts or leadership changes at the FDA, all of which have the potential of creating near term headwinds across the ecosystem. We continue to closely monitor and assess these factors from both the supplier and a customer perspective. And at this time, we do not expect any material impact on our financial outlook. Rod de GreefChairman & CEO at BioLife Solutions00:07:21Accordingly, we are reaffirming our full year revenue guidance of 95,500,000.0 to $99,000,000 with growth continuing to be led by our cell processing platform and more specifically our commercial customers. With that, I'll hand the call over to Troy, who will provide an overview of our full Q1 results. Troy? Troy WichtermanCFO at BioLife Solutions00:07:42Thank you, Rod. We reported Q1 revenue of $23,900,000 representing an increase of 30% year over year. The year over year increase was primarily related to a 33% increase in our cell processing platform, driven by an increase in biopreservation media revenue. GAAP gross margin for Q1 twenty twenty five was 63% compared with 63% in Q1 twenty twenty four. Adjusted gross margin for the first quarter was 66% compared with 66% in the prior year. Troy WichtermanCFO at BioLife Solutions00:08:16Although our adjusted gross margin percentage remained consistent year over year, we had an increase of $3,500,000 or 29% in gross margin dollars, reflecting strong revenue growth compared to the prior year. GAAP operating expenses for Q1 twenty twenty five were 25,200,000 versus $21,700,000 in Q1 twenty twenty four. The increase compared to the prior year was largely due to increases in cost of sales from revenue growth and acquisition related fees from our Panthera acquisition, which we closed on April 4. Adjusted operating expenses for Q1 twenty twenty five totaled $14,900,000 compared with $14,600,000 in the prior year. GAAP operating loss for Q1 twenty twenty five was $1,200,000 versus $3,300,000 in the prior year. Troy WichtermanCFO at BioLife Solutions00:09:10Our adjusted operating income for the first quarter of twenty twenty five was $900,000 compared with an adjusted operating loss of $2,400,000 in Q1 twenty twenty four. The decrease in GAAP operating loss was primarily due to an increased revenue of $5,500,000 compared to the same period in the prior year. Our GAAP net loss was $400,000 or $01 per share in Q1 compared to $3,200,000 or $07 per share in the prior year. The decrease in net loss was primarily due to a $3,500,000 improvement in gross margin. Adjusted EBITDA for the first quarter of twenty twenty five was $5,700,000 or 24% of revenue compared with $2,600,000 or 14% of revenue in the prior year. Troy WichtermanCFO at BioLife Solutions00:10:01Adjusted EBITDA increased from the prior year primarily due to a $3,500,000 improvement in gross margin driven by increased sales of biopreservation media. Turning to our balance sheet. Our cash and marketable securities balance reported as of 03/31/2025 was $107,600,000 compared with $109,200,000 as of 12/31/2024. Taking into consideration our adjusted EBITDA of $5,700,000 in Q1, cash usage was primarily driven by unfavorable working capital of 3,200,000 debt principal payments of $2,500,000 and capital expenditures of $1,000,000 Our SVB long term debt balance at quarter end was $12,500,000 We expect to continue making quarterly repayments of $2,500,000 going forward. Turning to our 2025 financial guidance, which we are affirming our original guidance from our Q4 earnings call. Troy WichtermanCFO at BioLife Solutions00:11:06Total revenue is expected to be $95,500,000 to $99,000,000 reflecting an overall growth of 16% to 20%. Our cell processing platform is expected to contribute $86,500,000 to 89,000,000 or 18% to 21% growth over 2024. Our EVO and THOP platform is expected to contribute $9,000,000 to $10,000,000 or 3% to 15% growth over 2024. We expect adjusted gross margin for the full year to be in the mid-60s, a reduction in GAAP net loss and expansion in adjusted EBITDA margin in 2025 due to higher expected revenue, partially offset by increases in R and D expenses related to development projects and an estimated $1,000,000 in R and D related expenses from our Panthera acquisition for the balance of 2025. We do not expect any material revenue from Panthera in 2025. Troy WichtermanCFO at BioLife Solutions00:12:09Finally, in terms of our share count, as of May 1, which includes shares issued from our Panthera acquisition, we had 47,600,000.0 shares issued on outstanding and 50,100,000.0 shares on a fully diluted basis. Now I'll turn the call back to the operator to open up for questions. Operator00:13:00And the first question comes from Matt Stanton with Jefferies. Please go ahead. Matthew StantonAnalyst at Jefferies00:13:06Hey, thanks for taking the question. Maybe Rod first for you. I appreciate all the color on the progress on the commercial side of the business, but maybe just to focus a little bit on the non commercial and more clinical side of the business, which is the other 60 or so. Can you just kind of talk about level of visibility into trends there? What you're hearing from customers? Matthew StantonAnalyst at Jefferies00:13:26Obviously, there's no shortage of headlines around the FDA funding and things like that. Maybe it's a bit of have and have nots on the funding side, but just a little bit more clarity or update on what you're hearing and seeing in terms of demand trends and patterns from that clinical side of the business today? Thanks. Rod de GreefChairman & CEO at BioLife Solutions00:13:44Sure. The clinical customers that buy direct from us, actually came in reasonably well for the quarter, right? So we don't really see anything in the near term at that point. It's not a significant up. The growth for the quarter was definitely driven by our commercial customers. Rod de GreefChairman & CEO at BioLife Solutions00:14:06Where we would see the majority of any kind of impact from the issues you're raising here would be on the distribution side. And while we don't have perfect visibility to the customer segmentation of those distributors, distributors came in the two large ones in particular, came in as we had expected. So right now and we're in contact with them on a pretty regular basis, couple of times a month. Last week, I sat in on our quarterly business review with our largest distributor, also our largest customer, and they're not signaling any sort of slowdown in demand at this point in time, although they're clearly aware of the potential impact of, let's say, NIH funding cuts. I think the potential for delays relative to changes and cuts at the FDA, I think that's going to play out over a longer period of time as opposed to this quarter, next quarter, if it plays out at all. Matthew StantonAnalyst at Jefferies00:15:06Great. That's really helpful color. And then maybe just on the Panthera deal, maybe you can talk a little bit about more why it makes sense, proof points we can expect going forward. You obviously had kind of a front row seat there the last few years with your involvement in the asset prior. And what does the team bring you today that you didn't have before? Matthew StantonAnalyst at Jefferies00:15:24And is there kind of a product pipeline where you have the opportunity to layer some of the stuff they've been working on into your existing offering? Thank you. Rod de GreefChairman & CEO at BioLife Solutions00:15:35Yes. I think that from a timing perspective, the reason we did this now is because they had demonstrated proof of concept with their first generation molecules. So we felt comfortable that the fundamental technology worked. And what we wanted to do was be in a position to be able to very completely control the future development of the next gen molecule so that the focus and all of the effort from a scientific perspective was in combining that next gen molecule with our CryoStor product line. So that's what the focus is for the next eighteen months. Rod de GreefChairman & CEO at BioLife Solutions00:16:11And I think as we've said, really the opportunity for us is to have a next gen line of cryopreservation products, which can do one of three things, if not more than one of those three things combined. One would be having just a cryopreservation product that has more efficacy in general with maybe some different types of cell types. The other is to have the same efficacy but with potentially lower concentrations of DMSO, which some customers have signaled as important to them. And then I think the third opportunity really is to create a product that would allow us to cryopreserve cells and tissues that could be held and transported at minus 80, so that's a dry ice kind of temperature range, versus minus 196, which would be LN2. So the logistics around LN2 transportation and storage are significantly more sophisticated than dry ice shipments. Rod de GreefChairman & CEO at BioLife Solutions00:17:16So from a scientific team, we added two very experienced, very well regarded scientists. What that does is not only just backfill from a risk mitigation perspective, given that we had a very small team of one or two folks, depending on how you want to look at it, but it also allows us to increase the throughput of the scientific experiments that are going to be done here in the next twelve to eighteen months. Matthew StantonAnalyst at Jefferies00:17:43Thanks. Appreciate it. And congrats on the strong quarter. Rod de GreefChairman & CEO at BioLife Solutions00:17:46Thank you. Operator00:17:49And your next question comes from Paul Knight with KeyBanc. Please go ahead. Paul KnightManaging Director at KeyBanc Capital Markets00:17:54Hi, Rod. Hi, Troy. Congrats on the quarter. Rod, where are you in the pricing journey that you are on? I know that you're working on across the board changes. Paul KnightManaging Director at KeyBanc Capital Markets00:18:12Are you half done, a third done? And does this happen over what three years? Rod de GreefChairman & CEO at BioLife Solutions00:18:17Yes. We're more than half done Paul on sort of the four or five key customers that had significant legacy discounts that are not applicable to the world we are in today. Some of them kick in, one large one kicks in, in the second half of the year just based on their own fiscal year and just the negotiations that took place. And they are, for the most part, given the magnitude of the clawback of the discounts, they are spread out over a thirty six month period on an annual basis. So we'll see a bit of a tailwind there over the next three years. Paul KnightManaging Director at KeyBanc Capital Markets00:18:55And then last question would be, how does the pipeline on M and A look? Rod de GreefChairman & CEO at BioLife Solutions00:19:04We are definitely looking at a few things, Paul, but we have a pretty strict filter criteria. We are in the process of actually working through a more robust sort of strategic technology summit, if you will, that's coming up here internally, which will include a couple of our directors, Tony Hunt being one of them, so that we have a very clear and tight filter criteria as we look at things going forward. That said, there are a couple of things, small tuck ins, not dissimilar to Panthera as it relates to how they would fit on the horizon. Paul KnightManaging Director at KeyBanc Capital Markets00:19:45Okay. Thanks. Rod de GreefChairman & CEO at BioLife Solutions00:19:47You bet. Operator00:19:52And your next question comes from Chad Witrowski with TD Cowen. Please go ahead. Chad WiatrowskiVP - Equity Research at TD Cowen00:19:59Hey, this is Chad Witrowski on for Brendan Smith. Was the limited impact from sort of tariffs NIH funding more of caused by maybe limited exposure or did you have to take steps like with your global distributors to sort of insulate yourself from some of that and maybe from a manufacturing standpoint? And just in general, what about that sort of 14% exposure to European revenues? Rod de GreefChairman & CEO at BioLife Solutions00:20:29Yes. Thanks, Chad. I think that when we did our analysis internally here around tariffs, and NIH cuts, we really looked at the tariff side of it between suppliers first and then customers. So on the supplier side, all of our products for cell processing revenue are manufactured here in The United States, and we have very little exposure to foreign raw material inputs. So we're pretty comfortable that there's not going to be any impact on our cost of goods, certainly not any material impact on our cost of goods at this point in time. Rod de GreefChairman & CEO at BioLife Solutions00:21:04If that were to change, we would go ahead and implement some sort of surcharge program, which we did with respect to the freezer businesses we owned during COVID. On the customer side, on the direct customer side, which represents about 60% of our revenue, we also think we have very little exposure, almost no exposure to China. So we do have exposure to Europe, But we believe that the product that's being sold into Europe Direct is primarily sold to customers that are in late stage clinical and or have a commercial therapy that is already for the most part manufactured there. So our product is such a critically enabling tool for the development of their therapies that we don't believe a 10% or 20% tariff on our product is going to make a bit of difference in terms of their utilization. It's certainly not going to be enough to make them think about switching. Rod de GreefChairman & CEO at BioLife Solutions00:22:05So we're pretty comfortable with the customers on the direct side. We do have some greater exposure on the distribution side, but we've been spending a lot of time in particular with our largest distributor, again, largest customer, understanding their exposure to China, which is more than ours by a bit. And their view on the Chinese exposure from their perspective is that they expect the Chinese government to either exempt and or subsidize these particular products so that they're protecting their own biotech industry. That's number one. For the rest of the world from a distribution perspective, they also feel that the incremental amount or increase in cost of product relative to tariffs would be relatively de minimis to those customers. Rod de GreefChairman & CEO at BioLife Solutions00:22:57And therefore, they, to date at least, have not changed their rolling twelve month forecast for us. Although I can tell you it's something that we're in constant conversation with them, probably two times a month. Chad WiatrowskiVP - Equity Research at TD Cowen00:23:10Really helpful color, Rod. Thanks. Rod de GreefChairman & CEO at BioLife Solutions00:23:13You bet. Operator00:23:17And your next question comes from Thomas Flaten with Lake Street. Please go ahead. Thomas FlatenSenior Research Analyst at Lake Street Capital Markets, LLC00:23:22Hey, good afternoon guys. Congrats on a great quarter. Hey, Rod, just to follow-up kind of on a prior question with respect to the pipeline for M and A. Obviously, you've got a nice little cash hoard at this point. Any other big projects we should be aware of CapEx, facility build outs other than M and A that we should be thinking about? Rod de GreefChairman & CEO at BioLife Solutions00:23:42Yes. I think we definitely are in the process of planning. So I think I may have mentioned on a previous call that we have leased earlier this year, we leased the Third Floor of the building that houses our current manufacturing, which is on the First Floor. So that gives us an additional $75,000,000 or so of capacity with respect to biopreservation media. So that's a sub-ten million dollars kind of investment, more like 5,000,000 to 6,000,000 when you net it with the TIs. Rod de GreefChairman & CEO at BioLife Solutions00:24:13So the larger CapEx project is in Indianapolis, where our lease runs out in the facility that we're in and have been in for a number of years. So we're in the process of identifying another facility. We will be building out a clean room for the manufacturing of HPL, which is what we do in Indianapolis. And also plan on doing the fulfillment of all of our products from a business continuity standpoint, keeping our nine months of finished goods inventory there in Indy. So that will be a larger CapEx expense, but it's really a 26,000,000 event as opposed to 25 Thomas FlatenSenior Research Analyst at Lake Street Capital Markets, LLC00:24:54quick one on revenues. Anything we should be cognizant of now that we've shed the other businesses in terms of seasonality pacing of revenues across the balance of the year? Troy WichtermanCFO at BioLife Solutions00:25:04Yes. We don't really have much seasonality in our business in general. Summer months can be a little bit slow in Europe, but other than that, we don't have much of an impact for seasonality. Thomas FlatenSenior Research Analyst at Lake Street Capital Markets, LLC00:25:14Got it. Thanks guys. Rod de GreefChairman & CEO at BioLife Solutions00:25:16Thank you. Operator00:25:20And your next question comes from Matt Hewitt with Craig Hallum Capital Group. Please go ahead. Matthew HewittSenior Research Analyst at Craig-Hallum00:25:27Good afternoon. Thanks for taking the questions. Maybe circling back to the Panther acquisition, I think if I heard you correctly, you're looking at least eighteen months before you could see some revenues there. But I'm wondering how difficult or is it feasible that a customer could swap out the Panthera media in for their existing media? Is that something that can happen that you could see maybe even a commercial program already using a media swap yours in, specifically the Panthera? Rod de GreefChairman & CEO at BioLife Solutions00:26:00Yes. So good question. Last year, we did do we engaged with a third party consulting group that has expertise in CGT and we posed the question to them, what is the switching cost for CGT manufacturer to swap out the biopreservation media? And it was clear that as you go down further down the clinical pipeline, so let's say, clinic Phase III or commercial product, it becomes a very big hurdle. And by that I mean several million dollars and a couple of three years to do so. Rod de GreefChairman & CEO at BioLife Solutions00:26:36So it's unlikely that we would have any companies that have a product in the market switch out in part because the product works well for them today. So really the opportunity lies in to some degree the clinical pipeline of those commercial customers. And what we're finding out is those are pretty robust in terms of number of clinical trials. And the other would be then to move to the early part of the funnel and start to introduce that technology in the Phase one or preclinical timeframe, where we have a much easier job of swapping something out. Matthew HewittSenior Research Analyst at Craig-Hallum00:27:14Makes sense. And maybe separately regarding tariffs, on the off chance that you do start to face some headwinds there, do you have the ability to pass the tariff cost on to your customers via your current contracts? Or is that something that you would have to negotiate or figure out at that point? Rod de GreefChairman & CEO at BioLife Solutions00:27:36Are you speaking to tariffs that might be attached to raw material inputs and therefore increasing our cost of goods? Matthew HewittSenior Research Analyst at Craig-Hallum00:27:44Correct. Rod de GreefChairman & CEO at BioLife Solutions00:27:46Yes. So I think that, yes, the answer is we would if there's anything material, we would go ahead and put a surcharge on it for our customers. As I said, we have done that in the past. There's nothing in our supply agreements that prohibits us from doing that. Obviously, we'd want to be pretty judicious about that. Rod de GreefChairman & CEO at BioLife Solutions00:28:07But we would do it if it turns out to be a material increase in any way to our own COGS. Matthew HewittSenior Research Analyst at Craig-Hallum00:28:13Makes sense. All right. Thank you. Rod de GreefChairman & CEO at BioLife Solutions00:28:15Thank you. Operator00:28:19And your next question comes from Carl Byrnes with Northland Capital Markets. Please go ahead. Carl ByrnesManaging Director at Northland Capital Markets00:28:26Congratulations on the results on the quarter. Most of my questions have been answered. I'm wondering if we can go back to Panthera in terms of what you expect the incremental OpEx would be. I'm imagining, as you mentioned in your prepared comments, most of it's going be in the R and D line. Thanks. Troy WichtermanCFO at BioLife Solutions00:28:42Yes, that's correct, Karl. To the tune of about, call it, dollars 1,000,000 for the remaining nine months of the year. Carl ByrnesManaging Director at Northland Capital Markets00:28:48Okay. That's what I thought you said, but I wanted to check. Cool. Excellent. Congrats again. Carl ByrnesManaging Director at Northland Capital Markets00:28:52Thanks. Troy WichtermanCFO at BioLife Solutions00:28:53Thank Thank you. Operator00:28:57And your next question comes from Yi Chen with H. C. Wainwright. Please go ahead. Yi ChenManaging Director & Senior Analyst at H.C. Wainwright & Co., LLC00:29:05Thank you for taking my question. Just curious, is BioLife likely to benefit at all from pharmaceutical and biotechnology manufacturing onshoring due to tariff over the course of the coming quarters? And if so, to what extent? Rod de GreefChairman & CEO at BioLife Solutions00:29:23Yes. It's a fair question. Rod de GreefChairman & CEO at BioLife Solutions00:29:25I think it's very early to try to quantify anything. Again, I think you got to remember that our product is an incredibly small part, and by that I mean probably less than 1% of a CGT manufacturer's cost of goods. So the fact that they're manufacturing product abroad and then importing their cryopreservation for the drugs that are being sold in say Europe or Asia, I just think it's a de minimis amount and it's just simply not an issue at this point as far as we can see. Yi ChenManaging Director & Senior Analyst at H.C. Wainwright & Co., LLC00:30:02Got it. Thank you. Rod de GreefChairman & CEO at BioLife Solutions00:30:04Thank you. Operator00:30:08This concludes our question and answer session. I would like to turn the conference back over to Roderick DeGreef for any closing remarks. Rod de GreefChairman & CEO at BioLife Solutions00:30:17Thank you, Mike. In closing, the first quarter positions us well for the year ahead. We remain confident in our ability to navigate potential headwinds with minimal impact to our financial results. Thank you for your time this afternoon and we look forward to updating you as we move through the year as well as seeing some of you at investor conferences later this year. Operator00:30:43The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.Read moreParticipantsExecutivesTroy WichtermanCFORod de GreefChairman & CEOAnalystsMatthew StantonAnalyst at JefferiesPaul KnightManaging Director at KeyBanc Capital MarketsChad WiatrowskiVP - Equity Research at TD CowenThomas FlatenSenior Research Analyst at Lake Street Capital Markets, LLCMatthew HewittSenior Research Analyst at Craig-HallumCarl ByrnesManaging Director at Northland Capital MarketsYi ChenManaging Director & Senior Analyst at H.C. Wainwright & Co., LLCPowered by