Good morning and welcome to the Bio-Techne Earnings Conference Call for the Third Quarter of Fiscal Year 2021. [Operator Instructions] I would now like to turn the call over to David Clair, Bio-Techne’s Senior Director Investor Relations and Corporate Development.

Good morning and thank you for joining us. On the call with me this morning are Chuck Kummeth, Chief Executive Officer and Jim Hippel, Chief Financial Officer of Bio-Techne. Before we begin, let me briefly cover our Safe Harbor statement. Some of the comments made during this conference call maybe considered forward-looking statements, including beliefs and expectations about the company’s future results as well as the potential impact of the COVID-19 pandemic on our operations and financial results. The company’s 10-K for fiscal year 2020 identifies certain factors that could cause the company’s actual results to differ materially from those projected in the forward-looking statements made during this call. The company does not undertake to update any forward-looking statements as a result of any new information or future events or developments. The 10-K as well as the company’s other SEC filings are available on the company’s website within its Investor Relations section. During the call, non-GAAP financial measures maybe used to provide information pertinent to ongoing business performance. Tables reconciling these measures to most comparable GAAP measures are available in the company’s press release issued earlier this morning on the Bio-Techne Corporation website at www.bio-techne.com. I will now turn the call over to Chuck.

Thanks, Dave and good morning everyone. Thank you for joining us for our third quarter conference call. As you read in our press release earlier this morning, I am very pleased to announce that the Bio-Techne team delivered again another strong quarter in our fiscal Q3. Our year-over-year organic growth accelerated 22% for the quarter as we continue to build on momentum from the first half of our fiscal year. This growth was the best organic growth the company has delivered in over 25 years both year-over-year as well as on a 2-year CAGR basis. As it has been all year, the growth in Q3 was broad-based across our segments and geographies as penetration into biopharma remained very strong and continued improvement in academia drove the year-over-year and sequential acceleration in our business. The growth between our product categories was also broad-based with most accelerating sequentially from Q2 and continued by leadership from our Simple Plex, Simple Western, cell and gene therapy and genomics platforms. As we have been doing all year, we delivered our record organic growth with a focus on profitability, achieving 40.1% adjusted operating margin for the quarter. The timing of hiring to support growth investments, combined with COVID-restricted travel, once again benefited our profitability. However, our positioning in high growth markets, with high gross margin products has strengthened the conviction in our ability to sustain 40% operating margins in the future pursuant to our strategic plan. Before we dive deeper into our Q3 performance, I would like to welcome the Asuragen team to Bio-Techne. As a reminder, we announced the Asuragen acquisition in early March and closed the transaction in early April. Asuragen adds a portfolio of leading genetic carrier screening and oncology research products and diagnostic kits complements our legacy clinical controls business with molecular…

Thanks, Chuck. I will provide an overview of our Q3 fiscal 2021 financial performance for the total company, provide some additional details on the performance of each of our segments and give some thoughts on the remainder of our fiscal year. Starting with the overall third quarter financial performance, adjusted EPS was $1.79 versus $1.39 1 year ago, an increase of 29% over last year, representing a new company record. Foreign exchange negatively impacted EPS by $0.04. GAAP EPS for the quarter was $1.12 compared to $0.92 in the prior year, representing a 22% increase year-over-year. Q3 revenue was $243.6 million, an increase of 25% year-over-year on a reported basis and 22% on an organic basis. Foreign exchange translation had a favorable 3% impact on our revenue. All geographies had strong growth in Q3, led by China growing nearly 50%, followed by EMEA with over 30% growth and in the Americas with growth north of 20%. The rest of the world grew in the low teens. You will recall that last year was the start of a pandemic, which severely hit China and, to a slightly lesser extent, Europe in our Q3 fiscal year ‘20. Our business in the U.S. was not materially impacted by pandemic shutdowns until April of last year. Hence, the comps in Q3 this year were easier in China and Europe than the U.S. That being said, China’s revenue in Q3 of this year was still nearly 60% higher than the same quarter in fiscal year ‘19, and Europe’s revenue was over 20% higher than Q3 of fiscal year ‘19, while the Americas revenue is up over 35% from the same quarter in fiscal year ‘19. By end market, biopharma continues to be very strong with year-over-year growth well over 25%, while academia continues to make…

[Operator Instructions] Our first question is with Dan Arias with Stifel. Please proceed with your question.

Hi, guys. Good morning. Congrats on the performance that you are seeing here. Very strong. Can you just talk a bit about the early days of servicing your customers with the expanded GMP capabilities? Are you seeing the orders come in the way that you had hoped and then how should we think about building out the portfolio there? And the reason I ask is because if I am thinking about the situation right, it sounds like one of the key factors that will influence the ramp will just be the pace of expansion of the catalog? So, can you just sort of touch on growing the product set there such that you feel like that will be less of a limiting factor than it might be in the near-term?

Yes. I will start kind of from the back forward. It won’t be a limitation of the catalog. We have got the most full GMP catalog already in the world. It’s just a matter of qualification and getting in inventory. So, the issue is all commercial and it’s all waiting for this industry to really happen. So we have had a really good quarter. We are further along with a dozen or so customers. We have talked about a couple of we have locked in already. It’s hard for them to talk about forecasts and numbers and stuff. So we’ve contracted in terms of percents, and we’ve had no issue with contracting at 95% of their needs, whatever their needs be. And I have talked in the past about they range anywhere from $10 million a year to over $50 million of just like a single protein. So we’re making progress. We’re also getting help because with ScaleReady out there, we have got a dozen different people in commercial between sales and technical. They are starting to drive more interest and awareness, and that’s also helping find our way to more potential business more quickly. It’s still a J curve like we have talked about. I mean – so you’ve been keeping track of the model, and we’ve been talking about the growth rate. So you can do the math and you will see that we’re at a $15 million, $16 million run rate right now at GMP proteins. I’ve talked in the past that even on this site here, Minneapolis headquarters, we can make as much as $40 million. So we’ve got plenty of time here before we exhaust our capacity before we have to have this factory turned on. And we’ve slipped a couple of months, but we’re…

Okay, helpful. And then maybe just moving over to Simple Plex, I mean, you are going to be rounding out a pretty big year there. How are you feeling about carrying that strength into next year? My initial thought a couple of quarters ago was that a lot of those systems were being driven by COVID, but it also sounds like cell and gene and some unrelated areas are in – at least been right there?

You may have noticed that our numbers are even bigger this quarter. So we have found ways to make more. We’ve been throttled because of just we couldn’t make anymore. It’s hard to grow an instrument business at 90%. So talk to anybody. And now we have also beefed up our cartridge lines. We have more flexibility. We keep expanding our analyte lines, so the things that go in the cartridges for the customers. So we are giving them more flexibility, but it really comes down like I said, it’s biomarker discovery. It’s QC applications. It’s being looked at and being highly received by cell and gene therapy applications. So, all these things are way beyond our expectations 4 or 5 years ago. And then there are diagnostics applications that we really are just getting started on. We’re in the middle of a 510(k) per process. Of course, we’ve got the partner in China, and they’re going through their own. So this thing is one of the big sleepers of our company and we’ve got to get a new building. We have got to expand capacity. It’s more than just adding shifts. We are all over this, right up there with exosome being the number one – number two priorities in the company, and we expect momentum to continue. We are now well over 500 boxes out there. That’s kind of a tipping point where things start selling themselves. People start seeing them. The word of mouth gets out. Just like we did with Simple Western a couple of years ago, there was a tipping point where it just got a lot easier and we are reaching that point now with Simple Plex.

Okay. And just I guess a simple way of thinking about it would be to say that if you are expanding manufacturing the way that you are there, then obviously you have got a decent line of sight into some out-year demand that should pickup?

Yes. And I think you got to look at the competition here is Quanterix and they have done a good job. I just read their print this morning and they beat as well. It just speaks to the need what this industry is opening up. There is a need for highly sensitive multiplexing immunoassay systems. And right now there is only a couple of really good ones out there. It’s kind of us and Quanterix that are sensitive enough and ours just happens to be about one-tenth the size and one-tenth the price and still highly sensitive. So we are catching up to them, but I think there is room for both of us. I think it’s a really expanding market for all these different applications I just mentioned. It’s kind of unknown. It’s just – it’s going to get big.

Yes, okay. Okay, thanks Chuck.

Our next question is with Puneet Souda with SVB Leerink. Please proceed with your question.

Hey, great. Thanks. Thanks, Chuck. So first of all, congrats on a strong quarter here, great to see the strong growth and really impressive operating margin here. The key question is how sustainable is that? And Jim addressed some of that is based on what you expect to see here in the fourth quarter, but given the sort of the pent-up demand that’s already there, the reagents and consumables, which are more easier to order and if you look back into the sort of the second half of the calendar year or the next fiscal year, obviously comps get tougher. So, maybe just speak to us in terms of how long of a sort of sustainable tail that you see here?

Yes. Well, first of all, we put a pretty key phrase in the commentary from Jim. We talked about revenues being similar in Q4 to Q3 on a dollar basis, when you do the math, that’s a big growth rate, that’s going to give us something north of 20% if we hit that and momentum looks very strong right. So, whether you talk about for the year or take it for 2 years, it’s double-digit for 2 years too almost teens. So – and then you got to talk about, well, we are hitting on all cylinders. Everything is growing amazingly well. It speaks to the industry. It speaks to the funding. It speaks to us crossing all these tipping points as a company. It speaks to our digital presence and our investments and just the awareness of our company and our platform. The quality has always been there in a lot of our brands, but we are expanding it. It speaks to us being able to entice companies to come on board like Asuragen. I don’t think we could have talked them they come on board 3, 4 years ago. They see the candy in the store, and they want it. They want to help out. So we see in the Q1 and Q2 and our further next year, probably is not a 20% year, but it’s going to be strong. And right now, it’s too early to talk about what that could be. We’ve listened to all the other peers out there, and everyone is staying kind of shy about next year. Comps are going to be tough, but you got to look at the market indicators. They are crazy good and we are going to be good.

Puneet, I would just add, I think we’re a bit beyond the point of pent-up demand. I think at the end of our Q2, we had a 19% quarter. We had some questions among ourselves to how much that might have been some pent-up demand. But I think by the time we get here into Q3, that’s no longer the case. What we’re seeing is a really sustainable run rate. In fact, if anything, the momentum accelerated throughout Q3 as opposed to leveling off or sloping downwards. So I don’t think it’s pent-up demand at this point. I think it’s ongoing funding.

Got it. And then, Jim, on operating margin, you are suggesting that these are sustainable in the near-term, but how are you thinking about those longer term given the level of investment that you want to do in the business? And obviously, you have done successful acquisitions here in the past and so how should we think about that operating margin profile longer term?

Yes. So, if that’s how you define long-term and short-term, but I think the message I am trying to convey here is that the fact we were able to hit 40% well ahead of our – well ahead of schedule, some of it for some reasons that like travel and things like that were unforeseen a couple of years ago. But the point being is that we have a highly profitable business model and it shows that we can get to 40% and we have that much more confidence we can get that on a sustained basis going forward in the long-term. In the short-term, we need to catch up on some investments and that short – that catch up on investments will bring that rate down for a while in the short-term until we grow back up and get back to 40%.

But still on plan for our previous guidance.

I would argue ahead of plan.

Ahead of plan.

So, I think compared to fiscal year ‘19 and definitely compared to fiscal year ‘20, we are well ahead of plan on that trajectory. Things look good. We are getting great leverage. And we have – this quarter was a lot more investment than in the previous quarter. So, we have got great leverage as you saw in our numbers off of our scale and that’s going to continue.

Okay, okay. That’s very helpful. And Chuck, on proteomics obviously proteins are very much core to you, great to see the growth here in Simple Plex and all the platforms and ProteinSimple. And when you think about the antibodies portfolio that you have, the combination with Simple Plex, how are you thinking about proteomics now? Obviously, there – in linker technologies, Olink and others that are emerging on the market after MERS and other approaches that are coming onto the market, so how are you thinking about proteomics overall? Are there opportunities that you think where you can potentially expand into and how do you see the benefit flowing from that to – broadly to the antibodies portfolio?

Don’t forget, most of these people you mentioned are also our customers, first off – first and foremost. And we enjoy great relationships with almost anybody in the field of proteomics. I think the core underlying growth level for just on the basic research is phenomenal. I do think that avenues like Soma and Olink are high-plexing kind of different niche, high-value applications that drive a lot of value and – but I think we will reach into those spaces as well to work with them and probably compete with them, but we will be never giving up our core and we will be king of the core in terms of antibodies and proteins for some time to come I think.

Okay. And then last one, if I could squeeze in on Asuragen. Obviously, a very interesting asset and it appears to be Intel inside for the – some of the NIPT assays. So just getting – I wanted to get your sense on the contribution this year and sort of next year if anything you can provide there, that would be very helpful? And we expect this to be April 6 close, so I suppose it’s going to add to the next quarter, too? Thank you.

Yes. So Puneet, in my comments, I addressed what we thought I would add for Q4, roughly 2% to 3% revenue on top of our base – of our core business for next quarter. Minimal EBITDA contribution, they just broke into profitability, and we will provide more guidance as to what that might mean for fiscal year ‘22 as we wrap up our Q4 earnings call next quarter.

I think what you got to remember is they are – they have got a great pipeline there, about to launch a trio of new assays along when you get the cystic fibrosis out and that – we’re seeing that as a potential home run. So it’s a – they have got great credibility. They are known for great quality there. In some cases, their indications are unique. In some cases, they have got competition, but we seem to be best-in-class. So stay tuned. I think as we launch these new things in their pipeline, which is really imminent over the next few months to a year, you’re going to see some immediate help and support. And we’re not used to buying companies that are already in the black to begin with. So this is all good.

Got it. Thank you. And yes, clarifying that was more carrier screening in that versus NIPT. Thanks for the comments, Chuck.

Our next question is with Jacob Johnson with Stephens. Please proceed with your question.

Hi, thanks. Good morning everybody. Maybe first, just a broader question on Dan’s on cell and gene therapy. Chuck, I lost count on the number of times you mentioned cell and gene therapy in your prepared comments. Can you just remind us the size of the end market across the portfolio today, what this could be in a few years? And then are you seeing more applications for this end market across your portfolio outside of things like GMP proteins, TcBuster? It seems like you are.

Yes. You’re right, Jake, we probably overdid it, but it is a pretty exciting area for us, and it starts really paying for us in a year or two out here. But right now, it’s on about a $50 million run rate across all our portfolio, and that’s – probably, we still are a little bit dark on just what potential is coming on with ScaleReady, but our TcBuster is really starting to land a lot of deals, starting to become significant. You already know the fabulous growth in GMP proteins, but we also have media that’s really growing well as well and other things. So we see it as a $500 million plus market within 5 years for us is addressable, to be honest. And then, as we talked, we alluded to all the different synergies across the company, they are just – there is a lot of unknowns. We have put in place a – as you know, the company we designed here as a team is a subsidiary model, multinational model. We have five divisional businesses right now, six, if you want to call Asuragen one. We will probably do some synergistic work to get all the diagnostics platforms over the next year or two. But looking forward, it’s going to be 6, 8, 10 different divisions. They are going to be synergistic, and we run a tech console kind of process. We make sure all these scientists are actually working together. We have a strong pipeline of new things that nobody else can do because you add platform A to platform B, we have come up with new things that nobody else can do because they don’t have all the things together. This goes back to my past and a lot of other people’s past in this company and to some fabulous companies we come from. Innovation rains supreme here. And I – we probably over said cell and gene therapy, but it is probably the most exciting future market for our company. We have– in terms of size, I think – I still think exosome as a platform is the biggest potential, but it’s going to take years to really get all these things through because it’s just so much more regulatory aligned with most of those. But we’re really excited there, too. Don’t be surprised in a year or two, you see ExoTRU lap prostate. I mean the ExoTRU is just – there is crazy interest in it, and we’re doing really well, as you saw in our report, so...

Got it. Thanks for that. Chuck and I’ve probably been called out for saying cell and gene therapy too much as well. So we’re in the same camp there. And the other question, Chuck, my second one, just the last two quarters, I think you’ve called out robust growth in custom products and proteins. Can you just remind us how much of proteins is custom work? And maybe just talk about the kinds of customers that demand those custom products?

Yes. It’s as much about custom antibodies. We have a custom group. It’s really a great development situation for our leaders. We’ve taken some of these people who worked in those areas because they are very strong technically, but they have to be very articulated with customers, etcetera. And they turn out being great businesspeople – technical businesspeople. So we’ve been going into that camp. That said, it’s roughly under $20 million. We don’t want it too big because we got a – it’s hard to scale everything. If we can get things in the catalog, it’s great, but not everybody wants things in a catalog. They want them unique built for them. So we charge an awful lot to get access to our really great intellect. But it’s not something that we want to make a division or see a road map to $100 million, $200 million. I think the scalability issue around our custom model because its service is difficult. If I would tap too many of our star people and I’d rather have them working on products that we can sell to everybody.

Got it.

So – but it’s good. It’s very profitable. It’s very good. It’s growing very nicely. And it’s an incubator. It feeds into everything else we’re doing, so...

Okay. That makes sense. I will leave it there. Congrats on the quarter. Thanks for taking the questions.

Our next question is with Alex Nowak with Craig-Hallum Capital Group. Please proceed with your question.

Great. Good morning everyone. Chuck, one item that didn’t get any mention was the OneWeb. And as you look through the metrics there, are you seeing a big step-up, either increased traffic, increased cart sizes or just ways that research labs can put multiyear products together that fit into a solution, anything that can help explain the broad-based growth in the quarter?

Well, here’s the funny thing. We know it. You’re right, we’ve talked a lot about our digital presence and our investments in digital and SEO and how it’s driven a lot of our growth, and it’s explained a lot of our growth outside of our peers. And every time I talk too much about it, all my digital people come to me and say, you’re telling all our competition way too much. And they show me data showing that some of our competitors are actually paying for AdWords on Bio-Techne. They are buying Bio-Techne’s AdWords. So they are trying to creep it on our flow of customer contact. They are actually trying to lock up our own company name. So that was pretty clear to me that we’re certainly got their attention, and they are trying every avenue they can to get into our model because we’re taking share from everybody in our core areas, everybody. And because it’s working, right? If you look at our website lately, it’s phenomenal. And we just keep making it better. And the OneWeb is really – it’s really an umbrella term over really a complete one-basket approach to buying. And we’re not there yet, but we’ve made big improvements. So you can – where instead of – you saw many things we sell. I mean we continue to have an issue of demystifying and talking about all the different potential single unicorn platforms in this company, and yet can you buy them all together on one site, you couldn’t. Now more increasingly you can. And we’re not going to talk as much about it going forward because it’s one of our differentiators as a company. But it’s going very well. It’s clear by the numbers, right? So...

That makes sense. Okay. And then a ton of success in ACD right now. Is there really any new innovations or research-specific projects that are propelling that business unit forward? And then I guess to take a step back there, is it fair to put ACD in a similar position as ProteinSimple was maybe 5 years ago or would you say you don’t expect ACD to hit the levels that, that ProteinSimple is doing today?

To the contrary, I think that’s very prolific of you – prophetic. But there is RNAscope. There is BaseScope. There is DNAscope. There is HiPlex. There is XPlex. We’ve got a hell of a portfolio coming. And all of our new extensions of our platform are higher plex strategies. So also to be aware all the HiPlex guys out there, and they know it. You don’t need 0.5 million boxes with our technology. It doesn’t destroy morphology. There is a lot of benefits to the – to what we have, and we have strong IP protecting it. So no, we’ve always said this could be 200, 300 or more larger divisions. So it’s very much at a tipping point. It’s going to be knocking on $100 million next year, probably, real close, if not exceeding, and very profitable because at end of the day, it’s kits, right? Great gross margins. And the team is unbelievable. They are really good in terms of cross-linking other people in the company technically and getting help and also helping them, one of the strongest technical teams I’ve ever seen in my career, to be honest. And if anything, our issue is how do we keep acquiring talent in the Bay Area and keep this machine moving. It’s really competitive out there for people. And that’s probably the bigger concern is can we fuel the growth with more investment in key people.

I’d just add, Chuck, the recent launch of our DNAscope, the market for DNAscope basically doubled our addressable market from just RNAscope.

And we’ve been asked for it for you, very difficult. It’s probably about a year late because it’s just so technically difficult but we cracked it.

No. That’s great. Appreciate the update. Thank you.

Our next question is with Catherine Schulte with Baird. Please proceed with your question.

Hey, guys. Congrats on the quarter, and thanks for the questions. I guess, first, in the core reagents business, your last 5-year outlook had a 5% to 7% growth rate there. Can you just talk through some of the newer growth drivers that you’ve referred to earlier, whether it’s mRNA or proteomics, and the potential for those to be additive as you think about that next 5-year outlook?

Yes. And that’s very astute, and it’s true. I mean going back and even with us a long time, in the early days, we talked about getting into a healthy mid-single-digit growth and – because the markets aren’t really growing anymore in that anyway in terms of antibodies and proteins, even assays. But it’s not what’s happened, right? So the markets have all improved. There is a lot more funding out there. There is a lot of halo effect of stimulus. I’ve talked a couple of quarters ago about don’t be too worried about a 3% NIH budget. They are probably going to come back next year with something much bigger. Sure enough, they are talking 21% starting fiscal October. It’s going to be big. And this is without infectious disease. This is just oncology and neuroscience, the traditional funding from NIH. COVID is going to be another layer, and there is a halo effect of all of this. The vaccine mix, they are all buying. Everyone is exploding. There is a halo effect off of all that. And it all starts with proteins and antibodies and assays. What can I say? I think high single-digit growth at a minimum going forward, and we’ve been exceeding that, as you know, we kind of look silly, because we have been double digit here for quite a few quarters, so...

Alright, great. And then maybe on ExoTRU, I can see your excitement there. Can you just talk about your commercialization strategy and building out a sales force for the launch later this calendar year and maybe the time line for Medicare coverage?

My number one question is guidance, why don’t you start with that? So it’s a lot fewer barriers. We don’t have to worry about 20,000 urologists. We don’t have to worry about the pathologists that drive the urologists with being paid per sample off a biopsy. There is a lot of converting to do in Exosome Diagnostics. And we’re doing it. We’re growing and cranking. It’s going to be sticky, but it’s going to take some time. The ExoTRU, kidney rejection, there is only 100 centers. They are very regionally located. 85% of all the work is just in the top-tier of them. So this is why it’s important to have an at-home collection potential because a lot of these patients are going to actually traveling a lot every couple of months to get these – to get their new kidney checked, and now they don’t have to. Now they can send in urine. It’s simple. So we don’t have a big commercial plan. It’s going to be like a key account model. There is going to be a half a dozen different reps. We will probably hire some heavy hitters that are well-known in the industry and go to work. So – and right now, we got some good news, right? I mean we got MolDX offering up via – being CareDx as a solution. There is a lot more, I guess, acceptance of the LDT just in general for this issue of kidney rejection. And if we can get our – if we get NGS to abide by this opening, it’s going to actually accelerate our process, all this process. So we don’t know yet, but we’re talking to NGS, and they have been very supportive so far and very open and they are very, very interested. They like the data. They like the publication we’ve done already. And I’m hoping and expecting this will be a much smoother commercial transition than ExoDx was for prostate, to be honest.

As most transplant patients are covered by Medicare, you don’t have to worry about trying to convert a bunch of private payers.

Yes. 85%. So that’s another nice thing.

Yes, okay. And then last one for me, maybe on the Xencor agreement, how should we think about the time line for those antibodies, then move to clinicals and potential magnitude of milestones for those agreements?

Yes. Well, it’s unknown. As you know, working with therapeutic companies, you – they won’t tell you everything anyway. But we’re on our third different antibody. They are well along in the first one. I don’t know. All I know is that it’s – we’re getting paid upfront. We’re getting paid milestones. We get royalties. We hope that they are successful with their clinicals. But we don’t have their schedule for clinicals or what’s going on, but it certainly won’t be 6 months or a year or two, not sure, to see much come back from that beyond the milestone payments and everything else, but we have got a list. I mean we are – we have got quite a few of these going out. And it’s not $10,000, $20,000 here. We’re talking bigger – much bigger numbers upfront just to get access to our technology whenever you have to do that. And that’s becoming a nice new layer of new reps, as we mentioned.

Okay, thank you.

Our next question is with Patrick Donnelly from Citi. Please proceed with your question.

Hey, guys. Thanks for taking the question. Chuck, maybe just on ExoDx, obviously, you got a nice payer on board, I think, in the beginning of April. I know you’ve talked often about maybe if you get a big one, it’ll be the first of a few dominoes to fall relatively quickly. Can you just talk about the conversation pace since then with payers and what we should expect over the next couple of quarters and the flow there?

Yes. It’s certainly accelerating. We have much more – many more of the satellite Blue Cross Blue Shields now in the final throes of contracting with us. And of course, we’re still going after United and all other big ones. And it’s always – it always starts like this. One of the big ones has to go. And then eventually, the other one is not going to be left behind. And it gets to a point where patients are demanding it, right? So it’s going to happen. It’s way too good at technology. It works way too well, and we’re just going to keep grinding away at it. And it’s just too bad that this is a patient set that just aren’t leaving their homes and going to see their urologists and getting checkups. But they are coming back now, and our numbers are improving dramatically, as we mentioned, in March, for sure. And we’re getting there. I mean I think all in, from the beginning, we’re well north of 50,000 tests administered. So we’re – this is not – this is getting more than being a secret. So we’re getting there.

Right, okay. And then on the COVID side, I know you talked about a few different product lines that played into the mRNA vaccines. Are you able to quantify what the impact was in the quarter, even at a high level would be helpful?

Well, we had – as I mentioned, we had 90% growth, and some of that growth is mRNA. It’s vaccine related. I don’t even have a number in front of me. I don’t think it’s half or anything, but it’s just the component of the growth on all fronts, so...

Okay. And then maybe last one, just on a geographic basis. China has been a source of strength for much of the group here. Can you just talk through your performance there and then the outlook? Certainly, seems like things are moving up.

Well, as you remember, China fell off the table first, so they have the easiest comp, so 50% here being the number, and they are back strong, and the momentum is good. So we’re kind of back on track, level it all out or looking back a year or 2 where it’s a 25% grower, so at least 2022. We’re pushing them for ‘25, and I think that’s going to happen. We fared better than most last year in China where we still grew into single-digit growth as opposed to the typical 20% plus. So we had an easy comp for China, but not an easy comp compared to much of our competition in China.

Understood. Thanks, Chuck.

And we’ve been hiring there. The group is expanding. It’s kind of business as usual in China, to be honest, except for some of our management trying to get in to help. Basically, going through quarantine, it’s tough. And then there aren’t any Chinese extended visas yet. So you can only go in for 2 months and they kick you back out and you got to start over again. So no visits for a while for any of us.

Right. Thanks, Chuck.

Our next question is with Paul Knight from Janney Montgomery Scott. Please proceed with your question.

Hi, Chuck, you’ve emphasized how your catalog is the very best in a long time for any threat to it. Is it the annotation now that you have around it along with the content? How would you describe the barriers to your catalog now?

There really aren’t. I mean in the beginning – and you’re pretty up on this, I know, Paul, but IL-2 is kind of the first thing being sold. It’s probably still a leading protein being sold, and we make that as well. But we’re in the IL-7, IL-10, IL-15, and there is more. There is others. We have a catalog of roughly 50. Our competition is half to less than that. I’m just saying we have a strong catalog. We are not the largest GMP protein provider yet, but we will be.

Right. And the...

We kind of have to wait and see where these guys go with the process and the next spec and their next clinical. Are they looking for IL-27 or IL-37 or whatever? We have all the hardest to make proteins from research to kind of lead the way for the whole world following on what proteins come about when. How many of these become asked for or put in a GMP format is unknown. And to be honest, we will probably have to work with them. They’ll have to use us more than they have been if they want to understand the benefits of an advanced new protein that they don’t really understand or don’t know about because we will always have the most early information in the world on a new protein.

Is that also the profile of your St. Paul customer? Is it a technical product? What are they finding in your facility to book capacity?

Well, right now, it’s all about qualification. They want to see that – they know our R&D Systems brand is a high-quality protein. They want to see, instead of a couple of hundred thousand dollars of purchases for research needs, then they get $10 million of it at the same quality level, large lot, consistency and lot. And all the paperwork that has to go with it for being GMP, right, because it’s regulated. So they are coming and do audits and all that. It’s not really about checking us out if we can make the protein or not. They kind of get that. It’s more about all everything else. Can you make enough of it? Is it consistent? Have we done all the GMP regulatory stuff correctly? Do we have the bandwidth of the teams in place, the leadership? The typical audit stuff and it’s gone very well. And when you guys can start traveling again, you – we will bring tours. It’s a deal close a facility. It’s amazing.

Yes. And then lastly, there has been a lot of M&A in the industry with diagnostics assets. Are – is the pipeline – are the candidates out there much more attractive than they used to be due to maturity of the industry? What’s behind your M&A? What do you think is behind the activity in the industry?

Well, I think the growth for the industry is driving the activity. And now we’re going to have a bunch of very difficult comps, and a lot of companies with work chest of COVID cash, and so it’s going to drive a lot of M&A, I think, starting probably now, but certainly being the next fall. I mean start doing the math and what the big guys are now interested to have cash than anything. And they are not going to want to shrink that. They are going to want to grow. So they are going more M&A. If it turns out, we will be in there swinging like we always have. We’re not trying to compete with Thermo or Danaher. And Asuragen is a perfect example of yet another private deal we did, getting a great team, a bolt-on energy is in place and we will be able to grow much better with them than they would be on their own. We have certainly come in second and third on a few of the past year, some staying. I really wanted them, but we’re not going to overpay. And things are pricey right now. It’s just because that’s the industry we’re in, and people are demanding innovation and growth, and they can’t do it. It’s just classic make versus buy in the end, I guess. But it’s driving valuations. And the growth we’re seeing in our company – and we’re not the only one, right? It’s driving valuations as well.

Yes. Okay, thank you.

Ladies and gentlemen, we have reached the end of the question-and-answer session. And I would like to turn the call back over to Chuck Kummeth for closing remarks.

Alright. Well, thank you, Maria. It was a great quarter. What’s not to like with a 25-year record. So as you guys all know, Q4 should be even maybe more fun to talk about and I look forward to next quarter when we’re all together again. Thank you.

This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation.