Bio-Techne (NasdaqGS:TECH) FY Conference Transcript

Bio-Techne FY Conference Summary Company Overview - Company: Bio-Techne (NasdaqGS: TECH) - Date of Conference: November 18, 2025 - Focus: Discussion on financial performance, market trends, and growth opportunities Key Highlights Industry Performance - Pharma Market: - Continued strong performance with double-digit growth for three consecutive quarters, contributing approximately 30% of total revenue [2][10] - Recent pricing mechanisms by large pharma have appeased regulatory concerns, leading to a more optimistic outlook [11] - Spatial Biology Franchise: - Signs of recovery with low single-digit growth in consumables and double-digit growth in instruments [3][4] - Growth in China noted for the second consecutive quarter, with expectations for continued growth [3][17] - Biotech Market: - Despite a 30% year-over-year decline in funding, the market showed resilience with low single-digit growth [10][14] - Recent increases in biotech funding, with October showing an 80% year-over-year growth, indicating potential recovery [15] Financial Performance - Operating Margins: - Expanded by 90 basis points despite challenging market conditions, attributed to portfolio management and productivity initiatives [5] - Customer Dynamics: - Two major cell therapy customers received FDA Fast-Track designation, which may create short-term headwinds due to reduced material purchases but is expected to enhance long-term growth potential [4][22] Market Trends - China's Growth: - Regulatory environment favorable for Bio-Techne, with expectations for China to become a net contributor to growth over the next 12-24 months [17][18] - Local competition exists, but brand strength and product quality remain key differentiators [20][21] - Cell and Gene Therapy: - Anticipated headwinds due to customer purchasing dynamics, but long-term growth prospects remain strong with potential revenue from commercialized therapies estimated at $100 million [35][36] Future Outlook - Growth Projections: - Confidence in achieving low single-digit organic growth in FY2026 despite near-term challenges, driven by stabilization in pharma and academic markets [58][59] - Long-term potential for double-digit growth as market conditions normalize and cell therapy commercialization ramps up [62][64] Product Development - Innovations: - Introduction of advanced instruments and consumables, particularly in the spatial biology and protein sciences segments, expected to drive future growth [54][50] - Ongoing development of AI-generated proteins and integration of new technologies to enhance product offerings [30][40] Additional Insights - Market Positioning: - Bio-Techne's focus on quality and consistency in product offerings is crucial for maintaining competitive advantage in both domestic and international markets [20][21] - Customer Engagement: - Continuous engagement with customers to understand their needs and preferences is vital for product development and market penetration [20] - Long-term Strategy: - The company is positioned to leverage its growth pillars (cell therapy, spatial, ProteinSimple) to exceed market growth rates and achieve sustainable long-term growth [63][64]