Bioplan USA Inc.

The negative outlook on Bioplan USA Inc. reflects our expectations that there will continue to be secular pressures in physical retail stores that could limit Bioplan's upside in the economic recovery post-COVID. Our outlook also reflects the risk that a weaker-than-expected operating performance could accelerate the company's cash burn. We could lower our ratings on Bioplan over the next 12 months under the following scenarios: Its term loans become current and it doesn't have firm plans in place to refinance its debt structure; or The company pursues a debt restructuring or exchange. While unlikely over the next 12 months, we could raise our ratings on Bioplan if it stems its revenue declines and continues to increase its revenue across its

... secular pressures affecting Bioplan's client base. Although the company holds a dominant position in the global sampling market, it has faced market share erosion from competitors through price-based competition and product differentiation. Furthermore, its client base is concentrated in the retail and CPG industries, which are all facing secular pressures and pursuing cost rationalization strategies. We view product sampling as a secondary marketing strategy for most of Bioplan's clients, making the company more vulnerable to changing marketing budgets and macroeconomic conditions. The COVID-19-sparked retail closures and reduction in marketing spend had a material effect on Bioplan's product volumes and accelerated its revenue declines in 2020. We expect the company to benefit from the economic recovery and anticipate higher marketing spend in 2021. However, this growth will likely be partially offset by continued secular pressures in physical...

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