Bio-Techne Corp at Robert W Baird Global Healthcare Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : And with your first couple of quarters in the CEO role, what are your been your initial takeaways set of priorities? And how are you thinking about imparting your own strategic vision on Bio-Techne?

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : Great. Really helpful overview. We're coming out of fiscal 4Q for Bio-Techne. That means you have the honor or the challenge of giving a 12-month forward outlook before some of your peers. So maybe at a high level, if you could walk through the fiscal '25 guide, the cadence work, organic growth, and some of the key end markets that you're focused on as a management team for that drive back to a more normalized growth environment.

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : Great. Let's take some of those items in turn, maybe starting with China. You've been messaging stability over the last couple of quarters. What are you hearing currently from your team on the ground in China? And if you could parse out the differences and what you're seeing from the core reagents versus the instrumentation portfolio.

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : And with some peers speaking to instrumentation pauses or maybe a pocket of softness as people wait stimulus details, would you continue to expect that kind of core reagent growth in the first half of your fiscal year in '25 ahead of any potential broader stimulus distributions in calendar '25.

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : I wanted to ask you about BIOSECURE given the recent movement here from the US House. Any impact to Bio-Techne's business specifically? And then maybe at a broader level, how you're thinking about the strategy and competitive positioning in China against the general or geopolitical backdrop. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies.

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : Got it. Let's maybe step back away from China and think about large pharma overall. We talked about pipeline prioritization, site consolidations, headcount reductions. What gives you confidence that the worst of these consolidations headcount reductions are behind you. We've got questions about if this could be an atypical cycle for pharma given some of the post-COVID normalization plus IRA. And maybe just at a high level, if you could walk us through the assumptions for large pharma budgets in calendar '25.

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : Got it. That's helpful. Maybe if we flip over to academia. What's your expectation for the next 12 months in terms of where budgets and funding sits for academic customers? And specifically, if you have any sort of geographic insights into differences between NIH funding or Europe, and then obviously, we've kind of spoken on China already.

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : Got it. I wanted to touch on the ProteinSimple portfolio. I think as a whole, the instrument portfolio has probably held up better than peers. What's driving the relative strength in the ProteinSimple portfolio? And what's the kind of biggest swing factor here in the next year or so in terms of getting back to that more 15%-plus kind of growth outlook that you highlighted at the Investor Day?

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : Got it. Well, maybe let's flip and turn to GMP proteins. You have the facility in place. You should have sufficient capacity for the medium term at the very least. Maybe at a high level, if you could frame the level of customer interest in the funnel that you've built here, what's your visibility around near-term demand? And how should we think about that customer funnel progressing from pre-clinical and into early clinical phases in terms of the revenue contribution over time?

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : Got it. Let's turn to diagnostics and genomics. ExosomeDx and EPI have been impressive growth story as you've gotten reimbursement in place and some of the commercial capabilities there. But you've started to talk more about the combined platform of ExosomeDx and Asuragen. So I wonder if you could comment about how you see those portfolios and capabilities coming together. And then maybe any near-term product launches -- I know you have the breast cancer test coming up later this year.

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : Got it. Let's flip to spatial biology. You did the Lunaphore deal a little over a year ago. I believe it's the most recent deal that you made. But why was COMET the right instrument for your portfolio? And give us a sense for the key competitors and competitive advantages that you see in your instrument platform.

Question: Tom Peterson - Robert W. Baird & Co. Inc. - Analyst : Great. Well, we've got about 15 seconds left. I'll sneak a quick one in on M&A. Jim, maybe to loop you in, just current thoughts on an M&A funnel valuations and just given the acquisitive history of how you're framing the opportunity set. James Hippel - Bio-Techne Corp - Chief Financial Officer, Executive Vice President - Finance Well, it's still a top priority for us on capital allocation -- what's helped build our company over the last 10 years, and we think we'll continue to build our company over the next 10 years. Very innovative space. So if you're not doing M&A, in my opinion, you're not -- you're going to fall behind. The funnel is -- it's always a plentiful funnel. The reality, though, is that the better assets out there are still wanting very high premium prices, particularly the private sector where we tend to play. And the less expensive ones are less expensive for a really good reason. So we're patient. We've been very diligent and strict on our financial measures and making sure we get the returns that our shareholders demand. And we'll continue to dance and develop relationships with many of these private sector companies out there that are innovative and building new products and come up with clever ways to partner with them and maybe help commercialize their products and things of that sort. But it will continue to be a strong part of our strategy going forward.