Maravai LifeSciences Holdings, Inc. (MRVI) Earnings Call Transcript & Summary

[Audio Gap] Maravai LifeSciences Investor R&D Day. We're really happy to have you here with us in New York, and to those of you online, welcome. I would like to first introduce myself. I'm Deb Hart. I lead Investor Relations for Maravai. I think I've met most of you. I also want to point you to our disclaimers. We will be making forward-looking statements today, so please refer to our risk factors in our SEC filings. We also might refer to EBITDA figures. So we have reconciliations to any historic EBITDA on our press releases. We have an outstanding lineup for you today. Starting off with Trey Martin, who's our newly appointed CEO as of about 9 weeks ago. He's going to introduce the company. He's followed by Dr. Kate Broderick, who leads our innovation team, Chief Innovation Officer, and she'll talk about our customer-focused innovation road map. After Kate, we have leaders of our Nucleic Acid Production team. Drew Burch is our General Manager, Executive Vice President of Nucleic Acid Products. He'll be followed by Chad Decker, who is our Vice President, General Manager of Enzymes. And then Becky Buzzeo, who's our Chief Commercial Officer and also Chief Operating Officer of Nucleic Acid Services. We'll take a brief break then and then be followed by the Biologics Safety Testing team with Christine Dolan, who is our Chief Operating Officer of BST; Eric Bishop, Vice President, R&D of Cygnus; and David Cetlin, who is Executive Director, R&D, and also founder of MockV. We're going to take another -- excuse me, we'll round out those discussions with Kevin Herde, our Chief Financial Officer, who will provide a little bit of a financial background, insight into our capital allocation, and some long-term goals for the company. We're then going to take another brief break just to reset for Q&A, and have an engaging Q&A discussion. For those of you online, you'll have the ability to submit questions as well. So welcome, everyone. Before we get started, since Trey is new, I wanted to give a little bit of background on why we're so confident he's the right leader for Maravai. So Trey was #10 as an employee at Integrated DNA Technologies. He started there in their oligos synthesis lab, still in college. Pretty remarkable. He spent over 2 decades at IDT in progressing roles of responsibility, working under Dr. Joseph Walder. He spent over 2 decades as Chief Operating Officer there. He joined Danaher with the acquisition of IDT in 2018, served as President of IDT and Danaher before assuming the role of Senior Vice President, Genomics Medicine, where he led strategy development for mRNA, gene editing and gene therapy. So you can learn more about Trey as well as the rest of our stellar executives. We have bios in the appendix of the slides as well as on the web portal. So before I turn the meeting over to Trey, we're going to share just a brief video about the culture of innovation at Maravai. Thank you. [Presentation]

And now, ladies and gentlemen, please welcome to the stage, Maravai's Chief Executive Officer, Trey Martin.

Hi, everybody. Thank you. It's great to see you all here in the room. This is actually our first ever live R&D and Investor Day, but also, of course, a warm welcome to our online guests. I believe there are more of them than there are in the room. So we got a big crowd today, and we're really excited to share with you a pretty full amount of content here. I'll start by saying Maravai means miracle. You'll see that all over the material just to help explain it. The focus of today is our R&D innovation. And I hope you're going to leave here with a better understanding of Maravai's next chapter of growth, post-pandemic growth, the next generation of medicines enabled, and that's what we mean by extraordinary science and everyday miracles. All right, so let me share some of the reasons with you that I'm so excited to be leading Maravai at this unique time. We've had very strong financial performance, as you all undoubtedly know. You see here a quote though of 23% of base revenue CAGR. That's important. COVID CleanCap has taken a lot of the headlines through the pandemic. And it's important to note that the underlying business is very strong, repeatable and growing. So 5-year CAGR on 23% of base revenue, which excludes all of the COVID vaccine participation. We're positioned now with an exceptional balance sheet, as you can see. You're going to hear all today about innovation and the strong patent portfolio that the company has. Our mindset is very much on innovation for the next generation at Maravai. And we're very pleased with the continued uptake of our differentiated technologies. That strong pandemic performance led to significant additional facilities, an investment in a commercial team. I'm going to touch on that later today. We have an exceptional customer base. As you can see, we work with 96% of the top R&D spenders already. At last count, CleanCap is involved in 250 preclinical and clinical programs across a variety of disease states. And as we're very proud to continue to share that Cygnus is at 100%. So all approved CAR-T cell and gene therapies are QC-ed with Cygnus technology. So I'm really pleased with the strong foundation that we start with here, and we look to a lot of exciting future growth drivers for Maravai. I'll take a moment here to highlight the leadership team. What you'll see, as I let you scan this slide, is a tremendous amount of cumulative experience across life sciences. And it's a really fantastic, talented and passionate group of leaders. You're going to hear from many of them today. We have 2 breaks together and a lunch, and I hope you'll get the opportunity to meet and converse with any of them who peaks your interest. All right. So strategically, you're going to hear this a lot. We say we want to win in discovery or the front end of the funnel. And what that means is we hope to enable the entire field to seed the value stream and stay with our customers all the way through their journey of realizing the next generation of medicines. We do this with a relentless focus on customer need, listening to VOC, for example, actually last week, we had our customer-focused conference we call mRNA Day, where it's just another level, frankly, from what I've seen, of collaboration, responsiveness and completely focused workshops with our top customers to focus on solving their pain points and understanding their needs at a totally different level. So the new commercial team is building relationships and networks. And then, of course, that's complemented by our history of experts in the industry with a very rich technical history. We also, as you'll hear, have an excellent base of IP trade secret technologies, and as you saw in the prior slide, most of our team came from large organizations, and we're really excited to engage our customers in nimble and creative ways to try to build a big business, but with an entrepreneurial spirit. So Maravai was assembled from a collection of acquisitions. And I would say and do say we have specialized in founder-owned, scientifically driven, category-leading companies, where we could continue to invest to drive their growth. The companies, as you can see up here, have spanned small start-ups to 35-year established industry leaders. Now Maravai itself as a collective company was taken public in 2020. But when we refer to TriLink, when we refer to Glen Research, when we refer to Cygnus to Alphazyme, those are the specific brands that have comprised Maravai, which is, again, the overall holding company in stock. The 2 most recent acquisitions were MyChem and Alphazyme, and we're also going to touch on those quite a few times throughout the day. The MyChem acquisition really strengthened our nucleic acid chemistry expertise. It was also a vertical integration strategy to strengthen the supply chain during the pandemic for the production of CleanCap. Drew is going to touch on some of those capabilities in his section. And then Alphazyme, which is the provider of critical enzyme manufacturing capability, really that enables many workflows. I'll walk you through an example of that, but you'll also hear from their General Manager, Chad Decker, later today. So we are organized into 2 reporting segments publicly. You see up their Nucleic Acid Production or NAP and Biologics Safety Testing or BST. NAP has received many of the headlines through the pandemic, and we're obviously going to hit on a lot of the new technologies there, but BST has plenty of innovation in it as well. And you're going to hear from Christine and Eric and David today about some of the product road map for Cygnus, which is very exciting. All right. So I'm going to walk you through a workflow here. I'm a biochemist by training. So you'll forgive me. I'll keep the drawings and chemistry to a minimum. But I think it's important for people to understand that by virtue of the acquisitions of TriLink, of Glen Research, of MyChem, Maravai has a completely unique position in nucleic acid chemistry in the industry. Nucleic acid chemistry, I might be biased, but that is really the basis for all genomics. And in this example, for example, this is an mRNA drug product realization workflow. So nucleic acid chemistry, in this case, makes synthetic oligos. Oligos are used to make synthetic genes. The synthetic gene becomes a variable region of a plasmid, which is used as the template for the production in a reaction called IVT, or in vitro transcription, to actually make the mRNA itself. So at every step of this workflow, enzymes and nucleic acid chemistry can enable differentiated performance, in yield, in purity, in speed, and so on. One note, actually, I'll make there. You see that the last 2 steps are not highlighted. The last 2 being lipid nanoparticle encapsulation and final finish and fill. We are focused strategically, at least for the next year, on drug substance, mRNA drug substance. It's called drug product after you formulate it in a nanoparticle and do a sterile finish/fill. We have so much to do and so many opportunities to differentiate ourselves with enzymes and chemistry and process that we're going to stay strategically focused there. So here are multiple workflows. And I'll point out that, again, the front end of the funnel or discovery, on the left side of your screen, is where we hope to win early and stay with our customers through every phase of their development. The tail end, or the right side, is where many analysts and, frankly, all traditional CDMOs tend to focus. But we, again, want to enable at the beginning, and that allows us, as a primarily product and technology company, to ride along with the customers through every step. And this is really true through both of our reporting segments, as you can see. What's important to note is that we can be profitable at every step of development. It's not just commercial at the very tail end that can be profitable. That said, we offer products and services at scale. We think of them as being synergistic to each other. Our services can pull products along. I'll give you an example of that in a minute. And our best-in-class products can improve the services. Another note I'll give you here is that across all of these workflows, from discovery to commercialization, Maravai's entire business is 100% consumables. Okay. So here's a customer example. This is an anonymized large pharma company -- by the way, you will get several of these customer examples through the day. We're supporting this company in their development of an mRNA component of their CAR-T cell therapy. It's against small cell lung cancer. And it's currently in Phase I, and they actually even test their production with Cygnus tests. The first purchase for this customer was pre-pandemic, as you see, in 2018, less than half a dozen discovery mRNA constructs. But in '22, they went over 400,000 a year with a much larger screen. And it was really the supply of custom and catalog mRNA that enabled this customer's adoption of CleanCap technology. They've now shifted to in-house manufacturing, but they still -- we still support them with CleanCap, which is locked in, in one pseudouridine and NTPs and they've recently added oligos and other products to their purchases. So they anticipate moving to GMP in 1.5 to 2 years. And this, again, is a good example of how services can pull products through. Even if we don't stay with the customer from a service perspective, the products do stay with them all the way through their production. While the pandemic was an enormous challenge and an enormous opportunity from our large group of companies, notably, again, the headlines went to TriLink's CleanCap. In that time, we scaled CleanCap a thousandfold, moved it from an RUO product to a GMP product, and it was incorporated into the Pfizer-BioNTech vaccine and clinically proven in billions of doses of vaccine across the world. More broadly, the pandemic validated mRNA is a modality and proved that we were well positioned, I would say, to capture the future opportunities for the next generation of medicines. The second half of that story, economically, is that we ended the pandemic with over $0.5 billion in cash with the acquisitions of Alphazyme and MyChem, that we'll touch on several times today, and 4 new facilities, and those are assets that we can leverage for the next 5 to 10 years. I'll take a deeper dive there now. You've heard, probably in our public disclosures, about Wateridge. Wateridge was the only site through the pandemic. It's TriLink's primary site, RUO and early stage preclinical and Phase 1 GMP support. But Flanders 1, this is our brand-new site for GMP small molecule production. It provides site redundancy for Wateridge, and that's the reason that BARDA supported this site for future pandemic preparedness, so that we could have 2-site GMP production capability for critical inputs for mRNA vaccines. However, this site has 4 suites, each larger than the original suite that handled the pandemic supply. So tremendous scale-up capability. The 4 suites can operate in parallel. Flanders 2 is on the same property, but is a completely separate and distinct entity, which supports our mRNA service through Phase II and beyond. Flanders 2 has 3 clean rooms to run mRNA process and one dedicated bulk filling room. So we've designed both facilities, Flanders 1 and 2, for parallel campaigns for capacity and speed. Finally, Cygnus, Leland, provided a much needed boost to capacity, opportunities for automation, R&D, lab space for services like mass spec, and a dedicated space for the MockV business, both in cell growth and in R&D. And you're going to hear from David specifically about that business line later. So post-pandemic, 4 new facilities, again, brand new, that we can leverage for some time to come. We believe that we're operating in a very attractive space. Drew and Becky are both going to touch on continued pipeline progression for mRNA-based therapeutics across our customers. We expect additional advancements in chemistry, our own technologies and others, and delivery innovations beyond the first generation of lipid nanoparticles. And advancing cell and gene therapies, particularly CRISPR-based therapeutics, adds an exciting amount of opportunity for us. And I'll point out here what I mean by that. So mRNA and oligos can be therapies in and of themselves, or they can be the tools that help produce cell and gene therapies. Some of you are nodding. So I know you get that, but I appreciate it. Continued demand for GMP grade inputs as the trials progress. Command, of course, of premium pricing for premium products and services. So there are many opportunities here from a macro level in the field that we work. The addressable market, though there are near-term headwinds, we're confident in the long-term growth rate for biologics for mRNA and for CRISPR. We believe our SAM will double over the next 5 years. We should be able to outpace market growth with differentiated products and services. Some of our Maravai specific tailwinds are the expansion of our product portfolio. Again, you'll hear about all day. Our commercial team and our new geographic coverage. This is actually brand new to the company in the last 6 months. We've discussed publicly the recent addition of mRNA capacity from the very large CDMO players. That has been a recent discussion. And the customer program rationalization is really a phenomenon industry-wide at the moment, as people have been deferring projects and longer decision-making. But we believe this is a transient issue, and the return of the market growth is a matter of when, not if. So we think we're well positioned to capture the opportunities ahead. And as you're going to hear throughout today, we're continuing to focus and invest in innovation. As I just showed, we have the facilities in place to gain operating leverage over the next several years. We continue to invest in and scale our commercial organization under Becky's leadership, and we will continue to pursue inorganic opportunities. Innovation, you're going to hear a lot about today. It's all focused on the needs of the customers. So we start from a principal framework of trying to solve customer pain points in specific workflows where we can provide strategic advantage. We're bringing in analytics and other capabilities around those workflows and developing manufacturing innovation through lean and other processes, and those processes enable differentiated services, again, that complement the products. These are the core pillars. You're also going to see these many times throughout most of the businesses that we'll report to you today. It's pretty simple. There are only 4, but I'll walk you through them basically and talk about how they relate here. So number one is catalyze the customer journey. Here, we're trying to activate the innovation engine, again, focused on customer pain point, to gain more customers and more wallet share of each customer. Find a better way is our continuous improvement pillar. We recently actually hosted what we call Find a Better Way Day, which I thought was a cute name, and Find a Better Way Day is when we do essentially report outs. In this case, it was 12 different optimization projects for TriLink, and we celebrated efforts across the org for improving basically the way we work for business operations, research efficiency, production efficiency, lean and customer experience projects. Number three, deliver unquestionable quality. This is a nonnegotiable in this industry, obviously. We hope to do so with an industry-leading and quality-focused culture, as well as processes and systems. Finally, our team-based pillar is lead together. So we encourage everyone to lead together, and we hope to make our people and our culture a competitive advantage. Double-clicking into commercial strategy. I'll just take one slide here to talk about that. I spoke about how we are assembled from scientific founder-driven organizations. And when you have a category-leading scientific founder organization, it doesn't typically come along with a mature commercial system or footprint. So the associated systems and the people is something we've been investing in over the past year. And we think the commercial organization is a strategic part of our shared services and can be leveraged across Maravai's group of companies. So we've invested in staff and training programs, training and technical and sales fundamentals and all the things you would expect. And again, we've expanded our presence internationally for the first time with reps in EMEA, Japan, Korea and Singapore. Finally, we've enhanced the way we work with our distributors, added process improvements, brand-new web capabilities, and automation for all customers across the businesses. So as you've heard, Maravai was created through M&A, and I'll reiterate to you now that this continues to be a key priority for us, but specifically and strategically focused acquisitions. So as you'll come to understand today, MyChem and Alphazyme fit that mode entirely, where we're talking about strategic inputs to targeted workflows, where we can enhance our portfolio and assist customers. And to that end, we're interested in licensing as well technologies that can enable our customers to get the best possible differentiated performance in their programs, whether invented here or otherwise. So we see a path over the 5-year term to greater than $700 million in organic revenue, which would be about an 18% CAGR for the overall company from the end of this year to the end of '28. We will continue to focus on driving margin improvement to regain our industry-leading EBITDA margin. And we think we have a great opportunity there, as I've shown that we can leverage all of the new operating facilities for this entire period. Finally, inorganic opportunities, also still a focus, could just accelerate this growth. All right. So in closing, you'll hear throughout today's presentations from our team that our focus is to be the customer's first choice as early in the funnel or the discovery life cycle as possible. We believe we're in the right markets. We have a comprehensive suite of products and services that differentiate us. And we have been and will continue to invest in the next generation of Maravai through innovation and operational improvements. So thank you for your attention, for your attendance. And I'll kick off the rest of the day here with our Chief Innovation Officer, Dr. Kate Broderick.

Hi, everybody. Good morning. My name is Kate Broderick, and I'm the Chief Innovation Officer here at Maravai. And as part of the mandate of my position, it's really there to drive the R&D that fuels the innovation enzyme across the diverse divisions within the company. So I'm really excited to spend the next 20 minutes with you covering kind of our historical track record with innovation, focusing primarily on what our current areas of focus are, and then just a tiny snapshot into where we think the future is going to go. Now self-disclosure before I get into my slides. I am a scientist and this is R&D Day, so I am going to get into the science a little bit. But hopefully, that will help you get an insight into the depth of the science and innovation within the company. So I shared this slide with you not because I think the world needs more inspirational quotes, I think the coffee mug market probably has that corner, but more than what Humphrey really does, a really nice eloquent job here of summarizing the mindset of innovation within the company. We really believe that it's our mandate to look for the solutions to our customers' problems, but potentially even before they know they have a problem, find it, develop it, scale it, manufacture it, have it ready for marketing when they need it. So some of our divisions within Maravai are decades old. And so with that, you might expect that we have a fairly strong historical track record of innovation. And I think that's really highlighted by the 122 granted patents that we have in our current IP portfolio. And that's really, as you can imagine, expanding every year. I'm going to touch on some of the major innovation areas in the RNA business, and we're going to have the BST team touch on theirs later in the day, too. Our R&D department is stocked with world experts in their field, and that really helps us add that scientific rigor and that credibility to the work that we're doing. And if we take a specific focus on our flagship product, CleanCap, over the last 8 years, that's been cited in almost 1,000 peer review publications, really speaking to the quality that, that product brings in drug development. So then let's take a magnifying glass and look at the COVID years. As you probably all know, in 2020, we were incredibly honored to be selected as the capping technology of choice for Pfizer-BioNTech COVID vaccine. And within a matter of months, not only did we scale that production and manufacture, we scaled to the level needed for a global pandemic. So that was a significant [Audio Gap]. Resting on our laurels, in 2022, we also launched CleanScript, which is a novel IVT process, helping us really reduce some of the impurities that are seen in the manufacturing of mRNA. And then this year, we launched our newest member of the CleanCap family, M6, and I'm going to talk about that guy a little bit later. But we were just notified yesterday that M6 actually won the Pharma Innovation Product of the Year, and that's something we're incredibly proud of. So who uses our products here at Maravai. Well, I'd like to think of this slide as a little bit of who's who in the life sciences arena. And you can really see that these remarkable development companies utilize Maravai's technology to expand the breadth of their already groundbreaking technologies. So really, as Trey touched on, since the inception of Maravai, the business model was always that we would utilize strategic M&A to bring together synergistic entities, technologies, individuals to really kind of utilize a 1 plus 1 plus 1 plus 1 equals 10 approach. And so with the pioneering technology of TriLink, the deep insight into oligos of Glen, the really world-leading excellence of Cygnus, and the innovative enzymes of Alphazyme, we've really created, within Maravai, a holistic ecosystem that covers really a broad wave of the RNA and biosafety testing fields. So for our innovation to be successful and keeping that kind of constant mandate in mind, we really need to use the input of our customers and their feedback as our guiding star. And so really leading into their issues that they're currently having and being proactive about the potential challenges we might face in the future. We're also very lucky to have an extensive in-house set of internal experts and the network of external experts that we can validate our positions with, and, of course, utilize insight from conferences and peer-reviewed journals to really keep us up to speed within a very, very fast-changing field. So I'm a huge believer that to solve the problems within the RNA medicine field, you first really have to understand the molecule. I think that's absolutely critical. And I do recognize that many of you in the audience today are as qualified as I am to be up here talking about RNA. But if you'll humor me, I thought that what we could do is walk through some of the critical motives within the molecule that might kind of help to underpin why we're developing the technologies that we are. So for those of you that are molecular biologists, 5 prime and 3 prime just means front end and back end. So let's start on the front end of the molecule. And that is the 5 prime cap, and that's obviously very synonymous with Maravai/TriLink with our CleanCap technology. And the primary function of the 5 prime cap is there is a protective feature. So as an uber-visual person, I kind of imagine it a little bit like a front bumper or a car. So it protects the rest of the vehicle. But within the cap, it also contains a GPS system. So it guides the molecule through the cell to where it needs to go. And then when it gets where it needs to go, which is the ribosomal complex, then it uses parking sensors to ensure that it's perfectly positioned within that machinery. Then moving down the molecule, the next you come to is the UTR. So that just stands for untranslated region. So that's a portion of the molecule that, as the name suggests, isn't actually turned into a protein, but it's really, really critical in being able to tune the molecule. So I think of it a little bit like the electrics in a car. So the UTRs, you can tell the molecule it needs to be expressed at a high level or a low level or just there at certain times within the cell cycle. Then we move on to the payload, and that's the coding sequence. So if you think about that, if this was a COVID vaccine, that would be the sequence of the spike protein; if it was a therapeutic cancer vaccine, that would be here a string of new antigens. And then we've got another UTR flanking the coding sequence. And last, but certainly not least, we end the molecule with a poly-Al tail. So again, going back to the car analogy, that's really your back bumper. So it's definitely there in a protective environment, but also has kind of backup TAMs that allow it to make sure that the back end of the molecule is positioned really nicely within the ribosomal machinery. So then how does Maravai play within this concept. So 5 prime cap. I think everybody here knows that our flagship technology is CleanCap. And if you don't mind me overutilizing the car analogy, think about the bumper on a smart car versus the bumper on a Ford F350. And they're 2 very, very different pieces of machinery. And our vision here at Maravai is that we really provide that plasticity, that variety to our clients through a whole library of caps that have very different attributes, and it can be dialed in depending on the product of our client. The UTR region is not an area currently that we offer products in. But our vision is that when a client comes to us and says, "Okay, Maravai, we would like to use one of your capping technology, and we're going to select cap X", probably a bad use of an analogy there. But then we'll say, "okay, can we also offer you to look at our library of UTRs that will be really harmonized very well with that capping technology?" On the coding sequence side, of course, we provide our clients already with what we call wild-type and modified bases. So those are the Lego bricks that make up the coding sequence. And then an area that I'm particularly excited about that we're working a lot on the innovation team on is also providing our clients with a library of tailing technology. So you come to us for your cap, you come to us for your tail, and you can come to us for everything in between. So Drew is going to really cover on this, so I'm not going to belabor this too much, because he will go into much more detail than I will. But our vision for our RNA related products really is kind of outlined here. So you know that we already provide capping technologies, but that's kind of not a static thing. We have a dedicated team of chemists and biologists every day looking for the latest cap, the newest cap with different attributes to offer to our customers. So for obvious reasons, I'm not going to go into elaborate detail about what specifically we're looking at, but suffice to say, you can imagine that clients are looking for potentially cell-specific capping technologies. They might be looking for the ability to dial the expression at a certain level, and you can do that via capping. On the UTRs, as I mentioned, we're looking about building up a library of that technology. On the coding sequence, we're continually looking to build our portfolio of bases. And as I mentioned, we're looking at really creating a bespoke library of tailing technologies that our clients can pull from depending on the attributes of their particular product. So again, this is really going to be in depth discussed by Becky, so I won't go into great detail here. Suffice to say that when you think of the services industry, DNA is critical. Of course, it's a starting material of mRNA. And so we already offer our clients plasmid, but we really want to extend that and say, okay, what could expand that technological advances. And that's really looking at novel DNA templates that can perhaps circumvent some of the complexity with longer sequences and complicated sequences. In the RNA field, we are synonymous of course, with manufacturing, research and GMP-grade RNA. But we're really looking to expand our footprint in some of the more novel areas like an saRNA and circular RNA. And on the enzymes side, Chad is going to tell us about the remarkable work going on at Alphazyme. And we're really very excited at the opportunity to identify novel IVT enzymes and enzymes that can be used in analytical assays or other novel processes that will be really important as we move through. So I'm assuming if you're here, you're fairly familiar with CleanCap technology. But what you're looking at here is our current library of CleanCap AG products. So in the orange is our original CleanCap AG, and that's being used in over 250 preclinical and clinical products. In the center and kind of bluish is our 3 prime OMe CleanCap, and that was, of course, the capping technology that was used by Pfizer-BioNTech. So has been in now billions of doses. And last but not least, our newest family member, CleanCap M6. So unlike the iPhone model, where the newest phone gazumps the previous phone, we really don't think about it that way with our capping technologies. In fact, we really think of it as synergistic as additive. So the more caps that we have within our library, the better it is for our clients. And no worries at all if you aren't chemists in the audience today, and this just seems like hieroglyphics to you. Really, the take-home message is that by understanding the chemical modalities within each of these molecules, we could tweak them and really tailor the attributes of each of the capping molecules. And I'm also able to show you these structures in detail, and that really speaks to the fact that we own the IP for this foundational technology. So moving on to our newest innovation, and that's CleanCap M6. So a question I would get very frequently prior to the M6 launch was from peers and friends in the field. "Okay, so why should I use CleanCap over the variety of other capping technologies that's out there?" My answer to them was, well, there is a huge amount of manufacturing benefits utilizing CleanCap. And without going into great detail, because Drew will, really, we do it all in a single one pot manufacturing process, which really helps you streamline, save time, save money, et cetera, et cetera. And that can't be minimized. It's incredibly important. But with M6, in addition to the quality attributes that are synonymous with CleanCap, which is high capping efficiency, high yield, low double-stranded RNA, you also get the incredible power of by utilizing this new CleanCap, you're able to dial up your protein expression by approximately 30%. So that sounds great scientifically, but what does that actually translate to from a clinical perspective, what does that translate to from the perspective of our clients? Well, that means that if you are developing protein replacement technology, you can utilize M6 on the front of your mRNA molecule. And for each dose you deliver, you can potentially increase that potency by about 30%. If you are developing a cancer vaccine, you might be able to potentiate the immunogenicity by the fact that this molecule will allow much better expression. So there are really some really significant benefits to the utilization of this capping technology and ones that will have vast positive impacts, I think, as they are translated into the clinic. So you don't have to take my word for that. I wouldn't expect that. This is actually some of the data that underpins my ability to make those statements. And again, you might not be completely familiar with what you're looking at here. So let me do a little bit of a descriptor here, starting on this side of the slide. So a picture speaks a thousand words, in my opinion. So what you're looking at here in black and white are too mice that are under anesthetic. They're asleep and have been positioned within a chamber in an imaging machinery. So the top end is the nose of the mouse and the bottom is it's back legs. So what we did with these groups of mice, and you can imagine that these 2 are just representative. Obviously, we do more than 2 mice. And what we did was we took a group of mice, we gave them mRNA that expresses a protein that gives off light. And with half of those mice, we put on an enzymatic cap. And with half of those mice, we put on an M6 cap. So the mice got exactly the same -- treated exactly the same way with the exact same mRNA, except that one had enzymatic cap on the front and one had an M6 cap on the front of the molecule. So the readout of this particular study here is the amount of light, and that's a surrogate for how much protein is expressed. So where you see the psychedelic coloring picture, hopefully, you can see, just by looking at it, that the mice that received the mRNA with M6 on the cap are considerably brighter, more robust lighting picture. And so we translate that to considerably more protein expression. And then that's really being quantified in the middle of the slide there and looking at specific time points. So this just isn't a flash in the pan that only happens at 12 hours, you can really consistently see that the expression of the M6 construct is consistently higher than enzymatic capping. And although the kinetics of the expression are fairly similar actually between the 2 modalities, what you can see is that the peak of expression is much, much higher with M6 over enzymatic, so the decay of that expression means that M6 is around longer. So you get higher expression and detectable expression for a much longer period of time. So that was me giving you kind of a focus on the RNA medicine field. But as Trey mentioned, of course, we have the remarkable innovation going on in our Cygnus division. And just to kind of level set for everybody who might not be super familiar with this, any product that utilizes a biological manufacturing process, and that could be a protein or a vaccine or an antibody, must test that product really rigorously for the presence of byproducts. And that's really where Cygnus comes in. They have really led the field in developing the testing kits for the detection of these impurities. And I'm not going to say anything more because Christine and David and Eric will, but I do want to blow the trumpet of Cygnus by saying that 17 out of the 17 approved cell and gene therapy products utilize Cygnus kits. And I think that really speaks to them as the gold standard in the field. So I don't think I need to tell anybody here that this field has a remarkable growth potential. And as we think about RNA as a modality, I think, of course, your mind initially goes to COVID, but it's so much more than COVID. On the infectious disease side of things, we've seen some remarkable advances in the flu field. And think about -- we still have the unmet need of an HIV vaccine or a malarial vaccine. So there's a huge amount of work that could be done in the infectious disease field. On the therapeutic side of things, I truly believe, as a scientist, that in 5 or so years' time, the point of care will be personalized cancer vaccines, and that will either make chemotherapy completely redundant or at least reduce its use in a clinical setting. Cell and gene therapy side of things, I think we're looking probably at our first approval of a CRISPR technology by the end of this year, and that's really only going to open the floodgates for more and more of those products. And so as you think of the scope of what's just been described there, each one of those products needs a cap. Each one of those products needs bases. Each one of those products needs the components that go in to build each of these RNA molecules, and that's where Maravai plays its part. And on the side of BST, Christine and Eric and David are going to talk about the expansion of their kits, of their MockV portfolio, and of their mass spec services. So just a tiny snapshot into the future, into where we believe the future of this field is going to go. And so within the RNA side of things, as I mentioned, I think novel enzymes are going to be really key as we think about new modalities and perhaps better modalities that have the ability to reduce some of the challenges that we see today. I also think, as we think about this broad portfolio of RNA utilization, we're going to need the accompanying analyticals to go with that. That's absolutely critical. And so that's a focus for us. And as Trey mentioned, LNPs have done an amazing job in the field of COVID vaccines. But what does the future look like? Does that look like an LNP? Does that look like another modality alternatively, or a combination of both? And then, of course, as I mentioned, there's some really exciting work going on in the field of saRNA, so that's self-amplifying RNA or circular RNA. And within BST, we're looking on expanding on our kits and our MockV portfolio as well. So this is my last slide. I'm going to leave you coming back to the central tenet of our 4 pillars within Maravai, and I'm going to take a focus on how they impact our innovation within the field. So starting with capitalizing the customer journey. Well, as I mentioned at the start of my talk, the input from our customer is the only reason that we drive our innovation. It has to be focused on the input of the customer. That's absolutely key to us. Finding a better way, well, it's like the literal translation of innovation. So we're looking at ways that we can apply our rational R&D to solving those customer problems. Delivering unquestionable quality, I think we're able to do that through the expertise of the team that we have within the divisions at Maravai. And last but definitely not least is lead together. So bringing those, frankly, diverse expertise, but together in a way that's synergistic, so that we can really create holistic solutions for our clients. And probably the most important one personally to me is the fact that Trey and the company have made innovation an absolute mandate moving forward. I truly believe that Trey believes and understands that innovation is the lifeblood of the company and is what will push the future growth. And with that, thank you very much for your time, and it's my pleasure to pass on to Drew Burch, who heads our Nucleic Acids division.

Okay. Thank you, Kate, and good morning. I'm excited to be here, although I'm in the unenviable position of following up Dr. Kate Broderick, which is a tough task. But I'm going to provide an overview of one of the company's 2 segments, our Nucleic Acid Production business. I'll provide an overview, and then I'll be joined by Chad and Becky as we deep dive into a few of the different components. So the business overall is a broad portfolio. We offer innovative products and differentiated services to those who are looking to produce mRNA. On the top, you see the products ranging from capping analogs to NTPs to enzymes. You see our services as well, focused on the different parts of mRNA production as well as analytical services. All of this is fueled by chemistry expertise by a history in producing enzymes, by 20-plus years of producing mRNA, and by deep analytical expertise, and it's all driven by innovation. So a brief recap on the capabilities that came together, 4 founder-owned companies formed Nucleic Acid Production. TriLink was founded in 1996 and has decades of experience in nucleic acid chemistry. That's led to innovations such as CleanCap. And in fact, several of our employees pass their names on our patent wall every single day. Glen Research was founded even earlier, in 1986, and is a leading supplier of reagents for DNA and RNA synthesis. And more recently, MyChem was acquired, which is a source of ultrapure nucleotides and rounds out our chemistry expertise. On the right side, you see Alphazyme, which brought to us a team that has decades of experience in producing enzymes. So we think that's an exciting opportunity for the company to address the mRNA production process as well. So as you know, one of the most exciting areas of translational research today is mRNA medicine. It's a big focus for Maravai, and it's a big focus for the Nucleic Acid Production business. We're not a drug developer, but we help those who are. We're also not, as Trey said, a lipid or a fill/finish provider, but where we can add differentiated value is to the process in between, translating a desired sequence into a drug substance. So we supply innovative and best-in-class material inputs, and we can also expertly run that IVT reaction. We're focused on driving innovation in this portfolio, both for the inputs and for the process itself. And we aim to enable our customers to unlock the full potential of mRNA medicines. So Maravai brings a host of strengths to this marketplace. We have a suite of products that's differentiated, and we continue to drive innovation, as Kate described. We've also been producing mRNA for over 2 decades. That's the depth of expertise that can't be matched by the latest CDMO that repurposes a suite for mRNA production. We've built and improved our analytical capabilities to support testing and support our customers as they move through clinical trials, regulatory approval and commercial production. And we've committed the resources to be able to deliver a great customer experience with flexible capacity, rapid execution and supply chain reliability. Our suite of competitive advantages allows Maravai to deliver for customers in ways that few, if any, of our competitors can. I want to talk about the flywheel effect that we experience in our business model. Every day, we're deploying new products and we put those into our mRNA production process. We get immediate feedback. We're also working to improve, as I said, the mRNA production process itself. We know where the pain points are, we know where the opportunities are, and that informs our product development and drives our innovation. So the products improve the process and the process feeds back and improves the products. That's a luxury for both aspects of the business, and we believe it puts us in a position to move the field forward in a unique and differentiated way. We also have a great dynamic on the customer front. Very often, customers will come to us early in the research phase and ask us to supply products, either input products or research use mRNA. As those customers progress into the clinic, very often, they come to us to provide the production services for their clinical trials. As they progress further into the clinic and into commercial, those companies may choose to leave production with us. They may choose to in-source or put it somewhere else. Even when the production is located somewhere else, we continue supplying the products that are inputs into the process. So you can see what this looks like with one customer on the left, where purchases can start at a very small volume, and in a short period of time, ramp up quite significantly as the customer progresses. Now let me transition to talking about the market. The market for our products and services has many layers. Of course, COVID was the first commercially approved mRNA medicine and offered an exceptional proof point. It accelerated the science, provided regulatory approval and the proof point that comes from billions of doses in arms. Today, there are 3 approved mRNA vaccines outside of China, and I'm delighted to share that COVID CleanCap -- that CleanCap is in 2 of those 3. While this field has led to some declines of late, it still remains exceptionally active and is an important area. You may have seen just yesterday, too late for inclusion in the slides, but the U.S. government through BARDA funded Gritstone with up to $400 million for their self-amplifying RNA for COVID. So this area continues to be important. But more important going forward is the broad range of opportunities in fields outside of COVID. You're probably familiar with clinical trials well underway for other infectious diseases like flu and RSV. There are also clinical trials underway for a broader field of nonrespiratory infectious diseases, both viral and bacterial, and you may know that there's significant funding, significant trials underway, government funding and otherwise, for a broad variety of indications, cancer especially, with several significant positive proof points in clinical trials as those programs advance. So quite a broad field of opportunities ahead for mRNA. And then one step further is cell and gene therapy where, as Trey mentioned, there are a variety of companies using CRISPR/Cas9 or other gene editing technologies to advance their programs, and very often and increasingly so, choosing mRNA as the vehicle of choice to deliver that genomic payload. So we think this is a significant expansion opportunity for the company. So one barometer of market activity that we watch is the entrance of programs into clinical trials. Of course, there was a flurry of COVID activity in '20, '21 and '22. They captured attention and even diverted a little bit from the level of non-COVID activity, as you see in 2020 there. But what we've seen is an increasing number of programs moving into clinical trials for non-COVID mRNA applications year-on-year and even in the first 6 months of this year. Another barometer that we watch is the funders of those clinical trials. And you're likely familiar that all of the major vaccines companies are either running or funding clinical trials using mRNA for their vaccines programs. Additionally, there's a broad range, and this is just a smattering, of leading biopharmaceutical developers who are funding mRNA clinical trials as we speak. And finally, on the left side -- your right side of the screen, there is an active venture capital community that even in the first part of this year, and this is the selection of companies that have raised greater than $100 million rounds that are essentially mRNA focused companies. So across that spectrum of company types, we see active clinical trials and robust funding dynamics. Okay. So that's the overview of Nucleic Acid Production. Now we're going to break it into segments. I'm going to spend a little bit of time talking about the products specifically. Chad is going to come up and talk about the Enzyme business, and then Becky is going to join us and talk about the Services offering. So focusing in on the products. As Trey said, we seek to enable our customers to produce better mRNA. We want them to result with a product that's better at achieving the desired effect, that has a reduced side effect burden, at a lower cost and faster. That's really the focus of our innovation efforts. This is an overview of our product portfolio. Of course, CleanCap is the flagship franchise. It enables highly efficient mRNA production with high yields, capping efficiency and purity levels. We've got 4 CleanCap analogs, 2 of those already in vaccines, having received regulatory approval. We also offer NTPs, as Kate said, both at an RUO level of quality as well as at a GMP offering. We produce oligos, the foundational technology that lies at the heart of all genomic medicine. And now Alphazyme brings us into the enzyme business as well. Through the pandemic, we obviously pushed our innovation. We also pushed our manufacturing capabilities. Customers very often start with us working on a custom assignment to solve their challenges. Where appropriate, we move technology into catalog research-use-only offerings. And then as our customers progress into clinical trials, we're able and have proven that we can move products into GMP manufacturing conditions. Our flagship CleanCap franchise, of course, is the furthest along in this process. We have 4 CleanCap analogs. As I mentioned, 3 of those are already produced and delivered as GMP-level products. We also offer, in the NTP category, N1-Methylpseudouridine as a GMP offering. And we'll continue to grow moving forward with customer needs. Okay. Let me spend a few more minutes on capping and dive a little deeper. As Kate mentioned, 3 different approaches to capping, enzymatic, ARCA and CleanCap. Transcriptional capping with CleanCap analogs enables our mRNA production with high yields, high capping efficiency, with a faster, cheaper production process, the one-pot reaction, as Kate mentioned. So with this family, our customers have achieved better transcriptional yields with capping efficiency over 95%, and a reduced likelihood of negative immune responses. That all, I think, is reasonably well known. What's less well appreciated is that CleanCap provides a faster process development, a faster production cycle and a cheaper production process. Research suggests that CleanCap has captured over 1/3 of the marketplace for mRNA capping, and we aim to extend this moving forward. The newest member of the family is CleanCap M6, and we're particularly excited about this analog. As Kate said, it enables significantly more protein expression, it retains all the benefits of the previous CleanCap analogs, and it gives researchers a much more powerful tool. It allows them to potentially dial up the therapeutic effect with the same quantity of mRNA, or it allows them to reduce side effect profile with a lower dosage. We believe this innovation is going to enable us to gain additional share in the capping marketplace. So I hope I'm able to convey all the excitement that we feel about M6. And I'm glad to report that our customers also seem to be excited about M6. We launched this product at the TIDES Symposium in May. And since that time, over 80 customers have ordered the product. It's actually a little bit out of date as of today. And over 25 of those customers have returned for repurchase. And this, by the way, is our direct customers only. So we sell through distributors as well. And there's a roughly similarly sized population that we don't have as much visibility to going through distributors. So I'm excited also to share that this interest comes from all 3 categories of companies I mentioned earlier, the major vaccines companies, the leading biopharmaceutical developers, as well as the mRNA-focused start-up companies. So the customer response has been fantastic, and we're excited to see this analog move with its brethren into clinical applications. Okay. Before passing the baton to Chad, I'm going to spend a minute on our oligo capabilities. This is a well-established business for TriLink. The reach is broader than just mRNA. This business supports next-gen sequencing, where both existing and new companies are using NGS, both in research applications and increasingly in clinical applications. The business also supports other genomic tools, molecular diagnostics, et cetera. And finally, as gene editing companies use CRISPR/Cas9 and other gene editing technologies, our oligos can be used as guides to help that genomic payload land in the right spot. So we think that offers significant opportunity ahead as well. So of course, we do, as a company, talk a lot about mRNA and capping, and that remains our primary focus and what we're best known for, but we do serve broader markets as well. We touched on the cell and gene therapy market. We touched on PCR and NGS markets also. Okay. So let me wrap up on products. We see an exciting opportunity ahead for this business. We're driving innovation to help our customers capture the benefits of mRNA technology and translate that in genomic science into therapies with potentially huge benefits. We're leveraging advanced manufacturing capabilities and our customer service capabilities to help them advance. We're helping them progress through clinical trials, regulatory approval and commercial, with the quality system that they need to be able to make that journey. And we have an exceptional team of chemistry experts, mRNA experts, and now enzyme experts to move the science and the field forward. So I'm super excited about the future ahead for products. And with that, I'll pass the baton to Chad to talk about Enzymes.

I appreciate everybody for taking the time to be here today. This is especially exciting to me, having been a cofounder of a company that's acquired. It's very near and dear to my heart. So excited to have the opportunity to speak with you all. So a big statement on this slide. Enzymes are the currency of the bio-economy. So what does that mean? Well, to me, it's pretty simple and straightforward. If you think about every microbiological function, it consumes or utilizes enzymes. So it may seem overstated, but the reality of it is, without enzymes, we don't exist. So that's so powerful to me to be part of a company that manufactures enzymes. So as well, why would Maravai be interested in Alphazyme. Obviously, we can be part of a broader organization and bolt to them and add value immediately. But a quick story. A few years ago, I came back from a meeting out in California where I met with Maravai. I came back to the office and I sat down with one of my cofounders and I said, "Chris, Maravai will be the company that acquires us." And he said, "Really, why do you think that?" I said this is pretty simple. I said the synergies are just too good. And I mean that, and I've realized that now that what I thought then I knew was only the tip of the iceberg. Obviously, we can help with the portfolio companies and assisting them. We play in adjacent markets in life science and diagnostics. The way we look at the business is products and services is also another same synergy. That's the way they view their businesses as well. And then really the customer-centric approach is absolutely the way that we go into every engagement. Combine that with what I've learned now is the culture of Maravai really works well with the way that we've built an entrepreneurial spirit company as well. So companies develop diagnostic tests, gene editing, processes to alter genetic material polymerases, the re-DNA ligases to essentially prepare for sequencing transferases to elongate DNA and RNA. This is what we consider genetic literacy. So -- the problem with this is that manufacturing of enzymes traditionally has not really been able to meet the demand that has happened over the last few years for genetic literacy. Competitors that we see, they view scaling as really how do I get to the next biggest bioreactor, right? It's very linear for them in the way they look at that. That presents a lot of downstream processing problems, which then eventually become -- really prevents them from being nimble, fast, and be able to pivot very quickly. And essentially, what the customers get in the end is a one-size-fits-all approach. So since becoming part of Maravai in January, and I think it's important to reflect on the integration process. We intend to do quite a bit of an organic growth over the next few years. And as a company that is acquired, it's our job to be able to look at that process and reflect on it and say how can we do this better for the next acquisition. From my perspective, I can tell you, having been with companies where we acquired many other companies and having been with organizations that we were the acquired company, this has been by far the best process. We actually -- Maravai has a great opportunity to utilize as much oversight as possible, but also be able to pull back as needed to make sure that we're getting that ability to maintain the entrepreneurial spirit, but all of those things that help us to grow in now a publicly traded organization. Obviously, now we can start looking at how do we help the rest of the organization. Our enzymes are now being utilized in the services business at TriLink. This is a big win for us, obviously. We cross-pollinate with the commercial teams. This is a phenomenal opportunity for us to be able to look at leveraging across the portfolio how we can touch all the customers for the workflow solutions. We continue to leverage our relationships as well that we have as partners, external partnerships that Alphazyme has maintained over the years. We'll talk a little bit more about that. Obviously, one of those being Codexis. You're probably well aware of that. And then we also are leveraging in-silico design firms for our manufacturing games as well. So as I mentioned, Alphazyme overlaps the most with TriLink. This is great in both ways. TriLink brings that customer base I mentioned. It opens the doors to a lot of companies that we might not have had the -- as a small company, might not have been really on their radar, if you will. And so it also gives us the resources that we need to expand quickly. As a small start-up company, you can imagine, resources are constrained and you have to be extremely dedicated and diligent about how you utilize those resources. From our experience, day 1, Maravai came in and said, "How do we grow you guys faster than you think you could have grown before? What do we need to do to enable you to move faster." And then Alphazyme brings to the table the ability immediately to take cost out of the TriLink manufacturing side of things. Also, as you saw certainly during the pandemic, supply chain constraints. We alleviate that completely now for them as we move forward. The synergies now being that both organizations are built on the strong backbone of an ISO 13485 quality system, also our leverage very quickly. So how do we differentiate ourselves? I can say we are nimble, fast and we pivot quickly. We constantly look at scaling down to drive efficiencies. In 2018, we never could have predicted what was going to happen with the pandemic. But interestingly for us, we actually built Alphazyme to address that exact concern. In 2016 -- we had the likes of all the folks you heard about on TV during the pandemic coming to us in 2016, and saying, for this new idea of mRNA therapeutics, we're going to need kilogram quantities of enzymes. We're going to need it at a fraction of the price. And by the way, we're going to need a quality system that has never been seen before for these, because they're going to be patient adjacent. Chris, one of my cofounders, and I, we looked at that, and that was our really thesis statement for how we were going to create Alphazyme. In fact, the first person that joined the team, one of my other cofounders was Stephana Petrino, our Head of Quality. So I think it's important to recognize that one of the first people that was part of this organization knew that the organization was going to have a quality foundation second to none. Our mission was to build a company that could scale and be customizable to our customers, but also the foundation had to be able to address the quality concerns that were going to be out there that we realize now every day. Currently, we have almost 9,000 documents in our eQMS system. We are almost a paperless organization as well. That's important because when you think about our competitors, they've been doing the same things for years. So they have these massive amounts of paper. So when they get audited, somebody comes in and says, show me this. Well, they have to run down the hall and they have to figure out how to find those things. For us, because we've built this from the ground up with what we wanted it to look like, our audits oftentimes are over 2, 3 hours earlier than they're scheduled for, because we can show everything that they need to see that quickly. It's at our fingertips. That's a lot to say for a 5-year-old company. So Maravai's portfolio has great brands, strong brands. And quite frankly, every TriLink customer utilizes enzymes. So as I mentioned prior, we can help with supplying enzymes to the TriLink business, and that opens up doors for us for the IVT community very quickly. It's that credibility, if you will, that we wouldn't have had as a stand-alone company. Now companies are coming to us saying, "Hey, you guys are -- you're supplying TriLink. That's a premier company in the world of what they do. Let's take a look at you guys as well." And so it's an important place to be, and it's able to give us an opportunity to address a market that we might not have been able to address certainly as quickly as we are now. And it's also an opportunity to really give the marketplace the new playing field that it hasn't seen before. So I'll touch a little bit on our -- Alphazyme's original innovation was really manufacturability. We went into this saying we're going to need kilogram quantities of enzymes, very, very low prices, and we're going to have to have a higher quality level. I think if you look at that from most business schools, they look at you and say, that is not a great idea, right? Let's take the price down, drive quality up and make larger batches. That was exactly what needed to happen to change the market dynamics. But we also now have the ability to look at partnerships in a different light. As I mentioned before, the credibility increases because now we have those sophisticated partners. But those partners are looking at other ways, not just COGS -- taking your COGS down to drive value to them. So we have to be able to look at being able to really take in those pieces of innovative technology that are out there in the enzyme market, be able to take them directly to our customers, but also open up the doors for us to be able to take it to TriLink and then let them open those doors as well for their customers. So it's great to say that we are differentiated. I can say we're faster, we're more nimble, we're more flexible. But truthfully, how is that done? And for me, I look at it and say, our customers have been doing the same thing for the last 20 years. The worst statement of business is, we do it that way because we've always done it that way. We looked at everything from the standpoint of, let's take a blank sheet of paper and design an enzyme company to address a market need that has never been needed before and is accelerating extremely quickly. And the great part for us is, we did that, and we did it day 1 with that vision in sight and then bolting us to Maravai has given us the opportunity to accelerate that vision. And not only accelerate it to get to where we wanted to be, but also now to look at different avenues to make it even more expansive. So for us, we are in the ruthless pursuit of efficiencies and quality. We look at 3 key parameters, mgs per gram, grams per liter, and time. What I mean by that -- so everybody here understands the manufacturing of enzymes -- most of you probably do. We look at mgs per gram, how many milligrams of an enzyme can get into a gram of cell paste, how many grams of cell paste can we get out of a single liter of culture, and then how fast can we do that? For us, because we're completely vertically integrated, we own that process. Our molecular toolbox, as we call it, is very unique. A lot of trade secret in it. The opportunity there is to be able to get to, as fast as possible, how quickly can we get that mgs per liter overall. So how many mgs out of a single liter of culture can we get as fast as possible? And then our fermentation and purification process, we push to the edge every day. The reason we can do this is because, as you think about, our competitors are working in -- often times they'll go up to 1,000 liter tanks or more. That challenges the processing and increases the time and cost. So let me give you one example. The most highly consumed enzymes are typically in next-gen sequencing, and one of them is the library prep stage. When I say consumed, that's an important word. So these are not recycled enzymes. These are consumed one time, they're utilized, they're broken down. And that's important because you have to be able to think I need constant new enzymes in that process. One of the manufacturing enzymes -- one of the enzymes we manufacture, we are 16x more efficient than our competitors. You may ask, how do we know that? Well, there are things that we can glean from not only press releases, certainly during the pandemic when we saw people getting money for scaling up, and they often talked about the scaling up process. But also, we have a number of folks that have been in those other organizations. We know what it looks like. So think about it this way, if our competitors are using a 750-liter tank for that enzyme, we can manufacture it in a 50-liter tank. That's tremendous, not because of this -- it may not seem like a big deal for that, but the reality of it is, the downstream processing of that is tremendously different. You can now process it faster, you can harvest it quicker, you can purify it better. And what I mean by that is you can take tighter cuts of the chromatography steps and you can actually get better product, and we can get better product, but actually more than our competitors can, because we optimize the efficiencies of manufacturing. And if you think about it, some of our competitors are actually outsourcing a number of these unit operations. When they do that, they get put in a queue at a bioproduction facility months out. So we discussed our internal innovation and our manufacturing expertise. We also look to expand our enzyme portfolio as well. This is key. As I mentioned, we have a partnership that's publicly known. We have partnership with a premier enzyme engineering firm, Codexis. We also right now are working a lot with in-silico design firms. These firms 3, 4, 5 years ago didn't exist. These are alleviating a lot of constraints in wet lab chemistry to manufacture new and novel content. And then we're also looking at how do we partner with academics. This is something that our competitors won't see predominantly. Our academic friends come to us and they say, we need this enzyme to be manufactured. It's unique. It's novel. We've created it. By the way, we have very limited funds, but it's something that addresses something in the market. For us, we could take that in, manufacture at small scale, put it in the hands of a whole bunch of other folks who want to see if it works. And at that point in time, we can be creative on our licensing situation. Those are the types of engagements that are -- the folks that are doing this at the large scale actually cannot do or don't want to. Also, we differentiate ourselves through customization. Our competitors are often looking at things through the scale of, "I don't want to change things because it really means I have to create a factory within a factory." And what I mean by that is if something is fully baked in their catalog organization, they don't want to change something as small as small as a salt concentration, if you will, in a buffer for a customer. We do that every day. That's what we were built on. As the bioeconomy matures, you will see that these new novel enzymes will come more and more to the forefront. And the challenge with that will be that they require tuning. And what I mean by tuning is, think about it this way, from the car model that we talked about, if you take a car and you put it on a racetrack and you tune it for that track, it does phenomenal. It's the fastest car on that track. You take the exact same car, you put it on a different track, it has to be retuned. Well, the enzymes that we have right now, a lot of them in the catalog space are great. They're wild-type enzymes. But as we bring new and novel engineered content to the marketplace, those need to be retuned for a lot of different applications. They don't have millions of years of mother nature perfecting them to be able to address a wide span of applications. And so the tuning of those enzymes will become more and more necessary every day. So to kind of sum it up, we contribute to driving innovation through a number of different ways. First and foremost, and I think it's the best way that we align with Maravai overall is actually our customer engagement. We look at every engagement through the lens of the customer. Every one of our engagement starts with the question, what does success look like for you? That's extremely important. We drive efficiencies through manufacturing. We now can bring new and novel content to the forefront for our partners at TriLink and also for the other businesses that Maravai has. And we leverage that all through a quality umbrella that I think is top notch. Becky can talk a little bit more about the commercial team. But as Trey mentioned earlier, the commercial team for Alphazyme this time last year was me and one of my other cofounders. We've expanded that now to 4 people. We have a Head of Commercial, allowing me to do other things. And then also, we look at that as continuing to expand and investment absolutely in the future of enzymes. So I'd wrap it up with this. I am proud to say that we do all of this with the most dedicated and talented team. The folks that we have at Alphazyme are top-notch. They work their hearts out. And it's a privilege to be able to lead them every day. So with that, I'll turn it over to Becky, and I thank you all for your time today.

Hi, everyone. I'm Becky Buzzeo. I am the Chief Commercial Officer at Maravai, and I'm also the Chief Operating Officer for our Services division. Although I do have 2 roles today because it's R&D Day, I'll be focusing on telling you a little bit more about our Services division, giving you a better look into that and getting you really defined on what we mean by services. And so when we talk about the Nucleic Acid services, it's our RUO, our research-grade use only mRNA and our GMP mRNA services. We have a lot of other services, as you heard Chad talk about and you heard Drew talk about, there's custom services across our portfolio. But when we talk specifically about these services is our mRNA manufacturing services. So what's fueled our growth and relevance of this mRNA manufacturing services is that we've been there from the beginning. Customers have leveraged our mRNA manufacturing experience, and they really have taken our -- leveraged our experience from their research all the way into GMP. And so there's a chasm that you have to cross to really translate those R&D discoveries into the clinic. And a lot of times this has been called the valley of death. It's where good molecules, good medicines go to die, because maybe they run out of time, companies ran out of money. They didn't do the right things upfront. And so how do you look at that entire process and offer value to these new molecules in mRNA. I think we have a rightful place to play here. So careful consideration of the quality of raw materials is crucial to that robustness of the processes. And so you heard Kate talk about our innovation, Drew talk about those TAP technologies, the NTPs, and then you've also heard Chad talk about enzymes. They're all inputs to how you make mRNA. And so the uniqueness of our company is that we manufacture these raw materials, and then we put them in the process, and we have experts that understand that. And that's a huge differentiation in the market. I'm going to talk about that today in the talk. So plasmid DNA, Kate told you, that's really the input, right? You get your plasmid, you linearize that. You have NTPs in that reaction. You have your CleanCap analog, and then the enzyme does the work, and it makes that mRNA for you. You then purify that mRNA. We had some things grayed out on the previous slides, but most customers are going to need to encapsulate that. You can't put that in your body. Your body will automatically degrade that. Cell therapies ex vivo have a little bit of a different application where they don't need to encapsulate because they can electroporate that mRNA straight into the cells. So we play in both of those arenas. At any rate, you fill, you finish, you package it up in that secondary packaging, and then it goes to the patient for administration or to that clinical trial for administration. And so like I said, the services really -- oops, sorry about that. There you go. Services brings our portfolio together in a very unique way, and we call this the highway by which our customers enter our portfolio. They typically come to us and order research-use grade only mRNA. And then as they look to progress that program, they then ask us to make that material in GMP. And I want to also highlight that mRNA manufacturing and making mRNA is not a commodity. It's not been around that long. There's been a select few groups that have done it. But we have 20 years of experience doing that. And that has put us in a very differentiated position. We've manufactured over 100 GMP batches with over 70 different constructs. And we have made over 16,000 RUO constructs with over 1,000 clients. Totally unique position. And that expertise allows us to see a lot of things, be able to be of value to our customers. And I'll talk about what that value really is. So again, we position this legacy of trailblazing innovation and discovery to win in discovery. This is where the majority of the customers are today. They're in that discovery and preclinical position. And our clients typically start working with us by purchasing that research grade-use only mRNA. What are they doing with that? They're screening, they're developing, they're scaling up their processes. They're overcoming challenges. They want to get to the market faster, but typically, in that R&D, they haven't even identified their target yet. Once they have moved through that, it's all about agility. How do you get to your Phase I, how do you get to that filing, and being able to translate that process from what we do in manufacturing that RUO grade material can translate right into our GMP suites. We've got scalability, we have process development, quality, facility fit, and we do shorten those time lines with our supply chain. Additionally, we talked about offering plasmid. We have both partnership and in-house plasmid manufacturing, and that's a very sticky business. Customers want to have the service provider manufacture their plasmid or to secure that plasmid for them and then do the mRNA. Again, mRNA not being a commodity, I think it's extremely important that that's where customers make choice on who they're going to choose as their service provider, that expert for the mRNA production. So talked a little bit about our differentiation, but this is how we see it really crisp. First is speed. I talked about that in discovery. It's all about how do you move fast? How do you test those modifications? How do you choose a target? And researchers want to fail fast. And we have that ability to do that and help them with that. Second is scale. Again, you're talking about in research grade, very small quantities of materials, microgram quantities. So how all of a sudden you get to hundreds of grams of material in a GMP suite. Our CleanScript process can scale from microgram to hundreds of grams in GMP. Third is quality. Kate talked about that everywhere we go, our customers are extremely appreciative of the quality that we have in both our innovation and then our manufacturing processes of those critical raw materials and quality the same way with services. How do you guarantee what you're doing in your suites and in that tech transfer is translating? How do you have process analytics and actually give it a data-driven result and have a robust QMS system that's critical to creating that quality environment? Highway from RUO into clinical trials requires a comprehensive understanding of the processes and methods used, and any misalignment increases the risk associated with the program cost, safety, and eventually the success of that program. So I want to talk a little bit about what we're investing in and how we're expanding our capabilities. First is through facilities. Second is analytics, as I briefly touched on. And then the next is because services is all about people, it's about your experts. You saw a little bit about our actual physical facilities from Trey. I'll just highlight where the services team and what facilities we use within Maravai. First is Wateridge. That's where all of the services are coming out of today. All of our products are being manufactured there. So it's a fully functional site. It's 132,000 square feet. And the very uniqueness around this is that we have our R&D, our process development, our RUO team and our GMP team. That's an amazing amount of collaboration, because, again, when you think about how these programs interact, these aren't -- services is not transactional. It's very collaborative, and it's iterative. So to be able to have the same access to a team that makes your research grade, then goes into a process development, and then tech transfers that into your GMP suite, it's a huge differentiator. From there, how do you continue to follow that molecule? Well, Flanders 2, we announced that site. We took occupancy in June. This site is 32,000 square feet, 4 GMP suites, as Trey said, and this manufacturers late-stage manufacturing. So you do your early stage Phase I out of Wateridge and then tech transfer 3 miles up the road to the Flanders 2 facility. Super seamless. We're looking to be GMP-ready mid-next year. It's a great time because we have a number of customers that are really exploring who's going to be their late-stage manufacturing partner. Flanders 1 is on there. And this is the site that makes our GMP raw materials, and this is just highlighting that we're vertically integrated. Flanders 2 is right next to Flanders 1. And so again, that's a unique experience, too. Our MSNT lab is in Flanders 1. Flanders 2 has the GMP, QC, QA, full release, and stability testing there. So let's talk about our analytical capabilities. This is a huge differentiator for us. A well-designed program needs an analytical road map. And so this is to really ensure your CMC data requirements. So many of you probably have seen in news, "oh, that program failed. This CDMO is under inspection and CMC data package is incomplete." Typically, it's your analytics that have gone wrong there. Customers haven't invested. They chose the wrong partner. And this is where it makes a huge difference on what you're choosing, at what phase, and are you working with a team that can collaborate with you? So good analytics are essential. Why? You got to get your consistency batch to batch. You have to show the regulators that you're making the same thing, the same time, the same way. You've got processes that are repeatable. You have quality of the incoming raw materials. So essential. So you monitor things like identity, purity, integrity, residual contaminants, yield, potential of any other vital modifications that are there. And we do offer this in a phase appropriate way. So you can see in discovery, you're moving fast. You're not going to spend a whole lot of money. So we have generic methods that are used there. As you continue on into Phase I, you have better package. You need to be able to show the safety of that molecule. As you go on to late phase, you're going to start to do a PPQ campaign. You need 3 GMP runs that operate the same way, and how do you do that is through your analyticals package. We have people on our team that have PhDs, tremendous amount of experience there, and we bring in those assays and the critical instruments to run those assays. And again, that's a unique position. Many CDMOs are outsourcing some of these things. They don't have the talent, they don't have the budgets, and they outsource that part of the continuum. So let's talk about the team. Services is all performed by people. You got to have people that know what they're doing. This is the difference between success and failure. Comes in many forms, manufacturing operators on the floor, the chemists, the biologists making plasmid, very different than making a CleanCap molecule. Again, those analytics, have to have an engineering team that really understands that equipment, the site, how to keep the regulations. I know you've heard this a couple of times. We have 20 years of experience doing this, and we've scaled with our customers. And I think that's extremely important. We've also experienced very low turnover rates. That's not -- that's also unique. CDMOs typically experience very high turnover rates. Last week, as Trey mentioned, we had our mRNA day, and we had 30 customers, 25 different companies that we invited in to get feedback from. And it's always refreshing. I mean, everyone, unsolicited. You talk to customers and they're like, you guys are clear experts in mRNA. And I think that's really a cornerstone of who we are and who our brand is. Okay. So I'm going to pivot a bit and talk a bit about our innovation and services and how that's driving even further differentiation. Okay. So I'm not going to teach you about CleanCap. You heard that from Kate and Drew. But what you can see from this slide is what, right? Less steps. No one can argue the simplification of the manufacturing of mRNA using CleanCap. And you hear it on our website, one pot, it is really why people choose to use CleanCap. And I want to just bring that home a bit, because services, again, the whole idea is about getting into the GMP suite. And if you think about it, GMP operators are in these clean rooms, they're fully suited up, and they have to adhere to GMP guidelines and CGMP regulations. And so that means they have to follow a script. Those are called batch records. And this requires robust documentation. You have to have training for every operator, and they have to fully grasp what their responsibility is in that GMP suite. And any change to that batch record or any change to the behavior has to be documented. And if it's either done in a way that is noncompliant, it's called deviation, and then deviations need to be further inspected. This can cause tremendous amount of delays. It could cause waste as far as kind of scrap the batch. And you really have to prove that you have followed the instruction. So CleanCap having less steps is so important, it's simple, and it works, and you get better results and less scrap from a services standpoint. And as Kate has outlined, there's also technological advantages to the capping technology as well. So let me give you an example. I've got a couple of customer examples that I want to highlight here. So this is a true example of a customer. We brought them in through our RUO portfolio. They then had us make Phase I material. And you can see the thing labeled current process is their Phase I manufacturing process. This molecule is actually moving into Phase II. They want to be making their Phase II material next year. And they know that taking that Phase 1 process is not going to scale for reliability. So many of you guys are probably scientists in here, too. I mean, you can see a couple of things right away like the phenol–chloroform. That is not a commercial manufacturing scale stage. You don't only bring that into commercial manufacturing. So what we've done is we've worked with this team to optimize the process. We've taken steps out. We've added different technology in. And we're doing that comparability study where we've made their Phase 1 material and we're talking to them today about moving them over to Flanders 2 because their time lines hit are time lines for readiness. And so this is incredibly important and I think this highlights many examples of how we're partnering with customers and continuing to scale with them and their needs into late phase GMP manufacturing. The second is just a very typical example of that customer coming in, doing discovery, buying RUO material. This customer started with us in 2018, but about $100,000 in RUO-based material, they started to scale up a little bit because they were doing their formulation developments, they needed more materials to do that, and then they buy their Phase I. In 2021, we received an RFP from them. We won that business and we did the manufacturing in 2022 of that material for Phase I. This customer is going to be also going Phase II in 2024 and a really nice glide path to be able to service them and continue on with their clinical trial. So let's talk about the other side of our business. So you've got how we're expanding out and keeping that customer through GMP and later and later. And how about earlier on, you think about today when we go to market, we have a 1 milligram scale of RUO mRNA. That's big. It's too big. We're missing a front end of the funnel that is scaling down and doing a lot of screening. And this is arguably a more significant part of where services can expand and create a bigger breadth of that discovery business coming in. One, it's pretty consistent; two, there's a lot of entrants into the market and it allows us to really expand out into additional markets like the academic market. So I talked about speed being really important in discovery. And so a couple of things I just want to highlight in what we're doing to enable speed. So first, we have to identify a quick solution for DNA. Today, it's about a 1- to 2-week turnaround time. Kate talked about some of the other options in plasmid, not just using fermentation free to plasmid but also doing it through chemistry. The other is integrated e-business. So how do you do from quote to manufacturing and all the way really to cash, but truly that quote to manufacturing, bringing a Leland system that is streamlined. Automation. Automation platforms that actually do the manufacturing, quicker turns and then this queued optionality by case. This really talks about you don't need all your modifications on that research bridge. You don't need it to be necessarily as clean as you would need something that you would be putting into a full formulation development in your LNP and making sure that we've got kind of how do we look at that optionality that's appropriate for when customers need to get that product and then the ability to scale. Anything that we do, I said it's critically important that we get all the way into the manufacturing floor in GMP. I mean that is so important. So if we change that scale there, making sure that we do that so that we continue that value proposition. Okay. So here's an example of what we've been doing this year and I think this has been super awesome and fun to work on. Unfortunately, we got ourselves into a really long turnaround time. You've heard some of us talk about this in the earnings calls. That in 2022, our average turnaround time was between 8 and 12 weeks. We've been able to claw that back and really cut that in half consistently since January this year, which has been huge. And so how we done that? We've removed things out of the process from how we receive inputs from the customer and how we do quote generation, how we accept those orders and actually write up the work order. We changed things in our manufacturing as well as we've moved QCs into that lab to claw back time. So that's, I think, great for us. We did some real process improvement. That's what we call find a better way, super excited about that. The other thing that we've done is we piloted into a microgram scale. This is giving us a test case. Can we get lower, can we keep our costs low and can we actually deliver and hold our margins. And that's -- we have a really nice test case there. Again, we showcased both of these in our find a better way day. And I think this really gives us a clue on the treasure map that we're heading in the right direction. So look, I'll summarize here. We're well positioned. We can go from microgram scale to hundreds of gram scale. We have a clean -- that clean script process is our platform by which we do that and we can take that to GMP all the way into a commercial manufacturing environment. Our expertise is key. It helps us see risk for clients, and we're repeatedly consulted for that. Look, we're not only in the COVID vaccines, we supported in services quite a bit for that as well. But this just gives you a little bit about the diversity of the customers today in the services. You can see that we're very heavily in solid gene therapy, protein replacement as well as the cancer vaccines. It's great to be in those high-growth markets, and I think that's where our customers see a lot of value in coming to us. So I'll have this home a little bit. Everybody is kind of ending with how do we fulfill on the value of Maravai. And I think services fits squarely into that. We are catalyzing that customer journey. We are integrating plasmid. We're going upstream and downstream from our current services so important to our customer base. We're finding a better way because we're challenging ourselves on turnaround times and how we support that CMC documentation, so incredibly important customers, delivering that unquestionable quality, very focused on our analytics and then upgrading our systems and blenders to a robust and best-in-class quality management system and then lead together all about our talent. We do a lot of training and development in services, one because we have to and we're regulated to do so but also because that's where we see the most value in our team. So just leave you with this. If we were a company that just had products, we wouldn't really understand how they're used. If we were a company that just had services, we wouldn't understand the products and how to get the best out of them. And I think that's the true value of what TriLink inside Maravai has to offer to the mRNA community. So thank you very much. And I'm going to now introduce the break, which is right out in the lobby, and we'll come back and talk about our biological safety testing division next. Thank you. [Break]

Now. Please welcome to the stage Maravai's Chief Operating Officer, Biologics, Safety Testing, Christine Dolan.

Welcome back, everyone. I'm Christine Dolan, and I'm excited to take you through the biologic safety testing overview and strategy with my team, David Cetlin and Eric Bishop. I don't have a clicker. Okay. Cygnus Technologies was founded by the great innovator, Ken Hoffman in 1997. As the biologics industry was starting to take off, there are no commercially available analytics to prove the safety of drug substances that were being developed and commercialized. Ken authored a paper in 1997, demonstrating his application of the ELISA assay technique to host cell protein detection that would give drug developers the information that they need for safety profile expectations. In 1999, the first commercial kits were launched for the 2 most widely used cell lines in the industry, E.coli and CHO. A multitude of additional cell lines and bioprocess impurity detection kits were developed and launched, and notably, in the year 2010, a kit for HEK293 hostile proteins was introduced with little adoption as the cell and gene therapy market was just getting started. Ultimately, as this market started to bloom, the Cygnus kit was and is the only commercially available off-the-shelf generic kit. The adoption was fast and furious and sales topped $10 million annually. Over the years, Cygnus has continued to innovate, adding a portfolio of host cell DNA detection kits in 2012 and launching the best-in-class protein A mix and go kit in 2013, which relieves the scientists of burdensome sample preparation. During our 25-year history, Cygnus has developed an industry-leading 24 cell lines and 24 bioprocess and purity kits 10 times greater than any competitor. In parallel, we have augmented our extensive product portfolio with specialized orthogonal services, including antibody affinity extraction or AAE and mass spec services to round out our superior end-to-end product and service offering. Finally, with the acquisition of the MockV portfolio, we now have the opportunity to introduce a disruptive technology for the viral clearance market in the same way Cygnus defined the HCP market. Cygnus plays a significant role in complex biologic manufacturing design and assurance. Our kits and services enable developers to demonstrate process consistency and ultimately ensure the safety of their products. Host cell proteins and other bioprocess impurities can interfere with drug performance as well as potentially contribute to adverse effects. Our tools give confidence for success through to commercialization. The regulators have issued guidance that developers must comply with. And some of these guidances are still being developed as the industry evolves and grows. Cygnus' reputation puts us in a unique position to influence the outcome of these regulations. As leaders in this space, we have earned the distinction as the gold standard for host cell protein detection with our industry-leading portfolio augmented by our specialized offerings in AAE, mass spec and process-specific assay development. Our deep bench of tenured scientists provides expert consultation for customers to ensure their success. Our established thought leaders initiate and sponsor global technical discussions, publications and conferences. Our gold status standards is validated by the fact that we feature in the significant number of filings for biologics and biosimilars in all 17 of 17 CAR-T cell and gene therapy drug product approvals. As the established market innovator, we have defined the host cell protein detection market and have remained the leader by continuing to innovate and expand our offerings. We have accomplished strong year-on-year growth and despite the post-COVID normalization of our revenues, we continue to maintain high operating margins. And I'm pleased to announce that in July of this year, we had a historic milestone of $500 million in revenues. With our continued investments in talent, infrastructure and innovation, we are well positioned to capture all future growth and we have a proven track record of providing innovative products prior to industry needs. We talked about our extensive portfolio of products and services. And this full-service offering supports our customers through their development and commercialization processes. During preclinical and Phase I, our generic kits provide critical data needs to make process engineering decisions regarding interiorty profiles and as developers move to the later phases of clinical trials and home in and validate their manufacturing processes, our kits and orthogonal analytics are critical to these final decisions as well as proving regulatory compliance. Our kits and services are well regarded by regulatory bodies and Cygnus is named in the CMC section of new drug applications. Finally, as a drug is commercialized, our products are used for lot release and any product enhancements throughout the drug product life cycle. It is important to note that developers engaged with us early in the development cycle. This is necessary as our tools enable critical decisions during process development and scale up. This front-end engagement means that we are providing our kits and services for all potential drug candidates when pipelines are taking shape. As few as 10% of these candidates make it through to approval and commercialization, therefore, we serve the largest population of programs. And because of the stickiness of our products and the services that we provide for the few that make it to the market, Cygnus is with our customers and their products all the way. So for all pharmaceutical developers from the large blue-chip biotherapeutic companies to CDMOs, to innovative start-ups in the cell and gene therapy space, we serve thousands of customers on a global scale. Now Eric Bishop will discuss our biologic safety testing innovations. Eric?

Good afternoon. Thank you guys all for joining us today. Again, I'm Eric Bishop. I'm the VP of Research and Development at Cygnus. As Christine has alluded to, our company was founded on a principle of continuous innovation and value creation. And I guess the point of me being here today is I really want to talk to you guys about what we're doing currently at Cygnus to turn these ideas into concrete products and services that we offer to our customers. So today, we'll start by talking about ELISA kit expansion, how we make the choices of which kits to offer our DNA portfolio expansion, our mass spec orthogonal service testing as well as the MockV product expansion. So I think this is a good slide to show. One, when we talk about be the customer's first choice. And we couple that with the fact that we are the industry gold standard. You can see why customers may come to Cygnus when they start a new product. This is specific for cell and gene therapy. We have all the analytics in place for host cell proteins for media additives as well as some of the common purification leachates as well as enzymes use processing. So when a company is starting out to start a new project, rather than invest a couple of years in developing analytics to support these products, they can come to Cygnus right off the shelf, we have them available for the customer. The other thing I'd like to point out here is that we have some opportunities. So we currently have host cell protein kits as well as all the others for about every expression platform that's used in the industry. We're now developing the residual DNA assays to complement the host cell protein. So with us a lot of times, again, customers and people say to yourself, say, how do you know when to make a new kit? What kits are you going to be working on? So we were able to choose a lot of our innovation with respect to host cell proteins. We spend a lot of our time reading papers, visiting customers, going to industry conferences and really just kind of read the tea leaves about what's coming up, where are we starting to see. In this case, PG-13 is an excellent example. In the cell gene therapy is used for retrovirus production as well as a packaging cell line. And it really started just kind of coming up here and there. We made the decision to invest in developing the analytics for host cell protein for PG-13. We launched that kit in March of this year. And we have already had good uptake in Asia as well as quite a few repeat customers in the United States. So just like ATK in 2010, we feel this could be a very important product in our portfolio going forward. So as I alluded to in the previous slide, we do want to make residual DNA assays to complement the host cell protein ELISA kits that we already offer. We're not starting from 0 here. So we developed, especially our DNA extraction kits back in 2010. We feel this is probably one of the best, if not the best extraction kit on the market and the fact that we can recover femtogram levels of residual DNA in the presence of milligram of product. We also do not require a high level of expertise to run these methods. It doesn't require additional instrumentation and we do it at a price point that's very competitive to any other kits on the market. So that said, going forward, over the next immediate future, we're going to develop some of our CHO and E. Coli to USP compendial methods and then we're going to look to build out again to the common expression platforms across the industry. Longer term, we're looking at digital droplet PCR, which is a way to do absolute quantification of DNA. And then as we feel necessary or needed, we may explore some automation partnerships in a similar manner that we have with our host cell protein analytics. So now I want to shift over to mass spectrometry orthogonal services. And I want to start a little bit about highlighting some of the innovations that we've already bought to the industry, and then we'll go from where we're going forward. So right now, Cygnus technologies is the world leader in host-cell protein analytics with respect to mass spectrometry. We've always known that mass spectrometry would play a big role in host cell protein. But if you look here on the bar chart on the far left, you can kind of see the challenges that we've had historically in that if you just look at drug substance in mass spectrometry, these detectors are completely saturated by the heavy in this case an antibody, so it's heavy and light chain peptides from the drug substance. So you can see you see a lot of that and very little insight into the host cell proteins that are in the drug. We couple that with our antibody affinity extraction, which is the bar chart on the right. And you see we can greatly reduce the product-related peptides and enrich the host cell proteins. We've known this for a couple of years. And what we found is it really is the first time in the industry that we've had the ability to truly understand and identify all the HCP that are in our drug substance. It's never been #4. Historically, most of our customers thought they might have 5 or 10 host cell proteins. Turns out most of them have a lot more than that. But what that means is that for the first time, they can also do meaningful risk assessments. So they can look into it assay. These are exactly the host cell proteins we have, and we can identify you -- is this a lipase or a protease that's going to cause a problem with patient safety or drug stability and they can address it before they get too far down the road into the clinic. So it's very valuable to our customers and obviously, overall to the industry. So again, we're a company of continuous innovation and value-added. So right now, our host cell protein ELISA will tell you relatively how much host cell proteins there. It really doesn't tell you anything about what specific proteins are in that mix. Our mass spec is starting to do that, so we can tell you exactly what's there. But current technology doesn't allow us to tell you exactly how much of each of them are there. We can give you kind of a relative measurement. So we're in the process now of developing heavy labeled peptides for these individual problematic host cell proteins. So going forward, we'll have libraries of these peptides. So anytime that we identify proteins of interest that we need to quantify, we can use these heavy level peptide controls and tell you what proteins are there and exactly how much of each of them. So it's going to be a big step forward and again, helping our sponsors provide the most safe drugs and giving themselves the best chance of success in the clinic. So again, I'll try to be very brief. So we'll turn it over to David Cetlin. He's going to do a little bit deeper dive into our reproduct expansion.

Great. Good afternoon, everyone. Thank you, Eric. I'm David Cetlin. I'll take you on a deep dive. I'll be your dive master to MockV. So viral clearance testing, it occupies an important niche within the biological safety testing landscape. For any biopharmaceutical produced in mammalian expression system, you may be you're familiar with CHO. The manufacturing processes ability to demonstrate effective viral clearance is actually mandated by international regulatory agencies. This is done so both prior to and post clinical studies. So at 2 points filing an IND or filing a BLA. This is required. Currently, and for the past 3 decades, the means to do this has been through live mammalian spiking studies. In these studies, virus is propagated, spiked into biopharmaceutical material and process through a scale-down model of the biopharmaceutical manufacturing process. These studies require specialized facilities, which typically lead companies to contract CROs. The economic and logistical hurdles presented by this paradigm limits the amount of viral clearance data accumulated ahead of these regulatory supporting validation studies. This, in turn, leads companies to develop their manufacturing processes in the dark as it pertains to viral clearance, which increases the risk of validation failure. The MockV approach to viral clearance alters this paradigm. It provides a novel and patent-protected solution to this problem. This is accomplished by replacing the live viruses used by the CROs with noninfectious mock viral particles. These are engineered to exhibit very similar physical chemical properties to those very same viruses used by the CROs. These MVPs are provided along with all the required quantification components in kit format, enabling our end users to conduct their own mock viral clearance spiking experiments. A multifaceted value proposition is provided to our customers. First, the cost savings of conducting a MockV versus CRO-led experiment is substantial. You see that here on the chart. About $400 to $1,000 for MockV study versus $2,000 to $10,000, but that really doesn't capture the full value saving. Let me explain. So the ability to conduct a MockV experiment occurs in a customer's own lab under BSL-1 conditions. And that is extremely desirable. This is made possible due to the fact that our MVPs are noninfectious by nature. And in contrast, companies that contract CROs must attend their studies at the CROs, BSL-2, BSL-3 suites. So this adds tremendous complexity and costs as the shipments of all materials, the transfer of all methods and the planning of all team travel must be properly accommodated. In addition, the companies must execute these experiments flawlessly while on-site at the CRO. These facilities are booked up 9 to 12 months in advance. So as soon as one study is done, the next group is coming in. There's no time -- there's no wiggle room. There's no room for error. Finally, but more importantly, the turnaround time of analysis. Data from several MockV experiments can be analyzed in one workday. This is made possible due to the high throughput nature of our assay platform. In comparison, the plaque assay based method of analyzing live viruses take CROs several weeks, if not a month to complete. These value drivers allow customers to overcome the barriers discussed in the previous slide and optimize the manufacturing process to achieve effective viral clearance. Since introducing this novel concept to the biopharmaceutical industry, we've enjoyed certain accolades such as winning the Bioprocess International Readers’ Choice Award in 2021 and most recently in R&D 100 award in 2023, but no accolade outside the positive feedback that we have received from our customers. On this slide, you'll find quotes from 2 of our customers and their sentiments validate both the necessity of this enabling technology and the value proposition that we've highlighted on the previous slide. Through the combination of providing disruptive novel products and laser-focused customer interactions, we've begun to alter our customers' purchasing behavior. Increasingly, we are seeing repeat MockV purchases, mainly from large biopharmaceutical industry leaders. The early adoption of our MockV technology by these leaders translates directly to increased revenue but also serves to lower the barrier of adoption for industry peers whom otherwise would be on the fence. Maravai is investing in the future of the MockV product portfolio by promoting the R&D efforts required to expand our pipeline of kit offerings. As seen here, both the MVM and our VLP kits are already commercially available. These kits mainly address those customers working with CHO expression platforms, which covers about 70% of the global monoclonal antibody efforts. In 2024, we aim to release an SV 40 kits, which will address the specific viral clearance needs of global gene therapy developers. And in 2025, we anticipate the release of the fourth MockV kit, which will be determined at a later date. In late 2022, an exciting development occurred in the viral clearance world, which pertains -- which presents several favorable outcomes for the MockV product line. Further strengthening our position within the space. The ICH Q5A harmonized guideline is the regulatory document used internationally to govern viral clearance validation for late-stage biopharmaceuticals. Last November, a revision to this document was drafted, the first such revision since 1999. As can be imagined, this revision needed to address the impact to viral clearance from many technological advancements made since the previous revision. Some of those advancements including continuous processing, the emergence of new product modalities such as cell and gene therapies, CHO-endogenous RVLP and the concept of prior knowledge. Each of these concepts aligns very well to the MockV approach. And in fact, we've published scientific data on the topics of continuous processing and gene therapy. But in the next 2 slides, we'll highlight the later 2 concepts as they have the potential for profound implications. So historically, our customers utilize MockV kits for process development and optimization efforts. They still rely on the CROs for the final validation study. What the revision to Q5A makes clear is that "For CHO cell derived products, CHO-derived endogenous virus particles can also be used for viral clearance experiments." In November of 2022, Cygnus launched the RVLP kit. This kit contains RVLP derived from CHO cells. What this means is that customers can now consider validating their process through the use of this kit. Indeed, we've been approached by and are in communication with several large biopharmaceutical companies to explore that very possibility. In the near to mid-future, we predict a gradual replacement of CRO led retroviral clearance studies with data derived from the MockV RVLP kit. Finally, the concept of prior knowledge. Basically, this term refers to all the viral clearance data that a company has amassed over the years from similar manufacturing processes. Maybe you've heard of platform processes, same thing. The idea is that if sufficient data has been generated, it may be leveraged to reduce the scope and need for additional CRO led viral clearance validation studies. The trick is in order to convince the regulatory agencies, a winning justification needs to be put forward. The MockV approach offers an economic and easy way to accumulate viral clearance data. Through this data, companies can increase their process knowledge, leading to better justifications. In the end, supplementing a company's existing prior knowledge with MockV derived data could effectively reduce the scope and/or need entirely of conducting process-specific live viral validation studies. As we've discussed, our customers have historically utilized our MockV kits for process development and optimization efforts. Although these areas of use will continue to remain strong, the revision to Q5A to include both RVLP and prior knowledge expands the potential of MockV kit usage. Now validation activities both prior to Phase I and clinical studies and in support of BLA approval could be supported through the data derived through the expanding kit portfolio. In summary, MockV will be a solid contributor to biological safety testing revenues in the near and long term. We address an unmet need in the biopharmaceutical process development industry. Our underlying technology is built upon the use of noninfectious viral surrogates and is patent protected globally. We have a rich pipeline of kits under development and expanding cases for opportunity, thanks to the recent regulatory developments. Now I'll turn it back over to Christine.

So thank you, David and Eric. As you can see, Cygnus has a long-term strategy that incorporates the founder's innovative historical approach with our Maravai priorities. As the host cell protein detection market leaders, we understand the privilege is something we should not take for granted. And so we are continuously improving to maintain and uplift our gold standard status. With this, we cultivate our customer relationships and ensure their success. And as Eric and David have highlighted, we have specific focus areas with mass spec and our proprietary services and an opportunity to disrupt and create a new market with MockV viral clearance prediction. We will leverage this to increase customer acquisition and expansion. After a quarter of a decade, this continues to be a great business supporting a growth market. And finally, our Maravai priorities guarantee the innovation focus for the Biologics Safety division. We spoke about leveraging our expertise and strong industry and regulatory partnerships to catalyze the customer journey. We strive to find a better way by building our pipelines and investing in orthogonal services and host cell protein detection in the new markets including DNA detection and viral clearance prediction. We are continually focused on delivering unquestionable quality. Our customers expect this from us and is what clearly differentiates us from any competitor. And finally, with Eric, David and our deep talent benches, we will continue to be established thought leaders in this space. Thanks for your time, and I'll turn it over to Kevin.

I am Kevin Herde, CFO and I am today's closer. So let me get through this relatively quickly so we can move on to Q&A. I'm going to be going over kind of a summary of what we talked about today, talk about our long-term targets, some of our capital allocation and then bring us home. I will not be covering the expectations for the quarter, short-term financial results. We will cover that as we usually do with our quarterly call, which will be upcoming here for the third quarter and the early part of November. So let's move ahead. So as Trey talked about, we're pretty dynamic life science companies. You've heard about say from the numerous speakers and a very strong financial position. We operate in the markets that we think are very attractive and have favorable macro trends over the forward-looking 5-year strategic window. We're going to drive future revenue through a combination of leveraging our already established capabilities, continuing to innovate and continuing to use our cash flows in the most appropriate way, and I'll talk about some of the ways we plan on doing that. And lastly, I think as you've seen historically, as we grow revenues, we have a great ability to expand margin, and that's going to be a key part of our story going forward, expanding revenues, driving revenue growth and expanding margins over time, and that will be part of our bottom line profitability expansion targets. Just to circle back, what Trey touched on earlier. We like the markets that we're in. We believe in the CAGRs about greater than 14% for nucleic acid production, about 10% of the biologic safety testing market and a rough doubling of the market over the next 5 years. And we have historically done better than market growth just because of the excellence and quality of our products and our services and the uniqueness of our offerings. Again, not really in the commodity side of these markets, but really unique specialized IP protected, good know-how, really unique products to help our customers with their end solutions and products. In a history of strong business growth, we've done this before. We've grown at these rates. We can -- we believe we'll continue to do so, grew 23% from 2018 through 2022 on the base business, excluding the clean cap benefit from the COVID pandemic. And even in '23, where we're already all facing headwinds in our industry, we still see a very strong underlying business strength factors we continue to see, as Drew touched upon, new mRNA clinical entries continued demand for clean cap and good uptake for new clean cap analogs. So still some good underlying business strength factors even with a down year in 2023 that we're seeing across the industry. So as we sit here today, our long-term financial targets, we believe the long-term base business will grow by 18% in the forward-looking 5-year period. That gets us to about $700 million plus of revenue. That's organic revenue. I'll talk a little bit more about M&A initiatives, but that does not include contributions from M&A initiatives. We believe with that revenue growth, we can build up to a 40% adjusted EBITDA margin. I'll talk a little bit more about that. And we'll continue to allocate our capital in a disciplined manner, which will provide for EPS growth and continued strong cash flow growth. So the team is clearly focused, as you heard today, very engaged, passionate about what they're doing -- across our 2 segments that will lead to what we believe, driving this growth. So it's really about the products you've heard about today, the innovation, the high quality of the products that we offer. Chad touched upon the expanding capabilities we have in enzymes, emerging capabilities from [indiscernible] which is very important of our overall picture. We've also talked about Becky's conversation, the expanding capabilities and services and what that means over the 5-year window, a very important part of our overall story. And of course, you just heard from the team on biologic safety testing. We plan on remaining really to be the gold standard and industry leader in that business as well. So just summarizing on the revenue target, targeting $700 million plus of annual revenue in 5 years. That's an 18% CAGR, establishing -- with established growth drivers that we've talked about. And with that long-term revenue really comes margin expansion opportunities. We have a 22% first half 2023 adjusted EBITDA margin. We believe that we can scale that to greater than 40% with our revenue growth. That revenue growth at roughly incremental $400 million will come over a fixed cost structure that's in place today. We have the facilities we need. We have the capabilities and capacity as we finish lenders to support this 5-year plan without choosing up any more buildings. So we'll be able to leverage that fixed cost structure. We'll be able to grow our labor base at a rate slower than revenues, which will allow for further expansion. And lastly, we have a well-defined variable costs and raw material inputs. And so with those factors in mind, we know we can leverage our margin, leverage our revenues to grow our margin over time, and that is our target here in the 5-year window. So we see we have a strong balance sheet, strong cash position, very manageable debt position gives us strategic flexibility. So I'm going to talk about in the next few slides is really what is our capital deployment strategy, what do we look for, what's our history of M&A and why is it important to the Maravai story. So first and foremost, we're going to continue to invest in ourselves. I think you heard a lot of excitement, a lot of passion, a lot of good organic innovation that's Kate case brought to the table. We're going to continue to do that. We're going to invest in our people, our talent, our commercial team and expand that to drive our revenues. We're going to continue to be focused on innovation, again, targeting around 5% of revenues, continually invested each year in R&D to drive innovation and new products and organic growth. And we're very comfortable with where we are with our manufacturing capabilities. We'll continue to improve on those with regards to finishing of Flanders 2 and the quality aspects of that build out. And lastly, we're going to keep putting the customer first. I mean it's focusing on process, focusing on to some of the things that turn around time and some of the other things you heard about today, and that's really a mantra we focus on internally putting the customer first and investing in those processes. So the first allocation of capital for us is investing in ourselves in some of the pillars that you see here. Now we have a strong history of M&A, founder-based companies, very strong brands, leaders in their fields, very high science, loyal sticky customer base with powerful IP or know-how that's really provided a really wide, deep moat to protect our market share, and that's an important part of the franchise that we have here today. We've been acquiring these companies for almost 10 years now and it's become really a core capability competency of Maravai's to identify strong companies, negotiate successfully with founders and integrate these companies. And certainly, as Chad spoke to, I think we do a pretty good job with that. So we have a proven strong record of M&A. These are some of the last deals, some of the merger and acquisition criteria that they checked off for us. I think it's -- as I said, it's a skill to find and close these assets. It's also important that we respect the legacy brands, people and position of the companies to inquire even though we are Maravai, we go to market with these specific brands. These brands have a lot of brand equity from trialing to Cygnus, to MockV, [indiscernible] the companies that we've worked with -- we've brought them in with the either stood on their own or folded really tightly into our existing brands in those markets. That's been a very important part of our strategy for M&A. So as we go forward, we're going to continue to pursue opportunities like we have in the past. None of that's assuming these 5-year projections, but with our financial position and cash flows, M&A will be part of the story and be additive to the type of projections that we're showing you. We're going to continue to be focused on science, continue to be focused on bolt-ons inside our 2 existing segments, and that's to provide further attributes characteristics, scientific advancements for our customer base, and that's really where we're going to remain focused. I think you can trust we'll keep making smart capital decisions going forward. We have a team that is very good at both the practical aspect of doing acquisitions, knowing how to bring them up speed within Maravai, knowing how to get the most out of them well so again, respecting their legacy and also being able to digest highly complex companies or highly complex science is just a part of our everyday DNA. And I think we have a great team to take this forward. And certainly with Trey on board, that even gets a deeper understanding of this market, and we're excited about where we're going to go with future acquisitions as part of the Maravai's story. So last prepared slide. Again, just summarizing some of the things you've heard today, continuing to be the customer's first choice by focusing on best-in-class innovation and our products. Beat the trusted experts and people come to us and have for decades in certain areas like mRNA and areas like host cell protein and impurity detection. We are the experts in these areas. We're going to continue to focus on our broad and expanding portfolio. Our customers, the ones we have today and new ones and leverage our assets, again, to expand our margins. We have the assets we need and have in place to be able to meet our 5-year projections and expand our financial margins with this is even more strategic flexibility and creates value over time. So that's sort of the summary of what we talked about today. So on behalf of Trey, our CEO and the rest of the leadership team has heard of, we're going to wrap up here. We're really excited about where we are. Really excited about the next generation of Maravai using our extraordinary science to create everyday miracles for our customers. So thank you. We're going to take a quick 5-minute break, and then we're going to sit up here and answer your questions. Thanks a lot. [Break]

We are now entering the question-and-answer portion of the program. Please raise your hand if you have a question and a microphone will be brought to you. For our online viewers, please input your questions via the Q&A tab in the upper right corner of a video player.

[Indiscernible]

Sure. Well, I'll start. CRISPR is an incredible methodology, as most of you know, for DNA editing. The mechanism for CRISPR is -- forgive me, I always like to start with how it works, right? So CRISPR is guided by typically a guide oligo called the single guide or the guide strand. That's an RNA oligo. And the operating mechanism uses a nuclease, typically a Cas9 or other endonuclease, so you have enzymes and oligos once again, but very often in clinical trials, people are using an mRNA to express that into nuclease. So you have mRNA and you have oligos and TriLink has obviously a rich history in supporting both of those, and we've already had and produced many, many guide strand orders. So that's happening already. And we are, I think, very close to approval, we the industry, on a couple of different CRISPR blood treatments. So I would expect after the first approval that the industry is just going to take off. And again, it comes down to enzymes, oligos and mRNA.

Lee Lueder from Epoch Investment Partners. I was wondering if you put out EBITDA margin target, so what about free cash flow over the next 5 years, just conversion or margin or anything like that?

Yes. I mean, I think for us, free cash flow really adjusted EBITDA less our CapEx. I think this is a peak CapEx for us -- year for us here in 2023 as we, again, kind of wrap up with the Flanders facilities for the most part of at least material components of which we should see CapEx stepping down in 2024 and then really leveling off to close to maintenance levels. We don't have any more plans on larger scale investments in facilities because what we put in place over the last 5 years, as Trey talked about, really is going to support us for the next 5 years and potentially more. So as we look at that, it's really taking our EBITDA and it's going to probably be back in the neighborhood of that low single -- low to mid-single digits on top of revenue as far as maintenance CapEx after we finished the last part of this, probably in the first half of 2024.

So maybe, Craig, one for you on the transition from CleanCap M6. Are there any differences to be thinking about in terms of -- the first, in terms of pricing or margins, but second, also in terms of any regulatory hurdles that customers need to sort of navigate as they transition over the work to the [indiscernible]

The most exciting thing about mRNA in general is that fundamentally realizing the mRNA molecule is the same process, whether the end game is billions of doses of neoantigen for COVID spike protein or an individualized oncology therapy, and CleanCap is very similar. So CleanCap let's say, the co-transcriptional capping technology, the process is the same subtle differences. Kate showed, I think, some specific molecular differences between AG, AU M6 and so on. The molecules are so fundamentally similar, but they do -- small changes can lead to fundamentally differentiated results. They would need to be each independently clinically validated, of course. But the process, the realization of the molecule using all the different members of the CleanCap family is fundamentally the same.

Matt Sykes From Goldman. Maybe just one on RUO versus GMP. I know over the past few years, there have been a few contracts, have been losses you haven't been able to follow some of these products into GMP. But post Flanders 2, how do you feel you're positioned in terms of allowing for that customer transition from RUO to GMP? And then secondarily, Trey, you mentioned that not in the near term, but there was a blank spaces of encapsulation, fill and finish. As these programs are progressing, is that the type of investment you'd be willing to make given some of the capital intensity and other aspects of those businesses, so you can continue to follow the customers along that.

Very good and insightful questions. I'll take the latter and then maybe Becky hand you the first question about following customers. I feel like we, as a product and technology company first need to focus on the places where we can differentiate. It's extremely difficult to differentiate on sterile finish and fill compared to all the other steps that I walked through on the mRNA realization. So we really, at least this year, strategically focused there and with all of the EBITDA margin questions we get about how we can return to industry-leading EBITDA, I would expect that we probably stay focused in those areas where we can offer a true differentiation. And then let me hand to Becky, the question about following Flanders 2 enabling us to follow people through Phase II and beyond.

Yes. So it's a really good question because it is early and earlier is how customers are trying to make that decision. As I kind of tried to talk a little bit about this whole concept of tech transferring and changing the team of who you have manufacturing really does matter. And there's been so many instances in other molecules in biology, whether it's a MAV or a viral vector, for example, where customers have changed out their service partner, their CDMO and they lost a year or more in their clinical program because of that change. And so that is our ambition. That's why we made the investment into Flanders 2 to be able to partner with customers that site is slated to go late days, and that's our ambition. We have many people touring the facility, really putting it through its paces. We've made some key hires of talent that have taken molecules commercial and know the pathway, both in manufacturing, on the regulatory side. So we think we're well positioned for that. We haven't overbuilt our capacity because unlike other biology, these processes scale. You can do the same [Indiscernible] or you can put a different process train in there, and it will fit in the same 1,000 square feet, and you can make hundreds of grams. So that's, I think, a unique part of making mRNA as well. It follows more that small molecule manufacturing than it does a viral vector. That said, that site does have what we call some gray space. So there is some ability for us to think about if we want to add anything into that space. And so like Trey said, I think it's -- today, we're not going out there and saying our ambition is on bringing LNP because we don't have technology to offer customers that's differentiated, but there could be opportunity to have different types of partnerships and leverage that space. So I think that's still open and things that we definitely have discussions around.

Okay. We can go to another online question. [indiscernible] Can we talk about that relationship and opportunity?

Yes. Well, obviously, Moderna is a major player in the space, but we don't as you know, specifically disclose customer-specific programs without permission. We think their success is great for the space, and we are happy to participate everywhere where we can. But I want to make sure everybody realizes obviously, CleanCap is the primary technology that we have made a name for ourselves within mRNA. But as you heard from Kate, where -- and I love the analogies, I hope you all do, too. We're looking from the bumper through the electronics to the tail lights and everywhere in between to try to create differentiated technologies. I think it's on us to bring those to market as quickly and effectively as possible and to bring people into our ecosystem.

Question on the pipeline and your position and Trey when the company held an R&D Day in 2022, one of the interesting ideas that came out of it was this concept that in the pipeline for some of these drug companies are some modalities that use quite a bit more CleanCap. I think the number was 100 to 500x more, which is substantial increase. Is that still a realistic part of the growth case? And if so, when do you see that becoming a material part of something that can be -- that can show up on the P&L?

Yes, that probably referred to, we think of and one of the reasons I highlighted cell and gene therapy, for example, is that for obvious reasons, people think of mRNA synonymously with mega scale global prophylactic vaccines. That is obviously going to be a bulk production, but an optimized dose that's very, very different from, say, the individual oncology treatment or the amount needed to affect a cell therapy or something like that. So there's a broad -- there's not basically a single answer for what the consumption is. But we hope -- I think coming back to the question about pricing, we hope to get I would say, generally further away from the number of kilos sold to basically more enabling technology-based pricing so that we're less focused on the absolute quantity. It was absolutely RUO to GMP gain, so to speak, for COVID response. But it will be, I would say, much more broad and diversified across the different uses of mRNA going forward. And I think that's what was being referred to before.

John Sourbeer of UBS. When you look at your revenue target and then the market growth rates, it looks like you're assuming that some outgrow the market, take some share. I think you have around 1/3 share today in the capping, where do you think the opportunity is where that could go? And beyond capping, where do you see the other opportunities and where you're gaining share from your peers?

Sure. So I -- why don't I pass things around here. But I will say that, again, the first generation of capping is co-transcriptional capping which you saw -- I think, Becky, you showed a really nice means of just showing how the workflow changes. It's faster, it's more efficient and it's higher yield. The second generation capping that Kate was talking about, Drew, with M6 is the generation where you get all the benefits of co-transcriptional capping with the added benefit of functionally better performance. So there's a whole, I would say, next generation to unlock in the functional performance of capping. But then the areas Kate described, the chemistries that ride along -- why don't I let Drew take some of the things that you're looking for as growth vectors in the products.

Sure. Well, I think you described the starting point well. And certainly, our ambition is to raise that, and we don't see any reason that CleanCap shouldn't be in every program, and that's our internal selling effort is a CleanCap in every program. There are, of course, a variety of CleanCaps, right? So we haven't talked much about CleanCap AU, which is our CleanCap for self-amplifying mRNA. But as the field continues to evolve, we intend to continue bringing a diversity of technologies to help every program capture as fullest potential. And of course, our ambition is to reach the full market. We're building out a commercial infrastructure that Becky is leading to help us do that and connect with more of the customers that we haven't reached yet. So the ambition is to expand that and Trey touched on the M6 dynamic, which we think offers a new kind of differentiation from other capping approaches that should help us increase that market share. And Becky, I don't know if you want to talk about the commercial footprint as well.

Yes. I mean I think we're -- it's really important. What we see today is that when we seed our CleanCap at least with the customers that we see, they're taking that into the clinic. So they're not swapping it out. And so I think it becomes incredibly important to open up that aperture in that discovery market. And there's a number of things that we have that we're doing, right? One is to internally scale down and open up that market. It's a number of partnership opportunities as well to really pull that thread. And so I think also things that we think about and things that we haven't really explored because it's pretty new, and most of the funnel today is in that discovery to Phase I. I think based on my experience and other modalities, when people get to Phase II, and I showed that example of people who have really nonoptimal processes, they're going to start to make decisions at Phase II about how they get commercial success. We've credentialized ourselves there with these vaccines. And we'll see some additional placement in that because that's where we're well known. But people want a path to regulatory that's smooth. And so how do you -- yes, Moderna also has an enzymatic process, right? So that's also credentialized. And I think the more we do with CleanCap and we get further and further in that pipeline, you credentialize, and then that becomes so important that upfront, and we pull that through. And that's really the heart of the ambition there.

Yes. So you get -- you talk phased progression, which we showed examples of with customers. Phased progression, new products, higher uptake is just multiple vectors that we hope will stack on each other.

Conor McNamara, RBC Capital Markets. There's an investor perception that you guys are exposed to primarily mRNA vaccines, and that's it. If you look at your $700 million revenue target. Is there any way to break out how much of that would be exposed to mRNA vaccine versus other programs in cell therapy and gene therapy?

Well, I'll touch quickly in the first part of the question on our long-term projections and targets that we put in there. Certainly, in the outer years, we have less than 5% of that revenue is coming from CleanCap for current respiratory vaccine indications. So it's de minimis. We're not focused on it. It's not a growth driver for us. It's really about the base business, and all the other things we talked about today. So there will always be some level of demand based on what we support, certainly happy to do so, and that likely will continue to evolve with some other potential combination vaccines and others, but it is not something that we're anticipating substantial growth in per se. That will be less than 5% contribution with the existing indications. On the first part of the question -- just the other area.

I think that's really insightful because we -- as I said in my talk, we are making mRNA that can be in and of itself a direct therapy, and it can also be a tool to create cell therapies. I think all of you know and many of you have asked, we once a year, we engage in a very deep and very expensive study to go through every clinical program to see what our participation is. We'll be doing that again in Q4 as we do annually. And I think that's insightful that perhaps we should try to break that out and categorize. Of course, the headlines have been dominated by the pandemic level vaccines. And again, I view that as just proof of the modality, clinical proof of CleanCap. I believe, Trey you reported that there are 3 approved vaccines, and we're in 2 of them. So we feel like that's a validation, of course, of the approach. But yes, the future is in individual therapy. It's in protein replacement. It's augmented CRISPR and one of the reasons that it will be difficult going forward to say this is COVID CleanCap is that even future vaccines for COVID will be prophylactic vaccines will likely be incorporating influenza, RSV and other things. So we'll talk about, as Kevin said, respiratory vaccines, but it will just be tough to deconvolute that going forward.

Madeline for Matt Larew from William Blair. Just thinking about the mRNA vaccine pipeline, is there anything in particular that you're excited about -- anything on the therapeutic side? And I think you've talked about how more than 70% of CleanCap programs are preclinical. But for those that aren't are any approaching late-stage clinical and about how long post-COVID does it typically take for an mRNA program to move through the clinic compared to pre-COVID.

Okay. Yes, that's a lot. I will -- maybe, Kate, I'll hand to you about pipeline. I'll start with what brought me here and what got me excited about mRNA before the pandemic was oncology. I have a long career in making a lot of custom nucleic acids and the idea of personalizing oncology therapy using mRNA was something that clicked for me, and I was excited for the idea and now after the clinical proof of mRNA, I'm excited for the application and for the clinical trials going forward there. So my answer would be, particularly in oncology. And a completely new form of medicine, of course, where we can individualize therapy in that way. Kate, maybe you have some other favorites in the pipeline?

Yes. No, similar to Trey, I think the therapeutic application of mRNA is almost limitless in regards to what we could achieve clinically with that. In regards to the speed of moving product to the clinic, obviously, as you can imagine, that vary greatly on what the indication is, what the application of the mRNA is. But -- and I'm sure everyone bored with these statistics, but pre-COVID it was 10-plus years to get a product through to approval. That certainly less than that now, and you can see some significant advances with the application of mRNA and flu and melanoma treatment, and those are certainly going faster. And I think that with a lot of what caused those longer lead times was familiarity with the regulatory agencies, and that's obviously now being is clearly very defined for FDA, EMA and all the regulatory authorities moving forward. So I think we'll see faster movement than we had pre-COVID.

[Jennifer Oppold] from Alpine Peaks. And a couple of questions. Maybe Kevin is the right person here. First, just wondering about the puts and takes as you think about the trade-off between moving a little bit of money on a net income basis the last couple of quarters. And when you potentially think about cutting costs just to get that back in the green? Or how do you think about that trade off and then secondly, just the visibility of margins about a year ago, this year, it looks like it would be in that 40% to 50% adjusted EBITDA range, and things drastically change. So but I guess what -- if you could just share like what gives you confidence, what are your building blocks mentally and thinking about that path towards 2028.

Yes, certainly, yes. It obviously has been a tricky business to some degree, going from $200 million private company to a $900 million public company back down to where we are today, and all the infrastructure we've put in place. Look, I think that -- for us, we do -- our cost structure, as we talked about pretty openly with you all previously, is roughly half labor, about 25% facilities, 10% kind of variable COGS and everything else after that. And that's been really consistent for us. I think that gives us certainly nice leverage as we grow. It certainly can be a little painful as revenues go down just because of that fixed cost structure. But it's kind of what we need to be in this space. And I think we believe to be successful. I think Becky touched a lot on it. If we only wanted to be a product or a technology company, you wouldn't need the services, the Flanders or some of these additional capabilities. But I think as Drew nicely outlined, you want that full -- that cycle because it really feeds upon itself and creates that flywheel effect. So we believe that what we're putting in place is the right thing to do. It's tough to see that come on to the P&L. At the same time, the revenues are coming off from the pandemic and the market is slowing down. That's obviously causing acuteness and pressure of margins. So we do continually take actions on costs. For us, it's -- first and foremost, it was scaling down multiple ships, scaling down 7-day work weeks and all those sort of things. And then as we move forward, it's really been about a leveling of headcount growth, and we look at all costs, and we try to marry that as best as we can with revenue. Certainly, we're not full speed trying to get necessarily some of these additional capacities up as fast as possible. We're trying to get them as best as we can. So that's another way of mirroring cost with revenue because there's not a lot of people today that want to go into Phase II, Phase III builds, right? But they're coming, and they need to know that you're going to be there and have the expertise. So you have to balance all of that out, and it's really been a balancing act for us. I'd say the one thing that we take comfort in because you just look back historically that we know we can execute to these margins because we know what it takes we have sticky customers. We have good price points. We have good gross margins. We don't rely on anyone else's technology. And our cost structure is very well defined. So with revenue growth will come that expansion, and we're confident in that. It will be up to us, again, in the short term because the pressures we're seeing to continue to control costs, be prudent, step down these labor costs as we can without impacting all these nice growth factors we talked about. So we're trying to balance that. It is a balancing act. And I think we're -- even with the lower revenues that we're seeing this year, we still have one of the highest revenue per employee metrics in life sciences, us still doing $0.5 million ahead or something, which is near the very top of all life science tools and diagnostic companies. So we're cognizant of it, but we're also realizing we're building for the long term. So it's a balance. And we're doing little things that we can to make sure that we're attentive to that because it is an important part to, as you said, as we get down to the sort of GAAP-based breakeven quarters, we need to obviously be very calculated in making sure that we're not getting too far ahead of the market if the market continues to be sluggish.

All right. Team, we have another one from the online audience. moving outside of LNPs, what is the most likely technology between peptides, polymers and exomes and where can MRVI play and innovate there.

I obviously will not take [Indiscernible]. Yes, and I'm going to punch the Kate, who keeps up with all of that. But I'll reiterate my point that we don't have much to add for a strategic differentiation in that space. We're, of course, very excited to see where it goes because again, much of the pandemic response was based on what was close enough to execute first-generation LNPs, existing mRNA realization workflows and so on. So there's just a ton of opportunity and upside for delivery and we are happy to give the best possible drug substance to everyone developing in that space, and definitely open-minded to partnerships with people who have differentiated solutions. Kate, here's another what are you most excited about?

Yes. So it's a great question. We could probably speak for hours on that. Suffice to say, LNPs, I mean, they literally changed the world right through their application in COVID. But in all fairness, there are some challenges associated with them. There's some immunogenicity associations with them, which is perhaps some of the adverse events that you get after you COVID vaccine. But that said, I think, to the question, there are a lot of alternative delivery strategies being developed at the moment, some that are looking incredibly exciting. I wouldn't want to call out one in particular at the moment because I think there's a lot of opportunities there. And I think LNPs will be perfect for some applications and other delivery modalities will be perfect for others. So I think that's just what the future looks like.

Right. Let me apologize to you. I have one job to do and it's a push this button once, and I've done it twice and confused and scared people. I'm not trying to get out of our last 12 minutes of Q&A. I'm just there. That's my job. So now I practice. Do you have any others?

On sickness we need probably in the audience some clarification. We hear about online bioprocess QC see from other companies. What are these competitors referring to? Is it really going to be an online process someday or no?

Well, we're still [Indiscernible] I would say, no. Because you do need to bring the sample into the lab and run your assay. We do have automation partners that we work with so that we're able to supply some automation to that process, but you still need to bring it into the lab. So there's probably other applications that they're talking about aside from host cell protein detection. But we do have an opportunity with MockV to potentially go in line with some of our viral clearance prediction capabilities. And that's what David Cetlin and his team are focused with as well.

Thank you. Wanted to ask maybe on the $700 million revenue target. If you could give us a sense to what degree that's going to come from the service side versus the product side? I think it was really helpful to understand the synergy between the 2. But maybe compositionally and how that might flow through to the margin target, which is different than the past, but still really, really strong. And then kind of sneak in a second, if you will for Becky. I was very curious about the illustration you gave about the customer who analyzed the switching from Phase I to Phase II, taking on the service side, and you mentioned the comparability study. Like those are often what we hear is they're too cost prohibitive to even contemplate undertaking. So maybe could you speak about how you're able to convince someone to undertake that cost and how you're able to prove that it was more lucrative to your customer to make the change?

Why don't we let you take that, and then Kevin can take the model.

I think when you look at the analytics and doing that comparability there's different strategies you can take. First stop, you can do comparability with your engineering material. So when you run an engineering batch, it's actually lower cost than doing a full GMP batch, but you're running your eng batch in your GMP suite. So it's comparable process. You just don't do all of the documentation around it. And so when you think about, hey, I might have engineering materials, you can't sell that, you can't dose that, you might have that material already on hand because you had to train the suite, then you can take that material, and give it to your analytics team and then when you run your new batch process, again, you're doing it in engineering mode and then you have the ability to run those [Indiscernible]. That package of kind of if you are saying, hey, that's your statement of work, and that's what it would cost you, that's really less money than if you would ruin a batch on the floor. And then in many cases, look, it's not that -- it's tough, right? You've got a number of clients or a number of patients rather, you've got a clinical trial. You've got to get your CRO that material, you got to get your clinical sites that material. If you lose your batch and you haven't secured your next manufacturing batch, then you go in line. And then that just delays your clinical program. And so I think a lot of customers when we talk to, a lot of customers who specifically were asking us about these strategies at our mRNA day last week, and they're looking for help many of these customers just want to understand, well, what do I need to do? Like what is the data package that shows the comparability and so I think that's how do you prove and sell to your customers, you have to have that knowledge of, well, this is what the regulators want to see when you're doing comparability. Here's how that assay package will help you. If you take this into late stage, there's a risk associated with that. And I think in the long term, many -- look, I've been part of other programs that have taken really messy processes and taken them commercial, and there's been a lot of issues with it. And so it happens, but if you then try to change that process, then it is super costly and you have to go through a whole another clinical trial. So I think it's about getting people the package, helping them to understand what they need to talk to the regulators and then showing that value going forward. And I think that it will be dependent, if customers are really confident about their program, they've seen really good initial results. They have an unmet medical need. There's something differentiated about their medicine. They're more inclined to be funded and do those things. So I think that it's a full -- it's about really consulting with the customers. And I think that's where we play really well with that expertise.

Yes. Right down the $700 million target, and I'll just kind of break down the whole pie for you a little bit here. Certainly, on the biologic safety. I mean each of our divisions worked on 5-year plans, and we built them up roll them up under the segments, obviously, and took a look at them and work through them literally. Biologic safety test sort of the market growing around 10%. We've always outperformed that. We'll do a little bit better than that. Obviously, the contributions that we see in the 5-year window from MockV add to that growth as well. So you're in that low teens area for growth for that segment. Probably products is next. Again, we have some more [indiscernible] in there. If you look at some [Indiscernible] all of those and other things, not a focus of ours, but we do provide that for some of our customers. We have Glenn Research supporting sequencing diagnostics and other components. That's probably the next level of growth. I would say the services business, the one that can be the most dynamic would have the biggest CAGR within this overall pie for us just because of a couple of factors. One is the advancement in some of those inflection points you talk about as you go from one phase to another. And then the step up, as we talked about from RUO to GMP and the price premiums and the value add of doing that it gets to be a little bit circular as you're -- again, you're pulling products into the service and customizing as a custom build. So you're kind of -- you're mixing some of those lines. And at the end of the day, we don't care too much. But I think the big inflections and potential for success at the high end of the growth rates as well as to over perform is going to be in and around our ability to go with customers through that journey, later stage, do those services, pull in our proprietary products, bundle that up as high-value fixed price offerings that take into account our current cost structure and allow us to control margins and that's really how we're focused on that business prospectively. I'd say the next wildcard in there for us is really going to be in and around all these different CleanCap analogs, particularly as they differentiate therapeutically because of their outperformance versus existing methods.

Just wanted to ask a follow-up question to the one on Moderna, not as specific. I understand why you don't want to talk about individual customers. But when you look at the market and the opportunity, how do you see the split between co transcriptional versus enzymatic and ARCA because obviously, this goes to the point of your market expansion, your served addressable market expansion projections. What are you actually putting in there? And what does that split in the market look like?

Yes. So it's -- we've quoted 2 numbers so far, the last deep dive we did in the therapeutic programs where we were roughly 1/3. And then on the other end of the spectrum, the 2 out of the 3 approved COVID vaccines where we're 2/3 -- the reality is somewhere in between those 2 numbers, I think going forward, where I am hopeful is that as we differentiate performance, the thing about co transcriptional camping is not only is it a method of more efficient production faster and ultimately lower cost. We showed that actually in one of our quarterly report examples. But the opportunity to modify, as Kate showed very explicitly and get that additional performance is how we think we'll get there. So it's not just going to be counting the co-transcriptional capping message as the best production methodology, but also the differentiated performance to help us gain share. So I view 1/3 as a starting point. And hopefully, that will be validated on our deep dive.

Great. I think we have time for 2 more questions. We'll take one from Matt, and then I have another one from online.

Maybe, Kevin, for you, just when you think about the pricing environment, I think there's probably not as much clarity. But if you look at the nucleic acid production segment ex COVID CleanCap, and we look at what pricing you're able to achieve maybe during COVID due to the supply chain constraints and what it looks like now. Is there sort of -- should we be assuming a bit of a headwind in terms of lower level of pricing at this stage relative to what we saw previously during COVID? Or has it been actually fairly consistent, maybe just additional color on how that could feed into margins over time?

Yes. I mean we have not seen any real deterioration of kind of standard ASPs if you do a traditional [indiscernible] analysis. I think our pricing has always remain pretty steady. I think maybe we're a little unique given some of the differentiation on our products. But we've always seen a studied a slight increase in our price points. I think fundamentally, we still get back to -- what's the quality? How soon can I get it, sort of conversations with some of the bigger jobs. And I think catalog pricing-wise, we've been pretty consistent, and we've been very consistent as far as volume goes. So again, higher volume, lower price and those sort of things. But we've been very consistent up and down that line. So I have not seen any headwind on kind of unit pricing kind of pre-COVID to COVID to where we are now. It hasn't been a trend that's impacted us materially.

And you might be headed this way, that long-term model doesn't rely on significant price increase, if that's what you're thinking.

All right. I'm going to actually combine 2 from our online audience. Of the over 80 customers that have ordered M6 what portion of those are current CleanCap users versus those potentially switching from enzymatic or other technologies? How do you think your position to drive competitive conversions with M6 and then a follow-up trade in the seat now -- have there been any surprises? And what are you most excited about?

Drew, do you want to take the M6 uptick?

Sure. I don't have a number to answer that question with. Certainly, a lot of the people who are active in research are CleanCap customers. They may also be enzymatic customers or some of them by ARCA from this as well. And that group has been well represented in customers who are trying their hand with M6. I think there are others who maybe haven't used CleanCap in the past that are also trying their hand. And we certainly expect that as the performance characteristics of M6 have opportunity to demonstrate themselves in our customers' work that it is a lever that will allow us to increase that market share of capping that uses CleanCap analogs relative to the other approaches. Was there another part I missed?

No. I think this right, you good?

[indiscernible]

I am thrilled to be in the CEO role. As you probably all know, it was not a straight path to get there. And hence, I've only been in the role 9 weeks now. I would say I have been pleasantly surprised, honestly, with the team, the technologies, the things that we're running and in place when I got in, I'm really excited to help see those to fruition. Exogenously, I think we've all in the industry have been surprised by what the pandemic did going up and what the pandemic is doing going down industry-wide, I think very few people expected it to be such an extreme up and an extreme down, but we have found ourselves, I think, at a level here where we're, as Kevin said, it's on us to tune the business and to diversify our business significantly going forward. And like I said, coming back to my positive surprise, I'm really thrilled with a lot of the programs that were already in place and new product introductions and services that are coming in the near term. And as I spent most of my talk at the beginning, I'm really thrilled with the toolkit that I was left by Karl, the cash position we have, the facility position we can leverage this incredible and experienced team -- it's all a very good setup for long-term diversified organic growth. Yes, I guess I should wrap. We're minus 3 minutes. So there's my one job, closing remarks. So I think I just sort of made them, I guess. But the -- I want to thank everyone very much for joining us for your attention today, to the team for doing a great job. I do really believe it's an amazing time to be in life sciences. We are in the right markets, as I said, between biologics. Well, cell and gene therapy counter to your point, Cygnus is completely differentiated, a 100% of the approved cell and gene therapies use Cygnus to QC for host cell protein and some for DNA. We have differentiated TriLink already in mRNA and want to continue accelerating that way. mRNA as a therapeutic is super exciting. mRNA is also a tool for cell and gene therapy. So I think it's going to be an incredible journey here over the next 5 to 10 years for a new generation of medicines to accelerate human health -- to move the needle, frankly, on human health. And I'm thrilled to be a part of it, and I hope you're all thrilled for the future of Maravai. I appreciate your attention, and I won't stand between you and lunch any longer, and we'll be out there having lunch with you if you want to do any follow-ups. So thank you very much for joining us today.