Mettler-Toledo International Inc. (MTD) Earnings Call Transcript & Summary

Hello, and welcome to real-time measurements for Microbial Health under pharmaceutical water system presented by American Pharmaceutical Review and sponsored by Mettler-Toledo. My name is Mike Auerbach. I'm the Editor and Chief of American Pharmaceutical review, and I'll be the moderator during today's event. In this webinar, you'll learn the benefits of combining online detection of conductivity, TOC and bioburden or conventional microbial detection methods, how to use this information to mitigate the risks of future microbial events, how online measurements can be sent conveniently to control systems providing better data integrity and how online microbial data can increase our understanding of the water system microbiome. In addition, this will hold a live question-and-answer session at the end of the presentation. [Operator Instructions] Please take note the right side of the screen also features an overview of this webinar and more information regarding our speakers. [Operator Instructions] Finally, we encourage you to use the social media wages beneath the webinar to share with your friends and colleagues. And now allow me to introduce today's speakers. Peggy Banarhall has been a product manager with Mettler-Toledo since 2008, representing real-time measurement solutions in regulated pharmaceutical waters, such as TOC, conductivity, Ozone, PH and microbial detection. Peggy holds a Bachelor of Science degree in medical technology and a Masters of Business Administration degree with experience in clinical diagnostics, microbiology and immunology, biotechnology, drug discovery and pharmaceutical manufacturing applications. Tracy Radcliffe is a national business development and technical resource, driving implementation of real-time bioburden monitoring for USP grade water systems in pharmaceutical, microelectronics and personal care market segments at Mettler-Toledo. Tracy has over 22 years of experience in pharmaceutical, petroleum, food and environmental microbiology markets, including 12 years specializing in consultative selling and market development for rapid microbial and environmental contaminant detection technologies. Peggy and Tracy. Welcome to the webinar.

Mike, thank you for that great introduction. I'm Peggy Banarhall, and I'm thrilled to be here with my colleague, Tracy Radcliffe, and we're going to talk to you about one of our really favorite subjects, which is real time measurements for the microbial health of your pharmaceutical water system. First of all, I'd like to tell you a little bit about our company. It was -- we were started in 1964 by Dr. Richard Thornton, who was an MIT professor, and he really focused the company on Pure Water measurements, specifically targeted at that time into the semiconductor industry, which was really looking for a critical temperature compensation algorithm for ultrapure water measurement using conductivity and resistivity. And since that time, Mettler-Toledo Thornton has really focused on ultra-pure water measurement. We became a part of Mettler-Toledo in 2001, and we're really considered a leader in online measurements in pure water, and we're widely recognized in the production of high-quality resistivity and conductivity sensors and TOC sensors. We have a really long history of leadership in industry institutions, such as the USP, the European pharmacope, the semi field and many others. Pharmaceutical water is regulated by several parameters to ensure it's fit for use in our pharmaceutical products. In fact, pharmaceutical manufacturers really spend a great deal of time and money to ensure the integrity, quality and safety of the water that they use in manufacturing. The measurements mandated by our regulatory bodies globally include conductivity, TOC, bioburden and endotoxin. In some water systems that use ozone for sanitization, Ozone is included to ensure that no added substance requirement is met. Even if water is released in a laboratory measurement, online measuring devices have become commonplace in the industry, providing huge advantages to water system owners who have come to rely on them for peace of mind that their water system remains under control. These online measurements can easily be sent to control systems, providing data integrity and the opportunity to monitor all regulated parameters at the same time. Bioburden and endotoxin, of course, also performed, but only with off-line tests sporadically and retrospectively performed. This greatly limits the options to effectively reduce the risk of releasing water contaminated with microorganisms. So as we continue to wait for our plate counts and endotoxin tests to come back the lab from 3 days to 5 days to 7 days, what happens to our highly regulated water? Well, it's simply gone and we're using it to make our products. It's touching our products, it's rinsing our products. We already know that online monitoring significantly reduces the risk of TOC and conductivity excursions in our regulatory waters. We rely on those measurements for risk control. But honestly, the historical frequency of a product recall due to connectivity or TOC is not something we ever really hear about. On the other hand, microbial contamination in pharma water systems continues to plague us, representing a significant risk to our final products, especially the non-sterile products. How often have you seen an FDA alert to the market, citing pharmaceutical water system as the primary source of microbial contamination? Probably more than we like to think because the fact of the matter is that microbial contamination in a water system is often difficult to detect and harder to treat. So why do we monitor pharma water for bioburden? Water is widely used in pharmaceutical manufacturing, either as a raw material or as an ingredient or certainly a final product. So we want to be able to reduce microbial contamination risk from poorly designed or maintained water systems. And sadly, this is the case. We have many water systems that are old that need to be redesigned. And so the reality is that microbial contamination does and often occurs because of this fact. So we also want to assure the quality of the final product that's available at our final points of use. We want to assure the effectiveness of our sanitization cycles. Are they too long? Are they too short? Can we optimize them? We want to control the formation and proliferation of biofilm within the water system. We want to increase our confidence because we know the current microbial test method for proving that our water systems are under control microbially are limited. And so online microbial detection increases our confidence when we use it as a backup to plate counts. Online microbial detection provides us with speed of response. No longer do we only have to rely on a plate count tests for 5 to 7 or longer days for us to get test results. So overall, we also want to make sure that we can reduce our investigations and lower our costs by being able to make a better measurement. Online detection helps us make smarter decisions. It's really hard to optimize your water or optimize our sanitization cycles using a plate count test that is once a day or twice a day. It's almost impossible to do so. So the online methodologies provide us with a lot of choices. We also finally need our microbial testing or a bioburden testing to fulfill our industry requirements. Today, Mettler-Toledo offers online measurements for all three of the primary compendia measurements that are required for pure water measurement and those are conductivity, TOC of course, bioburden, ozone for the no-added substance rule, and GOC, connectivity and bioburden today can be all measured online. It's a huge advantage. There are five valuable questions that we're going to cover in this presentation. We're going to talk about the technology, who does it help? Where do we install it on old system? Why are people implementing rapid microbial methods? How are they using the data? I'm going to have some discussion questions where we talk with you and answer your questions. We're also going to share some case studies with you. Today, we're going to talk about the 7000RMS microbial detection analyzer. This is a process trending tool for measuring microbial cells. It's a nongrowth based process trending tool, and it measures directly from Pure Water. Think about that for a minute. Today, we can measure the bacterial health of our water system. Continuously directly from a flowing water sample. So just like TOC and conductivity for chemical water control, now we can actually look into our water system and see the microbial health of our water system. How do we do that? We use two tried and true methodologies that were developed more than 40 years ago. And the first one is particle detection. We know that we can size particles using knee scattering, which is a forward scattering of light to provide information on the size of the particle microbial cells are particulate in nature, but they have a particular size range. So we look for a particular size signature that is consistent with the microbial zone. The next thing we do is we look for intrinsic fluorescence of those microbial cells. We know that microbial cells, all on their own, will fluoresce critical intracellular components when they're illuminated by fluorescent light of a particular wavelength. In our instrument, we use 405 nanometers. We use a laser diode and we illuminate a flowing water stream. So we look at that flowing water stream continuously. We're looking for a particulate signature, consistent with the microorganism. If we see that and at the same time, we see evidence of fluorescence, then we call that an autofluorescent unit, which is the measurement unit that we use in our instrument. The autofluorescent unit, just for information is something that the industry has developed. It's not a Mettler Toledo term. Online microbial detection when used in parallel with plate counts improves the process transparency and helps us ensure water quality. As I mentioned before, just relying on a plate count that is done sporadically and many companies do it in many different times. Some companies do it once a week. I've heard of some companies doing it once a month. Some do it a few times a day at a certain time of day. And so when we rely on plate counting, we're only looking at a snapshot of the water system. And the plate count is only looking at the ability of a viable microbial cell to go on and form a colony. And as we know, as we've come to discover and Tracy is going to talk about this in upcoming slides is that we know that there are micro organisms that we're missing that are plaguing our water systems contaminating them, causing us to do investigations and expensive remediations because we cannot detect them using just one method. So when we combine this with an automated methodology, such as the 7000RMS. Now we improve our ability to detect those microbial cells immediately, and we can marry those results with that of our plate counts to improve our microbial risk in our water system. Microbial populations and our water systems, they really do exist, hot [WFI], ambient [wfi], purified water, they all have a microbial signature. But just using our plate count, sometimes we can't detect that signature. We also know that microbial populations can respond to changes in our water system dynamics such as it can change when we change our source water or it can change when the quality of our source water changes and we'll talk about that in an upcoming slide as well. Water system dynamics can disrupt the normal microbial population. We know that we see real-time signatures when there are failures of water system components. Filling and emptying of storage tanks, opening and closing of valves, sanitization cycles, maintenance activities. So our ability today to be able to look at real-time microbial trends along with TOC, conductivity and someday, endotoxin that currently is not performed online. And in addition to other plant parameters, we can now improve the process transparency of our water system and make better water. Now Tracy is going to talk with us a little bit about the biofilm and actually water system microbial risks. Tracy.

Thanks, Peggy. I would love to talk about biofilms and Microbes, which I am really passionate about. And biofilms are really important topic of discussion in the pharmaceutical industry. We faced a lot of challenges when we have microbial activity in our water system. And there's a lot of things that we have to be concerned with. And so, I'm going to talk little bit about some things that customers have experienced with respect to microbial contamination and talk a little bit about important things to consider with respect to risk mitigation and risk management and about some of the pain points that our customers face today with respect to the water system. So I'd like to talk to you about some examples of biofilms in pure water systems some customer scenarios as well as some important aspects to consider for risk mitigation and risk management and microbial investigations. And in particular, we -- in the pharma industry, we use a lot of ambient water for injection and hot water for injection. And there is actually somewhat of a misconception that biofilm cannot exist in the hot [wfi] system. And that's just not accurate. We do have evidence that these organisms exist. They are highly adaptable not only do the bacteria adapt to low nutrient conditions, varying temperatures, varying pressure. They might be in a stress state because of the methods by which we sanitize our water system. When we're using chemicals or things like ozone ultraviolet light -- all of those are going to impact the bacteria such that they're still present in the water and they still may be an indication that the biofilm is present, but you might never recover them in a plate count. We call those organisms viable but nonculturable or VNBC. They're a challenge for us. And some of the top organisms we hear about being in water systems are organisms like pseudomonas, Ralstonia, Burkholderia. Those are, I think, the top three worst contenders to have. There's a number of other different genus names, but technically, they're really -- they're all related to -- and most of them are into pseudomonas and Ralstonia and maybe they used to be called Ralstonia, but now they're called something different. So we have a challenge with our traditional culture methods in that these bugs are hard to recover. But as you can see in the picture on the slide, we have evidence of a biofilm on a pressure sensor where if we didn't sample this pressure sensor specifically, we might never recover this bacterial contamination in the QC lab. So that's a challenge, but it's also interesting, and it teaches us a lot in our industry. And I'm sure a lot of you listening to this are microbiologists. We know that we have limitations when it comes to relying on plate count alone. And so what happened with this pressure sensor is this was something that was removed from pharma companies hot wfi system for inspection of a gasket. And here, this gasket was covered with biofilm that was not only surviving, it was growing. And so the standard grab sample method that was being used by the company measured only 0 or 1 CFU with most incubated plates because they weren't sampling the right area. And this is where rapid microbial methods come into play as an additional tool to add to your toolbox. We really do need real-time microbial detection in our industry because we don't want to find out too late that we had an issue and that water was used in a product that we now have to either destroy internally or recall from the market. And biofilms not only do they persist in the water system, but they will, in certain conditions, shear off, and that's when they become detectable by our instrument. So now I want to talk about some big bad bugs of pure water. I bet a lot of you are really familiar with Ralstonia and Burkholderia. And I'll say that in speaking with customers over the last few years, I think Ralstonia takes the cake as the #1 culprit of contamination. And in fact, what's discussed on this slide is an analysis of FDA product recalls for 134 nonsterile products from 1998 to 2006, demonstrated that 48% of those recalls were due to contamination by either Burkholderia or Ralstonia and that's really significant. And Ralstonia is tricky because it likes to squeeze through filters, it can change its shape pleomorphic I think it's one of the reasons why it's so prevalent in our water systems. And it doesn't necessarily mean that we did anything wrong with the water system. It's just a fact that these organisms exist. They like to live in those environments. And so we need better detection tools to determine the presence of contamination so that we can make faster decisions. As Peggy said, we need faster time to result of microbial activity so that we can start investigation sooner so that they take less time and because they take less time, they are less costly, and they also take less of the microbiologists' time away because we know that you guys that are microbiologists you have other important testing that you need to do besides investigations of contamination. In some cases with Ralstonia and talking to some customers, there have been people that have spent more trying to find the root cause of the contamination. And in that process, not only are they, as I mentioned, spending all the time on hours of investigation, but the cost to remediate the water can also be very, very expensive, talking about tens of thousands of dollars to maybe $0.5 million in some cases. The longer the investigation takes, the more it's going to cost. The one thing I'm really passionate about is risk management. I do have a pharma background. I've lived through consent decree and mold contamination and microplasma contamination, been involved in corrective and preventative actions. And so one thing I'm really passionate about with helping customers is helping people understand where their risk is in their process. And so in talking to customers, it's become important to think about how does the microbial contamination, how does a severely persistent biofilm in your water system impacts the business? And especially for the manufacturing suite, think about how is your system configured to support your manufacturing? How many manufacturing suites do you have? How many points of use do you have? When we worked with customers that have small water systems all the way up to huge water systems that maybe they have 250 to 300 points of use for their entire site. That's a pretty significant amount of samples to take and to analyze on a regular basis. And even with that, you are getting the plate counts retroactively. The water has already been used. So in using rapid microbial methods as part of your risk management, one thing that's helping you to do is understand what is your actual risk related to water. Do you have a backup water supply if your water system goes down. This is not necessarily the case for everybody in production. Some people only have one water system. I mean that's pretty important, if your only water system goes down. But secondarily, if you have more than one water system and you have to shut the first water system down, what is the microbial activity in your backup water systems? We've worked with customers that -- they switched from a different tank 1 to tank 2 and tank 2 maybe hadn't been used in a long time and well and behold, there was some biofilm that had built up and wasn't characterized because they hadn't been sampled in a while. And Peggy has some examples of that coming up. So what is your risk in your water? Do you have a full picture? And how can you marry online microbial detection with your plate counts give you the full visibility into what's going on. If you have to shut your water system down, what is one day of manufacturing cost you? Or if you shut down for sanitization, especially if it's an unplanned sanitization, what's that impact on your business? These are things that are truly reasons why the pharma industry is looking at rapid microbial methods and adopting them much more frequently than maybe we did in the past. To expound on that last discussion point, some of the value of real-time microbial monitoring as told to me by customers because they do spend a lot of time out in the field, there's a lot of different ongoing themes right now that relate to risk management and one theme that I've heard in the last year, and it has been sort of a recurring phrase. I don't know that it was -- no one invented it per se, but the theme of automating quality into our process. So with all the changes, with all the expansion, with changes in regulations, pharma manufacturers are looking to automate process analytics much more than maybe they did in the past. Even TOC was not always online. I can remember 20 years ago, working in manufacturing and a chemist would come to our manufacturing suite and take samples and then we would have to wait hours for them to get the results back to us before we could continue with our process. Now we have said to me, we want to add as much automation to our water system for a number of reasons. So one, reducing human error. And again, this isn't a commentary on bad QC sampling. It's just the nature of bacteria are everywhere. -- and they can get into the water system, they can get into bioburden sample containers and on containers, and you take that back to the lab and here you had a false positive. So reducing human error is a huge theme. QC has a lot of things that they need to do aside from routine monitoring. So we can potentially streamline our water sampling programs by having the data from online monitoring. Another theme that I've heard recently is that some organizations are looking at transferring responsibility for the actual sampling from the QC group to the utilities group. Again, this is where auction becomes even more important and more discussed as we talk to customers. And USP has not said that we can use rapid microbial methods to replace accounts. However, as Peggy mentioned, they're used in parallel and they help provide a complement to each other in identifying real-time risk so that if you have a contamination instead of waiting 7 days to shut down, you could shut down immediately and then you're not having to destroy a product that was made with contaminated water. So that's a little bit about the risk piece. As far as process excellence and process optimization goes, the other piece to this customer value is this can be a tool used to help validate a new water system, people that are putting in brand-new water systems, there's a lot of projects going on right now, large expansions all over the U.S. And these companies, they want to get up and running into GMP manufacturing as quickly as they can. So if they can use various tools to help validate the water that helps you get to making products faster and making money for the company. Peggy touched on sanitization a little bit. This is another process optimization that real-time microbial provides value. Some people are sanitizing too little -- some people are sanitizing too much. And for those people that are sanitizing too often, they could use real-time data to help them actually gain back production hours and not create manufacturing bottlenecks where maybe you're sanitizing every night for 6 hours on third shift, and you could actually be making product during that time. And then there's the overall theme that everyone in the pharmaceutical industry, they want to make the best quality water possible and be able to have proof of that. These are all the themes that customers teach us about. So again, talking about risk management, I think it's important to put out there what the operational cost and risk are to the business. And nothing on this slide is being a scare tactic. I know people get really uncomfortable when they hear consent decree. I lived under consent decree. It taught me everything I need to know to have a GMP mindset for my entire career. I wouldn't wish it on anybody. I think it's important to note that there are all these different factors that affect your return on investment when you're looking at implementing a real-time microbial monitoring system. And the whole idea, again, is to improve your water system operations reduce costs and ensure water quality. So some of the things that we look at are the cost of your sampling program, the cost of your QC investigations. Do you have false positive events? And do you have investigations of real contamination that persist for months on end? What is the actual cost and what is the impact to your business of those things? The worst-case scenario, obviously, are things like product call consent decree, again, the whole idea of using RMM as part of FDA's PAT initiative. The process analytical technology initiative is to prevent these events and to implement quality by design into your process for anybody who's putting together a new facility, you're very familiar with quality by design. And so this is something that is really important with respect to the water system is. Are you making good water from day 1 when the water is produced? And so you don't want to have excess costs related to remediation activities or undue wear and tear on your water system components. You don't want to be holding water for an excess amount of time, you don't want to be dumping water. Energy costs are high for people that are doing hot water sanitization, that's really costly right now. Some people tell us that they only heat up half a tank of water because of how much the energy costs are. And then, of course, you don't want to have undue production downtime because you had an unplanned microbial contamination. So these are all the things that we can think of when we're looking to implement real-time microbial monitoring, which is the greater risk, spending money on real-time measurement or not having it at all. And just one last discussion point on risk management. We still have products in the marketplace that are recalled due to contaminations in pure water. In particular, here, we have an example of a nasal spray that had bacteria in it. And I'm sure if you're like me, you don't want to be shooting pseudomonas up to you nose, okay? Because "Hey, you could have a biofilm in your nose. These type of contaminations are really costly, not only from the monetary aspect themselves, but from a brand protection standpoint. In some cases, when a contamination like this happens, it doesn't just affect brands that was recalled, it affects the entire category of product. And some people might think, "Oh, well, I can't use any generic nasal spray now because all of it probably has contamination." So there's that aspect of contamination in the marketplace. It may not just affect one brand, it might affect the whole category. This is especially true for CDMOs. CDMOs are front runner for implementing online microbial detection because they have a lot of risk associated with their process. Let's just say you're a contract manufacturer and you have 16 manufacturing suites. That could be one. One customer is running out all 16 suites or it could be 16 different customers. So what's the risk to your business if you have to shut your water down? Or even more severely, what is the risk if you didn't know that you had a problem in the water, and you use that water to make 16 different products? So again, this is why we don't present FDA recalls as like a scare tactic. We present it to be a teachable moment and learning activity that these types of recalls do exist. We do need to be concerned with our water. Plate counts are an estimate. We need more tools in our quality toolbox to help us avoid things like recall. This is the type of activity that is going to persist. But now that we have better tools, we can get the answer sooner and hopefully prevent events like this.

Tracy, thank you for that. It was a really great discussion. And I think we're both very passionate about this product because we both have but different microbial backgrounds. And we understand that these organism contaminations are a reality. We hear them from customers. Customers are frustrated by them. We have FDA personnel saying, "You know what, if you have a contamination in your water system, the soonest that you can likely discover the location or the source, you'll be lucky if it takes you less than 6 months. That's really significant. So you're making product, certainly at risk. But imagine the stress to the organization, the stress to you as a microbiologist or a quality control person. So online microbial detection is not something that we should be afraid of. As a matter of fact, we should embrace it because the options are only going to increase what we have with them today. We have many, many options today. So I'm going to talk to you a little bit about a couple of case studies where our customers utilize our technology to solve a problem that they have. In the first case study, this organism, and you can see the illustration of a water system. And you can see the storage tank and -- most of the time when a customer starts out with microbial analyzer, we will recommend that they put it on the return load, because that's really the highest risk area. If the water is good at that point, then the water is good for use. Also, this is the place where we do our compendia measurements of TOC and conductivity and endotoxin. So it makes sense to put a microbial analyzer here. But in fact, there are other places just like any online system, you can choose where it adds the most value to you. But in this situation, the customer placed a 7000RMs on return loop. It was an ambient water for injection system. Important to note presence of ultraviolet component on water system prior to the customers starting with the instrument is that they did a complete passivation of the water system before they started the trial. They normally did a hot water sanitization routinely 1 hour each morning. The case study evaluation period was about 50 days. They looked at their direct cell count information and their colony forming unit information about every 2 weeks. Total cell counts measured as autofluorescent units or AFUs per 100 ml, and the same volume was used for the colony-forming units. So in this slide, we show initial data. The trial started around mid-August. And you can see in the slide that the average AFU baseline is 115,000 AFUs per 100 amount. So we have evidence of microbial presence, but look at our CFUs, zero colony-forming units. And you'll see throughout the trial, the customer had zero colonies on their plate count. They were using industry standard [ R2A ] or TSA plates. They were incubating for 7 days at 35 degrees. So in this slide, we show initial data. We show a date range of August 8 through the 14th. The AFU trend in this slide you can see is visible in green. We have a temperature sensor on the 7000RMS. So as the water passes into the instrument at a rate of 30 mls per minute, we can monitor continuously the temperature of the water and plotted in conjunction with our AFU measurement. And in this way, when we sanitize, we leave the instrument on and we can correlate or compare the AFU trend with each standardization. So you can see that sanitization in this case was effective. So it started out with the normal, as I mentioned on the first slide, 1-hour each time period. And you can see that the AFUs dropped in this case. The customer evaluated then an AFU trend during a couple of prolonged sanitizations for 8 hours and for 12 hours and collected data. And you can see that the AFUs dropped during this time period from 115-plus thousand AFUs per 100 ml to 36,500 AFUs per 100 ml. But every time sanitization concluded the AFUs bounced right back up. Then in the next stage of the trial I think it was the Labor Day holiday was coming up. And so the customer had an opportunity during the long weekend to actually quarantine their water loop for a certain period, and they started that quarantine at 12 a.m. and September 1. And remained quarantine throughout that weekend to September 4. Now the starting AFU count during this down period was almost 106,000 AFUs per 100 ml. And again, look at the CFU count, it was zero CFUs. So hot water sanitization occurred at 4:00 p.m., September 1, and it concluded at 7:00 p.m. September 3. During this quarantine period, no new water was introduced into the water loop. So the water loop was completely isolated. You can see in the first bubble, the start of quarantine, a mini spike, which the customer correlated with some flashing of the points of use, and then a long decline in AFU levels over the 50-hour sanitization. So it's a nice example of polishing effect. With the water loop completely closed off, you can see that polishing effect, and it occurs throughout the time the water system was quarantined. AFU levels in this case, you can see the final AFU level on September 3 at about 3:00 p.m. was a little over 3,500 AFUs per 100 ml. They got some significant cleansing of that microbial concentration during that period. Then it's 12:00 a.m. on September 4, source water was introduced into the ambient [wfi] loop to prepare for water system use the following day. after the source water was introduced into the loop, you can see that the AFU levels immediately started to spike and continue to increase, spiking up to about 85,000 AFUs per 100 ml. So we had a root cause discussion with the customer, but this really was normally when customers use our instrument. We spend a good deal of time at their discretion to help them understand what they're looking at, because most customers are used to plate count. So we're used to zeros and 10s and 5s and too numerous accounts. But we're not used to looking at water system trends for microbial activity. Water system owners and people who work in the control room are very familiar with online trending for connectivity in TOC, but not for microbial detection. So usually, we work hand-in-hand with customers. But the customers are determining what is the likely scenario that has occurred. We can give suggestions, we can give observations, but the data is theirs. So the customer then summarized their findings in theories. The data demonstrated effectiveness of sanitization protocols. They could see that every time they sanitize they got a nice microbial concentration reduction, and this allowed the customers to have confidence that their sanitization was intact. And initially, when the trial started, the customers surmised that maybe they had a really bad biofilm problem and that the biofilm was actually in the shedding stage on its own, and these drugs were platonic all the time. And after the trial, they figured that, although biofilm could have been a contributor due to high AFU counts, the source feedwater supplying the wfi system was the most likely true root cause. So customer talked about, [indiscernible], I wonder why we never got any CFU counts. That's really curious to have really high AFUs and zero CFUs. And so they were really concerned about that. We actually proved to them by installing a second instrument in the early period of the trial on the same water loop measuring the same water at the same time. And both of those instruments, we know coming out of the factory, are baseline of those instruments were less than 200 AFUs per 100 ml. And so 2 units matched within about 5% of each other. So the customer noted that bacteria and the water did not grow on either their TSA or R2A plates, they surmised that probably was a situation of organizers being viable, but not culturable because obviously, the RMS saw evidence of microbial activity and that the UV lamp and sold in the water loop likely impeded the microbial cells ability to form colonies. And this has been studied in the literature and the UV lamp is doing its job. So what we help them prove is that the online microbial detection enabled the customer to prove the effectiveness of their sanitizations and to then shift their focus to investigating the pretreatment system feeding the water loop. The next case study I want to share is a little bit different. In that we have discovered working with customers who have embraced the online method. Is that sometimes tracking tank levels along with AFU activity can provide insight into not only the microbiome of the tank, but also the microbiome of your water generation equipment and, of course, your water. And that the online microbial detection device really offers an early warning system to identify whether a water purification process needs to be serviced and certainly, if it remains in compliance. In the upcoming case study, sample water and plate counts were measured together to help solve a problem in their water system. So in this example, the customer had a situation where they had positive plate counts that occurred during their normal plate count test that they did routinely. One day, they would be fine. The next day, they wouldn't be. Two days later, they would have positive hits and then they wouldn't. It didn't make sense. They were not simultaneous. They were sporadic and they were trying to figure out what was going on. So they decided to install a 7000RMS in their water loop. And in this slide, the customer used the 7000RMS in conjunction with their plate counts to track tank levels, emptying and filling and marry that with their plate count tests. In this slide, we can show AFUs so in grain again, the AFU trends are in green. And you can see a period of a very sharp spike and then we have a decline. And then we have a sharp spike, and then we have a decline, and this was the normal pattern of their water system. Customer analyzed the 7000RMS, looking for any patterns that would provide clues of a periodic or abnormal disruptions. So they looked for periodic spikes then subsequent decays. Eventually, they determine that the disturbance in the AFU counts was correlated to the timing of their tank filling process. The tank emptied, the AFUs went up, the tank filled, they went down. Customer then collected traditional plate counts, at approximately 30-minute [ intermodals ], along with the 7000RMS data continuously and simultaneously. While evaluating this data along with the water system log and maintenance schedules, the customer has eventually learned that the mix that ion exchange resin was far overdue for replacement. So they wanted if that was the root cause. And you can see that in this slide, I'm showing where plate counts happen to be collected. So samples were collected. You can see when the AFU trend was low, and there was a second set that was performed when the spike was high. And then there was another set that was performed after the DI resin was maintained. Now here, you can see the results of the 3 plate count tests. So you can see in the first sample, the [ AGR ] is R2A. And in the first sample, we have very low AFU activity and the plate count path. In the second when the AFU spike was high, we had a failed test where we had to numerous account as a plate count result. And then in the third that was taken after our maintenance, we were back to a passing test. Some of the organisms present in the water system were identified, and you can see those results in the top right of the screen. So as Tracy mentioned, look at the third organism down. What a surprise, Ralstonia, pseudomonas, certainly not aeruginosa, but a cousin, [indiscernible] used to be a pseudomonas. So there are classically organisms that are water friendly. They like to hang out in water systems. And sometimes, we can't detect them on our plates. Ralstonia, as Tracy mentioned, is very pleomorphic, so it can evade our filtration system, yet if we held our plates for longer than our standard time frame or perhaps drop the temperature or with different media, we may, in fact, call to them. So what did the customer conclude? The customer concluded that using the 7000RMS, real-time microbial analyzer, the customer was able to identify a true water purification issue. If you only sample periodically as with plate count test, the timing of the samples is absolutely important. And you saw that in the examples that were shown. So if the plate counts are not taken at the time of the event, it's highly likely that you won't get a positive or any indication that there's something there, but using an online analyzer when you sample continuously, this information becomes forthcoming to you. The customer saw that using online microbial testing as a backup to plate count test increase their confidence that their water system was still in control. They didn't drop their plate counts, of course, not. But they were able to see that they could use an additional method to improve their confidence and reduce their risk of missing a contaminating event or not being able to solve a root cause investigation. So like connectivity and TOC, we are used to using these measurements. If you haven't considered it, you should consider real-time methodologies for microbial control because many customers had found that they add value to their operation. Tracy, those were like so illustrative those case studies. I really like talking about them because they just really help illustrate the value of these analyzers. And how limiting just relying on plate counts can be.

I really do think that we learn everything from our customers and the various problems that they face. Because in our industry, even though we're all using types of water, there's just little nuances in the water systems that make each scenario slightly different. And so the more data that we're getting from the real-time measurement, the more we learn about how to control bacterial populations in the water and how to come up with strategies to optimize the process control piece. And so the major benefits of implementing online microbial monitoring are that we can improve quality, reduce risk and lower costs. And these are all things that the engineers are concerned with, the utilities owners, the microbiologists, QA directors. This helps everybody because we're all in this together. None of us want to have to spend money or be shut down due to contamination that we could have had an early warning about much sooner than the plate counts. And so again, we talked about quality by design a little while ago. And this really is one of the major themes of implementing a technology like this. We can use the online monitoring in conjunction with plate counts because we have increased sensitivity, we can reduce noncritical grab samples in some cases, potentially reduce false positives, and get a warning of contamination that much sooner. What the early warning allows us to do is to more quickly evaluate the impact of the water system dynamics on microbial populations. Hopefully, improved root cause investigations that might not always be the case, but certainly, we can start the investigation sooner if we have the warning sooner. And what that provides is proactive intervention into what could have down the road become a really harmful event for the company. On the process excellence side, we can immediately verify water system integrity after maintenance activity. and we can reduce process cycle time and potentially increase production efficiency. And as I mentioned, with the implementation of a lot of brand new production facilities and brand-new water systems, confirming a good sanitization strategy is really key. And so real-time monitoring can help you get the information that you need to design a good sanitization program. What that in turn does is reduce premature replacement of water system components and lowers costs and energy associated with those maintenance activities. And again, overall implementation of quality by design and process analytical technology, it's a good thing for us to be doing and also keeps the regulators happy.

We like to thank you for your time today and the opportunity to speak with you. We hope that you enjoy the presentation. For more information, feel free to visit the mt.com website. And now we would love to take your questions, and thank you again.

Thanks, Peggy and Tracy, for your excellent presentation. [Operator Instructions] Before we get into the Q&A session, we do have some polling questions for you to take a look at and I'm going to push those out to you right now. Our first question is what is the biggest barrier that will prevent you from implementing a real-time microbial analyzer on your water system? And your choices are how to approach validation, cost of ownership and results are different. So I will give everyone a few minutes -- a few moments to make their selection. And let's see. So right now, we've got about 20% on how to approach validation, about 60% cost of ownership and 20% for results are different. Peggy and Tracy, any comments on the results of our first polling question?

This is Peggy. It's pretty reasonable unless people are concerned with whenever you automate something, we all say, yes, that sounds really good, but how much does it cost? I think -- and Tracy actually spent a great deal of time with customers, talking about addressing those issues. But I think you have to keep in mind that what we're currently doing is not cheap. We're doing plate counts depending on how many you do, when you do them? How you do them? What your cost structure is at your company? How many false positives do you have that you have to investigate? There are just a number of things to consider when you talk about cost of ownership. And then just this whole issue of undetected real positives. And if you have a contaminating event, Tracy talked about that. How much does it cost to clean it up if you have one? So all of these things come into play when we start looking at cost of ownership. So -- so these are great responses from the people who took a moment to do the poll. But there are usually, these online systems at the end of the day when you go through the ROI discussions. People who choose divide them really find that they do add value and the price points when they look at everything are pretty equitable.

Excellent. All right. Let's look at our second poll question. And our second poll question is, what point is driving your interest in online microbial detection? And your choices are keeping up with new technologies, reducing sampling or sanitization costs or risk reduction. So I'll give everyone a few moments to make their choice, and then we'll take a look to see how everyone responded. And let's take a look at our responses here and keeping up with new technologies was about 33% and then reducing sampling or sanitization costs, took up the other 2/3. So any comments on results of our second polling question?

This is Tracy. I agree with -- Yes. Sure. Yes, I agree with both things actually, reducing sampling and sanitization. This is something that, as Peggy mentioned, we look at in return on investment calculation. So sorry, I'm having some audio issues here.

That's okay. We can move on to the next poll question. No problem at all, while you get that straightened out. Let's take a look at our third and final polling question, which is currently, I use an online microbial detection device on my water system, yes or no? Fairly straightforward question there. I'll give everyone a few moments to make their choice. Let's take a look at our results, and about 89% are currently not using the microbial detection device on their water system. Peggy and Tracy, any comments on this final polling question?

That -- this is Peggy. That doesn't surprise me at all. I think the -- many customers are looking at the availability of these methods, and customers are evaluating relative to cost of ownership. Some people really haven't heard about them, and maybe we care about them, and we don't understand the value. So I think that it takes a long time to change an industry mindset. So I'm not surprised by the percentage.

Thanks, Peggy. So we've completed our polling questions. Let's now get into our Q&A session. We've got several questions in already. Our first question is, was there any correlation between AFU and plate counts above zero? I can appreciate that AFUs are very sensitive, but I would like to know how AFUs related to non-zero-plate counts. What I see is that once make-up water return to the quarantine system, the AFUs bounce right back. So a longer sanitization looks better until water is added back to the system.

This is Peggy. So that was -- so we have to keep in mind that autofluorescent units and colony forming units are very, very different measurement units. In the colony forming unit, we're measuring the ability of a viable cell to go on and form a colony. But what if it doesn't? Many things impact an organisms ability to form a colony, give you feed it the right growth media. What the temperature right was their humidity was there. Was the organ in the active growth space and on and on. However, the value of these direct cell detection devices is that we can see the cells. The cells are viable. And so we can see the microbial cells. However, these cells may not go on to form a colony. And in the regulatory bodies, such as the USP and also overseas, the language really talks about -- the value of these online methods is that these cells may be present. These microbial cells are present yet, they may not go on to form a colony. And the percentages are pretty, I'm being able to pull an organism from an ultrapure water system, or water-for-injection system. It's very highly unlikely that you may pull that organism out of the water system and be able to grow it. You have these online systems, we can see those cells. So the -- in the first case study, we saw no correlation between the AFU levels and the plate counts because the plate counts were not are not conducive. They were all zero at very, very high microbial cell count. And why was that? The customer surmised well, it was very likely that, that but whatever it is, or a group of organisms were viable, but not culturable. They were viable because we could see them with the 7000RMS. We don't look at dead cells for these cells are living, yet the organism was not able for whatever reason to form a colony. In the second case study, we actually -- the customer actually was able to grow these organisms on plates. And so then they were able to do some comparison studies. AFU levels to colony forming unit levels, and they actually did see a correlation that as the AFUs went up, as did the colony-forming unit. So it really just depends on the state of the organisms that happen to be in the environment in your water system.

Okay. Thanks, Peggy. Let's move on to our next question, which is how do online RMS measurements correlate to online TOC and conductivity measurements?

That is a great question. And I think that as we collect more data from comparing all of these parameters together. We'll be able to better address that question. And it really depends on the different environment in your water system. We know that TOC and microbial protection, even in all of these -- for example, the USP or the EMA, documents, they tell you that you really can't use TOC to correlate with microbial detection, either the TOC can be food for a bug or the bug can be food for itself. So you can't really correlate the two, but it's great to be able to have all of those measurements together. I mean that is what water system owners are doing now with online TOC and connectivity measurements, they're trending them all the time. And the value is that we now see a change very, very quickly when the status of our water system changes. We've never had that with microbial detection. So we're hoping to be able to provide more trend data as customers share their data with us. And so it will be interesting in future case studies where we'll actually be able to show those trends.

Excellent. Thanks again. All right. Let's move on to our next question. Can real-time measurement replace the traditional plate count method completely?

No, not today. Not today, the compendial measurement is the plate count. So -- but -- so that -- and what does that mean? That means that in order to release your water for manufacturing or to production, you must verify with the plate count. And those limits are set up in one of the international copters of USP 1232, which is water for pharmaceutical use. Interesting that for water, we do not yet have a test chapter. However, that compendial measurements still has to be the plate count, but you certainly can use the online detection devices to -- in conjunction with your plate counts, in order to prove process transparency, reduce risk. You know you're always dropping your play counts, but wouldn't it be really nice to know that while you're waiting for those plate counts to come back, 3, 5, 6, 7 days that your water system is not the problem because your online detection device is -- you have historical trends, and they're not changing.

Excellent. Thanks again. Our next question, and I think you might have touched on this earlier, is how do AFU and CFU correlate?

I never like to say that you should use the word correlate. They can compare. But as we saw in the two different plates -- two case studies, is that in the 7000RMS, we're using laser-induced fluorescence and a particle -- particles, the presence of particles to determine the presence of a microbial cell. In the colony forming unit, we have selves that may or may not go on to form a colony. So it's really tough depending on the organism -- in the case that Tracy mentioned earlier, where we have Burkholderia and we have Ralstonia, part of the reasons that customers are interested and online detection is that they're not getting any -- they're not getting growth on their plate count, at least not consistently. So they have no idea where the root cause is. It's really tough. So these organisms may go on to grow on your plate. If you hold them longer than 7 days, some people only hold their plates for 7 days. So it's really, really hard to get a comparison between the very, very different measurement units. Hopefully, I've answered that question.

Thanks so much. Let's take a look at our next question, moving along. Can the 7000RMS be used on lesser quality water systems such as potable water?

No. I mean theoretically, laser-induced fluorescence and particle detection technologies could be used. We don't recommend that with our instrument. The instrument is designed for pure water sources because we're using photo detectors to make actually as part of the measurement. So the dirtier the water -- sometimes can really overwhelm those detectors. So our instrument is designed for more pure water sources such as purified water, water for injection. UPW, but not for the pre-filtered waters.