Repligen Corporation (RGEN) Earnings Call Transcript & Summary

Good morning, everybody. I'm Tycho Peterson. It's my pleasure to introduce our next company this morning, Repligen. [Operator Instructions] And with that, let me turn it over to Tony.

Thanks, Tycho, and appreciate the opportunity again this year to present at the JPMorgan conference. Goal today will be to bring everybody up to speed on all the activities at Repligen over the last 12 months, talk a little bit about 2021 and set the stage for the next 3 to 5 years. But before jumping in, I just want to take a moment to reach out and thank all the Repligen employees. As everybody knows, 2020 was an incredibly challenging year. Our team did a phenomenal job, basically kept all our manufacturing sites open, all our service support sales, customer service people out working with customers. So from myself, from the management team, just a big thank you from all of us. So jumping into the presentation and moving to Slide 4. I think most people know us as a -- that we're one of the bigger players now in bioprocessing. We're very focused on delivering single-use technologies that improve yields for our customers that drive efficiency in the manufacturing facilities that gives our customers a lot more productivity. And over the years, really since 2014, we've developed a very diversified portfolio of products that's resulted in essentially $350 million in sales for Repligen in 2020. But probably more importantly is the fact that our pipeline is now beginning to grow and expand. Traditionally, we've been more in the clinical setting. But because now our portfolio has expanded, the clinical opportunities have moved into commercial opportunities, and we're seeing a little bit more balance of clinical and commercial. In parallel, if you went back to 4, 5 years ago, we would talk pretty much around our focus on monoclonal antibodies. But what's happened in the last few years is that we've now expanded into the world of gene therapy. We've always been in vaccines. But obviously, in 2020, COVID has been -- come a really important part in terms of the programs and activities for all players in the bioprocessing arena. For Repligen as a company, we've really gotten to a point now where our portfolio is highly differentiated, this is how we compete, we have a really nice blueprint for growth that's a combination of M&A and R&D, and this portfolio of disruptive technologies that we've put together is what we've continued to invest in. So we're spending a fair amount of CapEx on an annual basis, over $30 million in 2020, probably well over $40 million in 2021. So we're expanding our capacity, but we're also adding our in -- people into the equation for us. And so we've moved from about 120 people in 2014 to over 1,200 people here at the start of 2021. So moving to Slide 5. So how are we going to continue on this growth trajectory and sustain the type of performance that we've been able to produce over the last 4 or 5 years? I think it starts with how we set up as a company and what are the -- how do we set up our businesses. So we have 4 franchises in filtration, chromatography, proteins and analytics. And within each franchise, we have an anchor business but, in some cases, more than one that really drives the growth of that particular franchise. So in filtration, it's the combination of membrane technology, be it hollow fiber or flat sheet membranes, combined with systems that complement these consumables that we have in our filtration portfolio that's driving our overall filtration growth. In chromatography, our anchor technology is OPUS prepacked columns. And we've been working on OPUS really for the last 7 or 8 years, and we're the market leader in that space. In proteins, we're well known for what we've done in the world of affinity -- ligands and affinity chromatography and that's really the foundational piece for us in proteins. And then in analytics, which is really a new franchise for us that came into the company as part of the C Tech acquisition. Our goal here is to really focus on at-line, in-line monitoring of important parameters for our customers. And in this case, its protein concentration measurement or in other examples, it can be nucleic acid concentration measurement. So the other part of the equation for us was that the majority of our revenue has always been consumables, and we wanted to balance the consumables out with capital equipment. And over the last 3 years, between the Spectrum deal and the deals we did in 2020, we now have really nice balance in terms of capital equipment and consumables, and we're really at this 80% consumables, 20% capital equipment. As I said, 2020 was a really good year. If you take midpoint of guidance, about $350 million, growth up around 30%, margins expanding and EBITDA margin up around 29%. So we continued to expand, we continued to invest in capacity, very focused on these disruptive technologies, whether it's single-use ATF, SoloVPE. It's important for us to be able to scale these technologies and deliver value to our customers. We're also delivering value to our shareholders, and you can see that with our 33% CAGR over the last 5 years and a threefold increase in adjusted EPS, which is on Slide 6. So moving to Slide 7. You can't be successful unless you have strong end markets. And in our case, the biologic markets that we play in have been really great, not only for Repligen but everybody in our field. If you move to Slide 8, you can see that these end markets really are the foundational piece for the bioprocessing market. And we would estimate right now that the bioprocessing market is about $12 billion in size and the projections for the next 5 to 7 years is 9% to 12% growth in that time frame. So we split the bioprocessing market really into 3 pillars. Number one is really the monoclonal antibody market, which has been around for a long time, but we see continued increase in the number of approvals on an annual basis, now 120 drugs approved by the FDA, over 600 drugs in clinical trials. It's the bread and butter of every bioprocessing company in terms of where we play and how our products are geared towards the manufacturing of these drugs. But over the last few years, gene therapy has emerged and cell therapy as well, and you can see there's almost over 1,000 clinical trials now in the cell and gene therapy space. And then more recently, obviously, in 2020, COVID became really important. And with 2 early approvals, emergency use and over 1,000 to 1,500 trials going on, it's a really important part of what's happening in our marketplace. But if you talk to our customers, they will tell you that 60% to 70% of our customers are planning production increases. So when you think about the health of the bioprocessing market, we think it's incredibly healthy. We think there's a long road ahead in terms of opportunities, not only for Repligen but for everybody in our space. Now as I said, we've been very focused on the monoclonal antibody industry, and we haven't spoken that much over the years in terms of how we play in gene therapy and in vaccines. So on Slide 9, the gene therapy story for Repligen is really around plasmid processing and viral vector manufacturing. And our goal as a company is really around how do we help our customers increase viral vector production, how do we accelerate the time it takes to bring products through the manufacturing process and into market and how do we improve overall purity and yield for our customers. So in 2019, about 15% of the revenue of Repligen came from gene therapy and majority of that was really coming from our filtration portfolio. In 2020, we saw about a 30% growth in the market for Repligen. Now what we did here was we subtracted out any gene therapy companies that were working on COVID vaccines because we felt like we really need to do sort of an apples-to-apples comparison. So 30% growth in 2020 and 75 significant accounts that we're working with today. If you move to Slide 10, we show a little bit of what's going on in the world of COVID. And again, 2020, and a really important year for us, the COVID revenue accounted for about 10% of our total revenue of the company, about 40% to 50% of our order growth came from COVID. And here in 2021, we're anticipating about $50 million to $70 million of revenue will come from COVID-related vaccines and therapeutics. And the majority of what we are working on is really in the vaccine world. We're seeing tailwinds in our filtration business and chromatography and some in our proteins. We're working very closely with mRNA, viral vector recombinant proteins and therapeutics. And we've put a list of companies that are well known to everybody in terms of who's playing in the world of vaccines and therapeutics. And I can tell you, we are working with the majority of these customers with some of the products that we have in our portfolio. Moving to Slide 11. So we'll talk a little bit about our addressable market, which is on Slide 12. We see 4 franchises as we talked about a few minutes ago. We'll start with filtration. So within our $3.7 billion TAM, $2 billion of that is filtration. We have about a 10% share. Last year was a great year for our filtration portfolio, up over 35%. We clearly see ourselves as a leader in the upstream part of the filtration market, and we're taking share downstream. The addition of the ARTeSYN, EMT and NMS businesses really helped us in 2020 and has added almost $300 million to our overall TAM. On the proteins world, obviously, we're known in the affinity ligand space, 10% to 15% market share, really good year last year, very similar to 2019, 15% to 20% growth and expanding portfolio of products. In process analytics, as I said, this is the C Tech business, 5% share, 25% to 30% growth in 2020. We clearly see ourselves as the leader in protein concentration measurement. And one of our goals over the last year has been to really expand the applications of this technology. And then finally, the chromatography franchise, up around $500 million. We have about a 15% to 20% overall share here, 15% growth in 2020, clear leader in prepacked columns. And again, the addition of ARTeSYN, where almost half the revenue in ARTeSYN goes into chromatography, is a real boost to us in the world of chromatography because now we have not only systems, we have prepacked columns, we've also got the fluid management piece and flow paths associated with those systems that will go into chromatography. So very differentiated portfolio. If you move to Slide 13, we're going to talk now about the blueprint for growth for Repligen, which is a combination of M&A and R&D. And that's detailed on Slide 14, where, when we look at deals, we're looking for technology leadership first in bioprocessing. We want whatever company we're talking to, to be really strengthened or add to one of the franchises that we have in our portfolio. Typically, these companies are underinvested in a certain area, sometimes it's commercial, other times it's R&D. We look for strong revenue growth, some margin expansion or margins in line with what we see as our corporate average, but the ability to be accretive within the first year. If you look at the first 5 deals that we've done, 4 of those 5, we've invested in the commercial organization, Refine, Atoll, C Tech and TangenX. Two of the companies, we had to do a fairly big investment into operations. And then finally, there's always some investments in R&D. On Slide 15, we'll just talk a little for a minute about these first 5 deals. It's important to point out that the way we've built our filtration franchise has come from M&A, but it also has come down the road from the investment we've made in R&D. So Refine, TangenX and Spectrum really are the foundational pieces that have built out of our filtration franchise. Atoll was added into our chromatography portfolio in prepacked columns. And as I said, we entered into process analytics with C Tech in 2019. One of the things we do as a company, and it's a real measurement of our ability to integrate these companies successfully, is look at the first full year of growth after the acquisition. And in the case of all 5 deals, we've been anywhere between 24% and 48%. I'd like to sort of have a small shout out here for the C Tech business. This came off a 10% growth pro forma in 2019, and we really set about our goal of building out the commercial team, added in 10 people, expanded the applications, brought new products to market, and we ended up at the end of 2020 with greater than 27% growth through the first 9 months and in the 25% to 30% growth for the year. So moving to Slide 16. 2020 was a busy year for us on the M&A front. We did 3 deals They were all related -- it was all around fluid management and systems. We knew we had a really nice portfolio of products with our Spectrum systems. We wanted to really expand that into the world of chromatography and go after the -- after other applications in filtration. We also knew that the consumable with these systems was around the fluid management piece. So we did a deal to acquire EMT and NMS on the fluid management side and then at the end of last year, executed on the ARTeSYN deal. As you can see here, We have a nice growth trajectory for all 3 businesses in 2021, and we look forward to moving our systems portfolio into a more visible position for us in the company. So moving to Slide 17. The other part of our strategy is around R&D. And it is important as we do these deals that we reinvest back into the companies that we have acquired. And in the case of -- if you look at this list, everything from larger prepacked columns, like OPUS 80 to single-use ATF to gamma radiated flat sheet cassettes to more integrated systems and then technologies like next-generation flow and TFDF, which is a harvest clarification technology, all really important technologies that are highly differentiated in the marketplace. And if you marry that up with the portfolio that we have and you focus on partnerships like the partnerships we have with Navigo and Purolite and Sartorius, this is a really winning formula for us as we move forward, and we think this is the foundational piece for our growth over the next 5 years. If you move to Slide 18, I'll talk a little bit about how we scale our business, which is on Slide 19, it starts, and when I started in 2014, we had about 5 to 7 people in our commercial organization. Now we have 200 plus, 75% external, 25% internal. We continue to invest in R&D at 5% to 6% of revenue range, a really important part for us and I think for everybody in our industry has been around capacity expansion. We focused on filtration and chromatography in terms of our capacity expansion in the last few years. This is going to be our focus for 2021 as well. And as you can see, we have a significant number of manufacturing facilities around the world in terms of 15. If you move to Slide 20. I would just maybe finish this section by saying that we have a really good growth ahead of us. It's going to be fueled by new products and markets. The trends that we're looking at really match up well for us in terms of adoption of single-use technology, continuous manufacturing, greater automation. We're really well situated in terms of the -- and positioned in terms of the products that we have and how this will work for us. The emerging opportunities, I think we've shown that we can be successful in the world of gene therapy. We've clearly been able to work very closely on the COVID programs, whether it's vaccines or therapeutics. And I think the number of products that we have in our pipeline, some of which were launched at the end -- actually throughout 2020, positions us well for the future, whether it's TFDF in harvest clarification or its next-generation FlowVPE or its the new affinity ligands, all of these products positions us well for the future. So if you move to Slide 21, quickly talk about the financials of the company on Slide 22. Revenue has really accelerated substantially over the last few years, gone from $194 million in 2018 to the mid-3s in 2020. You can see that our revenue growth has stayed at or above 30% over the last few years. Our gross margins, very encouragingly, we've put a lot of effort into margin expansion, and we see that since 2018, now we're up around that 58% mark. Our operating margins continue to expand as well. So I think from a financial point of view, we're in really, really good shape. We've got the right blueprint for growth. We've got the right products coming through, and I think we've been able to demonstrate over the last 6 or 7 years financially how we can be a consistent performer in our markets. And then if you move to Slide 23, I think I'm finished by saying we're really well positioned for sustainable growth. We've got 4 great franchises that are all growing at very nice double-digit growth rates. We have high-impact technologies, whether it's ATF or OPUS or ARTeSYN systems or TFDF, all contributing in a very positive way to the company. Our addressable market, while it's a $3.7 billion in a $12 billion market, is growing rapidly. I think we are expanding as a company, expanding our market share. Clearly, a big piece for us as we move through the next few years is to continue to expand our manufacturing capacity and stay ahead of demand. We really like our R&D portfolio. We like our blueprint for growth, which is this combination of M&A and R&D, and we think our end markets are very strong. And so with $675 million to $700 million of cash in the bank, we think we are in really good shape to hit our revenue goal of $1 billion by 2025. So with that, I'll stop and turn it back to Tycho. So thank you for attending and listening, guys.

Great. Thanks, Tony. I'm going to start off maybe on just the COVID dynamic. I know you said it was 40% to 50% of order growth, 10% or so of revenue last year. Just talk through the durability of the trends there. I know you said also the majority is vaccines. Is that 80%, 90%? Can you just kind of help us think about the split? But more importantly, the durability.

Yes. So maybe on the split, yes, you're right. The majority is on the vaccine side. And I think as everybody knows, I think the vaccine manufacturers have moved through very, very quickly with our programs. Therapeutics are still coming through. We definitely have revenue coming from the therapeutic programs as well, but I think the majority is vaccines. In terms of durability, it's -- there are a number of companies, obviously, 2 companies that have come through with emergency use authorization, but there's still a number of companies coming through with Phase II, Phase III programs not only in North America, Europe, but also in China. I think durability, the way we look at it, is it's -- 2021 is going to be a huge year for the bioprocessing industry in terms of keeping up with the demand that's required to -- for the vaccines in COVID. It's probably going to last while into 2022. I think the big question, Tycho, is going to come down to frequency of vaccination. Is it going to be once a year or is it going to be once every 2 years? That's going to determine a little bit if we're going to see this -- if you look at 24 months of strong revenue growth for all bioprocessing companies and then you're going to have a soft period if it's a one and done on the vaccine. But I think most people believe there's going to be some repeat on the vaccine, whether it's on an annual basis or every 2 years. And I think once we got a little bit more data mid next year or mid this year, I think it will give us a little bit better indication of what the frequency is going to be. And I think if there is a dosing frequency of 1 to 2 years, I think then you kind of hit a new plateau for bioprocessing and it builds from there.

So are you already starting to have discussions with customers about locking up supply in 2022, 2023? Or is it too early?

Yes, it's too early. I think most of the -- at least I'll speak for Repligen, most of the conversations we're having is really around 2021, first half of 2021. Demand, definitely visibility into the second half of the year but really a huge focus on the first half of the year in terms of delivering product.

You talked about, I think, 60% to 70% of customers' planning capacity increases, which is great, and the industry is, obviously, doing incredibly well. I mean how do you think about supply-demand dynamics? And could we run the risk of excess capacity at some point a couple of years down the road?

Yes. I mean that's come up a lot actually this week. I'm not worried about the capacity piece, and I would look at it through 2 lenses. One would be the lens of our customer who -- customers who are expanding but also the bioprocessing industry that's also investing significantly in capacity expansion. I think this is an incredibly healthy market. So even if there's a sort of a dip in terms of revenue coming from COVID vaccines and therapeutics in a couple of years, I don't think it's going to take very long for the industry to catch back up and utilize any excess capacity that comes available. So not at all worried about capacity excess. I think just a really great industry to be in. And I've had the -- I have the lens of having been in the industry now for quite a while. And I would say, if you look at where we were all standing in 2010 looking at the 2010 to 2020, I think the industry is much healthier today than it was 10 years ago, and we really only had 1 year in the 10-year period between 2010, 2020 that was a flat year and that was 2017.

Question over e-mail is just how does market share in COVID-19 vaccine and therapeutics compare to your overall share in bioprocessing?

Yes, that's a really tough question. I don't think I actually know what that percent is. I would say that if you look at our growth for non-COVID programs through 9 months of last year, it was I think on the high end of 15% to 20%. I believe that our COVID revenue growth was a little higher than that. If you look at our order growth, 50% of our order growth is coming from COVID programs, 50% from non-COVID. So I would say we are growing, obviously, faster than our own sort of organic growth numbers, but I haven't been able to take that and say, okay, in the world of COVID, are we taking share, are we just getting a fair amount of share? It's just really hard to know at this stage. But obviously, it's an accelerator for us, and I think we've shown over the last, say, 3 to 5 years, Tycho, that we've been able to operate at a growth rate that's above the market growth rate.

You talked a fair amount about gene therapy with 15% of revenues in '19 growing to 30%. Where do you think this could go? And do you have kind of what you need there in terms of portfolio? And a lot of companies talk about cell and gene therapy under the same umbrella. You're really just talking about gene therapy. So curious about how you think about cell therapy as well.

Yes. So the piece that maybe the overlap is really on the viral vector side, so we're working with AAV, we're working with lentivirus. So there's a little bit of the cell therapy piece that comes through with lentivirus plasmas. But you're right, it's viral vectors and plasma, this is our focus. I think that's going to continue to be our focus for the foreseeable future. We have a great portfolio of products right now. I think the addition of ARTeSYN actually even helps us further, but there's some work we need to do. But the systems and the low hold up volume that ARTeSYN brings to the table are real needs within the gene therapy space. So obviously, we love to see what else we're going to do in terms of R&D projects, applications that we think are going to be really important. But look, like even last year, one of the things we focused on was really extending the applications for C Technologies, Solo and FlowVPE into the world of gene therapy, and that's been successful for us. I think there are other products in our portfolio that we can apply into the space, and we're going to stay focused. We're not going to get ahead of ourselves here, but we like what we have. And I think we're -- we understand the needs of our plasmid and viral vector customers.

How about the risk profile of some of these build-outs? I mean Sarepta, last week, obviously, had a blow up, I mean their high-risk projects. I mean do you have customers reevaluating any of these projects or is it just to assume that high risk, high return?

Yes. Look, the way I look at -- yes, it's unfortunate. I mean, there were some, obviously, speed bumps as well last year with other companies. I kind of equated a little bit to -- you have to almost go back to the 1990s and look at the monoclonal antibody industry and there was plenty of start stops in terms of products getting approved, not getting approved. I think we're just going through that growing pains. There's just so many products in clinical trials, but the expectation is going to be that they're going to move through Phase III, get approved, any of the manufacturing issues that have been cited for some of the drugs that got delayed, they will get addressed. I think there's a high level of confidence, not only at the bioprocessing level, the CDMO companies are highly confident about their capabilities. I just think it's a part of the market that's here to stay and absolutely unfortunate about Sarepta, but I think there'll be other products that are going to come through as well. So we'll wait and see.

Question on kind of the longer-term outlook. 2025 revenue target now $1 billion. It had been $600 million in 2023. Can you maybe just talk to that bridge?

Yes. Look, it just comes down to the pace that we're growing at, Tycho. We've been able to execute on M&A. So some of the deals that we've added in have really helped us in terms of driving that top line revenue. We've been able to address some of the shortfalls that some of the companies that we've acquired needed, so -- and mainly it's been on the commercial side, and I think C Tech is a perfect example. So when you look at our portfolio, look at what we have in R&D, we see -- we've always had a kind of a 10% to 15% organic growth as a sort of a long-term view of the company. I think we're more now at that 15%-plus range. We expect to do more deals over the next few years. We think that our products are getting adopted. We have -- because we're differentiated in the marketplace, there's a little bit less competition. And I think all of those things factor into a fair degree of confidence that we'll be able to hit $1 billion by 2025.

Competitive question we've gotten a fair amount over the past year is just you've got Avantor now getting into the Protein A market. How do you feel about having a new entrant there? Is there enough market growth that it won't have an impact? Or how do you feel about the competitive dynamics around Protein A?

Yes. the Protein A market has been highly competitive since 1995. So one more player into the market is probably -- it's not going to change the overall dynamics. I think Avantor have some good products. I'm sure they've got a really good strategy about how they want to take share. But there are a small but concentrated number of competitors here that have done a lot of work over the last 30 years and some more recently, like Purolite over the last 5, 6 years, that it just -- it's a competitive market. I think adding one more player into it, I don't think, changes the overall dynamics that much. And in the end, this is all about best technology, Tycho. It doesn't really matter if you're Cytiva or you're Millipore or you're Purolite or you're Avantor if you've got a great technology and then it can get evaluated and it will get implemented by our customers. So best technology wins. And I think we've shown with what we are doing, and we haven't really jumped in, as you know, into the resin part of the equation. We've been very much the supplier of the affinity ligands and have partnered with companies like Purolite on new technology. I think that's -- will stay the strategy for us on the Protein A side.

You noted share gains in filtration downstream. You've obviously got ATF, TFF, HFF, you've got a good portfolio there. A, are there still gaps to fill around filtration for you? And then b, can you maybe just talk up to those share gains?

Yes. So look, it's a little bit like what I said on the Protein A space. A lot of times, it's around best technology. So the -- probably the biggest gap we had on the filtration side was the lack of systems outside our hollow fiber portfolio. So being able to do the ARTeSYN deal gave us not only the filtration systems to complement what we have with flat sheet cassettes, so you need higher pressure pumps, which is something we just didn't have, would have taken us a number of years to have developed that. So getting that from the ARTeSYN deal was really important. I should point out that the ARTeSYN portfolio is a single-use flow path system. So in other words, it's not the traditional stainless steel piping that you would see in a chromatography filtration kits. Everything in this kit is essentially disposable. And so think about our play in filtration or even in chromatography, we've added in not only a capital equipment piece, but we've also added in a new consumable. So that flow path, every time you do a production run, that is a consumable. So that's a consumable when we think about what we're doing in flat sheet cassette filtration, it's a consumable in chromatography. So that adds some dimensions to what we just didn't have before. So it fills -- between EMT, NMS and ARTeSYN, it fills a lot of the gaps that we had in our filtration and chromatography portfolios from a system and also adding in additional consumables into the mix. So in terms of taking share, I do think comes -- it comes down to technology innovation. We can clearly see upstream, right, that the combination of ATF and TFDF is a really winning combination on the harvest clarification side. And when you go downstream, I think adding in the systems part into what we already do with flat sheet cassettes and all the progress we've made with hollow fiber technology, not only the consumable but also the systems, is where we're continuing to look at in terms of taking share.

A couple of quick follow-ups on the COVID discussion earlier. You're launching a new chromatography resin for COVID vaccines. Can you maybe just touch on the opportunity for that? How you think about recombinant protein vaccines versus mRNA? And then the scale up around the vaccines has largely been around single-use technologies. Do you expect that to remain single use? Or will it shift over to stainless steel for kind of large-scale production down the road?

Okay. On the first part of the question, I think the spike protein ligand that we've developed, working with Navigo, we've now got that on chromatography resins. We've got evaluations going on. Results have been very encouraging with the groups that we worked with. I think it's going to be hard. I don't know the answer to it yet, Tycho, but a lot of companies that really like the technology are well along in their manufacturing process for protein-based vaccines. So it's hard to say whether it would end up in the current round of vaccines or would it end up in a next-generation version. So I think more likely to be in the next-generation version. We'll come out with our guidance, obviously, in 4, 5 weeks' time for 2021. But as of now, we wouldn't be putting really too much revenue into the spike protein or the spike resin for Repligen. In terms of -- the second part was on -- I'm sorry, can you...

Single use versus stainless steel for vaccine, the early production single use, but will that shift over to stainless steel for bulk production?

Yes. I think the jury is out a little bit on that one. I think everybody who's making a vaccine right now is so laser-focused on ramping up their production, getting to the scale and output that they're looking for that I think the number of conversations on, oh, we're going to move away from single-use and we're going to go to stainless steel. Just -- maybe they're happening, but it's not visible at least at my level. I think there's just a laser focus on capacity, on getting product delivered, on getting vials of vaccine produced. Yes, it's possible that when we get into 2022 and 2023, that there will be a shift back. But right now, I'm not seeing it.

Can you maybe just talk about -- you highlighted the strong balance sheet, $675 million, $700 million in cash. Can you maybe just talk about M&A priorities, the particular focus areas? And should we expect a couple of deals this year like we saw last year?

Every year is different. I suppose at the beginning of last year, people were asking us, okay, you did C Tech. Are you thinking about other deals? And we're always talking to companies. And sometimes, it just lines up that you can do 2 or 3 all around the same time, which is what happened in 2020. Look, the path that got us to where we are right now in the mid-3s in terms of revenue is the same path that we need to stay on over the next 4 or 5 years. And so expect to see 4 to 6 deals over the next 4, 5 years, for sure. But it's also the investments we're making internally and bringing out the next-generation version of products. And I'll just say that we're really bullish on the FlowVPE technology from C Tech, we're really bullish on the TFDF technology. It just takes a little while for the industry to adopt and ramp. But from my perspective, we probably are in a better position now, Tycho, than we were in 2014, 2015, when we were starting kind of the M&A piece of the equation for us. We've got so much -- many more products in our portfolio. We have a lot of ideas what we can do internally in R&D. We've got a really good balance between systems and consumables. So expect we'll continue to invest significantly in on the R&D side. And as we see assets that make sense for us, whether it's in chromatography, filtration, proteins or analytics, we'll add those in. But I don't think we're as reliant on M&A as maybe we were just to get our portfolio built up, and we'll see what comes through.

On FlowVPE, I'm glad you brought that up. It was a good acquisition you did. What do you think it takes to drive broader adoption and accelerate the demand curve in process analytics?

Oh, in process analytics? What's interesting about process analytics is something that I'm very familiar with because of the business that I put together at Life Tech. Look, I think the industry absolutely wants to move towards at-line and in-line testing. And I think we're well positioned with what C Tech has. I think the biggest challenge C Tech had, and we'd be beginning to address that in a very positive way, is that it was very reliant on kind of the monoclonal antibody side of the equation and really hadn't moved into a broader application base. So I think there's a lot of applications for the C Tech business. And then we have to look at that and say, are there other technologies out there that would complement not only what we're doing with C Tech, but it is a natural fit for the channel? Because we created a separate sales channel for the C Tech business. And now that we have the channel and now that we have expanding applications, I think there's an opportunity to build that portfolio into a broader portfolio of technologies.

Great. Well, we hit the end of the session, Tony, I want to thank you for taking the time. It's a great overview, and enjoy the rest of the conference.

Yes. Thanks, Tycho. Thanks for the opportunity.

Thank you.