Veeva Systems Inc. (VEEV) Earnings Call Transcript & Summary

Thank you, everyone, for joining us here today for our Annual Analyst and Investor Day. This is the first time, obviously, that we've done this 100% virtually, so please bear with us. I'm Rick Lund, Head of Investor Relations here at Veeva. Please don't hesitate to reach out to me or to my colleague, Ato Garrett, if you ever have questions or need anything from us, either in the wake of this event or at any point in the future. Some quick notes before we begin. We've got a series of presentations for the next roughly 90 minutes or so, which will include a fireside chat with a customer and a demo of our software. At the end of all of the presentations, we will have a dedicated Q&A session. So if you have questions at any point during the program, feel free to send them either through the Q&A chat on the webcast or via e-mail. The address for that is [email protected]. And so finally, bear with me while I read a quick disclaimer. During the course of today's presentations, we will make forward-looking statements, including statements regarding trends, our strategies and the anticipated performance of our business. These forward-looking statements are based on management's current views and expectations and are subject to various risks and uncertainties. Actual results may differ materially. Please refer to the risk factors included in our most recent filing on Form 10-Q which is available on the company's website at veeva.com under the Investors section and on the SEC's website at sec.gov. Forward-looking statements made during today's presentations are being made as of today, October 29, 2020. If the presentations are replayed or viewed after today, the information presented may not contain current or accurate information. Veeva disclaims any obligation to update or revise any forward-looking statements. In the presentations, we will also discuss certain non-GAAP metrics that we believe aid in the understanding of our financial results. A reconciliation to comparable GAAP metrics can be found in the appendix of today's presentation, which will be posted on our website. And with that, thank you again for joining us, and I will pass it off to our Founder and CEO, Peter Gassner.

Good morning, and thanks for joining our Investor Day. We hope to give you information so you can better understand Veeva's current operations and our future plans. Vision and values is how we operate the company. I present this slide at least 10 times every quarter. We start every Board meeting and leadership team meeting with it. Understanding this slide is a key piece of understanding Veeva. Our vision is what we're doing. We're building the industry cloud for life sciences. That's software, data and services to help the life sciences industry become more efficient and effective. Our values is how we make decisions. First is about doing the right thing, about being honest and having the proper morals and treating others as we would wish to be treated. And then about customer success, which has 3 parts. First is for the people in life sciences. They should enjoy working with our products and our people. And then the companies in life sciences. Our products and services should deliver positive ROI. And finally, for the industry overall, we should help the industry overall become more efficient and effective. I can summarize what you'll see today with 4 points. First, we've been executing consistently due to our operating model. Second, 2020 has been a year of strong innovation for Veeva. Due to that innovation and consistent execution, we're becoming a very strategic partner to the industry. And finally, we're still in the early days of the industry cloud for life sciences with plenty of room to grow. Taken together, this sets up Veeva well for 2025 and beyond. Let me hit on some of the major areas of innovation that will help fuel our growth into the future. For the first time this year, we have announced applications that are for consumers, for doctors and patients. This is a big deal for Veeva, something we have not done before. MyVeeva is our brand for these consumer-facing applications. To make it clear to everyone about who is standing behind these applications, Veeva is behind these applications. For the past few years, we've been thinking that consumer apps were in our future to make it easier for doctors and patients to connect with life sciences. But then the pandemic hit and it was very clear. The time was now, and the industry needed Veeva to step up. So we assembled our product teams in the spring, and we've made a lot of progress since then. MyVeeva has 2 forms. An app for patients and an app for doctors. Both of these applications will start with very targeted use cases and add functionality over time. You'll hear more details about these applications from Jim and Paul, but let me give you the basics. MyVeeva for Patients is a way for patients to easily participate in clinical trials. MyVeeva for Doctors is a way for doctors to easily connect with experts in the life sciences industry. MyVeeva is free for doctors and patients. Revenue will come from life sciences over time based on usage. MyVeeva is a major step for us. We'll start small, and we have a lot to learn. But we're excited about the potential. We also had major innovation in the clinical area this year. Clinical trials are fundamental to life sciences. Today, clinical trials are inefficient. They're full of paper and not easy for patients. This slows down trials. It's a big problem for the industry and for patients. We have a bold vision to change the way trials are executed. We want to make clinical trials paperless and patient-centric. The clinical network is how we get to our vision of paperless and patient-centric clinical trials. To do this, we need great software that's connected together. First, for the sponsor, the life sciences company running the trial and paying for the trial. And for the clinical research side, this is the hospital or clinic that is treating the patient. And of course, the patient themselves, the real customer. Our vision is to provide free and easy to adopt cloud software to the research sites and the patients and then connect them up with sponsors to provide an integrated and paperless flow of data. This is a big undertaking. Nobody has even tried to solve this problem before. You'll hear more about clinical network from Jim. And Data Cloud, part of our Commercial Cloud. This started a year ago in November when we acquired Crossix. Crossix is a marketing analytics platform for life sciences. It's a great business, and it continues to grow. And we've integrated Crossix with our CRM system. But the real jewel in Crossix is the underlying data and technology asset, the Crossix data platform, that has terabytes of data on 300 million patients in the U.S. It's built in a unique way to ensure privacy and accuracy. We're using the Crossix data platform to build the Veeva Data Cloud, and it's going really well. I'm very happy with how the team is executing. We are innovating. We're not just copying the current legacy approach, we're innovating across the board. Let me highlight a few areas of innovation. Data sources. We're taking a much different approach to how the data is sourced. Delivery. We're delivering software and data together in a new way, not just data files. And openness, today, the legacy providers put limits on how the data can be used and what software can be used with. Customers will not have that nonsense with Veeva. It's very early days for Data Cloud. And it's going to take a long time to be the leader in the market. But make no mistake, that's our goal, to be the leader. I'm confident in our approach, and we're making great progress. We also continue to innovate in our operating model, our ways of working. With the pandemic, many companies have had to adjust to remote working. Veeva has always been a remote-friendly company. For example, we adopted Zoom 5 years ago, one of the first large companies to adopt Zoom enterprise-wide. But the pandemic inspired us to go a little further. We have become a work anywhere company. This means you can work in an office or at home on any given day. It's about getting the work done in the way that works best for each person. Now it doesn't mean that people can live anywhere. Customer-facing employees still need to be near their customers and product people need to be within 1 time zone of their product hub. We'll invest in our offices and make them places that people want to come into, but they don't have to come to. Our work anywhere policy is another example of how Veeva is leading in many areas. Now I'd like to talk about our relationship with the industry. Our innovation and the way we work with our customers and our response during the pandemic has really expanded our partnership with the industry. I can see it in our customer interactions. They are becoming far more strategic. That partnership is driven by the industry cloud for life sciences. There are really 3 main parts: our software where we started; our data, which is a big new area for us, especially with Data Cloud; and then our people, our services and the support people, consultants and account executives. This is why the industry cloud is so strategic and durable. It's a combination of the right software, data and people, all working together. When we think about the industry cloud, we think about helping each customer, but we also think about the industry and how we can help the whole industry become more efficient and effective. Going down on the people side, we've always had professional services to help our customers implement and operate our technology. Last summer, for the first time, we started a new area in Veeva, Veeva Business Consulting. Business consultants are Veeva people that help customers define and execute their commercial strategy. Our customers want great technology, but they also want industry experts to help them define and execute their strategy. Now what makes Veeva Business Consulting special? First, our consulting group is data-driven. There are experts in Data Cloud and the Pulse data that is generated by the Veeva applications. Customers also appreciate the tight alignment to the Veeva technology road map. And they appreciate being able to get all of this from Veeva. Business Consulting is off to a great start. When we talk about being a strategic partner, here's how we think about it. We think about the industry as a customer, we embrace this in our values, we are helping the industry get better. We also have to earn the trust of every customer every day, every product, project, supporting. We have to care and the work is never done. We have to lead. We have to bring innovation. Let me tell a small story that sums this up. We recently had a customer executive talk on our company call. It's one of our customers actually that's working on the COVID vaccine. At the end of the call, they said, we need Veeva to continue to be disruptive, to innovate. The industry needs Veeva to keep leading so we can reach our full potential. And that was so great to hear. We want to always deliver on that expectation on leadership. In terms of being a strategic partner, I'd like to provide context for our proposed conversion to a public benefit corporation. Why are we doing this? It aligns our legal charter to the multi-stakeholder way we run the company. In short, it aligns our charter to our values. It also shows customers that will be a partner for the long term. They can feel comfortable going all in with Veeva. And it will also help us attract mission-driven talent. All these things together will help us deliver better financial results over the long term. Veeva would be the first company over $1 billion in revenue to be a PBC and the first public company to convert to a PBC. That feels good to us. We like to lead. As I look ahead to 2025, I'm increasingly confident in our $3 billion revenue target. This is driven by our innovation, consistent execution and our expanding position as a strategic partner to the industry. But $3 billion is not the only goal. We want to get there with plenty of room for growth ahead. We planted some major seeds of growth this year and will continue to do so in the years ahead. And finally, still Veeva. That means retaining our core values, but still being able to change and adapt in our product and ways of working even as we grow towards 10,000 people. All right. Now we'll go into the next section, an update on our 3 main areas of business. Paul will give an update on Commercial Cloud, Jim will give an update on Development Cloud. And before I pass it over to Paul, I'll give you a quick update on our business outside of life sciences. Outside of life sciences, we're focused on enterprise customers in the CPG, cosmetics and chemicals industries. In terms of applications, our focus is in the quality and regulatory areas. So this is a very specific market for us with a TAM of roughly $1 billion. The business outside of life sciences is going well, although the cosmetics business has taken a hit from COVID. We have over 60 customers and a dedicated team of over 150 people across product, sales and service. And revenue this year will come in at over $30 million. When I look to 2025, we expect this area to contribute over $100 million in revenue. We're happy with our progress in this area and encouraged by the customer community we're developing. With that, I'll turn it over to Jim for an update on the Development Cloud.

Thanks, Peter. So as we look at R&D, there are 2 themes that are driving how our customers think about things and in turn how Veeva thinks about things. First, much industry is focusing their pipeline into more strategic therapy areas. And they're also inventing new modes of therapy, specifically precision medicine. And they all want to get there first, they're competing. And to do that, they're looking for capabilities to help them get there faster and more efficiently. And with more complexity in the science comes more complexity in the clinical trials that support the science. Sponsors are now looking for better ways to operate trials, to engage patients earlier and more often, and collaborate more effectively with the research sites they work with. And all this is around looking for more streamlined ways to share information. This has been magnified now by the pandemic. So far, we're doubling down. They are looking for efficiency. They're looking for better ways to streamline information share. Our solution to these challenges is the Development Cloud. Development Cloud is a unified set of business applications for each business area built on our common platform, Vault. And the idea is that each of these applications bring efficiency to each of these business areas from clinical data to clinical operations, to quality, regulatory and most recently, drug safety. And we've been building each of these product lines to be excellent. But we've also been hard at work bringing these together to be connected, to drive efficiencies that haven't been possible before with other technologies. We've done a lot over the last 8 years since Vault was released and especially in the last 4. We have a clear vision in place, and we're delivering value to our customers in each of the major functional areas. And it's a bold vision. The idea of 1 platform across the 5 major areas has never been done before. So it's quite a responsibility, and we take it very seriously. We're in this together with the industry. But we know the approach is right. We hear more and more from our customers that we are their strategic vendor for running their development operation. So we know the product strategy is right. We are becoming the technology engine of life sciences development. And that's a big mission. And it's a big mission where we're still in the early days. Not all the applications are mature for sure. To give a sense of that and to be specific about what I mean by early days, as you can see, some of our initial applications are in the middle majority phase with many larger life sciences companies using these. But we're still at work and bringing on more delayed adopters. But the majority of our products are still very early, and this follows our reference selling model. So for example, with a product like CTMS or Registrations or Startup, these are in the middle majority where they either come as a secondary attached to the more mature applications or as an internal reference sale from another department in the pharma organization. And then we have newer products which are in the early adopter mode, usually about 1 to 3 years old. And these are all about finding the right early customer. We learn, we iterate together, we make the customer successful, which in turn makes Veeva successful because the product becomes ready for wider adoption. And then finally, in our very new product areas, this is where we're just getting off the ground. This is where we're innovating with new and exciting products in the area of data and data flow and connectivity to sites and patients. So let's talk about some of our early adopter and new areas. So first, Vault CDMS and the progress we've been making there. First is that we've been delivering real innovation for our customers and for the industry. In the area of protocol amendments, oftentimes, when a protocol is amended, the technology that's in place today in EDC requires the life sciences company to migrate their database. And this results in both downtime and a risk of data loss. With Vault CDMS, there are no migrations involved with amendments to the protocol. The other area where we've been innovating with our customers is in steady build time. The industry average for study build time is anywhere from 12 to 16 weeks. With Vault CDMS, our customers are building their databases for their studies anywhere from 4 to 6 weeks. So much faster. And then we're also innovating by building new capabilities. Specifically in CDMS, we have a CDB. CDB is a centralized capability to clean and format data for submission. And this is very unique and differentiated in the clinical data technology space. But the second thing you note about CDMS is that it's ready. It's ready for use in prime time. It's being used across all study phases and all types of trials, including complex trials like oncology. We now have 2 of the top 20 pharma using Vault CDMS and over 40 customers in total. But we're not stopping there with clinical data. We recently announced that we're building a new product in the data space, Veeva Stats. Veeva Stats will be the first cloud-native statistical programming solution in the market. But it won't be just about bringing cloud to this important area. The second major point is that it will be better. It will be better than what's available to statisticians today. Statisticians today need to produce their analysis of clinical data as data sets. And to do that, they make programs. And in order for them to make those programs, they use a lot of disparate technology. There's lots of data shuffling that happens, and they're stuck with generic tools that are not made for clinical research. With Veeva Stats, we're bringing a clinical research-oriented statistical environment that supports all the major programming languages that statisticians expect, and it will be a lot more efficient than what they have today. Veeva Stats will be available for early customers by the end of next year. So we're going to have Stats now as part of the clinical data space. But what this will really do is deliver a more complete solution for our customers. Today, the process of collecting clinical data and bringing it all the way through to regulatory submission is fraught with peril. There's lots of hops that have to occur, multiple technologies, multiple handoffs just to produce a data set that's sent to a health authority. By providing Veeva Stats, we now provide the missing link between clinical data and the regulatory submission process. This is a really hard problem because there's lots of friction and there's lots of handoffs. And so with our approach, we're solving a very hard problem by connecting the clinical data process to the regulatory submission process. This will speed things up for pharma and make it a much higher quality process. Then we have Vault safety. This is a big complex area, and we've just got to start it. It's an incredibly important area to life sciences organization because if their safety system goes down, the products that they make stop being sold. So this is a very important mission for us in bringing safety to the cloud. Vault Safety is the first solution that is bringing safety to the cloud. And for our customers, that's incredibly important because what they have today with on-premise solutions means that every time there's a regulation change, they have to upgrade their safety solution. And that results in downtime, heartache and cost. So by bringing cloud safety, we're innovating. But we're also very early. We have our first 20 customers now using Vault Safety. We're learning from one another. We're iterating, and the focus is on customer success and product excellence so that we can drive our model of reference selling. And we're also being innovative by bringing artificial intelligence to the safety space as well as a new signal application for detecting safety events. So we're early with safety, but we're on a big mission. Now as Peter alluded to, we're doing something very big for life sciences as an industry and for our customers. And that's this idea of paperless, patient-centric trials. And we're going to do that by connecting the industry, and we're going to connect the industry through a big innovative vision to clinical network. The clinical network is an ecosystem that brings together and connects sponsors, research sites and patients. And we're bringing them together in this ecosystem through 3 major product areas. Our industry-leading Clinical Suite which is used by the sponsors, SiteVault which is being used by research sites, and our new product line, MyVeeva for Patients, which will be leveraged by patients and sites. Each of these is built to be a great solution on its own, but we're thinking more holistically by bringing these 3 components together, we will be able to accelerate clinical research for our customers and for the industry. So let's go 1 level deeper. Let's look at the bottom 2 rungs of the network. Here, we have the Clinical Suite where we have over 300 sponsor organizations using Vault Clinical, getting value, seeing efficiency in their trial operations. And then we have SiteVault, a newer product, that is key to this entire vision of the clinical network. Sites need something better than was out there for them today. They're overburdened with the tech that's offered to them, and they're looking for something that's made for them. And that's where SiteVault comes in. It's been made and built for research sites. And more critically, it's a free solution. By making it a free solution, it means we will drive rapid industry adoption, and we're doing well there. We now have over 600 sites. They are actively using SiteVault since January of this year. But then we're connecting these 2 groups. We're connecting the sponsor side with the site side with a new product. A new product on the clinical network called Site Connect. Site Connect automates the flow of information between sites and sponsors. And by doing that, it removes a heavy burden of manually shuffling paperwork back and forth to support research. I'm happy to share that we have our first early adopters on Site Connect, including a top 20 pharma. But let's come back around now to this clinical network and focus on the patients. As Peter mentioned, this group has not historically been treated like a customer like you see in other industries. And that's because it's really hard for the sponsors, the sites and the patients to collaborate with the kind of technology that's in place today. And the interaction is still mostly paper-based. And that leads to patients having a bad experience in trials and dropping out. And the bad patient experience can slow down the trial. So this is where we're innovating. We're innovating and setting out to change this landscape with a new product called MyVeeva for Patients. MyVeeva for Patients is both a patient portal and a mobile device application. It's a one-stop shop for patients across all of their clinical trial needs that allows them to connect with both sites and sponsors. It gives them a cohesive experience across their trial journey. We're going to deliver digital capabilities that will allow them to consent to a trial, provide feedback on how they're doing in the trial, schedule and conduct telehealth visits with the research site, ensure they're adhering to the protocol and the therapy regimen and then finally, to have their data collected in real time rather than on paper and transcribed to EDC, which is how data collection happens today, and that's e-source. This is a big multiyear effort for Veeva. We're just getting started by producing eConsent. Veeva eConsent will be arriving early next year and being used by early adopters. And then we'll continue to further build out the MyVeeva for Patients application and with adoption. So now, as you've seen with the Development Cloud, we have a strong foundation in place, and we have a clear vision that's working. It's a foundation from which we'll continue to innovate. And it's a foundation that will continue to deliver value to our customers and the industry, which will continue to fuel our model of reference selling. And I'm particularly excited because we're just getting started with significant runway for growth. Now we'll head into a 5-minute break before we turn it over to Paul Shawah for an update on commercial.

Hi, everyone. I'm Paul Shawah and I'm responsible for Commercial Cloud strategy at Veeva. Thanks for joining today. I'm going to talk to you a little bit about what's happening in the commercial side of the business and what our customers are most focused on, which is about digital transformation and digital excellence. Given what's happening with COVID in the marketplace, how do they better and best engage with their customers using digital to do that. So I'll give you an update on how we're helping move the industry to digital, and I'll also talk about some of our innovation in the space. The best way to get started is to have a little bit of context of what's happening overall in the broader health care ecosystem, starting with patients and with doctors. So COVID is having a really significant impact, really across all industries, but in health care, we're starting to see an impact on patients where they are starting to become more digital. If you look back at some of the numbers from February, really consider that pre-COVID where they were very, very low adoption of telemedicine to roughly where they are today, where they're north of 10% adoption of telemedicine. And the same for doctors who are enabled to use telemedicine where it was just roughly 3% to start. It peaked in roughly the April time frame at about 50%, and today, it's at about 42%. So we're seeing behaviors changing by patients, behavior changing by health care professionals. And that behavior change is spilling over into the life sciences industry where we're seeing some of the same kinds of impacts where the industry is looking to move to digital at a much faster pace. And we see that playing out, in particular, the promotional mix. So when I talk about promotional mix, think about it as the mix of face-to-face calls, compared with e-mails, compared with virtual meetings and other ways of engaging with customers. That mix is shifting dramatically. So there used to be a lot of face-to-face calls and a little digital. Now it's less face-to-face calls with a whole lot more digital mix in. And I think that promotional shift will continue to change and evolve over time. With more digital, we're also seeing an impact on the life sciences specific processes; themes change, consent changes, planning changes, the boundaries of what a territory looks like could change, incentive compensation changes. So it's stressing the existing processes. And it's also forcing companies to think about their overall go-to-market model; who are the kinds of people and roles that they need, engaging with our customers and what's the right mix that they should use for each customer. And if I were to summarize it, I would say, overall, the theme is accelerating their shift to digital, and that's really where Veeva has been focused on. And in fact, we feel really good and proud, really the entire team, of helping move the industry to digital a whole lot faster and really efficiently and really seamlessly. I have a couple of statistics to share with you that support that. There's a lot of different metrics we could share on this. Some 2 really good tangible ones are Approved Emails. So Approved Email, that's -- remember, that's an e-mail that comes from a rep, like a sales rep or a medical science liaison, someone who's in the field, that's a personal e-mail. It's not an e-mail from a home office marketing system, for example. Those e-mails, e-mails being sent, are increasing dramatically -- or increased dramatically since COVID. Now even before COVID, e-mail usage was quite high within Veeva. If you remember, that's been an add-on product that we've had for a number of years, and customers were using that to a large extent, and now they've increased that adoption. So that's increased dramatically. But also, we've seen a really significant uptick with Engage Meetings. Engage Meetings are those virtual meetings that happen, launched from within Veeva CRM, where they do a really seamless, compliant engagement with a customer over a virtual meeting, and that's dramatically increased. So we're helping shift the industry to digital, and we're seeing this play out. Now that sounds really easy. The perception of doing digital in the marketplace, sounds like, oh, you just hop on to a Zoom meeting and you can start doing digital or, hey, you just open up your e-mail and we send an e-mail. The reality is doing digital in a compliant industry like life sciences is actually quite hard because it impacts all of those foundational processes that are so important and so critical within life sciences. So the reality of doing digital is it touches everything that the field teams have to think about. How do they plan for their customer engagement? What kinds of content do they use? The duration of the call. We're seeing digital activities, digital calls going from 3 or 4 minutes face-to-face to 10, 20, 30, even 40 minutes in a digital environment. So the amount of content you use, the sequencing of content they use is entirely different in a digital environment. So there's a lot that changes and a lot of that is stressed in a digital environment. Now what our strategy has been with Veeva is to make all of that easy and seamless for the route. So we think about Veeva CRM as that foundation for doing digital and that foundation for making digital really, really easy. So all of those complex processes that I just talked about, which if you didn't have Veeva, you'd probably put into multiple different systems or handle them in a very manual way. We put them all into Veeva CRM to make it really easy for the rep, 1 to be compliant, but then 2, to maintain and execute down that digital interaction really, really seamlessly. So that's what we mean when we talk about Veeva CRM is that foundation to doing digital. So that shift that you saw to becoming more digital was enabled by the fact that the vast majority of the industry had Veeva CRM, was able to use technology like Engage to turn it on and make it look so seamless. Now Veeva CRM is certainly that foundation. But there's more than just Veeva CRM that's involved. And I would look at Veeva -- the overall Veeva Commercial Cloud in 3 big areas. I would call them data and analytics, engagement and content. And what we just talked about was Veeva CRM and Engage is that really that foundation for doing digital and I'll put that square in the middle of this picture where you're doing engagement and using Veeva CRM as that foundation. And Veeva CRM and all of the add-on products that we often talk about, they would form an engagement grouping. But also to do digital well, it's more than just the engagement. You need data and analytics and insights, the data that's going to help inform what you should be doing, how you should be interacting with your customers, what are the right messaging, where is the customer along their journey of adoption of a specific product, where are their patients? So that helps customers to really get more precise and more specific so they make the best use of those really valuable field resources -- valuable and limited field resources that they have. So data and analytics are really key component, and that's where you hear us talk about specific products like Data Cloud, which is super exciting, which is changing the way the industry is going to do patient data. It's a better solution for patient data. You hear us talk about Crossix DIFA, marketing and optimization for marketers that now incorporates data that comes out of the field and Veeva CRM with some innovations like Boost for DIFA. We also hear us talk about OpenData and customer reference data and then some of our data management products like Nitro as a commercial data warehouse and a data foundation. And then -- also, there's content. So as companies are doing more digital and as these conversations are lasting longer, in some cases, we're seeing customer conversations last 20 and 30 minutes, they're using more content and they're using it in more bite-sized components. So content becomes a really critical factor, and that's where PromoMats comes into play. PromoMats is that engine for getting content approved, but storing it and doing modular content, delivering on the promise of modular content, which is breaking content up into small pieces so that the industry can deliver it to all of these channels much more seamlessly and much faster. So when we put all of that together, data and analytics, engagement and content, those are the core foundational technology and data components. But what we're also seeing, as I alluded to earlier, there's a major shift in the -- how do you do digital? What does great digital look like? There's a lot of change that's happening in the industry. So what's happening is our customers are looking to Veeva to help them with that change. They're looking to experts from Veeva, whether it's on our strategy team or a customer success team or our Business Consulting team. We have people who are domain experts in this area, and they also have access to the really unique data that Veeva has. You heard Peter mention the unique insights that we have from looking across the industry from all of the companies that use Veeva, Veeva Commercial Cloud, Veeva CRM. We're able to use those insights to drive really specific recommendations for our customers that they otherwise wouldn't have. In fact, we had 1 customer talk at our summit about how they were going through a launch process. And they were planning for a traditional launch and COVID hit, and they relied on our Business Consulting team to entirely change their launch program to make it a digital first launch. So they're looking to Veeva as advisers and strategic partners. So that's a really significant shift that we've seen to digital, and it's being enabled by Veeva and Commercial Cloud and CRM is a really big foundation for that. But beyond that, we're helping the industry think more broadly around this idea of innovating in digital and doing digital more efficiently in flipping the model. The life sciences promotional model is one where it's often been focused on the life sciences companies thinking about who they want to target and then doing outreach to those specific targets. In fact, almost every life sciences company and really the brand teams within a life sciences company think about how they reach a doctor, and they have in place multiple ways of reaching people like sales reps and medical science liaisons and reimbursement specialists that call on doctors and HCPs and their staff, try to get them information, but they also think about digital promotion. Things like mobile apps and websites and portals in ways that they want the doctor to be able to find them online. So they want to provide an outreach but also a way for the doctors to come and find them online and be accessible at any time. So that's the theory and that's the logic. The challenge is when you flip the lens, when you look at it from the doctor's perspective. It looks more like this. It looks more like -- there's a doctor would interact with 10 or 15 or 20 different life sciences companies and maybe even 3 or 4 or 5 brands at each one of those companies. And it becomes overwhelming as to where they need to go to get the information and the service or even figure out who is their sales rep. Sometimes that's a difficult question for a HCP to answer. So this is what the problem looks like, and we're solving that problem with MyVeeva for Doctors. This is -- the focus of what we're trying to accomplish is make it really easy for HCPs to be able to connect with life sciences. Essentially, a way to think about it is to put the entire industry in the palm of a doctor's hand on their mobile phone or on a website, where as they're walking down the hall, they may have 30 seconds or 1 minute, they can get information, service, find a rep, chat with a rep much, much faster than they ever would have been able to do, which ordinarily may take hours or days or weeks or in a worst-case scenario even never happen. So that's the vision for MyVeeva for Doctors. Now a little bit about what it's going to do and how this thing is different. So a core philosophy of MyVeeva is that it's much different and much broader, and just having a website that brings together all of the industry or a mobile app that brings together all of the industry. So does it do that? Yes. But it's much, much broader than that. It's about connections and relationships between people. So on MyVeeva, you can think about it as a network that reps or MSLs can connect with doctors like they would do or like you would do on LinkedIn, for example. You can connect with people. And when you're connected, you're able to do things together. You formalize that relationship that you have. So you may connect with somebody that you have a very deep relationship with or that you've just met for the first time, and it allows you to enable a new set of services and information. And in the life sciences industry, that's often things like compliant communications, compliant chatting. We know that oftentimes there's promotional messaging and most companies don't allow reps to do that over a text message, for example. They will allow that via MyVeeva because it's compliant. scheduling meetings, finding reps, searching for a medical science liaison when they know they have a medical question, or finding a brand that they may need. Again, all from the palm of their hand. And then once they find them, to be able to get the information and the service that they need really, really quickly. So that's the vision for MyVeeva for Doctors. I want to show it to you. So I'd like to introduce Courtney to show you a really short demo of what MyVeeva for Doctors looks like.

This is a quick demo of the October release of MyVeeva for Doctors. We'll show how the app makes it easy for the doctor to chat with a rep, to find new reps and MSLs and to get content and support for their provider and their patients. We're starting on the doctor's phone. She has a quick break between patients to get some information she needs. When she opens the app, she can see her connections with reps and MSLs from different companies. She sees her connection to Mandy. She recently met with Mandy about a new indication for [indiscernible], and she just saw a patient who it could benefit. She taps on Mandy's name and types out a quick text asking for the safety information she wants to review before prescribing. Let's switch over to the rep view. Mandy, the rep, sees the notification on her phone and opens the app. Because MyVeeva is a monitored and compliant channel, Mandy doesn't have to switch to e-mail or some other channel. She simply picks the right information from a catalog of approved content and can immediately send it. Now our doctor has the information she needs. However, our doctor has another question about another brand, but this time she doesn't actually know who the rep is or even if her office has a rep. Normally, she'd be stuck. But with MyVeeva, she just searches on the brand and sees the people who are there to help her. She sees a rep, an MSL and a reimbursement specialist. Today, she'd really like to get a patient started with samples, so she taps on their rep, starts to chat and sees the samples and materials button. This shows her a list of things she can ask the rep for, like samples and co-pay cards. She picks the samples and also a patient explainer. The rep receives these just as messages. The rep orders the patient explainer and sets up an engaged meeting to talk about the samples request, to get to know this new doctor and to collect the signature for the request. So that's MyVeeva for Doctors. Making it easier for doctors and allowing you to provide great customer service.

Thank you, Courtney. Really great demo. And hopefully, that gives you a good sense of what we're trying to accomplish with MyVeeva for Doctors. Making it really easy for doctors to connect with life sciences companies in a new and compliant way. Let me give you a short update on where we are in the market with MyVeeva for Doctors. We previewed it at our Commercial Summit back in June. And today, I am pleased to announce that we have 4 customers live; 3 top 20 pharmaceutical companies and 1 emerging biotech, it's in the rare disease space. Shout out to the product team for such great digital innovation and really strong execution in less than 5 months. I'm super excited about the potential that we have with MyVeeva for Doctors, the potential to transform how digital is done in the life sciences industry. So let me wrap up by talking about some of our key focused areas in commercial. First is moving the industry to digital. We've made a lot of progress there over the last year and putting that foundation in place with core CRM, but all of the core pieces that come together in Commercial Cloud. Engagement, all of the data and analytics and the content that we talked about coming together to enable our customers, but also becoming a strategic partner to the industry. Our customers are relying more and more on us to help them get to digital faster and with excellence. And then finally, to continue to innovate. Hopefully, you heard today some of the innovation that we're focused on around Data Cloud and MyVeeva for Doctors in many new areas to come. So with that, I'd like to turn it over to our CFO, Brent Bowman, and Brent is going to give you a short financial update.

Thank you, Paul. I've been at Veeva nearly 5 months now, and I'm really excited to be part of the team. I've been incredibly impressed by the level of product innovation, the focus on customer success and the extraordinary talent and humility that has driven Veeva's success, as I look forward to the enormous opportunity still in front of us. It's clear we have the right vision, products and disciplined execution to reach our $3 billion revenue target in 2025 with room to grow. So why do I feel so confident? Over the next few minutes, I'll talk mostly about our history of strong execution, the robust growth drivers we have in front of us and our durable operating model that will enable us to meet our 2025 goals and beyond. Veeva has a consistent history of meeting and exceeding its goals through a focused and disciplined execution model. This disciplined execution and focus on customer success has enabled a unique combination of growth and profitability from a very early stage. Our go-forward focus is to drive strong growth over the long term, while maintaining a healthy level of profitability. As you may know, say longer-term financial targets is not new for Veeva. In the fall of 2015, Veeva set a revenue run rate target of $1 billion by the end of calendar year '20. This target has successfully achieved 6 quarters early with a higher operating margin. This was accomplished through disciplined execution, product innovation and a laser focus on customer success. A year ago, we established calendar year '25 targets of $3 billion in revenue and operating margin of 35% plus. Today, we are reiterating these targets. We are confident in our ability to accomplish these goals given the product portfolio that we have created and the referenceable base of successful customers that we've built. Through our continuous product innovation and focus on customer success, we have a clear path to our $3 billion revenue target and beyond. Let's take a look at the growth drivers we are most excited about. Veeva's market opportunity has continuously expanded through a focus on underserved markets. Most of our products are in an early stage of market adoption. We have a lot of white space, which sets up a long runway of potential growth. A large majority of our growth comes from selling more to existing customers. Our focus on customer success is resulting in this increased adoption. This enables us to form deep customer relationships and provide visibility into future growth. And finally, Veeva at its heart is an innovation machine with more than 30 product offerings. Over time, we will continue to build new products and enter new markets, thereby creating additional white space. Back in 2007, when Veeva first started as a company, it was focused on Pharma CRM, a TAM of about $0.5 billion. By the time Veeva went public in 2013, we had introduced Vault for life sciences and expanded our commercial offering. Since our IPO in 2013, we have more than doubled our TAM with the continuous build-out of our Vault applications, our move into industries other than life sciences, our entry into patient data and analytics and most recently, the addition of Data Cloud. We now have a TAM of $12 billion plus. Veeva's customer focus and continuous product innovation has resulted in a growing market opportunity. As you can see, Veeva has a long runway ahead with $10.5 billion plus of white space and the product portfolio and trusted customer relationships to address it. Continuous innovation in our product portfolio is fueling the revenue of today, our $3 billion target and growth beyond 2025. This chart highlights where each product sits in our product portfolio maturity curve. Though this will vary from product to product, on average, it takes about 3 to 4 years to get through the innovation and early adopter phase, where we tune our products to ensure customer success. Meaningful market share and revenue generation through our reference selling model starts in the early majority phase and leadership position in the middle majority phase. This on average is between 5 and 10 years. As you can see, this is a long-term durable product portfolio where we have continuously planted the seeds for future growth. Vault adoption and new customer adds continues its strong growth. Through the first 6 months of fiscal year '21, we are on pace to add over 100 new customers and 400 new Vaults for the full year. The breadth of our Vault product portfolio and our focus on underserved targeted markets is the key to this growth. While looking at the average number of Vaults per customer, consider that most new customers start out slow with 1 or 2 Vaults and then expand over time as they gain success. Thus, new customer additions can make this metric a bit misleading and mask the true momentum of our installed base. We thought it'd be helpful to show the growth in customer adoption by cohort based on when they purchased their first Vault. As you can see, the average revenue at number of Vaults are growing by cohort. As early adopters gain success and expand their usage of Vault platform offerings, it is important to note these are significant projects for customers, and it takes time for them to migrate their legacy systems. Customer is seeing the benefits of a single integrated platform across their R&D needs. And even these customers have plenty of room to expand. Our Vault Suite contains over 20 applications today. We are excited about the significant opportunity to expand our footprint within our installed base. It's a similar story in Commercial Cloud, but with a more defined pattern. Historically, most customers have started with CRM and CLM. These days, Approved Email is joining that group and becoming more ubiquitous. That's what accounts for most of the 3. We have added a number of other products over the years, like Engage, Align, Events, OpenData, and we are excited about our opportunity for further adoption. One important thing to note, we are not yet counting Engage in this analysis as customers are using it as part of our free program through the end of December. We've seen a rapid adoption and uptake of that product. This is another way to see the growth in customer adoption. This chart shows the number of Commercial Cloud products by customer grouping. As you can see, nearly 50% of our customers have 4 or more of our commercial products. And we have a strong momentum of customers with 6 or more products. This is a testament to our product innovation and focus on customer success. We are very pleased with the durability and leverage in our operating model. Over the years, our subscription gross margin has steadily increased through 2 primary factors: revenue mix and product mix. First, our subscription revenue has historically grown faster than services revenue, which acts as a tailwind to overall gross margin. Second, on average, Vault products have a materially higher subscription gross margin relative to CRM and some of our other commercial products. This year, those 2 dynamics are still at work. The 2 acquisitions that we've completed towards end of last year were both dilutive to our overall gross margin. As you may be aware, we have reduced spending due to COVID, reduced travel and in-person events, which you can see in our sales and marketing spend as a percentage of revenue. We are laser-focused on ensuring we have the right level of investments to address our market opportunity and reference selling model. Lastly, The effectiveness of the Vault platform allows for material innovation and new product introductions while still only spinning in the mid-teens in R&D. Our operating model enables investment for long-term growth. When looking at our 2025 op margin target of 35% plus, we wanted to share some color about what that represents. In 5 years, our operating margin could be much higher than that or could be very close to 35%. Where that ultimately lands in 2025 will be determined by the strategic decisions that we make in the coming years. And we wanted the flexibility to make the right calls that are best for customer success and growth beyond 2025. There are some structural tailwinds in our operating model that will tend to drive margins higher over time. The revenue and product mix dynamics that I just discussed will continue to increase gross margins. Also, the innovation and effectiveness of our Vault platform combined with the broader product adoption by our customers is resulting in R&D cost leverage. And our sales and marketing and G&A lines are already operating in a highly efficient manner. However, those tailwinds will be offset by investments for future growth. We will continue hiring aggressively to build new products and enter new markets. We'll make other types of investments like building out additional data supplier relationships to support our Data Cloud product. And along the way, acquisitions could play a role, which could be dilutive to margins in the short run. We are extremely pleased with the optionality our operating model provides for future growth. In closing, I'd like to leave you with a few key takeaways. Veeva's execution engine has never been stronger, with our relentless focus on innovation and customer success driving our consistent financial outperformance. We have continuously identified underserved markets and have more than doubled our TAM since our IPO in 2013. We are currently serving only about 10% of our market opportunity. We have a lot of white space in front of us. A significant portion of our revenue growth has come from expanding customer adoption of our products. We see the momentum and the deepening of our customer relationships. And again, we have a lot of white space in front of us. And lastly, we are investing in innovation and customer success. We have and will continue planning the seeds to achieve our 2025 targets of $3 billion and we have plenty of room for growth beyond. Now I'd like to hand this back to Paul.

So I have the great pleasure of introducing our fireside chat guest, Tom Harvey. Tom is the Senior Vice President of IT and CIO of Alkermes. Tom spent the last 15 years at Alkermes, and he now oversees all of global IT at the company. He's also part of the executive management committee. Now I've known Tom for much of the last 10 years, and I know that not only has he dedicated his professional life for life sciences and to helping people, he is also passionate and dedicated much of his personal life to charitable causes. Welcome, Tom. Really great to have you here today. Our financial community loves to hear directly from customers. So very much appreciate you taking the time to be with us today.

Absolutely, Paul. I appreciate the opportunity to be here.

Excellent. All right. So I'm pretty sure not everybody knows who Alkermes is. And certainly, they don't know who you are, but I'd love to get them to learn a little bit about you and your company. Can you give us a brief overview of Alkermes as a company and also your role?

Yes, I'm happy to do that. Alkermes is a biopharmaceutical company that works to develop medicines for people that are living with serious mental illness, substance use disorder and cancer. And we've currently got 2 marketed products, one for schizophrenia and the other for substance use disorder, both for alcohol and opioid and then a pipeline of products that are -- we're hoping to be able to meet additional needs for patients that have bipolar disorder in schizophrenia, but neurodegenerative disorders and cancer as well. I'm the head of IT and the CIO at Alkermes has been at Alkermes for 15 years, which is pretty hard to believe. So I'm responsible for really all of the systems across the global landscape, whether that be R&D, our manufacturing operations, commercial operations or our home office and corporate.

So Tom, you've been in Alkermes for 15 years. You've also been in the industry as a technology leader for most of your career. When you add all that up, how do you think about your technology strategy in order to enable Alkermes, the business?

We touch our strategy pretty simple, and that's really to be able to align with the business. So our overarching mission is to be able to help lead the business in identifying, leveraging transformative technologies that will accelerate our corporate mission and strategy. Because we know at the end of the day, that's ultimately going to help people living with some of the most complex health challenges of our time. So we look at using IT to be able to accelerate our pipeline development and clinical programs. We use IT to optimize our manufacturing strategies and global supplies and certainly with the help of Veeva and in all of those areas, but kind of initially really around our commercial effectiveness for both existing and planned products that we're marketing. But in general, at the end of the day, we're trying to enable our corporate values, vision and mission, with IT strategy that ultimately helps patients and helps patients [ events ].

Obviously, a big part of that is supporting that pipeline that you have. Can you take a moment and just talk a little bit as you look over the next couple of years? Give a little color on your pipeline and what that means in terms of your priorities and your focus?

Sure. Well, some of our initial focus is to make sure that we continue to work in this new reality and the challenges that COVID has brought to sort of everyone in society, but particularly our vulnerable patients that need access to our medications. And when we look at the pipeline, we're really excited about an upcoming decision for approval for our ALKS 3831 medication and hopeful subsequent launch next year, where we're looking at being able to bring a new treatment for patients that are living with bipolar disorder in schizophrenia by taking a drug that -- with the efficacy of olanzapine that's in place today and then looking for a new formulation that to mitigate some of the weight gain associated with it. So that's really exciting and near term for us. But we don't look very far out and see our oncology program that has some really exciting news in our ALKS 4230 program. So ALKS 4230 was recently showcased by our team at ESMO, a major European medical meeting, where they were able to show some really great successes we're having in clinical trials with patients with a variety of advanced solid tumors, both monotherapy and in combination. So we look at that as well as other assets that we've brought on in recent times, and we know that Alkermes is here to make a big difference for patients' lives in the future.

So Tom super exciting pipeline. Exciting commercialization opportunities. We're rooting for you. Can you talk a little bit about your Veeva footprint? And you've been a Veeva customer for a long, long time, I think back since 2009. Can you talk about your footprint and what that looks like today?

Yes. It's pretty amazing to think about the relationship we've had with Veeva for the past 12 years. We were initially looking for a CRM solution for our newly acquired VIVITROL sales team. And with Veeva's Health, we were able to pull off an accelerated implementation in less than 2 months and work with just an incredible group of folks at the time from Veeva. It's interesting that a number of the folks that were on our implementation team, which only had -- I don't have a number of people from Veeva, but if I think about the 3 to 5 major folks on our team back then, they've actually grown in be really large leaders with great scope within Veeva, and that's been exciting to see. So we started with commercial on the CRM side. We were an early adopter of the Vault PromoMats product within our regulatory team. Our medical team uses MedComms, and the commercial team also uses Veeva Engage and has really made great strides with that over the past 6 to 9 months with COVID in terms of a way to go in and continue to have really positive and meaningful interactions with our health care providers. Other things that we're using Veeva on our regulatory and clinical side, we use the eTMF for electronic trial master file. the RIMS suite, which is the regulatory information management suite. Our quality team relies really heavily on QualityDocs for all of our compliance And then our legal team is actually using a legacy version of the Vault platform product to house our legal contracts. So we've got a pretty wide offering there.

So first, thanks for training all with the Veeva leaders. We appreciate that back in the early days. You've expanded obviously quite significantly. I think you mentioned a number of products, I think have over 10. Can you maybe walk people through some thinking around how that journey has helped enable your business over the years?

Sure. We've always been able to rely on Veeva as a really good partner. And as Veeva has expanded the offerings over the past decade, we've watched closely and kind of considered Veeva solutions when we're going to try to automate new manual business processes. So if there's a solution that's not in place and we get to a size and scale where we need to automate that, Veeva's come forward with solutions in the past that made a lot of sense for us actually, that PromoMats product that we talked about a minute ago was key to that in terms of helping us manage and keep compliant our promotional materials to meet kind of all the regulatory needs as well as our internal workflows and improvements that we could get there. We also look to Veeva when we're looking to expand functionality of current products. So we mentioned going live on CRM 12 years ago or so. Since then, that CRM suite looks very, very different than what it did at that point. So as you've continued to innovate and offer functionality enhancements, we've been able to take advantage of many of those. And then when we go to replace any other solution, if we realize that we're kind of end of life with a certain technology or we're not particularly happy with the solution in one of our areas, we've often been able to look at Veeva and see that you have a solution like that QualityDocs offering that we talked about one day 1 as well.

Tom, really, really helpful. I think what might be interesting for this audience, you mentioned a number of different products across R&D, across commercial. Can you maybe give 1 specific example, 1 example on commercial, 1 example on R&D of how Vault has helped you in the R&D space in commercial cloud in the commercial side?

Yes, I kind of touched on a couple of them earlier, but I think role-specific on the regulatory information management program, that RIM. We saw that our regulatory process has really gained deep efficiencies and significant improvements as we automated those processes. We were able to minimize many of the delays that we had where we were looking at approvers being able to sign paper documents with a wet signature, and it sometimes could take weeks as people kind of walked around as these big forms and fax them back and forth or e-mail them back and forth in terms of working through that. So now with RIM, we basically, with a click of a button, can allow approvers to review and approve almost anywhere and even from a mobile device. So it's really helped our internal efficiencies, I think, in that regulatory side. On the commercial side, I think the most recent big win was using Veeva Engage where we had to replace some of those face-to-face meetings. And where we couldn't be able to call on health care providers and we weren't able to visit the facilities, Veeva allowed us to have really effective and compliant virtual meetings with those folks. And I'm confident that with the great experience that we've had already in those types of engagements, not only did we ramp up quickly with Veeva's Health, I think it's going to change the way we do business going forward.

And now that we're on that -- the topic of digital, can you talk a little bit about -- we talk about helping move the industry to digital. We spent a lot of time referencing that concept today. Can you talk about what Veeva has done to help get you to digital faster? And what does that mean from a customer's perspective?

Well, I think it's really important for life sciences customers because we tended to lag in that move to digital. And sometimes, we blame it on the regulators or being able to meet some of our computer system validation requirements from the FDA and other authorities around the world that do similar oversight for the industry. But Veeva was really kind of the first with its CRM product to push truly into cloud, to a full cloud solution that wasn't just sort of a tiny little one-off for us. So most companies were really struggling with figuring out how to do cloud. We feared being able to create enough -- demonstrate enough validation and consistency with those new tools and new technologies. So Veeva came along and really offered a platform-based tool that was really strong in the industry that demonstrated strong software quality and compliance that allowed us to be able to adopt cloud. So I think that was one of the first things that happened. And then certainly the Vault product line, I don't think any of us could have imagined exactly how far that's come. As I mentioned, we were a very early adopter with the first product on Vault, which was the PromoMats for promotional materials within regulatory. And if you look at what that's done to grow into multiple offerings that we were able to replace a lot of old legacy software products that allowed a small company to really ramp up and have industry-leading capabilities quickly, but it also was scaled to a point that the big pharma was able to get involved pretty soon after your releases in terms of really joining that journey. So I think it really has moved the industry very substantially in a way that you guys have looked to being best-of-breed solutions along really tight integrations to be able to go across multiple business lines. So when I look at that and I compare it to what we were using 5 and 8 and 20 years ago with a lot of legacy applications that were really closed, really expensive, hard to integrate and hard to maintain because they required a big capital outlay and a big outlay of resources to be able to do these big forklift upgrades every few years, it really has changed the way that we do business.

Tom, I love, it's great hearing that from a customer perspective. We spent a lot of time and energy in trying to help move the industry to digital, but also the idea of eliminating a lot of those integrations, all that pain, all that hassle, the upgrades. The idea of bringing multiple applications together on Vault platform as one example. So here, we do bring it to life, certainly makes us proud.

Well, some of the things that you guys -- that you really did, and I kind of mentioned software quality before, but I don't know that I can really convey to you how important that is for our industry. So if the software doesn't work, we can't wait for those dot releases and hot fixes in processes that are heavily regulated and that we rely on to be able to ensure that our medicines are efficacious and that we are getting the right medications to the right patients in the right time frame in terms of being able to meet all those standards. So the fact that it just works and when you do an upgrade,it rarely breaks, is really huge for our industry. And I think that's something that we really struggled with upgrades in the past.

Well, it's a super important industry. So we know how critical it is. We take our responsibility seriously.to help deliver software and solutions and services that help work. So I love hearing that. Maybe related to that is one final concept. We also talk in aspire to be the industry's -- one of the industry's most strategic partners. It's one of the aspirations that we have. And when we talk about that, we talk about mining data, software, the data and with services, we want to be the industry's most strategic partner. For you, what does that mean to you? What do you look for in a strategic partner to your business?

Well, one of them has to do, I think, again, back to the general life sciences industry. We really have an objective to move quickly. And it -- the drug development process is slow by nature of the regulatory environment. So when we have a tool that can help us, and we have a partner that can help us move faster through that process and that, that way, we're able to deliver outcomes to patients and the communities at large faster, that's really important. So knowing that Veeva's on our side to kind of minimize the red tape and help work through those internal processes that kind of get slowed down in that regulatory environment. That's really important. And It's great that we can work together to figure out how we improve and anticipate the needs of what the organization is in the future and how to get through that. Second thing that comes to mind is just a partner in Veeva from a strategic standpoint that's dependable, that values compliance and ultimately, is trustworthy from our perspective. So I think having a partner that can listen to our feedback, can act with us to help us solve complex challenges and really look at a relationship that's a lot more than transactional, it really helps. And I think together, we actually end up using each other almost as trusted advisers in a way that we extend our external teams to be able to have kind of the perspective of each other as we move forward. And Veeva has just been there from that standpoint. And that's how we've typically viewed our relationship over these past 12 years. You mentioned and as I gave some of those examples, we use Veeva technology pretty broadly. We've gone to you with questions. We've begged for some changes at times. And you've always listened or almost always listened. But like us, I know you're looking for ways to improve and how you find the right next thing for your stakeholders. And it's been great to be what I feel like is, as your strategic partner, as you are our strategic partner in this journey together.

Tom, I was going to say the same, use the same words. We -- you're clearly a Veeva customer. You've been a customer for a long time. But we do think of you as a partner and through the journey, we like to think as of all of our customers as partners in the journey. We learn together. You push us, and we try to continue to execute and innovate. So thanks for recognizing that. And thanks for the very long partnership that you've had with Veeva. We very much appreciate that.

Well, we look forward to the next 12 years, too.

Excellent. I'm looking forward to it as well. And also thanks to you and the Alkermes team for all you guys are doing. You guys are tackling some really big public health problems and public health challenges. So best of luck with some of the upcoming approvals that are potential candidates for you.

Great. We appreciate it. Thanks a lot, Paul.

Tom, great to have you. Thanks again. Take care.

That was great to hear directly from Tom at Alkermes. Let me summarize the main points from today. First, we've been executing consistently due to our operating model. Second, 2020 has been a year of strong innovation for Veeva. And due to that innovation and consistent execution, we're becoming a very strategic partner to the industry. And finally, we're still in the early days of the industry cloud for life sciences with plenty of room to grow. Taken together, this sets up Veeva very well for 2025 and beyond. Thank you, and we will now turn to questions.

All right. Thank you all. As a reminder, if you do have questions, please chat them to us in the webcast or you can send them via e-mail at the address [email protected]. First question, Peter, is for you. You mentioned planting seeds for longer-term growth. Which ones are you most excited about as you contemplate the $3 billion goal for 2025 and growth beyond?

Rick, I get excited about all the seeds. And all those seeds are good seeds. But if you look in terms of magnitude, there's probably 3 that stand out. data cloud, which we launched this year, that's a big undertaking and fundamentally for Veeva. Performance data at the country level, that would keep us busy for a long time. That can be very transformative for Veeva and the industry. So that's a big one. The idea of clinical network, too, of the free software for the clinical research sites at which there are many. There are many thousands around the world and free software for the patients and then charging for the usage of that to enable us to get to the paperless and patient-centric. That's something that's never been attempted before. So that's really big. And then the third would be MyVeeva, directly allowing our customers to connect with their customers through a common framework that Veeva has. It's just in the super, super early days. You can imagine where that type of thing could go and the use cases. If we can play our part to connect the patients and the doctors and the providers of medical technology, that's actually -- that's a big deal. Now we're at the very early stage here, but that's how I'm so excited. We've never launched 3 things like that all in 1 year before. We've never done that. Now that just means we have a lot of work to do to get all those stuff done also.

Thanks for that, Peter. The second question is for Paul, and this is around MyVeeva. And Paul, there's sort of 2 questions here that I'm going to group together. So the first is can you share a bit of color on the monetization model for MyVeeva for doctors? And second question is there could be some confusion about how MyVeeva for doctors relates or is adjacent to other telemedicine type of products. Could you also talk a bit about how those 2 are different and how, if at all, they're related?

Yes. Sure, Rick. So on the first one on monetization, first, I'm really proud and pleased at the speed that the teams move with MyVeeva. Just a couple of short months ago, MyVeeva was an idea and something we talked about with customers and now it's a reality. Just last week, we had our first -- some of our first early customers going live in the field. And -- but having said that, it's super exciting, but it's also a reminder that we're very, very early with MyVeeva. The companies that have gone live in the U.S. market, they're very focused sales teams. So although a number of them are large companies, large top 20 companies, we have 1 smaller emerging biotech. Very focused sales teams, very early days. We're learning a lot about the product. And we're learning a lot about what works out in the field. And we're also learning about the go-to-market and the licensing and how that whole thing works. Now it is too early to quantify the size of it. But we are going to go to market differently. We're going to go to market focused on per brand. So this will be what brands will buy into MyVeeva. And for that, they'll get access to the capabilities in MyVeeva and it'll also be per country. So per brand and per country, a little bit of a different selling model, but a bit too early to talk about the actual -- the specifics on the -- and the sizing. Your second question, Rick, was about, I guess, the telemedicine companies and systems and also related systems like EHRs and EMRs. My view is different than those. It's different, and I see it as complementary. The telemedicine systems are obviously the ones that are used by the doctors and the patients creating that virtual point of care and the EHR and EMR systems are the ones that really they use to manage the practice and also surface a lot of information during the point of care, and MyVeeva is not a point-of-care application, but it's something that can help doctors get the information they need when they need it from the right pharmaceutical company. So I think ultimately, it will significantly help with patient care, with patient outcomes, but it's certainly not the patient care system. I view it as complementary. And I can see over the longer term those things becoming a little bit more connected. But again, we're still early. But I guess the takeaway there is it is different and complementary.

Great. Thank you, Paul. All right. So yes, a couple of questions around Data Cloud. Peter, so starting with you, what types of data sources or partnerships do we need to get the Data Cloud to a position where it can create network effects and ultimately become an industry standard? And a couple of follow-up to that is how far along are we on that path?

Thanks for Data Cloud and data sources. That's a key part of Data Cloud. I guess There's really a couple of key parts. There's the data sources and then there's the delivery, which is also really important in the designing of the products. So to step back, we're starting this -- we started this from scratch. We started with the Crossix data platform, largely had many of the data sources that we already need -- already needed. And they -- that's -- the actual data sources, we'll keep that private. But our approach is to get the data actually redundantly from multiple sources along the value chain. And there's many sources of data, all the way from prescription data to the PBM switch, to the claims data. It's -- there's a more -- and many others. So our approach is to get the data from multiple sources, triangulate that. We're quite far along on that. We're very happy with it. And then it's what do you do with that data. What sense do you make with it? And how well are you able to match it up on the patient and provider layer from multiple sources? And then you have to deliver it, and that's where we're delivering with, not just data, but software as well. High level, again, Rick, we're -- and everybody on the phone, we're not copying anything here. Industry has known a way to do this sales data that kind of started from 30 years ago and really hasn't evolved that much. We're really changing it. It's equivalent of industries on mainframe. We're going right to cloud. So the adoption is going to be a bit slow because we'll have to change people and get them used to a new way of doing things. But data sources, I think we're pretty well set there.

Great. Thanks, Peter. Sticking on Data Cloud, we've had a couple of questions just on the $2 billion TAM that we've defined. Paul, could you just talk in a bit more depth on how we got to that number? What is included in that number in our -- of our TAM per day, Paul?

Yes, sure. I can give some color on the TAM. I mean, in general, the way we think about TAM is we like to look, particularly in markets where there may be some existing vendors. We like to look at the overall market and see what the revenue looks like in the existing marketplace. As Peter just highlighted, though, we're doing Data Cloud differently. So it's not enough. It's not sufficient just to look top-down at what existing vendors provide to the market because we're innovating because we're doing things differently. We have to think bottoms-up as well, and we have to use our best estimates, our best intuition about the products that we're going to deliver and the value that they'll bring. So the highest level is we look top-down and we look bottoms-up to triangulate what that TAM looks like. And so the $2 billion number includes the really -- the products that we've announced, the patient and the prescriber data sets in a more innovative way to the industry. And I would think of it as mostly data with some services as well.

Thanks, Paul. All right. So let's turn to our business that's focused outside of life sciences. Some questions here. So, Peter, as we contemplate the $100 million-plus revenue target for that business that you mentioned. To what extent are additional product launches sort of a part of that? Can you share any color on the road map for additional products that we might introduce via that team that's focused in industries outside of life sciences?

Yes. In terms of that $100 million-plus revenue target there in 2025 for outside of life sciences, important to remember that's for the CPG chemicals, cosmetics and the quality and the regulatory there. I would say there'll be small product expansions and maybe one significant one into the safety area, but that's what we're contemplating for that $100 million: quality, regulatory and safety.

Okay. Thanks, Peter. It makes sense. Brent, this one is probably for you. This is around our Engage product. Just as a reminder for the audience, our Veeva Engage product, we've been -- it is part of the commercial cloud. We've been giving that away for free as a way to help our customers through the pandemic. That free period ends at the end of December. The question is, Brent, if Engage were monetized today, how material of a revenue line would that be? And kind of what are we thinking in terms of revenue conversion as we look towards next year?

Yes, sure. Happy to answer that. So we're really happy with the Engage adoption that we've had to date through the free period and our ability to help the life science industry in a challenging time. We do expect a majority of those customers to continue beyond the free trial period. So we're very excited about that. And that has been factored into the guidance that we previously provided for the full fiscal year '21. So that was already incorporated, that assumption. So all in all, very happy with the Engage product and the adoption.

Thanks, Brent. Sort of along those lines, Paul, this one's probably for you. With our customers kind of turning towards digital more and more, especially on the commercial side with industry dynamics, such as they are with the pandemic, to what extent do we expect our customers to have reductions in their pharma rep headcount over time?

Yes. I think there's a couple of factors that are, I would say, a wide variety of factors that play into how companies think about how large their field teams need to be. Certainly, access is one of them. We've seen access because of COVID decrease and physical access being able to get into an office for example, it's starting to trend back upwards. And I think over time, it will start to return to somewhat that's normal. So access is a driver. But also things like you referenced getting to digital. It -- what -- I think I've seen our companies -- our customers recognize and appreciate in what's played out over the last several months is that they're seeing the benefits of digital. Doctors are using it. They're excited about it. They're spending more time on it. They're happy to engage in a digital way. Not all, but most. And they're certainly getting value there. So I think the opportunity that digital presents will create efficiencies. It will help our customers be more effective. They'll be able to do more with less. The question then is, what do they do with those efficiency gains? Do they reach further into the call cycle and call on more customers? Or do they have rep reductions? I think overall, I think it's likely that we will see some reductions maybe on the order of -- in the neighborhood of, let's say, 10% over time. But I -- and I think that's a testament to some of the efficiencies of digital. At Veeva, we want to embrace that. We want to be part of that, and we want to drive that efficiency in the industry. And that's why we're so focused on innovating in Engage and creating new innovation like MyVeeva for doctors. So a key part of our strategy is to help the industry become more efficient. And as the model changes, as they -- if there are rep reductions, then we're part of that solution.

Makes sense, Paul. Let's kind of stick on this notion of customers moving to a more digital way of working. As they do that and as this work environment that we've all been operating in with the COVID pandemic and the subsequent lockdowns and whatnot, are we seeing an incremental tailwind in customer demand? And if so, where and how is that manifesting itself. Peter, this one might be best for you.

I wouldn't necessarily call it a -- the pandemic tailwind. I think it's actually creating a long-term tailwind and confidence, though, right? We really -- make no mistake, the life sciences industry has navigated the pandemic well, but it's been stressful, right? Life sciences supply chains are very complex. Access to doctors, both on the clinical and the commercial side, reduced. So that's -- and not to mention all the work in the vaccines and the diagnostics and the therapeutics related to COVID-19. So it's been very stressful, but life sciences industry has navigated it well. And Veeva has played a part on that as well. Many of them use Veeva systems and they've continued to work well, and we innovated. We've brought out Data Cloud and MyVeeva. So we've got a bit of a tailwind in confidence. I think the industry is a little more confident with Veeva, and we're a little more confident in our position. But at the individual level, a revenue level, I wouldn't call it a tailwind. Some of our projects with our customers got delayed because they had other priorities due to COVID. Now sometimes those other priorities actually gave us a boost on some projects. Some of our projects, they were related to COVID and they went faster. So all in all, I would call it, not a tailwind in terms of revenue, but a tailwind in terms of confidence.

Got it. Thanks, Peter. So turning to our clinical business. We mentioned a second top 20 pharma customer on our clinical data management products on our last earnings call. Just wondering if we've seen any changes yet to the competitive environment there. since the -- our biggest competitor, Medidata, was acquired last year.

Sure. So Rick, this is Jim. I can take that. So we're not seeing a tremendous change in terms of the competitive landscape. As we always do here at Veeva. We'd like to say we're running our own race. And in this clinical data area, we just think we have a different value proposition, and we're starting to see that pay dividends in terms of customer interest, customer adoption and the CDMS application being used across all types of trials. So for us, it's really about delivering a better capability with EDC. I highlighted some of those in the presentation earlier, but also bring innovation, right, with Veeva stats now coming into the fray with the clinical data space. We think we're offering something that's going to be better and different. And again, we're starting to see that buy in from the industry.

Great. Thank you, Jim. So Peter, let's turn to our recent proposal to convert Veeva into a public benefit corporation or PBC. A couple of questions on this. So Let's start with the first one. Can you just share any early customer feedback that we've had in the wake of this announcement?

Yes, we're really excited about that in PBC. It's aligning our values to our charter. It may sound like a small thing. It's an important thing for Veeva and our employees, recognizing our investors have been pretty enthusiastic. Customers are also enthusiastic. And I say, I think, appreciative of the long-term approach, right? It doesn't affect their day-to-day because it doesn't affect how we operate, but it just makes them feel comfortable that, "Okay, look, 10, 20, 30 years, we are still going to be Veeva." So pretty enthusiastic on the long term, but doesn't affect the day-to-day.

Makes sense, Peter. Kind of a follow-up question on this topic is given sort of the way that we've framed our mission as a company, is there any thought to changing our pricing and specifically to use the strategy of lower prices as a way to drive further product adoption while still maintaining our margin targets?

Yes. Overall, no changes to any kind of an operating model or things that we do at Veeva, right? We're doing what we're doing and then this is just aligning our charter for the long term. So pricing has always had a good philosophy there. We don't -- we'd shoot for product excellence and part of that is setting an appropriate price. And then we don't raise the prices even when inflation goes up. So we try to get more efficient. So no changes in pricing there.

Great. And then kind of the -- maybe the final point on this topic. As our customers go deeper and deeper with Veeva as they rely on us for more and more of their critical functions with our software, our data, our people. I guess a couple of things. How are we keeping pace with our hiring in order to support that? #1. And #2, is there ever a concern that the level of spend within customers reaches a level that's too high or that where customers would be worried spending that much money with us or and trusting us to that many of their systems?

In terms of hiring, yes, that's always, like, that's the magic. How fast can you bring in the best people and assign them in the right places to the right market? So that's always going to be hard. And I think it's the same as it's always been for Veeva. I would say we're getting better known, and we're getting a bit more inflow. So I'm really happy with the people that are coming into the Veeva. So it's same old stuff there, but I'm encouraged. We're getting more visible. I think PBC actually helps a little bit and just we're on a roll. In terms of the customers, overall, when they adopt more Veeva, they get more value. It may reduce some of their operating costs in IT. That's true. But the way the customer, in general, will look at it over time is, "Am I getting value for that?" When we look at IT spend, you could actually eliminate it, totally your IT spend and just go back to paper. So you'd save money in IT. You put your accounting on paper. But nobody does that because it doesn't provide value for the business. So it's quite simple. Customers adopt more from Veeva when they can get more benefit from Veeva in -- by adopting more. I haven't seen the customers say, "Well, we don't trust Veeva. So we don't want to spend much with Veeva. We'll sprinkle it around with different vendors." That's not -- life science is a competitive industry. They're looking for a competitive advantage, get their medicines out to patients. They trust Veeva and also with the PBC, I think that really puts it right in our legal charter that they can trust Veeva because our Board of Directors, if this passes, will have the legal duty to watch out for employees and customers as well as shareholders. And that's new.

Great. Thank you, Peter. So Brent, let's turn to you. We've gotten a couple of questions around our 2025 targets and sort of what are some of the components at the product level of how we get there or what will be driving growth. So can you just talk to when we consider newer products like, let's say, Nitro, Data Cloud, how much are we expecting from those products to get to the $3 billion sort of what are -- and maybe more broadly, what are kind of the biggest drivers of growth as we look out, say, 5 years from now?

Yes. Certainly happy to answer. So if you look out between now and 2025, the primary drivers will continue to be our commercial products, CRM and our add-ons. But if you look at the R&D space, as we move into higher growth areas like CDMS will be an area that will be more meaningful as we get to 2025. Safety will be another area that will be more meaningful when we get to 2025. And as Peter mentioned earlier, outside life sciences will become more meaningful. Nitro and Andi will be not a significant contributor most likely between now and 2025. And then if you look out beyond 2025, Data Cloud and the clinical network are clearly areas that are going to have a really great opportunity for growth beyond.

Great. Thank you, Brent. Let's bring it back to MyVeeva for doctors. This is a good question. So Paul, This could be a pretty powerful tool in the industry that really helps life sciences connect with the doctors that they're trying to reach. But to really create that network effect, you need to have the doctors going to the product. So I guess the question is how do we "sell" it to the docs? Or how do we drive awareness with the doctors to make that happen?

Yes. That's a good question. And you -- the premise of the question is right in that there is a network effect that will happen over time, and that becomes really -- can become very powerful and quite valuable. But I think even before you get to the network effect, the way we're thinking about MyVeeva is there is value just by having a small number of people connected on the application. So just when there's -- think about it in the very early days, which is where we are today, when, let's say, there's 1 sales rep and 1 doctor, when they connect on MyVeeva, they're able to create value together. They're able to have a compliant conversation. The doctor is able to request materials. They're able to do things that they wouldn't be able to do without MyVeeva. So the path to get there is to create value by having capabilities that deliver something really interesting and really useful without any network effect at all, without the benefit of any network effect. And by doing things like that, we'll be able to build up that community over time. And this is a long journey. This is going to take -- it will take a lot of time to get there. The other thing that I think is really interesting about MyVeeva and different is that it's not just a digital website. This is about creating real connections between people. That LinkedIn-style model, where a sales rep connects with the doctor because they have a relationship. They want to connect. They want to be able to do things together. And that is -- that will be the primary channel. The reason some, like, a doctor will download MyVeeva for doctors and use it is because they have a relationship. That will be the primary driver. We don't -- our model is not to go build up a huge channel of doctor community by promoting to them and then try to sell that back to pharma. That's not the model we're taking. We want to deliver real value to reps and doctors and pharma companies, and we'll build that network over time.

Rick, if I could break in, I got some late-breaking news here. I could actually talk about the first messages that were sent across MyVeeva for Dr. App, if that's all right.

Yes. Please dive in.

The very first one. It's like -- what was the first thing on the telephone, right? The very first one was from the rep, "Hello?" From the doctor, "Hello. It worked! Thanks for connecting." So that's -- it's the equivalent of the Hello World. But I just saw 1 recently and that is more illustrative. I'll just read it. "Hi, Carol. I'm starting my referrals and need the payer grid. Can you send it to me? Thank you." That was from a doctor. From the rep, "Here's the payer grid. You can favorite this link and reference at any time you need and a little bit later. Did you receive the payer grid? Do you have any more questions?" And then, right away, "Got it. Thank you. No questions right now." So that's real value. The payer grid means, hey, what is -- with this particular drug from this particular company, what is the reimbursement status with the different payers? And the doctor needs to know that as it relates to their patients. So -- and that link that was sent, that was part of the approved content that was put in MyVeeva. So the rep didn't have to type that out at all. Boom! Sent it to the client. So that's just a little glimpse into what MyVeeva is. Pretty exciting, but pretty early.

Great. Thanks, Peter. I love that real-time update. Brent, here's one for you. So you mentioned that acquisitions could play a role as we contemplate our margin target of 35% plus in calendar '25. Does the -- does our $3 billion revenue target also includes some assumption for M&A along the way?

Yes, sure. I'm just happy to answer. So we're very happy with the product portfolio we have, and we believe that, that gives us a really strong chance, probability in our increased confidence to hit the $3 billion. So no. No meaningful inorganic activity was assumed to hit $3 billion. I just think it was -- it's important to note that if there were to be inorganic activity because you're always kicking the tires with our operating model, it would likely be dilutive in the near term. But to answer the question in short, $3 billion, that's just our good product portfolio driving in our great execution to that, supporting the $3 billion.

Perfect. Perfect. That's [ great ]. Let's see. So Peter, a question on our lawsuit with IQVIA. Just any update on the status of that? Is there -- what is our last thoughts on the date that, that goes to trial? Any other color that you can provide there?

Yes. We have our antitrust lawsuit against IQVIA. Just to briefly recap, IQVIA is a leading provider of this performance data. Now we're bringing out our competitor in Data Cloud. But IQVIA has entrenched basically a monopoly there. A lot of that data they don't allow to be put in our newer software and that harms customers, harms patients overall. It's really a despicable thing to do actually. So we filed our antitrust lawsuit quite a few years ago. And unfortunately, pandemic. One of the things that's done is it's really slowed down the courts. So at this time, we expect it to go to trial, it's a jury trial, expected to go to trial at the end of 2022. So that's a couple of years from now. And courts have been really impacted due to a number of things. And certainly, the pandemic not helping. But we have 2 strategies there. One is to outcompete, outinnovate in Data Cloud. The other one is to take the long-term view and fix this data monopoly issue legally for the industry, and we're confident in our case.

Great. Thanks, Peter. Maybe sticking on the topic of data for a second. There's a question on data protection laws. So for example, the CCPA in California. And just generally, is it becoming tougher, harder, more expensive to obtain certain types of data like patient data? Can you just -- can you comment on that at all, Peter?

Yes. I'll take that one. Certainly, it's something we have our eye on. And in general, the high-level answer is no, not for us, not becoming more complicated because well, there's many reasons. Patient data is anonymized. So that's not covered on that. That's anonymized data. And then the doctor data, that's -- most of that is in the public domain, and there -- that's not a true, true consumer in the way you would think of consumer. So this is certainly a thing that Facebook and Google and others have to really, really focus on for us because we're more of a B2B in what we do and also because already, wow, when you're talking about patient data, that's been under intense scrutiny for many years. So it's really not an extra -- not a significant extra burden on Veeva.

Okay. Thanks, Peter. Paul, this one is probably for you. So in reference, I think, to the stats that we showed around customer adoption of products in the commercial cloud. The question is really what's driving this? So is it CRM add-ons? The move to digital from COVID? Or is it more that we're seeing better traction in some of our more data-centric products? Paul, can you just sort of share some color around what's driving the additional adoption of more products in the Commercial Cloud?

Yes, it's a good one. And I would say it's more than just any one individual product. We certainly are having some impact from COVID just as companies need to become more efficient as they -- in terms of how they go to market. They need to streamline certain processes to help make them more digital. So the obvious one is Engage. We haven't seen much monetization of that yet because of the free Engage. But there are other related products to that, that where there's a benefit that we're seeing. So for example, additional uplift in approved e-mail, additional uplift in PromoMats as companies need to be more efficient about how they get content into those digital channels, additional uplift in strength in OpenData as companies need really high-quality data. It needs to be right. It needs to be fast and accurate. If you're going to engage digitally, you have to have the right customer reference data. So we're seeing strength. I would say, broadly with -- across a number of different products. I think the other thing we're seeing is some benefit in particularly the small customer segment, those companies that are commercializing for the first time and where 2 and 3 and 4 years ago, they may have started with Veeva CRM and 1 or 2 add-ons. They're starting with a number of products. They're tending to do more than they would ordinarily have done 3 or 4 years ago because they know that to become digital, you need to put a lot of these pieces together, and it's just better to do it right the first time and kind of go all in. So I would say those are the 2 big impacts, a little bit from COVID and then also smaller companies recognizing and appreciating maybe overall value of having a highly integrated commercial cloud.

Great. Thanks, Paul. So let's turn back to the clinical side of our business. There is a question that came up around how does our MyVeeva for patients product compared to the MyMedidata product? Peter, if you want to take that one?

Yes. I'm certainly not an expert on MyMedidata, but that's -- Medidata data is involved in that clinical trial space and MyMedidata was a way to manage a log-in approach across multiple Medidata interfaces. So It's not to do with doctors. So MyVeeva for doctors, totally different things ever -- as we've seen messages going back and forth. And then MyVeeva for patients from Veeva, that's really focused on it's a patient using the application. MyMedidata really initially not for the patient. Now they may be evolving that. I don't know. So MyMedidata is in the clinical area and have an initial scope. MyVeeva for Veeva spans both for doctors and for patients. So it's really a different thing.

Thanks, Peter. Sticking on MyVeeva for a second. Is -- what is the scope of the data that we plan to capture with the MyVeeva for patients products? It -- and as a follow-on, is are we looking to address the real-world evidence market with this product?

Let -- Rick, this is Peter. I'll take the real-world evidence one. And then, Jim, maybe if you can take the MyVeeva for Patients and the scope of the data. So real-world evidence, that that's more related to Data Cloud. And Data Cloud at first, we're focusing on the commercial use cases, not the real-world evidence. Real-world evidence has to do with data you collect from the EMR systems from the clinical systems. Now we'll get there over time for sure, the real-world evidence data. And it won't be that hard, actually. We have to get that clinical data, some of which we already have productionized it and add it to our data cloud. So not yet for real-world evidence, but coming. And then, Jim, if you could take the MyVeeva for Patients.

Sure. Sure, Peter. So on MyVeeva for Patients side, the scope of the data is really about 2 things. It's the experience of the patient in the trial. So it's the consenting process. They'll provide their consent digitally. They'll also be able to schedule appointments for visits, whether virtual or in person. They'll be able to provide their experience directly through an ePRO capability to the outcomes in the trial. And then the other bucket is eSource, which I mentioned earlier in the presentation. And this is where you're moving from that mode of EDC, which is where you're transcribing paper-collected clinical data into an EDC application and now moving directly to the source where the patient is having their data collected in real time into the application, which in that case will be used by the research site as they work with the patient. So it's really those 2 major buckets when you talk about MyVeeva for Patients.

Great. Thank you, Peter and Jim. And we're -- we probably only have time for a couple more questions here. A couple of questions around our outside life sciences business. So Let's see. I guess, the first one, and maybe, Peter, this is for you, is what are the sources of growth as we get to the $100 million in 2025? Is that more new logo additions or expansions within our current customers? What is kind of -- how do you view the sources of growth over the next several years?

Yes. So this is the growth for exactly that, both new logos and existing customer expansions. I would guess the probably slightly more would be towards a new logo in that time frame of 2025 and over $100 million. But we have a lot of headway in the 60 customers we have now. It's -- because our footprint is getting bigger. And it takes some -- these industries, they take time to adopt. These are critical systems that they're replacing. So it takes time.

Great. And then, Peter, kind of sticking in the same area. The question was asked, if you compare $100 million to say the $3 billion overall revenue target that we've set for 2025, it implies a relatively small percentage of our overall business, 3% if you just do the math. So the -- is there some sense that we're signaling more optimism on the broader opportunity within life sciences? And is that at all driven by the pandemic? Or just, I guess, you're thinking, Peter, on these 2 parts of our businesses, both the focus within life sciences and the focus outside of it.

Yes. A couple of things there. If we look at life sciences versus outside of life sciences, important to remember as we're defining outside of life sciences at this time, this is chemicals, CPG and cosmetics. So life sciences industry is much deeper. We've been at it much longer. We're much broader and it's a more technology-oriented industry in what it has to do. So I would say we have our major in the industry cloud for life sciences. But right now, we have our miner in outside of life sciences. Now if you look at that, the individual people inside of Veeva, some work in the outside of life cycles, some working in. So they're both equally enthused about that. And so am I, size. Size is different. At a high level, I guess, since I started Veeva or even before, I started Veeva, right, in the beginning of 2007, the one consistent theme is everybody underestimates the size of the industry cloud for life sciences. And they estimate the size and the impact if you could actually be essential and appreciated to this $1.7 trillion industry. That's what gets underestimated, and I think it's actually still underestimated over the long term. So we've got our major in life sciences. We've got our minor in this very specific segment outside of life sciences at this time.

Great. Thanks, Peter. Jim, turning back to clinical. The question came through, can you just comment on how we're doing with clinical research organizations, or CROs, where you'd talked about our progress with that customer segment?

Sure. Sure. So as I'm sure many of you know, CROs are unique and that on one hand, they can be a user or a customer of technology in the clinical space. But on the other hand, they're providing service to life sciences organizations, sort of like we are as a vendor. And so for us, the CROs act that way as both a customer, but also as a partner. So on the customer front, we've done very well with CROs over time. Many of them from the top on down, leverage our clinical products to run their business and to provide the service to their customers. But now we've also announced partnerships. If you've gone to our webpage on veeva.com, you can look under the Partners area where you'll see more information about our CRO part -- and all of those that have signed to become partners are investing their time in becoming EDC experts -- of all EDC experts so that they can build studies where their life sciences customers are asking for a better way to run EDC.

Thanks, Jim. And then sticking on clinical for the moment. Jim, just comment on our progress with our CTMS product, the clinical trial management system. It's a large competitive market. Just how are we performing there and how are customers viewing it? And how important do we view it as a piece of our own clinical suite of products?

Yes. It's a good question. So CTMS is one of those products where I shared the adoption curve. It's in that middle majority area and it recently sort of came to that place. And that's primarily for a few reasons: #1, like other products in the majority, that becomes an attach to some of the existing products, for instance, the eTMF, which is leveraged by the majority of the industry now; but also the CTMS needs modernization. I think many in the industry have been using CTMSs that are, in some cases, 20 or 25 years old, and they're looking for better mechanisms to manage their trial, to monitor their trial, to run a higher-quality trial. And so they're looking at Vault CTMS because we're bringing innovation in those areas, and we're seeing a really increased uptick and interest in the product because of that.

Excellent. Good. Thank you all for all the questions. We probably have time for 1 more. So Peter, I'll let you wrap up with this last question, and it's a good one. Longer term, do you expect Data Cloud to be a product within the Commercial Cloud segment that is complementary to CRM? Or is it more of a stand-alone product segment, again, a little longer term?

Data Cloud overall is a -- definitely a larger market than CRM itself, right? Data Cloud is -- that's a larger market. Now those products have to stand on their own in terms of excellence. But as we get broader in the Commercial Cloud, the customer is going to look for a suite approach, I believe, if we can do our job, right? So Data Cloud bigger than CRM, yes. Both have to be excellent and sometimes they have to stand on their own feet, but the synergy in the go-to-market and in the product is going to be bringing them together.

Great. All right. That's really all we have time for. Peter, I'll turn it back to you if you'd like to conclude the event.

Thanks, everyone, for joining today our Virtual Analyst Day. I really appreciate all the great questions, and it was super exciting to get that text from the product team that says, "Hey, here's the first product messages from MyVeeva." I look forward to talking with you again on our Q3 earnings call coming up. Thank you.