Yuan Zhi: Thank you for taking our questions. Great to see the strong revenue from commercial cell and gene therapies. So we heard some of the cell and gene therapy manufacturers weakness in 4Q. How do you see this trend so far in this quarter and the next couple of months? And then I have a follow-up question.
Mark Sawicki: I’m sorry, you’ve seen some of the commercial CDMOs doing what?
Thomas Heinzen: Yes. I’ll take it, Mark. You’re right, there were mixed quarters from the commercial – our commercial customers. Some of them had revenue below Street expectations. Others exceeded it by a lot, namely J&J, Legend and Sarepta. It is going to be a mixed bag in Q4 based on what they’re telling the Street. So we can’t really comment more on their forecast.
Yuan Zhi: Got it. And a follow-up question is related to the Tec4med acquisition. Does it mean now Cryoport would expand the capability to provide logistics to pharmaceuticals outside of the cell and gene therapy?
Mark Sawicki: The short answer is yes, it’s complementary to our CRYOPDP logistics offering, and it will provide them additional and enhanced competencies as it relates to data monitoring for areas outside of the cell and gene space.
Yuan Zhi: Got it. Thank you.
Operator: Your next question comes from David Larsen from BTIG. Your line is now open.
David Larsen: Hi. Can you talk about large freezer shipments within MVE? How is that progressing? Has growth picked back up? Or is it steady, stable?
Jerrell Shelton: Yes, David, the orders for freezers are back on trend. And I said on a stabilized basis is on – and there was a clarifying question asked earlier about second, third – first and second quarter. And so orders have stabilized across the board, the patterns are stable.
David Larsen: Okay. And then how many therapies – cell and gene therapy products, would you expect to get approved each year, roughly speaking. I think you were supporting around 15, last quarter. And I mean your commercial revenue, it’s pushing 10% of total revenue, I think. I’m just trying to get a sense for how much of your total revenue you think that could become, like into next year, and the following years, it seems like it’s growing pretty rapidly.
Jerrell Shelton: Alright. I’ll start to answer the question, David. But then Mark and Tom should add their comments as well. Look, the whole – this is no surprise. I mean, commercial therapy is what it’s all about. And we support them in those trials, because in order to get to the commercial – get these therapies to the commercial arena. And as we start to improve – approve 10 therapies per year, it’s certainly, the commercial revenue is going to dwarf depending on the number of patient potential for the indication, but it’s going to dwarf the revenue from clinical trials, and that’s coming. So it’s coming. That’s what we’re building the company for. That’s why we’re investing in the – in all of these initiatives for the future because we have to be there ready to support the industry as it commercializes. Mark, do you want to add to that?
Mark Sawicki: Yes. Yes, the numbers actually we’re currently supporting 12 commercial products, and Jerry is exactly right. Our entire strategy has been to capture the clinical space and retain it during commercialization. Gottlieb said back in 2019 that he anticipated by 2024 to ‘25, 20 commercial approvals a year. And we’re actually starting to see line of sight on that number. And so we’re very excited by that, especially because we’re supporting such a large percentage of the clinical space. We wholeheartedly anticipate and expect to retain the vast majority of those to commercial, and we’re building out our infrastructure to support that scale.
Thomas Heinzen: I guess a little bit for you. It’s 12 commercial today. Hopefully, two more will get approved before the end of the year, that would bring us to 14. Those two do have PDUFA dates or FDA dates before the end of the year. And then we have six more we’re forecasting to commercialize next year. That would bring us to 20 total, if we’re right. Of those six that we’re forecasting for next year, four already have PDUFA dates in the first – a little over the first 4 months of the year. And hopefully, that number will grow above six, but that’s what we’re seeing today.
David Larsen: How much revenue do you think those six could contribute to the business?
Mark Sawicki: What that anticipated number is, but obviously, we expect the commercial growth number to be disproportionate to our overall growth number over time.
David Larsen: Okay. Great. Thanks very much. Congrats on a very good quarter.
Mark Sawicki: Thank you.
Operator: Your next question comes from Brandon Couillard from Jefferies. Your line is now open.
Brandon Couillard: Thanks for taking my question. Maybe for Robert, circling back to the comment that you guys said, you saw the strong cell and gene therapy demand continue here into 4Q. Is it fair to assume that commercial revenues will be up sequentially in 4Q versus 3Q?
Robert Stefanovich: No, I think the way you have to look at it is really, obviously, longer term, we expect to see very solid growth on the cell and gene therapy side for commercial revenues as we add more commercial new therapies to the portfolio. If you look at the quarter and sequential growth, just because of the early stage of this revenue stream, you will have just timing-wise, different revenue streams. So, we expect to see growth year-over-year, clearly, but sequential growth really depends a little bit on the type of services we provide the type of accessories we provide. So, that may vary between quarter-to-quarter sequentially. But ultimately, again, we look at growth year-over-year ongoing.
Mark Sawicki: Yes, that’s why we always say to you guys, look at commercial on a rolling basis. We recommend looking at a four-quarter rolling average, and that’s where you should see very consistent growth as we look at that because there is some volatility quarter-to-quarter based on the timing of certain products and services that we are doing from a commercial standpoint.
Brandon Couillard: Got it. Appreciate it. And then I guess any more color you guys can add on the 27 new trials, pretty impressive just given kind of all the headlines around there of funding, is a healthy clip for you guys. Is that mostly existing customers building up the portfolio, anything competitive wins? Maybe I haven’t talked about this in a while, but maybe folks shifting from home brew on the earlier stage side, do you guys just kind of talk about who is kind of driving those 27 net new adds for you guys? Thanks.
Mark Sawicki: Yes. So, I can do, Tom, it’s fine. Yes. So, of those, we are still seeing above-average volatility on removals. So, that – we are actually seeing net increases that are higher than that. But with the volatility in the space, we are seeing still a fair deal of trials that are either being completed or terminated or suspended on a quarter-by-quarter basis. And so for Q3, we added 28. We had 26 that wind down, of those 15 were completed, 9 were terminated and 2 were suspended. A fairly large percentage of those, and I don’t have the number in front of me, are our new clients. So, we have been very successful in pulling share on the new client basis, as well as retaining in our existing trial base with our existing clients. Tom, if you want to add anything else?
Thomas Heinzen: No, you covered it, Mark. Thank you.
Brandon Couillard: Okay. Thank you.
Operator: Your next question comes from Richard Baldry from ROTH MKM. Your line is now open.
