Steven Cutler: Yes. I mean, I’m not sure I can add much more to what I said before. We’ve seen a very solid environment, RFP-wise, ward-wise, right across the segments, be it large pharma, the biotech, and more in the sort of ancillary services that we do. Labs have been strong for us recently. Late phase, real-world evidence, and our late phase group has also done well. So it’s been fairly broad-based. I would say, I think we’ve pulled it out before, there’s been a little bit of a move towards FSP and hybrid solutions in the large pharma market. That’s been certainly a feature, and we feel well placed to be able to accommodate that and to put in place solutions that are more hybrid, I suppose, in terms of adding technology and adding opportunity to push on with margins in that space.
So but overall, again, it’s, I’d say, a broad-based positive environment. Biotech funding, of course, remains something of an overhang, but even that seems to be, to us, stabilizing. And I think the last month or two, there’s some green shoots there. So again, we’re finding good science getting funded. So, I won’t say any more. I think as I said, broad-based, positive, constructive.
Brendan Brennan: Maybe just to answer that, a little bit, it’s Brendan, here, obviously, folks are going to spend the money on the phase two to three drugs that are closer to, the market and have more potential, even if they’re if they’re taking a bit of transaction. So, that’s always a prioritizing area, and we’ve seen that in past cycles as well.
Elizabeth Anderson: Got it. No, and maybe one follow-up for you, Brendan. Obviously, had a nice improvement in the DSOs in the quarter. How do we think about the, like, go-forward rate for that and sort of where it might normalize? I know you’ve been talking about sort of differences between sort of pharma’s recent behavior and biotech. So, any more color on that would be helpful.
Brendan Brennan: Yes, everybody’s keen to hang on to their dollars at the moment, Elizabeth. I think that’s fair to say, ourselves included. I mean, I think we’ve talked about, in this organization with the blend of customers we have and the blend of commercial terms we have that the mid-40s is good. That’s a good position. So, if everything works well, that’s where we should be. If we’re doing exceptionally well, we’re below that. And if we’re doing a little off that mark, we need to catch up. I still think that’s where we’re looking for. So, as we think about the fourth quarter, obviously, we’re glad to be back in the 40s now, at 49 at the end of Q3, but certainly we’re still looking to improve in our two to three days as we go into the fourth quarter.
And I think that’s important from our cash conversion cycle as well as we get into the back half of the year to get to our free cash flow targets. So, that certainly is our target that we’re confident we can continue to go about doing that work as we get into Q4.
Elizabeth Anderson: Got it. Thank you.
Operator: Thank you. We will take our next question. The next question comes from the line of Jack Meehan from Nephron Research. Please go ahead. Your line is open.
Jack Meehan: Thank you. Good morning. Good afternoon. Brendan, I know you said you would provide guidance at JPM. I was wondering, though, if you had any framing comments for 2024, you could share them, put some takes. And just one thing I’d be keen to hear about is just thoughts on interest expense, like how does the recent debt upgrade maybe play into that?
Brendan Brennan: Yes. Please give us guidance for the guidance. Absolutely. Yes, I thought it was. Listen, I’ll start on interest. I do think we have a good opportunity here. Obviously, we’ve talked about the fact we’ve got a $310 million forecast for 2023. We’ve just been upgraded. We hope that we’ll see more traction on the other agencies before the end of the year. That will give us an opportunity to hopefully even consider changing the structure of our debt as we go into the first quarter of 2024. I think there’s a real opportunity to bring that interest down very substantially, like in the ballpark of circa $100 million a year. So, that’s obviously a very, very significant part of our overall thinking for next year. And it’s one of the reasons why, as we get into, we have to see how things will play out from the agency’s perspective and the timing of when we could do that.
So, it’s also another reason why January makes more sense to give more color and more detail on that perspective. I don’t know Steve, if you have any comments on the broader 24 piece, Jack’s asking for there at the moment, but from my perspective, listen, we’ve got another quarter to do here. That’s what we’re focused on in Q4. We think our book to build, it’s all to play for, there’s a good market environment there and if we can keep all those pieces moving, we should be in good charge for 2024.
Steven Cutler: I would concur with that, Jack. We’ve got a couple of months to go in this year. There’s a lot of things at stake and we’re obviously pushing through as much as we can get into this year from an awards point of view and at that point we’ll sit down and work out where we’ll be in 2024, but we’re not ready to get too specific about that at this stage.
Jack Meehan: Great, okay. And as one follow-up, I just wanted to nitpick the cancellation number a little bit here. It stepped up a bit quarter over quarter. Just curious what you’re hearing about from customers, like if there’s any re-prioritizations in the portfolio there, and maybe expectations for the fourth quarter.
Steven Cutler: No, we haven’t seen any sort of specific patents in the cancellations. It’s a tad up, but really not anything out of the ordinary, we didn’t think. We certainly see no areas of concern or specific, as I say, consistent patents in that number. I think you could expect a similar number, 2% or a sort of number in the fourth quarter. That’s the sort of expectation I would have, but we’re certainly not seeing any sort of any patent or increased level of cancellation due to any sort of environmental factor, so to speak.
Brendan Brennan: And that’s 2% on opening backlog, Jack, is what we typically would expect and have seen historically.
Jack Meehan: Great, thank you guys.
Operator: Thank you. We will take our next question. The question comes from the line of Patrick Donnelly from Citi. Please go ahead, your line is open.
Patrick Donnelly: Hey guys, thanks for taking the questions. Steve, maybe just a follow-up on Eric’s part of questions earlier. Still getting a few investor inbounds on that piece. I guess to ask a different way or frame it a different way, when you think about 4Q Book to Bill, is this the right ballpark, this 1-2-5 type area, the right ballpark, or should we be looking to back out BARDA and think about the 4Q number more in that, whatever it ends up being, 1-1, 1-1-5, whatever that might be, range. Just given what you’re seeing on our piece, it would be helpful maybe to frame up that 4Q Book to Bill expectation, given what you’ve seen over the last couple months.
