Quintin Lai: Yes Larry I can’t recall I’ll have to get back to you on what it was as a percent of sales last year somewhere around 70% or plus or minus. We have seen growth year-on-year. And it’s a combination of volume mix and price that have driven the year-on-year growth. And if you think about it when some of the new drugs that Eric has mentioned that incremental volume of those drug successes typically come at our higher end of HVP like NovaPure. And so therefore it has a bigger impact. So it may not have as big a volume as much as mix impact for us.
Eric Green: And one additional comment the algorithm Larry of you think about the growth of HVP in the double digits that requires about 100 basis points increase year-over-year of volume for HVP. So we’re still in the 23% 24% corridor from a volume perspective. But — because the way that Quintin articulated the ASP margins it’s actually quite a significant impact on the overall portfolio.
Larry Solow: Got it. Appreciate the color. Thanks.
Eric Green: Thanks Larry.
Operator: Thank you. And our next question is going to come from the line of Jacob Johnson with Stephens. Your line is open, please go ahead.
Jacob Johnson: Hey thanks. Good morning and my best to Bernard as well. I guess I’ll stick with the popular subject in the morning. Maybe just first going back to the restocking dynamic you call it out as a slowdown in restocking trends. I’m just curious kind of what surprised you about this? Is it a lack of restocking and customers not going to as high as safety stock as you would have expected? Or is it some destocking not to get too caught up in the vernacular here. And then the other piece of that is just Eric you mentioned growing next year despite that inventory management. How should we how long should we think about this dynamic persisting?
Eric Green: You want to cover the first part?
Quintin Lai: Sure. So, Jacob, I’ll give you an example. We — at the start of the year we had customers putting orders in for Q4 that based on where we were in our capacity and our ability to deliver we said we’re going to have to get it to you next year. I mean that’s the lead time issue that we had and we had those type of discussions. As our teams have done a fantastic job of getting added and increasing the capacity we got over the issues that we had last year in terms of some of the issues of installing that some of the HPV processing capacity in one of our sites. We’ve built on new facilities in Kinston and in other areas. We were able to start to clear some of that backlog. And then we were able to go to those customers and said hey we’re going to be able to now deliver like you said originally for the end of the year.
And what they came back to us and said now we’re good. We’ve already reset our manufacturing schedules. We’re going to just take it here in 2024 instead. And so what we thought we were going to be able to do and handle it because now we’ve got that additional capacity and help restock them now it’s just a matter of timing. So, that just gives you an example of some of the things that we’ve seen as the years progress. Eric?
Eric Green: Absolutely. And I think the last aspect around this is that if you think about the dynamics of this long term what we’re speaking with customers on it is really is the rescheduling of their production lines and the need of the product. So, that’s why we are — we’ve given indication and we’re not giving we’re not giving the full guidance today but we’ve given an indication that 7% 9% corridor of the topline growth is and being led by HVP and it’s been led by Biologics. And we’re putting COVID into the number. So that gives you kind of dynamics that we’re seeing right now. So, we should this is a temporary situation.
Jacob Johnson: Okay, that’s helpful. And then Eric you were just talking about the Kinston capacity ramping in 3Q and 4Q. And you kind of mentioned that you would catch-up on maybe some back orders or something like that, if I heard you correctly. I’m just curious as it relates to that market do you think containment solutions have been a bottleneck for the ramp of some of these drugs? And is this something that as you get caught up on we should expect Kinston to ramp pretty well in 4Q and maybe into early next year?
Eric Green: Yeah. I would say no, we’re not the bottleneck to be clear. And some of these drug launches, we would state that we have been able to navigate and manage through. I was just — before this call we were just kind of doing another review of the customers that are coming out of that Kinston plant for particularly NovaPure plungers. And it’s quite a few customers. So it’s not one molecule, it’s not one customer. It’s multiple. And they’re ramping up for 2024 campaigns. So we’re excited about where we are. But I would say right now we’re not the bottleneck. It’s just — it goes back to what we spoke about earlier is that we would like to — they would like to see better — stronger safety stocks at their own — in their own pipeline.
But we do know that there’s, some other issues that we see but that’s not for us to discuss of some of these launches. But I would say we’re not the bottleneck. We’ve got the investments put in place. It’s validated. The customers are very satisfied with the quality of the product from our Kinston facility and we have capacity to continue to grow and support frankly the biologic launches. And these are the areas around oncology, autoimmune, immunology I mean these are exciting areas for us. And I think we’re well positioned for the future, particularly out of that plant.
Jacob Johnson: Got it. Thanks for taking my questions.
Eric Green: Thank you.
