Repligen says it will both reinvest in its manufacturing network and look for M&A opportunities to feed the high demand for bioprocess consumables.
For the full year 2020, bioprocessing tech firm Repligen Corporation reported sales of $366 million, up 36% year-on-year. The fourth quarter itself pulled in $108 million, representing a 56% increase on the same period 2019.
As with fellow bioprocess vendors (Danaher, Sartorius, Thermo Fisher etc), COVID-19 played a major part in Repligen‚Äôs 2020 top line, with its products supporting numerous vaccine and therapies targeting the virus. The pandemic will continue to drive opportunities going forward, the firm said, with COVID related revenues expected to double from $46 million in 2020 to a range of $90 million to $100 million this year.
However, even without the pandemic factor, demand for Repligen‚Äôs tech was on a strong upward trajectory with non-COVID related revenue growing 18% for the year.
As such, the firm hopes to expand this year both organically and through acquisitions, management told stakeholders on a conference call yesterday.
‚ÄúAs we move into 2021, we will continue to be opportunistic on M&A and we will focus on expanding our franchise footprint with differentiated technologies,‚ÄĚ CEO Tony Hunt said.
Repligen has been active in dealmaking over the past year, the latest boosting its single-use chromatography and filtration systems portfolio through the $200 million acquisition of ARTeSYN Biosolutions in October. This came off the back of the acquisitions of biopharma plastic fabrication firm Non-Metallic Solutions and Engineered Molding Technology (EMT), a maker of silicone single-use consumables and components for bioprocessing functions.
‚ÄúWe believe that the M&A and highly differentiated new products developed and launched over the last 18 months will propel Repligen to above industry average organic growth over the next three to five years and we have set our sights on achieving 1 billion in revenue by 2025,‚ÄĚ Hunt said.
Capacity and headcount
‚ÄúThe other things that we’re doing this year with capital,‚ÄĚ CFO Jon Snodgres said on the call, is ‚Äúreinvesting quite a bit in the business to build out capacity and across all of our filtration franchises and systems. Even in proteins we’re looking at opportunities to expand capacity, both from a footprint and equipment perspective.‚ÄĚ
This includes investing in workforce. ‚ÄúWe’re adding headcount pretty quickly,‚ÄĚ he said.
Repligen has previously told us it spends $20-$30 million per year on ‚Äėcapital projects,‚Äô including manufacturing capacity expansion, systems implementation (SAP) and normal maintenance. Last July, the firm upped its yearly CAPEX guidance and said it expects to invest over $100 million over the next few years in its network.
Snodgres added Repligen is also investing ‚Äúin working capital and areas like inventory‚ÄĚ to make sure Repligen‚Äôs part of the supply chain is not disrupted.
‚ÄúYou should continue to see those strategies be active throughout 2021. And obviously, we’ll continue to relook at things as we get through the year 2021 and into 2022 about what we need for the future, to support obviously the current growth we’re seeing, but also the future growth we expect.‚ÄĚ