Cryoport, Inc. Q1 FY2021 Earnings Call

Thank you for standing by. This is the conference operator. Welcome to the Cryoport’s First Quarter 2021 Earnings Call. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. Operator Instructions. I would now like to turn the conference over to Todd Fromer, Managing Partner of KCSA for opening remarks. Please go ahead.

Thank you, operator. Before we begin today, I would like to remind everyone that this conference call contains certain forward-looking statements. All statements that address our operating performance, events, or developments that we expect or anticipate occurring in the future are forward-looking statements. These forward-looking statements are based on management’s beliefs and assumptions and not on information currently available to our management team. Our management team believes that these forward-looking statements are reasonable as and when made. However, you should not place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We do not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results, events, and developments to differ materially from our historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described in Item 1A, Risk Factors, and elsewhere in our annual report on Form 10-K filed with the Securities and Exchange Commission and those described from time to time in the other reports, which we file with the Securities and Exchange Commission. It is now my pleasure to turn the call over to Mr. Jerrell Shelton, Chief Executive Officer of Cryoport. Jerry, the floor is yours.

Thank you, Todd. Good afternoon, ladies and gentlemen. We appreciate you joining our earnings call today. With me this afternoon are our Chief Financial Officer, Robert Stefanovich; our Chief Scientific Officer, Dr. Mark Sawicki; and our Vice President of Corporate Development and Investor Relations, Thomas Heinzen. As a reminder, we have uploaded our first quarter 2021 review document to our website. It can be found under the Investor Relations section in the Events and Presentations section. This document provides a review of our recent financial and operational performance and general business outlook. If you have not had a chance to read it, I would encourage you to go to the website and download it. Now for a brief general update followed by your questions regarding our first quarter results. Following our major accomplishments in 2020, we entered 2021 with an unrivaled leadership position with market-leading temperature-controlled supply chain solutions for our Biopharma/Pharma, Animal Health, and Reproductive markets. Our global platform now consists of 32 locations, and a family of companies that provide mutually reinforcing solutions, services, and products. As anticipated, our new platform delivered outstanding performance for the first quarter, with revenue growing to a record $53.3 million. Our recent strategic acquisitions of MVE Biological Solutions and CRYOPDP contributed significantly to this performance as we navigated the ongoing integration of these two excellent teams. Since closing, the MVE Biological Solutions and CRYOPDP acquisitions, we have sharpened each team’s focus on the cell and gene therapy market and made investments to fuel their growth, positioning us for excellent growth in 2021 and beyond. As part of very large companies, neither CRYOPDP nor MVE Biological Solutions were focused on the high growth regenerative medicine markets. Now, as a product of Cryoport, we can leverage our deep expertise and resources to accelerate growth and market capture. In the short time since closing these acquisitions, we have made significant strides in defining strategic focus, aligning resources, identifying synergies, and fostering the respective innovation pipelines of each of these businesses. One example is the recent joint launch of Cryoport Systems and CRYOPDP’s new global logistics center in Osaka, Japan, which will further support and accelerate growth in the Asia Pac region. As I previously expressed, we anticipate achieving over $100 million of revenue and cost synergies over a five-year period of time between CRYOPDP and Cryoport Systems, and that is well underway. At MVE Biological Solutions, our production facilities are running at full capacity, breaking records monthly, as it benefits from the newly invigorated strategic direction. Revenue growth rates for both MVE Biological Solutions and CRYOPDP were significantly higher than their historical growth rates. We believe these first two quarters as a part of Cryoport are an early indicator of the growth potential of both of these operating units. We anticipate continued strengthening from both CRYOPDP and MVE throughout 2021. Cryoport’s overall organic revenue also increased by 35% year-over-year. Through our dedicated teams, ongoing investments, and expanded footprint, we now have a very broad reach within the industry and are dedicated to continuously scaling our business with focus and purpose. I’d like to emphasize that our business units reported record revenue year-over-year growth on a pro forma basis, as well as the sequential growth over our record fourth quarter 2020. The Biopharma/Pharma market was the primary driver for our growth and represented approximately 80% of our total revenue for the first quarter 2021. We continue to build out our pipeline of potential commercial customers with the total number of regenerative medicine clinical trials supported by Cryoport reaching a record 543 trials, compared with 465 at the end of the first quarter of 2020. Commercial revenue was generated primarily from our global agreements, supporting the continued market introduction of Novartis’ KYMRIAH and Gilead’s YESCARTA. In addition, Bristol-Myers Squibb has received FDA approval for its cell therapy, BREYANZI, and bluebird bio and BMS have received FDA approval for their CAR T-cell therapy Abecma, a first-of-its-kind CAR T-cell therapy for the treatment of multiple myeloma. These therapies mark Cryoport’s sixth and seventh long-term agreements supporting the global commercial launch of a cell and gene therapy. We expect these agreements to begin to contribute to our revenue in the second quarter of 2021 and ramp throughout the remainder of the year, driving additional growth in our commercial revenue in 2021. A total of three Cryoport-supported MAAs or BLAs were filed in the first quarter of 2021, based on internal information and forecast from the Alliance for Regenerative Medicine. Looking forward, we anticipate up to 18 MAA or BLA submissions for Cryoport-supported products during 2021. In addition to our organic growth and due to increasing demand for support in the APAC region, we supplemented our Osaka opening by regarding Critical Transport Solutions Australia, a market leader focused on premium healthcare logistics management services, specializing in time-sensitive critical solutions for the biopharma/pharma and medical industries in Australia. As part of Cryoport’s CRYOPDP business unit, CTSA will also support Cryoport Systems in Australia. CTSA is expected to have a strategic impact on our APAC initiatives, as the number of clinical trials in the region continues to increase. The acquisition of CTSA is an important step in our APAC strategy, as with the addition of CTSA, we will be able to serve the domestic Australian market more effectively, as well as providing robust temperature-controlled supply chain solutions for the international clients who need support throughout the APAC region. Now, I’d like to request that the operator open the lines for questions.

Operator Instructions. The first question comes from Brandon Couillard with Jefferies.

Hey, guys. This is Matt on for Brandon. Thanks for taking my questions. First, to start, maybe for Jerry. You talked about the $100 million plus of synergies over five years, mentioned again today, continue to work to identify them and execute on them, and remain on schedule. Can you just offer any additional color on the process you’re going through, key areas of focus, and maybe what you’re most excited about across the portfolio as you look at those synergies over the next few years?

Well, I can’t give you a lot of specifics. I can point to the joint operations that I mentioned in my commentary, Matt, where we opened up a joint center between CRYOPDP and Cryoport Systems. I can also tell you that much of the freight that was going to third parties is in the process of coming our way through CRYOPDP. We have a joint operation in Singapore as well. So, there are a number of things that are going on. It’s hard for me to categorize them or to go through all of them at one time. But I can tell you that those initiatives are well underway. Do you want to add anything to that, Mark?

Yes. I think on the cost side, Jerry was mentioning more on the operational or product side, so to speak. But on the cost side also, we have a lot more power that relates to spend management through third parties, like scheduling freight and airlines and others. The consolidated platform between systems and PDP provides the ability to leverage better pricing and discounting structures with transportation partners, for example. So, that’s just another example on the spend side for you.

And then, I guess, it shouldn’t really be a surprise, given your strategic partnership with Lonza. But we noticed you added some language in the most recent 10-K that both CROs and CDMOs are engaging your services exclusively in conjunction with their contract service platforms in order to service clients across your mutual client base? So, it looks you also added Syneos Health here in 1Q. Can you talk about the expectations for these type of relationships going forward, and the ability you guys have to kind of accelerate this and expand upon them to include Cryoport’s expanded portfolio of services?

Sure. This ties into an overarching strategy as it relates to putting together a comprehensive supply chain platform. We’re doing this in a couple of different ways. Obviously, through acquisition and organic-related build-out of services and competencies, but the other side of this is through partnerships. Obviously, we don’t have an interest in moving into the manufacturing side. But a manufacturing component is a very, very key element of managing the overall supply chain workflow for these types of products. An example, Lonza recognizes this particular need, and they don’t want to build this asset out themselves. They view it as advantageous for themselves as well as our mutual client base to establish strategic relationships that tie together and provide a unified business platform for our mutual clients, who engage their respective parties. This happens in a number of different ways. It occurs through the integration of our activities and in some of our systems with Lonza, for example, or other CDMOs. Additionally, we integrate some of our business profiles so that, for example, Lonza can directly offer our product offerings as part of their contracting process. So, that’s just a couple of examples of how this occurs and is a value add for the client base, as well as a risk reduction element for them.

The next question comes from Andrew D’Silva with B. Riley. Please go ahead.

So just to start, within biopharma, can you just give us a sense of maybe what percent of sales are tied to the regenerative medicine or selling gene therapy space specifically versus other kinds of biologics or small molecules that might be relevant with some of the more recent acquisitions?

That’s a question for Mark, Andrew.

Yes. It’s a little bit complex. Primarily, if you look at the historical business, the vast majority of the systems business is regenerative medicine focused, whereas the plurality of the business within the PDP organization has traditionally been a bit more pharma or biopharma focused. That obviously will shift over time, but I can’t give you exact numbers at this point.

Okay. Fair enough. And I have a couple questions about this. I believe it’s been renewed, but I’m not 100% sure, as it relates to Novartis’ relationship with you, or was it just Gilead thus far that renewed their original contract terms?

No contracts were renewed last year.

Okay. And I was doing some digging with some of your customers. Am I correct to say that when you sign a contract, your customers are typically committing to the overwhelming majority of all treatments utilizing your logistics platform? While it might not be 100%, it’s approaching 100% in many instances. Is that a fair statement?

Yes.

Okay, perfect. And then, as it relates to BMS’s recently approved CAR-T, were they contributors during the quarter? And do you expect them still to be material contributors to legacy Cryoport Systems sales?

They were not a contributor to Q1 revenue. They will be a significant contribution in the next series of quarters from our perspective.

And could you provide me just an insight into what was the reason for the significant quarter-over-quarter improvement in MVE gross margins?

Yes. Certainly, we can tell you that.

Yes. Looking at the overall results for the quarter, we achieved record revenue across all business units, including MVE, which saw revenue growth compared to both Q4 and its historical growth rates, and we anticipate that this growth will continue. This quarter also benefited from higher absorption, which contributed to the margins. We have previously discussed the margin elasticity related to the profiles. Regarding CRYOPDP, you will notice improvements in margins as they transition toward the cell and gene therapy sector of the life sciences industry, showing sequential improvement as well. However, you are correct that the most significant improvement was observed here, primarily due to the overall increase in revenue and growth.

Okay, useful context. Last question for me just on animal health. A couple of quarters ago, you mentioned maybe Zoetis as a potential partner? Is that part of the reason for the substantial increase in animal health even quarter-over-quarter, or is it really all tied to recent M&A?

This is really related to the historic business that MVE brought to the table on animal health. There’s been an increase on the Cryoport Systems side as well for animal health, but not to that level in terms of the opportunities that you just highlighted.

But those opportunities are still in place. They’ve been pushed to a degree because of COVID-related restrictions on travel, as it relates to validating and qualifying given facilities to support that work.

Okay. Okay, great. Well, that’s good color, and I look forward to seeing who some of those new partners are when they come on. That’s it for me. I’ll hop back in queue. Best of luck going forward.

Thank you.

The next question comes from Paul Knight with KeyBanc. Please go ahead.

Jerry, the clinical trial revenue growth was very strong; my math says above 60%. And then approved therapy revenue was down year-over-year. Could you add color around that?

Yes, we certainly can. And I’m going to defer that question to Mark.

Yes. As you guys know, tight Kite, Novartis opened multiple new global manufacturing facilities over the last 18 months. We’ve been talking about this; we’ve seen a small portion of those shipments shift from international to domestic. This was expected, and our global expansion, which you’ve seen in Japan, in Singapore, and others is moving in lockstep with what their overall strategies. We are seeing commercial shipping volumes increase, and we are confident that we’ll see this trend continue and accelerate through 2021. These guys’ recent expansion of their facilities effectively triples manufacturing capacity long-term. To make it clear, we are still supporting all of the shipments for both Novartis and Gilead, and with the new therapies, Abecma and BREYANZI, and TECARTUS launching over the last couple of months, we’re very, very bullish on the commercial ramp opportunity from a revenue standpoint over the coming quarters.

Okay. And on the trial growth, overall trial growth is 17%, Phase 1 was up 14%, or are academics coming back online, and then the Phase 3 growth rate was 11%. Could you talk to those two items?

Yes. It’s more opportunistic when these companies make a determination to reinitiate. Based on all the data that we have, all clinical pipeline, as it relates to patient enrollment at these centers is back to the pre-COVID levels. So, we don’t think that that’s a factor whatsoever. It’s now more related to their clinical strategies.

Okay. Regarding the MVE and CRYOPDP performance theory, are you seeing any impact from COVID? I understand it might be difficult to quantify, but can you share how COVID is influencing things, even if just qualitatively?

No, COVID is not a significant help, Paul. We’re focused on selling gene therapy. We do, however, support trials. We have a significant number of trials that we’re supporting in that area. We do supply dry ice replenishment in some parts of the world for some of the vaccines. But it is not significant to us. We are focused on selling gene therapy.

Yes. And with CRYOPDP and MVE, I guess labs reopening helps, et cetera. What would you attribute this really seems like strong performance too?

The strong performance has to do with a focus on cell and gene therapy and sharpening the strategies in both companies, and that’s just beginning; that’s just a process is just beginning.

And then, I guess, my last question would be regarding the teams that you landed in the quarter at Abecma and BREYANZI. I guess they weren't significant in the quarter those, I would assume, were not and then they ramp, I guess, rest of the year?

That's correct.

The next question comes from David Saxon with Needham.

This is Joseph on for David. Just wanted to maybe touch on the reproductive medicine side of the business, let's say you grew pretty nicely in the quarter. Concerning the backlog, do you suspect this to remain fairly strong throughout 2021 and maybe beyond? Can you maybe discuss some of the increased demand that you're seeing on your side or with your partners in that business?

Well, remember, we're expanding our reach as well. So we have increased demand. We have evolving strategies that are much consistently improving our effectiveness and we're expanding our reach. And Mark, I'm sure, will have some other comments on that, so I'll turn to him.

Yes, there are two key factors. One, we built a phenomenal team from an outreach standpoint in support of the reproductive medicine space. And as Jerry had mentioned, this is now a global team that's really pushing into international markets. The second is a reiteration of the strategy that we put together 18 months ago to establish key partnerships with the large clinic networks on a global basis and establish a full source relationships with those folks. Both of those, we believe, are absolutely sustainable. They’ll support that significant increase in profile moving forward for the reproductive medicine space.

And then maybe one little bit more high level, in terms of your cell and gene therapy clients. Can you provide a little information on how some of these clients choose between your different shippers, whether it be the advanced shipper, the high-volume shippers, or potentially when the Cryosphere is launched?

It's really dependent on their quality organizations and their product packaging configurations as to what they need. The good thing is that they have a lot of flexibility of choice. As it relates to us, everything that we have on the market is best in class. Dependence on whatever the quality organization mandates typically determines how they make that determination.

Remember, Joseph, we're a solutions company. We're agile, and we have tools to fulfill the clients’ needs. They do vary, and we vary in the way we fulfill those needs.

Do commercial clients use the high volume shipper, or is that more towards academic preclinical research?

It's heavily dependent on whether it's an autologous or an allogeneic therapy. If it’s an autologous therapy, they're traditionally using that high-volume format that needs a wider neck opening for the blood cassettes used for blood draws. Allogeneic therapies typically use our smaller unit, which has a much smaller neck opening because they’re typically packaged in a vial-based format. It's pretty straightforward from that perspective.

The next question comes from John Sourbeer with UBS.

From my calculations, it looked like MVE biopharma revenues were strong around 12% sequentially. Can you talk about any trends you're seeing there in terms of pent-up demand coming out of COVID? Do you see this business continuing to accelerate throughout the year, and are you comfortable with double-digit growth for the year for MVE?

We do not provide specific guidance on growth or our numbers. However, it is reasonable to expect that MVE's growth will continue to surpass historical levels. We supply some storage through our distributor network for COVID vaccines and are actively engaged in that area. Our focus is shifting toward a sharpened strategy in cell and gene therapy, while still serving all the traditionally served markets. MVE remains strong in animal health and biologics and is poised to strengthen further in cell and gene therapy. Although MVE is already performing well, its focus has not been fully aligned with this area, but you can anticipate ongoing growth in MVE.

And then I know you announced the CTSA deal in the quarter and expanding in Australia. Can you talk about the deal and any future M&A outlook, including expanding into areas such as China?

Well, we definitely will be in China and we're developing that strategy. It’s been under consideration for some time, and we absolutely will be there. We are there now. I mean, we have shipments in and out of China today, but we will have a bigger presence there because Asia-Pac is going to grow. We have an Asia-Pac strategy and we're filling out that Asia-Pac strategy. In terms of acquisitions, it'll be in categories of company logistics, courier, packaging, and especially in information technology. We have a robust pipeline, and we're looking at a lot of things. While it does take a buyer and a seller, there are a lot of things that we have our eye on, and we'll continue to supplement our organic growth rate with acquisitions. Our focus, however, is not primarily on acquisitions. Our focus is on organic growth, and the acquisitions will be supplementary and will come along.

I know the company doesn't provide guidance, but organic growth was strong in the quarter, I think street consensus by around 14% on revenues. Looks like current consensus is around 200 million for the year. Are you comfortable with that number, or do you see any upside? I know it’s early in the year.

Well, we feel comfortable with that number. We did beat consensus, and we're very happy about that. We think we're on a good track right now.

Again, just to remind you, the market that we're primarily focused on, the cell and gene therapy market, is really poised for accelerated growth. You see that we're already supporting seven commercial launches. So there's certainly upside potential to where we are right now.

The next question comes from Puneet Souda with SVB Leerink.

This is Scott speaking for Puneet. Congratulations on a strong quarter that exceeded our expectations for both the legacy Cryoport and the recent acquisitions. I would like to know if you are noticing any of the initial synergies you anticipated reflected in the revenue for MVE and PDP. Could you elaborate on what drove the strength in those areas, particularly in relation to the recovery from the pandemic? Additional details on the performance of MVE and PDP would be appreciated.

The biggest thing that we've talked about in terms of the synergy promise is the $100 million of synergies between CRYOPDP and Cryoport systems over the next five years. Mark is in a good position to make a few comments on that.

That's obviously been a focus of ours and we are starting to see some contribution from that perspective. We feel firm and confident in that $100 million target over the next four years that there's a clear line of sight towards that. Jerry had mentioned earlier in the Q&A that we are actively moving pipeline from a third party situation to the potential of PDP situation. Obviously, you have to go through the equality and the vendor approval processes, which takes some time, but those are very active at this point in time.

Regarding your question about MVE, the synergies are more subtle. They emerge from two different perspectives on the market that are complementary.

I also want to touch on just a competitive landscape. We've been seeing a few partnerships from CMO companies, such as Catalent, who are employing Stirling Ultracold, which is a pending acquisition by BioLife, and kind of just building out a little bit more on the cryogenic side, just their cryogenic capabilities. Could you guys speak to this? Is there anything new in the competitive environment? Is this a change in attitudes from the CMOs? Any color you provide there would be great.

No, there's no change in the competitive environment. In fact, Catalent is a partner and customer, and they, of course, use Cryoport systems and they use our e-products. We see their build out as normal for a cell and gene therapy manufacturing company, but they have to have storage, and that's what they're doing. We see all that as very positive.

Last year in 2020, it was an incredible year for cell and gene therapy funding, almost doubling 2019 levels by our estimates. Has any of that slowed down to the new clinical trial formation yet? Are you guys seeing that, and more importantly, are you seeing new customer demand, the funnel for new customers kind of expand with all those new funding that we saw last year?

If you think about it from two perspectives, the existing companies that have been in cycle for a period of time are extremely well-funded. The activity last year will continue to augment that clinical and commercial activity in the coming quarters, but there is a substantial number of new startups that have cropped up over the last 12 months. We have listed a couple of those in our most recent quarter review, and we anticipate additional startups to be very active in the coming quarters as well because this is a very bullish space for the pharmaceutical industry in general.

The next question comes from Richard Baldry with ROTH Capital Partners.

When we think about MVE running at full capacity, maybe two concepts. One, would that argue that the level of revenue you’re seeing out of them should be sort of sustainable at these levels, maybe incrementally higher as you build more capacity out? And then how expensive is it, in terms of cost or time, to increase its capacity? Its growth rate does sort of tick up closer into the growth rates of the biologic area you're focused on.

Rich, we bought in with growing it in mind, so none of this is new to us; it's all in our plans. At this stage, we have a fantastic team. I mean, I couldn't have asked for a better team that we have at MVE. It's a matter of optimization. We have three plants: one in Chengdu, China, one in New Prague, Minnesota, and one in Ball Ground, Georgia. We will be optimizing, and we are optimizing those plants at this time, and that will continue for a while. Certainly, we will have the plant additions and may have a new location at some point. I wouldn't promise you that right now, but that's certainly a possibility. There's plenty of lead time to keep up with demand.

If we look below the line to sort of comparing Q4 with Q1, the SG&A side went from 26 to 21. Which of those numbers seems more sustainable moving forward? Were there any one-time acquisition numbers that fell into Q4? Does Q1 feel like this is a good baseline to build off of as we look forward?

I think it's a good baseline. If you look at the remainder of the year, you can see some increase there just related to building out additional resources, but I think it is typically at year end Q4, even though we exclude it, all the acquisition-related costs, some of those were in there, plus you have some year-end increase that we typically make. So Q1 is a good starting point. Now you can assume some gradual increase just on building out additional resources.

Similar question on R&D; we've gone from basically doubling it over the last six months from $2 million-ish a quarter to $4 million. Does this first quarter number start to feel like a fully operationalized system, or building up from this point forward moderately quickly?

It’s too early to confirm that this is a stabilized number. We are very focused on our research, development, and engineering teams, and we have significant plans along with a strong innovation pipeline. A few developments to note: the Cryosphere will be launched in the latter half of this year, and we have several other projects underway. One of these is the Fusion 811, which will be available late this year or early next year. This smaller Fusion product will allow us to tap into a substantial market segment, particularly in areas with small facilities that don’t have plumbing for cryogenic temperatures. There are many other projects in our innovation pipeline. We will keep you updated on this number as we progress, but I wouldn't describe it as fully stable at this moment. It should remain in that range, but it could increase slightly, though I'm unable to provide exact details right now.

And since you don't give guidance, just a very general thought concept around the quarter with your adjusted EBITDA stepping up to $7 million. Are there any thoughts that there are one-time or cost savings, or revenue-generating factors in Q1 that we shouldn't consider consistent through the rest of the year? You talk about new products coming online with commercial approval that would arguably drive the service revenue side higher. Curious if that new adjusted EBITDA high is sustainable or if there are seasonal things we need to keep in mind when we reforecast on our own.

Yes, just to maybe address that. I wouldn't say there's anything seasonal in particular. The one-time elements; we've already eliminated a lot of that adjusted EBITDA, so that's a pretty clean number. Moving forward, again, in this dynamic market, you will see us going online with our supply chain vendors in Houston and New Jersey; that includes the bioservices. All those things will weigh into the adjusted EBITDA through the bottom line temporarily as they start seeing the full business volume come through. But I think it's a good number to use to project forward, and you just have to keep in mind the layer on top, the building out of the organization.

Last question, again, very high level. Your adjusted EBITDA now is higher than your total revenue in the first quarter of '19 not that long ago. So does that put you in a position to be more aggressive, maybe in terms of acquisitions on a go-forward basis to scale up the business? Or do you think it's more important to stay disciplined and have balance sort of top and bottom line?

Well, Rich, I think it puts us in a fantastic position. But we are disciplined, and we take very seriously shareholder funds. We don't even use the word spending; we use the word investment more than any other term around Cryoport. So we will be disciplined, but we also will be aggressive too as we grow. This market is growing very rapidly. We intend to continue to be the market leader and to grow our reach, continue to develop supply chain solutions that are compelling and more comprehensive and that meet this industry that's evolving and growing so rapidly.

The next question comes from Jacob Johnson with Stephens Inc.

It's Nathan on for Jacob. Maybe just one quick one from me, just to expand a little bit on M&A and from a high level. Should we think this is more focused on the services side or the product side? Is there any area within either that interests you right now, if you can shed some light on?

The information side interests me very much, and if we found an acquisition that made sense, met our criteria of being a well-run company, being accretive to the company and being synergistic to our endeavor in the services or the product sector, we’d be talking with them. I can't say that we have a preference in either place. What we have a preference for is continuing to execute on our strategy.

This concludes the question-and-answer session. I would like to turn the conference back over to Jerrell Shelton for any closing remarks.

Thank you, operator, and thank you all for your questions. That was a terrific dialogue that we just had, and we appreciate the questions. In closing, our first quarter was very successful and started the year following the strong fourth quarter in 2020. We achieved significant growth in the first quarter with a growing number of clinical trials supporting, continued outsized growth of Cryoport systems and Cryogene, outstanding performance from MVE Biological Solutions CRYOPDP, and in January, the closing of a $287 million follow-on public offering to further strengthen our financial position and support future growth. Our unique global capability widened our competitive moat and positioned us to extend our support of the life sciences industry, and especially clinical and commercial stage regenerative medicine therapies around the world. We anticipate that our continued development of our operating platform and highly differentiated solutions will continue to drive acceleration in our growth as the field of biology continues to develop. Thank you today for joining our call. Until next earnings call, we bid you a very good evening.

This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.