IQVIA Holdings Inc. (IQV) on Q1 2021 Results - Earnings Call Transcript
Operator: Ladies and gentlemen, thank you for standing by. At this time, I would like to welcome everyone to the IQVIA First Quarter 2021 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. . As a reminder, this call is being recorded. Thank you. I would now like to turn the call over to Andrew Markwick, Senior Vice President, Investor Relations and Treasury. Mr. Markwick, please begin your conference.
Andrew Markwick: Thank you, Casey. Good morning, everyone. Thank you for joining our First Quarter 2021 Earnings Call. With me today are, Ari Bousbib, Chairman and Chief Executive Officer; Ron Bruehlman, Executive Vice President and Chief Financial Officer; Eric Sherbet, Executive Vice President and General Counsel; Nick Childs, Senior Vice President, Financial Planning and Analysis, and newcomer for this call, Bryan Stengel, Associate Director, Investor Relations and Bryan has succeeded HealthTech. Today we will be referencing a presentation that will be visible during this call for those of you on our webcast. This presentation will also be available following this call on the Events and Presentations section of our IQVIA Investor Relations website at ir.iqvia.com. Before we begin, I would like to caution listeners that certain information discussed by management during this conference call will include forward-looking statements. Actual results could differ materially from those stated or implied by forward-looking statements due to risks and uncertainties associated with the company's business, which are discussed in the company's filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K and subsequent SEC filings. In addition, we will discuss non-GAAP financial measures on this call, which should be considered a supplement to and not a substitute for financial measures prepared in accordance with GAAP. A reconciliation of these non-GAAP measures to the comparable GAAP measures is included in the press release and conference call presentation. I would now like to turn the call over to our Chairman and CEO, Ari Bousbib.
Ari Bousbib : Good morning everyone and thank you, Andrew. Welcome and thank you for joining us today. This morning we reported first quarter results with strong double-digit growth in all key financial metrics and as a result of this performance and an improved outlook for the rest of the year, we have once again raised our guidance. The 2021 guidance that we provided to you last quarter was already within reach of our original pre-COVID plans for 2021. Our revised guidance today significantly exceed those original plans. In many ways, 2020 was a reset year for our company and also for the industry. We've been saying for a long time that the traditional timelines for the development of new drugs are too long. The speed at which COVID vaccines were developed in 2020 has obviously raised the bar in terms of what expectations should be.
Ron Bruehlman : Thanks Ari, and good morning everyone. As Ari mentioned, this is a very strong quarter. I would start first by giving you some more detail on revenue. First quarter revenue of $3.409 billion grew 23.8% on a reported basis and 21.4% at constant currency. Technology & Analytics Solutions revenue for the first quarter was $1.348 billion, which was up 20.7% reported and 17.1% at constant currency. R&D Solutions, first quarter revenue of $1.868 billion improved 29.6% at actual FX rate and 28.1% at constant currency. Pass-through revenues were a tailwind of 770 basis points to the R&DS revenue growth rate in the quarter.
Operator: Great, Thank you. And your first question here comes from the line of Robert Jones from Goldman Sachs. Please go ahead, your line is now open.
Robert Jones: Great, good morning. Congrats to everyone and especially, Andrew, hopefully, we will still get to communicate and you will miss having to talk to all of us all the time. I was going to ask already about the long-term guidance, but I think it sounds like, I can anticipate the answer will be wait till later this year. Obviously, the updated revenue guidance today, it looks like it's a CAGR of 9% to 10% off of 19, so it sounds like, if I heard you right, we'll get more on that later. So instead, maybe I'll just go back to a bigger industry question around M&A, Ron, you mentioned getting the leverage below the target that you guys had set out and clearly there is a ton of activity in this space right now. So, I'm curious as you look at the business and you look at some of the movement around you in the space in what your competitors are doing, do you feel like there are capabilities that you really need to go out and buy to enhance or build out what you're already doing or do you think IQVIA is in a pretty formidable competitive standpoint where it is today?
Ari Bousbib : All right, well Robert, lots of questions here, and I would not mind that your long-term question either, but the reason why we think we need to update our long-term guidance, as you will recall in June 2019, we shared our three-year planning process and the goals that we set for ourselves, we had called both on the topline and on the productivity measures and the continued efforts to re-engineer the company and make it more efficient and we set some targets in terms of top line and bottom line growth at the time. Now, obviously, lot has happened, 2020 as I said in my introductory remarks was a largely a reset year; and therefore, we feel it's appropriate to pause and update you on the progress we've made and look -- I think likely grow through those numbers in 2022 to give you some more precision. We feel that we need to complete our planning process and then when we are ready later this year, we hopefully have an investor conference similar to what we had in June 2019 and then update 2022 and obviously try to give you the sense for the new maybe 2025 targets. So that's what the long-term strategy and goals. With respect to M&A activity in the sector, look we are not surprised, since, the merger that the IMS and Quintiles back in 2016, now we are approaching the fifth year anniversary, a lots of activity has occurred, we believe strong into reactions to what we did. We disturbed and disrupted the industry, which was the goal of the merger, we believe we are accomplishing the goals we have set for ourselves at the time. We believe this strategy was right, the strategic rationale was right and hence the flurry of activity to try to acquire those capabilities any way possible. And that barring the ability to acquire those technology data and analytics capabilities, then CROs are compelled to either sell themselves or merge, and that's all I'll say on what's happening. With respect to our own M&A activity, we've said before that we were interested in deploying capital to acquire strategically compelling companies that added capabilities, we've done that mostly in the technology area to accelerate the growth of our technology business and the acquisition of those capabilities. We will of course look every time that in assets that is within our businesses is to tap for sale and you probably all know with those have been or are and we look and we do the work in every case we are fast so far. So that's all I will say, I mean, we've said before that we have -- look we have a lot of liquidity, right. We have now between the $2.3 billion at the end of the quarter and 1.5 billion of untapped revolver capacity that's $3.8 billion, obviously we used $760 million of that on April 1 for the acquisition of the minority stake in the lab business which we are very, very excited about. And so we have a little over $3 billion of cash on that deployable, and we would rather spend it A, on internal development; B, on strategic acquisitions and barring all of that, we would invest the balance of available cash by redistributing to shareholders via share repurchase as we've done historically.
Andrew Markwick : Thanks, Robert.
Robert Jones: Thanks, Ari.
Operator: Your next question comes from the line of Eric Coldwell from Baird. Please go ahead, your line is now open.
Eric Coldwell: Hey, thanks very much. Good morning. A lot of things we could hit on here, but I know I'm going to get inbounds on the COVID stats for the quarter in the year. If you'll bear with me on this, I know it gets laborious but would it be possible if -- sorry if I missed it to update the number of the trials you've been awarded to date in COVID, any insights into the percent of revenue in Q1 or your outlook for the year related specifically to COVID vaccines or therapeutics, maybe something on the percent of backlog that is represented by COVID or any comments on the pipeline of activity around COVID studies that would be great. Thank you so much.
Ari Bousbib : Thank you, Eric. So look on the number of trials, I have no collection of the number of trials, I can tell you though the most relevant impacts from COVID are obviously the COVID vaccine trials, which are large and fast burning as you know, and so that's really what moves the needle. We've got a lots of a small COVID-related activity all around the company, but that doesn't move the needle, what moves the needle are these COVID vaccine trials and as you know of the five Phase 3 large vaccine trials funded by Operation Warp Speed, we've had work on four of them. Now, we haven't done the full clinical trial on all four of them. We've done it on two of them and the other one is on the third one, we've got the pharmacovigilance work and on the other one, we have the lab work. So those are the ones that have had the most impact. With respect to the impact on the first quarter excluding these work, R&DS revenue grew mid-teens. So that's the impact in the first quarter. What was your other question -- that you also pointed out that the COVID work has had an impact on the first quarter growth as for the forecast as well. As you know, we've said that on previous earnings calls, we've had demand from governments around the world, in the US, the FDA, in Europe, in Asia as well and those have also provided high growth in the first quarter. Without those activities, the cash revenue growth would have been in the high single digits. So, roughly, I think you could say that COVID contributed all these large fast burning COVID work and it also contributed about half of the total company revenue growth. What was your question on the, I guess on the R&DS backlog you asked. What it is as a portion of the backlog? If I recall, Andrew, correct me if I'm wrong, if we look at the service backlog in R&DS, it is in the high single digits.
Andrew Markwick : Yes, that's correct.
Ari Bousbib : Yes. So that's what it represents. Now, it does have a much longer tail than we would have thought. It is certain it is going to remain with us through 2021 and well into 2022. There are many reasons for that. There are many vaccines for multiple manufacturers that are being developed to meet global demand. We are still responding to RFPs for vaccines around the world in many other countries that want to develop their own vaccines. There are follow-up studies for adapting the vaccines for the mutations of the virus. There are alternative versions of the vaccine that will be needed in case of adverse safety events or in case of quality and manufacturing issues and then there are bunch of novel treatment programs that are targeted at specific populations, specific conditions and then there is a lot of safety monitoring work, that is also in the pipe. So again, the first point that I understand, the context of your question the COVID-related work is not going away anytime soon, and is here for a while, we're very happy that we have our fair share of that market. What I also should say because I know if you didn't ask the question, you're going to ask it soon that the RFP pipeline across the board is very strong, well beyond COVID. In fact, our pipeline of qualified RFPs is approaching $25 billion if I remember correctly.
Andrew Markwick : 23.
Ari Bousbib : 23, okay. It's over $23 billion and it's growing double-digits, both in volume and in value. Again, bear in mind, as I said in my introductory remarks that the work that should have happened in 2020 on all of those other trials that were either about to start or starting all in flight, lots of it was kind of slowed down or pushed to the right. So because of that we've got that pent-up demand that's coming out. And Number 2, lots of projects that normally would have come in will displace, crowded out by the efforts that everyone puts on trying to resolve the COVID situation and so all of that is coming through, and we are confident that both because the COVID work is not going the way in a sharp manner. And number 2, because we've got all of these other activity, there has been bubbling up. We are confident in our guidance for this year and continued strong momentum for the business well beyond COVID.
Eric Coldwell: Thanks, Ari.
Andrew Markwick : Thank you, I appreciate it.
Operator: Your next question comes from the line of Shlomo Rosenbaum from Stifel. Please go ahead, your line is now open.
Shlomo Rosenbaum: Hi, thank you very much. Ari, if you don't mind, I'm going to try and slip in a few. First, I want to ask you if you could talk a little bit about the Real World evidence trends and update us and how that's going that's been a very strong growing in the past. Number 2, just wanted to ask you for a little bit more detail on how you accelerate the growth in net Q2 business by owning all of it. And then finally, I mean how do you do an encore for a quarter like this. I mean can you talk about the discussion about the business momentum, continuing it's such a strong quarter it's hard to believe that you'll be able to improve the partners and I know I've asked a lot but going to kind of put them out there.
Ari Bousbib : Yes. Thank you, Shlomo. Well, look, we are not suggesting we are going to have the 25% growth or whatever that we showed here on the ongoing basis that's not the normal all these and I will explain why, in response to Eric question was a little back of that large fast burning vaccine work for COVID had on our business. Now, excluding all of that, the business has strong momentum. You will recall, we gave guidance for where we wanted to get as a company. By the end of 2022, when we faced high single digits was going to be a new normal where we believe we are going to be above that excluding all of the disruption and the unusual bubbles. So, again excluding that fast burning work that we had in the first quarter, the R&DS business grew mid double-digits and the TAS business grew high single digits excluding the COVID related work. So that is very, very comfortable with. The rest of the year obviously would be higher than that again because we have the trailing impact of COVID we think one into 2022 and the pent-up demand that needs to be caught up. So, all of that helps build momentum. With respect to your specific question on Real World, it is strong double-digit growth in Q1. I mentioned all the -- we spoke last time about the care registry for the FDA. We spoke about the patient monitoring efforts, the deployment of our advance, we now have over a 1 billion patient lives in our database and we've continued to platform for clients with the deploying our eCOA platform, which helps collect clinical data directly from patients. We are seeing extremely strong demand on Real World, obviously this is just getting started now that we are seeing demand to track patient populations in terms of people who had the virus in terms of surveilling patients that actually took the vaccines and monitoring for potential adverse effects, etcetera. So, all of that plays right smack in the center of both our capabilities are in Real World.
Andrew Markwick : Thank you, Shlomo.
Operator: Your next question comes from the line of John Kreger from William Blair. Please go ahead, your line is now open.
John Kreger: Thanks very much. Hey Ari, just maybe a follow-up, I think last quarter you talked about your assumption within TAS, you assumed RWE COVID work would really sort of fall off I think in the second quarter. Do you still feel that way or do you think this is going to continue to be strong throughout the year?
Ari Bousbib : Yes, I mean, look, it's going to continue longer than we expected that's why I said in response to an earlier question, we were not assuming that we would continue at the time and that was the basis of our guidance for the year. The reason we are updating the guidance and increasing it so much is A, to reflect the performance in the first quarter -- the over performance but also to reflect our revised expectation that this work is going to continue for the balance of the year. It will not be at the same level as it was in the first quarter or the fourth quarter and will gradually start declining, but -- it is still significant for the balance of the year and importantly into 2022.
John Kreger: And Ron, a question for you. I believe gross margin year-over-year was down something like 90 basis points. Was that I'll driven by the higher pass-throughs in R&DS?
Ron Bruehlman : Yes, I still think it's a higher pass-throughs in R&DS and some of the COVID work is inherently a little bit low in margin in some of the other work. So those are the key reasons.
Ari Bousbib : But our operating margins are up.
Ron Bruehlman : Yes, our operating margins are up, our EBITDA margins up 140 basis points in the quarter, so despite that overall very strong performance, obviously at the leverage of the higher volumes and we didn't increase cost accordingly.
John Kreger: Great, thank you.
Operator: Your next question comes from the line of Tycho Peterson from JPMorgan. Please go ahead, your line is now open.
Tycho Peterson: Hey, thanks. I want to go back to one of the original question just on the M&A in the space you've got three competitors now all tied up with mergers. I'm just curious, what are you hearing from customers, how do you think about the opportunity to maybe pick up share in environment where there is a lot of distraction in churn. Can you maybe just talk to those dynamics?
Ari Bousbib : Okay. you look, whatever I say here is just we know opinions and the little bit of an educated set of observations based on, as you said, improve some clients and being having our fingers on the pulse of the industry. Look, we were already gaining share and we're not counting on others to be weaker than they were in order to gain share. We are largely, our market share gains, which I think are evident are the result of our unique differentiated capabilities and offerings. So, that's number one. We don't spend that much time roofing at what other people do in the industry. We focus on our strategy and building out our capabilities and trying to persuade customers that they should go with us and we are successful doing that. Now, If I look out, obviously I can't miss the activity, you will recall that IMC Research and Inventiv merged in order to form Syneos, LabCorp bought Chiltern, PRA bought Symphony Health, ICON is merging with PRA. PPD selling itself to TMO, what else, LabCorp is exploring strategic alternatives, whatever that means. So, a lots of activity and I probably missing some, but generally, in the CRO business, there are very few cases where there is synergy between two CROs, very few cases. If someone is largely present in Phase 1 or preclinical and Phase 1 and somewhat that is stronger in Phase 2, Phase 3 that maybe you could sell this complementarity and value. Someone is very strong in the US, very weak in Asia and someone else is very strong in Asia, very weak in US then you can see there is geographic complementarity, and there is value. But in most cases they're serving the same client base and in many cases including for the people that I just mentioned who are merging, there are clients where the two of them are the preferred providers for applying. So what do you think is going to happen. The client is going to remain with one provider. So, we are going to have negative synergy -- dyssynergy on the revenue side. Yes, you always have cost benefits because you don't need two CEOs, two CFOs, two General Counsel's etcetera, etcetera. But largely, this is a project-based business. You still need a different team for every project. So, the level of scalability as a result of the merger and the efficiency because you put two CROs together is extremely limited. So I don't see that much value there and then don't come back to me if I have -- we are buying CRO and telling why you are buying the CRO. Again, that could be cases where it does make sense again because the complementarity are indeed complementary or because the customer coverage is complementary, etcetera. So again, we want to focus on what we do. Clearly, the company in a merger situation is weakened, we experienced it ourselves. Despite the fact that we were doing a merger between two totally different companies that we're bringing very rich capabilities to each other, but the merger, no doubt about it, is disruptive, the sale is disruptive, balance, fees, we've experienced it, so we know what is going to happen. Obviously, each an opportunity for us. Again, we're not counting on that, we are gaining share regardless.
Andrew Markwick : Thank you.
Tycho Peterson: Okay. And then one follow-up, speaking of things you are buying on the Q2 Solutions, I just would like a little more color. I mean you mentioned that streamlines decision making, you can build out greater bio analytical capabilities, but can you just talk a bit more on the rationale for bringing that back in-house and I know you had a question earlier on how you can scale it up, I didn't hear an answer to that as well.
Ari Bousbib : Yes, I mean, look, we owned 60% and was managed jointly we had joint venture, but mostly I think it has been run largely by outside in terms of the management, it fit into the clinical trial process, the companies who put together originally both were relatively weak in this space. It was turned around, improved, it's a strong business, those capabilities are extremely sought after, the market is becoming more and more attractive. There has been back to the M&A question. There are number of a very attractive highly specialized biologic genomics related labs that came up for sale, and we were unable to proceed decision making, ability to focus, etcetera, and all of that I think will be for see it going forward. So, we as a business that we like it's a growth business, is an attractive business and we want to invest in it and when and if there are acquisitions in this space, we would seriously look at them and be able to move faster. Now also compelling in passing that might say it was a financially no-brainer kinds of transactions for us.
Tycho Peterson: Thanks, Ari.
Operator: Your next question comes from the line of Patrick Donnelly from Citi. Please go ahead, your line is now open.
Patrick Donnelly: Hey guys, thanks for taking the question. Ari, maybe just on the OCE business. It's not the biggest piece of revenue yet, but a nice growth opportunity. I think you talked about 10 ads this quarter, can you just talk about how that business is looking in the face of the pandemic, what you're expecting as we go through the rest of the year and just the competitive environment there?
Ari Bousbib : Well, look, we continue to win in the marketplace at about the same pace, I mentioned we had 10 clients win so far in 2021. We have 150 since launch. The large client deployments are going very well, now implementations went well despite the COVID environment last year that will build any slowdowns, in fact some deployments are seeing accelerated timelines, everything is on schedule. I know if you just go to disclose the names of the clients, and now in this business, I'm not sure. The feedback is very positive generally, the field reps are very engaged, way of course the Roche global deployments international operation, the AstraZeneca U.S. deployment, all of that is largely on target, very good positive feedback, you know that we see is rather revolutionary compared to other offerings in the market. It's not just a CRM, it's platformed on force.com and the Lightning platform. It's a very collaborative tool, utilizes AI and machine learning to integrate various functions within the pharma companies, commercial operations, enables faster integration of data and therefore faster deployments. It links the have-to providers and the suite data for a better view of the doctor and all of that again optimizes our client salesforce effectiveness. And then since then obviously, we are adding modules that are based on the OCE platform, we've got HCP engagement management, we've got OCE optimizer's, we've got the Next Best Action, all of those are enhancing functional capabilities that our clients are buying and that helps grow the business even faster.
Patrick Donnelly: Great, thanks Ari.
Operator: Your next question comes from the line of Sandy Draper from Truist Securities, please go ahead, your line is now open.
Sandy Draper: Thanks very much. Just maybe one quick clarification and then a broader one. First one, the comments you made about the growth rates, was that constant currency or is that reported?
Andrew Markwick : Okay Sandy, Yes, the growth rates we've given to the guidance on a reported basis.
Sandy Draper: Okay. So like the low-teens and mid-20s, that was reported. Okay, great.
Ari Bousbib : The FX impact is slightly positive during the course of the year but engagement a big driver and it remains same as the year goes on.
Sandy Draper: Super, that helps. And then maybe more broadly for whoever wants to take it. Obviously business is going really well. As you said Ari, it looks like the target is higher, it seems to me, may be one of the biggest challenges, you're going to have, because you said a lot of this is the service business and obviously some of the software is software can scale, but how do you think about -- do you have to change anything about hiring, think about where you're going for people, are you worried about wage pressure but it's clearly you're going to have to add a lot of people to continue to build to get to the growth you're doing? So we just love your thoughts on hiring wage inflation and how you manage adding that many people in what's a very positive, but also competitive labor market. Thanks.
Ari Bousbib : It's a great, great question, and you know you are touching on one of the obviously the biggest operational challenges we have and that's a natural challenge when you're growing and you're in service industry and you're right, the software-based business or the data subscription business, they are growing, but not at the pace that the services business is growing and in aggregate in relative terms, we are still going to need to hire people. Now two observations, number one, in early 2020 and 2019 early 2020 in anticipation of continued growth, we already had hired a lot of people. We did not restructure people in 2020. We kept people and even while they weren't working and we paid them, they are here and they are now working and delivering. So we haven't had to hire more people as much as you might think relative to our workforce last year and it's part of the reason why we are having nice margin expansion here. Second observation is we talked before about merger of competitors, obviously this is going to lead to some talent bleed and availability and we are in fact being approached and talent there but, Yes, I mean wage inflation that's true across industries and certainly in our industry as well. So we have to deal with that. You know that we have a program to a continue to seek efficiencies, scale whether it's through consolidation of activities, using our offshore centers, automation of processes, etcetera. And we have a lot of programs to create cost efficiencies that again the purpose of which is to continue to be able to deliver margin expansion, even as we've got wage inflation. Ron.
Ron Bruehlman : And one more thing Sandy, anticipated wage inflation is fully factored into our guidance.
Sandy Draper: Yes.
Ron Bruehlman : Sorry Sandy go ahead.
Sandy Draper: No, I just say thanks for taking the question.
Ron Bruehlman : Okay. Thanks Sandy, it was pleasure.
Andrew Markwick : I think we took our time to probably just one more question before we get to the top of the hour.
Operator: Great, thank you. Your next question comes from the line of the Elizabeth Anderson from Evercore ISI. Please go ahead, your line is now open.
Elizabeth Anderson: Hi guys, thanks so much for the question and squeezing me in. I must say free cash flow was very strong in the first quarter. I just wanted, how you thought that would continue the piece across the year. I mean obviously last year was extraordinary for variety of reasons, including on the free cash flow front, so I just wanted to see sort of how you guys are thinking about the pace as we move through the rest of the year. Thanks.
Ari Bousbib : Ron?
Ron Bruehlman : Hi. Elizabeth and thanks for the question. Look, we did have very strong cash flow. It's not a coincidence, since the start of the pandemic, we've been focusing a lot on that, on collections, not letting accounts receivable slid past due, we've been successful in working down our overdue and negotiating contracts with better billing terms with customers and you're also seeing, although there has been pressure from the industry from clients to extend billing term that's kind of winding down, there is a one-time impact and then you hit steady state. Now having said that, look cash flow is lumpy, so, I'm not going to promise that we're going to have $700 million of free cash flow every quarter. It tends to go up and down, but we have fundamentally shifted our emphasis on improving cash flow, and you've seen that over the past year. Just as a general guidance, help from the guidance, you would expect free cash flow in an average year be between 80% and 90% of adjusted net income and keep in mind that our adjusted net income is growing quite strong at least. Our cash flow will grow on that basis, but in any given quarter or any given year or even it may differ from that. Cash flow is not like earnings, it is not as smooth, it goes up and down, but yes, we have seen improvement and we expect continued strong cash flow going forward, but expect to normal volatility that any company is going to have in cash flow.
Ari Bousbib : Quarter-to-quarter.
Ron Bruehlman : Quarter-to-quarter, correct.
Andrew Markwick : I think let's try and squeeze in one more quick one as well, before we end.
Operator: Thank you. Your next question comes from Dave Windley from Jefferies. Please go ahead, your line is now open.
Dave Windley: Hi, thanks for squeezing me and I appreciate it. Ari, I thought maybe the most impressive important number in the quarter was the $6.5 billion in next 12 months backlog that's such a big sequential increase, I think it's the biggest since you merged and I know you said earlier in the call that it's clearly -- bookings were very strong that layers in, you're rolling forward to the next quarter -- it's an outsized improvement and gives great visibility for the next 12 months and I wondered if there was also something to be read into that either that sites in patient recruitment are opening up and there is a greater comfort level that has -- might see a cooperation on that and/or some of your tools for -- I wondered if you could just add some color to how that outlook is improving so dramatically.
Ari Bousbib : Thanks so much for that question, and, yes, you're absolutely right and your observation there has been a dramatic sequential improvement in our next 12 months revenue growth outlook for the R&DS business by over $600 million and this is the result of our continued strong net new bookings performance as well as again as you pointed out correctly steadily improving clinical trial recovery landscape. Now, by the way this metric of next 12 month, now includes the first quarter of 2022, which is again an encouraging sign. As you also point out continued strength well beyond this year. Now in terms of the improvements that we're seeing in terms of accessibility to sites and so on, so forth; recall that we had in the Q1 earnings call just a year ago, 20% of our size were accessible. In the Q2 call, it was 53%, Q3 was about 70%, Q4 was slightly above 70% and now it's higher than that and trending up as well. I think it's in the 75% and 76% range. Our guidance for 2021 picks many factors into account with respect to next 12 months revenue from the backlog, we do this project by project, right. It's a bottom-up process where we evaluate the expected revenue burn for each project for the next 12 months. So, it's an extremely precise exercise and I think a very relevant measure, an indication of the visibility on our business is going forward. But beyond access to site, the site startup activity is actually above the 2019 level. So site startup activity is a very strong indication of revenue balloon going forward and that's above pre-pandemic levels. Patient recruitment it's -- patient visits same thing very close to pre-pandemic levels and trending up. So, bottom line is these metrics provide a strong confidence that the trial pipeline and I'm talking now about the non-COVID trail pipeline, the one that's being awarded or that was awarded and pushed to the right is starting to be delivered with sites enrolling, patients enrolling and patients visits. So you're absolutely correct and thank you for bringing up the question. I hope that you're going to draw the conclusion.
Dave Windley: I appreciate your pass time a little bit, but that's very, very helpful. Thank you.
Ari Bousbib : Thank you, Dave.
Andrew Markwick : Thanks for the question, Dave. And thank you everyone for joining us today. We look forward to speaking with you again on our second quarter 2021 earnings call. The team will be available to take any follow-up questions you might have for the rest of the day. Thank you, everyone.
Operator: And this concludes today's conference call. You may now disconnect.
