Good afternoon, everyone. My name is Eric Coldwell. I cover pharma services for Baird. I want to thank Syneos for being with us today. Michelle Keefe, welcome, a few months into the new role. Thank you. Jason Meggs, of course, CFO. Have Ronnie here in the audience right here. Everyone just, what we're gonna do is, I think, kick it off with what, 10, 15 minutes of slides? 10. Ten minutes of slides, and we're gonna go into Q&A. Without further ado, Michelle- Great. I'm gonna let you kick it off, and then we'll jump into the fireside. Thanks so much, Eric. Perfect. Thank you. Before, I get into the market dynamics and some of the investments that we're making as a result of my ongoing review of the business, we wanted to give you a quick overview of our strategy and who we are. Let me go to the first slide. There we go. You know, you've heard us talk about the fact that we are unique in the fact that we have a fully integrated biopharmaceutical solutions model, and we meet our customers wherever they need us in their product development journey. We do believe very much in our integrated strategy. We have had so much success with it and get phenomenal feedback from our customers who are working with us in an integrated fashion. What we're learning is a lot of what we've done in our integrated offering is starting to resonate, even when we do point solutions, whether it's choosing us as your clinical partner or your commercial partner. The reason for that is if you just look at the pipelines of what's going on in pharma right now, and you look at the complex therapy, cell and gene therapy, mAbs, when you think about the complexity of bringing that science to market, it creates a high level of demand by regulators, payers, insurers, and patients. We need to reach the targeted populations in more meaningful ways. To achieve that regulatory hurdle is one thing, but the payer approval is critically important and ultimately market adoption, which is really where our unique model, you know, meets customers right where they need us to meet them. We also believe, and I think you all believe as well, that the market is a very fruitful one, right? It's very attractive. There are thousands of assets right now in early development in cell and gene therapy, as well as other complex modalities. There's about 85% of them that haven't even made it to, you know, the phase II or the phase IIIs. We have a particularly compelling opportunity for our transformational product development model. Our product development mindset, which combines clinical, medical affairs, and commercial, optimizes reimbursement and commercial success by providing our customers with the right evidentiary approach and market access strategies. You've heard us say this before, commercial helps clinical win business. Three of our five large partnerships were directly a result of commercial relationships and commercial insights helping us win those clinical partnerships. I think, you know, we've shared this before, commercial is performing extremely well. Our commercial business is doing quite well. Whether we are a single service or end-to-end solution, we are evaluating every asset for commercial success, and we do think that is one of our unique values. We do wanna provide an update on our key growth drivers and the current dynamics that we're seeing. I thought we could start a little bit with Top 50 Pharma. It's our largest organic opportunity. You know, Alistair has been saying this for 4.5 years. Large pharma is a huge opportunity for us. We have some new and expanding FSP relationships, including a top 10 relationship we won in Q1 that you heard me talk about at our last earnings call. We have won a sole provider partnership for PVG services in Q2 of 2022, and we have won some other individual full service studies and expansions into new therapeutic areas with existing partners. Across both clinical and commercial, our trailing 12-month revenue for Top 50 Pharma has grown 12%. Importantly, our commercial capabilities were key to winning three of those five large pharma relationships that we highlighted. It is actually strengthening our enterprise approach with those customers. Turning from our first half highlights to what we are seeing currently. While our large pharma relationships remain very strong, we are experiencing slower near-term awards flow based upon timing of our customers' current pipelines. We're very optimistic about the potential for these relationships to continue to expand moving forward. While we're pleased with our success in penetrating large pharma, we currently have fewer of these relationships, so near-term customer dynamics can have a more pronounced impact on our awards. You're gonna hear me talk about our investments, and many of them are designed to help us win these new partnerships in large pharma and expand our existing ones, which should serve to provide a more consistent flow of new awards. In the meantime, while there were delays in these partnership renewal processes during COVID, we have started to see a reversal of that trend, and we are actively engaged in discussions with several large pharma customers around potential opportunities and have continued to advance in these long cycle competitive processes with positive customer feedback. From a macro perspective, large pharma remains healthy, as evidenced by our trailing twelve-month RFP flow being up year-over-year, and the award slowness we've seen recently is related to the customer-specific dynamics. Let's now turn to the SMID customer base. We maintain our strong position in this market. We've had 18% trailing twelve-month revenue growth across clinical and commercial as of the end of Q2 and have grown our SMID franchise to $2.6 billion on a TTM revenue basis. Following record quarters of SMID awards in Q4 of 2021 and Q1 of 2022, the macroeconomic environment has begun to have a more pronounced impact on our RFP flow. As we mentioned on our Q2 call, we began to see higher than normal award delays that we believe are a product of customers taking a more deliberate approach to their developmental plans, a dynamic that has continued into Q3. Despite this trend, cancellations remain in line with historical levels. Because our clinical customer mix is approximately 50% SMID, higher than our large competitors, these dynamics with SMID customers can have a more noticeable impact on our bookings. This is another reason it remains really important, strategically important to grow our large pharma relationships. As a result of these near-term dynamics, we anticipate our clinical trailing twelve-month book-to-bill for Q3, excluding reimbursables, to be in the range of 1.05x to 1.15x. This is primarily driven by market dynamics and resulting slower SMID RFP flow, but also reflects our historically low level of cancellations in Q3 of 2021. Given the unique dynamics we've experienced during the third quarter, we felt it was important to share our anticipated trailing twelve-month book-to-bill for the quarter with you today. This isn't going to be a forward-looking metric that we plan on providing on a regular basis in the future. We fully acknowledge that these near-term headwinds are a challenge for us, but we remain confident in our strategy and our value creation plan. We are in a high-growth market and have accelerated our investments in areas that will enable our strategy to drive competitive growth over the long term. I think it's important that you know we're taking decisive action to best position our delivery for customers of all sizes moving forward, whether small or large. Let me quickly move on to the next slide, which will talk to you a little bit about those investments. First, Clinical Reimagined. I know I've had questions about what is Clinical Reimagined? It is our post-COVID tech-enabled operating model that we've begun to deploy. We've been doing it since the beginning of the year, since Michael Brooks joined into that role. It streamlines our organization and processes while adding advanced technology and data solutions to improve visibility, decision support, and insight generation. These expanded investments support increasingly complex development programs such as cell and gene therapy, FSP capabilities to support large pharma, and the integration of medical affairs and commercial insights far earlier in the clinical development process. Further, we are pleased with the significant improvement in our employee retention, and we continue to invest in retaining our top talent, as well as attracting new talent to support our growth. The operating model advancements we have implemented to date are receiving extremely positive feedback from customers of all segments. We continue to invest in business development to grow our large pharma relationships by adding individuals with strong, deep-rooted large pharma relationship experience. We're gonna continue to grow our strong SMID franchise through maintaining the high-touch approach we've always had and dedicated staffing that these customers have come to expect from us. We expect these investments to drive SMID awards in a more normalized funding environment through expansion of our BD teams, particularly in key global biotech corridors. The tech acceleration is a significant opportunity for us. It's built off of, you know, we started with Kinetic and commercial. We had phenomenal feedback there, and we're gonna be leveraging the RxDataScience team to rapidly develop and deploy AI-based applications that will accelerate efficiency and innovation. I, as I shared in Q2, we're starting with clinical. We're gonna focus on areas like patient recruitment and enrollment and site activation, and that infrastructure and scalability will help us win both large pharma partnerships as well as will benefit our SMID customers. To wrap it up, I just wanted to summarize a couple things. First, Syneos Health is uniquely positioned to deliver innovative, integrated solutions to better maximize the potential of every therapy for customer success. Given the volume and complexity of therapies in development, the long-term market dynamics remain strong, and it's very well suited for our business model. As we navigate through these near-term headwinds, we remain focused on our key growth drivers of accelerating our penetration of the large pharma market while maintaining our strength with SMID customers. We also remain committed to our ForwardBound programs and our annual EBITDA margin expansion. We are also expanding our differentiated solutions across the product development continuum, including Syneos One and full service Medical Affairs. We'll continue to update you on the state of our business, on our investments during our third quarter call leading into 2022. That concludes our prepared remarks. Eric, thank you for allowing me to go through that, and I'm gonna turn it over to you now. Thanks, Michelle. Appreciate all the comments. Obviously, the updated news today shifts around my Q&A a little bit. Sure. Bear with me as I think about the best phasing and process on this. I think what I'd like to start with is in 2Q, you mentioned that you were seeing delays in decision-making. Mm-hmm. Just sort of that final award wasn't getting over the transom. I would love it if you could give us an update on what you've seen as 3Q has progressed on that front. Sure. We've been tracking, as you can imagine, the decisions. Most of them have not been made. They're still delayed. A very small percentage of them have actually made it through the decision. We are still tracking that. The reason for our announcement today was because we were also seeing the continued moderation in the RFP flow. Okay. Now, when you say a small percentage of the decisions were made, could you talk about your hit rate on those decisions? Was this, if there is such a thing as typical, were you going against one competitor, two competitors, multiple competitors? As you can imagine, it's all things, right? Typical, yeah. Sometimes it's multiple, sometimes it's individual. I, you know, I don't actually have the number. I know that most of them have been delayed, though, because I've been very focused, and many of the larger opportunities have been delayed. What is the typical reasoning you get? I mean, we could think about a world with FX inflation, labor, supply chain issues, Russia, Ukraine, China rolling lockdowns. There's biotech funding. There's all of these different topics out there swirling around, and even some now talking about the Inflation Reduction Act. Mm-hmm. customers thinking 4, 5, 6 years down the road about whether they wanna start the next program or not, right? Right. That's a big debate. I don't know if we have answers on that at this point. Yes. When you look at the list of decisions that have not been gone to final award, have not completed, is there any consistent theme? Yeah. Is it broad-based? We're seeing much more deliberate decision-making. You know, we have been tracking our RFP flow and even the ones that are, you know, still not have gone to decision and look at it in regards to the published indices, right? There does seem to be some correlation there. We're hearing we're re-looking at our protocol. We're making sure that our regulatory pathway is clear. You know, we have heard, you know, we're being more conservative in how we do things because of our funding situation. I don't think it's one thing. We've heard multiple things. I don't wanna pin it on just one thing. Yeah. Last quarter you made some comments about large pharma that I think were maybe overinterpreted at the time or overestimated in terms of impact at the time in terms of not quite getting on the bookings. Mm-hmm. level that you were hoping for. It felt like at that time, to me at least, it felt like maybe that was more, transitioning to newer relationships. Mm-hmm. First, comments on that. Do you think the market overread those comments a quarter ago? Then perhaps more importantly, an update on where you stand. Sure. Because today what I'm hearing is it's not so much that Big Pharma doesn't have interest or demand, it's more that you're underweight in Big Pharma. Where there is demand, you're not seen. Right. as relative to some of your peers. Thank you for the question. Yeah. Yes, large pharma is doing well. The demand flow is up. I talked about it in my prepared remarks. We have five large pharma partnerships, and one of them really started ramping up in Q1 of 2022. As you know, those take a while to ramp. We do feel that there's just an opportunity that we are missing, candidly, that other larger CROs have, right? Other larger CROs have 10, 12, 15, depending on which one you're talking to, partnerships in large pharma. When you think about awards that you get across those multiple customers, they have more ability to manage across multiple partners. When you have four or five, we're very excited about the partnerships. They're doing well. We're in dialogue with them right now. We know that they're doing their review for 2023, and we know that awards are coming from large pharma, right? 'Cause this is the typical budget season. I worked at Pfizer for 22 years. This is budget season at pharma, right? We know that they're making those decisions. It's gonna be really important for us to break into large pharma. We're very excited about it. We are seeing partnership reviews to start to reemerge, right? Coming out of COVID, we're having a lot of dialogue with lots of customers who are thinking about, you know, what partners they wanna have moving forward. We feel really good about our ability to compete there, and that's why we're making some of the investments that we're making. If I'm not mistaken, your last quarter, your commentary was large client or pipelines, RFPs were up double digits. Now you're saying they're up. Is that a nuance? Is that a shift from double digits just or is that just? I- They're still up. I mean, I'm not sure. I have to look to Jason for that. Yeah, I'm not sure if we should read too much into that or if that's interpreted. Yeah. Yeah, I wouldn't read much into that. The RFP flow and the pipeline. You know, Michelle talked about the TTM RFP flow being up, and then also the pipeline continues to be up in large pharma. Yeah. It's really just. Yeah, I don't think anything has changed. Yeah. Yeah. I know you're annualizing. But it was- You're annualizing a very big quarter from last year as well. Yes, we are. A very big quarter. Okay. Yeah, that's right. I wouldn't read anything into that. Okay. I guess sticking with you, Jason, and you both have made comments on this, but I'll turn to the numbers guy for a second. In prior conversations, you've highlighted that, and maybe a bit loosely, but maybe perhaps even more qualitatively. You've commented that if you had a book-to-bill of 1.0-1.2 for the next couple of quarters, you still felt like you could have a growth year in clinical next year. I wanna be clear that we all understand what you're saying. Were you saying that on a quarterly basis, or is that more of finishing the calendar 2022 with a trailing twelve-month book-to-bill in that category? I just wanna make sure we fully understand your prior commentary. Yeah. The prior commentary was around the quarterly book-to-bill from, you know, where we were speaking in June about that, and then we reiterated on the Q2 call that from that point forward, we saw multiple quarters where the quarterly book-to-bill within clinical was below 1.2, 1 to 1.2. That, based on what we saw in the backlog as of that time and the relationships that we had and what we believed would come through in 2022, or I'm sorry, in 2023, we would move from that 7%-10% range that we had provided our Investor Day down to a mid-single digit. For multiple quarters, starting with the quarter two and moving forward. Today, unless I somehow missed this, you did not comment on the overall expected book-to-bill for the quarter. You really focused on the service book-to-bill. Yes in clinical. We don't really know what the firm-level book-to-bill will be, which would be a part of your growth rate in 2023, right? A component of it. That's correct. It's very early, and I suspect you can't say much, but are you still looking? Because the clinical service book-to-bill is 0.6-1.0 at the bookends of your range that you gave for 3Q. That's below the 1-to-1.2, but again, it's only for a piece of the total. What I'm trying to figure out here is, are you still today, and you may not be able to comment, are you still today thinking about next year and thinking clinical could be a growth business in 2023? Or does this kind of a book-to-bill in 3Q possibly take that off the table? Or is it just too soon to say because you still have September and 4Q to go? Well, that's right. I mean, it's too early for us to say on that. I mean, I think we, you know, directionally we're still very much where we were and what we talked about on the Q2 call. We're gonna, you know, matter of fact, this month we start going through the actual detailed bottoms-up build of our plan, our budget. What does Q4 look like? You know, we've won a significant amount of work over the last couple of years, right across the business. That's gonna, you know, come through. We just need to look at it from a bottoms-up perspective, see how, you know, all the backlog pulls through and then, you know, update once we know a bit more about how we finish the year. You know, there's a lot of focus on book-to-bills. There's a lot of other dynamics that play into revenue growth. It could be future M&A that isn't announced. Obviously, foreign currency moves up or down over the next year. The other big piece, and I think most important, fundamentally most important piece is the burn rate. I was hoping you could talk to us a little bit about what you see in your burn rate. I know it's been very different in pass-through revenue versus or reimbursable revenue. Yeah versus service revenue, but maybe just on an overall clinical segment level, what you're seeing in burn rate and what might drive that burn rate expectation up or down over the next 12 months. Because that, you know, an accelerating burn rate can be an offset to a decelerating book-to-bill. I'm curious to get your thoughts. Yeah, we often talk about burn rate because it's a difficult one, right? If you post a 1.54 book-to-bill in a given quarter, which we did in Q3 of last year, and at the weighted average study period is 60-65 months, right? You're gonna just by pure math see a deterioration in your burn rate. That's actually a good thing, right? Because you're adding a lot of backlog. I think, you know, as we work through the back half of this year, coming off the 1.06 from a Q2 book-to-bill, what we're talking about for Q3, that math is gonna go the other way, right? The burn rate, just from pure math, will accelerate to some extent. You know, what we're gonna focus on is, okay, you know, what does the actual backlog build look like by project? What are we gonna deliver? You know, we'll look at the burn rate to triangulate to make sure it makes sense. I think everyone should try to look at a burn rate knowing that our weighted average study period is sort of stabilized in that 60-65 months over the last several quarters, and know that this mathematically is gonna show an increase in burn rate and, you know, even work through some pro formas maybe on, you know, what if you had a 1.2 book-to-bill, what does the burn rate look like? It is an interesting exercise because by default, no book-to-bill, better burn rate. If there is a burn rate, is there the potential for a burn rate acceleration just inherent in what is in the backlog? Obviously, if you don't grow the backlog because the book-to-bill is low in a quarter- Yeah -that has a mathematical technical impact. Is there something inherent in the- Yeah in the pipeline of work sitting in backlog that could actually lead to an acceleration in existing projects that have already been won? I think Michael talked a little bit about it on the Q2 call that we had, you know, in the quarter two bookings, some more projects weighted toward neuroscience and general medicine indications versus oncology, which tend to have longer study periods. We're doing quite well in FSP and the way we take FSP bookings. As you know, we only take 12 months, so that can help burn rate. There are things within the backlog that can help in addition to the mathematical exercise. With our last 6 minutes, I don't want to spend a ton of time on this, but with the leadership changes over the last couple of years, coupled with the impacts of COVID and your investments in decentralized capabilities, you've looked at the book of backlog over time and said, "We need to adjust this." You made a moderate adjustment in 2020. You made a bigger one in 2021. Then I think unrelated, there were some cancellations last quarter that were not associated with a backlog scrub, if you will. Are you at a point now where you feel that the backlog, the integrity of the backlog on the reimbursable, the pass-through side, it's you're good to go. This is steady state. The housekeeping's been done, the adjustments have been made, and really now it just comes down to quarter to quarter pass-through wins and losses that are normal course. Is that a fair statement? Yeah. I mean, I think that, you know, coming out of 2021, after we adjusted the reimbursable expenses for what we thought were in our contracts and in our budgets, but weren't actually going to be earned and burned, given the new dynamics around clinical trials and the investments we were making, including, you know, M&A that we had done, we felt really good about it. You come into 2022 and, you know, we had, in quarter two, several things happen really related to the COVID portfolio projects we have in clinical. You know, business happens as we know, and we had some trials end early that ended up pulling some backlog out. We had a vaccine trial that was delayed for six months that pushed things out of the year. Then we did have one customer that decided to keep their investigator payments reimbursables in-house versus putting it out for the time being, which we had an assumption. We felt good about that. But again, these things don't really impact direct fees that much. It's just the reimbursables. So I, you know, I put that more in the doing business frame. So, you know, net-net, yes, we feel good about where we are on the reimbursable expenses in the backlog. Okay, I wanna hit one more on clinical, and just big picture on margin. Again, realize we're pushing hard here in September to get you to think out beyond this year. One of the Street's concerns coming off of 2Q was this balance between we like that you're investing in Clinical Reimagined, ForwardBound, the new ERP. There's a lot of things going on. What we maybe don't love on Wall Street is not having guardrails around what that means for margin in 2023 and beyond, especially in a tougher macroeconomic and market environment. There's this damned if you do, damned if you don't situation. You want to invest, we want to grow, we want you to become a better company over time. The flip side is we don't wanna have to take numbers down dramatically because you're spending away the margin. It's a tough question given where you are at this juncture, but how comfortable are you with that longer term plan that you've historically had that over an average year you would expand margin 30-50 basis points at the firm level? Are there any guardrails you'd put in to say, look, if things do deteriorate and we can't quite meet our growth objectives next year, maybe we pull back on these investments. I'll start. You start? Sure. Yeah. The good news about our investments, right? A lot of them, especially technology investments, are to create more margin expansion, right? That's a big reason. Automation, digital tools and solutions, things we can actually bring to customers, right? That will help in itself expand margin. Now having said that, some of them are very discreet investments in people, right? Talent in cell and gene therapy, right? You know, things around bringing new kinds of talent in, and so that we absolutely can modulate based on performance, right? You know, we're gonna look at them with a very keen eye to make sure we continue to keep our foot on the accelerator around the things that are gonna create a better model for our customers, that are gonna delight our customers, that we know are gonna create margin expansion, make us more efficient. We're definitely gonna focus on trying to, you know, keep those going. But obviously we have some flexibility with some of the things that are not directly tied to that, because we do think that digitizing this business and using AI and predictive analytics to just be more effective and efficient in meeting our customers' objectives is good business for this business, and it's good for us from a margin expansion perspective. We will balance it for sure. Okay. I want to give you some time on commercial. Sure. For those who aren't as familiar, you came from commercial. Yes. I view it as you fixed commercial. Well, thank you. Certainly contributed to turning around that business. I have a great team. It's been growing very nicely. You've had some very good quarters here. I know you like to only give the Syneos One updates a couple of times a year. Yes. In a more formal event. Is there anything that you could tell us about the market environment in total? Mm-hmm. Okay, look. SMID decisions slowed, Big Pharma ramps a little slower, deliberate decision-making. Does that also mean Syneos One traction is slowing? One question I've had quite a bit is the company's approach to do an integrated clinical consulting commercial pitch? Does that elongate the sales cycle? In other words, have you shot yourself in the foot by going to clients and asking for these more comprehensive long-term engagements, which might have naturally longer selling cycles anyway? Okay. I'll be brief there. Syneos One, as you know, we have a lot of assets under clinical development right now, and we have good line of sight into which ones will come into commercial. You know, we've done a great job with full service commercial and Syneos into commercial, but it's still Syneos One into commercial. It's still only about 15% of our revenue, right? Right. It's a small percentage of the commercial revenue. Only 15% of the commercial revenue. Yeah. Right? I think it's really just an important point that, you know, the commercial businesses within themselves are doing extremely well. I look at Syneos One, a full service commercial, as kind of throwing oil on a fire that's already burning, right? Commercial is doing extremely well. I think the thing that's really interesting, and this is part of Michael being Chief Operating Officer, is we are bringing commercial capabilities more regularly earlier on into clinical development and through Medical Affairs. Again, back to the complexity of the pipelines that are out there right now, Medical Affairs is a huge opportunity, and we are uniquely positioned to take advantage of that. I think you're gonna start hearing us talk more about not just Syneos One, but Medical Affairs as a real driver of differentiation and getting us in earlier with customers. We've run out of time, but I have to ask. Sure. One more question on commercial, and it maybe it's more of a yes/no answer. Sure. This performance, it seems like a combination of a lot of things. Recovering from COVID, getting back at some level into live meetings and more normal activity. Perhaps some of it is share capture, perhaps some of it is just Syneos One starting to contribute. Mm-hmm. Based on history that your clients are aligning with you in terms of where the growth is. What do you think? If you could list two or three, just maybe bullet point form, what's driving the commercial success, how would you force rank those? I think number one is, you know, the new commercial model requires more flexibility and it requires digital enablement, right? I mean, the whole commercial model has gone hybrid, right? It's digital, it's people and it's marketing, it's advertising, it's PR, it's everything. I think that that's a big reason, 'cause we were early adopters of that during COVID, and I think that we've been a natural share gainer there. I definitely think that that's one reason. I also think at the end of the day, right, you know, you're going to invest in your assets. After you did everything you could to get them on the market, you're going to invest in them to maximize, you know, your revenue capture, and I think we're uniquely positioned to help customers do that. Okay. I've pushed on the time, so I'm gonna introduce the next few companies and then we'll say goodbye. Twist Bioscience coming up in this room, Halozyme Therapeutics, Marinus Pharmaceuticals, and Caladrius Biosciences are the next four presenters. Thank you very much. Thanks, Eric. Please join me in thanking Syneos. Thanks, Eric. Thanks, Eric. Thank you.