Pharmaceutical Services, sorry. Bernard Birkett, the CFO and Chief Operating Officer. Thanks again for making it. It's just the CFO. Just the CFO. Okay. Anyway, we have a lot of titles. Why not take more titles, man? Anyway, let's walk through, go through the quarter and kind of the dynamics that you guys saw, readjusting of the guide. You had some issues on the proprietary product side, on some of the products there. Walk through the dynamics and really what caused the reset. Okay. First of all, thank you for inviting us to the Barclays Healthcare Conference. It's a very productive day, and I appreciate that. No, we ended 2024 in line with our expectations as we think about it. 2024 was a year of a lot of, in our industry, a lot of the stocking effect that occurred. We saw that persist in our biologic space, generics, and we saw that in the pharmaceutical area started to dissipate as we went through 2024. We ended the year in line with our expectations, with certainly a stronger contribution of our HVP components, which is the thesis of the growth for West. As we moved into 2025, as we think about the growth algorithm, we guided about 2-3% organic growth on the top. The key driver of that growth is our HVP components going back to the mid to high single digits, primarily driven by really three factors. One is biologics. The second one is GLP-1 expansion. Number three is the regulatory changes in Europe with the Annex 1, which we are supporting a number of customers on molecules that are commercialized in the market to help them move up in HVP. That will be elements to give us the mid to high single digits of HVP. We are very pleased to see that we will probably gradually increase throughout the year. We believe that will get us well positioned as we move in the following year behind that. We also guided that our contract manufacturing business was looking at about low to mid single digit growth, primarily driven by the expansion that we made in our GLP-1 space, the investments made in 2025. We started seeing some of the lines coming online in the second half of 2024, but basically in Grand Rapids, Michigan, and also in Dublin, we'll see the growth start to start coming in line in 2025 and throughout 2025 as we scale. We do have a customer that has where we're going to be reducing or no longer produce an older generation of a continuous glucose monitoring device product that will have some headwind to that business. We will manage through that in the space, the location, facility, and team that we have in place will be repurposed for other business with other clients to build support, future growth as we go forward. The one area that actually was probably the most, created the most headwind for us when we started creating the guidance, and I'll let Bernard speak to this a little bit further, is around a product in our wearables within drug delivery devices. It's what we call a wearable SmartDose that we just simply are scaling up in a manual process. We put additional capacity in 2024. As we go into 2025, based on demand, where we are as a price point and where we are with the cost to produce a product is imbalanced. We have a three-point plan, really two key areas we're focused on. We have a long journey on that product as we scale and continue to scale. There's many areas that we can leverage. One area that will take a little more time throughout 2025 is moving from a fully manual process to an automated process. We have a full line that has been commissioned or will be commissioned in 2025, which allows us to get better efficiencies, throughput, and better margins. The other area is continued dialogue with our customer as they ramp to support them on their growth, but also get better economics with our customer. Those conversations are ongoing. There is urgency to get this rectified so we can update the community on where we are going forward. Those are the two drivers that we have around that product that created a headwind. When When you think about margin, all the good margin that we're the operating margin expansion with HVP components been negated by a device area is what we're going to focus and fix. I don't know if you want to add any comments. Yeah, I just think the important point is that we are seeing that growth in our HVP, like mid to high single digit growth that we talked about on our last call, that that is starting to return. We're starting to see the margin expansion come along with that as we bridge back to our LRP. That is really positive. We do have this short-term lower growth rate in our contract manufacturing business, which would be kind of low single digit growth for 2025. Again, that's primarily in the first half of the year. As Eric said, we're working to fill that capacity that's being vacated by one of our customers. This is a normal transition that we would see in that type of business within contract manufacturing. It is really resolving the issues that we have around SmartDose and the economics that we get from that platform and the drag that we are experiencing here in 2025 with that. Okay. Let's talk a little bit about the SmartDose and the device there. How's the pricing from among those key customers? There's only a few of them. I kind of want to talk about from the margin profile on that business. I mean, this is a HVP that was the whole part of your mix dynamic. Why is the, what is the margin? How much lower is this than your overall HVP margin from a gross margin? Why did it start so low? Yeah, I'll set this up is that when we started this development agreement years ago with our client, our customer, we had at this point, we didn't have the ability, we didn't have scale at that point in time. Therefore, the way that we set the agreement up was basically, I would say, wrong-footed in regards to our price and our cost structure. Again, like I said, we are correct in this, but that's how it was a new area for us to get into and to scale. It takes multiple years to get to where we are. The fortunate part is that we have product that is very well received by the end patients that we're being informed of. It is very important for our customer to continue to see the growth of their particular drug molecule in the market. We are able to support them not just in the U.S. market, but in multiple geographies. We are partnered with them and enable them to be able to grow. We need to address the price and also the cost structure, which I laid out earlier that we will address. Okay. As you think about that ramping, what are some levers that you can pull as that as capacity ramps in general in value? The biggest area, I mean, obviously, as we scale, we'll have better leverage on materials, but it really comes down to labor. It comes down to instead of having one facility, we have two facilities that are doing manual manufacturing of these products. By putting automation in, it will allow us to fully automate that process, allows us to reduce costs quite considerably by getting higher throughput, again, maintaining the high quality and also efficiencies to support the margin expansion. The automation was not put in place at the initial start of the product ramp just because of the development contract that you guys had. We started off as a manual process in one facility. You're right, the volumes were very much lower. The acceleration of the demand of the product for a customer required us to move quickly to double the capacity in another facility. We were not. We started commissioning and planning out the fully automated line, knowing that the ramp is going to continue to probably accelerate. That does take time to get installed, commissioned, and validated before we can run finished product through there. Yeah, it makes sense. Amount of timing. Gotcha. I'm going to turn the page here and go to the inventory destocking that plagued the entire bio processing and supply chain for the last few years. It seems like it almost should be finished for you guys to be a little bit more. You talked a little bit about there's still some effects that you're seeing there on the generic side. Give us any type of visibility you have. Update there on how you think about that kind of rolling off and. Yeah, I think it's contemplated when we talk about the high value. Really, a lot of this is concentrated around the high value product components. We think about the biologic continues to persist in the first quarter of 2025. The generics is pretty much we think, believe, are planned throughout 2025. It might be sooner. As you know, in biologics, the components used in that space is our HVP portfolio. Generics is roughly a little over half of our products are HVP in that area. That's contemplated when we say HVP components will grow mid to high single digits in 2025, which is a material improvement from last year. We're seeing the destocking starting to play through and visibility of orders, visibility of future demand planning over the next multiple quarters with our customers gives us that lens that we'll be building throughout the year and going into 2026. Our position in HVP components continues to be extremely strong. When we look at the new approvals, particularly in the biologics and biosimilars, our participation is extremely high. Hasn't changed. It's roughly around 90%. That's one big driver of this growth that we're going to see coming through. Obviously, after the destocking effect, the other two key drivers we talked about earlier were around GLP-1s and Annex 1, but all three are cumulative that allow us to get to strong growth as we have. Just a real recap. If you look at the last five years of HVP components, it's very strong in taking out devices and anything else. It's very strong double digits, close to double digit growth. That is the thesis of West's growth. We think about the drivers for future growth are consistent, but what has been added to this, not incremental, but added to ensure that we get back to our financial construct is this regulatory change that's occurring in Europe. We're seeing the projects, and it will be materializing in 2025. It will get us that assurance of that type of growth for HVP components to hit our financial construct. Yeah, and on Annex 1, we were sitting here last year, we were talking about the benefits and the tailwinds here. Talk about the conversion that you're seeing and kind of the momentum that you started to build now and talking about it kind of continuing through 2025. What's taken so long for this to kind of play out because it's not a relatively new regulation? Yeah, so within primary containment, the sterility assurance, sterility of the primary containment, that has been written in late or in 2023. A number of these projects that we have with our customers commenced, let's say, in 2024. It takes, we're seeing on average, between 12-24 months to really bring it into commercialization. We're supporting our customers to take in standard material components within our elastomer business that has readily, historically, been provided in bulk format. Now, with our customers, they're making a decision of do they build the infrastructure on the pharmaceutical washing, sterilization, Envision inspection, and potentially the finished packaging process. As we think about this, they're looking at the investments they have to make, and then they look at working with us saying, "At West, we can provide that service for them," which we have been doing. That has been the thesis of HVP for a number of years. These projects are very specific on certain molecules in market that might have a legacy formula with West that we are now putting through these different processes. We have to do the analytical testing, the documentation, and the filing to support them to make this transition. It does take time. We do believe this is a long journey. It is going to be a multi-year impact for West and continue to drive conversion of current volume in our standard components in bulk format into some part of our HVP portfolio. It is incrementally positive from an ASP and also from a margin perspective, but also supporting our customers and ensuring that they are meeting the regulatory requirements in Europe. The last driver of this is that a lot of our customers are not just looking at for product going into Europe, but looking at how do you standardize across the globe. We see this as a net benefit with a considerable amount of our customers and products in the market today. They'll eventually convert as well. Yeah. I guess from where are we in the documentation portion, getting things ready and starting to actually drive that conversion of the product, where are we in that step of the cycle? Is it something where you have to do this for each HVP category, or is it just something you can do bulk upfront and then we'll hit the switch? Yeah, each, unfortunately, we have to do one at a time. We can do a parallel process, obviously, with multiple customers. We have over, we mentioned we have over 200 projects in flight as we speak. A lot of them started in 2024. That continues to build. We see roughly about half of them start materializing in some type of revenue contribution in 2025. It does take time, but as we layer on these projects and move them to completion, we will see the revenues start pulling through. We did say that we will see an incremental benefit in 2025 of this transition that is occurring with Annex 1, which we did not really see all that much in 2024. Right. I think one thing is important to understand, one, it's customer specific, that it is each customer has a project. It's not us running projects and then going to a customer. We're working in partnership with our customers, and they really decide on when they convert and what they convert to. That is something we manage with them. I remember back as we were talking about it here last year, again, we were saying it is a multi-year process, and it is going to build over time. We don't believe it's like a J- curve or a hockey stick or anything like that. You have customers who are early adopters of changes, and then some take longer to make that change. Again, as to what extent they want to change as well, will be down to the customer. There are many different permutations as to what can be offered here. It really feeds into that, our LRP growth over a number of years. It's not just a one and done. Got it. Is it something with the customer specific? Is it something where, well, they have, I imagine if they have existing products, there's a lot more nurture to switching than if you have new products coming on. Essentially what they're doing is converting existing business we have with them through that we're providing standard products. It's really converting existing volume. We don't need volume growth essentially off that. It's existing business that we're adding HVP processes to. As Eric said, that increases the ASP and increases the margin and the return to us. Yeah. Gotcha. Let's jump into contract manufacturing here in the last third of the talk. You guys exited two CGM contracts. There's not a lot of CGM players out there. Just kind of walk through the decision to do this. How fungible is this, kind of how fungible is this capacity within the CM business? Yeah. In both cases, we've been working with a couple of customers over 10 plus years on older generation of CGM. The model that we have in contract manufacturing is that while we provide the facility, the infrastructure, the engineering, the talent to be able to install and scale and do mass manufacturing, our customers are paying in capital with their proprietary or their IP of technology or automation that does the assembly of the product. It is specific for a product. In this case, we have a customer that we've been working with for a number of years, obviously. They've been looking to the next generation or two generations to adopt in the marketplace. We will continue to support them on an older generation. That demand has kind of persisted for a little bit longer than we anticipated. We typically see 7-10 years and potentially longer with these agreements, these contracts with what we have our customers on contract manufacturing. The asset's fungible in the sense that when they pull their technology out, when they decide they no longer need that product for the market or they have a next generation that we're not going to participate on, they will pull the lines out of the facility. We will repurpose the facility for the next business that we bring in. That's also going to be the case later in 2026. We received information of another customer that has decided to bring a lot of the production in-house of the next generation. We saw it in both cases. There's an element of both insourcing versus outsourcing. In that case, that space will be repurposed later in 2026, going into 2027 for other customers that are highly interested in that space. The target customers that we have today are around pharmaceutical drug delivery. You think about auto injectors. You think about pens. That is a space that we are really focused on. If you think about why did West not participate in the next generations, we just look at the economics and said that part is actually dilutive to the overall CM. We want to stay where we are with our margin profile, with our returns. That is why we have repurposed that space for higher profitable business that will be coming down the road. CM business, while this is occurring, we are also ramping up on long-term agreements with the customers on GLP-1s, auto injectors, in particularly the United States and our Grand Rapids facility, but also in Dublin. What's unique about Dublin is not only will we be doing the injection molding and the assembly of the auto injectors, but we've also been asked by our customer to do the drug handling in this dedicated facility, which allows us to actually move downstream. This is not fill- finish, but this is the drug handling, bringing the drug material with contact with the auto injector, then going into the market. This is obviously to support our customers on their growth. We're creating value. We have know-how because we have a couple of projects that we have been working on with other clients on a smaller scale. We are really excited about this opportunity because the customer is pulling us into this direction, and we could have further expansions in other parts, such as the United States, to support our customers on drug handling. Better margin profile. It does not mean that we are going to flip the contract manufacturing business overnight, but it does reinforce our focus on value creation and see the margin expansion and also healthy returns on our investments. You talk about the GLP-1s in the CM business being around like 40% of that overall business. You are talking about building out capacity in Dublin, Grand Rapids, the CGM contracts. You are repurposing those into higher margin and higher growth businesses, arguably opportunity more for GLP-1. Fast forward like two, three, five years, depending on assuming that GLP-1s are the panacea of drugs that everybody expects them to be. Is this going to be a majority of your business probably as we kind of train that out? No. I think what you're going to see in contract manufacturing is because we obviously have several other types of delivery devices for other drug categories that we support in that business. We'll continue to diversify that portfolio as such. We will support in certain cases of further GLP-1, but I wouldn't say it would be taking on a majority of CM long term. On the proprietary side, it's different. We are very well positioned to build support all the GLP-1 drugs in the marketplace through our elastomeric components. And we have been entrenched with our customers for decades. We feel really comfortable where we are in that space. It's very, very high market share in the proprietary side. In contract manufacturing, I think the way to think about that is they de-risk by having one of four, one of five different suppliers using their technology to manufacture. So we would be in the neighborhood of 20-25% type market share for a client, which is pretty typical. But in the proprietary area, it's very different and better economics. On that proprietary side on the elastomer, especially, there's been a fear that other competitors can come in, lower costs. Talk about what you're seeing from that part of the market, new entrants or even just the pricing dynamic around there. I mean, you guys are I assume specced in. How hard is that for them to switch? It's difficult, but we're cognizant of the fact every day we continuously look at how do we improve the technology, how do we improve quality, how do we improve service. We have scale. There is no doubt that West is the largest player in elastomer components in the industry by far. Our win rate or participation rate on new molecules supports that we are continuing to be at that high level of participation, particularly in biologics, still in small molecules and also in the generic space. What we are also cognizant of is that in the supply chain with COVID, there is a drive to make sure that they're not solely dependent on a player. As you think about new approvals, the question is how do you. Primary and secondary. We continue to be the primary like we have historically. I think we have to be cognizant of the fact that competition wants to get in. We do not believe in a cost play or a price play. We are still thinking about a percent or less of the cost of the drug molecule with our customers. We have to drive the service. We have to drive the quality and the technology. As we stay in the forefront, we believe we continue to be the leader in that particular space. Quality and reliability is still the biggest driver. It's the biggest driver. You think about it, as I said, it's about 1% or less of the cost of drug molecule. If we're not able to provide product, that causes a major issue on drug availability in the marketplace. We pride ourselves on even during COVID, we're able to deliver product to our customers on the core business while we supported the COVID fight with vaccines. We have the scale. We have the capacity. There is a push towards HVP and this catalyst of not just some biologics and GLP-1s, but there is a catalyst around Annex 1. The capacity we installed for COVID is fungible for these initiatives and these growth drivers. We will be able to repurpose, get better leverage, and build support the growth for a number of years ahead, particularly around proprietary HVP components. It feels like a transition here. I appreciate it. Thank you. Appreciate your time. Yeah. Thank you, Eric. All the best. Thank you.