The operator welcomes participants to the IQVIA First Quarter 2024 Earnings Conference Call and provides instructions for the call. Kerri Joseph, Senior Vice President of Investor Relations and Treasury, introduces the speakers and mentions the availability of a presentation. She also cautions listeners about forward-looking statements and non-GAAP financial measures.

The company had a strong start to the year, with revenue growing 6% excluding foreign exchange and COVID-related work. The backlog reached a new record and net new bookings were approximately $2.6 billion. The RFP flow and qualified pipeline also saw growth, and there was a substantial cancellation in the CNS area. The company expects an improvement in the back half of the year for the commercial side of their business.

In the first quarter, revenue for the company grew 2.3% on a reported basis and 2.9% at constant currency. The company is seeing faster decision-making from clients and there is more clarity on budgets. However, the overall sentiment remains cautious due to the uncertain macro environment. The company's adjusted EBITDA for the quarter was $862 million and adjusted diluted EPS was $2.54. The company has expanded its global strategic partnership with Salesforce to provide customers with a new engagement platform. There is also a shift towards digital interactions in HCP engagement and increased emphasis on direct-to-patient solutions, in which the company has been investing and seeing good market traction.

In the quarter, IQVIA's TAS segment saw increased demand for their technology-enabled analytics solutions from top pharma and med tech clients. This included contracts for smart engagement, omnichannel navigation, commercial compliance, patient relationship management, and real-world studies. These solutions aim to improve drug development, marketing strategies, compliance, patient support, and market access for clients.

IQVIA has been awarded contracts by a top 10 pharma client to demonstrate the effectiveness of a novel eye movement technology and to conduct a large real-world respiratory infection vaccine effectiveness study. They were chosen for their expertise and global presence. IQVIA is also involved in public health initiatives, such as helping to eradicate polioviruses in Africa and creating a national oncology network and database for a European Ministry of Health to improve cancer survival rates.

In the public health sector, IQVIA has been selected by the global fund to support 13 African countries in improving their supply chain performance and ensuring availability of commodities and services. In R&DS, IQVIA has been awarded contracts for vaccine development and FSP services, as well as securing two large Phase III oncology studies based on their AI-enabled capabilities. These wins highlight IQVIA's expertise, innovation, and global scale in the pharmaceutical industry.

In the first quarter, the company experienced growth in revenue, adjusted EBITDA, and GAAP net income. They also saw strong performance in their R&D Solutions segment, with a record backlog and increased revenue from backlog. The company's acquisitions contributed to their growth, and they successfully won a large trial by utilizing their AI-enabled capabilities. The paragraph also mentions a decrease in COVID-related revenues compared to the previous year.

The company's cash and cash equivalents, gross debt, and net debt figures were reported for the first quarter. They reaffirmed their full year revenue guidance, which includes a year-over-year FX headwind and assumptions about COVID-related work and M&A activity. They also provided second quarter guidance, which includes a larger FX headwind and a gradual improvement in revenue growth expected in the second half of the year.

The company's adjusted EBITDA and diluted EPS are expected to be between $870 million and $890 million and $2.54 to $2.64 respectively for the second quarter. The company also reaffirms its earnings guidance for the year, including a growth of 7.4% to 10.3% in adjusted diluted EPS. The first quarter was a strong start with expected TAS revenue and an increase in backlog. The company also notes positive indicators in the clinical trial business. A large cancellation was absorbed into the numbers, impacting revenue and bookings, but the company does not typically disclose cancellations.

The company's gross bookings were the second highest in its history before cancellations. The company had an unusual cancellation worth $0.25 billion, which was in the news. The company reassured that its underlying business remains strong and it can absorb such a large cancellation. There will be no change to the company's guidance, and the adjustment is solely due to foreign exchange. The cancellation may have some impact on revenue in the current year, but it is part of a larger program that will play out over many years. In the previous quarter, the company reported double-digit growth across all customer groups, but this quarter saw mid to high single-digit growth.

The speaker, Ari Bousbib, responds to a question about the RFP flows and book-to-bill ratio in the current quarter. He states that the RFP flow is consistent with their expectations and gives specific growth numbers for different segments. He also reassures that the company has not changed their expectations and mentions that their qualified pipeline is at a record high. In response to another question about the TAS business, Bousbib mentions strength in the pipeline and positive conversations, but does not mention any potential areas of upside.

The paragraph discusses the current performance of the TAS business, which is meeting expectations and showing growth despite the impact of COVID and currency. The company expects further growth in the second half of the year, but notes that some clients are being cautious with their budgets due to macroeconomic concerns. The data and tech businesses are performing as expected, while the real-world business has experienced a slowdown but is expected to rebound. The Analytics & Consulting business has shown some improvement in the last quarter.

In the third quarter, the company's performance was not as strong as expected due to a decline in the LT segment. However, the real world segment performed better than expected and the company has a strong pipeline for future growth. The FSP model comprises about 15% of total R&D revenue, but excluding pass-throughs, it is closer to 20-25% and continues to grow.

The speaker discusses the impact of a recent partnership with Salesforce on the company's margins and efficiency. They mention that the partnership was driven by the dominant competitor's announcement of re-platforming their product, and that the company aims to continue having the best product in the market.

The company has agreed to develop a new life science cloud based on Salesforce's technology and IQVIA's IP. They expect it to take two years to develop and will jointly market it with Salesforce. Customers have reacted positively to the transition. The CEO had no surprises in the quarter and the business is predictable. The large cancellation was due to client assessment of the environment.

The company's recent study has been well reported and they were aware of its results. The timing of the finalization is not yet set, but it occurred within the quarter. The quarter was uneventful and met expectations. The use of FSP in the industry has been fluctuating and there is a trend towards hybrid models. FSP is not expected to completely replace full service, and is mainly used by larger pharma companies.

The speaker, Ari Bousbib, responds to a question about the company's recent success in winning a contract for two simultaneous studies in oncology. He explains that the company's long-cycle business means that these types of contracts have a slow-moving impact and won't affect the company's performance in the short term. He also addresses a question about potential motivations for conducting two trials at once, and suggests that it may be related to maximizing revenue before potential negotiations on pricing with Medicare.

Ari Bousbib, CEO of IQVIA, discusses the company's structure and the potential impact of the IRA on client behavior. He explains that while clients may be trying to accelerate timelines due to the IRA's potential impact on intellectual property protection, this is not the case for the specific trials mentioned. He also addresses questions about pricing discipline among peers, the cancellation of a CNS study, and the role of AI in driving EBP wins.

Ari Bousbib, CEO of a company, discusses pricing pressures from clients and the impact of a large cancellation on revenues. He also mentions the potential for AI in healthcare but notes that data availability is a limiting factor.

The speaker discusses the difficulty of finding information for identifying patients and sites for clinical trials, but notes that their company has been successful in this area by leveraging data and technology. They mention that they have been doing this for a while and have seen positive results. The questioner then asks about the recovery of TAS and discretionary spending in the commercial side, specifically in relation to drug approvals. The speaker notes that there were fewer approvals in the current quarter compared to the previous one, but they are already seeing a strong start in April. They mention that the timing of pharma engagement and bookings varies by region, but as approvals increase, there should be growth in the discretionary areas that have been slower.

The speaker, Ari Bousbib, is cautious about predicting a comeback for the DAS business, but notes that there were a record number of approvals last year, which usually leads to increased spending in the following five years. He expects a rebound in the business, with the real uptick coming next year, as the pipeline is currently higher than ever and customer sentiment is improving. He also mentions that budgets were trimmed towards the end of last year, leading to uncertainty in negotiations with clients.

The company feels that there is more clarity on budgets which has increased confidence for awards in the remaining year. Decision timelines have also improved which is a positive sign. There is typically a lag of 6-12 months between approval and launch of a drug. The team will be available for follow-up questions.

This summary was generated with AI and may contain some inaccuracies.