WEST PHARMACEUTICAL SERVICES INC — Call Transcript 2026

Welcome to West's first quarter earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there'll be a question and answer session. Instructions will be given at that time. Please note today's call is being recorded. I would like to turn the call over to John Sweeney, Vice President of Investor Relations. Please go ahead. Good morning and welcome to West's first quarter 2026 earnings conference call, which has been webcast live. With me today on the call are West President, CEO, and Chairman Eric Green, and West Senior Vice President and CFO Bob McMahon. Earlier today, we issued our first quarter financial results. A copy of the press release, along with today's slide presentation containing supplemental information for your reference, has been posted in the investors section of the company's website at investor.westpharma.com. Later today, a replay of the webcast will also be available in the investors section of our website. Before we begin, we'd like to remind you that statements made by management during this call and in the accompanying presentation contain forward-looking statements within the meaning of U.S. federal securities law. Please refer to the accompanying safe harbor statements in today's press release and in addition to other disclosures made by the company such as our 10-K and 10-Q regarding the risks to which the company is subject. During the call, management will also report on certain non-GAAP financial measures, including organic net sales, adjusted operating profit, adjusted operating profit margin, free cash flow, and adjusted diluted earnings per share. The accompanying disclosure statement as well as reconciliations of these non-GAAP financial measures to the most comparable financial results prepared in conformity with U.S. GAAP are provided in this morning's press release and in today's presentation materials. I will now turn the call over to our CEO, Eric Green. Eric? Thank you, John, and good morning, everyone. Thanks for joining us today. I am pleased to report the year is off to a strong start with outstanding performance in the first quarter revenues and adjusted EPS, with both metrics coming in well above our expectations. It is clear our growth strategy is delivering. First quarter revenues of $845 million were up 21% on a reported basis and 15% on an organic basis. Adjusted operating margins in the quarter were 21.4%, expanding 350 basis points as compared to prior year. Adjusted EPS came in at $2.13, up 47% compared to prior year. As announced in the press release today, due to our strong first quarter performance and the expected ongoing momentum in our business, we are increasing our revenue and adjusted EPS guidance for full year 2026. We now anticipate full year organic revenue growth back to our long-term construct of 7%-9% up from our previous guide of 5%-7% and adjusted EPS increase to the range of $8.40-$8.75. Bob will go into more detail shortly. Now let's take a closer review of each of the businesses. Starting with HVP components in our proprietary product segment, which represents 48% of our company's total net sales and continues to be the key growth driver for West. HVP components grew 23% on an organic basis in the first quarter. This growth was led by strong performance in both GLP-1 and non-GLP-1 revenues. HVP components GLP-1 revenues grew significantly and contributed 10% of total company sales, consistent with the previous quarter. While it is still early days in the adoption of orals, the trend is playing out as we expected and have previously communicated. That is, orals are expanding the market. Our view remains unchanged for long-term growth in both injectable and oral GLP-1 markets as overall adoption of these products continues to increase. We continue to believe there are a number of factors that leave us optimistic about the prospects for our GLP-1 elastomers in the future. These include the expansion of insurance coverage, FDA regulatory decisions on compounded GLP-1s, reduced drug prices, and the introduction of GLP-1s for new indications as well as next generation products. In addition, the launch of generics in several countries outside the U.S. should drive additional demand in the coming years. Non-GLP-1 HVP components revenues increased in the high teens in the quarter. This growth was driven by durable growth drivers including biologics, HVP upgrades including Annex 1, and underlying core customer demand growth. The better-than-expected HVP components performance in the quarter can be attributed to market growth and tremendous execution of our operating unit strategy and scaling up production, particularly in Europe. Recently, I met with our team in Eschweiler, Germany, to see firsthand the operational improvements that we are leveraging across our HVP components manufacturing sites. There are three key aspects to this operational excellence initiative. First, we accelerated the process of onboarding new employees in the second half of 2025, which benefited production this quarter, and further increased output by temporarily redeploying our team members from other European sites. Second, we continue to optimize our global network. This includes working with our customers to qualify second sites, enabling us to increase production output. Third, a significant benefit of this initiative is the transfer of knowledge and implementation of best practices, which will result in ongoing enhancements throughout our global manufacturing network. Turning to our largest market, biologics. This business continues to be a strong growth driver for our HVP components business and delivered 26% organic growth. We continue to have strong win rates for biologics entering the market with solid growth for NovaPure, which is increasingly being selected for its attributes and quality by customers who are bringing new biologics to market. We're also benefiting from many biosimilar launches. Growth in this market is being increased by easing regulations and reduced testing requirements. When a biosimilar is introduced, it usually results in expansion of therapy use. This generally allows us to maintain or even increase overall volume demand after biosimilars are commercialized. We see a continued ramp in HVP conversion in Annex 1. We are experiencing strong conversion of Standard Products into HVP components, and this mix shift is improving revenue and margin performance. We continue to have strong growth in Annex 1 related projects, which increased sequentially and is up 66% as compared to this time last year. Annex 1 is anticipated to be a multi-year tailwind to our business with an expected revenue growth contribution of 200 basis points in 2026 from Annex 1 and HVP conversion. Moving on to our HVP Delivery Devices, which comprises 15% of company revenues. We delivered strong organic growth in the quarter, up 28% compared to prior year. This was driven by an increase in SmartDose 3.5 revenues, which were requested in advance of the transaction, which we continue to expect to close mid-year. The non-SmartDose parts of the business represent more than half of the revenues and were up double digits in the quarter, led by SelfDose and Crystal Zenith. Standard Products, which represents 19% of our business, were up 0.5% on an organic basis during the first quarter. Standard Products are an important funnel as they convert to HVP components over time, which provides value to our customers and generates incremental revenue for us. Turning now to West Vantage, the new brand name for our contract manufacturing segment, which represents 18% of our business. Revenues increased 6% organically in the first quarter. I was in Ireland a couple weeks ago to participate in the official opening of our new Dublin West Vantage site, which is now fully operational and producing commercial product. This milestone marks a significant step forward in strengthening our global capabilities. The site incorporates our drug handling business, which is more profitable and less capital intensive than our legacy contract manufacturing. While we are in the early stages in building our drug handling business, to date, this business is meeting our expectations. The site also supports growing customer demand for high volume injectable therapies, including treatments for diabetes and obesity. These aspects reinforce West's role as a critical partner in helping to secure patient access to these essential medicines. Now I'd like to turn the call over to Bob to discuss the financials and guidance in more detail. Bob? Thanks, Eric, and good morning, everyone. This morning I'll provide some additional details on Q1 revenue and take you through the income statement and some other key financial metrics. I'll then cover our updated full year and second quarter guidance. As Eric mentioned, we had a great start to the year as revenues of $845 million increased 21% on a reported basis and grew 15.3% organically, exceeding our expectations. The performance was broad-based as all segments were better than expected, and price contributed 3.5 percentage points of growth in the quarter. Our HVP components business was a standout, delivering $409 million in revenue and growing 22.6% organically. This was driven by robust growth in GLP-1s, HVP upgrades, including Annex 1, and overall continued improving performance in biologics revenues. As Eric mentioned, our team is executing at a high level and ramping capacity faster than planned, while demand continues to be strong. Our GLP-1 HVP components business had another very good quarter of growth, and we expect continued growth throughout the rest of the year for all the reasons that we've previously talked about. The HVP components business outside of GLP-1s accelerated nicely, growing in the high teens in the quarter and contributed over two-thirds of the HVP outperformance in the quarter. In HVP delivery devices, revenues were $124 million in the quarter and up 27.5% year-on-year organically. This was driven by growth in SmartDose 3.5 as revenues increased in anticipation of the expected midyear closing of the transaction, as well as good performance in Crystal Zenith and SelfDose. In Standard Products, revenues of $161 million were up 0.5% on an organic basis, partially driven by Annex 1 related conversion to HVP components. Our West Vantage segment delivered $151 million in revenue, growing 6.2% on an organic basis. Segment performance in the quarter was driven by an increase in sales of self-injected devices for obesity and diabetes. Now let's take a closer look at the rest of the P&L. Total company gross margin was 35.1% in the quarter, up 190 basis points year-over-year. The year-on-year increase is primarily driven by the positive mix shift of HVP components and price contribution. We did not see commodity costs have a material impact on our Q1 results. I also wanted to highlight that our West Vantage gross margin, while down slightly year-over-year as we ramp our Dublin facility, recovered sequentially as expected. Adjusted operating margins of 21.4% were 350 basis points up compared to the prior year, driven by the gross margin expansion and leveraging our SG&A and R&D across a higher revenue base. Below the line, net interest income was in line with our expectations, while our tax rate was a better-than-expected 18.3% for the quarter, and we had 72.4 million diluted shares outstanding. Now adding it all up, Q1 adjusted earnings per share were $2.13, up 47% versus last year and up 45% above the midpoint of the guidance we gave on the last earnings call. Now, before moving into our updated 2026 guidance, I did want to highlight a few other additional financial metrics. In the quarter, we delivered operating cash flow of $90 million. While down year-on-year due to the increase in AR related to our strong sales performance and the 2025 bonus payout, it was ahead of our expectations. Capital expenditures were $43 million, down from $71 million in the prior year, as we continue to drive a focus on increased capital spending efficiency. We remain on track with our expectations of $250 million-$275 million for the year, even as we increase our revenue guidance, which I'll talk about shortly. In addition, during the quarter, the board of directors authorized a new $1 billion share repurchase program, given our strong financial position. In Q1, we repurchased 1.2 million shares for $298 million and paid out $16 million in dividends as an additional means of returning capital to shareholders. Our cash flow and strong balance sheet position us well as we look to deploy capital for growth and deliver value to shareholders. We ended the first quarter with $521 million in cash on our balance sheet. In summary, we had a very good first quarter that exceeded our expectations, and the momentum we saw coming into the year is continuing. Now let me turn to our updated guidance. Before getting into the numbers, I want to highlight a few important factors driving our outlook. The macro environment continues to be dynamic, and so we will remain prudent with our forecasting given we have three quarters to go in the year. Most importantly, we've increased our growth expectations for the injectable market, driven by the underlying trends Eric talked about earlier. HVP components, both GLP-1 and non-GLP-1s, are the primary driver for our increased outlook. Our assumptions around the GLP-1 market continue to hold, and the non-GLP-1 market continues to improve. We've also incorporated rising oil and commodity prices into our updated thinking and are working to offset these costs through various means as we have with tariffs and other inflationary costs. We expect to have a net impact of single-digit millions after the mitigation efforts. Importantly, our operations and supply chain have not been affected. We continue to expect to close the SmartDose transaction mid-year. As a reminder, we generated $55 million in SmartDose sales in the second half of 2025 and have adjusted our full year 2026 expected organic growth rate to account for these revenues. For the year, we now anticipate revenue to be in the range of $3.295 billion-$3.35 billion, up $78 million at the midpoint. This reflects an increased organic revenue growth range of 7%-9% for the year. Reported growth is 7.2%-9.0% with our assumptions around FX and the SmartDose divestiture unchanged and roughly offsetting. The increase reflects strong Q1 performance and an improving demand environment for the remainder of the year. In the proprietary segment, we expect HVP components to continue to be the primary driver of revenue growth. We now anticipate this business to grow low to mid-teens organically for the year, accounting for about seven points of the total company growth at the midpoint of guidance. This is up from our previous expectation of roughly five points of total company growth at the midpoint. Importantly, both GLP-1 and non-GLP-1s are contributing. Non-GLP-1 HVP components are expected to grow low double digits and make up just over 5 points of total company growth, while GLP-1 HVP components is expected to be in the mid- to high teens. We also expect better performance in our HVP delivery devices while our expectations for Standard Products in West Vantage are consistent with our previous guidance. The positive revenue mix is helping us to further expand our margins even as we see increased costs, and we have incorporated some below the line contributions in the updated guidance. To help with your models, we are now projecting $7 million in net interest income, a 19% tax rate for the full year, and roughly 71.5 million diluted shares outstanding for the full year. This results in an adjusted earnings per share to be between $8.40 to $8.75 for the year, up 15%-20% year-over-year. Now for the second quarter, we expect revenue to be in the range of $830 million-$850 million. This is a reported increase of 8.3%-10.9% and an organic increase of 7.0%-9.6%. We expect second quarter adjusted diluted earnings per share in the range of $2.05-$2.12, up 11.4%-15.2% year-over-year. In summary, we're very pleased with how our business is performing, driven by key growth drivers, and are optimistic about the future. Now I'd like to turn the call back over to Eric for some closing comments. Eric? Thank you, Bob. To summarize, the broad-based nature of the results we reported today continues to reaffirm that our growth strategy is working as expected. We have a strong, resilient business which delivers unique value to our customers. We remain focused on our critical growth drivers of biologics, GLP-1s, Annex 1, and other HVP conversion and leveraging our global infrastructure. For the long term, many durable macro trends underpin West's growth trajectory as the global market leader in the injectable medicine space. Finally, I want to thank our team members for their commitment and relentless focus to serving our customers, which allowed us to achieve these strong results. Operator, we're ready to take questions. Thank you. Thank you. If you'd like to ask a question, please press star one one. If your question has been answered and you'd like to remove yourself from the queue, press star one one again. We ask that you please limit yourself to one question. Our first question comes from Patrick Donnelly with Citi. Your line is open. Hey, guys. Good morning. Maybe one on the non-GLPs. Nice results there in particular. Can you talk about the acceleration you saw there? It sounds like, Bob, I think you were talking about low double digits for the rest of the year on non-GLPs. Can you just talk about what you're seeing? Is it Annex 1? Is it biosimilars, biologics? Would love you to just break that down a bit more because, again, the growth there was pretty notable. Yeah, Patrick, good morning, and thank you for the question. I think as we look at the HVP non-GLP-1 area of our business around the components, we're really pleased on how the market demands continue to increase, particularly in biologics and biosimilars. We mentioned that we grew 26%. We believe for the balance of the year, we'll have very strong double digits in that area. This is mostly on already commercialized drugs in the marketplace. While we do continue to have a very high win rate on new launches and new molecules being approved, most of the growth is coming from the commercialized drugs. Annex 1, as you asked about that particular area, that continues to meet our expectations. We've seen a sequential improvement over the prior quarter, and it's up 66% over the first quarter of last year in the number of projects that we have taken on. This is actually, as you think about it, volume doesn't change, but the ASP and the margins do improve, and we'll continue to focus on that area. That is actually expanding as we think about it's not just EU regulations. We're starting to hear more about the expectations outside of Europe, particularly in the U.S. and also in Asia. I think the last area I want to just comment on, and that's why we have confidence in our guidance, is really unleashing some of our operational excellence in our HVP manufacturing sites. The work that we're doing in Europe is fungible, transferable to other sites, which will give us the ability to leverage existing capacity, higher throughput, higher output to be able to meet the rise in demand of our customers. Bob, would you like to add? Yeah, I would just say, Patrick, and thank you for the question. As you see, this is a continuation of what we saw in the second half of the year with this real continued momentum in the HVP non-GLP-1 components business. To Eric's point, what we've seen is a real combination of not only demand, the benefit of the positive mix associated with upgrading to Annex 1, and we expect both of those things to continue, as well as the continued market development of the biologics business. Feel very good about where that direction is going. If you recall, in Q4, we talked about demand outstripping supply. We're continuing to ramp and feel good about the team's ability to continue to meet that demand for the rest of the year. Okay, that's helpful. Bob, maybe on the margin side, obviously when HVPs are growing 23%, it helps on the mix side. Can you just talk about how we should think about the margins for the rest of the year between the mix shift piece? You mentioned the manufacturing excellence there. I know the footprint is an area for help. It doesn't sound like the commodity side is going to be much of a negative offset. Maybe just talk about the moving pieces there. Again, obviously, the mix shift is helping quite a bit here. Yeah. What I would say is mix shift certainly does help, but we're also being benefited from the great operational execution by the team, which helps absorb the plant costs and so forth. If we think about where we were in Q1 at 21.4% margin, that was a significant improvement over last year. Q2 will probably be roughly in that line, and then second half will keep despite increased costs, our expectation is that we- Ladies and gentlemen, please stand by. Your conference call will resume momentarily. Again, please stand by. Your conference call will resume momentarily. Hi, Patrick. Hi, this is Bob. Sorry, we got disconnected. Let me finish my thought. As I was saying, Yeah, you were about to talk about the second half, I think, when you dropped there. Yeah, exactly. That wasn't a dramatic pause. I apologize to the folks on the call. What we're expecting, actually, in the second half of the year is an extension or an expansion of our margins despite the incremental costs associated with higher fuel and logistics costs. Some of that's a benefit of continued margin mix and strong performance on the revenue side. If we look at our full year, from last guide to this guide, probably another 50 basis points improvement year-over-year. A very nice expansion. Okay. Very helpful. Thanks so much. Thank you. Our next question comes from Michael Ryskin with Bank of America. Your line is open. Great. Thanks for taking the question. Obviously, congrats on the quarter and the guide. I'm just curious, did you notice anything unusual in terms of ordering patterns or acceptance from customers? We're just wondering, maybe as a result of the Middle East crisis and the spike in oil, if any of your customers did any pre-buying or stocking ahead of time, just in anticipation of price increase or maybe supply constraints in the second half. Just wondering if you saw any weird dynamics in March once the conflict broke out. Yeah. Hey, Mike, this is Bob. Thanks for that question. I'm glad you brought that up because we've actually done a lot of analysis on our results, and we did not see any pull forward associated with the conflict in the Middle East. As we mentioned in the call, we did have greater than expected revenue associated with SmartDose 3.5, but that's a result of in anticipation of the transaction. There was no pull forward associated with the conflict. All right. That's very straightforward. Thanks. I guess kind of just staying on the same topic. You mentioned some of the offsets and some of the mitigation you're putting in as a result of that. I was wondering if you could talk through that, like whether it's price increases. I know you guys have a hedge on oil. You called that out on the Q. Could you talk about that? Could you talk about, I think that's only a couple of months worth, but anticipation of price increases in the second half, maybe some supply chain moving around, just sort of how you're adjusting to that and how that's going to play out. Related to that- Yeah, thanks, Mike. Yeah. What I would say is we have multiple tools at our disposal. Certainly, we do hedge a portion of our costs associated with that, but that certainly is not going to be the only way that we have the ability to mitigate. Similar to what we have done with tariffs and so forth, we'll look at multiple tools. Probably premature to kind of explain all the details there, but we feel good about our ability to recover a portion of those costs. All right. Thanks. I'll leave it there. Thank you. Our next question comes from Paul Knight with KeyBanc. Your line is open. Hi, Eric. A lot of this quarter sounds like capacity coming online for West. My question is around, are there any bottlenecks that you see right now? Second, how easy is it for customers to move from one site or use another site's capacity? Does it take a month, a year, to get that qualification done? Yeah, Paul, it's a multi-step process. First of all, on the capacity expansion, the teams have done a great job to unlock additional capacity utilization of existing facilities, and this initiative we launched in the second half of last year. We saw the benefits in Q1, and we'll continue to see that throughout the year. Higher throughput on existing capacity. We will always continue to layer in new capital equipment to be able to continuously expand basically around the HVP finishing processing, which really is being fueled by the Annex 1 transition. You're absolutely correct. The second lever that we're working with certain customers is qualifying multi-sites. That process does take time. It could be anywhere between 6-12 months for a transfer to occur effectively in another site to be validated. That's ongoing, and we'll continue to leverage that across our network so we can level load more effectively. I would say that's additional benefit we will see throughout 2026 going into 2027. Yeah. Hey, Paul, this is Bob. Just the other thing that Eric mentioned that I want to reiterate is around taking the learnings and the application of what we're doing in Europe and applying it to other plants, particularly our HVP plants, to be able to get ahead of some of the continued demand. Not only are we doing the things that Eric was just talking about which will help us not only in the long term. In the near term, we're being able to leverage the existing assets that we have. Real nice work by the team. Thank you. Thank you. Our next question comes from Matthew Larew with William Blair. Your line is open. Matthew Larew with William Blair, your line is open. If your telephone's muted, please unmute. Okay, we'll go to our next question, which comes from Kallum Titchmarsh with Morgan Stanley. Your line is open. Great. Thanks for taking the question, guys. Maybe just following up a bit more on Annex 1, and just checking in on the flow of new customer conversations and conversions there. Any refreshed view on the duration of this tailwind, whether customers are maybe facing issues for not upgrading their components and just how to think about what can be realistically captured from the TAM you framed up before? Yeah, Kallum, this area of opportunity for us is actually very attractive, and we're gaining momentum. What we're seeing right now is the number of projects our customers we're engaged with has increased and continues to increase. We're able to convert from a project status to commercialized product going into the market. I'm very pleased on the progress that we're making on both fronts. The conversations are actually more, I would say it's increasing because the regulations and our customers are looking beyond just Europe. Therefore, there's more of a pull effect on having us participate on upgrading certain products in market today on commercialized drugs really around our HVP finishing processes, which again, going back to what Bob mentioned earlier about unlocking or unleashing the opportunities to expand our capacity capabilities in our HVP plants, that's going to enable us to continue to grow nicely. The growth that we believe that we will continue to deliver on is 200 basis points per annum for multiple years. We're early innings, I would say. We've identified at least 6 billion units that are targeted to be converted, and we're early in that stage. We do think this is a very long-term growth opportunity. Kallum, just to add to what Eric's saying and to emphasize a couple of points, the regulatory environment does continue to increase across the globe, particularly focused on contamination. I think we are uniquely positioned to be able to take advantage of this given our market position on existing products. We're very optimistic about this. Appreciate it. Then I realize it's kind of less than 10% of the group, but would love to hear a bit more about the kind of underlying demand environment in APAC. Pretty strong 29% growth in Q1. Just wondering if that's being underpinned by anything notably different than your U.S. and European growth drivers, and how we should think about investment into that region in the future. Thanks a lot. Yeah, no, we continue to look at Asia Pacific as an attractive market for us geographically. We support that region in twofold. One, local for local consumption, but also export that is going to the global market. We rely heavily in other locations to be able to feed finished product into that region. I would say that we are seeing an increase, particularly in the biologics or the biosimilars space, which we continue to have a very attractive participation rate. That's actually very attractive for us as you think about leveraging our higher end of our HVP portfolio. More to come, but we're pleased with the team's execution in region to support customers. We are seeing an increase of CDMOs, small biotech firms looking to be able to branch out into the Western markets. Helpful. Thanks, guys. Thank you. Our next question comes from Justin Bowers with Deutsche Bank. Your line is open. Hi. Good morning, everyone. Eric, can you provide us with an update on the demand profile for some of the manufacturing space that you now have available in Dublin and in the West Coast? Two, just also an update on the GLP-1 market. What are you seeing in terms of other indications outside of diabetes and obesity? Are there programs growing in that part of the market as well? Yeah, Justin, you're right. Let me start with the first question you asked about the CGM business in Dublin that we'll be finishing up at the end of second quarter of this year. We're pleased with the progress we're making with new customers and contracts to be able to backfill. Once the equipment processing lines are extracted from that facility, we are going to be installing new equipment from our customers to support them on their own new commercial launches, particularly around drug handling in the non-GLP-1 area. That's an area being attracted by our customers with the West Vantage strategy and the value proposition we're bringing. I'm very pleased with the progress. More to come, but we do need to close out and finish strong on the current customer by the end of the second quarter, and then we'll do the transition in the second half with new customers. In regards to the GLP-1s, other indications other than obesity and diabetes, those are several projects in the pipeline that we're supporting. Actually, if you think about not just other indications, but other types of molecules that are being targeted for that market, we are obviously a very strong player and in the pipeline, it's very attractive. As you know, they're looking at combination molecules. They're looking at other types of biologics. We're very well-positioned, and we do think that'll be an extension of growth in that particular area for a number of years to come. Got it. Appreciate that. Just a quick follow-up. On the drug delivery device strength that you saw and the transition there, was that mostly volume driven, or was there any incentive payments there? What were sort of the contributors to the strength there? Yeah. Hey, Justin, this is Bob. Yeah, the good news is it was all volume. There weren't any incentive payments associated with that. Now, if you look at it was roughly split evenly between SmartDose and the non-SmartDose business. We feel really good about the performance going forward. Thank you. Thank you. Our next question comes from Matt Larew with William Blair. Your line is open. Matt, if your telephone is muted, please unmute. Yeah. Let's move on to the next caller, please. Thank you, operator. You're welcome. Our next question comes from Daniel Markowitz with Evercore ISI. Your line is open. Hey, guys, congrats on the results, and thank you so much for taking my questions. The first thing I wanted to ask on, the press release called out NovaPure as a positive for the first time in a while. Backing up, I think mix shift is such an awesome part of the story, and NovaPure sort of stands out as being at the high end of the high-value component segment. Really nice to see that. I just wanted to ask what sort of drove the strength there specifically? Yeah, Daniel. Excuse me. That's driven by market demand of commercialized molecules in market already. While we are continuing to see a number of new approvals in the pipeline, we're feeding it with NovaPure, but that particular growth that you're seeing, and we expect biologics to continue to grow quite nicely throughout 2026, is being fueled by NovaPure. Yeah. It was one of the several highlights in the quarter, Daniel, and we feel good about the ongoing momentum there going forward. We had very nice growth in NovaPure year-over-year. Great. Thank you. Just a follow-up. As I look at the full-year guide after a really strong first quarter and a nice Q2 guide, the full year now looks more first half-weighted versus what's typical. Is there anything to call out that's causing a decel in the back half, or is this more conservatism? Thanks, guys. Yeah. Thanks. I'm glad you brought that up, Daniel. A couple of things. One is we are at the beginning of the year, so we are prudent. We're taking it one quarter at a time. We do have the roll-off of the CGM contract in the back half of the year. That is, as a reminder, is about a $40 million headwind in the second half of the year. That's no change from the original guidance that we had provided, and that also comes into play. What I would say is we're prudent with our guidance and feel good about the ongoing momentum of the business. Great. Thank you, and congrats again. Thank you. Thank you. Our next question comes from David Windley with Jefferies. Your line is open. Hi. Good morning. Thanks for taking my question. I wanted to ask Eric about, or maybe Bob too, about incremental margin. As good as margin expansion is year-over-year. I guess I would come at it from the standpoint of still seems like there's quite a bit of opportunity there. Looking back on the model revenue, looked to be at a record level. You're rebalancing capacity to open up some new capacity. The NovaPure callout by Daniel, there's a number of factors that seem positive. Margin was better year-over-year, but down sequentially. I'm wondering if there were issues like the labor ramp-up that you mentioned, burden from commodity costs, or perhaps the weight of the SmartDose volume that came through in the quarter that might have shaded what would've otherwise been even better margin. Could you flesh that out for us? Yeah, David, that's a good question, and let me start, and then I'm going to turn it over to Bob, but I think you've hit on the key points. We believe the HVP components business will continue to drive margin expansion. As we think about the biologics business continuing to grow, you're absolutely correct by pointing out NovaPure and the strength of that particular business which drives a very attractive margin expansion. We also have the continuation of the Annex 1, and that's a multi-year journey. As you know, we're basically moving an existing product in the market from a standard core level to a HVP, which brings very attractive margin expansion. I don't want to underestimate the impact of leveraging our HVP sites more effectively with operational excellence. We've learned a lot in the first quarter. There's more to be done and also spread to our other sites, which we've actually seen as we went to those sites a few weeks ago. We're very optimistic that we will be able to get more out of the existing capital that's in place today to produce HVP. I do agree that there is opportunity for further margin expansion based on the HVP components. Bob, do you want to add? Yeah. David, just a couple of other pieces of data. You're right. If we think about Q1, we were ramping throughout the course of the year, so the March had a much better performance than January. That'll continue to expand as we go through the rest of the year, as those individuals were ramping up from a capacity standpoint. We did have a very good incremental, but I think it can be better. SmartDose did have some impact on that. Obviously, to the earlier question around quarterly cadence, that's one of the reasons the second half of the year, we expect on our operating margin basis to be pretty heftily above where we are in the first half of the year. A number of, I would say, positive opportunities for us to continue to expand margin, not only this year, but going into next year as well. Great. Thanks. If I could just quickly follow up, Eric, I'd like to believe, based on my own age, that you're still a pretty young chicken. You've made the decision to retire. Could you talk to us about that, please? David, thanks for that. I'm pleased that you recognize that I'm still young. I feel it. Look, I think this is an outstanding organization, a lot of legacy, but a great future ahead of us, and I'm very proud of how the team's operating. I'm extremely proud of the executive team that we put in place, one of them sitting next to me right now. I do think this team is performing at a very high level, and will continue to do so. The business is operating very well. The strategy is very clear. The global leadership team is aligned and executing. As I think about the successor coming in, when appointed, we'll be in a very good position to continue to take this business forward. I'm excited about where we are at West, but I'm more excited about the future. I couldn't be more proud about the team across the globe and how they are executing today, but more important, the future of this business. Thank you, and congrats. Thank you. Thank you. Our next question comes from Larry Solow with CJS Securities. Your line is open. Great. Thanks. Congrats on the quarter as well. Just to follow up on Dave's question there, Eric, we're going to miss you. It sounds like nothing imminent, but just curious how the search is going. Any kind of high-level timelines you can share with us or any thoughts there? Yeah. Larry, thank you. We are active in the market as we speak. We anticipate that my successor will be appointed in the second half of this year. We'll keep you informed as we make progress, but, again, as I've mentioned earlier with David's question, this is an unbelievable company, and I think it's going to be. Once we have somebody appointed, we'll be in a very good position. Yeah, absolutely. You've done a great job enhancing the company dialogue too, for sure. Just a couple follow-up questions. You mentioned NovaPure. Most of the growth there has been driven by current products in the market. Just curious on the Annex 1, what folks are kind of shifting it towards. Is it more towards the lower end of the curve there, like the Westar, and then maybe as you go up a little more on the Fluorotec side? Or do you see some of these 6 billion potential components, some of them eventually even converting to some of the higher level of value services there? Larry, it's going to be a mixed answer for you. It really depends on the customer and the molecule itself. You're right. I would say if you look at a weighted average, more so around the Westar, and then leveraging Envision, pharmaceutical washing, sterilization. We do have a few cases where they're going all the way up to the high end of the spectrum of HVP. It is more about the midpoint of that portfolio. As a reminder, many of them are starting off at the standard legacy product. Again, either case is very positive. We do also have some shift from the lower end of HVP going to the higher end. It's a combination of both. Mm-hmm. I gave you kind of a wide spectrum answer there, but that's why it's exciting. It's leveraging our global HVP finishing processes. Got you. Just quickly, if I may, just one last one. Just on the West Vantage, I guess you're calling that now. I guess the cadence should we expect for the rest of the year, do we expect a little bit of a dip? You had obviously a really nice strong quarter towards the middle back end of the year as the rest of the continuous glucose so that next piece comes out, and then sort of a rebuild in 2027. Along those lines, how should we view the margin profile of the segment as we go out in the next couple of years? Thanks. Yeah. Hey, Larry, I'll take that question. You're right, there is a kind of front half weighting associated with that, just given what we were talking about before with the CGM contract exiting. Our forecast for the year remains unchanged at roughly flat. It'll be up in the first half and then maybe slightly down. Q3, I would expect to be the trough, because if you remember, the drug handling is kind of ramping up throughout the year. As Eric mentioned, it's on track. That's $20 million of incremental revenue. Most of that will be in the back half of the year. As we've talked about, the benefit of that drug handling is that's a higher margin business than what it's replacing. From a margin profile, I would expect margin profile to be roughly consistent across the year. Got it. Okay. Eventually, does the drug handling have a higher margin as you build that out? Yes. Okay. Yeah. The drug handling margin, and it's important, two other things. The drug handling business, while it has $20 million this year, that is certainly not at ramp. At peak, it's probably- Right. Three times that much, which we'll continue to see ramp throughout 2027. From a margin perspective, it's at least twice as much on a gross margin basis. Okay. As our current business. Got you. That's perfect follow-up. Great. Thank you. I appreciate that, Bob. Thank you. Our next question comes from Brendan Smith with TD Cowen. Your line is open. Hey, guys. Great print. In terms of the 200 basis point growth contribution related to Annex 1, is most of that baking in Europe-based upgrades? Are you seeing any customers upgrade? You mentioned the U.S. and Asia as next logical geographies, but are you seeing any customers upgrade in parallel? Could that present any upside to that current expectation? Please stand by. Michelle, can you hear us? Yes. Okay. Can you put us in? You're on. Go ahead. Okay. Yeah. In terms of the 200 basis point growth contribution related to Annex 1, you mentioned the U.S. and Asia as next sort of subsequent geographies seeing upgrades. Is the current expectation baking in pretty much just Europe, or are you seeing any customers upgrade in parallel across geographies, and could that represent some upside opportunity there? Yeah. There's two factors that are happening, Brendan. Good question. One is, our customers that are looking to upgrade for the European market are also looking at their portfolio and making more global decisions and being consistent. We are seeing that as one factor. Another factor we are seeing, we're being brought into conversations with our customers, even in the United States, with the FDA making observations around sterility and the strategy around other manufacturing processes, and therefore there's opportunity to upgrade even in the U.S. market. We're seeing a factor of both, and we'll see how this plays out in the near term, and that might be a potential opportunity. Brendan, I think the other thing to think about is a potential accelerant here is as we think about all the work that's happening from the on-shoring standpoint. A lot of that is actually coming from Europe into the U.S., and what our pharma customers are wanting to do is standardize on a consistent product and process. That hasn't been fully baked in, because a lot of that work is still ongoing, but that has the potential to kind of accelerate and expand our Annex 1 opportunities well beyond Europe. That's great. In terms of the operational excellence plan, can you speak to maybe, like, a cadence of executing that across sites or some timelines? And are those improvements baked into the raised guidance? Thanks for the questions. Yeah, the cadence is we're live right now. We're actually transferring some of the learnings and knowledge into other sites, and particularly in Kinston and Jersey Shore, outside of our Eschweiler and Waterford plants. That is in process, and that will continue to occur throughout the year. As Bob alluded that we saw a nice margin expansion within the quarter because of these efforts. We are still in the build-up mode. We should see the expectations of additional benefits throughout the next several quarters. Yeah. We have baked some of that operational improvement in the forecast. Thank you. Our next question comes from Thomas DeBourcy with Nephron Research. Your line is open. Hi, guys. Thanks for taking the question. I was just wondering on HVP delivery devices and, I guess, post the divestiture of SmartDose 3.5 milliliters, just how you think about that business. I know you have the Securi platform and how you think about, I guess, adding to that portfolio and whether that's still obviously, I guess, a core part of your offering to customers. Yeah. No, absolutely. Within that portfolio, we have administrative systems, which is a very attractive market that continues to expand and grow, particularly in the hospital market. We have the Crystal Zenith, which is a containment alternative to glass that is really targeted to the highest end of biologics and cell and gene therapy. You have the other alternative delivery devices like SelfDose that the demand and volumes are continuing to increase. We have other versions in volume doses that we're able to offer our market. We believe delivery devices is natural in this area as primary containment is a natural extension from our elastomer business. We'll continue to invest around new product development, and manufacturing capacity expansion because it's a very attractive growth profile and a margin opportunity. Great. Thanks. Thank you. Thank you. I'm showing no further questions at this time. I'd like to turn the call back over to John Sweeney for closing remarks. Thank you very much for joining us today on our first quarter 2026 earnings conference call. We look forward to updating you as we move through the year. Thanks very much and have a good day. Thank you for your participation. You may now disconnect. Everyone, have a great day.

Speaker 11: Welcome to West's first quarter earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there'll be a question and answer session. Instructions will be given at that time. Please note today's call is being recorded. I would like to turn the call over to John Sweeney, Vice President of Investor Relations. Please go ahead. Welcome to West's first quarter earnings conference call. welcome to west's first quarter earnings conference call At this time, all participants are in listen-only mode. at this time all participants are in listen-only mode After the speaker's presentation, there'll be a question and answer session. after the speaker's presentation there'll be a question and answer session Instructions will be given at that time. instructions will be given at that time Please note today's call is being recorded. please note today's call is being recorded I would like to turn the call over to John Sweeney, Vice President of Investor Relations. i would like to turn the call over to john sweeney vice president of investor relations Please go ahead. please go ahead

Speaker 6: Good morning and welcome to West's first quarter 2026 earnings conference call, which has been webcast live. With me today on the call are West President, CEO, and Chairman Eric Green, and West Senior Vice President and CFO Bob McMahon. Earlier today, we issued our first quarter financial results. A copy of the press release, along with today's slide presentation containing supplemental information for your reference, has been posted in the investors section of the company's website at investor.westpharma.com. Later today, a replay of the webcast will also be available in the investors section of our website. Before we begin, we'd like to remind you that statements made by management during this call and in the accompanying presentation contain forward-looking statements within the meaning of U.S. federal securities law. Good morning and welcome to West's first quarter 2026 earnings conference call, which has been webcast live. good morning and welcome to west's first quarter 2026 earnings conference call which has been webcast live With me today on the call are West President, CEO, and Chairman Eric Green, and West Senior Vice President and CFO Bob McMahon. with me today on the call are west president ceo and chairman eric green and west senior vice president and cfo bob mcmahon Earlier today, we issued our first quarter financial results. earlier today we issued our first quarter financial results A copy of the press release, along with today's slide presentation containing supplemental information for your reference, has been posted in the investors section of the company's website at investor.westpharma.com. a copy of the press release along with today's slide presentation containing supplemental information for your reference has been posted in the investors section of the company's website at investor.westpharma.com Later today, a replay of the webcast will also be available in the investors section of our website. later today a replay of the webcast will also be available in the investors section of our website Before we begin, we'd like to remind you that statements made by management during this call and in the accompanying presentation contain forward-looking statements within the meaning of U.S. federal securities law. before we begin we'd like to remind you that statements made by management during this call and in the accompanying presentation contain forward-looking statements within the meaning of u.s federal securities law Please refer to the accompanying safe harbor statements in today's press release and in addition to other disclosures made by the company such as our 10-K and 10-Q regarding the risks to which the company is subject. During the call, management will also report on certain non-GAAP financial measures, including organic net sales, adjusted operating profit, adjusted operating profit margin, free cash flow, and adjusted diluted earnings per share. The accompanying disclosure statement as well as reconciliations of these non-GAAP financial measures to the most comparable financial results prepared in conformity with U.S. GAAP are provided in this morning's press release and in today's presentation materials. I will now turn the call over to our CEO, Eric Green. Eric? Please refer to the accompanying safe harbor statements in today's press release and in addition to other disclosures made by the company such as our 10-K and 10-Q regarding the risks to which the company is subject. please refer to the accompanying safe harbor statements in today's press release and in addition to other disclosures made by the company such as our 10-k and 10-q regarding the risks to which the company is subject During the call, management will also report on certain non-GAAP financial measures, including organic net sales, adjusted operating profit, adjusted operating profit margin, free cash flow, and adjusted diluted earnings per share. during the call management will also report on certain non-gaap financial measures including organic net sales adjusted operating profit adjusted operating profit margin free cash flow and adjusted diluted earnings per share The accompanying disclosure statement as well as reconciliations of these non-GAAP financial measures to the most comparable financial results prepared in conformity with U.S. the accompanying disclosure statement as well as reconciliations of these non-gaap financial measures to the most comparable financial results prepared in conformity with u.s GAAP are provided in this morning's press release and in today's presentation materials. gaap are provided in this morning's press release and in today's presentation materials I will now turn the call over to our CEO, Eric Green. i will now turn the call over to our ceo eric green Eric? eric

Speaker 5: Thank you, John, and good morning, everyone. Thanks for joining us today. I am pleased to report the year is off to a strong start with outstanding performance in the first quarter revenues and adjusted EPS, with both metrics coming in well above our expectations. It is clear our growth strategy is delivering. First quarter revenues of $845 million were up 21% on a reported basis and 15% on an organic basis. Adjusted operating margins in the quarter were 21.4%, expanding 350 basis points as compared to prior year. Adjusted EPS came in at $2.13, up 47% compared to prior year. Thank you, John, and good morning, everyone. thank you john and good morning everyone Thanks for joining us today. thanks for joining us today I am pleased to report the year is off to a strong start with outstanding performance in the first quarter revenues and adjusted EPS, with both metrics coming in well above our expectations. i am pleased to report the year is off to a strong start with outstanding performance in the first quarter revenues and adjusted eps with both metrics coming in well above our expectations It is clear our growth strategy is delivering. it is clear our growth strategy is delivering First quarter revenues of $845 million were up 21% on a reported basis and 15% on an organic basis. first quarter revenues of $845 million were up 21% on a reported basis and 15% on an organic basis Adjusted operating margins in the quarter were 21.4%, expanding 350 basis points as compared to prior year. adjusted operating margins in the quarter were 21.4% expanding 350 basis points as compared to prior year Adjusted EPS came in at $2.13, up 47% compared to prior year. adjusted eps came in at $2.13 up 47% compared to prior year As announced in the press release today, due to our strong first quarter performance and the expected ongoing momentum in our business, we are increasing our revenue and adjusted EPS guidance for full year 2026. We now anticipate full year organic revenue growth back to our long-term construct of 7%-9% up from our previous guide of 5%-7% and adjusted EPS increase to the range of $8.40-$8.75. Bob will go into more detail shortly. Now let's take a closer review of each of the businesses. Starting with HVP components in our proprietary product segment, which represents 48% of our company's total net sales and continues to be the key growth driver for West. HVP components grew 23% on an organic basis in the first quarter. As announced in the press release today, due to our strong first quarter performance and the expected ongoing momentum in our business, we are increasing our revenue and adjusted EPS guidance for full year 2026. as announced in the press release today due to our strong first quarter performance and the expected ongoing momentum in our business we are increasing our revenue and adjusted eps guidance for full year 2026 We now anticipate full year organic revenue growth back to our long-term construct of 7%-9% up from our previous guide of 5%-7% and adjusted EPS increase to the range of $8.40-$8.75. we now anticipate full year organic revenue growth back to our long-term construct of 7%-9% up from our previous guide of 5%-7% and adjusted eps increase to the range of $8.40-$8.75 Bob will go into more detail shortly. bob will go into more detail shortly Now let's take a closer review of each of the businesses. now let's take a closer review of each of the businesses Starting with HVP components in our proprietary product segment, which represents 48% of our company's total net sales and continues to be the key growth driver for West. starting with hvp components in our proprietary product segment which represents 48% of our company's total net sales and continues to be the key growth driver for west HVP components grew 23% on an organic basis in the first quarter. hvp components grew 23% on an organic basis in the first quarter This growth was led by strong performance in both GLP-1 and non-GLP-1 revenues. HVP components GLP-1 revenues grew significantly and contributed 10% of total company sales, consistent with the previous quarter. While it is still early days in the adoption of orals, the trend is playing out as we expected and have previously communicated. That is, orals are expanding the market. Our view remains unchanged for long-term growth in both injectable and oral GLP-1 markets as overall adoption of these products continues to increase. We continue to believe there are a number of factors that leave us optimistic about the prospects for our GLP-1 elastomers in the future. These include the expansion of insurance coverage, FDA regulatory decisions on compounded GLP-1s, reduced drug prices, and the introduction of GLP-1s for new indications as well as next generation products. This growth was led by strong performance in both GLP-1 and non-GLP-1 revenues. this growth was led by strong performance in both glp-1 and non-glp-1 revenues HVP components GLP-1 revenues grew significantly and contributed 10% of total company sales, consistent with the previous quarter. hvp components glp-1 revenues grew significantly and contributed 10% of total company sales consistent with the previous quarter While it is still early days in the adoption of orals, the trend is playing out as we expected and have previously communicated. while it is still early days in the adoption of orals the trend is playing out as we expected and have previously communicated That is, orals are expanding the market. that is orals are expanding the market Our view remains unchanged for long-term growth in both injectable and oral GLP-1 markets as overall adoption of these products continues to increase. our view remains unchanged for long-term growth in both injectable and oral glp-1 markets as overall adoption of these products continues to increase We continue to believe there are a number of factors that leave us optimistic about the prospects for our GLP-1 elastomers in the future. we continue to believe there are a number of factors that leave us optimistic about the prospects for our glp-1 elastomers in the future These include the expansion of insurance coverage, FDA regulatory decisions on compounded GLP-1s, reduced drug prices, and the introduction of GLP-1s for new indications as well as next generation products. these include the expansion of insurance coverage fda regulatory decisions on compounded glp-1s reduced drug prices and the introduction of glp-1s for new indications as well as next generation products In addition, the launch of generics in several countries outside the U.S. should drive additional demand in the coming years. Non-GLP-1 HVP components revenues increased in the high teens in the quarter. This growth was driven by durable growth drivers including biologics, HVP upgrades including Annex 1, and underlying core customer demand growth. The better-than-expected HVP components performance in the quarter can be attributed to market growth and tremendous execution of our operating unit strategy and scaling up production, particularly in Europe. In addition, the launch of generics in several countries outside the U.S. should drive additional demand in the coming years. in addition the launch of generics in several countries outside the u.s should drive additional demand in the coming years Non-GLP-1 HVP components revenues increased in the high teens in the quarter. non-glp-1 hvp components revenues increased in the high teens in the quarter This growth was driven by durable growth drivers including biologics, HVP upgrades including Annex 1, and underlying core customer demand growth. this growth was driven by durable growth drivers including biologics hvp upgrades including annex 1 and underlying core customer demand growth The better-than-expected HVP components performance in the quarter can be attributed to market growth and tremendous execution of our operating unit strategy and scaling up production, particularly in Europe. the better-than-expected hvp components performance in the quarter can be attributed to market growth and tremendous execution of our operating unit strategy and scaling up production particularly in europe Recently, I met with our team in Eschweiler, Germany, to see firsthand the operational improvements that we are leveraging across our HVP components manufacturing sites. There are three key aspects to this operational excellence initiative. First, we accelerated the process of onboarding new employees in the second half of 2025, which benefited production this quarter, and further increased output by temporarily redeploying our team members from other European sites. Recently, I met with our team in Eschweiler, Germany, to see firsthand the operational improvements that we are leveraging across our HVP components manufacturing sites. There are three key aspects to this operational excellence initiative. recently i met with our team in eschweiler germany to see firsthand the operational improvements that we are leveraging across our hvp components manufacturing sites. there are three key aspects to this operational excellence initiative First, we accelerated the process of onboarding new employees in the second half of 2025, which benefited production this quarter, and further increased output by temporarily redeploying our team members from other European sites. first we accelerated the process of onboarding new employees in the second half of 2025 which benefited production this quarter and further increased output by temporarily redeploying our team members from other european sites Second, we continue to optimize our global network. This includes working with our customers to qualify second sites, enabling us to increase production output. Third, a significant benefit of this initiative is the transfer of knowledge and implementation of best practices, which will result in ongoing enhancements throughout our global manufacturing network. Turning to our largest market, biologics. This business continues to be a strong growth driver for our HVP components business and delivered 26% organic growth. We continue to have strong win rates for biologics entering the market with solid growth for NovaPure, which is increasingly being selected for its attributes and quality by customers who are bringing new biologics to market. We're also benefiting from many biosimilar launches. Growth in this market is being increased by easing regulations and reduced testing requirements. When a biosimilar is introduced, it usually results in expansion of therapy use. Second, we continue to optimize our global network. second we continue to optimize our global network This includes working with our customers to qualify second sites, enabling us to increase production output. this includes working with our customers to qualify second sites enabling us to increase production output Third, a significant benefit of this initiative is the transfer of knowledge and implementation of best practices, which will result in ongoing enhancements throughout our global manufacturing network. third a significant benefit of this initiative is the transfer of knowledge and implementation of best practices which will result in ongoing enhancements throughout our global manufacturing network Turning to our largest market, biologics. turning to our largest market biologics This business continues to be a strong growth driver for our HVP components business and delivered 26% organic growth. this business continues to be a strong growth driver for our hvp components business and delivered 26% organic growth We continue to have strong win rates for biologics entering the market with solid growth for NovaPure, which is increasingly being selected for its attributes and quality by customers who are bringing new biologics to market. we continue to have strong win rates for biologics entering the market with solid growth for novapure which is increasingly being selected for its attributes and quality by customers who are bringing new biologics to market We're also benefiting from many biosimilar launches. we're also benefiting from many biosimilar launches Growth in this market is being increased by easing regulations and reduced testing requirements. growth in this market is being increased by easing regulations and reduced testing requirements When a biosimilar is introduced, it usually results in expansion of therapy use. when a biosimilar is introduced it usually results in expansion of therapy use This generally allows us to maintain or even increase overall volume demand after biosimilars are commercialized. We see a continued ramp in HVP conversion in Annex 1. We are experiencing strong conversion of Standard Products into HVP components, and this mix shift is improving revenue and margin performance. We continue to have strong growth in Annex 1 related projects, which increased sequentially and is up 66% as compared to this time last year. Annex 1 is anticipated to be a multi-year tailwind to our business with an expected revenue growth contribution of 200 basis points in 2026 from Annex 1 and HVP conversion. Moving on to our HVP Delivery Devices, which comprises 15% of company revenues. We delivered strong organic growth in the quarter, up 28% compared to prior year. This generally allows us to maintain or even increase overall volume demand after biosimilars are commercialized. this generally allows us to maintain or even increase overall volume demand after biosimilars are commercialized We see a continued ramp in HVP conversion in Annex 1. we see a continued ramp in hvp conversion in annex 1 We are experiencing strong conversion of Standard Products into HVP components, and this mix shift is improving revenue and margin performance. we are experiencing strong conversion of standard products into hvp components and this mix shift is improving revenue and margin performance We continue to have strong growth in Annex 1 related projects, which increased sequentially and is up 66% as compared to this time last year. we continue to have strong growth in annex 1 related projects which increased sequentially and is up 66% as compared to this time last year Annex 1 is anticipated to be a multi-year tailwind to our business with an expected revenue growth contribution of 200 basis points in 2026 from Annex 1 and HVP conversion. annex 1 is anticipated to be a multi-year tailwind to our business with an expected revenue growth contribution of 200 basis points in 2026 from annex 1 and hvp conversion Moving on to our HVP Delivery Devices, which comprises 15% of company revenues. moving on to our hvp delivery devices which comprises 15% of company revenues We delivered strong organic growth in the quarter, up 28% compared to prior year. we delivered strong organic growth in the quarter up 28% compared to prior year This was driven by an increase in SmartDose 3.5 revenues, which were requested in advance of the transaction, which we continue to expect to close mid-year. The non-SmartDose parts of the business represent more than half of the revenues and were up double digits in the quarter, led by SelfDose and Crystal Zenith. Standard Products, which represents 19% of our business, were up 0.5% on an organic basis during the first quarter. Standard Products are an important funnel as they convert to HVP components over time, which provides value to our customers and generates incremental revenue for us. Turning now to West Vantage, the new brand name for our contract manufacturing segment, which represents 18% of our business. Revenues increased 6% organically in the first quarter. This was driven by an increase in SmartDose 3.5 revenues, which were requested in advance of the transaction, which we continue to expect to close mid-year. this was driven by an increase in smartdose 3.5 revenues which were requested in advance of the transaction which we continue to expect to close mid-year The non-SmartDose parts of the business represent more than half of the revenues and were up double digits in the quarter, led by SelfDose and Crystal Zenith. the non-smartdose parts of the business represent more than half of the revenues and were up double digits in the quarter led by selfdose and crystal zenith Standard Products, which represents 19% of our business, were up 0.5% on an organic basis during the first quarter. standard products which represents 19% of our business were up 0.5% on an organic basis during the first quarter Standard Products are an important funnel as they convert to HVP components over time, which provides value to our customers and generates incremental revenue for us. standard products are an important funnel as they convert to hvp components over time which provides value to our customers and generates incremental revenue for us Turning now to West Vantage, the new brand name for our contract manufacturing segment, which represents 18% of our business. turning now to west vantage the new brand name for our contract manufacturing segment which represents 18% of our business Revenues increased 6% organically in the first quarter. revenues increased 6% organically in the first quarter I was in Ireland a couple weeks ago to participate in the official opening of our new Dublin West Vantage site, which is now fully operational and producing commercial product. This milestone marks a significant step forward in strengthening our global capabilities. The site incorporates our drug handling business, which is more profitable and less capital intensive than our legacy contract manufacturing. While we are in the early stages in building our drug handling business, to date, this business is meeting our expectations. The site also supports growing customer demand for high volume injectable therapies, including treatments for diabetes and obesity. These aspects reinforce West's role as a critical partner in helping to secure patient access to these essential medicines. Now I'd like to turn the call over to Bob to discuss the financials and guidance in more detail. Bob? I was in Ireland a couple weeks ago to participate in the official opening of our new Dublin West Vantage site, which is now fully operational and producing commercial product. i was in ireland a couple weeks ago to participate in the official opening of our new dublin west vantage site which is now fully operational and producing commercial product This milestone marks a significant step forward in strengthening our global capabilities. this milestone marks a significant step forward in strengthening our global capabilities The site incorporates our drug handling business, which is more profitable and less capital intensive than our legacy contract manufacturing. the site incorporates our drug handling business which is more profitable and less capital intensive than our legacy contract manufacturing While we are in the early stages in building our drug handling business, to date, this business is meeting our expectations. while we are in the early stages in building our drug handling business to date this business is meeting our expectations The site also supports growing customer demand for high volume injectable therapies, including treatments for diabetes and obesity. the site also supports growing customer demand for high volume injectable therapies including treatments for diabetes and obesity These aspects reinforce West's role as a critical partner in helping to secure patient access to these essential medicines. these aspects reinforce west's role as a critical partner in helping to secure patient access to these essential medicines Now I'd like to turn the call over to Bob to discuss the financials and guidance in more detail. now i'd like to turn the call over to bob to discuss the financials and guidance in more detail Bob? bob

Speaker 1: Thanks, Eric, and good morning, everyone. This morning I'll provide some additional details on Q1 revenue and take you through the income statement and some other key financial metrics. I'll then cover our updated full year and second quarter guidance. As Eric mentioned, we had a great start to the year as revenues of $845 million increased 21% on a reported basis and grew 15.3% organically, exceeding our expectations. The performance was broad-based as all segments were better than expected, and price contributed 3.5 percentage points of growth in the quarter. Our HVP components business was a standout, delivering $409 million in revenue and growing 22.6% organically. This was driven by robust growth in GLP-1s, HVP upgrades, including Annex 1, and overall continued improving performance in biologics revenues. Thanks, Eric, and good morning, everyone. thanks eric and good morning everyone This morning I'll provide some additional details on Q1 revenue and take you through the income statement and some other key financial metrics. this morning i'll provide some additional details on q1 revenue and take you through the income statement and some other key financial metrics I'll then cover our updated full year and second quarter guidance. i'll then cover our updated full year and second quarter guidance As Eric mentioned, we had a great start to the year as revenues of $845 million increased 21% on a reported basis and grew 15.3% organically, exceeding our expectations. as eric mentioned we had a great start to the year as revenues of $845 million increased 21% on a reported basis and grew 15.3% organically exceeding our expectations The performance was broad-based as all segments were better than expected, and price contributed 3.5 percentage points of growth in the quarter. the performance was broad-based as all segments were better than expected and price contributed 3.5 percentage points of growth in the quarter Our HVP components business was a standout, delivering $409 million in revenue and growing 22.6% organically. our hvp components business was a standout delivering $409 million in revenue and growing 22.6% organically This was driven by robust growth in GLP-1s, HVP upgrades, including Annex 1, and overall continued improving performance in biologics revenues. this was driven by robust growth in glp-1s hvp upgrades including annex 1 and overall continued improving performance in biologics revenues As Eric mentioned, our team is executing at a high level and ramping capacity faster than planned, while demand continues to be strong. Our GLP-1 HVP components business had another very good quarter of growth, and we expect continued growth throughout the rest of the year for all the reasons that we've previously talked about. The HVP components business outside of GLP-1s accelerated nicely, growing in the high teens in the quarter and contributed over two-thirds of the HVP outperformance in the quarter. In HVP delivery devices, revenues were $124 million in the quarter and up 27.5% year-on-year organically. This was driven by growth in SmartDose 3.5 as revenues increased in anticipation of the expected midyear closing of the transaction, as well as good performance in Crystal Zenith and SelfDose. As Eric mentioned, our team is executing at a high level and ramping capacity faster than planned, while demand continues to be strong. as eric mentioned our team is executing at a high level and ramping capacity faster than planned while demand continues to be strong Our GLP-1 HVP components business had another very good quarter of growth, and we expect continued growth throughout the rest of the year for all the reasons that we've previously talked about. our glp-1 hvp components business had another very good quarter of growth and we expect continued growth throughout the rest of the year for all the reasons that we've previously talked about The HVP components business outside of GLP-1s accelerated nicely, growing in the high teens in the quarter and contributed over two-thirds of the HVP outperformance in the quarter. the hvp components business outside of glp-1s accelerated nicely growing in the high teens in the quarter and contributed over two-thirds of the hvp outperformance in the quarter In HVP delivery devices, revenues were $124 million in the quarter and up 27.5% year-on-year organically. in hvp delivery devices revenues were $124 million in the quarter and up 27.5% year-on-year organically This was driven by growth in SmartDose 3.5 as revenues increased in anticipation of the expected midyear closing of the transaction, as well as good performance in Crystal Zenith and SelfDose. this was driven by growth in smartdose 3.5 as revenues increased in anticipation of the expected midyear closing of the transaction as well as good performance in crystal zenith and selfdose In Standard Products, revenues of $161 million were up 0.5% on an organic basis, partially driven by Annex 1 related conversion to HVP components. Our West Vantage segment delivered $151 million in revenue, growing 6.2% on an organic basis. Segment performance in the quarter was driven by an increase in sales of self-injected devices for obesity and diabetes. Now let's take a closer look at the rest of the P&L. Total company gross margin was 35.1% in the quarter, up 190 basis points year-over-year. The year-on-year increase is primarily driven by the positive mix shift of HVP components and price contribution. We did not see commodity costs have a material impact on our Q1 results. I also wanted to highlight that our West Vantage gross margin, while down slightly year-over-year as we ramp our Dublin facility, recovered sequentially as expected. In Standard Products, revenues of $161 million were up 0.5% on an organic basis, partially driven by Annex 1 related conversion to HVP components. in standard products revenues of $161 million were up 0.5% on an organic basis partially driven by annex 1 related conversion to hvp components Our West Vantage segment delivered $151 million in revenue, growing 6.2% on an organic basis. our west vantage segment delivered $151 million in revenue growing 6.2% on an organic basis Segment performance in the quarter was driven by an increase in sales of self-injected devices for obesity and diabetes. segment performance in the quarter was driven by an increase in sales of self-injected devices for obesity and diabetes Now let's take a closer look at the rest of the P&L. now let's take a closer look at the rest of the p&l Total company gross margin was 35.1% in the quarter, up 190 basis points year-over-year. total company gross margin was 35.1% in the quarter up 190 basis points year-over-year The year-on-year increase is primarily driven by the positive mix shift of HVP components and price contribution. the year-on-year increase is primarily driven by the positive mix shift of hvp components and price contribution We did not see commodity costs have a material impact on our Q1 results. we did not see commodity costs have a material impact on our q1 results I also wanted to highlight that our West Vantage gross margin, while down slightly year-over-year as we ramp our Dublin facility, recovered sequentially as expected. i also wanted to highlight that our west vantage gross margin while down slightly year-over-year as we ramp our dublin facility recovered sequentially as expected Adjusted operating margins of 21.4% were 350 basis points up compared to the prior year, driven by the gross margin expansion and leveraging our SG&A and R&D across a higher revenue base. Below the line, net interest income was in line with our expectations, while our tax rate was a better-than-expected 18.3% for the quarter, and we had 72.4 million diluted shares outstanding. Now adding it all up, Q1 adjusted earnings per share were $2.13, up 47% versus last year and up 45% above the midpoint of the guidance we gave on the last earnings call. Now, before moving into our updated 2026 guidance, I did want to highlight a few other additional financial metrics. In the quarter, we delivered operating cash flow of $90 million. Adjusted operating margins of 21.4% were 350 basis points up compared to the prior year, driven by the gross margin expansion and leveraging our SG&A and R&D across a higher revenue base. adjusted operating margins of 21.4% were 350 basis points up compared to the prior year driven by the gross margin expansion and leveraging our sg&a and r&d across a higher revenue base Below the line, net interest income was in line with our expectations, while our tax rate was a better-than-expected 18.3% for the quarter, and we had 72.4 million diluted shares outstanding. below the line net interest income was in line with our expectations while our tax rate was a better-than-expected 18.3% for the quarter and we had 72.4 million diluted shares outstanding Now adding it all up, Q1 adjusted earnings per share were $2.13, up 47% versus last year and up 45% above the midpoint of the guidance we gave on the last earnings call. now adding it all up q1 adjusted earnings per share were $2.13 up 47% versus last year and up 45% above the midpoint of the guidance we gave on the last earnings call Now, before moving into our updated 2026 guidance, I did want to highlight a few other additional financial metrics. now before moving into our updated 2026 guidance i did want to highlight a few other additional financial metrics In the quarter, we delivered operating cash flow of $90 million. in the quarter we delivered operating cash flow of $90 million While down year-on-year due to the increase in AR related to our strong sales performance and the 2025 bonus payout, it was ahead of our expectations. Capital expenditures were $43 million, down from $71 million in the prior year, as we continue to drive a focus on increased capital spending efficiency. We remain on track with our expectations of $250 million-$275 million for the year, even as we increase our revenue guidance, which I'll talk about shortly. In addition, during the quarter, the board of directors authorized a new $1 billion share repurchase program, given our strong financial position. In Q1, we repurchased 1.2 million shares for $298 million and paid out $16 million in dividends as an additional means of returning capital to shareholders. Our cash flow and strong balance sheet position us well as we look to deploy capital for growth and deliver value to shareholders. While down year-on-year due to the increase in AR related to our strong sales performance and the 2025 bonus payout, it was ahead of our expectations. while down year-on-year due to the increase in ar related to our strong sales performance and the 2025 bonus payout it was ahead of our expectations Capital expenditures were $43 million, down from $71 million in the prior year, as we continue to drive a focus on increased capital spending efficiency. capital expenditures were $43 million down from $71 million in the prior year as we continue to drive a focus on increased capital spending efficiency We remain on track with our expectations of $250 million-$275 million for the year, even as we increase our revenue guidance, which I'll talk about shortly. we remain on track with our expectations of $250 million-$275 million for the year even as we increase our revenue guidance which i'll talk about shortly In addition, during the quarter, the board of directors authorized a new $1 billion share repurchase program, given our strong financial position. in addition during the quarter the board of directors authorized a new $1 billion share repurchase program given our strong financial position In Q1, we repurchased 1.2 million shares for $298 million and paid out $16 million in dividends as an additional means of returning capital to shareholders. in q1 we repurchased 1.2 million shares for $298 million and paid out $16 million in dividends as an additional means of returning capital to shareholders Our cash flow and strong balance sheet position us well as we look to deploy capital for growth and deliver value to shareholders. our cash flow and strong balance sheet position us well as we look to deploy capital for growth and deliver value to shareholders We ended the first quarter with $521 million in cash on our balance sheet. In summary, we had a very good first quarter that exceeded our expectations, and the momentum we saw coming into the year is continuing. Now let me turn to our updated guidance. Before getting into the numbers, I want to highlight a few important factors driving our outlook. The macro environment continues to be dynamic, and so we will remain prudent with our forecasting given we have three quarters to go in the year. Most importantly, we've increased our growth expectations for the injectable market, driven by the underlying trends Eric talked about earlier. HVP components, both GLP-1 and non-GLP-1s, are the primary driver for our increased outlook. Our assumptions around the GLP-1 market continue to hold, and the non-GLP-1 market continues to improve. We ended the first quarter with $521 million in cash on our balance sheet. we ended the first quarter with $521 million in cash on our balance sheet In summary, we had a very good first quarter that exceeded our expectations, and the momentum we saw coming into the year is continuing. in summary we had a very good first quarter that exceeded our expectations and the momentum we saw coming into the year is continuing Now let me turn to our updated guidance. now let me turn to our updated guidance Before getting into the numbers, I want to highlight a few important factors driving our outlook. before getting into the numbers i want to highlight a few important factors driving our outlook The macro environment continues to be dynamic, and so we will remain prudent with our forecasting given we have three quarters to go in the year. the macro environment continues to be dynamic and so we will remain prudent with our forecasting given we have three quarters to go in the year Most importantly, we've increased our growth expectations for the injectable market, driven by the underlying trends Eric talked about earlier. most importantly we've increased our growth expectations for the injectable market driven by the underlying trends eric talked about earlier HVP components, both GLP-1 and non-GLP-1s, are the primary driver for our increased outlook. hvp components both glp-1 and non-glp-1s are the primary driver for our increased outlook Our assumptions around the GLP-1 market continue to hold, and the non-GLP-1 market continues to improve. our assumptions around the glp-1 market continue to hold and the non-glp-1 market continues to improve We've also incorporated rising oil and commodity prices into our updated thinking and are working to offset these costs through various means as we have with tariffs and other inflationary costs. We expect to have a net impact of single-digit millions after the mitigation efforts. Importantly, our operations and supply chain have not been affected. We continue to expect to close the SmartDose transaction mid-year. As a reminder, we generated $55 million in SmartDose sales in the second half of 2025 and have adjusted our full year 2026 expected organic growth rate to account for these revenues. For the year, we now anticipate revenue to be in the range of $3.295 billion-$3.35 billion, up $78 million at the midpoint. This reflects an increased organic revenue growth range of 7%-9% for the year. We've also incorporated rising oil and commodity prices into our updated thinking and are working to offset these costs through various means as we have with tariffs and other inflationary costs. we've also incorporated rising oil and commodity prices into our updated thinking and are working to offset these costs through various means as we have with tariffs and other inflationary costs We expect to have a net impact of single-digit millions after the mitigation efforts. we expect to have a net impact of single-digit millions after the mitigation efforts Importantly, our operations and supply chain have not been affected. importantly our operations and supply chain have not been affected We continue to expect to close the SmartDose transaction mid-year. we continue to expect to close the smartdose transaction mid-year As a reminder, we generated $55 million in SmartDose sales in the second half of 2025 and have adjusted our full year 2026 expected organic growth rate to account for these revenues. as a reminder we generated $55 million in smartdose sales in the second half of 2025 and have adjusted our full year 2026 expected organic growth rate to account for these revenues For the year, we now anticipate revenue to be in the range of $3.295 billion-$3.35 billion, up $78 million at the midpoint. for the year we now anticipate revenue to be in the range of $3.295 billion-$3.35 billion up $78 million at the midpoint This reflects an increased organic revenue growth range of 7%-9% for the year. this reflects an increased organic revenue growth range of 7%-9% for the year Reported growth is 7.2%-9.0% with our assumptions around FX and the SmartDose divestiture unchanged and roughly offsetting. The increase reflects strong Q1 performance and an improving demand environment for the remainder of the year. In the proprietary segment, we expect HVP components to continue to be the primary driver of revenue growth. We now anticipate this business to grow low to mid-teens organically for the year, accounting for about seven points of the total company growth at the midpoint of guidance. This is up from our previous expectation of roughly five points of total company growth at the midpoint. Importantly, both GLP-1 and non-GLP-1s are contributing. Reported growth is 7.2%-9.0% with our assumptions around FX and the SmartDose divestiture unchanged and roughly offsetting. reported growth is 7.2%-9.0% with our assumptions around fx and the smartdose divestiture unchanged and roughly offsetting The increase reflects strong Q1 performance and an improving demand environment for the remainder of the year. the increase reflects strong q1 performance and an improving demand environment for the remainder of the year In the proprietary segment, we expect HVP components to continue to be the primary driver of revenue growth. in the proprietary segment we expect hvp components to continue to be the primary driver of revenue growth We now anticipate this business to grow low to mid-teens organically for the year, accounting for about seven points of the total company growth at the midpoint of guidance. we now anticipate this business to grow low to mid-teens organically for the year accounting for about seven points of the total company growth at the midpoint of guidance This is up from our previous expectation of roughly five points of total company growth at the midpoint. this is up from our previous expectation of roughly five points of total company growth at the midpoint Importantly, both GLP-1 and non-GLP-1s are contributing. importantly both glp-1 and non-glp-1s are contributing Non-GLP-1 HVP components are expected to grow low double digits and make up just over 5 points of total company growth, while GLP-1 HVP components is expected to be in the mid- to high teens. We also expect better performance in our HVP delivery devices while our expectations for Standard Products in West Vantage are consistent with our previous guidance. The positive revenue mix is helping us to further expand our margins even as we see increased costs, and we have incorporated some below the line contributions in the updated guidance. To help with your models, we are now projecting $7 million in net interest income, a 19% tax rate for the full year, and roughly 71.5 million diluted shares outstanding for the full year. Non-GLP-1 HVP components are expected to grow low double digits and make up just over 5 points of total company growth, while GLP-1 HVP components is expected to be in the mid- to high teens. We also expect better performance in our HVP delivery devices while our expectations for Standard Products in West Vantage are consistent with our previous guidance. non-glp-1 hvp components are expected to grow low double digits and make up just over 5 points of total company growth while glp-1 hvp components is expected to be in the mid- to high teens. we also expect better performance in our hvp delivery devices while our expectations for standard products in west vantage are consistent with our previous guidance The positive revenue mix is helping us to further expand our margins even as we see increased costs, and we have incorporated some below the line contributions in the updated guidance. the positive revenue mix is helping us to further expand our margins even as we see increased costs and we have incorporated some below the line contributions in the updated guidance To help with your models, we are now projecting $7 million in net interest income, a 19% tax rate for the full year, and roughly 71.5 million diluted shares outstanding for the full year. to help with your models we are now projecting $7 million in net interest income a 19% tax rate for the full year and roughly 71.5 million diluted shares outstanding for the full year This results in an adjusted earnings per share to be between $8.40 to $8.75 for the year, up 15%-20% year-over-year. Now for the second quarter, we expect revenue to be in the range of $830 million-$850 million. This is a reported increase of 8.3%-10.9% and an organic increase of 7.0%-9.6%. We expect second quarter adjusted diluted earnings per share in the range of $2.05-$2.12, up 11.4%-15.2% year-over-year. In summary, we're very pleased with how our business is performing, driven by key growth drivers, and are optimistic about the future. Now I'd like to turn the call back over to Eric for some closing comments. Eric? This results in an adjusted earnings per share to be between $8.40 to $8.75 for the year, up 15%-20% year-over-year. this results in an adjusted earnings per share to be between $8.40 to $8.75 for the year up 15%-20% year-over-year Now for the second quarter, we expect revenue to be in the range of $830 million-$850 million. now for the second quarter we expect revenue to be in the range of $830 million-$850 million This is a reported increase of 8.3%-10.9% and an organic increase of 7.0%-9.6%. this is a reported increase of 8.3%-10.9% and an organic increase of 7.0%-9.6% We expect second quarter adjusted diluted earnings per share in the range of $2.05-$2.12, up 11.4%-15.2% year-over-year. we expect second quarter adjusted diluted earnings per share in the range of $2.05-$2.12 up 11.4%-15.2% year-over-year In summary, we're very pleased with how our business is performing, driven by key growth drivers, and are optimistic about the future. in summary we're very pleased with how our business is performing driven by key growth drivers and are optimistic about the future Now I'd like to turn the call back over to Eric for some closing comments. now i'd like to turn the call back over to eric for some closing comments Eric? eric

Speaker 5: Thank you, Bob. To summarize, the broad-based nature of the results we reported today continues to reaffirm that our growth strategy is working as expected. We have a strong, resilient business which delivers unique value to our customers. We remain focused on our critical growth drivers of biologics, GLP-1s, Annex 1, and other HVP conversion and leveraging our global infrastructure. For the long term, many durable macro trends underpin West's growth trajectory as the global market leader in the injectable medicine space. Finally, I want to thank our team members for their commitment and relentless focus to serving our customers, which allowed us to achieve these strong results. Operator, we're ready to take questions. Thank you. Thank you, Bob. thank you bob To summarize, the broad-based nature of the results we reported today continues to reaffirm that our growth strategy is working as expected. to summarize the broad-based nature of the results we reported today continues to reaffirm that our growth strategy is working as expected We have a strong, resilient business which delivers unique value to our customers. we have a strong resilient business which delivers unique value to our customers We remain focused on our critical growth drivers of biologics, GLP-1s, Annex 1, and other HVP conversion and leveraging our global infrastructure. we remain focused on our critical growth drivers of biologics glp-1s annex 1 and other hvp conversion and leveraging our global infrastructure For the long term, many durable macro trends underpin West's growth trajectory as the global market leader in the injectable medicine space. for the long term many durable macro trends underpin west's growth trajectory as the global market leader in the injectable medicine space Finally, I want to thank our team members for their commitment and relentless focus to serving our customers, which allowed us to achieve these strong results. finally i want to thank our team members for their commitment and relentless focus to serving our customers which allowed us to achieve these strong results Operator, we're ready to take questions. operator we're ready to take questions Thank you. thank you

Speaker 11: Thank you. If you'd like to ask a question, please press star one one. If your question has been answered and you'd like to remove yourself from the queue, press star one one again. We ask that you please limit yourself to one question. Our first question comes from Patrick Donnelly with Citi. Your line is open. Thank you. thank you If you'd like to ask a question, please press star one one. if you'd like to ask a question please press star one one If your question has been answered and you'd like to remove yourself from the queue, press star one one again. if your question has been answered and you'd like to remove yourself from the queue press star one one again We ask that you please limit yourself to one question. we ask that you please limit yourself to one question Our first question comes from Patrick Donnelly with Citi. our first question comes from patrick donnelly with citi Your line is open. your line is open

Speaker 12: Hey, guys. Good morning. Maybe one on the non-GLPs. Nice results there in particular. Can you talk about the acceleration you saw there? It sounds like, Bob, I think you were talking about low double digits for the rest of the year on non-GLPs. Can you just talk about what you're seeing? Is it Annex 1? Is it biosimilars, biologics? Would love you to just break that down a bit more because, again, the growth there was pretty notable. Hey, guys. hey guys Good morning. good morning Maybe one on the non-GLPs. maybe one on the non-glps Nice results there in particular. nice results there in particular Can you talk about the acceleration you saw there? can you talk about the acceleration you saw there It sounds like, Bob, I think you were talking about low double digits for the rest of the year on non-GLPs. it sounds like bob i think you were talking about low double digits for the rest of the year on non-glps Can you just talk about what you're seeing? can you just talk about what you're seeing Is it Annex 1? is it annex 1 Is it biosimilars, biologics? is it biosimilars biologics Would love you to just break that down a bit more because, again, the growth there was pretty notable. would love you to just break that down a bit more because again the growth there was pretty notable

Speaker 5: Yeah, Patrick, good morning, and thank you for the question. I think as we look at the HVP non-GLP-1 area of our business around the components, we're really pleased on how the market demands continue to increase, particularly in biologics and biosimilars. We mentioned that we grew 26%. We believe for the balance of the year, we'll have very strong double digits in that area. This is mostly on already commercialized drugs in the marketplace. While we do continue to have a very high win rate on new launches and new molecules being approved, most of the growth is coming from the commercialized drugs. Annex 1, as you asked about that particular area, that continues to meet our expectations. Yeah, Patrick, good morning, and thank you for the question. yeah patrick good morning and thank you for the question I think as we look at the HVP non-GLP-1 area of our business around the components, we're really pleased on how the market demands continue to increase, particularly in biologics and biosimilars. i think as we look at the hvp non-glp-1 area of our business around the components we're really pleased on how the market demands continue to increase particularly in biologics and biosimilars We mentioned that we grew 26%. we mentioned that we grew 26% We believe for the balance of the year, we'll have very strong double digits in that area. we believe for the balance of the year we'll have very strong double digits in that area This is mostly on already commercialized drugs in the marketplace. this is mostly on already commercialized drugs in the marketplace While we do continue to have a very high win rate on new launches and new molecules being approved, most of the growth is coming from the commercialized drugs. while we do continue to have a very high win rate on new launches and new molecules being approved most of the growth is coming from the commercialized drugs Annex 1, as you asked about that particular area, that continues to meet our expectations. annex 1 as you asked about that particular area that continues to meet our expectations We've seen a sequential improvement over the prior quarter, and it's up 66% over the first quarter of last year in the number of projects that we have taken on. This is actually, as you think about it, volume doesn't change, but the ASP and the margins do improve, and we'll continue to focus on that area. That is actually expanding as we think about it's not just EU regulations. We're starting to hear more about the expectations outside of Europe, particularly in the U.S. and also in Asia. We've seen a sequential improvement over the prior quarter, and it's up 66% over the first quarter of last year in the number of projects that we have taken on. we've seen a sequential improvement over the prior quarter and it's up 66% over the first quarter of last year in the number of projects that we have taken on This is actually, as you think about it, volume doesn't change, but the ASP and the margins do improve, and we'll continue to focus on that area. this is actually as you think about it volume doesn't change but the asp and the margins do improve and we'll continue to focus on that area That is actually expanding as we think about it's not just EU regulations. that is actually expanding as we think about it's not just eu regulations We're starting to hear more about the expectations outside of Europe, particularly in the U.S. and also in Asia. we're starting to hear more about the expectations outside of europe particularly in the u.s and also in asia I think the last area I want to just comment on, and that's why we have confidence in our guidance, is really unleashing some of our operational excellence in our HVP manufacturing sites. The work that we're doing in Europe is fungible, transferable to other sites, which will give us the ability to leverage existing capacity, higher throughput, higher output to be able to meet the rise in demand of our customers. Bob, would you like to add? I think the last area I want to just comment on, and that's why we have confidence in our guidance, is really unleashing some of our operational excellence in our HVP manufacturing sites. i think the last area i want to just comment on and that's why we have confidence in our guidance is really unleashing some of our operational excellence in our hvp manufacturing sites The work that we're doing in Europe is fungible, transferable to other sites, which will give us the ability to leverage existing capacity, higher throughput, higher output to be able to meet the rise in demand of our customers. the work that we're doing in europe is fungible transferable to other sites which will give us the ability to leverage existing capacity higher throughput higher output to be able to meet the rise in demand of our customers Bob, would you like to add? bob would you like to add

Speaker 1: Yeah, I would just say, Patrick, and thank you for the question. As you see, this is a continuation of what we saw in the second half of the year with this real continued momentum in the HVP non-GLP-1 components business. To Eric's point, what we've seen is a real combination of not only demand, the benefit of the positive mix associated with upgrading to Annex 1, and we expect both of those things to continue, as well as the continued market development of the biologics business. Feel very good about where that direction is going. If you recall, in Q4, we talked about demand outstripping supply. We're continuing to ramp and feel good about the team's ability to continue to meet that demand for the rest of the year. Yeah, I would just say, Patrick, and thank you for the question. yeah i would just say patrick and thank you for the question As you see, this is a continuation of what we saw in the second half of the year with this real continued momentum in the HVP non-GLP-1 components business. as you see this is a continuation of what we saw in the second half of the year with this real continued momentum in the hvp non-glp-1 components business To Eric's point, what we've seen is a real combination of not only demand, the benefit of the positive mix associated with upgrading to Annex 1, and we expect both of those things to continue, as well as the continued market development of the biologics business. to eric's point what we've seen is a real combination of not only demand the benefit of the positive mix associated with upgrading to annex 1 and we expect both of those things to continue as well as the continued market development of the biologics business Feel very good about where that direction is going. feel very good about where that direction is going If you recall, in Q4, we talked about demand outstripping supply. if you recall in q4 we talked about demand outstripping supply We're continuing to ramp and feel good about the team's ability to continue to meet that demand for the rest of the year. we're continuing to ramp and feel good about the team's ability to continue to meet that demand for the rest of the year

Speaker 12: Okay, that's helpful. Bob, maybe on the margin side, obviously when HVPs are growing 23%, it helps on the mix side. Can you just talk about how we should think about the margins for the rest of the year between the mix shift piece? You mentioned the manufacturing excellence there. I know the footprint is an area for help. It doesn't sound like the commodity side is going to be much of a negative offset. Maybe just talk about the moving pieces there. Again, obviously, the mix shift is helping quite a bit here. Okay, that's helpful. okay that's helpful Bob, maybe on the margin side, obviously when HVPs are growing 23%, it helps on the mix side. bob maybe on the margin side obviously when hvps are growing 23% it helps on the mix side Can you just talk about how we should think about the margins for the rest of the year between the mix shift piece? can you just talk about how we should think about the margins for the rest of the year between the mix shift piece You mentioned the manufacturing excellence there. you mentioned the manufacturing excellence there I know the footprint is an area for help. i know the footprint is an area for help It doesn't sound like the commodity side is going to be much of a negative offset. it doesn't sound like the commodity side is going to be much of a negative offset Maybe just talk about the moving pieces there. maybe just talk about the moving pieces there Again, obviously, the mix shift is helping quite a bit here. again obviously the mix shift is helping quite a bit here

Speaker 1: Yeah. What I would say is mix shift certainly does help, but we're also being benefited from the great operational execution by the team, which helps absorb the plant costs and so forth. If we think about where we were in Q1 at 21.4% margin, that was a significant improvement over last year. Q2 will probably be roughly in that line, and then second half will keep despite increased costs, our expectation is that we- Yeah. yeah What I would say is mix shift certainly does help, but we're also being benefited from the great operational execution by the team, which helps absorb the plant costs and so forth. what i would say is mix shift certainly does help but we're also being benefited from the great operational execution by the team which helps absorb the plant costs and so forth If we think about where we were in Q1 at 21.4% margin, that was a significant improvement over last year. if we think about where we were in q1 at 21.4% margin that was a significant improvement over last year Q2 will probably be roughly in that line, and then second half will keep despite increased costs, our expectation is that we- q2 will probably be roughly in that line and then second half will keep despite increased costs our expectation is that we-

Speaker 11: Ladies and gentlemen, please stand by. Your conference call will resume momentarily. Again, please stand by. Your conference call will resume momentarily. Ladies and gentlemen, please stand by. ladies and gentlemen please stand by Your conference call will resume momentarily. your conference call will resume momentarily Again, please stand by. again please stand by Your conference call will resume momentarily. your conference call will resume momentarily

Speaker 1: Hi, Patrick. Hi, this is Bob. Sorry, we got disconnected. Let me finish my thought. As I was saying, Hi, Patrick. hi patrick Hi, this is Bob. hi this is bob Sorry, we got disconnected. sorry we got disconnected Let me finish my thought. let me finish my thought As I was saying, as i was saying

Speaker 12: Yeah, you were about to talk about the second half, I think, when you dropped there. Yeah, you were about to talk about the second half, I think, when you dropped there. yeah you were about to talk about the second half i think when you dropped there

Speaker 1: Yeah, exactly. That wasn't a dramatic pause. I apologize to the folks on the call. What we're expecting, actually, in the second half of the year is an extension or an expansion of our margins despite the incremental costs associated with higher fuel and logistics costs. Some of that's a benefit of continued margin mix and strong performance on the revenue side. If we look at our full year, from last guide to this guide, probably another 50 basis points improvement year-over-year. A very nice expansion. Yeah, exactly. yeah exactly That wasn't a dramatic pause. that wasn't a dramatic pause I apologize to the folks on the call. i apologize to the folks on the call What we're expecting, actually, in the second half of the year is an extension or an expansion of our margins despite the incremental costs associated with higher fuel and logistics costs. what we're expecting actually in the second half of the year is an extension or an expansion of our margins despite the incremental costs associated with higher fuel and logistics costs Some of that's a benefit of continued margin mix and strong performance on the revenue side. some of that's a benefit of continued margin mix and strong performance on the revenue side If we look at our full year, from last guide to this guide, probably another 50 basis points improvement year-over-year. if we look at our full year from last guide to this guide probably another 50 basis points improvement year-over-year A very nice expansion. a very nice expansion

Speaker 12: Okay. Very helpful. Thanks so much. Okay. okay Very helpful. very helpful Thanks so much. thanks so much

Speaker 11: Thank you. Our next question comes from Michael Ryskin with Bank of America. Your line is open. Thank you. thank you Our next question comes from Michael Ryskin with Bank of America. our next question comes from michael ryskin with bank of america Your line is open. your line is open

Speaker 10: Great. Thanks for taking the question. Obviously, congrats on the quarter and the guide. I'm just curious, did you notice anything unusual in terms of ordering patterns or acceptance from customers? We're just wondering, maybe as a result of the Middle East crisis and the spike in oil, if any of your customers did any pre-buying or stocking ahead of time, just in anticipation of price increase or maybe supply constraints in the second half. Just wondering if you saw any weird dynamics in March once the conflict broke out. Great. great Thanks for taking the question. thanks for taking the question Obviously, congrats on the quarter and the guide. obviously congrats on the quarter and the guide I'm just curious, did you notice anything unusual in terms of ordering patterns or acceptance from customers? i'm just curious did you notice anything unusual in terms of ordering patterns or acceptance from customers We're just wondering, maybe as a result of the Middle East crisis and the spike in oil, if any of your customers did any pre-buying or stocking ahead of time, just in anticipation of price increase or maybe supply constraints in the second half. we're just wondering maybe as a result of the middle east crisis and the spike in oil if any of your customers did any pre-buying or stocking ahead of time just in anticipation of price increase or maybe supply constraints in the second half Just wondering if you saw any weird dynamics in March once the conflict broke out. just wondering if you saw any weird dynamics in march once the conflict broke out

Speaker 1: Yeah. Hey, Mike, this is Bob. Thanks for that question. I'm glad you brought that up because we've actually done a lot of analysis on our results, and we did not see any pull forward associated with the conflict in the Middle East. As we mentioned in the call, we did have greater than expected revenue associated with SmartDose 3.5, but that's a result of in anticipation of the transaction. There was no pull forward associated with the conflict. Yeah. yeah Hey, Mike, this is Bob. hey mike this is bob Thanks for that question. thanks for that question I'm glad you brought that up because we've actually done a lot of analysis on our results, and we did not see any pull forward associated with the conflict in the Middle East. i'm glad you brought that up because we've actually done a lot of analysis on our results and we did not see any pull forward associated with the conflict in the middle east As we mentioned in the call, we did have greater than expected revenue associated with SmartDose 3.5, but that's a result of in anticipation of the transaction. as we mentioned in the call we did have greater than expected revenue associated with smartdose 3.5 but that's a result of in anticipation of the transaction There was no pull forward associated with the conflict. there was no pull forward associated with the conflict

Speaker 10: All right. That's very straightforward. Thanks. I guess kind of just staying on the same topic. You mentioned some of the offsets and some of the mitigation you're putting in as a result of that. I was wondering if you could talk through that, like whether it's price increases. I know you guys have a hedge on oil. You called that out on the Q. Could you talk about that? Could you talk about, I think that's only a couple of months worth, but anticipation of price increases in the second half, maybe some supply chain moving around, just sort of how you're adjusting to that and how that's going to play out. Related to that- All right. all right That's very straightforward. that's very straightforward Thanks. thanks I guess kind of just staying on the same topic. i guess kind of just staying on the same topic You mentioned some of the offsets and some of the mitigation you're putting in as a result of that. you mentioned some of the offsets and some of the mitigation you're putting in as a result of that I was wondering if you could talk through that, like whether it's price increases. i was wondering if you could talk through that like whether it's price increases I know you guys have a hedge on oil. i know you guys have a hedge on oil You called that out on the Q. you called that out on the q Could you talk about that? could you talk about that Could you talk about, I think that's only a couple of months worth, but anticipation of price increases in the second half, maybe some supply chain moving around, just sort of how you're adjusting to that and how that's going to play out. could you talk about i think that's only a couple of months worth but anticipation of price increases in the second half maybe some supply chain moving around just sort of how you're adjusting to that and how that's going to play out Related to that- related to that-

Speaker 1: Yeah, thanks, Mike. Yeah. What I would say is we have multiple tools at our disposal. Certainly, we do hedge a portion of our costs associated with that, but that certainly is not going to be the only way that we have the ability to mitigate. Similar to what we have done with tariffs and so forth, we'll look at multiple tools. Probably premature to kind of explain all the details there, but we feel good about our ability to recover a portion of those costs. Yeah, thanks, Mike. yeah thanks mike Yeah. yeah What I would say is we have multiple tools at our disposal. what i would say is we have multiple tools at our disposal Certainly, we do hedge a portion of our costs associated with that, but that certainly is not going to be the only way that we have the ability to mitigate. certainly we do hedge a portion of our costs associated with that but that certainly is not going to be the only way that we have the ability to mitigate Similar to what we have done with tariffs and so forth, we'll look at multiple tools. similar to what we have done with tariffs and so forth we'll look at multiple tools Probably premature to kind of explain all the details there, but we feel good about our ability to recover a portion of those costs. probably premature to kind of explain all the details there but we feel good about our ability to recover a portion of those costs

Speaker 10: All right. Thanks. I'll leave it there. All right. all right Thanks. thanks I'll leave it there. i'll leave it there

Speaker 11: Thank you. Our next question comes from Paul Knight with KeyBanc. Your line is open. Thank you. thank you Our next question comes from Paul Knight with KeyBanc. our next question comes from paul knight with keybanc Your line is open. your line is open

Speaker 13: Hi, Eric. A lot of this quarter sounds like capacity coming online for West. My question is around, are there any bottlenecks that you see right now? Second, how easy is it for customers to move from one site or use another site's capacity? Does it take a month, a year, to get that qualification done? Hi, Eric. hi eric A lot of this quarter sounds like capacity coming online for West. a lot of this quarter sounds like capacity coming online for west My question is around, are there any bottlenecks that you see right now? my question is around, are there any bottlenecks that you see right now Second, how easy is it for customers to move from one site or use another site's capacity? second how easy is it for customers to move from one site or use another site's capacity Does it take a month, a year, to get that qualification done? does it take a month a year to get that qualification done

Speaker 5: Yeah, Paul, it's a multi-step process. First of all, on the capacity expansion, the teams have done a great job to unlock additional capacity utilization of existing facilities, and this initiative we launched in the second half of last year. We saw the benefits in Q1, and we'll continue to see that throughout the year. Higher throughput on existing capacity. We will always continue to layer in new capital equipment to be able to continuously expand basically around the HVP finishing processing, which really is being fueled by the Annex 1 transition. You're absolutely correct. Yeah, Paul, it's a multi-step process. yeah paul it's a multi-step process First of all, on the capacity expansion, the teams have done a great job to unlock additional capacity utilization of existing facilities, and this initiative we launched in the second half of last year. first of all on the capacity expansion the teams have done a great job to unlock additional capacity utilization of existing facilities and this initiative we launched in the second half of last year We saw the benefits in Q1, and we'll continue to see that throughout the year. we saw the benefits in q1 and we'll continue to see that throughout the year Higher throughput on existing capacity. higher throughput on existing capacity We will always continue to layer in new capital equipment to be able to continuously expand basically around the HVP finishing processing, which really is being fueled by the Annex 1 transition. we will always continue to layer in new capital equipment to be able to continuously expand basically around the hvp finishing processing which really is being fueled by the annex 1 transition You're absolutely correct. you're absolutely correct The second lever that we're working with certain customers is qualifying multi-sites. That process does take time. It could be anywhere between 6-12 months for a transfer to occur effectively in another site to be validated. That's ongoing, and we'll continue to leverage that across our network so we can level load more effectively. I would say that's additional benefit we will see throughout 2026 going into 2027. The second lever that we're working with certain customers is qualifying multi-sites. the second lever that we're working with certain customers is qualifying multi-sites That process does take time. that process does take time It could be anywhere between 6-12 months for a transfer to occur effectively in another site to be validated. it could be anywhere between 6-12 months for a transfer to occur effectively in another site to be validated That's ongoing, and we'll continue to leverage that across our network so we can level load more effectively. that's ongoing and we'll continue to leverage that across our network so we can level load more effectively I would say that's additional benefit we will see throughout 2026 going into 2027. i would say that's additional benefit we will see throughout 2026 going into 2027

Speaker 1: Yeah. Hey, Paul, this is Bob. Just the other thing that Eric mentioned that I want to reiterate is around taking the learnings and the application of what we're doing in Europe and applying it to other plants, particularly our HVP plants, to be able to get ahead of some of the continued demand. Not only are we doing the things that Eric was just talking about which will help us not only in the long term. In the near term, we're being able to leverage the existing assets that we have. Real nice work by the team. Yeah. yeah Hey, Paul, this is Bob. hey paul this is bob Just the other thing that Eric mentioned that I want to reiterate is around taking the learnings and the application of what we're doing in Europe and applying it to other plants, particularly our HVP plants, to be able to get ahead of some of the continued demand. just the other thing that eric mentioned that i want to reiterate is around taking the learnings and the application of what we're doing in europe and applying it to other plants particularly our hvp plants to be able to get ahead of some of the continued demand Not only are we doing the things that Eric was just talking about which will help us not only in the long term. not only are we doing the things that eric was just talking about which will help us not only in the long term In the near term, we're being able to leverage the existing assets that we have. in the near term we're being able to leverage the existing assets that we have Real nice work by the team. real nice work by the team

Speaker 13: Thank you. Thank you. thank you

Speaker 11: Thank you. Our next question comes from Matthew Larew with William Blair. Your line is open. Matthew Larew with William Blair, your line is open. If your telephone's muted, please unmute. Okay, we'll go to our next question, which comes from Kallum Titchmarsh with Morgan Stanley. Your line is open. Thank you. thank you Our next question comes from Matthew Larew with William Blair. our next question comes from matthew larew with william blair Your line is open. your line is open Matthew Larew with William Blair, your line is open. matthew larew with william blair your line is open If your telephone's muted, please unmute. if your telephone's muted please unmute Okay, we'll go to our next question, which comes from Kallum Titchmarsh with Morgan Stanley. okay we'll go to our next question which comes from kallum titchmarsh with morgan stanley Your line is open. your line is open

Speaker 8: Great. Thanks for taking the question, guys. Maybe just following up a bit more on Annex 1, and just checking in on the flow of new customer conversations and conversions there. Any refreshed view on the duration of this tailwind, whether customers are maybe facing issues for not upgrading their components and just how to think about what can be realistically captured from the TAM you framed up before? Great. great Thanks for taking the question, guys. thanks for taking the question guys Maybe just following up a bit more on Annex 1, and just checking in on the flow of new customer conversations and conversions there. maybe just following up a bit more on annex 1 and just checking in on the flow of new customer conversations and conversions there Any refreshed view on the duration of this tailwind, whether customers are maybe facing issues for not upgrading their components and just how to think about what can be realistically captured from the TAM you framed up before? any refreshed view on the duration of this tailwind whether customers are maybe facing issues for not upgrading their components and just how to think about what can be realistically captured from the tam you framed up before

Speaker 5: Yeah, Kallum, this area of opportunity for us is actually very attractive, and we're gaining momentum. What we're seeing right now is the number of projects our customers we're engaged with has increased and continues to increase. We're able to convert from a project status to commercialized product going into the market. I'm very pleased on the progress that we're making on both fronts. The conversations are actually more, I would say it's increasing because the regulations and our customers are looking beyond just Europe. Yeah, Kallum, this area of opportunity for us is actually very attractive, and we're gaining momentum. yeah kallum this area of opportunity for us is actually very attractive and we're gaining momentum What we're seeing right now is the number of projects our customers we're engaged with has increased and continues to increase. what we're seeing right now is the number of projects our customers we're engaged with has increased and continues to increase We're able to convert from a project status to commercialized product going into the market. we're able to convert from a project status to commercialized product going into the market I'm very pleased on the progress that we're making on both fronts. i'm very pleased on the progress that we're making on both fronts The conversations are actually more, I would say it's increasing because the regulations and our customers are looking beyond just Europe. the conversations are actually more i would say it's increasing because the regulations and our customers are looking beyond just europe Therefore, there's more of a pull effect on having us participate on upgrading certain products in market today on commercialized drugs really around our HVP finishing processes, which again, going back to what Bob mentioned earlier about unlocking or unleashing the opportunities to expand our capacity capabilities in our HVP plants, that's going to enable us to continue to grow nicely. The growth that we believe that we will continue to deliver on is 200 basis points per annum for multiple years. We're early innings, I would say. We've identified at least 6 billion units that are targeted to be converted, and we're early in that stage. We do think this is a very long-term growth opportunity. Therefore, there's more of a pull effect on having us participate on upgrading certain products in market today on commercialized drugs really around our HVP finishing processes, which again, going back to what Bob mentioned earlier about unlocking or unleashing the opportunities to expand our capacity capabilities in our HVP plants, that's going to enable us to continue to grow nicely. therefore there's more of a pull effect on having us participate on upgrading certain products in market today on commercialized drugs really around our hvp finishing processes which again going back to what bob mentioned earlier about unlocking or unleashing the opportunities to expand our capacity capabilities in our hvp plants that's going to enable us to continue to grow nicely The growth that we believe that we will continue to deliver on is 200 basis points per annum for multiple years. the growth that we believe that we will continue to deliver on is 200 basis points per annum for multiple years We're early innings, I would say. we're early innings i would say We've identified at least 6 billion units that are targeted to be converted, and we're early in that stage. we've identified at least 6 billion units that are targeted to be converted and we're early in that stage We do think this is a very long-term growth opportunity. we do think this is a very long-term growth opportunity

Speaker 1: Kallum, just to add to what Eric's saying and to emphasize a couple of points, the regulatory environment does continue to increase across the globe, particularly focused on contamination. I think we are uniquely positioned to be able to take advantage of this given our market position on existing products. We're very optimistic about this. Kallum, just to add to what Eric's saying and to emphasize a couple of points, the regulatory environment does continue to increase across the globe, particularly focused on contamination. kallum just to add to what eric's saying and to emphasize a couple of points the regulatory environment does continue to increase across the globe particularly focused on contamination I think we are uniquely positioned to be able to take advantage of this given our market position on existing products. i think we are uniquely positioned to be able to take advantage of this given our market position on existing products We're very optimistic about this. we're very optimistic about this

Speaker 8: Appreciate it. Then I realize it's kind of less than 10% of the group, but would love to hear a bit more about the kind of underlying demand environment in APAC. Pretty strong 29% growth in Q1. Just wondering if that's being underpinned by anything notably different than your U.S. and European growth drivers, and how we should think about investment into that region in the future. Thanks a lot. Appreciate it. appreciate it Then I realize it's kind of less than 10% of the group, but would love to hear a bit more about the kind of underlying demand environment in APAC. then i realize it's kind of less than 10% of the group but would love to hear a bit more about the kind of underlying demand environment in apac Pretty strong 29% growth in Q1. pretty strong 29% growth in q1 Just wondering if that's being underpinned by anything notably different than your U.S. and European growth drivers, and how we should think about investment into that region in the future. just wondering if that's being underpinned by anything notably different than your u.s and european growth drivers and how we should think about investment into that region in the future Thanks a lot. thanks a lot

Speaker 5: Yeah, no, we continue to look at Asia Pacific as an attractive market for us geographically. We support that region in twofold. One, local for local consumption, but also export that is going to the global market. We rely heavily in other locations to be able to feed finished product into that region. I would say that we are seeing an increase, particularly in the biologics or the biosimilars space, which we continue to have a very attractive participation rate. That's actually very attractive for us as you think about leveraging our higher end of our HVP portfolio. More to come, but we're pleased with the team's execution in region to support customers. We are seeing an increase of CDMOs, small biotech firms looking to be able to branch out into the Western markets. Yeah, no, we continue to look at Asia Pacific as an attractive market for us geographically. yeah no we continue to look at asia pacific as an attractive market for us geographically We support that region in twofold. we support that region in twofold One, local for local consumption, but also export that is going to the global market. one local for local consumption but also export that is going to the global market We rely heavily in other locations to be able to feed finished product into that region. we rely heavily in other locations to be able to feed finished product into that region I would say that we are seeing an increase, particularly in the biologics or the biosimilars space, which we continue to have a very attractive participation rate. i would say that we are seeing an increase particularly in the biologics or the biosimilars space which we continue to have a very attractive participation rate That's actually very attractive for us as you think about leveraging our higher end of our HVP portfolio. that's actually very attractive for us as you think about leveraging our higher end of our hvp portfolio More to come, but we're pleased with the team's execution in region to support customers. more to come but we're pleased with the team's execution in region to support customers We are seeing an increase of CDMOs, small biotech firms looking to be able to branch out into the Western markets. we are seeing an increase of cdmos, small biotech firms looking to be able to branch out into the western markets

Speaker 8: Helpful. Thanks, guys. Helpful. helpful Thanks, guys. thanks guys

Speaker 11: Thank you. Our next question comes from Justin Bowers with Deutsche Bank. Your line is open. Thank you. thank you Our next question comes from Justin Bowers with Deutsche Bank. our next question comes from justin bowers with deutsche bank Your line is open. your line is open

Speaker 7: Hi. Good morning, everyone. Eric, can you provide us with an update on the demand profile for some of the manufacturing space that you now have available in Dublin and in the West Coast? Two, just also an update on the GLP-1 market. What are you seeing in terms of other indications outside of diabetes and obesity? Are there programs growing in that part of the market as well? Hi. hi Good morning, everyone. good morning everyone Eric, can you provide us with an update on the demand profile for some of the manufacturing space that you now have available in Dublin and in the West Coast? eric can you provide us with an update on the demand profile for some of the manufacturing space that you now have available in dublin and in the west coast Two, just also an update on the GLP-1 market. two just also an update on the glp-1 market What are you seeing in terms of other indications outside of diabetes and obesity? what are you seeing in terms of other indications outside of diabetes and obesity Are there programs growing in that part of the market as well? are there programs growing in that part of the market as well

Speaker 5: Yeah, Justin, you're right. Let me start with the first question you asked about the CGM business in Dublin that we'll be finishing up at the end of second quarter of this year. We're pleased with the progress we're making with new customers and contracts to be able to backfill. Once the equipment processing lines are extracted from that facility, we are going to be installing new equipment from our customers to support them on their own new commercial launches, particularly around drug handling in the non-GLP-1 area. That's an area being attracted by our customers with the West Vantage strategy and the value proposition we're bringing. I'm very pleased with the progress. Yeah, Justin, you're right. yeah justin you're right Let me start with the first question you asked about the CGM business in Dublin that we'll be finishing up at the end of second quarter of this year. let me start with the first question you asked about the cgm business in dublin that we'll be finishing up at the end of second quarter of this year We're pleased with the progress we're making with new customers and contracts to be able to backfill. we're pleased with the progress we're making with new customers and contracts to be able to backfill Once the equipment processing lines are extracted from that facility, we are going to be installing new equipment from our customers to support them on their own new commercial launches, particularly around drug handling in the non-GLP-1 area. once the equipment processing lines are extracted from that facility we are going to be installing new equipment from our customers to support them on their own new commercial launches particularly around drug handling in the non-glp-1 area That's an area being attracted by our customers with the West Vantage strategy and the value proposition we're bringing. that's an area being attracted by our customers with the west vantage strategy and the value proposition we're bringing I'm very pleased with the progress. i'm very pleased with the progress More to come, but we do need to close out and finish strong on the current customer by the end of the second quarter, and then we'll do the transition in the second half with new customers. In regards to the GLP-1s, other indications other than obesity and diabetes, those are several projects in the pipeline that we're supporting. Actually, if you think about not just other indications, but other types of molecules that are being targeted for that market, we are obviously a very strong player and in the pipeline, it's very attractive. As you know, they're looking at combination molecules. They're looking at other types of biologics. We're very well-positioned, and we do think that'll be an extension of growth in that particular area for a number of years to come. More to come, but we do need to close out and finish strong on the current customer by the end of the second quarter, and then we'll do the transition in the second half with new customers. more to come but we do need to close out and finish strong on the current customer by the end of the second quarter and then we'll do the transition in the second half with new customers In regards to the GLP-1s, other indications other than obesity and diabetes, those are several projects in the pipeline that we're supporting. in regards to the glp-1s other indications other than obesity and diabetes those are several projects in the pipeline that we're supporting Actually, if you think about not just other indications, but other types of molecules that are being targeted for that market, we are obviously a very strong player and in the pipeline, it's very attractive. actually if you think about not just other indications but other types of molecules that are being targeted for that market we are obviously a very strong player and in the pipeline it's very attractive As you know, they're looking at combination molecules. as you know they're looking at combination molecules They're looking at other types of biologics. they're looking at other types of biologics We're very well-positioned, and we do think that'll be an extension of growth in that particular area for a number of years to come. we're very well-positioned and we do think that'll be an extension of growth in that particular area for a number of years to come

Speaker 7: Got it. Appreciate that. Just a quick follow-up. On the drug delivery device strength that you saw and the transition there, was that mostly volume driven, or was there any incentive payments there? What were sort of the contributors to the strength there? Got it. got it Appreciate that. appreciate that Just a quick follow-up. just a quick follow-up On the drug delivery device strength that you saw and the transition there, was that mostly volume driven, or was there any incentive payments there? on the drug delivery device strength that you saw and the transition there was that mostly volume driven or was there any incentive payments there What were sort of the contributors to the strength there? what were sort of the contributors to the strength there

Speaker 1: Yeah. Hey, Justin, this is Bob. Yeah, the good news is it was all volume. There weren't any incentive payments associated with that. Now, if you look at it was roughly split evenly between SmartDose and the non-SmartDose business. We feel really good about the performance going forward. Yeah. yeah Hey, Justin, this is Bob. hey justin this is bob Yeah, the good news is it was all volume. yeah the good news is it was all volume There weren't any incentive payments associated with that. there weren't any incentive payments associated with that Now, if you look at it was roughly split evenly between SmartDose and the non-SmartDose business. now if you look at it was roughly split evenly between smartdose and the non-smartdose business We feel really good about the performance going forward. we feel really good about the performance going forward

Speaker 7: Thank you. Thank you. thank you

Speaker 11: Thank you. Our next question comes from Matt Larew with William Blair. Your line is open. Matt, if your telephone is muted, please unmute. Thank you. thank you Our next question comes from Matt Larew with William Blair. our next question comes from matt larew with william blair Your line is open. your line is open Matt, if your telephone is muted, please unmute. matt if your telephone is muted please unmute

Speaker 1: Yeah. Let's move on to the next caller, please. Thank you, operator. Yeah. yeah Let's move on to the next caller, please. let's move on to the next caller please Thank you, operator. thank you operator

Speaker 11: You're welcome. Our next question comes from Daniel Markowitz with Evercore ISI. Your line is open. You're welcome. you're welcome Our next question comes from Daniel Markowitz with Evercore ISI. our next question comes from daniel markowitz with evercore isi Your line is open. your line is open

Speaker 3: Hey, guys, congrats on the results, and thank you so much for taking my questions. The first thing I wanted to ask on, the press release called out NovaPure as a positive for the first time in a while. Backing up, I think mix shift is such an awesome part of the story, and NovaPure sort of stands out as being at the high end of the high-value component segment. Really nice to see that. I just wanted to ask what sort of drove the strength there specifically? Hey, guys, congrats on the results, and thank you so much for taking my questions. hey guys congrats on the results and thank you so much for taking my questions The first thing I wanted to ask on, the press release called out NovaPure as a positive for the first time in a while. the first thing i wanted to ask on the press release called out novapure as a positive for the first time in a while Backing up, I think mix shift is such an awesome part of the story, and NovaPure sort of stands out as being at the high end of the high-value component segment. backing up i think mix shift is such an awesome part of the story and novapure sort of stands out as being at the high end of the high-value component segment Really nice to see that. really nice to see that I just wanted to ask what sort of drove the strength there specifically? i just wanted to ask what sort of drove the strength there specifically

Speaker 5: Yeah, Daniel. Excuse me. That's driven by market demand of commercialized molecules in market already. While we are continuing to see a number of new approvals in the pipeline, we're feeding it with NovaPure, but that particular growth that you're seeing, and we expect biologics to continue to grow quite nicely throughout 2026, is being fueled by NovaPure. Yeah, Daniel. yeah daniel Excuse me. excuse me That's driven by market demand of commercialized molecules in market already. that's driven by market demand of commercialized molecules in market already While we are continuing to see a number of new approvals in the pipeline, we're feeding it with NovaPure, but that particular growth that you're seeing, and we expect biologics to continue to grow quite nicely throughout 2026, is being fueled by NovaPure. while we are continuing to see a number of new approvals in the pipeline we're feeding it with novapure but that particular growth that you're seeing and we expect biologics to continue to grow quite nicely throughout 2026 is being fueled by novapure

Speaker 1: Yeah. It was one of the several highlights in the quarter, Daniel, and we feel good about the ongoing momentum there going forward. We had very nice growth in NovaPure year-over-year. Yeah. yeah It was one of the several highlights in the quarter, Daniel, and we feel good about the ongoing momentum there going forward. it was one of the several highlights in the quarter daniel and we feel good about the ongoing momentum there going forward We had very nice growth in NovaPure year-over-year. we had very nice growth in novapure year-over-year

Speaker 3: Great. Thank you. Just a follow-up. As I look at the full-year guide after a really strong first quarter and a nice Q2 guide, the full year now looks more first half-weighted versus what's typical. Is there anything to call out that's causing a decel in the back half, or is this more conservatism? Thanks, guys. Great. great Thank you. thank you Just a follow-up. just a follow-up As I look at the full-year guide after a really strong first quarter and a nice Q2 guide, the full year now looks more first half-weighted versus what's typical. as i look at the full-year guide after a really strong first quarter and a nice q2 guide the full year now looks more first half-weighted versus what's typical Is there anything to call out that's causing a decel in the back half, or is this more conservatism? is there anything to call out that's causing a decel in the back half or is this more conservatism Thanks, guys. thanks guys

Speaker 1: Yeah. Thanks. I'm glad you brought that up, Daniel. A couple of things. One is we are at the beginning of the year, so we are prudent. We're taking it one quarter at a time. We do have the roll-off of the CGM contract in the back half of the year. That is, as a reminder, is about a $40 million headwind in the second half of the year. That's no change from the original guidance that we had provided, and that also comes into play. What I would say is we're prudent with our guidance and feel good about the ongoing momentum of the business. Yeah. yeah Thanks. thanks I'm glad you brought that up, Daniel. i'm glad you brought that up daniel A couple of things. a couple of things One is we are at the beginning of the year, so we are prudent. one is we are at the beginning of the year so we are prudent We're taking it one quarter at a time. we're taking it one quarter at a time We do have the roll-off of the CGM contract in the back half of the year. we do have the roll-off of the cgm contract in the back half of the year That is, as a reminder, is about a $40 million headwind in the second half of the year. that is as a reminder is about a $40 million headwind in the second half of the year That's no change from the original guidance that we had provided, and that also comes into play. that's no change from the original guidance that we had provided and that also comes into play What I would say is we're prudent with our guidance and feel good about the ongoing momentum of the business. what i would say is we're prudent with our guidance and feel good about the ongoing momentum of the business

Speaker 3: Great. Thank you, and congrats again. Great. great Thank you, and congrats again. thank you and congrats again

Speaker 5: Thank you. Thank you. thank you

Speaker 11: Thank you. Our next question comes from David Windley with Jefferies. Your line is open. Thank you. thank you Our next question comes from David Windley with Jefferies. our next question comes from david windley with jefferies Your line is open. your line is open

Speaker 4: Hi. Good morning. Thanks for taking my question. I wanted to ask Eric about, or maybe Bob too, about incremental margin. As good as margin expansion is year-over-year. I guess I would come at it from the standpoint of still seems like there's quite a bit of opportunity there. Looking back on the model revenue, looked to be at a record level. You're rebalancing capacity to open up some new capacity. The NovaPure callout by Daniel, there's a number of factors that seem positive. Margin was better year-over-year, but down sequentially. I'm wondering if there were issues like the labor ramp-up that you mentioned, burden from commodity costs, or perhaps the weight of the SmartDose volume that came through in the quarter that might have shaded what would've otherwise been even better margin. Could you flesh that out for us? Hi. hi Good morning. good morning Thanks for taking my question. thanks for taking my question I wanted to ask Eric about, or maybe Bob too, about incremental margin. i wanted to ask eric about or maybe bob too about incremental margin As good as margin expansion is year-over-year. as good as margin expansion is year-over-year I guess I would come at it from the standpoint of still seems like there's quite a bit of opportunity there. i guess i would come at it from the standpoint of still seems like there's quite a bit of opportunity there Looking back on the model revenue, looked to be at a record level. looking back on the model revenue looked to be at a record level You're rebalancing capacity to open up some new capacity. you're rebalancing capacity to open up some new capacity The NovaPure callout by Daniel, there's a number of factors that seem positive. the novapure callout by daniel there's a number of factors that seem positive Margin was better year-over-year, but down sequentially. margin was better year-over-year but down sequentially I'm wondering if there were issues like the labor ramp-up that you mentioned, burden from commodity costs, or perhaps the weight of the SmartDose volume that came through in the quarter that might have shaded what would've otherwise been even better margin. i'm wondering if there were issues like the labor ramp-up that you mentioned burden from commodity costs or perhaps the weight of the smartdose volume that came through in the quarter that might have shaded what would've otherwise been even better margin Could you flesh that out for us? could you flesh that out for us

Speaker 5: Yeah, David, that's a good question, and let me start, and then I'm going to turn it over to Bob, but I think you've hit on the key points. We believe the HVP components business will continue to drive margin expansion. As we think about the biologics business continuing to grow, you're absolutely correct by pointing out NovaPure and the strength of that particular business which drives a very attractive margin expansion. We also have the continuation of the Annex 1, and that's a multi-year journey. As you know, we're basically moving an existing product in the market from a standard core level to a HVP, which brings very attractive margin expansion. I don't want to underestimate the impact of leveraging our HVP sites more effectively with operational excellence. We've learned a lot in the first quarter. Yeah, David, that's a good question, and let me start, and then I'm going to turn it over to Bob, but I think you've hit on the key points. yeah david that's a good question and let me start and then i'm going to turn it over to bob but i think you've hit on the key points We believe the HVP components business will continue to drive margin expansion. we believe the hvp components business will continue to drive margin expansion As we think about the biologics business continuing to grow, you're absolutely correct by pointing out NovaPure and the strength of that particular business which drives a very attractive margin expansion. as we think about the biologics business continuing to grow you're absolutely correct by pointing out novapure and the strength of that particular business which drives a very attractive margin expansion We also have the continuation of the Annex 1, and that's a multi-year journey. we also have the continuation of the annex 1 and that's a multi-year journey As you know, we're basically moving an existing product in the market from a standard core level to a HVP, which brings very attractive margin expansion. as you know we're basically moving an existing product in the market from a standard core level to a hvp which brings very attractive margin expansion I don't want to underestimate the impact of leveraging our HVP sites more effectively with operational excellence. i don't want to underestimate the impact of leveraging our hvp sites more effectively with operational excellence We've learned a lot in the first quarter. we've learned a lot in the first quarter There's more to be done and also spread to our other sites, which we've actually seen as we went to those sites a few weeks ago. We're very optimistic that we will be able to get more out of the existing capital that's in place today to produce HVP. I do agree that there is opportunity for further margin expansion based on the HVP components. Bob, do you want to add? There's more to be done and also spread to our other sites, which we've actually seen as we went to those sites a few weeks ago. there's more to be done and also spread to our other sites which we've actually seen as we went to those sites a few weeks ago We're very optimistic that we will be able to get more out of the existing capital that's in place today to produce HVP. we're very optimistic that we will be able to get more out of the existing capital that's in place today to produce hvp I do agree that there is opportunity for further margin expansion based on the HVP components. i do agree that there is opportunity for further margin expansion based on the hvp components Bob, do you want to add? bob do you want to add

Speaker 1: Yeah. David, just a couple of other pieces of data. You're right. If we think about Q1, we were ramping throughout the course of the year, so the March had a much better performance than January. That'll continue to expand as we go through the rest of the year, as those individuals were ramping up from a capacity standpoint. We did have a very good incremental, but I think it can be better. SmartDose did have some impact on that. Obviously, to the earlier question around quarterly cadence, that's one of the reasons the second half of the year, we expect on our operating margin basis to be pretty heftily above where we are in the first half of the year. A number of, I would say, positive opportunities for us to continue to expand margin, not only this year, but going into next year as well. Yeah. yeah David, just a couple of other pieces of data. david just a couple of other pieces of data You're right. you're right If we think about Q1, we were ramping throughout the course of the year, so the March had a much better performance than January. if we think about q1 we were ramping throughout the course of the year so the march had a much better performance than january That'll continue to expand as we go through the rest of the year, as those individuals were ramping up from a capacity standpoint. that'll continue to expand as we go through the rest of the year as those individuals were ramping up from a capacity standpoint We did have a very good incremental, but I think it can be better. we did have a very good incremental but i think it can be better SmartDose did have some impact on that. smartdose did have some impact on that Obviously, to the earlier question around quarterly cadence, that's one of the reasons the second half of the year, we expect on our operating margin basis to be pretty heftily above where we are in the first half of the year. obviously to the earlier question around quarterly cadence that's one of the reasons the second half of the year we expect on our operating margin basis to be pretty heftily above where we are in the first half of the year A number of, I would say, positive opportunities for us to continue to expand margin, not only this year, but going into next year as well. a number of i would say positive opportunities for us to continue to expand margin not only this year but going into next year as well

Speaker 4: Great. Thanks. If I could just quickly follow up, Eric, I'd like to believe, based on my own age, that you're still a pretty young chicken. You've made the decision to retire. Could you talk to us about that, please? Great. great Thanks. thanks If I could just quickly follow up, Eric, I'd like to believe, based on my own age, that you're still a pretty young chicken. if i could just quickly follow up eric i'd like to believe based on my own age that you're still a pretty young chicken You've made the decision to retire. you've made the decision to retire Could you talk to us about that, please? could you talk to us about that please

Speaker 5: David, thanks for that. I'm pleased that you recognize that I'm still young. I feel it. Look, I think this is an outstanding organization, a lot of legacy, but a great future ahead of us, and I'm very proud of how the team's operating. I'm extremely proud of the executive team that we put in place, one of them sitting next to me right now. I do think this team is performing at a very high level, and will continue to do so. The business is operating very well. The strategy is very clear. The global leadership team is aligned and executing. David, thanks for that. david thanks for that I'm pleased that you recognize that I'm still young. i'm pleased that you recognize that i'm still young I feel it. i feel it Look, I think this is an outstanding organization, a lot of legacy, but a great future ahead of us, and I'm very proud of how the team's operating. look i think this is an outstanding organization a lot of legacy but a great future ahead of us and i'm very proud of how the team's operating I'm extremely proud of the executive team that we put in place, one of them sitting next to me right now. i'm extremely proud of the executive team that we put in place one of them sitting next to me right now I do think this team is performing at a very high level, and will continue to do so. i do think this team is performing at a very high level and will continue to do so The business is operating very well. the business is operating very well The strategy is very clear. the strategy is very clear The global leadership team is aligned and executing. the global leadership team is aligned and executing As I think about the successor coming in, when appointed, we'll be in a very good position to continue to take this business forward. I'm excited about where we are at West, but I'm more excited about the future. I couldn't be more proud about the team across the globe and how they are executing today, but more important, the future of this business. As I think about the successor coming in, when appointed, we'll be in a very good position to continue to take this business forward. as i think about the successor coming in when appointed we'll be in a very good position to continue to take this business forward I'm excited about where we are at West, but I'm more excited about the future. i'm excited about where we are at west but i'm more excited about the future I couldn't be more proud about the team across the globe and how they are executing today, but more important, the future of this business. i couldn't be more proud about the team across the globe and how they are executing today but more important the future of this business

Speaker 4: Thank you, and congrats. Thank you, and congrats. thank you and congrats

Speaker 5: Thank you. Thank you. thank you

Speaker 11: Thank you. Our next question comes from Larry Solow with CJS Securities. Your line is open. Thank you. thank you Our next question comes from Larry Solow with CJS Securities. our next question comes from larry solow with cjs securities Your line is open. your line is open

Speaker 9: Great. Thanks. Congrats on the quarter as well. Just to follow up on Dave's question there, Eric, we're going to miss you. It sounds like nothing imminent, but just curious how the search is going. Any kind of high-level timelines you can share with us or any thoughts there? Great. great Thanks. thanks Congrats on the quarter as well. congrats on the quarter as well Just to follow up on Dave's question there, Eric, we're going to miss you. just to follow up on dave's question there eric we're going to miss you It sounds like nothing imminent, but just curious how the search is going. it sounds like nothing imminent but just curious how the search is going Any kind of high-level timelines you can share with us or any thoughts there? any kind of high-level timelines you can share with us or any thoughts there

Speaker 5: Yeah. Larry, thank you. We are active in the market as we speak. We anticipate that my successor will be appointed in the second half of this year. We'll keep you informed as we make progress, but, again, as I've mentioned earlier with David's question, this is an unbelievable company, and I think it's going to be. Once we have somebody appointed, we'll be in a very good position. Yeah. yeah Larry, thank you. larry thank you We are active in the market as we speak. we are active in the market as we speak We anticipate that my successor will be appointed in the second half of this year. we anticipate that my successor will be appointed in the second half of this year We'll keep you informed as we make progress, but, again, as I've mentioned earlier with David's question, this is an unbelievable company, and I think it's going to be. we'll keep you informed as we make progress but again as i've mentioned earlier with david's question this is an unbelievable company and i think it's going to be Once we have somebody appointed, we'll be in a very good position. once we have somebody appointed we'll be in a very good position

Speaker 9: Yeah, absolutely. You've done a great job enhancing the company dialogue too, for sure. Just a couple follow-up questions. You mentioned NovaPure. Most of the growth there has been driven by current products in the market. Just curious on the Annex 1, what folks are kind of shifting it towards. Is it more towards the lower end of the curve there, like the Westar, and then maybe as you go up a little more on the Fluorotec side? Or do you see some of these 6 billion potential components, some of them eventually even converting to some of the higher level of value services there? Yeah, absolutely. yeah absolutely You've done a great job enhancing the company dialogue too, for sure. you've done a great job enhancing the company dialogue too for sure Just a couple follow-up questions. just a couple follow-up questions You mentioned NovaPure. you mentioned novapure Most of the growth there has been driven by current products in the market. most of the growth there has been driven by current products in the market Just curious on the Annex 1, what folks are kind of shifting it towards. just curious on the annex 1 what folks are kind of shifting it towards Is it more towards the lower end of the curve there, like the Westar, and then maybe as you go up a little more on the Fluorotec side? is it more towards the lower end of the curve there like the westar and then maybe as you go up a little more on the fluorotec side Or do you see some of these 6 billion potential components, some of them eventually even converting to some of the higher level of value services there? or do you see some of these 6 billion potential components some of them eventually even converting to some of the higher level of value services there

Speaker 5: Larry, it's going to be a mixed answer for you. It really depends on the customer and the molecule itself. You're right. I would say if you look at a weighted average, more so around the Westar, and then leveraging Envision, pharmaceutical washing, sterilization. We do have a few cases where they're going all the way up to the high end of the spectrum of HVP. It is more about the midpoint of that portfolio. As a reminder, many of them are starting off at the standard legacy product. Again, either case is very positive. We do also have some shift from the lower end of HVP going to the higher end. It's a combination of both. Larry, it's going to be a mixed answer for you. larry it's going to be a mixed answer for you It really depends on the customer and the molecule itself. it really depends on the customer and the molecule itself You're right. you're right I would say if you look at a weighted average, more so around the Westar, and then leveraging Envision, pharmaceutical washing, sterilization. i would say if you look at a weighted average more so around the westar and then leveraging envision pharmaceutical washing sterilization We do have a few cases where they're going all the way up to the high end of the spectrum of HVP. we do have a few cases where they're going all the way up to the high end of the spectrum of hvp It is more about the midpoint of that portfolio. it is more about the midpoint of that portfolio As a reminder, many of them are starting off at the standard legacy product. as a reminder many of them are starting off at the standard legacy product Again, either case is very positive. again either case is very positive We do also have some shift from the lower end of HVP going to the higher end. we do also have some shift from the lower end of hvp going to the higher end It's a combination of both. it's a combination of both

Speaker 9: Mm-hmm. Mm-hmm. mm-hmm

Speaker 5: I gave you kind of a wide spectrum answer there, but that's why it's exciting. It's leveraging our global HVP finishing processes. I gave you kind of a wide spectrum answer there, but that's why it's exciting. i gave you kind of a wide spectrum answer there but that's why it's exciting It's leveraging our global HVP finishing processes. it's leveraging our global hvp finishing processes

Speaker 9: Got you. Just quickly, if I may, just one last one. Just on the West Vantage, I guess you're calling that now. I guess the cadence should we expect for the rest of the year, do we expect a little bit of a dip? You had obviously a really nice strong quarter towards the middle back end of the year as the rest of the continuous glucose so that next piece comes out, and then sort of a rebuild in 2027. Along those lines, how should we view the margin profile of the segment as we go out in the next couple of years? Thanks. Got you. got you Just quickly, if I may, just one last one. just quickly if i may just one last one Just on the West Vantage, I guess you're calling that now. just on the west vantage i guess you're calling that now I guess the cadence should we expect for the rest of the year, do we expect a little bit of a dip? i guess the cadence should we expect for the rest of the year do we expect a little bit of a dip You had obviously a really nice strong quarter towards the middle back end of the year as the rest of the continuous glucose so that next piece comes out, and then sort of a rebuild in 2027. you had obviously a really nice strong quarter towards the middle back end of the year as the rest of the continuous glucose so that next piece comes out and then sort of a rebuild in 2027 Along those lines, how should we view the margin profile of the segment as we go out in the next couple of years? along those lines how should we view the margin profile of the segment as we go out in the next couple of years Thanks. thanks

Speaker 1: Yeah. Hey, Larry, I'll take that question. You're right, there is a kind of front half weighting associated with that, just given what we were talking about before with the CGM contract exiting. Our forecast for the year remains unchanged at roughly flat. It'll be up in the first half and then maybe slightly down. Q3, I would expect to be the trough, because if you remember, the drug handling is kind of ramping up throughout the year. As Eric mentioned, it's on track. That's $20 million of incremental revenue. Most of that will be in the back half of the year. As we've talked about, the benefit of that drug handling is that's a higher margin business than what it's replacing. From a margin profile, I would expect margin profile to be roughly consistent across the year. Yeah. yeah Hey, Larry, I'll take that question. hey larry i'll take that question You're right, there is a kind of front half weighting associated with that, just given what we were talking about before with the CGM contract exiting. you're right there is a kind of front half weighting associated with that just given what we were talking about before with the cgm contract exiting Our forecast for the year remains unchanged at roughly flat. our forecast for the year remains unchanged at roughly flat It'll be up in the first half and then maybe slightly down. it'll be up in the first half and then maybe slightly down Q3, I would expect to be the trough, because if you remember, the drug handling is kind of ramping up throughout the year. q3 i would expect to be the trough because if you remember the drug handling is kind of ramping up throughout the year As Eric mentioned, it's on track. as eric mentioned it's on track That's $20 million of incremental revenue. that's $20 million of incremental revenue Most of that will be in the back half of the year. most of that will be in the back half of the year As we've talked about, the benefit of that drug handling is that's a higher margin business than what it's replacing. as we've talked about the benefit of that drug handling is that's a higher margin business than what it's replacing From a margin profile, I would expect margin profile to be roughly consistent across the year. from a margin profile i would expect margin profile to be roughly consistent across the year

Speaker 9: Got it. Okay. Eventually, does the drug handling have a higher margin as you build that out? Got it. got it Okay. okay Eventually, does the drug handling have a higher margin as you build that out? eventually does the drug handling have a higher margin as you build that out

Speaker 1: Yes. Yes. yes

Speaker 9: Okay. Okay. okay

Speaker 1: Yeah. The drug handling margin, and it's important, two other things. The drug handling business, while it has $20 million this year, that is certainly not at ramp. At peak, it's probably- Yeah. yeah The drug handling margin, and it's important, two other things. the drug handling margin and it's important two other things The drug handling business, while it has $20 million this year, that is certainly not at ramp. the drug handling business while it has $20 million this year that is certainly not at ramp At peak, it's probably- at peak it's probably-

Speaker 9: Right. Right. right

Speaker 1: Three times that much, which we'll continue to see ramp throughout 2027. From a margin perspective, it's at least twice as much on a gross margin basis. Three times that much, which we'll continue to see ramp throughout 2027. three times that much which we'll continue to see ramp throughout 2027 From a margin perspective, it's at least twice as much on a gross margin basis. from a margin perspective it's at least twice as much on a gross margin basis

Speaker 9: Okay. Okay. okay

Speaker 1: As our current business. As our current business. as our current business

Speaker 9: Got you. That's perfect follow-up. Great. Thank you. I appreciate that, Bob. Got you. got you That's perfect follow-up. that's perfect follow-up Great. great Thank you. thank you I appreciate that, Bob. i appreciate that bob

Speaker 11: Thank you. Our next question comes from Brendan Smith with TD Cowen. Your line is open. Thank you. thank you Our next question comes from Brendan Smith with TD Cowen. our next question comes from brendan smith with td cowen Your line is open. your line is open

Speaker 2: Hey, guys. Great print. In terms of the 200 basis point growth contribution related to Annex 1, is most of that baking in Europe-based upgrades? Are you seeing any customers upgrade? You mentioned the U.S. and Asia as next logical geographies, but are you seeing any customers upgrade in parallel? Could that present any upside to that current expectation? Hey, guys. hey guys Great print. great print In terms of the 200 basis point growth contribution related to Annex 1, is most of that baking in Europe-based upgrades? in terms of the 200 basis point growth contribution related to annex 1 is most of that baking in europe-based upgrades Are you seeing any customers upgrade? are you seeing any customers upgrade You mentioned the U.S. and Asia as next logical geographies, but are you seeing any customers upgrade in parallel? you mentioned the u.s and asia as next logical geographies but are you seeing any customers upgrade in parallel Could that present any upside to that current expectation? could that present any upside to that current expectation

Speaker 11: Please stand by. Please stand by. please stand by

Speaker 5: Michelle, can you hear us? Michelle, can you hear us? michelle can you hear us

Speaker 11: Yes. Yes. yes

Speaker 5: Okay. Can you put us in? Okay. okay Can you put us in? can you put us in

Speaker 11: You're on. Go ahead. You're on. you're on Go ahead. go ahead

Speaker 2: Okay. Yeah. In terms of the 200 basis point growth contribution related to Annex 1, you mentioned the U.S. and Asia as next sort of subsequent geographies seeing upgrades. Is the current expectation baking in pretty much just Europe, or are you seeing any customers upgrade in parallel across geographies, and could that represent some upside opportunity there? Okay. okay Yeah. yeah In terms of the 200 basis point growth contribution related to Annex 1, you mentioned the U.S. and Asia as next sort of subsequent geographies seeing upgrades. in terms of the 200 basis point growth contribution related to annex 1 you mentioned the u.s and asia as next sort of subsequent geographies seeing upgrades Is the current expectation baking in pretty much just Europe, or are you seeing any customers upgrade in parallel across geographies, and could that represent some upside opportunity there? is the current expectation baking in pretty much just europe or are you seeing any customers upgrade in parallel across geographies and could that represent some upside opportunity there

Speaker 5: Yeah. There's two factors that are happening, Brendan. Good question. One is, our customers that are looking to upgrade for the European market are also looking at their portfolio and making more global decisions and being consistent. We are seeing that as one factor. Another factor we are seeing, we're being brought into conversations with our customers, even in the United States, with the FDA making observations around sterility and the strategy around other manufacturing processes, and therefore there's opportunity to upgrade even in the U.S. market. We're seeing a factor of both, and we'll see how this plays out in the near term, and that might be a potential opportunity. Yeah. yeah There's two factors that are happening, Brendan. there's two factors that are happening brendan Good question. good question One is, our customers that are looking to upgrade for the European market are also looking at their portfolio and making more global decisions and being consistent. one is our customers that are looking to upgrade for the european market are also looking at their portfolio and making more global decisions and being consistent We are seeing that as one factor. we are seeing that as one factor Another factor we are seeing, we're being brought into conversations with our customers, even in the United States, with the FDA making observations around sterility and the strategy around other manufacturing processes, and therefore there's opportunity to upgrade even in the U.S. market. another factor we are seeing we're being brought into conversations with our customers even in the united states with the fda making observations around sterility and the strategy around other manufacturing processes and therefore there's opportunity to upgrade even in the u.s market We're seeing a factor of both, and we'll see how this plays out in the near term, and that might be a potential opportunity. we're seeing a factor of both and we'll see how this plays out in the near term and that might be a potential opportunity

Speaker 1: Brendan, I think the other thing to think about is a potential accelerant here is as we think about all the work that's happening from the on-shoring standpoint. A lot of that is actually coming from Europe into the U.S., and what our pharma customers are wanting to do is standardize on a consistent product and process. That hasn't been fully baked in, because a lot of that work is still ongoing, but that has the potential to kind of accelerate and expand our Annex 1 opportunities well beyond Europe. Brendan, I think the other thing to think about is a potential accelerant here is as we think about all the work that's happening from the on-shoring standpoint. brendan i think the other thing to think about is a potential accelerant here is as we think about all the work that's happening from the on-shoring standpoint A lot of that is actually coming from Europe into the U.S., and what our pharma customers are wanting to do is standardize on a consistent product and process. a lot of that is actually coming from europe into the u.s and what our pharma customers are wanting to do is standardize on a consistent product and process That hasn't been fully baked in, because a lot of that work is still ongoing, but that has the potential to kind of accelerate and expand our Annex 1 opportunities well beyond Europe. that hasn't been fully baked in because a lot of that work is still ongoing but that has the potential to kind of accelerate and expand our annex 1 opportunities well beyond europe

Speaker 2: That's great. In terms of the operational excellence plan, can you speak to maybe, like, a cadence of executing that across sites or some timelines? And are those improvements baked into the raised guidance? Thanks for the questions. That's great. that's great In terms of the operational excellence plan, can you speak to maybe, like, a cadence of executing that across sites or some timelines? in terms of the operational excellence plan can you speak to maybe like a cadence of executing that across sites or some timelines And are those improvements baked into the raised guidance? and are those improvements baked into the raised guidance Thanks for the questions. thanks for the questions

Speaker 5: Yeah, the cadence is we're live right now. We're actually transferring some of the learnings and knowledge into other sites, and particularly in Kinston and Jersey Shore, outside of our Eschweiler and Waterford plants. That is in process, and that will continue to occur throughout the year. As Bob alluded that we saw a nice margin expansion within the quarter because of these efforts. We are still in the build-up mode. We should see the expectations of additional benefits throughout the next several quarters. Yeah, the cadence is we're live right now. yeah the cadence is we're live right now We're actually transferring some of the learnings and knowledge into other sites, and particularly in Kinston and Jersey Shore, outside of our Eschweiler and Waterford plants. we're actually transferring some of the learnings and knowledge into other sites and particularly in kinston and jersey shore outside of our eschweiler and waterford plants That is in process, and that will continue to occur throughout the year. that is in process and that will continue to occur throughout the year As Bob alluded that we saw a nice margin expansion within the quarter because of these efforts. as bob alluded that we saw a nice margin expansion within the quarter because of these efforts We are still in the build-up mode. we are still in the build-up mode We should see the expectations of additional benefits throughout the next several quarters. we should see the expectations of additional benefits throughout the next several quarters

Speaker 1: Yeah. We have baked some of that operational improvement in the forecast. Yeah. yeah We have baked some of that operational improvement in the forecast. we have baked some of that operational improvement in the forecast

Speaker 11: Thank you. Our next question comes from Thomas DeBourcy with Nephron Research. Your line is open. Thank you. thank you Our next question comes from Thomas DeBourcy with Nephron Research. our next question comes from thomas debourcy with nephron research Your line is open. your line is open

Speaker 14: Hi, guys. Thanks for taking the question. I was just wondering on HVP delivery devices and, I guess, post the divestiture of SmartDose 3.5 milliliters, just how you think about that business. I know you have the Securi platform and how you think about, I guess, adding to that portfolio and whether that's still obviously, I guess, a core part of your offering to customers. Hi, guys. hi guys Thanks for taking the question. thanks for taking the question I was just wondering on HVP delivery devices and, I guess, post the divestiture of SmartDose 3.5 milliliters, just how you think about that business. i was just wondering on hvp delivery devices and i guess post the divestiture of smartdose 3.5 milliliters just how you think about that business I know you have the Securi platform and how you think about, I guess, adding to that portfolio and whether that's still obviously, I guess, a core part of your offering to customers. i know you have the securi platform and how you think about i guess adding to that portfolio and whether that's still obviously i guess a core part of your offering to customers

Speaker 5: Yeah. No, absolutely. Within that portfolio, we have administrative systems, which is a very attractive market that continues to expand and grow, particularly in the hospital market. We have the Crystal Zenith, which is a containment alternative to glass that is really targeted to the highest end of biologics and cell and gene therapy. You have the other alternative delivery devices like SelfDose that the demand and volumes are continuing to increase. We have other versions in volume doses that we're able to offer our market. We believe delivery devices is natural in this area as primary containment is a natural extension from our elastomer business. We'll continue to invest around new product development, and manufacturing capacity expansion because it's a very attractive growth profile and a margin opportunity. Yeah. yeah No, absolutely. no absolutely Within that portfolio, we have administrative systems, which is a very attractive market that continues to expand and grow, particularly in the hospital market. within that portfolio we have administrative systems which is a very attractive market that continues to expand and grow particularly in the hospital market We have the Crystal Zenith, which is a containment alternative to glass that is really targeted to the highest end of biologics and cell and gene therapy. we have the crystal zenith which is a containment alternative to glass that is really targeted to the highest end of biologics and cell and gene therapy You have the other alternative delivery devices like SelfDose that the demand and volumes are continuing to increase. you have the other alternative delivery devices like selfdose that the demand and volumes are continuing to increase We have other versions in volume doses that we're able to offer our market. we have other versions in volume doses that we're able to offer our market We believe delivery devices is natural in this area as primary containment is a natural extension from our elastomer business. we believe delivery devices is natural in this area as primary containment is a natural extension from our elastomer business We'll continue to invest around new product development, and manufacturing capacity expansion because it's a very attractive growth profile and a margin opportunity. we'll continue to invest around new product development and manufacturing capacity expansion because it's a very attractive growth profile and a margin opportunity

Speaker 14: Great. Thanks. Great. great Thanks. thanks

Speaker 5: Thank you. Thank you. thank you

Speaker 11: Thank you. I'm showing no further questions at this time. I'd like to turn the call back over to John Sweeney for closing remarks. Thank you. thank you I'm showing no further questions at this time. i'm showing no further questions at this time I'd like to turn the call back over to John Sweeney for closing remarks. i'd like to turn the call back over to john sweeney for closing remarks

Speaker 6: Thank you very much for joining us today on our first quarter 2026 earnings conference call. We look forward to updating you as we move through the year. Thanks very much and have a good day. Thank you very much for joining us today on our first quarter 2026 earnings conference call. thank you very much for joining us today on our first quarter 2026 earnings conference call We look forward to updating you as we move through the year. we look forward to updating you as we move through the year Thanks very much and have a good day. thanks very much and have a good day

Speaker 11: Thank you for your participation. You may now disconnect. Everyone, have a great day. Thank you for your participation. thank you for your participation You may now disconnect. you may now disconnect Everyone, have a great day. everyone have a great day