Can you highlight the main achievements of Sai Life Sciences (Sai) in 2023?

In 2023, Sai Life Sciences experienced significant expansion across all business lines, prioritizing the enrichment of higher-value services in discovery, transitioning to integrated services, and broadening the CMC portfolio with a focus on API offerings. With approximately 70% of discovery programs now integrated, spanning biology to toxicology and medicinal chemistry, and a commercial portfolio growth from five to 35 molecules in three years, our involvement in around 10% of all small molecule launches underscores our progress. Despite industry-wide challenges, such as destocking, we have maintained robust growth rates, with a 30% annual increase in the discovery segment and overall company growth surpassing 20%, positioning us ahead of market trends and poised for continued expansion. How does your recent expansion of end-to-end drug metabolism and pharmacokinetics services reflect your commitment to accommodating larger programs?

We have always aimed to provide high-quality DMPK services, but in response to the guidance from our large pharma customers, we have significantly ramped up our efforts over the past year. This involved enhancing our throughput to handle increased compound volumes and improving asset reliability through automation. Our expansion strategy encompasses three key aspects: Broadening our service range, implementing automation to minimize human intervention in experiments, and enhancing compound management for improved data tracking and management for our customers. This expansion also involves nearly doubling the size of our portfolio footprint, covering technology, personnel, and physical space. Can you elaborate on the growth Sai Life Sciences experienced in the US market recently?

2023 was particularly successful for us in the US market. We are currently assessing whether it is more advantageous to further expand in the US or enhance collaboration between our US and Indian sites. Our US facilities primarily focus on introducing new technologies and closely engaging with customers, while the Indian sites handle scaling up operations. We are considering bolstering the capabilities of our Boston labs to tackle more complex and innovative technologies, which we can then implement at scale in India. What are the factors attracting Western firms to foreign contract manufacturers?

Traditionally, China has been a dominant force due to its scale and capacity. Presently, the prevailing sentiment among Western companies is to diversify their manufacturing sources beyond China without necessarily abandoning it entirely. India stands to benefit significantly from this trend, particularly in the realm of manufacturing, as evidenced by the increased attention Sai Life Sciences is receiving. Our investments, facilities, and team in Manchester have positioned us ahead of the competition, enabling us to capture a substantial portion of this shifting demand. Looking ahead, I anticipate a continued trend of Western companies exploring India as an attractive manufacturing destination. Our strength in the UK market further distinguishes us in the industry. How do you assess the operating environment for CDMOs globally?

The evident catalysts for change are reflected in recent funding cycles, signaling a shift towards streamlined operations in response to an unprecedented surge in resource allocation over the past five years, alongside regulatory changes like the IRA, prompting companies to expedite processes for funding acquisition. This dynamic environment emphasizes the need for companies to strive for 'first in class, best in class' status, driving a trend towards faster operations and larger clinical trials with a focus on multi-indication approaches, demanding agility, and a robust R&D foundation for success. While new modalities such as ADCs and peptides present both challenges and opportunities, companies must diversify offerings, invest in high-end talent, and develop new technologies to remain competitive in the evolving CDMO space, where adaptability and innovation are key to thriving amidst a positive market outlook.