As an early-stage CRO, Charles River Labs has escaped the broader damage of its peers and is still steaming ahead in the third quarter with a jump in revenue.
The Wilmington, Massachusetts-based contract research company saw revenue up to $743.3 million, a jump of 11.3% from last year’s third-quarter figures.
The majority of this growth was organic, spurred on predominately from its discovery and safety assessment and manufacturing support segments, with research models and services (RMS) “also contributing,” according to the CRO’s report.
Breaking those numbers down, revenue for the RMS unit was $151.9 million in the third quarter of 2020, an increase of 14.6% from $132.5 million last year.
It said that there was “strong demand” for research models in China, which has rebounded from the COVID-19 pandemic earlier than pretty much every other major economic region.
Demand for research models outside of China also “improved significantly,” Charles River said. “As a result, client ordering trends for research models moved closer to pre-COVID-19 levels during the third quarter, particularly in Europe, but remained moderately below prior-year levels.”
This is also a strong rebound from its second-quarter numbers, which in August put revenue at $682.6 million, an increase of just 3.8% from $657.6 million from the year-ago period, with organic revenue growth at just 1.4%.
RMS was also dragging down the numbers, with revenue dropping by 14.3%. Turning that RMS drag into growth and seeing a big uptick in organic revenue is a strong performance by the CRO in this quarter.
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“Our exceptional third-quarter performance is indicative of several important factors: that our flexible and reliable outsourced solutions resonate with clients even more today than ever before; that our research model clients are already resuming their research activities; that the market environment remains robust; and that we are generating greater operating leverage across our businesses as a result of our efforts to build a more scalable and nimble organization,” said James Foster, chairman, president and CEO at Charles River.
“The COVID-19 crisis has emphasized the strength and resilience of our business model, our differentiated portfolio, and our unwavering focus on the client experience, which collectively are enhancing our position as the leading, early stage contract research organization.
“As our clients focus on scientific innovation and invest more in their preclinical pipelines, we believe we will remain their partner of choice to move their early-stage programs forward.”
The CRO’s shares dipped at the end of October but in the past week have rebounded back by 28% to just shy of $250 a share and hitting a market cap of more than $12.4 billion.