Avid Bioservices Inc (CDMO)

[Protector]

harry crumb, the backlog will not be gone soon. Last announced backlog is to be produced in 2023 and in that same year they will get new orders.

As we have seen now, Nick emphasizes more and more 'production' orders. They are majorly different from the others in that they are recursive (unless of course there is no demand for that drug). HALO is one examples but in the last lot of new orders (that went into the backlog) it was also mentioned that there were production orders in the set.

What happens with Catalent also plays in this market. Catalent (owner of Cook that was our competitor for HALO) has shown that QUALITY & RELIABILITY is more important then just TURNOVER. Now they are closing factories on a moment where the market is crying for capacity! And it is a cascade...they close the factory that they acquired from the Belgian CDMO because their other factory is not able to deliver the input needed for further production.

CDMO goes slow for high quality, high-tech reliable production. They don't carry the many old time reactor capacity with them as do almost all, if not all, their competitors. CDMO itself has converted almost its complete capacity to single use reactors and has build its new labs on a moment that is was more clear and obvious what exactly was needed for those new types of production (such as costa mesa).

I expect a deal with HALO for the construction of a HALO optimized production capacity now that HALO is scoring big time. I see HALO pay/contribute to that to have ABSOLUTE priority on that capacity, in this way making sure that they never stand in the cold.

AIMO