(Reuters) – Contract research firm IQVIA Holdings lowered its annual revenue forecast on Thursday due to a stronger dollar and reported a quarter-over-quarter fall in a closely-watched metric, sending shares down nearly 4%.
The company expects 2024 revenue of $15.33 billion to $15.58 billion, versus its previous forecast of between $15.4 billion and $15.65 billion, as a strengthening dollar hit sales in its large international market.
In the first quarter, IQVIA’s adjusted profit of $2.54 per share beat LSEG estimates of $2.48, helped by strong sales in its largest unit, research and development solutions, which provides contract research facilities for biopharmaceutical companies.
However, the unit’s book-to-bill ratio, which represents number of orders received to those completed, was 1.23x, including the cancellation of a large central nervous system program. It had reported 1.31x in the fourth quarter of 2023.
Contract research firms have been witnessing sluggish demand for their services as elevated interest rates squeezed funding among biotech clients for at least past two years, prompting them to put some drug development programs on the backburner.
William Blair analyst Max Smock wrote in a note the net book-to-bill ratio for the quarter implies net bookings stepped down roughly 1% year-over-year in the quarter.
Revenue in the R&DS segment rose 3.4% to $2.1 billion, above estimates of $2.06 billion.
The Durham, North Carolina-based company reported a 2.3% rise in first-quarter revenue to $3.73 billion, versus analysts’ estimate of $3.70 billion.
(Reporting by Vaibhav Sadhamta; Editing by Krishna Chandra Eluri)
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