Question-and-Answer Session
Operator
(Operator instructions) We have the first question from the line of Todd Van Fleet, First Analysis. Please go ahead.
Todd Van Fleet – First Analysis
Good morning, guys. I’d just ask you three quick ones if I could. First, Joe, I guess with respect to you decision to focus more on large pharma, if you could talk a little bit more about the strategic thinking in that area.
Josef von Rickenbach
Yes, hi, Todd. I guess in a why it’s driven by demand, meaning we are of the opinion that some of the smaller companies, especially the non-revenue generating biopharma companies are going to have a harder time to fund the kind of programs that they have been funding over the last three or four years. And we also believe that more or less coincidentally I would say that some of the outsourcing patterns of the large pharma companies are going to improve from our perspective, which is to say increase. And so it kind of naturally makes us focus on that segment.
Todd Van Fleet – First Analysis
Okay. Maybe that’s a lead into the next question I had and it was, given what has happened on the financing front, the molecule development with respect to biotech and the number of molecules perhaps coming into the – under the landscape, how do you see that impacting potentially your Phase I operations? So I guess a question on Phase I, how well did it perform in the quarter? And then what’s your outlook for Phase I, given what we see happening in the preclinical side of things?
Josef von Rickenbach
Yes. It’s an interesting question actually. And obviously we have spent a lot of effort to understand the dynamics there. And I say it’s interesting because actually turned out that the demand from the smaller companies continue to be holding up actually quite well in our early stage business. And ironically and interestingly, the demand from the larger companies has declined actually now for several quarters. So we were thinking about why this would be, and I think it is in part because we have seen a portfolio re-organization and reprioritization in the large pharma companies, especially in the early stages, and expect that this would actually change going forward. And we have already seen some signs that that actually will occur.
Todd Van Fleet – First Analysis
Okay, thanks.
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