Company: CRL
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001100682-25-000011
Chunk: 99

Company: CHARLES RIVER LABORATORIES INTERNATIONAL, INC.
Filing Date: 2025-02-19
Form: 10-K
Item: Item 7
Chunk 99
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 decreased to $2.0 billion as of December 28, 2024 from $2.5 billion as of December 30, 2023. To enhance operational efficiency within the segment, the global Discovery and Safety Assessment businesses will implement a “One DSA” integrated operating structure. This unification will focus on a combined salesforce and leadership approach, with integrated scientific programming in order to facilitate a more seamless client experience and enhance the Company’s client relationships.

Revenue for RMS increased in fiscal year 2024 due largely to revenue contributions from the acquisition of a controlling interest in Noveprim, as well as increased pricing for small research models. Offsetting this growth, the challenging biopharmaceutical demand environment led to lower revenue for research model services, including Insourcing Solution’s CRADLTM operations. However, CRADLTM continues to be an attractive business model as a cost-effective and flexible solution for clients allowing access to vivarium space without having to invest in internal infrastructure. This flexibility is particularly valuable in the current environment, where organizations are seeking to optimize their research budgets and minimize operational costs. We are confident that research models and services will remain essential tools for our clients’ drug discovery and early-stage development efforts.

Revenue for products and services that support biopharmaceutical clients’ manufacturing activities increased across the Manufacturing Solutions segment in fiscal year 2024. The Microbial Solutions business experienced robust growth as client destocking activity by large biopharmaceutical and CDMO clients was largely completed in the prior year. The growth was further driven by higher revenue of our rapid microbial testing solutions, primarily for Endosafe® testing consumables and instruments. Our Biologics business benefited from improved volumes for biologics quality-control testing services, as well as increased demand for our cell and gene therapy CDMO services during the year. Since the strategic acquisition of the CDMO businesses in 2021, Cognate and Vigene, significant steps have been taken, such as establishing Centers of Excellence for cell therapy, viral vectors, and plasmids, to support the emerging modalities and technologies enhanced operations and capabilities. However, in December 2024, our Biologics business experienced the loss of certain key customers, ultimately resulting in a reduction in its long range financial outlook. As a result, the Company expects lower revenue from commercial clients to impact its CDMO business in 2025. 

In response to recent trends observed across each of our businesses, we have undertaken and will continue to implement restructuring actions at