CRL · Earnings call · 2026Q2T · Full report

Biotech Funding and Demand

CHARLES RIVER LABORATORIES INTERNATIONAL, INC. · 2026-08-05 · Importance 7 · Surprise 24

Charles River said the biopharmaceutical demand environment continued to strengthen in the second quarter, led particularly by the DSA segment. Small and midsized biotech funding reached nearly $100 billion on a trailing 12-month basis, just below pandemic-era peaks, with resilient IPO, venture-capital and follow-on funding activity. Revenue from small and midsized biotech clients was essentially flat organically, improving from declines in recent quarters, while revenue from global biopharmaceutical clients continued to increase organically. Management expects the improved booking activity from late 2025 and through mid-2026 to begin producing incremental consolidated and DSA revenue growth after the normal several-quarter backlog conversion lag.

Key facts

• CHARLES RIVER LABORATORIES INTERNATIONAL, INC. reports NIH budget has been approved and grants are coming out but are now multiyear, causing some uncertainty for grant holders.
• CHARLES RIVER LABORATORIES INTERNATIONAL, INC. says company formation is growing by 2% and is far off from COVID levels, limiting CRADL growth.
• Trailing 12-month biotech funding was nearly $100 billion, just shy of peak levels achieved during the pandemic.
• The company said it saw a notable increase in IPO activity as well as solid VC and follow-on funding contributing to resilient funding activity to date.