Jay Mazelsky
President and Chief Executive Officer at IDEXX Laboratories
Good morning, and thank you, Andrew. IDEX delivered another strong quarter to close-out 2024, capped with the initial placements of IDEXX. Our results this quarter exemplified the resilience of our business model, built on the foundation of customer-centric innovation, high-touch commercial execution and a steadfast commitment to growth by advancing the standard-of-care in veterinary medicine. This year, we celebrated significant milestones, including the highly-anticipated launch of IDEX in BeautyX, a groundbreaking cellular analyzer redefining slide-free point-of-care testing. We recently-announced the launch of IDEX CancerDX with canine lymphoma, a transformative oncology screening and aden diagnosis panel that will expand over-time to address the most common canine cancer.
We're also concurrently commercializing three new products and services as part of our Catalyst Technology for life platform and test menu and enabling software. Introductions include pancreatic live testing, a single slide solution already embraced by thousands of clinics. Smart QC, which enables very easy monthly calibration on our chemistry platform and an updated IDEX station with a more modern intuitive interface supporting workflow efficiencies.
IDEXX commercial teams continue to operate at a high-level this year, supporting new business gains, solid net price realization, high-90s percent customer retention levels across major testing modalities and sustained adoption levels of diagnostic testing utilization near post-pandemic highs. High placement levels across our core premium instrument platforms drove a 9% growth in our premium instrument installed-base. The team also delivered very strong year-on-year EVI gains when incorporating benefits from nearly 1,600 global pre-orders for IDEX and VUDX, which will benefit our business over the coming year. 2024 also saw the extension and expansion of three major customer agreements, which will provide solid volume gains for our reference lab business. These important contractual renewals highlight the value IDEX solutions bring to our customers, supporting their practice revenue growth through highly important diagnostic testing categories.
2024 was also a pivotal year for our software business with double-digit growth in our cloud-native PIMS placements and the launch of our pet owner engagement solution Vell, we are helping clinics bridge the gap between patient-care and operational efficiency. Vewel, now adopted by nearly 600 practices has enhanced pet owner engagement by streamlining communication and driving increased clinical visits and diagnostic frequency. These advancements highlight the expanding role of software and unlocking the full potential of diagnostics, while delivering a seamless experience for veterinarians and pet owners alike.
The strong execution was delivered in a dynamic macroeconomic and sector environment, which saw continued pressure on clinical visits. For pets visiting US clinics, pet owners continued to demonstrate interest in a higher standard-of-care, reflecting the strength of the pet owner bond and the prioritization of pet health. Diagnostics play a key central role in enabling better medical outcomes as nearly half of clinical visits include some form of diagnostic testing. The growth in the use of blood work-in preventive screening highlights the value pet parents place on proactive care, driven by advancements in technology and awareness of health benefits.
Our commercial strategy is to support this positive trend through the use of preventive care marketing programs like SimpleStart and testing innovations such as IDEX Cancer DX, which will be included at attractive prices to inspire pull-through. IDEX's commercial execution continues to be a cornerstone of our success, reflecting the deep expertise, commitment and customer focus of our teams around the globe. Our partnership approach has yielded exceptional customer retention rates of over 97%, ensuring that practices continue to see IDEX as an indispensable partner in their growth and efficiency goals.
Customers trust IDEX to help them navigate challenges of staffing and visit trends. Our nearly double-digit premium instrument installed-base growth is driven by robust new placements across chemistry, hematology and platforms as well as the first placements of IDEX. We also continue to make strong progress in placing our IDEX suites in competitive and greenfield accounts, a focus area since we get the full growth benefit of consumables usage. Customers are hungry for point-of-care technology that supports their medical mission with fast real-time results, while minimizing workflow bottlenecks with innovations such as load and go capability, a common easy-to-use interface and instrument uptime measured in years.
An additional benefit is that our large rapidly-growing installed-base of over 74,000 chemistry analyzers, for example, allow for rapid global adoption of new testing innovations such as pancreatic lipase to 10 such menu extension in a bit over 12 years. Menu extensions such as pancreatic lipase help support healthy volume premium to the clinic visit baseline. Our international region showcased strong performance in 2024, contributing significantly to our growth story. Double-digit expansion of our premium installed-base outside the US underscored the benefits of our targeted global commercial investments over the past three years.
Our maturing international sales organization has not only secured high-quality placements, but also driven consistent diagnostic utilization gains, particularly in the Europe and Asia-Pacific regions where we continue to see untapped potential. Spotlighting our European region's very strong performance, we saw the seventh consecutive quarter of double-digit CAG Diagnostics recurring revenue growth with IDEXX consumables growth in the high-teens.
Customer satisfaction remains at the heart of our commercial strategy, supported by sustained sector-leading levels of engagement and trust. IDEX's investment in areas such as VetConnect Plus feature expansion that now gives the customer the ability to access reference lab sample turnaround time and order status information. This is part of our strategy to not only provide subject matter expertise at complementary testing support through our medical consulting organization, but workflow optimization that help clinics navigate the complexities of modern veterinary care. This focus on customer success not only drives loyalty, but also ensures that IDEXX remains the go-to partner for diagnostic solutions.
The launch of IDEX in has been one of the most exciting developments of 2024, marking a new era in point-of-care diagnostics, designed as a technology for life platform. Combines advanced optics, artificial intelligence and a slide-free workflow. We can deliver transformative diagnostic insights with unparalleled easy use. The initial menu focuses on earcytology and blood morphology taps into two clinically well-understood high-volume use cases that benefit from automation and a step-up in testing consistency and performance.
Customer interest for IDEXX and VUDX continues to be exceptionally strong with nearly 1,600 preorders globally by the end of Q4, reflecting the high-demand for this next-generation platform. International interest has been similarly robust as we begin taking orders in select geographies in Q4. So like the US, we have placed some limits on the number of pre-orders our account managers take. This level of enthusiasm underscores the transformative potential of in clinics worldwide., as I mentioned previously, we initiated a controlled launch of IDEX in Q4 and to ensure a best-in-class customer experience, we will gradually ramp-up placements through 2025. Early feedback from customers, both in the customer experience trials and for the initial placements have been exceptionally positive. Customers are simply amazed with how easy the analyzer is to use, eliminating the need for complex slide preparation or interpretation with results in minutes.
Underpinning the financial guidance, Andrew shared is a placement target for 4,500 plus in view placements over the course of the year as we march towards our 20,000 placement goal over five years. IDEX operations and supply-chain teams have made outstanding progress ramping manufacturing to support this level of placements. While our field service representative team has been expanded and trained to provide critical installation capacity to support both the interview ramp and continued growth of our core instrument platforms. The moment is upon us to bring this transformative analyzer to our global customer-base. Looking ahead, we remain on-track to expand IDEXX-AWDX's capabilities further with the addition of fine or F&A testing for lumps and bumps later in 2025, unlocking significant opportunity in oncology diagnostics.
We're excited to have announced that VMX, the March launch of IDEX Cancer DX panel with lymphoma, a pioneering advancement in veterinary oncology. This innovative screening solution represents a significant step forward in companion animal healthcare, addressing a critical need for early cancer detection and as an diagnosis in canine patients. The ADXCancer DX panel has breakthrough cost, performance and turnaround time attributes for early-stage cancer diagnostics screening and as an diagnosis test, price for as little as $15 per test was included as part of select diagnostic panels. This will change how and when canine cancer is detected and its early diagnosis will likely change how cancer care is managed with positive patient implications for the support of longer, healthier lives. Given the performance, cost and turnaround time attributes of the CancerDX panel, the opportunity is to inspire a much broader inclusion of cancer screening as an essential part of the preventive care blood work.
The Cancer panel will initially launch with lymphoma detection, one of the most common and treatable cancers in dogs. Over the next three years, the panel will expand to include the six most prevalent canine cancers, which collectively account for over 50% of cancer cases in dogs. This expanded menu will tap into an estimated $1.1 billion addressable opportunity, underscoring the potential of this diagnostic innovation., our software ecosystem plays a pivotal role in supporting veterinarians by enhancing clinic efficiency, optimizing workflows and fostering deeper connections with practices and pet owners.
With double-digit growth in cloud-native placements, software remains a critical enabler of diagnostic adoption and practice success, reinforcing our position as a leader in vertical SaaS offerings tailored to veterinarian needs. One of the year's standout achievements was the expansion of, our pet owner engagement application designed to address the growing demand for seamless communication and improved visit outcomes. Bell has been embraced by nearly 600 practices at year end, doubling its user base since Q3. Early results from the app's deployment have been highly encouraging with participating clinics reporting increased clinical visits, higher diagnostic usage and improved revenue. This underscores Velo's ability to address critical workflow pain points, while fostering stronger relationships between veterinarians and pet owners.
We have meaningfully increased development resources and investment in Vello through 2024 and now in 2025. Looking ahead, development roadmap promises even greater value with upcoming enhancements focused on streamlining communications, expanding engagement tools, including the ability to personalize messaging and integrating advanced analytics. Customers appreciate our commitment to an integrated diagnostics and software suite in a way that unlocks new opportunities for growth. Beyond, we continue to expand our broader software portfolio. We placed a record number of cloud-native PIMs, expanding that installed-base by 20% year-over-year as our offerings remain a top choice for clinics seeking modern, scalable solutions.
We finished the year with 60% of our PIMS installed-base in the cloud ahead of our estimates shared at Investor Day in August. IDEX, our cloud-native imaging workflow engine, also experienced double-digit subscriber growth, demonstrating its relevance in addressing key pain points such as dental imaging workflows. These advancements not only simplify complex processes, but also allow clinicians to spend more time focusing on patient-care. The integration of diagnostics and software remains a cornerstone of IDEX's value proposition. By providing intuitive, efficient and comprehensive tools, we empower clinics to unlock new levels of performance while delivering superior care to their patients.
As we move into 2025, our focus on software innovation will continue to drive recurring revenue growth and deepen our partnerships with veterinary practices worldwide. Thank you. As we turn the page on 2024, IDEX remains steadfast in its purpose to create exceptional long-term value for our customers, employees and shareholders by enhancing the health and well-being of pets, people and livestock.
I extend my deepest gratitude to our nearly 11,000 employees whose dedication and hard work have made these accomplishments possible. Together, we have delivered robust financial results while setting the stage for a promising 2025 and beyond, supported by a new wave of IDEX innovations. I'd like to thank Brian McKean for the exceptional contributions he has made over a 20-year IDEXX career, spanning both as a member of our Board and over the last 11 years as IDEXX's CFO. As previously-announced, Brian will be stepping down from the -- from the role as CFO as of March 1. One of Brian's many contributions has built has been to build a world-class finance team and develop future leadership talent.
It's my great pleasure to welcome Andrew Emerson, who will become our new CFO as of March 1. Andrew brings more than 20 years of finance experience to the healthcare industry in roles of increasing responsibility, including over nine years at IDEX working side-by-side with Brian throughout this time. He is well-versed in our business, our sector and our strategy, and he is set to contribute on day-one. Brian will remain with IDEX in a senior advisory capacity until his retirement date of June 1, in order to help ensure a smooth and seamless transition for Andrew. With that, I'll turn it back over for Q&A. Thank you.
