IQVIA Holdings Inc. (IQV) Q2 2020 Earnings Call Transcript

IQVIA Holdings Inc. (NYSE: IQV) Q2 2020 earnings call dated July 22, 2020

Corporate Participants:

Andrew Markwick — Senior Vice President, Investor Relations and Treasury

Ari Bousbib — Chairman and Chief Executive Officer

Michael McDonnell — Executive Vice President and Chief Financial Officer

Ron Bruehlman — Executive Vice President and interim Chief Financial Officer

Analysts:

George Hill — Deutsche Bank — Analyst

Tycho Peterson — JP Morgan — Analyst

Robert Jones — Goldman Sachs — Analyst

Patrick Donnelly — Citigroup — Analyst

Eric Coldwell — Robert W. Baird — Analyst

Presentation:

Operator

Ladies and gentlemen, thank you for standing by. At this time, I would like to welcome everyone to the IQVIA Second Quarter 2020 Earnings Conference Call. [Operator Instructions].

Thank you. I would like to now turn the call over to Andrew Markwick, Senior Vice President, Investor Relations and Treasury. Mr. Markwick. Please begin your conference.

Andrew Markwick — Senior Vice President, Investor Relations and Treasury

Thank you. Good morning, everyone. Thank you for joining our second quarter 2020 earnings call. With me on the call today are Ari Bousbib, Chairman and Chief Executive Officer; Michael McDonnell, Executive Vice President and Chief Financial Officer; Ron Bruehlman, who will be Mike’s successor, as of August 1st; Eric Sherbet, Executive Vice President and General Counsel; Nick Childs, Senior Vice President, Financial Planning and Analysis; and Jen Halchak, Senior Director, Investor Relations.

Today, we will be referencing a presentation that will be visible during this call for those of you on our webcast. This presentation will also be available following this call, on the Events and Presentations section of IQVIA’s Investor Relations website at ir.iqvia.com.

Before we begin, I would like to caution listeners that certain information discussed by management during this conference call, will include forward-looking statements. Actual results could differ materially from those stated or implied by forward-looking statements, due to risks and uncertainties associated with the company’s business, including COVID-19 impacts, which are discussed in the company’s filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K and subsequent SEC filings. In addition, we will discuss certain non-GAAP financial measures on this call, which should be considered as supplement to and not a substitute for financial measures prepared in accordance with GAAP. A reconciliation of these non-GAAP measures to the comparable GAAP measures is included in the press release and conference call presentation.

I would now like to turn it over to our Chairman and CEO, Ari Bousbib.

Ari Bousbib — Chairman and Chief Executive Officer

Thank you, Andrew, and good morning everyone. Thank you for joining our second quarter 2020 earnings call. Before we get to the results, I’m sure you all saw the announcement last night, and so this will be Mike’s last IQVIA earnings call, and so I wanted to take the opportunity to thank him for his service and wish him well in his new role at Biogen. I also want to thank Ron and welcome him back, he really never left, but I want to thank him for agreeing to serve as our Interim Chief Financial Officer until we decide on a permanent successor. Many of you already know Ron, and I’m sure you are delighted to welcome him back to the CFO chair.

Now to our results; revenue, adjusted EBITDA and earnings all came in above our guidance ranges. Today, we are also updating our guidance for the year and raising our full year revenue, adjusted EBITDA and earnings ranges. Before we review the numbers, I’d like to give you a quick operational update. During the second quarter, we saw gradual improvement in the accessibility of clinical research sites in the R&D solutions business, pretty much in line with what we told you three months ago. Global site access improved to approximately 20% in April, to 40% at the end of June. Average site accessibility for the second quarter was about 30%, again in line with the assumption that we made, when we set our second quarter guidance. The progress of global site reopenings is continuing into the third quarter, and today, it’s at 53%. I should point to add the progress has been slowing somewhat in the past couple of weeks, as a result of several localized COVID-19 flare-ups in geographies around the world, and especially, in parts of the United States.

As sites have become accessible, we’ve seen an improvement in the number of onsite monitoring visits. In fact, on site visits are now exceeding the number of remote [Technical Issues], remote visits have reduced from the peak in the second quarter. Of course, wherever sites are still inaccessible, our ability to deliver solutions like remote monitoring and virtual trials remains critical to ensuring trial continuity.

Now, patients who are already enrolled in trials, have slowly begun returning for in-person treatment. As you would expect, this varies by therapeutic area. For example, oncology patients are returning at a faster rate than dermatology patients. Also, the recent outbreaks in parts of the U.S. have hampered the pace of recovery in the number of patients enrolled in trials, who are willing to come in for in-person treatment. For trials that have not yet started, the pace of site startup and patient recruitment has obviously been slow. It’s improving, but still slow. For example, patient recruitment for new trials, which had been virtually halted during the second quarter, has resumed over the past few weeks, and is now at about 25% of normal baseline enrollment levels. We expect this to continue to improve over time.

R&DS and business development activity has remained very strong. We still have not had any material cancellations of trials in our backlog, due to COVID-19. Interactions with clients, such as Big Defenses continue, as clients adjust to working virtually. RFP volume and value continue to hold at basically similar levels to 2019. And of course, the R&DS team has been awarded a wide range of COVID-19 vaccine therapeutics and related lab work. Of course, you will have seen, we announced a collaboration with AstraZeneca last week, to accelerate development of a potential COVID vaccine.

COVID-19, more broadly has accelerated interest in our virtual trials solution, including Study Hub. Awards for our virtual trial solutions have actually doubled, albeit of a relatively small base. We are leveraging our virtual trial technology platform, Study Hub, to deliver a seamless patient experience. As you know, the platform combined eConsent telemedicine, eCOA and digital communication.

Moving to Technology & Analytics; we continue to have very little interruption in data supply or demand. Our data production centers around the world remain fully operational, and our Technology & Analytics deliveries continue in the ordinary course. Selling activities have started to resume, as clients have adjusted to working virtually as well. There is still some delayed decision making for ad hoc services work, but we’ve had real good momentum in our fastest growing businesses, such as Real World and Tech.

Our Real World business continues to expand even in this environment, with strong growth in the quarter. As a reminder, the results of our Real World business are reported in our TAS segment. So unlike our CRO peers, this growth is not included in R&DS results.

In the Technology, space OCE has added 35 new clients so far in 2020. OCE deployments continue to progress as scheduled, as clients look to accelerate their usage and get up and running on the platform even faster. We now have 115 customers that have chosen OCE, and they represent over 60,000 potential users of the platform. Most of these customers are still in the early stage of deployment. So far, our win rate in this segment when going head-to-head against the incumbent, is approximately 70%.

Finally, in our CSMS business, we’ve not experienced any material cancellations. Although, as expected, we’ve experienced softer demand for field reps, which of course impacts revenue. Additionally, business development has slowed considerably in this segment.

Let’s now review the second quarter results. Revenue for the second quarter came in at $2.521 billion, which is a $118 million above the midpoint of our guidance range. Now $41 million of this $118 million beat, came from FX and pass-throughs. Second quarter adjusted EBITDA was $483 million, with a $25 million beat versus the midpoint of our guidance, and this came entirely from better operational performance. Second quarter adjusted diluted EPS was $1.18.

Second quarter R&DS contracted backlog, including pass-throughs grew 13.5% year-over-year to $20.5 billion at June 30, 2020. We saw good growth in awards for our large pharma clients, as well as our EBP clients in the quarter. We had broad based booking strength by offering, with particular strength in full service clinical and in lab. The contracted net book-to-bill ratio including pass-throughs was 1.64 for the second quarter of 2020, and excluding pass-throughs, the second quarter contracted book-to-bill ratio was 1.60. The LTM contracted book-to-bill ratio at June 30 was 1.43, including pass-throughs and 1.42 excluding pass-throughs.

As we said previously, we’ve continued to make every effort to preserve employment during this crisis and to the extent possible, we have not affected based compensation for our employees. Of course, we’ve worked to reduce other costs and discretionary spend and as a result of these actions, our adjusted EBITDA came in well above our expectations. You can see, when you adjust for pass-throughs and FX, that the drop through incremental margin on the revenue beat was over 30%. So far, even considering several flare-ups around the world, things seem to be moving in the right direction. Sites are reopening globally, allowing us to resume our critical work in R&DS. We continue to be cautiously optimistic, and we anticipate a sharp recovery in the back end of the year. Mike will review in more detail how we see the second half playing out.

Finally, a quick update on our 2021 planning process. As I’ve already shared with you, we started this process earlier than usual and our plan is to provide 2021 guidance before the end of this year. Given the positive trends we’ve seen in operational execution and client demand, together with catch-up work and the associated change orders that we currently anticipate, as well as the COVID awards, we remain optimistic that in 2021, we will see a return to our previous growth trajectory.

Now, I’ll turn it over to Mike for some more detail on the quarter, how we see the second half of the year play out, and the upward revisions to our guidance.

Michael McDonnell — Executive Vice President and Chief Financial Officer

Thank you, Ari, and good morning everyone. Turning first to revenue; second quarter revenue was $2.521 billion compared to $2.740 billion in the second quarter of 2019. First half revenue was $5.275 billion compared to $5.424 billion in the first half of 2019. Second quarter revenue in Technology & Analytics Solutions was $1.109 billion compared to $1.102 billion in the second quarter of 2019. First half Tech & Analytics Solutions revenue was $2.226 billion compared with $2.177 billion for the first half of 2019. R&D Solutions second quarter revenue was $1.235 compared with $1.435 billion in the second quarter of 2019. First half revenue in R&D Solutions was $2.676 billion compared with $2.851 billion in the first half of 2019.

Second quarter contract Sales & Medical Solutions revenue was $177 million compared with $203 million in the second quarter of 2019. First half contract Sales & Medical Solutions revenue was $373 million compared to $396 million in the first half of 2019.

Turning now to profit, adjusted EBITDA was $483 million for the second quarter, and $1.045 billion for the first half. Second quarter GAAP net loss was $23 million, resulting in a $0.12 loss per diluted share. For the first half, we had GAAP net income of $59 million or $0.30 of earnings per diluted share. Adjusted net income was $229 million for the second quarter or $1.18 per share. Adjusted net income for the first half was $523 million or $2.68 per share.

Let’s now turn to R&D Solutions backlog; closing backlog grew 13.5% to $20.5 billion at June 30, 2020. New business wins remain strong and to-date we have experienced no material COVID-19 related cancellations.

Let’s now review the balance sheet; at June 30, cash and cash equivalents totaled $1.1 billion and debt was $12.1 billion, resulting in net debt of approximately $11 billion. As of June 30, 2020, our net leverage ratio ticked up slightly to 4.8 times our trailing 12 month adjusted EBITDA, as a result of the COVID-19 related impacts on our first half adjusted EBITDA. As a reminder, we continue to be committed to bringing our leverage ratio to a range of 3.5 to 4 times, as we exit 2022.

Cash flow from operating activities was $472 million in the second quarter and $635 million year-to-date. Capex for the quarter was $142 million, $283 million year-to-date, and free cash flow for the quarter was $330 million or $352 million year-to-date. As you know, when the COVID-19 outbreak became a pandemic in March, we temporarily suspended share repurchase activity. Accordingly, we did not repurchase any shares in the second quarter, and as of June 30 of 2020, we had approximately $1 billion of share repurchase authorization remaining. We will continue to evaluate the right time to reinitiate our share repurchase program.

We continue to have strong liquidity. At June 30, we had $1.1 billion of cash on the balance sheet and our $1.5 billion revolving credit facility was undrawn. We also have over $1 billion of EBITDA cushion, relative to our leverage and interest coverage maintenance covenants, even as our first half adjusted EBITDA has suffered a significant and unusual impact from COVID-19. And finally, I would point out that we have a lot of flexibility with capital allocation, which includes capex, M&A and share repurchases.

And now, let’s move to guidance; on our first quarter earnings call, we outlined our assumptions regarding the global progression of the virus, the percentage of clinical research sites accessible to us throughout 2020, and our ability to interact with clients to support business development activities. These assumptions supported our 2020 guidance provided at that time. During the second quarter, it became apparent that the global spread of the virus would become wider and more prolonged than we had assumed. However, the percentage of sites accessible to us, tracked in line with our expectations, and business development activities have progressed, better than our original assumptions. We also had made the assumption at the time that 100% of clinical research sites would be accessible by the beginning of the fourth quarter. However, given localized flare-ups around the world, we now see this happening more at the beginning of 2021. But, in spite of this, we have been able to overcome restricted site access better than we initially thought, through work around, including the use of our remote capabilities.

Based on our better than expected performance in the second quarter, the company’s ability to execute in this environment, incremental COVID-19 trial work and evaluation of current business conditions and outlook for the balance of the year, we are now forecasting better performance in our TAS segment and better execution against our R&DS backlog than previously anticipated.

Together, these factors are expected to contribute to improved financial performance in 2020, versus the company’s expectations on April 28 of 2020. As a result, we are raising our full year guidance ranges for the full year. We now expect full year revenue to be between $11 billion and $11.100 billion, which represents an increase of approximately $290 million at the midpoint, of which approximately 20% represents a favorable FX impact based on exchange rates, as of the end of the second quarter. Please note that FX still represents a year-over-year headwind of 60 basis points on our average revenue guidance. At the midpoint of the new guidance range, the constant currency growth represents slight growth year-over-year. For full-year profit, we expect adjusted EBITDA to be between $2.295 billion and $2345 billion and we expect adjusted diluted EPS to be between $6.10 and $6.30. This guidance assumes foreign currency rates at the end of the second quarter remain in effect for the rest of the year.

Now turning to guidance for the third quarter of 2020; assuming FX rates at the end of the second quarter remain constant through the end of the third quarter, we expect revenue to be between $2.725 billion and $2.775 billion. Adjusted EBITDA is expected to be between $564 million and $582 million, and adjusted diluted EPS is expected to be between $1.47 and $1.55.

So in summary, we delivered second quarter revenue, adjusted EBITDA and adjusted EPS, all above the top end of our guidance ranges. We are seeing encouraging signs of a migration back to normal business conditions by the end of the year. We are utilizing our unique capabilities, to help in the fight against COVID-19 globally. We have raised our guidance for the full year, and we are already planning for 2021, in anticipation of a return to our growth trajectory.

And finally, as Ari mentioned at the start of the call, this is my last earnings call at IQVIA. I’m very grateful for the opportunity to serve as IQVIA’s Chief Financial Officer since our merger. It has been a privilege to work with Ari and the executive leadership team. I have learned a lot over the past four years, and I am incredibly proud of what we have accomplished. I firmly believe IQVIA is incredibly well positioned to achieve its Vision ’22 ambitions. I intend to remain a shareholder in the company and will; be rooting for its continued success.

And with that, let me hand it back to the operator for Q&A.

Questions and Answers:

Operator

[Operator Instructions]. Your first question comes from the line of George Hill from Deutsche Bank. Your line is now open.

George Hill — Deutsche Bank — Analyst

Yeah. Good morning guys and thanks for taking the question. You covered a lot. I guess the first question I would ask is, have you seen any change in the competitive environment as it relates to COVID-19? And I know you haven’t had any cancellations, and the win rate has been strong. But I guess just talk about how the selection process is going and whether you guys think you’re taking share?

Ari Bousbib — Chairman and Chief Executive Officer

Thank you, George. Good morning. Again, when we refer to no material cancellations related to COVID-19, we are speaking about cancellations of trials that were already in the backlog and not for COVID, for other things. And it just points to the resilience of our customers and their long-term view. They haven’t changed their priorities and they are still focused on the diseases that they we’re focused on before the crisis emerged.

With respect to COVID-19 itself, we’ve won a wide variety of the trials, ranging from a small lab work or all the way to wide vaccine trials, a number of those are, I mean are well-publicized. There are a few large ones. Some of them are nominal fees relating to the public reviews for small biopharma companies. There are multi-million dollar vaccine trials. There are currently two vaccine trials that are funded by the U.S. government, so Operation Warp Speed which we have won, one of which we mentioned, I mentioned in my introductory remarks, which is the one with AstraZeneca. So in terms of competitive wins, I think the crisis has shown that our unique capabilities are highly, highly differentiated. All I can say is, we’ve become a lot closer to the customer base during this crisis. With many of them, we had weekly forums, we’ve got extraordinary feedback from our customers, in terms of the criticality of the information we were providing them in real time, for their own decision-making process, and we’ve continued to win at a very high pace.

I believe that we’ve continued to gain market share and certainly, we gained a significant amount of the overall COVID-19 work out there. And I want to point out, that this COVID-19 related work is — we are contributing as well to the resolution of the crisis, and so in many cases, because these are government sponsored, we are discounting those. So they are important, and they are going to continue to play a role in the in the foreseeable future here and they were a part of our bookings in the quarter, I believe it represents somewhere in the teens, of our service bookings in the quarter, sort of mid-teens or so. And so, it’s not a negligible piece of our dollar booking. But it’s not, it wasn’t a make it or break it kind of activities.

George Hill — Deutsche Bank — Analyst

Thanks. And maybe if I could ask Mike, a quick follow-up, and Mike, you’re going to be missed here at IQVIA. Remote monitoring has played a huge part of the process, as we’ve gone through the COVID crisis. I guess, can you talk a little bit about the financial implications of moving to remote environment versus the on-site environment?

Ari Bousbib — Chairman and Chief Executive Officer

Are you asking about the remote environments versus — yeah, I mean, look we, as I said in my remarks, the remote monitoring obviously is where everyone went, and you know this, because we could simply not access the sites. I think that, as I said in my remarks, on site visits have replaced or have now overcome the number of remote visits. The peak of those remote visits were some time in the May-June timeframe and now, we have started accelerating in a steep fashion, the number of actual visits. We — still not to our normal pace, but it has dramatically increased. As I said 53% of the sites are now accessible, and we are able to visit those sites. Bear in mind, while remote is helpful and we are — we are using it mostly to meet obligations to patients and clients and to ensure their safety etc. But again, it’s important to know that in-person site visits are still required, in order to meet the source data verification criteria. The — each trial budget, of course, will have to be revised accordingly. So we see this as more of an opportunity as well, as we go back to sites. Thank you, George.

George Hill — Deutsche Bank — Analyst

Thank you.

Operator

Your next question comes from the line of Tycho Peterson from JP Morgan. Your line is now open.

Tycho Peterson — JP Morgan — Analyst

Hey, thanks. Appreciate all the color. I guess Ari, on the reopening of sites, I am just curious about how much risk you see in the flare-up of cases to now heading into 3Q and the back half of the year? And are there implications you know to R&DS and CSMS for your business? And are there steps you can take in anticipation of some of this, to try to mitigate the impact?

Ari Bousbib — Chairman and Chief Executive Officer

CSMS. Did you mentioned CSMS or?

Andrew Markwick — Senior Vice President, Investor Relations and Treasury

Yeah. Can you say that again?

Ari Bousbib — Chairman and Chief Executive Officer

What’s the question?

Tycho Peterson — JP Morgan — Analyst

The question was about the flare-up of COVID cases and the risk heading into 3Q in the back half of the year, the steps you could take mitigate some of that in advance and then just any, where you would see more impact?

Andrew Markwick — Senior Vice President, Investor Relations and Treasury

Is that Tycho we’ve got? Or is that George still?

Tycho Peterson — JP Morgan — Analyst

No, it’s Tycho.

Andrew Markwick — Senior Vice President, Investor Relations and Treasury

Tycho, sorry. We’re having trouble hearing on our end.

Tycho Peterson — JP Morgan — Analyst

The question is about the flare up in COVID cases and risks for 3Q in the back half of the year and are there steps you can take to mitigate some of the impact, as cases are going back up in a number of regions?

Ari Bousbib — Chairman and Chief Executive Officer

Yeah, I mean look, there is flare-ups out there, Texas, Florida, California and South Carolina. Around the world, Europe and certainly Asia is pretty much back up, to not quite 100%, but not that far. The main issue here is, in some parts of the United States. But again, we don’t disclose exactly which sites or where, but you should know that — it’s not going to be that material, these flare-ups in the U.S. to our — we have over 100,000 sites globally, and we’ve become very adept at transitioning to remote monitoring. So I think, yeah, I mean we now have been able during the second quarter, to adapt, and we have a number of walk-arounds using our remote capabilities, and so we feel that these assumptions that we made for the third quarter, better educated than the ones that we made three months ago with the crisis.

I should point out, that these assumptions that we made — you know many folks out there thought that we were getting ahead of our — optimistic about those assumptions and the fact is, the progression of sites accessibility as a metric was exactly — exactly as we predicted. We based that on the course of the disease in China and other geographies that were more, that had been ahead of the rest of the world in terms of the disease, and we based that also on our own internal data and modeling that we are using to project our business. So once again, while people thought we were overly optimistic, so that we were exactly on target with respect to site accessibility, and in fact not so optimistic. So I think I’m not suggesting that, because we were right three months ago, we are right now for the next few months. But I think we — if anything, I believe we are a little bit more educated now, and our models are even more precise, than they were three months ago.

Tycho Peterson — JP Morgan — Analyst

And then, Ari, one follow-up, you talked about a return to normal growth next year, 15% growth off $6.30 — where either $7.25 is essentially where consensus is. Is that the right way to be thinking about it for next year?

Ari Bousbib — Chairman and Chief Executive Officer

I said that we were going to give guidance for ’21 much earlier than before, than usual, that is, you know, not at the beginning of the year, but more this year for next year and that is because as you correctly point out, we have visibility. We have more visibility than usual, because we know the work that should have been done this year, that still in our books that we need to progress, plus the work that we won this year, so we have more visibility. I’m not going to give you any numbers, I will let you speculate, but hopefully in the not too distant future, I mean, I don’t know if you’d be able to [Indecipherable] in the third quarter, but maybe we should have that have that as a goal. Okay. We are, we are, we have — thank you.

Tycho Peterson — JP Morgan — Analyst

Okay, thank you.

Operator

Your next question comes from the line of Robert Jones from Goldman Sachs. Your line is now open.

Robert Jones — Goldman Sachs — Analyst

Thanks for the questions. And yeah, Mike, definitely enjoyed working with you. Good luck in the next endeavor, and Ron, look forward to engaging. I guess maybe Ari, just on that last line of questions, but maybe to put some numbers around it, the second half revenue guidance looks like it implies about 2% year-over-year growth in total revenue over the back half of ’19. But you updated the NTM revenues, I think up 10% versus the last [Technical Issues]. Is that — does that dynamic get at what you just commented on that you have just better visibility into the backlog, in what could come out of the backlog in the first half of 2021?

Ari Bousbib — Chairman and Chief Executive Officer

Yeah, Andrew do you want to…

Andrew Markwick — Senior Vice President, Investor Relations and Treasury

Sure, I mean the next 12 month revenue from backlog increased considerably quarter-over-quarter, it was $4.9 billion at the end of Q1, and now its $5.4 billion, it was a large sequential move and I think that the ultimate forward-looking indicator for future revenue growth and the trajectory of the business. So we are very pleased with that. I think obviously we still want to that dig into our plans and we’ve started that process, as Ari said earlier, and we’re looking forward to providing 2021 guidance, but I think…

Ari Bousbib — Chairman and Chief Executive Officer

Yeah. Bob, I think you’re thinking about it the right way. Part of this is the fact that, as you know, we won I believe, a disproportionate piece of the market over the past year or so. And those market share gains have translated into a big proportion of our backlog, that’s new wins that are having started. And so a big piece, which is why you saw the revenue conversion being slower than usual, even without the COVID-19 crisis, that’s because spiked start-up activity is typically a little slower. Patient enrollment is a little slower. The vast majority of our of our book of business is not in the sweet spot, so to speak, where the trial is ongoing. And so the COVID-19 crisis has added to this issue, because when you think about the impact of the crisis on trials, for patients that were already enrolled, and for trials are in that phase, where you are really — where you are really in the sweet spot and executing the trial and patients within sites, then we worked around that. You can work around with remote monitoring, and now we are returning patients to sites etc. But sites that have not started yet, site startup activity is — was much more difficult, simply because people were just not at work, and we were able to get this site up and running. So that has been delayed and it has kind of slowed down a bit.

Similarly patient enrollment was more difficult and is more difficult. We are now enrolling, as I said in my introductory remarks, patients back into trial. But we still are only at 25% of normal baseline number of patients recruited per week. So it’s going up, and we are catching up. And I think that’s part of why you see more revenue pushed back into the next 12 months. That’s kind of the pent-up, if you will, revenue that should have been executed, that’s now going to be executed. And that’s in addition of course to the change orders for the work that needs to be done. I mentioned before, we need to do on-site data verification. So despite the remote visits, a piece of the work still needs to be done on site. So that’s additional. And then finally, we continue to book at a very high base, as shown by our high book-to-bill ratios, as all of that adds up to what we believe is the expected next 12 months revenue from backlog.

Robert Jones — Goldman Sachs — Analyst

No, that all makes a ton of sense. And I guess maybe just a quick follow-up, Ari on TAS, maybe just — I know you touched on some of the elements there in the prepared remarks. But clearly better performance than many expected. What are clients specifically utilizing within the segment? I know there’s a lot of components there. Is it the analytics for virtual meetings? Is it more safety studies? Just trying to get a better sense of what was driving the performance in TAS?

Ari Bousbib — Chairman and Chief Executive Officer

Yeah, I mean look the usual thing, data technology, real world, as well. I mean, why don’t — Ron, do you want to?

Ron Bruehlman — Executive Vice President and interim Chief Financial Officer

Yeah. Look, the strongest part of the TAS segment has been and remains Real World. We’ve also seen continued implementations in the tech sector, that’s gone well. Analytics Solutions actually has been strong, although there have been some delayed client decisions as a result of COVID. So I would say across the board, but the particular strength that we see is in Real World.

Ari Bousbib — Chairman and Chief Executive Officer

And again, the weakness in TAS we said before, is the part of the business where we help clients organize face-to-face meetings with physicians, healthcare professionals around the world, the conference business, that required in person, and that has essentially dried out. It’s beginning interestingly to show signs of revival. People are scheduling conferences in the next few quarters. So that’s going to come back. But certainly, it has been a largely brought to a hold, and that has created a hole in our revenue, which is why that hasn’t performed as greatly as — everything else I think is on…

Ron Bruehlman — Executive Vice President and interim Chief Financial Officer

And data remains very solid.

Ari Bousbib — Chairman and Chief Executive Officer

Very stable. Yeah.

Robert Jones — Goldman Sachs — Analyst

Thank you.

Ari Bousbib — Chairman and Chief Executive Officer

Thank you.

Operator

Your next question comes from the line of Patrick Donnelly from Citi. Your line is now open.

Patrick Donnelly — Citigroup — Analyst

Great, thanks guys. Maybe just a follow-up on the TAS question there. Certainly appreciate Real World doing well. Can you just give us a bit more color on OCE? I know you kind of noted 35 new clients so far in 2020. Can you just discuss how that’s trending relative to your expectations? And then again, maybe some of the feedback you’re getting from customers that are either converting over to you, or kind of competitive wins, what you’re hearing about the offering there?

Ari Bousbib — Chairman and Chief Executive Officer

So again, the team has really performed very well. We have crossed the 100 customer mark, and now, we are at 115 wins. We continue to see a lot of success. Generally with a handful of exceptions, we did not see any slowdown in implementation. Actually in many cases, accelerations of implementations. We went live for several deployments, including, by the way, in the midst of the crisis, I remember seeing — I think I saw an email somewhat from a — one of our large, large, large clients, congratulating the team for an amazing job they did on deploying in Spain, in the middle of the peak of the COVID crisis over there. So things have tended to go very well on our deployments.

Generally, the demand for remote detailing continues to rise. We’ve got a module within OCE, called OCE Remote Detailing, which is the most secure compliance platform in this space. We also launched last quarter, our compliance solution in the commercial space. HCP Engagement Management, which already had four wins, and a strong pipeline has been building. So I think it’s all going very well, according to expectations and frankly for OCE, we haven’t seen any — we will get a handful of slowdowns, in terms of some areas of the world, we couldn’t really deploy. But on the other hand, we’ve seen acceleration. So it’s essentially going as well as we could have expected.

Patrick Donnelly — Citigroup — Analyst

Okay, great. And then maybe just one on the margin side, and you guys did a pretty good job insulating the bottom line from some of the revenue headwinds, you were pretty quick condition cost controls. I know you talked about planning for 2021 already. I guess how should we think about some of the costs that have come out? Are those going to come back in terms of your planning? Are you feeling good enough to your point there, Ari? I think you talked a few times about the visibility. Now that you’re more comfortable there, are you kind of easing on some of the cost controls? Maybe just help us think about kind of the margin cadence on a go-forward, the cost control measures that you have in place? Thank you.

Ari Bousbib — Chairman and Chief Executive Officer

Yeah. I mean you want to, Ron, you want to…

Ron Bruehlman — Executive Vice President and interim Chief Financial Officer

Yeah, sure. Well, look, obviously there’s some margin pressure in the first half due to the drop in revenue and how quickly we could get costs out, more so early on than later on, We should see margin expansion in the second half of the year, as the business comes back. We’ve taken a lot of costs out. I don’t think all of it’s going to come back. Certainly, we’re going to continue to try to keep pressure on keeping T&E costs down, and I think naturally they will, in this COVID crisis, and we’re always looking to take out — to improve efficiency wherever we can.

One of the things we’ve looked at very carefully other than T&E, which obviously has fallen off is, renegotiating vendor contracts, reducing third party spend, and we’re reassessing our office space needs, which I think a lot of companies are doing right now. So I think the cost trends will be positive going forward as well, margin progression.

Ari Bousbib — Chairman and Chief Executive Officer

Yeah, I mean, again you can see we have a large cost base. And so, god forbid, the situation becomes worse, there are many levers that we can use to mitigate impact to profit. And again I want to emphasize, we have not taken any, virtually no action with respect to employment. There are very-very small pockets, really affecting the few hundred employees, where there were furloughs, or there were a few restructurings. But nothing out of the ordinary course. Nothing dramatic, and we do not plan to do so. And the reason for that is, again, we are a people based business, we are a services company and we want to protect our employees. We know they’re going through difficult times. And then secondly, we do expect a V-shaped recovery and a very strong — here I’m talking about 2021, I did not want to, but we expect a strong 2021 and we are going to need our very talented employees. So we didn’t take any base compensation or restructuring actions as a result of the crisis.

Patrick Donnelly — Citigroup — Analyst

Great, thank you very much.

Operator

Your next question comes from the line of Eric Coldwell from Baird. Your line is now open.

Eric Coldwell — Robert W. Baird — Analyst

Thanks, good morning. Mike, good luck with your future endeavors. Couple of quick questions here. First off, I heard in the Q&A, a mention of particular strength in real world evidence. Last quarter, I believe you highlighted that RWE could be a Tale of Two Cities, prospective and retrospective work. With the prospective work looking more like trials, there could be some headwind. What changed there, if anything, or what were the dynamics between the old IMS-RWE and the old Quintiles RWE business mix?

Ari Bousbib — Chairman and Chief Executive Officer

Well, that’s very, it’s very — okay, I don’t want to flatter you, but it’s a very thoughtful question, and you’re right to your understanding why we are doing well in Real World. And that is that, the ability to use patient level data, which I’ll remind you, is really an unparalleled asset at our company. We have now — we did over 800 million patient lives, unique patient lives, which have been extremely useful. The unique E360 technology capabilities enable us to conduct a lot of retrospective studies, and that part of the business has been extremely strong.

The second factor is that, while access to sites has also been restricted, but it is less restricted than clinical trial sites. To a degree, there are many real world studies, where the sites are actually doctor offices, as opposed to hospitals and those have tended to have — while restricted still, and many of them were shut down as you know, but physical access was better than we would have thought. And the experience has proven that the site accessories for Real World is somewhat better than for clinical trial sites. So as a result, Real World has done, again, better than we would have expected.

Bear in mind also, when we report site accessibility metrics, we only report for clinical trials. And as you know our competitors, our CRO peers report those numbers in aggregate.

Eric Coldwell — Robert W. Baird — Analyst

Yeah. Helpful. Thank you. IQVIA is one of two companies in the space that reports authorizations on a contracted basis. I think there were some speculation that, you could have strong awards, but maybe contracts would be pushed out, given the global uncertainty and clients putting out fires. Clearly that was not a big headwind. But I am curious, what is the normal lag from award to contract at IQV? My hunch would be maybe a couple of months, but I’d love to hear your thoughts? And then how has that changed in this COVID environment? We know the COVID specific trials are being contracted extremely quickly, but have you seen other changes in the duration between award and contract time?

Ari Bousbib — Chairman and Chief Executive Officer

Well, your general assumption is correct. Okay. You’re — kind of two months lag time. We’re trying to reduce that, but that kind of 60-day period is a good assumption. The lag between booking and revenue could be up to 12 months. Okay. So the lag between award and contracting could be up to 60 days, 30 to 60 days, let’s say, and the lag between booking and revenue, it could be up to 12 months — six months to 12 months, depending on the client, the study dynamics. Of course the COVID situation has pushed that lag between booking and revenue further, simply because we were unable to get sites started. But we are getting back into it as we speak, and certainly in Asia, we are already back up to normal and we expect that to happen with the three to six month lag in the rest of the world, Europe and then U.S. So yes, I mean it has created some delays in execution.

On the other hand, as you suggested, COVID-19 trial are much faster burn. It has partially begun to offset that.

Ron Bruehlman — Executive Vice President and interim Chief Financial Officer

Eric, one thing, first awards and contracted bookings were very strong in the quarter. So either way you look at it…

Ari Bousbib — Chairman and Chief Executive Officer

Yeah. Ron makes a good point. I mean I don’t want to — you remember the old way of reporting book-to-bills which was basically on awards. And if we had done that this quarter, it would be having significant — materially higher than the 1.64, materially high.

Eric Coldwell — Robert W. Baird — Analyst

Very helpful. Last one, just a clarification. There were some phone issues in one of your earlier responses. Did I hear you say that COVID work in total across therapies and vaccines accounted for mid teens of your contracted awards?

Ari Bousbib — Chairman and Chief Executive Officer

Yeah. Services. Yes, yes.

Eric Coldwell — Robert W. Baird — Analyst

Yeah. Okay, great. Thanks guys.

Andrew Markwick — Senior Vice President, Investor Relations and Treasury

Okay, operator, I think we’re up to the top of the hour now. So I think we’ve run out of time for the call. Thank you everyone for taking the time to join us today and we look forward to speaking with you again on our third quarter 2020 earnings. Jen and I will be available to take any questions that you may have for the rest of the day.

Ari Bousbib — Chairman and Chief Executive Officer

And Mike and Ron.

Andrew Markwick — Senior Vice President, Investor Relations and Treasury

Yeah, Mike and Ron will join us as well.

Ari Bousbib — Chairman and Chief Executive Officer

Okay, thank you everyone.

Operator

[Operator Closing Remarks]