Metabasis Therapeutics Incorporated Q3 2008 Earnings Call Transcript

Metabasis Therapeutics Inc. (MBRX-OLD) Q3 2008 Earnings Call November 13, 2008 8:30 AM ET

Executive

Dan Milles - Senior Director of Finance

Dr. Paul Laikind - President and Chief Executive Officer

Dr. Mark Erion - EVP, Research and Development and Chief Scientific Officer

Trisha Millican - Principal Accounting Officer and Controller

Dr. Barry Gumbiner - Vice President of Clinical Development and Chief Medical Officer

Constance Bienfait - Vice President of Investor Relations

Analyst

Craig Gordon - Cowen and Company

Kevin Degeeter - Oppenheimer

Vernon Bernardino - Rodman & Renshaw

Joe Aguilera - BioRevolution Capital

Operator

Good day ladies and gentlemen and welcome to the third quarter 2008 Metabasis Therapeutics earnings conference call. My name is Eric and I will be your coordinator today. At this time all participants are in listen-only mode. We will facilitate the question-and-answer session at the end of the presentation. (Operator Instructions)

I would now like to turn your presentation over to your host Ms. Constance Bienfait, Vice President of Investor Relations and Corporate Communications; please proceed.

Constance Bienfait

Thank you Eric and good morning everyone. Thank you for joining us for a discussion of our third quarter 2008 results and recent events. In a moment Dan Milles, our Senior Director of Finance, will provide a review of our third quarter financials. After Dan, Dr. Paul Laikind, our President and CEO will go over the company events which took place since the end of the second quarter. We will then take your questions.

Dr. Mark Erion, Executive Vice President of Research and Development and Chief Scientific Officer, Trisha Millican, Principal Accounting Officer and Controller; and Dr. Barry Gumbiner our new Vice President of Clinical Development and Chief Medical Officer are also here to help answer your questions.

Before we begin, I’d like to remind everyone that this call may include forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors which may cause our actual results to be materially different from historical results or from any results expressed or implied by the forward-looking statements. Please refer to our SEC filings for a more detailed discussion of these risks.

This conference call is taking place on November 13, 2008 at 8:30 am Eastern Time. Please note that this information, including forward-looking statements is accurate only as of this date. You can access our quarterly earnings release on our website at www.mbasis.com. In addition, this conference call is being webcast through the company’s website and will be archived there for future reference.

I would also like you to just add a date on your calendars; Metabasis will be holding an Investors Relations meeting at the Grand Hyatt on Stockton Street in San Francisco on Tuesday, January 13 from 09:00 to 10.30. I will be sending out actual invitations soon. Dr. Alan Garber will present data from the Phase 2a Clinical Trial for MB07803 and Paul and Mark will provide updates on MBO7811 and our other clinical and preclinical projects, business development and general company overview; we hope you will all join us.

Now I’d like to turn the call over to Dan.

Dan Milles

Thank you Connie and good morning everyone. The following is a brief overview of our financial results for the third quarter of 2008. We reported revenue of $1.4 million for the third quarter of 2008, compared with $2.7 million for the third quarter of 2007.

The $1.3 million decrease was mainly due to the fact that no license fee and sponsored research revenue from the Idenix collaboration was recognized in the 2008 period, as compared to 2007, the last year for which revenue under this collaboration was recognized. This decrease was somewhat offset by license fees recognized in connection with the Roche agreement established in August 2008.

Turning to expenses, research and development expenses were $8.5 million for the third quarter of 2008 compared with $10.9 million for the third quarter of 2007. The $2.4 million decrease was mainly due to a reduction in development expenses associated with our clinical stage programs MB07803, MB07811 and MB07133.

General and administrative expenses were $2.7 million for the third quarter of 2008 compared with $2.8 million for the third quarter of 2007. The small decrease was primarily due to a decrease in non-cash depreciation and stock based compensation.

Stock based compensation expense included in research and development and general and administrative expenses for the third quarter of 2008 were $592,000 and $345,000 respectively. We had net interest expense in the third quarter of 2008 of $97,000 compared to net interest income of $567,000 in the third quarter of 2007. The $664,000 decrease was primarily due to lower cash balances as compared to the prior year period.

Net loss for the third quarter of 2008 was $9.8 million or $0.28 per share compared to a net loss of $10.5 million or $0.34 per share for the third quarter of 2007. As of September 30, 2008 we had $32.8 million in cash and cash equivalents in securities available for sale as compared to $42.4 million as of December 31, 2007.

The $9.6 million decrease was primarily due to the use of cash to fund ongoing operations offset by proceeds from a warrant exchange and concurrent private placement, our venture debt and the $10 million payment from Roche received in the third quarter.

I would now like to turn the call over to Paul.

Paul Laikind

Okay, thank you Dan. As everyone is painfully aware, we are operating in one of the most challenging financial environment any of us has ever experienced. This has had in specific the hardest impact on the small micro cap biotech companies and we have certainly not been immune. Yet despite the conditions we have continued to achieve goals and make progress on our key program. Moreover the strategy we’ve been following has provided us with the co-pipeline of preclinical and clinical assets which we believe will help us operate successfully through these difficult time.

Even so, we announced today a restructuring of operations to preserve cash by reducing ongoing operating expenses. I will review this restructuring after I first provide you with an update on the progress we have made this quarter in clinical development, discovery and business development. I’ll start by updating you on our clinical programs.

On November 1, Dr. Alan Garber, the past President of American Diabetes Association, the respective Professor of Baylor College of Medicine presented a summary of results of the Phase 2a Clinical Trial for MB07803 at the World Congress on Controversies to Consensus in Diabetes, Obesity and Hypertension held in Barcelona. As a reminder, MB07803 is our FBPase inhibitor product candidate in development for the treatment of type 2 diabetes.

As we previously reported in the second quarter the primary efficacy endpoint of the clinical trial was achieved with administration of MB07803 once daily. As further reported in the presentation to World Congress, administration of MB07803, 200 milligrams resulted in a statistically and clinically significant placebo-adjusted reduction in fasting plasma glucose of 28.9 milligrams/deciliter from baseline at day 28 with the P value of 0.0177.

In the subgroup analysis of patients with fasting plasma glucose over 180 milligrams/deciliter in the 200 milligram dosing arm, the placebo-adjusted reduction in fasting plasma glucose from baseline was 49.7 milligrams/deciliter with the P value of 0.0099 at day 28. We believe that the fasting plasma glucose storing observed was quite impressive especially in patients with more established disease.

The clinical trial also showed MB07803 was safe and well tolerated with no lactic acidosis hyperlipidemia or significant GI adverse events. The overall adverse event profile was similar to that of placebo. These results support the continued development in MB07803 as a potential new approach for treating patients with diabetes, especially those patients that are contra-indicated for or in tolerant of the current first line therapy Metformin.

The glucose lowering, we saw in the Phase 2 proof-of-concept trial was good and inline with other current therapies, but we believe that there is a potential to do even better at higher doses. In order to test that belief, we recently initiated a clinical trial to study the pharmacokinetics and safety of higher doses of MB07803 in at least 40 patients. We expect to complete this study early next year and the results will help us to select the optimum dose that will be evaluated in future clinical trials, such as Phase 2b which we plan to do in collaboration with a strategic partner.

We also expect to conduct one or more additional studies next year to help us map out a regulatory path forward for the program and we believe this will help us to secure a partner to advance the project into the Phase 2b study and beyond.

I’ll turn it now to MB07811, our novel, orally administered, beta-subtype-selective thyroid hormone receptor agonists, for the treatment of hyperlacticemia that is designed to highness the well documented potential benefit to the TR beta approach including reduction of LDL cholesterol, serum liver triglycerides and Lp(a), while avoiding or minimizing well know side effects of the TR beta agonists.

We have demonstrated and published on the utility of our approach in animal models and we are now seeing promising results from our clinical program. As already reported in June, we announced initial results for the 14 days Phase 1b multiple-dose clinical trial and subjects with mild hypercholesterolemia, which showed that MB07811 was safe and well tolerated across the seven doses tested, ranging from 0.25 milligrams up to 40 milligrams.

The clinical trial results also showed dose-related reductions in fasting LDL and fasting triglyceride levels at day 14. Significant placebo-adjusted LDL reductions from baseline were observed at doses of 5 milligrams and above and ranged from approximately 15% to 41%, while placebo-adjusted triglyceride levels were reduced by more than 30% at doses of 2.5 milligrams and above.

In addition to the LDL and triglyceride decreases, we now have additional data to report, that demonstrates statistically significant reductions in ApoB and lipoprotein (a), Lp(a); two other measures of atherosclerotic risk. The reductions in ApoB and Lp(a) were dose-related in the range of 9% to 40% and 28% to 56% respectively at doses of 2.5 milligrams and above.

The results thus far suggest that MB07811 may have a unique ability to decrease the number of important risk factors with cardiovascular disease beyond with just LDL. Although, not yet studied in humans, the potential of MB07811 to reduce liver fat that we have demonstrated in animal models may represent yet another important feature of the product. Of note the statins only have a modest effect on triglycerides and no effects Lp(a) or liver fat; that’s if MB07811 is ultimately approved with these characteristics, it could provide physicians with an important new approach for controlling patients risk for heart disease.

We are now gearing up to initiate the 12 week Phase 2a proof-of-concept clinical trial for MB07811 and expect to enroll the first patients early next year. If all goes according to plan, we expect to report top-line results from this important study in the fourth quarter of next year.

Turning to our core preclinical programs, our discovery group continues to seek additional new and innovative treatments to help patients suffering with metabolic disorders. We’ve made excellent progress towards the development of an orally active Glucagon antagonist for the treatment of diabetes.

Glucagon is a hormone produced by the pancreas; it stimulates an increase in blood sugar that’s opposing the action of insulin. The Glucagon pathway is long been considered an important target for developing new treatments for diabetes and many companies are targeting metabolic disease and have a strong interest in this area. We believe that we are one of the leaders in the area and we have identified and tested novel potent orally active glucagon receptor antagonist.

We made the decision last year to establish a strategic collaboration for this program and we are in active discussions, although the success and timing of business development activity is always difficult to predict. We believe we are making good progress for us to goal of putting a partnership in place for this program.

Another important project for us is using the information we are learning from MB07811 to design second generation TR beta agonist as candidates for the treatment of hyperlipidemia. This project is going well with the recommendation for development possible this coming year. This has potential to enhance the value of our T3 program both for patients and for potential partners when the time comes to join forces to maximize the value of this exciting opportunity.

As we’ve noted before, earlier this year we extended the sponsors and research collaboration we had with Merck to discover new treatments for metabolic disease that target AMP activated Protein Kinase. Based on our progress to-date we have the potential to achieve the key milestone in that project with the selection of one or more compounds for third development. That milestone if achieved will result in payment to us from Merck.

We are already making good progress in our recently announced HCV partnership with Roche and believe we could hit revenue generating milestones in that project next year as well. In addition due to the continued work of our talented discovery group, we have potential to recommend one or two new novel therapies for metabolic disease over the next 12 months to 18 months.

Turning now to our business development activity, we continue to make significant progress in this area. As already noted, continued success on the business development front is an important pillar of our strategic plan. Success in this area will allow us to rapidly advance our products through funding from partners and both to our balance sheet. As announced in August we are very pleased to sign the aforementioned agreement with Roche to help them discover a new treatment for HCV by applying our HepDirect liver targeting technology to certain Roche compounds.

In addition to providing welcome capital, it also represented a strong endorsement of our liver-targeting expertise and technology. This partnership with Roche enables Metabasis and Roche to combine the respective strength in liver targeting and Hepatitis C research wish to hope that this combination will lead to a drug candidate for HCV in the very near future. As already noted we believe we are already closing in on a development candidate.

I have already mentioned the progress we are making towards establishing a partnership for our glucagon project; however that is not the only business development initiative we are pursuing. Given these trying times, we’ve stepped up efforts in other areas and are in active discussion with the companies regarding establishing strategic collaborations with certain other assets, so clinical and preclinical. We expect sales efforts to continue and even intensify over the next year.

Now, I’m going to move on to our restructuring of operations that we announced last night, resulting in across the board reduction of 35 Metabasis employees, approximately 30% of our workforce. It also includes closing of our facility in Ann Arbor, Michigan, which we had setup or we were doing development.

While extremely painful given the quality of Metabasis team, internal events coupled with the current environment left us little choice. The goal of restructuring was to streamline our operations to preserve cash by reducing ongoing operating expenses, like preserving our capabilities to drive value in our key programs.

While the cuts were across the board they fell more heavily on our development team. We have move more towards a virtual development organization, meaning that going forward we will rely more on outsourcing tests with third-party providers to allow great flexibility in control and cost.

I want to emphasis that despite this reduction in force, our main strategic goals remain unchanged, including the further clinical valuation of our core assets MB07811 and MB07803. We believe that time lines for the key clinical milestones, we previously outlined for these programs will be unaffected.

In addition although reduced in size, we have retained the core of our unique discovery team, a group of discovery recommended byproducts for clinical development and employees to recommend as many as five more in the coming month.

The work of our research team is paid dividend beyond new product candidates resulting in partnership that have helped fund much of the work over the years. Along these lines, we will continue to actively pursue business development initiative as that means of accelerating and funding operating activities and actually certain partnering opportunities might now be pursued earlier than originally planned under the previous strategic plan.

Our goal is to combine the cost saving from the restructuring current cash and proceeds from potential milestones from our current partnership with one or more additional partnerships to support operations to next years into the following year without reliance on the equity markets. Any additional business development success on the many opportunities we are pursuing, will extend that time even further.

Of course if we pay other receive any of the expected milestone payments that are on successful with our current business development activities, we’ll be forced to consider other alternatives early next year. We are very saddened by the necessity of the restructuring and want to extend our deepest gratitude to the dedicated and hard working employees that we must say goodbye to today.

With that overview, I’ll now turn the call back over to the operator and take your questions.

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from Craig Gordon - Cowen & Co.

Craig Gordon - Cowen & Co.

A couple of quick questions, if you don’t mind. In terms of I guess starting with 70811 lipid compounds; did you guys at all test CRP levels in these patients today? Did you screen them and see if they decreased at all?

Barry Gumbiner

This is Barry Gumbiner, Clinical Development. In our two week trial we cannot test CRP, we will do that in our upcoming proof-of-concept trial.

Craig Gordon - Cowen and Company

Okay and can you tell us a little bit more about the proof-of-concept trial in terms of the design, the dosing?

Barry Gumbiner

It’s a 12 week study, with four doses and placebo controlled trial, multi-center trial in patients with hypercholesterolemia.

Craig Gordon - Cowen and Company

And can you tell us what doses you are testing?

Barry Gumbiner

Yes, so in addition to placebo we’ll be testing 2, 5, 10 and 20 milligrams.

Craig Gordon - Cowen and Company

Okay, and are you guys planning on doing a combination statin trial in 2009?

Barry Gumbiner

Not in 2009.

Paul Laikind

When talking about a statin combination study, we have two that we’re seeing in terms of the plan. One will be our initial drug interaction study and that study could take place towards the end of 2009, but that will then be followed up with the Phase II study, where we’ll combine 70811 with statin and that plan is for 2010.

Dan Milles

That is the few statin combinations that will not come until after the proof-of-concept study there, in that regard.

Craig Gordon - Cowen and Company

And then turning to 70803; in the ongoing trial, how high are you going up in terms of the doses?

Paul Laikind

I think what I’ll just say is as you may know from the CODHy presentation, in that initial study we went up to 200 milligram CODHy using capsules. We actually mistook the study, we’re looking at a different formulation and I would just say the goal of that is to increase exposure of the drug with the idea of just making sure that those higher exposures will have the safety. With that we’ll then follow it up with the subsequent studies and ultimately we’ll look at the glucose lowering potential of these higher doses.

We believe that actually really because of the kind of steepness of the dose response of FBPase inhibitor we have historically observed and believed from how the mechanism works, that it’s a potential of not having to increase the exposure by very much and in order to get a additional glucose lowering effect, but that’s obviously something we’re going to have to determine in the future.

Craig Gordon - Cowen and Company

And then one other question on that; are you guys planning in 2009 on doing a combination trial with the net foreman?

Dan Milles

It’s obviously something that we’re thinking very carefully about. Right now we’re using the data that we’ve just gathered from the Phase II study. We’re speaking with both clinical and regulatory experts and trying to find the best path for this drug and this may include a discussion with FDA early next year and with that in mind, we’re hoping to use that information to have various, effective, production discussions with potential partners.

Along the way, if we think that type of study or another Phase 1 type study will help us in defining the path forward or help us in our discussions with partners, I think that we’d definitely do that study and that would include potentially the net foremen interaction study.

Craig Gordon - Cowen and Company

And then on the two compounds for pradefovir and Hepatitis C agent, where do those stand? Are those partly discussions ongoing or there’s two programs more on the background for the time being?

Dan Milles

Yes, we do have some partnering discussions going on. Both certainly with 70133, we haven’t really ramped up so much on pradefovir yet. We’ve been putting together some information on that and having some discussions with the agency and pradefovir to make sure that we understand that clear path forward for that program, but certainly with 70133, we do have discussions ongoing and plan to continue those and also plan to increase the focus on pradefovir.

However, having said that, I’d say, the priority right now is certainly on the glucagon project. We have some discussions on 70803 and expect to be ramping up those discussions as we go forward and better understand that program and there are some other areas we’re also interested in thinking about for partnering. So, there is a number of various on our plate right now and as I said, given the current environment we are operating, we are certainly taking a look at all those.

Operator

(Operator Instructions) Your next question comes from Kevin Degeeter - Oppenheimer

Kevin Degeeter - Oppenheimer

I guess a numbers of my clinical questions have already been answered, but if I may ask just a few more questions on this difficult restructuring. Paul, can you just give us a sense of are we really kind of cutting back scope of research? Doesn’t feel necessarily like that’s the case; it feels like as you laid it out in the call some of this is just giving yourself additional flexibility. So, help me understand here in a little bit more detail kind of from a research capacity standpoint, what priorities have been either diminished on factory you’ll eliminate it here?

Paul Laikind

Yes, as I said Kevin the biggest change was more on the development team, kind of moving more towards that virtual model. With regards to the research team, we did reduce its size, but not a significant amount. Part of that team is funded by existing partnership; part of that team is building the value in T3 program with the second generation, that we think is going to be very important when we begin the discussion on partnering 70811 and others are working on projects that we believe could lead to partnerships and substantial funding in the near-term. Obviously one of those is the Glucagon project, but there’s a couple of other program there.

Our research team has paid for itself many times over with the partnerships we’ve done in the past and we expect that to continue. So, we really retained the core of that team. We did make some cutbacks in it, but the core of that team has been retained and we believe that will pay dividends with additional partnerships and programs moving into the clinic here in the near future.

Kevin Degeeter - Oppenheimer

And maybe just from a P&L perspective just help maybe understand, when we should look for some of these cost reduction to flow through? It sounds like fourth quarter we may have a bit of a trade off here with severance and restructuring kind of offsetting the near terms gain. I mean is it really sort of going to be first of quarter of next year, till we get a feel for kind of a base line run rate for the cost structure of the business here?

Paul Laikind

Basically with the 35 people that go with the severance and such associated with that, including a couple of the officers, we expect it will take a couple of quarters for that to kind of work through and for us to start seeing the savings about two quarters for now.

Kevin Degeeter - Oppenheimer

And maybe just quickly here, can you just give us a feel for what you’re seeing in the business development environment. Obviously you have some interesting programs, the glucagons being one you highlighted from a business development standpoint, but we also know given the macroeconomic landscape that there are lot of assets out there particularly from biotech companies that are available to well funded big biotech and pharma.

I mean have you found that the process continues to move along as you kind of understood historically given your background or are we looking at a longer cycle here to get some deals done?

Paul Laikind

Yes, historically I think it’s interesting that you’re right. There’s a lot of projects out there and at the same time, as we know over the last few years the appetite for big pharma has increased as they’ve looked at the holes in their pipelines down the road.

So, we are still seeing significant interest certainly in the projects we’ve talked about. We are getting ready to go out for instances and get more aggressive on 70803, so it will be interesting to see what we learn there, especially not only with the factors that you point out, but the other factors regarding metabolic disease.

That’s one of the reasons we are spending a lot of time right now on the regulatory path forward for MB07803. We think that better defining that will help us greatly in these partnering. So, I think the partners are out there, they are certainly hungry. They certainly recognize they’ve got a unique opportunity given the pressure the industries under, but there’s still, the finding of good products that are going to get them excited, is still difficult and so far we feel pretty good about the products we have to offer.

Kevin Degeeter - Oppenheimer

And maybe one last question if I will. Just help me better understand I mean a process here; specifically just given the company’s kind of valuation here and given the structure of likely deals for the large indications that you’re going after, that typically includes some significant upfront, how do we think about your partnering versus frankly just spot out sell the company here given the dynamics and given the really kind of deep set of price evaluations for early stage biotech. Kind of how we weigh that out and how do you give shareholders some comfort here as to what the right course forward is?

Paul Laikind

Yes, our focus is certainly on partnering. We and our board feel that the evaluation of the company is not being accurately reflected by what we see in the stock price, no big surprise there and so an acquisition at these levels is that less than appealing to us. There is always the risk of that. I will say more a pretty closely held stock and so when our Board meets a lot of our shares are also meeting.

So I don’t think there is a real appetite for M&A at this price point, but it’s always a risk that we pay as a public biotech company, but certainly our focus is on the partnering and the discussions we’re having with the company.

Operator

Your next question comes from Vernon Bernardino - Rodman & Renshaw.

Vernon Bernardino - Rodman & Renshaw

My question is regarding discussions with the regulators. What kind of studies do you think given the events and discussions so far at the agency and the panel of this past summer, are they headed to recommending?

Paul Laikind

So, obviously when we were talking about thinking 7803, our regulatory path forward, we were looking at some very unique features of our drug, our candidate in this class of drugs and how it will be the best to bring them forward and those are the types of discussions we’ve been having with regulatory consultants and may have ultimately with the FDA.

Your question is related to more of the broader question of within the area of diabetes and how the cardiac signals that you have in your development program, how that ultimately might effect the timing of approval? Is that right Vernon?

Vernon Bernardino - Rodman & Renshaw

Yes, and would you’ve initially pursue a small Phase 2b and then need to pursue as a much largest Phase 2b before the pivotal?

Barry Gumbiner

This is Barry. I don’t think the goal of the Phase 2b trial will change this fundamental study to establish doses for Phase 3. So, it performed really independent of the other questions you were asking

Vernon Bernardino - Rodman & Renshaw

So, you think the Phase 2b would not need to be a large studying? About what size do you think it would be?

Barry Gumbiner

Well we’d anticipate it would be fairly typical of studies like this, about probably 400 patients and three or four doses.

Paul Laikind

And probably around 12 weeks of duration.

Operator

Your final question comes from Joe Aguilera - BioRevolution Capital.

Joe Aguilera - BioRevolution Capital

This question is for you Paul on the glucagon. We anticipate filing 90 in early 2009 is that correct? Will we file that before a partner or not necessarily?

Paul Laikind

I don’t think we’ve given a specific date on the IND. What we’ve said is that we expect this year to recommend the compound for development. Generally, once the compound is recommended for development it’s about a year process to get the IND.

Joe Aguilera - BioRevolution Capital

And on the Merck milestones, what are we looking at? What’s the potential there in the next year dollar wise to potentially get from every needle of the milestones? Where is that?

Paul Laikind

Yes, I believe that is in our stock, what we’ve said before. First, the milestone is a selection for development and the dollar amount is a $4 million milestone.

Joe Aguilera - BioRevolution Capital

And the 30, without any partners Paul for the next year, with this cut, will the $32.8 million take us out for another year at least if not a little more?

Paul Laikind

No, what we’ve said is if you read in our release, we did say that if we didn’t hit any milestones, we didn’t hit any business development and it takes us out to mid next year, but with the milestones with modest business development then that’s what get us into the following year.

Joe Aguilera - BioRevolution Capital

And then the liability Paul, we have $12.2 million long-term liabilities. So, where is that from, can you explain that for me now?

Dan Miller

Yes, within the long-term liabilities there’s two things; there’s deferred revenue associated with the Roche deal that we just closed in the Q3 and then also the ventured loan that we did in Q1. Those are the two biggest components of what’s part of the long-term liability, so part of that is just differed revenue.

Joe Aguilera - BioRevolution Capital

And we have 35 million issues out, is that correct, not 33.7…

Dan Miller

Yes, just a little over 35 million.

Operator

We currently have no more questions in queue at this time. I would like to turn the call over Dr. Laikind for closing remark.

Paul Laikind

Okay, well I want to thank everyone for tuning in this morning to hear our results. Obviously this is a difficult week for the company, but I think we positioned ourselves with the pipeline we have for future success and we look forward to updating you next time and also seeing you in January at our investor day in San Francisco. Thank you.

Operator

Thank you for your participation in today’s conference. This concludes our presentation. You may now disconnect. Have a good day.

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