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Navidea Biopharmaceuticals (NAVB)

March 13, 2013 4:00 pm ET

Executives

Brent L. Larson - Chief Financial Officer, Principal Accounting Officer, Senior Vice President, Treasurer and Secretary

Mark Jerome Pykett - Chief Executive Officer, President and Director

Thomas H. Tulip - Chief Business Officer and Executive Vice President

Analysts

Stephen G. Brozak - WBB Securities, LLC, Research Division

Michael Goldberg

Michael G. King - JMP Securities LLC, Research Division

Reni J. Benjamin - Burrill & Company, Research Division

Stephen M. Dunn - LifeTech Capital, Research Division

Charles C. Duncan - Piper Jaffray Companies, Research Division

Operator

Greetings, and welcome to the Navidea Biopharmaceuticals Incorporated Lymphoseek Approval Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mr. Brent Larson. Thank you, Mr. Larson, you may begin.

Brent L. Larson

Thank you, Jen. Good afternoon, everyone. As Jen said, my name is Brent Larson, CFO of Navidea Biopharmaceuticals, and I will be moderating this afternoon's call.

Before we get started, we would like to remind you that during the course of the call, management may make projections or other forward-looking remarks regarding future events or the future financial performance of the company. It's important to note that such statements about Navidea’s estimated or anticipated future results or other nonhistorical facts are forward-looking statements and reflect Navidea’s current perspective on existing trends and information. Navidea disclaims any intent or obligation to update these forward-looking statements.

Actual results may differ materially from Navidea’s current expectations, depending on a number of factors affecting Navidea’s business. These factors include, among others, the inherent uncertainty associated with financial projections, timely and successful implementation of strategic initiatives, the difficulty of and predicting the timing or outcome of product development efforts, FDA or other regulatory agency approvals or actions, market acceptance of and continued demand for Navidea’s products, clinical and regulatory pathways, the impact of competitive products and pricing, patents or other intellectual property rights held by competitors, the availability and pricing of third-party sourced products and materials, successful compliance with government regulations, and such other risks and uncertainties detailed in Navidea’s periodic public filings on file with the Securities and Exchange Commission.

Now I'd like to turn the call over to Dr. Mark Pykett, President and Chief Executive Officer of Navidea. Mark?

Mark Jerome Pykett

Thank you, Brent. This is a very exciting day for Navidea with the FDA approval of Lymphoseek, our first approved precision diagnostic and a breakthrough new product for pinpointing lymph nodes in patients with breast cancer and melanoma. We believe that Lymphoseek's approval validates our vision of a novel precision diagnostic to the market and is an example of things to come for the rest of the pipeline. We expect to make a formal launch of Lymphoseek in the next quarter and therefore generate revenue in Q2.

We believe with its approval, strong label, safety and efficacy profile and near-term commercial introduction with our partner, Cardinal Health, that Lymphoseek is well positioned to provide an important new tool for identifying lymph nodes that are most likely to harbor cancer. These are the lymph nodes that are most helpful in determining if disease has spread beyond the primary tumor site. This type of lymph node surgery or lymphatic mapping has also been shown to reduce unnecessary lymph node removal and better avoid permanent side effects of extensive lymph node dissection, such as or long-term or permanent swelling, bleeding and pain. We believe Lymphoseek is the first innovative product in the field of lymphatic mapping in over 30 years and that physicians and patients have been waiting for improvement in this area.

Lymphoseek is a purpose-built agent specifically designed to target lymph nodes to see if cancer has spread. It targets a specific receptor found on immune cells that reside in high concentrations within lymph nodes. In this regard, it is like a homing device for finding the lymph nodes that are most likely to harbor cancer if it has spread. This homing mechanism gives Lymphoseek an exceptional targeting rate and provides important actionable information to physicians.

We are very pleased with the strong label Lymphoseek has received and believe it will afford clear positioning in the market. The Lymphoseek label provides for its "use as a radioactive diagnostic agent indicated for lymphatic mapping with a handheld gamma counter to assist in the localization of lymph nodes draining a primary tumor site in patients with breast cancer or melanoma." We are likewise very pleased with the safety profile highlighted in the package insert. I would also note that there were no post-marketing requirements from FDA with this approval.

As we have noted previously, even though breast cancer and melanoma are the 2 cancers in which the vast majority of lymphatic mapping is currently performed in the United States, and we are pleased that the label includes both cancer types, there are about 300,000 new cases of breast cancer and melanoma in the U.S. each year and more than 1 million worldwide. By studying the use of Lymphoseek in other cancers, as in our Phase III clinical trial in head and neck cancer, for which we are presently completing an interim analysis, and in a physician-initiated study in colorectal cancer, we believe that it may ultimately be useful in a range of other solid tumor cancers.

Overall, we are very pleased with the Lymphoseek approval from FDA and with its label and how we are positioned for commercialization. With today's approval, I would also like to note that an additional $20 million is available under our credit line with Platinum-Montaur, providing clear access to capital, along with Lymphoseek cash flows to continue to build our company and seek new opportunity.

With this, I would like to turn the call over to Tom to discuss the market outlook and our product launch plans.

Thomas H. Tulip

Thank you, Mark. And thank you all for joining us this afternoon. I couldn't agree more with Mark that this watershed approval for Lymphoseek is a strong validation of our mission and vision here at Navidea, only the first striking example of our ability to deliver important precision diagnostics to the medical community and most importantly, to the patients it and we serve. We can now plan to build on this focus on excellence in development as we strive to exemplify excellence in commercialization.

As we've communicated, we're delighted to be working closely with Cardinal Health to effectively launch Lymphoseek. Cardinal Health Nuclear Pharmacy Services division is by far the market leader in the provision of radiopharmaceutical doses to hospitals and clinics in the U.S., with a strong majority market share and essentially total coverage of [indiscernible] customers throughout the country. Cardinal Health is well positioned in this radiopharmaceutical space by making daily contact with customers in the target market, all of nuclear medicine, augmented by the largest sales force in the field, an extremely strong pharmacist organization, all of which will lead to robust support, leading to Lymphoseek's success. With Lymphoseek approved and this strong label in hand, we're immediately launching marketing activities, including direct interaction of our medical education teams with target physician groups. Medical education is a key activity in which Navidea will be directly involved, both now and in the future, and it's a critical activity to doing it right, to driving optimal adoption by generating awareness and interest for lymphatic mapping. In the second quarter, in particular, we are planning an important symposium at the Oncology Meeting to be held in late May, and we'll have a very significant presence at the Nuclear Medicine Meeting, the Society of Nuclear Medicine and Molecular Imaging, which will take place in June. Building on this work as the year advances, we'll expand our market conditioning as well as continue to build inventory.

As Mark said, we expect to make a formal launch next quarter and begin to generate revenue in Q2.

Prelaunch activities have been under way in conjunction with Cardinal, including but not limited to, sales and pharmacist training, customer profile and targeted -- profiling and targeting, development of a robust reimbursement strategy and materials as well as a formulary kit. With final approval and the label in hand, we can move forward with promotional materials and we will now complete the live training for Cardinal's team on a nationwide basis. Based on the favorable label for Lymphoseek, Cardinal Health has told us that they will price Lymphoseek at $300 per patient.

Within a few months, following commercial launch, we will expect Lymphoseek to have its own pass-through code, unique pass-through provisional code that will enable Lymphoseek to be reimbursed separately from the lymphatic mapping CPT code, as practiced by CMS. We've already initiated the process to seek a formal permanent A code for a long-term reimbursement through the HCPCS process. Separate payment of this sort is enabled by CMS for up to 3 calendar years.

In addition to continued reimbursement and utilization resources, we have resources in place for customers to download reimbursement information and to facilitate getting Lymphoseek on formulary as necessary. We've established the product website, www.lymphoseek.com, and we encourage you to visit the site often.

So this is good news for the medical community, and as I said, more importantly for patients. For our shareholders out there, more good news. We expect to realize very attractive economics from the sale of -- the revenues from Lymphoseek. Slightly more than half of Cardinal's end-user Lymphoseek revenue will flow through to Navidea. And we'll record pharma level gross margins from this revenue, expected to be in excess of 75%, even at launch. This translates into an estimated 35% to 40% of end-user customer revenue dropping through to our EBITDA, which is a very attractive pretax cash flow. We believe this will be very attractive as a valuation multiplier for the company going forward. And because of our business model and other portfolio assets, we believe this is an important premise that applies to our other products in development as well.

With that, I'll turn the call back over to Mark.

Mark Jerome Pykett

Thanks, Tom. At this point, we'd like to open the call to questions.

Question-and-Answer Session

Operator

[Operator Instructions] Our first question comes from the line of Steve Brozak with WBB Securities.

Stephen G. Brozak - WBB Securities, LLC, Research Division

Congratulations, gentlemen. We initiated coverage of you 7 years ago, and I'm delighted to know that you've made it. And I'm also delighted to know that this is probably the most listened-to call in your history. So I'll just ask one simple question. Why is Cardinal Health going to go out there and sell your product versus what they are selling today? And jump back into the queue.

Thomas H. Tulip

I think there are a number of reasons why Cardinal will be so motivated and so effective in selling Lymphoseek. First and foremost, it really is quite an important product that's going to change people's lives. But from a business point of view, again, I think Cardinal's motivated at a number of different levels. They're strategically motivated because this will be one of the first new products that they have available, that they will be introducing on an exclusive basis. And we know that they want to demonstrate to the innovator community that they can take such a new product and really make it a success. From an operational point of view, we know that there are economic advantages, cost of materials and -- advantages to Cardinal for the use of Lymphoseek. Additionally, it will also reduce radioactive exposure to their workforce. So a number of operational incentives, if you will. And finally, the salespeople are incredibly excited of having something new to sell, something new to promote, that enables them to bring something new and different to their customers. So again, at a number of different levels, it's clear to us that Cardinal is very motivated. And that's been evident in our strong, active engagement with them over the course of the last year.

Operator

Our next question comes from the line of Michael Goldberg with Montaur Capital.

Michael Goldberg

Again, I just want to reiterate how excited we are and congratulate you on this great achievement. What I really want to focus in terms of my question today is not on Lymphoseek, as we just believe Lymphoseek has been a success and we're very confident that it will be a success. And I think in the hands of Cardinal, just as Tom indicated, it will be a very important addition to patients and an important contributor to the bottom line. But I really want to focus on the pipeline, now that you've been freed up to focus on things beyond the Lymphoseek product. And I was taken by the recent news that came out in Alzheimer's and I wanted to ask you a question. In light of looking at the next-generation products in your pipeline, you've built this great infrastructure. You've got in this radiopharmaceutical approved that's going to change the whole lymphatic mapping area. What is your take in terms of how your product will be positioned versus the market -- the initial product on the market today, the Lilly product, in this multi-billion-dollar Alzheimer's market, now with this new data that came out that said that you can actually start to pick up amyloid deposits 20 -- even 25 years before you have symptoms?

Mark Jerome Pykett

Michael, that's a great question. And we believe ...

Michael Goldberg

And Mark, let me just reiterate one more thing before you go on. As you've indicated in your prepared remarks, statement, this approval opens up another $20 million, not that I think you're going to need it because you'll be generating plenty of capital. But from our perspective, if there's a way to speed things up, we'd love to hear how you could do it because we think that's really the next big chapter for this company. I'm sorry, Mark.

Mark Jerome Pykett

Absolutely, absolutely. We have continued to make great progress throughout our pipeline and certainly appreciate the support that Platinum-Montaur has provided. It has allowed us and will continue to allow us to move this company forward with good financial resources and be able to, as you said, accelerate programs and continue to move each of these programs forward. With respect to the 4694 PET amyloid program that you mentioned, we've been talking about this for a while, but I'm not sure that the value of that program or for that matter of the other elements of our pipeline have really begun to sink in with people. This is a best-in-class agent that we believe has true diagnostic value as a second-generation diagnostic that stands alone from the first-generation diagnostics that have been developed to date, such as those from Lilly or GE Healthcare or even the [indiscernible]. And the reason for that is this agent intrinsically is able to detect beta amyloid while it has very low background binding to white matter. And that produces very strong signal-to-noise ratios that allow the detection of lower amyloid levels. That's what sets it apart from the other agents that have been developed to date, which really can't detect low levels of beta amyloid among background white matter. And the signal-to-noise ratios, being as high as they are, allow for clear images to be generated by 4694, which may then enable earlier diagnosis of the disease. The reason that's so very important, is it is now recognized that the earlier you can diagnose the disorder, that being Alzheimer's disease, but also earlier in the course of its disease progression, in the form emerging called mild cognitive impairment, where you have the best opportunity to intervene and have a therapeutic effect. So as this field evolves, we really believe that 4694 is ideally positioned to be that next-generation agent that allows for the earlier detection of really the underlying cause of cognitive impairment, therefore allows appropriate treatments and therapeutic choices to be made. And I want to remind you, I'm not only talking about Alzheimer's disease here. We are talking about the other dementias and forms of cognitive interment which are confused with Alzheimer's disease. And so in that regard, this agent is really, we believe, the leader of the pack and is positioned well for what lies ahead in the dementia and cognitive impairment space.

Operator

Our next question comes from the line of Mike King with JMP Securities.

Michael G. King - JMP Securities LLC, Research Division

Let me add my congratulations to you guys as well after a hard-fought battle here. It's appropriate that I'm following Michael Goldberg because I'd like to know, can we just -- can you remind us of the terms of the Montaur line and just as far as what it may or may not mean in terms of issuance of Navidea shares?

Mark Jerome Pykett

Yes, Mike. I'll let Brent review the details. But clearly, what it means is we have avenues to resources and the capital that allow us to continue to move this company forward. We've used the line of credit so far successfully but judiciously and prudently. And we believe that, that will allow the company to stay the course so that we can see our way forward to Lymphoseek revenue, which we think will provide meaningful cash flow back to the company, and we think at a very reasonable and attractive cost of capital using the available credit from Montaur. Brent, would you provide some details?

Brent L. Larson

Sure, Mark. Mike, I think you may know some of these already. But certainly, the first $15 million was available immediately, which I think we recently announced we've drawn on only $4 million of it at this point in time. So as Mark said, judiciously using. The approval itself triggers the availability, as both Michael and Mark have pointed out, of an additional $20 million. There is a third piece, which is a tertiary $15 million, which we have not at this point in time set firm terms on what would trigger that. But certainly, the intent of that was to make it available to keep the pipeline robust and keep moving along. So as we continue to identify pipeline opportunities, we have an avenue to fund that should we see fit. The overall terms of the debt are a 10% straight interest coupon. There are no, as I would term them, bells and whistles in the form of additional fees or commitments or anything like that. So it's a pretty straightforward piece of paper. And we're very pleased to be having a partner like Montaur to work with in funding the needs as we see fit.

Operator

Our next question comes from the line of Reni Benjamin with Burrill & Company

Reni J. Benjamin - Burrill & Company, Research Division

Let me add my congratulations as well for this approval. A couple of questions, maybe just starting off with the label. And it's kind of broad-based, but is this the best label you could've gotten? At any point during the negotiations, were you looking for interlymphatic mapping across a whole slew of indications? Or has the game plan always been to get it into breast and melanoma and then with the subsequent data points that are coming, like the head and neck, continue to expand the market potential of Lymphoseek?

Mark Jerome Pykett

I think it's widely known that we went into the FDA asking for a general lymphatic mapping label, where we could potentially use Lymphoseek in other kinds of cancers. It's been very clear that in the discussions with the FDA, they were going to rely on the study schemes that were successfully completed in patients with breast cancer and melanoma. In the course of our dialogue with them, of course, that ended up being just fine with us because that's where the market is today. That's where the vast majority of procedures are done, in breast cancer and melanoma in the United States today. It's where the other agents have been used for quite some time. And so we're very pleased to have both of those agents in this initial label but we're clearly not done. As you know, we're conducting an interim analysis on our Phase III head and neck cancer study. Now we've begun a physician-initiated study in colorectal cancer. We expect very much to move down the line to these other cancers because the value of lymphatic mapping in those other cancers is very clear. You need to be able to determine whether cancer has moved from the primary site into a lymphatic system to properly stage a patient. And yet the other agents developed to date and used for many years have not been successful in assisting with lymphatic mapping in those other cancers because their performance characteristics really don't support its use in those types of cancer, especially in an intraoperative setting. So we think Lymphoseek, because of its receptor-targeted property and its ability to pinpoint the key lymph nodes and home to the ones that are predictive of whether cancer has spread or not, really allows this agent to be used for the first time in a whole suite of cancers. And we very much intend on addressing those cancers. We'll do that not only in the U.S. but also outside the U.S. In fact, we have provided data to the European regulators to likewise seek a broad lymphatic mapping label in Europe, where the use of lymphatic mapping agents is not only in breast cancer and melanoma but other cancers as well, such as prostate cancer.

Reni J. Benjamin - Burrill & Company, Research Division

Got it. Okay. Another question. Can you take us through the steps of once a patient is scheduled for the procedure, the steps involved from how the order is placed, how many days, the procedures involved to when you guys actually book revenues? And then I have a follow-up.

Mark Jerome Pykett

Ren, I think we'll spread the wealth on that one. We'll let Tom talk about the procedures and Brent talk about the revenue.

Thomas H. Tulip

Sure. So let's use the case of a breast cancer patient as an example. A woman is diagnosed and scheduled for surgery. As we've spoken before, that's a large percentage of those women presenting with breast cancers. That surgical procedure is scheduled. The surgeon then communicates to his or her nuclear medicine colleagues for the need -- in this case, for a Lymphoseek study on generally the day before, possibly 2 days before the scheduled surgical procedure. The nuclear medicine department will then communicate with Cardinal. And there are very facile mechanisms in place to do this, to order the appropriate dosage, patient-specific dose. Cardinal then, generally the morning of the procedure -- early in the morning of the procedure, will compound a dose according to the script that they have received and deliver that dose in a time-sensitive fashion. Nuclear medicine would receive this dose, administer it to the woman. In the case of Lymphoseek, that administration can come actually quite soon before the scheduled surgery because of the reliable, consistent, efficient fashion in which Lymphoseek clears the injection site and deposits in those first primary key draining nodes. So that whole process can be accomplished in 15 minutes to 0.5 hour from injection to a provision surgery. It's a bit different than the current practice, which isn't anywhere near as consistent or reliable as I've just described. So that's the patient flow component. Brent, you want to speak about the supply chain and our remuneration?

Brent L. Larson

Sure.

Reni J. Benjamin - Burrill & Company, Research Division

Sorry. Just Brent, before maybe you jump in. Just Tom, so there is really no change, there is no additional hurdles in terms of the physicians or the nuclear medicine doctors and the contact with Cardinal? This is -- it would -- if they're ordering your competitor or ordering Lymphoseek, it would be the same exact steps? There's nothing else new?

Thomas H. Tulip

Except as I said, from an ordering point of view, they won't be any different. From a practice within nuclear medicine, it will be more efficient. But beyond that, the practice does not change demonstrably.

Brent L. Larson

As far as the revenue cycle, I think it's pretty straightforward. We get a [indiscernible] price on each vial of Lymphoseek as it's transferred from Cardinal's central warehouse to the nuclear pharmacy. So we've essentially consigned the inventory at the central warehouse. But once it goes to the pharmacies, then that generates a payment to us. More importantly, though, I think as we've talked about in the past as well, the arrangement with Cardinal is designed to be a revenue-sharing one, whereby each procedure that -- whereby a patient that is injected generates a revenue to Navidea. And Tom and Mark both talked to in the approximated 50% range of what they end up billing is going to be transferred to us. And we're going to do that reconciliation on a monthly basis. So that's really where the bulk of the revenue is going to come from, from a process standpoint. It's from the actual procedural occurrences as they happen.

Reni J. Benjamin - Burrill & Company, Research Division

Okay. And just one final question.

Thomas H. Tulip

Before you do that, let me jump back in and add one comment, one additional piece of color to what I said before. I think I addressed your question in terms of how things don't change. There is one aspect that will, in fact, change, potentially. And that is because Lymphoseek, when it goes to those first primary draining nodes, is bound there, and bound for as long as 30 hours, it's actually possible to inject in the case of a breast cancer sufferer, the woman, on day 1 and take the individual to surgery on day 2. That's not practical today. So in large measure, the whole ordering praxis, the supply chain is unchanged. But there's that extra added opportunity that Lymphoseek provides to both nuclear medicine and surgery from a point of differentiation.

Reni J. Benjamin - Burrill & Company, Research Division

Just one last final question. You have the FDA approval. You mentioned on the previous call potential partnerships in Europe and that you're very close to partnership -- I don't think you talked about what the ideal deal could be for Navidea. Can you talk to us a little bit about -- maybe even give us some parameters of how a deal could be structured in Europe that you guys would like?

Thomas H. Tulip

Well, I think I will defer that. We are close -- I will tell you today's approval gives us that much more leverage with both the potential partners in Europe and in elsewhere. I think you're going to see a variety of different structures. And at this point, I think I'll wait till we are able to announce exactly what those might be, in hopefully, in the quite near future, certainly in the next couple of months.

Operator

Our next question comes from the line of Stephen Dunn with LifeTech Capital.

Stephen M. Dunn - LifeTech Capital, Research Division

Congratulations to the entire team for the rather circuitous route to approval. In the interest of time, all my questions have been answered. So I'll just jump off onto the queue.

Operator

The question comes from the line of Charles Duncan with Piper Jaffray.

Charles C. Duncan - Piper Jaffray Companies, Research Division

Congratulations on the approval. Mark, maybe this is for you, maybe not. I guess I'm wondering a little bit about the process for formulary acceptance and what percentage of institutions you believe that formulary approval might represent in terms of governing early use of Lymphoseek.

Mark Jerome Pykett

I'll turn that question over to Tom.

Thomas H. Tulip

Sure. I actually don't have a number for you. I can tell you what we've envisioned and what we'll be doing or do -- in this case, what Cardinal has envisioned, what Cardinal will be doing. Formulary doesn't hold the same level of sway for an imaging pharmaceutical, a radiopharmaceutical that it might with a traditional therapeutic that would be inventoried in hospital pharmacy that the P&T Committee governs most strongly, most generally. So there's a mix. Certainly sometimes formulary and P&T do have some influence on new products in the imaging side. But generally, as they're inventoried or acquired through the radiology nuclear medicine department, that's kind of de minimis. Having said that, we have built formulary kits for those institutions that might require P&T oversight. We don't envision it being a significant barrier. Certainly not the same sort of barrier that a traditional ethical pharmaceutical might encounter as they introduce into a hospital or clinic setting.

Charles C. Duncan - Piper Jaffray Companies, Research Division

Okay. If you could just remind us on the IP left for Lymphoseek and what it covers and what your vision is to expand that, if any?

Mark Jerome Pykett

Yes, the intellectual property estate for Lymphoseek is quite strong. The major past patents based on composition of matter have been issued in territories around the world. The earliest expirations I believe are 2022 and beyond. So there is quite an extensive life left to those patent estates. We do frequently look to ways to extend the intellectual property runway for that -- for the product, and we'll continue to do so. We think that could lead to elements of life cycle management. But at this point, we're just tending to sort of the customary parameters for keeping our intellectual property intact and strong.

Charles C. Duncan - Piper Jaffray Companies, Research Division

And then final question is regarding the head and neck cancer data that we anticipate later on this year. If positive, would you anticipate seeking a label expansion? Or would there be a publication-based strategy for disseminating that information and helping people understand how to use it?

Mark Jerome Pykett

That's a great question, Charles. That study was designed with very specific purposes in mind. And if you'll recall, it was designed as a comparison against a full pathology dissection, which is a true gold standard because you get to assess each of the lymph nodes assessed by pathology to see if cancer has moved from the primary site into lymphatics. In that regard, that study in and of itself stands alone relative to other studies which have been done for other agents. If successful, then, we believe that the basis of those data would provide an avenue to move forward to potentially augment the label for Lymphoseek, certainly, there will be publications stemming from the study, we believe. But if successful, we think there could be recourse to seeking an expanded label for Lymphoseek to possibly pursue a sentinel lymph node biopsy claim but also at the very least to extend into head and neck cancer and by virtue of that and then having 3 cancers possibly move to a broader label for general lymphatic mapping as well. So there are sort of 3 types of the opportunities there, in addition to the presentations, the publications and the validation coming from the study itself.

Charles C. Duncan - Piper Jaffray Companies, Research Division

Mark, congratulations. Clearly good execution. Nice approval before the PDUFA.

Operator

Our next question comes from the line of Brenda Sandburg with The Pink Sheet.

Brenda Sandburg

I wondered what the status of your application in Europe is and if that application is seeking broad lymphatic mapping.

Mark Jerome Pykett

As we disclosed toward the end of 2012, we filed the marketing authorization application in Europe. That application was accepted and validated. It's now under review with the European regulators. We expect periodic feedback from the EMA with the idea of -- much as the FDA process evolves, moving forward their evaluation of the data. And in the application itself, we are seeking a broader, general lymphatic mapping label, not only on the basis of the well completed Phase III studies in breast cancer and melanoma but also on supplementary data using meta-analysis, comparing Lymphoseek to sulfur colloid, which is -- sorry, to colloidal materials, which are used over in Europe as well. We think that, that is of interest to European regulators. And as we move through the review, we will provide some feedback updates as to how the review is proceeding.

Operator

Our next question comes from the line of Brian Branch [ph], private investor.

Unknown Attendee

Congratulations, guys. Just a couple of questions here. As the lady before me just brought up, what is the review cycle, the timeframe for the application? And the next question was, can you shed any light on what was the exact issue of CRL with the third-party manufacturer?

Mark Jerome Pykett

Sure, Brian. The review cycle for the EMA tends to be similar to that for the FDA in terms of its length. It tends to be between 10 and 12 months of full review. That said, the European regulators provide specific dates for feedback at various times, at which point, depending upon the scope of the responses required from the sponsor, they can "stop the clock," meaning they'll stop their review while information is prepared and supplied back to them. So it's difficult to predict the exact timing. Sort of the inside window would be between 10 and 12 months after filing an acceptance of the MAA by the EMA. With respect to the issue about the CRL, we have sort of moved beyond that. As we said, going back to the time the CRL came out, that we felt confident we could reply and respond to the agency. We've done that. We did that within 7 weeks. That was very successful. We had a quick turnaround for us. And we're very happy with our position with our manufacturers at this point. So I think we'll move on from that.

Operator

Our next question comes from the line of Raymond Goldstein [ph], private investor.

Unknown Attendee

Gentlemen, congratulations. Two quick questions. One is, do the existing gamma detectors need to be updated in any way in order to detect the Lymphoseek agent? Firstly. And secondly, is there plans or discussion for any kind of secondary offering by the company?

Thomas H. Tulip

So I can do the first one. The handheld gamma detector and gamma cameras, which are used to provide larger images frequently before surgery, will not need to be amended in any fashion whatsoever.

Mark Jerome Pykett

And with respect to your second question, as we said in our briefing remarks, because of the line of credit that we have in place with Platinum-Montaur, which has now been extended by an additional $20 million, as well as what we believe will be near-term meaningful cash flows from Lymphoseek, we do not have any plans to do a secondary financing at this time.

Brent L. Larson

Mark, the only thing I would add to that -- to Tom's comment, actually, is that now with the advent of Lymphoseek approval here, we've always seen Lymphoseek as potentially influencing additional device placements. So the device business that we sold to Devicor in 2011 could prove to be more fruitful now with this potential impetus to increase utilization.

Operator

Our next question comes from the line of Bruce Duncan [ph], private investor.

Unknown Attendee

Congratulations to all. As a private investor, I have a question about the FDA approval today not causing an uptick in your share price today. You traded well over 10 million shares today. And I'm scanning the intraday chart now. And right from approval going forward, the stock just platformed for the entire day. It took a dip and then closed on the upswing. Do you have any speculation as to why an FDA approval would not cause an uptick on the price?

Mark Jerome Pykett

Bruce, we don't speculate on the market. Market dynamics are what they are. This is a great day for Navidea. It's a great day for Lymphoseek. It's certainly a great day for physicians and patients who will undergo lymphatic mapping procedures. And we continue to make great progress in each of our programs, not only with Lymphoseek but with the other pipeline programs as well that we think will certainly reflect in value over time. And so we're very focused on continuing to manage the business, managing the company and really using this as a springboard to reflect on what lies ahead for the company. We think we've got tremendous value in our pipeline programs. And we're very encouraged by this as being the first example of Navidea's capabilities to bring a precision diagnostic through approval to the market, and there will be more to follow, we believe.

Unknown Attendee

I, too, am encouraged about going forward, but today just completely flummoxed me. I have been a day trader and a swing trader in the health care sector for a minimum of -- from 5 years now. And it's just that I see even minor ticks in stocks that have gone through Phase II and Phase III, news announcements, FDA approval should just -- I just thought it would just blow you guys right out of the water today. So I hope, going forward, something happens here.

Operator

Our next question comes from the line of Rudy Dominguez [ph], private investor.

Unknown Attendee

My question is how well are you guys locked in with the academic facilities across the country to increase adoption rate of Lymphoseek through the community-based hospitals?

Thomas H. Tulip

Well, I think we are very well positioned with Cardinal. Cardinal, again, has the largest market share and the largest reach of any of the sales marketing distribution entities in the radiopharmaceutical space. They call on and call all of these community and larger hospitals on a very frequent basis. Frequently, even at the community level, there is I would say between 5, 6, 7 phone calls a day between the Cardinal pharmacies and those customers. And so I think with Cardinal poised to work with us to roll out Lymphoseek that we're very well positioned, even with the smaller community hospitals.

Operator

Ladies and gentlemen, I would now like to turn the floor back over to management for any closing comments.

Mark Jerome Pykett

Thank you very much. Thank you for your time on today's call to discuss this watershed milestone for Navidea. We owe a great deal of gratitude to all those who have helped make this approval a reality. It is an important step forward, and our team is truly energized by the success realized with the approval of Lymphoseek. As we've stated already, we firmly believe that this approval validates our ability to bring precision diagnostics to the market and further establishes Navidea as a leader in this critical emerging area of health care. We look forward to ongoing advances with Lymphoseek and to important progress with our other precision diagnostics in NAV4694, NAV5001 and RIGScan. Thank you very much.

Operator

Thank you. Ladies and gentlemen, this concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

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