Echo Therapeutics' CEO Discusses Q4 2013 Results - Earnings Call Transcript

Mar.27.14 | About: Echo Therapeutics (ECTE)

Echo Therapeutics (NASDAQ:ECTE)

Q4 2013 Earnings Conference Call

March 27, 2014 9:00 am ET

Executives

Robert Doman – Executive Chairman, Chief Executive Officer (interim)

Christopher Schnittker – Chief Financial Officer

David Walton – Vice President, Marketing and Commercial Development

Christine Olimpio – Director, Investor Relations

Analysts

Bill Patrali (ph) – Amran (ph) Investments

Ben Haynor – Feltl & Co.

Dan Akivis – Maxim Group

Nathan Cali – Noble Financial

Stephen Dunn – LifeTech Capital

Operator

Greetings and welcome to the Echo Therapeutics 2013 Financial Results conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star, zero on your telephone keypad. As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, Christine Olimpio. Thank you. Ms. Olimpio. You may now begin.

Christine Olimpio

Good morning everyone. This is Christine Olimpio, Director of Corporate Communications and Investor Relations of Echo Therapeutics. Thank you all for joining us today for our 2013 financial results call. Leading today’s call is Robert Doman, our Executive Chairman and interim CEO, and joining us on the call is Christopher Schnittker, our CFO, and David Walton, our Vice President of Marketing & Commercial Development. Shortly after this call is concluded, a replay of this call will be available on the Events section of our website through April 10.

Before we get started, I’d like to remind everyone that our discussion today may include forward-looking statements as defined under the securities laws. The statements in this call that are not historical facts may constitute forward-looking statements that are based on current expectations and are subject to risks and uncertainties that could cause actual future results to differ materially from those expressed or implied by such statements. Those risks and uncertainties include but are not limited to risks related to general market conditions and other risks and uncertainties identified and described in more detail in Echo’s filings with the Securities and Exchange Commission, including without limitation its Annual Report on Form 10-K for the year ended December 31, 2012, its quarterly reports on Form 10-Q since that date, and its current reports on Form 8-K since that date. Echo undertakes no obligation to publicly update or revise any of these forward-looking statements.

I’d now like to turn the call over to our Executive Chairman and interim CEO, Bob Doman.

Robert Doman

Thank you, Christine. Good morning everyone and thank you for joining us on the call this morning. Since the last financial results call in November, we have made progress on a number of fronts, and on today’s call we will provide some detail on our fourth quarter clinical, regulatory and operational progress. Chris will follow with a review of our financial results for the year-ended December 31, 2013 and Dave will then provide an update on our most recent commercialization efforts, after which we will open the call to questions.

We announced in November that we completed our CE mark regulatory clinical study that was designed to evaluate the safety and performance of the first generation of the Symphony CGM system in 32 post-surgical patients in hospital critical care units in four investigational sites in the U.S. Data collected from the study served as the basis for the CE mark technical file submission for potential marketing approval in Europe. The mean absolute relative difference, or MARD, as compared to referenced blood glucose values was 12.5% in evaluable patients in the study. In addition, there were no unanticipated adverse events reported from the skin preparation or the Symphony CGM sensor during the study.

We submitted our CE mark technical file in January to support our CE mark application for the Symphony CGM system in Europe. We have received comments from the notified body and we are working with them to respond to those comments and update our technical file as needed to address their feedback. As previously mentioned, the CE mark trial was the first time we had used all three components of the currently configured Symphony CGM system, which we refer to as the Gen1 product, together in a clinical study. During the trial and in subsequent analysis, we identified a number of system modifications that could potentially improve overall performance and usability, and we have begun incorporating those modifications into our Gen2 product.

Based on the trial results and subsequent analysis, we have made a number of changes in the strategic approach that we are taking in the development of our Gen2 product. Two important decisions which we believe will be beneficial in terms of productivity, were to outsource software development and to make the switch to a contract manufacturer that better meets our needs. We are in the process of implementing these changes.

In terms of enhancements for the Gen2 system, we are implementing an updated algorithm modifying the skin prep device to obtain more consistent skin microabrasions and exploring an adjusted warm-up period and calibration schedule. As you recall, during this same trial we also identified senor interference with an IV formulation of acetaminophen but not with the more commonly used oral formulation. We believe we have identified a solution to resolve this interference issue and we are currently in the process of implementing the change into our Gen2 product. We believe that once we have made these product enhancements and assuming we gain CE mark approval, we should be prepared for a limited European market launch and initiation of the FDA pivotal trial with the Gen2 device. While it is difficult to predict timing on the implementation of these product enhancements, we currently believe that the limited launch in Europe and the initiation of the FDA pivotal trial will occur early next year.

In parallel to the product development process on the Gen2 product, our next steps with the FDA will be to meet with them again and submit a pre-submission supplement with a statistical plan, along with endpoints and other metrics. We also plan to file an IDE for a clamping study to manipulate glucose levels on volunteers with diabetes that will provide us with additional data on tracking and trending of glucose levels, particularly in the hypo and hyperglycemic ranges. The data collected in this study will help support our eventual PMA submission.

In December 2013, in connection with a capital raising transaction, we entered into a license, development and commercialization agreement with Medical Technologies Innovation Asia, or MTIA. As part of the agreement, Echo granted MTIA rights to research, develop, manufacture and market Symphony in connection with the development activities needed for regulatory approval in the People’s Republic of China, Hong Kong, Macau and Taiwan. MTIA is responsible for conducting all required clinical trials and for all development costs relating to regulatory approval of Symphony in that territory, as well as manufacturing and marketing costs relating to commercialization of Symphony. Additionally and most importantly, the company and MTIA will share future net sales of Symphony generated within the territory.

Later in December 2013 and January 2014, our agreement with MTIA was modified due to MTIA’s financial, regulatory, and currency exchange challenges, which are particular to China, in regards to the transferring of funds to Echo. The January amendment provides that Echo is not required to commence its obligations under the license agreement, including the transfer of any technology or other documents, products or information to MTIA until Echo has received the full proceeds from the capital raising transaction. As of March 26, 2014, the company has received approximately $2 million of MTIA’s anticipated $5 million in proceeds in accordance with the MTIA securities purchase agreement. We have been in regular communication with MTIA and believe the remaining funds will be transferred shortly as they deal with the issues associated with currency conversion and investment outside of mainland China.

Finally as you know, I stepped in as Executive Chairman and interim CEO pursuant to the terms of a consulting agreement in late August last year. At that time, we had begun the process of initiating a search with an executive recruiting firm for a permanent CEO; however, we decided it was prudent to put the search on hold until we completed and announced the clinical trial results and worked through a number of issues, not the least of which was completing the financing in December. Now that we have those things behind us and we have identified our path forward on the development of our Gen2 product, we have reinitiated the search. Liam Grieco, our lead director and chairman of the company’s nominating and corporate governance committee, will lead the process.

I would now like to turn the call over to Chris Schnittker, Echo’s CFO for a review of our 2013 financial results.

Christopher Schnittker

Thank you, Bob, and good morning everyone. Let me first review our financial position at the end of 2013. Our unrestricted cash balance as of December 31, 2013 was approximately $8.1 million. This cash balance does not yet include the net cash proceeds from the common stock financing with MTIA of approximately $2 million received to date as part of their total $5 million investment. Management believes that the total cash to be received from this common stock financing coupled with the cash on hand at December 31, 2013 will be sufficient to fund our cash requirements under our 2014 budget and carry operations through December 31, 2014.

Turning now to the fourth quarter 2013 financial results, operating expenses for the fourth quarter of 2013 were $3.1 million compared to $4.7 million for the fourth quarter of 2012. Research and development expenses were $1.3 million for the fourth quarter of 2013 compared to $2.9 million for the fourth quarter of 2012. Selling, general and administrative expenses were $1.8 million for the fourth quarter of 2013 compared to $1.7 million for the fourth quarter of 2012.

As a result of the above, we had a net loss available to common shareholders for the fourth quarter of 2013 after a $371,000 non-cash deem dividend charge resulting from the December 2013 financing of approximately $3.9 million or $0.36 per share. These figures compare to approximately $1.9 million or $0.48 per share for the fourth quarter 2012. As previously reported, we implemented substantial cost reduction measures across all aspects of our operations in both external spend and internal headcount at the end of the third quarter last year. Specifically on September 30, 2013, we implemented a staff reduction of approximately one-third of our workforce. As a result of these initiatives, our cash usage for the fourth quarter decreased by approximately 39% from the average quarterly cash usage experienced through the first three quarters of 2013.

Turning to the income statement for the full year 2013, operating expenses were $19.7 million compared to $15 million for 2012. This increase in operating expenses included an increase in research and development expenses by approximately $2.6 million to approximately $11.3 million in 2013 from approximately $8.7 million in 2012. Our R&D expenses increased primarily as a result of increased engineering and design expenses incurred with outside contractors and personnel related to Symphony development. Selling, general and administrative expenses increased by approximately $2 million to approximately $8.4 million in 2013 compared to $6.4 million in 2012. Selling, general and administrative expenses increased primarily due to pre-launch marketing and manufacturing activities in 2013.

As a result of the factors above, we had a net loss of approximately $19.1 million or $2.33 per share in 2013 compared to approximately $12.3 million or $3.12 per share in 2012.

Now I’d like to turn the call over to Dave Walton, our Vice President of Marketing and Commercial Development, to provide a commercial update. Dave, over to you.

David Walton

Thanks, Chris, and good morning everyone. As Bob mentioned earlier, we recently filed our CE mark technical file to obtain marketing approval for Symphony in Europe. Assuming that we obtain marketing approval and complete the product enhancements outlined by Bob, we anticipated updating the technical file and subsequently initiating a limited launch early next year in Europe. This will entail introducing Symphony to select clinicians and purchasing managers at hospitals in one to two markets. The focus of the limited launch will be to ensure that the commercial operations, such as initial training and technical support, are optimized to support a more comprehensive launch in Europe and other markets honoring CE mark, such as Australia. This early real-world experience will also be leveraged to augment a full promotional campaign before complete translations for other markets and languages will occur.

We are actively seeking a commercial partner to assist us in launching Symphony next year. We anticipate that we will establish a small direct field force that will be focused on medical education, key opinion leader development, and other market development efforts, and augment that with such a commercial partnership, likely with a single medical device company in Europe. We have held discussions with companies involved in patient monitoring, insulin dosing software, infusion pumps, and other products used in the ICU. While it is difficult to predict timing, the interest levels from potential partners has increased since our clinical results were first released and our technical file was submitted earlier this year, and we are focused on making this happen in 2014.

We expect the Symphony system will initially be purchased or leased by hospitals as a product to help them in caring for their ICU patients. Many of these patients are expected to be post-surgical patients recovering in the critical care units for one to three days. The pricing for Symphony and the daily sensors will vary depending on the country, the hospital, the number of units being purchased, and it may involve a combination of purchasing and leasing arrangements.

In order to increase awareness of our Symphony CGM system and generate demand for its use in the hospitals once approved, we plan to continue to conduct demonstrations and exhibitions during medical conventions and congresses in 2014, particularly those in Europe in order to ensure that the full range of Symphony benefits are well known and widely understood by the medical community. Just last week, Dr. Jeffrey Joseph of Thomas Jefferson University Hospital in Philadelphia, Pennsylvania presented data on our recent Symphony CGM system clinical trial during the poster presentations at the International Symposium on Intensive Care and Emergency Medicine, or ISICEM, held in Brussels. In addition to confirming the overall safety and accuracy of Symphony, this expanded analysis displayed the consistency of the data throughout the sensor session as accuracy in the first eight hours of monitoring was equivalent to that in the last eight hours of monitoring.

We remain convinced that the market opportunity for Symphony is significant. Clinicians know glycemic control is important. The medical literature is very clear that improved glycemic control pays immediate benefits on patient outcomes, such as reduced length of stay, ventilator usage, infection rates, and mortality, but clinicians are not always able to achieve the glucose levels they are targeting for their patients. There is significant room for improvement as approximately one-third of ICU glucose values across the U.S. and Europe are in the hyperglycemic range, which is greater than 180 milligrams per deciliter or 10 millimoles per liter according to several different hospital databases and publications. Those hospitals that attempt to maintain patient glucose levels in tighter target blood glucose ranges are only able to do so 30 to 50% of the time, based on some of the recent large studies published in the area.

The tools that clinicians are using are not ideal, and CGM can provide them with early alerts with immediate data and status updates to improve their glycemic management. Symphony, as the only non-invasive glucose monitoring option for the ICU could do this without introducing additional risks or complexities that might be present with some other approaches. As we move closer to finalizing the enhancements to the system, I look forward to updating you on our commercialization efforts and seeking a commercial partner.

Bob, now over to you.

Robert Doman

Thanks, Dave. That concludes our prepared remarks. Operator, we’d like to open the call up to a few questions.

Question and Answer Session

Operator

Thank you. We will now be conducting a question and answer session. [Operator instructions]

Thank you. Our first question comes from the line of Bill Patrali with Amran Investments. Please go ahead with your question.

Bill Patrali – Amran Investments

Hey, it’s Bill Patrali. A quick question. So it looks like you made a lot of enhancements to the Gen2 device in terms of outsourcing and changing your contract manufacturer. Can you just expand a little on why the changes were made and what you would expect?

Robert Doman

Sure. Certainly one of the things that we had back in October is we’d had a reduction in force to get our cost in line, so it made sense just from a cost basis, one, to outsource some of the software development since we don’t have a fixed cost with software engineers internally. So that was one reason, and we also had found we—we’ve identified someone who has got some very good experience in the glucose monitoring side of things, so we decided to make that decision and certainly we think that’s going to be more productive for us.

On the contract manufacturing side, we were utilizing really a contract manufacturer who really couldn’t meet our needs. They were chosen for the wrong reasons. They were a very large company, not dedicated to the medical device business – they had multiple businesses that they were involved in – and we’re basically a small fish in a large pond and not as responsive as we would like. Dan Sunday, our Vice President of Operations, went through a pretty good analysis of different companies that we should look at, and we’re moving to someone who is totally dedicated to the medical device business, it’s 100% of their business. They do assembly, testing, distribution and service, and—plus they had a much better cost structure than our previous contract manufacturer, and then they also have in the future overseas opportunities for us in terms of driving cost down.

So we thought overall it was best to make those moves from a strategic standpoint to help us move forward in the product development process.

Bill Patrali – Amran Investments

I see. Just one follow-up question real quick. In terms of timing of the launch in Europe, it looks like it slipped from Q4 until early next year. Just wanted to get some color on what has caused that slip in the schedule.

Robert Doman

Yeah, and good question because it does—I probably should have added a little more in my remarks on that. In the past—you know, part of it is due to the fact of the change we just discussed, right, moving to a different contract manufacturer who supplies our clinical supplies, and we had to get them up to speed, same as our software development house. So that takes some time just to get them moving and getting them to where they can help us and provide us the service we need. We felt it was critical for us to do that for our success going forward, so that was a significant change for us.

We also—and we changed our strategy on how we are looking at the product development process. Our original thoughts right after we announced the clinical trial results would be a two-step process to get into the FDA trial. We wanted to implement the change to resolve the IV acetaminophen issue and launch a product in Europe, so that was what we were originally referring to as our Gen2 product, and then work on the remaining product enhancements in parallel to get ready for what we were at that point in time referring to as our Gen3 product, which would be used for the FDA trial. But under further analysis and clinical data, it made much more sense for us to incorporate everything into the Gen2 product and get that ready for both the European launch and use the same product for the FDA.

So again, I think it goes back to the productivity issue and the fact that we wanted to incorporate all the enhancements we’ve identified into the next generation and use that for the launch in Europe and the U.S., versus what we were thinking right after we announced previous clinical results. I’m sure you can imagine, you can learn a great deal any time you do a clinical study in the hospital marketplace, so we had actually considered when we first saw the IV acetaminophen issue in the clinical trial that we may stop the trial, but we considered all the value associated with continuing it and we learned a lot, a great deal on that trial. And again, as we mentioned, it was the first time we ever had all three components in this system in the hospital market, in the hospital environment. So change in strategy in terms of the product development and the generations, and the change in some of our key vendors pushed that timeline out.

Bill Patrali – Amran Investments

I see. Just finally on a different topic, since Bob you’re not going to take on the permanent CEO role, are you still going to be on the board?

Robert Doman

You know, I was a board member when I stepped in as interim CEO, and initially- we kind of laugh about it now – we thought it was going to be three days a week, and it didn’t turn out that way from the very beginning. But certainly the board knew from the very beginning that I was not interested in taking on a permanent CEO role, and as I mentioned in the remarks, I think we’re all—we all feel that we’re in a much better position right now, that we had a number of issues that we were dealing with. We think we have those things in order. We have clear cut product pathway now on development, and I think we’re in a much more stable position, so it made sense to do it. Certainly at this point, I intend to remain on the board. I’m hoping that I can bring a little more value now that I’ve been immersed in this for six or seven months to the table when we have board meetings in the future.

Bill Patrali – Amran Investments

Great, thanks a lot.

Operator

Thank you. Our next question is from the line of Ben Haynor of Feltl & Company. Please go ahead with your question.

Ben Haynor – Feltl & Co.

Good morning everyone.

Robert Doman

Morning, Ben.

Ben Haynor – Feltl & Co.

Just a few quick ones here. In terms of the system modifications, how are those coming along? Are you 10% there, are you halfway there? Can you maybe characterize where you’re at in the process?

Robert Doman

You know, hard to handicap that one, Ben. Certainly we’ve made progress on the IV acetaminophen issue. We’ve been doing a lot of bench testing and end testing on in-house, we’ll call them subjects I guess – they’re not patients, and we continue to move forward on that one. We brought in a consultant, a skin physiologist expert to help us on some of the abrasions we were doing, and that’s one of the key things that we’ve been focusing on.

The crown jewels here for us are in that abrader and then the algorithm in the abrader, and that’s the thing that we’ve been spending a lot of time on understanding and based on the results that we have, and that’s where a lot of our focus is on going forward. And then we have general software bugs that you identify that are constantly you’re also improving, so I do think that we’ve slowed down the process a little because of the strategic changes we made in our partners, and the other things why we’ve identified, and I think more importantly we’ve identified some bench testing that we can do to verify some of the changes we’re making in the product, which we didn’t do previously.

So I think we have a very good understanding now of where we are and what we have to do, and I’m not sure we had that back in November when we first got the clinical results back.

Ben Haynor – Feltl & Co.

Okay, that’s very helpful. Then on the clamping study, how many patients do you think that’s going to have to be?

David Walton

It may be in the realm of 15 patients. We’ve been talking to an investigator who has done a number of these clamping studies and with manipulating down to 40 and going up to hyperglycemic ranges, and the approach that you do that. We’ve had discussions about the protocol around that. We haven’t finalized that yet, but I think a reasonable ballpark estimate is probably 15 patients.

Ben Haynor – Feltl & Co.

Okay, great. Then lastly, can you maybe provide a little bit more color on how the Dr. Joseph presentation went at ISICEM?

Robert Doman

Yes. There were dozens of simultaneous poster presentations taking place around the conference, but we certainly had good attendance around our area and there were people such as (Indiscernible) Vandenburg (ph) in the audience there listening to the presentation, and our results were compelling. We feel good about not only doing the poster presentation—I mean, the value there is one thing, but really it’s then it being published, the abstract in the Critical Care Journal, it’s now being able to share this with potential business development partners as well. It certainly was a productive week there, meeting with some of the companies that are over at that conference.

Ben Haynor – Feltl & Co.

Great, yeah. I mean, it sounds like the first eight hours being equal to the last eight hours is pretty impressive, so that’s all—

Robert Doman

Yeah, Ben, what I would tell you is the gold standard in the outpatient setting is a Dexcom CGM sensor that has a MARD that’s down in the 12% range. But on Day 1, their MARD is 16.7%. It is known a lot of the subcu sensors certainly, and some of the invasive ones that are being studied for the hospital, don’t perform as well right off the bat; and we know, being a 24-hour sensor, that we don’t have the luxury of waiting a long time to have good performance. So we are pleased with that accuracy in showing that a MARD around 13% in the first eight hours and low 12% in the final eight hours, that’s pretty good consistency, and we certainly heard that from those who attended the posters.

Ben Haynor – Feltl & Co.

Excellent. Well, that’s all I had. Thank you very much.

Operator

Our next question is from the line of Anthony Vendetti of Maxim Group. Please proceed with your question.

Dan Akivis – Maxim Group

Good morning guys. It’s actually Dan Akivis in for him. I had a quick question. Do you guys have an approximate price range for the different components in Europe, and how that might be different from the pricing in the U.S., or eventual pricing in the U.S.?

Robert Doman

Yes, so I’ll tell you – and it’s interesting. Walking the floor at the conference, I was able to talk to a couple of different competitors and other people about some of the pricing that may be seen over there. So a couple of data points here – we expect there will be a range, depending on whether a hospital is more interested in limiting upfront cost and just paying for the value of the system through consumables, so there certainly are hospitals there that would rather arrange kind of a low-price rental with a volume commitment to buy ongoing sensors, and in that kind of a situation we would expect that we’d be looking at at least $100 a day for consumables in that kind of a scenario. If someone were more interested in purchasing equipment, then it’s going to be a several thousand dollar upfront payment and then the consumables price might be reduced there. But there are a number of factors that go into this around volume of consumables that someone might be interested in.

A researcher who is involved with multiple competitor systems, in one of the lectures referenced that a €100 to €200 price for CGM for a couple of days certainly seems very reasonable, based on what he has seen and what discussions have been at his hospital. But again, this is—these are just individual instances and there’s going to be a wide range.

Dan Akivis – Maxim Group

Got it, okay. That’s the only thing that we had. Thank you.

Operator

Our next question is coming from the line of Nathan Cali of Noble Financial. Please proceed with your question.

Nathan Cali – Noble Financial

Hey guys, good morning.

Robert Doman

Good morning, Nathan.

Nathan Cali – Noble Financial

Just a couple quick questions. Can you just talk about, again, the timing of CE mark approval, and then the U.S. timing as well?

Robert Doman

Yeah, Nathan, CE mark approval – you know, I think we said second quarter sometime we would expect to hear back from them, so we’re still anticipating that. FDA – I mean, we’re probably looking at first quarter of next year of getting into an FDA pivotal trial. Our sense and feel on that from preliminary discussions with them on when we’ll be looking at getting this finalized, is that we think it will probably be about a six-month trial based on our current estimate of number of patients, and then the submission of the PMA. So we’re probably looking at 2016, early 2016 time frame.

Nathan Cali – Noble Financial

Okay. All right, thanks a lot.

Robert Doman

You’re welcome.

Operator

Thank you. Our next question is coming from the line of Stephen Dunn of LifeTech Capital. Please go ahead with your question.

Stephen Dunn – LifeTech Capital

Hi guys. In the interest of time, just some quick housekeeping on the timing of the Gen2 and the U.S. clamping study. It sounds like you’re going to use your Gen2 unit for the FDA trial instead of going to a Gen3 for FDA. So are you going to wait—it sounds like you’re going to wait until you finish your trial testing for Gen2 and then use that unit to begin your clamping study in the U.S. Is that correct?

Robert Doman

Yes, and we think we’ll be doing that late this year.

Stephen Dunn – LifeTech Capital

Right. Do you expect—I don’t know how long your list is on the EU—well, I was going to say EU, but ex-U.S. distribution partners, do you expect to have that—something inked before you get the results from Gen2? In other words, you could be signing it on Gen1 CE mark, or you think your partner is going to wait until Gen2 approval?

Robert Doman

Yes, I think certainly with the CE mark on the Gen1 and acknowledgment of how we’re progressing on the Gen2, that we feel that—and based on the conversations we’ve been having already, we don’t necessarily have to wait for Gen2 to be complete to sign a partnership. It will be a balance of do we think it’s the right thing for us and for shareholders, but certainly it’s not just jumping at the first one, and there are a couple who would like to make sure that Gen2 is on track. So the closer we get to being done with it, certainly the more certainty is there for our partner. But we’re focused on trying to sign a partner this year so that we can begin the preparations for the launch next year.

Stephen Dunn – LifeTech Capital

Okay, but to be clear, then, to set investor expectations, a distribution partner would be more to the back end of this year than sooner?

Robert Doman

Yeah, I think that’s a reasonable assumption.

Stephen Dunn – LifeTech Capital

Okay, great. Thank you.

Operator

Thank you. At this time, I will now turn the floor back to Mr. Doman for closing comments.

Robert Doman

Thank you. In closing, the clinical trial that we completed last year on our Gen1 system not only validated our technology but also provided us with significant information on what product enhancements we want to implement on the Gen2 product for eventual launch in Europe and initiation of the pivotal FDA trial. We believe that once these enhancements are in place, we will have a robust product that will address an unmet customer need and a large underserved opportunity in the hospital critical care setting and beyond. I’m very excited about the potential of the company’s technology and its ability to monitor glucose continuously, wirelessly and non-invasively in the hospital environment.

Thank you for joining us today and we look forward to providing you with updates in the future.

Operator

This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.

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