Bristol-Myers Squibb Company (NYSE:BMY)
Q3 2007 Earnings Call
October 25, 2007 10:30 am ET
John Elicker - VP IR
James Cornelius - CEO
Andrew Bonfield - CFO
Lamberto Andreotti - EVP, COO of Worldwide Pharmaceuticals
Elliott Sigal - Executive VP, CSO and President, R&D
David Risinger - Merrill Lynch
Tim Anderson - Stanford Bernstein
Barbara Ryan - Deutsche Bank
Roopesh Patel - UBS
Steve Scala -Cowen Investments
Seamus Fernandez- Leerink Swann
Catherine Arnold - Credit Suisse
Tony Butler - Lehman Brothers
Good day and welcome to today's Third Quarter Earnings 2007Earnings Release Conference Call. This call is being recorded.
At this time, I would like to turn the call over to Mr. JohnElicker, Vice President Investor Relations. Please, go ahead sir.
Thank you Kim and good morning everybody. Thanks for joiningus on the conference call to review our Q3 results. Hopefully, as you havegotten the release in the financial, additional financial information that wepost on our website.
With me this morning is Jim Cornelius our CEO and AndrewBonfield, our CFO who will have prepared remarks. And then joining them forQ&A are Lamberto Andreotti, who runs our pharmaceutical and medicinesbusiness and Elliott Sigal our Chief Scientific Officer.
So, before we get started and I turn the call to Jim, let metake care of legal language. During this call we may make various remarks ofthe Company’s future expectations, plans and prospects that constituteforward-looking statements for purposes of the Safe Harborprovisions under the Private Securities Litigation Reform Act 1995. Actualresults may differ materially from those indicated by these forward-lookingstatements as a result of various important factors, including those discussedin the Company’s most recent Annual Report or Form 10-K and in our periodicreports on 10-Q.These documents are available from the SEC, the BMS website orfrom Bristol-Myers Investor Relations.
In addition, any forward looking statements represent ourestimates, only as of today and should not be relied upon as representing ourestimates as of any subsequent date. While, we may elect to update forwardlooking statements at some point in the future, we specifically disclaim anyobligation to do so even, if our estimates change.
With that, let me turn it over to Jim.
Thanks John and good morning everyone. I’m going to make afew brief comments on our financial performance this quarter and then I'lladdress some recent pipeline and strategic achievements. Finally, I'll updateyou on the status of our productivity efforts.
We are very pleased with our performance this quarter.PLAVIX and our other key products continue to grow, many at double-digit rates.We delivered EPS of $0.43 on a GAAP basis and on a non-GAAP EPS basis of $0.38.We are raising our full year 2007 non-GAAP EPS guidance to a range of a $1.42to $1.47. We are also revising our full year 2007 GAAP guidance downwardbetween the $1.28 and $1.33 from $1.35 to $1.45 to reflect the accountingimpact of our acquisition last week of Adnexus Therapeutics, which will beaccounted for in the fourth quarter of this year.
We are also reaffirming EPS guidance for 2008, range of a$1.60 to a $1.70 per share, subject to a certain assumptions and excludingcharges related to our cost reduction imitative. We continue to execute ourplan for the year, building out our growth franchises in cardiovascular,oncology, virology, psychiatric disorders and immunoscience, while managingcost and investing in new products and R&D.
As you know the FDA gave approval last week for our newbreast cancer treatment ixabepilone, which will be marketed globally as IXEMPRA.We launch earlier this week in the U.S.and we've filed for approval in Europe. Thismedicine is another key step in our return to leadership in the oncology arena.
As I mentioned before, we are expanding our presence inbiologics across the board, from discovery through the commercialization.Construction on our new biologics manufacturing facility in Devens Massachusetts is on planand on budget, and we expect it will be a major provider of our biologicstreatments beginning in 2011.
In addition, the $415 million purchase Adnexus Therapeutics,a privately owned Biologics Company gives us access to a proprietary nextgeneration biologics platform that will help us discover and design new proteintherapeutics, and build out our pipeline. Same time we gain a promising Phase Ioncology compound Angiocept approximately 40 new scientist.
Now, I would like to update you on the status of our ongoing strategic review in productivity efforts. The Adnexus purchase is a goodexample of how we are redeploying resources to reinforce our strategic emphasison growing specialty and biologic medicines. A separate transaction thisquarter, we sold a mature non-core business, tumor brand in Japan were approximately $250million. This sale shows how we are releasing resources they can used forinvestments that better suite our strategic focus as Adnexus deal does. Therewill be more of this in the future.
You may recall, we've been looking at strategic options infour core business clusters, that being CV, metabolics, specialty medicines,the mature brands and the healthcare group. The overall goal is increasingshareholder value by growing revenue, expanding our margins and improving cashflows.
As a part of this review, we’ve begin a significantproductivity initiative across all business units. Looking to transform andstreamline the company starting now and continuing over the next three years. Itold you last year that is a part of that transformation we will be eliminatingsome physicians in the company and we will continue rationalization offacilities. As I said, we've already begin removing certain jobs and we willsee more physicians eliminate in the coming weeks and in 2008.
Our work so far has validated my view that it’s possible tofind significant savings at the same time making our company stronger andbetter focused on shareholder value, patient needs and then challenges over thecurrent healthcare landscape.
My confidence in this strategy, our new product potential,our people and our management team at BMS, as it grows, every day I am in theCEO job. It’s amazing what a difference a year makes and employing aroundbusiness outlook. I firmly believe we deliver on both current performanceexpectations and future growth. The real winners will be patients in theirfight against serious disease.
We hope to see many of you in our Investor Conference onDecember 5th. At that point we will brief you on the details of thestrategic review and our productivity efforts.
Now I'd like to turn the call over to Andrew for a moredetailed review of the quarter.
Thank you Jim and good morning everybody. I would like tobriefly discuss our third quarter results and our guidance before we go to yourquestions.
As you have seen from our release we recorded earnings pershare of $0.43 for the quarter. That includes the positive impact from the gainon the sale of the BUFFERIN and EXCEDRIN brands in Japan. Excluding specified items,fully diluted earnings per share on a non-GAAP basis was $0.38. The fullreconciliation of GAAP to non-GAAP earnings per share is posted on our websiteas usual.
Total company sales were $5.1 billion, up 22% compared tolast year driven in part by the favorable PLAVIX comparison. Overall, we saw a4% impact from price, a 3% benefit from foreign exchange and an increase of 15%in volumes. Worldwide pharmaceutical sales increased by 24% to $3.9 billion,reflecting the impacts of generics of PRAVACHOL last year and a 3% benefit fromforeign exchange.
Our healthcare group generated sales of $1.1 billion, up12%including a 4% benefit from foreign exchange; sales in our U.S.pharmaceutical business increased by 42% to $2.3 billion, excluding theestimated impact of generics for PRAVACHOL last year. U.S. sales would have been up in a4% to 8% range.
Sales in our international pharmaceutical business increasedby 6% to $1.l6 billion due to a 6%foreign exchange benefit. Worldwide record of PLAVIX sales were $1.3 billion ofwhich $1.1 billion was recorded in the U.S., up 128%.
This reflects the impact from generic competition, estimatedto be between $525 million and $600 million last year. Excluding this, U.S.sales would have been up between 0% and 8% reflecting total script growth of 7%in the quarter. Script growth trends by the key products were strong. ABILIFY,REYATAZ, SUSTIVA FRANCHISE all had double-digit script growth and sales growthin the quarter. Sales for ABILIFY were up 27% in the U.S behind 10% scriptgrowth and the timing of price increases.
International sales were up 72% driven by continued growthacross Europe and the 7% benefit from foreignexchange. Sales of REYATAZ in the U.S. were up 9% behind 10% scriptgrowth.
International sales increased by 27%. SUSTIVA Franchisesales were up 18% globally, behind the strong performance of ATRIPLA. ORENCIAgenerated sales of $60 million and we are in the process of launching in theEU.
Global SPRYCEL sales were $46 million, including anotherstrong quarter in Europe. BARACLUDE generatedsales of $72 million globally; international markets are performing well, withsales of $50 million in the quarter.
Excluding specified items in both periods, the gross marginincreased by 170 basis points to 68.2%, due to the positive impact from strongsales for PLAVIX, and our Virology business, ABILIFY, SPRYCEL and BARACLUDE.
Compared to the second quarter, reported gross margins fellby 0.6%. This was mainly due to one time price adjustment in Europerelated to prior years and the decrease in the healthcare gross margins, due toadverse mix in [computech] and medical imaging.
Pharmaceutical product mix had little effect on the grossmargin, despite the adverse impact of lower PRAVACHOL and higher ERBITUX sales.
Marketing, selling and administration expenses increased by2% for the quarter, mostly due to foreign exchange rate fluctuations.Advertising and promotional spend increased by 23%. This reflects appose inspending last year in the quarter as well as increased investment in PLAVIX,ABILIFY, DTC advertising and spending behind the expected IXEMPRA launch.
Excluding specified items R&D expense for the quarterincreased 4% to $767 million. This reflects higher development spendingpartially offset by the cost sharing impacts from our partnerships withAstraZeneca and Pfizer.
We continue to fully invest behind our late stage projectsand our acquisition of Adnexus reflects our business development efforts, as welook to identify early stage opportunities to strengthen the front end of thepipeline.
The effective tax rate, excluding specified items is 21.1%,in line with our guidance for the remainder of 2007. Net debt decreasedslightly to $2.5 billion, from $2.6 billion at the end of the second quarter.The impacts of the Adnexus acquisition will be reflected in the fourth quarter.
As you've seen in our press release, we are updating a fullyear 2007 GAAP and non-GAAP guidance. Our GAAP guidance is now at $1.28 to$1.33 a share, reflecting the impact of the Adnexus acquisition in the fourthquarter.
We have increased our non-GAAP guidance to $1.42 to $1.47per share. This reflects a strong operating performance we've seen through thefirst three quarters.
Our line item guidance remains unchanged.
As I mentioned last quarter, diluted shares outstanding areincreasing, and this increase was 20 million shares compared to the thirdquarter of 2006, primarily as a result of increased option exercises. We expectdiluted shares outstanding to continue to increase in the fourth quarter.
We have also reaffirmed our full year 2008 non-GAAP guidanceto $1.60 to $1.70 per share. I'll quickly review what we said last quarter. Weexpect revenue growth to increase in the mid to higher single digit range. Thisincludes continued strong growth from our specialty and cardiovascularproducts, slower growth from the healthcare group, and sales declines from theamateur brands.
Gross margin should improve slightly compared to our 2007expectations. We expect R&D expense to increase in the mid single digitrange, and the rest of total operating expenses should be flat.
The effective tax rate should be in the 22% to 24% range,slightly higher than this year. We also expect shares outstanding to increasefrom current year levels.
Finally, our 2008 guidance excludes specified items not yetidentified including charges related to our cost reduction initiative that arelikely to be material. We will provide you more details at our Decembermeeting.
So in summary, our third quarter performance was solid andour base business, including our key brands, newly launched products and otherhealthcare businesses continue to perform well. The strength of that businessis reflected in our increased guidance range. We have reaffirmed our initialoutlook for 2008, and look forward to seeing you at our Investor Meeting onDecember 5th in New York.With that I’ll hand back to John for the Q&A Session.
Thanks Andrew, and Kim, I think we’re ready to go to theQ&A sessions. I would just ask people to keep their- in an effort to get asmany questions in as possible, keep your question limited, if possible. Andsecond, to remind you that in addition to Jim and Andrew, we have with us heretoday Lamberto and Elliott to take any questions you might have. Kim?
(Operator Instructions) And our first question comes fromDavid Risinger, Merrill Lynch.
David Risinger -Merrill Lynch
Yes. Thanks very much. I have a couple of quick questionsplease. The first is could you provide a little bit more color on the Nutritionalsbusiness strength year-over-year and sequentially? Second, could you providesome more details on vinflunine giventhe sentence that you put in the press release? And then third, could youprovide an update on Saxagliptin and your discussion with the FDA and whetheryou are still on track to file that product in the first half of the next year?Thank you.
David, just on the nutritional business, business has beenperforming well, particularly in the international markets, that the growthtrend has continued particularly around the infant formula and toddler andchildren nutritional in Asia and Latin Americaas well. In the U.S.,we also saw some sales growth due to some weak contract transitions, which didbenefit sales in the third quarter. You should also be aware that obviously,with the impacts of dairy prices we have been raising our prices and that hashad a positive impact on sales growth in the quarter.
David, this is Elliott and you asked about vinflunine and Saxagliptin.With regard to -- first of all, with vinflunine we are in partnership with PierreFabre and we have announced that we will now pursue the submission ofvinflunine for the treatment of bladder cancer. With our partner we are currentlyreviewing the clinical development plan and we are evaluating ongoing researchprograms. I would step back and describe the strategy in oncology is to be ableto achieve our contribution in novel cytotoxic, which we have been able toachieve with ixabepilone. We think this is very important to have novelcytotoxic that will be backbone to chemotherapy and backbone to new targetedagents. And we are expanding into biologics, other targeted agents or hormonetherapy and immunotherapy, but as we make other decisions of about vinflunine,we’ll let you know
I don’t have new information on Saxagliptin. As we discussedbefore, we are in discussions with the FDA. The central issue has been druglevels that may result in broad clinical practice. There has been concern inthe field with regards to our findings in monkeys and we have studiedSaxagliptin extensively. It's well tolerated at high multiples of expectedusual clinical dose, up to 10 times and 40 times and we have PK data from asingle dose study in patients with renal insufficiency. Because of activitiesin the field, we have been proactive in initiating the dialogue with the FDAabout patients with renal impairment.
And when we have more information we will let you know.Until then, we can't be more specific about the regulatory discussions. And aspreviously stated, we continue to plan a submission for Saxa in the first halfof 2008, depending upon positive outcomes from our Phase III trails and ongoingdiscussions.
And I will note the recent events suggest that there is amore cautious environment everywhere, including in the FDA. In addition ofapproval metric show that only 25% of standard reviews received first cycleapproval. And although we don't currently see a reason for delay with Saxa, thereare many factors that play here that could impact time lines. We'll let youknow when we have more information.
Thanks David. Kim, can we go to the next question please?
We will go next to Tim Anderson, Stanford Bernstein.
Tim Anderson -Stanford Bernstein
Thank you, actually another question on Saxagliptin. Myunderstanding is that the drug has some sort of unwanted side effect onplatelets like thrombocytopenia and I am wondering if you can confirm that orgive us any details behind that?
Second question is on ABILIFY as it stands today, you arescheduled to hand that back to Otsuka at the tail end of 2012. And I amwondering if you can comment on the likelihood that you might be able to extendthat agreement beyond 2012?
Just quick comments on Saxagliptin, in phase II studies athigher doses there was a slight decrease in platelet counts, but the mediumvalue stayed with in the normal range. In our un-blinded phase III studiesto-date, we have not seen the signal for thrombocytopenia. We are monitoringall potential safety issues as we go the phase III program
And about ABILIFY, we have an excellent working relationshipwith our partner Otsuka. Obviously, we entertain discussions about many things,but it is not appropriate for me to discuss what will happen after theexpiration of contract in 2012?
What I can discuss today is that it is probably performingvery well in the marketplace. The market is increasing, growing in the U.S.,and our market share is growing too. And at the same time we have increased ourprice, so we had a combination of market share growth and growth of the sellingprice.
We have three new potential indications coming soon inuni-polar depression and to adolescent schizophrenia and adolescent bipolarindications. We have got lot of time to get ready or these indications. We haverecently realigned our sales force. This will allow us to have 15,000 moredoctors in our medical file, and 8,000 will be doctors that might beinterested, will be interested in depression, and the rest is doctors that willbe interested in pediatric indication.
As you may have known we have extended our DTC campaign. Wehave gone live on television. We have a new bipolar campaign and feedback fromthe marketplace is very positive. We are very confident about these products,its efficacy profile, and a different tolerability profile makes it a goodproduct.
And in Europe, where we had at the beginning some concernsof not having probably positioned it fully well from a point of view efficacy,we see a good return from our refocusing our activities and we are growing inall countries in the European Union.
Tim, just to add that we will have the partnership in Europefor 10 years so that actually, it will last through 2014.
We'll go next to the Barbara Ryan, Deutsche Bank.
Barbara Ryan -Deutsche Bank
Good morning. My question was asked. Thank you.
We'll go next to Roopesh Patel, UBS.
Roopesh Patel - UBS
Thank you. I've got a couple of questions on PLAVIX. Firstwe’ve been seeing the meaningful deceleration in growth for the (inaudible)molecule. Where do you see this bottoming, by when and what do you expect to bethe key drivers? And then separately, I was just wondering if could offer usyour perspective on Lilly's announcement yesterday on Prasugrel, based on whatyou know what you think that means at a minimum for Plavix? Thank you.
Thanks Roopesh. Before I turn it over to Lamberto to discussPLAVIX trends, I don't think it would be appropriate for us to comment onLilly's press release yesterday at all.
And this is obvious and what I can say about PLAVIX and Iwould discuss about the performance of PLAVIX in a second. PLAVIX is theproduct that's been used by 70 million people around the world. It is, it’sbeen started in all over 100,000 cases in eight diseases and what we althoughit's want to remember is that its not only eight diseases but also different stagesof those diseases. So we have a lot experience with its products in manyindications and in many different stages of the disease.
We are very happy to be back alone in the market place inthe U.S.We don’t have generic competition any longer. And we are very happy, but duringthat period where we had generic competition we continue to invest veryeffectively and very aggressively. It is true, there is a known positive factorassociated with the decrease ban procedures in the U.S. It is estimated that 15% or18% less ban procedures are taking place now in the U.S., and it's probably also truethat number of patients that are admitted to hospital for ACS problems isslightly decreasing.
On the other hand, we have a PAD opportunity that continuesto be big for us and important for us. And we have a lot of focus on earlyinitiations and that continuation of the therapy over longer period of time. Wehave some indicators that for example, from the number of prescriptions ofsecond prescription to that field, but these are indicators of the fact thatlots of therapy is actually going out, and Medicare Part D was also from pointthat view.
To continue to work on early initiators, we have intensifiedour efforts in hospitals. We have more FTEs, full time equivalence from oursales force, in the hospital place to facilitate more initiation of therapy,and earlier implication where we have intensified DTC. We had, we started withan unbranded PAD campaign few months ago, good return from that campaign and wehave now very recently moved to a branded campaign. So, yes, we are concernedabout trend in the stent market, but we have many other markets to look at fromand from where PLAVIX can continue to give good results. 7% growth ofprescriptions year-over-year after many years in the marketplace, it seems toindicate that we have a good story.
Thanks Roopesh. Kim can we go to the next question please?
We will go next to Steve Scala with Cowen Investments.
Steve Scala -CowenInvestments
Thank you. I have two questions, first Bristol has said previously that its businessplan assumes launch of Prasugrel in 2009. Since the company said thatpreviously, I wonder if you would reiterate that today or perhaps notreiterated it. And secondly, for Dr. Sigal regarding Erbitux, in your opinionwhat type of survival advantage from FLEX would be clinically relevant to the U.S. market anddoes FLEX meaningfully increase your optimism for Erbitux commercial prospects?
Steve, just to reconfirm, yes, we did assume in our businessplanning that Prasugrel is launched and it will have an impact, actually smallimpact in 2008, and actually a bigger impact in 2009 and 2010
Yes, Steve, this Elliot. The Erbitux data on lung that youare referring to the FLEX study, which was announced by our partner E. Merckhad positive result on the primary end point for overall survival. As they havebeen stayed in, the data continues to be analyzed. And they will present thedata next year. They have announced that they would present the data in June.So, we have to await the data presentation, and then presentation and thediscussion.
I do feel that any study that has a positive effect onoverall survival has a very important medical opportunity in lung cancer. We dohave a second study that had a primary end point of progression free survival,when reviewed by independent radiologist it did not prove to be successful,although many secondary end points were positive.
And we are studying the correlation and the meaning of bothof these studies. As you know, the studies were done with different backgroundof chemotherapy. The FLEX study on the background is typically used in Europe, where as the one in US was our study.
We are waiting, as their survival study or the survivalresults of the old '99 study that did not have a conclusive primary end pointof progression free survivals. So, when we get all that data together, when wecontinue discussions with the FDA, we'll have a better idea of where we are.
But I would want to end with the medical need that as firstline metastatic lung cancer, there's a significant opportunity, because thegood proportion of patients do not take Avastin, because of the concern aboutthe side effect. And these are patients that have central lesions or mainly squamouscell carcinoma. Though it is interesting from a medical standpoint tovigorously pursue the use of Erbitux in lung cancer, and we will do so.
Thanks Steve. Kim, can we go to next question please?
Seamus Fernandez,Leerink Swann.
Seamus Fernandez - Leerink Swann
Thank you very much. Just actually asking for a quick updateon some of the pipeline products that we know are in development. I was hopingElliott, that if you could give us an update on the belatacept program as wellas the CRF development program. I believe you have three Phase II studies withyou CRF antagonist on going right now. I am just wondering, if you could giveus a little bit of an update there? Thank you.
Yes, I would like to plan a fuller update. We are planning afuller update for you in December. We will layout for belatacept andparticularly why we are interested in this from a medical and commercialstandpoint; go over our Phase III studies, the updates of the Phase II data.The belatacept opportunity is very exciting and preventing rejection of organtransplantation the first indications in renal disease. We fully enroll thesestudies we hope to have data from our Phase III next year. What we haven'thighlighted that particular program its late stage and we'd like to discuss itmore fully December 5th. And I don't have any updates on our CRF program, weare running Phase II studies in depression and in anxiety, I don't have theupdates for you on the science today.
Thanks Seamus. Kim, can we go to next question please?
Yes. Catherine Arnold, Credit Suisse.
Catherine Arnold -Credit Suisse
Thanks very much. I have two questions, first for Jim. I amspeculating that you have interest in selling your ConvaTec and/or nutritionalbusinesses. And I was wondering if you could just remind us of your view on thestrategic importance business strategy, regards overall diversification to the CorePharmabusiness? And secondly, for Elliott, I was wondering if you could just clarifyyour Saxagliptin exposure in human is obviously very high relative to what youexpect the normal dose to be? Could you tell us if you have seen any edema andany other studies in humans from monkey’s entire exposure?
Catherine, on the healthcare group it's much like the otherthree clusters. There is ongoing work as to what is the best way to enhanceshareholder value there. So, again I will, like some other question in thismorning, hold our final comments until December 5th on that issue.
Catherine, this is Elliott. On Saxagliptin, we have not seenthe edema that's been described and discussed in other programs we are inmiddle of our Phase III studies and completed Phase 1 studies, Saxagliptin hadbeen administered in doses up to 40 times the maximum dose and exposure beenutilized in Phase III studies for two weeks as a duration. And completed PhaseII study Saxagliptin was administered in doses up to 10 times the maximum doseand exposure being utilized in Phase III study for durations of six weeks.
Based on completed Phase I and Phase II studies and datafrom two unblended Phase III study of 24 weeks duration, we've not detected asignal for hand-foot, edema or paresthesias, or itching during exposure toSaxagliptin. We are monitoring all issues that people are theoreticallyconcerned about in this field and we will be completing our Phase III programnext year.
Thanks Catherine and Kim, I think we've time for two morequestions?
Next question is from Tony Butler, Lehman Brothers.
Tony Butler - LehmanBrothers
Thanks, briefly, another question on Saxagliptin. Do youactually have back-up compounds, which have not illustrated the toxic effectsin primates? And if you don't, why haven't you moved those forwards and if youhave, how far are they subjected to the existing escrow agreement? Thanks verymuch.
We do have a vigorous back-up program for most of ourprograms, including Saxagliptin. We have a variety of back-up programs. We aremoving them forward. We haven't released any clinical data on that, but we'llbe prepared to describe more in December with regard to our strategy, if Icould.
Thank you Tony and Kim, I guess we will take our lastquestion.
And our final question comes from David Risinger, MerrillLynch
David Risinger -Merrill Lynch
Sorry, I've got a couple of quick ones. Andrew you mentionedthat you have 10 years on ABILIFY. I was just wondering if that’s in the EU orif you are saying that have the partnership through 2014 in the U.S.?So, that’s my first question. And then could you just update us on the timingof the ixabepilone potential approval in the EU? Thank you.
David, sorry, it was what I did try and say it was 10 yearsin the EU. So in the EU we will have it through 2014. Obviously, it's correct.It's 10 years from launch in the U.S. so, that will be November2012.
And as far as ixabepilone is concerned, we have filed in Europe. So, we expect the normal timing for the reviewand approval. We are getting ready for that launch. And as we are thinkingabout IXEMPRA, we havelaunched as it was said before, in the U.S. and for that launch, we haveput together a new sales force. We have a 90 plus people and 20, approximately20 medical scientifically on people. So, we are very focused on this product.So it's an opportunity to be build over time, there is an unmet medical needthere and we expect oncologists in the U.S. to get acquainted with theproduct over time and at the same time we expect additional data to beavailable on overall survival an additional indication. So, it is a productthat we are building. We’ve attention and with the right people on track.
Thanks David. And so I would like to turn the call over toJim for some closing remarks.
Well, let me conclude by just saying the team is continuingto execute our strategy, simply increase revenues and grow earnings. We arewell along in our productivity initiative. We look forward to deliveringsubstantial savings over the next several years that we can plough back intothe business and research and development at the same becoming a much moreefficient and flexible company. While I have more to say about the strategicreview and the productivity efforts at our Investor meetings scheduled forDecember 5th, we look forward to seeing you there. Thanks very much.
Thanks everybody for joining us, obviously, we are availablefor follow-up calls at our offices. Thank you
This concludes today’s conference. Thank you for yourparticipation. You may disconnect at this time.
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