MyDx's (MYDX) CEO Daniel Yazbeck on Q4 2016 Results - Earnings Call Transcript

| About: MyDx, Inc. (MYDX)

MyDx, Inc. (OTCPK:MYDX) Q4 2016 Earnings Conference Call April 20, 2017 1:00 PM ET

Executives

Daniel Yazbeck - Founder & Chief Executive Officer

Daniel Yazbeck

Okay, hello everyone, and welcome to the MyDx earnings presentation and many thanks for the joining and to learn more about our company. We have a lot of great things to talk about today and we’re really excited to share our view of the future with you. But before we get started, many people have questions about the 10-K, we intent to file the 10-K as soon as we can. Our auditors are being especially diligent in the performance of their duties and please know that it is coming soon. In the meantime, the financials presented in this presentation gives us guidance until the actual 10-K is filed.

For those of you new to MyDx, we are a science and technology company focused on providing consumer products and data analytics to the cannabis space. Now, how do we do that? Well, we use the insights provided by the data we generate via our existing smart technologies and devices to create new products and services and we are going through that in this presentation.

And it is an exciting time for the company and the cannabis industry, our company is backed by extensive IP portfolio with applications beyond cannabis. We have a great team behind us that have been instrumental in our success. We are in the process of throwing new business verticals and improving the overall cost structure and the industry, as we all know, has significant momentum which we intend to capitalize on.

But before we get into that, let me introduce myself for those of you who don’t know me. My name is Daniel Yazbeck and I’m the Founder & CEO of the company. My background is in product and pharmaceutical development and commercialization with Pfizer and Panasonic and MyDx represents through the combination of those experiences for me.

Let’s get into MyDx. 2016 was a great year for us, we became a top-rated iPhone app. We developed a significant database of chemical compositions and user behavior. We sold over 2,000 units of our CannaDx handheld cannabis analyzer. We diversified our company and launched AquaDx and OrganaDx, which test for impurities and toxic chemicals in water and organic materials respectively and our stock is now one of the top-traded cannabis stocks in the space and we settled over $1.5 million in convertible debt on our balance sheet in 2016.

We have an extensive social media presence which created brand awareness for MyDx products, which is pretty amazing considering our marketing has primarily been through word of mouth, as well as bring covered by the major national media outlets organically. We will continue to build out our social media presence in order to communicate the company’s vision and our brand value proposition.

Now all this has culminated into strong top line growth for MyDx and we intend to keep that momentum heading into 2017. Total revenue rose 74% in the fourth quarter and 111% year-over-year, primarily driven by CannaDx sales. Now although we’re showing earnings growth, it’s really important to note that we are still a startup tech company focused on building a business, which costs money. And while we intend to manage our cost effectively, we also intend to allocate funds necessary to strengthen and grow the business.

Now unlike any of the startups that have the luxury of starting their business in the private market, we have to manage our business publicly quarter-to-quarter so you guys get to see firsthand the struggles and successes so far on successes which is good of building a tech company from the ground up and we could have been more proud about what we’ve been able to accomplish in a relatively short amount of time.

And our company is global, I mean outside the U.S. our products are sold in Canada, Spain, Switzerland, the U.K. and the Netherlands to name a few and going forward though, we intend to focus our efforts on North America, that’s U.S. and Canada since that’s where the majority of our sales are.

However, all this doesn’t mean anything unless you compare us to other companies in this space. And while there is no direct competitor for MyDx, we wanted to compare ourselves to MassRoots, one of the leading tech companies in cannabis and one which I and we respect tremendously, to demonstrate that our stock is undervalued despite relatively strong financial and business metrics.

Both MassRoots and MyDx were found at the same year, 2013. However, our 2016 sales beat MassRoots by over 100,000. We have a better margin profile which is something considering we manufacture and distribute our own products, not just a website or an Apple advertisement which indicates very efficient at managing our costs.

Our business model is also less risky given we have the ability to generate a revenue in a number of ways, which we’ll get into later in this presentation. We also have products outside the cannabis industry and we have IP protection in the form 30 plus tax.

Lastly, when you break down our per revenue per user, we’re doing much better than MassRoots there as well. Unfortunately all this hasn’t translated into market value that we hope to clear that out in this presentation. We believe we are significant undervalued given our business metrics.

But we couldn’t have been here – we couldn’t have gotten here without the MyDx team, as well as other – so let’s take a moment to acknowledge them. So Rob Vigil is our lead software developer. He is instrumental in the development and deployment of the MyDx app and it’s really nice product. Feel free to download; it’s free from the App Store.

Nicholas Hadler is a man of many hats and he takes on what is needed to get the job done operationally. And with the lean crew that we have right now, his presence has been invaluable. Lastly, I want to acknowledge Joshua Londono who currently manages R&D process which brings you the products that you love.

And it’s really because of these guys as well as others that we’ve been able to execute on our plan over the last four years. So like I said earlier, we established the business in 2013, we developed our core products in 2014, we started selling in 2015 and we focused on growth in 2016.

And we are really known for our CannaDx sensor which tests your cannabis samples and gives you a Total Canna Profile which is a more complete profile of your cannabis to include both cannabinoids such as THC and CBD, as well as the most prevalent terpenes. It also provides you with how the samples should make me feel given the Total Canna Profile. Our admin allows you to track your usage and also provides you with strain recommendations, given the various inputs such as feelings you want help or ailments that you want a relief.

And of course that was the initial value proposition for us and why is it important? Well, let’s take for instance, Blue Dream. Blue Dream is one of the leading strains or strain names sold in California. Yet, if you were to lookup what Blue Dream was made out of, you wouldn’t get a uniform answer. In fact social networking sites devoted to cannabis can’t even seem to agree on the exact definition or chemical profile of Blue Dream. So let’s dive into this a little bit more and see what MyDx says.

So according to our data, if you didn’t test your cannabis using MyDx, you would have no idea what you are buying. In three random samples tested, only one came back with something close to the definition provided for Blue Dream.

In the first sample, you know this is a Blue Dream because Blue Dream is associated with a higher THC content. In the second sample, the higher THC exists, but little or no other cannabinoids and the terpene profile is non-existent with the exception of a high prevalence of Terpanine and you know what, I don’t think anybody knows the Terpanine names or how it’s supposed to make you feel. So why bother with all this uncertainty, get what you need, when you need it, conform and track results using MyDx. And that’s an important distinction between MyDx and other companies.

While companies talk about data and analytics, as it’s early on in the year, you really don’t know what you have until you start mining that data for insights and what we discovered created a whole new revenue model for us. We captured all sorts of data, user data, user feedback, usage behavior and chemical composition. And we put that through our proprietary algorithms to provide unique insights, especially into what people are using and why and how they are using it, which from a data perspective makes us very unique in the industry. No one has the type and sophistication of the data we poses and we intend to use it to create additional products.

For instance, we now have chemical profiles types of feelings and or ailment relief, then we can begin to test in clinical trials to develop pharmaceuticals and or work with third parties to develop consumer products. We can even develop those products ourselves should we decided to do so.

And just to give you another glimpse of what our data showed so far, these are the top 10 therapies our community is reporting on. Pain, is overwhelmingly the number one symptom people are seeking to relief. However, as that pain becomes more nuance in the form of migraines, what work for generally doesn’t necessarily translate into more acute relief and we see that in pain pills how the variation of those product can address the different types of pain and cannabis is no different in that regard.

Another cool thing we found was that the more common reviews, the less engagement we saw from our users’ means people generally had already figured what to use for their pain. And so we’re less likely to share that information with the community and the other members suffering from pain.

However, with less common uses, we saw community of users much more engaged with one another to help find remedies for those ailments. Mind you, we’re seeing this data play for an extent and so when I say, we have no – when I say, we have data no one else has, we really do have data that nobody else has. And it’s because of this data that we have gone from essentially a single product company to a company with potentially – the potential to offer many different types of products and services.

It’s going to this. In fact, that’s exactly what we’re doing right now. Our focus in the future is going to be on four business segments at MyDx. One is the consumer products division, which brings you know like the MyDx analyzer and will bring you other consumer electronic products, as well as consumables. The data analytics division, which will focus on clinical chemical analysis and our patient feedback ecosystem.

The biopharmaceuticals division, which will start looking at Active Pharmaceutical Ingredients, and what I’d like to call, green Active Pharmaceutical Ingredients those coming from Canna [ph] And then how the green Active Pharmaceutical Ingredients assist in pain relief or symptom relief.

Lastly, our Software segment will be focused on software-as-a-service and we’re going to be able to provide software for the strivers, patients, groups, and cultivators and regulators and we’ll get into that in sometime. So as we expand, when you think of a company from that perspective expanding these other segments, obviously, this opens up the competitor universe and when you compare us to other pharmaceutical companies in the space, we also compare favorably with the exception of our market cap, which again we believe this is extremely undervalued.

By the way, we also sell other products that are currently solving real-world problems outside the cannabis industry; OrganaDx, AquaDx, AeroDx, as well as our CannaDx and we’re going to touch on just two of these here. While the OrganaDx sensor can be used for pesticides in foods, vegetables, and organics, it can also test for them in your cannabis. And this is very important considering the lack of regulatory insight in the cannabis industry and the potential for harm, consider the top right excerpts from a Business Insider article in December 2016.

50% of the samples that tested positive for pesticides, in that positive for myclobutanil, which is an illegal pesticide to use on cannabis, because when you heat it, it turns into hydrogen cyanide, which is a poison that can kill you. This is even more concerning when you think about the impact this can have on people with debilitative immune systems due to HIV or cancer. So that people who need cannabis the most can in some cases be hurt by it the most, and that’s simply unacceptable.

In the bottom left corner, NBC News went to various dispensaries in California and requested pesticides-free cans. They tested 44 samples and found that 41 of them, that’s 93% not only tested positive for pesticides, but tested positive at levels that would have been banned in other states. There exists a lack of transparency in the cannabis industry, and MyDx is there to alleviate that problem for the benefit of the general public.

The lack of transparency doesn’t only exist in cannabis, but also in the drinking water. In fact, according to The Washington Post, the full scope of less contamination in public drinking water may be impossible to determine. In a separate study, USA TODAY found that it’s quite common for lead in our drinking water to be at levels higher than acceptable. While this is bad for everyone, it’s especially disastrous for argue.

Studies have shown that when our children are exposed to higher levels of lead, while their bodies are growing, this leads to lower IQ levels, kidney problems, muscle atrophy, amongst other ailments. We should not leave it to chance. We need to keep our children safe and demand a change in our environment if our environment is not the standard, especially when the role of the EPA moving forward is a little bit uncertain. MyDx enables socially conscious consumers to bring about transparency in our national waterworks and we couldn’t be more proud to provide to that.

Now, I know that’s a lot to show on. But these opportunities are quite actionable and we intend to seek additional financing to execute on these objectives. We’re now actively meeting with institutional investors, private funds, and investment bankers fix more financing alternatives outside a convertible debt and are contemplating the following structures for retails and institutional shareholders long-term only institutional investors, and strategic partners, which we have a minority stake in our business.

Finally, these are the reconciliation from GAAP to non-GAAP numbers, we review this and you’ll be able to see this in our follow-up with our 10-K as well.

And at this time, I’m going to end the formal presentation, and we’re going to open up for Q&A. We’re going to have time to get everyone’s question in, but in the case we do not, we’ll follow-up at some other time. I’m going to give everybody a few minutes here to submit their questions. I see some of you have already submitted that. So we’ll try to get them as soon as possible. I’m going to read the name of the person asking the question and then I’m going to provide the answer.

Daniel Yazbeck

So the first question, which we addressed at the beginning is, one moment, why hasn’t the 10-K been filed, by Alan Brochstein; a surprising question from you Alan. So, as I said at the beginning, our 10-K has not been filed, because our auditors have been extremely diligent and they’re just being extremely conservative in the requests, which is fine and we’re providing all the information. We believe this to be filed very soon and everybody will have a chance to read it and review the numbers that we’ve submitted.

How do you maximize the Canada opportunity?

That’s a good question. I mean, we are focused now on the United States and Canada, and I actually grew up in Canada, in Montreal when I was in McGill University. So but we have – channel partners will be working within hand, as well as general marketing activities that’s going to take place in the U.S. and Canada. Canada is an open opportunity. We are looking at area – ways to get involved there. So stay tuned for more information. But as it’s one of our focus areas in 2017, Canada and United States, that’s where we are going to be focused.

Will you cancel the reverse split? This is by Mathew Wood. The question for Canada was Christopher Danko. Matthew would ask, will you cancel the share reverse split? This will entice the investors to come and stay, people are too nervous with that room, good question Matthew.

When we announced the reverse split, we announced that early in the year and we outlined in the shareholder letter exactly what we wanted to do and why we were pursuing that, mainly the reason was to attract institutional investors who would – are not able to invest in stocks that are priced this low.

That said, what we’ve seen and with the reaction from our market is that, we have a fairly robust market with a liquidity in this market at this price point. At this time, I don’t see a need for the reverse split, but we maintain the right to do that, of course, should the right institutional investors come on board. But at this time, I don’t see a need to do the reverse split.

Next question is what is the impact on Rhode Island’s medical cannabis market from Joe Andreozzi.

Joe, I’m going to need more information there. I’m not very familiar with Rhode Island medical cannabis market. So I’ll have to get back to you on that. Joe has another one, how it’s ready [ph] to manipulate? Joe, you get some technical questions there and see here.

We’ve been sold under the brand name, which doesn’t use a product like yours, they’re less likely to have a reliable genotype expression on a consistent basis. So, Joe, and you’re touching on this, what is in a Blue Dream and it comes back to genetics and can people identify the right strain?

I mean, the bottom line is, we have every intent to provide technologies that will help in public safety and transparency. So – and brand protection, somebody selling a Blue Dream, which is truly a Blue Dream, you won’t be able to identify that. So you want to be able to protect your brand. You want to be able to protect the feeling and ailment that’s associated with the brand. So this is definitely important for us.

We are looking at this. We are not really involved in the genetic aspect of this at this time. We’re looking at the downstream, in the end for me what matters is, what is the resulting chemical profile of cannabis and how does it make somebody feel, wanted to help them relieve, I take that data, we mine it. We generate a formulation that can be put into – can be – we can push that to pharma, where we can act as a preclinical source of data. We can push that to pain manufacturers who want to sell vaporizer pens for example, and put a formulation for sleep, or put a formulation for relieving this ailment or this ailment and I feel point faction.

So we’re – our data helps us leading to a hybrid between the pharmaceutical industry and the nutraceutical industry and Cannabis really falls in the middle of that, which makes it such an exciting space to be in. So, Joseph Jacob, when is 10-K going to release, we covered that. Why every time releasing 10-K late? It’s on us, I mean it’s – if we – we owe everybody at 10-K, we’re going to get that 10-K we have to wait for the order of consent, it’s just the way this process works.

We have put out the guidance through our financials and we’re very confident about the numbers. And we believe at any moment you should be seeing that 10-K. We apologize for the delay and it will come and you are right, I mean this is on us, we’ve got to make sure this thing gets filed on time every time. And it’s a combination of working with the right attorney teams and the order is to make sure that they get them fast and it’s prioritization, so we – this is on us, we’ll take this hit and we’re going to continue to move forward and give you these Ks on time in the future, so please stay with us.

What benefit did MyDx get for the 1.5 million converted free trading shares diluting to 1.5 billion, what resulted from this supposed Chinese extension. So Jacob, who has asked the question. So we took on a lot of convertible debt last year to finance the operation. We hadn’t built the market at that time for out stock was difficult to get people to understand what the base was. We now have a little bit more robust middle market.

So, sometimes companies that do a reverse merger and it’s interesting that they get into a situation where the funding they have leads them to money of last resort, because they haven’t built the market and a base and a floor for their stock at that time. So maybe they are having to resort the convertible debt to continue to finance and move the company forward.

That convertible debt has helped us move the company forward, get to this point and make sure that we’re able to develop the data analytics that we have, develop the business model, continue to sell MyDx devices and continue to penetrate the market. But it’s not the type of financing we’re interested in pursuing in the future. We want fixed equity financing. We want to be able to raise long-term capital from long-term investors, this is where our focus is. And so we’re getting away from the convertible debt world.

Joe, there is a MyDx app we’re working with Terranomics [ph]. And Joe, maybe we can talk offline, send me an email if you have any interesting options there, I think it’s too technical for the crown. The delay in the 10-K, Jacob already we covered that. Tony Brad [ph], would you please expand on MyDx IP protection, are you actively developing original IP and do you find future proof IP protection in your exclusive licenses if better sensors are developed by your partners.

So good question Tony, I mean we have very strong IP protection. We have over 30 license patents, so we have an exclusive license to leverage this NASA based technology that we use which is electronic nose that was used by the NASA space shuttle to take gases for Astronauts. We simply exclusively licensed it for the cannabis vertical on cannabis Industry. So we have over 30 patents, you can find them on our website and you’ll see them in our 10-K. We’re also developing our own IP round that IP so we can expand the ability to – it’s not just electronic nose technology that we cover the IP, we cover the IP where you detect chemicals and salts, liquids and gases, not just gases, because getting out, we licensed gas sensors, so that’s the first part.

We have our own IP that’s going to be developed when it comes to our data or data analytics, as well as the formulations we’re going to be developing. So we will be providing exclusive licenses to our data. And data to select partners in the space that can help us deploy in the nutraceutical and then eventually the pharmaceutical world. So we’re very excited about the IP. We do have – it’s very difficult apart from the hardware that’s difficult to produce with the low noise that we have and the software and then the data that we have as well as the IP, we have pretty good IP protection and we will penetrate this space and finally generate the type of data we generate with the consumer feedback that we have is going to be difficult, it’s going to take them a few years to do so.

And why is there nearly no support via contract formula or smart bits, I don’t understand the question. Why is there nearly no support via contract formula, has anyone asked again Michael I’m not sure what that means. How do you plan to format market and monetize the data?

So, a good question Ricardo. I already said the data is going to feed our verticals, so we have – the initial data will be used to – and we’re doing that right now. What we have now generated formulations, basically I want to know this much CHC, this much CVD, this much CVM, this much of this terpenes, this much of this terpene. So we’re going to have formulations that are going to be derived from the data. These formulations will then – let’s call that pre-clinical data where we have hunch that this formulation is going to impact these people’s physiology in this way.

Right, so we can then take that and now you can enter a more formal clinical study with that data, and then you can validate that this type of formulation is perfect for migraines or for pain and you’re going through a more formal pharmaceutical type of FDA study where you can do a clinical study to validate the status. We have pre-clinical data that can be used there.

On a less formal nutraceutical approach, you can work with 10 manufacturers so that they can take this data and they can put this formulation into its desired bake pan, where now you have a bake pan that has this oil formulated with MyDx formulations and then provide it to folks, so now we have basis into where this data can say this can be used to help you sleep. Or this formula can be used to make the energetic or more importantly on the – we’re really focused on the ailment side, I want to bring back my Pfizer days here at this time, I’m still very close to the company. We’d like to be able to see whether we can take this in a pharmaceutical area and this is my focus right now. But in the meantime, I understand there’s a big market on the nutraceutical side if we can get involved or should we find to in a safe way without violating any federal laws or any kind of disclosure laws then we’re going to do that.

So, Alan Rockstein asked how has the capital raising environment changed and what are your plans for 2017 in raising capital?

So a good question Alan. The capital raising environment has changed because we have a – our stock notwithstanding the effect of our convertible debt which is effectively over modestly the $35,000 left over due in May. We’re now in a much better position to raise fixed equity capital and we’re already done that and you must see that when you read our K. So what’s going to happen is as we – instead of taking convertible debt where you don’t know what the ultimate on the stock will be. Fixed equity is a much safer approach. So we’re now able to do that. Our business – we’re also maturing. So our business plan has matured, we had executed over the last four years.

Our business model has expanded into other revenue streams that we plan to capitalize on. So we’re going to be able to attract capital from many folks, we have a folks that always are focused at capital, but we don’t even responsibly for the right capital and we’ve identified some parties that we’re working with right now to do that. And we’re always looking to expand. There’s also, I mean, as you mentioned, let’s go back and touch on the slides here.

For retail institution investors, we’re looking to possibly do a fixed price valuation to our current shareholder base can buy additional shares into the company and proportionate to their existing ownership to participate in the financial upside of the company. So it’s flooring one avenue here and again that’s non-toxic.

Our long-term institutional investors, again fixed price equity financing from institutional investors and family offices, we’re actively pursuing this. And of course strategic partners that we’re looking to work with now that we have these other revenue streams. And we haven’t really, I mean if you look MyDx has done a lot and the partnerships we made it that in a way where we can get out there prove who we are, get the beta out there and now we’re in a position where we’re actively pursuing partnerships and we’re going to be hearing about that.

So Dwayne Wayne Craig [ph], do you think we’ll charge in the future to consumers that don’t have a CannaDx. I don’t understand the question Craig or Dwayne. Do you think we’ll charge in the future, maybe you can ask that again. I don’t understand the question.

I had a nice – Marcus, I had nice contact with Nick already. There’s no answer lines – Nick – Marcus, I’m not sure what the issues we have there, especially if you could have marketing you want to support us. You want to do marketing in Europe or the device is not directly available put more stuff in the company because of your customer support is outlawed.

As I’m sorry to hear Marcus, I think it’s usually on it with everybody. If you’re trying, I’m sure if you are listing in Nick, you want to reach out to the markets and make sure you address this request. But if you want to market products in Europe, Marcus, one of the things that we said, we’re focused right now on North America, it’s probably one of the reasons you haven’t had a response from Nick. But I’m sure he’s going to follow-up with you and we can go from there.

[Joe Chris] [ph] was that asks what are your marketing plans? It depends on the vertical that we’re looking at. But right now, I mean, most of our marketing has been through organic Tier 1 media, that HBO covered us in their documentary, which is very nice. CNN covered us on AquaDx, NBC covered us on OrganaDx.

So we – right now, our focus is on the cannabis industry. And we do have other lines in these other industries, which you’ve got to stay focused from what I’ve learned, and we have a lot of opportunity in the cannabis space, we’re going to focus on. We are out there. People know of MyDx within the cannabis space and we’re growing every day. So apart from word of mouth advertising and social media advertising, we never really dedicated a lot of marketing budget, because we’ve been lien and we’ll be trying to just slowing down this debt before we raise our next capital.

But we’ll get back to you on our marketing plans as those are developed. But right now strategic partners is one of the focus for us and working with the channel partners and marketing is another focus.

So, Daniel, [ph] will MyDx looking at other avenues, say, cannabis, for example, such as electric store possibly Best Buy, good question, Daniel. So on the Canada side, I don’t know we matured enough as an industry and as a signal, I mean, I know over 60% or 70% of Americans approve cannabis, but I’m just not sure of Best Buy is ready to take on a product like cannabis just yet. We hope to get there soon.

But right now, but the beauty is for OrganaDx and AquaDx and AeroDx. And as we launch MyDx 2, which is going to be more of a bench top, absolutely. We’ll be looking to Best Buy. We’ll be looking to places, such as Best Buy to display these products and getting to proper retail outlets that can really showcase our products.

Matthew, will you catalyze some issues with pesticides laced in – on lead in Canada, if so how?

It’s becoming a massive issue here, lots are becoming quite sick. And so, we do have our OrganaDx single use sensors that we’re selling on our website at this time. So feel free to visit our site and review that. The pesticide issue is very close to me. I – it bothers me, because there’s something that is unacceptable. And so we – to accelerate the deployment of a product that should help, we launched the OrganaDx single use sensors. It’s not the final product that we want, but it works. It gives you a pass or fail, whether the sample that you’re about to put in your body is safe enough to ingest. And this is for US military standards and the partners that we’re working with.

So we’re comfortable with that. It’s not a sexy, because it doesn’t have a app. It’s not digital and we’re working on that, but it works. And the bottom line is, you need a solution. We lost the solution and we’re going to be launching additional products for this, because it is near and dear to my heart.

Dwayne, will you charge in the future for the app usage of a consumer without operating a unit free data?

Okay. So good question, Dwayne, I think you called up now from your other question. So currently, the MyDx App is free. Anybody can download it from the app store, if you do so on the iOS or Android devices. We will be offering additional features in our app, which we are contemplating charging for at this time. And it will be related to data, because getting these data formulations, for example, somebody wants to reveal an ailment for pain. Right now, we send you to look strain names that you can try and find a local dispensary. But again, we just discussed that not all those do the same, and straining really is nothing and you don’t know what’s in.

So what we’d like to be able to do is give you a formula. You want to relief pain, use the formula and then we’re going to provide you with a way to go make right? So because even though the other formula of 16% THC, 2% CVD, how you’re going to go ahead and make that? I don’t know, it’s more complicated. So this is where we’re working through that, but absolutely a good question. We will be following up on that.

Tim, before asked, have you done any long-term studies on the sensors? Will the user know when they have lost accuracy?

Good question, Tim. We have done some long-term studies in the sensors. I mean, our sensors are currently warranty for six months. The – we can track – if you have a question about your sensor, we don’t have automatic software right now that says, you sensor is ready to replace. We are developing those algorithms and we’ll be deploying them.

But do you have any questions about device, do you have any questions about your sensor, please call our customer service number, we can log in and look at the sensor responses remotely through our software if you provide some information to our customer service team. And they’ll be able to troubleshoot for you what, whether you’re sensor is so punctual or not. But we ran 3,000 tests on our sensors, they work fine. They are pretty robust and that’s the beauty of this technology. But they do breakdown, it’s cannabis, it’s a complicated sticky molecule.

So just watch out for that. The past six-month mark you might want to check in with customer service and on the status of those sensors.

Could you offer guidance for sales numbers thus far this year? Unfortunately, not at this time, but we will be coming out the Q shortly, so we’ll get to that. Will MyDx consider sustain all spot price moving forward in the future?

This is something, I’m not sure, I can comment on. It’s very speculative. I don’t want to necessarily set a target. But it’s a good question. As I said, we believe we’re undervalued. If you look at our market cap or close to $20 million right now, so we think we’re under valued. Where it can go from here? We think undervalue, we’ll see what happens.

Matthew, with last question, why you release news on prior finance before closethis falls at least in this prior to open market?

Come on, Matthew, we got to – we’re just – this is not, listen, we want to release news as we get it, it’s coming before market close. I mean, if we release good news before market close, I mean, would you say no or yes to that? We release news as we get. That information I can release, can put this together, and we’ll release – we’ll then release it. We’ll take your note into consideration if you want news prior to local market, but we’ll see if we can do that more in the future. But, we’re getting this close information, as we receive it, and we just get it out there for you.

What can investors expect in the next quarter in May?

We’ll get back to you on that. This is by Nathan [ph] [indiscernible], it is a possible to use and resell if I sense to sell these units. If you do – if you aren’t, say, becoming an affiliate of our network, please reach out to customer service. Nick will work with you closely and he can sign you up our affiliate network, it’s very passive, you provide it with a coupon tracking code. So you can actually sell our product directly on yours website, wherever you are to help push the products and you’ll get a passive income with these.

And you see here, is it possible and then have you considered marketing through product test to get more awareness and see how many more questions we have well, let’s get keep going. But let’s see here. We have time we have time for more questions, [indiscernible] some more time, let’s see if we can. And you considered marketing through product test to get more awareness, it’s a good point. We will market ADN through product test. We do have a kind of insider actually is one of our top affiliates. And they are able to, so we have none of you there. And so we understand thatproduct testcan be helpful.

Are there any plans for commercials in the future to help product test sales and marketing by [Damien Hendrick] [ph]?

Once we have additional financing, we’ll be looking at those avenues, looking at the return on investment for every dollar spent. In marketing, it is an important area, it would be extremely lien right now, we’re trying to stay that way for a moment. So we can become cash flow positive. But we’re still going to grow our business, so we’re looking for additional money.

So let me see here, most [indiscernible] we’ll be marketing accessories and hydro products, Jason. I know it’s an important area. But right now consumers are important target for us and we’ve gone out there, growers is one of the bigger industry – bigger classes of consumers that we have, they test their products, and we’ll also be looking at regulars.

But you are correct, we’ll look at accessories and hydro products. I can’t comment on target valuation and reverse split just then. But feel free to review the presentation, where you can see how are undervalued compared to other companies. We’re going to say, so what do you want from range plants with other sensor technologies internationally this product thus far reaching possibilities, is it being pursued?

We have already looked at other sensor technologies for OrganaDx and AquaDx to get that out to market. So we are absolutely looking at that. There’s always new technologies coming up. We are a science and technology company that’s developed the first and health chemical analyzer for consumers. So we’re able to definitely pursue that and we’re actively always looking at that.

What are your thoughts, or did you consider combining all of your four products into one instrument? This is by Steven Cohen, old box, so all households and companies may desire one, which is a huge market, submitted by Steve.

Okay, so the initial premise of this was to do a four-in-one. We have the ability to – for example, the AeroDx sensor, we can – we’ve developed this. We tested it within the existing test or beta version within the existing unit, you all are holding in your hands. And so we do have the ability to do this, but we are mainly looking at doing that from MyDx 2, where we combine Organa and Aero into MyDx suite, as well as to give some data analytics capabilities for CannaDx.

What impact have you seen on your end by being featured on HBO?

The HBO feature was very natural, very excited about that Evan, and we’ve seen more exposure. I mean, these guys have – the producer just sent me an e-mail, they posted it on – for 20 week, it’s just more exposure, more branding, let’s go out and start up and we are going to pursue it. So okay, so let’ me see if we can thrust with this. But you want one or two more questions here.

The expected sales for the quarter, we can see – well, the OrganaDx new model test for VOC is left by extractions. It’s a good question Jason Lloyd, how about the single use kits?

So you are looking at VOCs left by check and residual solvents from some of the stress cannabis or oil from cannabis flower, we use solvents and what you are left with is residual solvents or VOCs. Actually our AeroDx sensor, which is a gas sensor, we got to work within the CannaDx sensor, that is now being evaluated through VOCs. And so we do have the ability, but it won’t be OrganaDx ironically, it will be AeroDx, which looks for these raw power organic chemicals that are left behind with extractions.

So, Jason, to follow-up, your shareholder letter hinted of an acquisition and you expanded on this. The question Jason, in the 10-K you will read more about this. We are looking at acquiring a specific entity that’s going to help us expand our data capabilities. I will leave it to the 10-K, so to share more information on this and stay tuned. We are going to be opportunistic with the acquisitions that we have.

Al right. So I think this will end the questions-and-answers. There I’m just going to see only one more maybe, Jason Lloyd and Steve here.

And then right now, Steve.

Where will the sensors be based and also view about, so, okay so I can’t disclose on the timing of rolling out, look, it tells about MyDx 2. Let me just finalize by talking about MyDx 2 and then we are going to wrap it up.

MyDx 2 is a – is going to be the first tablet made for kitchen tops that will have integrated functionality of OrganaDx testing what you eat for organic properties. AquaDx testing what you drink from harmful chemicals, and AeroDx, which will test what you breath and test your hair fall, as well as CannaDx integrated functionality.

We like this product very much more and make sure that it’s a perfect product before we put it out there. I think we are very excited about this, but again our focus which we aren’t thinking is moving on this as we deploy the cannabis, but – additional verticals. But right now from all of our products in housing and what we are looking to expand on, we are very excited and we hope everybody that can stay tuned and watch our progress and we look forward to deploying all these products in the near future.

So thank you very much everyone for joining the call. We’ll look forward to doing this again in the future and have a good day.

Question-and-Answer Session

Q -

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