Cytosorbents Corp (CTSO) CEO Phillip Chan Q3 2017 Results - Earnings Call Transcript

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About: Cytosorbents Corp (CTSO)
by: SA Transcripts

Cytosorbents Corp (NASDAQ:CTSO) Q3 2017 Earnings Call November 9, 2017 4:45 PM ET

Executives

Monique Kahf - Investor Relations

Phillip Chan - Chief Executive Officer and President

Kathleen Bloch - Chief Financial Officer

Chris Cramer - VP of Business Development

Vincent Capponi - Chief Operating Officer

Analysts

Joshua Jennings - Cowen

Andrew D’Silva - B. Riley FBR Inc

Sean Lee - H.C. Wainwright

Joanne Lee - Maxim Group

Brian Marckx - Zacks Investment Research

Operator

Good day everyone and welcome to the CytoSorbents Third Quarter 2017 Earnings Conference Call. At this time, all participants are in a listen-only mode. Following the formal remarks, we will being the call – we will open the call for your questions. Please be advised that the call will be recorded as the Company's request.

At this time, I'd like to turn the call over to our moderator, Monique Kahf. Please go ahead.

Monique Kahf

Thank you and good afternoon. Welcome to CytoSorbents third quarter 2017 operating and financial results conference call. Joining me today from the Company are Dr. Phillip Chan, Chief Executive Officer and President; Kathleen Bloch, Chief Financial Officer; Vincent Capponi, Chief Operating Officer; Dr. Eric Mortensen, Chief Medical Officer; Dr. Christian Steiner, VP of Sales and Marketing and Chris Cramer, VP of Business Development.

I'd like to remind listeners that during the call, management's prepared remarks may contain forward-looking statements which are subject to risks and uncertainties. Management may make additional forward-looking statements in response to your questions today. Therefore, the Company claims protection under Safe Harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from results discussed today. And therefore, we refer you to a more detailed discussion of these risks and uncertainties in the Company's filings with the SEC.

Any projections as to the Company's future performance represented by management include estimates today as of November 9, 2017, and we assume no obligation to update these projections in the future as market conditions change. During today's call, we will have an overview presentation covering the financial and operating highlights for second quarter by Dr. Chan and Ms. Bloch. Following that presentation, we will open the line to your questions during the live Q&A session with the rest of the management team.

At this time, it's now my pleasure to turn the call over to Dr. Phillip Chan.

Phillip Chan

Thank you very much Monique, and good afternoon everyone. We are pleased to report record total revenue in the quarter of $3.8 million with $3.4 million in CytoSorb sales to the strong reorder rates with product gross margins of 69%.

During the quarter, we achieved a total accumulative number of CytoSorb treatments of 31,000 treatments delivered, up from 17,000 a year ago. And looking forward to 2018, we see numerous revenue catalysts coming online. Including Fresenius co-marketing agreement with us had now begun in five countries and is expected to roll out to all 44 of our countries where possible as we gain more experience with this co-marketing effort. This difference from the six countries where Fresenius has been already selling CytoSorb and where they have exclusive distribution rates.

In addition, we are benefiting from the new reimbursement in Germany for CytoSorb and we are already seeing the positive impact of that on our direct sales. During the quarter we also launched our CytoSorb therapeutic ECMO kit which is designed to accelerate the use of CytoSorb in the application of Extracorporeal Membrane Oxygenation where we have already logged in more than a thousand treatments to date.

In addition there has been a lot of new published and pending data out there, including studies published [inaudible] refractory shock, endocarditis, our CytoSorb registry analysis. There are also pending publications in the area of meningitis. The first case report in the use of CytoSorb in the treatment of acute exaggerations of autoimmune diseases like multiple sclerosis. There is also a paper pending on H1N1 influenza in the use of CytoSorb for the treatment of flu, and this is particularly timely and relevant given that we’re entering into a new flu season.

And also we reported our new animal data on survival following traumatic brain injury and hemorrhagic shock to the major ways people die following a traumatic injury.

In addition, we announced that we have had a lot of different initiatives in terms of driving new innovation. We were awarded $1.7 million in grants and contracts to develop new polymers for the development of universal plasma for the blood transfusion industry and also new polymers for the treatment of severe burn injury.

During the quarter we also entered into a co-development deal with Aferetica for ex vivo solid organ rehabilitation, where we are looking to take substandard organs that are designed for organ transplant but because of their poor status or typically discarded and helping rehabilitate them in an ex vivo perfusion system using our sorbents to be able to get them back up to speed so that they can be implanted and placed into new host recipients.

In addition, there have been some new developments in the CAR-T Cell immunotherapy space with the approval of Kymriah by Novartis and Yescarta from Kite Pharma now owned by Gilead, which should paved away for European approval, and therefore usage of CytoSorb to treat cytokine release syndrome in Europe and potential future usage of CytoSorb to treat cytokine release syndrome in the United States.

As an update to REFRESH 2, we met with the FDA and are in collaborative discussions with them, designed to drive final IDE application approval. The current trial remains focused on high risk valve replacement patients. And once we finalize our discussions with the FDA, we plan to have an update on the final design in the near future. And pending those FDA discussions, we anticipate the start of REFRESH 2 this quarter.

A quarter later [ph] to the REFRESH 2 trial is a particular subgroup of valve replacement patients caused by infective endocarditis. The effective endocarditis is a bacterial infection of the heart valve that occurs when bacteria seeds the heart valve. This can happen from a dental procedure and people with a heart [inaudible] typically are often advised to take prophylactic antibiotics before a dental procedure to prevent bacteria from colonizing the heart valve. But one of the things that is driving this – the incidents of endocarditis is the opioid epidemic and the use of heroin and dirty needles that wind up leading to very severe infections of heart valves with very deadly skin bacteria.

The problem with these types of infections are that they can rapidly destroy the heart valve within these, leading to a patient who is not only very sick from the infection and who has sepsis but also patient whose heart valve is destroyed and which puts them into a state of a heart failure, leading to a very unstable patient. These patients are often very difficult to manage both intraoperatively and postoperatively because of their instability. They typically require [inaudible] pressures during the surgery and then [inaudible] pressures in mechanical support following the surgery, and typically have poor outcomes including a very high mortality.

Well recent, Professor Karl Trager and his colleagues at the University of Ulm published the largest CytoSorb endocarditis case series published to date. This was the study that involved 39 patients where CytoSorb was used during their valve replacement surgery. And all of these patients were very sick going into the surgery, they required emergent or urgent surgical valve replacement. And based upon their Euro II score they had a very high predicted mortality for cardiac surgery.

So what was very interesting about this particular subset of valve replacement patients is that, when it was compared to a comparable historical control where they do not use CytoSorb and this was a study that was just recently published by a Patrat-Delon in – based out of a study in a large endocarditis study in France. When you look at the Euro II score which is a predictive algorithm for looking at mortality of patients undergoing cardiac surgery. They found that if those with the Euroscore less than 40 – 40 is – anything above 40 is extremely deadly. But even a Euroscore of 20 to 40 is also very deadly. But those with the Euroscore less than two, Euroscore II less than 40 and the Trager study they had a mortality of that 7% versus in the Patrat-Delon study where they did not use CytoSorb, they had a mortality of that 18%, so more than double the mortality.

But very interestingly when you look at the Euro II score in the range of 20 to 40 where these patients have a very high risk of death. The risk of death in the Trager study was about 17% versus the observed mortality in the Patrat-Delon study when no CytoSorb was used of about 42%.

So this is – this study represents just another subset of valve replacement patients where CytoSorb appears to be having a very important impact and in area of where we expect to study this population in the future outside of the REFRESH 2 study.

On the next slide, we’re also very pleased to have reported a broader industry accolades for our company. So, during the third quarter we announced that we had won the 2017 Global Frost & Sullivan Product Leadership Award in Blood Purification. And based on the pressure release in Frost & Sullivan had issued, they said, “There were many factors that led to our selection of CytoSorb for this year’s Global Product Leadership Award,” said Frost & Sullivan Research Analyst Aish Vivek. “Among the most important was the recognition that this innovative product is surprisingly well-positioned to help solve two long-standing, difficult, and tightly linked fundamental problems with hospital medicine today. These include the high rates of death from common critical illnesses such as sepsis that have no approved treatment, and the resulting staggering costs and losses in critical care that are financially crippling hospital networks and healthcare systems throughout the world.”

We’re also pleased to just today announce the fact that we had been listed to the 2017 Deloitte Technology Fast 500 as one of the fastest growing companies in North America. We logged in 293% revenue growth during the periods of 2013 to 2016. And in the Fast 500, we ranked 7th out of a total of 21 medical device companies in the Fast 500 in terms of growth. We also ranked 297th out of 500 companies in any industry overall.

So, we’re very pleased that we’ve been rising – that our profile has been rising in the broader community. And we hope that more such accolades will be forthcoming.

So with that, let me hand it over to Kathy who will talk about the financial highlights for the quarter. Kathy?

Kathleen Bloch

Thanks, Phil, and good afternoon, everyone. For today's call, I will provide an update regarding our third quarter 2017 financial results, product sales progress and also an update around our working capital and cash runway.

The total revenues which includes product sales and grant revenue were approximately $3.8 million for the third quarter of 2017 as compared to approximately $2.4 million for the third quarter of 2016, which is an increase of approximately 59%. CytoSorb product sales for Q3 2017 were approximately $3.4 million which is our best quarterly product sales ever. This represents a 61% increase over the product sales of approximately $2.1 million for Q3 2016.

Our Q3 2017 annualized product sales run rate rose to $13.8 million compared to an annualized run rate of approximately $8.6 million one-year ago. Q3 2017 gross margins rose to approximately $2.3 million, an increase of approximately $860,000 as compared to gross margins of approximately $1.4 million for Q3 2016. And gross profit margins on product sales were approximately 69% in Q3 2017 as compared to 68% for Q3 2016, primarily as a result of the mix of direct and distributor sales.

Turning to our nine months financial results, total revenues were approximately $10.5 million for the nine months – first nine months of 2017 as compared to $6.4 million for the same period in 2016, which is an increase of approximately 63%. CytoSorb product sales for the first nine months of 2017 were approximately $9.1 million, which is a 62% increase over product sales of $5.6 million for the first nine months of 2016. And our grant revenue grew 67% from $850,000 for the first nine months of 2016 to $1.4 million for the first nine months of 2017, largely as a result of revenue from new grants.

Next, we’ll take a quick look at our quarter-over-quarter product sales. Q3 2017 sales of $3.4 million were significantly higher than Q2 sales of $3 million that's a 13% quarter-over-quarter increase in sales, and sales growth pace remains very strong.

Next, taking a look at our trailing 12 months product sales chart. We believe this chart best demonstrates the increasing trajectory we are experiencing with regard to our product sales. Our trailing 12 months product sales have climbed to $11.7 million for the 12 months ended September 30, 2017, as compared to $7.1 million for the 12 months ended September 30, 2016, an increase of 65%. Phil has already discussed, numerous catalysts which are expected to continue to fuel sales growth in the future.

Now with regards to working capital, as of September 30, 2017 we had approximately $15.4 million in cash and short-term investments. This includes the net proceeds of the $10.3 million received from our April 2017 equity financing and additional $5 million received in June 2017 as a result of drawing down the second tranche of our debt facility with Bridge Bank. And an additional $1.5 million of cash from the sale of common stock using our at-the-market controlled equity offering during September 2017. And another $1.1 million in at-the-market equity sales occurred after September 30, 2017. And we’re pleased to report that we believe this will provide sufficient funding to support our operations into 2019.

Turning to our capital structure, as of September 30, 2017, we have approximately $33.4 million common shares on a fully diluted basis.

And now for some guidance. We’ve not historically provided guidance on quarterly results until the quarter has officially been completed. But we do continue to guide that second half 2017 sales will exceed first half 2017 sales. Also, in light of the numerous catalysts expected to fuel growth in the future, we remain extremely confident that we will reach operating breakeven which excludes non-cash expenditures and excludes the cost associated with clinical trials in 2018.

And finally, we expect that our new manufacturing facility will become operational during the first quarter of 2018, and with the ability to produce larger batches, we can expect to see further improvements in product gross margins during 2018 as well.

And now, I’d like to turn the call back to Phil. Phil?

Phillip Chan

Thanks, Kathy. That ends our formal presentation. I would now like to open up the call for Q&A. Operator?

Question-and-Answer Session

Operator

Thank you. [Operator Instructions] We’ll take our first question today from Josh Jennings with Cowen.

Joshua Jennings

Hi, good evening. Thanks and congratulations on the record product revenue quarter. Hi Phil.

Phillip Chan

Thanks very much.

Joshua Jennings

I understand you guys aren’t giving formal update on guidance and then if you want to stay high level but I – second half product sales being high than the first half kind of gives a really low number for Q4 potentially just to see the – for second half over first half improvement. I just wanted to just ask a high level question about fourth quarter and with all the momentum, is there anything we should be thinking about in terms of our forecast why the fourth quarter shouldn’t be at 3Q levels from a product revenue standpoint or even sequentially higher?

Phillip Chan

No, I think those guidance has been consistent with the guidance that we’ve given in the past. I think that what – you can see clearly from the quarterly revenue growth that the momentum continues to proceed. And so we don’t see anything in the near term that could potentially affect that but that would be a change from our historical guidance practices, so, we’re not offering more than that. But I think that investors should be comfortable that the business is proceeding as we have planned, and that not only do we anticipate this year to be a strong year but 2018 should be a very strong year as well.

Joshua Jennings

Excellent, and thanks for that extra commentary. I also just wanted to check, I mean you had a such strong product revenue quarter. I wanted to hear about any details, you had some tailwind in Germany with reimbursement, and I think German revenues have accounted for around 60% of total product sales over the last number of quarters but you also, it sounds like you had a pickup on the distributor side as well. Any further color in terms of the proportion of sales in Germany and also the incremental success you’re having on the distributor side of the business?

Phillip Chan

Yeah, I think what we said before is that Germany has benefited in a number of different ways, not only is it a country that we initially began selling in, so it has about a year or more in terms of selling effort than most of our other countries. And so, but this is a country where we have a tremendous amount of key opinion leader support, a very strong medical society support, this is where we have our dedicated sales force where now we have dedicated reimbursement that in some cases is twice what hospitals were getting previously for CytoSorb.

And so it remains a very strong country and with a lot of good momentum where again in most of the major public hospitals and university hospitals and a lot of the mid-tier hospitals as well and new accounts continue to the grow in the country but our sales are – in the country are dominated by reorders. And I think that’s very important because it basically demonstrates that the device is being used again and again by clinicians where they’ve had success.

So, Germany for sure will continue to represent more than half of our revenue going forward but what we do is a lot of strength in a number of different countries and from different strategic partners where we can see that there is momentum – there is a momentum in sales, in different areas and we expect that to continue. I think that we have some more work to do in terms of continuing to ensure that our international distribution runs the same path as our direct sales revenue history, but we are actively focused on that and look forward to that being a bigger driver of our sales growth in the future.

Operator

And we’ll take our next question from Andrew D’Silva with B. Riley FBR Inc.

Andrew D’Silva

Hey guys, thank you very much for taking my question. I have just a couple here. As far as REFRESH 2 goes, I know that you said that you met with the FDA. Are you getting any sort of sense on what the endpoints could be, are they going to be more clinical in nature or do you think they could be fairly similar to what a REFRESH 1 is looking for?

Phillip Chan

Yeah, thanks Andy. Yeah, I think that the – our goal is to make sure that we do a trial where it is technical feasible but it also results in clinical – it also results in a primary endpoint that can be used to help drive adoption in sales of CytoSorb in that market but also drive reimbursement as well. So there is a little bit of a play for what that endpoint should look like. I think that as a large pivotal registration trial, I think our focus is on trying to demonstrate clinical benefit of the device, and I think that will although harder to show than a strict took indication like a reduction in free hemoglobin that we focused on in the first study, I think that it will pay off in terms of the post market usage of CytoSorb.

So, the actual primary endpoints we’ll discuss once we finalize them with the FDA.

Andrew D’Silva

Understandable, I was just trying to get a sense of where it was leaning at this point. And then I guess my last question is regarding Fresenius, the joint partnership I believe it was suppose to rollout right now essentially. Has that happened yet? And then if it has, is there any sort of data points that you can point to and how it’s going so far?

Phillip Chan

Yeah, I would say that it just rolled out. Even as of a few weeks ago, we were still putting the final touches on, a lot of the preparation for doing this but we’ve now are – having been rolling this out to five countries now. And again as I mentioned in my prepared remarks, that these are countries that differ from the six countries which were France, Poland, Denmark, Finland, Norway and Sweden that that Fresenius already has exclusive distribution rights to and has been selling for more than a year.

And so these are new countries, these are countries where we are either a direct territories or where we have – we’re selling with other strategic partners or independent distributors. And I think the concept here is, let’s work out all the bugs in these first five countries and then roll this out more broadly.

Chris Cramer is on the line, Chris, did you have some additional commentary on that?

Chris Cramer

Sure, thanks Phil. Hi, Andy. I think Phil had [inaudible] in the head here that we can now see that the co-marketing activities have officially commenced. And as a data point what I point to is that joint – joint physician marketing activities are happening this quarter in those five countries where either our direct sales team or our distributors will be working with the FMC Global in country sales counterparts, and this will be to introduce our products and get it into or at least start talk to these FMC accounts that we might not have relationships right now.

I think the other thing that Phil had mentioned is that, we’ll be monitoring these initial countries in the roll out of this co-marketing program very closely just to make sure that we can smooth out any issues or complications. And then we’re anticipating a smooth roll out, there is nothing that we’re concerned about right now, so I think what we’re looking at is to scale it up and roll it out to the remainder of those countries starting sometime in the first half of next year.

Operator

And we’ll take our next question from Sean Lee with H.C. Wainwright.

Sean Lee

Good afternoon guys, congratulations on a great quarter.

Phillip Chan

Thank you.

Sean Lee

I just seem that your gross margins have been improving steadily over the last couple of quarters. Could you give us a bit more color on the pushes and pulls on that?

Phillip Chan

Sure. Kathy would you want to take that, and then Vince maybe if you could add some color?

Kathleen Bloch

Yeah. So you know, the gross margins move about a little bit and really what has been driving that so far is just the mix of distributor and direct sales. And we’re – this past quarter we were at 69% and so that was, that was very good, but it’s not as a result of any reductions in our standard costs so far. We’re still operating at the existing plan. What we do see going forward Sean, is real measurable improvements to those gross margins, especially once our new plant – our new manufacturing plan starts up which is expected to occur in the first quarter of Q1, and then I think very early in 2018 we’ll start to begin to see blended gross margins in the 70s and then growing from there.

Sean Lee

Great. In terms of capacity, how much is the new plan is going to help you guys?

Phillip Chan

Vince, do you want to take that?

Vincent Capponi

Sure, Sean. The plant is going to be capable of taking this well through the breakeven number that operating cash flow breakeven. I mean right now with the first pace we’ll be able to do about $35 million worth of business out of it. And then we have the ability to do personal expansion on a plan that could take us up to roughly $70 million in sales out of this, the current facility they were in. We’re about 80% complete right now in the expansion and we’ve already notified our regulatory authorities about the expansion of putting everything in place to bring the plan on for the first half of 2018.

Sean Lee

Okay, that’s great, thank you. That’s all I have, thank you again for taking my question.

Phillip Chan

Thank you, Sean.

Operator

[Operator Instructions] We’ll take our next question from Joanne Lee with Maxim Group.

Joanne Lee

Hi. Hey guys, this is Joanne Lee speaking for Jason Kolbert for Maxim Group. So the first question he had was relate to the upcoming REFRESH 2. Could you walk us through what the trial design might look like based on the data reported in REFRESH 1 demonstrating increasing reduction in plasma free hemoglobin over several hours? What do regular is considered to be a clinical meaningful reduction and over what period of time that is the trial approval?

Phillip Chan

Yeah, I think that in the previous Q&A I had mentioned that we would be looking at clinical outcomes, improvement in clinical outcomes. And there is clinical outcomes could include a wide variety of different measures of organ function, kidney injuries is a major organ that gets hit by a complex cardiac surgery that failure to lean off the ventilator, the need for [inaudible] pressures and hemodynamic infidelity. These are all things that we will be looking at in a large pivotal registration study that is designed to drive U.S. approval to CytoSorb in the area of cardiac surgery.

I think that free hemoglobin activated complement cytokines and other inflammatory mediators are some of the causative factors that will drive organ dysfunction. And although in the literature there is no clear concept of what those, just how much is bad, there has been a lot of studies that have documented ranges that are associated with the incidents of organ dysfunction. And based upon what we saw in REFRESH 1, we feel pretty good about where we are in the – in addressing the reduction of those inflammatory mediators with CytoSorb.

Joanne Lee

Okay, thank you. The second question is related to CAR-T, with Kymriah and Yescarta now approved, training programs and treatment protocols are being development and implemented which include the management of CRS. What are Cytosorbents plans in CAR-T going forward? Could we see CytoSorb emerge as part of the CRS treatment paradigm sooner than later with CAR-T now in the market?

Phillip Chan

Yeah, so the benefit that we have in this field is that we are approved in the European Union for the reduction in Cytokines. And the treatment of cytokine storm which includes as a subset cytokine release syndrome. We’ve published disclosed previously that we’ve treated actually now a dozen cases of a very similar disease entity called secondary hemophagocytic lymphohistiocytosis or secondary HLH, which is a cytokine storm that is trigged by typically a viral infection but that blossoms into an entity that looks and breeze like cytokine release syndrome seen in CAR-T Cell immunotherapy.

And we’ve had a, actually a lot of great success in treating that patients population which is one of the things that we’ve discussed in the past while we feel very confident that CytoSorb could help treat cytokine release syndrome in CAR-T Cell immunotherapy patients. We envisioned that that CytoSorb could be used in between the use of tocilizumab which is typically users for [inaudible] therapy for cytokine release syndrome. But before steroids which are used typically on three quarters of the patients who get cytokine release syndrome at [inaudible] is that they can actually kill the very expensive CAR-T Cell immunotherapy that is - has been disclosed won’t be costing somewhere $300,000 to $500,000 per treatment.

So, I think that in Europe we benefit from the fact of that we’ve had this clinical experience in HLH, we are approved to treat cytokine release syndrome and cytokine storm in Europe and other countries where we currently are like Russia and India and Vietnam and many other countries. So we think that once the approval spread abroad that we will likely get some fairly rapid usage, particularly in Germany where we have a very strong footprint amongst most of the major hospitals that would be doing this type of therapy.

And in the United States, we are – we would look to try to do some clinical studies, looking at the ability of CytoSorb to treat cytokine release syndrome here in the States. We’ve been fortunate to have had a lot of interest from a number of different cancer immunotherapy companies as well as critical care facility hospitals that are part of these studies about our technology, and we’ll give an update when we have a little bit more news.

Operator

And we’ll take our next question from Brian Marckx with Zacks Investment Research.

Phillip Chan

Hi Brian.

Brian Marckx

Hi Phil, nice quarter, congrats on the product sales number, it looks great.

Phillip Chan

Thanks.

Brian Marckx

On your meeting with FDA regarding REFRESH 2, I know in REFRESH 1 there may have been a question about the dropping platelets in the CytoSorb arm versus a control arm. Is there any you talk about that relative to your meeting with FDA, and whether there was any concerns around that?

Phillip Chan

I think what I would say is that I think that we’ve addressed any of those concerns appropriately and including potential risk mitigation steps based upon our analysis of our data.

Brian Marckx

Okay. And it sounds like based on the fact that you expect to start study prior to year end within the next seven or eight weeks that you expect to hear back from FDA relatively soon. And that your understanding is that this will be sufficient as a pivotal is, is that both – are those both fair assumptions?

Phillip Chan

Yeah, I think so. I think that it is a timeline to get to the end of the year but we’ve been working in parallel, doing a number of different things. We benefit from the fact that REFRESH 1 and REFRESH 2 are very similar type protocols where basically you’re just treating intraoperatively. And in REFRESH 2 we’re looking at subset of patients from REFRESH 1, so it’s not that we’re expanding the population but we’re actually narrowing the focus of the study.

So, we don’t expect that there will be – we will be starting in a number of the clinical centers that did REFRESH 1 so that they are already familiar with how to use the technology, their ethics committees have already seen what the protocol generally looks like, and I think there should be no major surprises in REFRESH 2.

And so I think that because we’ve been working in parallel, we think that we can get the study off the ground before the end of the year, we’re certainly going to try, we think that we’re on track to be able to do so.

Operator

Now at this time, I would like to turn it back to management for any additional or closing remarks.

Phillip Chan

Well, great. Well, thanks everyone for joining the all. And if you have any additional questions that were not addressed today, please feel free to reach out to Monique Kahf at Monique M-O-N-I-Q-U-E @lifesciadvisors.com and we’ll try to get back to you where possible. In the meantime, we look forward to the next earnings call and wish everyone a safe and healthy holiday season. Thank you very much everyone. Good night.

Operator

Thank you. That concludes the call for today. I’d like to thank everyone for their participation.