Biosite Incorporated Q1 2006 Earnings Conference Call Transcript (BSTE)

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Biosite Incorporated (BSTE)
Q1 2006 Earnings Conference Call
April 24th 2006, 4:15 PM EST Executives March 1, 0000 ET

Analysts

Bruce Cranna - Leerink Swann

Sean McKenna - Global Crown Capital

Rich Watson - William Blair and Company

Bill Quirk - RBC Capital Markets

Victor Gezunterman - Thomas Weisel

Steve Hamill - Piper Jaffray

Stan Mann - Mann Family Investments

Allister McKay - Gart Research

David Lewis - Thomas Weisel Partners

Benner Ulrich - UBS

Nadine Padilla

Good afternoon and thank you for joining us for this afternoon's conference call and webcast. Present today are Kim Blickenstaff, Chairman and CEO; Ken Buechler, President and Chief Scientific Officer; Bob Anacone, Senior Vice President, Worldwide Sales and Marketing; and Chris Twomey, Senior Vice President Finance and Chief Financial Officer.

During this call we'll discuss our results for the first quarter of 2006. After prepared remarks, we'll conduct a Q&A session. We are expecting a large audience, so please limit yourself to one question and one back up. Feel free to queue up as often as you'd like.

First, some general information. Today's meeting, which is open to the public and the media, is being simulcast on the Internet via our home page at www.biosite.com. During today's call we expect to discuss GAAP and non-GAAP financial results and projections, which are also included in our press release issued earlier today. A copy of our press release is available on our website, and we encourage anyone interested in more detailed information to refer to that information at your convenience.

Because today's conference call includes statements regarding Biosite's anticipated financial results as well as other forward-looking statements based on current expectations, we would like to remind everyone that our actual results may differ materially from those anticipated. Information on factors that could cause actual results to differ materially from forward-looking statements contained in our press release issued April 24, 2006 as well as in our Form 10-K for the year ended December 31, 2005, and will also be included in subsequent Form 10-Qs. We encourage you to review these carefully.

Forward-looking statements represent the Company's judgment as of April 24, 2006. The Company disclaims, however, any intent or obligation to update these forward-looking statements. With that I'll hand it over to Kim.

Kim Blickenstaff

Thank you, everybody. As you can see, the year started on a very solid note for us with continuing revenue growth in all of our different major product lines, so it was very encouraging. Also we had strong gross margins and very good operating margins that also contributed to better-than-expected EPS growth based on guidance we had given earlier.

I should note that just to simplify this, I'm going to make all my comments related to non-GAAP results when I talk about comparisons for the quarter over the same quarter of the prior year.

To get down to some of the elements here, product sales grew 11% over last year to a record $78 million in the quarter. That was primarily on the strength of our BNP franchise and good growth in our other cardiovascular and toxicology products. Also gross margins continue to be very strong at 71% so that helps the entire P&L.

Operating income grew about 11% over the first quarter of 2005, and our operating margins again hit 31% for the quarter. I think it's only the second time we've had that happen. Obviously the 21% earnings per share growth over Q1 of the prior year had both improvements in operating income gains as well as some non-operating items, income items that Chris will talk about in more detail.

Just to recap what we said about guidance for last year when we gave 2006 guidance in the last quarter, we said basically there were going to be four keys to hitting the revenue plan. Obviously we've got to hit revenues to make the rest of our financial goals:

  1. Number one was defending our BNP hospital franchise here in the U.S., that was a top goal for the year.
  2. Also, continuing to drive the growth of the cardiovascular product line that's including the classic Triage Cardiac as well as the new Profiler products and ultimately the MPO product later in the year.
  3. We also have as a top goal was to continue to expand our international and European presence in order to drive growth outside the US.
  4. Then finally, we really wanted to come back and focus on the POL efforts with BNP. There's been some favorable movement with CLIA last year and I think with the slowing growth rates in the hospital market, there's a feeling that there's a big opportunity in this segment of the marketplace for higher than average growth rates.

So those were the four issues that we really felt were key to making the year. In the first quarter we hit all of those objectives very nicely.

Just to recap, BNP sales grew 6% over the first quarter of 2005. We didn't have a strong flu season that helped those numbers. It was a fairly mild flu season, so there's nothing unusual there. We were able to defend our leadership position in the BNP market, and we also saw increases in the same account utilization as well as new account adoptions so we're still on the offensive.

In the high volume segment of the marketplace, we had strong sales and placement growth from our collaboration by filling our Triage BNP tests and the Beckman culture amino acid system. That's turned out to be a great strategy for us for continuing to see future growth.

We now believe that the Triage BNP and the Beckman platform is actually the second-largest selling BNP product in the market after our own Triage Meter products. That was very successful, helping them gain a major market share, and it's contributed to growth.

Also sales of other cardiac products which include D-dimer, Profiler, and Triage Cardiac grew at 50% on a combined basis. These combined product areas are on a run rate to be nearly a $50 million business for us in 2006. So it's starting to get to be a very significant part of our overall top line revenues.

International continues to have been a good decision. Revenues were up 19% to about $11 million for the quarter. That's 14% of our total sales. This is on track to be a business of at least $45 million for us in 2006. So another important subcategory.

Finally, Bob will talk more about our P&L positions off of sales efforts. But the face of new evaluation, the fact that we have a full sales force in place, all of that is very encouraging. I think the numbers are going in the right direction there.

Finally, during the quarter there was some important progress on launching next generation new products that are coming out of our market mining research. Ken will talk a lot more about some of the details on this. I think you all know that we're committed to maintaining a 15% reinvestment of our revenues back into R&D. When you have a record revenue quarter, then you have a record investment quarter for R&D, as well.

There were some significant progress in expanding our pipeline during the quarter in some areas that we think are very important and have significant unmet diagnostic needs. The first one came out of our collaboration with Lilly and we announced a collaboration where we will develop a test for protein C on our meter.

The hope is that through a clinical study we'll determine whether protein C measurements will guide digress administration and help evaluate patient response. It is a very interesting project, really the first of that kind for us. The protein C assay on the meter could be a very nice complement to our own program that's ongoing to find biomarkers for diagnosing sepsis and monitoring organ status.

Besides yielding a product out of this program that may have substantial revenues, the program itself serves as a model for biomarkers being used to target and guide drug therapies. That's a trend that we believe we're going to grow in the future, potentially providing us with significant new opportunities to collaborate with pharmaceutical partners in the future, if the program turn out to be a successful one for both parties.

Also, we've really ratcheted up the efforts on acute kidney injury. That's a very active program with the licensing of NGAL back in June, 2005. We're also looking at other markers that may be potentially useful. As we dig into the opportunity and are talking to physicians and doing market research, we are really zeroing in on the fact there is a substantial need for early and definitive markers to avoid the catastrophic damage that can be caused by a number of different procedures, conditions, and risk factors that put patients at risk for damage that may cause irreversible and costly end-stage renal disease, which is a very costly approach to treating these patients. So it's a very interesting area, very new to our thinking. It's moving into a very active development program for us.

Finally we've been developing interest in our portfolio planning in the cancer field. We would like to try to find biomarkers that will help not only diagnose cancer, but also cancer recurrence, which is a major problem. So our collaboration with Oxford Genome Sciences in the field of colorectal cancer is going to look at about 25 different biomarkers that might be useful to diagnose colorectal cancer recurrence, which usually happens in over about 30% of all cases within about 18 months of the original diagnosis of the presence of colorectal cancer. So it's a first foray into that area.

We have a lot of ideas on how to broaden that program and talk to other partners and really expand our efforts there. I think Ken is going to talk more about the opportunities, the unmet medical needs on each one of these. But they're very interesting programs, and we're excited that as we've expanded our revenues our programs and R&D have expanded, as well.

On some financial fronts we are enjoying extremely positive cash flow during the quarter. So we intend to continue to pursue the accretive effects of trying to buy our common stock on the open market. The $30 million stock buyback program that we announced last quarter has been completed. It was completed out of cash generated from operations during the quarter. So in essence, we had the same cash balance today as we ended the year with. So that was very encouraging.

We also continue to believe that at these levels, buying back shares is a sound investment and use of cash for us. So we've also announced an additional $50 million buyback program that we hope to complete over the next 12 months, depending upon market prices.

Then finally looking at the balance of the year, we're reiterating our previous revenue guidance for 2006 in the call today. We continue to see growth in the coming year and forecast year-over-year annual growth in total revenues of approximately 10% with slightly higher growth and EPS of around 14%.

So in total, the first quarter was off to a good start. Everything we wanted to try to accomplish was accomplished to a nice degree. We hope to see similarly strong performance in the following quarters and also hopefully improving outlook during the balance of the year as we get more visibility on the following three quarters.

So at this point I'll turn it over to Bob, and I think he will go into more of the market dynamics in each of the major product categories.

Bob Anacone

Good afternoon. I'm pleased to report that we started the new year with strong demand for our products, which we believe can keep us on track with our 2006 projections. This quarter was characterized by continued market expansion with existing products and market excitement over the potential of new products, some pending FDA approval.

Worldwide product revenues grew 11% year-over-year. Domestic product sales grew 10%. International sales increased 19% over the same period. BNP sales continued to grow year-over-year, increasing 6%.

In addition, we saw significant year-over-year growth in some of our other product lines. For example our Triage UA TOX products grew by 12% and in particular TOX had a much more robust growth rate than that of our visual DOA test. On a combined basis it was 12%. Our Profiler products and panels grew about 107%. Our Triage D-dimer product continues to grow with year-over-year sales increasing over 400%.

The resilience of our BNP franchise is very encouraging in the high volume lab-based segment of the BNP market. We continue to see both strong sales and placement growth for the Triage BNP for Beckman automated amino assay systems. Year-over-year sales growth in the Beckman systems was 68%, with BNP driven instrument placements growing substantially greater than 70%.

From a market dynamic standpoint, US BNP end-user volume in the first quarter increased 8%. BNP sales internationally grew 18% on volume growth of 31%. End-user pricing declined 7%, slightly less than expected. The majority of this due to Beckman placements where we encountered competition for higher volume accounts. I'll make some comments about our share of BNP and what's going on in the marketplace with Abbott and Dade and NT-pro at the close of the conference call.

In the POL segment as Ken referred to, we're expecting to see significant expansion of our base of U.S. POL customers in 2006. Q1 POL total revenues grew 29%, putting us in a run rate of greater than $10 million for 2006. First quarter BNP sales to the POL grew 32% year-over-year, with volume growth of 35%, making this segment a growing contributor to our bottom line.

As many of you know, we were granted CLIA waiver status late last year. The BNP CLIA waived modifier to facilitate billing and reimbursement took place on January 1. This makes available to us a large, untapped market opportunity of more than 36,000 CLIA waived labs and an additional 19,000 moderately waived labs in the United States. Currently we're focused on the 36,000 CLIA waived labs.

We believe Triage BNP on the meter is well suited to capitalize on this large opportunity. Therefore, we embarked upon a POL initiative for 2006 that includes the formation of a dedicated sales, marketing and support organization to focus our efforts on this opportunity.

Specifically, we have recruited, hired, and trained an additional six full-time POL sales representatives for a total of eight, including a dedicated sales manager to better leverage this opportunity. Additionally we're in serious discussions with distributors who have experienced a successful track records of building POL sales. We believe these new distributors can augment the efforts of our existing POL distributors.

BNP POL account closes grew 32% year to date. putting us on a track to realize a sizable growth in our POL customer base in 2006. We also believe that MPO can be a source of new growth for the future pending its approval by the FDA. Our pre-launch marketing activities have generated unprecedented interest in this novel cardiac marker.

As a measure of the interest in the tests today, over 1,700 physicians and laboratories have participated in recent educational teleconferences sponsored by the Company. In addition, more than 1,000 existing customers have requested information on the product.

Our product introduction strategy calls for significant marketing effort geared to educating the marketplace on the patho physiology and clinical utility of MPO. This effort will be spearheaded by the use of thought leaders in the field of cardiac markers. The product will be positioned as an early marker of arterial inflammation.

The product will be available in two configurations. Initially as a single Triage MPO test followed by -- including MPO as part of our Triage cardio profiler panel. We believe we will have the competitive advantage of being first to market with our rapid 15-minute MPO test. Product introduction will be supported by two key articles on the use of MPO that are published in peer review journals: The New England Journal of Medicine and Circulation.

Our international business will almost certainly continue to grow at a faster rate than the US. We have established marketing and sales subsidiaries in most of the countries comprising Western Europe. We are transitioning to a direct selling effort in the Netherlands, Italy, and Switzerland. We're also adding to our direct sales force in Germany and France. France continues to be a star, outperforming expectations with record sales in excess of a million euros per month.

In January we hired a general manager for Asia Pacific and opened our Biosite office in Hong Kong. Overall, international sales increased 19% to $11 million or 14% of total sales. This puts international sales on a run rate that will likely approach $50 million.

In closing we are confident we have strategies in place to both defend and grow our BNP franchise, our cardiovascular product line continues to grow and we are enthusiastic over the early interest in our latest new product on the horizon, MPO.

We are pleased with the early market traction realized in the POL market. We plan to continue to invest in building a direct presence in the international markets, thereby driving sales growth outside the US. We expect to see continued demand for both existing and new products. We are pleased with the results to date which we believe should keep us on track to meet our expectations for 2006. With that, I'll turn it over to Ken.

Ken Buechler

Thank you very much, Bob. The discovery and R&D group are at work on a number of development programs that are intended to help us fill the broad and balanced product portfolio that can result in sustained growth for our Company. One focus this quarter has been the FDA submissions on stroke, MPO, D-dimer, and TOX plus methadone.

In the research setting we continue to search for markers to comprise panels that can aid in the diagnosis and prognosis of patients suffering from acute coronary syndromes, sepsis, kidney injury, abdominal pain, and colorectal cancer, in addition to other conditions we are studying that we have not made public.

We continue to be pleased with results from Europe on the utility of the Triage stroke panel. On the discovery front, we have signed several important collaborations with companies this quarter.

In the area of colorectal cancer, we signed a deal with Oxford Genome Sciences to evaluate markers to aid in the diagnosis of colorectal cancer in patients who have relapsed. A panel of markers would enable physicians to direct the appropriate treatment to the patient. The fecal occult blood test and colonoscopy, which is a highly invasive procedure, are the most frequently used screening and diagnostic methods for colorectal cancer. The recurrence rate is 30% to 40% within an average of 18 months after the primary diagnosis.

Under the terms of the agreement, OGS will identify at least 25 proteins discovered in blood and tissue samples from elapsing colorectal cancer patients. Biosite will have the rights to develop blood-based diagnostic tests using one or more of those biomarkers.

In the area of sepsis we have signed a deal with Eli Lilly to develop a rapid point of care diagnostic that measures the concentration of protein C in blood. Lilly will use the Biosite test as well as other existing FDA approved protein C tests to enroll patients in its upcoming Phase 2-B clinical trial which is expected to begin in the fourth quarter of 2006.

The clinical trial is termed Respond and stands for Research Evaluating Serial Protein C levels in severe sepsis patients on Drotrecogin-alpha. The study will investigate the use of protein C assays in connection with the administration of Lilly's severe sepsis drug, Xigris. Investigators will use tests in this novel study to help with an individualized dose and duration of Xigris therapy and to evaluate patient response. The agreement also grants Biosite rights to intellectual property in the field of sepsis diagnosis, including assignment of US patent application number 10-759-216 termed Biomarkers for Sepsis.

The Triage cardio profiler plus MPO and Triage MPO FDA 510K pre-market notification was submitted in September. The Triage cardio profiler plus MPO panel has five markers comprising myeloperoxidase, BNP, Troponin I and its complexes, CKND, and myoglobin. The panel is strong and predicting early ACS within the zero to six hour timeframe when Troponin is not elevated or detectable.

The panel was designed to be sensitive and specific using the first blood draw. We believe this can potentially minimize repetitive testing and enable physicians to make more accurate and rapid treatment decisions for patients suffering ACS. We have recently received comments from FDA on our submission as part of the normal review process, and we are in the process of responding to their questions.

We anticipate launching Triage MPO and Triage cardio profiler plus MPO in early Q3 of this year in the U.S., subject to obtaining FDA clearance and in the rest of the world, also in early Q3. With respect to the multimarker index for this product we anticipate launching in the EU in Q3, pending CE markings and other appropriate registrations.

We continue to study markers for the assessment of acute kidney injury. Currently there is no methodology that can be used to predict when the kidney is at risk of being harmed. We see this as an unmet need.

Physicians use creatinine to assess kidney injury but creatinine only indicates that injury has already taken place. Creatinine does not help to predict the risk of preventible kidney injury before it occurs. Although creatinine is widely used by the medical community, its shortcomings are also widely acknowledged. Acute renal failure affects hospitalized patients and particularly patients in the intensive care unit. Patients with acute renal failure and complications with other organ dysfunction can have mortality rates as high as 40^ to 70%, Acute renal failure is associated with various high-cost medical problems, treatments, and procedures.

By rapidly assessing the likelihood and potentially the extent of kidney injury, prior to the kidney undergoing irreversible damage, we believe we can give health care providers the opportunity to use available treatment options to avoid or reduce injuries and significantly improve the outcome of the patients.

The assay for NGAL, which stands for neutrophil gelatinize associated lipocalin has been developed on the Triage device and we will be evaluating the performance of NGAL as well as other markers in assessing kidney injury.

We continue to make progress in defining a panel of markers to identify patients suffering from sepsis. We have now evaluated 110 markers, and our goal is to define a panel of markers that can aid in the diagnosis and prognosis of sepsis using the first blood draw.

We are continuing to define the final panel, and our results from a preliminary panel show that six markers can identify sepsis with a rock curve area of about 0.88 using the first blood drawn from the emergency department. Dr. Manny Rivers of Henry Ford presented it an abstract of prior sepsis data at the IFICEM meeting in Belgium on March 22. It was well received.

The markers he discussed will not necessarily be on the final panel. But that research as of October of last year showed that the markers protein C, myoglobin, BNP, TCL19, D-dimer, and MPO contributed to the diagnosis of sepsis from patients presenting to the emergency department. Furthermore, the MMX value increased as the severity of sepsis worsened. We anticipate starting field clinical studies in the third quarter of 2006.

Progress continues on the discovery of markers related to the most common causes of abdominal pain including acute pancreatitis, appendicitis, ischemic bowel, and acute colicystitis. We have measured 67 markers to date in over 2500 patient samples.

Abdominal pain is the most common complaint of patients presenting to the emergency department, totaling over 7.5 million presentations in the United States alone. We anticipate defining a panel in the first half of 2006.

The Triage TOX product will be improved with the addition of methadone to the panel. 510K pre-market notification was submitted in March. This drug screen currently measures amphetamine and methamphetamine, metabolize propane, benzodiazepine, opiates, tricyclic antidepressants, PCP, THC, barbiturates, and perpoxiphine. The addition of methadone for the panel allows physicians to monitor methadone levels in patients on methadone maintenance programs as well as to assess cases of methadone overdose.

We continue to work with FDA on the Triage stroke PMA application. We are currently working on the analysis of new data that comprise an additional 800 patients, bringing the total population to approximately 1,500. We are very pleased with the results of evaluations in Italy and France of the Triage stroke panel. Both studies combined comprise over 250 patients. The Italian study was presented at the national conference of cerebral injury in Florence at the end of March. The data showed that among the 56 patients with a normal Cincinnati pre-hospital stroke scale score at Triage, 13 had a stroke. In this subgroup, an MMX value greater than 4.5 showed a sensitivity of 0.85 and identified all strokes except two.

In the case of the study in France, the data was found to be consistent with the data from the direction insert. Additionally the Triage stroke panel was shown to add incremental value to the assessment of stroke as defined by an expert Triage personnel, either adding more sensitivity or specificity depending on the level of caution used by the health care professional in defining stroke.

The abstract was accepted, and the data will be presented at the European stroke conference at 12:30 on May 18. The data confirmed that the Triage stroke panel could add to the diagnosis of stroke and could be useful in rural hospital settings where expert neurologists may not be available.

The red hot trial has now enrolled 503 patients with a goal of 680 patients. This trial was designed to study the benefit of monitoring heart failure patients in the emergency department using BNP. The trial is divided into two arms, one where the physician is blinded to BNP and the other where the physician sees the BNP.

The end points are death, rehospitalization due to a cardiac condition, and overall quality of life. We are planning to do an interim analysis of the data this quarter. This trial has had slower enrollment in the control arm than anticipated due to BNP being used as the standard of care and the sites not wanting to enroll patients in the arm where physicians are blinded to the BNP values. This factor has also dramatically slowed enrollments in the rabbit trial, as well, where we have enrolled 373 patients with the desired enrollment of 720 patients. The control arm enrolled only 172 patients.

The rabbit trial was designed to assess the benefit of monitoring BNP in the out-patient heart failure population. The rabbit trial is a close analogy to the hot trial except that the setting is in the out-patient clinic. The rabbit sites have been communicated to stop enrollment, and we are currently focused on resolving all queries and closing sites.

The litigation between Biosite and Roche diagnostics filed in Federal District Court in Indiana and San Diego are currently stayed at the request of the parties, and that stay ends very shortly. Biosite and Roche have held discussions during the stay, but as of today we have not reached an acceptable settlement. If no settlement is reached, we will continue to pursue the cases vigorously. While litigation is unpredictable, particularly in the early stages that these cases are in, we continue to have confidence in our positions in both Indiana and San Diego. And with that, I will turn it over to Chris.

Chris Twomey

All right. Thanks, Ken. I'll try to wrap up the comment portion of this with a few quick comments on some of the details that weren't covered in the release. We do have a lot more information in the release these days. So I'll just focus on a couple of things I think that are of interest. I, too, will talk only on a non-GAAP basis. We think that's the most effective way to do comparisons between year-over-year and again the difference between a GAAP and non-GAAP is the compensation charges under FAS 123 for stock compensation. Again, these will be non-GAAP numbers.

But again, pleased at the top-line growth of 11% and the earnings per share growth of 21%. So we're already well on our way to achieving our goals for the beginning of the year financially. On the BNP business, we did see end-user kit increase of 15% over the prior quarter. So we did see that seasonal impact from the flu season. And again the BNP for the Beckman platform product was about 29% of our total revenue. So it's still showing some real strong growth there as Bob pointed out.

But as indicated in the release, we're also real pleased to see the growth in the other cardiovascular products that's over 50% year-over-year. And that's our cardiac product, the profiler product as well as the D-dimer and stroke product. So we're seeing some real strong balance to growth overall.

The international business, as Bob pointed out, grew nicely at 19% over the prior year, and is now over 14% of our revenues. The POL, physician's office lab business was about $3.2 million for the year, or for the first quarter and that's up 30% over last year.

For those keeping track of our inventory levels, this is our inventory levels at Fisher, We did see a decrease in inventories at Fisher by just around $1 million versus an increase in the fourth quarter of last year of over $1.5 million.

So I think that's most of the revenue comments. I would point out that the BNP business internationally was about $5.6 million for the quarter. So that takes care of the revenues. On the margin, again, we're still in line with what we had last quarter and for the first quarter of last year. We're continuing to see the positive results of our increases in the yields and efficiencies as we've sort of stabilized our production and continued to see real strong margins in excess of 70%.

On the operating expenses, we did see growth in our SG&A line. We, as Bob pointed out, we did see some increases in employees not only in the physicians' office lab but also in areas of senior management and also some of our clinical studies and the like, we're seeing a significant investment. So that did grow pretty much in line with our expectations. The research and development line was a little bit higher.

We did see growth for some of the production product transfer costs. That's the cost of some of the MPO and many of the products that Ken was mentioning. We're seeing pre-approval expenses in the area of manufacturing scale-up for those.

The litigation cost, as we all know, the stay was effective for the whole quarter. We just saw some minor costs there. And pending resolution, we would expect to see that either spent on litigation or internally in other programs within SG&A and R&D. So that's why there's pretty much nothing there this quarter.

The interest and other income we did see continued growth there. That's a reflection of high cash balances as well as higher interest rates. I will mention a little bit on this tax issue. We did have an IRS audit this quarter, and while we try to be conservative here, we were able to relieve some reserves that we had on the books for potential exposure in the are of an IRS audit. We were able to take about a $900,000 credit to the P&L for reserves that weren't required post audit. So that's kind of a one-time charge or one-time benefit that we saw for the first quarter.

The balance sheet real strong, as Kim indicated. I believe it's in the release that the cash flow from operations is in excess of $30 million, that enabled us to complete the stock repurchase. We did see some increases in current liabilities. That's really more an issue of timing of payments to the IRS for 2006's taxes. CapEx was in excess of $6 million, about $6.5 million. That's pretty much it for the balance sheet.

I'll give a little bit of color on the quarter. We do have a table in there that really lays out most of our assumptions. I'll start with the second quarter.

We are anticipating the sequential change as we get out of the winter quarter into the spring. An actual decrease in volume of about 4% to 5% for BNP business. Overall year-over-year, comparing the second quarter of '05 to the second quarter of '06, we are expecting an 8 to 9% increase in kit volume.

The other cardiovascular products, again, real strong over 40% growth in those for the second quarter. And overall total revenues increase of around 5%. The inventory change as I indicated in the first quarter, we had about a $1 million decrease in inventory at Fisher. We'll see about 0.5 million of that come back in the second quarter.

International revenues as indicated in the release, up to about 14.5% of our product revenues, which is a 30% growth year-over-year. And I would comment that as I said in the earlier comments about the license and patent dispute line that whether we spend the money on the lawyers as it relates to the litigation or internally for other programs, we anticipate to see that start to increase starting the second quarter. Overall EPS growth in the second quarter is about 5% year-over-year.

So the key drivers there is the balanced growth. Increasing utilization year-over-year versus declining prices. I think overall the second quarter's relatively a little bit slower than the first quarter. So we're kind of predicting that to be consistent in this year.

Overall for 2006 now, total revenues going up about 10%. BNP's the primary driver of about 40% of that growth, which is about $11 million I believe of growth for the BNP products. The other cardiovascular products growing 40% year-over-year. Again, that's the results of RSOB and the D-dimer and some of the other products that we see coming onboard.

I think that's about all I really have to add here. Most of the rest is in the release and we'll open it up to questions at this time.

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from Bruce Cranna with Leerink Swann. Please proceed.

Bruce Cranna - Leerink Swann

Good morning. Just so I'm clear on this, Chris. The guidance for the year, let's say 230 or something, earnings guidance includes some additional litigation expense due to Roche after April?

Chris Twomey

Right. So assuming if we're not able to reach a settlement we would spend, I think the total is around $2 million to $3 million for the year. And if we do settle then we have other plans for those costs. So lump it all in operating expenses.

Bruce Cranna - Leerink Swann

Then I know you guys don't like to talk about the actual accounts you're in number-wise, actual hospital accounts. But it sounds like this quarter you had maybe net adds. Is that a fair way to look at it?

Kim Blickenstaff

That's true. We did. We actually saw fewer losses than projected especially as it relates to BNP and Bixis, and new account closes exceeded losses.

Bruce Cranna - Leerink Swann

Just on the stroke side and the language in the press release with FDA, I know you probably don't want to talk a lot about that either, but you talked about regarding your anticipated submission of additional information there's already been some give and take, hasn't there? Didn't you already submit or have some additional submission? Is this like a second trounce of information?

Ken Buechler

Yes, we're in the process of continuing to analyze the data that we have. And we're continuing to work with the FDA on the submissions.

Bruce Cranna - Leerink Swann

Okay. Thank you.

Operator

Your next question comes from the line of Sean McKenna with Global Crown Capital. Please proceed.

Sean McKenna - Global Crown Capital

Hi, guys, can you hear me?

Ken Buechler

Yes.

Sean McKenna - Global Crown Capital

Questions on BNP. I know last quarter you guys had talked about what you were expecting in terms of price erosion; and, correct me if I'm wrong, I think you were saying around 5% or there was some kind of range. I was wondering where you came in relative to your expectations there?

The second part of that is, I was wondering if you could talk about how many POL accounts that you guys added?

Kim Blickenstaff

I'll take the first part on the price erosion. The guidance that we had given was around 8% to 9% for the year, price erosion. That's kind of consistent on a quarterly basis, as well. The actual numbers for the first quarter was only about a 7% decline. This would be first quarter of '06 compared to the first quarter of '05. I think the guidance at this point is around 7%, 8% year-over-year. So it's slightly better than what we had been seeing and had anticipated to continue to see. So we're pleased with that.

Sean McKenna - Global Crown Capital

What do you attribute that to?

Kim Blickenstaff

On the POL side, we started year-on-year at 32% growth in the number of accounts. We would expect, we have every reason to believe that would continue given the investment we've made.

Sean McKenna - Global Crown Capital

Great. I kind of missed the thing about pricing erosion. What do you attribute the better than expected erosion to?

Kim Blickenstaff

Yes. I can give you a little bit of market commentary, so to speak. I think in Q1 we had expected Abbott to introduce BNP on the iStat and we had projected a specific number of losses due to the introduction of Abbott on the iStat. We didn't see that. We expected Abbott to come in at a certain lower price, and we didn't see that. So I think that played into that significantly.

Also, we've been realizing intense competition from Dade regarding NT-pro versus BNP. But we're not realizing the number of losses there. We're feeling the competition and the pressure but not realizing a number of losses. That may be due to the fact that Dade and the stratus reagents had a recall resulting in product outages. That may have played into that also.

Sean McKenna - Global Crown Capital

Thanks very much.

Operator

Your next question comes from the line of Rich Watson with William Blair and Company. Please proceed.

Rich Watson - William Blair and Company

Thanks. Can you just give us a little bit of color regarding what's driving the international businesses? If it's one or two things there? Is it more just adding to your infrastructure geographically? Are there any particular products that are doing well there? Then I was hoping Ken could maybe just review the rabbit trial again and what the status is there and what should we think about for timelines in terms of data from that trial going forward? Thanks.

Kim Blickenstaff

Sure. I can comment on the international market. BNP sales is robust, growing 18% with volume growth of 31%. We continue to invest in putting direct feet on the street so to speak, and we plan on continuing that direct effort as well as the direct support effort. So we feel good about that.

Ken Buechler

In the case of the rabbit trial I would say it's somewhat bitter and sweet. The bitter is that we wanted to originally enroll 720 patients, and to date we've only enrolled 373 patients. This is largely due to the fact that our control arm has essentially stopped enrolling patients because BNP -- and this is the sweet part -- BNP is essentially the standard of care at this time.

So without a control arm that is really going to enroll patients it doesn't do us much good to enroll patients and incur costs in the experimental arm. So as a result of that, the rabbit trial we will stop enrolling, and we're currently in the process of closing the sites and resolving all of the case report forms for that trial.

Rich Watson - William Blair and Company

Thank you.

Ken Buechler

You're welcome.

Operator

Your next question comes from the line of Bill Quirk with RBC Capital Markets. Please proceed.

Bill Quirk - RBC Capital Markets

Good afternoon. Quick question. Chris, you may have touched on this, I may have missed it. SG&A came in a little bit better than our expectation. As we're thinking about the direct adds both in terms of the direct team, as well as the continued build out for your direct effort outside of the U.S., how should we think about SG&A in general kind of trending throughout the year?

Chris Twomey

Well, we don't really get into that level of detail because we kind of like to have the ability to interchange between, as I mentioned before, the litigation and the R&D. It is a little bit less than what we had anticipated in the first quarter, as well. But I think overall if you look at it for the year, it's closer to 25% than what it has been in the past. This is, again, non-GAAP.

Bill Quirk - RBC Capital Markets

Understood. Fair enough. Ken, just a quick question on the sepsis panel. There was some language in your initial comments that sounded like the panel isn't completely finished. In other words, we could still add new markers. Did I understand those comments correctly?

Ken Buechler

Did you understand what?

Bill Quirk - RBC Capital Markets

What I'm trying to figure out is we're talking about moving the sepsis panel into clinical trials in the second half of '06. So can we assume at this point that the actual make-up of the panel is fixed, or is that still in flux as we continue to evaluate markers?

Ken Buechler

Yes, we have a short list, let me put it that way. We're in the final stages of defining that panel.

Bill Quirk - RBC Capital Markets

Okay. Thanks for the clarity there. Secondly -- and maybe I'm getting a little ahead of myself here -- but if we think about how the sepsis panel will be marketed, should we initially assume that you're going to go after patients that are in the ICU, i.e., those patients that are at high risk of sepsis? Or should we think of this more of a screening assay that hospitals are going to use upon admission, for example?

Ken Buechler

Yes. Right now we're studying patients presenting to the emergency department. But you bring up a very good point that probably about 50% of patients in the ICU have sepsis. This is a very important patient population for us, because although they may be known to have sepsis, what isn't known in these patients is whether or not they're getting worse from the sepsis. As we all know, sepsis can kill one very quickly. So being able to identify the prognosis of patients in the ICU is very important. That is in our focus, as well. Initially it will be for diagnosing patients presenting to the emergency room with signs and symptoms of sepsis.

Bill Quirk - RBC Capital Markets

Thank you very much.

Operator

Your next question comes from the line of Victor Gezunterman with Thomas Weisel. Please proceed.

Victor Gezunterman - Thomas Weisel

Good afternoon. It looks like the Triage cardiac panel was a little lighter than expected, sequentially down. I was just wondering is there some substitution for the Profiler? Is Profiler cannibalizing some of the cardiac panel sales?

Kim Blickenstaff

Yes, that's correct.

Victor Gezunterman - Thomas Weisel

Can you try to quantify that for us?

Kim Blickenstaff

There's net growth in Triage cardio profiler. It's significant. I don't know that we have it right here. But the Triage cardio profiler of course is a higher ASP for us. It includes BNP whereas the Triage cardiac panel does not. The profiler product gives more information to the physician, and as a result, we believe that the sales that are lost in Triage cardiac are essentially going into the cardio profiler.

Victor Gezunterman - Thomas Weisel

So we can actually expect the cardiac panel to be flattish or maybe declining going forward?

Kim Blickenstaff

Potentially.

Victor Gezunterman - Thomas Weisel

Okay. This may have been mentioned in the press release. How much do you expect in the CapEx in '06?

Kim Blickenstaff

I don't think that's in there actually. The total is $30 million to $35 million.

Victor Gezunterman - Thomas Weisel

Does your new EPS guidance include the new stock repurchase plan?

Kim Blickenstaff

It does not. It does include, of course, the full impact or the impact for the balance of the year for the repurchase that took place in the first quarter.

Victor Gezunterman - Thomas Weisel

Okay. All right. Thank you.

Operator

Your next question comes from the line of Steve Hamill with Piper Jaffray. Please proceed.

Steve Hamill - Piper Jaffray

Good morning. A couple questions for you, Ken. First, I just want to go back to this rabbit decision. Because I'm not sure I'm understanding what you're saying. I would certainly assume in red hot, the new clinical standard today is BNP testing. But it would seem that in the out-patient setting where rabbit is focused that that's not the case yet. So why do you think you're actually having trouble enrolling that control arm?

Kim Blickenstaff

Well, actually, Steve, it is happening. Even though it is an out-patient category those are major centers that the clinical trials are being performed in. As a result, centers are using BNP as the standard of care. So unfortunately it's -- or fortunately depending on however you're looking at it -- we're not enrolling in the control population.

Steve Hamill - Piper Jaffray

So how does that change your view, or does it change your view of the POL opportunity? If BNP is already being used heavily in the out-patient setting, which is what it sounds like you're saying.

Kim Blickenstaff

What I said was that BNP is being used in these major centers. As a result, these major centers where we're performing these clinical trials are not interested in enrolling patients without seeing the BNP. Now, having said that, if we are very interested in the concept of continuing a clinical trial like this, we would reinvest into sites that are not as major and not as sophisticated in measuring BNP. But at this time, that isn't the case.

Steve Hamill - Piper Jaffray

Okay. That's more clear. In terms of MPO, you mentioned that you're going to go to market with two studies. You mentioned Circulation and New England Journal of Medicine. To my understanding, both of those studies if they're the ones that I'm aware of are both, with regard to MPO as more of a long-term risk marker where used alongside of C-reactive protein or cholesterol. How will they help you sell MPO as an acute marker?

Kim Blickenstaff

Yes, well, you're absolutely right, Steve. MPO, it just doesn't have to be used alongside cholesterol or CRP. In fact, the risk stratification status of MPO is better than either BRP or cholesterol. But you're right, that we are interested in getting an indication for use from the FDA that looks at the diagnosis. We have said that repeatedly.

Steve Hamill - Piper Jaffray

So basically it would be the trial that you would submit to the FDA -- well, there's not really a trial here. We're talking about a 510-K. I'm confused as to what data you would go to market with, with the use of it as an acute test.

Kim Blickenstaff

Well, again you mean with respect to a trial that's already been published? I mean, there's two papers published that are for prognosis and you indicated that correctly. The trials that we have performed obviously, because we've talked about it repeatedly, relate not only to prognosis but also early diagnosis of ACS, when Troponin is not elevated.

Steve Hamill - Piper Jaffray

Are those papers that you think you'll be able to publish sometime soon in terms of your own work?

Kim Blickenstaff

Absolutely.

Steve Hamill - Piper Jaffray

Can you give us any prospective timing?

Kim Blickenstaff

I can't.

Steve Hamill - Piper Jaffray

Okay. Then one last question Chris, if I could, with regard to the gross margin. It looks like you've assumed at least a little bit lower gross margin in the back half of the year. Is that based on pricing, that you assume that pricing will have more of an impact in the second half?

Chris Twomey

Yes, that's actually a few things. Price, of course, has an impact. As we bring all these new products that we're talking about to market, some of the charges that had hit R&D in the past will start to hit operations line when we start to sell those products. There's the full impact of the facility, I suppose, has a little bit. We're not talking about big numbers here, but all of those have some pressure on the margin.

Steve Hamill - Piper Jaffray

Great. Thank you.

Operator

Your next question comes from the line of Stan Mann with Mann Family Investments. Please proceed.

Stan Mann - Mann Family Investments

Excellent job, gentlemen.

Kim Blickenstaff

Thank you.

Stan Mann - Mann Family Investments

I have three questions. One --

Kim Blickenstaff

If you could just speak up a little bit, Stan.

Stan Mann - Mann Family Investments

Can you give us a little more, as everybody says, color on the stroke trial?

Kim Blickenstaff

On the stroke trials?

Stan Mann - Mann Family Investments

Yes. I imagine you've given away a lot of product for tests. What is your outlook--.

Kim Blickenstaff

Sorry. Stan, I didn't hear the end of your question.

Stan Mann - Mann Family Investments

What's the outlook, prognosis for the rest of the year, in Europe on the stroke panel?

Kim Blickenstaff

Well, we're very excited about the results that we've seen so far with the utilization of Triage stroke. It clearly adds to the diagnostic armamentation of a physician. Especially in hospitals that don't have expert stroke triage personnel. So it's very slow early on, as BNP was. What we're finding of course is that this is a new concept. This is a new product. But like BNP, we anticipate a continued sales effort as well as an educational effort to teach physicians how to use the test. This is happening in Europe, of course, not in the United States.

Stan Mann - Mann Family Investments

Do you have any idea of the potential sales value of this product in Europe?

Kim Blickenstaff

It's small at this point.

Stan Mann - Mann Family Investments

I meant the future.

Kim Blickenstaff

You mean the overall market?

Stan Mann - Mann Family Investments

Future, yes.

Kim Blickenstaff

It's probably at least, $250 million a year. That's in Europe alone.

Stan Mann - Mann Family Investments

That's substantial. Second question, Beckman. What other tests do you see moving to the Beckman machine business in your portfolio?

Kim Blickenstaff

No comment at this point in time.

Stan Mann - Mann Family Investments

Okay, thanks. Good job in starting to buy in your stock. Good job, gentlemen. Thank you.

Kim Blickenstaff

No problem.

Operator

Your next question comes from the line of Allister McKay with Gart Research. Please proceed.

Allister McKay - Gart Research

Hi, this is a question going back to the sepsis work. Could you comment at all about the intellectual property that you've gained the rights to from Lilly? Note that is a patent application rather than a patent that's made it all the way through. Whether you could say anything about what the prospects or the timeline for approval is?

Then just ask the related question whether of the 20 or 30-some markers listed in that patent, if there's any that you would care to comment on as being particularly attractive in terms of sepsis explorations.

Kim Blickenstaff

Well, they're all particularly interesting, Allister. I'm not going to comment specifically on any one of them, as you could imagine. The application, as you correctly pointed out, is an application at this point. However, one can look at the priority dates and recognize it has a very early priority date. If the application becomes an issued patent, then obviously we'll have the rights to it. So we're very enthusiastic about the prospects of that. And potentially one or more of those markers in that application may be on our panel.

Allister McKay - Gart Research

Okay. Thank you.

Operator

(Operator Instructions) Your next question comes from the line of David Lewis with Thomas Weisel Partners. Please proceed.

David Lewis - Thomas Weisel Partners

Good afternoon. A couple quick questions here. Bob, has there been any change that you've made or plan to make in 2006 as it relates to how your sales force will be spending their time as BNP begins to slow down? How are you changing compensating structure or commission structure or incenting them to push other products differently in '06 than you would have in '05?

Bob Anacone

Well, a major thrust, David, is to continue to vigorously defend our BNP franchise. We have some strategies in place to do that, and I won't be specific. So we have not changed our basic time allotment in terms of sales force time in the US. Although some of that will begin to be taken up a bit with the launch of NPO. Obviously, sales reps have a lot of enthusiasm in terms of new products. So there will be some sales force adjustment in the second half of the year with the launch of NPO. But we're not significantly going to decrease our selling effort and our time allotment in terms of sales time away from BNP.

David Lewis - Thomas Weisel Partners

Okay, Bob, you mentioned the iStep product and we were expecting more of an impact here in the first quarter.. As you think about that product and the work flow at the bed side, do you envision that being more important for BNP for monitoring as opposed to diagnostic or prognostic? How big of a segment of your market do you actually think iStat truly represents?

Bob Anacone

Boy, that's hard to know. I think intuitively that we do see it going more to a monitoring application than competing against us directly in the diagnosis. But how that plays out is hard to foresee.

David Lewis - Thomas Weisel Partners

Okay. Just two quick financial questions. First of all, Chris, I don't believe the manufacturing switchover has been complete. Is there an inventory build we should expect or any implications for gross margin in the next quarter or so as that move goes forward?

Chris Twomey

No, no. You're talking about it not being complete. I mean, we've moved all of our operations except for the final assembly of the product and the packaging of the product. So all of the chemistry work, all the antibody work, all of the precursors to the final assembly are over here. We have that impact already known. So as far as building up any inventory for the packaging, we've started to move some of the lines over, and we can do them in a staggered way that you don't need to build up inventory.

David Lewis - Thomas Weisel Partners

Great. And then I think you mentioned, I may have missed it, you said Beckman as a percent of sales was 29% in the quarter?

Chris Twomey

Yes.

David Lewis - Thomas Weisel Partners

Does the gross margin for the year forecast that Beckman stays relatively stable at 29% or would you like to see or expect that the 29% would grow to something to 32% to 35%?

Chris Twomey

It does increase. I don't know off the top of my head what the percentage for that is. We really don't get into that granular detail. But it is growing, it has grown. We're seeing closer to one-third of the business now. I don't know what the total would be for all of 2006. We can get that for you.

David Lewis - Thomas Weisel Partners

Perfect. Is it safe to say that a move of 200 to 500 basis points or 200 to 400 basis points was likely factored into your existing gross margin guidance?

Chris Twomey

Yes.

David Lewis - Thomas Weisel Partners

Thank you very much.

Operator

Your next question comes from the line of Steve Hamill with Piper Jaffray. Please proceed. Thanks.

Steve Hamill - Piper Jaffray

Thanks. I've got just a couple follow-ups. First, at this point, do you have an estimate as to how much of the Beckman installed base you've penetrated?

Kim Blickenstaff

No, we don't.

Chris Twomey

No.

Steve Hamill - Piper Jaffray

Is it safe to say that there's still a lot of opportunity among Beckman instrument owners?

Kim Blickenstaff

Yes, there is.

Steve Hamill - Piper Jaffray

Okay, second, Kim in terms of bigger picture on the pipeline, how do you see cancer fitting into the Company? Clearly it's a departure from your roots as a more of an emergent care, acute care diagnostic company.

Kim Blickenstaff

Well, I think I sort of see it fitting with the BNP model and the monitoring of people, better managing their disease in an out-patient setting. I think as long as you can find entry points that are fairly concise where you don't have a physician base that's so large, I think that's a pretty compelling strategy. I mean, they urgently want to know whether there has been any sign of reoccurrence; the earlier you pick that up, the better you can intervene. I think it fits better than a mass screening kind of strategy where you try to go out like Cytek and get mass screening for cervical cancer. That's a long road. Clinical trial hurdles are very high.

I think the cancer recurrence concept is pretty interesting in this colorectal area. It was clearly market research showed that it was an interesting driver. You are right. It is not acute setting within the hospital, but it still has an urgent time, need to know. There is still time because the reoccurrence, the earlier you catch it the more you can do. I think it's a good entry point into that category. We like some of the other ideas that we're thinking about.

Steve Hamill - Piper Jaffray

Is that one where there is a good chance you would partner up with a big box manufacturer, as well?

Kim Blickenstaff

Unknown at this point in time. I think that's yet to be decided.

Steve Hamill - Piper Jaffray

Okay. Thank you.

Kim Blickenstaff

That's always an option. If we see a rapid or urgent need for a test where it could go routine for some application, we're always going to look at the platform players to see whether we can't expand our overall market share rather than just abdicate it.

Steve Hamill - Piper Jaffray

But is it safe to assume you wouldn't probably pick up the dollars in R&D spending now if you didn't see some sort of point of care application then?

Kim Blickenstaff

True.

Steve Hamill - Piper Jaffray

Okay.

Operator

Your next question comes from the line of Bruce Cranna with Leerink Swann. Please proceed.

Bruce Cranna - Leerink Swann

Good afternoon again. Just a couple of follow-ons if I could, while I have you here. Just on the stroke in the EU, I don't know if anyone wants to maybe take a shot at, what I'm trying to figure out in terms of traction, it seems you're moving ahead slightly. What sort of level of sales do you think, Kim, you need to get to to be at breakeven or do you consider yourself already at breakeven with that product?

Kim Blickenstaff

With stroke?

Bruce Cranna - Leerink Swann

Yes.

Kim Blickenstaff

Breakeven? Interesting. I don't know that we look at the sales time dedicated to it. Certainly the pricing obviously covers the cost and there's a profit left over. But we probably are expending far more resources on education and so forth than we are on any profits brought in. So it clearly would not be at a breakeven standpoint.

I think you need to get to $4 million, $5 million, $6 million probably to pay for the clinical education programs that are going on. It's really not direct selling time that drives to adoption. It's really educational processes. So it's probably going to be a year-and-a-half to get to break even.

Bruce Cranna - Leerink Swann

Thank you. Then just quickly, getting back to the POL and BNP here in the States. Sounds like you guys are signaling that maybe the time is right there or maybe it's a bigger opportunity now than you perceived it to be a quarter or two ago. I know in the past you I asked you this question, kind of curious if maybe your perspective has changed about getting a little more aggressive with giving away meters or at least heavily discounting meters in the POL?

Ken Buechler

Well, the perspective has changed because we now have CLIA waiver and that takes down a significant barrier to adoption. So we are moving, we have this initiative, we've hired new reps and we'll continue to hire more if we continue to see the traction. We don't find the need to have to discount the meters or give them away. The reimbursement is such that the profitability on a per-test basis is there and it's attractive to the accounts that we're targeting.

Kim Blickenstaff

I think there's another dynamic that we've had over the last two years as we've tried to launch this is that the growth rates in the hospital segment were so high that to sign up for the POL market where you had this CLIA impediment and you're looking at relatively smaller growth rates as what was going on in the hospital side, we had trouble keeping this group of salespeople filled because many wanted a transition over the hospital segment where they saw higher, more lucrative gains.

I think that has flipped now that we're looking at 6% BNP growth in the hospital segment and you're seeing sort of clear sailing and big opportunity and chances for 20% and 40% growth rates over that segment, I think we're going to have a lot more interest and dedication, and I think a lot of that is the CLIA waiver coming down.

Bruce Cranna - Leerink Swann

Okay, thanks again.

Operator

Your next question comes from the line of Benner Ulrich with UBS.

Benner Ulrich - UBS

Hi, guys. Just a quick question. I think you indicated that you had net adds in terms of number of accounts and BNP. Was that total accounts or hospital accounts? And if it was hospitals, is there a particular segment in terms of customer size where you saw the most adds versus maybe where you saw most of the losses?

Ken Buechler

Well, we talked about 32% increase in the number of POL accounts. An overall increase in the hospital basis in the single digits. Low single digits.

Benner Ulrich - UBS

Okay. So the net adds was in reference to the hospital accounts.

Kim Blickenstaff

Yes.

Ken Buechler

Yes.

Benner Ulrich - UBS

Okay. Did you see the majority of those adds in any particular customer segment in terms of if you break it out by size?

Ken Buechler

No. Actually, if you take a look at the new accounts that are broken out, it's about 50/50 BNP versus Bixis accounts.

Benner Ulrich - UBS

Okay, thanks.

Operator

Ladies and gentlemen, this now concludes the question-and-answer session. At this time, I would turn the call over to Chairman and Chief Executive Officer, Kim Blickenstaff for closing remarks.

Kim Blickenstaff

Just some comments on our upcoming events. We have a pretty full conference schedule here in May and June. We have the Gart conference which is going to be out in Baltimore on May 17 that we're going to attend. There's also the European stroke conference in Brussels May 15 and 19. There will be an abstract on some of the French stroke study data that is being collected.

Also we're going to do the NASDAQ biotech conference in June 21, that is in London. We're going to squeeze the Jefferies conference on June 28, in New York. Right before the William Blair conference which is June 29, in Chicago. So then we have our second quarter results that we reported on July 26. That's pretty full calendar there in the second quarter. We look forward to seeing you or talking to you on July 26, when we report those results. So thank you for being on the call today. We'll talk to you then.

Operator

Thank you for your participation in today's conference. Ladies and gentlemen this concludes the presentation. You may all disconnect and have a good day.

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