Aspira Women's Health Inc (AWH) 2007 Q3 法說會逐字稿

Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to the review of the Vermillion third quarter 2007 financial results and business progress conference call. During the presentation, all participants will be in a listen-only mode. Afterwards we will conduct a question and answer session. (OPERATOR INSTRUCTIONS). As a reminder, this conference is being recorded, Monday, November 12th, 2007. I would now like to turn the conference over to Miss Sue Carruthers, with Vermillion. Please go ahead, ma'am.

Thank you. Before we begin, let me please remind you that today's comments contain forward-looking statements that involve significant risks and uncertainties. Including those discussed below and others that can be found in our 10-K for the year ended December 31st, 2006, and in our periodic reports on form 10-Q and form 8-K. Vermillion is providing this information as of the date of this webcast and does not undertake any obligation to update any forward-looking statements contained in this document as a result of new information, future events or otherwise. Example of such forward-looking statements include statements regarding Vermillion's expectations, the timing of completion of its ovarian tumor triage tests, clinical trials, and the related submission to the U.S. Food and Drug Administration, and its TTP and PAD program plan as well as any statements regarding future operations.

Actual results may differ materially from those projected in such forward-looking statements due to various factors, including the risk that Vermillion is unable to successfully utilize resources and execute plans for its molecular diagnostics business. Investors should consult the Form 10-K for the year ended December 31, 2006, as amended and our periodic reports on Form 10-Q and form 8-K. At the request of the company, this call is being recorded. The entire content of the call including the presentation and the question and answer session that will follow are the copyrighted property of Vermillion, with all rights reserved. Any redistribution, retransmission, or rebroadcast of this call in any form without the expressed consent of Vermillion is strictly prohibited. I would like to introduce Miss Gail Page, President and CEO of Vermillion.

Thank you, Sue. With me today are Dr. Eric Fung, our Chief Scientific Officer, and Steve Lundy, our Senior Vice President for Sales and Marketing. We have made excellent progress since we last spoke at the end of August. At that time, we were celebrating both our name change to Vermillion, and the closing of a private placement which raised $20.6 million. In just a little over two months, we have made significant strides with our ovarian cancer and peripheral arterial disease diagnostic program. I want to review these achievements, and in addition, we will discuss our accomplishments and corporate development that we believe are providing the foundation from which to grow our company.

Let me describe the progress in our diagnostic programs. Turning first to ovarian cancer, early last month, as we had guided, we completed enrollment in our pivotal trial for our ovarian cancer triage test; this trial seeks to demonstrate that our tests can assist physicians in distinguishing benign from malignant ovarian tumors. This prospective multi centered clinical trial successfully collected blood samples from 550 women who were candidates for surgery to remove an ovarian tumor. This major undertaking by Vermillion represents one of the largest studies of its kind ever done in the U.S. We are now analyzing these samples to determine if our tests can accurately predict which of these tumors are in fact cancerous. Studies show that ovarian cancer patients who are operated on by gynecological oncologists survive longer and have a better chance of being cured. More over, women with cancer who are initially operated on by a non- specialist require a second surgery up to 80% of the time. Benign tumors generally require far less complicated surgeries.

We expect to have top line data results in December, and to file a submission with the FDA shortly thereafter. Our ovarian cancer development pipeline is making good head way. At this fall's European Society, for Gynecological Oncology meeting, our collaborators and we presented data showing that several of Vermillion's ovarian cancer protein biomarkers could be used to detect early stage ovarian cancer and to predict survival, two critical diagnostic needs. Ovarian cancer is the most lethal of gynecologic malignancies and the development of a reliable test for detecting early stage ovarian cancer could contribute to improving overall survival in patients. Women identified with early stage disease have close to a 90% chance of surviving five years, while survival for women diagnosed at stage 3 or 4 drops to about 40% at 5 years. For the detection of early stage ovarian cancer study, we collaborated with Dr. Robert C. Bast, Jr., and colleagues from the University of Texas M.D. Anderson Cancer Center. A biomarker panel comprising a combination of proteomic markers and C 125 was able to detect stage 1 ovarian cancer with 80% sensitivity at 98% specificity, and to detect stage 2 ovarian cancer with 88% sensitivity, at 98% specificity. Historically, ovarian cancer has been detected in early stage only 40% of the time. These discovers promise to improve the ability of blood tests to detect women with early ovarian cancer. In the survival study, researchers determined that Vermillion's 7 biomarker panel could accurately and with statistical significance predict woman with ovarian cancer who had good prognosis from those who did not.

The study used Kaplan-Meier analysis to show that women with a low panel score were significantly more likely to survive than with women with high scores, independent of the stage of the disease. We collaborated with researchers from the Oncologic Clinic Rigshospital,, University of Copenhagen, and the Danish Cancer Society on this study. Which analyzed samples from 84 consecutive women diagnosed with invasive epithelial ovarian cancer, the most common type of ovarian cancer. These data further contribute to our robust ovarian cancer diagnostics pipeline, and validation studies are underway in a larger population of women with ovarian cancer with a goal of replicating these results.

Turning now to peripheral artery disease, commonly referred to as PAD. We are developing our tests in collaboration with Stanford University to aid physicians in the diagnosis of PAD, which is a disorder affecting approximately 12 million Americans and that is under diagnosed and under treated. With the rising incidence of diabetes, the incidence of PAD is expected to increase as well. The absence of a blood test contributes to the under diagnosis of this condition. During the quarter, circulation, a major peer review cardiology journal published or initial research with Stanford, our program aims to commercialize a panel of novel biomarkers. We are working closely with Quest Diagnostics to further validate and develop a blood based assay for the detection of PAD. Our goals for 2007 and early 2008 is to further validate this test, seek additional publication of data, work with thought leaders and assist our partner Quest in preparing for test launch in early 2008.

Let me now spend a few minutes on general corporate development that I believe are fundamental to growing this business over the long term. Last week, we announced a commercialization agreement with the Ohio State University for a test to detect a blood disorder commonly referred to as TTP. We believe this license is a great example of the types of arrangements we can make going forward that will help us realize the value of the many protein bio markers we've discovered while developing this LD platform. TTP is a disorder of the blood coagulation system that in most cases arises from the deficiency or inhibition of a specific enzyme ADAMTS13. TTP can cause neurologic, renal and cardiac failure and death if it is not treated effectively. We've collaborated with Ohio State to develop a SELDI based assay for TTP, and believe that our test has improved reproducability, and sensitivity over conventional assay, we also believe this test can help physicians make the correct diagnosis, initiate timely treatment, evaluate response to therapy, and predict the risk of recurrence in patients with TTP. Under the agreement announced last week, Ohio State will provide this test as a laboratory develop test. They have already presented the assay at medical meetings, most recently at the AABB annual conference, and availability is expected imminently. More importantly, with this collaboration, we've achieved a first for Vermillion, and created a validated business model for other tests that are useful, but fall outside the current focus of the company.

I'm also pleased to announce that Vermillion has received the reissuance of a patent directed to a fundamental SELDI process from the U.S. patent office. We have received the $2 million from Bio-Rad per our original purchase agreement.

In conclusion, we are executing our strategy to become a leading provider of high value molecular diagnostics. We intend to complete the prospective clinical trial of our ovarian tumor triage test and submit the result to the FDA for clearance. We will continue to move our PAD test forward for market launch and through clinical validation studies. I look forward to reporting to you on several significant near term milestones, including top line data results from our ovarian cancer clinical trial, and validation of our risk stratification panel for PAD. We are excited about our future opportunities and believe we are continuing to establish a strong foundation from which we intend to build a significant company. We appreciate your continued confidence and support, and I look forward to reporting our achievements in the future. Operator we're now ready for questions.

Thank you. (OPERATOR INSTRUCTIONS). One moment please for the first question. Our first question comes from the line of Lenny Shimunov from Aristos Capital.

Hi, guys, thanks for hosting the conference call.

Hi, Lenny how are you?

Good, thanks. Gail could you talk a little bit about as you think about some of these initiatives, about the cash needs of the company over the next year or so, and whether, you know, about $5 million or so loss that you've reported this quarter is indicative of what we might look for over the next few quarters?

What I want to say, Lenny is I think we have demonstrated as a team our ability to manage the cash effectively, and as any growing company, we will continue to focus on that cash burn and we will adjust our spending in line with the sales and marketing activities associated with the successful launch.

So then it sounds it might creep up a little bit as we get into early '08.

I think right now, we don't want to get specific with that. What I can tell you is that again, I think we've done a very good job of moving our cash around to those items that are important for successful launch, while we've been managed to take things out of the company that are not related to the future, so there will be some movement of activities. But we cannot not spend the money, that's what it's there for. We intend to spend it exactly the right way to have a successful launch.

Okay. Thanks.

Your next question come from the line of Andrew Watts with Oaktree Capital

Good afternoon. Kind of continuing along that line, you have some short term debt now in your balance sheet, I guess there's a small piece of the original convert outstanding, what are your plans there?

Obviously, to honor our obligations. Right. So we have a certain amount of cash. We've told the street what our focus is. We have had a history so far as a management team of making sure we deliver on those objectives, and we will handle these things in line with what is appropriate. I think the important thing is to remember that we will focus, managing our cash and grow in the business in line with our availability resources and in line with the opportunities that we're addressing. We just, we're going to stay focused, and we will continue to hopefully hit our milestones.

Okay. Thank you.

(OPERATOR INSTRUCTIONS). There are no further questions at this time. I would like to turn the call back over to Ms. Page.

I'd like to thank everybody for joining us today, and for your support. We are very excited to move Vermillion forward, and we hope we will continue to create a very dynamic specialized diagnostic company, so we look forward to reporting to you again after the first of the year, thanks very much.

Ladies and gentlemen, that does conclude the conference call for today. We thank you for your participation, and ask that you please disconnect your line.