Compugen Ltd (CGEN) 2008 Q2 法說會逐字稿

Heavily accented officers; transcript is best product with the audio available at the time of transcription.

Ladies and gentlemen, thank you for standing by. Welcome to the Compugen Ltd. Second Quarter 2008 Financial Results Conference Call. (OPERATOR INSTRUCTIONS)

With us online today are Mr. Martin Gerstel, Chairman of the Board; Mr. Alex Kotzer, CEO, and Mrs. Dikla Czaczkes Axselbard, CFO.

I would like to remind everyone that the safe harbor language contained in today's press release also pertains to all contents of this conference call. If you have not received a copy of today's release and would like to do so, please contact Mrs. Dikla Czaczkes Axselbard at telephone number 972-3-765-8595.

Mr. Kotzer, would you like to begin?

Thank you all for joining our second quarter 2008 conference call today. With me are Martin Gerstel, Chairman of the Board, and Dikla Czaczkes Axselbard, who it was announced today is succeeding Runit Lerner as our CFO. I would like to take this opportunity to thank Runit for her contribution to the Company and to welcome Dikla by wishing her all the best in her new assignment.

As our longtime shareholders fully appreciate, a key continuing objective for Compugen, at this stage of its commercial development, is validation, both in terms of our growing inventory of discovery platforms and the resulting initial product candidates. Therefore, in my remarks today, I will highlight some of our recent achievements in this area. These achievements also provide some insight into the diversity of our capabilities and the important medical needs that we are already addressing.

I will then turn the call over to Dikla, who will highlight our main financial results. Martin will then discuss certain strategic issues and opportunities. After Martin, all of us will be available to answer any questions you may have.

In April we announced the successful experimental verification of two novel biomarkers that had been predicted by Immunoassay Marker Discovery Platform. The first, CGEN-144, is a novel splice variant of the known Troponin I for identification of cardiac muscle injury. The second, CGEN-438, is a novel splice variant of DLL3, a blood-based biomarker for diagnosis of lung cancer.

A few weeks later, our GPCR platform project leader presented at the Relaxin 2008 conference experimental results for three novel peptides, CGEN-25009, 10 and 11. The Relaxin peptide 01 and its family members of the assumed multi-functional (inaudible - heavily accented language) in a broad range of important indications. Therefore, our novel peptide could have therapeutic usefulness in a number of clinical indications, including (inaudible - heavily accented language) and congestive heart failure.

These were followed a few weeks later with our disclosure that we have discovered more than 10 novel targets for antibody therapy for various types of solid and hematopoietic cancer. Once again, all of these targets were initially predicted by a Compugen discovery platform; in this case our Monoclonal Antibody Target Platform.

In June, we also announced the discovery and validation of biomarkers for early (inaudible - heavily accented language) and detection of drug-induced kidney toxicity. These biomarkers have been predicted [firstly] through collaboration between Compugen and Teva.

Early this month we announced positive in vivo results for CGEN-25007, a novel peptide agonist with a gp96 protein. This molecule was initially predicted by our DAC Blocker Discovery Platform to block the disease-associated confirmation of the gp96 protein and is a drug candidate for various immune-related diseases.

With respect to a very different type of discovery platform and product candidate, two weeks ago we announced the successful in vitro and in vivo experiment and validation of the ability of CGEN-50001 to increase the activity of Tamoxifen, a frequently used drug for the treatment of estrogen receptor positive breast cancer. CGEN-50001 is a drug that has been marketed for many years in Europe for central nervous system indications such as depression, but it is not approved in the U.S.

The beneficial impact of administration of this (inaudible - heavily accented language) CGEN-50001 in breast cancer, a completely unrelated and very major medical condition, was initially predicted in silico by our New Indication Discovery Platform. In the recently completed studies, the drug was shown to increase the effect of Tamoxifen.

As was discussed in previous calls, identifying new usage for known drugs brings the advantage of well-established safety profile, which substantially shortens the clinical development program and time to market.

In addition, with respect to CGEN-50001, the fact that drug is not available in the U.S. for any indication is considered as a commercial advantage and was one of the criteria used for this (inaudible - heavily accented language) for validation. We have filed the patent for this new usage in breast cancer and have started the planning of human proof of concept studies.

In summary, we are very pleased with the success we are now demonstrating in the validation of our discovery capabilities and initial order and look forward to sharing the promising commercial opportunities that they should provide through licensing and over revenue-sharing arrangements.

With this, I will now conclude my talk and will turn the call to Dikla.

Thank you, Alex. In view of the fact that our operating financial results for the quarter and six month period are fully inline with our previous guidance, I would like to focus my remarks today on a few special items and on some of the financial aspect of our Company's business model.

First, as we have stated many times in the past, our planned primary source of revenues are future milestones and revenue-sharing payments. These will come from licensing and other arrangement covering the development and marketing of diagnostic and to our poietic products.

Therefore, as previously projected, revenues at this stage continue to be insignificant. With $40,000 revenue reported for the second quarter of 2008 and $321,000 for the six months ending June 30, 2008, there were no revenue reported for the same period last year.

The other aspect of our financial results that I would like to emphasize, again consistent with our business model, is that research and development expenses are by far our largest expense, representing approximately 70% of our total operating expenses, which totaled $6.2 million for the first six months of the year. These include non-cash items, compared with $6.1 million for the same period in 2007.

We ended the second quarter with $12.6 million in cash and cash equivalent accounts, the usage of $4.6 million for the first half of this year and consistent with our expectation.

Net operating cash usage for the remainder of 2008 is projected to be between $5.0 million and $6.0 million, which results, assuming no additional source of cash from either operating or financials or strategic transaction during the second half of this year. And an estimated $7.0 million in cash, cash equivalents and marketable securities, as of the beginning of 2009.

Evogene is a company established by Compugen in 2002 to utilize Compugen's predictive biology capabilities in the ag-bio field. We currently hold approximately 10% of Evogene's equity, which in the past was included in "Other Assets". In view of the increasing market value of our Evogene holdings, this amount is now shown as a separate line item in the Company's balance sheet. Based on the market price of such shares, our holdings were $4.6 million as of June 30, 2008, compared to $510,000 at the end of 2007.

And with this, I will turn the call over to Martin.

Thanks, Dikla, and also I would like to publicly welcome you as our new CFO. With respect to my remarks today, as usual I would like to emphasize what I consider to be the big picture. Although I realize that some of you may refer to these types in comments in other terms.

I believe that many questions we are asked by shareholders and potential shareholders can be answered by simply referring to the first few lines of our mission statement, "To be the world leader in the discovery and licensing of product candidates to the drug and diagnostic industries under milestone and revenue-sharing agreements". These few words very clearly describe our strategy, our business model and our reason for existing. They also describe an extremely ambitious mission.

However, if successfully achieved such that on a continuing basis are large number of Compugen discoveries addressing key markets would be under active development in pipelines of leading companies worldwide, it would represent a first. No company has ever accomplished this, which actually creates a problem for us in the financial world, since there really are no across the board comparables, although, of course, in each area that we address there aren't any companies that we compete with.

Also, accomplishing this mission would meet a critical unmet need in the pharma and diagnostic worlds, which is the systematic and more importantly a constantly improving capability to discover good product candidates.

And of course, from a business standpoint, this would create also a first in the form of a very highly profitable yet very low-risk pharmaceutical and diagnostic company since the high-risk and cost of failure for any individual candidate would be borne by our partners, with ours obtaining the share of revenues from all of the products that are commercialized.

Therefore, from an investor standpoint, the key question regarding Compugen is not why, but whether and when Compugen can, in fact, accomplish this mission.

Although, as I stated, no company has ever been able to do so. The three requirements for the type of discovery capability necessary to accomplish it are very easy to state. They are first, the discovery capability must be proprietary and very difficult to either copy or to find alternative methodologies. Second, it must be broadly applicable across all, or at least most, therapeutic and diagnostic areas. And third, it must be systemic, cost-effective, and most importantly continue to improve over time.

Few recognize that this lack of improvement over time, in spite of spending, cumulatively, hundreds of billions of dollars has been the key strategic problem for the pharma industry. Rather than new products getting easier and easier to create over time, as you would expect in any industry, for example look at the constantly accelerating flow of unique new products in the high tech world, in the pharma world it is exactly the opposite. The flow of truly new products continues to decrease.

It is true that since the mid-20th century products have been commercialized by the modern pharma and diagnostic industries, which have significantly improved human health and wellbeing. However, almost without exception these products were based on discoveries that were either the direct result of serendipity, right through experimentation, or likely, some combination of the two.

Since, with this type of approach, that easier things are found first, by definition productivity must continue to decrease, even as the costs grow exponentially as advanced technologies are used to attempt to increase the odds by doing hundreds or thousands or more experiments in parallel.

The result is that today we are faced with an extremely unusual situation in the pharma world.

Although the profit margins of proprietary pharma products remain the highest of any industry and the unmet needs for new products are obvious and enormous. And all the resources and capabilities needed to develop and commercialize large numbers of new products are not only available, but are actually being used and increased annually. As mentioned, fewer and fewer unique new products are, in fact, reaching the marketplace.

It is our belief that Compugen's pioneering efforts and the deeper understanding of important biological phenomena at the molecular level has now resulted in the establishment of the required discovery capability that can make a major change in this situation.

Most importantly, during the past few years, we've been able to begin to provide, on an accelerating basis, validation that our discovery capability meets each of the three requirements I mentioned earlier necessary for achieving our mission.

First, the Compugen discovery capability is proprietary and would be extremely difficult for others to duplicate, since our core ability to create discovery platforms, field after field, fully relies on our base of proprietary scientific understandings, predictive biology systems, algorithms, and other tools. And a very talented and uniquely experienced multi-disciplinary research team.

Second, the Compugen discovery capability is broadly applicable. To date, we have announced nine different validated discovery platforms in diagnostics and therapeutics, with multiple product candidate discoveries from the initial use of each.

And third, we are now demonstrating with repeat runs of our platforms that our discovery capability is systemic, extremely cost-effective and as pointed out earlier and most importantly, it continues to improve over time. Each run of an existing platform has led to additional product candidates, and with the development of each platform, additional knowledge, systems and tools become available for the creation of future platforms.

In Alex's remarks today he provided specifics, with respect to some of our more recent achievements in these areas of validation, which I believe are very impressive.

In addition, I would suggest that our shareholders follow the development of Evogene, the company that we established in 2002 to apply our predictive biology capabilities in the ag-bio world. Evogene has been independently financed and as Dikla stated in her remarks, at present we hold approximately a 10% equity interest in the company.

The reason I suggest following its development is because, in fact, absolutely final validation of predictive biology can only be achieved when you see the predicted outcome occurring in the target subject. Now, for Compugen, that means in humans. But for Evogene that means in plants and there is a big difference in the speed with which you can show this final validation, since when dealing with plants you can essentially go immediately from your computer predictions to what would be equivalent to Phase III testing in humans.

Putting plants at risk in your trials is not considered a very big problem. In any event, it is my belief that we have more than enough proof that now that we're well along on in the path to accomplishing our mission and are doing so on an accelerating basis. Therefore, I am confident that as we begin to increase our efforts to provide this growing body of proof to both the industry and to the financial community, we will see a dramatic change in Compugen's financial and strategic situation.

Thanks for listening and we will now be glad to respond to any questions you might have.

(OPERATOR INSTRUCTIONS) The first question is from Jeffrey Grossman from Berenberg Ltd. Please go ahead.

Hi, good afternoon, greetings from Amsterdam. First of all, Dikla, I want to wish you success. Congratulations on the new position. I think you deserve it and continued success and I hope you enjoy and thrive in the new position.

Question -- I don't know who might be able to answer this -- what is the likelihood of positive results resulting from a combination of CGEN-50001 with relaxofene or anastrozole for breast cancer?

Probably you are the best to answer, Jeffrey.

I guess the bottom line is, are we talking about the same pathway involving Tamoxifen, with respect to relaxofene and anastrozole.

Personally, I'm not able to answer it. We know that Tamoxifen is not the only drug used in this pathway and it was predicted to work in these specific estrogen -elated cells. But I'm sorry, I can't give you the answer, but I definitely will be able to look for it.

Should we be expecting additional announcements concerning other candidates from the alternative uses platform? Maybe I misspoke, maybe concerning the name of the platform, but alternative uses involving other existing therapeutics?

If I remember well, I mentioned even into the press release that we were encouraged by the results of this drug and we are looking for others, but the drug that we have predicted in the same discovery platform.

In our initial run we did identify a number of, actually, I don't remember the exact number that we decided to focus on and we now are evaluating some of the remaining from this initial chosen list for validation and there will be others put into validation now.

Great. Certainly we've noticed announcements, press releases on a fairly regular basis over the past six months and this is very, very encouraging. What I would like to know, however, are there additional agreements on the way. What is the level of interest of big pharma in the current product candidates and there are many of them already? I know I've asked this in the past, but I would just like to know where we stand today.

I'm not sure I know how to answer you. If I say high, do you know how to compare it to medium or to -- we have interest. We have ongoing discussions. As usual, we can't talk about it and we announce it only when/if an agreement's signed.

Yes, I think there is clearly interest by the major pharmaceutical companies in Compugen. I would take the position, at this point in time it seems like a large part of the interest relates to the very unusual capability that we have created here. In many cases the specific product opportunities that are in our pipeline now are still at a point where they're, in general, earlier than big pharmaceutical companies are used to licensing them in. But we are in discussions with a number of them now.

I think that this is -- what we're going to see happen is what typically happens in the pharmaceutical industry and that is it will take one or two major companies to sort of be prepared to be the first one to take license in a very, very early stage compound from us. And once that's seen and if assuming there's some good level of success, at least on a percentage basis, I think you'll see much more -- this happening on a more regular basis.

But we -- you can feel the increase in the interest in the industry about Compugen in general and the kinds of capabilities that we've created. It would be difficult to, I mean, almost impossible to think that they wouldn't be interested, because, as you said, we've been making these announcements almost on a regular basis. And these are in the major areas of interest of the pharma industry and the types of discoveries that we're making are quite impressive.

Let's just talk a bit about diagnostics. There you really have an edge and you're talking about Evogene and the ability to move things fairly quickly. I would think that would also apply to diagnostics. You have three agreements in existence. And is there progress being made with respect to the immunoassay diagnostics, with respect to the nucleic-acid-testing-based biomarkers? When might we see a first agreement for a cancer diagnostic?

Well, again, when you're predicting when you might see an agreement is an impossible task, but you are correct that in the diagnostic area the movement can be much quicker to commercialization. And we do have platforms here that can create many interesting targets for diagnostics, which we have been doing and have been doing some validation on our own. You're typically very limited and we have been giving, showing these to our client companies.

The only thing I can say is that, as developments happen, when it's appropriate and when it's for competitive reasons we can do it, we will make announcements.

Would you say, however, that you're satisfied with the progress being made with your immunoassay-based diagnostics with a partner for those candidates?

No. I'm not happy. I think it's been much slower than I had hoped it would be.

Okay. When might we see some meaningful milestones? Is that still a possibility this year?

That's a possibility (inaudible - background noise).

Again, you're asking questions, which makes it very difficult for us to answer. We'll definitely be glad to show these milestones when they are there.

I guess one way is we have agreements in place that if certain things happen this year, which could happen, would result in meaningful milestones. I'm not, though, suggesting -- so, yes, the agreements are there, the milestones are in the agreements, but certain things have to occur. We also say that, from a financial planning standpoint, we're not assuming any major milestones this year.

Martin, last question. Last quarter you mentioned that there might be discussions with leading financial companies concerning possible sales of a minority interest. I think you hinted at that. Is there any progress in that respect?

I'm sorry, I'm not sure I know what you're referring to.

I think you mentioned that there was interest in terms of raising capital or perhaps a solution to the Company's financial needs. There were discussions with other companies.

Oh, okay, well, I mean, we're in discussion with a number of different organizations, financial, strategic, industry that potentially could lead to something in this area. But the way you phrased your question at the beginning, I just don't -- I'm not sure I fully appreciate or understand what you were referring to. If I led anyone to believe that there is something very -- there's a specific arrangement for Compugen, which is about to occur, that was not -- I didn't intend to do that.

Okay, but you are saying there are discussions and there are many (inaudible - multiple speakers)?

Oh, of course. Yes. Obviously there are discussions that go across. Let me just say, because there are a number of them and many of them are sort of this or that type of thing, I can say there are things like mergers, acquisitions, pure financings, strategic deals. I mean, there's a whole slew of things that obviously accompany with the kinds of capabilities that we've developed and the needs that we have would be evaluating at this point in time.

Okay. Thank you very much. I'll pass it on to the next questioner.

Thanks.

Bill Chapman, Morgan Stanley.

Yes, thank you. On the toxicity market for the kidneys, have you guys decided you're going to market that directly to the pharmas or are you going to go through a joint venture format with a laboratory?

We don't need to decide. We are making efforts in all directions. I think we discussed it in the past as well and we will see what could be the best. The immediate and the easiest ways approach several big pharmas, which is their need, and see if they're interested.

But in parallel we look, as we mentioned in the past, we will look for other therapies like having an agreement with a big lab to provide the service or for using a kit that could be sort of built to be in-house, using pharmas and so on. Just -- we need time. It is just a short time since we finalized our own validation and defined these specific markers for this toxicity.

Okay. Would your target market, are we talking about dozens of companies or hundreds of companies that would have a use for this, possibly, or?

The target market, these hundreds of companies that are running preclinical studies.

Alex, could you repeat that? I couldn't hear you right.

The target market is hundreds of companies that are running preclinical studies.

Okay and then how many preclinical? Do you have any kind of range how many are done per year, thousands of preclinicals this could apply towards or I'm just curious what kind of a range?

I will assume in the range between 100 and thousands.

Okay and let me ask you where are you guys on investor relations, in terms of hiring someone?

Martin will be happy to answer this question.

Okay.

Well, as I mentioned the last time, we recognize that this is a real need. And we're in the final stages now of entering into an arrangement with a very well-known international organization that focuses solely life science, IR and has done a marvelous job for many other companies. And this, I mean, this week, next week, could be signed and I think it's fair to say they're very enthusiastic about beginning to get this story out. They recognize fully the unusual nature of what we have created here and the potential for really making a change in the pharma world.

Okay, good. Let me ask you, too, what defenses do you guys have in case someone attempted an aggressive offer for the Company?

We actually have discussed at the Board level the idea of poison pills and whatever, but in the end decided that there's always a question as to what's right for the Company versus the shareholders and management. To date we've decided not to have any of the sort of unusual types of poison pills.

I think we -- I think it would -- people close to the Company hold enough of the shares that, unless they could be convinced that it was a good opportunity, enough of the shares are in friendly hands, that it would be stopped. And if the shares that are in friendly hands believe it's the right thing to do it's kind of difficult -- I don't feel too comfortable saying they can't do it.

Okay. Well, one final question back to the kidney marker. Why would a pharma not want to license this or use this? I'm curious on market acceptance. What are your pediments?

Our function is that each pharma company that is running a preclinical study would like to know as much as they can about the potential toxicity of the marker. So, unless they don't believe in this marker or on this, they don't want to spend the money, at this stage we don't have any reason to think of why a pharma company should not use it.

We know that at the beginning it will not be used alone. They're using many ways to predict the toxicity, including surgery and things like this and the more it will be used and the more confidence they will have in these markers, it will go up and up.

Okay. Well, it seems -- this is just my comment. I know you can't comment on it, but it sure seems, according to my math, this would get you guys back to a breakeven, but, of course, the question is what kind of acceptance time lag is there. The sales cycle could be lengthy, but so that's all I have. Thank you very much.

Yes. Also, one of the things I think we should be careful about is focusing too much on any sort of one product, not from the standpoint that each individual product isn't potentially valuable or whatever.

The unique thing about our Company is the diversity and the number of opportunities that we are going after. I mention this, maybe it's just because of my history. I remember, in my prior life, dealing with a company that was working on many different projects and you never know which ones are going to be successful, which ones are not going to be successful.

The key to build a profitable, low-risk pharma company is getting enough bets on the table, because you know a lot of them are going to fail. It's just the name of the game. Hopefully, given the way we do predictive biology, that over time the failures -- the percentage of successes with product candidates coming from Compugen will just continue to get better and better.

But they'll just have higher and higher probabilities of success just because of the nature of our research. But for many, many years the strength of the Company is going to be the number of products under development, rather than any particular single opportunity.

It just takes --.

Nevertheless, I differ with you a little bit. This is, to me, a significant milestone for the Company. Your models predicted it. It tested out and that proves your models. That's, to me, a high -- it helps me increase my confidence in the ability to be accurate in your predictions.

Absolutely. But keep in mind that this is -- we've been doing this sort of field after field, platform after platform, have been validating the platforms, validating the initial products that have been produced by these or predicted and then experimentally validated. So, I mean, this is our Company and it's truly unique in our industry.

I would like to add a little to your last question. I personally believe that sooner or later, it make take a few years or many years, FDA will force the industry, will force the pharmaceutical companies to use these markers. Not only the toxicity markers, but also the genetic markers that we are working on and things like this, to make sure or to add a layer of protection for the drugs that they're reviewing and bringing to the market are absolutely safe. So I believe it's also a question of time.

Okay. Thank you very much.

(OPERATOR INSTRUCTIONS) There are no further questions at this time. Before I ask Mr. Gerstel to go ahead with his closing statement, I would like remind participants that a replay of this call is scheduled to begin in two hours, for a period of 72 hours. In the U.S., please call 1-888-326-9310. In Israel, please call 03-925-5944. Internationally, please call 972-3-9205-5944.

Before I return the call to Mr. Gerstel, we have one question from Brett Rice of Janney Montgomery Scott. Please go ahead.

There was a piece in the Wall Street Journal on July 10th describing Merck, Eli Lilly and Pfizer teaming up to launch Enlight Biosciences, which aims to speed the way drugs are found and developed. Are you familiar with what Enlight does? Is that similar or trying to do the things Compugen is doing?

Well, first of all let me say that we are aware of and familiar with this organization. As of now, what they are looking for, they're looking for technologies essentially to sponsor, so as far as I know, they're not looking to internally development stuff. And let me just say it's obvious that it's an organization that we will meet with and talk with. We have not yet, but it's obvious that it's one that we would look at.

Right. When you -- now, at least as the way the reporter reports it, these three firms invested $39 million, which is like two-thirds your market cap. It's just very curious to me that these companies are willing to commit that kind of money to something that is not as far along as you folks are. I mean, does that -- what goes through your mind when you see something like that?

No, it was just the opposite for me when I saw that. I mean, our problem, our key problem with big pharma has been one that they have been so concerned about their short-term pipelines that they haven't been willing to look longer-term and just say, "Look, this is a structural problem we have and the idea of licensing in a couple of extra Phase II drugs isn't going to solve the long-term problem of productivity. We've got to do something about it".

So just about all of the big pharmas are really shaking the tree. They're hiring people sort of in parallel to their traditional R&D organization to evaluate new approaches. They're doing things like this. This can only help us. Our biggest problem has been lack of willingness of the pharma industry to look long-term and to get involved with things at an early stage because of the short-term issues.

I think the short-term issues, now they realize the stocks have crashed. It's over for them, some of the short-term. Now they sort of are forced in recognizing since they forced -- I mean, now they have no choice and it's -- the thing that everyone is doing is sort of saying, "Okay, the short-terms are going to be some problems, but we're really going to build for the long-term". That's the best thing that can happen for a company like Compugen.

There's been quite a bit -- it's interesting. There's been quite a bit of sort of publicity now about the need for totally new approaches to pharmaceutical discovery. I mean, there's been a couple of articles in the Wall Street Journal talking about is it the end of chemistry. There actually was an article talking about that maybe all the chemicals that are useful as drugs have been found, which I hate to say it but is a totally absurd comment and in each -- you keep reading different articles.

There was an interesting article in the Fortune.com, I think it was June 23rd, I believe was the date. There was a three-page article by someone who isn't very knowledgeable about the field and unfortunately doesn't even have a college degree. But this, it was like a four-page article talking about the importance of understanding life at the molecular level and how he, for one, was going to devote a significant portion of his remaining business life to go after this problem.

Oh, the person's name is Bill Gates. You may have heard of him. I think he started a company called Microsoft and you might want to look that up. But I was going to sue him for plagiarism. He used -- all of the wording that I've been using for the last six years or whatever, he used in this article, about understanding life at the molecular level and all of this kind of stuff, but I think I'll let him be for now.

All right. Thank you.

Mr. Gerstel, would you like to go ahead with your closing statement?

Actually, let me just thank everybody for participating and I know we have some long-term shareholders on the line. Once again, every time I get a chance, even though it's redundant, over and over again I really need to thank you for hanging in there as we create and as we have created the basis for what I am confident is going to be an extremely successful company.

From the comments that Alex made with respect to some of the more recent validation and diversity of discoveries and platforms that we're now showing, I think it's becoming obvious that there's something very unusual, very unique and very powerful going on in this tiny little company. And I think we will, very shortly, be seeing it's impact on the world stage of pharmaceuticals, so thank you for hanging in there with us.

Thank you. This concludes the Compugen Ltd. Second Quarter 2008 Financial Results Conference Call. Thank you for your participation. You may go ahead and disconnect.