LumiraDx Ltd (LMDX) 2022 Q2 法說會逐字稿

Good day, and welcome to the LumiraDx Second Quarter 2022 Earnings Call. (Operator Instructions) As a reminder this call may be recorded.

I'd now like to turn the call over to Colleen McMillen, VP Communications. You may begin.

Hello, everyone. We'd like to welcome you to today's call to discuss LumiraDx's second quarter 2022 financial results issued earlier today. With us are LumiraDx's Chairman and CEO, Ron Zwanziger; Chief Financial Officer, Dorian LeBlanc; and Chief Product Officer, Pooja Pathak.

The press release announcing our financial results is posted on the Investor Relations section of the company's website at LumiraDx.com.

Before we begin, I would like to caution listeners that any statements we make today other than historical facts, are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Please be aware that all such forward-looking statements involve risks and uncertainties, such as those detailed in our annual report on Form 20-F for the year ended December 31, 2021, which was filed with the SEC on April 13, 2022, and other filings that we make with the SEC. Any forward-looking statements that we make must be considered in light of these factors. Actual results may vary materially.

Also during the course of today's call, we may refer to certain non-IFRS financial measures. Non-IFRS financial measures should not be considered in isolation from or as a substitute for financial information presented in compliance with IFRS. There is a reconciliation schedule showing the IFRS versus non-IFRS results currently available in our press release issued earlier today, which can be found on our website.

I will now turn the call over to Ron Zwanziger for opening remarks. We'll then provide financial and business updates before answering questions. Ron?

Thanks, Colleen. We continue to deliver on our mission and promise to transform community-based care. Looking ahead this part of the transformation, the company has 4 key priorities in the next 12 to 18 months. And I'd like to provide updates on each of these areas.

Our first priority is to commercialize our newly authorized CE product portfolio in Europe and other international markets. The second, we're progressing on U.S. revenue pipeline on 510K plan. The third, we're accelerating development of our highly sensitivity troponin and molecular assays onto the platform. And fourth, we're shaping our organization and cost base to support strong innovation and commercial success.

We've made tremendous progress on our first priority to deliver on our pipeline plan and commercialize new products in Europe. On the point-of-care platform, we achieved 5 new CE marks, including HbA1c, NT-proBNP, for congestive heart rate -- heart failure, COVID Ultra, 5-minute version of our COVID Antigen tests, the Ultra Pool tests, as well as the RSV combo with COVID. Each of these test deliver lab comparable performance in minutes on the LumiraDx Platform. We also expanded the use of CRP to pediatric populations and added an exclusion claim to our D-Dimer test.

Our focus now is to commercialize these products in Europe and also to register in key international markets. HbA1c, COVID Ultra Pool test, as well as the COVID RSP combo tests are planned to launch commercially in Q3, NT-proBNP will launch by the end of the year.

We have a compelling value proposition and are seeing early demand for these new products, which have been designed to enable our customers to consolidate 3 different instruments they are currently using into a single LumiraDx Platform and workflow right now and with the opportunity to consolidate up to 6 instruments in the next 18 months to 24 months.

In the Fast Lab Solutions, we achieved CE Mark for 2 RNA stock complete assays, the flu and COVID combination assay, as well as the Dual-Target COVID assay provide results in 20 minutes using open channel RT-PCR lab systems. We're seeing the demand for these assays, which combined speed throughput and performance to molecular.

Shifting to the United States, our second priority is to progress our U.S. revenue and pipeline. We continue to solidify the unique performance and positioning of our high sensitivity antigen test on the platform.

In the last years, several of our large customers have expanded the use of our platform. Two new locations originally designated for point-of-care molecular testing or Central Lab molecular testing with a number of others now making a similar change. This is based on our data showing molecular like performance with substantial cost savings and reflects the power inherent in the performance of our platform.

We plan to submit EUA for the COVID Antigen Ultra test on the platform shortly and are actively working on 510(k) submission. COVID Ultra followed by Flu A/B Ultra, RSV Ultra and Strep A molecular are planned to go through clinical studies during the upcoming respiratory season. This respiratory portfolio combines molecular like performance with speed at point-of-care.

With hemoglobin A1c product being commercialized in Europe, we plan to initiate U.S. clinical studies later this year and also for INR. This core product offering will enable us to consolidate much of the current point-of-care primary care offerings in the U.S. onto a single platform.

Our third priority is to accelerate the development of our component and molecular assays on the platform. During our recent Analyst Day, we were able to share the results from a method comparison study demonstrating that our high sensitivity troponin assay test correlates very well with the market-leading high sensitivity Central Lab assay. We currently are reviewing our global clinical study plan with key opinion leaders, after which we'll be in a position to initiate prospective studies.

Our molecular pipeline continues to progress well with 2 leading programs plan to complete development this year. Both Strep A and TB programs leverage our qSTAR technology, validating the performance and speed that can be achieved with a proprietary chemistry. Our Strep A and TB product design has been finalized and our plan is to start clinical studies late this year or early next year.

We recently received an additional investment from the Bill & Melinda Gates Foundation, which included funding from a commercialization of a number of our tests, including TB. We have 4 to 5 additional projects in various stages of research and development.

All this leads to our fourth priority, building the company's overall financial position. We have an exciting set of product launches in the near-term that will start to generate revenue later this year and expect rapid acceleration next year. At the same time, as COVID moves from pandemic to be endemic stage, we have a lower, but also more stable revenue place to plan with.

To allows for efficient runways to achieve pivotal milestones, we completed $100 million and plus million in financing last month and initiated a restructuring program focused on 3 main areas, the reduction of manufacturing as a direct consequence of lower COVID demand, deprioritizing a few R&D programs and a few early-stage assets, and finally, reorganization of our R&D delivery organization.

We're confident these actions will bridge us towards key revenue milestones, while delivering on our mission to improve health outcomes at lower costs through fast, accurate and comprehensive diagnostic information at the point of need.

I will now hand things over to Dorian to go deeper into our financial performance. Dorian?

Thanks, Ron, and good morning, everyone. I am pleased to summarize LumiraDx's Q2 2022 financial results.

Starting with a summary of our P&L for Q2 2022. Total product revenues for the quarter were $45 million. Revenues included $28 million of test strep sales on our point-of-care platform and $10 million from our Fast Labs molecular reagents, both of which were substantially all from COVID-19 products.

Our gross margin for the quarter was 11% compared to 17% a year ago, primarily due to under-absorbed manufacturing capacity costs, as we transitioned from a higher cost base and resize our operations to deliver in a more stable post-pandemic market environment. In addition, we incurred inventory reserves of $8 million in the quarter related to the decline in COVID demand.

Our non-IFRS R&D expenses increased 33% in the second quarter compared to the same period in 2021, primarily due to activities to accelerate the European CE Mark in the several new products within the quarter and the final development work on our Amira platform.

As we progress through 2022, we have taken measures to reduce our R&D spend, while focusing on the key priorities Ron discussed at the start of the call. Our non-IFRS SG&A expenses increased 37% in the second quarter compared to the same period in 2021, primarily due to investments in our commercial infrastructure, support the rapidly expanding customer base during the COVID scale-up and costs incurred as a publicly-traded company.

Non-IFRS SG&A expenses declined approximately $3 million from Q1 2022 and we anticipate further reductions as part of our restructuring program. The non-IFRS operating loss for Q2 2022 was $71 million, representing a $29 million higher loss compared to Q2 2021, which is primarily a result of generating lower COVID-related revenue, while still maintaining the infrastructure required for the period of peak COVID demand.

We raised $41.5 million in a private placement offering of interest in a royalty agreement with select investors in the quarter as described in our 6-K filings related to that transaction. Recently, we completed an underwritten public offering and a concurrent private placement with the Bill & Melinda Gates Foundation that raised aggregate net proceeds after underwriting costs of approximately $100 million.

We initially issued 43 million shares in the secondary offering and 14.3 million shares in the private placement. Subsequently the underwriters partially exercised the overallotment option granted to them in the underwriting agreement and purchased an additional 3.8 million common shares.

So at the end of the quarter, we had cash and cash equivalents of $106 million compared to $132 million at the end of 2021. The pro forma cash balance after the recent public offering and private placement would have been approximately $206 million.

Over the previous 6 quarters, we have invested more than $120 million in capital equipment and facilities. These investments have created sufficient manufacturing capacity, with a minimal additional investment required to install and validate new equipment to allow us to meet our internal revenue projections beyond 2025.

In addition, we exit Q2 2022 with a strong inventory position. We anticipate cash utilization to decelerate in the second half of 2022, as our capital investments have been completed and our inventory purchases are substantially reduced.

As Ron mentioned in his opening remarks, one of our key priorities is ensuring our cash position remains strong after our recent financing activities. In response to lower COVID testing activity and to ensure efficient use of our cash, we initiated a global restructuring plan to resize the organization to the current requirements to meet market needs and to reduce our overall cost basis. We are targeting our cost reductions to avoid impacting our pipeline delivery over the next 18 months.

First, we'll reduce our overall manufacturing-related operational activities to reflect both the decreases in COVID-related demand and the operational efficiencies we have realized over the last 24 months since the initial launch of our COVID testing products. In addition, with the CE Mark achieved in our Amira platform, we anticipate reduced R&D spending in the near-term for that program and we are evaluating our commercial opportunities for Amira before committing additional capital to a full launch.

We will deprioritize certain early-stage R&D activities without impacting the 2022-2023 pipeline assays. We are also reorganizing our R&D teams and several of our other teams and support functions to drive efficiency on our focus areas.

We have immediately identified reductions of $16 million in direct operating cost per quarter, including a significant headcount reduction of more than 300 roles or approximately 20% of our total full-time headcount.

As a significant portion of our operations are located in the United Kingdom, we are currently going through the collective consultation process with employees. Therefore, we expect only a minimum reduction operating costs from the restructuring activities in Q3, but we anticipate realizing substantially the full benefit in Q4 2022.

Given these cost reductions coupled with the reduced capital expenditures and inventory purchases, we believe our current cash balance is sufficient for approximately 1 year with very conservative revenue contributions from both COVID and new product launches. We will be vigilant in assessing our cash position and business performance to further adjust cash spending as required.

With the R&D pipeline delivering a comprehensive set of new products, with our global commercial footprint, with our installed base of instruments with world-class customers, with our manufacturing investments capable of rapidly scaling production of our low-cost high performance microfluidic test strip, we are well-positioned for rapid growth.

We will continue to focus on growth and we will look at additional capital sources, including non-dilutive financial arrangements, licensing of our technologies and other strategic partnerships to fund our growth appropriately. We do anticipate further activities in these areas over the coming quarters.

The customer experience with the LumiraDx Platform and our Fast Lab Solutions continues to demonstrate the value of rapid high-quality, low-cost diagnostic results. The expanding menu in Europe and the progress on key content, such as high sensitivity troponin and our point-of-care molecular tests provide exciting near-term catalysts, as we focus on rapid growth to a $1 billion revenue enterprise.

Given the pace of business activities in our current outlook on our R&D and regulatory timelines, we do anticipate reaching a run rate of $1 billion in annualized revenue now in 2025 versus our prior $1 billion revenue guidance for the fiscal year 2024. In addition, we are focused on exiting 2023 with breakeven operating cash flows, while continuing our significant investments in long-term growth.

I will now hand over to Pooja to provide some product updates as the commercial activities continue to accelerate with our new products. Pooja?

Thanks, Dorian. I would like to provide some further updates in our first priority area that Ron highlighted, which is to commercialize our CE portfolio in particular HbA1c and NT-ProBNP, as well as the global update on respiratory, including COVID Ultra and Flu RSV combo products.

First, to start with HbA1c, we see substantial opportunity for this product, estimating a global total addressable market for point-of-care HbA1c with lab comparable performance and cost to be approximately $1.3 billion, including an estimated 60% outside the U.S.

As previously announced, we achieved CE Mark for our HbA1c test both for monitoring diabetes and for screening patients potentially at risk for diabetes in May of this year. The test provides results in less than 7 minutes from a fingerstick sample.

In a method comparison study, it demonstrated 97% correlation with a lab reference method. The HbA1c test market is highly standardized with all assays meeting to be traceable through the global primary reference method. The ISCT established a global reference method in annually certifying traceability for all manufacturers.

We are very pleased that in our first-year participation, the LumiraDx HbA1c test achieved ISCT certification with less than 3% CDs in ISCT units and less than 2% CDs in NGSP units, lab comparable quality performance. We have started to work with global key opinion leaders on early evaluations and planning our European commercial launch in September.

We have also begun regulatory process in Japan, India, Brazil and South Africa, which are large existing point-of-care markets for HbA1c, but also have diabetes burden that support expanded testing. I do want to underscore that the ability for customers to consolidate 3 instruments down to single instrument is an adoption driver.

Second, we achieved CE Mark for our NT-ProBNP test in May of this year. The test is indicated to be an NT diagnosis of heart failure from a fingerstick sample with results in 12 minutes. For both D-Dimer and NT-ProBNP, due to the severity of symptoms and potential outcome, patients were very often present in the emergency department and these tests are typically ordered in the ED and run in the lab. With lab comparable results in minutes from a fingerstick sample, we see opportunity to do a lot more testing in the ED.

We also believe there is an opportunity to shift the monitoring of these conditions to point-of-care testing in primary care in cardiology. Multiple studies have shown that point-of-care testing has the potential to reduce downstream utilization and cost of healthcare, as well as improve outcomes. We are actively working with European KOLs that are passionate about this approach to implement point-of-care testing in community care setting.

Finally on the respiratory side, our COVID Antigen test continues to be recognized by customers for its performance, speed, and usability. We had excellent engagement with customers and KOLs at [AE] this year, including a customer presentation that outlined results from the 24-month study, evaluating COVID detection rates across lab PCR, the LumiraDx microfluidic antigen test and lateral flow test. The LumiraDx COVID test demonstrated comparable performance to lab PCR, while the lateral flow test had substantially lower detection rate.

As announced, we CE Marked the COVID Ultra test in Q2, which provides high sensitivity results in 5 minutes. We plan to start shipping product in the next few weeks and are also submitting an EUA to FDA shortly.

We also CE Marked Flu and RSV combination product with COVID in Q2. Customers in Europe and Japan are conducting evaluation for the Flu and COVID combo, and we are preparing for demand in the upcoming flu season. The RSV and COVID combo will start shipping next month.

With that, we would be happy to take your questions. Operator?

(Operator Instructions) Our first question comes from Vijay Kumar with Evercore ISI.

One, maybe on the restructuring here, Dorian, with the headcount reduction, can you quantify what the OpEx spend rate should be? It looks like Q4 should be a more normalized level and what the cash burn rate implications are?

Yes. So there's 2 components to the cash burn rates, Vijay, as I mentioned. One, the reduction we anticipate $16 million of operating costs and that will come from the fixed costs within cost of sales to come from R&D and it will come from SG&A. So it will come from all 3 of those lines in the P&L, so that's about $16 million of cost per quarter. And as I said, we expect to realize that within Q4.

And probably, if you're looking at the last 6 to 18 months, the larger impact will be from the lack of capital expenditures now that the manufacturing build is complete. And also, as we work down the working capital, we're exiting the quarter with $169 million in inventory. Most of that is in instrument components and other things that will have the ability to place over a period of time and won't have the cash outflows associated with replenishing that at the same rate.

So we anticipate the working capital and the CapEx to be even larger drivers of reduced cash outflows.

And did I hear you correctly, Dorian, on you expect 2022 to be capital neutral?

We expect to exit 2023 at operating cash breakeven.

And Ron, maybe a couple of questions for you. One, I think in your prepared remarks, you mentioned you expect non-COVID assays to ramp up in the back half or exiting '22 and a more meaningful ramp into 2023. Could you just remind us what those assays are, with the restructuring, did any time lines get shifted here? I don't think so, but just wanted to check the box.

No, they haven't -- in regards to the platform, they haven't. We've been very careful that as part of this restructuring to make sure that the key tests, which enable us to consolidate from a customer's perspective initially, what they might -- what they may be using on 3 instruments down to 1 is not affected. And also, we haven't expected the major tests that are due to launch in the next 18 months. So as far as the platform is concerned, there has been no -- we've been very careful not to do that.

And then sorry, just on the revenue ramp expectations for non-COVID assays. Can you just give us a little bit of flavor on what your customer feedback has been? And maybe Pooja can chime in as well. And what kind of assays do you expect to see revenues to ramp up significantly in '23?

Well, we haven't quantified it, Vijay. But customer feedback from every part of the world is about wanting additional tests on the platform. And it's the test that, of course, we have in development because the test we have in development were essentially pre-agreed with the major customers around the world in the first basis as to what they would want. But now that we have several of them out there, and in particular, some of the new ones coming such as A1C and NT-Pro in addition to the sort of the CRPs and D-dimers, that we already have there, plus, of course, the respiratory ones 2A/2B, we are getting requests pretty much everywhere.

We're expecting significant response, to the A1C customers pretty much everywhere are asking for it. And this notion of a single platform, it clearly will help carry some of the other tests that we already have. So we should see some fairly serious acceleration of revenues as we worked our way through '23.

So to repeat the question that you asked Dorian, we expect to get to breakeven by the end of '23, not during '23, at the end of '23.

Understood. And maybe a bigger picture question for you, Ron. And the Dorian sort of reaffirmed the LRP of $1 billion revenues in 2025. Can you just remind us on what the $1 billion contemplates in terms of endemic COVID respiratory revenues versus non-respiratory revenues? And what gives you the confidence, that's a pretty steep ramp when you look at diagnostic end markets getting to $1 billion, that's a big number. So talk us about what gives you the confidence?

Just to clarify, we spoke to getting to that run rate within 2025 of the $1 billion, so kind of exiting 2025 with that run rate. I think we still see a similar view on endemic COVID as part of the overall respiratory offering. And we've previously said that we expected that to be between 15% and 20% of that size of revenue in that side of our business going forward. I don't think our views have really changed on COVID, flu and other respiratory testings making up about irrespective of the total revenue on a go-forward basis.

In fact, Vijay, that number that we gave of that estimate is a year old when obviously, knowledge of the endemic was much less understood. But now the way it's unfolded, we have a lot more evidence of sort of the endemic phase. We're seeing sort of a lot of transition. And it may not be entirely apparent from our numbers, but our revenues on a monthly basis since March, including up to the present into August have been remarkably steady. And that's sort of reflecting the endemic stage of the pandemic now and I'm not trying to predict the future here.

But the real point I'm making since you asked about the breakdown, I think that that estimate, which I think is quite modest to be down for respiratory to be 15% to 20% of our platform revenues, which we talked about over a year ago, I think now we probably have more confidence in that estimate. Of course, it's still an estimate now, but I think we have more confidence around it now.

If I may squeeze one more in, apologies for the questions here. On the Strep A and TB studies, I think I heard you mentioned late 2022 start, early '23 start. Did I hear you correctly that the assays have been locked? And how long are these clinical trials, especially on the TB side, how long are these studies in general? And how do you see the revenue opportunity? I couldn't help observe what the private placement by the Gates Foundation, and they're pretty big supporters of these kinds of tests. So maybe talk about the opportunities on the TB side.

Well, I mean, people sort of underestimated. I think the potential is quite large. And you're right, the foundation which have supported us in different ways over the years, including a significant uptick in our recent financing are very keen to help us. And I'm sure they'll find various ways to help us get the product established.

And sorry, is that -- when you think about the adoption for tuberculosis, is that a tender process? And is the Gates formulation going to support you guys for, any thoughts on the commercialization of the TB assay?

Well, I won't go into what might happen. I mean it's self-evident. If you look at the number of different arrangements we've had with the foundations over the years. But I won't speculate on what might happen in the future.

I think what you should focus on, Vijay, as to the outlook is the relative performance of what we do in general, both relative to the competition and also relative to the actual market need, the ability to have a community-based high-performance TB test obviously has immense value. And because of our cost structure, it also happens to be beneficial for us as well.

Our next question comes from Jeffrey Cohen with Ladenburg.

Just a couple from our end. Ron, you had mentioned some exclusion criteria in the D-dimer test. Could you clarify that?

Pooja, do you want to take that?

Just to clarify, I think the comment that we made was that the D-dimer test recently can now be used to exclude VTEs in combination with the pretest probability score. So it's just an additional use case for the product that not only can it be used to aid in the diagnosis of a VTE, but it also can be used to with confidence rule-out. And the clinical value of that is that there's a lot of downstream cost of patients going to the emergency room and utilizing -- requiring ultrasound. So it's just an additional use case. Is that the question you're asking?

Yes, that's perfect. And congratulations on HbA1C and BNP and with CE Marks. Could you walk us through how that may roll out in the back half of the year as far as commercialization efforts and some territories perhaps in CE?

Well, in non-Europe, we've got a number, as we mentioned, a number of regulatory applications that we are focusing on a combination of high-burden countries in diabetes as well as sort of regulatory, which can be achieved relatively quickly.

But in the back half of this year in terms of our focus -- our actual focus given that we have the regulatory -- we've met the regulatory needs in Europe. We're very much initially focused on A1C and secondly, on NT-Pro. And we're gearing up for both of those through key opinion leaders, the usual approach and the excitement level in the commercial organization is sky high because they're getting such great feedback from customers.

That's very helpful. And then, one more from our end. I guess for Ron, if you could talk a little bit about the U.S. market as it currently stands and a number of placements and locations and then talk about how iron-ore and hemoglobin studies will play out in anticipated duration and rollout of this test.

Well, we don't expect those tests to be until well into next year. But the installed base we have, you may recall that when we first started because of our relationship with CVS, we've gone off to a fairly fast start simply because they have a large number of locations. But since then, the installed base in the U.S. is now to the point where it's pretty much parity between the locations in health systems and community care. So we have quite a spread of now of our installed base across the U.S., both obviously in the retail setting, but also in health care systems.

(Operator Instructions) Our next question comes from Mark Massaro with BTIG.

I didn't hear -- or at least I don't think I heard an update on the installed base of Lumira platform. So I think you exited -- are you finished Q1 at around 25,000? How many did you place in Q2? And just by looking at the numbers, did Instrument revenue come in somewhere in the $6 million to $7 million range for the quarter?

The installed base is roughly the same. Dorian, do you want to take the question?

Sure, yes. The installed base is relatively the same, Mark, for the calculation you're trying to do to get to the revenue that's not from test strep and from Fast Lab. Please remember that we have the distribution revenue from the acquired distribution businesses we have and that makes up the bulk of the remaining $6.5 million of revenue outside of Fast Lab and the test strep. So there was minimal instrument revenue in the quarter.

Okay. How should we think about the pacing of instrument placements going forward? So obviously, with the COVID situation going from pandemic to endemic, should we think of that more flattish? And then at what point do you see another inflection -- perhaps, is it the HbA1c or maybe walk us through which assay or assays may start moving the needle again on instruments?

It's clearly the case that A1C is going to drive short-term placements. And so we should start seeing from the sort of the customer feedback that we're getting fairly significant placements for A1C and really accelerating into Q1 and beyond. And then NT-Pro will also take over. And I don't want to confuse message by digressing a bit. So that's where the growth will be coming from -- the replacements will be non-COVID.

But having said that, we've had a number of inquiries from COVID customers, who actually are looking to change their behavior away from other testing that they do. And so we actually may get COVID placements to replace others because of the nature of our platform because it offers the multiple tests on the same platform.

And the COVID Ultra, the 5-minute test is proving to be extremely attractive in peoples' work, in customers' workflow. So actually, we may even -- based on sort of quite a lot of recent feedback. We may end up with strange as it may sound more placements on COVID as well.

Okay. I want to clarify the comments on the headcount reductions. So I think I heard 20% overall. And at the Analyst Day in New York, I believe you provided updates. I think you have roughly 200 or so salespeople and sales in 27 countries -- or I should say sales reps in 27 countries, sales in 100 countries. Do you expect any impact on the sales and/or marketing organization or are you largely limiting this to manufacturing and R&D?

It's latter. We've also -- given that we're doing an overall review, there is some change, but the majority is on the R&D, the manufacturing and R&D.

Okay. And then maybe Ron or Pooja, can you clarify the comments on the Amira platform? I think I heard a reduction in R&D expense and perhaps putting that on pause. Maybe walk me through what you mean by that? Are you evaluating whether or not Amira will be a key part of Lumira's future? Or is this just largely a near-term pause for cash preservation purposes?

It's the latter. And we've also had inquiries about from others about how -- about ways of using it. So we're just sorting out a new business plan case for us.

(Operator Instructions) There are no further questions. I'd like to turn the call over to Ron Zwanziger for any closing remarks.

I'd like to close with a customer update, which actually somewhat relates to the last question we just had. One of our European customers, a major European customer who currently used for COVID testing, PCI lateral flow and our microfluidic platform, just told us that they will be stopping all COVID testing with PCR and lateral flow completely. And they're using and they're moving to using our platform exclusively.

They plan to order the COVID Ultra, the 5-minute test once available. They're starting to use their hemoglobin A1C testing. And in addition to all of this, they're expanding their POC testing program into new geographies.

This is just one of the many examples we have of customers that are delighted with our product performance and choosing to expand and convert testing to our platform. This is transformation of community-based care today happening right now.

Thanks again for your questions and for joining our call today.

Disconnect. Everyone, have a great day.