OpGen Inc (OPGN) 2021 Q1 法說會逐字稿

Good morning, and thank you for joining us today. I would now like to hand the call over to Megan Paul of Investor Relations. Megan, the floor is yours.

Welcome to the OpGen First Quarter 2021 Earnings Call and Business Update. At this time, all participants are in a listen-only mode. Following management's prepared remarks, there will be a Q&A session. As a reminder, this conference call is being recorded today, May 13, 2021.

Before we begin, I would like to caution you that comments made during this conference call by management may contain forward-looking statements regarding the operations of and future results of OpGen, including its subsidiaries Curetis and Ares Genetics. We encourage you to review OpGen's filings with the Securities and Exchange Commission, including without limitation the company's most recent Form 10-K and Form 10-Q for the first quarter of 2021, that may be filed with the SEC -- that will be filed with the SEC, which will identify specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements.

Factors that may affect the company's results include, but are not limited to, our ability to successfully achieve the expected synergies from the company's completed business combination with Curetis, and to implement the combined company strategy; the impact of the continuing global COVID-19 pandemic on our business and operations; our use of proceeds from the aftermarket offering that we commenced in February 2020 as well as the proceeds from recent warrant exercises and financing such as being November 2020 private placement and February 2021 Registered Direct; pursuit of FDA clearance for the Acuitas AMR Gene Panel for use of bacterial isolates and for other products and services; the rate of adoption of our products and services by hospitals and other healthcare providers in general, as well as in the current COVID-19 pandemic situation, in particular; the success of our commercialization efforts and partnering strategy; the effects on our business and existing -- of new regulatory requirements and other economic and competitive factors.

The content for this conference call contains time-sensitive information that is accurate only as of the date of this live call May 13, 2021. The company undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call, except as required by law. During the call today will be Oliver Schacht, President and CEO; and Tim Dec, CFO of OpGen.

I would now like to turn the call over to Oliver Schacht for introductory remarks.

Thank you, operator, and thank you, everyone, for joining us this morning. We're very pleased with our first quarter performance and are undoubtedly off to a strong start to 2021. We have an exciting diversified portfolio of products and a strong cash position that supports an attractive combination of product revenue and partnership growth. We anticipate a robust pipeline of activity in the months ahead and look forward to establishing ourselves as industry leaders in the molecular diagnostics and bioinformatics space, and believe we're well on the way.

On today's call, we'll begin by discussing recent business highlights as they relate to the company's core capabilities and top-line growth prospects. I will then pass the call over to Tim to review financial highlights from the first quarter as well as recent financing activities. We'll then wrap up the call with an update on the company's strategic initiatives and pipeline outlook. I wanted to start by providing an update on one of the product portfolios OpGen has previously highlighted, with an improved focus for the company. Our proprietary Unyvero platform and unique bioinformatics capabilities. This focuses on expanding the platform to include complicated urinary tract infections and invasive joint infections in the United States, with 2 upcoming prospective multicenter clinical trials for future FDA submission. Both clinical trials are anticipated to start in the second half of 2021, with the UTI trial in the summer, and the IJI trial late in the year.

We have submitted materials for a potential pre-submission meeting with the FDA for the Unyvero UTI product in the first quarter of 2021. Not too surprising, the FDA at this time, has declined to host pre-submission meetings due to the ongoing pandemic and OpGen will be proceeding without such a voluntary meeting as FDA has indicated that they would require a resubmission of such request, and then will take many months before being able to review materials in preparation of such a meeting opportunity. Given that similar products in both clinical indications using identical corresponding sample types have been successfully developed on the Unyvero platform and CE-IVD marked, and are commercially available in Europe and other markets today, OpGen does not consider the FDA's inability to conduct such pre-sub meeting to be a material disadvantage at this time.

Most excitingly, as it relates to our Unyvero platform, we announced earlier this year that we received regulatory approval from the Chinese NMPA for the Curetis Unyvero system as an IVD instrument system. OpGen's subsidiary Curetis and its Chinese partner Beijing Clear Biotech continue to closely interact with the NMPA as it continues its review of the Unyvero A50 pneumonia cartridge. The product is the first Unyvero based diagnostic application for Chinese market. A dossier for the review and potential future approval of the pneumonia cartridge was also provided. This dossier includes comprehensive data from various clinical trials and regulatory submissions of the Unyvero LRT and LRT BAL products, both of which are FDA-cleared here in the U.S., and the Unyvero HPN cartridge for hospitalized pneumonia patients, which is CE-IVD marked in Europe.

The start of commercialization by our partner, BCB, remains subject to approval of the pneumonia cartridge which is still pending. We hope to be able to provide updates on the Chinese regulatory approval process, and subsequently plan commercial launch in the coming quarters in 2021. At this point in time however, the NMPA does not provide any specific guidance or timelines for their reviews.

As I mentioned before, the commercial side of the contract with Beijing Clear Bio has been negotiated and the deal was signed several years ago. To reemphasize, there is no need to negotiate a commercial deal in China anymore, it's already in place, and it contains minimum commitments of 360 Unyvero systems at 1.5 million cartridges over an 8-year period, cumulatively adding to about $180 million in revenue to OpGen at current transfer prices in the agreement and at current euro-dollar exchange rates.

On the topic of partnership. In January, we announced that OpGen's subsidiary Curetis had entered into a distribution partnership with Annar Health Technologies in Colombia. Annar, headquartered in Bogota, is Colombia's leading diagnostics distributor and is already working with numerous renowned global IVD manufacturers. Under the distribution agreement, Annar has the exclusive rights to commercialize the Curetis Unyvero A50 instrument system and its full suite of Unyvero infectious disease diagnostic application cartridges in Colombia. The distribution agreement has an initial term of 3-years, and it can be extended in 1-year increments. In return, Annar is committed to significant minimum purchases of Unyvero instruments and application cartridges over the initial 3-year term, amounting to a total of at least 10 Unyvero systems plus significant numbers of Unyvero cartridges.

Annar is responsible for product registration, which has progressed nicely for the Unyvero platform and the entire portfolio of Unyvero cartridges during the first quarter and year-to-date in 2021. And they're actually working on an accelerated preliminary registration for the Unyvero system. Annar is committed to introduce the Unyvero product line to the Colombian market. We continue to be encouraged by this partnership, as it strengthens our commercial presence in Latin America, and is in alignment with our core commercialization of revenue growth strategy. In early 2021, as part of the launch preparation, a highly successful pre-marketing event was held at the 12th International Symposium on bacterial resistance, diagnostic stewardship and infection control from February 24 to 26, 2021 in Colombia. OpGen's session within this program where one of our key opinion leaders presented was titled - Detecting antimicrobial resistance genes to guide patient care, on February 25th.

In March, we announced the final data from the Karolinska Institute study following publication in a peer-reviewed journal. This paper highlights options Unyvero HPN product for hospitalized patients with pneumonia, demonstrating a higher diagnostic yield, than bacterial culture with a high negative predictive value of 99.8% for pathogen detection. This strong performance data, comprehensive coverage and turnaround time of less than 5 hours from sample to result, provides clinicians earlier data to inform antimicrobial decisions, especially in critically ill COVID-19 patients.

As it relates to the Unyvero product line, I wanted to highlight the outcome of our very successful and highly attended webinar titled, Pneumonia Diagnosis: Bacterial Superinfection in COVID-19 Patients, that took place in April. Professors Christian Giske at the Department of Laboratory Medicine, Karolinska Institute, Stockholm, Sweden; and Drew Bell, the Medical and Public Health Microbiology Fellow at Indiana University School of Medicine, Indianapolis, presented their independent study results from the Unyvero hospitalized pneumonia, HPN and Unyvero Lower Respiratory LRT BAL panels. Their studies demonstrated that syndromic testing of lower respiratory specimens with Unyvero HPN and LRT BAL panels can indeed improve patient care and time to appropriate targeted antibiotic therapy in COVID-19 pneumonia patients, as well as in non-COVID-19 population with a suspicion of pneumonia. The webinar highlighted that Unyvero detected bacterial pathogens up to 7 days earlier and would have been able to prompt the appropriate targeted antibiotics in 41.3% of cases and reduce time to appropriate therapy by 25.7 hours.

Now shifting gears, I would like to discuss OpGen's subsidiary Ares Genetics activity contributing to topline growth this quarter. We were excited to announce that Ares Genetics and Sandoz the number one global supplier of generic antibiotics, not only extended their collaboration within its pharma partnering program but Sandoz also added and procured another joint project in the first quarter of 2021, to assess the potential of molecular surveillance for better informed therapeutic guidance and antibiotic stewardship. The overall goal of this partnership is to develop a digital anti-infectives platform combining established microbiology laboratory methods with advanced bioinformatics and artificial intelligence methods to support drug development and lifecycle management.

As it relates to Ares Genetics in February, we announced a peer-reviewed study highlighting best practice techniques for accurate antimicrobial resistance prediction. This study focused on whole-genome sequencing data that supports harmonization of the development of good machine learning practices. This study adds to Ares Genetics' publication record, further validating our approach to becoming a globally recognized leader in the development of AI-powered next-generation sequencing solutions for infectious disease testing. Addressing the U.S. FDA action plan by developing good machine learning practice and robust algorithms will be key to moving our AI-powered solutions into clinical practice. Applying the proposed best practice techniques to AresDB, allowed us to further improve predicted performance of whole-genome-sequencing-based AST. In this context, we're currently also working with several leading clinical centers in the United States to further demonstrate the potential of accurate whole-genome-sequencing-based AST an independent validation studies.

We also received great news this quarter, relating to our work with the New York State Department of Health. OpGen announced that our collaboration using a state-of-the-art solution to detect, track and manage antimicrobial-resistant infection statewide, has expanded and extended beyond the second tier expansion phase by another 6 months through September 30 of 2021. This 6-month extension and expansion contract is valued up to an additional $540,000, which includes a quarterly retainer-based project fee as well as volume-dependent per test fees, while providing our Acuitas AMR Gene Panel isolates for rapid detection of multidrug-resistant bacterial pathogens along with our Curetis Lighthouse Software for high-resolution pathogen tracking.

We anticipate that with our innovative solutions, we'll be able to proactively identify such pathogens, leading to early intervention and potentially lifesaving treatment. This 6-month extension period gives us time to also discuss and evaluate potential future forms of collaboration with the New York State Department of Health, across the state. As of today, 4 testing centers that run the Acuitas AMR Gene Panel test on isolates, are up and running, servicing, more than 30 affiliated hospitals. We've seen significant ramp-up in testing volumes in the first quarter and into the second quarter of 2021.

I will now turn the call over to our Chief Financial Officer, Tim Dec, who will review financial results for the first quarter, and discuss recent financial developments for the business. Tim?

Thank you, Oliver. On today's call, I will briefly touch on the highlights of the first quarter, discuss our balance sheet position and review underlying growth drivers for the business. Please keep in mind that the business combination closed on April 1, 2020, therefore, Q1 2021 results include the full quarter as combined company, whereas Q1 2020 numbers are for OpGen's standalone only.

Revenue for the first quarter of 2021 was $830,000, up 34.5% from $617,000 for the prior year period. The increase is largely due to the business combination of OpGen with Curetis, offset in part by lower collaboration revenue related to our New York State project and lower FISH product revenue, with final orders processed and delivered in Q1 2021. We have now closed out the FISH business entirely, and will not generate any further revenue from this product line in Q2 2021 and beyond.

Operating expenses for OpGen for the first quarter of 2021, were $7.1 million, compared with $4.6 million in the first quarter of 2020. Since the business combination our OpEx by line item has been consistent and right on budget. R&D was $2.8 million, (inaudible) essentially flat over the last 4 quarters. G&A was $2.7 million, also flat over the last 4 quarters, and sales and marketing was $900,000, likewise flat over the last 4 quarters.

One item I would like to point out is in the other expense category. We reported a onetime, non-cash accounting charge of $7.8 million associated with the warrant inducement, which raised gross proceeds of approximately $10 million. Net loss for the first quarter of 2021 was $14.9 million or $0.50 per share compared with $3.9 million or $0.53 per share in the first quarter of 2020.

Our story has continued to resonate very well with investors throughout the remaining of 2021. We have strategically moved the company forward, by continuing to strengthen our balance sheet this quarter, by raising $34.7 million, bringing our cash position to $39.4 million as of March 31, 2021. The increase in cash this quarter was attributable to $25 million Registered Direct offering in February, a strong price point and the warrant exercise and exchange of $9.7 million in March.

Both the Registered Direct offering and the warrant exercise and exchange carry warrants at a strong strike price of $3.55 and $3.56 respectively. These warrants, along with the company's remaining capacity under its existing shelf, could generate additional proceeds of up to $37.9 million for the company if all were exercised in full. Total shares outstanding as of today are approximately 48 -- 43 million shares and the fully diluted number of shares would be 49.8 million shares.

I would like to make a brief comment on proposal 2 in the proxy statement requesting stockholder approval to increase our authorized shares from 50 million to 100 million. The Board and management thinks that it is very important that this proposal be approved. Our fully diluted share count is bumping up against the current maximum number of shares authorized. We certainly realize we might be able to access an additional $30-plus million of cash via the warrant that I mentioned a moment ago. However, the additional authorized shares would be beneficial for a number of reasons, including strategic business development efforts, corporate expansion and potential future M&A activity.

I mentioned in March that I'd be considered -- I would be considering providing additional guidance on the company. I think due to the continued challenges presented by the COVID-19 pandemic, we will refrain from any specific revenue guidance today. However, I will retouch on a few things I previously stated. I will echo my comments in March. The company continues to see growth in its Unyvero LRT, LRT BAL and UTI product lines, with 11 additional Unyvero Analyzers placements during the quarter. We continue to be very optimistic on the traction we are seeing from these products.

I also mentioned, and Oliver touched on a moment ago, that one of the company's most significant long-term growth drivers would be China. Currently, the timeline for an NMPA approval of the company's Unyvero pneumonia cartridge remains unclear. Once approved though, our partner Beijing Clear Bio has committed to a minimum purchase of 360 Unyvero systems and 1.5 million cartridges, cumulatively, over an 8-year for a time with total revenue of up to $180 million. I also previously discussed potential various licensing and partner deals. We remain actively involved on those fronts. But given the stage of negotiation, it would be prudent to assume any material deal would not happen until later in the year.

And finally, cash burn. The company took strategic and operational measures in late 2020 with the discontinuation of its FISH product line and cancellation of its Acuitas AMR urine trial. As well as moved to a smaller and tailored new headquarters facility, and lab and warehouse space to reduce its cash burn. We expect to utilize these savings in the form of prospective trials for our Unyvero UTI and IJI products in the U.S. as well as expand our investment in our Ares Genetics and A50 technologies. We expect the additional cost to offset savings from late 2020, and to have a similar cash burn pattern during 2021, of $5 million to $6 million per quarter.

With that, I'll turn the call back to Oliver to discuss additional key milestones.

Thank you, Tim. I would now like to briefly highlight some of OpGen's key upcoming milestones in our development programs and commercial activities. As stated earlier, and on previous calls, OpGen has remained in constant dialog with the FDA regarding the status of the Acuitas AMR Gene Panel for isolates 510(k) submission, despite the ongoing delays in the review of non-COVID-19 related submissions.

Last October, OpGen had issued our formal response to the agency's additional information request, which we had received earlier in 2020. Following this submission in November 2020, we received notice from the FDA indicating they would be reallocating CDRH staff from open submission to prioritize emergency use authorization or EUA requests for in-vitro diagnostics intended to address the COVID-19 pandemic. While the staffing focus on COVID-19 related EUAs within the FDA continues, we're pleased to report that at the end of January, the FDA again informed OpGen that they have formally resumed the review of our submission. OpGen had anticipated that this reallocation of FDA staff towards the review following the submission should have allowed for a near-term clearance decision for the Acuitas AMR Gene Panel. Although the FDA has recently reiterated to OpGen that it is still not able to connect to any reduce of timelines.

Recently, in the last couple of days, the FDA provided further written update to OpGen on their time lines and stated that they now, and I quote, expect to provide substantive feedback -- review feedback within 120 days of the 29th January 2021 restart of the formal review, i.e. by the end of May, 2021. And yes, we can confirm that most of such feedback has already been received to date, and OpGen has already responded to such FDA feedback without revised documents. Comments to the few remaining open items are expected in the coming days of May.

The FDA also stated that they, and again, I quote, expect to complete the review within 210 days of the review restart, i.e. that will be on or before 27th of August of 2021. However, the FDA cautions that the, and again, I quote, review completion time lines can be affected by submission complexities as well as other incoming workload and public health priorities. So again, to reiterate, this would suggest that all substantive feedback should be in by the end of May, and the FDA's completion of review and subsequent clearance decision should come on or around late August.

We're confident that OpGen has addressed all of the agency's comments and suggested edits to it's key documents, such as the intended use statement the instructions for use or package insert, electronic user guide and operating manual for Thermo Fisher QuantStudio 5 already. FDA feedback and comments to the 510(k) summary are still pending. Nonetheless, we anticipate a clearance decision at the FDA's earliest opportunity in line with the aforementioned timeline, which according to the FDA could now extend into Q3 of 2021.

While all the FDA is working towards their final clearance decision, we've continued full steam ahead with commercial launch readiness activities. We've already manufactured several batches of Acuitas AMR Gene Panel for isolates product in preparation for commercial release. In other words, our commercial team is poised for launch. We've also made further excellent progress during the first quarter and year-to-date in the final development phases of our Unyvero A30 RQ platform. We reiterate our expectation that by mid-2021, we should have a series of 10 instrument systems readily available for final verification and validation testing. We've already established several assays on the A30 cartridges, including one for SARS COVID 2, flu A and flu B, and RSV, and one assay for several AMR markers. As previously mentioned, we can confirm that OpGen continues its dialog with several potential partners for such a platform. We have received specifications for several potential products that could be developed onto such type of a system, and we believe a partnering opportunity for OpGen around the A30 platform assets may present itself in the next several quarters.

In closing, we're very pleased with our results for the first quarter of 2021, and head into the second quarter with a much stronger balance sheet and cash position and a robust pipeline of activities and a corporate strategy that supports growth across the entire portfolio. We believe OpGen is in a strong position to pursue value-creating opportunities to meet our growth and profitability targets. We're well on the way with exciting announcements, such as the extended partnership with New York State, validating peer-reviewed publications, and a prospective pipeline that includes the pending FDA clearance decision per the guidance that the FDA provided, which we outlined during this call, and a swift subsequent commercial launch of the Acuitas AMR Gene Panel for isolates in the U.S.

As always, thank you for your unwavering support, and for participating in this morning's call. I would now like to turn the call back to the operator for questions.

(Operator Instructions) Our first question is coming from the line of Yi Chen with H.C. Wainwright.

My first question is, you mentioned that there are still some remaining items that need to be addressed as requested by the FDA. Is that correct?

That is correct. I think -- the one that I specifically called out was the 510(k) summary. Now, as the name suggests, the 510(k) summary is the overall summary of all of the other documents including the intended use, the instructions for use, the user guide, etc. So what we've already done, given that we have already received and incorporated all of the other feedbacks, we've proactively already put into this 510(k) summary all of the items that we logically would anticipate the FDA to request, since they have asked for both edits, wording changes, et cetera, to be made in the other document. So once we do get their feedback on that, we should be able to turn that around very swiftly and get it back into the FDA's hands.

Got it. Got it. And assuming you obtain marketing clearance at the end of August, what would be the potential market uptake during the remainder of this year after launch?

We're obviously not providing any specific revenue guidance at this point, but the way to think about this launch -- frankly, any other similar platform launches in the rapid molecular diagnostic space, if you're targeting large academic centers and public health institutions, of which there are several hundred across the U.S., you'll likely see a wide range of annual testing volumes. This could start as low as a couple of hundred test of the year and up to well over 1,000 test per year per installation. So given our initial list price for this first-in-class and first to market broad genetic AMR Gene Panel of $175 a test, and then typical volume-based discounting and commercial model that will likely rely on on rage and rental, you can anticipate that per installation annuities, once these sites go live into clinical and commercial routine, could be somewhere in the $50,000 to $150,000 per installation.

Got it. And with respect to the collaboration with New York State Department of Health. So after September 2021, what could likely happen in terms of another extension?

When we look back, originally we had entered into the New York State Department of Health project back in 2019. It was designed to develop the platform for rapid and effective infection prevention and outbreak tracing and tracking and monitoring. The year 2, which started on April 1 last year, was designed to deliver the testing volume and the data for the New York State Department of Health to assess the impact and how to best think about the potential statewide rollout across more hospitals and more labs in New York State. Since we saw that during 2020 and due to COVID-19, testing was suspended for a couple of quarters and only restarted in fall, that's why we did the 6-month extension. And we've seen great uptake and uptick in testing volumes across all of the sites since then.

When you think about a year 3 and beyond, there is multiple potential components. One thing, obviously, we want to see the sites moving from using the research use only or RUO labeled Acuitas AMR over to the IVD clear kits once they are FDA cleared. The next thing we would anticipate adding more sites across the State of New York, and we could really get it ultimately statewide. Right now we have 4 centers Wadsworth as the New York State lab, and on a large central lab, Northwell run by -- at NYU, these 30-plus affiliated hospitals pending sending samples in for testing, One thing we've already seen here in recent weeks and months is, having added additional sites that are sending samples either to Wadsworth or to some of these New York City-based labs. But again, additional installations for additional testing sites, expanding the hospitals that are in the network, sending in specimens, and then ultimately, once this has been proven to work as a model in the State of New York, we'll be also looking at phase of potentially rolling this out to other states across the country.

So this does suggest that by the end of this year, there could be a potentially -- a formal commercial contract option in New York State.

There already is. The contract we have we have with New York State is a commercial contract, it specifies the dollar amount that they're guaranteeing as a retainer. But could there be another extension? Yes, absolutely. Our objective -- and we've done that with the year 2, which was seamless. Right after the end of year 1, we had that second year contract start April 1, without missing a beat. We did the same thing for the 6-month extension. Year 2 formerly ended March 31, and as of April 1, this year, we now have that extension in place. So our objective would clearly be to continue that relationship seamlessly beginning with the fourth quarter of this year.

And finally, do you have any visibility at this time regarding when could Chinese NMPA approve the Unyvero cartridge for pneumonia?

As we stated in the call, we do not have any visibility. We're fortunate enough that for the first time in the year, the United States FDA has finally come back with a timeline, which is robust and very specific and clear. The Chinese NMPA has so far not come back with any timeline. But again, they haven't done this for the instrument either, when there were questions that we had received and responded to back in the fourth quarter in late fall of 2020. They then went radio silent, and then in Q1 sent across the approval.

So far, we have responded to all of the request for additional data in the best way on the cartridge, we provided frankly all of the data that exists from clinical studies and trials within the OpGen Group, be it from U.S. FDA, Unyvero, pneumonia tests or from the European versions, as well as a number of external third-party studies. So we believe we've provided everything there is, but we do not have visibility on their timeline. Very similar so, there is -- very similar to the United States. They have -- timelines in general, they're similar to PDUFA timelines, but like here, they've essentially suspended those timelines.

Our next questions come from the line of Maxim Jacobs with Edison Group.

I just have one question, which you may or may not be able to answer. I was just wondering -- you mentioned that one of the reasons for the increase in authorized shares is potential M&A activity. I don't know if you could just give us a broad sense of -- if there were M&A activity, what would a potential acquisition look like?

Good question, Maxim. Obviously, at this point, there is nothing concrete or specific. So we're not at this point working on any transaction or any specific acquisition, nor have we publicly guided to any particular point. If you look at the history of OpGen though, OpGen today is the result not only of the M&A transaction between OpGen and Curetis and Ares Genetics, but OpGen historically itself have been the product of a merger between OpGen and AdvanDx. So we have a history of looking at complementary products that could be added into the portfolio, that could be a good commercial fit. We clearly strategically intend to remain focused on our core theme of fighting antimicrobial resistance.

So anything that's within infectious disease with a clear focus on AMR, and that is a synergistic fit to the product portfolio and pipeline, looking at potentially areas to strengthen the bioinformatics from an Ares Genetics based service and products, those might certainly be area to look at further future growth. And some of the acquisitions historically -- you look back at the acquisition of what has now become Ares Genetics from Siemens, was a cash-based deal. So it wasn't actually a share-based deal. Similar for the A30 platform, when we originally acquired it, it was a cash deal for the asset acquisition. It's really more of creating the flexibility and the means to potentially raise additional capital and/or strategic potential portfolio round out expansions.

Our next questions come from the line of Ben Haynor with Alliance Global.

First off for me on the Ares universal pathogen assay. I think this is the first time you guys have disclosed, at least that I've seen, that it covers over 6,000 genetic markers for AMR. That seems like potentially similar orders of magnitude above most currently available task. Can you give us a little bit more color on that assay and sum up the finer point to that?

Good spot there. Indeed, it is the first time that we have disclosed that, As the name, UPA stands for Universal Pathogenome Assay. So the goal here is really using next-gen sequencing and the full power of next-gen sequencing to bring a very broad panel that allows you to identify these genetic markers.

Now the way to think about this from a commercial rollout, this will initially be research use only, provided as a service. In Europe that would certainly be a tend in service into the Ares lab out of Vienna, Austria. Here in the United States of course, people can always send isolates across the pond, but we're likely also going to be looking at channels of bringing that assay here. And then you can imagine over time, from that universe of 6,000 markers, it could -- you could for specific questions, clinical questions you could imagine, having targeted subsets. I would say it is prudent to assume that you're not -- likely never going to take -- sorry you shouldn't say never, but not anywhere in the near future would you take a panel as broad as this through an FDA process, simply because of the daunting task from a clinical validation standpoint.

There is a reason why essentially all next-gen sequencing providers and platforms have opted for a CLIA lab route, rather than going the IVD kits and FDA clearance route. But it also sets the benchmark for the type of depth and breadth of what we're able to get out of Ares database, and launch commercially as a service offering. And to remind you, I mean there's -- this is in fact the -- the panel that we have first, pilot customers from the Austrian equivalent to the Austrian FDA, and by now, a handful of commercial customer sites across Europe. So it's definitely getting quite some interest, and we'll be -- in the coming earnings calls we'll be mapping out a very clear road map for the way to think about Ares Genetics launching and deploying its various services, starting with isolates sequencing service, going to the universal pathogen or more broadly as well as some of those bioinformatic software specific offering from -- the step in a series of launches that we anticipate making here commercially over the coming months.

Okay. On the FDA's written responses to the Unyvero UTI meeting request application, were there any surprises in there? And then, I know it's commercialized outside of the US, but is there anything with that, that hinges on the Acuitas decision? I know that's for isolates not urine-based, but just anything to be thinking about on that front.

No. So for the Unyvero UTI, we have submitted what's called a request for a pre-sub meeting. These are entirely voluntary. It's always an opportunity when you have a pre-sub meeting to get in front of the FDA. Usually, it's a 1-hour meeting, and we even proposed doing this virtually and saying, here's a handful of question that might have incrementally helped shaping the clinical trial.

Now given their priorities and given that their backlogs, it was absolutely no surprise that they said -- and all they said is, look, at this point we're not hosting any pre-sub meetings. Just not on our priority list. With no substantive feedback whatsoever, I'm not even sure they read the document and our questions. They basically said, you can resubmit, but then it's going to take several months for us to review the requests and it's likely going to be many months before we even begin starting thinking about scheduling. (inaudible) while unbalanced, OpGen had previously had a number of these pre-sub-meetings around the Acuitas urine trial.

So we've actually got the benefit of quite some color and feedback from the FDA already, and that frankly will be sufficient again, given that until last summer that was an ongoing prospective multicenter urine trial. Yes, on a different platform, but ultimately from a pathogen and AMR marker coverage, extremely similar. So no surprises there.

Also, just to expand on the FDA feedback, we did receive in writing on all of these documents for the Acuitas AMR. Not a single surprise, not a single new question. These are what I would characterize as, let's call them, clean up edits. No words missing, table formatting where the FDA had come back and said, look, we'd like you to combine 3 different genetic AMR markers that are all from the same family into one in your results report. And after we'd done that they said, yes, and then now you should combine those 3 lines in that table into one. It gives you a sense of -- they're trying to clean up the documents, format the bullet points, format the tables. You get the sense that they're just getting ready to get this out there their workload there. So again, we're confident that there's not been any substantive surprise or again, no new question, no new issue ways. It's a question of time for the agency to work through the process and work through the motions.

Okay. That's helpful. And then on the New York State, obviously, they are plenty busy, and thanks for the color earlier on on one extension could potentially look like. You also mentioned that moving this into additional state Department of Health type situation. My recollection as a while back that you guys might have had some conversations with folks -- not formally, it doesn't sound like it in other State Department of Health and such. Is there -- it is saying that it's ongoing in discussions with other entities within other states right now or is everyone still too busy with COVID to focus too much on it?

I would say general folks are probably still coming to grips with the hope -- what's hopefully the tail end of the COVID situation. Now we've certainly identified across the United States, a significant number of state and local health authorities and institutions that might very well be interesting partners and to have these types of conversations, but at this point, our focus for the Acuitas AMR Gene Panel, number one, is the FDA clearance. Number two is then converting the New York State sites that are using it to the FDA-cleared kit. Number three is to get the New York State extension. And based on the learnings -- all the lessons learned -- we're actually working very closely with all of the stakeholders across all of the sites in New York State, to also think of ways we can publish the data that's been generated throughout that 2-year collaboration project. It's going to be a blueprint and a role model showing the benefits of and the power that this type of solution can have.

And then having that data in hand and having the clear -- here's what we found, here's how it benefited, here is why we're continuing rolling this out more broadly in New York State, it's a much stronger pitch than going to any of these other states at this point. And the first question we're going to get, well, how is New York State doing with a broader rollout and stating that where are you on the FDA clearance. It's going to be a question of timing, so at this point, it would be premature to speculate on any specific conversations there.

Okay. That makes sense, regarding the sequencing of other institution. And then finally, this is open-ended, but just curious on the reaction you've gotten from some of the study results and webinars that you've hosted, the co-infection study with HPN Panel, you had the pneumonia webinar. Do you see anything of note that investors might be interested in, with regard to the reaction you've gotten from some of these things?

Again, for the pneumonia webinar we hosted, we had well over 1,000 pre-registered participants. It was really global, so I would say it was probably roughly 50:50 between U.S. and around the world. Lot of positive -- the data -- you look at a negative predictive value of 99.8%. I've been in molecular diagnostics for almost 25 years, you don't often get to see this type of data. It mathematically doesn't get much stronger than that. So lot of positive feedback, obviously number of -- as you always get -- you always attract a competitive crowd listening into these things, as you are publishing data. But also a lot of potential customers and leads and stakeholders within those sites.

So it certainly helps strengthen and broaden the funnel of commercial sales opportunities. We obviously have a number of ongoing conversations. As these types of studies -- since they are independently done, independently analyzed and presented, it's clearly validation of the performance and the clinical value potential of the platform. So it's been very positive indeed from a feedback perspective.

Okay. Great. Congrats on the progress.

Thanks, Ben.

Thanks, Ben.

That's all the time we have today for questions. I would now like to turn the call back over to Mr. Schacht for any closing comments.

All right. Thanks, everyone, for joining us today. Please visit the Investors section of our website and our SEC filings for updates on the company. Thank you very much, and look forward to keeping everybody apprised of the exciting news coming up. Thanks.

Thank you. This does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation and have a great day.