OPKO Health Inc (OPK) 2017 Q1 法說會逐字稿

Hello, and welcome to the OPKO Health Business Update Conference Call. (Operator Instructions) As a reminder, this call is being recorded today, Tuesday, May 9, 2017.

I would now like to turn the conference over to Ms. Anne Marie Fields. Ma'am, you may begin your conference.

Thank you. Good afternoon. This is Anne Marie Fields with LHA. Thank you all for joining today's call.

I'd like to remind you that any statements made during this call, other than statements of historical fact, will be considered forward-looking and as such will be subject to risks and uncertainties that could materially affect the company's expected results. Those forward-looking statements include, without limitation, the various risks described in the company's annual report on Form 10-K for the year ended December 31, 2016, and its subsequent filings with the SEC.

Before we begin, let me review the format for today's call. Steve Rubin, OPKO's Executive Vice President, will provide an update on the company's various businesses and clinical programs, followed by Adam Logal, OPKO's Chief Financial Officer, who will review the company's 2017 first quarter financial performance. Dr. Philip Frost, Chairman and Chief Executive Officer of OPKO, will provide closing remarks, and then we will open the call to your questions.

Now I will like to turn the call over to Steve Rubin. Steve?

Well, this is Dr. Frost. Before Steve Rubin and Adam Logal talk about the company and this quarter in a more granular way, I'd like to give you a

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(inaudible) all experienced professionals who would be rated among the best by any standard. They joined an existing dedicated team. Together, they position us to launch forward with new products, greater revenues and more profit.

We've been investing in new systems of every sort that will result in better financial data that will give us more information about our customers, our products, our sales team and very important, will permit better collection of receivables.

For GeneDx, this means we'll be able to gather and store and analyze sequencing information to provide new services for a better patient diagnosis, more family genetic information and more success with our marketing and sales effort. We're now ready to...

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On the [computing] side, we will be very aggressive with our efforts to make Rayaldee the huge commercial success it was meant to be. Rayaldee is an effective and safe product that will help manage the...

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Large market. Our agreement was before these certain world markets opened and we are now pursuing licensing deals for these regions.

We're mindful of our commitment made to our shareholders, our partners, our employees and to our patients. We have repeatedly pointed to our strategy to provide important medicines for which there are large potential markets and which OPKO can develop in a financially prudent way...

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(Operator Instructions)

Okay, this is Dr. Frost. Before Steve Rubin and Adam Logal talk about the company and this quarter in a more granular way, I'd like to give you my view of where we are.

We have a large diagnostics laboratory, Bio-Reference, of which we're very proud. So much so that we've decided to invest heavily in its future. We restructured management with a new CEO, Dr. Greg Henderson; a new COO, Warren Erdman; a new genomics division head, Dr. Ben Solomon; and a new Director of sales for GeneDx, [Vicki Loughman]. All experienced professionals who would be rated among the best by any standards. They joined an existing team of dedicated leaders. Together, they position us to launch forward with new products, greater revenues and more profit.

We've been investing in new systems of every sort that will result in better financial data that will give us more information about our customers, our products, our sales team and very important, will permit better collection of receivables.

For GeneDx, this means that we'll be able to gather, store and analyze sequencing information to provide new services for better patient diagnosis, more family genetic information and more success with our marketing and sales effort. We're now ready to go to the next level.

The 4Kscore test is being marketed and sold through Bio-Reference, but our urology team has been busy designing and performing new trials to even further document the unique value of 4K to identify men with serious prostate cancer. These trials will, of course, result in more publications, presentations at medical meetings and more and better tools for our marketing and sales effort.

My goal for the year is to increase sales of our 4K tests in a very meaningful way.

On the therapeutic side, we will be very aggressive with our efforts to make Rayaldee the huge commercial success it was meant to be. Rayaldee is an effective and safe product that will help manage the increasingly large number of patients with chronic kidney disease. The new kidney disease improving global outcomes guidelines soon to be published will be very helpful in that they discourage the use of our main competitive products.

Our partner, Vifor, is a sophisticated world leader in the field of neurology medicine and they are moving fast to obtain approval to sell Rayaldee first in Europe, and then in other markets for which we have licensed them.

At the same time, we are jointly getting ready for clinical trials to prove the value of a different dosage form of Rayaldee for dialysis patients, another large market.

Our agreement with Vifor leaves certain world markets open and we are now pursuing licensing deals for these regions.

We are mindful of the commitments made to our shareholders, our partners, our employees and to our patients.

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Phase II trials in children were successfully completed and we recently initiated our Phase III pediatric program.

In adults, as you will hear from Steve, our Phase III trial results require a bit more analysis before submitting, with our partner Pfizer, a BLA to the FDA for product approval. No guarantees, but we're confident.

The second example is our OPK88003 selected androgen receptor antagonist which we are developing to treat benign

prostatic hypertrophy, BPH or enlarged prostate, common in men as they get older.

In studies of 350 men, it decreased body fat while increasing muscle mass. As it's been shown to significantly decrease prostate size in dogs, we plan to begin clinical trials this year to demonstrate and confirm its usefulness to treat BPH.

The unique properties of this drug, if approved, give it potential blockbuster status. Again, no guarantees but the need for such a product is great and we can afford to bring the program to fruition.

I'll say what you already know. We will work hard to deliver on our commitments. Now I'll turn this over to Steve

Thank you, Phil. During the first quarter of 2017, OPKO made important progress, and we are pleased with our U.S. launch of Rayaldee to treat secondary hyperparathyroidism or SHPT in patients with Stage 3 or 4 chronic kidney disease or CKD and vitamin D insufficiency.

Rayaldee is the only FDA approved product for this indication. We launched Rayaldee in the U.S. at the end of November 2016 and have built a solid marketing and sales team of 50 professionals.

Dr. Akhtar Ashfaq has recently joined OPKO as Senior Vice President, Clinical Research & Development and Medical Affairs of our Renal division. Dr. Ashfaq was previously with AstraZeneca where he served as Executive Director and head of the CKD program within Global Medical Affairs. Before that, he served as a Medical Director for Amgen.

We are pursuing an aggressive marketing and sales effort as we continue to add new payers. Over the first quarter, the number of physician prescribers for Rayaldee is up eightfold. The soon-to-be published KDIGO guideline for the treatment of chronic kidney disease, metabolic bone disease, is expected to recommend against routine use of vitamin D receptor activators or VDRAs, to treat SHPT in Stage 3 and 4 CKD highlight the unproven effectiveness of vitamin D supplementation.

As these presently represent the only competitive products, Rayaldee use should be greatly enhanced.

Moving forward, we plan to leverage our investment in our Rayaldee sales force and commercial infrastructure, and we will advance our clinical plans in a number of important programs.

First is the final Phase III clinical study for Fermagate, our magnesium-based, calcium-free phosphate binder for hyperphosphatemia in CKD patients on dialysis, already shown to be safe and effective in treating hyperphosphatemia in Phase II and Phase III trials.

In preparation for the upcoming Phase III trial, we are completing additional animal studies to confirm Fermagate's ability to limit vascular calcification, the leading cause of morbidity and mortality in CKD patients.

Next is the Phase II clinical trial of a higher strain of Rayaldee for hemodialysis patients, which we plan to adopt in collaboration with our partner, Vifor Fresenius. This study should begin as soon as we reach agreement with FDA on the trial design expected later this year.

In addition, Vifor Fresenius continues to advance its marketing applications for Rayaldee in Europe, Canada and Mexico as a treatment for SHPT in Stage 3 and 4 CKD patients.

We have other important product development programs underway. Let me start with an update on our long-acting human growth hormone product, hGH-CTP, partnered for worldwide commercialization with Pfizer.

Late last year, we reported top line data from the multinational, multicenter Phase III study in 198 adults with hGH deficiency. The primary efficacy endpoint of that study was mean change in truncal fat mass. While we reported that the study did not meet its primary endpoint, it did meet the secondary endpoint of IGF-1 normalization with 97% of the hGH-CTP subjects versus only 6% of the placebo subjects achieving IGF-1 normalization. This biochemical marker indicates the activity of human growth hormone in this population.

The safety profile of hGH-CTP in our study was consistent with that observed with patients treated with growth hormone injected daily.

We continue to validate and conduct QA and QC analysis of the data from the Phase III study as part of the routine work to support the forthcoming BLA submission. This is a time-consuming process given the large number of study sites and geographic footprint. Frankly, more time-consuming than we had anticipated. Completion of this work, however, is imminent, and upon completion, we will carry out an official outlier sensitivity analysis of the data.

Since the completion of the pivotal phases of the Phase III adult hGH-CTP in August 2016 and Phase II pediatric hGH-CTP in July 2015, a significant number of patients have continued in the open label extension, or OLE phases, pending drug approval. Patients in the pediatric study are well into their third year of treatment with long-acting hGH-CTP. To date, over 18,000 doses of hGH-CTP have been administered to patients and no serious safety concerns have been reported. Plans to switch from delivery with a syringe to injector pens for the patients in the above mentioned OLE studies are progressing, and we expect all patients will be using the pen devices by early first half of next year.

We are confident about the outcome of the adult growth hormone deficiency study and continue to expect to submit a BLA for FDA approval on hGH-CTP in adults by the end of this year.

Moving on to our pediatric hGH-CTP program. We continue to enroll subjects in our global pivotal Phase III study in 220 pre-pubertal growth hormone deficient children, which is evaluating a single weekly dose of hGH-CTP versus daily injections of currently marketed growth hormone. We plan to begin our pediatric hGH-CTP registrations in Japan in the third quarter of this year.

The pediatric segment represents approximately 80% of the market for treatment of hGH deficiency. I note that the primary efficacy endpoints for treating adult growth hormone deficient patients is reduction of trunk fat mass. This endpoint is quite different from the primary endpoint for treating pediatric growth hormone deficient patients, which assesses growth height velocity. Data from our pediatric hGH-CTP Phase II study affirmed that single weekly injections of our drug has the potential to replace daily injections of currently marketed growth hormone in pediatric patients.

We are satisfied with the progress of these late stage programs as we move toward commercialization. This is an area with a significant and growing market opportunity, and we believe, through our partnership with Pfizer, that we will be able to take a leadership role in growing and capturing market share.

Let me now update you on our long-acting Factor VIIa CTP for the treatment of bleeding episodes in hemophilia A or B patients with inhibitors to Factor VIII or Factor IX.

We are nearing completion of a Phase IIa dose escalation study of intravenously administered Factor VIIa-CTP to determine safety and explore efficacy endpoints in 24 patients in the United States. A Phase I study of subcutaneous administration of this drug in healthy volunteers is ongoing. We expect to have the safety information by year-end.

Manufacturing scale-up to produce efficient drug products for the long-term toxicology and upcoming pivotal efficacy and safety studies are progressing as planned.

Let me now turn to OPK88004, a once daily, orally administered selective androgen receptor modulator or SARM, to treat men with BPH. This compound demonstrated a significant decrease in fat mass and increased muscle mass and a lowering trend in PSA levels in a Phase II study in 350 males subjects. We plan to initiate a Phase IIb dose ranging study in the second half of this year to evaluate the effects of OPK88004 to reduce prostate size and provide anabolic therapeutic effects in men with benign prostate hypertrophy, or BPH, which is an enlarged prostate. This is a significant opportunity for us. BPH is common in aging men affecting over 50 million men in the United States. BPH is 1 of the 10 most common and costly diseases in men older than 50 years of age in the United States.

We are continuing to progress our other late stage pipeline products, including OPK88003, our once weekly, dual GLP 1/glucagon agonist, for which we will undertake a Phase IIb dose escalation study to evaluate weight loss and glucose control.

Data from a Phase II study of over 420 subjects with type 2 diabetes showed OPK88004 was significantly superior in weight loss compared with the currently approved extended release Exanetied and placebo, and also demonstrated a similar reduction of hemoglobin A1C, a recognized marker of sugar metabolism.

During the first quarter, we made progress with our AntagoNAT, our anti-Natural Antisense Transcripts, an Opko platform technology in which single-strand oligonucleotide molecules are designed to interfere with regulatory gene expression in order to enhance production of endogenous functional proteins. We've recently received U.S. and EU orphan drug designation for AntagoNAT.

OPK8801 for the treatment of Dravet Syndrome. A majority of Dravet Syndrome patients are reported to have a mutation of the SCN 1A gene, which results in a severe, intractable form of epilepsy that begins at a young age of 3 to 6 months old. We are near to filing an IND for Phase II study of this drug in the United States.

Turning now to our diagnostics and laboratory business. Bio-Reference Laboratories continues to post steady financial progress with the bulk of revenue coming from traditional reference lab testing along with growth of our 4Kscore tests. We continue to build a foundation for the positive reimbursement of the 4Kscore test and, last year, the American Medical Association granted a CPT 1 code for 4Kscore effective as of January 1, 2017. The CMS national approved rate for 2017 for 4Kscore is $602.

Novitas has been paying and continues to pay 4Kscore Medicare claims. In addition, 4Kscore is included in key prostate cancer guidelines such as the 2016 National Comprehensive Cancer Network U.S. and the 2016 European Association Urology Prostate Cancer Guidelines.

To date, we have a number of positive regional coverage decisions with commercial payers with pricing agreements in place.

As we've previously reported, Novitas Solutions is the Medicare administrative contractor or MAC that matters to 4Kscore as it is responsible for New Jersey where our Bio-Reference lab facility is located. All 4Kscore blood samples are sent to that facility and all test processing takes place there regardless of where the patient resides.

Over 8,600 prescribers have ordered the 4Kscore test, and over 18,600 tests were performed through the first quarter this year, which represents growth of more than 100% from the first 3 months of 2016.

We have successfully completed a second prospective blinded clinical trial involving Veterans Affairs Hospitals across the United States.

The 366 patient cohort was compromised -- comprised predominantly of African-Americans. Prostate cancer disproportionally affects African-American men, with the highest prostate cancer rate in the world. The 4Kscore was shown to accurately identify risk of high-grade prostate cancer disease in this cohort. A podium presentation of the results of the study will be presented at the upcoming annual meeting at the American Urological Association in Boston on Tuesday, May 16 at 10 a.m, along with several other podium and poster presentations presented at the meeting involving the 4Kscore.

Additionally, investigators involved in the U.S. validation study have submitted a manuscript based on analysis of patients in that study, who, on biopsy, were diagnosed with low-grade or Gleason 6 cancer and went on to have a radical prostatectomy. The analysis demonstrated that the 4Kscore was a significant predictor of cancer upgrade. In other words, from Gleason 6 to Gleason 7 or higher as confirmed upon radical prostatectomy.

Moving now to the Claros 1 point-of-care system, our novel system to provide rapid high performance blood test results at the point of care. Claros 1 can run immunoassay tests in the physician's office or hospital nurses station using a single drop of blood, negating the need for a full blood draw sent to a centralized reference laboratory. We expect to report precision data for our first test, Claros 1 PSA, at the American Association of Clinical Chemistry Meeting in late July, early August. We plan to submit a PMA with the FDA in the second half of the year for our Claros 1 PSA test. We plan to utilize Bio-Reference labs marketing, sales and distribution resources for the launch of the Claros 1 PSA test in the United States. We continue to develop other Claros 1 tests and testosterone's next in line for submission.

GeneDx, our high-value genetic testing unit, has been very active. In March, we had a prominent presence at the American College of Medical Genetics and Genomics Annual Meeting, where we presented in 14 poster and 4 platform presentations about exome sequencing and other genetic testing in a variety of diseases.

To further expand our clinical and genomics program, full genome sequencing will be offered to clinicians and research programs.

Exome sequencing options will soon be offered to healthy individuals who, because of family history, fertility or pregnancy or more general marginal concerns, would like to have more genetic information about themselves.

During the first quarter, our Gen Path women's health subsidiary introduced Claritest, a noninvasive prenatal test or NIPT initially is to be performed Illumina on the Verify platform. And IP testing has become a valuable addition to prenatal care. We are pleased to offer the most technically advanced NIP test available on the market.

We continue to expand our suite of services at GeneDx as a leader in innovative genetic testing. As part of its comprehensive test menu growth, GeneDx will be offering pharmacogenetics testing which examines genetic changes that affect how people process certain prescription medicines. GeneDx' menu also now includes rapid whole exome sequencing for critically ill patients where results will immediately impact management as well as prenatal whole exome sequencing.

So in closing, we are pleased with the progress we've made across all business segments these past 3 months. In particular, our growing revenue should provide an increase in cash flow that helps fund our commercial efforts and product development.

Our objectives moving forward remain consistent: continue to increase revenue from our diagnostics business; increase contributions from new products; step up the utilization of the 4Kscore test; expand our GeneDx business; and advance our development programs towards commercialization.

Throughout the balance of the year, we expect to achieve a number of important clinical milestones. These include: data readouts for the sensitivity outlier analysis of the Phase III adult hGH-CTP clinical trial and BLA submission; initiation of the Phase II study of Rayaldee for the treatment of dialysis patients; submission of a PMA filing for a Claros 1 PSA point-of-care test; and a 510(k) filing for a Claros 1 point-of-care testosterone test; initiation of a Phase IIb study of OPK88004, our once daily oral selective androgen receptor modulator or SARM, in patients with BPH or enlarged prostate; initiation of a Phase IIb study of OPK88003, our once weekly dual GLP1-Glucagon agonist, to evaluate weight loss and glucose control; obtain data from the Phase IIa study of Factor VIIa-CTP IV formulation and from the Phase I study of Factor VIIa subcutaneous formulation; initiation of a Phase IIa clinical study of our NK-1 inhibitor for itching in dialysis patients; and initiation of a Phase IIa study of OPK8801 for the treatment of Dravet Syndrome.

We look forward to keeping you appraised of our progress with all of these programs. Let me turn the call over to Adam for a discussion of our first quarter 2017 financial performance. Adam?

Thank you, Steve, and good afternoon, everyone. The first 3 months of 2017 included a number of important business activities that had an impact on our overall financial results.

Revenue increased to $296 million from $291 million for the comparable period of 2016. There were several factors that impacted revenue during the first 3 months of 2017, which we expect to continue throughout the year. Our revenue cycle management program is in full swing at Bio-Reference and we have seen overall improvements in our main clinical lab operations, particularly during March, a trend we continue -- we saw continue into April and expect to see throughout the year.

We anticipate the improvements to result in increased profitability in our diagnostics segment with increasing pace during the second half of the year. The improvements in our clinical labs have been partially offset by pricing headwinds we faced within our genomics testing.

As we expected, overall patient counts continue to grow in the first quarter, and we expect the growth to accelerate into Q2 and throughout the rest of the year.

As Steve reviewed, the Rayaldee launch is underway and we have secured insurance formulary access for Rayaldee in excess of 60% of all potential patients covered and continue to see prescription trends improving month over month.

During the next several quarters, we are focused on increased our insurance formulary access, particularly for Medicare Part D plans.

In anticipation of the improved formulary access, we have begun the process to expand our commercial reach with additional field representatives. We expect to begin selectively hiring in territories where insurance formulary access is the greatest, along with physicians in territories that would benefit from having sales representatives call more frequently.

Turning to cost and expenses. During the first 3 months of 2017, cost and expenses increased over the comparable period of 2016, principally related to our introduction of Rayaldee, of approximately $13.5 million. We continue to invest in our pharmaceutical and diagnostics research and development programs and had approximately $26 million of R&D expense during the quarter compared to approximately $28 million for the 2016 period.

Net loss for the 3-month period ending March, 2017, was $31 million compared to a loss of $12 million in the comparable period of 2016. The 2016 period included a nonrecurring deferred tax benefit of $20.5 million principally related to an income tax rate change in Israel.

Our balance sheet remains in a strong position to continue the development of our R&D programs as well as to support our commercialization efforts for Rayaldee.

On March 31, 2017, we had $131 million in cash and cash equivalents on our balance sheet with an additional $100 million in availability under our credit facilities.

With that, I'd like to turn the call back to Phil. Phil?

I want to thank you all for participating, and we look forward to talking again at the end of the next quarter.

With that, we'll open the floor up for questions. Thank you.

(Operator Instructions) And your first question comes from Kevin DeGeeter from Ladenburg.

Just a few from me. Can you comment with regard to the potential expansion of the Rayaldee sales force? And just put some harder numbers on that, how many sales folks do you hope to add in the coming months?

Yes, so I think, when we think about the right size for the sales force on a full basis, it would go up to 70. I think we're -- we launched with 35, and really in order for us to get to that 70 number, we need to get our insurance formulary access into the mid-70s to low 80s range and start to see prescription trends go up. So I think it's going to be a build throughout the year, Kevin.

Okay. With regard to BLA filing for human growth hormone for the adult patient population, can you just elaborate on, well, 2 points. First, in what form might we see the results from the more detailed outlier analysis? And then just b, you did reiterate plans to file a BLA for that indication in 2017. Given the mixed topline results, what gives you incremental confidence that, that's the right step forward at this time?

Well, it would require that the analysis that we're undertaking to show that with the outlier analysis, we would actually meet the primary endpoint. So that's what we're confident that the data will show. We'll make that announcement once the analysis is complete. And then assuming that it did -- shows what I just said and what we believe it will, then we would have the confidence to submit the BLA with that modified analysis to FDA.

I think the point is that in order to get to that point, we're going to have to go through all kinds of hoops and that includes validating all of the data that was obtained during the study. And then once all the data is validated, then we can do the analysis. And that's what we're confident about that when all that is behind us, that it will turn out the way we want it to and we'll be able to go forth with the BLA.

Okay. That's very helpful. And then maybe just one more for me, then I'll get back into queue. With regard to 4Kscore and Medicare reimbursement, can you provide us an updated timeline or set of metrics as to how to think about a potential coverage decision, local coverage decision from Novitas and final clarity on that question?

The important point here is that Novitas has been paying and continues to pay at the rate that was indicated by the CMA. And so we're now getting over $600, and that's scheduled to go up to $750 in 2018. And we have every reason to believe that they will continue to pay. So as far as their actually issuing a positive LCD, we would like that to happen. And toward that end, we're doing a lot of additional clinical trials and we'll cooperate with them and with the other [MACs] as well in getting them to think very favorably about the test. But in the meantime, the important point for us and for the -- from the financial point of view is that they continue to pay. And on that basis, we're now going to embark on a very rigorous marketing program in attempt to dramatically increase the utilization of 4K and the revenues from the test.

(Operator Instructions) And your next question comes from Yale Jen from Laidlaw.

Maybe just tag on a little bit on Gavin's earlier question, which in terms of the 4Kscore promotions, how much effort the Bio-Reference reps currently sort of non-neurology reps in starting to promote the sales of that? And how would you measure the performance at this point? And what do you anticipate over the next 12 months for them?

So currently, we have 200 of the sales people at Bio-Reference trained to detail to the 4Kscore. So our -- as you heard Dr. Frost speaking, I think we're at the point now where we're comfortable enough with the reimbursement on the Medicare side and certainly sufficient on the commercial side, to put a more focused marketing effort and dollars behind it. So what we are working on is a plan to utilize more of the Bio-Reference sales people and perhaps use some other marketing techniques and incentives to really push the 4Kscore forward. So we'll continue to show growth, and I think with a little more muscle effort and acquiring some more sales people we expect to have more significant incremental growth in the future.

Okay, great. That's helpful. And just one more question for me which is in the Rayaldee.

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(inaudible) conference, earnings calls do you start to have a better sort of feeling toward it or it's too early to suggest?

Most of your question, you were cut off. Could you please repeat it? I'm sorry, we're still continuing obviously to have these technical difficulties.

Okay, not a problem. For Rayaldee, do you anticipate you'll be able to start talking a little bit more about the script trends? Would that be -- if you can put a little bit time frame on that, would that be in the later part of the second half of this year? Or you have different thoughts?

Yes, so Yale, I think as we mentioned earlier this year, the first half of the year is really focused on building out that insurance formulary access. Clearly, we want to continue to see positive trends and positive growth in the scripts. But we don't think that we'll have a significant build in scripts kind of day-over-day or week-over-week until we take down some of those barriers on the insurance formulary access. And at little over 60%, we're a little ahead of where we expected to be, but we still face challenges as it relates to having doctors be willing to go through some of the medical exception process they have to go through. Particularly on the Medicare Part D, while we're getting a lot of our Medicare Part D scripts filled today, we think we'll be able to accelerate it once we get those insurance formularies on board.

You're [tricking] into any type thing. When a doctor writes a script and then the patient complains that the insurance doesn't pay for it, it discourages the doctor from writing future scripts. So you have to get the payers to pay in order to complete the cycle of, right, having the script written and the prescription filled. And so we're emphasizing that point in the cycle on the one hand. On the other hand, we're pushing the marketing and sales.

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Were you able to hear our response?

It was cut off. I heard in terms of the it's chicken and egg situation and after that I was cut off from that. I guess that you want to pave the field before they will start to taking scripts. I guess that's one of the things and you guys want to do maybe a little bit more marketing being able to get more awareness, I guess that's what I get, but there certainly is some details I probably have missed. Okay, I appreciate that. Maybe we can talk a little bit more off-line a little bit more later on.

We can do that. Unfortunately, we seem to continue to have these difficulties with our conference lines.

Other questions?

There are no further questions at this time. Dr. Frost, I'll turn it back to you for closing remarks.

There are no further closing remarks. So we'll thank you once again.

Ladies and gentlemen, this concludes today's conference call. You may now disconnect.