Veru Inc (VERU) 2019 Q1 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to Veru Inc.'s Investor's Conference Call. (Operator Instructions) Please note that this event is being recorded.

The statements made on this conference call that are not historical in nature are forward-looking statements. Such forward-looking statements reflect the company's current assessment of the risks and uncertainties related to our businesses. Our actual results and future developments could differ materially from the results or developments in such forward-looking statements. Factors that may cause actual results or developments to differ materially include such things as the risks related to the development of the company's product portfolio, risks related to the ability of the company to obtain sufficient financing on acceptable terms when needed to fund development and company operations, risks related to competition, government contracting risks and other risks detailed in the company's press releases, shareholder communications and Securities and Exchange Commission filings. For additional information regarding such risks, the company urges you to review its 10-Q and 10-K SEC filings.

I would now like to turn the conference over to Dr. Mitchell Steiner, Veru Inc.'s Chairman, CEO and President. Please go ahead, sir.

Thank you, operator, and good morning. This is Dr. Mitchell Steiner, Chairman, President and CEO of Veru Inc. And joining me are Michelle Greco, CFO and CAO; Phil Greenberg, Executive Vice President, Legal; and Chuck Todd, CEO of the Female Health Company Division. Thank you for joining our call.

Veru is a urology and oncology biopharmaceutical company focusing on prostate cancer and prostate cancer supportive care medicines. Today, we will update you on the clinical development of our drug pipeline and the commercialization of our products as well as provide financial highlights for the first fiscal quarter 2019.

Our strategy is to eventually be known as the prostate cancer company. Rather than focusing on one drug class or one research platform, we aspire to be disease-focused by providing a continuum of care for prostate cancer patients. Prostate cancer is becoming a chronic disease, with new challenges as prostate cancer develops resistance to current drugs and progresses and as the patient suffers from the long-term side effects of these treatments, like bone loss and fractures, hot flashes, loss of libido and erectile dysfunction, loss of muscle strength and fret and frailty.

Accordingly, we are dedicated to the development and commercialization of products to address unmet medical needs for prostate cancer treatment and supportive care. The markets for prostate cancer treatment and prostate cancer supportive care are well established as multibillion-dollar markets. And given our core expertise and the number and type of drugs in our pipeline, we are uniquely positioned to understand, develop and commercialize medicines for these unmet medical needs of prostate cancer patients.

Veru has now advanced into human clinical trials all of our current drug product candidates in prostate cancer. We are enrolling in open-label Phase 1b/2 clinical trial for VERU-111, a novel selective oral antitubulin which is being evaluated in men, metastatic castration-resistant prostate cancer that has also become resistant to androgen blocking agents abiraterone and enzalutamide.

We are also enrolling a Phase 2 clinical trial evaluating zuclomiphene citrate, formerly known as VERU-944, a proprietary estrogen receptor agonist, as a prostate cancer supportive care product for the treatment of hot flashes caused by androgen deprivation therapy. We expect clinical results from both of these clinical trials in 2019.

Our strategy is to become known as the prostate cancer company. And to be supported in part by investments from two commercial sources of revenue - one is immediate and the other is near term.

As you can see from the earnings release, our immediate commercial strategy is showing great progress as we have generated significant and high-growth revenues and gross profits from our commercial products, the FC2 Female/Internal Condom as well as PREBOOST, a 4% benzocaine wipes for premature ejaculation.

In the commercial segment of our business, which is FC2, PREBOOST and drug commercialization costs, operating income was $3.7 million versus $100,000 in the prior year first quarter. Because of this new and significant revenue, we have been able to fund the development of our prostate cancer clinical programs and our urology specialty pharmaceuticals with only an approximate $1 million loss this quarter.

We have seen and expect to continue to see strong revenue growth from our commercial products PREBOOST and FC2. For PREBOOST, we signed a multiyear exclusive U.S. supply and distribution agreement, whose minimum requirements call for them to purchase millions of the company's PREBOOST premature ejaculation wipes to Roman Health Ventures, a premier and fast-growing men's health and telemedicine company that discreetly sells men's health products via the Internet. Roman Health Ventures have changed the name of PREBOOST for this channel to Roman Swipes. Telemedicine is becoming a promising and effective approach to market and sell men's health products directly to the consumer. I look forward to reporting these new revenues next quarter.

For the FC2 business, the Female Health Company Division had a strong quarter, reflected in overall revenue growth at a 25% compound annual growth rate and the U.S. commercial prescription sales over the last 5 quarters at 100% compound annual growth rate. I'm so proud of the Female Health Company management team.

I have invited Chuck Todd, the CEO of the Female Health Company Division to provide the commercial highlights of the successful turnaround. Chuck?

Thank you, Dr. Steiner. Soon after joining the company last year, it became apparent that the 7 quarters of declining unit sales was due to the fact that the FC2 Internal Condom was positioned primarily as a public sector product. This subjected the unpredictable purchasing habits of our large public sector customers and the availability of public donor funds. It became clear that a fresh approach was desperately needed to deliver more and consistent revenue and margin growth.

First we needed to find a way to increase and further diversify the customer base for both ex-U. S. and U.S. public sector sales. Second, we needed to find a way to capitalize on the de minimis FC2 sales in the U.S., by creating the structure to allow for both FC2 U.S. prescription and public sector sales to thrive. Last year we created a separate business unit for the Female Health Company and staffed it with a small dedicated management team. I have the privilege to be the CEO of this new business unit. I have over 35 years of sales and marketing and operational experience creating new markets that allowed my previous companies to become the leaders in their industry. Tasked with taking a fresh approach to the FC2 sales strategy, I felt that with proper positioning we could access new high-value sales channel by targeting the explosion of telemedicine companies that focus on women's health.

I am pleased to report that during this last year we started to see the results of this new strategy. Fiscal Q1 2019 showed solid revenue in gross profit growth. Let's review the FC2 sales by the Female Health Company Division for fiscal Q1 2019. Net revenues were up 146% to $6.4 million from $2.6 million in the prior year first quarter. The division reported FC2 sales growth in both its prescription business and public sector businesses. Gross profit was up 254% to $4.6 million from $1.3 million in the prior year first quarter. Gross margin increased to 73% from 51% in the prior year first quarter. Net revenue from the U.S. prescription business was up 1,500% to $2.4 million from $150,000 in the prior year first quarter. Net revenue in the public sector was up 60% to $3.9 million from $2.4 million in the prior year first quarter.

By the way, these financial results do not reflect the new tender orders that will be coming in from South Africa and Brazil. We announced last quarter that we won 75% of the South African tender, representing up to 120 million units over 3 years. This translates to approximately 30 million units per year and potentially $10.4 million in revenue per year, for a total of approximately $30 million over 3 years. We expect these new orders from South Africa and Brazil to begin shipping during the second and third quarters of this fiscal year.

We continue to expand our U.S. business to a strategy utilizing both an independent sales force and by engaging with leading telemedicine providers. In fiscal year 2019, I expect that margin and revenue growth in the Female Health Company Division will be primarily driven by the U.S. FC2 prescription business.

For Q1 fiscal 2018, the ratio of prescription versus public sector sales was 6% prescription and 94% public sector sales. In Q1 fiscal year 2019, the ratio of sales changed to 40% prescription and 60% public sector sales. Historically, overall revenue for FC2 has been lumpy because of the ordering patterns of our largest customers, the UNFPA, USAID, South Africa and Brazil. Although we expect the public sector market to grow over the next 3 years with the award of South Africa and Brazil, we expect the prescription FC2 business to help partially smooth out quarter-to-quarter and year-to-year variations.

We expect FC2 sales for the remainder of fiscal year 2019 to be strong in both the U.S. and ex-U. S. public sectors as well as the U.S. commercial prescription business. I am excited to lead this effort, to grow the Female Health Company Division and to support Veru's valuable and exciting biopharmaceutical pipeline.

I will now turn the call back to Dr. Steiner.

Thanks, Chuck. Great. So we just heard about our immediate revenue results and expectations. How do we plan to continue this revenue growth trajectory? We will do so by executing on our plan for near-term drug revenue through our urology specialty pharmaceutical division which is developing low-cost near-term pharmaceuticals using an expedited regulatory pathway known as the 505(b)(2).

The 3 drug products currently in clinical development are Tadalafil/finasteride fixed combination tablets, TADFIN, and Tamsulosin XR capsules and sprinkles. Tadalafil/finasteride combination tablets symptoms of BPH and shrink the size of the prostate in men who have enlarged prostates as well as treating erectile dysfunction; whereas, tamsulosin treats the immediate symptoms of BPH in men with smaller prostates.

While we're still making progress with Tamsulosin XR capsules and sprinkles, we have achieved a major and important milestone for our urology specialty pharmaceuticals program. This is the wisdom of moving multiple products through development, having multiple shots on goal. We have completed a successful bioavailability and bioequivalency clinical trial for the company's proprietary tadalafil and finasteride combination tablet for BPH.

TADFIN combination tablet combines two of the most popular medicines, tadalafil and finasteride. They're currently prescribed separately to treat low urinary tract symptoms caused by an enlarged prostate. The coadministration of tadalafil and finasteride has been shown to be clinically more efficacious in treating BPH symptoms than finasteride alone. Our TADFIN combination tablet is proprietary and is designed to improve patient compliance and safety. According to the FDA-approved labeling, tadalafil, which is also known as Cialis, is a PDE5 inhibitor, is improved to treat both BPH and erectile dysfunction.

And finasteride, which is called PROSCAR, is a 5 alpha-reductase inhibitor, is approved to treat symptoms of BPH, prevent the progression of BPH, reduce the risk of acute urinary retention and decrease the potential need for prostate surgery. Finasteride under another name, called Propecia, is also approved to treat male pattern hair loss.

The successful clinical study for TADFIN combination tablet will allow Veru to rely on the safety and efficacy of PROSCAR and Cialis for BPH in the FDA approval process without the requirement of the large clinical trial.

We have trademarked the commercial name of TADFIN and have filed patent applications. If issued, we would have an expiry of 2040. We expect this to be the company's first pharmaceutical urology asset to move into commercialization. We are in the process of making FDA and commercial batches of the drug and plan to submit the new drug application later this year, with an approval and launch expected in 2020.

We believe that TADFIN will be an attractive product for BPH, which has an established multibillion-dollar global market; thus, having TADFIN revenues next calendar year from U.S. sales and from potential partnerships with upfront payments and royalties outside the U.S., should add substantial near-term revenues with high gross margins to the existing and growing revenues from FC2 and PREBOOST products.

Veru is not only growing the commercial assets but is also increasing our enterprise value by advancing the clinical development of our prostate cancer drug candidates. As for a brief update on the advancement of the prostate cancer drug pipeline, we initiated and are enrolling in open-label Phase 1b/2 clinical trial for VERA-111, a novel proprietary first-in-class oral selective antitubulin agent that targets and disrupts alpha and beta tubulin for pre-chemo metastatic castration-resistant prostate cancer patients who have also become resistant to the novel androgen blocking agents enzalutamide and abiraterone. In other words, the open-label Phase 2 trial will target these patients before they have to go on to IV taxane chemotherapy. There are currently no FDA-approved drugs for this indication. As this is an open-label study, we expect safety and efficacy clinical data throughout 2019.

Drugs for advanced prostate cancer currently have over $3 billion in U.S. annual sales.

We initiated and are enrolling patients for a Phase 2 clinical trial evaluating zuclomiphene citrate, a novel proprietary oral nonsteroidal estrogen receptor agonist for this treatment of hot flashes caused by androgen deprivation therapy or hormone treatment for men with advanced prostate cancer, with top line results expected by summer of 2019.

To understand the sales that zuclomiphene can potentially achieve, we sponsored an independent market analysis. Based on this market analysis, the company estimates that the U.S. market potential peak sales for our zuclomiphene will be over $600 million annually. We are very excited about this news as it confirms that this is a major market opportunity for which there are currently no FDA-approved drugs for this indication.

There continues to be scientific interest in our prostate cancer programs. Four abstracts were accepted for presentation for VERU-111 and zuclomiphene citrate at the American Society of Clinical Oncology Genitourinary Cancer Symposium, which will be held this weekend, February 14-16, 2019; three abstracts were accepted for presentation for VERU-111 at the European Association of Urology Congress that will be held in March of 2019 in Barcelona; and one abstract was accepted for presentation for VERU-111 at the American Urological Association Annual Meeting in Chicago in May of 2019.

I will now turn the call over to Michele Greco, the CFO and the CAO, to discuss the financial highlights. Michelle?

Thank you, Dr. Steiner. This quarter we experienced an increase in the public sector volumes in the U.S. prescription business. As Chuck mentioned, the increase in the public sector volumes is without tenders and orders from our two main customers, Brazil and South Africa.

For the first quarter of fiscal 2019, the FC2 unit sales totaled 7.4 million compared to 4.4 million units in the prior year first quarter, an increase of 68%. Net revenues for the first quarter totaled $6.4 million compared to $2.6 million in the prior year quarter, an increase of 146%. Gross margin was 73% for the first quarter compared to 51% for the prior year quarter. The increase in gross margin is driven primarily by the increase in the U.S. prescription business.

Operating expenses decreased by $3.1 million to $5.7 million compared to the prior year quarter of $8.8 million. Included in operating expenses in the prior year quarter is the $3.76 million charge related to the settlement of the Brazilian receivables in December of 2017. Excluding the settlement agreement, the increase in operating expenses of $700,000 is primarily driven by the increased research and development cost of $400,000.

During the quarter, we incurred $1.1 million of interest expense net of a gain for the change in the fair value of the derivative liabilities related to the synthetic royalty financing we entered in March of 2018. For the quarter, we recorded a tax expense of $92,000 compared to a tax benefit of $3.2 million in the prior year quarter. The effective tax rate for this quarter of 4.5% is due to recording a valuation allowance against the net operating loss generated for the quarter in the U.S.

The company has net operating loss carryforwards for U.S. federal tax purposes of $33.2 million, with $14.4 million expiring in years through 2037, and $18.8 million which can be carried forward indefinitely. Our U.K. subsidiary has net operating loss carryforwards of $62.3 million, which do not expire.

The bottom line result for the first quarter of fiscal 2019 was a net loss of $2.1 million or $0.03 per diluted common share, compared to a net loss of $4.2 million or $0.08 per diluted common share in the prior period. The reduction in the net loss of $2.1 million is due primarily to the increase in our net revenues offset by the interest expense.

Looking at the balance sheet, as of December 31, 2018, our cash balance was $9 million and our accounts receivable balance was $2.5 million. Our net working capital was $5.6 million at December 31, 2018, compared to a negative $2.4 million at September 30, 2018.

During the quarter, we used $1.5 million in operations and received net proceeds of $9.3 million from the public offering of the company's common stock. As we have done this quarter, we will continue to run lean clinical and commercial operations and use the sales proceeds from FC2 and PREBOOST to help fund the development of our prostate cancer and urology specialty pharmaceuticals.

Now I'd like to turn the call back to Dr. Steiner.

Thank you, Michelle. As we have completed at least 1 month into Q2 fiscal year 2019, the revenues are strong and seems to be shaping up quite nicely for the quarter.

In summary, we are poised to see open-label efficacy and safety data for VERU-111, our oral antitubulin inhibitor for refectory metastatic castration-resistant prostate cancer as well as top line clinical results for the Phase 2 clinical trial evaluating zuclomiphene for the treatment of hot flashes caused by androgen deprivation therapy, during the first half of 2019.

The NDA for TADFIN will be submitted later this year, with an expected approval and launch in 2020.

We had a strong financial quarter and have significantly advanced our clinical programs. We are committed to driving shareholder value by becoming known as the prostate cancer company and by providing a continuum of care for prostate cancer patients.

With that, I'll now open the call to questions. Operator?

Thank you, Dr. Steiner. (Operator Instructions) And your first question this morning will be from Kumar Raja of Brookline Capital Markets.

Congratulations, Mitch, on all the execution. The first question on (inaudible), obviously you are dose escalating from 4.5 milligram and it goes up to 45 milligram. So at what dose do we expect to see responses? And in terms of the side effect profile, maybe even talk a little bit about what is your expectation in terms of the side effect compared to what we typically see with chemo.

Sure. Thank you for asking the question. So the first part of the question is really related to VERU-111, which is our oral antitubulin. And the Phase 1b, which is what you're referring to is a 3+3 design where we dose escalate these oral doses in 3 patients at a time. And the 3 patients at a time will get 7 days, every day, 7 days, an oral dose of our drug, followed by 2 weeks drug holiday, and that's called a cycle. And then they'll go back 7 days and then 2 weeks off, 7 days and 2 weeks off. So every time we say that, that's a cycle, okay. And so as you rightly pointed out, 4.5 milligrams a day for 7 days is the first dose. And we're going to basically double. So it will go 4.5 to 9, 9 to 18, 18 to 30 -- actually, will not double, go by 9s. Then it goes to 27. Then it goes to 36. So it will go by 9s.

And so the question becomes, where do we expect to see activity? Well, in our preclinical models, it looks incredibly potent. And what I mean by that, it looks like somewhere around 5 nanomolar in concentration is where we expect to see activity. And if you look at the safety data that we did, 28-day safety data where we gave the drug every day in rats and dogs, we were able to see that even at some of the lowest doses, we were able to see that we were able to achieve concentrations in the blood that would be sufficient to start seeing activity with the tumor. So with that said, we're not looking to push this thing -- we believe we'll see activity before we'll see a safety issue. But the first part, the Phase 1b, will be safety. And so we will push the dose until we see a safety signal. But we expect to see efficacy before that. As it's open label, we'll be able to come back.

Now, the 3+3 design means that the patients, well, 3 patients will be treated, and then after those 3 patients have gone through 1 cycle, so that's 7 days and 2 weeks off, and we don't see any dose-limiting toxicity, then we go to the next dose and the next dose and the next dose. And so by the summer, we would expect to be completed, completing the 1b. And in the summer we expect the Phase 2, which would expand to 26 patients, picking the dose that we learned from the 1b. And so we're thinking that in, hopefully, May, June period, may be kind of where we'll start seeing something, which will be great, but it could happen sooner. We just don't know.

In terms of the safety, now, what makes this very interesting, is the IV taxanes, which are antitubulins, are noted for having, one there's IV, because the bioavailability is such that it's pretty much insoluble and has to be given IV. Second thing is that because of the dose-limiting toxicity of neutropenia, it means a drop in white cell count, it can only be given once by IV every 3 weeks. And in another situation we're giving the drug every day for 7 days. And in the animal studies we're able to give the drug every day for 28 days and not see the neutropenia at these clinically relevant doses. The other side effects, we believe what will make us unique, is that we have a potential of not seeing a drop in white cell count, which is a dose-limiting toxicity of taxanes.

And then the second thing in our preclinical models, we were able to see less neurotoxicity. So one of the neurotoxicity side effects of taxanes is you get what's called peripheral neuropathy, which means you get a numb feeling of your toes and your fingers. And in the animal models, we just didn't see that compared to docetaxel and another antitubulin called vinca alkaloids, in blasting.

So those 2 side effects alone will make this attractive and being oral will make this attractive. And so this is a very big year for VERU-111 because we're also treating a patient population that looks like it's the largest growing segment of unmet medical need in prostate cancer, because right now, patients who fail androgen deprivation therapy are going to be placed on abiraterone and enzalutamide. And what we've learned is, if you place on abiraterone and you really squeeze testosterone down, coming in with another drug like enzalutamide to squeeze testosterone down even further, there's not much room and there's not much clinical benefit. And so these patients are now starting to fail. And when they fail, they're having to go to IV taxanes. And that means they leave from the urologist to the medical oncologist. And urologists would love to hold onto these patients with an oral therapy similar to what we're developing with VERU-111.

So it's exciting times for us, because I think this next 6 months for sure will give us an indication of whether we're going to work in this indication. But all the preclinical work that we've done and multiple animal types and multiple cell types and multiple publications suggest that we'll be fine with efficacy and hopefully safety will play out like the animal models that we've already done.

The next question will be from Yi Chen of H.C. Wainwright.

My first question is just to clarify. Do you expect the FC2 prescription business revenue to have no fluctuation at all from quarter-to-quarter? And how much revenue do you expect to receive from the public sector within this fiscal year?

So I'll answer the first question, and I don't know if I can answer the second one because we're not giving guidance. But I'll come back and give you some thoughts. So as Chuck Todd said in his comments, that one of the beauties of having the ratio change in public sector versus U.S. prescription business is that we could even out these fluctuations. We're not expecting fluctuations in the U.S. prescription business. We're expecting it to continue to grow and not go down and up and down and up. And so from quarter-to-quarter and year-to-year, that's important. In fact, we also believe because of the growth, that it will now contribute more and more of the total revenue, meaning that the total revenue of the U.S. and -- ex-U. S. public sector versus U.S. prescription, so that as it becomes bigger, just like a year ago it was 5% now it's 40% U.S. prescription business, imagine now as you're closer to 50% to 60%, then you're going to be able to predict and forecast in a much better way, which historically we were not able to do because it's a lumpy business. So we're feeling pretty good that we should be on a clearer and less lumpy trajectory.

In terms of revenues in the public sector, what we can say is, everything that we've mentioned so far in Q1, it did not include the African tender. As you know, we won 75% of that tender. And that 75% of that tender, at least for this year, should reflect about 30 million units, or roughly about $10 million. And everything's timing. So I don't know how much of that will come in over the next 3 quarters. But we also picked up Brazil, and that wasn't in the numbers before. And so that also can come in, in the second and third quarter of this fiscal year. So we are expecting to see a substantial increase in our revenues from public sector in addition to seeing the growth of the FC2 U.S. prescription business.

My follow-up question is to launch TADFIN in 2020, how many sales reps would you need?

Good question. So we have taken the position that our cash is dear, and that we should be using our money to continue to fund the clinical development of our prostate cancer pipeline. So we've taken the position that we do not want to invest in a sales force and marketing costs. So we have already begun discussions both in the U.S. and ex-U. S. with potential partners. In the ex-U. S., which is an easier one, we, since October, have been engaged with multiple companies across Europe and South America and Canada and Mexico, and particularly focusing on getting partners that could potentially pay an upfront, use their money to get it through the regulatory bodies in those areas, and then we'd get a nice royalty. So that is in progress.

In the U.S., the strategy is the same. If we're able to get a significant royalty on the product that really represents a profit share, then that's pretty damn good, because that basically means that you're basically able to, even year one, start seeing revenue coming in and profits coming in, because you're not paying for marketing and sales, and let somebody else use their money to pay for marketing and sales, and we just take the money. So as you know, in most models, you have to build in a loss for year one and year two, because you're paying for your sales force until they're able to generate enough revenue to turn a profit.

Using this approach, we don't have to put up the upfront money to build a marketing and sales structure, and we also will be able to realize that revenue right away because we're not putting money up against that. So that's why, in my comments, I made the comment that we can take the FC2 and the PREBOOST revenues, which will continue to be strong for 2019, in 2020 you see the launch and the approval of the TADFIN, it could be incremental increase in growth as opposed to now all of a sudden having to stop and use that same money to do a marketing and sales pay or launch.

The next question will be from Peter McMullin of Peter McMullin Consulting.

Congratulations.

Thank you, Mr. Peter.

When do you expect to start shipping to South Africa and Brazil? And related to that, how are we going to avoid the past Brazilian no pay issues?

It's a good question. So the first question is, as we mentioned in our comments, that second quarter, second fiscal year quarter and third fiscal year quarter is when the Brazilian and the South African --

(technical difficulty)

-- will be coming in and so South Africa probably closer to third quarter, but we just don't know. But the good news is that everything is actively going forward, artwork and starting to put the orders in, all things you would expect with these large tenders, which you know we've won a lot of it.

In terms of your question related to Brazil, as you know, we got burned. When we took the company management over and Aspen Park Pharmaceuticals was purchased by the Female Health Company, one of our first things that we were tasked was trying to figure out what to do with the receivables, which were $14 million. We were able to get about $7 million or $8 million of that, and then the government went crazy again. And as you know, it was a very volatile time in terms of the socialist government that was in place in Brazil. And so we had to make a decision. And that decision was to go ahead and factor the receivables so that we get something, because we could get nothing. And that was a good move, because a year later, nothing was coming to any of the people that were waiting for their accounts receivables to be paid. So that was a, in hindsight that was a good move for us to get money and to cut our losses.

Now, how do we avoid that going forward? Well, the answer is, we have an excellent partner. Semina is our partner, distributor in South America, particularly Brazil. And so we have now, are basically asking for more upfront to at least cover our costs. So we're never going to be in the situation where we're at risk for basically having given them product and having that product cost us money to provide it to them. Michelle, do you want to add a couple of comments to that, because you're working on that contract?

Yes. They're going to be paying us like 60% of the total price within about 45 days of the product being shipped. And then the remainder within a set number of days after it's delivered to the government. The other thing is, there's been a change in the government regime in Brazil and there's a whole new outlook towards being pro-supportive of business. And we were caught last time between a change in the government. And so the new government wasn't honoring the contracts and paying the bills of the old government. This is a whole clean slate. They've awarded the tender, and they're supportive of the whole process.

(Operator Instructions) And I'm showing no additional questions. We will conclude the question-and-answer session. I would like to turn the conference back over to Dr. Mitchell Steiner for any closing remarks.

Thank you, operator. I appreciate you joining us on today's call, and I look forward to updating all of you on our progress at our next Investors Call. Thank you.

Thank you, sir. A digital replay of the conference will be available beginning approximately at noon Eastern Time today, February 13, by dialing 1-877-344-7529 in the U.S., and 1-412-317-0088 internationally. You will be prompted to enter the replay access code, which will be 10128045. Please record your name and company when joining. The conference has now concluded. Thank you for attending today's discussion. At this time, you may disconnect your line.