Vaxart Inc (VXRT) 2007 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the third quarter 2007 Nabi Biopharmaceuticals earnings conference call. My name is Melanie and I will be your coordinator today. (OPERATOR INSTRUCTIONS) I would now like to turn the call over to Mr. Gregory Fries, Manager, Investor Relations. Please proceed, sir.

Thank you, Melanie, and thank you for joining us today. I'd like to remind you that today's call may include forward-looking statements. These forward-looking statements and related risk factors are more fully disclosed in our annual report on Form 10-K for the fiscal year ended December 30, 2006, and in our quarterly report on Form 10-Q for the quarter ended June 30, 2007, both filed with the Securities and Exchange Commission. More information is also available at our website, www.nabi.com.

At this time I'd like to turn the call over to Dr. Leslie Hudson, Interim President and Chief Executive Officer of Nabi. Les?

Thanks, Greg, and thanks to all of you for participating in the call. Joining me for today's call is Jordan Siegel. Jordan is our Senior Vice President of Finance and Administration, our Chief Financial Officer and also Treasurer. In addition, Paul Kessler. Dr. Kessler is Senior Vice President of Clinical, Medical and Regulatory Affairs. And also Raafat Fahim. Dr. Fahim is Chief Operating Officer and General Manager of the Biological Strategic Unit in Boca Raton, as well as Senior Vice President of Research, Technical and Production Operation. We're joining you, in fact, from both of our sites. Some of us are in Boca Raton and some of us are in our Rockville location. Hopefully, this is going to be fully transparent to you.

On this call we'll be talking to you about our third quarter financial results, as well as giving you an update of the information we provided in yesterday's announcement about the completion of our NicVAX Phase 2b trial. These data were presented yesterday at the American Heart Association Scientific Sessions in Orlando, Florida, and these slides were made available on Nabi's website immediately after the verbal presentation.

As an overview, let me start by saying that our third quarter financial performance continues the trend that we see now through three straight quarters of a drive to increase revenue, reduce losses, and conserve cash. And we've been successful in each of these endeavors, as you'll see, compared to 2006. And Jordan will provide you more information and details on that in a few moments, as well as ultimately answering any further questions that you'd have.

So, overall, the third quarter revenues continue the pattern of year-over-year growth and improvement, and we remain on track to achieve our cost control and cash utilization targets for 2007. This is one of the major corporate goals that we set off for ourselves at the beginning of this year, and I believe we're going to achieve it.

Also earlier today our shareholders approved the sale of our Biologic Strategic Business Unit and Corporate Shared Services Group. This is a significant milestone in our Strategic Alternatives Process and indeed it's the second corporate goal that we set for ourselves at the beginning of the year. And it's part of the overall drive to improve and deliver shareholder value.

The shareholder vote, as you will have seen from the press release, was really a very significant majority. Over 60% of the shares outstanding were present at the meeting. Out of the shares that were voted, it was a 98% vote in favor of selling the business to Biotest. So, we anticipate closing this transaction by the end of the year.

So, with those two good milestones behind us, let me now turn the call over to Jordan Siegel for a review of our third quarter. Jordan, please.

Thank you, Les. Total revenues for the third quarter were $20.1 million compared to $19.6 million during the third quarter of 2006. Antibody revenues grew by 30%, or $3.7 million versus the 2006 period due to higher tetanus and anti-D revenues. Nabi-HB revenues were $7.4 million, up 9% from the previous year.

These revenue gains were substantially offset by a $3.3 million charge related to an unfavorable court ruling that vacated a portion of the $4.5 million awarded to us earlier this year related to a contract manufacturing binding arbitration agreement with Inhibitex. We will vigorously challenge this ruling upon appeal.

The net loss from continuing operations was $15.9 million, or $0.26 per share compared to $16.3 million, or $0.27 per share during the 2006 period. Results for the third quarter of 2007 were negatively impacted by the $3.3 million Inhibitex arbitration ruling just mentioned a minute ago, a $2.7 million charge related to the termination of our future obligations associated with the development of ATG-Fresenius, and approximately $1.5 million of transaction costs related to the pending divestiture of our Biologic Strategic Business Unit.

For the nine months ending September 29, 2007, total revenues were $64.7 million, 9% higher than the $59.5 million reported during 2006. The net loss from continuing operations was $31.9 million, or $0.52 per share, compared to $45.4 million, or $0.75 per share during the 2006 period. This is a reduction of 30%.

Cash used in operating activities from continued operations during the nine months ended September 29 was $16.6 million, a 48% reduction compared to the $31.9 million used during the 2006 period. We ended the third quarter with cash, cash equivalent and marketable securities totaling $100 million.

During the third quarter of 2007, selling, general and administrative expenses were $8.9 million, or 44% of revenue, compared to $10.4 million, or 53% of revenue during 2006. This decrease was primarily due to lower selling and marketing expenses related to the Biologics SBU and our continued effort to reduce overall infrastructure costs.

Total research and development expenses were $12.9 million during the third quarter compared to $10.2 million during the 2006 period. The Biologics SBU research and development expenses were $10.7 million, compared to $5.1 million during the third quarter of 2006. The increase in R&D expenses for the Biologics SBU reflect the acceleration of Nabi's IVIG development program, along with costs to obtain approval of our BLA for Nabi-HB intravenous.

Additionally, we recorded a charge of $2.7 million in the current quarter, as I mentioned before, related to the termination of our future obligation related to the development of ATG-Fresenius.

The Pharmaceutical SBU research and development expenses were $2.2 million compared to $5.1 million during 2006.

On September 11, we entered into an asset purchase agreement with Biotest AG and Biotest Pharmaceutical Corporation to sell our Biologics SBU and certain of our corporate shared service assets for $185 million. As Les just mentioned, our shareholders approved the sale earlier today and we expect to complete this transaction during the fourth quarter..

As a result of receiving shareholder approval, the results of operation, assets and liabilities of the Biologics SBU and certain corporate shared services assets will be accounted for as discontinued operations beginning next quarter.

When this transaction closes, it will have a profound impact on Nabi's financial position and future performance. The Company will receive sale proceeds of $185 million and will record a gain of approximately $75 million. As such, we are withdrawing the full year guidance provided during our second quarter conference call. We will provide you with our 2008 guidance when we report our 2007 year-end results.

In the event this asset sale does not close prior to year-end, we do reaffirm our prior guidance. And now I'd like to turn the call back to Les.

Thanks very much, indeed, Jordan. So, as I mentioned, I'd like to turn now to the other significant corporate milestone, which was the successful completion of our Phase 2b trial. The data that we put on the website yesterday from the AHA presentation, I'm not going to go over it again in the verbal part of this presentation, but we will be very happy to take follow-up questions when we get to the Q&A part of this presentation for you all.

I'd like also, though, to spend some time now to look at the relationship of the anti-nicotine antibody response, and particularly the concentration of the antibody to the abstinence results we've seen at the end now of this 12-month trial. And let me remind you, also, that these slides are actually available on our website for you to actually follow through.

So, if we look at that supplementary slide set that we put together, looking at the relationship of the antibody to abstinence, let's go to slide 3. This just lays out for you what the fundamentals of the Phase 2 trial design actually was. These fundamentals were, first of all, there were two different schedules, two different doses tested. They were heavy smokers. They were actually, also, really quite committed smokers, especially with respect to the number of unsuccessful quits that they had previously gone through. So, these were really quite a committed group that we assumed at the outset would be difficult to move.

The other thing that I'd like to point out to you that in the two schedules for each dose, there was a different number of injections, but there was also a difference in the frequency of injections for the primary series. So, essentially, it was four weeks apart for Schedule 2, and six weeks apart for Schedule 1.

So, go to the next slide, No. 4, and you'll see the endpoints that we have been reporting consistently now going out to the full 12 months. You see that in fact our eight-week abstinence immediately prior to the six months was our primary endpoint. Now we've seen that in fact looking at continuous abstinence to six months and now, of course, to 12 months is equally powerful.

We'll show you some data later, as well, that if you look for the last four months, again, still a very, very profound period of abstinence, you see also a very, very significant response. And so this is part of the thinking that we're going through now as we're at the end of the Phase 2 proof of concept trial around really what is the best primary and secondary abstinence measures to use.

I would admit that these are indeed often viewed as regulatory nuances, because once you get o the marketplace they often bear no relationship to how the drug is actually used and what it takes to make it effective. But obviously we never forget that it's very important to get over that regulatory hurdle of approval first. That's why we put a lot of focus into that.

So, we go to the next slide, slide 5 looks at the 12-month continuous abstinence data. You can see that 16% of patients in Schedule 2, a 400 mcg dose, were abstinent compared to 6% for placebo, and this was statistically significant at the 0.05 level. You see also for Schedule 1 versus Schedule 2, there was really quite a profound difference in terms of the number of people who are abstaining. I'm going to pick that point up again in a second.

The other thing you'll see from this slide that the placebo rate, which had been 4% abstinence at nine months, we've now shown this as 6%. The reason for doing it is that the two schedules had different intervals and also different numbers of injections, and so they needed to be blinded with respect to each other and also the placebo. And they were conducted, then, two weeks apart with respect to week, the general study week.

So, the abstinence being strongly driven, we've now seen in the full 12-month data, the abstinence rates are very strongly driven by the target quit date rather than the study week. And our external statistical consultants have suggested that we should align by target quit date as this is a more conservative and robust way of actually looking, in this case, at the placebo, which has a shift of two weeks because of the way in which the study was run.

What in fact has happened is by doing that it's brought in two additional abstainers into the placebo group. If one goes back retrospectively at nine months, as well as we're showing here at 12 months, then the placebo rate of 6% is still actually on the low side for people who conduct these sorts of studies. It's still statistically significant with regard to Schedule 2 of 400 mcg, which if you remember, at nine months was our optimal dose and regimen indeed continues at 12 months to the optimal dose and regimen.

In the next slide we show the antibody response, and this is the antibody response in terms of micrograms of anti-nicotine antibody. For reasons of confidentiality and its proprietary nature, we in fact are not disclosing almost any of the vertical measures that you'll see on our graphs, either with respect to the amount of antibody or, indeed, any of the thresholds that we defined. That is simply because we believe that in anybody conducting vaccine studies irrespective of the type of vaccines or any other small differences, once you've achieved an anti-nicotine antibody, probably the same kinetics of responsiveness actually will apply.

So, first of all, let's go back now. Look, then, at the antibody response by treatment arm, and what I want to answer is why do we think the two schedules were so different? And if you actually look at the relationship between the target quit date shown as arrows at the beginning of the graph, and the rising antibody level, you can see that in fact there is a very significant difference between Schedule 2 and Schedule 1 with respect to the target quit dates, respectively.

And so the amount of antibody and also the duration of the antibody to get across the threshold needs to be as well aligned with the target quit date as possible. So, that's one factor which we believe is driving the differences between Schedule 1 and Schedule 2.

The other is if you actually look at the duration and magnitude of the long-term response, again, Schedule 2 and indeed 400 mcg consistently has a much higher C -- concentration of antibody in micrograms in that regard.

So, it's important to get a good alignment of antibody with the target quit date, and from that point of view I think it's obvious in looking at this slide that although Schedule 1 would have had enough power if we'd had a later target quit date, it still would have been inferior to Schedule 2 in the longer term response. And that will become obvious as we go through. So, why is this important to get a good alignment between antibody concentration and target quit date?

Take a look at the next slide, slide 7, and you will see NicVAX 400 mcg, Schedule 2, for those subjects who at seven weeks are able to develop antibodies that cross the threshold that we've been able to determine. And you can see that the number of abstainers are twice as large in the group that actually crosses that threshold. And interestingly, the same threshold and actually the same ballpark value for mcg/mL of antibody was actually determined from both pre-clinical and clinical values.

So, the really interesting observation here is that the value of the antibody level at seven weeks drives the outcome at 12 months. And we saw the same story at six months as well as at nine months, and that's a very important observation.

If we go to next slide you'll see what is a slightly different way of looking at this data which we can now do across the whole of the study. And what we're asking here is if one looks at the antibody responsive patients and you stratify them a third, a third, a third, so the low, the medium, and the high, what impact does this have in driving not quit at the target quit date, but actually long-term quit?

So, here what we're asking is how many patients with how much antibody are abstinent for at least four months, and were abstinent at the end of the trial? So, this is not a floating quit rate. You have to be still abstinent at the end of the trial. What you can see that in fact the high antibody responders give a very significant number of additional quitters who remain abstinent all the way through to the end of the trial. Again, showing that the antibody concentration is important not only early to be able to actually drive the quit, but also it's important late to be able to sustain the quit as continuous abstinence.

The next slide, slide 9, again shows some new data which I think was extremely interesting from our point of view. Again, although it's not registrationally important, this is looking now at the consumption of cigarettes in those who in fact continue smoking. These are people who are nonabstainers. Although we've got a registrational endpoint, this data could be very important for marketing claims when one ultimately gets on the market.

And what you can see, again, we're looking again at stratification of this long-term antibody response at the end of the primary dosing schedule, so we're looking at about 16 weeks here. And you see that the top third of antibody responders consistently on repeated measure throughout the whole of the trial are actually showing a reduction in the number of cigarettes they've consumed in approximate terms starting from 20 cigarettes per day baseline, they've gone down to 10 or below consistently throughout the study.

So, clearly, again, attesting to the fact that antibody response is extremely important and is actually correlated with the -- not just the abstinence, but also the number of cigarettes that are smoked, and I presume the number of cigarettes that are enjoyed or not enjoyed. I guess leading to a degree of disinterest in smoking, which is enough to reduce the amount of cigarette smoke to a statistically significant degree, but not enough to actually drive abstinence in this study. Now, that in itself, again, has actually given us some clues which I'll come back to.

So, in essence, then, the conclusions, the optimal dosing schedule remains at 400 mcg, Schedule 2, and it's the best regimen to attain the threshold antibody response at the target quit date. So, it actually drives both the quit and also the long-term abstinence better than the other doses and other schedules.

Secondly, the high antibody levels drive long-term abstinence and elicit additional spontaneous abstinence, meaning, then, that the people who were quitting late in that slide were not being told to quit by the psychologist preparing them to quit. And so this is very intriguing now, and it should allow us to be able to harvest some of these late spontaneous quitters, in principle, as we actually improve the design of the go-forward trials.

We mentioned the high antibody level decreasing cigarette consumption, and also that the trial provides us with critical insights in terms of antibody concentration and duration, and how this correlates with the size of the abstinent population. The important thing is that these findings inform, we believe, our clinical development program moving forward.

So, what do we believe we've learned? First of all, that there is a threshold which greatly increases the likelihood of quit, and this is an early threshold and the target quit date needs to be aligned with this threshold. Needs, in fact, to be better aligned with the threshold than we achieved in this trial.

There is also a threshold in a longer term time scale which drives accumulation of additional abstainers. So, here again, increased antibody but increased duration. Very important kinetics.

And then, finally, patients shouldn't be psychologically prepared by the behavioralist to quit before their antibody concentration has crossed the critical target quit date threshold. In other words, the two must be put together.

So, that leads us to an improved trial design based on Schedule 2. We'll go, we believe for a later quit date, and so the psychological counseling will be built up around that later target quit date. We will introduce greater intensity of psychological counseling. It will be actually of different types and different phases at the beginning. It will be aimed to control dropout during the period when the patients are being immunized and prepared. They've been getting the antibody tools to quit.

Then, secondly, there will be the standard preparation to quit and the target quit date. And then, finally, for those who quit will actually move into psychological counseling to support abstinence.

We also will have the later injections in the five-week, five schedule -- five-injection schedule broad into a four-week concordance with the primary series, so we actually achieve a higher antibody concentration with longer duration in a greater population of vaccinated subjects.

So, in conclusion, we started the manufacturing of Phase 3 lots, as we believe this will be important for a partner and also obviously for a timely start to a Phase 3 study. We also intend to carry out a very short, sharp immunogenicity study without any efficacy measures to confirm our expectations of the antibody kinetics and duration. That's very important to get the target quit date nailed very, very nicely, indeed.

What's important, though, is this will be a small enough study and will be executed sufficiently rapidly. It's basically a stick-and-bleed study, that it will not delay our timings for Phase 3.

Okay. I think that's the summary of the data which is the data in addition to what we presented through Stephen Rennard yesterday at the American Heart Association, and with that maybe I could turn it back to Melanie, our operator, for the question-and-answer part of this session.

Yes, sir. (OPERATOR INSTRUCTIONS) Our first question comes from the line of Stephen Dunn with Dawson James. Go ahead.

Congratulations, Les and the team on the NicVAX data and the BO test shareholder approval. I guess some of the headlines came off of the data, obviously the reporters aren't into the nuances of the data. I kind of want to explore the comments, well, the efficacy rates are shown in the Phase 2 dose ranging study were similar to Pfizer's Chantix. But what I want to kind of ask your opinion is, if we look at the side effects of Chantix, especially nausea, we're looking at nausea of about 30% at the high dose. We're showing NicVAX only 7% of nausea. And both drugs, the placebo nausea was 10%. So, there wasn't a real difference in the patient population so much. Do you feel, in your opinion, that the Chantix high rates of nausea are due to metabolizing the drug in the GI, or some other hypothesis?

Yes, I think one is always reticent to actually talk about somebody else's drug, particularly when we just had a successful completion of a Phase 2 trial. But I think it's relatively well understood in the field. In fact, let me hand it over to Paul Kessler, our Chief Medical Officer, to basically very briefly just touch on it.

The two drugs have different mechanisms of action. The point about NicVAX and the antibodies is it elicits is to try to prevent nicotine from getting into the brain. In contrast, Chantix and other drugs approved for smoking cessation act centrally. So, some of these side effects are not unexpected.

I think the other aspect that you clearly in your own release on this actually highlighted very well is that what one is looking at with vaccination-type schedules like this with NicVAX is really very long-term abstinence that we're driving here. And it's a situation where, of course, we're very excited now about the possibility of starting to look at relapse as well. Because I think originally people have thought that maybe vaccines were good for relapse and that Chantix or a drug like Chantix would be good for quit. I think we can actually drive both now. But the good thing is, these are mechanisms which actually are very different and are not mutually incompatible, at least in principle.

Well, let's explore a little bit more. I guess the patients in your Phase 2 were a pack-a-day smokers. You made some allusion to this in the comments that these patients had already failed previous therapies. Could you characterize how many times the tried to quit, or in fact if they were Chantix failures?

The study was begun before Chantix was approved, so there are no Chantix failures in our groups. Our subjects had tried to quite a number of times. I think an average of three times, at least on average of three times. But it's not fair to look at the subjects as Chantix failures, because the study predates their approval.

But the differences are mechanism of action would not preclude using this should they fail Chantix?

No, absolutely not. As I said, the two are indeed entirely complementary in many ways. I think, though, it would be a pity if anybody got the idea that NicVAX was only good for Chantix failures.

Okay. I guess switching gears here, since it's a biologic, NicVAX I'm assuming will be a little costly. Looking at insurance reimbursement, obviously this is a targeted personal therapy here because of the high responder versus low responder. If I was an insurance company, and I guess what I would like to know is in your opinion, what is the earliest point in the therapy can I separate out those that are responding and those that are not?

Yes, you know, this is actually a very important point and in many ways it links with the question that, again, one would get. If you use psychological counseling, particularly if it's intense psychological counseling, how are you going to reproduce that in the marketplace, right? So, how do you know that you're ready to quit, and how do you replace the psychologist?

I think what you're heading towards, Stephen, here is probably a very simple antibody-based test where basically you're detecting very much like, for example, a pregnancy-type test, where obviously you're detecting antigen, but detecting the level of antibody, and the test telling the patient you're ready to quit. I mean, that would be an extremely effective marketing tool, but more importantly, it would actually allow one to achieve exactly what you're asking, which is segregating not low and high responders, but rather early and later responders.

Okay, that's fair enough. Last question. Les, if you're looking at 12-month data, there are six months out of the last dose and they started -- even the quitters started smoking a few more cigarettes and we saw a few patients fall off the bandwagon. Are there discussions along the line of having, let's say, a booster shot at 12 months, or some follow-up booster program?

So, we are now, I think, with a schedule where what we are (inaudible) are very minor modifications to move the timing of some of the latter doses. What that would look like in the longer term, clearly, the question you're asking is very important. You could have a booster follow-up.

One thing that's important, though, this study we've just completed did not have a lot of psychological counseling, and no support was given to those patients whatsoever during the phase of the long-term abstinence. You know, from 6 to 12 months. That's a very obvious improvement that one would bring in.

Psychologically, if you can keep people supported, you can get them past that one-year mark and then all sorts of other sorts of benefits start kicking in. You know, you can run faster, you can actually walk without getting out of breath up stairs. Your heart risk goes down by half. You get a lot of positive feedback. It may actually not be necessary, but it's certainly not (inaudible). You could do it, but there is no evidence that you'd have to. I personally would, first of all, actually go to, if you like psychological feedback both from a psychologist or a smoking center, and then on top of it the very positive health benefit the patients would get.

All right, great. Congratulations on both fronts and I'll jump back into the queue.

(OPERATOR INSTRUCTIONS) Our next question comes from the line of Robin [Conesukas] with Bear, Stearns.

Hi. Thanks for taking my question. I promise I only have like 12 or 15 of them.

Oh, Robin, only that number. We thought you'd have twice that.

Okay, great. So, just starting off, a quick thing. I wonder if you could update us on spending for StaphVAX now that the deal, the shareholders have agreed that the deal should go through. How are you going to allocate the money?

Well, I mean, first of all, you must have noticed that actually the need for StaphVAX or the problem of staph aureus infection has actually just gone up again enormously. And what that has driven is something which the company has actually said very, very clearly, that I wants to get a partner before it actually goes forward with that spending. Clearly, what we must do is to make sure that our ability to actually carry forward a program on the Pentavatent vaccine with that partner is not impaired either by the sale of our biologics division to be a test, or indeed by leaving it completely unattended to. I mean, clearly, there is a lot of growth potential there, but getting a partner is equally important. Fortunately, we're still getting interest.

Okay, great. So, what about spending going forward, and R&D and SG&A. What are your thoughts going forward. Can you give us an update?

That's the sort of level of detail we don't normally share and certainly not this early for next year, because you're really asking about events that will be next year when we've actually closed. We haven't started spending the money from the transaction let alone actually counting it yet.

Fair enough, fair enough. The next question regarding the partnership, potential partnership for NicVAX. Can you give us some color on how discussions might have progressed from your last conference call?

Well, you can imagine the presence of the 12-month data has been extremely important. I hope, also, the color that we've been able to actually add to that now by talking through data which in fact has not previously been released is something which clearly drives the interest a great deal in this. You heard, also, that the Company basically remains committed to this. This is not something we're going to let languish, and it's something which in fact in terms of the field, you've only got to look at how well [Phytos] is doing, actually, in terms of its market cap, and it's NicVAX equivalent, it's arguably its major asset. So, I think we're in a situation where this data has come in a very timely manner and there is a lot of buzz around about it. I think we even made CBS last night.

So, will you be prepared to start a Phase 3 on your own if the partnership doesn't get done in time, or are you still standing by your projections that you really want a partner the product before going into Phase 3?

Which CEO with $185 million in cash and a good balance sheet to begin with could say to the shareholders, we're going to leave this to languish?

Okay, fair enough. And I have a last question, I promise, I promise. I was just wondering how much variability there were in the antibody levels between the patients? Or how easy is it going to be to align a target quit date, even if you were to push it out a little bit?

Well, what one tries to do, as you know, is you go far enough out so that effectively you get all of the patients above the target quit date. The reason we're going to do that is that just from the data we've shown today, we can actually double the likelihood of people quitting under those circumstances. So, what we've got to control is that those patients don't drop out.

But when you've got patients coming into a trial where you can tell those patients, you know, we've been able to actually get people to stay abstinent for 12 months, that's a very powerful psychology. And it's a very different sort of psychology going into this trial where I think people were thinking that a vaccine would be like a drug, that it would actually come on very fast, would actually operate very quickly, and at the same time, unfortunately, would relapse equally quickly. I think that's the dynamic we're seeking to change here.

Okay, great. Thanks a lot.

Our next question comes from the line of Richard [Mansuri] with [Delecam] Capital Management. Go ahead.

Hi, thank you. Just a couple of questions and a comment. Just to be a little more specific regarding the partnering discussions, Les, can you categorize them? I mean, would it be fair to categorize them as robust? I'm just looking for some sort of incremental comfort that you're getting interest from multiple parties. Can you comment on that?

So, Richard, first of all, thank you for joining us on the call and for your question. The data has caused a lot of interest. The buzz has been very real, and the interest from potential partners has followed the buzz.

Okay, great. Second, does Biotest, Biotest AG, do they have any operations in the United States, or is there any reason whatsoever to think that there would be any Hart-Scott issues related to this transaction?

Oh, yes, good question. They have an existing business which is a small diagnostics business. I think it's in [Danbury], New Jersey, but I may be wrong there. But it's essentially diagnostics. Once we close the transaction, obviously Nabi will no longer be in the sort of biologics that Biotest -- I'm sorry, Biotest, they call themselves in the States -- will actually be in the United States.

So, although again you can never predict what a Hart-Scott-Rodino review is going to look like, we actually have asked for early termination, because we think there is no overlap whatsoever, either geographically and certainly not in the business areas. And there is no product overlap.

Okay, great. And then my comment is that Les, you and the key people on the Strategic Action Committee have taken, in our opinion, very appropriate and affirmative steps to enhance value. And in spite of all these efforts, the market has perversely chosen to ascribe what we think is negative value to NicVAX, if you look at where the stock is trading. As such, our suggestion and it's something I'm sure you've heard before. We've mentioned it before. I would just ask you to factor it into the equation, when you and the board consider using cash, to use every conceivable spare dollar possible and return this capital to the shareholders ideally in the form of either a massive Dutch tender or some other form of return of capital. So, if the market doesn't do it, by brut force, Nabi reaches the valuation that it deserves. That is our suggestion.

Well, you know, again, you and I have had a chance to discuss this on more than one occasion as indeed we have with many of our investors. And I think when I came onboard I set some very clear goals and to a large degree we've been very fortunate. The management team and the employees of Nabi have been able to deliver on those. So, in a sense, and I think over the last three quarters, we've turned the tide a bit. But that's not to get a bunch of money and leave it sitting on the balance sheet. I think Nabi investors have supported the Company in a very, very handsome way, for which we're very grateful, and we're very cognizant of our duties to our shareholders and investors.

Well, that's very good to hear. I appreciate that. Thank you.

Thanks for your comments and question, Richard.

Ladies and gentlemen, there are no further questions at this time. I'd like to turn the call back over to management for any closing remarks. Please proceed, gentlemen.

Melanie, thanks very much, indeed, and thanks to all our call participants for joining us today.

So, as you heard, there's been several significant events converging forging a good way for Nabi. The NicVAX data, the strategic alternatives process, the process that's ongoing both for NicVAX and StaphVAX, and hopefully also progress which is being very, very diligently pursued towards the full regulatory approval of Nabi-HB. These are undeniable catalysts and value drivers for the Company, and also for yourselves as its shareholders and stakeholders. I think this is a situation where we're very proud of the last three quarters and we actually are greatly looking forward to the fourth quarter this year.

I want to thank you all very much indeed for your questions today, but also for your continued support as we move forward. Thank you very much indeed and have a great evening. Bye-bye.

Ladies and gentlemen, that does conclude today's presentation. You may all disconnect and have a wonderful day.