Q1 2020 Earnings Call
And to our participants presently standing by for today's Kim Bio conference call. At this time, we are admitting additional callers and we hope to be getting underway interest an extra two or three minutes. We thank you all for your participation. That's what was your patience as we ask that you. Please continue to standby.
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And once again Hello to our participants standing by for today's Kim Bio conference call at this time, where admitting additional callers we're still hoping to get started in the next minute or too. We do thank you all for your participation. We ask that you. Please remain on line. Thank you all.
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Ladies and gentlemen, thank you all for standing by and thank you for joining US today for this Kim Bio first quarter 2020 earnings conference call and webcast. As a reminder, all phone participants ARNA listen only mode. But later you will have the opportunity to ask questions and instructions on how to do so we'll be shared at that time and out to get us started with opening remarks and.
Production I am pleased to turn the floor over to fill up Taylor with Investor Relations good afternoon filled.
Thank you before we begin today, let me remind you that the company's remarks made during this conference call today make for 2020 include forward looking statements within the meaning of the Securities Act of 1933 concerning the current beliefs and the company forward looking statements are subject to numerous assumptions Rick.
And uncertainties, many of which would be on combined was control, including risks and uncertainties described from time to time income buyouts FCC filings, including those under risk factors and elsewhere in Chembios annual report on form 10-K for 2019 combine those results may differ materially from those projected Kim.
Hi undertakes no obligation to publicly revise or update any forward looking statements made today I encourage you to review all of the company's filings with the FCC concerning these and other matters with that I'd like to turn the call over to guilt page executive chair.
[laughter].
Thank you tranche.
Thank you all are going up today.
Speaking with you I think basically chair of the cancer Diagnostics Board of director.
The call whenever you have our corporate strategic pivot to address exactly and then.
President and Chief Executive Officer, we can't really well discuss the operational trends just we have made in order to execute the proximity and Chief Financial Officer, Neal Goldman would be California horizontal.
Core before we open the call for today.
And again, we must address telecom exactly pay them they are completely get dropping to five at our company as we know.
Well I mean, the dedication to the entire combined organization right.
Circumstances.
That's okay, then at Burger King with an opportunity to leverage our expertise the L. Society and drive significant new revenue for the there's no.
We had record quickly to make strategic shifts required to position the business to capture this opportunity.
I precise [laughter] the appropriate adjustments have been made at all [laughter] I can turn to health and safety of our wholly customer and community.
They were now even seen leading the transformation of Kenbei always feeling and your corporate culture and the organization.
A significant component of our transformation underway brewed coffee Renaissance.
We try to start to get out here in 2019 earnings call.
Yesterday, we had made strangers to increase it didnt see welfare a lot of call we'd rather than.
We will continue to develop as a proactive nimble and strategic organization they tend to ice the needs of our customers.
Right.
The level of quality across our products and services.
We are excited toward now but in the near future, we'll be watching new marketing MPR initiative to showcase degree bias.
Now I will take time for our strategic transition.
Well I write husband delegates evaluation, we took a neighborhood approach to address the needs of the kind of exciting testing market with a commercially viable solution, we identified a clinically significant opportunity to meet the needs of the market.
There are lots of parents and Craig blocker values as a company I forgot how close are the necessary coal [laughter] very kind of thinking.
The Barclays, we pivoted the organization focused on the development and commercialization.
Yeah.
But our expertise and it's actually pretty supportive care testing, we are fortunate to be ideally positioned to address specifically at all our valuable solutions for [laughter] called parents about this and other pending.
We already know entity that response in an expeditious manner as demonstrated by our philosophy, our country outright and now part of the nice thing.
[laughter] cheap, but our credit to our proprietary DPP technology, It's a hospital and fast lateral flow testing platform with the ability to multi site work our local Barker from a single patient sample.
We were confident that we had the technology and the team.
The bottom it's been during our two car technology offer capable of creating a premier antibody test.
And it really short period of time, we didn't know what could go to talk to you for a lot for testing system received after Yankee way and began shipping tests. It can work in the U.S. reveal.
Nicole <unk>, both portable Macquarie your Warren and like a reader to El Abra buyout produced by kept by Germany to read the past interest good things back up.
And our garden airports all.
And the mayor horrible LR perfection progression ever comes at the possibility of human error and enjoy kirkpatrick required with other passed in the market.
Please turn to allow for D., so a lot of testing and enable health care providers to utilize the system in a variety of health care location.
The highly contagious it fairly nice was it virus is changing the way people interact and folks in that every airline.
This situation, it's crazy names and expanded use cases for diagnostic testing.
We believe our past provides benefits like even do you suppose fingerstick blood quite 15 minutes test times with 15 second lead times I perspective any specificity.
Portable analog or they provide free numerical reis for both I think G.I.P.M. antibodies and this makes it probably vertical.
Applications for the DPP companies actually systematically improving outcomes for marketing effects are progressing in the girls community populations surveillance to determine herd immunity.
No I come back with potential therapeutic treatment.
And what was the vaccine development process.
Because the tariff changes they fingerstick blood sample the tests could be conducted.
Why karate thing they do not have significant infrastructure.
All of these features like an example pool in many existing markets. In addition to those that are working.
This call utility provides access to a diverse customer base.
These potential customer flying from various hospital departments, they tend to be health departments, and what 40 separates their physicians offices health clinic [laughter] Urban center.
Okay and nursing home.
Additionally, outside of the non healthcare arena, there has been interest from larger institution and employer at the world thinks about her path back to work and for individuals who would like to notice it didnt expired and their own immune status.
We're pleased to be experiencing significant demand from across these group.
Currently our focus is current customer for hospital lab, saying everybody else apartments in the region.
Most affected by the Pembina.
Our long term goal is to utilize this commentary and I think catalyst, which we hope because they can kinda back to fully realize the potential on the technology and the team behind it to not only for your Texas disease market, but it was for those opportunities that called net debt structure, We had bill we're saying I've precedented name.
And we're working hard for brokers that Oh, now, which serves our customers and our shareholders alike.
Yeah, I would like to try to call over to president and CEO for heavily to discuss further on hurdle operation.
Thank you Carol.
Yeah, that's been an incredible first six weeks in my new role as CEO.
My focus in the initial period began internally, but taking a deep dive into each functional team across the business.
From end to end I had been inspired by the skill and dedication every employee at this company.
We were facing a tremendous challenge and opportunity at a time a great uncertainty.
No. What does this organization has responded to pivot to focus on their code in 19 opportunity is truly impressive.
We have said hard tools for ourselves and we know how important our technology or is it combating just pandemic.
I'm pleased with where everyone is executed priorities above and beyond our aggressive goals.
Good morning, and the DPP technology and reputation for scientific Excellence is initially what attracted me to this company and its value has never been more evident.
And for the near term, we will remain focused on the transformational opportunity we haven't friends.
What's the DPP coordinating system, we have achieved three significant regulatory approvals one of the first that'd be a emergency use authorization or do you I.
Andrew Burns to use in Brazil, and most recently as announced today the CE Mark for Europe.
Through the regulatory approvals represent a war whatever the global Tennessee markets that can borrow is pursuing.
You don't see we're expanding our internal sales and marketing customer service and commercial infrastructure to meet the market demands workover 19th.
We're also discussions with major distributors in the United States and our distribution partners internationally to increase our presence in the global worked.
Our goal is to become to see the gold standard and de centralized huh.
Because we're the only after you see where your crude Fingerstick test.
We can penetrate many diverse markets.
To address this focus we have a three pronged strategy first.
Otherwise our internal feels group combined with her contract sales force.
Second what do you worry about relationships with key national distributors and third building partnerships with more strategic health care providers that can help accelerate entry into new channels, such as back to work programs.
Well the manufacturing front, we have shifted our manufacturing resources to focus on Cobot night, Cintas and Iraqi production to make as many tests as quickly as possible, while maintaining the quality the customers expect from combined.
This is an intricate process, but our systems were strategically is believed to be flexible as we have always a manufacturer test the border.
That's correct as early February the team was very proactive and ordering the needed bowls pretty for the increase in production.
Working with our supply base and sourcing the quality reagents needed to ensure we had plenty of supply to serve our production and resource needs for the early launch phase and beyond.
The manufacturing team has been working to incorporate all available resources to increase our capacity.
To me to meet the demands of the market.
While maintaining the quality we're known for.
Additionally, we've been hiring additional personnel to support a full second shift.
Expand or customer service.
I wouldn't mind, our goal is to produce 1 million Johnson Matt.
From here, we anticipate ramping production incrementally each month each month according to market demand.
The opportunity to scale third or will be contemplated as we have a better understanding a long term demand.
We have in design and we'll spend will seek to implement a capacity growth plan it tended to ramp production each month.
A recent target run rate of 2 million tests per month by the ended the third quarter 2020.
Our actual growing capacity will be talking market demand and other technical factors.
We're working closely with our suppliers when forecasting future requirements and through strong collaborative efforts and feel confident that or ability to acquire materials as we increase production.
We currently hold sufficient inventory or micro reader analyzers to satisfy these customers in the coming quarters, and we have coordinated with our German facility to synchronize analyzer production with the customer demand.
In January the team established key initiatives to serve the focus to drive profitable growth for the company.
These priorities include maximizing the infectious disease vertical, creating a formal R&D service vertical and tightening our cost structure.
And the first quarter, we generated total revenue of $6.9 billion and product revenue of $5.7 million decline on a 40%.
For the 20% and 14% respectively compared to the first quarter of the prior year.
We did experience disruption in the quarter as customers worldwide were affected by this pent up.
In the first quarter, we did not recognized or generate any revenue from the sale of Kobe Tonight seems systems.
There are many recent press reports about the proliferation of poor quality coordinate user all do test in the market.
And then the years not reviews or performance data.
We recognize that this is causing some confusion and damaging the perception of antibody testing in general.
We believe there might be pressure to remove all knowing it I hear you approve test from the market and we believe that would be are positive development for our health care system.
Well I was surprised has been reviewed by the U.S.T.A. after extensive U.S. based clinical evaluations.
The accuracy of the DPP covert Nike system. After 11 days post the onset of symptoms is 100% for total antibodies.
This is based on our data that was submitted to and reviewed by the yesterday for the U.S.
Jim Bio performed as rigorous clinical evaluations pretty yet I think you're used to you I get approval, that's Stony Brook University.
Following these evaluations in April 2014, Stony Brook Medicine selected our DPP Cokemaking system.
To recruit patients who have recovered from a cobot 19 in fashion to participate in that study.
This study is intended to determine if convalescent plasma which is the placidly people. Good recovered from Cowen 90 can help treat hospitalized patients with an active cobot 19 infection.
This cooperation followed stonework University hospitals receipt of after you approval the hopper convalescent plasma treatment to patients were randomized control study and is expected to enroll up to 540 patients from the long Island area.
The can probably with CPP Kroger Nike system is being used to confirm that patients where it started with cobot Nike and now have adequate levels of RPG antibodies.
It makes him eligible to donate convalescent plasma.
Study will set on safety and efficacy the use of convalescent plasma.
It's a standard plasma and hospitalized patients with a convert confirmed cobot 19 diagnosis.
In addition to the study mentioned above.
Just don't even want to work University also wondered took a study to evaluate over 500 healthcare workers, including doctors nurses in frontline responders to evaluate the accuracy of the DPP coordinating system.
We've been notified that the results of this second to none have been submitted to the journal of the American Medical Association for publication.
Oh, sorry, 19 area during the quarter, we received a 1.5 million dollar order from you from units, though for a more like Classico I am ICICI system and recently received subsequent 1.5 million dollar order from UNICEF for multiplexed Zika Junior and Dan.
So you have in Nigeria, ICICI systems, each quarter as part of the previously announced long term agreement with units, though and including the potential for an additional 2 million dollar ordered bringing the total one central values, the long term agreements to $7 million.
We're also pleased to report that we have completed the reproducibility study for our DPP HIV syphilis multiplex test the data was submitted to the FDA and will undergo their formal review.
Following the review, we will continue to pursue somebody associated CLIA waiver.
In the R&D services vertical chembios attracted and industry, leading organizations to conduct scientific development work.
We continue to make progress with our collaborators Astra Zeneca indicator pharmaceuticals.
As you can imagine these entities are also discovery there new news as it relates to testing for coordinated and their trial and this could present, an entirely new opportunity for cap on the technical feasibility study in collaboration with Takeda has been completed.
The incremental funding has been provided for the next phase with the program.
Now I'll turn the call over in the over the details of our first quarter financial performance.
Thanks, Rick and good afternoon, everyone.
First I would like to provide an update on a project Renaissance, which is our expense reduction program that we announced during our 2019 yearend conference call. We have taken measures to rightsize the organization reduced operating expenses and remove other non essential costs as part of this evaluation we have taken steps.
To retrench, our Malaysian facility and reduce the entire workforce there.
We're preserving our corporation in Malaysia, and our product registrations will remain active allowing for continuing operations if needed in the future at this time in Fas investment there is not enable a profitable growth upon which we are focused.
Based on these activities the company expects to record a restructuring charge ranging from $23.6 million. During the three months ended June Thirtyth 2020.
Now moving to the quarterly result.
Net product sales for the first quarter 2020 was $5.7 million a decrease of 13.7 per cent compared to the prior year quarter.
Three months ended March 31, 2020, total revenue was $6.9 million a decrease of 19.7 per cent compared to the prior year quarter.
License and royalty at R&D Grant revenues combined for the three months ended March 31, 2020 were $1.1 million a decrease of 40.4% compare to the prior year period.
R&D revenue was related to the timing and cadence or program performance applications, which do not always occur at a certain period, but we continue to incur certain expenses.
Compared to the three months that ended March 31, 2019, net product sales experience gains in Latin America in Asia. These were more than offset by lower sales in Africa, Europe, and the United States that we believe reflected in diversion in funding from HIV Dakotas 19.
The decrease in R&D and grant revenue was related to the completion of a BARDA funded programs that ran through 2019, excluding that BARDA program and focusing on what is described as exchange transactions in the footnote to our financial statements revenue from our R&D services vertical actually increased by 100.
$34000 were 17% compared to the prior year period.
Gross profit margins during the three months ended March 31, 2020 declined by $8.3 million compared to the prior year period. This corresponds to an 80 basis point decline for 24.3% into three months ended March 31, 20, 19% to 23.5% into three months ended March 30.
120 20 [noise].
The gross profit margin reduction resulted from a combination or the impact that fixed overhead on our overall lower product sales volume and unfavorable geographic mix on average selling prices.
Other expenses, which includes research and development and selling general and administrative expenses combined were $6.1 million for the three months ended March 31, 2020 compared to $6.2 million in the prior year period.
In cost declined modestly by point $3 million, selling general and administrative expenses increased $5.5 million or 12% for the three months ended March 31, 2020 compared to the prior year period, However point $4 million or the increase represent a onetime severance and related costs.
After an acquisition cost for a net after you get a increase a point $1 million or 4%.
Acquisition costs during the first quarter 2020, and 2019 correspond to the company's acquisition of Orange life in Africa, and the fourth quarters of 2019 and 2018, respectively.
The point 3 million dollar decrease in these costs related to the statutory auto requirement of Afrikaans pre acquisition financial statements that was not required for worthwhile.
Net loss in the three quarters ended March 31, 2020 was $5 million were 29 cents per diluted share compared to a net loss of $2.8 million or 16 cents per diluted share in the prior year period.
The balance sheet cash cash equivalents as of March 31, 2020 totaled $11.2 million net working capital as of December 31, 2019 was $19.8 billion.
Now I'll turn the call back to where for concluding remarks.
Thank you Neil.
As we touched on previously.
We expect Kobin 19 systems to drive significant incremental revenue in the future and will be a main driver the infectious disease vertical.
There was a very large market that has experienced exponential growth in the past month. It continues to unfold, many new markets, including interest from outside historical healthcare verticals, such as comedies with back to work programs.
We were very optimistic about this opportunity and confident in our ability to take submitted a significant share in this market and sustain a leadership position for the long term.
We were taking this opportunity would go to 19 to pivot the company into a high value diagnostics company, creating an R&D services vertical and expanding our commercialization strategy to focus on diversifying our products from low margin tend to driven products to higher value higher margin.
Products.
We are not abandoning our leadership in our base business.
It will build our future product portfolio office platform of our legacy products and technologies. The DPP Cobot 19 system is providing this opportunity for us.
So thank you for joining us today, and we look forward to updating you on our next call and with that we will now open it up two questions operator.
Thank you and to our phone audience joining today, if you would like to ask a question or need clarification on anything covered in today's conference call. Please press star and one.
From keypad, Oh from a reminder, that if you're joining us today on a speakerphone. Please return to your handset prior to pressing star and wanted to be sure that your signal does reach our equipment.
Ladies and gentleman that is star in one if you would like to ask alive question, we'll hear first from pair off one with Craig Hallum. Please go ahead.
Thank you good afternoon everybody.
Rick I want to start with your your comment about material revenue acceleration naturally.
This is top of mind for everybody.
In the absence of formal guidance and I'm sure a desire on on your part to remain very conservative.
I'm wondering if there was a way that we can get a sense of a visibility into the second quarter. If not you know it's not necessarily beyond that at this point simply if for no. Other reason because the range of outcomes here is incredibly stark you know we look at.
Seven Millionish number in Q1 and based on the production that you have at your disposal today and seemingly a lot of demand or the numbers for Q2 in Q3 could be.
Enormously higher so anything directionally on that front would be a great place to start thanks.
That's fair answered the question.
So you know, we got RV way approval three weeks ago.
So and we started a manufacturing at that point, a and gearing up manufacturing and we just started selling you know fell about a week ago. So.
We started shipping products in the U.S. about two weeks ago. So we're very very early on.
In the cycle, if you will post the launch the product.
So.
Oh I can say there is that at this point the demand is very very strong.
We're in a position right now that we were selling everything that we're manufacturing.
So we're pretty optimistic that as we gear up manufacturing.
And I laid out that data plan for you on the call. We're hopeful the demand will continue two to grow.
So as we as where capacity is spans we'll be able to sell everything we make.
As you know the uncertainty about the future demand is still a question.
But so far you know the initial demand from our early.
Watch plants part looks very strong.
Okay. Okay. That's helpful. It's it obviously great to know that you're selling everything you can you can make.
I'm on the point of that demand.
Curious and you alluded to it I think in prepared remarks here too but.
Like to get a little bit better handle on where that demand is coming from is it how much of its U.S. versus O U S. How might the CE mark influence or impact that.
And then as well as the end user or the end customer how is it sort of break it down between hospitals physician offices, the state local governments corporates and what have you.
[laughter].
You up here one right now we're seeing demand from across the market from hospitals to physicians office laboratories, a two state health Department at Citi Health departments.
I think if you've been reading you know all the information in the press I mean people just can't get their hands on and off test and so right now we're seeing demand coming in from pretty much every channel and so.
You are or future strategy is to as I've said expand or a distribution strategy to expand our internal selling effort ER and goes channels right now or are all open to us.
And I think as time goes along we'll look for if there's a particular news channel that we need to reinforced with either a distribution strategy or our own contract sales force.
We will add those as necessary.
Okay.
As far as the demand goes it is.
On the pricing side of things, it's remained relatively consistent with with what you've said on on some recent investor calls kind of that.
Ballpark 20 to $30 range per test.
That's what we're seeing in the market yes.
Yeah, we haven't seen or heard of any other changes to that to that price range coming in from from the market. So we're still still believing that that's the market range for the pricing.
Okay. My last one more on that I promise I'll, let somebody ask questions.
In light of the it and you mentioned that they can scale made it might have mentioned it in her remarks.
Relative noise out there about antibody testing and still the relative you know relatively small number you ways granted you know 10 11 of them into serological.
Well.
As far as I can tell your one of a few rapids, you're the only numerical result, near the only fingerstick, how how difficult is it to get that message out when there's so much other noise about other tests and maybe some other concerns about quality of other antibody test that are out there and there's a clear waiver makes sense for you at some point here.
Given you know what looks to be a relatively easy to use system. Thanks.
[noise] Gail.
I think it's important that the FDA has been tightening down all those that have done at the identification of backing got it I think what's really Andrew latest today.
And I think for a lot of those people on the call that Tommy early on one of the things we talked about whether there was a whole lot of noise in the market. They would read itself out I think now you're saying dependent on playing back I think there are three and our category that have the way and now we I just said, we're the only one fingerstick so I think part.
We're well positioned I still see a lot of those fall out yeah indication today, where they had 10 days to file for their emergency use authorization. So I think that's really going to change it get rid of a lot of the noises in the market.
Right that official for people like us that we may not necessarily be first but we anticipate the back in the market.
I would just add that we took a very measured approach you noted clinical studies, a which is why we got to fingerstick claim in or studies. So we we didn't raise to the FDA notification process. We took a measured approach makes you are critical valuations were strong with data look good and we had a differentiated features in the prior.
No that allows us to rolled out into a diverse market.
Very good just on the CLIA waiver, though is that it does that does that make sense kinda intermediate term a longer term to pursue that as well.
Oh, Yes of course, we're adopting oh, yeah with yesterday on what they were parts are gonna be locked up and well work collaboratively.
Great. Thank you I appreciate all the answers.
Thank you for your question here next we'll hear from Kyle Bowzer It Dougherty and company. Please go ahead caller your line is open.
Great. Thanks for taking the questions and congratulations on the progress over the last just two months here a lot of updates here.
And I appreciate the comments on the plans to manufacture 1 million tests. This month and eventually ramping up to 2 million per month by the into Q3 can you can you talk a bit about the makeup of the current capacity are you, making most of the test manually or his line one producing called the task now is it a mix.
[laughter].
Trial. This is rare Ah thanks for the question.
That's a that's a really great question. We are we were scaling our production using all of our resources.
With our manual production lines as well as or automated production line. So.
At this point, we have a manufacturing plant that we are right on schedule to root to reach the 1 million units in May and then ramp up 2 million units by the end of third quarter. So I think in my prepared remarks, I bet you were hiring additional people to to have.
The second shift.
And so right now we're using all manufacturing resources proposed for what we're adding to maintain that manufacturing plant.
Got it and then I believe the automated line three that you've talked about in the past is gonna be dedicated to take share check, but how about line too and went when might that be up and running for cold and will that be part of the incremental ramp to get to 2 million per.
<unk> by the end of Q3.
College Gail.
I think what I thought about all the heart check on and the communications. We've had a yeah. We have we're trying to make it back or we're tracking kind of it. So we don't want to get into too. Many specifics. The idea here is that we're going to utilize our automation, where it's needed we're going to utilize a semi automated where she is where we want to use it.
But the idea is that to achieve the ultimate manufacturing doll and right now how changing a lot. So we're trying not to get wrapped up into at the bottom one watching semi automated the point isn't that we're about algorithms. We've got a break manufacturing Craig and the idea is to get these pennsylvania factored into very high quality a situation.
Got it now it's fair to kind of dig in and the we tier I think the takeaways that you're going to be doing 1 million. This month ramping to 2 million per month. So that's great.
Regarding the F.D.A. coming out today and now expecting had you talked about antibody test developers to file for you Ace its clearly benefit for Ken bio the updates always also going to require these developers to hit a minimum accuracy threshold. So well, we'll see a lot of these competitors drop off.
The market I imagine even more than what we already seen and since you put together a pretty comprehensive application for the way seems like it's could be leveraged for subsequent applications can you talk about any potential plans to file a formal five 10-K and potentially multiplex test that could be used on the season.
No basis, it seems like there'd be an opportunity to leverage funding from someplace like BARDA for for test like this thanks.
Okay great.
I speak to that today.
Hi, guys, Yes, we have a plan to move forward with popping cats as we discussed also is what parts of over eight years away. We do have also auto pulled off under development. That's exactly what is that that's what that back again.
Got it got it thanks, and then not just lastly, if I may you you talked about in the prepared remarks, a little bit about being in discussion with major distributors in the U.S.
You know can you talk about exclusivity that you already had in place with current partners in and just any other color about you know how you're thinking about partnering with someone else in the U.S.
Oh, Yeah two cars.
We have a previous sort of distributors that weve used in the past for our core products. So we're in discussions with our U.S. distributors as wells are international distributors and a as we made progress in those discussions. So we will we will make that public.
Okay. Thanks for taking my questions [laughter] that Carl.
Maxim Suji Canaccord Genuity, Hello, and good afternoon. Your line is open.
Hello, This is actually donnel on for Matt Sushi, Thanks for taking the question.
Patrick [laughter] [noise].
So looking at his first off when so many of the contracts you're signing with customers for your astrology test how should we think about the duration of these contracts and are there any requirements for a minimum purchasing agreements whether that be weekly monthly or annually.
That's true.
Yeah, Patrick this is Rick.
Thanks for the question, it's really too early to answer that question.
The only because you know right now the Didnt as I said before a the demand coming in from the market is meeting is exceeding our capacity so.
At this point Oh, we are taking minimum order quantities.
As a part of her strategy to ensure that no customers are getting an adequate supply, but not too much or too little so but right. Now you know from a contracting perspective, you know we're not it we're not at that level and as we move forward.
Customers want to contract we will entertain that.
Thank you. Thank you and then one more question most of the focus for this role would you test opportunity has been looking at the United States, but this is a global pandemic and as you mentioned you have relations, including the 4 million dollar contract in Brazil. So could you provide any color and how we should look that internet.
National demand for your testing.
Well were.
The other one of the reasons, we've got to see markets, because we're seeing a tremendous demand coming from Europe.
In Brazil, we the company has had a longstanding excellent relationship with the Ministry of Health and they were the first and move in terms of and Anvisa approval. So you know we had distribution partners around the World Latin America, Europe Asia, and we're in discussions with those distribution partners in and in some new.
Additional distribution partners to hold reached the demand not only here in United States, but internationally.
Thank you.
Next we'll hear from Bruce Jackson with the benchmark company fibers.
Hi, good afternoon, and thank you for taking my questions first on the order for Brazil did you ship the entire order or just part of it.
[noise] the weather.
I wonder what submission to the seamless chip over a period of time and where the shipping partly a purchase order outlined now.
Okay.
And my my second question is about the at the numeric result, and the ability to measure antibody titer.
He is potentially a quantitative result can you make any quantitative claims do you plan on getting any labeling for that and then if you could just generally comment on the important so I'm doing that I'd appreciate it.
Hi, This is giovanni and even on a pretty quantitative I'll call. It can be one state. If you then you have to be kind of Greg four by four out these boys like a semi quantitative measure a is that maybe let alone died humanized UGI. That's why we can provide do that so.
We do funding our it yeah, I have you and penetration value, which was very useful for that pulled down the rig once told me about nickel by dozens of screening because it was very helpful back to show that live Lubarsky GE the selection criteria.
Alright, Thank you for taking my questions and congratulations on all good progress.
That covers.
[noise] and this is the operator at this time I'll turn it back do you reckon, our leadership team for any additional or closing remarks.
All right I just wanted to thank everyone for joining us today and are we look forward to our next update it had a great day. Thank you.
Ladies and gentlemen, this does conclude todays conference and we thank you all for your participation. You may now disconnect. Your lines, we hope that you have a great day.
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