Q1 2024 Accelerate Diagnostics Inc Earnings Call

Operator: Good day, and welcome to the Accelerate Diagnostics Incorporated first quarter 2024 results conference call. All participants will be in a listen-only mode.

Good day and welcome to the accelerate diagnostics incorporated first quarter 2024 results conference call. All participants will be in a listen only mode. After today's presentation, there will be an opportunity to ask questions, what they're covering analyst I would now like to turn the conference over to MS. Laura Pierson of accelerate diagnostics. Please go ahead.

Laura Pierson: After today's presentation, there will be an opportunity to ask questions with our covering analysts. I would now like to turn the conference over to Ms. Laura Pierson of Accelerate Diagnostics. Please go ahead, Ms. Pierson.

Laura Pierson: Ma'am.

Laura Pierson: Before we begin, it is important to share that information presented during this call may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements include projections, statements about our future, and those that are not historical facts. All forward-looking statements made during this conference call are subject to risk, uncertainties, and other factors that could cause our actual results to differ materially.

Laura Pierson: Before we begin it is important to share that information presented during this call may contain forward looking statements within the meaning of section 27, a of the Securities Act of 1933 and section 21 E of the Securities Exchange Act of 1934.

Laura Pierson: Forward looking statements include projections statements about our future and those that are not historical facts. All forward looking statements are made during this conference call are subject to risks uncertainties and other factors that could cause our actual results to differ materially. These are discussed in greater detail in our annual report on form 10.

Laura Pierson: These are discussed in greater detail in our annual report on Form 10-K for the year ended December 31, 2023, and other reports we file with the SEC. It is my pleasure to now introduce the company's president and CEO, Jack Phillips.

Jack Phillips: K for the year ended December 31st 2023, and other reports, we file with the SEC it.

Jack Phillips: It is my pleasure to introduce the company's president and CEO Jack <unk>.

Jack Phillips: Thank you, Laura. Good afternoon. Today, I would like to provide a detailed update on the WAVE program. But before I provide my update, I will pass it on to David Patience, our CFO, to summarize our financial results for the quarter.

Jack Phillips: Thank you Laura good afternoon today, I would like to provide a detailed update on the waiver program.

David Patience: Before I provide my update I will pass it on to David patience, our CFO to summarize our financial results for the quarter.

David Patience: Thank you, Jack, and good afternoon, everyone. Net sales were approximately $2.9 million for the quarter, which compares to approximately $2.8 million for the same period in the prior year. This was driven by an increase in reoccurring consumable net sales. Gross margin was approximately 25% for the quarter, which compares to approximately 36% for the same period in the prior year. The overall decline in gross margin was driven by product mix. Selling, general, and administrative expenses were approximately $5.7 million for the quarter, which compares to $10.1 million for the same period in the prior year.

David Patience: Thank you Jack and good afternoon, everyone net sales for approximately $2 9 million for the quarter, which compares to approximately $2 8 million for the same period in the prior year.

David Patience: The SG&A expenses for the quarter include approximately $900,000 in non-CAS stock-based compensation. The overall decline in SG&A expenses was primarily due to lower employee-related expenses in the current period, as well as non-recurring legal and advisory-related expenses in the prior period. Research and development expenses were $5.2 million for the quarter, which compares to $7 million for the same period in the prior year. R&D expenses for the quarter included approximately $400,000 in non-CAS stock-based compensation.

David Patience: This was driven by an increase in reoccurring consumable net sales.

David Patience: Gross margin was approximately 25% for the quarter, which compares to approximately 36% for the same period in the prior year.

David Patience: The overall decline in gross margin was driven by product mix.

David Patience: Selling general and administrative expenses were approximately $5 7 million for the quarter, which compares to 10.1 million for the same period in the prior year.

David Patience: SG&A expenses for the quarter include approximately 900000 and noncash stock based compensation. The overall decline in SG&A expenses were primarily due to lower employee related expenses in the current period as well as nonrecurring legal and advisory related expenses in the prior period.

David Patience: Research and development expenses were $5 2 million for the quarter, which compares to $7 million for the same period in the prior year R&D expenses for the quarter included approximately 400000 in noncash stock based compensation.

David Patience: The overall decline in R&D expenses resulted primarily due to both lower employee-related expenses as well as lower third-party development expenses for our WAVE program. Our net loss for the quarter was approximately $14.2 million, resulting in a loss per share of 74 cents. Cash used for the quarter was approximately $9 million, excluding cash raised related to our January equity offering. Our cash used for the quarter includes over $1 million in prepaid annual expenses. As discussed on previous calls, we are focused on driving significant reductions in operating expenses and cash burn in the coming quarter. Now back to Jack to discuss our exciting innovation with WAVE.

David Patience: The overall decline in R&D expenses resulted primarily due to both lower employee related expenses as well as lower third party development expenses for a wave program.

David Patience: Our net loss for the quarter was approximately $14 2 million, resulting in a loss per share of <unk> 74 cents.

David Patience: Cash used for the quarter was approximately $9 million, excluding cash raised related to our January equity offering our cash used for the quarter includes over a million and prepaid annual expenses.

David Patience: As discussed on previous calls we are focused on driving significant reductions in operating expenses and cash burn in the coming quarters.

David Patience: Now back to Jack to discuss our exciting innovation with wave.

Jack Phillips: Thanks, David. As discussed during our last earnings call, Accelerate is uniquely positioned to disrupt the microbiology susceptibility testing market, surpassing emerging positive blood culture and traditional isolated colony systems. The global antibiotic susceptibility testing market is estimated at close to $2 billion and growing at about 6% annually. Divided into two segments, the PBC market represents about $800 million, with the isolate market at approximately $1 billion.

Jack Phillips: Thanks, David as discussed during our last earnings call accelerate is uniquely positioned to disrupt the microbiology susceptibility testing market, surpassing emerging positive blood culture and traditional isolated colony systems. The global antibiotic susceptibility testing market is estimated.

Jack Phillips: At close to $2 billion and growing at about 6% annually.

Jack Phillips: Abided into two segments, the PBC market represents about $800 million with the isolate market at approximately $1 billion.

Jack Phillips: Wave offers a consolidated platform that can process both PBC and isolate specimens on the same instrument. Further key product differentiators include same-shift results, scalability, high-throughput workflow, and profitable cost structures. We received positive feedback and strong interest in WAVE during the European Society of Clinical Microbiology and Infectious Disease Conference earlier this month. Our team presented several technical posters on WAVE. Accelerate was also chosen to participate in a session on breakthrough innovation in microbiology. One of our leading scientists presented an oral presentation focused on the unique benefits of holographic imaging technology deployed on the WAVE system.

Jack Phillips: <unk> offers a consolidated platform that can process, both PBC and isolate specimens on the same instrument further key product Differentiators include same shift results scalability high throughput workflow and profitable cost structures.

Jack Phillips: We received positive feedback and strong interest in waves during the European Society of clinical microbiology and infectious disease conference earlier this month.

Jack Phillips: Our team presented several technical posters on wave.

Jack Phillips: Accelerate was also chosen to participate in a session on breakthrough innovation and microbiology, one of our leading scientists presented in oral presentation focused on the unique benefits of holographic imaging technology deployed on the wave system.

Jack Phillips: Enthusiasm continues to grow from current and prospective customers. Moving to our preclinical trial, we have incurred an installation delay at our second preclinical site due to final site contracting, and as a result, the preclinical study is still ongoing. However, we continue to target starting our clinical trial towards the end of the second quarter. No IVD clinical trial and FDA submission is without risk, but we feel confident in our team and ability to manage technical and timeline risk.

Jack Phillips: Enthusiasm continues to grow from current and prospective customers.

Jack Phillips: Moving to our preclinical trial, we've incurred an installation delay at our second preclinical site due to final site contracting and as a result, the preclinical study is still ongoing however, we continue to target starting our clinical trial towards the end of the second quarter.

Jack Phillips: No IBD clinical trial, and FDA submission is without risk, but we feel confident in our team and ability to manage technical and timeline risks.

Jack Phillips: In parallel to the clinical trial work, we are developing our gram-positive PBC menu. Once completed, this will round out our PBC menu before moving on to the high-volume isolate testing segment. Now turning to our WAVE commercial strategy. The first step in our three-step commercialization strategy is to extend our leadership in the rapid PBC-AST market. To this end, we continue to present WAVE to our current base of loyal customers and secure long-term rapid susceptibility testing contracts. The interest in WAVE remains very high due to its differentiated and highly valued features. Microbiologists, pharmacists, and clinicians alike understand that same-shift reporting enables critical therapeutic adjustments that improve patient care and hospital economics.

Jack Phillips: In parallel to the clinical trial work, we are developing our gram positive PBC menu. Once completed this will round out our PBC menu before moving on to the high volume isolate testing segment.

Jack Phillips: Now turning to our wave commercial strategy. The first step in our three step commercialization strategy is to extend our leadership in the rapid P. B C. A S T market.

Jack Phillips: To this end, we continue to present wave to our current base of loyal customers and secure long term rapid susceptibility testing contracts. The interest in wave remains very high due to its differentiated and highly valued features microbiologist pharmacists and clinicians alike.

Jack Phillips: Understand same shift reporting enables critical therapeutic adjustments, which improve patient care and hospital economics.

Jack Phillips: In addition to our ongoing discussions with our existing customer base in both the U.S. and EMEA, we continue to present WAVE and its unique benefits to over 500 accounts in our sales funnel. We remain focused on launching WAVE and converting our existing customers as this provides a commercial platform for not only quick wins, but it also reduces our overall cash burn with an increased margin contribution per customer. Additionally, we submitted our 510K to the FDA for our AHRQ system, which is the first automated PBC sample preparation method to enable rapid PBCID on Bruker's MALDI biotyper instrument.

Jack Phillips: In addition to our ongoing discussions with our existing customer base in both the U S and EMEA, we continue to present wave and its unique benefits to over 500 accounts in our sales funnel, we remain focused on launching wave and converting our existing customers. As this provides a commercial platform for <unk>.

Jack Phillips: Not only quick wins, but it also reduces our overall cash burn with an increased margin contribution per customer.

Jack Phillips: Additionally, we submitted our five 10-K to the FDA for our arc system, which is the first automated PVC sample preparation method.

Jack Phillips: To enable rapid P. B C I D on brokers moldy <unk> instruments.

Jack Phillips: This will give customers another option for RapidID and will complement WAVE. The second step of our commercialization strategy is to expand our available market by launching an isolate menu on the same instrument already in the lab, producing PBC susceptibility results. Wave will deliver rapid, same-shift isolate results with a competitive cost structure and one of the largest up-to-date drug menus available compared to legacy isolate platforms. The last step in our commercial strategy is to pursue both Geographic and Technology Expansion.

Jack Phillips: This will give customers another option for rapid I'd.

Jack Phillips: And we'll complement wave.

Jack Phillips: The second step of our commercialization strategy is to expand our available market by launching an isolate menu on the same instrument already in the lab producing PVC susceptibility results wave will deliver rapid same shift isolate results with a competitive.

Jack Phillips: Cost structure and one of the largest up to date drug menus available compared to legacy isolate platforms.

Jack Phillips: The last step in our commercial strategy is to pursue both geographic and technology expansion along with our commercial partner our goal will be to expand beyond the U S and EMEA to be a true global provider of rapid I'd E. A S T solutions we.

Jack Phillips: Along with a commercial partner, our goal will be to expand beyond the U.S. and EMEA to be a true global provider of rapid ID AST solutions. We will also be expanding the AST menu with more esoteric microorganisms and partnering with pharmaceutical companies to further enable their drug discovery. Also, we envision numerous applications of holographic imaging outside of rapid susceptibility testing, which we plan to pursue.

Jack Phillips: We will also be expanding the S. T menu with more esoteric micro organisms and partnering with pharmaceutical companies to further enable their drug discovery.

Jack Phillips: Also we envision numerous applications of holographic imaging outside of rapid susceptibility testing, which we plan to pursue.

Jack Phillips: And finally, as discussed on our prior call in late March, an important part of our strategy is signing a global partnership to commercialize our innovation with Waze. We continue to have robust interest in multiple partners. We remain confident in our ability to secure a partnership by mid-year. In summary, we continue to make progress on WAVE timelines and deliverables. We are excited about the next phase of clinical trials and the FDA submission later this year. Our experience in the market and strong customer base will position us for early success with WAVE upon launch. At this time, I'm happy to take any questions from our covering analysts.

Jack Phillips: And finally as discussed on our prior call in late March and important part of our strategy is signing a global partnership to commercialize our innovation with wave. We continue to have robust interest in multiple partners. We remain confident in our ability to secure a partnership by mid year.

Jack Phillips: In summary, we continue to make progress on wave timelines and deliverables. We are excited about the next phase of clinical trials and the FDA submission later this year our experience in the market and strong customer base will position us for early success with wave upon launch.

Speaker Change: At this time I'm happy to take any questions from our covering analysts.

Operator: We will now begin the question and answer session, and the first question will come from Dustin Scaringe with William Blear. Please go ahead, sir.

Jack Phillips: We will now begin the question and answer session and the first question will come from Dustin <unk> with William Blair. Please go ahead Sir.

Dustin G. Scaringe: Hey guys, thanks for taking our questions, and I appreciate all the color on WAVE. Just wondering if there's any more details you can provide on the conversations you're having with potential customers and how these customers are viewing WAVE versus other competing solutions out there.

Dustin G. Scaringe: Hey, guys. Thanks for taking our questions.

Dustin G. Scaringe: I appreciate all the color on wave.

Dustin G. Scaringe: Just wondering if there's any more details you can provide on the conversations you are having with potential customers and how these customers are viewing where you versus other competing solutions out there.

Jack Phillips: Yeah, hi, Dustin. Yeah, I'll take that one for us.

Speaker Change: Yeah, Hi, Justin I'll.

Dustin G. Scaringe: I'll take that one for us.

Dustin: Yeah as I as I said in my comment prepare repaired remarks prepared remarks, we continue to have a lot of dialogue with customers on wave, where adjusted Akhmed, where we met with customers that was in Barcelona, Spain, and then on a regular daily and weekly basis, We review the wave.

Jack Phillips: Yeah, as I said in my prepared remarks, we continue to have a lot of dialogue with customers on WAVE. We were just at ECMED, where we met with customers. That was in Barcelona, Spain.

Jack Phillips: And then, on a regular daily and weekly basis, we review the WAVE portfolio with our customers and prospective customers, up to about 500 in our funnel right now. And the feedback is quite consistent. One, the fact that we have a high-throughput, random-access, scalable system that integrates high-volume testing like the isolate market testing and RapidPBC in one platform is a very big deal. Secondly, the fact that we're seeing results today in about four hours, which really will be the gold standard.

Jack Phillips: Portfolio with our customers and prospective customers up to about 500, and our funnel right now.

Jack Phillips: And and the feedback is quite consistent one the fact that we have a high throughput random access scalable system that integrates high volume testing like like the isolate market testing and rapid PVC in one platform is a very big deal.

Jack Phillips: Secondly, the fact that we're seeing results today in about four hours.

Jack Phillips: Which is.

Jack Phillips: Really will be the gold standard I mean today.

Jack Phillips: I mean, today, Fino lasts about eight hours, and the systems that have been approved on the market, on average, are around that as well. And then finally, the ability for the high-volume throughput system for us to be able to compete on a price point in the isolate market; we do believe we can redefine the isolate market because of the speed to result of around four hours versus overnight today for many of the legacy platforms.

Jack Phillips: <unk> is about eight hours and the systems that have been approved on the market on average are around that as well and then finally the ability for the high volume.

Jack Phillips: <unk> throughput system to for us to be able to compete on a on a price point in the isolate market. We do believe we can restate the isolate market because of the speed to result of <unk>.

Jack Phillips: <unk> four hours versus overnight today for many of our legacy platforms.

Jack Phillips: But all in all, we will be very competitive there and also competitive in the PBC pricing area as well. That resonates strongly as well. And again, we're getting a lot of consistent positive feedback, and we've continued to secure customers, the existing customers on long-term contracts, and they're also starting to request upgrade clauses in their current contracts as WAVE becomes available.

Jack Phillips: All in all we will be very competitive there and also competitive in the PBC pricing area as well that resonates strongly as well and again, we're getting a lot of consistent positive feedback and we've continued to secure customers. The existing customers are long term contracts and they're all.

Jack Phillips: So starting to request.

Jack Phillips: Upgrade clauses in their current contracts as wave becomes available.

Jack Phillips: Great, that actually goes to my next question. Good to see that the percentage of customers went up to 70%. But when you actually get waived out with ARC, how would that transition look like? from a typical Fino customer to these new products?

Speaker Change: Great that actually goes to my next question good to see that the percentage of customers went up to 70%.

Speaker Change: But when you actually get way about with or how would that transition look like.

Jack Phillips: From a typical female customer to these new products.

Jack Phillips: Yeah, so exactly, a good question. So we're working on that right now.

Speaker Change: Yes so.

Speaker Change: Exactly good question. So we're working on that right now there is basically one of the beauties of wave is that we're going to give customers optionality relative to the rapid I'd solution. So for example, some customers already have a molecular platform that.

Jack Phillips: There's basically one of the beauties of WAVE is that we're gonna give customers optionality relative to the RapidID solution. So, for example, some customers already have a molecular platform that does RapidPBCID, and they've already made the decision that it's the ID platform that they prefer to use into the future, coupled with WAVE for rapid susceptibility. Other customers have MALDI platforms, and many, many microbiology labs today are now equipped with MALDI platforms because it is a growing segment.

Jack Phillips: Does rapid PBC I D and they've already made the decision that's the platform that they prefer to use into the future coupled.

Jack Phillips: Coupled with wave four four rapid susceptibility.

Jack Phillips: Other customers have multi platforms.

Jack Phillips: And many many microbiology labs today now are equipped with multi platform because it is a growing growing segment.

Jack Phillips: Those customers are very excited about the opportunity to produce MALDI in a rapid fashion by integrating ARC into their workflow. ARC will basically provide the opportunity for those customers to get a RapidID off of MALDI in an hour or two versus today; MALDI ID takes, you know, it's an overnight process. And so those customers will be transitioning to a complete solution with ARC plus BioType or MALDI plus the WAVE susceptibility system. And again, that's, so we're really covering all the bases there and having these conversations, and they've been, again, very positive to date.

Jack Phillips: Those customers are very excited about the opportunity.

Jack Phillips: To produce small D in a rapid fashion by integrating <unk> into their workflow arc will basically provide the opportunity for those customers to get a rapid IV off of malty in an hour or two versus today multi.

Jack Phillips: It takes.

Jack Phillips: It's an overnight process.

Jack Phillips: And so those customers will be transitioning to a complete solution with arc, plus biotech or moldy plus the wave susceptibility system and again, that's that's so we're really covering all the bases there and having these dialogues and they've been.

Jack Phillips: Again very positive to date.

Speaker Change: That's great to hear.

Jack Phillips: That's great to hear. Around AHRQ, I was just wondering if we could get an update on how the Brooker collaboration has been going and how this is bringing greater awareness to Accelerate's entire portfolio of products.

Speaker Change: Around or just wondering if we can get an update on how the collaboration has been going.

Jack Phillips: And how this is bringing greater awareness to accelerate the entire portfolio of products, including wave.

Jack Phillips: Yes, I am so sure. So our collaboration with Bruker is extremely positive, and we have a partnership with them to, the partnership is basically to, you know, develop AHRQ with their biotypes or platforms that they have. We've successfully done that, and we've submitted, as I mentioned in my prepared remarks, we submitted that to the FDA. We've already received comments back from the FDA, and we've responded to those, and so the bottom line is that AHRQ is under review today, and we expect to hear back from the FDA in the coming weeks and then be able to further determine when we believe we'll be successful in getting AHRQ on the market in the U.S.

Jack Phillips: Yes, so sure so our collaboration with broker is extremely positive and we have a partnership with them to the partnership is basically too.

Jack Phillips: You know developed arc with their bio type of platforms that they have we've successfully done that and we've submitted as I as I mentioned in my prepared remarks, we submitted that to the FDA we've already received.

Jack Phillips: Comments back from the FDA and and we've responded to those and so bottom line is is the arc is under review today, and we expect to hear back from the FDA.

Jack Phillips: In the coming weeks, and then be able to further determined when we believe.

Jack Phillips: We will be successful in getting arc on the market in the U S.

Jack Phillips: Understood.

Speaker Change: And then just one last one for us.

Dustin G. Scaringe: And then just one last one for us. The collaboration you have with BD, I was wondering if you could talk about any stage progression, you know, funnel velocity, and what this is doing to enhance placements with phenol for future products. Thank you.

Jack Phillips: The collaboration you have with <unk>.

Speaker Change: Just wondering if you can talk about.

Speaker Change: Any stage progression funnel velocity.

Dustin G. Scaringe: And what this is doing to enhance placements.

Dustin G. Scaringe: With her.

Dustin G. Scaringe: For future products. Thank you, yes, absolutely I'm going to let David David patients take that one for US. Thanks test and I. Appreciate the question. So in the quarter, we contracted 12, new Pheno instruments and brought another eight instruments lives. So we further.

David Patience: Yeah, absolutely. I'm going to let David Patience take that one for us. Thanks, Dustin. I appreciate the question.

David Patience: Thanks, Dustin. I appreciate the question. So in the quarter, we contracted 12 new pheno-instruments and brought another eight instruments live. So we are further able to penetrate the U.S. market for rapid susceptibility testing for positive blood cultures, which is, you know, an important competitive moat for us with emerging competitors. You know, we see progress with the BD Partnership and them getting comfortable selling rapid susceptibility, while we're also fortifying our existing loyal customer base, as we discussed earlier.

David Patience: We're able to further penetrate the U S market for rapid susceptibility testing for positive blood culture, which as you know.

David Patience: Cortlandt competitive moat for us.

David Patience: With emerging competitors.

David Patience: We see progress with the BD partnership in them getting comfortable selling rapid susceptibility. While we're also fortifying our existing loyal customer base as we discussed earlier both are key in our launch of wave as you know as Jack mentioned, we are looking to further.

David Patience: Both are key in our launch of WAVE. As you know, as Jack mentioned, we are looking to further improve our economics per customer with WAVE. And so securing new customers with BD while also preparing our existing customer base for a WAVE transition are both strategically important to us.

David Patience: Improve our economics for our customer and with wave and so securing new customers with BD, while also preparing our existing customer base for a wave transition are both strategically important to us.

Dustin G. Scaringe: Okay, great. Thank you, David. That's it from us.

Speaker Change: Okay, great. Thank you David that's it from us.

Speaker Change: Thanks Dustin.

Operator: This concludes our question and answer session. I would like to turn the conference back over to Mr. Jack Phillips for any closing remarks. Please go ahead.

Dustin G. Scaringe: This concludes our question and answer session I would like to turn the conference back over to Mr. Jack Phillips for any closing remarks. Please go ahead.

Jack Phillips: Sure, thank you. You know, in summary, we've made very good progress in several areas this quarter. I'm really proud of our team and what we've accomplished. To highlight some of those, as David mentioned, we added 12 new rapid AST systems in the quarter in conjunction with our partner BD. We executed contract extensions with several strategic U.S. customers, which will secure approximately 70% of Accelerate's customer base on longer-term contracts for WAVE.

Jack Phillips: Sure. Thank you.

Jack Phillips: In summary, we've made very good progress in several areas in the quarter I'm really proud of our team and what we've accomplished.

Jack Phillips: As as highlighting some of those as David mentioned, we added 12, new rapid ASP systems in the quarter in conjunction with our partner BD, we executed contract extensions with several strategic U S customers, which will secure approximately 70% of accelerates customer.

Jack Phillips: <unk> base to longer term contracts for wave.

Jack Phillips: We successfully submitted a 510K through the FDA for AHRQ, and, as I mentioned prior, we received confirmation already, and our submission is currently under review. And then the WAVE program, we continue to make great progress. The preclinical trial remains underway. We're targeting still to begin clinical trials in late quarter two. And we've also begun development of the Gram-Positive PBC menu.

Jack Phillips: We successfully submitted a 500 10-K through the FDA for arc and we as I mentioned prior we received confirmation already in our submission is currently under review.

Jack Phillips: And then the way program, we continue to make great progress.

Jack Phillips: Preclinical trial remains underway.

Jack Phillips: We're targeting still to begin clinical trials in late quarter two.

Jack Phillips: And we've also began development of Gram positive Gram positive PBC menu. So lot of good things happening there on the wavefront.

Jack Phillips: So a lot of good things are happening there on the WAVE front. And then, as David highlighted, we continue to implement initiatives to improve our cash burn and extend our runway. So that's going very well as well. I want to say thank you very much for tuning in to our Q1 earnings call. We appreciate your interest in Accelerate, and I wish you a great day. The conference has now concluded. Thank you for attending today's presentation. You may now...

Jack Phillips: And then finally as David highlighted we continued to implement initiatives to improve our cash burn and extend our runway.

Jack Phillips: So that's going very well as well.

Jack Phillips: I want to say, thank you very much for turning tuning into our Q1 earnings call. We appreciate your interest and accelerate and I wish you a great day.

Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

Jack Phillips: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.

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