Q3 2024 ProPhase Labs Inc Earnings Call
Presentation.
Noah: My name is Noah, let Alexandria, virtual that moderator here, but mark financial communications.
Noah: On behalf of our team we'd like to thank everyone for joining us today for the presentation of prophase labs that for the third quarter 2024 results.
Noah: Propane is trading on the NASDAQ under the ticker symbol P. R. P H.
Noah: Presenting today is Ted carcass, Chairman and Chief Executive Officer present.
A presentation following the presentation will be a Q&A session, which can participate using the chat box in the top right hand corner of your screen and with that being said I will now handle her over to Ted.
Ted Carcass: Thanks, Noel and thanks, everybody for joining today I always give a shout out to rent Mark to start we do a virtual non deal roadshow presentation. Just like this every month. So if you want to if you're a new shareholder absolutely I recommend you sign up with brand Mark.
Ted Carcass: And I loved updating shareholders once a month.
Ted Carcass: And <unk> has a schedule for that.
Ted Carcass: Before I get started I have to of course read the forward looking statement.
Ted Carcass: Let me get through this quickly before we get started I would like to remind you of the company's safe Harbor language. During this presentation, we will make forward looking statements, including statements regarding our strategy plans objectives and initiatives and underlying assumptions. While we believe that these forward looking statements are reasonable as and when made forward looking statements are based on expectations that involve risks and <unk>.
Ted Carcass: Certainties that could cause actual results to differ materially. These risks and uncertainties include but are not limited to our ability to obtain and maintain necessary regulatory approval general economic conditions consumer demand for our products and services challenges relating to entering into and growing new business line, the competitive environment and the risk factors lift.
Ted Carcass: From time to time in our filings with the SEC.
Ted Carcass: This call will present non-GAAP financial message such as adjusted EBITDA reconciliation of these non-GAAP measures to the most comparable GAAP measures are included in the earnings release furnished to the SEC prior to this call and available on our website.
Ted Carcass: Okay.
Ted Carcass: No.
Ted Carcass: I wanted to start I am going to get into the subsidiaries in our presentation.
Speaker Change: Noelle it could you blow up the investor presentation screen larger please.
Speaker Change: It's small on my screen I assume it's larger.
Speaker Change: It is larger for the viewers okay, great. Okay. So look.
Speaker Change: I wanted to start and get it out of the way I wanted to talk about the capital raise and then spend our time.
Speaker Change: Focus on bringing you all up to date on our many initiatives that have so much potential as.
As far as the capital raise is concerned I wanted to seize the opportunity to have an aggressive launch for DNA complete and DNA expand to take advantage of the holiday season.
Speaker Change: Advertising for Black Friday has already begun this is one of the best times of the year for selling DNA and products and services. They are great for gift, giving and a significant percentage of our annual sales at the same time PMI is ramping up aggressively if you think about it purchasing more packaging more than.
Speaker Change: Greetings.
Speaker Change: Manufacturing more product, we're really ramping up aggressively right now.
Speaker Change: Adding more shifts adding more labor it all adds up very quickly Meanwhile, invoicing to customers and receiving payments from our customers can be months behind so it can create a cash flow imbalance I don't think anybody on this call would want me to hurt our fourth quarter by not having the capital.
Speaker Change: To support.
Speaker Change: Our subsidiaries that have such tremendous growth potential and.
Speaker Change: In fact in the case of PMI growing so strongly and robustly right now.
Speaker Change: It's just the timing of the year that I want to take advantage of I want to have a strong fourth quarter.
Speaker Change: And that's my anticipation that's my that's my goal.
Speaker Change: I'm the largest shareholder in the company. So the capital raise effects me as much or more than anyone else I made an executive decision.
Speaker Change: And believe that in hindsight, a few months from now when we report Q4.
Speaker Change: Will prove to be a two have been the best decision.
I'll also mention that our investment bankers are 45 days to exercise the.
Speaker Change: The 15% Green shoot.
Speaker Change: For those of you that don't understand about capital raises the green shoe is meant to support.
Speaker Change: The stock price and the aftermarket after the capital raise has been done if that support is needed after 45 days.
Speaker Change: Instead of covering the short that extra 15% is provided to the company.
They exercised our investment bankers exercised the green shoe the same day.
Speaker Change: Which is highly unusual obviously, our bankers are very bullish.
Speaker Change: Plenty of buyers in the aftermarket we're not the least of concerned about meeting the green shoots to support the stock price and.
Speaker Change: And finally and proactively working out a plan to reduce overhead and other expenses by at least $6 million.
Speaker Change: Which may include satisfaction of more than $5 million in payables I anticipate this plan going into effect before the end of the year.
Speaker Change: At the same time, we anticipate at least $5 million in earnings next year for formalized.
Speaker Change: These two items alone will provide an 11 million dollar real cash earnings swing to the positive for our company just on these two items alone having nothing to do with the other subsidiaries that are all growing.
In addition, potentially reducing $5 million or more and our payables, which would be a part of this initiative I am working on.
In fact, so I can't go into more details right now, but I would anticipate long.
Speaker Change: Long before year end I should have a very nice update about all of this for all of you.
Speaker Change: In regard to our potential liquidity events, and then I really want to get into the subsidiary, but in regard to our liquidity events.
Speaker Change: First of all our accounts receivable with the government.
Speaker Change: Due to the election.
Speaker Change: It was impossible for Mike for the team that we have higher we've hired some very sophisticated attorneys and political consultants to work on getting the accounts receivable from the government.
Speaker Change: Unfortunately during the electric for last couple of months all of a sudden the government. The politicians was sort of in shutdown mode in terms of being responsive all those doors are opening back up.
Speaker Change: I don't want to I don't think I should name names.
Speaker Change: But I will just say that our consultants have been meeting with very well known politicians and I am optimistic that we're going to collect a large block of money at some point the promise I just don't know when I don't know if its going to be a week a month three months or six months I can't operate the company I can't grow the.
Speaker Change: Based on money that's coming in in the future. So it's been really honestly frustrating for me, but I know, we have tremendous underlying value of the company and I know that we have large blocks of money coming to us down the road. So that's number one is the accounts receivable.
Speaker Change: I would also point out that on the accounts receivable, we have $70 million.
Speaker Change: Of testing for Covid that we did that we would never reimbursed for it.
Speaker Change: It's a ridiculous amount of money.
Speaker Change: You say, whereas the $70 million on your books, we were conservative and we never put the $70 million on our books, we put less than $30 million on our books. There is another $40 million that we're going after that is not even on our book, we never anticipated or expected to collect of $70 million. Some tests don't have the proper insurance et cetera, et cetera don't have the right patient.
Speaker Change: Information somebody tested to Washington, and they don't want to reimburse those types of things. So we discounted, but we're very conservative but.
Speaker Change: We realistically are going after the $70 million I would assume that we're going to get a percentage of that the group that we've hired is going to take a percentage of that when you put it all together I still believe that we have very large blocks of money coming to us I just don't know when it's hard to run a company based I don't know when.
Speaker Change: Two other potential liquidity events and this is really just developing now our be smarter stoppage youll cancer tests and I'll get into this when we go through the presentation.
Speaker Change: But we have.
Speaker Change: Initiatives that have started with some of the largest cancer diagnostic testing companies in the world.
Speaker Change: We can do a partnership at any time I don't know if thats in a month or two or six to 12 months I really don't know right now, but I can tell you.
Speaker Change: That our goal is to pick two of the largest against each other because they really want to get into the space and we have a lot of proprietary knowhow regarding the proteins that affect esophageal cancer I'm going to get into that more in the.
Speaker Change: General presentation, but I want you to be.
Speaker Change: Where southern Youll cancer, our test.
As enormous potential and the potential that we could get a block of money in sooner rather than later and we will just have to wait and see.
Speaker Change: And finally with PMI again, I'm going to get into the <unk> and.
Speaker Change: In moments, but I strongly believe we can sell that in the first quarter.
Speaker Change: And the valuations were talking about could be $40 million to $50 million and.
By the 12 to 18 months from now the valuation of it could be 100 150 million, so selling for $40 million to $50 million.
Speaker Change: Should be relatively easy it's not a guarantee but we know that there are a lot of very interested buyers.
Speaker Change: No.
Speaker Change: Let's get into the subsidiaries I wanted to start with that before we got into the actual slides I'm not going to spend a lot of time on each slide but I wanted to give you some of that background.
Speaker Change: Let's see if I can.
Speaker Change: Again.
Noelle this is not the usual scream, let's see okay. So I read through the forward looking statement already look I'm going to assume most of you are already shareholders already know the subsidiaries I'm going to talk about them and what our formalized manufacturing manufacturers lozenges are prophase be smart esophageal cancer tests.
That is multibillion dollars potential we just launched DNA complete and DNA expand nebula genomics think of that as our laboratory are world class Laboratory appropriate supplement we have lessons that sell in the marketplace. Now we have distribution of 40000 food drug and mass doors and we're soon to release <unk> broad based antiviral that I'm really excited about we have.
Speaker Change: The entire infrastructure in place to rollout <unk> I'm going to go through each of those and then we'll get into the Q&A.
Speaker Change: Right.
Speaker Change: When I say, our best is yet to come performance track record.
My track record speaks for itself of course with the stock price, where it is people say well what about now the one thing I can tell you, which I find interesting back in 2012, I had essentially a bankrupt company on my hands. The only product. We had was cold. These cold these had declining sales for four or five years. It looked like it was going out of business or stock price of 65.
Speaker Change: Interestingly, we probably had about the same number of shares as soon as we do right now today.
Speaker Change: I turned around the brand sold over $50 million pay down of $2 40.
Speaker Change: And cash special dividend to our long term shareholders.
Speaker Change: Okay. So now yes are we back to these pending stock prices yet the differences instead of having the cold These brand that I turned around and so we now have and at the time.
Speaker Change: Dozen years ago manufacturing facility wasn't worth it we now have a manufacturing facility that I hope to sell for $40 $50 million.
Speaker Change: We have a multibillion dollar potential esophageal cancer tests.
Speaker Change: We just.
Speaker Change: Released DNA expand in DNA complete.
Speaker Change: And I'm going to go into all the specifics of how great. They are that we've developed them separately, we have a world class genomics laboratory.
Speaker Change: We are about to rollout <unk> and in the next couple of months of broad based anti viral I'm going to go into why the potential of that is multiples of the potential of <unk> and we're back to the same kind of stock price I just want to put it in that kind of perspective I did it before I'm going to do it again.
Speaker Change: An enormous number of assets that might disposal to work on and develop compare to.
12 years ago, when the stock price was 65.
Speaker Change: And I'm really excited about the future of our company.
Speaker Change: Alright.
Speaker Change: <unk>. This is a no brainer to understand.
Speaker Change: The reason why I love this business.
Speaker Change: Is because it has.
Speaker Change: Strong demand growing demand.
<unk>.
Speaker Change: Demand for the next one to five years.
Speaker Change: The demand for lozenges is expected to grow into the next decade.
Speaker Change: As there is limited supply of capacity for manufacturing lozenges. It puts us in the right place at the right time I didn't plan that.
In fact, I, primarily kept formula in place because they wanted the manufacturing packaging shipping distribution and logistics for selling products into food drug and mass stores, we have access to 40000 food drug and mass stores that was the primary reason I kept this business not because I thought that one day that demand would be continuing to grow philosophy.
Speaker Change: And there would be a lack of capacity for manufacturing around the country and around the world now people ask me well, what's so special about our facility can someone else build one.
Speaker Change: We estimate in fact, we were negotiating with a large brand earlier in the year about this it would take about four to five years to build what we have and cost up to $70 million to build what we will have built in in the next year or so.
Speaker Change: Basically to build what we have right now maybe it would be about $50 million, where we're going with it would be about 70, but it would take four to five years to build it it requires.
Speaker Change: Acquiring the land and the building.
Speaker Change: Ordering the equipment takes a year and a half just to build the equipment that would be ship. It has to be installed you have to hire people to then run it with no customers and then you have to figure out how youre going to get an FDA approval that can be another two year. It's a major undertaking I don't see how theres going to be any serious competition for many years.
Speaker Change: There is another manufacturing facility or two one of them is focused more on gummies and capsules in other forms and don't care. In fact, we took some of their customers already but we are telling us we are a leading customer now. They are they are the top selling brand on Amazon and theyre, giving us as much business, we can handle.
Speaker Change: And.
Speaker Change: They are telling everyone. There's no license manufacturing facility in the country like ours.
Speaker Change: And that's what we're getting feedback from them. That's what we're doing and so we have more demand than we can satisfy right now and thats continuing so we're building capacity as fast as we can.
Speaker Change: The numbers are just.
Speaker Change: Taking off going forward, so we hired think equity too.
Speaker Change: To explore strategic alternatives, which tests the way of saying we are exploring a potential sale they have already.
Speaker Change: Targeted over 70 potential acquirers.
Speaker Change: We're already getting very positive feedback it's early.
Speaker Change: But they already did all their due diligence over the last couple of months put together the CIM, that's the confidential materials et cetera, et cetera et cetera.
Speaker Change: So to put this in perspective in terms of the numbers, we're looking at starting the fourth quarter this year approximately $15 million.
Speaker Change: Ill say its $15 million to $20 million I'm happy just to say $15 million and 5 million in earnings over the next 12 months, that's only on the first license manufacturing line.
Speaker Change: Our plans are to build out a second manufacturing line, which we ordered a year and a half ago. It's been built it's ready to be shipped we are currently in discussions with one of the largest licensed brands in the world. We're in very very late discussions with them basically all but done.
Speaker Change: They agreed to pricing et cetera, et cetera et cetera.
Speaker Change: They anticipate and we anticipate $20 million to $25 million a year in revenues from them online too and.
Speaker Change: They want to build in that ultimately it's going to go to $35 million. That's in addition to the $15 million on line one.
Speaker Change: So we're talking about a business growing to $40 million in revenues, we could enter a five year contract, which virtually guarantees the business growing at a $40 million revenue and then we're talking about a line three that we're planning for it.
Speaker Change: And we have customers already that would go to line three.
We were to build it up so.
Speaker Change: So it just goes from there so so the progression and the numbers are really exciting for PMI. It has enormous potential.
Speaker Change: So as much as our company and the stock price and everybody is upset right now including meet the factor matters, we have some tremendous opportunities going into next year and I would.
Speaker Change: Imagine that our company in terms of the balance sheet and the financials next year will look dramatically better than it does today.
Speaker Change: Okay.
Speaker Change: Be smart.
Speaker Change: <unk> biopharma be smarter esophageal cancer tests, just very briefly I know most of you know this but by the same token I think we have a lot of new shareholders are on this call. So bear with me I really want to make sure everybody is up to date.
Esophageal cancer is one of the deadliest cancers, 80% to 90% of people diagnosed with esophageal cancer will die of esophageal cancer why because they are diagnosed to like why are they diagnose delay because theres no. Good diagnostic test out there we have a great diagnostic tests that.
Speaker Change: That will diagnose you earlier more and more accurately and it will save your life.
Speaker Change: If youre developing esophageal cancer, which will save insurance companies billions of dollars and save lives and at the same time, the test and I am doing the quick version of this explanation. The test will tell you if you're a low risk if you're a low risk you don't have to get Endoscopies every year. So just explain how this will work when you have asset in your stock.
Speaker Change: I'll make that asset starts to eat away at the bottom, Microsoft because which is connected to your stomach overtime that develops pre cancerous cells.
Speaker Change: That's a condition known as viruses Avi people with Barrick was hobbyists or that are otherwise at high risk of esophageal cancer regularly get endoscopies, whether it's once a year twice a year or whatever right now in this country roughly 67 million people are getting endoscopies every year roughly $7 million of them are specifically at high risk of it.
Speaker Change: <unk> cancer.
Speaker Change: Insurance companies are reimbursing up to $4000 per endoscopy, that's a $28 billion expense to the insurance companies and that doesn't include the people who end up getting diagnosed with esophageal cancer 80, and 90% of them are going to die. So it's an enormous expense to the insurance companies and of course, there are a lot of people.
Speaker Change: Dine out there unnecessarily because they are not diagnosed early.
Speaker Change: Our test.
Speaker Change: Our scientists discovered this discovered the eight key proteins associated with esophageal cancer as those.
Protein shift more that indicates a higher risk of esophageal cancer and so our task and tell you whether you are at high risk or low risk. So if you are at high risk. There's a procedure you can get called then ablation and ablation destroys the pre cancer cells.
Speaker Change: Right now <unk> would love it.
Speaker Change: If they could send all their patients to get ablation sets are concerned about the problem is the insurance companies don't want to reimburse everybody getting into replace them because they don't know who really needs it and who does it would cost in absolute fortunate.
Speaker Change: And it's also unnecessary for everybody to get one, but if you knew which Pete which patients who are at high risk you could just give them.
Speaker Change: The ablation would save their life it would save the insurance companies billions of dollars and so we have a test that will tell you. If you are at high risk and low risk of your high risk <unk> blade and cellulite based on CPT codes and industry standards, We believe and it's based on the complexity of the tests based on complexity of our test. We believe we will be reimbursed 1000 to $2000.
And our target market is 7 million Endoscopies that are performed every year in this country and it doesn't include globally.
Speaker Change: I was working on developing some business in the middle East over the last couple of years the incidence of <unk>.
I'm, sorry, the incidence of esophageal cancer.
And <unk> is growing like wildfire over there and it all has to do with diet.
Speaker Change: Globally, it's a growing problem as well, but just in the United States market alone is 7 million endoscopies per year and with our test we're not telling anybody to go get endoscopy, a key component of the success or failure of a diagnostic test is this convenience theres nothing more convenience in our test.
Speaker Change: We're not telling the patient to do anything additional.
Speaker Change: This is only for patients who.
Speaker Change: So we're already getting the endoscopy.
Speaker Change: Patient after the Endoscopy goes home, there's nothing else basically I'll step the GI just has to send one of those specimen and endoscopy is where you stick a tube dangerous route and removed 7% to nine tissue specimens were a pathologist studies those tissue assessments under a microscope. The problem is to pass Allergist will study. The same specimen is the same microscope.
Speaker Change: I will tell you of esophageal cancer.
Speaker Change: So the next step the next morning.
Speaker Change: Step.
Speaker Change: If medicine wants to evolve and really take care of patients it would be to send that specimen to our lab run it through a mass spec machine and we will tell you definitively whether you have esophageal cancer right now and or whether you are at high risk or low risk and based on the high risk low risk. If you are low risk you don't have to get an endoscopy or Rio that will save the insurance companies.
Speaker Change: The dollar and the patient doesn't have to get an unnecessary endoscopy, which honestly isn't five.
On the other hand, you are at high risk of failure life. So it's really an incredible test.
Speaker Change: We're looking to commercialize it.
Speaker Change: <unk> approximately a year to be clear I don't want to complicate matters. It could either go in L. D T Rowe route.
Speaker Change: A laboratory developed test or FDA FDA earlier this year was talking about getting involved in monitoring all ltte's.
Speaker Change: <unk>.
Speaker Change: At our consultants, but there's no way, that's going to happen, but FDA sounded pretty adamant that it was coming to that now I'm hearing that within the next month or two FDA is going to say that they've changed your mind on that initiative. If we go the LDP route we can commercialize very quickly, but the fact of the matter is.
Speaker Change: We've hired.
Speaker Change: Foreign healthcare consultants, a multibillion dollar who as use them in the past it made a lot of money with them on other cancer diagnostic tests and alike highly recommended them to us and one of the best recommendations I've ever received foreign healthcare consultants are experts in the industry.
Speaker Change: <unk>.
Speaker Change: They have developed many as consultants many very successful multibillion dollar diagnostic testing companies and protect Keller Garden health the founder of FHA work with Garden health for five or six years very closely garden health right now is about a $2 $7 billion Mark cap. So we're working very closely with FHA.
Z wants us to take a very conservative approach so that when we launched we have the physician networks behind us we have the insurance payers behind us.
Speaker Change: We have the key opinion leaders behind US we have all the right.
Speaker Change: Papers published in all the right publications et cetera, et cetera, they want to do it the right way. So even if we go the LDC route realistically, we'll probably commercialized late next year. If we have to go through FDA realistically, we'll probably get FDA approval at the end of next year, we commercialized the beginning of 2026.
Speaker Change: But again, just going back to the numbers for a moment.
Speaker Change: We're talking about $7 million Endoscopies and getting reimbursed 1000, 2000, and that's a 7% to $14 billion market, we're going after with virtually no competition.
Speaker Change: And even if we only get a fraction of that and we thank every one of these endoscopies should use our debt, but even if we only got a fraction of that the numbers are ridiculously large compared to our current market cap and it's not far away. This isn't like a drug where you have to go through FDA and you have to spend another 50 or $100 million.
Speaker Change: Another five or 10 year to maybe finish the phase II finished the phase III and then keep your fingers crossed that you get great results and the FDA approval, we've already gotten all of our great results.
Speaker Change: In fact, we're doing more studies, but we don't need them to commercialize we're just going to make the statistics stronger and stronger and more compelling, but we're ready to go on that so I'm really excited about it. So my point being from the point of view of a biotech. This is very late stage in its development and yet it has zero value in our company.
Speaker Change: And the stock market right now just something to be aware because its very real for those of you that know me you know that I am a straight shooter that I've executed in the past and I am a huge believer in this test.
Speaker Change: I think it's going to save a ton of lives.
Speaker Change: Can save insurance companies billions of dollars and there is no reason why we can't make billions of dollars in the process of whether it's hundreds of millions or billions either way. It makes our stock of 10, 2030, 40, 50 times from where it is right now.
Speaker Change: Finally, just very quickly before I move on.
Speaker Change: I'm spending a lot of time on this because look our formalized manufacturing to me is the lay up it's worth an enormous amount of money.
Speaker Change: Now probably double the entire market cap of our company. If we held it an extra year it could be worth triple or quadruple our at the market cap of our company.
Speaker Change: With esophageal cancer can be worth 10, or 20 times, the Mark cavalry of our company really is that kind of potential.
Speaker Change: And my point being is it formalizes worth that much now based on its revenues and earnings.
Speaker Change: <unk> dramatic and significant underlying support.
Speaker Change: For our company, while Youre getting these other.
Speaker Change: Biotech related assets and initiatives basically for free even less.
Speaker Change: Lesson for free so one last thing I want to mention for those of you doing due diligence.
Speaker Change: Youll hear about blood tests for esophageal cancer blood tests I don't care, what they tell you. There is no such thing as a highly accurate blood test.
Speaker Change: Don't want to pick on other companies.
Speaker Change: But a lot of times with these clinical studies the results aren't always exactly the way they present them.
Speaker Change: As an example.
Speaker Change: With Covid testing.
Speaker Change: When the antigen test came out everybody said, they're just as accurate they were nowhere near as accurate. It was a joke, but it was a good first test because it can be done on the spot and so with the antigen tasty you get the antigen test you test positive then you follow up with PCR tests, which gives you. The more accurate result will think of it the same way with a blood test you got a blood test.
Speaker Change: <unk>.
Speaker Change: The test positive what's the next step.
Speaker Change: Go to your Gi get an endoscopy, that's where we come in and actually grows our market. Our market is after you get the endoscopy. The blood test is before you get into us. So if you get in if you do get a positive blood test.
Speaker Change: If these companies with blood tests are successful.
Speaker Change: I hope they are it's actually going to grow the market for more endoscopies, which is going to grow our market that competition. So the blood test.
Speaker Change: I'll give you a positive or negative that gives you a positive. The next day, if youre going to go to the GI. The judge is going to want to immediately give you an endoscopy and once you get the endoscopy.
Speaker Change: This person to our lab and we will give you. The definitive result, okay. There you go I think.
Speaker Change: I think we really covered it.
Happy to answer more questions on a DNA complete so we just once DNA complete.
Speaker Change: I'm not going to spend too much time on it DNA complete.
Speaker Change: As a significantly more.
Speaker Change: Research reports.
Speaker Change: Then what we had with <unk>, but more importantly, it has an advanced ancestry platform, we formed DNA complete to work with new developers and develop this incredible ancestry product.
Speaker Change: And.
Speaker Change: We have all these great offerings now for DNA complete and just as importantly, and I've mentioned this.
Speaker Change: We are working with the former COO of Barstool sports who is in charge of.
Speaker Change: Business in marketing is an experts expert he has connections to everybody to influencers et cetera et cetera. He has been working on this the better part of the year with Jason Carcass on building this incredible.
Speaker Change: Media and marketing platform that we're now going to be rolling out and the other thing that's special DNA expand.
Speaker Change: I'm really excited about this DNA expand does not require a lab test.
Speaker Change: We take an accessory test data so if you're a consumer 26 million consumers have gotten and accessory tests.
Speaker Change: All $26 million, if you've got your anti through tests from 'twenty three may accessory dot Com My heritage Youre allowed to download your data you can then uploaded to us.
Speaker Change: The only cost to us as we then have to store the data and some other IC all in all my cost was $5 $6.
Speaker Change: Meanwhile.
Speaker Change: The accessory companies 23 minutes towards the $69 per year for subscription to provide you with health related <unk>.
Speaker Change: Research reports.
Speaker Change: Related to your ancestry test will provide significantly more.
Speaker Change: Health related reports, we boost your data is significantly I'm not going to get into the science behind it but you can re read here expanded your DNA data users file has boosted 50 times more data after upload we provide significantly more in depth health and wellness reports compared to typical DNA accessory tests. So we're providing an enormous wealth of.
Speaker Change: Final information, we'll do it for $49 subscription instead of 69 will save the consumer $20 and provide them more information request was like four or $5.
Speaker Change: This is a cash cow throw out everything in the company just focus on this one business.
Speaker Change: I don't know.
Speaker Change: Three years can we get $1 million out of $26 million.
Speaker Change: Not a lot, but if we got 1 million that would be a $50 million a year revenue business generating $40 million.
Speaker Change: More than $40 million in profit minus whatever the cost of the advertisers. This this could be earning 10 20 $30 million a year.
Speaker Change: So I'm really looking forward to ramping up this business. Another reason why we wanted to do capital raise I want to start advertising is now I'm going to start going after these consumers now.
Speaker Change: First time of the year to go after them as holidays.
Speaker Change: Yes.
Speaker Change: It's black Fridays, it's Christmas everyone's, giving gifts so I'm really excited about these products and this lunch.
Speaker Change: And again nebula genomics I'm not going to spend a lot of time on I think of that moving forward more as our laboratory. We also work very closely with George Church World renowned in the field of genomics up at Harvard we've been working with him.
Speaker Change: For years on.
Speaker Change: These companies and it's a real pleasure having him on our advisory board and we speak with them regularly alright, prophage supplements very quickly as I mentioned, we have a brand legends XL when we sold the Colby's brand I wanted to keep the infrastructure in place.
Speaker Change: To reach out to the 40000 food drug and mass retail stores. So we had the manufacturing packaging shipping distributional logistics.
Speaker Change: We have our same senior salesman, Joe Brennan who's been with us.
Speaker Change: Even more years and when I took over control of the company I remember Joe brand with the company. When I was first just an investor. So he has probably been in the company about 20 years.
Speaker Change: He is an experts expert on selling into the retail stores I worked very closely with them on colby's in turning around and then he placed legends XL into Cvs and Walgreens.
Speaker Change: We don't even do any advertising this product is doing a $3 million a year. We're now on the media platform marketing and media platform that we built that we're launching DNA completing DNA expand width, we're also going to build out.
Speaker Change: Our whole prophage supplements.
Section, which could be really cool lessons X ella's just the lead on that we also have triple edge, which is complementary to legend textiles, you can bundle them together as a great workout product, but more importantly that was more to keep the infrastructure in place. We have the same great relationship with the number one sales broker in the country that works with all the.
Speaker Change: A major retailers and with those relationships, we're now going to rollout equity here.
Speaker Change: So <unk> is a.
Speaker Change: I'm not sure what I'm allowed to say on the packaging and when I'm not so pleased I'm not advertising a product that's not out yet.
Speaker Change: So I have to be very careful how we talk about it but I can tell you that we did a very large now first of all a lot of studies were done before we acquired the rights to the product a few years ago, but since that time, we ourselves independently did a very large clinical study now typically what the FDA would like to see.
Speaker Change: Is two studies of at least 50 55 patients.
Speaker Change: If you want to keep the class action attorneys walk you back you also want to at least two studies a 50 patient fee I know this from experience.
Speaker Change: No idea, how many nuisance class action lawsuit side to deal with what's called these we won all of them, but they were a nuisance and I'd rather avoid them and so I made sure that before we could have launched equity already I didn't want to launch it until this clinical study was done. So we did two warm a total of 370.
And the preliminary result were phenomenal and the final result, we recently got in the raw data and the initial word back on the raw data is that the.
Speaker Change: <unk>.
Speaker Change: Clinical study researcher is really excited about the final results and I can't wait for that all to be written up and that should be done before year end, we launched <unk>.
Speaker Change: I've been talking to my team recently, they think that <unk> could be the biggest product of all.
Speaker Change: Now of course, that's separate from PMI, which has a manufacturing facility in our beef smartest epigeal cancer tests. Those are two completely different business, but from a product point of view equity or it could be the biggest thing that we sell and the reason it's different from Colby and by the way I still take hold these I still believe in it.
Speaker Change: Because these are the homeopathic license it dissolves in your mouth. It sits there for a long time, some people don't like to taste of it and it's homeopathic only about 6% of the country or even by homeopathic products. So it's a small market I had the turnaround in growing brands with a very small target market and dip.
Speaker Change: And just to show you that.
Speaker Change: <unk> my own horn.
Speaker Change: I saw that brand for $50 million I had of doing a fair amount of very fair amount of revenues is growing and profitable.
Speaker Change: That business is now doing a small fraction of what it did when I turned around Matt I don't want to go into more details we do.
Speaker Change: Still manufacture Colby I still believe in and they still taken myself <unk>, though is not homeopathic. It is not a lot of those.
Speaker Change: So the market the target market is probably five times the size of the market that cold. These would sell to the number of consumers. We can sell through it's probably five times as many.
Speaker Change: The results have been phenomenal I don't won't go into more details now except to tell you that we tested during the cough cold season.
Speaker Change: Two arms, one was as a therapeutic meaning if you've got sick you either <unk> or you took a placebo it turned out theres just preliminary results. The preliminary results showed that if you took out <unk> as many days and that included for cough cold flu and Covid, we will not be able to make COVID-19 claims, but we will be able to publish.
Speaker Change: Studying the results will speak for itself.
Speaker Change: That is a therapeutic than as a prophylactic, meaning you take it every day turned out the group that took everywhere.
Speaker Change: Got less sick or less incidences of getting sick of everything from as I said cough cold flu COVID-19 compared to those taking the placebo. So the results I'm really excited about the results can't wait to rollout this product.
Speaker Change: Okay, and I, just talked about the <unk> clinical trial and the timeline I already covered all of that the.
Speaker Change: Investment highlights Youll get it I just want to wrap up with.
Speaker Change: And I have really gone through all of this but I think it's important, especially given the stock price some people like Oh, what's going on.
Speaker Change: I have never been more bullish on.
Speaker Change: On the future of our company that I am right now with the assets that we are developing we have never had the wealth of assets that we have now and we've never had the potential that we have now and it's not like these are pie in the sky assets that maybe get commercialized in three five years and required tens of millions of dollars.
So if you can't tell I'm enthusiastic about what we have I think our future is very bright and I am going to focus on making sure.
Speaker Change: That financially going forward we.
We took a lot of expense I don't even want to say where.
Speaker Change: I have to be very sensitive about what I talk about now, but I can tell you that our financials.
Speaker Change: I have the ability to make our financials improved very significantly very soon and that's my goal and that's what I'm going to do for you as a shareholder and Thats, what im going to do for me is the largest shareholder in the company.
Speaker Change: So I. Thank you for your time and your patience.
Speaker Change: Usually my presentation about 25 to 30 minutes. This is now a little over 40%.
Speaker Change: Less.
Speaker Change: And while I know there is im sure Theres, a bunch of questions out there, let's try and I'll try and keep this to an hour, let's get through as many questions. As we can know Alan over to you for the questions. Please.
Ted Peck: Thank you Ted Peck completion, we will now begin the Q&A.
Speaker Change: First question is.
Speaker Change: How is DNA complete different nevertheless is there a pathway for nebula customers just question DNA complete.
Speaker Change: Sure so.
Speaker Change: The key difference think of look we decided to develop DNA complete and DNA expand.
Speaker Change: Think of it as a.
Speaker Change: Well first of all we have the enhanced ancestry, which nebula never had we have more health reports with DNA complete.
Speaker Change: And with DNA expand.
Speaker Change: We have this incredible opportunity of this amazing.
Potential cash flow generating business with incredibly high margins, where we're going after the ancestry customers. So it's really an entire it's an entirely new business, we form DNA complete and expand completely separate from Nabila. So nebula think of that as we are still going to use the nebula lab going for.
Speaker Change: But we can also use other labs, if we want to so we have a lot of flexibility now with DNA completed D&A expense. It also gives me a lot of flexibility with what we do with nebula in the laboratory.
Speaker Change: So it's I really have the best of both worlds and I have a lot of flexibility now these are completely independent companies have each other they are both wholly owned subsidiaries appropriate labs.
Speaker Change: Thank you for your response has the next question is can we expect initial sales sales figures for DNA complete in Q4.
So we.
Speaker Change: Yeah, well look we're going to report Q4, whenever we report Q4 I would imagine we will certainly break out DNA complete DNA expand sales.
Speaker Change: I'm not I'm not the CFO, but I believe we'll probably break them out, but having said that we're just launching this now mid November.
Speaker Change: So it's going to take some time to get some traction. So we should get some traction over the next six weeks, alright, and especially because of the holiday season, which again is another reason why I wanted to get some money in the door. So that we can be aggressive with the advertising and immediately put a block of money into the advertising.
Speaker Change: So that our social media and marketing team could ramp up immediately with that so we're we're still tweaking the website and the logistics of it at the same time, we're ramping up.
Speaker Change: Thank you.
Speaker Change: The next question for you is what was the cost for a launch marketing for Danny complete.
Speaker Change: What was the cost okay. So you've got to understand this has been a work in progress for quite some time as I said, we collaborated with Stu hollinshead.
Speaker Change: Back when he left.
Speaker Change: Our stool sports he is now the CEO of <unk>.
Speaker Change: Have a marketing company that has very nice potential and at the same time. He is a consultant to us it's a great relationship and so we've been working with him and building all year. It's more adjacent to me. The two of them work very closely together every day and so we get the best of both worlds, we get to leverage all of that expertise and all the infrastructure.
Speaker Change: Sure.
Speaker Change: Stewart's company, which is 10 pm curfew.
Speaker Change: And.
Speaker Change: It's just a great situation for us. So this has been building all year. So in terms of the expense we have been.
Speaker Change: Spending on this all year in terms of the expense now.
What you do is you spend money on marketing and then Youll see the results and based on the results you have to tweak it they've already been doing quietly doing some testing long before now, but now they really start to ramp up and based on testing and seeing.
Speaker Change: Where are you getting a positive return on your advertising dollars and where youre getting a negative churn, obviously optimized to where youre getting a positive return and then you advertise more and more and then as Youre generating revenues and cash flow you keep growing the advertise its exactly what I difficulties.
Speaker Change: Many years ago, but when I did I, mostly did it with TV Soc.
Speaker Change: Social media and online in podcast I don't think Thats something I think to me that's more of a young person.
Speaker Change: I'm being honest.
Speaker Change: We're probably going to do TV radio and when we do I will be heavily involved in that I also have some very strong beliefs on how to advertise its critically important that you generally that you create an effective message in the way you do that with a lot with a lot of test marketing.
Speaker Change: And then once you create a highly effective message you have to deliver that message efficiently.
Speaker Change: If you are spending a lot of money on the advertising to get the word out it's not going to be a fishing youre going to have a low ROI. So it's important to have an effective message and then deliver that message as efficiently as possible I used to buy remnant time on TV and radio Walter I was paying less than anybody Zicam was a big competitor of ours, we gained significant market share on them when I was building.
Speaker Change: These brands, even though I have one fifth the budgets that they did so we're basically going to do the same kind of things with same sophistication and rolling out DNA completing a DNA extent and then I'm really excited when we rollout Ecuador, I think everybody is going to be no brainer at the same time that we're selling that online. We're then going to ultimately work it into the 40000 food drug and mass retail stores Thats the goal.
Speaker Change: Thank you for elaborating on that.
Speaker Change: Question for you is.
Speaker Change: Any prospect to screen for more than just the stoppage or cancer for the PCR test.
Speaker Change: So look there are a lot of directions that we could go in.
Speaker Change: But my goal right now.
Speaker Change: Is to limit.
Speaker Change: Capital expenditures going forward.
Speaker Change: As I said in the press release My first goal is to cut out about $6 million of overhead and expenses going forward.
Speaker Change: My goal is to do that before year end as a run rate going into next year, that's point number one.
Speaker Change: So point number two.
Speaker Change: Last thing I want to do.
Speaker Change: Develop newest initiatives its going to cost us millions of dollars.
Speaker Change: Don't believe in it.
Speaker Change: <unk> 23, and me is struggling right now theyre not struggling because of selling their ancestry tests. If they just stayed the selling ancestry testing.
Speaker Change: They probably would've made a fortune they'd be a great company with a big market cap they got into drug development.
Speaker Change: That's what got them into trouble.
Speaker Change: The last thing I wanted to follow.
Speaker Change: And the mistakes of these other companies and by the way with 20 <unk> struggling that's a real opportunity for us because we can go after their customers with our DNA expand product. So this is a real opportunity for us. So the bottom line is I don't want to develop.
Sure.
Speaker Change: Very expensive drugs.
Speaker Change: We do have one actually cancer therapeutic called linebacker where we've got great preliminary results, but I will not spend a lot of money on that our goal really is to partner that I don't want to shoulder the expense by the same token with our Softgel cancer test.
Speaker Change: I don't want to shoulder the expense of going another direction other than there may be other delivery technologies for using our test that don't necessarily require a dust to be like a Brexit goes down your throat, that's still picks up the tissue specimens and we can run the test without an excellent so there.
Speaker Change: There are ways that we're looking into but the key is we have the IP on the <unk> proteins and if anybody really wants an accurate <unk>.
Speaker Change: Average yield cancer tests.
Speaker Change: And just so you understand I didn't really explain us what the blood test earlier.
Speaker Change: I think youll cancerous growths in your esophageal tissue it doesn't grow in the blood.
Speaker Change: It takes time for the disease.
Speaker Change: To go into the blood and by the time it seats into Budd Youre. So much blood in your body. It gets diluted so a lot has to go into your blood before blood test is going to pick it up.
Speaker Change: So the key though is that tissue is getting to the tissue. So there may be.
Speaker Change: Other ways of testing for esophageal cancer, but.
Speaker Change: I believe it really needs our test because they are cuts as one with the IP on the eight key proteins associated with esophageal cancer I don't see how it will be very difficult to develop an esophageal cancer tests, that's as accurate as ours that doesn't.
Study the proteins that we have the IP on and then at the same time as I said the blood.
Speaker Change: No way, it's as accurate because too many false negatives to make false positive, but it could be.
Speaker Change: Our first.
Test that you take before you get the endoscopy from the Gi.
Speaker Change: Thanks Helane.
Speaker Change: The next question for you is.
Speaker Change: Who are the shares and the financing sold to how much stock did think equity get and how much were they paid to handle the financing.
Speaker Change: So look it's a standard investment banking deal.
Speaker Change: The investors were institutional investors. These are clients of think equity I met with a lot of them.
Speaker Change: So a part of what happened here.
Speaker Change: Accuse me.
Was that I went to think equity conference. So there are actually a couple of delays in this race.
Speaker Change: Part of why the timing got a little screwed up.
Speaker Change: But I went to I think equity conference about a week and a half before I met with a ton of institutional investors had great meetings with them. Then we had an election and then we did the raise.
Speaker Change: So the bottom line is I don't have a lift yet I'll, probably get a list I don't have a lift yet of who the investors are but they are typical institutional investors that our clients are incorrectly.
Speaker Change: Thank you for clarifying that Ted.
The next question is what is the basis for.
Speaker Change: What is the basis of your forecasting 15 million and pre tax profit of five how do you arrive at that number.
Speaker Change: Sure so.
It's actually pretty straight forward.
Speaker Change: We have more customers than we can handle we've been increasing prices on them.
Speaker Change: We have a new customer who as I mentioned.
Speaker Change: Tell us that they are the largest seller of lozenges.
Speaker Change: On Amazon.
Speaker Change: And they're giving us as much business, we can get and it's high margin business. So we're really we're just looking at our capacity.
Of our first line and by the way, we added automation equipment to increase our capacity, we're also adding shifts so.
Speaker Change: Those are really just number of calculations as to how many shifts how much product is manufactured per shift.
Speaker Change: Et cetera, and then what are we charging for it and then what's the cost of ingredients. So you put that altogether.
Speaker Change: And you come up with numbers, but I understand.
Speaker Change: This isn't like we're guessing if more customers come to us.
Speaker Change: These are customers that we already have as I said, we have one large customer that will take all the capacity, we can give them right now and we're accepting orders right now through April.
Speaker Change: Of next year. So we already know our entire book of business and what we charge our customers through April of next year, So and the other thing I would mention is typically in the lodging business.
Speaker Change: It's seasonal.
Speaker Change: So consumers are buying the product in the cough cold season, let's say fourth quarter first quarter. So the retailers want to stock the shelves with it starting just before the fourth quarter.
So in the third quarter. So a lot of the manufacturing really takes place third and fourth quarters. So second quarter is typically a down a very down quarter seasonally, but we're now adding new non seasonal customers. It turns out there are companies in the diet and the.
Speaker Change: Dietary supplements space, who are selling capsules.
Speaker Change: And gummies and other forms but don't have a lot of it's more of that now want to get it allows us to lozenges are becoming a more and more popular form not that there are overtaking. These other forms. So for example, I didn't really mention this one of the reasons I'm. So bullish on equity here, it's not just that our target market is so much bigger.
Speaker Change: We're not <unk> its not a homeopathic products, but also we're castle.
Everybody takes capitals capsules, so really easy to take some people love logins and some people hate them every nobody on almost no. One else has a problem with the capsule, you're just well, it's really easy to do so.
Speaker Change: One of the most popular forms so.
Speaker Change: So the bottom line is we have all of these orders and we have the capacity and we know what were charging so it just becomes a numbers game. It's not like we have to guess or are we going to have order. So and then the beauty of our second manufacturing line, we're negotiating with the branded take up the entire capacity.
Speaker Change: And in fact, they are talking about they want in years and Theyre talking about a five year contract theyre talking about by year three.
Speaker Change: They expect us to have a third line and they want to pick up some of that too we're talking about growing the $30 million to $35 million year revenues.
And that's in addition to what we're doing on the firstly, so and understand the reason why we can do more in the second line. It's twofold, one it's much more new equipment and it requires less labor. So it's much more efficient capacity is significantly greater and our margins are greater in the second one on the other hand, if we do all the business with one large brand.
Speaker Change: They're going to want us to charge them less.
Speaker Change: If we had 15 customers. It's also a lot easier for us if we're not constantly switching customers every time, you switch a customer you need downtime to clean the equipment and machinery.
Speaker Change: While the labor has to know how and learn how to manufacture the intricacies of each different products et cetera, et cetera et cetera. So the second line is much more efficient we charge less so our margins might be less the volume is greater the margins left but it's a really nice profitable business as well. So these numbers and Thats why my point.
Speaker Change: Is private equity loves the business like this because you can see visibly what the growth could look like if they are willing to invest especially in the third line you can see what the business looks like for the next 2345 year, it's exactly what they want so what they do is they say to themselves. Okay. We buy for $50 million, we're going to finance it what's the <unk>.
Speaker Change: <unk> cost of the financing how much capex do we have to spend.
Speaker Change: And what's the business worth in three years to five years.
Speaker Change: And guess what the return on it could be enormous. So the next question people are asking me well there myself.
Speaker Change: They may not sell it all depends on the finances of the company I don't want to be strapped for cash I don't want people upset because I do capital raise I don't want to do capital raises.
Speaker Change: I want a liquidity event now the easiest liquidity events. It is the most reliable is the sale of PMI and that honestly is what I'm focused on because once I fell that.
Speaker Change: I don't know if I'm, if I'm allowed to say this or not I'll have to say this but I'll just tell you if we sell PMI and our stock is anywhere near these price buy back every single share that was issued last week and more and I've done it before.
Speaker Change: I bought back an enormous amount of stock over the years I can't wait for next year, we have a liquidity event.
Speaker Change: I don't want to.
Speaker Change: I don't think I'm allowed to say I'm definitively going to do it and I don't want people to buy the stock today, because I'm going to do it but I want to explain to you how I think as a CEO and as the largest shareholder by background as a wall Street and investment banking.
Speaker Change: Miss you I know, what I'm doing and I promise you if the stock is anywhere near these prices prices when we have a liquidity event.
Speaker Change: Forget about alright, I will buy up every share that any money in fact, when I sold the called these Bren I did a Dutch auction of the Dutch auction is where you say to everybody publicly up buyback your stock.
Speaker Change: I did the DUC selection and there was one shareholder that a 14 nine 9% of the shares outstanding.
Speaker Change: <unk>.
Speaker Change: I didn't get along with them.
Speaker Change: And so.
Speaker Change: When we're done with the Dutch auction was slightly oversubscribed I didn't take a manageable although stock. So it did second Dutch auction alright.
Speaker Change: Alright. So my point is that is my history, I cant guarantee what I'm going to do in the future and I'm sure. The SEC doesn't want me talking about how I might do a stock buyback in the future, but what I can tell you is look at my history of what I've done in the past there is no reason why it wouldn't repeat that.
Speaker Change: And Theres No reason why the same thing that happened over the last decade isn't going to happen again, the differences instead of having one small asset that I turned around and sold for $50 million I have four or five assets.
And then I can build and several of them I believe I can sell through a hell of a lot more than that.
Ted: OEM it's Ted.
Speaker Change: I think we're out of time.
Speaker Change: I'm sure a question are we good.
Speaker Change: Excellent.
Speaker Change: Time for one more question.
Speaker Change: Go ahead go.
Speaker Change: Go ahead.
Want to squeeze in one more I don't want to leave anybody hanging I'm sure you've got a lot more but we're at a time, but let's do one more because we started a little after the hour. So we're giving it a full hour go ahead, what's your last question.
Speaker Change: The last question is from Hunter Diamond from Diamond equity.
Speaker Change: <unk> for the beef esophageal cancer test could you provide more detail on the nature and scope of the partnerships with two major cancer diagnostic companies.
Speaker Change: Elster when should investors anticipate in terms of validation market access.
Insurance reimbursement timelines.
Speaker Change: Great question, and I apologize I got to give a shout out to 100 Diamond These and analysts that actually follows our company does a great job bright enough research report it wouldn't surprise me. After this that whole write up a research report I don't know, if you will or won't but it wouldn't surprise me.
Speaker Change: Anyway Diamond equity research Hunter Diamond. Thank you for your question.
Speaker Change: Well I didn't really even talk about that.
Speaker Change: On this call today.
Speaker Change: Except very very briefly and this could be a very big deal and it's just it's kind of premature and I don't like to mislead anybody in Idaho.
Speaker Change: Formalized.
Speaker Change: It's a done deal there were putting it up for sale and that we're aggressively along so not that were guaranteed to sell it but I can tell you definitively it's up for sale and so it's appropriate for me to say it's up for sale. These are the numbers and these are my expectation with the beef smartest hypogeal cancer tests, we go in one or two directions, we either commercialize it ourselves.
Speaker Change: <unk>.
Partner and after we commercialized or we partner net now for my way of thinking.
Speaker Change: We're far along in the development stage of this is is when large multibillion dollar companies want to partner just before commercialization.
Speaker Change: The reason I like the idea of partnering.
Is because these large companies already have this massive infrastructure in place. They have a sales force they are already going into the Gi offices. The physicians networks. They have the relationships with the insurance payers.
Speaker Change: With the key opinion leaders et cetera, et cetera, et cetera, very easy for them to commercialize our test.
Speaker Change: At the same time I know.
Speaker Change: That there are multiple.
Speaker Change: Colon cancer diagnostic testing companies that are dying to get into the esophageal cancer space. It is a perfect fit you all know.
Speaker Change: With a colonoscopy how that's performed.
While that goes up one way and the endoscopy. They go down your throat going down the other way they wanted to get your comment <unk> not my job, but seriously. These companies what an esophageal cancer test and we got the proprietary IP that they need.
Speaker Change: So.
Speaker Change: The question is if our market as a potential $7 billion to $14 billion market.
One of these large companies could potentially.
Three years from now they could build our tests, we commercialized it in roughly a year two years out it could be doing easily hundreds of millions of dollars in revenues on its way to $1 billion in revenues.
Speaker Change: Just imagine I don't know what our royalty would be.
Speaker Change: Vertically, there's some industry standards in there like a 25% or $50 million upfront or milestone when you actually commercialized and then.
Speaker Change: It could be a 7% royalty seven.
Speaker Change: 7% royalty.
Speaker Change: The $1 billion $70 million here I'm, not going to say that we're going to get $70 million a year for esophageal cancer tests and royalties by the same token.
Speaker Change: If instead of a $1 billion tests, it's only a $100. We can do $100 million test by ourselves by the way I don't think we need a large company I think we will get to $100 million.
A year by herself, but let's suppose we partnered at when they first get to $100 million in revenues you know, it's going to grow to 200 500, but even at a 100 million to $7 million a year of free earnings cash flow for a company that alone would make our company was five times its current value of 10 times or whatever it is so the IV.
Speaker Change: Partnering it just speeds up and accelerates.
The valuation of the test and at the same time gives us more upside because the risk reward partnering with a large company.
Probably significantly reduces the risk and still gives you a lot of upside maybe not as much as on our own but I think that if we partner they'll make it a much bigger test them, we will by ourselves and then the truth matters that we did it by yourselves ultimately in a couple of years, we probably sell it anyway. So.
Speaker Change: Hunter Diamond, specifically ask though who we're talking to.
Speaker Change:
Speaker Change: I will just tell you there they are a multibillion dollars cancer diagnostic testing companies.
Speaker Change: And.
Speaker Change: <unk>.
It's somewhat preliminary but my guess is preliminary could accelerate very very quickly there could be a competition for it again I don't want to jump the gun and I don't want to say that we're going to do this I am very confident.
Speaker Change: And selling PMI because the revenues numbers are there right now and I know that Theres, a long list of potential buyers with our esophageal cancer test.
Speaker Change: Let's see how the next months goes with discussions.
Speaker Change: Hopefully I have something really positive to say about it.
And we will see over the course of the next 246 weeks.
Speaker Change: Anecdotally I will tell you that.
Speaker Change: Our consultants at FHA sent me some cryptic note.
Speaker Change: Yesterday.
Speaker Change: Uh huh.
Speaker Change: And I said, what do you mean, what do you mean and it just kind of repeated with a smile.
Speaker Change: I know he is making progress and I'll see what that means so we have real the bottomline is we have real potential there and I'm excited about it.
Speaker Change: Thank you for all the questions I'm, sorry, we ran out of time on the questions.
Speaker Change: Noelle Youre supposed to ask me for closing remarks, Im sorry, Im doing your job right now.
Speaker Change: Thanks, Todd well that concludes our Q&A session for today, but before we go I would hand back to <unk> type of Panamax. Okay. So again, thank you everybody for joining today as you can tell.
Speaker Change: I am really optimistic for the future the assets, we have under development speak for themselves. They are late stage the difference with US. Another biotech is first of all our manufacturing facilities not biotech theres no risk associated with it just say, it's a growing business our other businesses.
Speaker Change: <unk> and legends XL, they're not really they are biotech their supplement we have a great platform distribution in place for them. So I'm excited about them equity bear by itself could be a phenomenal product.
Speaker Change: Prophase supplements, our prophage subs.
Speaker Change: That business could be a tremendous business that we grow for the next few years.
Speaker Change: So we have a lot going for us. It's all late stage, it's all commercialization now or soon at the same time my goal is to significantly reduce overhead and expenses going forward. So that we are.
Fiscally conservative going forward understand a part of this is because we should have gotten a block a large block of money from the government a lot of my planning it wasn't a sloppy, but a lot of the planning was based on the fact that the government should have paid us significantly more money than it has long ago and thats disappointing so now.
Speaker Change: I have to I have to respond accordingly, as a responsible CEO I have to figure out how to adjust to that fact that that money will come in when it does how much comes in but I'm not going to count on it I'm not going to wait for it I want to run the company and if that money isn't coming in I am still very confident it's going to but I have to run the company Accordingly, and there is some things we can.
Can do where I want to focus on our core assets that are either commercialized or about to be commercialized and again, our salvage youll cancer tests, I don't think thats going to cost a lot and if we end up partnering that's not going to cost us anything commercializing to the contrary, we're going to get money upfront. So I'm thinking in terms of being very cost conscious going forward.
Speaker Change: Third and building our company in a smart way and with that again. Thank you. All we ran way overtime everybody have a great day I really appreciate your support and looking forward look next month I will do another call like this and I should have lots of update so check in with rent Mark you can sign up it's free and they will let you know where every.
We have another presentation coming up thank you again have a great day.
Speaker Change: Thank you Ted and thank you to everyone for joining us today.
Speaker Change: Third quarter 2024 hour results.
Speaker Change: <unk> is trading on the NASDAQ under the ticker symbol PRP.
Speaker Change: The payback for this.
Speaker Change: So the payback of the show will be available on our web site 24 to 48 hours. After this presentation under the Daniela <unk>. Please.
Speaker Change: Please see the presentation. Thank you next time.