Cerus Corporation (CERS) Q1 2019 Earnings Report, Transcript and Summary

Good day ladies and gentlemen, and welcome to the Cerus Corporation First Quarter 2019 Earnings Conference Call. At this time all participants are in listen-only mode. Later, we will conduct the question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder, this conference call may be recorded. I would now like to introduce your host for today's conference, Mr. Tim Lee, Investor Relations Director. Sir, you may begin.

Thank you operator, and good afternoon everyone. I'd like to thank everyone for joining us today. With me on the call are Obi Greenman, Cerus' President and Chief Executive Officer; Dr. Richard Benjamin, our Chief Medical Officer; Kevin Green, Cerus' Chief Financial Officer; Vivek Jayaraman, our Chief Commercial Officer; and Carol Moore, our Senior Vice President of Regulatory Affairs and Quality. Cerus issued a press release today announcing our financial results for the first quarter ended March 31, 2019 and also describing the company's recent business highlights. You can access a copy of this announcement on the company website at www.cerus.com. I'd like to remind you that some of the statements we'll make on this call relate to future events and performance rather than historical facts and are forward-looking statements. Examples of forward-looking statements include those related to our future financial and operating results including our 2019 financial guidance and goals, and operating expenses and gross margin, commercial development efforts, future growth and growth strategy, future product sales, product launches, ongoing and future clinical trials, ongoing and future product development, and our regulatory activities, as well as timing of these events and activities. These forward-looking statements involve risk and uncertainties that can cause actual events, performance and results to differ materially. They are identified and described in today's press release and under Risk Factors in our Form 10-K for the year ended December 31, 2018 and our Form 10-Q for the quarter ended March 31, 2019 which we will file shortly. We undertake no duty or obligation to update our forward-looking statements. On today's call, we'll begin with opening remarks from Obi, followed by Carol, who will provide an update on our red cell development program. Kevin will then review our financial results, and finally Obi will conclude with closing remarks. And now it's my pleasure to introduce Obi Greenman, Cerus' President and Chief Executive Officer.

Thank you Tim and good afternoon. In Q1 our commercial team delivered our highest ever quarterly product revenue with the U.S. market adoption of INTERCEPT platelets as the key driver of growth in the quarter. Given the strong start to the year, we are raising our 2019 product revenue guidance to $71 million to $74 million. Kevin will provide additional financial details later in the call. Several recent events demonstrate increasing global recognition of the role that pathogen reduction can play to reduce the risks associated with transfusion transmitted infections as well as expanding the pool of eligible donors. A recent publication by CAPAL [ph] and transfusion describes a potential window period HIV transmission case in France. Upon detection of both, HIV antibodies and nucleic acid in a new donation, the donor's previous donation was evaluated and found to be positive for low levels of viral RNA. Platelets from this donation had fortunately been treated with INTERCEPT and transfused, and lack of HIV transmission to the recipient was confirmed. The authors conclude that the risk of window period donation escaping detection by nucleic acid testing is infrequent but real. Donors that flows under important complement to infectious disease testing but this added layer of protection comes at the expense of excluding a significant number of willing blood donors. In Q1, we saw progress in the U.S. toward use of pathogen reduction as a substitute for both, malaria travel deferrals and the current 12-month deferral for men who have sex with men or MSM. In February, the FDA published an updated list of variances approved for individual blood centers who have requested use of alternative methods to comply with FDA regulations. This list now includes a variance which allows the blood center to accept donors, who otherwise would have been deferred due to travel to a malaria endemic area in the past year, as long as the platelet donation undergoes treatment with the INTERCEPT blood system. The March Blood Products Advisory Committee meeting or BPAC meeting included a session exploring potential changes to the current U.S. MSM deferral policy. Allowing MSM donations could help increase the donor pool, as well as address the challenging issue of perceived discrimination for blood services. One blood center discussed they recently submitted variance application requesting that the FDA allow the 12-month MSM donor deferrals to be waived when the platelet donation is treated with INTERCEPT. As a final comment on evolving blood safety policies, we continue to expect a final FDA guidance document on bacterial safety to be published later this year. Bacterial safety of platelet components is a dominant topic in our interactions with the U.S. blood centers and hospitals. Our commercial organization is very focused on a readiness plan to accelerate INTERCEPT adoption following this publication, supporting our largest blood center customers to ramp the majority of their overall platelet production to INTERCEPT platelets in matching the demand that we expect from U.S. hospitals. To this end, the rapid rate of BLA approvals by the American Red Cross since their initial approval last December, gives us confidence that they will be able to better meet the developing demand from their hospital customers. In addition, we are seeing the other four major blood centers in the U.S. ramp their production capacity in BLAs as well. Our efforts in other geographies are also progressing. All four German Red Cross blood centers have initiated submission of marketing authorization approvals or MAAs to the Paul Ehrlich Institute or PEI. We are now seeing the first MAAs by other blood centers and hospital-based transfusion services in Germany. It is encouraging to see the MAA turnaround time by the PEI, and the level of engagement from the major German blood centers. Most recent data coming out of the PEI for 2016 and 2017, may provide some rationale for this increased engagement on the part of the PEI and German blood centers. Seven documented cases of septic platelet transfusions and three associated fatalities have called into question the utility of current measures to address platelets safety in Germany. In regards to our CE mark submission on INTERCEPT red blood cells, last week we met with a TUV, our notified body to discuss the status of our submission and the process for bringing on new suppliers for INTERCEPT red blood cell program. It was a constructive meeting covering a variety of topics in our regulatory dossier, but given the need to qualify a new glutifying [ph] supplier, our approval timelines will be extended. To provide some additional color on the CE Mark submission, and the nature of the questions today, I would like to turn the call over to Carol to give us an update on the TUV meeting, the regulatory strategy, and our development programs in the U.S.

Thank you, Obi. Glutathione or GSH is a quenching agent used in the INTERCEPT red cell treatment process. To-date our GSH supply has been sourced through an Italian company which was chosen due to their long experience in the field as one of the largest global manufacturers of this compound. Unfortunately, this supplier has been experiencing financial challenges, and ultimately went into receivership. We had expected that the company would be sold to another party but no bidder emerged during the auction process in April. This recent development has impacted our ongoing CE Mark review, because suppliers named in the application need to be available for regulatory authority questions and audits as the review progresses. To ensure long-term availability of this key reagent, we have been investing alternate GSH suppliers for some time. Over the last year or so, we screened 10 potential suppliers and have been in the process of qualifying two finalists to support our ongoing clinical and anticipated commercial needs. Rather than adding these suppliers post approval, we now need to submit manufacturing and stability data from at least one supplier as a supplement to our CE Mark dossier, in order to complete the review. We believe we will have new GSH lots manufactured by the middle of next year, and be able to initiate 12-month stability studies at that point. The additional time necessary to incorporate new GSH manufacturer data into our dossier will also trigger the need to be approved under the new European regulatory requirements, that go into effect as of May 2020, for all CE marked medical device products. Assuming the original 15-month minimum review duration, our December 2018 submission, could have been approved just before the new standard called the Medical Device Regulation or MDR becomes effective. Now we plan to work with our regulatory authorities to transition to the new standard as part of the ongoing review process. While we are confident that we'll be able to meet the updated requirements, the MDR is a more comprehensive and detailed format and this does factor into our thinking on the revised approval timeline for INTERCEPT red cells. In light of the combination of these two timeline factors, we think it's appropriate to expect that the CE Mark approval and product launch will now be a 2022 event. We want to endeavor to find opportunities to compress this timeline where possible. In no way does this timing adjustment change our conviction in the important unmet need for pathogen reduced red blood cells. Red cells remain a critical part of our INTERCEPT portfolio globally, with their potential to reduce transfusion transmitted risks for the most frequently transfused blood component. Regarding clinical activities in the U.S., enrollment in RedeS, our Phase III red blood cell study continues to enroll at a steady rate as we look to engage additional study sites. With regard to our ReCePI study in cardiovascular surgery patients, our near-term focus is to expand the number of participating hospitals in 2019. By the end of the year, we're targeting 10 active sites recruiting in the ReCePI study. With that, let me turn it over to Kevin to discuss the first quarter financials.

Thank you, Carol and good afternoon, everyone. Today we reported our highest product revenue quarter with Q1 2019 product revenue totaling $17.5 million, a 29% increase over the $13.6 million reported during the prior year. The product revenue growth we experienced during the quarter was driven by higher disposable kit demand from existing customers. Both, North America and EMEA contributed to the growth in global kit demand which was up 35% when comparing Q1 2019 to the prior year period. Platelet kits accounted for approximately 90% of product revenue during the quarter. As Obi noted earlier, given the strong start to the year and visibility into our commercial outlook, we are raising our full year product revenue guidance to a range of $71 million to $74 million, compared to our previous guidance range of $70 million to $73 million. We have seen headwind in foreign exchange rates which may continue, and we expect the French utilization of our higher margin double those kits will continue to increase. However, given the strong underlying kit demand, we feel confident in raising full year revenue guidance. Separately and not included in our guidance, government contract revenue during the first quarter of 2019 was $4.5 million, compared to $3.5 million dollars during Q1 of 2018. Government contract revenue is reported as a result of our contract with BARDA. I'd now like to turn the discussion to other first quarter results. Gross margins on product sales for the quarter were 52% compared to 46% for Q1 of 2018. The year-over-year improvement in gross margins was attributable to a favorable product mix with increased sales of our double dose platelet kits which provide higher gross margin than other products. In addition, we continue to realize lower cost of goods due to increased manufacturing volumes and economies of scale. I'd now like to discuss operating expenses which were $29.6 million during the quarter compared to $23 million during Q1 of 2018. Of the total $29.6 million of operating expense reported during Q1, SG&A expenses accounted for $16.2 million compared to $13.6 million in the prior year period. As we have previously discussed, we have made investments in key areas surrounding manufacturing, supply chain and quality. We believe these investments will allow us to confidently scale, and will ultimately serve us, the patients receiving our products and our investors well. Research and development expenses accounted for $13.4 million during Q1 compared to $9.4 million during the prior year. The increase was primarily tied to higher costs associated with the regulatory and development activities surrounding our INTERCEPT red blood cell system in both, Europe and the United States. Net loss for the first quarter of 2019 totaled $18.8 million or $0.14 per diluted share compared to a net loss of $13.9 million or $0.11 per diluted share for the prior year period. In terms of our balance sheet; we ended the first quarter with more than $100 million of cash, cash equivalents and short-term investments compared to approximately $118 million at the end of 2018. Cash used from operations during the quarter totaled approximately $22 million. Given the growth and expected future growth in the business we made significant investments in working capital during the quarter, primarily inventory build, increased receivables, as well as a pay down of certain liabilities. These current quarter working capital investments totaled approximately $9.5 million. In the prior year period, these same line items were a significant source of cash. While we expect the pace of these investments will be much more muted going forward, we also now have a revolving line of credit to use as we invest in growing the business. To that end, during Q1 we strengthened our balance sheet with the new expandable debt facility of upto $90 million. The flexible debt facility consists of a $40 million initial term loan with options on two $15 million tranches. And while not drawn upon in Q1, the facility also includes a $5 million revolving line of credit that is expandable upto $20 million. The new facility provides us with additional availability of capital, a longer and more flexible 36 month and potentially 48 month interest only period, a lower cost revolver and the ability to further lower interest payments should rates contract. With that let me turn it back over to Obi for some closing comments.

Thank you, Kevin. Before we wrap up the call I would like to touch on our cryoprecipitate program. We continue to be excited about this new opportunity and the potential impact it could have on patients' lives. Increased availability and the earlier use of cryo could potentially improve patient outcomes and facilitate improved treatment algorithms for critically bleeding patients. We believe the U.S. market opportunity for cryo could be north of $200 million annually and are investigating the potential opportunity in other markets around the world. To further support our initial product launch, we expect to sign imminently our fourth cryo manufacturing partnership. Our manufacturing footprint for this product launch is extending to both coasts of the US and in the south and southeast. With our ongoing discussion with the FDA under our Breakthrough Device Designation we're looking to further optimize our product label for the launch. This may extend the regulatory submission to the first half of next year and in the outcome of the discussions with the FDA in the second half of this year, and some additional studies we may consider undertaking to support the labeling optimization. To reiterate, we are pleased by the strong commercial start to 2019 led by our sales organization and the steps the team is taking in preparation for the final FDA bacterial guidance document outlined in this year's FDA CBER guidance agenda. We believe the publication of the final guidance could be a transformational event for Cerus. As we stated before, given the growing awareness on the risk of bacterial transfusion transmitted infections, we believe that we are well positioned to deliver robust top line growth and achieve our near term revenue goals, regardless of the guidance document. But, we think that the publication could accelerate the rate of market adoption starting in the second half of 2020, assuming a 12 month compliance period for the final guidance. Given this anticipated potential inflection point in our prospects for growth and the need to ensure access for patients, hospitals and blood centers, we will continue to prioritize our supply chain continuity, capacity expansion and quality improvement efforts throughout 2019 and into 2020. In closing, I would like to take this opportunity to recognize and acknowledge the efforts and dedication of the Cerus team, that strive each day to bring pathogen reduction to patients around the globe. With the increasing awareness of pathogen activation from national blood services worldwide, the team here at Cerus is very motivated by the prospects of delivering on our long held mission to make INTERCEPT the standard-of-care globally. With that, let me turn it back over to the operator for questions.

[Operator Instructions] And our first question comes from Sung Ji Nam from BTIG. Your line is open.

Thank you. Congrats on the quarter. Maybe starting out with cryo. What -- I think -- previously you had mentioned, you talked about the fourth manufacturing partnership, I think potentially adding five to eight this year. I was wondering if -- I know there are some BLA potential down the road for interstate possibilities of the supply chain, but was curious as to with the initial five to eight manufacturing partners, what percentage of the total addressable market does that address with just -- within those respective states?

Yes. I think that the capacity from the sites that we're identifying for launch is going to be pretty large. And so the purpose of our identifying's were to five to eight sites by the time we launch the product as really so that we have a footprint prior to the availability of the BLAs. So the BLAs will allow interstate shipment of cryo manufactured within a certain state. That -- we have enough of a footprint in the states where we launch that that we really can have a big impact and then subsequent to the BLA we will be able to ship across the country. I think the goal really is for those five day sites to be sufficient to meet the overall demand in the market. And so we're looking at, both sort of regionally well-placed blood centers but also large blood centers to make up those five date sites.

And then just on the final guidance for bacterial safety. I was curious as to kind of the strength this quarter in the U.S. for platelets. Was any of that driven by the anticipation of that final document. I was curious as to if there might be some early adopters just trying to get ready in preparation for the finalization of the document later on?

Thanks, Sung Ji. I think Vivek Jayaraman, our Chief Commercial Officer is on the phone and he's probably best to answer that question.

You know, we certainly look forward to guiding things finalized and leave it as the opportunity continue to drive and catalyze growth in the U.S. So what we're seeing encouragingly is a recognition of the value that ERT technology offering that transcends bacteria. And so as we had mentioned previously and we really focused our U.S commercial effort on engaging the top five blood centers in the U.S that account for 70% of the total volume and it was great to see analysts coming through and our results they really have started to embrace the value proposition with CR technology understanding that does lead the similar product components for their hospital customers and we think if anything gynecologist sort of further emphasize that point. But we're working closely with them their hospital customers to ensure that they're ready should guidance drive faster adoption. But I think what's most encouraging for us is the strong underlying growth that's driven by these blood centers realizing that they can provide a safer product to their customers.

And then, just lastly, you had talked about having the triplet dose kit available in 2020. I was curious as to if that's still on track? And then also seven day label, could that be potentially available as well in time for the bacterial safety guidelines.

Yes. Those are two critical label claim extensions that we have for the INTERCEPT platelet platform, and just to remind you that we do have that product approved in Europe the triple storage set and are looking to get that product approved and likely submitted in 2020. So I don't want to speculate on the approval timing but clearly the goal for us is to get both the seven day label claim submission and TS set submission in 2020. And so I think sort of I guess I would more say towards the end of that compliance period we would have the full portfolio. That being said, we really don't see an impact right now on not having the TS kit, just given the ability of the top five blood centers, for example, to ramp production to sort of the 60% level. I think the TS kit will make it that much easier for them, but over the course of the next 18 and 24 months, we hope to have everything in place to have the optimal product offering.

Thank you. Our next question comes from Drew Jones from Stephens Inc. Your line is open.

Just thinking about kind of kit growth trends there, appreciating everything that's going on in the U.S. and on the platelet landscape. Could you maybe walk through was there any contribution from either Germany or maybe plasma in the period? And is there -- how much if anything is contemplated in guidance for the year?

Kevin, you provide the specifics on that one as you take a shot at that question.

There wasn't a lot of contribution from Germany as we expected. We believe that towards the end of the year we will start to see some nascent contribution from Germany, but that meaningful revenue wouldn't occur until after 2019. As far as platelets or -- I'm sorry, plasma was concerned, we did see some sales -- some incremental sales for plasma, really broadly, nothing in the United States yet. But traditional areas in Europe, particularly, the distributor areas; we did see some plasma demand. All of that is contemplated in our guidance.

And then, thinking about cryo; you guys alluded to other territories, other countries, geographies that are showing interest here. Can you give us any color around that? And maybe what some timelines would look like there? And I guess it goes hand-in-hand with the new plastic components submission maybe an update on that front too for the kits -- the plasma [ph] kits?

So, in certain markets cryo is still a product that's used pretty frequently in wastage associated with thawing cryo and not using it is a problem. So the improved label that we're looking for with the five day thought shelf life has advantages, specifically in markets like the U.K. for example. So I think there is interest. We obviously need to get the product first approved in the United States that's where our focus is. In other markets, there is a strong sort of bias towards fibrinogen concentrates manufactured by a couple of plasma derivative manufacturers. And that being said I think that with some of the studies that we're doing and the dialogue we're having with folks who treat coagulopathy and trauma and maternal hemorrhage that the full value of the constituents of cryo precipitate so not just the fibrinogen but also Factor 13 and one roll brands factor are important to a bleeding patient and so I think that there we're looking at how do we introduce the product into these markets that have historically been dominated by fibrinogen concentrates and just sort of start that process. Just given that there is an overarching understanding of coagulopathy in those markets and the use of active coagulation monitoring during the procedures. So I can't give you any timelines to date, but we're looking at sort of the CE marking process in Europe with the new disposable and what's going to be required there. But our priority focus clearly is on the United States given the size of the U.S. market.

And then last one for me, the supplier issues with red blood cell, does that have any impact on the domestic timeline?

It does not. So we have enough clinical material for the studies underway in the US. So it's primarily an impact on the CE Mark review timing.

Thank you. And our next question comes from Josh Jennings with Cowen. Your line is open.

Good afternoon and thanks for taking the questions and congratulations on a strong start to the year. I was hoping to just follow-up on the U.S. performance in the quarter and just some of your commentary around the non-American Red Cross major blood centers. I think some of the focus has been on the American Red Cross has ramped, but you've said in your prepared remarks talked about the other four major blood centers ramping as well, in front of the mandate from the FDA with the final guidance. And then also seeking BLA. I just wonder if there's any other incremental color you can help us with those four major blood centers non-ARC. And are they on the same path as American Red Cross? American Red Cross is very vocal towards you in the last year or this year including at ABB about their plans to significantly ramp up INTERCEPT platelet production?

Yes. Thanks, Josh. I'll probably turn that over to Vivek and we had all representives from all of the five largest blood centers out here and conquered a couple of weeks ago just for a round table discussion around sort of the guidance document and sort of preparedness and how to think about pathogen reduction? Pathogen reduce platelets in the marketplace. So I think the Vivek is well-placed to do some good commentary on that.

Thanks, Obi. Thanks for the question Josh. Well we are really excited about the partnership we have with the American Red Cross and they certainly are setting with standard in terms of actively adopting and chanting after reduction technology. They're not alone as Obi indicated, we brought senior level executives from the top five blood centers in the conquered User Group and Networking meeting and what was most encouraging to see is that all of them really view that has a strategic imperative and something they intend to utilize both in the run up to final guidance and certainly on the other side of it as well. There are varying degrees along the continuum, but what we're seeing is active -- a lot of activity around securing BLA really active engagement from a hospital awareness and education standpoint, and working closely with our deployment organization to ensure that their collections and productions procedures are aligned in a manner that can optimize INTERCEPT production. So, we have a lot of confidence our ability to drive growth in the US not only with our partnership with the ARC but really with the large blood centers across the country.

Thank you. And our next question comes from Craig Bijou from Cantor Fitzgerald. Your line is open.

This is Jordan Abrams is on for Craig. Thanks for taking the questions. So you just touched on it a little bit but talking about the company's plans for increased capacity in light of the final guidance document. But on the blood center side, are they analyzing the potential financial impact assuming that the final guidance document, it closely mirrors the draft guidance document?

Thanks, Jordan. I think I'll turn it over to you Vivek again because he was in the dialogue a couple weeks ago with all the large blood centers and this was actively discussed.

Yes. You know, this is something they pay close attention to both from a production cost standpoint, as well as average selling price to the hospital. And I think also we've talked about in the past in the outpatient setting, there is a discrete payment associated with pathogen-reduced platelets and also what the blood centers have experienced is the ability to charge and maintain a pretty healthy uplift when you look at pricing for conventional platelets versus pathogen reduced platelets. So they see that as taking their -- really, their most profitable product line and improving their profitability; and as they get more comfortable and start to manufacture at scale they're seeing the subsequent benefits from a production optimization and cost standpoint. So they're keenly aware of running their business and I think they view pathogen reduction technologies as really healthy for their business, while of course, being of clinical value and important for physicians and patients.

And then, also -- you mentioned product gross margin was impacted by favorable product mix, and also the higher use of margin of higher margin kits in France. Can we expect the higher product gross margin to be sustained in '19 or how should we be thinking about that?

Yes. I think we expect that it not only will be sustained but will grow. And then there are two factors for that; one is as you mentioned the conversion of the French from a single dose platelet kit to a mix of double dose platelet kits and single dose platelet kits. But also in the United States where blood processing is highly optimized, they have the wherewithal to use a higher percentage of double dose kits than we've seen historically in EMEA, and we expect that as the U.S. naturally grows and becomes a larger and larger relative contributor to our top line that we'll see margin expansion there.

Thank you. And we do have a follow-up from Josh Jennings from Cowen. Your line is open.

Thank you. Let me get back in the queue. I was going to just ask about the CE Mark approval timeline guidance that was revised in the glutathione supply issue. I understand the MDR is more onerous pathway but can you just help us understand what will be required and what drove that push out to 2022? Will you need more clinical data, is that the assumption there or what exactly is going to take -- is the requirement? What exactly is the requirement that's going to drive that kind of year plus push out of approval timeline?

I'll let Carol handle the specifics but Josh, it is a high level, what we're having to do is qualify a new main GSH supplier for the submission; and that's underway, we'll be manufacturing lots this year and final commercial lots next year, and that dataset has to be submitted as part of the dossier. So that's what is responsible for pushing out the review timeline from an MDD submission to an MDR submission. But Carol may be able to provide a little more context about what that means because the product is under active review by the TUV now, and -- so I think our -- providing those timelines is just out of conservatism, because we don't -- there is still some uncertainties that exists with regard to that transition to the MDR. Do you have any additional context, Carol?

Sure, thank you Obi. So back in 2017, the European Union decided that the CE Mark medical devices were really all meeting different standards, so they decided to develop a universal standard for all CE Mark products, and all CE Mark products now have to go through this re-registration process that begins in May of 2020. So it's our assessment based on the guidance documents that are available to us that the MDR process is really a more detailed presentation of the data that we believe we already have. So we don't anticipate any new clinical data, and I don't think at this point we anticipate even any new studies. But the presentation of the information does change, and our notified body is just completing their own certification process; so they can guide us better. But when we met with them last week, it's their intent to help us walk through the transition from the current license into the new MDR license. And we anticipate that will be a fairly seamless process and they're going to be advising us as they review our documentation in the current application, how to either modify it or strengthen it or any additional information that will be required to get us through the MDR process.

Okay, great. So that -- just to be clear, you don't believe you're going need to run another clinical trial for CE Mark approval?

No. We don't believe that that will be necessary but for a CE Mark product, it's a question of safety and performance of the device, that's what's required for CE marking; and we believe with all of the data that we have, and of course, we are in U.S. clinical trials, so perhaps those will help us also address information that might be needed. We believe we have the safety and performance of the device data that we need.

And then, just one last one just on the same topic but a follow-up from previous question on the call; it's just about the U.S. red blood cell trials. Is that glut -- are you -- do you still have glutathione supply and are you able to supply INTERCEPT kits for red blood cell units for enrollment? Or -- I mean, I just wanted to make sure -- I'm sorry for the confusion but just wanted to make sure...

Yes. To answer the question; yes, we do. So the studies are still enrolling and we have existing supply.

And then there is going to be no issues in terms of complete enrollment of the current trial as well as the chronic trial, it's on the term?

Yes, that's our assumption right now. Yes.

Great. All right, thanks so much for taking the questions.

Thank you. And I am showing no further questions from our phone lines. I'd now like to turn the conference back over to Obi Greenman for any closing remarks.

Well, thank you all for joining us today, and for your interest in Cerus. Goodbye.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program. You may all disconnect. Everyone, have a wonderful day.