Savara Inc. (SVRA) Q2 2015 Earnings Report, Transcript and Summary

Good morning. And welcome to the Mast Therapeutics Corporate Update Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Ioana Hone, Head of Investor Relations at Mast Therapeutics. Please go ahead.

Thank you, Laura, and good morning. During this conference call, we will make forward-looking statements within the meaning of federal securities laws, in regard to our business strategy, expectations and plans, our objectives for future operations, and our future financial conditions. All statement other than statements of historical facts are forward-looking statements. Such statements may include words such as belief, could, would, will, plan, intend, and similar expressions. You are cautioned not to place undue reliance on forward-looking statements, which are only predictions and reflect our belief based on current information and speak only as of today, August 13, 2015. For a description of risk and uncertainties that could cause material differences between our actual results and those stated or implied by the forward-looking statements, please see our quarterly reports on Form 10-Q, filed with the Securities and Exchange Commission on August 12, 2015, which is available on our corporate website www.masttherapeutics.com and at www.sec.gov. With that, I would like to turn the call over to Brian Culley, Chief Executive Officer of Mast Therapeutics.

Thank you, Ioana, and good morning, everyone, and thank you for joining for today’s call. With me today is Brandi Roberts, our Chief Financial Officer; and on the phone is Ed Parsley, our Chief Medical Officer, who is actually on the road, evaluating sites for our heart failure study, but Ed will be available to answer questions at the conclusion of this call. I’ll begin with the most important item and that, of course, is the progress we have been making with our lead candidate, vepoloxamer in sickle cell disease. As you will recall, we are running a 388 patient pivotal Phase 3 study called EPIC to demonstrate that vepoloxamer can reduce the duration of vaso-occlusive crisis. We opened our first site in January of 2013 and are now actively enrolling at over 70 sites in more than 10 countries, with approximately two-thirds of those sites located in the U.S. We are pleased to report that our EPIC study is now more than 70% enrolled. This means that Mast has now enrolled more patients in an interventional sickle cell disease study than any other company and thanks to an incredible effort by our clinical operations team. I am pleased to reiterate for you today that we are on track to enroll the remaining patients in line with our guidance and report topline data from EPIC in the first quarter of 2016. An abundance of clinical and non-clinical data showing the vepoloxamer improves blood flow, which can be expected to shorten the length of crisis and reduce the amount of damage to vital organs, as well as patient demographic data we have reviewed from the EPIC study, gives us optimism for the outcome of our Phase 3 study. Thus, we have been working to enhance our EPIC data set and our new drug application with several supporting clinical studies. First, we completed and announced the positive results from the 60-patient thorough QT study, demonstrating that vepoloxamer had no adverse effect on QT interval. More recently, we initiated a repeat dose study called EPIC-E, which we plan to make available to anyone who has completed the EPIC study. In addition to expanding our existing CT database with repeat exposure, EPIC-E also will provide physicians and patients with experience using vepoloxamer in an unblinded fashion. Third, we are planning to conduct a study in special population of approximately 30 renal impaired patients to enhance dosing information in our label. These studies have a very specific purpose. Our objective with them is to deliver to the FDA a comprehensive and robust data package to help ensure vepoloxamer is approvable and utilized in the most appropriate way for each patient. Thus each of these three clinical studies and the tissue oxygenation sub-study within EPIC are intended to enhance our new drug application and provide the agency with supporting evidence above and beyond the 388 patient EPIC study to demonstrate vepoloxamer’s safety and tolerability for patients with sickle cell disease. Important to note the enormous unmet need for new therapy for sickle cell patients. Although, it qualifies as a rare disease in the United States and Europe, there are still around hundred thousand people with sickle cell disease in the U.S. and millions more worldwide. However, there is only one FDA approved treatment, hydroxyurea. But it was approved more than 17 years ago. It’s only used by about 20% on U.S. patients and it has not been shown to reduce the duration, of course, severity of the crisis once one begins. As a result, sickle cell patients hospitalized for crisis, spend an average of four to five days, suffering an indescribable pain, requiring an high doses of parental opioids and during which time the obstruction of blood flow is causing tissue and organ damage, leading to severe complications, organ failure and ultimately an early death. Mast is deeply committed to breaking these [indiscernible] therapies for sickle cell patients. Remarkably, aside from hydroxyurea none of the clinical approaches tried in the past have worked, including antisickling agents, anti-inflammatory, platelet inhibitors and oxygen-dissociation curve shifters. The extensive clinical record is clear that the first sickle cell disease is so complex, approaches which target a single pharmacological event do not work, so we and many disease experts believe a multifaceted approach if necessary to change clinical outcomes in sickle cell disease. Notably, non-clinical study have demonstrated that vepoloxamer doesn’t just improve blood flow, but also reduces hemolysis, protects against reperfusion injury and reduces adhesion among and between red, white and endothelial cells, all of which could be occur during the crisis. Mast has generated data on each of these attributes and there is no other agent in development with all of these properties. So we believe we alone have a treatment with enough pharmacological horsepower to improve outcomes for these patients. That being said, it’s worth speaking briefly to the several developments which has occurred in the sickle cell landscape since we began the EPIC study more than two years ago. In particular there was an announcement recently that the sickle cell patient had undergone first ever gene therapy treatment. We care deeply about sickle cell patient as evidence by our creation of a drug development conference, patient communication and [indiscernible] contest, our [indiscernible] were highly supportive and we welcome new entrants into this underserved indication. However, publicly available estimates for the eligible patient population for sickle cell gene therapy range from just 5% to 25%, that means at even if the technology proves to be safe, effective and durable, 75% to 95% of these patient populations still would be left without any treatment options. In contrast, we believe vepoloxamer would not suffer from those same patient eligibility limitations, because as a biophysical agent it performs regardless of genotype, disease severity or age of patient. With respect to other new compounds and clinical development, vepoloxamer remains the most clinically advanced option and unlike agents with just fixed or needing 60 exposures vepoloxamer has been administered to hundreds of patient in multiple trials. We believe that vepoloxamer’s extensive development history provides safety data that no other drug candidate can match. We also currently enjoy a two and a half year head start on our closest competitor. And in some cases, our lead could be five or more years based on reasonable estimates for the unpredictable regulatory process. Meanwhile, we're in the home stretch of our Phase 2 trial. Our plan, of course, would be to use our significant lead time to establish vepoloxamer as the standard of care for a wide spectrum of sickle cell patients and then broaden its use for series of post-marketing studies, the details of which, we’ll at this time keep confidential for competitive reasons. For those who are not familiar with this patient population and what it means for commercialization, sickle cell disease offers a size of the market opportunity especially for the first drug market. In the U.S. alone, there are approximately 100,000 hospitalizations for sickle cell disease each year, with half of those occurring in just 16 metropolitan areas. Similarly, in Europe, there are approximately 40,000 patients with half of those patients residing in just two cities, Paris and London. Clearly, this is a concentrated patient population and as we get closer to the completion of enrollment in the EPIC study, we will begin sharing our commercialization plans, including our thoughts on optimal pricing and reimbursement strategies. Because we plan to obtain the first drug approval for sickle cell patients in more than 17 years, we believe that vepoloxamer will enjoy unprecedented awareness in the physician and patient communities and we nonetheless have work to do to prepare for that yet. Fortunately, we’ve got a great team working on this topic and we look forward to sharing more of our commercial plans in the coming months. We've been extremely focused on enrolling our sickle cell Phase 2 study and have produced excellent results from those efforts. But I’d like to note that we are also excited about our other clinical programs because we can potentially reach even far greater number of patients in diseases such as heart failure and stroke. In particular, we remain on track to initiate next month a Phase 2 study of vepoloxamer for the treatment of chronic heart failure. Positive results from randomized placebo controlled and repeat treatment studies of vepoloxamer in model of heart failure as well as recommendations from medical experts in the field, support our efforts to begin clinical development of vepoloxamer in chronic heart failure. If the promising results in models to date, translate the patients with heart failure that vepoloxamer may offer a way of directly improving left ventricle contracted function by restoring cardiomyocyte membrane integrity and increasing survival. Our heart failure protocol has been reviewed by the FDA and as I mentioned at the outset, we are getting sights lined up to begin this study. We plan to enroll approximately 150 patients to evaluate the safety and efficacy of a single administration of vepoloxamer compared to placebo and with all the vepoloxamer’s effect on troponin and NT-proBNP mark this a cardiac injury and wall stress respectively as well as clinical outcomes. We expect to conduct this study on an outpatient basis at medical centers both within and outside of the U.S. Importantly, we also filed patent applications claiming the use of vepoloxamer in this and other clinical studies of heart failure. And we are working on divergent strategies so as to preserve the option to partner heart failure either with or without sickle cell disease. With respect to our efforts in arterial disease, we have a very positive update to share today. Stroke represents an enormous market opportunity while ALI conversely develops a very smaller orphan disease, much smaller in fact than sickle cell disease. But as we have said for some time, we believe our clinical study in acute limb ischemia for necessary to validate the stroke program because expertise field wanted to see how vepoloxamer worked on leg clots before moving on to stroke. However a growing body of nonclinical data in stroke that we and others have generated over the last 18 months, including a study conducted by Dr. Michael Chopp of Henry Ford Hospital in which vepoloxamer significantly reduced infarct size with no effects on the incidence of hemorrhage, recently let us back to some of those same experts to assess whether vepoloxamer was now ready for a clinical campaign in stroke without data from the ALI study. We are very pleased to share that following recent meetings for some of the world leaders in the stroke field, we have decided to initiate a clinical development program in stroke. The comments we received from the experts were extremely positive. And we’ll be working with the same physicians to develop a regulatory and clinical strategy for vepoloxamer in ischemic stroke with a goal of demonstrating that vepoloxamer can improve microvascular perfusion and reduce infarct sizes in patients. Now because the ALI study was not expected to complete until the end of 2016 and its utility as a gateway to the stroke market has been superseded by this new data. We have decided to discontinue the ALI program. By doing so, we will be able to reallocate approximately $4.6 million over 2015 and 2016 to our other programs. I’ll now shift to our second asset, AIR001 program. Based on the positive hemodynamic effects observed in phase 1 and phase 2 studies of AIR001 in more than 120 healthy volunteers in patients with various form of pulmonary hypertension, we believe AIR001 maybe uniquely suited to address the serious unmet needs of patients with heart failure with preserved ejection fraction or what’s known as HFpEF. To affirm AIR001 potential in that patient population, we currently are supporting two institutional sponsored Phase 2a study of AIR001 in patients with HFpEF. We anticipate reporting preliminary data from the first of those studies in the fall of 2015. That trial is enrolling approximately 30 subjects in a randomized double-blind placebo controlled study to evaluate the effects of AIR001 on resting and exercise hemodynamics in patients with HFpEF. And in results from this Phase 2a study, we expect to make a decision with respect to conducting a Phase 2b proof-of-concept study of AIR001 in HFpEF patients either on our own or with the partner. Before I turn the call over to Brandi to update you on our financials, I want to make a few comments about our business, financing strategies and share costs. We’ve realized we have a special opportunity here. And so far as we own nearly 100% of the vepoloxamer worldwide commercial rights and because the patient population sickle cell disease is so concentrated, it is attractive for us to commercialize ourselves and we are positioning this business with commercialization in mind. In parallel, we will evaluate licensing and partnership opportunities. But even if we decide to license rights to vepoloxamer, a sound commercialization plan will be an asset at those negotiated tables. So therefore to prepare for commercialization, we are now spending more on NDA preparation for commercial strategy and readiness and other activity that make the asset more valuable. Even with substantial savings from the conclusion of the ALI study, we still need to consider how best to finance this company. We believe a mix of several strategies provides diversification, flexibility and puts our shareholders in the best possible position. Thus, we employ and approach, which includes traditionally equity financings, an ATM vehicle and as we discussed in our most recent 10-Q, our debt facility. It clearly isn’t attractive to raise capital at these low prices, but we believe our debt instruments is a preferable solution for our investors at this time. We thoroughly evaluated debt providers and they are pleased to have entered into a partnership with Hercules Technology Growth Capital, a recognized leader in growth capital financing. I want to ensure that everyone understands that this facility is baked at not convertible debt that does not require us to maintain certain cash minimum on our balance sheet. We view Hercules as a long-term partnership and this deal has been setup opportunistically with no obligation for us to take any money above the $5 million we received this week. However, Hercules did provide the option on the additional $10 million of debt if certain conditions are met. As I explained, we value financial flexibility, so any divisions on drawing additional money will be made in the future as events unfold and more data and information is generated. Meanwhile, we believe establishing this relationship with Hercules is preferable to additional equity issuances and we appreciate Hercules showing confidence in Mast’s long-term business strategy. Next, I want to make a comment about our ATM. The ATM also gives us additional financial flexibility because we can choose when and how or whether to utilize it at all and it allows us to push traditional more dilutive financings into the future or minimize their size until our share price might be higher. The ATM also offers a company superior cost of capital in terms of both dilution and fees. Currently, there is approximately $12.5 million available under the ATM program. However, our current shelf S-3 is expiring and we intend to reset our ATM, when our new S-3 registration statement goes effective later this month. I want to point out that the company sold approximately $15 million of stock last year at an average price of $0.74 with no warrants, terms superior to our last financing. In contrast to 2014, our share price has been lower this year and consequently, we almost sold about $2 million in stock in the first six months of this year. This significant reduction in ATM use should tell you a lot about what we think about our current share price. Again, we are planning to success and want to ensure we have several options available for us to choose from in terms of financing the company. Our combination of debt, additional equity, the ATM and critically evaluating our expenses provides us with that flexibility. Now finally, with respect to share price, Mast by far has the most clinically advanced new drug in the sickle cell space. We have more human drug exposures and safety information than anyone else. We’ve also produced a long and consistent line of positive data since acquiring vepoloxamer in 2011 and yet, we are being severely undervalued by the marketplace. Consequently, we are taking steps to try and reverse that situation. I have already spoken about using simple debt instead of equity and reducing the use of our ATM but those are supply considerations. We also need to focus on the demand side of buyers because there are so many newly public companies where investors fall and a lot of attention is being given to early stage sickle cell companies in particular. We want to ensure our story is known and appreciated by a wider audience of investors. Consequently, on September 3rd, we will be presenting at Fourth Annual Sickle Cell Drug Development Conference and on October 7th, we plan to host our first-ever Mast R&D event. Botsh of these events will be held in New York City and every investor and analyst in our database will be invited to attend. We also will webcast our R&D event on October for those investors who cannot attend in person. At the end of day, we believe the best way to reward our shareholders for their patience is to complete the EPIC study as quickly as we can and with the highest quality data possible, so there is no longer any uncertainty about vepoloxamer’s critical value. In the meantime, increasing awareness of Mast, announcing data from the AIR001 study and continued success with EPIC enrollment are several things we plan to deliver to you. With that, I’ll turn the call over to Brandy, to go through our financials and discuss our partnership with Hercules in greater detail.

Thank you, Brian. First, let me began by discussing our second quarter 2015 operating results. As of June 30, 2015, the company had cash, cash equivalents and investment securities totaling $43.4 million and stockholders' equity amounting to $42.5 million. Research and development expenses for the second quarter of 2015 were $7.7 million, an increase of $2.9 million, or 61%, compared to $4.8 million for the same period in 2014. This increase was due primarily to increases of $1.9 million in external nonclinical study fees and expenses, $0.8 million in external clinical study fees and expenses and $0.2 million in personnel expenses. Selling, general and administrative expenses of $2.4 million for the second quarter of 2015 were consistent with the same period in 2014. As Brain mentioned, this week, we entered into an agreement with Hercules Technology Growth Capital, under which we may borrow up to $15 million in two separate tranches. The company drew the first tranche of $5 million upon closing. The second tranche of up to $10 million is available this year at our discretion, provided that our vepoloxamer and AIR001 programs achieve certain clinical development milestones and we receive aggregate net cash proceeds of at least $15 million of upfront cash payments from one or more strategic corporate partnerships transactions and/or from one or more equity financings. We were able to also negotiate interest-only payments on borrows and bonds through June 1, 2016 and this period is extendable through March 1, 2017 if certain conditions are met. The company intends to use proceeds from the debt facility as additional funding for our developed programs and for general corporate purposes. Again, this is just straight debt with no conversion features. We strongly believe in vepoloxamer’s potential and are positioning ourselves for success. As a result, we expect to spend more capital on NDA preparation, the addition of new employees, commercial strategy and readiness initiative and other related activities that weren’t necessary earlier this year or last year. We anticipate the operating expenses for the second half of 2015, excluding share-based compensation expense will be approximately $18 million to $20 million. We expect our current cash position to take us through the announcement of EPIC data in Q1 and well into 2016. Let me turn the call back to Brian to disclose our corporate update.

Thanks, Brandi. Mast is proud to have identified and acquired vepoloxamer and soon we will be announcing data with it from the largest interventional sickle cell trial ever conducted. Since 2009, we’ve grown from just two executives to a team of 26 full-time employees who are preparing the business for clinical regulatory and commercial success. Mast is committed to bringing new treatments for patients suffering from severe diseases and we thank the patients’ families and caregivers for giving us this opportunity. I thank you also for joining the call today and for your interest and support of Mast Therapeutics. We are proud of our work and excited for the months ahead. We now would be pleased to take a few questions.

[Operator Instructions] And our first question comes from Yale Jen of Laidlaw.

Good morning. And glad for the progress you guys had made. My first question is that, in terms of the EPIC study, could you give us a little bit breakdown in terms of the adult and pediatric roughly at this moment?

Yale, one of the things that we have said is that, at our last update that the average age of patients in the EPIC study was 14. Currently, I think it’s crept up to as high as 15, essentially the same number. We don’t have a breakout for folks today in terms of the final number or the current number rather of people under 18 versus people over 18, but the average is obviously trending very young. And we don’t have any reason to think that there is going to be a meaningful change in that number between now and the end of the study.

Okay. Great. And for the renal impaired patient study that you just mentioned today, could you give us a little bit color in terms of its details and [what doubt] [ph] we also included in the filing package or that will be something subsequent to that?

So, one of the main reasons for conducting that study is of course to have appropriate guidance or instructions rather in our product label on how to utilize the product. So for example vepoloxamer could be accidentally overdosed. It is not known yet whether you could dialyze it off. Or if you have a patient who is in fact renally impaired, it would be good to know how to adjust dose. We like those instructions to exist in our package insert, and so that’s the reason for conducting that study. I will let Ed if he is able to here clearly jump in and comment on. I think Yale you asked about whether adults would be part of that study, is that correct?

No, I am trying to see, is this study going to start now or has already started, and would that be both in adult and pediatrics, and what kind of timelines that maybe completed the studies?

Okay. We intent to start seeing them and the purpose would be to have it available before to have that data in our NDA. And could you comment on what the patient profiles would look in that study, I believe it’s very conventional?

Yes. So this is a study that follows FDA guidance concerning special populations, thus it would be mostly an adult study likely in patients with multiple levels of renal impairment with the comparative placebo group.

Okay. Great. And the last question in terms of the stroke study, any additional color in terms of timeline or trial design were not at this stage? Thanks.

Certainly no specifics with respect to timeline yet or design but something that we will work through with those experts who we have met with. One thing I can say is that stroke is in the CNS division not in hematology. So we will need to submit an IND, so it’s not something that’s going to happen in next few months. In fact, we wouldn’t start -- we wouldn’t be in a position to start a clinical campaign even this year. So it maybe more likely than not that stroke would be something we would start in earnest after we see vepoloxamer’s data in EPIC. But meanwhile we can plan, prepare, file documents and otherwise be ready to have that option available to us.

Okay. Great. Thanks.

And our next question comes from Ted Tenthoff of Piper Jaffray.

Great. Thank you very much. So Brian, can you list the kind of support studies for EPIC again. There is a thorough QTC prolongation that you’ve done. There is the renally impaired and the repeat dose, is that [indiscernible] included as supplemental filing?

Yes. You listed them more correctly, the QT repeat dose in the special population. The approach we take conceptually is that we realized that there are strategies out there that some companies will employ where they rely heavily on unmet need to support their NDAs. We want to do whatever we can to make this application look like it’s not coming from an orphan drug. We want to supplement in any way possible and give the agency as much evidence and conviction that this is a treatment that’s well tolerated and provide the benefit to patients. So those three studies that I mentioned are separate studies. We also have a tissue oxygenation study, that’s baked within the existing 388 patient EPIC study and all of these are intended to layer conviction in place about vepoloxamer in these patients.

That’s really helpful. One quick for Brandi. Brandi, did you say that the brand would be around $18 million three year end, was that what I thought?

Yes, Ted. It was $18 million to $20 million for the second half of 2015.

Excellent. Well, thank you very much for the update. I think you guys are in a strongest position and then I am looking forward to the EPIC data next year.

Thank you.

The next question will come from Michael Higgins of Roth Capital Partners.

Good morning. Thanks. Hi, guys, how are you?

Thanks, Mike.

Good. A question on the aroma of EPIC, can you share with us the percent of kids or percent of patients rather coming in on hydroxyurea, any updates for us?

We know that information. We haven’t yet shared it. One of the things that we said at the outset was that because patients that participated in clinical trials generally have a greater level of concern or involvement in their care. We think that we’re going to see a higher rate than the population as a whole, but we haven’t said exactly what that is. So we think that out there and in the total population, hydroxyurea used is probably 20%, maybe 25%, we seen those kinds of reports. But we intend to do another update, a fulsome update before we announce our final topline data. And you can expect to learn more about patient demographics and some of our blinded data and we would include hydroxyurea percentages at that time because I do know it’s of interest to people.

Yes. I would agree that the higher rate based on these household thus for using and feedback from docs at those centers. Would you mind to you give us an update on EPIC prior to the topline results?

We haven’t determined. There are a lot of good round numbers. Certainly, the R&D day would make sense that we might do it there, but no final decision.

Okay. All right. Okay. Moving on to the stroke study, can you give us more details to the docs, the hospitals, who’s involved, where you got feedback from? What that trial may look like based on their discussions, not necessarily discussions you had with the FDA but just kind of some general outlook? Is this a 50 patient type study? Are you looking for grant funding? Also, were you having plans to list ALI data?

So with respect to the individuals we consult with, we would need to get their permission to share their names. We do have that permission from Michael Chopp and he did a lot of the work. He is one of the individuals who worked with. There are four, five others. These are names that maybe come available as the time goes forward. Sometimes you see individuals like this mentioned in press releases, et cetera, but the only reason I'm not unable to do it is we have not specifically ask for their permission to do so. With respect to the study designs, the only thing that I think that we would be comfortable being saying is that it’s more likely then not that it would be a Phase 2 proof-of-concept study. I think we have an abundance of data exposures and other information that would allow us to jump past Phase 1 study. It’s not a guarantee, right. We have not spoken to the FDA about this program. That would be an important first step. My expectation is that we would be able to go right into a Phase 2. The size of it though is just -- it is simply premature for me to speculate at this time. Obviously, that's going to be driven by assumptions around what vepoloxamer can do in the final design. But yes, we are interested in grants. There are a number of grants that are out there. Certainly, it’s always a competitive and difficult process, but we think we’ve got an exciting asset. One of the things that we heard was that this was an agent that enjoy -- as I described in sickle cell disease as well. It enjoys a number of different properties, each of which could be helpful in the setting of strokes. So, I do think we will be contenders by virtue of being a unique mechanism, compared to a lot of the approaches that have been tied. And then with respect to ALI, all of these studies as you know always start out slowly and then they really get rocking toward the end, because that study was not expected to conclude until the end of 2016. It was relatively early in enrollment. I don't think at this time we would expect to see anything that would be statistically significant or even much of a trend. Our focus would really with respect to data just beyond safety. So we will take a look at that data. I think it’s unlikely to find its way into a publication. It’s a relatively small number of patients and we don't really want to spend capital on the sort of QC and report writing on the study that doesn’t have meaningful utility for us anymore.

Yeah. Great. Okay. Thanks for the update on that. One other question on the really impaired study, as I’ve asked on the other studies that have come up, is this being initiated based on feedback conversations from doctors or anybody in the study or from the FDA or is this something like EPIC-E where along the way you said, no, this will help bolster our label?

Yeah. I can assure you this is 100% elective. We want that NDA to be a very high-quality. Our Vice President of Regulatory, who is new hire for this year came in. We evaluated the pros and cons of conducting the study, and thought, its going to be helpful. So it was not driven by FDA. It’s not driven by signal lot of EPIC. This is 100% elective on behalf of the company.

Okay. Great. Thanks for the update, guys. Congrats and I’ll jump back in the queue.

And this concludes our question-and-answer session. I would like to turn the conference back over to Brian Culley for any closing remarks.

Thank you, Operator. Thank you all again for joining us and please enjoy your days. We appreciate the opportunity share this update with you today.

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