VolitionRx Limited (VNRX) on Q1 2021 Results - Earnings Call Transcript
Operator: Good morning, ladies and gentlemen. Thank you for standing by. Welcome to VolitionRx Limited First Quarter 2021 Earnings Conference Call. During today’s presentation, all parties will be in a listen-only mode. Following the presentation, the conference call will be opened for questions. This conference is being recorded today, May 12, 2021. I would now like to turn the conference call over to Mr. Scott Powell, Executive Vice President of Investor Relations. Please go ahead.
Scott Powell: Thank you, and welcome everyone to today’s earnings conference call for VolitionRx Limited. This call will cover Volition’s financial and operating results for the first quarter of 2021, along with a discussion of our recent activities and key upcoming milestones. Following our prepared remarks, we will open the conference call to a question-and-answer session.
Cameron Reynolds: Thank you, everyone, for joining Volition’s conference call today. I especially appreciate it, given the busy earnings call season and speaking of busy wow, we have had quite a start to the year and made excellent progress in developing a range of products based on our proprietary Nu.Q platform. I expect that we will have a lot of news throughout the remainder of this year on additional product developments worldwide. I will be updating you today on our products, people, patents, publications and most importantly, progress within all four key pillars, Nu.Q cancer, Nu.Q vet, Nu.Q nets and Nu.Q capture. But to start off, I will quickly hand over to Terig for the financial report.
Terig Hughes: Thanks very much, Cameron, and thank you everyone for joining our call today. I will now provide a summary of the key financial results for the quarter ended March 31, 2021. During the 2021 quarter, we reported a net loss of $6.1 million as compared to a net loss of $5.9 million in the same period last year. This result reflected research and development expenditure of $3.9 million, which was in line with last year. General and administrative expenses of $1.8 million, approximately $100,000 higher than last year and sales and marketing expenditures of $0.4 million approximately $150,000 higher than last year. The slight increase in operating expenses during the first quarter of 2021 was primarily driven by our ongoing transition to a commercial organization.
Cameron Reynolds: Thanks, Terig. I’m delighted to have the strongest balance sheet we have ever had combined with the expectation of significant revenue growth throughout 2021. It is great to have you on board. In fact, while we are talking about new team members, I will kick off with a people update, which as of late has mainly been focused on broadening the team with top talent to assist with commercialization of our Nu.Q platform.
Operator: Your first question comes from the line of Kyle Mikson with Cantor Fitzgerald.
Kyle Mikson: So I was wondering if you could talk about how the first nematocysts products can be launched and what the go-to-market strategy is. Specifically was wondering what the most likely use for the first assays are going to be I get? I understand that it is probably from monitoring, but just like which disease I was kind of thinking. And when you say launching the product on multiple platforms, do you mean allies or beads when you say that or do you mean like, the actual amino assays analyzer like the ? And then on the go-to-market plan, is there going to be like a beta launch in Europe and then like a broader launch later? Or how should we think about that? Thank you.
Cameron Reynolds: Thank you, Kyle, and thanks for your questions. I will answer them more than make sure if I forget one of them, please return. So which disease so a couple of quarters ago, we thought perhaps under NETosis/influenza, sorry, for COVID in an influenza might be the way to go. But I think given the waxing and waning of NETosis from COVID, I think perhaps sepsis might be the one which is easiest to get the traction in. Certainly the easiest way to get large numbers in a trial because obviously, as I’m sure everyone’s aware, it is even during the pandemic, there is the biggest killer in hospitals. So it is obviously a very, very big problem and therefore much smoother ride to get the numbers needed for trial. When we say multiple platforms that is a good question. So we launched the vet on plates, and initially where we are now. As you can hear, we have been working a lot on getting it on the machines. We are using IDSs as machine but we have also explored different machines, we can use it on the larger auto analyzer machines. And we are also producing the beads at large scale now so we can absolutely launch things depending on what machines are available but on bead based machines, and adapting to a new machine seems to have taken just a few months ago. There is obviously new regulatory work but the actual adaptation is quite easy. But we have also mentioned we have also working a lot on a point of care both lateral flow small machine. We have actually, Dr. Eccleston, who is in his new role, as technology has been looking at a lot of different options for just simple yes, no lateral flows, quantitative point of care, and also the small machines. I won’t mention the companies but because of confidentiality, but we are talking to quite a few. And we actually have our essays out to a quite a few different companies. So for small point of care machines, as well as lateral flow. So it is what we aim to do with everything. I think, as I think it is clear, what we believe is this is going to be potentially huge in a very wide range of areas. So rather than saying to a customer, or a government or someone, it has to be on beads, or this machine, or this point of care, we aim to offer a full menu. So I guess they say, courses for courses, sometimes plates are easier, particularly for research. The machines are very easy, if you want a high throughput. The RDS machine, for example, can do 500 samples a day on a quite a small machine. We are hoping in the future to license to groups like the big auto analyze the companies, there is about half a dozen of them at Roche, Siemens and then developed a point of care. And that is quite developed to the point of care as well. So the go to market strategy. That is a very good question. And I think, as you have probably created, from what I said, we have been very, very happy with the results. In the diagnostic power, increasing diagnostic power, patient selection, also monitoring disease progression. Also, we are trying to show some prognostic value as well, from the assays, which I think we may get to. So the go-to-market, I guess like every way you are looking at different regions. The EU, to get a CE mark could actually be reasonably quick, because the platform we have CE mark very similar assays before, and then we aim to see mark them on beads quite quickly. So once we have the chosen intensive use, and it could be one of a few of those things. And the samples run, it is just a couple of months process to finish off the CE mark. So what is caused us some time has been finding the right population to get a CE mark trial in. But if, as you mentioned, at which indication, sepsis can be reasonably quick, because there are many, it is everywhere, as you know. And that is year round, summer, winter, and in every hospital in the world. So I hope that answers all your questions, how does that matter? And the U.S., there is some talk of trying to get emergency use, which of course we try for the COVID. But I don’t know, I think it is certainly less than 50/50, we would get that so it would be normal. The process we look to go through in a range of areas is to go to a CRO collect for a 510 (k) and then go for it go through that path which Dr. Terrell has done quite a bit of work from in a range of areas. So the cost of that is a few million dollars typically. We tend to look at two or $3 million and it usually takes up 12-months, 18-months for collection, plus all the regulatory timing from whenever we start the process, which we are working on now, but we don’t have a timeline from when we expect to start. I guess that will be driven from the data we have got coming up in the next few months. We have our assays in the hands of a bunch, like five or six different groups now who were using them in their own trials to show the efficacy as proof of concept. So that is all coming together really well. Does that answer your question?
Kyle Mikson: Thanks Cam. That was perfect. I threw a lot at you. But you did a great job answering. Thanks again. And I just want to take the Nu.Q Capture great publication with mass spec data, but when you think about like commercialization looks like a product could be out by 2022, which is positive. But, when you when you think about, like submitting for regulatory approval, how quickly could that FDA or see more kind of occurred? And if it is going down the pathway, would that be a PMA IBD, because it is a screening test, it seems. And then I’m also wondering, like longer term, would partnerships with companies that are offered that instrumentation like mass spec or next gen sequencers. Would those partnerships makes sense to kind of couple the assets with?
Cameron Reynolds: Yes, absolutely. So we are obviously not in the sequencing nor mass spectrometry space. So I think the Nu.Q capture from and thank you, yes, the paper was fantastic. Nice, great to be in nature scientific reports, it was a real breakthrough shows that it is reproducible and robust to like the rest of our platform. So commercialization, of course anything which is going to be next year would not be an FDA study, it would be sold as a service for others to help them I think there is a lot of different ways by capturing and concentrating the crumbs and fragments, we can help a range of different groups. And I will my team can go through that with greater detail. But anything which is sorry, obviously, selection of monitoring as part of a trial would take many years. That is certainly not going to be next year. But I think given what we are doing, like with Nu.Q discovery, it is looking very good in a range of different areas for capture, and it would be selling and as a service. And would we work with big companies? Absolutely. So I guess there is one very well known, big sequencing company, and there is quite a few big companies in the liquid biopsy space. And I think, like everything, we would look to launch our own products to show it works to really get the ball rolling, like we have invested. But we are very, very interested in licensing, particularly in capture, because it would be something we believe if it all works well could be incredibly useful to them. So it is not something we have to commercialize ourselves. So I think once we have got the very good proof of concept from the next level, if that happens, we would quite aggressively look to license it out.
Kyle Mikson: That makes sense. It doesn’t have to be an approved assay. And then just thinking about the body’s natural studies looks like the collections have been played a bit, which makes sense due to COVID. And I know there is going to be an updated timeline provided when it is ready. But is there any detail that you could share to help us understand why the studies were delayed? And I’m sure you know, mostly it was due to COVID? How significantly could that delay the first 510(k) submission for DLBC, because we talked about the timelines in the past and just wondering how far was there now pushed out to 10-Q?
Cameron Reynolds: Yes, that is a very good question. And I don’t have the firm timelines, and I don’t know, updates and have to re update, but it is tough updating in the moment with COVID going. That is the primary reason was what you said. And as I’m sure you were, it is been a tough 15-months to be collecting trials in the U.S. for cancer. So an EDRN study is still paused. I don’t want to half answer that question. Because we are not I don’t think anyone really knows exactly what is happening at the moment with collections. And so we are doing as much as we can to really work out the new timescale and how much it is delayed. But I would strongly expect it is going to be at least a quarter or two, given everything. So that is just speculative at the moment, and we are looking at ways perhaps we can get things back on track time wise. But as I said, yes, it is just been a really tough time. The last 15-months with the pandemic to keep collections on track in the U.S., but we will have a full update as soon as we know and I strongly expect that is going to be before at the next cue.
Kyle Mikson: Alright, that is understandable, and it is very fair. I just had one last question. I think it is going to be quick. On the biomedical distribution, I just want to confirm are those for the or my is overwhelming. So just want to make sure I’m thinking about that correctly?
Cameron Reynolds: I don’t know that is where the Nu.Q first, which was, we got this kit CE mark, for the blood cancers in Europe. As you are seeing the dogs, it works very well on the blood cancers, and they are looking to see if they can get some traction in Eastern Europe. And as that is not one of our key markets, I don’t quite a large companies as you know. This is both sides just kind of feeling each other out, if you will see, what if they can find a market in Eastern Europe and if we like working with them, so they have gotten to the end of the year to see if they think they can make a go of it in Eastern Europe, given the data they have or collect more data. So we are getting a lot of interest from different groups just kind of trying to work out how they can be involved is Nu.Q going to be, I think and as they are a very good company, and quite an established company. And it is a footprint where we didn’t really have any traction in Eastern Europe, we thought it was a good thing to do. And there is a lot of these smaller deals bubbling as well as the bigger deals we talked about. As we sort of work out ourselves, and they work out how the patchwork is going to work in all our different products. So it was good to get this first one, the first run on the board, if you will. And we will see how that goes between now and the end of the year and see if we want to continue the relationship and they do but it is a good start.
Operator: Your next question comes from the line of Bruce Jackson with Benchmark Company.
Bruce Jackson: Hi, I would like to ask you a couple of questions about the NETosis assays. So you have got the one COVID-19 study where you have been collecting these material samples? Have you submitted that data yet for a pre-conference? And if so, which conference, would it be presented at?
Cameron Reynolds: Yes. So we have gotten a couple of different paths, we tried to do a big sort of study. And that is been very tough to get off the ground, because everyone quite naturally is concerned with getting their sick well, in the emergency wards. So collecting serial samples and not a complicated trial. But it is obviously something which takes a lot of attention away from, a lot of them have been obviously extremely busy, especially in London in the last few months. So we have been working with, through a few different networks, they have been incredibly good people in the COVID. And so space. I guess the hospitals, we talked about a bit, but very, very large hospitals, the best ones in London and some of the best in the world for COVID work. They have submitted to conferences, I believe the next one, they tend to be two or three months ahead. That is the only problem with when you do it like this. They do it through publication, which is good. I mean, it means they are very happy with the data. And they are very comfortable, but just takes a little more time to conferences don’t happen the next week from when the data comes out. But the next one is July. And we have, as I said a bunch more out there. So I would see a steady stream of them coming through the rest of this year, both in the pig animal model for sepsis therapy and the human model also in sepsis, also in COVID. And I can’t give you the details now. But there is several other areas of NETosis where we have been very active in supporting groups who have research going in that field with providing our assays and our knowledge of NETosis to see how it goes with them. So the first one is, I guess it is been over a month away. And there is a large range of them coming through the year. And I think we have been extremely encouraged with the work that we have been doing with it with our partners who are world renowned specialists in COVID and sepsis and in emergencies. And we are also attempting to now get the size we needed for studies, which can then become the regulatory work for CE mark, which again, at the studies is the delay, once we have that a CE mark can actually happen quite quickly because our platform is so well developed. It is a matter of small number of months once we have the population at run. And as I discussed with Kyle, particularly with sepsis, you can get large numbers very quickly, summer, winter, rain or shine, there is always sepsis in a hospital. So I couldn’t be more happy or excited with the way it is going our platform. We have been shipping kits to very busy, very independent people. And the feedback we have got has been nothing short of excellent in every case, not only in the quality of our assay, but how well it is at doing different things with regard to the NETosis. And as I said, not just the diagnostic, but also potentially, as a companion diagnostic or even patient selection for treatments for clearing out of nets. So potentially a really, really big market and something we are very excited about. And there will be a lot of data through the year. Does that answer your question Bruce?
Bruce Jackson: Yes, if I could follow-up the sepsis application. So do you also have data in-house for that, for that use of the assay? And has it been submitted for presentation?
Cameron Reynolds: Yes. And lots more to come. So it is a bit of a presentation. So the data we have, we have a lot, we haven’t published, we are working on through now with them. And things have been published, as well as don’t forget, it was published in the pig model on the therapy. And I think from, as you can see from the poster RFA was an extremely good marker for the disease progression also, and worked incredibly robustly and stabling. And we are also that this was all on a plate system, obviously, you probably want more things faster, and in a very situation than just every six hours. So that is quite fast. So we are also working, putting the sepsis platform on beads, so it can be done in 45 minutes. And also potentially point of care. So theoretically, you could have almost instantaneous measurement of the next level. And if you think for those who wondering how that is useful, I think, you know, Bruce, if you are in a hospital, sepsis is a big killer, it creeps up on you. And it kills you for two main reasons. One it is very early to diagnose early and really get ahead of, and two the treatments aren’t actually that great for, and there is often a lot of tritton, there aren’t many. So there is no good diagnostic for it really certainly nothing in real time. And there is no real legal therapy, but that is partly because there is not a good diagnostic. So I think this could be really, really something very, very helpful to a lot of people.
Bruce Jackson: And then with regard to the contract research business from silver one you have been talking to some large companies. Do you have any contracts in hand yet? And this give us a little bit of a flavor for the types of studies that they are, they are contemplating. So are they looking at the Nucleosome IQ testing as something where they are trying to get a handle on it? Or do they have an actual application in mind, for example, is the companion diagnostic?
Cameron Reynolds: A lot of both, but mainly where they have a purpose in mind. A lot of monitoring of efficacy of their therapies in development in cancer in the toeses. Also in the animal space, we have actually worked with a few groups looking to use our assays, obviously, in the dog space as well. But so far as so yes, we have a handful have actually only been quite recently we even started so we have been very happy with the response. We have one sales member manual who has been chasing the tree. And there is turns out looks like there is a steady demand for epigenetic profiling. So yes, it is four particular uses. So as we talked about the revenue, it can be very small, it can be very large depends on where you sit in that continuum typically starts out to be more in the sort of small tens of thousands of dollars. A big quote, over a sort of six month period, could get into seven figures. But so that is the kind of the ballpark you are looking at. But of course, if it becomes part of the 510(k) or FDA study, then you are looking at a much larger amount. But obviously, most things don’t progress to that level. But it is a very good way of getting known, very good way to get more publications, very good way to get to. So it is, yes, I would expect to see, you never know, the contracts, I suppose the discussions might go nowhere. But there is certainly a lot of interest. Some of them are quite well advanced. So I would be surprised if we didn’t close a few of them in the sort of short to medium term. And it is just a good way to get things moving. And I think it is very encouraging to see silver one is now I think there is 12 or 13 different recombinantly presents were producing. We could offer service for I think about 15 different new custom assays. So and potentially, you could capture as a service as well, which could be the revenue next year. So it is and I believe, as far as I know what that service is quite unique in the breadth and abilities of what we can do. And as I’m sure you are well, wherever epigenetics is really taking off, so it could be it could be a very good process for us.
Operator: Your next question comes from line of Jason McCarthy with Maxim Group.
Unidentified Analyst: It is on the line for Jason. So I would like to see if you can kind of give us just a bit of a deeper status update. And walk us through the steps that you need to take for the human diagnostic platforms. We know that the big study in blood cancer has kind of on pause, but what about the other programs like lung cancer and colorectal? Especially now that you have the same like, you got full enrollment on the National Taiwan studies?
Cameron Reynolds: Yes. So I guess the human studies, the London said that the reason we did the blood cancer first is just one assay, or maybe two assays got fantastic results. I mean, look in the bed space, we are high 80s or 90s AUC’s accuracies, which is quite remarkable for a very low cost, easy-to-use blood test. But obviously, in the lung and colorectal space, it is more work, because we have always needed to do a panel. And so you have to get a broader range of assays ready. And also, on a platform, that is not something you would use four or five different plates for. So it would have been very hard to do a beta launch in CRC, just on plates, because you need a wide range of essays. So that is actually we haven’t focused a lot of efforts on the back end of finalizing all because, we only have a relatively small team. The fantastic thing is our optionality now that we can pivot to the Vet space, where again, a very simple essay has got spectacular results, NETosis were very simple couple of assays, which we can launch very quickly and easily. I think if it hadn’t been for the pandemic, we would have spent a lot of time finalizing the platform for a broader range of assays, because to bring each assay to a product stage, obviously takes a lot of background work. It is not incredibly detailed work with a lot of detail. So you have to use, it can take six-months to 12-months per assay. I mean, you can do them concurrently but each one you can take a lot of work to just making sure they are fully robust and reproducible, which of course we have done in the assays which are now ready for products in the vet and the NETosis space. But we still need to go through that. But while they are still collecting and the process particularly, obviously, Taiwan’s not going to be the biggest markets. We are talking to a major player in Asia, I can’t mention the name but if I said it, who they are about assisting us with launching on a more simple platform in Asia, and one particular part of Asia. So we are just trying to work out now and how much effort we put into, because obviously, it is still going to take that that is low friction, that happens, but they are not U.S. regulatory trials. And they are probably not good enough for a country in Asia, they have accepted more proof of concept. But I think given how strongly that has taken off, and that could easily be a very, very large market, and so good to entice us with the platform we have ready, we still have to go through a bit of the background work to really finish off the lung and colorectal. So given the fact that it is paused in the U.S., and I think we would probably focus on getting the blood cancer in humans product out first, because that is very close to product ready, because it is a very simple panel, and to be 100% upfront, we have never got 90% AUC with one assay on local records always taking the panel, which is understandable, it is a solid tumor or liquid tumor, but so we do have to do quite a bit more work. I can run you through more of the details if you want to, after that. We still have more work to do on the background. So but I’m going to colorectal but given the optionality we thought we would go with where the very low hanging fruit is at the moment in the blood cancer and NETosis and the vet space.
Unidentified Analyst: Thank you very much. And then I would like to ask also about the H2 A1 or three histone that you discovered to the capture program. Is that something that you could add to kind of the main line Nu.Q colorectal cancer assay especially while the U.S. EDR and studies on pause?
Cameron Reynolds: Absolutely. So actually, and that is it is not necessarily a bad thing. We have been big on polls, gives us more time to adapt the platform. I mean, getting a colorectal panel is a lot of work. And we can add those assets to it. Absolutely. And we are actually looking for it is been proven very helpful in biomarker discovery. So that one, and that we are certainly looking at others as well. I have never been described as being different. And from the mass spectrometry, it certainly appears they are, so we can 100% add any assay theoretically, and because what we have is a bit of a process now where we can make the recombinant nucleosomes the antibody in-house and make the assay. So the short answer is absolutely. And that is one of the many reasons we are doing the Nu.Q capture program is to also add new biomarkers that have not previously been described.
Unidentified Analyst: Thank you. And then just one more, I would like to ask as it is been around seven months since you have started the beta launch, for Nu.Q Vet, can I talk see if you could talk a bit about, what you have learned so far in the Vet space and how you can take that and kind of apply it to more of the national launch later this year?
Cameron Reynolds: Yes, it is actually we have learned a huge amount. I’m really happy and glad that we did it the way we did. I’m very and learning also comes from the people. Dr. Tom Butera coming on board. He is a very well renowned executive in this space, and leaving Mars which is the biggest Vet company in the world and coming to ours, which I’m guessing we are probably one of the smallest really shows his faith in what we are doing. And he has been tremendously helpful in guiding us in some of these issues. But I can put to give some flavor, there is a huge amount of things to learn. Obviously, one very important factor is pricing. Obviously, we want to maximize the revenue. And so we, I think, on the national launch, we will be adjusting the price and you will see all of that, to really maximize the level. Packaging has been very important, the need to be on ice. Obviously, is a big difference in the amount of work required, if it is frozen, or at two degrees. Also, we have learned it is very good to ship a box to the vet, so they don’t have to limit the amount of work they have to do. Also, a lot of that, also just want to package it up and send it off to a centralized lab, there is two big companies or around the world, several big companies, which do that, if you are doing six other tests, it is sometimes users take an extra box. So I think that will be a big part of it. So we have looked at every single aspect, not the test itself, that is worked incredibly well. But just all those nuances are incredibly important to get right. And I think, as I have discussed, but I couldn’t reiterate enough, that what it is also done is proven that we have a product to the big vet companies and small vet companies. And I think we are in a really good position. Because, as far as we are aware, were there any real product out there that can show any real efficacy in cancer in dogs. And there are several big companies and several insurgents in the business, and there is only one of us. So I think puts us in a really good position. And it is I think it is very fair to say that taking this very seriously, we are in very serious discussions. And I think that is going to be a big part of the mix as well. But that is kind of what we wanted to do all along, I think providing a solution ourselves is a good way to move forward and prove it works and get it all fine tuned. But also, and this is true in the human space, but certainly also in the vet space. The companies have hundreds and hundreds of salespeople and reps worldwide. So I think that is going to be hopefully a big part of our mix as well. So all in all, I think it is been a really good process for us. And it should make a deal much smoother if we end up doing one with one of the majors, and also really smooth launch of our product nationally and internationally. Because we also expect to be launching internationally in Europe and Asia, in the coming quarters as well, because there is obviously a big need there as well.
Operator: Your next question comes from line of at Nathan Weinstein with Agesi Capital.
Nathan Weinstein: I suppose just to start on Nu.Q Vet and Nu.Q Discover kind of as we think about the next few quarters on those programs, should we be sort of thinking about a sequential revenue ramp?
Cameron Reynolds: Well I will do one at a time. So Nu.Q Vet, so the sales, debit ordering, as we talked about each order is enough to do not quite a couple of hundred dogs, but in $46 each. Now 25,000 revenue can work out roughly how many it is in the hundreds. We are not putting a lot more on very much at all marketing in at the moment, because we are answering all these questions. So I don’t expect that to market to go up in the next sort of few months, because we are putting all the effort into the negotiations for our own national launch and also of course, have licensing and the other processes. So there has been good interest, but we are using this much there is no point spending huge marketing budget now. When I think we are going to look nationally launch with all the tweaks that we have been using. Yes, I would expect it to rise but I think the big change will be after the national launch. And I think if we can get a licensing deal that would absolutely supercharge. Because as I said to Michael, the big companies have hundreds and hundreds of sales people worldwide. So it is obviously a whole different potential to be quick. In wrapping up, if that is, that is if that is done as a deal. You can discover, yes, it is going to be a bit lumpy, because I said, some deals can mean as low as $10,000, some couldn’t be over $100,000, or euro. So in one quarter, you might get a couple in the next quarter, you might not but I think through the year, I would expect to see a few. And I would expect that to pick up strongly through next year as well. So and it is, we will provide guidance, as soon as it becomes clear the mixture, how discovers going how Vet going, and potentially licensing deals, we have a potential licensing deal being discussed also in the human space. In Asia, that may or may not happen, but that would also change how things look as well. So the package should become a lot clearer through the year, but I would expect to see a slow steady gains with a Vet and then the big movements would be either on the national or international launches and or on a licensing deal. And discover will pick up I think quite strongly through the next few quarters, but could be lumpy, some quarters could be quite good. And some could be smaller, just because the nature of how it looks in deals. Does that make sense?
Nathan Weinstein: Yes, thank you, Cameron. That is very helpful on the revenue front. And then maybe just thinking about margins, I have always thought of Nu.Q as having a particularly attractive cost of goods. So I just wanted to get your thoughts on those costs, and maybe compare contrast to other testing modalities that are out there and the costs attractive, and then how silver one plays into that in the long-term?
Cameron Reynolds: Yes, it is very interesting, it is in some ways as follows. I obviously have an MBA to study a few of these things. It follows in some ways a kind of a software model in terms of our whole idea in all this is not just to offer a license, but still the key components so that we can maintain quality, also have a good idea of actually how many they are selling. And particularly in developing countries in countries where you might not see a royalty get revenue early on. So at the moment, on the plate based format, it costs around $4 each $5 per test. But sometimes you have to do repeats. So you might have to it might be a few a few of those to get it. Once you on beads, there is no need for a very few repeats. And the cost goes down a lot, maybe even half or less than that. And we are in the process of changing over to beads now for the different platforms. So silver one, so I think it is sort of moving forward, we are seeing in Vet space, obviously, we have a very good margin, and so does everyone in the chain. And I think we are looking to make it a mass market product. I think it is something which particularly is part of the world of screening tests, could easily be something which we target to having several hundreds of thousands or millions of tests per year. And I think perhaps we need to be a slightly lower price point. But given the fact that our cost of goods are going to be dropping a lot, it is probably a very similar margin, we have just a lot more throughput in on the product front. So it is, I think we are in a very unique position because we have something which we can, when the cost of goods as low as ours are and I think it is full production, we could be at just a few dollars, per se, or even less if it is in simple terms. You can kind of put the, we have to recoup obviously the large investment we made in this space, but you can put the product at pretty much any price we have a very attractive margin. And that is we are all about a volume business. So we don’t want to sell a few things at a very high price. We want to really dominate, not just on the plates, but magnetic beads also on the point of care and make it a test. And if we do progress on the step society, it is something which I think could be taken by a very large percentage of people in hospital regularly to check to see if they are starting to develop sepsis, for example. And to do that you can’t be $200 or $300 a test, you would have to be well below $100. I think it is going to be something which is really, really mass market. But then the numbers of tests go up massively. So it is either way, we have a very high margin, I think, but we are really pushing for volume of sales.
Operator: Ladies and gentlemen, we have reached the end of the question-and-answer session. And I would like to turn the call back to Mr. Cameron Reynolds for closing remarks.
Cameron Reynolds: Thank you, everyone. I understand you are all very busy. And I really appreciate your time. And please keep an eye on us over the next few months and quarters and all the way through next year. We have a very strong team I believe, we have a strong balance sheet we have ever had, fantastic platform. But now we absolutely realize it is about making products and getting revenue. So now we have a good commercialization team in place and the first products we are going to be taking that very seriously. So thank you for your time.
Operator: This concludes today’s conference. You may disconnect your lines at this time. Thank you all for your participation.
