Merrimack Pharmaceuticals, Inc.
Q3 2014 Earnings Call Transcript

Published: 11 Nov 2014

[Operator:]

Good day ladies and gentlemen and welcome to the Merrimack Pharmaceuticals Third Quarter 2014 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we'll conduct a question-and-answer session and instructions will be given at that time. (Operator Instructions) As a reminder, this conference call maybe recorded. I would now like to turn the conference over to Mr. Geoff Grande, Investor Relations. Sir, you may begin.

[Geoff Grande:]

Good morning everyone and thank you for joining us. Today, we'll review our third quarter 2014 financial and provide an update on our clinical progress. A press release detailing this information issued a short while ago can be found in the investor section of our website at www.merrimackpharma.com. This call is being broadcast live and will be archived on our website for six weeks. I'm joined today by Bob Mulroy, our President and CEO and Bill Sullivan, our CFO. We’ll end the formal portion of the call with time for Q&A. Before we begin, I need to remind you that during this call, we will be making forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These may include statements about our future expectations and plans, clinical development timelines, the potential success of our product candidates, and financial projections. These statements involve risks and uncertainties which are described in the risk factors section of our most recent Form 10-Q and the other reports we filed with the SEC, which are available online at sec.gov. While these forward-looking statements represent our views as of today, they should not be relied upon as representing our views in the future. We may update these statements in the future; we are not taking on an obligation to do so. With that, I'll turn the call over to Bob.

[Bob Mulroy:]

Thank you, Geoff and good morning everyone. It's a pleasure to speak with you today to discuss the progress we've made across our pipeline in the last few months. When we last spoke at the end of the September, we had just announced $970 million partnership with Baxter for the Ex-US rights to MM-398. We are delighted to have partnered with Baxter. The deal with a culmination of a robust process involving 38 companies. We selected Baxter based in our leading brand among oncologist, their global commercial operating expertise and their commitment to make MM-398 a priority. The deal will enable us to achieve a number of significant goals including retaining the US rights to MM-398 and fund our commercial launch, gain their financial support, to drive the development of MM-398 into multiple additional cancer indications, and partnering other company to lever their leading position in the emerging markets, with the future of oncology. As part of the deal, we've received a $100 million upon signing agreement and are eligible to receive $100 million in R&D milestones to support the expansion of MM-398 into multiple indications. We can also receive up to $520 million in regulatory milestones, an additional $250 million in sales milestones. The near term impact on our capital position is significant. Inclusive of the upfront, the R&D support and the designation of $120 million of regulatory milestones tied to the first indication post-gem pancreatic cancer. We are also eligible to receive tiered royalties on the sales of MM-398 in Baxter's territories. To clarify a few questions, we received about the transaction. The upfront $100 million in independent from $100 million in R&D milestones that we are eligible to receive. The R&D milestones will specifically be used to fund the expansion of MM-398 into new indications. Now moving to a development update for MM-398, we continue to focus our completing and submitting the new drug application for MM-398 in the United States. Our continuing discussions with the FDA have been very productive and the FDA has provided helpful guidance that we are now, incorporating into our submission. Most of the FDA's guidance has been consistent with our expectations. One recommendation from the FDA, they have made, will however impact the timing of our submission. And the Chemistry Manufacturing Controls or CMC section as it's known of our new drug application. The FDA has requested that we enhance an existing analytic assay for liposome product quality using a refined release specification. We've considered the FDA's guidance and have decided to reconfigure the assay to meet their recommendation. We believe, the improved assay will benefit the future expansion of our commercial manufacturing capabilities. Our CMC team has already developed the assay and is now working to validate, this new method. The additional work required to deliver the fully validated assay is part of our full submission to push the completion of our NDA for MM-398 out beyond year end. We are therefore revising guidance for submission of the NDA to late Q1, early Q2. We continue to be confident that we will be submitting a comprehensive package based on strong data for the NAPOLI-1 study. In other development news for MM-398, last week we announced the initiation of an investigator sponsored Phase 1 trial for MM-398 in the current high grade glioma, an aggressive type of brain cancer. High grade gliomas are the most common form of brain cancers in adults and approximately 15,000 new cases are diagnosed in the US each year. These patients have limited treatment options and often face a very poor prognosis. The study is been run by and conducted at the University of California, San Francisco and will enroll up to 36 patients. This study was designed following an encouraging veterinary study of canine diagnosed with spontaneous brain tumors, where MM-398 was shown to extend quality of life and survival. In terms of the upcoming milestones for MM-398 we anticipate presenting updated data for the NAPOLI-1 trial at ASCO GI in January, 2015. The data will include per protocol patient response data from the NAPOLI-1 study among other data. Across the rest of our pipeline, the last few months have also been productive. In August, we initiated a Phase 2 trial for MM-302 our HER2 targeted nanoliposomal encapsulation of irinotecan in metastatic breast cancer. The HER2 targeting aspect of MM-302 is designed to direct the payload of doxorubicin into HER2-overexpressing cancer cells. And based on our preclinical studies, the nanoliposomal encapsulation is engineered to protect other cells especially cardiac myocytes from the harmful effect of free doxorubicin. Importantly, this study is potentially a pivotal study design to support its application for accelerated approval of MM-302. The trial called HERMIONE is a multicenter randomized study of MM-302 and patients with HER2 positively locally advanced in metastatic breast cancer. It will compare MM-302 plus trastuzumab versus chemotherapy of physician's choice plus pertuzumab and patients who have experience disease progression and who have previously treated pertuzumab and T-DM1. Our investigators are excited about this trial because it provides unique HER2 directed chemotherapeutic option, once patients ultimately progress on T-DM1 and pertuzumab. The trial design to enroll 250 patients and we will be providing guidance and when we expect top line data, once we have enough enrollment to provide a confident projection. For MM-121 our monoclonal antibody targeting ErbB3. In September, we presented an updated cut of data from our Phase 2 trials of breast cancer, ovarian, and lung cancer at ESMO. Additional biomarker data from the breast trial were presented, which further strengthened the resulting data presented at ASCO earlier this year. It has the ratio for the progression free survival for biomarker positive patients in all three trials were between 0.2 and 0.4, while their p-values were all below 0.0008. These results were seen across all three indications and met three different standard of care therapies. We are in the midst of preparing the next development steps for MM-121, while simultaneously pursuing discussions to gain a new partner. Our partnering discussions have been making steady progress. We continue to be pleased with a significant interest in the program and the alignment among potential partners on a very significant opportunity of identify and treating drug resistance with MM-121. Moving on to MM-141, last week we announced that the FDA granted MM-141 orphan drug status for the treatment of the pancreatic cancer. MM-141 is exciting new molecule that is design to block an important tumor growth and resistance pathway, by targeting IGF-1R and ErbB3 simultaneously. We are preparing to launch a Phase 2 study testing MM-141 and front line pancreatic cancer in 2015. Finally, we will be hosting an Analyst Day on December 18. Please note that this is been rescheduled for November 13, due to scheduling conflicts. We look forward to reviewing the development path and commercial opportunities for MM-398, MM-302 and our ErbB3 franchise in greater detail at the event. So to recap our upcoming milestones, we will provide updated data from NAPOLI-1 trial for MM-398 and ASCO GI in January, 2015. We expect to complete the submission of the NDA for MM-398 for post-gemcitabine pancreatic cancer in late Q1 and early Q2. We anticipate top line data for our Phase 2 MM-111 trial and HER2 positive gastric cancer for 2015. As well as to plan the initiation of our Phase 2 study for MM-141 in pancreatic cancer in 2015. Now let me turn the call over to Bill Sullivan, our CFO to discuss our Q3 financials.

[Bill Sullivan:]

Thanks, Bob and good afternoon to everyone. Our third quarter 2014 financials were included in our press release, which was distributed earlier this afternoon. Net loss for the third quarter, 2014 was $28 million and consisted $28 million revenue, $51.7 million in operating expenses and $4.3 million in net loss from other expenses. The $28 million in revenue primarily consisted of $3 million in and then $121 million R&D reimbursement revenues and $25 million of deferred revenue amortization on our MM-121 collaboration with Sanofi. Please note, we expect MM-121 deferred revenue amortization will be approximately $21.2 million in the fourth quarter of 2014. After the termination of our MM-121 collaboration, which we estimate will be on December 17, 2014 amortization revenue will be zero, thereafter. Please note in Q3, Merrimack did not recognize revenue under the Baxter agreement. Moving forward, we will recognize revenue for the upfront payment, cost reimbursement and certain R&D milestone payments received from Baxter on a proportional performance basis and services are provided related to the deliverable identified within the contract. Based on this methodology, we expect to recognize $47.5 million over the next year, which is been classified as current deferred revenue on our balance sheet. Moving onto operating expenses, $43.6 million, 84% of operating expenses consisted of research and development expenses, of this, $19.1 million or 44% relates to expenses in our six clinical stage programs. $10.9 million or 25% relates to pre-clinical discovery efforts and $12 million or 28% relates to non-recurring expenses as a result of our amended PharmaEngine agreement, of which $7 million was paid in the third quarter and we anticipate paying the remaining $5 million in the first half of 2015. $8.1 million or 16% of operating expenses, consisted of general and administrative expenses, which included cost related to commercialization efforts for MM-398. The $4.3 million in net loss from other expenses primarily relates to $4.6 million of interest expense from Merrimack's term loan with Hercules and convertible senior notes issued in July 2013. Approximately $2 million of this interest expense imputed non-cash expense, primarily related to convertible feature of the senior notes. Turning to our balance sheet, cash and cash equivalence available for sale securities increased $60.9 million from the second quarter to the third quarter of 2014. In September 2014, Merrimack entered into the agreement with Baxter resulting of proceeds of approximately $100 million. Also in September 2014, Merrimack made a one-time $7 million milestone payment to PharmaEngine. After adjusting for these large non-recurring items, the decrease in cash and cash equivalence is available for sales securities with $32.1 million for the third quarter. As far as our financial guidance, Merrimack expects existing unrestricted cash and cash equivalence and available for sale securities as of September 30, 2014 of $153.7 million and anticipated cost sharing reimbursements from Baxter to be sufficient to fund operations into the second half of 2015. Please note that this forecast does not include any Baxter milestones, any inflow from additional business development, which remains a priority of Merrimack, nor any revenues from MM-398. Any inflows from any of the above, would extend our cash run way. At this point, I will turn it back over to Geoff.

[Geoff Grande:]

Thank you, Bill. A brief mention that we will be presenting at the Jefferies Global Healthcare Conference in London on November 20, in the Oppenheimer Healthcare Conference in New York in December 10, will also be attending the Brean Capital Life Sciences Summit in New York on November 24, and the Guggenheim Healthcare Day in Boston on December 16. Finally as we mention, we will be hosting an Analyst Day in December 18, in New York. Hope to see you, at one of these events. With that, we'd like to open for line to questions.

[Operator:]

(Operator Instructions) Your first question comes from Brett Holley from Guggenheim Securities. Your line is open, please go ahead.

[Brett Holley:]

I guess the first question, that I have is I guess just a kind of general question about the risk you see to potential new timeline for filing for MM-398, usually when CMC kind of issue come up, things can be a little bit more complicated. I'm just wondering, what gives you confidence in the new timeline, just given the information you have at hand?

[Bob Mulroy:]

Hi Brett, this is Bob. Thanks for the question. So I think, what gives us confidence is number one, that the FDA's request on the assay in no way related to our clinical data or our ability to manufacture the product; and secondly, that the specific assay in question is a measure of quality that, our manufacturing process already meets, that the request is really simply to raise the specifications on the assay. So our product meets the specifications, with respect to our confidence on the timeline. We have already developed this assay and tested it, too sure it's robustness and so, the portion of development that we are involved in now, is really the back end of creating all the paperwork and validation work to put this in place, across our manufacturing process. So that the risk of developing the assay is behind us and we're just really in the administrative portion of this. So we feel that there really isn't any substantial risk to further delay on our submissions and that, in all of our conversations with the FDA. This is really the one issue that was going to impact our development and so we feel very good about the timeline going forward.

[Brett Holley:]

Okay, so and just so I understand. You've already developed the assay and you already tested the assay and you have what you believe, were adequate results and these results would be acceptable to the FDA already in hand, is that correct?

[Bob Mulroy:]

That's correct and so you know the validation process is actually a more significant process around developing all the paper work that supports the assay and the standard processes that you run it through, the SOPs, all the work that goes into the back end assuring it's a GMP CMC quality process. So we have the assay, we have the results to know it, it's effective and it's a robust assay. So we are really on the back end portion of just putting it in place.

[Brett Holley:]

Okay and then, I guess my last question is on, MM-302 and your confidence in the accelerated approval pathway given the number of HER2 therapies that are available for HER2 file served breast cancer. I'm just wondering, if you have a little bit more color on that?

[Bob Mulroy:]

Sure. So specifically, we are advancing MM-302 to treat patients who have been on the existing HER2 agents and have progressed on them. So trastuzumab, pertuzumab and T-DM1. So this is, a third line option and looking at treatment regimens or treatments methods that are out there today in the world, there really is no standard of care for third line patients, who are HER2 positive and while the first two lines have been very successful. We have a situation, which patients are progressing off the T-DM1, of which they ultimately do and there really is no great option. So a, there is a large patient population 8,000 patients in the US who will be coming off T-DM1 and needing therapy and, two there is no standard of care great option for them. So we think it's a great opportunity, to get MM-302 introduced to where there is a real medical need, and secondly it's a really strategic place to get MM-302 introduced and that there is a trial underway combining pertuzumab and T-DM1 as a potential first line therapy and so as agent that as to be designing MM-302 for patients who progressed on those, if that trial is successful and that becomes the first line therapy MM-302 will be a viable option for patients in the second line. So in effect, the agents is considering the various HER2 agents that are in play today. it's – we're seeking it, in place as a first pass, as a following agents to those therapies and we're pretty comfortable given the data we've seen to-date, where we saw progression free survival and anthracycline-naïve patients that 11 months and better versus what is generally seen in practice of 3 months to 3.5 months. So we are comfortable that we have, something that couldn't really provide a big benefit there and could meet its endpoints and qualify for accelerated approval.

[Brett Holley:]

Okay, thanks very much. Bob, appreciated.

[Operator:]

And our next question comes from Yigal Nochomovitz from Oppenheimer. Your line is open, please go ahead.

[Yigal Nochomovitz:]

Just given the bit of the delay in the NDA. I'm just wondering, if that changes in anyway your plans on the sales force build out and commercialization efforts. Are those pretty much moving along as you originally had drawn up? Thanks

[Bob Mulroy:]

Yigal, this is Bob again and thanks for the question. So we continue to make steady progress on building our commercial force. I think that the delay in the completion of the NDA will likely mean a delay of couple months or three months or so for a launch, but so we will continue to stage our investment relative to that process, but to-date we've made very steady progress in building the commercial team, building out the commercial infrastructure to be prepared to act on MM-398 once we get the go ahead.

[Yigal Nochomovitz:]

Okay, got it and what sort of details could we expect and the Analyst Day. I though, I remember you guys saying last time that we might see or you might tell us some more details about the commercialization plans for MM-398 at the analyst event, is that something, we should -- going to be on the docket for that?

[Bob Mulroy:]

That's correct and so I think, what we plan to do at the Analyst Day is really cover three important things is, one, what is our commercial launch plan for MM-398 and based on our primary research into the post-gem treatment scenario in pancreatic cancer, what do we see at the opportunity in some pretty risk detail based on our research there and then; number two, talking about the development plans for MM-398 in terms of with our new partner on board, whenever we expect to develop MM-398 in a specific opportunities, we see for that in the future. Secondly, we plan to talk a lot about our plan for MM-121. We've been busy since getting the asset back from Sanofi. This summer developing plans for how to move that forward into registration studies. So we expect to cover our plan for that as well as specifically, what we see is the opportunity for MM-121 especially vis-à-vis the competition for ErbB3, which is pretty significant in this day and age, and how we hope to still be first market and capitalize on what we think, is one of the larger opportunities in Oncology. And third, we are going to touch on just the rest of the pipeline, in terms of what we think the commercial opportunities are for those products and our past for registration for all those, just to get some clarity out there in terms of what we think the overall opportunity is for Merrimack, coming up in the future.

[Yigal Nochomovitz:]

Okay, thanks and then just one final question. I'm assuming the answer to this is no, but just in your discussion with Baxter for their submissions Ex-US I just want to confirm that you know the delay with the NDA here isn't going to impact their timeline at all in their submissions?

[Bob Mulroy:]

You know it should not, their timelines are going to be unchanged by this. We will be able to provide them with all the base material, the base files they need on the timeline that we had originally planned with them. So we are hopeful that their registration effort will continue as planned.

[Yigal Nochomovitz:]

Great. Thanks.

[Operator:]

Thank you. Our next question comes from Eric Schmidt from Cowen and Company. Your line is open, please go ahead.

[Eric Schmidt:]

Thanks for the overview and taking my question. Maybe another one on MM-398. I assume there is nothing in the product specification, changes or quality, description that changes the way you're thinking about the Phase III data or you know that the quality the drug was used in the trial, itself?

[Bob Mulroy:]

Absolutely not, Eric. So one again, so the request from the FDA is not related to the trial data, it's not related to the product or its overall quality. It's related to a spec that we set on assay for release and it's a spec that our existing manufacturing process already meets. And so, there really is no larger implication for our overall clinical filing or our manufacturing filing and our view of taking on the FDA's recommendation for changing this spec. Is that we think in the long-term it really creates a more robust, process, validation step that, we think will help us in the future, as we expand and increase a manufacturing capacity.

[Eric Schmidt:]

Okay and then on the path forward at the FDA. Do you expect priority review and have you been told whether not you might go to Nodac [ph] panel, it sounds like you've had some FDA back and forth, since the last update?

[Bob Mulroy:]

Yes, so our FDA conversations have continued and they've been very productive. We certainly intend to apply for priority review and we will be hopeful to receive it, you never guarantee it anything until you have it, but certainly the history of pancreatic cancer has been one in which, it is been a field and an area, where priority review is generally been granted in the past and given that, our overall results, our hazard ratio is an improvement over the gem Abrax data. The overall, month improvement is comparable or slightly better in the later line patient population and were indication, where there has been a new agent approved for post-gem pancreatic cancer since the category existed. We feel like, the impetus is there for it and opportunity to be granted prior review, but again until we have granted it, we are never sure.

[Eric Schmidt:]

Okay and then last question on MM-121 and the partnership interest. I guess, I'm just trying to get your latest thoughts on the timing of potentially starting a pivotal study relative to bringing a partnership over the go line, whether one has to proceed the other and relative to MM-398, where you obviously had a lot of partnership interest, would you characterize the MM-121 discussions as competitive?

[Bob Mulroy:]

Sure, so let me touch on the back end. I would certainly review the conversations we're having on MM-121 is robust. And I think, as you go all the way back to our phone call this summer, when we announced that we will be getting the drug back. I think, one of the major things we said in that call was a really certain, but now that we've initiated and now it's been really I'd say very positive not only the breadth of interest, but the degree of interest is been exceptionally high and so that's been very positive. So we look forward to updating you on that, I think with respect to the timing related to the start of additional studies. I think it's certainly a preference to initiate the new program with the partner on board, but one thing that I would say, is that we're very, very enthusiastic about MM-121 that our science from the beginning design MM-121 to treat heregulin-driven resistance and we believe, that the Phase 2 program, really confirmed our belief in that hypothesis and furthermore, confirmed our belief that this is a really, really significant medical need in the world, where between 40% and 55% of all breast, lung and ovarian patients that we tested, were positive for the biomarkers. So with a very sizable population of patients, who are not responding to any other available therapies, we think it's a big medical need and a big opportunity. So what we are doing, we are planning to go forward with this, we are getting everything in place, the product supply, the commercial assays, to drive a registration program, while we are also looking at potential partners and the ideal scenario is that, they all come together in one step, but I think that we'll be prepared to potentially move forward, if we need to at some point in the future.

[Eric Schmidt:]

Great, will look forward to hearing more in December.

[Operator:]

Thank you. (Operator Instructions) our next person in queue. Daniel Brims from Cantor. Your line is open, please go ahead.

[Daniel Brims:]

Just few quick questions. First with the MM-141 study in first line pancreatic, would you be using a that in conjunction with the MM-398 base regimen or probably move it into like in conjunction with gem Abraxane?

[Bob Mulroy:]

Hi, Daniel this is Bob, again. So thanks for the question, so our plans with MM-141 are initially the Phase 2 that we plan to launch next year. We will put MM-141 on top of the existing standard of care, which is a gem Abraxane regimen. Our reason for doing that, is that really that is the fastest path that proves it concept to enrolled patients in the study and validate, what we believe is a significant opportunity for MM-141. The trial will also be done in a stratify way, where we will only be treating patients, who are positive for biomarker profile for MM-141, which we believe represents half the patients in frontline pancreatic cancer. it would be our intent that subsequent to that study to initiate an effort to combine it with MM-398 where we think, the long-term opportunity for best possible outcome exist, but we think the right step for the development of MM-141 at this point, is to go on top of the existing standard of care, demonstrate a strong proof of principle and then continue to development with MM-398 at a subsequent date.

[Daniel Brims:]

Thank you and just a quick question on, I guess MM-121. When you got it back, you mentioned you're going to be having discussions with the FDA about the path forward. So I'm assuming, since you're going to be talking about it Analyst Day in December that you've had positive feedback from the FDA about the previous Phase 2 studies and the potential to move that forward into a Phase 3?

[Bob Mulroy:]

So, when we got the drug back. We did initiate a set of conversation with the FDA on opportunities to move MM-121 forward and that's been the basis of the development of the plan, that we are acting on now and we hope to share more of that plan and the specific indications and trial opportunities with you in December.

[Daniel Brims:]

Okay, thank you.

[Operator:]

Thank you. Our next question comes from Eric Criscuolo from Mizuho. Your line is open, please go ahead.

[Eric Criscuolo:]

Just pulling up for Peter, tonight. Just on the Analyst Day, well would we or can we expect maybe to get an update on the early settings for MM-310 and MM-131?

[Bob Mulroy:]

Eric, this is Bob again. So I think MM-131, which we haven't talked about much in these calls, is a program that we will be talking about at an upcoming EORTC meeting in terms of presenting the product for the first time. It's a product that we are very excited about. I think the focus of our commercial day will be clearly on the later stage programs. So I think, while we may touch on for a few minutes, just what on MM-131 is and what our initial Phase 1 development maybe, I wouldn't expect a focus on that program, at tech commercial day. With respect to MM-310, we haven't released the details on that program yet and we expect to be talking about that more significantly during 2015.

[Eric Criscuolo:]

Okay, thanks for clarifying that and MM-398. The Glioma trial that was just started. Can we maybe see, a relatively fast read out on that and maybe see some kind of data in the first half of 2015 or is that just not possible?

[Bob Mulroy:]

So I think, with respect to the study, number one; it's one that we are pretty excited about. It's taking an advantage of the technology component of MM-398 which allows essentially through a very, very stable particle a slow release of drug overtime. So that the direct injection of the drug into the brain could have a half-life of well over a week, release drug and doing much better than standard chemotherapy both in accumulation and in duration of exposure. Two, the study is being run as an independent sponsor study by the investigators at UCF and as such, we are not engaged with the actual recruitment process of patients or the enrollment process and so that the timing of the study really will be driven by the folks on the ground at UCF. We will be support them as much as we can and are very enthusiasm about their effort, but the folks at UCF will be the ones who will be reporting out data in timeline. So we will be monitoring that progress like anyone else.

[Eric Criscuolo:]

Okay, got you and just lastly on the new asset at the FDA is asking you to run for the MM-398. Has that been an industry standard for a while is that a brand new asset that they have, can you just kind of describe, what were it kind of fits in the paradigm right now of manufacturing?

[Bob Mulroy:]

Sure. So the first is, what we are doing, it's not a new assay. We have an existing assay and we've been asked to increase the release specification for it. So it's an assay we have, we've increased the release specification. We are now doing the validation work to put it into our GMP process. With respect to the history on it. We are dealing with an emerging and evolving field of nanoparticles and so we happen to be at the leading edge. So very important to any product discussion with the FDA is sitting down and looking at the very specific nature of each program, in each product, which we did in this case and we have developed and assay, that we believe was sufficient going into the conversations based on our understanding of the field, and they were able to supply some guidance and advice, that we actually think was very helpful regarding the future opportunity to demonstrate quality as the process scales. And so we agree with their advice to increase the specifications on the product assay release and so are doing so, but it's an assay we had, it is an assay that is new relative to this field of technology and it is one that the specifications emerge from a joint conversation with the FDA about what the right assay specification should be, but our sense is that our work with someone this will likely create the standard moving forward, for other nanoparticle drugs.

[Eric Criscuolo:]

Thank you very much.

[Operator:]

Thank you and this concludes our question-and-answer session for today. We would now like to hand the conference back over to Mr. Geoff Grande for closing remarks.

[Geoff Grande:]

Great, well thank you everyone for joining us. We look forward to talking to you again, soon.

[Operator:]

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