Pulse Biosciences, Inc.
Q4 2017 Earnings Call Transcript

Published: 17 Mar 2018

[Operator:]

Good day, ladies and gentlemen, and welcome to the Pulse Biosciences Fourth Quarter 2017 Earnings Conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the conference over to, Brian Dow, Senior Vice President and Chief Financial Officer. Sir, you may begin.

[Brian Dow:]

Thank, you operator, and good afternoon, everyone. Welcome to Pulse Biosciences quarterly investor update call. On the call with me today is Darrin Uecker, Pulse Biosciences’ President and Chief Executive Officer; Bob Duggan, the Chairman of our Board of Directors. Before we begin, I’d like to remind you that on today’s call, we will be making forward-looking statements. These include our plans and expectations relating to our operational, scientific, clinical and financial projections, products including the uses and applications of such products and other future events. You should not place undue reliance on such forward-looking statements, which are subject to a number of assumptions, risks and uncertainties, and may differ materially from actual results. These risks and uncertainties are more fully described in our Securities and Exchange Commission filings, including our recently filed Annual Report on Form 10-K. Pulse Biosciences undertakes no obligation to update forward-looking statements as a result of new information or future events. In addition, please note that today’s call is being recorded and will be available for audio replay on the Investors section of our website at pulsebiosciences.com, shortly after the conclusion of this call. Investors electing to use the audio replay are cautioned that forward-looking statements made on today’s call may differ or change materially after the completion of the live call. I would now like to turn the call over to our President and Chief Executive Officer, Darrin Uecker.

[Darrin Uecker:]

Thanks. Brian. Good afternoon, everyone, and thank you for taking time to join us on today’s investors call. It has been a busy and productive time at Pulse Biosciences since our last call. As you will remember from our last call, during November of last year, we welcomed several new Board members to Pulse Biosciences, including a new Chairman in Bob Duggan. And since then, we’ve been working with Bob and our Board to review and solidify the strategic direction for the Company and outline our near-term and long-term objectives. Bob’s success in life sciences and in particular his recent success along with Board member, Maky Zanganeh in oncology, have added significant strategic value to the Company already. Over the last several months Bob and Maky have been actively engaged with management utilizing their expertise and deep contacts in this space to help ensure we are taking the necessary steps to capitalize on the potential of Nano-Pulse Stimulation for the betterment of patients. On today’s call, we will be recapping the significant progress made during 2017 and the development of our Nano-Pulse Stimulation technology in both preclinical work and clinical studies, noteworthy advancements in our PulseTx Nano-Pulse Stimulation system platform, regulatory efforts along with operating results and financial matters. Afterward, Brian will provide updates on our financial milestones for 2017 and recap our 2017 financial results for the fourth quarter and year ended December 31. We will close with an update on progress we have made in drawing clarity around our forward trajectory for 2018 and beyond. As background for those of you new to Pulse Biosciences and a reminder for those of you who have joined our previous calls. At Pulse Biosciences, we’re developing a proprietary tissue treatment technology, based on Nano-Pulse Stimulation, where ultrafast electrical pulses with nanosecond pulse durations from billions up to a millionth of a second are used to stimulate cellular effects that can lead to positive therapeutic outcomes. A nanosecond pulse is an incredibly fast pulse. To get a sense of the scale, a nanosecond is to a second, what a second is to 31.7 years. Or said another way, if you travel with the speed of light for one second, you would travel over 186,000 miles. If you travel at the speed of light for 1 nanosecond, you would travel just under 1 foot. It’s an incredibly short duration. When these incredibly fast pulses are applied to cells, they have demonstrated a unique ability to enter the cell and disrupt the functions of the intracellular organelles, the smaller operational structures within a cell such as the endoplasmic reticulum, which serves many cellular functions such as the synthesis and transport of proteins, Golgi complex, responsible for processing macromolecule like proteins within a cell, and the mitochondria, often referred to as the cell’s power plant. The disruption of the function of one or more of these cellular organelles can result in the dysfunction of the cell as a whole and initiate programmed cell death or the deliberate death of the cell. We believe it is the ability to initiate programmed cell death through the temporary formation of pores in cell membranes and permanent disruption of the intracellular organelles that differentiates Nano-Pulse Stimulation from other energy-based therapies such as irreversible electroporation or radiofrequency ablation. Immunogenic cell death is a form of programmed cell death by which cells are induced to die in a manner that activates the immune system to both clear the treated tumor cell and enrolling immune system cells, such as cytotoxic T cells to recognize and eliminate cells of the same tumor type. The formation of pores in the organelles causes intracellular release of calcium, which can ultimately lead to programmed cell death. This ability to get inside the cell with a nontoxic application of electrical energy while preserving the integrity of the outer cell membrane is the cornerstone of NPS and we believe will lead to a number of compelling tissue treatment applications, in particular in the treatment of cancer. Our mission at Pulse Biosciences is to build a viable company that designs, produces and commercializes Nano-Pulse Stimulation technology to improve and extend the lives of patients. Our strategy to achieve this is to develop a therapeutic tissue treatment, NPS platform, demonstrate the unique and differentiated medicinal benefits of the platform when compared to standard of care in a number of compelling treatment applications, and to commercialize NPS systems to deliver the differentiated benefits of NPS to physicians and their patients. Within each application area or vertical market, we are working with key opinion leading physicians to develop and execute pilot studies to determine where this technology is the highest value to clinicians and patients from a patient outcome, market need and time to market perspective. We will then determine the optimal path to deliver those applications to the market. With that as our foundation, I would now like to provide updates to our previously communicated milestones that occurred in 2017. In early 2017, we completed our first NPS dose-response study in healthy human skin, which provided the first evidence of the patient safety, tolerability and unique cellular effect of NPS in human skin. This led to the initiation of a 60-patient multicenter study evaluating the safety and efficacy of NPS therapy for the treatment of a benign skin lesion, seborrheic keratosis or SKs, one of the most common types of skin lesion which we announced the start of in June 2017. Our goal is to complete the study with 100% follow-up by the end of the year. In November, we announced that all patient treatments were completed and the data analysis would be complete in early 2018. We are pleased to announce that the follow-up and data analysis has been completed on schedule. This study resulted in the successful delivery of 472 NPS applications involving 58 patients and 174 SK lesions with zero adverse events having been reported. All treatments were performed in dermatology offices using only local anesthesia at the treatment site, demonstrating the ease with which NPS can be integrated into an office outpatient setting. This data adds to the mounting evidence regarding the safety and ease with which patients can be treated with NPS for skin-based lesions. With regard to the results of this study, we are pleased to announce that the dataset has been accepted for oral presentation at the upcoming American Society for Laser Medicine and Surgery annual meeting to be held in Dallas, Texas April 11th to the 15th. Our trial data will be presented by the current President of the American Society for Dermatologic Surgery and study investigator Dr. Thomas E. Rohrer. Dr. Rohrer’s presentation titled First Clinical Use of Non-Thermal Nano-Pulse Stimulation to Eliminate Seborrheic Keratosis Lesions will be on Friday, April 13th at 4

[Brian Dow:]

Thanks, Darrin. During 2017, we continued to make significant investments in the development of our NPS technology, our PulseTx NPS delivery system and related clinical and preclinical studies. Cash and investments as of the end of the fourth quarter of 2017 totaled $38 million compared to $42 million at the end of the third quarter of 2017 and $16 million at the end of fiscal 2016. Cash used for the fourth quarter totaled $3.9 million compared to $3.2 million for Q3. Cash used for the full year of 2017 total $13.1 million, modestly ahead of our 2017 guidance. Cash used for both the quarter and full-year reflect operating losses incurred for the respective periods, excluding non-cash stock-based compensation, amortization and depreciation. At this point in time, we expect 2018 cash use to be approximately $20 million. The balance sheet at the end of December reflects the proceeds of $35 million in aggregate financings completed during 2017. Our first financing completed during the first quarter of 2017 yielded approximately $5 million through the sale of 820,000 shares of common stock and price per share of $6.10. Our second financing completed during the third quarter yielded approximately $30 million due to the sale of 2 million shares at a price per share of $15.2. No warrants were issued and no investment banking replacement fees were incurred in either of these transactions. Turning now to operating results. Net loss for the fourth quarter of 2017 totaled $8.7 million, an increase of $1.2 million over the third quarter of 2017 net loss of $7.5 and $5.9 million higher than the fourth quarter of 2016 net loss of $2.8 million. Net loss for the full year ended 2017 total $25.6 million, an increase of $16 million over the full year ended 2016 net loss of $9.6 million. The operating results for the year and quarter ended December 31, 2017 were significantly impacted by increases in stock-based compensation expense, which totaled $10.9 million and $4.5 million, respectively. This represents 43% and 52% of the net loss for the year and the quarter. The significance of stock-based compensation reflects a substantial increase in the trading price of our stock during 2017, the option grants made to 20 net new employees, five new directors, the introduction of the 2017 employee stock purchase plan, acceleration of options granted to the former Board members and ongoing annual grants to existing employees and executives. Aside from increased stock-based compensation expenses, increases in G&A and R&D expenses reflect the Company’s continued growth as we pursue and expand our research and development initiatives and make progress in our clinical programs. Compensation other than stock-based compensation increased $2.1 million or 73% during 2017 due primarily to increased headcount. As of December 31, 2017, we had 33 full-time employees, representing an increase of 20 full-time employees compared to December 31, 2016. Since year-end, we have added an additional five positions and have several open positions and continue recruiting. Consulting expenses increased $1.1 million year-over-year, primarily reflecting increased clinical trial protocol development and support services, regulatory services, and contract engineering services. Clinical trial expenses round out the increase in non-stock-based compensation related expenses contributing an additional $900,000 in expense reflecting costs associated with our seborrheic keratosis study, abdominoplasty study and other smaller pilot studies conducted during the year. On a quarter-over-basis, net loss increased primarily due to $1 million of increased non-cash stock-based compensation, increased compensation costs stemming from headcount growth in both G&A and R&D, research and development expenses relating to our sponsored research agreements with Old Dominion University, our ongoing clinical trials and the ongoing development of the PulseTx System. With that, I will now turn the call over to Darrin.

[Darrin Uecker:]

Thanks, Brian. I would now like to take a look forward at what investors can expect during 2018. As I mentioned earlier, investors can look for the announcement of our SK study data shortly before it is announced that the American Society for Laser Medicine and Surgery annual meeting next month. Next, we expect to commence an additional dermatology study in the first half of the year with potential for additional study starting in the second half. Based on the safety profile, patient tolerance, ease of application and evidence supporting the potential to eliminate canine oral melanoma tumors, we will advance our work in veterinary studies by commencing a second study in stage 1 and 2 canine oral melanoma. And in immuno-oncology we continue to drive our preclinical research, providing evidence to support the potential of NPS in treating cancer. This year, we will continue those efforts, focused on demonstrating the optimal, NPS parameters for driving and adapting the immune response, which we believe will pave the way to successful early feasibility studies in humans. Finally, we plan to submit a regulatory filing for an oncology feasibility study, likely as an investigational device exemption in the back half of 2018. 2017 proved to be a year of significant progress, having secured the resources necessary to drive our technology and applications forward, completing our first clinical application study using NPS with no reported adverse events, progressing in our translational veterinary medicine oncology study and continuing to make progress in our immuno-oncology research and study design, we established a solid foundation from which to launch into 2018. We continue to refine our corporate strategy and programs to provide greater resolution to the commercial opportunities for our technology in the most efficient and valuable ways we can bring this exciting technology to clinicians and patients. That concludes our prepared remarks. Operator, we would now like to open the call to questions.

[Operator:]

Thank you. [Operator Instructions] Our first question comes from the line of Bob [indiscernible]. Your line is now open.

[Unidentified Analyst:]

Thank you. I was recently at the World Congress of Bioelectrics in Norfolk, Virginia where 40 different countries, they presented over 200 lectures and posters in the field of research. My question with all of this research going on in the world, do you feel confident that the patients from ODU, you hope gives the company proprietary access to this research? I might point out that the many of the posters had as additional co-author a professor from ODU.

[Darrin Uecker:]

Hey, Bob, this is Darrin. Thanks a lot for the questions. So, I’m glad you were able to attend that meeting. We obviously attended that meeting, Rich Nuccitelli was invited speaker at that meeting. And as you know and I think most people that have been following this Company know, we have a strong relationship with Old Dominion University, including a license agreement. So, I think we think that the intellectual property in this space is extremely important. And we continue to invest in developing that intellectual property internal to our company but also in collaboration with Old Dominion University through a research agreement. Old Dominion University, as you probably know, was one of the very early institutions involved in this technology. And so, we think our relationship with them as well as relationships that we continue to develop with other research organizations are going to certainly put us in a great position from a technology and intellectual property position. But, we are a company that definitely values that. We will continue to invest in our intellectual property as we go forward.

[Operator:]

Our next question comes from the line of Rodney Baber with Paulson Investment. Your line is now open.

[Rodney Baber:]

That’s Baber. But, everybody does that. So, don’t worry about it. Bob, are you there?

[Bob Duggan:]

Yes.

[Rodney Baber:]

Okay, good. Well, it’s great to have a shot at you. Thanks for coming on the call today. I did miss you at the meeting in Dallas a few months ago. I have learned a lot about you since then. I’m pretty intrigued with what you’ve accomplished in your career and all of that. And sold Pharmacyclics a couple of years ago for a lot money and then you had some time to decide on what you wanted to do, kind of all the different opportunities out there. You picked this one. So, I’d like a little more color. Is it the electroceutical play here, is that the category that you’re buying into? It’s more than nano-pulse electro signaling, it’s got to be a bigger thing for you to want to be and Bob if you could share with us thought process why was this versus anything else you could have done? And what the ultimate opportunity for this is going to be for us that a long-term investors that like to rise something like this for long time?

[Bob Duggan:]

Thank you. I appreciate. I really enjoyed the -- I got involved in biology, the rearrangement of complex reconstructive tissue in robotic that went quite far. We do 3,000 procedures a day now. It’s not over yet. So, great technologies, are able to make significant impact on the healthcare scene. On characteristic, right now, it came into the backdoor at Pharmacyclics, I’d say it’d be medicinal chemistry. And we borrowed the concept from robotics which was -- search from robotics, which was, can you make this more patient-friendly and can you make it physician-friendly as well. So, that worked out quite well. But both of those received a tremendous amount of speculation that it would never work and it’s early and no one has done it before and such. So, I was pretty used to that because I started the world’s Ethernet company back in the day and that took six years for Ethernet to launch, you can even imagine that and [indiscernible] as well. So, I thought -- I mean I recognized that physics becomes chemistry, and chemistry becomes biology. So here is an opportunity to get enrolled in the physics and wavelength. And I really was impressed by the fact that the patient friendliness of this has really been bearing out as Darrin said in the recent study that we’ll be shedding more light on April 13 on Friday afternoon, zero adverse event. So, that’s appealing. So, if you have zero adverse events, then it’s question just how effective are you. And in the world of oncology and immunotherapy to be effective there, it’s I think a significant opportunity. We’ll see just how big it is, but it’s impossible to characterize but we’re seeing initial results, early results. So, we don’t classify this as just, quote, unquote a device, nor is it a drug in the normal sense of the word. It’s done at the atomic level. So, it is a compound of electron, neutron and proton and it does make a significant different. So it’s going to be while, it’s going to be more like a drug like workout period of time rather than a device. So, we’ve decided to exercise the discretion and going in that direction. We’re very happy with our progress. I look at this as a multi-decade business opportunity. It’s absolutely going to be a part of the landscape over time. And I think it’s going become a very cost effective and prolific achievement over time. So, you say you’re an investor, I’m an investor in it. And that’s really the way to look at it is not for the things the apart, nor the short term speculators. But, we are here to make a difference for the betterment. We’re doing that. it’s worth, it’s worthwhile. And I believe we’ve got the right team. I’ve worked with a number of these people for over a couple of decades and new people that are coming on Board are outstanding. We all share a assembly work ethic. So, yes, I’m really excited about it. I just don’t want to -- I don’t want to get carried away on the stock market side. These things take a while to work out and will require additional funding and bringing on additional people. So, for the long haul, I think it’s a wonderful opportunity. It’s the way I like to spend my time.

[Rodney Baber:]

Have you seen an improvement since that’s Dr. Scott Gottlieb put that new letter out on FDA on November last year about stating things [ph] up and new protocols, ways to take information and provide it to them and all that. Are you seeing that...

[Bob Duggan:]

I have a high regard for the FDA and have some excellent relationships within the FDA. I think it’s one of the most -- the highest ROI investments that taxpayers make. And they have been such as breakthrough therapy designations. We were fortunate to receive 3 of the first 5 of those at Pharmacyclics. Patient safety is the essence and preeminent of what they’re really looking for. We have [indiscernible] covered, but this is novel, it’s new, and they’re not going to -- they don’t want to see results, and that’s what we’re going to do. So, I think I view the FDA as a partner, not a barrier. And we look forward to continuing to work with the FDA and through their advice as we go forward.

[Operator:]

Thank you. [Operator Instructions] Our next question will come from the line of Michael Trachtenberg, [ph] private investor. Your line is now open.

[Unidentified Analyst:]

Yes. Hi, thanks for taking my call, first of call. I just wanted to say, this is really exciting way of science you guys are going. And I’m just a regular investor. I just thought -- I came on the call a little bit late. And from last year, when you filed for FDA and then from what I’m kind of gathering, you weren’t sure what direction you want to take, you don’t want to be specifically towards one direction. I thought, I heard maybe you are going to start filing for that FDA approval again by the end of 2018. And I just wanted a little bit more clarification on that. And Bob, hey, it’s great talking to you. I think you’re great guy and I have seen all the work you have done, last caller was fantastic. I think the questions he was asking was great. I wanted to know where you were going with this too. You said the same thing I thought you were going to say and I mean it for the long haul. This is my IRA for retirement eventually, just big little pieces of pharmaceuticals that I like. And I thought this company was fantastic. And I like what you guys are doing. For the FDA, I just wanted a little bit more clarification of when this might actually take off and you start going in one direction or are you holding out to go in multiple directions and you have to kind of put out [multiple speakers] everything at once and then go -- you could go at piece at a time?

[Darrin Uecker:]

Thanks, Michael. I appreciate the question and appreciate you are listening in also. So, with regard to the FDA, I think the point that we are making and that I tried to make in the prepared remarks was that previously we -- and this was at a different point in time, we submitted a 510(k) for a general indication in soft tissue ablation. That was always intended as a potential first step with the FDA but then would require other filings to get specific indications. And so, in a new point in time, and having seen our clinical data and progress that we are making, both preclinically and clinically, and I’d say with the input of our new Board and Bob and Maky and the contacts that they have, we looked at our regulatory path and have come to the conclusion that the most efficient path for us is now to file for these specific indications, most notably immuno-oncology and potentially dermatology where we’ve done some clinical work. And so, it’s really -- it really -- the change is from instead of going for a file 510(k) submission for soft tissue ablation and then building on that with additional submissions, we think it’s going to be much more efficient and effective to go directly for those specific indications. And we don’t -- at this particular time, we don’t have a date to tell you when those submissions will go in. But rest assured, we are working very diligently in these different clinical indications that we’ve spoken about, developing strategies around that and we hope very soon, we will be able to let you know more timing on when those filings will go to FDA and exactly how we intend to proceed down that path.

[Bob Duggan:]

Michael, if I might add to that, a general approval, or file 510(k) approval, gives you a product approval, but it doesn’t allow to achieve a label that has a -- that supports a specific indication. So, you -- from promoting, marketing and supporting that label that indication, those doctors and promoting it to the patients. And that makes all the difference in the world. We just -- we want that ladder I think competitively that makes all the sense world. And structurally it allows us to do very overt about what we do under the umbrella of having been granted that clearance from the world’s number one healthcare entity, the FDA. So that was the directional change. And that will add time, but it adds important magnitude, more value to what we’re doing.

[Unidentified Analyst:]

Got you. I -- just reading, I read up on you guys constantly. And the breakthroughs you made so far, it just seems like things are going really well, and that’s why I was thinking positively. I was one of -- I had PCYC stock when it was just cents. And I sold it at $7 and I made a mistake. But then, I’ve been following things that you do, constantly. And I just want to make sure that I’m in the right place at the right time for my family and my wife and stuff like that. But, I appreciate everything that you guys are doing. And good luck to you and I’m going to stick in there for the long run.

[Darrin Uecker:]

Thanks, Michael.

[Bob Duggan:]

Yes.

[Operator:]

Thank you. And our next question will come from the line of Mark Johnson, a private investor. Your line is now open.

[Unidentified Analyst:]

Hey, really interesting. It seems like the science, it’s still early but it’s coming along. I’ve just got a couple of questions for you. So, really electrochemotherapy has been around for a very long time in Europe. And it’s really not at all used in the United States. So, could you give us an idea as to why you think the U.S. docs will eventually get around to start using it where it’s been around for a really long time in Europe?

[Darrin Uecker:]

So, yes, just to be crystal clear, Mark, our Nano-Pulse Stimulation technology does not include any chemotherapeutic agent. So, when you mentioned electrochemotherapy, that is a completely different treatment modality, where they use electroporation which is a completely different energy system. And they combine that with highly toxic chemotherapeutic agent and inject that often times locally and sometimes systemically. So, that is -- that’s the approach for electrochemotherapy. Nano-Pulse Stimulation has no added agent, no chemotherapeutic, no toxicity. It is a ultrafast electrical signal that gets into the cell and signals the cell using these high, superfast, high-power, small energy pulses. So, we are strongly differentiated from any kind of chemotherapeutic agent type of technology.

[Unidentified Analyst:]

I totally get that. But the reason that’s a -- started using chemotherapy in combination with the pulsed electric field stimulation [ph] that they do because they see very little efficacy from the pulsed electric field stimulation itself. Now, I understand you guys operate somewhat different parameters, but they have gone higher on the frequency side and still have seen very limited effects.

[Bob Duggan:]

We have the specific right for the pulses that range between 1 million pulses a second and a 1 billion. It’s our specific right. And that pulse, you could effectively compare it to combinations that are safe. So, we have a certain set of combinations that open with certain phase that do certain things, certain organelles within the cell, stuff. So, the electrochemical aspect does not have that. So, they can’t get into the safe, no matter what you put in that safe, [ph] it’s going to work if you can’t get in. So, there is a basic common different there. We open things and excite things and trigger and endogenous responses of -- such as apoptosis that they are not able to do. So, you are going to get an entirely different result.

[Unidentified Analyst:]

Yes. They have also done a [indiscernible] before and they have actually seen a lot of apoptosis as well in combination with seborrheic keratosis but there are apoptotic mechanism to lower frequency stimulations as well. So, I don’t know if you have 100% of every single frequency right there.

[Darrin Uecker:]

Well, I appreciate it, appreciate the question. I think we are significantly differentiated from those technologies that you are mentioning, specifically as we are not adding chemotherapeutic agents.

[Unidentified Analyst:]

Could you guys, just as a follow-up give us the timeline and dollars involved that you think will get this thing across the finish line? And I guess you guys are after melanoma. So, those are usually multiyear studies and cost a lot of money and you have got to show either disease free progression or survival for a period of time. So, can you just give us an idea for the total dollars involved there?

[Bob Duggan:]

Yes, we are investigational and exploratory, we are unlimited in terms of the opportunity on a relative basis, it’s not just melanoma, but you have got to start some place and somewhere. And it will take time. Drug usually takes five, six, seven years to mature and commercialize. This has drug like effect although it’s not medicinal medchem [ph] drug. So, it will take a while. And we will see as we get a breakthrough therapy or fast tracking. That’s going to be depended on the outcomes of the procedures that we choose. So, we are in that basis. We are as more motivated, more motivated that anyone to bring this to commercial viability. That’s a mantra that the Company stands by. In the meantime, we go to the market for funding. We have clearly access to all the funds that we need, not in the company but to those that have that kind of funding. So, we are happy about that. That’s really all I can tell you without going out of blueprint that would be inappropriate to do.

[Darrin Uecker:]

Mark, thank you for calling in and thank you for the questions.

[Unidentified Analyst:]

So just to summarize. That’s five to seven years and…

[Operator:]

Thank you. And our next question comes from the line of Richard Gant [ph] a private investor. Your line is now open.

[Unidentified Analyst:]

I think that my question was answered before. But I’m not sure that I understood the answer. You are burning through the cash pretty quickly. And obviously the cash that you have isn’t going to get you through to point of becoming profitable. Do you have any specific plans for how you’re going to capitalize the next four five years?

[Bob Duggan:]

Let me tell you this, when I ran Pharmacyclics, we had about $12 million that quickly was moving towards 10, I thought we would really never go below 10 million in cash. Eight years later we sold the company and had billion dollars in cash and sold it for $21 million and we were approaching $1 billion in revenues. So, a lot can happen in the short period of time. I’m not saying we will repeat those results. We spent $4 million last quarter. We have 38 in the bank at the end of the year; 4 into 38 million goes at least nine times. Not that we’re not going to be accelerating our expenses. But I would tell you this, and you mark it down, we have no problems attracting cash here. We have no problems funding this business here. It’s not the thing to we worry about -- that is not something to be concerned about. We will have to dilute in order to raise funds. Is it 10% a year, 15% a year whatever it takes. But dilution is not something that shareholders like to see. But at the right time, it can build substantial value. So, those that bought in at Pharmacyclics did quite well. We sold stock at about $1.28, $6 up to $100. We’ll see how this works out. But access to money is not a problem. We’ll try to minimize the dilution along the way, it’s in everybody’s interest.

[Operator:]

Thank you. And I’m showing no further questions in queue at this time. I would like to turn the conference back over Mr. Uecker for closing remarks.

[Darrin Uecker:]

Thank you, operator. And thanks again to everyone for joining us on today’s call and allowing us to share our continued progress. We look forward to sharing our continued progress on our next call.

[Operator:]

Ladies and gentlemen, thank you for your participation in today’s conference. This concludes today’s program. You may now disconnect. Everyone have a great day.