Frank J. Fitzpatrick – Chief Financial Officer and Treasurer Dino A. Rossi – Chairman, President and Chief Executive Officer.

Mike Ritzenthaler – Piper Jaffray & Co Daniel Rizzo – Sidoti & Company Lawrence Goldstein – Santa Monica Partners Leslie Sturgeon – Appaloosa Management Anthony G. Polak – Aegis Capital Corp. .

Greetings, and welcome to the Balchem Corporation First Quarter 2014 Earnings Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded. I’d now like to turn the conference over to your host, Mr.

Frank Fitzpatrick, CFO for Balchem. Thank you, Mr. Fitzpatrick. You may begin..

Good morning. Thank you for joining our conference call this morning to discuss the results of Balchem Corporation for the period ending March 31, 2014. My name is Frank Fitzpatrick, Chief Financial Officer and hosting this call with me is Dino Rossi, our Chairman, President and CEO. Following the advice of our counsel, auditors and the SEC.

At this time I would like to read our forward-looking statements. This release does contain or likely will contain forward-looking statements, which reflects Balchem’s expectation or belief concerning future events that involves risks and uncertainties.

We can give no assurance that the expectations reflected in forward-looking statements will prove correct, and various factors could cause results to differ materially from our expectations, including risks and factors identified in Balchem’s Form 10-K. Forward-looking statements are qualified, in their entirety by this cautionary statement.

The financial information that is referenced in this meeting was disclosed this morning in our quarterly press release at 9:30 AM Eastern Time. I will now turn the call over to Dino Rossi, our Chairman, President and CEO..

Thanks, Frank. Good morning ladies and gentlemen and welcome to our conference call. This morning we reported new first quarter record for consolidated net sales of $86 million resolving a net income for the quarter of $8.9 million or $0.29 a share.

As disclosed in this morning’s press release Q1 results included certain unusual items that impacted our results, and I am happy to provide additional detail for you on those items as we proceed through the call.

As mentioned for the first quarter, we reported earnings of $0.29 per share on a GAAP basis, this results include several, certain non-operational items, that I’d like to highlight, the largest item is a pre-tax charge of approximately $1.3 million related to the execution of the definite agreement to acquire performance Chemicals & Ingredients Company (d/b/a SensoryEffects) that we announced in April of this year and our January announcement of an agreement to build and operate a choline chloride facility together with Taminco Corporation.

On a after-tax basis, these transaction charges totaled $0.9 million or $0.03 per share. I am happy to report that we are on schedule to close the SensoryEffects transaction on May 7. We have the integration teams assembled and much progress has been made since the announcement of the deal.

We do expect to incur some additional expense in the second quarter related to the closing and integration of this transaction. Our first quarter sales of $86 million were 1.6% greater than $84.7 million result of the prior year comparable quarter, and were up 5.3% on a sequential basis.

In the quarter our specialty product segment generated first quarter sales of $12.8 million which was equal to the prior year’s quarter. Sales of ethylene oxide used for medical device sterilization increased in the quarter, however were partially offset by decreased sales volumes of propylene oxide for use in certain industrial applications.

Animal Nutrition & Health sales of $61.1 million were up very modestly with the comparable quarter, global feed rate grade choline sales increased, however sales of the encapsulated animal product line were behind the prior year quarter.

Sales for industrial applications comprised approximately 33% of sales in this segment for the three months ended March 31, and grew 2.5% over the prior year period with the increase coming principally from the higher sales of product for usage in fracking.

Food, Pharma & Nutrition segment net sales were $12.2 million for the three months ended March 31 has compared with the $11 million for the prior year quarter an increase of $1.1 million or 10.4%, increased sales of human choline products for both food applications and supplements along with increased sales into the food sector for baking and food preservation end markets were the principal reason for the overall improvement in sales.

Earnings from operations of $13.4 million declined $2.5 million as our business was impacted by a number of items in particular as I mentioned the cost relating to the aforementioned acquisition in joint venture of $1.3 million.

Higher raw material cost relating to an unexpected methanol surcharge of approximately 200,000 unfavorable plant variances relating to weather and related order patterns in the early part of this quarter. And production issues at two of our Animal Nutrition & Health plants along with products mix accounted for the balance of the $2.5 million.

And we’ll talk further about these issues in the individual segments to move forward. As previously noted consolidated net income closed the quarter at $8.9 million down from $10.9 million in the prior year quarter.

This quarterly net income translated into diluted net earnings per share of $0.29 or $0.32 excluding transaction cost as compared to the $0.36 we posted into the comparable quarter of 2012.

Looking between the top and bottom line you’ll see that our consolidated gross profits were $23.2 million or 27% of sales in the quarter down from 28.6% in Q1 of 2013. As mentioned earlier raw material increases had an unfavorable impact on our choline products again this quarter and our reference to methanol surcharge along with ethylene molecule.

As mentioned in previous conference calls we continue to monitor and challenge raw material cost increases, and seek to adjust prices timely within contractural guideline.

Our businesses are likely to be affected by these types of fluctuations going forward also extreme cold weather throughout most of the United States in the early part of the quarter contributed to both reduced sales and production levels as we seek that raw materials were delayed to the severe weather causing production interruptions and inefficiency.

Even though sales with oil and gas fracking space increased 5.2% they two were adversely impacted by weather principally in the oil and gas fracking space as operations at well sites were forced to slowdown due to weather affecting local equipment and supply chain interruption resulting in soft sales in the early part of the quarter.

These sites are now operating at normalized levels and we’re again experiencing growth in this sector. Also negatively impacting the gross margin percentage with the overall product mix with a heavier weighting towards choline products in the quarter.

At the consolidated operating expense level you’ll note a $150,000 increase in operating expenses excluding the $1.3 million of costs relating to the acquisition in joint venture which would equal 9.9% of sales which is comparable to the prior year run rate.

As mentioned earlier we do expect to incur some additional expense in the second quarter related to the closing and integration of the SensoryEffects transition. We expect to continue to leverage off of our existing SG&A infrastructure and exercise tight control over all controllable operating expenses.

Overall, we’re a bit disappointed with our earnings from operations for the quarter and do expect a strong rebound from the slow start through the balance of 2014. The company’s effective tax rate for the three months ended March 31 and 2013 was 33.5% and 31.4% respectively.

The increase in the tax rate is primarily attributable both the timing and delay of certain tax credits and deduction.

Our first quarter results generated approximately $16 million of EBITDA in the quarter, which translates the $0.51 per diluted share and when including our non-cash stock based compensation charge, we generated $17 million of EBITDA or 20% of sales in the quarter equaling approximately $0.55 per share or $0.59 per share excluding transaction costs.

Our balance sheet continued to strengthen and our cash flow remains strong as we closed out the quarter with $207 million of cash. We are well positioned to move forward with our acquisition of SensoryEffects as mentioned earlier we are scheduled to close on this transaction on May 7.

As a reminder SensoryEffects is a privately held supplier of customized food and beverage ingredient system founded in 2005 by Charles Nicolais and headquartered in St. Louis, Missouri.

The purchase price is $567 million in cash SensoryEffects expect to have 2014 annual revenues of approximately $260 million and 2014 earnings before interest tax depreciation and amortization of approximately $53 million.

The acquisition purchase price reflects a multiple of 10.7 times estimated 2014 EBITDA excluding any deal related costs and synergies. The transaction will be financed with existing cash and a new senior secured credit facility consisting of a $100 million revolver and $350 million term loan.

As previously mentioned SensoryEffects provide customized technology driven food and beverage solutions including ingredients, basis and finished goods systems for leading multinational and emerging high growth food and beverage customers.

SensoryEffects management team will continue to lead the food and beverage ingredient business which will emerge with Balchem’s Food, Pharma & Nutrition reporting segment strengthening it’s market position. The acquisition of SensoryEffects accelerates Balchem’s strategic growth plans into health and wellness markets.

Human food and possibly animal nutrition systems. Both Balchem and SensoryEffects have strong foundations in innovation, customer focus and cost efficient business models. The expanded team delivering SensoryEffects solutions and Balchem’s functional-based offerings will be a powerful combination.

Some additional facts relating to SensoryEffects are they have six manufacturing sites in the U.S. three R&D sites with private plants, 20 R&D scientist and approximately 480 employees. Geographic focus is on North America and early development in South and Central America.

I will be happy to answer questions relating to the transaction in a few moments, but first in an effort to detail our consolidated results better for shareholders. I am now going to have Frank Fitzpatrick to discuss the ARC Specialty Products and the Food, Pharma & Nutrition segment..

Thanks Dino. The ARC Specialty Products segment posted quarterly sales of approximately $12.8 million which is equal to the prior year comparable quarter. Sales of ethylene oxide used for medical device sterilization increased 2.2% primarily due to modest price increases to offset rising raw material costs.

The previously noted decline in medical device utilization persist as companies and consumers grapple with the shifts and health care policies and economics resulting in slightly lower volumes of product sold into this space.

Poor weather also had an impact on volumes sold in this sector at plant logistics were adversely impacted resulting in delayed sales. In the quarter, we also realized decreased sales of volumes of propylene oxide for use in certain industrial applications.

Our quarterly business earnings declined approximately $100,000 to $4.8 million versus the prior year comparable quarter. This decrease is principally due to the noted higher raw material costs and increased operating expenses. During the quarter, we did realize increases in the cost of certain petrochemical commodities.

And we also incurred additional expenses pursuing other new end of market applications. Wherein, the products handled today by us may have new market opportunities. For the quarter, the Food, Pharma & Nutrition segment realized sales of $12.1 million, up approximately 10.4% over the prior year comparable quarter.

Correspondingly, business segment earnings of $2.6 million were up approximately 3.7% from the prior year quarter largely due to increased volumes sold. However, partially offset by unfavorable manufacturing variances due to product mix.

These positive results were achieved from increases in sales in the food sector and our human choline products for nutritional enhancement.

We continue to focus on building consumer awareness of the benefits of choline, positioning choline with food and nutritional supplement companies as an essential ingredient with excellent therapeutic benefits for all ages.

We continue to utilize the structured function claims awarded to Balchem by EPSA in Europe, support additional scientific and research externally and are excited with the growing number of projects in the pipeline targeting choline and other nutritional inclusions.

Also contributing to the higher sales were increases in sales in the food sector, principally from the encapsulated ingredients for baking and food preservation end markets. Strong results for our food products in this quarter were principally realized in the domestic market.

Results for this segment continue to refresh to the roller coaster effect of pipeline fills, inventory level management, and customer marketing initiatives. Our pharmaceutical delivery development efforts continue.

As previously reported, the licensing of our technology being used for treating autism, concluded a Phase 3 clinical trial, has conducted a successful pre-new drug application meeting with the U.S. Food and Drug Administration and is filing its New Drug Application. We continue to work closely with them in support of the NDA filings.

In the near-term, this sector remains a net expense for the business segment. I will now turn the call over to Dino for him to discuss the Animal Nutrition & Health segment..

Thanks Frank. In the Animal Nutrition & Health segment we realized sales of $61.1 million, a very modest increase as compared to the prior year comparable quarter. However, up approximately 10.7% on a sequential basis.

Sales of the ANH sector were approximately flat at $41 million, this result however reflected 2.4% growth or $0.7 million of the monogastric species, with particular strength in the European markets served by our Italian operation which was somewhat offset by a soft North American result.

Volumes sold in these markets are strongly influenced by the various dynamics of our customer base predominantly the poultry production industry, but also swine and aquaculture markets. North American choline volumes sold typically track closely with broiler chick placements and egg sets.

The current USDA forecast for broiler meat production continues to forecast modest growth for the balance of 2014. However, the most recent estimate for broiler meat production for 2014 is down slightly, as production fell by 2.8% in January due to a decrease in the number of birds slaughtered and a slight growth in average weight.

In Europe, sales of feed grade choline increased in the quarter as Chinese competitors in this space were adversely impacted by GMO contamination issues in the EU market.

The ruminant species results were off a 11.6% or $1.3 million with softness in our AminoShure and chelated mineral volumes, largely due to production issues, which have since been resolved. Milk prices remained strong in the quarter, and expectations at reasonable feed prices and continued demand strength in U.S.

and export markets are all positive indicators that should support growing utilization of these products. Sales of the industrial grade products grew approximately 2.5% from the prior year quarter largely due to growth in the North American fracking market.

Sales of methylamines, derivatives, and choline for industrial applications in Europe were down in the quarter, while sales of industrial grade product sold into the North American fracking market grew approximately 5% this growth in the fracking space was impacted by the severe cold weather which swept across the United States, interrupting drilling and fracking throughout Q1.

In addition I’ll note that our success in this space continues to attract competition from offshore producers. We do however remain confident that these products will continue to show strength in 2014 driving steady to increasing levels of sales as we believe the end market will continue to grow.

We continue to evaluate our industrial opportunities with other core technology can determine how we may drive innovative solutions into this and other markets to derive the most positive value.

Our earnings from operations for this entire segment fell to $7.3 million is compared to $8.4 million in the prior year comparable quarter, primarily due to higher raw material cost which could not be passed timely through to customers.

Also negatively impacting the gross margin percentage, was an unfavorable product mix with a heavier weighting towards choline and some production issues which have since been resolved. We continue to challenge the raw material price volatility and seek to implement price adjustments within our contractual guidelines.

In January of this year we announced that Balchem and Taminco had reached a joint venture production agreement to build and expand on the existing footprint of our choline chloride facility in Saint Gabriel, Louisiana. We expect that additional capacity from this production JV to be online in this second half of 2015.

As stated in our press release joint venture will manufacture choline chloride. Balchem and Taminco will market the products through separate and fully independent channels.

This collaboration will lead to a state-of-the-art unit using the most advanced technology, generating advantages of scale, and providing customers a high quality product and a reliable supply chain at competitive cost.

This new capacity will help to serve the growing North American market which is underpinned by increasing demand for choline chloride, a quaternary compound, functioning as a clay stabilizer in oil and gas drilling and hydraulic fracturing applications.

We will keep you appraised of the progress being made towards completing this facility in future conference calls. Overall we continue to see a bit of the revenue roller coaster quarter-to-quarter within the various products and market segments, this quarter was no different.

We remain committed to organic growth as we look to continually expand our product offerings and move into new geographies. We expect to strengthen our global growth platform and our confidence and more business can be generated based on the unique portfolio of the products that we offer to market we serve.

Our business continues to create good balance, yielding profitable growth opportunities across the served value chain. We also remain focused on helping our customers to generate reinvestment level of returns, while maintaining our own operating discipline.

We continue to build the financial strength of the company, managing the working capital base aggressively and yielding solid financial results to be a quality supplier. Near-term, we are focused on integrating the previously announced acquisition of PCI a. k.a.

SensoryEffects, which we are very excited about without taking our eyes off of operational and logistic improvement, new product development and new product introduction across all business segments.

We will continue to explore alliances, acquisitions and/or joint ventures to build and leverage on our strategic marketing direction, technology and strong human asset base, which more than doubled with the SensoryEffects acquisition.

These efforts can and will impact operating expense levels beyond the normal levels we have seen in the past, but is consistent with the noted strategy to complement our organic growth. This now concludes the formal portion of the conference. At this point, I will open the conference call for questions..

Thank you. We will now be conducting the question-and-answer session. (Operator Instructions) Thank you. Our first question comes from the line of Mike Ritzenthaler with Piper Jaffray. Please go ahead with your question..

Yes, good morning. My first question is on SensoryEffects, and around potential revenue synergies.

How important were potential revenue synergies as you evaluated how SensoryEffect would fit into your portfolio?.

Mike, I guess when you say revenue synergies, I mean normally people are talking about cost synergies. So when you say revenue synergies are you looking at our ability to leverage off of each other...

Yes, exactly. And I know you haven't – yes, exactly right.

I know you haven't guided to anything specific, but as you look at the different products and where they're placed how that played into how you thought about that acquisition?.

Yes, I think you know that, I mean we’ve basically been an ingredient supplier into the food and nutritional industry, whereas Sensory is there with solutions. And that solution is really incorporating a number of different ingredients and quite honestly leveraging their ability to bring a broader base solution to individual customers.

The customer overlap between the two business actually is not that great, which we found attractive the ability of cross selling we think it’s going to really result in some really nice opportunities. In fact the opportunity to get more inclusion of our ingredients into their solutions I think it’s very attractive as well.

So all of those played through I think in the decision to look and aggressively pursue Sensory as a transaction for us. But if we thought we could really leverage pretty neatly off of both parts of theirs as well as our to really grow much more aggressively in new spaces..

Thanks for that.

So to what extent does the new leverage, so the $350 million term loan and the revolver, how does that play into your thoughts on M&A going forward? And does it inhibit what you're looking at, or in size wise or anything like that as you think about further M&A?.

Yes. I think we did look at that real hard. And in fact I think you all know, we were quite underleveraged. But our view even with it is that we are still rather underleveraged if you will. We are going to be less than 3X on the EBITDA versus debt load.

So the intent certainly is to drive that down, and really feel that, we still have a lot of dry powder to continue to execute additional transactions. Certainly part of the growth of Sensory has been around M&A rather aggressively.

And so there is been a lot of discussion through the process too, about our commitment to continue to do that, which we’re certainly very interested in doing. Let alone I think looking at the balance of our business portfolio and opportunities that are going to be presented there.

So I think our view is that we still have a lot to work with, if you will, and certainly an expectation, that we are going to continue to move down that path..

Okay. And one last one from me.

On the implications for the tax rate post acquisition, is there any reason to revisit the 33% expectation for 2014?.

Yes, I think that our view is that might pick up a little bit from that number, I think that purchase accounting is not done yet, i.e. levels of goodwill and intangibles that go with it. So we’re not there. If I had to hedge any way, I’d probably hedge up maybe a 0.5 point..

Okay, thanks very much..

Thank you..

Your next question is from the line of Daniel Rizzo Sidoti & Company. Please proceed with your question..

Hey, guys..

Hi, Dan..

You indicated that increased competition was something in the quarter in the Animal Nutrition & Health segment.

Is that the same thing we saw two years ago, where the competition showed up for about a month and then went away? Do you expect a similar scenario to unfold?.

Yes, I think that, yes part of it for sure is the Chinese in particular and they get aggressive and then they back off, they get aggressive and they back off, depending on. I think what’s going on with their raw material cost situation. So that I think the other part is that Taminco has I’m going to say indirectly entered this market as well.

Clearly, interested in the oil and fracking side of the business, so that too was part of the discussion as we entered into this joint venture. So I think that will probably be there in more permanence probably out a year, year and a half if you will.

But to be honest though, I think our view is that the market is going to continue to grow at a rate, where you can easily consume if you will, what’s going to be this additional capacity being built into this space.

And with good quality product, probably the more important thing, so but I do think that there’s definitely, its like anything else, when it gets so good people sit up and pay attention and that has happened. But I also think that, we will continue to be positioned as a low cost producer and be able to deal with that marketplace..

Okay, all right. Thank you..

Thank you..

Our next question comes from the line of Lawrence Goldstein with Santa Monica Partners. Please proceed with your question..

So from the numbers you gave us on performance solutions, you've got a forecast for an EBITDA and revenue, and margins, and effect.

Do you have one for Balchem?.

Yes, we do. Typically we’re not giving guidance..

Right. But you chose to forecast the other. .

Well, I gave that, I think to help everybody understand the purchase price a bit more and but we took a big on deal…..

Okay, I’ll give you that.

So tell us this, can we, when the dust settles, and in the fullness of time, see the margins of the full company? Or maybe I should ask are the margins of performance solutions as you think about them comparable to yours? Historically, return on capital over 19%, return on capital, and the profit margins, the return on equity, and so forth, and because based on the raw material that you gave us, they're going to have an EBITDA margin just over 20%.

And yours last year was just under 23%, 22.6% or something.

And so, our overall, how's it going to be? Is this going to enhance or the historical margins and returns? Or is it going to be comparable, or what? What's it all about? By the way, I hope your comment about being an ingredient company and they being a solution company isn't going to be like what I really hate.

When I go to my dermatologist and he says, oh on the way out, pick up a can of that ointment. That'd be $10 for that. It's so unseemly.

Are you going to run into that kind of thing, them selling - or you can buy - here's the solution, and the ingredients you can buy from our other division?.

No, I don’t think so I mean our intend is going to be the merge that is effectively as possible I mean I do things that there is going to some customers who will continue to what to buy an ingredient if you will.

But clearly there is a trend in the industry to go to these multiple ingredient based solutions and just looking at the performance of Sensory kind of points that out as a perfect example of those. And I could probably point to some other companies in the industry that are, have done the same maybe in probably different markets.

Full-service, would that be the idea?.

Well, yes I don’t know about full service but it’s certainly a significant effort to go to kind of one stop shop maybe without absoluteness there. But certainly with the idea, that a lot of that can combined and perhaps even needs to be combined in a certain way to give full effectiveness business in this solution in the market.

So I think there is value in that and quarterly if you look at the Sensory results up close, you’re going to see that they have able to kind of prove that out into market. Certainly our expectation is that that’s going to continue to grow.

I think the idea of incorporating our ingredients into their solutions in a much larger way it makes that solution even more attractive if you will for those end markets with higher quality and novel offerings into the space.

So coming back to your first question in terms of the margin we studied that and do things that there is upside opportunity here on those margins, both I think individually on their business as well as in combinations with ours, that may be I alluded to this earlier product mix and we’ve talked about this back and forth to some degree that’s offset the lower end of our profitability which is choline with a product line that’s certainly runs higher.

And so as product mix and percentage of the business waits more now to the food, you could argue that it should help to at least minimally keep the margins where they are if not move them up.

I see. By the way, is that $53 million and $260 million, where the $53 million, let's put it that way, of EBITDA, is that as a private company or is that how you see it as a public company? In other words, as a private company we've got to assume they had expenses that you wouldn't have.

No? Yes?.

Yeah, we sorted through that pretty intently. When we did the analysis and ran their quality of earnings, so I think that arguably there's expenses that may be they were incurring that they won’t incur under our umbrella because we are already incurring them.

So that’s I think that number looks to be what we expect that business would do after adjustments..

And you said it would be additive to the bottom line.

So that's only several million, isn't it? After taking into consideration the interest you're going to pay for this year?.

Yes I think well a lot of that is to be sorted out this year I think its going to be more than a couple of million but certainly the interest expense will play through it and offset against that early on for sure..

Okay. Thank you. We've been waiting. And you did it..

Thanks..

(Operator Instructions) The next question is from the line of Leslie Sturgeon of Appaloosa Management. Please go ahead with your question..

Hi thanks for taking the question. I had two follow-ups on the SensoryEffects business.

As we try to understand that business a little better, who are the best comps there? Is it someone like Ingredion? And then second question, is the texture ingredients or solutions segment one in which you see additional expansion opportunities in the pipeline?.

Well, I guess first question, I don’t know that Ingredion necessarily is a good comp I mean there is a fair bit of that business that was CPC which was more commodity if you will but certainly more perhaps along the line of National Starch margins might be a better comp. So I don’t know that you are going to get few comp play out there.

There are some other big companies in the space like Kerry but they really aren't exactly the same either, so I don’t know that there's an absolute comp of a publicly traded company that you could run to, and try to draw too many conclusions from. So that’s I couldn’t necessarily give you a direct point of comparison there.

As far as the textured solution, I assume you are talking about the powder business of Sensor?.

Right..

And certainly I think our view is that there is a significant part of their business revolves around powders, whether it's called, powder solutions, or flavor solutions, or in different end market for sure in particular into the dairy and beverage marketplace where we historically have not really quite very aggressively.

So we think that those represent nice upside opportunities, to move more ingredients to that channel and certainly I think as we’ve studied the business, the expectations is that really does have a lot of upside opportunity.

And in fact couple of the acquisitions that they’ve recently done have really been geared to picking up additional capacity, to be able to deliver on that growth projections. So I would say even on a go forward basis a number of the acquisition that they have targeted are clearly in that space to grow with those powder blends..

Great, that’s very helpful..

Thank you..

Next question is from the line of Tony Polak with Aegis Capital. Please go ahead with your questions..

Good morning..

Good Morning..

Could you give us an idea of the growth of Sensory over the last few years? Where they've come from, and is it similar growth to yours? Less? More?.

Well, Actually, Sensory is all of eight years old. So they’ve grown to $250 million, $260 million over that window of time. And it's been through a number of acquisitions for sure and I mean it is started from zero about eight years ago. So its been a tremendous growth story that it's been organic as well as through M&A.

So it’s hard to draw a growth percentage number given I’m going to how its grown so quickly via acquisition and/or organically. But over the last couple of years you’re probably talking from 30% or 40% a year.

So it has been very aggressive and again kind of leveraging off those acquisitions and clearly growing organically as well on the back of those complimenting each one I think..

Okay.

In terms of the autism drug and anything else you're working on, is there any timetable or is there any feel for other potential deals like the deal with Curemark?.

I would say that clearly far and away that that’s the one that’s furthest down the pipeline and I think it's going on the pipeline. We continue to support them we’ve done everything we need to do with them they have begun their filing.

And as far as we understand everything is on track it just as we’ve talked before seem to take longer than not to do these things but recent meetings certainly indicate that things were on track and moving forward and our view right now is perhaps early next year we may begin to see some revenue generation there..

Is there any statistics that show how many kids that were originally in the trials are still taking the drug? Or what is it called, is it called a drug?.

Yes it is and while fact of the matter is that we’ve continue to make some products available which if you will for the kids that stayed in the program. Kids that have “8000” the FDA has agreed to up that upper limit of age clearly because there was performance seen and the decisions made to keep these children on the product.

So I think those indications are still very solid out there and so as we’re not aware of huge volume of kids stopping to take the product or anything like that, so again I can’t say that we are privileged to know all of those details better directed to Curemark themselves probably..

Okay, thanks..

Thank you..

Thank you. At this time I will turn the floor back to Mr. Dino Rossi for concluding comments..

Okay. Well, thanks everybody for sitting in on the conference call today. As I said I think we were a little bit disappointed with the results. But we feel pretty confident that we understand why, and the fact that we're looking for this to rebound pretty neatly here in Q2. So with that I’ll say thanks again and appreciate all your support.

We’ll talk to you soon. Thanks bye..

This does conclude today’s teleconference. You may disconnect your lines at this time. Thank you for your participation..