John McDonough - President and Chief Executive Officer John Sprague - Chief Financial Officer.

Puneet Souda - Leerink Partners Patrick Donnelly - Goldman Sachs Soumit Roy - JonesTrading Mark Massaro - Canaccord Genuity Paul Knight - Janney Montgomery Steve Brozak - WBB.

Good afternoon, ladies and gentlemen. Thank you for standing by and welcome to the T2 Biosystems 2018 Second Quarter Financial Results Conference Call. At this time all participants are in listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time.

It is now my pleasure to turn the call over to Zach Kouwe [ph] of the W2O Group. Please go ahead sir..

Thank you, operator, and good afternoon, everyone. Thanks for joining us for the T2 Biosystems 2018 second quarter financial results conference call. On the call to discuss the results and operational highlights for the quarter ended June 30, 2018, are President and CEO, John McDonough; and Chief Financial Officer, John Sprague.

The executive team will open the call with some prepared remarks, followed by a question-and-answer period. I would like to remind everyone that comments made by management today and answers to questions will include forward-looking statements.

Those include statements related to T2 Biosystems' future financial and operating results and plans for developing and marketing new products.

Forward-looking statements are based on estimates and assumptions as of today and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied by those statements, including the risks and uncertainties described in T2 Biosystems' annual report on Form 10-K filed with the SEC on March 19, 2018, and other filings that company makes with the SEC from time to time.

The company undertakes no obligation to publicly update or revise any forward-looking statements except as required by law. With that, I would like to turn the call over to President and CEO, John McDonough. Good afternoon, John..

Thank you, Zach. Good afternoon, everyone, and thank you for joining us as we discuss the progress, results and outlook following our 2018 second quarter.

The highlight of the second quarter was the FDA clearance of the T2Bacteria Panel, announced on May 29, setting the space for what we believe to be the most important product launched to date at T2 Biosystems.

While we have been working towards this goal for years, in many ways achieving this clearance is like the new star here at the company, and everyone is energized to support the launch. T2Bacteria is the first and only FDA-cleared test to identify sepsis-causing bacteria directly from whole blood.

Combined with the T2Candida Panel our T2Direct Diagnostics offering is now uniquely positioned is what we believe will become a must have technology to significantly enhance the existing sepsis protocol to deliver better patient outcome, and reduce healthcare spending on this often preventable condition.

Our vision and that of many users is that our products will eventually allow for a new protocol and revised standards for addressing patients that with the sepsis.

And while other technologies will play some role in the fight against the infections, no technology available today can come close to the speed and accuracy of our platform for detecting the most critical information that can enable targeted and effective therapy.

In short, we believe the time will come in the not so distant future when it will be simply irresponsible for relies fully on blood culture-based protocol and probability-based trial on our medicine for one of the most deadly conditions in the hospital.

We were pleased in June to raise $52.6 million in gross proceeds from an equity offering, providing additional capital to support the launch and execute on our other strategic initiatives. With that said, I am pleased to report the T2Bacteria launch is progressing its plan and the early feedback has been highly encouraging.

I will provide some more color on the launch in a moment. But first, I'll provide a high level summary of key financial results and commercial metrics for the quarter. After my remarks, I’ll pass the call to our CFO, John Sprague, who will provide a detailed financial review, including a recap of our full-year guidance.

In the second quarter, we reported total revenues of $3.9 million and product revenues of over $1.2 million. Both revenue levels met or exceeded our guidance. And more importantly reflects solid trends in commercial activity, predominantly based on activity before the T2Bacteria clearance and launch.

Overall, product revenue grew 71% from the second quarter of 2017, driven by growing sales of the T2Candida Panel and the T2Dx Instrument. This included increased T2Candida usage on a same-store basis over last quarter, a positive sign that utilization is growing overtime.

We also delivered encouraging results across the key commercial metrics that we measured to evaluate the health and outlook of our business.

During the second quarter, we continue to build momentum with new instrument contracts, securing 10 contracts for the placement of the 9 T2Dx Instruments, ahead of our guidance for 6 new contracts and 8 new instrument placements during the quarter.

This will provide an estimated over 45,000 high risk patients with access to T2Dx, ahead of our target of growing by 35,000 patients in the quarter.

In addition, we had another strong quarter building our sales pipeline, reflected by the sustained increase in new proposals delivered over the past three quarters, leading into the FDA clearance for T2Bacteria.

In the United States, we delivered 20 proposals in the second quarter following 17 delivered in Q1 and 24 delivered in Q4, which is 2x to 3x higher than the average number of proposals delivered per quarter earlier in 2017.

To date 9 of these proposals have turned into signed contracts, and all of the other hospitals have received proposals remain actively engaged. As of June 30, 2018, we have 73 instruments placed or contracted to be placed covering 158 hospitals in the United States and worldwide. We estimate that each instrument in the U.S.

may generate approximately $300,000 in recurring revenue every year, once hospitals go live and ramp-up testing the patients with T2Bacteria and T2Candida which could take 12 to 18 months. Let's turn now to discuss the launch of T2Bacteria.

We're off to a strong start, and it's clear that the market has been eagerly awaiting the availability of T2Bacteria. Our sales reps have been actively engaging with our existing customers, targeted hospitals and responding to inbound interest.

Compared to our prior experience with the launch of T2Candida, due to an elevated level of excitement and urgency, and were confident that this will be a tremendous catalyst for our business. We entered the launch with the 20-person U.S.

sales organization that includes 12 sales representatives, and we plan to add about 4 new reps by the end of the year.

It is important to note that we still assume the sales cycle for new hospitals will be in the range of 6 to 12 months, and then will take another 3 to 6 months for hospitals to take delivery, calibrate, train and begin utilization of the platform. This is typical of all other new diagnostic platforms.

Shortly after receiving FDA clearance we attended the American Society for Microbiology or ASM Microbe Conference on June 7 to 11.

ASM Microbe is one of our largest customer meetings of the year, and it provided an excellent opportunity to raise awareness of the T2Bacteria Panel as a significant new addition to the T2Direct Diagnostics' offering for the identification of sepsis-causing pathogens directly from whole blood in 3 to 5 hours.

We had a strong and booth presence featuring key opinion leader presentation in our new marketing material. This was complemented by late-breaker posters and data presented on the T2Bacteria Panel highlighting its accuracy and speed. The first U.S.

presentation of the T2Bacteria pivotal clinical trial data was presented at ASM, covering a large study of over 1,400 patient samples collective across 11 hospital and hospital systems across the United States.

We've discussed the strong accuracy data from the study and others on the path, but I want to highlight a couple of additional results presented by the investigators.

T2Bacteria provided results more than 2.5 days faster than blood culture species identification and detected 69 patients' blood stream infections that were not affected by the concurrent blood culture.

More than 68% of patients of the clinical trial with the blood stream infection confirmed by both T2Bacteria and blood culture could have benefited from earlier appropriate antibiotics based on the rapid T2Bacteria results.

T2Bacteria also had a noted advantage in detecting infected patients on antibiotics who were missed by the concurrent blood culture.

These are meaningful differences in speed and levels of detection, which is part of our core messaging that the combination of T2Bacteria and T2Candida compositely impact patient lives by allowing a faster and a more targeted therapeutic approach to treating patients, while potentially saving institutions millions of dollars each year.

We believe this is resonating in the marketplace, and are encouraged by the interest from potential customers that we have targeted from the launch and from new inbound interests generated at ASM and through other channels.

In addition to the data presented at ASM, we also a saw continued growth in the number of published studies supporting our technology platform. This included five studies on T2Candida and one on the T2Candida auris panel published by the CDC.

One of these studies with the recently published case study from Spain that detailed how the T2Candida Panel contributed to the healthy discharge of a one-year-old transplant patient suspected of having sepsis by providing infection results early in the blood culture and leading to more targeted antifungal therapy.

The cadence of peer-reviewed journal articles on T2Candida serves as a valuable proof point for our technology platform and the T2Bacteria Panel. Overall our commercial team is off to a great start with the launch of T2Bacteria.

And we are proud to be changing the clinical conversation in the economic equation as it relates to sepsis prevention and management. Before turning the call over to John Sprague for the details of our Q2 financial performance, I’d like to provide a brief update on our pipeline and development efforts.

In May, we enrolled a first patient in our FDA clinical trial for the T2Lyme Diagnostic panel. The study will evaluate the clinical performance of T2Lyme compared to skin biopsy and/or detection of the C6 anagen. We expect this clinical trial to continue into 2019, which may enable us to make a suggestion to the FDA sometime next year.

We estimate the size of the T2Lyme market to be $700 million and we believe we can make a difference in detecting this growing disease by directly detecting the bacteria that enters the bloodstream from a tick bite.

The T2 Gram-Negative Resistance Diagnostic panel, being developed through a partnership with Allergan, remains on track for delivery of initial product of Allergan by the end of this calendar year.

In the future, this product could be used to determine if a patient is resistant to the first line therapy associated with certain deadly gram-negative bacterial infection. The initial development efforts of our expanded T2Bacteria panel are underway as part of our collaboration with CARB-X.

The new tests aim to address to most serious superbugs and resistant genes on the antibiotic-resistant threat list published by the CDC. The test delivered by T2 Biosystems will aim to identify 20 or more additional infectious species and resistant genes directly from whole blood beyond T2Bacteria and T2Candida.

With that, let me turn the call over to John Sprague, who will review our second quarter 2018 financial results in greater detail.

John?.

Thank you, John. Second quarter 2018 total revenue of $3.9 million, exceeded the high end of guidance by 18%, and increased 17% over last quarter’s revenues of $2.3 million and 209% over last year’s second quarter revenues of $1 million.

Product revenues, primarily T2Candida panel and T2Dx Instrument sales, of $1.2 million were above the mid range of guidance, a 20% increase over last quarter’s product revenues of $1 million, and a 71% increase over last year’s second quarter product revenues of $0.7 million.

Research revenues were $2.7 million compared to $1.3 million last quarter and $1.2 million in last year’s second quarter. Research revenues included a one-time, $1.3 million, milestone payment from our partnership with Canon.

Costs and expenses, excluding cost of product revenue, were at $11.4 million compared to $10.5 million last quarter and $12.9 million in last year's second quarter and include depreciation and non-cash stock compensation from stock options and restricted stock unit or RSU grants.

Non-cash depreciation and stock compensation expense was $4 million compared to $1.7 million last quarter, and $1.8 million in the last year’s second quarter, increased primarily due to the vesting of performance-based RSUs.

Operating margins were a loss of $10.9 million compared to a loss of $11.4 million last quarter and a loss of $13.9 million in last year's second quarter. Net interest expense and other non-operating expenses were $1.4 million compared to $1.5 million last quarter and $1.6 million in last year's second quarter.

Our net loss was $12.3 million, $0.32 per share compared to a net loss last quarter of $12.9 million, $0.36 per share, and net loss in last year’s second quarter of $15.5 million, $0.30 per share. Weighted average shares outstanding were $38.3 million compared to $36 million last quarter and $30.7 million in last year’s second quarter.

Our cash and cash equivalents were $7.7 million at June 30, 2018. As John mentioned, in June, we raised $52.6 million gross proceeds from equity offering. We believe our cash and financing sources are sufficient for at least the first half of 2020.

The brand [Indiscernible] runway has demonstrated the new T2Direct Diagnostics offerings have changed the commercial trajectory of the company. First half 2018 total revenue was $6.2 million, an increase of 226% over the last year's first half revenues of $1.9 million.

Product revenues primarily T2Candida panel and T2Dx Instrument sales were $2.3 million, a 64% increase over the last year's first half product revenues of $1.4 million. Research revenues were $4 million compared to $25 million in last year's first half. Research revenues included a onetime $1.3 million milestone payment for our partnership with Canon.

First half 2018 cost expenses, excluding cost of product revenue were $21.8 million compared to $25.3 million in last year's first half and include non-cash depreciation and stock compensation from stock options and RSUs.

Non-cash depreciation and stock compensation expense were $6.2 million compared to $3.4 million in last year's first half and increased primarily due to vesting performance based-RSUs. Operating margins were a loss of $22.3 million further loss of $27.1 million in last year's first half.

Net interest expense and other non-operating expenses were $2.9 million compared to $3.1 million in last year's first half. Our net loss was $25.2 million, $0.68 per share compared to a net loss of $30.2 million, $0.99 per share in the last year’s first half.

Weighted average shares outstanding were $37.1 million compared to $30.6 million in last year's first half. Second half 2018 outlook. The following forward-looking statements reflect estimates based on information as of August 2, 2018, and are subject to uncertainty.

We reaffirm our guidance presented on our May 29, 2018 conference call and we are increasing well and above range for this year's expected revenue. We expect 2018 revenue to be $10.5 million to $12 million, up from the previous guidance of $10 million to $12 million.

Product revenue is expected to be in the range of $5 million to $5.9 million, up from the previous range of $4.5 million to $5.9 million. Research revenue is expected to be in the range of $5.5 million to $6.1 million.

We expect revenues to [indiscernible] in each of 2019 and 2020 as more accounts go live in our testing of T2Bacteria will exceed total revenue 2020 in the range of at least $50 million.

In the second half of 2018, we expect close contracts for the placement of 20 to 25 instruments with approximately 17% of these instruments to be placed in the United States. We expect that these placements will provide access to at least 75,000 patients suspected of sepsis.

The number of high risk patients is important as it represents the currently existing market opportunity for the T2Candida and T2Bacteria panels if every patient at hospitals under contract were tested in time have showed symptoms of infection.

However, this metric is becoming increasingly difficult to accurately track and report, and ultimately become less meaningful as we expand our installed base and drive adoption into this high risk population, which will be reflected in our utilization in the current T2Bacteria and T2Candida panel cells.

Therefore we are likely to discontinue to metric accurate reporting results for the fourth quarter and full year 2018. As John mentioned, the Phase 2 instrument placements on average three to six months to go live and patient testing commences at hospitals are quite about any new diagnostic tests in instruments.

During this period it can be typically receives normal revenue on those instruments but then purchased by the hospital, looking as days occurs almost 15% of the time. International distributors typically purchase instruments at a 30% discount offer which price $100,000 per instrument.

We expect the average sales price for T2Bacteria panel $150 and for T2Candida panel to hold at $200 per test. International distributors typically receive about 30%. We estimate that a single T2Dx instrument capable of running about 3,000 tests per year.

Overtime as patient testing grows in the hospital, we expect each T2Dx instrument currently about $300,000 in annual revenue from the combination of T2Bacteria and T2Candida assessments.

We expect quarterly operating expenses to stay in the range of $10.8 million to $11.8 million per quarter in the second half of 2018, including non-cash depreciation and stock-based compensation of approximately $2 million each quarter and non cash stock based compensation from performance-based RSUs of $8 million each quarter.

Non-cash stock-based compensation expenses maybe impacted by the timing of performance-based RSU investment. We estimate that we will achieve cash flow breakeven between $65 million and $75 million in annual revenue. We expect our gross margin to be approximately 45% to 50% at these revenue levels.

Our weighted average shares outstanding of $38.3 million may be impacted by stock option exercises. Thank you. And back to John McDonough for closing remarks..

Thank you, John. In summary, we continue to make commercial progress and are encouraged by the initial feedback from the rollout of the T2Bacteria launch.

We expect the launch will drive increased instrument placements in the second half of 2018 with momentum continuing to build in 2019 and beyond, as our installed base continues to grow and we drive higher volumes of recurring testing revenue.

We remain confident that this will allow us to at least double our revenue in each of the next two to three full-years. I'd like to thank the fund managers and analysts who participated in our recent financing. We are working hard and smart to make sure that your confidence pays off.

We continue to expect the T2MR breakthrough the one day DC is one of the most important developments in fighting infectious disease and making septic infection follow less lethal resulting in far more patients being discharged and walking out of the hospital.

Thank you for your participation in today's call, and for your continued interest in T2 Biosystems. That concludes our prepared remarks for this evening. Operator, we'll now open the call for questions..

[Operator Instructions] And our first question comes from Puneet Souda with Leerink Partners..

I hope you understand, in the quarter, did you see a pick-up here in any of the ER accounts? Are there certain accounts this specifically in the microbiology labs that picked up? Just give us and help us understand was there more confidence among the customers now that -- now with the approval in hand? And I have a follow-up..

So there is no question, there is a lot more confidence among customers now that the T2Bacteria product has cleared. I think it's safe to say that in over 90% of the accounts that are kind of in the pipeline that that can close here in the next six months. It's really being driven by T2Bacteria.

And about 70% of T2Bacteria interest is really being driven by initial use of the emergency department. So we're really encouraged, obviously, it's early in the launch, but we're encouraged with the development of the pipeline or encouraged with the interest. We had a national sales meeting here at our headquarters last week.

And all the data that came out of that through territory reviews and training and the like that gave us a lot of optimism as we enter the second half in the year..

And then in terms of the menu, what's being the feedback for the T2Bacteria menu versus the current blood culture products from some of the customers.

Could you elaborate on that?.

Yes, I mean there is strongly acceptance for the menu. There is a good understanding that these pathogens are the ones that typically are not covered by broad spectrum antibiotic drugs.

And that there are real opportunities here to get more patients on the targeted penalty days faster than what's happening today and also opportunities with negative test results to de-escalate drugs the patients are being treated with. .

And in terms of T2Candida and versus Bacteria longer term, how should we think about the mix as we go into 2019 and 2020 where you talked about doubling the revenue? How should we think about the mix here longer-term?.

Yes, the pieces here resonate we believe will continue to grow on cadence kind of comparable to what it is we've been seeing. And as we get into 2019, specifically Bacteria at some point during that year probably overlays T2Candida in total sales thus T2Candida continue to grow little by next couple of quarters. So that’s a play itself up.

But Bacteria, without a doubt, will be the flagship product for the company. The good news is that adoption being driven by Bacteria will pull along T2Candida usage, we believe, in most of the accounts that close as well..

Our next question comes from Patrick Donnelly with Goldman Sachs. Please go ahead..

Obviously, a big change in Bacteria not only commercially, but makes you more attractive partner biopharma and other potential collaborators.

Can you just talk about the pace of conversations with pharma partners? Is that accelerated with Bacteria online and just the outlook there, in general, over the next year or two?.

Yes, it's definitely accelerated. It's opened up opportunities. There is more antibiotics in development are then antifungal. So there is definitely new opportunities emerging. And it's tough to say, I mean, I’d definitely expect to see us on collaborations in that range, but it's tough to predict what that impact will be at this early stage..

And then definitely appreciate the color on the longer sales cycle with diagnostic products. But you guys have talked about seeing a significant uptick and usage in revenue call it two quarters after your approval.

Can you just talk about your expectations there? Any change of approval has been granted in late May? And then just the early feedback has that impacted your expectation at all?.

It has not yet confirmed our expectations, and it's still early. But, no, we would expect Q3. We would expect to see an uptick, especially in the United States with closing accounts. And that would turn into revenue commencing in any meaningful way in Q4 and Q1. And that’s consistent with what our expectation has been..

Our next question comes from Soumit Roy with JonesTrading. Please go ahead..

Just to understand, is there any progress made towards making any protocol changes for the hospitals to incorporate make this like you mentioned it would be irresponsible not to use this.

So has there been any move that part?.

We are definitely engaged in early discussions in that regard. And I would say most of the accounts that are deep in the pipeline, those discussions are occurring. But it's very early. Our expectation is that and our likelihood when the product is adopted, the internal protocol, probably, will be not significantly modified.

They are going to, probably, roll it out in the emergency department and, perhaps change protocols there. And then overtime, getting embedded in the protocol as the impact of the product is really better appreciated and understood within the hospital..

Do you have any -- like a timeline in mind? How long these things process takes for a protocol amendment?.

Yes, I’d rather -- we definitely have a timeline in mind, but I’d rather give a little bit more information under our belt before we start talking about specific timeline..

[Operator Instructions] And our next question comes from Mark Massaro with Canaccord Genuity. Please go ahead..

This is Max Masucci on for Mark. I know it's hard to comment beyond 2018, but post Bacteria approval, you've set a goal that double your revenues in '19 and '20. Let's contemplate roughly $20 million to $24 million in '19 and $40 million to $48 million in '20 versus your at least $50 million on this call. I know it's a small $2 million delta.

But is there any reason to think that these expectations have changed given what appears to be strong early attraction?.

No, the expectations are the same. You are right. We go to $24 million to $48 million. We have stated when we gave that guidance -- the same guidance we have said we expected to double one and to get to $50 million by 2020. So we're not changing those out your guidance.

And so really we're guiding to slightly better than doubling over the next few years..

And we saw a nice progress in proposals at $20 million in the quarter.

Does that number reflect large dollars as customers are excited about Bacteria? Just lover to get a sense of the pacing and how quickly you think they can be converted?.

Yes, it's definitely the increase is driven by Bacteria, there is no question about. We believe we will convert the number of -- hopefully a significant number of these proposals this quarter and then we keep us on the track to get to the $20 million to $25 million into replacement from the second half of the year.

And overtime, we believe that we will close a majority of the proposals that ultimately go out the door..

And then one more if I can. We appreciate this full year guide. I would love to better understand the pacing of revenues in the back half of the year.

Is it reasonable to think that Q4 revenues might trend above Q3?.

Yes, I think, that's a really phase that we would expect to see more of a contribution from T2Bacteria in Q4 than Q3 specifically. And to continue see the kind of quarter-over-quarter growth we've seen in T2Candida. So for sure, we would expect to see an uptick from Q3 to Q4..

Our next question comes from Paul Knight with Janney Montgomery. Please go ahead..

Hey John, could you kind of outline your -- the Canon collaboration was $1.3 million milestone.

What was that milestone for? And then again go over the line timeline?.

Yes, so the milestone was related to entering the FDA pivotal trial, which was replaced in May and that triggered a milestone payment from Canon. The actually payment was slightly larger than the revenue recognized and as of captaincy revenue recognition trying not to figure out.

And then in terms of where we are at with line we commenced the pivotal trial in May. We expect that pivotal trial to go through the 2019 line season. And we're hopeful to get to an FDA submission in 2019 like we -- in the back half of the year..

And then regarding Bacteria, you see -- your product guidance is up a bit.

You do see some lines -- is it tests or instruments from Bacteria in 3Q and 4Q this year?.

Yes, so in 4Q -- in Q3, we would expect to see a nominal amount of Bacteria disposable sales. And we figure out 6 in the fourth quarter. In the instrument sales, we continue to -- say we expect about 85% of the instrument placement for the U.S. to be regional rentals.

As we look at the pipeline, its trending a little bit better than that from a pipeline standpoint, but not enough change to want to change that expectation. But the uptick we expect to see in instrument placement in the second half of the year is primarily being driven by T2Bacteria.

So the instrument sales, the placements on regional rentals, I think it's safe to say, certainly in the U.S. probably 90% of those placements are being driven by interest in T2Bacteria. Outside the U.S. it's probably more of a 50-50 proposition..

Our next question comes from Lee Chan [ph] with H.C. Wainwright. Please go ahead..

This is Julian on for Lee. Just on the quarter, heart center medical systems to be T2Bacteria panel were up presented steadily.

Any early thoughts on why sensitivity was much higher in this study compared to the pivotal file?.

It would be speculation, so it's tough to know what's driving it. But the study at [indiscernible] was exclusively, as I understand, is being driven by screening patients suspected with sepsis.

We are in the pivotal trial; we got a mix of patients who are suspected with sepsis or perhaps have been treated sepsis -- couple of days into the sepsis protocol. And so the sensitivity could have been impacting for reasons of that type.

But having said that even with T2Candida, we typically see sensitivities that range almost always of 90%, sometimes you get really high in the 90s, sometime you get lower and it's tough to know what the factors are that actually drive that..

[technical difficulty].

I’m sorry. You are breaking up a little bit. So we can't quite hear the question..

Sure.

Can you hear me now?.

Yes..

My question is when are you guys [technical difficulty] the ICU setting with the T2Bacteria panel?.

We would expect to be in the ICU setting right away. About maybe two primary drivers in our hospital and there are more that it's primarily emergency department and then the ICU, and so many of these accounts initially are going to be launching in the ICU. I’m sorry you are breaking up again..

Our next question comes from Steve Brozak with WBB. Please go ahead..

The way we modeled it with T2 is that there are three parts to what you're doing in terms of adding the bacterial panel to fungal panel. The first part involves the hospital system.

So what I’d like to ask is with the hospital system, with the clinician and eventually with the patient and in terms of their, not just outcome but their general experience, it's too early ask about that.

But what can you tell us in this much color about the hospital systems, the differences, the advantages that you see and then also with the clinician? And then I have got one follow-up question after that please..

Yes, could you repeat that again?.

You've got advantages in terms of the institution of the T2Bacteria panel.

And in terms of how the hospital systems look at and evaluate, what the differences that you are seeing and that you think that you'll see into the future? And then also with the clinicians, what are the differences that they'll provide you with the distinct advantages as to what shall be see into the future? And again, will you also look at it as the advantage for patients -- off course patient outcomes and then patient experience? But it's too early to ask about that..

Yes, that's a great question, Steve. The big advantage here which cut across all over including the patients experience is getting the rapid results, which would, let's see now, if a patient has an infection getting the patient on the right targeted therapy, and if negative, being able to know you don’t have one of these infections.

In other words, at our National Sales Meeting last week, we have a sepsis survivor of patients speak to the sales force, and this is a patient who survived sort of an infection that would detected by a T2Bacteria panel, and couldn’t made a big difference in the life.

I mean it has been -- I mean, she's survived, but she has an ongoing infection, she has to be tested monthly. It has created financial move-in over a 3-year period, for their family, the people, and her husband not being able to work, just a really horrible story. And she -- we're probably out of here, more from her e in the future.

But she would benefit tremendously and just trying to get our product brought into the hospital, big hospital system that differentially miss an infection, because she has to go in through the tested because she is at risk of this infection flaring up. And it's just the way 5-days on the blood culture could know that she doesn’t have an infection.

And so when you talk about a patient experience, if you could run the T2Bacteria panel on her, three hours later she could go home and sleep knowing that all is well and she can kind of continue on with the life. So there are certain uses of our product in so many ways that can make a big difference in the lives of patients.

We had so many situations that now we continually hear about young children, adults, who are being impacted, we've seen a lot with Candida and were now starting to see with the Bacteria panel. And it's just a tremendous opportunity for us and a tremendous obligation for us to get this technology into the hospital..

And the follow-up is along with same line since one of the areas that obviously is considered high risk or the oncology applications where you have to really know what should patients is before you take the next step in terms of administration of therapeutics? What can you tell us about what's your feedback has been there? And I'll jump back in a queue..

Yes, in fact one of the accounts that closed in the second quarter, Steve, is the large oncology center that would be using T2Bacteria to screen all of their patients. They purchased an instrument; they made a very, very large commitment to an annual testing volume. And it's all because the cancer patients, their immune systems are compromised.

When they spike fevers of unknown origin they need to be tested. And they should be tested, and if positive, obviously, the central hospital going to be admitted. So there's a big opportunity there. We talk a lot about the emergency department; we talk about the ICU, the next very large group of oncology patients..

This concludes our question-and-answer session. I’d like to turn the conference back over to management for any closing remarks..

Thank you, operator. I’d like to thank you all for dialing in. We are excited to be into the launch of T2Bacteria. We are excited for the second half of 2018 and into 2019, and look forward to reporting back to you next quarter..

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