Barry Weiner - President, Chief Financial Officer, Principal Accounting Officer and Director James O'Brien - Executive Vice President, Finance David Goldberg - General Manager, Enzo Clinical Labs and Vice President, Corporate Development.

Bill Bonello - Craig-Hallum Norman Hale - Stifel Pat Gallagher - Laidlaw & Company.

Good morning, and welcome to the Enzo Biochem Inc. first quarter 2016 operating results conference call. I will now read the company's Safe Harbor statement.

Except for historical information, the matters discussed in this news release may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended.

Such statements include declarations regarding the intent, belief or current expectations of the company and its management, including those related to cash flow, gross margins, revenues and expenses are dependent on a number of factors outside of the control of the company, including, inter alia, the markets for the company's products and services, cost of goods and services, other expenses, government regulations, litigations and general business conditions.

See risk factors in the company's Form 10-K for the fiscal year ended July 31, 2015. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties that could materially affect actual results.

The company disclaims any obligation to update any forward-looking statement as a result of developments occurring after the date of this press release. During this conference call, the company may refer to EBITDA, a non-GAAP measure.

EBITDA is not and should not be considered an alternative to net loss, loss from operations or any other measure for determining operating performance. The company has provided a reconciliation of the difference to GAAP on its website, www.enzo.com and in the press release issued last night. Our speaker today is Barry Weiner, President.

At this time, all participants have been placed on listen-only mode and the floor will be opened for questions and comments following the presentation. I would now like to turn the floor over to your host. Mr. Weiner, the floor is yours..

Thank you. Good morning and thank you for joining us today. On the call with me are Jim O'Brien, our Executive Vice President of Finance; and David Goldberg, our Vice President of Corporate Development. We issued our 2016 first quarter press release last night and it has been uploaded to our website.

Our results continue to demonstrate the operational strength of our business and how we are delivering against the corporate strategy that we have laid out in detail, but before getting into the numbers, I'd like to take a minute and discuss why this is such an exciting time for Enzo.

First and foremost, our vertically integrated structure and strategy, which represents the combination of years of extensive planning and execution have positioned us for growth in this current environment. Enzo, today, has the unique ability to offer low-cost, high-performance products and services in the molecular diagnostic sector.

We believe, this allows us to capitalize on the growing reimbursement pressures facing diagnostic labs, and it is a key competitive advantage for us relative to the rest of the industry moving forward. I will discuss this a bit more, a little bit later in the comments.

Additionally, Enzo's technology and IP platform stands as one of the most valuable in the industry, and serves as the foundation upon which the company's platforms and products are built. This includes an extensive pipeline of new molecular diagnostic assays. We have had significant success litigating to protect our patents when they are fringed upon.

And in fact, over the past five years, we have received more than $53 million in settlement in licensing revenue, more than double our total legal spend in the same period. However, the most exciting story is our proprietary molecular testing pipeline.

In a key recent development, last month New York State approved Enzo's AmpiProbe-HCV assay for the detection of hepatitis C, clearing the way for Enzo to immediately begin offering this assay to the market.

This is the first in a series of products, a pipeline of products, that we are developing to address the critical needs of the molecular diagnostics market and it serves as the foundation of Enzo's unique business strategy and structure.

Enzo is currently leveraging its IP and proprietary technologies to develop other molecular diagnostic assays in order to expand the company's product offerings and address an estimated total market opportunity in excess of $2 billion.

Our goal is to develop high-performing molecular diagnostic products and services that will provide substantial savings to current market prices. We believe that this is extremely timely given the current market dynamics. The cost of these assays are and have remained high-end on yielding, while reimbursements continue to decline.

The result is that many clinical service providers have been enduring shrinking margins to where for many, their viability may be threatened. Additionally, we are designing our molecular solutions to fit seamlessly in our customers' current workflow.

This means that they are designed to work on instrumentation that is commonly available in many clinical laboratories, and thus requires little or no new equipment, capital expenditures, or changes to their operating protocols.

We believe that when you consider these factors in aggregate, the result is a business that is poised to create significant value for our shareholders. Accordingly, and as you can see from today's earnings release, our business is strong.

Our balance sheet is also strong with over $30 million in cash and cash equivalents on hand in the October quarter. This will allow us to accelerate our product development programs.

Additionally, the quarter's results reflect the many steps we have taken to meet the needs of today's demanding and fast moving clinical markets, and especially the increasing benefits realized from our ongoing strategic program integrating Life Sciences and Clinical Labs into a streamline development engine.

This has given us the best of both possible worlds, a developmental and skilled global manufacturing and marketing unit that is combined with practical knowledge and application of world-class diagnostic surfaces. Our organization is highly nimble and can now develop and commercialize new molecular diagnostic content at a unique rate.

Notably, all of our development projects start with an eye towards what the market actually needs and what fits into the existing workflows at an attractive cost to the user. We are very pleased with our first quarter results. In the quarter, revenues increased to $25.2 million from $24.8 million.

This included a solid 8% year-over-year increase in clinical laboratory services. The gross margin in the lab rose to 40%, a 400 basis point improvement over the prior-year period, as we focused on marketing and providing high value molecular testing surfaces.

Additionally, we have continued to invest in our expanded translational diagnostics capability to provide a seamless flow from the product development to validation. Life Sciences product revenues were off about 4% for the quarter from the prior-year period, almost all of this due to foreign currency headwinds.

Enzo Life Sciences also encountered softer European demand, where economies remained weak. Nonetheless, by keeping its costs in line, Life Sciences remained profitable on an operating basis. And on a product-only basis, gross margin remained constant year-over-year.

Royalty and licensing fee income is reported on a separate line, as you may know, though included in the Life Sciences' overall results. Sales of licensed products on which these royalties are primarily based have been declining on a global basis. As a result, our royalty income declined by $600,000 for the period.

Consolidated margins improved to 45% compared to 44% in the year-ago period. Our cost of goods sold was only slightly higher in the current quarter compared to prior year, even with the 8% increase in Clinical Lab testing services. This is due to the Lab's improving profit margin.

Once again this quarter both operating units, the Clinical Lab and Life Sciences were each profitable and cash flow positive. Importantly, operating expenses are well-controlled and remain at constant level sequentially and from the prior year.

Legal expenses in the current quarter were lower both sequentially and versus the prior year, despite the fact that we have a total of 11 ongoing litigations. Our investment in protecting both our intellectual and contractual rights continues to vary, depending on the level of legal activity in ongoing matters per quarter.

Net income was $4.6 million compared to a net loss of $3.7 million last year. This year's GAAP results benefited from the legal settlement recorded in the period. EBITDA improved to $5.5 million and again was largely attributed to the legal settlement noted.

On a non-GAAP basis, which is adjusted for legal settlements as well as certainly related legal fees and compensation factors, the net loss was $2.4 million for the quarter as compared to a year ago loss of $3.7 million, an improvement of $1.3 million despite a decline of $600,000 in royalty income.

Cash generated by operations in the quarter amounted to $13.2 million, again reflecting solid performance of the operating segments and cash received from settlements.

During the quarter, we also invested over $500,000 in capital in information technology solutions, new diagnostic instrumentation and other capital expenditures related to developmental projects designed to enhance capabilities and also to promote profitability.

Cash and cash equivalents as previously stated were over $30 million at the end of October 2015 and working capital was $27 million. As you can see, we ended the quarter with a very strong balance sheet, which will provide Enzo the ability to continue to invest in growing its core business in molecular diagnostics.

Clearly, we have made and are making significant progress, and we are looking forward to further assay validations based on our AmpiProbe platform. Our pipeline from this platform encompasses a number of products, designed to address both the women's health market as well as other infectious diseases.

Our other platforms are also yielding pipelines to serve other markets such as cancer, immunology and cardiology, to name a few. I would like to suggest, you visit our company's website, www.enzo.com, where under the heading of Corporate, you will find that our latest corporate strategy and overview presentation.

It's spelled out in great detail, the challenges facing the industry and the opportunities that are bound for Enzo and also provides detail on the product pipelines I just referred to.

We have positioned Enzo, using our vertically integrated structure to be an innovator in molecular diagnostics, mainly a provider of cost conscious, highly effective and technologically leading assays and tests.

Our biotech effort is developing innovations, which lead to technology and platform development as well as continuing to both expand and strengthen our intellectual property portfolio.

Our product development teams with our MDx effort are actively developing, formatting and manufacturing high-performance products on a large scale, based on our proprietary platforms.

And our clinical services capabilities are providing us with multiple channels to the market regionally, nationally and ultimately globally, allowing us to very efficiently commercialize these high value diagnostic assays, when they will be introduced. These strengths differentiate and open another important way.

Namely in today's competitive market environment, there are numerous biotech molecular diagnostic and clinical services companies. What they lack typically is the structural integration, necessary operating structure or resources to effectively provide solutions to the challenges caused by the changing dynamics of the industry.

Vertical integration allows us to eliminate a broad array of costs, and these savings are past along to the market. Downward reimbursement pressures on labs are likely to persist for the foreseeable future, which seems like a very compelling opportunity for us. Our technology and our IT portfolio are providing us with a major advantage.

Because we have self-generated our innovations, we do not carry the excessive burden of royalty costs that many face. Moreover, our company now has the capacity built up over the years to seamlessly and rapidly move from concept to commercialization. This requires an innovative culture combined with a strong technology position.

It also requires the ability to develop in that numerous platforms to have manufacturing capability, and an in-house ability to validate technology as well as deliver quality products and services. Few of any companies can match our integrated approach.

Our structure is designed to enable us to deliver cost effective, high performance, easily adaptable products and services. If we look back, molecular diagnostics has grown from a market size of approximately $10 million in 1990 to more than $5.2 billion worldwide market today.

The market by the way is estimated to grow at about 7.5% annually into the future. However, this growth is tempered by the marginal decline from third-party payers that will be exacerbated by the implementation of the Protecting Access to Medicare Act or known as PAMA, which will likely further impact reimbursement beginning in 2017.

This is where Enzo comes in. In addition to providing, what we believe could be a 30% to 50% savings to the market and certain products and services. We also will provide high performing and easily adaptable solutions that will allow our customers to utilize them with little or no change to their normal workflow.

In summary, I'd like to emphasize that our synergistic strategy and integrated structure address a number of challenges in today's marketplace. We believe that we had that assets and capabilities to engineer a system that can generate products based on the attributes discussed.

Additionally, Enzo has been able to design proprietary products and protocols that are in lock step with current market operations without a need to utilize third-party intellectual property. It is our firm belief that to build the infrastructure, we have developed, would take millions of dollars in a very long time to recreate.

And as such, we feel that Enzo is uniquely positioned to meet the current market challenges. Given that we have already put the foundation in place, we are starting to some real operating leverage in clinical services as well as our business as a whole, which we expect to continue.

Our proprietary molecular diagnostic content is also just now being commercialized and most of the cost have been incurred that shareholder should benefit from the fruits of these development efforts, as we continue to execute on our pipeline.

Lastly, our long history of defending our vast IP estate has been paying dividends and our pending discussion may yield additional benefits. With these reasons and more, we are extremely excited about the company's prospects, as we move into the future. On this note, I would like to turn the floor over to questions..

[Operator Instructions] Our first question comes from the line of Bill Bonello with Craig-Hallum..

Couple of follow-up questions this morning. So you've had some very nice success both in the core business and on the legal front, and obviously your balance sheet is beefed up significantly. You've talked about that balance sheet putting you in the position to execute on a growth strategy.

Can you maybe give us some sense of your expectations or intentions or sort of operating spend and capital investment over the next couple of years to what degree we might expect increased expenditures? And how we might think about how much of that cash balance gets invested back into the business in the near term that would be helpful?.

We have a fairly aggressive pipeline in front of us, right now. Basically, we put forward two platform products, one is the HPV product and the HCV viral load, which we anticipate will start generating revenues in the middle of January. What's in front of us is very key.

We are looking to introduce a women’s health panel which will include upwards of 14 different detecting analytes in it, many of them are in various levels of development at the moment. We are looking to invest more behind this.

We have already beefed up our sales organization and anticipation of the first approval, and as we see more emerging over the next year, so we have made a larger investment in our marketing organization. We will be driving our research organization as we move forward as well.

I am not prepared to give you specific numbers on growth in our research budget at this point in time, but we do anticipate additions that will have value as we move forward in terms of the scientific organization.

Our integration with the Clinical Laboratory is serving us certain economies as we're able to capture some of the skill sets that are present in the Clinical Lab and use them to integrate into the overall structure of our R&D organizations. So some of the cost structure of building and driving these products is amortized over the whole organization.

But I believe you, you will see upwards of a perhaps 20%, 30% increase in R&D budget spending over the next year..

And maybe to come at that question a different way, you probably are going to continue to collect cash from future settlements going forward.

What do you sort of think you need to hang on to, to have a reasonable level of comfort to fund your growth? And what’s sort of the threshold at which you might look at ways of returning some of that cash to shareholders via either share repurchase or special dividend or something along that line?.

It's a little premature to anticipate what the future will bring until it happens, but. But certainly we have had dialog and have had discussions over the utility of our cash needs. We certainly should be spending more money than we are to drive the number of platforms that our AmpiProbe system will accommodate.

We've been relatively conservative in the approach to date. We are looking at the needs as we speak interestingly enough. Certainly, we would consider all options in terms of the utility of our cash. We certainly have no disagreement or obstacle to returning cash to shareholders if once we hit a certain threshold.

We are looking at different opportunities. As a company, we're very fortunate in that. We have an infrastructure today that is extremely expandable from the perspective of marketing capability, manufacturing capability, and distribution capability. We are looking at options to be able to capitalize on that infrastructure.

Some of it might include additional product throughput developed externally to us. Some of it might include activity in which we partner with other parties to drive the significance of our resources and gain revenue flow from it.

But we certainly would not put away the thought of returning to shareholders or buying back shares at a certain point in time if our cash reserves give us sufficient capital to do such..

And just as a follow-up to that, what about M&A? Is that on your radar screen at all?.

We have multiple opportunities in front of us, but we're trying to be very discerning. The channels of distribution that we have built are extremely valuable in our industry today.

Our reach in the Clinical Laboratory market is expanding and becoming more valuable, as we grow our business and define ourselves as a leading lab, particularly in the women's health market in our regional area. And as we look to expand that on a national footprint as a reference laboratory proving low cost services to other labs.

So we are, in many respects, the portal through which many companies who have existing product would like to transfer through loads and basically utilize us as a logistical support.

That being said, there are many opportunities that we could potentially develop, but we must focus, first, on getting our core businesses humming with new product introductions and getting our own established products into the market. So M&A activity is certainly in our vision.

But we, with the recent approval of AmpiProbe now have the ability to go out and get these products into the market and we are focusing on that initially. But we certainly would not shy way from any opportunity that would be accretive, that would be able to expand our footprint and grow our business base..

And then, if I can, just one on certainly the product revenue, the growth has been down year-over-year for the past four quarters. I think even if we strip out the currency hit, the growth probably doesn't seem especially robust.

I'm wondering if you would expect to generate some AmpiProbe product revenue this year, and maybe some sense of your objectives and expectations for product growth over the next year and maybe next one to three years..

We have been realigning our Life Sciences business. We have been morphing the strategic direction from the Life Sciences products to the clinical diagnostic sector. This realignment entailed us to take a close look at our product mix.

It moved us to evaluate our manufacturing operations, so that we can ensure the capacity to introduce the higher margin products that are coming through the pipeline. We've spoken in the past how we marginalized many of our products that were acquired in the earlier days of building our channel business that were of low margin contribution.

That thing said, we continue to realign our product mix at Life Sciences. And that is part of the reason you see the leveling of revenues in that business and drive the marginal return from our overall product mix in a much more directed way. We believe that we are seeing the bottoming of our product line sales activities.

We will be looking to drive now with new products, particularly other platforms and it's more than just AmpiProbe.

We have a number of new product platforms in the immunoassay area that we're trying to put forth and target towards the marketplace that we think has the most crying need and that's the clinical laboratory marketplace as a result of reduced reimbursement directions here. So we have been realigning our product mix.

We've been expanding and enhancing our marketing and sales organization. We have been building, and I would say, cleaning our manufacturing operation to provide capacity for what we hope will be a new product introduction that will be of high margin. So in a sense, there has been a real morphing of this business over the last two years.

And that is part of the reason you're seeing this sort of leveling of our sales revenues -- actually decreasing of our sales revenues, as we've rid ourselves of or low margin products. We do anticipate growth in that business as we start to introduce new products. It's difficult for me at this point to give you any specifics on the numbers though..

Our next question comes from the line of Norman Hale with Stifel..

Well, first of all, congratulations on the AmpiProbe approval for HCV. That's definitely great news. On that particular subject, relative to HCV, that product has really geared up.

I don't know what the time period would be before you guys really are starting to get the sales up to what you think is the potential for the product? But what sort of revenue level would you guys anticipate the product could be producing, say, four months from now?.

HCV in and of itself is a singular product that will have impact on the margins within our own clinical laboratory. We have just begun to do the missionary work to start educating the market to the product for utility by other clinical laboratories.

The real value proposition of HCV will emerge when it is packaged with the panel of complementary test that will go alongside it, which will be HIV and HPV. And those are anticipated to be available sometime at the end of next year, the early of 2017, that's when you'll start to see the real revenue for thrust from the viral load panel.

In the interim, we do anticipate beginning to see the introduction of various analytes in the women's health panel, which will be begin to be introduced over the next year. And again, the full thrust of that value will come from the introduction of a panel that has multiple analytes in it.

It is a very desirable product that we think will have extremely high value into the marketplace, both from a cost structure, as well as utilization, and in practices approach. So it's difficult to really pin the market for the HCV product, in and of itself it is really the first product that was a proof-of-concept in principle for our platform.

Interestingly, it is one of the most difficult of diagnostic analytes to get an approval for. That is part of the reason we chose that as the bellwether approval with the hope and belief that subsequent analytes emerging will have a much more rapid approval state than the HPV.

It did take us quite a long time to get that through the system, because of the inherent complexities of the HCV virus. So I'm reticent to give you any determinants on numbers at this point in time. But over the year as we start to see the products emerge, we will have a better handle on the mix and the viability.

Certainly, all of these will have immediate return in our own clinical laboratory as we provide services for our own cliental as well as potentially as a reference service for other laboratories.

And in the Life Sciences area, we are just now beginning to get the message out, not only in the United States, but in Europe as well, to our sales operations in Europe, to build the base for the ultimate introduction of these panels in the coming year..

The lengthy period of time that took AmpiProbe to get approved -- now that that product is approved, and you have just mentioned, you expect the timetable to be quite a bit quicker, I mean is it feasible that in the calendar year 2016 that the HIV, the HPV products, that potentially both of those could receive approval in 2016?.

Again, I would refer you to presentation that we posted online, which I think is a very thorough and comprehensive presentation, which gives you the pipeline and some expected availability dates of the products that we have in development right now, and on that you will see that we do expect availability of some of the women's health panel markers, as well as cardiac and fertility assays during 2016.

So you will definitely be able to get a better understanding of the throughput as well as the opportunity if you take a look at that presentation..

I'll definitely do that.

For these various products, do to the margins vary or are they fairly similar? I mean, what I'm saying, the potential products that you guys are currently working on the women's health, the HPV, HIV, are they all that equal or is there any differentiation between the different products?.

I'll let David Goldberg respond to that..

The margins here, obviously, will vary to some extent based on the complexities of the product, but understand that these are very, very high margin products for us for several reasons. First and foremost, if you look at most molecular diagnostic products that are on the market, they come with somewhat onerous royalty stacks.

And those prices or those costs have to be passed on to the end user. We don't have any of that, because as you know, if you've been following us for a long time, we have self-generated all of our intellectual property. And that's a very significant cost savings that we can pass on.

The second piece is that we do all of our manufacturing and product development in-house, and that also allows us to pass those savings on. And finally, as you know from various talks, we will have a bifurcated channel-to-market, so that we would be able to market both services as well as products.

And so again, we'll be to pass those synergistic savings from marketing on to our customers, so these will be quite high. I'm a little bit reticent to give specific numbers on actual margins, but these would be substantially higher margin products than you would normally see from other sources..

So I would imagine that going forward as these new products are approved and introduced, that potentially some of the lower margin products may be phased out. And then you guys will concentrate on the newer products, which would have better margins.

Is that a fair statement?.

That is absolutely correct. And that the strategy has actually been employed over the last year-and-a-half as called through our product lines and discontinued many of the lower margin products here. For a company our size, we have a significant number of SKUs that we've tempted to pair down.

We try to create capacity for the new diagnostic activities that are coming through. And I think that's really what has reflected in much of the performance of the Life Sciences division, as we speak, when you look at the revenue sort of leveling off and having sort of constant level..

And I know in some of the previous discussions, you have mentioned that you're pursuing or having discussions with some other companies in terms of joint ventures, is that gaining some momentum?.

We have dialogue continuously, and certainly, with the approval of AmpiProbe, that has given us a very interesting product to discuss with other parties at this point in time. So we are actively engaged in dialogue. We also are a company that is very fortunate that we have so much technology wealth.

We have today no less than five or six platforms from which we are able to drive products. We're only limited by our size and scale at this point in time. We're trying to address it and certainly we will be able to address it better as our capital structure improves.

But we have products in the area of immunoassay or flow cytometry, as well as DNA and RNA amplification that we believe can have significant significance, because they also target the same challenge and dynamic of the marketplace, which has reduced reimbursement and low margin for entities providing services.

So we are absolutely focusing on looking at multiple product entries. As I mentioned to you earlier, two of the three products that we think will emerge in this coming year are based on our enhanced immunoassay platform. So we have a lot on our plate of opportunity, and we're driving very hard to bring them to market right now..

I think you guys are doing a really good job in terms of these initiatives, finally getting AmpiProbe approved obviously, is a big game changer. If we move into 2016, and I don't know what sort of legal settlements you guys are anticipating.

But let's assume, we get some more money from some legal settlements, and maybe the cash position of the company is $50 million, $60 million.

I know you mentioned earlier that you might consider share repurchases or some kind of a dividend or things of that nature, but just in terms of where you would put that money to work from a operational standpoint? Are you going to beef up the sales and marketing? Are you going to beef up the research division? Where would that money go to work most effectively?.

The most effective use of capital organizationally right now will be to drive the research operation. The more platforms we can get approved in the most rapid timeframe will drive revenue growth for us, and so that is a major focus.

We have already begun the transformation of our sales operation to high value diagnostic capabilities from, I would call, the routine Life Sciences products. So now that in a sense that the horse is out of the gate, we have the capability to build the stable, and that's exactly what we're going to do..

Our next question comes from the line of Pat Gallagher with Laidlaw & Company..

Barry, in your discussion you had mention that Labs are under considerable pressure, and yet your margins continue to improve quarter-over-quarter, have been doing so.

And we know that part of that's mix and part of that's efficiencies, but maybe you can talk a little bit about what the drivers are specifically? And how you see that continuing over the next, make it up, year or two?.

That's really an excellent question. As you could see from this quarter, and the quarter prior, our margins are continuing to grow in the Clinical Labs, which is in many ways the antithesis of what the industry model has shown.

And for us, this has been the return on an effort that has been ongoing over the last few years to morph the clinical services operation to a more dynamic, esoteric and molecular testing entity.

The margin improvement, I think, as David commented in some of his remarks just a few minutes ago, it's really driven by the unique structure that we have been able to put together in terms of combining the skills and sets that are inherent in our Life Sciences division that have been developed over many years that give us strong conceptual development capabilities, very strong manufacturing capabilities, as well translational capabilities.

So what I mean by translational, I mean taking these concepts and brining them from product format to services or clinical diagnostic format. This unique structure truly has given us an edge in this marketplace. And it's come at absolutely the right time.

So we believe that when you look at the marginal return that the Lab is starting to demonstrate, and again, when you look at average margins in the Clinical Labs sector, I mean you're talking 35%, 38%, we've now surpassed that.

And we believe that we still have room to drive value in that area, as we bring across these products that we are have internally or vertically integrated or manufactured into our own operation.

We believe the success of Clinical Labs from a marginal return capability will be based on their ability to integrate, develop and manufacture their own reagent systems and tests. The cost structure when you look at the industry as a whole the kit manufactures have not met the challenge, have not reduced the pricing structure.

The absorption of cost containment has being truly absorbed by the service providers. We hope to address that problem, and I hope that will continue to drive the margins in our own lab, as we morph into not only a very strong regional lab, but as a reference lab for other labs around the country. And that is really the goal.

As we look to provide our services as a low cost solution to laboratories that confront it with this constricting margin pressure on a daily basis..

And there appear to be no further questions at this time. I would like to turn the floor back over to Mr. Weiner for any additional or closing remarks. End of Q&A.

Thank you for joining us this morning. As I mentioned, I believe we're at a pivotal point in the company's history today. We're very, very excited about the directions that are unfolding for us. We look forward to the second quarter results.

Hopefully, we will have some more elucidating information that we can share with you about our product introductions, as well as the strategic direction of the company. Thank you..

A replay of this broadcast will be available until Tuesday, December 22 at 12:00 midnight. You may access this replay by dialing 1-800-585-8367. The PIN number is 93174150. This replay is also available over the internet at www.enzo.com. This concludes today's teleconference. You may disconnect your lines at this time and have a wonderful day..