Transcript Q3
Anne Marie Fields - LHA, Investor Relations
Dr. Phillip Frost - Chairman and CEO
Steve Rubin - Executive Vice President
Adam Logal - Chief Financial Officer
Charlie Bishop - CEO, Renal Division
Analysts
Dana Flanders - JPMorgan
Brandon Couillard - Jefferies
Rohit Vanjani - Oppenheimer
Kevin DeGeeter - Ladenburg
Yale Jen - Laidlaw
Presentation
Operator
Welcome to the OPKO Health Third Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following management’s prepared remarks we will hold a Q&A session. [Operator Instructions]
As a reminder, this conference is being recorded, November 9, 2015. I would now like to turn the conference over to Anne Marie Fields. Please go ahead, ma’am.
Anne Marie Fields
Thank you. Thank you and good afternoon. Before we begin, I'd like to remind you that any statements made during this call which are historical will be considered forward-looking, and as such will be subject to risk and uncertainties, which could materially affect the company’s expected results, including without limitation the various risks described in the company’s annual report on Form 10-K for the year ended December 31, 2014, and its subsequent filings with the SEC.
I'd like to discuss the format for today's call. Dr. Phillip Frost will provide brief opening remarks, followed by Steve Rubin, OPKO’s Executive Vice President, who will provide an update on the company’s business operations, followed by Adam Logal, OPKO’s Chief Financial Officer, who will review the financial results and then Dr. Frost will follow with closing remarks, after which they are here to answer any questions you might have.
I would now like to turn the call to Dr. Phillip Frost, Chairman and CEO of OPKO Health. Dr. Frost?
Dr. Phillip Frost
Good afternoon. And thank you for joining the OPKO third quarter review conference call. During the quarter we closed on the acquisition of Bio-Reference Laboratories, which is important from the strategic point of view as it gives the infrastructure to perform market and sell important diagnostic test on a large scale.
This will help us achieve the greatest possible use of the 4Kscore test to diagnose prostate cancer more rapidly. As you will hear from the financial perspective, our results will be impacted by this acquisition in a significantly positive way.
On another front, our work with the Pfizer team on the next-generation growth hormone project is progressing as are our other proprietary pharmaceutical projects, all of which have been carefully selected because of their potential commercial importance, as well as the novelty and usefulness for physicians and patients. Our company is moving forward as planned and we have every reason to be more than optimistic about our future.
I now turn you over to Steve Rubin to provide more detail and then to Adam Logal for a financial summary.
Steve Rubin
Thank you, Phil, and thank you all of you for joining us this afternoon. As Phil highlighted, the third quarter of 2015 was a transformational time for OPKO in our mission to truly become a diversified biotechnology and drug discovery health care company.
Our acquisition of Bio-Reference Laboratories has significantly enhance our financial position and has given us a leadership position in the Diagnostics business, while also providing critical strategic assets we can leverage in both genomics, as well as in reaching providers of all kinds. We also made significant progress on our important clinical programs during this quarter.
Starting with our existing initiatives, let me touch upon our progress with Rayaldee for prevention and treatment secondary hyperparathyroidism in patients with stage 3 or 4 chronic kidney disease and vitamin D insufficiency.
In July the FDA accepted our NDA submission and as you know, we have a March 29, 2016 PDUFA date. We are initiating certain pre-commercial activities, we are meeting payors for development and reimbursement strategies, and we are preparing for key hires and sales force build out as commercialization nears.
There were several data presentations at the recent American Society of Nephrology Kidney Week in San Diego. The presented data showed that plasma levels of intact parathyroid hormone continue to fall as serum levels of 25-hydroxyvitamin D rose above 30-nanogram per mL, which is a level considered sufficient for CKD patients.
These data suggest that patients with stage 3 or 4 CKD acquire higher levels of serum 25 D than previously thought to control elevated parathyroid hormone. Increased levels of serum 25 D are infrequently achieved with currently available therapies and this will serve to further differentiate us from other agents contemplate in the market.
Our drug VARUBI, a substance P/neurokinin-1 receptor antagonist for the prevention of chemotherapy induced nausea and vomiting is nearing commercialization by our partner Tesaro.
Tesaro’s NDA was approved by the FDA in September 2013 and we will receive a $50 million milestone upon U.S. commercial launch and are eligible for an additional $95 million in milestone based on regulatory and commercial sales milestones. In addition, there are tiered double-digit royalties on net sales in the U.S. and Europe.
In addition, we made significant advances with our long-acting human growth hormone product hGH-CTP, which has partnered worldwide with Pfizer. We completed enrollment of Phase 3 clinical trial in adults in late June. Our study is on track to complete the 12-month efficacy time point by early August 2016. Topline results are expected by Q4 of 2016 and [POH] [ph] preparation by Pfizer has been initiated.
We also present a complete efficacy data for all patients participating in our Phase 2 pediatric hGH-CTP clinical trial at the European Society for Paediatric Endocrinology early October.
The data confirms similar 12-month high-velocity efficacy results and a safety profile as compared to daily growth hormone treatment. Data also demonstrate a comparable antibody occurrence similar to daily growth hormone with no neutralized antibodies.
Phase 3 pediatric study is on schedule to initiating in the middle of next year, using a multi-dose disposable easy-to-use pen device with a thin needle and low injection volume. We are also aiming to initiate a bridging pediatric Phase 2/3 study in Japan in parallel to the global Phase 3 study.
Turning now to progress with some of our other biological products, in late June, we had five papers presented at International Society of Thrombosis and Haemostasis on the preclinical activity of our Factor VIIa-CTP, which is a long-acting next-generation therapy for the treatment of patients with hemophilia.
Data showed that Factor VIIa-CTP compared with commercial Factor VII demonstrated longer half-life, less bleeding and longer survival. Our U.S.-based Phase 2 has initiated and is on track our first-to-manage injection later this month.
The estimated study duration for this study is approximately one year. We plan to commence a Phase 1 study using a subcutaneous administration during the second half of 2016.
We are also looking forward to advancing our long-acting subcutaneous oxyntomodulin for the once weekly treatment of obesity in type II diabetes. Preclinical data showed our compound reduce food consumption and body weight and lead to improvements in glycemic control and lipid profile.
Pharmacokinetic study showed an extended biological half-life in comparisons to native oxyntomodulin. All the toxicological studies supported the initiation of first in human study has been successfully completed. We expect to commence a Phase 1 study in Q1 of 2016.
During the third quarter, we completed our acquisition of Bio-Reference Laboratories and our current financial results include data from the acquisition beginning August 21, 2015. I think the strategy behind the acquisition of Bio-Reference want some mention.
OPKO is a drug discovery and developmental biotechnology company. Since our inception, it has been our mission not only to discover new assets but also to leverage existing ones and we still maximize value for shareholders while improving patient care.
The acquisition of Bio-Reference is strategic since it allows us to fully leverage our capabilities while simultaneously addressing the need for changing healthcare landscape. We believe that there are four major trends we need to address in diagnostics today. Number one, providers including health systems, hospitals and physician groups of all nature and size, will be taking on more responsibility for the overall well-being of their patient and we need to be provider centric if we have to remain relevant in this scenario.
Genomics will become increasingly important not only as a diagnostic tool but understanding basic disease processes. The scope of genetic testing offered throughout the Bio-Reference Enterprise is impressive.
Three, we need to find ways to promote commercial collaboration in order to leverage our unique position and promote the development of new therapeutics by connecting providers and patients with our genomic capabilities. And finally number four, we view the laboratory today as a distribution center to introduce new diagnostics to provide us on a large-scale basis cooperation and support from all payors and key opinion leaders in their specific field. Such is the case with our 4Kscore Test, which we believe is truly important program.
Ultimately we see the merger of OPKO and Bio-Reference as an opportunity to thrive as a nexus of diagnostics and therapeutics. This may take many forms, working with pharmaceutical companies as the means to connect them to patients and providers towards the development of novel and new therapeutics, allowing providers to maximize value of their own outpatient laboratory services or facilitating the needs of providers with regard to enabling their own precision medicine initiative.
However, nowhere is the synergy of this merger more demonstrable than in marketing the capabilities of our 4Kscore Test to identify and differentiate patients in a noninvasive manner to those that may progress to aggressive prostate cancer. There's never been an algorithm-base test that’s been better study than the 4Kscore Test.
By combining the new capabilities of 4Kscore with clinical laboratory expertise, the outstanding skills in marketing capability and managed care contracts with Bio-Reference, OPKO has the potential bringing the disruptive diagnostics to the market, one that is not only cost-effective to the health system but promotes better, more compassionate care to individual patients.
Progress has been made with practitioners as well as with payors as we seek new reimbursement coverage for this important test. Due to multiple peer-reviewed clinical studies and support of key opinion leaders in neurology and prostate cancer, 4Kscore has not been included in the National Comprehensive Cancer Network Guidelines.
In July, we filed -- presented to the Pathology Coding Caucus, an advisory group with AMA CPT Editorial Board and to the AMA CPT Editorial Board itself, an application for category one, CPT code for our 4Kscore test. The PCC advisory group recommended the issuance of a category one CPT code 4Kscore and we expect a formal response from the AMA CPT Editorial Board any day.
The category one approval would recognize that 4Kscore has established diagnostic test that addresses an important unmet medical need. The NCCN panel determined that the 4Kscore has a blood test with greater specificity over the PSA test. It is indicated for use prior to first prostate biopsy or after a negative biopsy, to assist patients and physicians in further defining the probability of high-grade cancer.
This is important as your identification in selective treatment of aggressive cancers should result in significant decreases in morbidity and mortality or limiting adverse effects on quality-of-life. In addition, 4Kscore can help avoid an unnecessary biopsy altogether and the adverse event such as pain, bleeding and infection that could arise from biopsies.
In a recent clinical utility study, 4Kscore has been shown to affect the decision proceed to prostate biopsy in up to 85% of cases and in one study it showed that prostate biopsies could be reduced by 60%. A recent health economic study that we have prepared confirm that the use of 4Kscore could lead to greater than 35% savings on the cost of prostate biopsy get properly utilized by payors. Not to mention the benefit of better patient care in less procedural complications.
This is a critical initiative. 4Kscore is only part of our commitment to the continuum of prostate care that could combine accessible diagnostics with meaningful therapeutics. As part of this continuum, Claros-1, our point-of-care platform that offer cost-effective and accessible PSA testing continues to progress.
As preclinical analytical stability studies are underway and we expect to commence clinical studies in early 2016. We’ve also successfully demonstrated feasibility for release and analytical performance for our testosterone assay on the Claros-1 device. Regulatory approval pathways have been discussed and agreed with FDA.
So with the acquisition of Bio-Reference Laboratories and the unique assets as well as the advancement of our existing initiatives and ongoing commercial collaboration, we are extremely positive about our future. Over the final months of this year, we expect to achieve a number of additional value-creating milestone that should position us but continue commercial and clinical progress as we move into 2016.
Thank you. And I’ll turn this over to Adam Logal, our CFO, to review the financial highlights for the quarter.
Adam Logal
Thank you, Steve and good afternoon everyone. During the quarter ended September 30, 2015, as Phil and Steve mentioned we saw significant improvement of our financial performance compared to the 2014 period.
Revenue increased to $143 million from $20 million and net income for the three months ended was $128.2 million compared to a loss of $48.7 million for the comparable period of 2014. Income for the 2015 period benefited significantly from $93 million of income tax benefit as we expect to offset Bio-Reference’s future taxable income against our historical losses in research and development credits.
Further during the quarter, we see consolidating SciVac’s financial results with OPKO as a result of SciVac merger with Levon Resources Limited, resulting in a non-cash non-recurring $17 million gain. We also recorded non-cash income related to the change in fair value of our derivative instruments of $32.2 million during the 2015 period.
Our operating loss for the quarter decreased by approximately $40 million to $8.2 million compared to the 2014 period. There were several items that resulted in this improvement. Importantly, the activity related to our Pfizer transaction and acquisitions of Bio-Reference and EirGen had the most significant impact.
Our R&D spending for the 2015 quarter was $1.5 million less than 2014 period as a result of the timing of certain manufacturing activities for our biologic programs. During the 2014 period, operating income was negatively impacted by $19.5 million of consideration expense incurred in connection with our Rayaldee development program as compared to $1.6 million for the 2015 period.
This decrease was partially offset by increased amortization of intangible assets related to our Bio-Reference and EirGen acquisition, as well as the capitalization of the VARUBI-related intangible asset upon FDA approval in September 2015.
Turning to the nine months ended September 2015, revenue increased to $215.5 million from $65.6 million for the comparable period of 2014 and net loss decreased to $31.6 million for the 2015 period, compared to $118.7 million for the 2014 period. This improvement was principally the result of the $87.2 million income tax benefit as a result of the Bio-Reference acquisition, as well as the positive impact from our Pfizer transaction and the acquisitions of Bio-Reference, partially offset by the OCS payment related to the Pfizer transaction.
As we announced last week, we entered into a $175 million credit facility with JPMorgan Chase, which provides us with an ability to leverage the Bio-Reference balance sheet in a more cost-efficient and covenant like manner. With this credit facility and our cash position of $212 million, we believe our balance sheet is in a very strong position to fund our ongoing development program and support the continued ramp-up for the 4Kscore and the commercial launch of Rayaldee.
I would like to turn the call back to Dr. Frost. Phil?
Dr. Phillip Frost
Thank you. I will just now turn the floor open to questions.
Question-and-Answer Session
Operator
[Operator Instructions] Your first question comes from Dana Flanders from JPMorgan.
Dana Flanders
Hi. Thank you for the questions. I have just a couple here. So, first, can you just talk about the integration of a BRL and salesforce and how that is progressing? Is that progressing kind of inline with expectations, and at what point do you expect that salesforce to be kind of fully ramped on the OPKO products?
Two, on the 4Kscore, now that you have the administrative code and a billing for price, can you just update us on the progress you're making with reimbursement, and are there any timelines that you can share where you expect to see improvement there and that translate into a meaningful ramp in sales?
And then thirdly, and I know you mentioned this in your prepared remarks, but just the latest on the commercial strategy for Rayaldee, how do you see this product being used between stage III and IV patients and the message particularly evolving around secondary hyperparathyroidism and vitamin D insufficiency? I know you mentioned that you think there's a higher serum 25D level in patients. So what's the right level in your view and how much education is going to be needed for the physician base and is that something you are ready to address? Thank you.
Steve Rubin
Okay. Thanks, Dana. This is Steve Rubin. I will take the first couple and actually have Charlie Bishop next so he can help on the Rayaldee one. So integration is going very well. As you recall, we have had a very small salesforce dedicated to our pathology lab as well as 4Kscore, primary focused on urology. BRLI has a very significant salesforce with sales and marketing of almost 400-people, but not necessary a major focus group in urology. So they've been working together since or the after, we acquired the company at the end of August and the Bio-Reference Lab Group has taken over by the management of sales process altogether. So integration is going very well. Certainly after we get reimbursement, we settled and we expect to roll it out even to the primary physicians, and right now it's a combination of primary focus with urologists with some groups in the primary care.
For reimbursement, obviously getting the weighing here from level one CPT and that should happen any day, at least it would be published. Once we have that, we expect reimbursement to really ramp up. So the number of physicians that are using the test has grown significantly. So once the reimbursement is in place, which we expect call within the next six months or so, we should have a lot more visibility into a more reimbursement, so we get them pretty much everyday. We will get a new provider, but the lion’s share will come we believe after the CPT code is in place and we can start discussing with Medicare as well. So call it around the six-month plus time, so I want to see some more visibility into that.
Dr. Phillip Frost
Just to give a tiny bit more detail there, our salesforce covering the 4Kscore test mainly neurologists as Steve said consisted of eight to 10 people and initially Bio-Reference plans to use a 100 of their 400 salesmen to promote the test and not only to the urologists but now as Steve indicated to primary care physicians. And this salesforce has been in the training process over the last several weeks and that process will continue and probably will be prepared to go to work and mass about January 1 at about the same when we hope to have a significantly greater number of payors onboard. So that should work out well.
We started the process very slowly with maybe four or five tests a day and now we’re going with only eight or 10 salesmen at the rate of approximately 100 a day in the U.S. So you can see it’s been ramping up very, very nicely and where you need to be and reason to be optimistic that this will dramatically expand as the reimbursement kicks in and as the salesforce gets to work. And eventually, there is no reason not to use as many as 200, 300, 400 of the salesmen on the test because it certainly is going to be coming as we anticipate at least a profit center. And I think Charlie Bishop is here to respond to your question about the Rayaldee.
Charlie Bishop
Hi, Dana. You asked about the right level of 25-hydroxy D for patient with either stage III or IV chronic kidney disease and we had a presentation at the ASA meeting just last week on this topic. As you undoubtedly know, the current clinical practice guidelines which had been issued by the National Kidney Foundation or by the Endocrine Society state that 25-hydroxy D level should be at 30 nanograms per ml for this patient population.
But our clinical data collected during Phase 3 trials with Rayaldee indicate that the proper level of 25-hydroxy D for CKD patient should be higher, in fact substantially higher and these data are consistent with recent publications that are pointing to the same conclusion.
When you look at commercial strategy, these data are very important for us because there are no currently available products that can reliably raise 25-hydroxy D levels in the blood of a patient with Stage 3 or 4 CKD to the levels that are required for excellent control of secondary hyperparathyroidism.
Dana Flanders
Great. Thank you.
Operator
Our next question is from Brandon Couillard from Jefferies.
Brandon Couillard
Thanks. Good afternoon. Phil, just back on the 4Kscore test. I believe you said a run rate, a volume run rate currently of about 100 tests a day. Could you give us sense of how many neurologists have now used the test and any statistics you have around reorder rates?
Phil Frost
I think the number is just under 2,000 neurologists and I don’t have precise information on the reuse rate. If were to guess, I would say somewhere in the 50% range.
Brandon Couillard
So then just one for Adam. Could you break out the contribution from Bio Reference in terms of revenue in the period, if you could speak to the core volume growth of the business baseline that would be helpful? And then any clarity or could you discuss the potential impact of the PAMA ruling on sort of the out year rev for Bio-Reference exposure?
Adam Logal
So, Brandon, with the out year revenue on PAMA, I think what I can say to that is Bio-Reference’s historical Medicare revenue was been about 16% of their total revenue, a decrease from 18% to 16%, I think this year maybe they were on a run rate of about 15%. So it’s becoming a less important overall piece of the pie. And as PAMA goes, I don’t -- we are not sure the exact impact. We don’t expect a dramatic impact on the overall growth rates for the business. So for Bio-Reference’s revenue for the period, they contributed approximately $102 million for the quarter. That just reflects the post-acquisition revenue.
Phil Frost
And just to give you a little more color on the 4K test in your question, I think that the reused level of the neurologists would be very high, almost 100%, much for the fact that there was limited access to reimbursement and that was an ongoing issue. So, we are confident that once the reimbursement issue is taking care of, that it will become a regular part of the practice.
Brandon Couillard
Super. Thank you.
Operator
Our next question is from Rohit Vanjani from Oppenheimer.
Rohit Vanjani
Afternoon, gentlemen. Thanks for taking the questions. So, Steve, I think you said that you are expecting a formal response from the AMA Editorial Board any day. Did you already have that -- you had that meeting on the Category 1 applications and that’s why you were saying that you are expecting a formal response from that meeting?
Phil Frost
We did. We had a meeting, Rohit and also their own kind of Advisory Comm recommended if you adopted. So, nothing is for certain but we feel very confident. And we honestly expect it to be out by Friday, it wasn’t out yet so. The very next publication and while the CPT goes and whenever that comes out, which should be really any day we fully expect to be on there.
Rohit Vanjani
And so -- but wouldn’t it get published not until 2018, it won’t be in 2016, right? It will take a couple years before it actually publishes.
Phil Frost
Yeah. If they publish now -- but it won’t be effective until January 1 of 2017. So even though as you probably now, you can start once it decodes there and to recognize by the AMA as a level 1, you use that to start your negotiations with CMS and for Medicare, as well as other providers. We’ve already discussed with our providers and try to get a price. In fact, you can start using -- we will continue to build under our existing Category 3 code. But we will begin with a capture once we set a price long before the January 2017 date. But that’s the two effective date of the code. So it will be published we expect this week.
Rohit Vanjani
Okay. And so the commercial players, they have said it they are waiting for the Category 1 labeling or you just kind of know that they will?
Phil Frost
No, we’ve had a few, if you have seen announcements here and there from a few and we continue to negotiate and more will get added every day. Certainly, it is helpful because it’s a validation. So once we’ve been in front of, if factors do not happen, we need to publish our economic study, which I eluded to health economics and shows that it’s a win-win. So when you think of your payor why would you not cover this test because the choice is good to go to something much more expensive, either NOI or biopsy versus our simple blood test. So, you kind of ask yourselves why wouldn’t you cover this. So those conversations will be accelerating because some people need a formal third-party validation but it’s not a gating factor.
Rohit Vanjani
Okay.
Phil Frost
Another strategic brands I would say Bio-Reference acquisition because they have a group of nine people whose job is to deal with reimbursement whereas we had one.
Rohit Vanjani
Yeah. That was actually going to be my next question. Have you found having BOR there and their suite of products? Has that helped in the negotiations instead of having just one product to negotiate with, I guess?
Phil Frost
It is two things. Remember, they have contracts with almost every provider in the country and so really it becomes a conversation at this test to suite of products. So, yes, an indirect answer it does help. They have already done the equipment of most of the producers.
Rohit Vanjani
Okay. And then last one for me is that are you still seeing double-digit volume growth every month in 4Kscore?
Phil Frost
We are.
Rohit Vanjani
Okay. Okay. Great. Thanks for taking the questions.
Phil Frost
Yeah.
Operator
Your first question comes from the line of Kevin DeGeeter with Ladenburg.
Kevin DeGeeter
Hey guys. Thank you for taking my questions. Just one or two for me. Charlie, can you comment on sort of the initial profile for the target, the clinician population for the launch of Rayaldee and how we should think about segmentation of the market in general?
Charlie Bishop
Hi, Kevin. We are going to be targeting with our sales force on nephrologists and endocrinologists to care for patients with Stage 3 and Stage 4, chronic kidney disease. And that breaks down to about 5,000 to 5,500 nephrologists to maybe 1,500 endocrinologists.
Kevin DeGeeter
And in terms of the initial kind of called them QRA accounts or those, can you talk a little bit about just generally speaking how we should think about the profile, as we begin to think about your potentially year one build out of revenue?
Phil Frost
No, good question. Our build out of the sales force will be progressive over time as we get more and more formularies -- on Rayaldee more and more formularies. And we will initially start out with a salesforce. It’s about one third of the ultimate size and that salesforce will be calling on specifically identified physicians, endocrinologists or nephrologist that they are known to be rapid adopters and who also have larger practices. From there, we’ll branch out.
Kevin DeGeeter
Great. And then maybe one more for me. Steve, can you just try an update on the incremental steps to kickoff Phase 3 pediatric human growth hormone program?
Steve Rubin
Most of it is driven around CMC issues. Those are in Pfizer stands. I guess even CMC is probably mostly device related. Though we need -- we have selected -- Pfizer has selected device that device will be as we mentioned before, we’re going to start the Phase 3 trial using the pen device. So once that is ready and drug product is ready, we’ll commence the trial.
Kevin DeGeeter
Great. Thanks.
Operator
Our final question comes from Yale Jen of Laidlaw.
Yale Jen
Good afternoon. And thanks for taking the question. The first one I have is that about a drug development. In terms of the Factor VII Phase 2 study. Could you give us a little bit more color in terms of maybe study design and maybe timeline for the data release -- applying data release?
Steve Rubin
So it will be about a one-year trial. It’s a dose ranging study. We’re expecting forward doses, start to finish, we expect that it will be about a year. We’ll announce results probably in three to six month after that.
Yale Jen
So that will be some time into 2017.
Steve Rubin
Correct.
Yale Jen
Okay. I’m sorry,
Steve Rubin
No, to actually your first administration demand later this month and then depending how well we do recruiting, it will be announced to one year, about a year we expect.
Yale Jen
Okay. Great. Thanks. That’s helpful. The second one is that we know that Bio-Reference has a strong genomic asset, and so I know you got -- they have reason and you have a collaboration or study with Vanderbilt University. But beyond that, are there any efforts try to eventually monetize this asset or maybe in what a way or manner for that?
Steve Rubin
Sure. So it depends, it’s monetized now to some degree just to you know the genetic screening portion of Bio-Reference Lab is a very expensive and profitable part of their business. And accumulated, you talk about how to monetize accumulated data, yes we expect to enter into more contracts, stay tuned, some of which will have a revenue component to them to use some of the data, that’s been collected. But keep in mind, that part of the business, which is high throughput secret screening is a very significant portion of the business today.
Yale Jen
Okay. My last question is that, would you guys be able to provide some guidance in terms of the Bio-Reference in terms of their revenue growth in 2016, would that be a little bit flat or maybe a several percentage points compared to this year? Thanks.
Steve Rubin
So, Yale, as of now, we’re not providing any forward-looking guidance on Bio-Reference’s performance. I think, previously Bio-Reference had guided on theirs and we don’t necessarily commenting on that. But I think that should give you a fairly high level of view of the way they see the business and we don’t necessarily see it differently from them.
Yale Jen
Okay. Thanks a lot. Appreciate it.
Steve Rubin
Okay.
Dr. Phillip Frost
I think that maybe the last question. I’ll finished by just mentioning that there is one other project that we have not yet mentioned and I don’t want you to think that its that we dropped it to the contrary and that’s the product oxyntomodulin for weight loss and type II diabetes. We are planning now to start our first human trials, which should begin in the very near future and as you'll recall this is a product for which I have great hope because it’s a naturally occurring product that we produce and got response to a meal and Society Center to make you feel for and to delivered to the glucagons-1 like receptor to help control sugar metabolism. So this is potentially a very important product and for me personally its one that I’m particularly enthusiastic about. So we’ll close on that note and thank you all for participating. And we look forward to bring and touch with you at the next meeting.
Operator
This conclude today's conference call. You may now disconnect.
