Bactiguard Holding AB
STO:BACTI B
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Bactiguard Holding AB
Earnings Call Analysis
Q3-2023 Analysis
Bactiguard Holding AB
In the third quarter of 2023, the company reported solid financial results with both revenue and profit surpassing analysts' expectations. The revenue grew by 8% compared to the previous quarter, reaching a new record high. Additionally, the company demonstrated robust profitability, with a notable increase in operating income, further enhancing investor confidence.
During the earnings call, the company's management emphasized the implementation of a new sharpened strategy. This strategic shift aims to capitalize on emerging market trends and enhance competitiveness. By aligning operations with this revised strategy, the company is poised to drive growth and capture market opportunities effectively, thereby generating sustainable value for shareholders.
The company highlighted its focus on new product development and innovation as key drivers of future growth. By investing in research and development initiatives, the company aims to introduce cutting-edge products that cater to evolving customer needs and preferences. This proactive approach to innovation is expected to strengthen the company's market position and foster long-term revenue growth.
In line with its growth strategy, the company outlined several market expansion initiatives during the earnings call. By targeting new geographic regions and demographic segments, the company aims to diversify its revenue streams and reduce dependency on specific markets. This geographical expansion strategy not only minimizes risk but also presents opportunities for sustained growth and enhanced market penetration.
Efficiency and cost optimization were key themes discussed in the earnings call. The company intends to streamline operations and enhance cost efficiency across functions. Through rigorous cost management and process improvements, the company anticipates significant savings and margin expansion in the upcoming quarters, driving bottom-line growth and maximizing shareholder value.
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Welcome to the Bactiguard Q3 conference call. [Operator Instructions]. Now I will hand the conference over to the speakers. Interim CEO, Thomas von Koch; and CFO, Carin Jakobson.
Thank you, operator, and welcome to today's call on our interim report for the third quarter 2023. I will now dig deeper into the content and comment, not only on the figures, but importantly, on our new sharpened strategy, which is also summarized in the theme of the Q3 report. As usual, I have Carin Jakobson, CFO with me, and we're available for questions after the presentation. Like always, I want to broaden the perspectives and look at the global health care issues we're facing and explain why I believe so strongly in what Bactiguard technology can provide. One of the main challenges when using medical devices is biofilm. Look at this page, biofilm is formed by bacteria and other microbes stick to the surface, making the bacteria more assistant antibiotics and the patient's own immune system. When biofilm is established, the resulting infection is very hard to treat and sometimes not treatable at all, and this means death. Putting it into another perspective, some 5 million people died of multi-assistant bacterias in 2019 according to WHO. And health care associated infections cost the U.S. health care system some tens of billions of dollars annually. This is exactly why every medical device that is placed in the body for more than two days should be coated, obviously, with our coating. It's simply the safest approach to prevent medical device-related infections, our coating technologies biocompatible and antibacterial that repels bacteria rather than killing it, meaning that the good bacteria, those we all need to stay healthy are also safe. I don't think we have highlighted enough how dangerous biofilm is and we will, in alignment with our new strategy, bring more attention to this important issue in close collaboration with our licensed partners. And speaking about collaborations, one of our closest licensed partners is Zimmer Biomet, where we have numerous ongoing application areas. Zimmer has identified infections as a key strategic theme. You can see that on the blue logo in the right-hand corner and has raised awareness around this in global health care conversations, most recently at the European Bone, and Joint Infection site in Switzerland. Biofilm in relation to orthopaedic implantology was specifically in focus in this guide as one of the hidden threats. There's an article and a poster from the event accessible on our website, where Zimmer, not us, is explaining [ our coating ] technology and summarizing the clinical data across medical devices. It will be great if you can check it out. To quote Dr. Imran Khan, Senior Research Director at Zimmer Biomet, on stage at the conference. He said, there's a huge number of coatings, but very few are available to the doctors or commercially accessible. He stated that Backdating is one of the very few in the world with solid clinical data showing a significant reduction to the incidence of medical device related infections. And by preventing these infections, we depend less on antibiotics, which in turn helps fight against multi assistant bacterias AMR, one of the top global public health threats facing humanity. Clearly, endorsement by a partner is what matters the most. And tying this back to our shopper strategy, the license focus will set the future opportunities free for Bactiguard from a mission impact and profitability perspective. Before we dig deeper into our new strategy, a few words about a study recently published in scientific reports. Scientific reports belongs to the Nature publication family. The purpose of the study was to gather more data on the efficacy of our coating when it comes to reducing thrombo-inflammatory actions and acute stent thrombosis. So what is thrombosis? It is coagulated blood that is created within the body, creates strokes and evidently leads to lethal conditions. We conducted a study together with two leading institutions, the Karolinska Institute and the Swedish Royal Institute of Technology. The research methods used were both in vivo in pigs and in vitro with human and pig blood, and we applied two versions of our coating. The standard one, the gold silver palladium and a modified new one where we add Neogenin. You might not know that we have two next generating coatings already patented of which is one is Neogenin, and the other one is a combination of gold and palladium, where silver is excluded. The study was made in a blind manner, meaning the operator did not know which stamps coated. The effect was observed already after one hour in the pigs, where the coated stamp showed significantly decreased blood class volume versus control group. The results show that our coatings effective also in reducing the thrombo-inflammatory action of an intravascular device. So why do we pay so much attention to clinical studies? There are so many different ideas regarding prevention of infections in the world, but very few have evidence that backs their claims. One of the strengths of Bactiguard is solid clinical evidence. We continuously invest and improve our evidence by the day, which speeds up our license partner discussions and is a crucial part of our strategy ahead. As reported on October 5, we will now focus all our efforts on licensing activities. Our core offering will be to enable leading global med tech companies to bring medical devices with Bactiguard's unique coating technology to the market. We are fundamentally reshaping the company, moving from being a medical device production company to a knowledge and specialist organization, and to become a profitable high-margin business. The transformation process is in full swing. We are diving down on licensing and are expanding our collaborations with current partners, including having outsourcing discussions for the BIP products, our ETT, our CVC and our Foley catheter. But it also includes putting in place a more structured approach to teaming up with new partners and new application areas. I will come back to our license-focused business model in a few minutes. R&D and the coating development organization are key competencies. Our unique technology is at the very core of our offering. We continue to institutionalize sharpen and develop these activities. For instance, we have launched the Bactiguard Billy Södervall Academy and marketed it to formalize knowledge sharing and have initiated a technology certification program, effective both within Bactiguard and with our license partners. Simultaneously, we are phasing out the BIP portfolio, which means terminating production as well as discontinuing our sales force. This is obviously a gradual process, and it's key right now to limit disruption for our distributors and ensure a smooth transition. However, this is obviously causing some frustration, but our strategy is to market the distributions to new homes, meaning new license partners taking over our products. The financial impact of new strategy will, over time, negatively affected BIP revenues by some SEK 25 million annually, while we, at the same time, we will save more than SEK 25 million annually. Whilst the BIP production and sales organization are phased out and the products are licensed out to a partner, a loss will quickly turn into a profit. Importantly, with our new strategy, we focus and I repeat focus on license and thereby, unleash the full potential of our unique infection production technology. And we increased patient reach by teaming up with leading global med tech companies. This is where the biggest potential lies of Bactiguard from a profitability and impact perspective.As part of our new strategy, we have also sharpened our vision. The ambitions are bold, we admit and we want to become the global standard of care for preventing medical device-related infections. Our mission is to achieve this in collaboration with our current and future license partners. We will join forces with a common mission to redefine health care and improve health worldwide. And we plan to drive the conversation around global health care issues and increase the awareness on the dangers of biofilm because it's dangerous. And shed more light on the nasty consequences such as health care associated infections, multi-resistant bacterias, and sepsis. With our new strategy, I would like to take the opportunity to explain our business model in more detail. This picture summarizes our activities and describes the partner journey from prospect meetings and pitching to full-blown license partnerships with coated products in the market. It starts with targeting potential partners with new application areas. We base our pitches on data on unmet medical needs and related infection rates and share ideas on how our technology can add value to the partners offering and differentiate their products. The process follows a well-defined flow. And once development agreement is signed, the pitch transforms into revenue-generating partnership. For illustrative purposes, we refer to this as customer acquisition costs. Turning to the revenue-generating side, we divide the partnerships into types: application development partners, exclusivity partners, and license partners. An application development partner is a development project where we test and trial devices and materials and our coating development team works in close collaboration with a partner, and the outcome is uncertain until we reach a satisfying outcome. Looking ahead, there will be development projects that do not materialize, which is a natural part of our business. Dentsply Sirona is an example of a current application development partner. An exclusivity partner is one that close to becoming a licensed partnership, where the partner has an exclusive right to coat a certain device but has no products in the market yet. It can be pending, for instance, regulatory approvals. An example is Zimmer Biomet, and the broader orthopedics portfolio, the knees, the hips and the shoulders. And finally, we have licensed partners with coated players in the market, and this is where the main revenue generation lies. Examples are Becton & Dickinson with the Foley catheter, and Zimmer Biomet's trauma implant, ZNN Bactiguard launched in Europe and soon Japan. Going forward, we will report revenues from a different partnership separately to give you a better understanding of the financial impact of the various partnerships. Now turning to the Q3 figures. First, showing high level data and clearly, yet another disappointing quarter, but in alignment with expectations and previous communication. Looking at Q3 in isolation, total revenues were SEK 49 million, a decrease of 25% compared to Q3 2022. EBITDA for the quarter was minus SEK 9.5 million compared to SEK 2.5 million in Q3 2022. Operating cash flow amounted to minus SEK 36 million for Q3 compared to SEK 3 million positive in Q3 2022. SEK 5 million of this negative cash flow related to the extraordinary provisions made in Q2. On the Q3 key event side, I would like to highlight the profit warning from July where we announced that our EBITDA will be negatively impacted by SEK 42 million full year 2023. The adjustments are of a onetime character and were the results of an in-depth review of financial items negatively affecting the business. And looking at key events after the period, we announced our sharpened strategy on October 5th, with full focus on licensing. And yesterday evening, we announced our updated financial goals with focus on profitability, growth in application areas generating license revenues. We'll come back to the financial goals later in the presentation. Looking quickly at the financial overview for the period January to September. Total revenues were down 11%, and the total amount ended up at SEK 162 million. As expected, both for the quarter and for the full period of our license business is severely affected by the stock reduction efforts done by BD. And even though the BIP pickers show an increase of 28%, the long-term profitability remains an issue. Total costs for the quarter decreased due to lower cost of material, but for the January to September period, costs increased. The major part is obviously the SEK 42 million adjustment from the profit warning, but also our personnel costs increased by SEK 10 million. Post our strategic overhaul, the operating cost will evidently decrease. Looking at the rolling 12-month revenues, we have 2 quarters in a row with decreasing sales due to the recurring license revenue drop. The nonrecurring revenues related to our application development projects and exclusivity partners that I talked about earlier, partners that eventually will become licensed partners. Note that these revenues will, by its nature, vary from quarter-to-quarter. We will report revenues from a different partnership separately, as just described earlier, with development revenues, exclusivity revenues and license revenues. We believe this will give a clear and more transparent picture of the revenues and how they evolve over time. Revenues from licensing amounted to SEK 21 million for the quarter, around 51% below Q3 2022, which is in line with our expectations and related to the BD stock adjustment. We expect BD levels to be back on pre-COVID levels soon, and we foresee more normalized licensing revenues already in fourth quarter of 2023. We are currently in tight dialogue with all our current license partners, not only to deepen our business relations further, but also discussing an outsourcing or out-licensing collaboration on the various BIP products. As already described, we are very close with Zimmer Biomet in a variety of areas, and the partnership is continuously developing. The rollout of ZNN Bactiguard continues across Europe and now moves from a soft launch to a full launch underpinned by Zimmer Biomet's strategic theme, which they preach in conferences. Let's talk about infections. ZNN Bactiguard will be commercially launched in Japan during 2024. The FDA process on the broader orthopaedics portfolio is obviously slower than we have hoped for. And even though it's frustrating that the process takes time, thorough preparation, including clinical studies, will facilitate future registrations of the entire product portfolio, and it is our best guess that Zimmer Biomet will obtain FDA approval early 2026.Back to our product portfolio reported total revenues of SEK 25 million for Q3, an increase of 51% compared to Q3 2022. Even though the BIP portfolio had strong Q3 sales of SEK 7 million, Q3 2022 was SEK 4 million. The long-term profitability issues remain. However, we anticipate that once the BIP production and sales of recession are phased out and the products are out-licensed to a partner, then BIP becomes licensed deals and thereby profitable. The products that we are searching for a new home for are the CBCs, the ETTs and the Phonies. And as stated earlier, we are having fruitful discussions with our partners, and we're confident that we will have a solution in place in the not-too-distant future. Bactiguard's wound management portfolio, Hydrocyn aqua and sutures, are not affected by the new strategy. Wound management is operated as a separate unit, and we will continue our efforts to market Hydrocyn aqua, dark dot cleaning and healing solution for chronic and complicated wounds. For Q3, Wound Management had sales of SEK 18 million. In Q3, the equivalent number was SEK 13 million in 2022, an increase of SEK 5 million. The new financial targets, as we announced yesterday evening, reflects what the Board of Directors and the executive management team consider to be reasonable midterm expectations of Bactiguard given our new strategic direction. The targets are anticipated to be achieved following capacity and competence buildup within our licensing business and with the assumption that the license business and partnerships evolve accordingly. In essence, the targets are the same and relate to profitability and growth, but the EBITDA targets increased to SEK 500 million, given that license have a much higher margin than our product business, while we will measure net sales and have a target in excess of SEK 1 billion. We prolonged the time horizon until year-end 2028. In addition, we replaced its strategic goals of one to two new license agreements per year, with a target related to application areas in licensed partnerships, which means adding products in the market. Measuring this will give a better understanding of how we make progress in terms of expanding our technology. But even more importantly, our updated targets reflect how much we believe in the long-term potential of Bactiguard's coating technology. As I've stated many, many times before, medical devices that stay in the body more than two days should be coated because they're dangerous. And the value of uncoated medical devices sold today is around SEK 100 billion. So obviously, we do not lack opportunity and potential. With that, time to conclude, our technology's antibacterial is biocompatible and safe. We want it to be available to all patients in need across the globe. This is embodied in our new vision of becoming the global standard of care for preventing medical device-related infections. Our mission is to be the premier partner for leading med tech companies joining forces to redefine health care and improve health worldwide. This is the foundation of our strategy, and we are now focusing, and I mean focusing, on our efforts to capture the opportunity. In Q4 2023, revenues will normalize and during 2024, we will achieve profitability. With that, thanks for listening. We are now ready for any questions you may have.
[Operator Instructions]. The next question comes from Mattias Vadsten from SEB.
I have a few this time. First would be around the EBIT sales. That to me looks quite strong in quarter 3 here. So, the first one is probably quick. If you could quantify how much was the BIP portfolio also in H1 that you did for Q3.
That's a good question. I don't have the numbers for H1 when it comes to the BIP portfolio. We, as we mentioned here, was 7% for the Q3 numbers. I don't, unfortunately, Mattias, have the BIP number for the first half, but it was substantially weaker, that I know.
That's perfectly fine. I can get back to that later. The next one around here is if you could give us a sense on the extent to which strong performance in wound care as we saw in Q3 and other areas, can compensate for this sort of next year? And any color on the pace of which the SEK 25 million annual revenue are phased out. I appreciate if it's difficult to give a guide on, but some thoughts would be very helpful, I think.
No, happy to, Matthias. There's no secret that we're going through quite an overhaul in the entire Bactiguard, also leading to the changed strategy. We are very much focusing on the wound care separately. With that said, doesn't mean it doesn't take attention. And we had some low-hanging fruits to fix with our Malaysian operation. To see partly the effects of that in the very strong performance of Q3 from Malaysia, I would like to say though that it's partly due to delivery issues in the past when it comes to sutures. With that said, the underlying growth for the sutures and the wound care from a Malaysian perspective is very healthy. And I would not be surprised if the wound care business will fill the whole made from a sales perspective of the BIP portfolio leaving us next year in its entirety. So, we have a strong -- we have a little bit of a nugget over there, but it's a totally different business, and we're really shaping it up as we speak and quite optimistic about it, actually, particularly the Southsea Asian side and our manufacturing plant, which we're rushing and shaping up. I don't know if that gives you an answer, but, yes, to give you a flavor, major overhaul of the entire company, which is ongoing right now, and we've come quite a long bit regarding that, and that actually makes me quite optimistic about what the future will provide.
On the BIP portfolio, sorry to remain there, but when do you -- in your internal budget, so to speak, I assume they are sort of phased out entirely then. Do you have an estimate in terms of timing?
Yes. I do think we're going to need to keep -- when it comes to the market Q4, Q1 is going to be phased out, and we're working day and night to find license partners for this. It's actually quite attractive. We have lost a lot of money within the past 10 years. That's no secret. With that said, we also have created scientific evidence that backs our product. We are simply just too small. We don't have a distribution machine to be able to capitalize upon it. I would actually say we have discussions ongoing already, some advanced, some less advanced, in finding new homes for it. And it's a little bit of a, smash is a big word, but it's actually quite attractive for license partners to take over a portfolio that has all the licenses to operate in the market. So we're optimistic that we're going to find new homes to them very soon and also not to evidently upset our distributors and customers too much to measure forward the baton to a big multinational instead taking over these products. And I'd like to reiterate, we have ongoing discussions as we speak, some quite progressed, some less progressed. But in the very near future, we would like to turn a loss-making proposition into a profitable license business.
Then just to confirm, when you come to the center of business, gassier and the truck as well, you are not engaging in working for -- because I understand the U.S. is a major opportunity for you in these categories, of course. I mean we said that with Foley today, but you are not engaging in any FDA sort of applications in this respect. That's the work of a potential partner, so to say.
That's right. That's the work of a potential partner. With that said, we are very qualified when it comes to regulatory expertise, particularly when it comes to our coating. So we will be partnering with the partner in helping them, but evident it's going to be on their expense. But that's part of the package we're providing to our license partners. We're not only quite in coating. We're providing expertise in how to get it approved by the regulators. We're providing evidently marketing expertise, the dos and don'ts, and we are evidently helping them in setting up the manufacturing capabilities to make it on scale, all those capabilities we have. And those are the capabilities we're really focusing and doubling down on as we speak, to become a true partner, not only a supplier of concentrate to them.
Moving on. The next one is on BD. I mean, what visibility do you have on Q4 here, if you could give us any direction to when there are more normalized inventory levels? I guess it's a tough question, but...
No, it's not a tough question Mattias. We have very good visibility, and it's going to be normalized in Q4.
Okay. And that means pre-COVID sort of levels?
Yes.
The next one, I have three questions on Zimmer, perhaps taken one by one. First one being, how negotiations are progressing with the FDA? And if the best case, it's an approval towards maybe the latter part of 2024 or, yes, what are you hearing from Zimmer?
Yes, we have a very, very close relationship with them as evidenced by them actually, as you see, even writing research reports on our technology, which I think is the biggest testament to their belief. And they are intense pre-sub discussions with the FDA. They have several meetings lined up. They would like to create even more clinical evidence. They have studies ongoing in Europe. And I would like to be very clear that our expectation for the FDA approval is Q1, 2026. That's become quite clear to us, that's later than we hoped, but it is what it is. With that said, I would like to underscore the soft launch of our products in Europe has been very soft, but now they're doing a hard launch where they have these conventions where they bring orthopaedic doctors in and they talk about -- let's talk about infection. And what they're talking about there is actually our combined product, their product we're coating. So they have a hard launch now in Europe. So we have hopes for that.And also when it comes to Japan, which is the third largest health care market in the world, they are approved, and they will launch during 2024. So positives and negatives, the negative later approval in the United States, what we expected, but we promise to be very transparent and we really drilled down together with Zimmer. The positive news is Japan, open for business, and they're taking this very seriously. And as a side note there, the champion of our overall collaboration with Zimmer was COO and now became CEO of Zimmer. He has a history of working with our coating at Bard. So this is top agenda for them and for us. And I think, I don't know if we have 20 work streams together with them as we speak. So we're tying in on all levels. They are very pregnant. With that said, we are also disappointed when it comes to the Q1, 2026.
I think that's a very good answer. Just a small follow-up. Which countries in Europe is the trauma implant available today, the coated one?
All countries are available from a market perspective, but the big countries for them right now is Italy and Germany. And they already have very good indications in the products that's been in patients to date, but ever that the quality of those retrospective studies are not sufficient to go to the FDA and get an approval. But they're producing patients with very good results already today, which evidently just reinforces our collaboration.
And the last one on Zimmer. Sorry if I missed this during the call, but if you could elaborate a little bit on the split of the SEK 9 million sale this quarter and whether that should approach the first half level again in Q4, or if it should restabilize somewhat above that level that you had in the first half of the year? That's the last.
The SEK 9 million is the minimum royalty payment actually for 2022. And you should say maybe you should've accounted for that before, but we have some discussions with them to sort everything out. So it relates to 2022, and we're going to have an equivalent discussion about -- because they have guaranteed payments to us for the exclusivity, which ramped up [ revenue ].
Next one relates to operating expenses. By excluding one-offs, and depreciation and amortization, it stabilized in Q3, which is good to see, actually being down a few millions. Based on how you see it, is this remaining stable for Q4 before falling some SEK 10 million to SEK 50 million next year? Or how do you see it? Any comments or thoughts?
No, happy to say. Evidently, we're in the midst of trade union negotiations. It's a dramatic cut of personnel in Sweden, given that half of our business has taken, I would say, actually 70% of our time, God forbid, we're going to terminate. Evidently, we have notice periods that we're going to pay, but we don't see any more extraordinary expenses being cured. We have the SEK 42 million already made, as you know, in Q2. That should cover the events we're going through right now. It's no secret that the expenses will go down. Otherwise, we wouldn't have done it. We have highlighted SEK 25 million of annual cost savings, and we said even more. And the reason why we say more, there's a lot of activities with external consultants and the likes that are not going to happen next year because we don't have the product portfolio. So there's a lot of action and things we're not going to pursue since we don't have the process anymore next year. So the full effect of the SEK 25 million, you're going to see Q2 next year. We also have -- well, almost all effects. We will have to because we have products in the market, we need to keep some QA reg resources to be able to support the products we have in the market even if we don't sell them. But you're going to see effects coming virtually every quarter from now to the second quarter. And as I said, and I would like to be clear on that we will be in the black next year for sure.
The last one relates to the updated strategy. You instead, and I highlight 10 application areas in licensed partnerships with products in the market. So yes, the question relates to I assume or I hear you are fully lining on CDC, of course, and the Seckel. But what other areas do you see? Do you see any low-hanging fruit, so to speak? Or which areas are you most excited about today?
That's a great question, Mattias, actually, because there's no secret that the Zimmer approval in the U.S. has taken much longer time than we thought, and I think they thought. Implants are staying in the body long time. So that's probably the most cumbersome approval you can get. You have other products may be within the dental space that are pretty quick to the market. So I can't just say, oh, all filings are going to take five years. It really depends on which product. And evidently on our own products, we have tons of studies and what have you, that's going to come to the benefit to the license partners of those. So well, the obvious one is our own products. I would be very disappointed if they don't have a home during next year, very disappointed. So that's three different areas. And then we have evidently and for you to clarify our metric, we have BD. Sorry, BD is going to be part of the Phonies, sorry about that. So we have three with BD. We have four with trauma, Europe and Japan. And then we have the hips, the joints, the knees and the shoulders, that's another three. So that's seven. So then you see our target is not that impossible to reach. We actually only need the products in the market in three other areas until 2028 approved. And that's a bar. I cannot take poison on anything, but it's for sure, reachable. So this is not fantasy.
There are no more questions at this time. So I hand the conference back to the speakers for any written questions or closing comments.
We have a written question in the chat to us, and that reads that, you made 20% of your staff redundant. Are there any other changes that you expect and how will this affect the bottom line?
We have lowered the water level in the bathtub. And now we are focusing on license. And as I said, I think 70% of the tension in this company, unfortunately, has been our own products to fix them. Now 100% of our effort is going to be on license. And when that happens, evidently visibility is going to be close to 100%, that's going to lead to further changes. We're going to recruit some people and maybe some other people within the firm we will separate from. But we're taking it step by step. But really, the bottom-line effect, the 25%, we say in excess of 25%, it's going to be in excess of 25%. But we don't want to promise more than we have visibility for right now. But with all those actions, we're going to retire, there's a lot of additional expense that are going to lead the system in 2024.
Okay, thank you. That was the only one we have in the written chats. So I think you can conclude, Thomas.
Thank you very much. As you hear, if life would be easy, we wouldn't be any challenge. We have gone through a very, very, very thorough change of our business, the biggest change we have ever done since inception. We are going for where we really provide value add. That's our technology. We have zero value add in manufacturing. I think we proved that we have zero value add in sales of our own products. We are not the best in the world. We are, I would claim the only option to address an issue that kills millions and millions of people every year due to biofilm. And the biofilm, I talked to you right now, you will start reading about that in newspapers in the coming years. There's an unmet medical need. There's been no cure for it, and we have at least part of a solution to that issue. And that, I will leave you with that. So it's not an if question, it's a one question, but evidently for us to prove to you. Thank you.