Platform Enterprise Coverage Universe Pricing

Earnings Transcript Finder

Search Company

CYRX Q1 2017 Earnings Call Transcript

Executives: Todd Fromer - Managing Partner, KCSA Jerry Shelton - Chief Executive Officer Mark Sawicki - Chief Commercial Officer Robert Stefanovich - Chief Financial Officer

Analysts: David Holperin - Stifel Stephen Balinskas - Source Capital Group

Operator: Good day and welcome to the CryoPort Incorporated First Quarter Fiscal 2017 Results Conference Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Todd Fromer, Managing Partner of KCSA. Please go ahead, sir.

Todd Fromer: Thank you, operator. Good afternoon everyone and thank you for joining us today for CryoPort’s first quarter fiscal year 2017 conference call. Before we begin today, I would like to remind everyone that this conference call contains certain forward-looking statements. All statements that address operating performance, events or developments that we expect or anticipate to occur in the future are forward-looking statements. These forward-looking statements are based on management's beliefs and assumptions and not on information currently available to our management team. Our management believes these forward-looking statements are reasonable as and when made. However, you should not place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We do not undertake any obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results, events and developments to differ materially from our historical experiences and our present expectations or projections. These risks and uncertainties include but are not limited to those described in Item 1A risk factors and elsewhere in our annual report on Form 10-K and those described from time to time in other reports which we file with the Securities and Exchange Commission. For those of you that have dialed-in by phone, there’s a slide deck to accompanying these comments, which can be found on the Events page of the Investor Relations section of the company’s website, cryoport.com. With nothing further, I'd now like to turn the call over to Mr. Jerry Shelton, Chief Executive Officer of Cryoport. Jerry, the floor is yours.

Jerry Shelton: Thank you, Todd. Good afternoon, ladies and gentlemen. Thank you for joining us today. With me this afternoon is our Chief Commercial Officer, Dr. Mark Sawicki, who will later during this call give you further context for the growing biopharma market and our expanded role within it. And Robert Stefanovich, our Chief Financial Officer, who will present our financial results for the first quarter of fiscal year 2017. It’s only been a few weeks since we held our last earnings conference call, yet we continue to make meaningful progress to leverage fiscal year 2016’s momentum to secure additional revenue opportunities and build out our infrastructure for our exciting future. Throughout our first quarter of fiscal year 2017, we continued to ramp new business growth by securing new clients and by expanding with existing clients. Our year-over-year growth was driven by notable advances in our biopharma and reproductive medicine markets. Revenue growth in these markets reflects the success on our ongoing investments in sales and marketing for our dedicated teams that successfully increased brand recognition and reaffirmed our reputation as a best-in-class provider of cold chain logistics solutions. Our continuously expanding market share is also supported by our strengthen and offering of temperature controlled cold chain solutions and services, which now include Cryoport Biostorage, Cryoport Temperature Controlled Logistics consulting services and our revolutionary SmartPak II condition monitoring system. I will discuss each of these strategic initiatives in more detail later, but first I would like to give you an update on our sales and marketing strategy. Our core sales and marketing strategy is primarily focused on securing logistics agreements with biopharmaceutical companies in the United States and Europe. This involves logistics solutions for biologic commodities in support of pre-clinical and clinical trials. During approval due to each stages’ exacting beta requirements creates long-lead times as clinical trials advanced with our respective clients our revenue ramps. It does takes time and sometimes to our frustration it is non-reliably predictable as each stage of trial is beta driven. The increasing understanding of drug and therapy development in this evolving environment. We’re seeing evidence that our sales and marketing strategy is working. And we’re confident that it is advancing our long-term growth prospects on a solid basis. Supporting clinical trials contains embedded gains, which will be recognized as our clients progressed through clinical trial phases and looked successful ultimately reaching commercialization phase. As disclosed during our last quarterly call a few weeks ago reporting fiscal year 2016, we achieved a milestone at the end of June by negotiating and signing our first commercial agreement to provide logistic support for the manufacturer of a multi billion dollar drug commercially – that is a multi-billion dollar commercially launched biopharma products. In addition, during the first quarter of fiscal year 2017, we continued signing new accounts with groundbreaking life science companies. For the first quarter, this amounted to 28 new accounts.

, : As you could discern the number of trials we support continues to grow each and every quarter and on a risk adjusted basis represents a sizable portion of what we see as our embedded growth opportunity. From an overall company perspective, we reported policy trends and growth in both biopharma, reproductive health markets and we’re seeing signs of improvement in our animal health market. We believe that our revenue growth reported for the first quarter reflects the continuation of our growing traction and the success of our sales and marketing strategy to target agreements with major biopharmaceutical companies that have potential to significantly scale. We’re gaining market recognition and we’re becoming recognized for our competencies. We’re rapidly becoming the go-to partner for logistics serving biopharma. Our revenue for the first quarter of fiscal year 2017 was $1.9 million, an increase of 34%, or $1.5 million as compared to $1.4 million reported for the first quarter of fiscal year 2016. Mr. Stefanovich will provide more detail later during our call, but for now I would like to comment briefly on our revenue distribution by market. First, reproductive medicine. During the first quarter, we adjusted our marketing and laid the groundwork for recapturing our growth and reproductive medicine market. The resiliency of the U.S. demand for human reproductive services drove solid revenue growth of 11% year-over-year for the first quarter, despite changes in international regulation in some Asian countries. Our U.S. business actually tops 43% growth year-over-year while being offset by a 12% decline in the rest of the world market while also the previously mentioned, governmental restrictions relating to medical tourism. Secondly animal health, our revenue from animal health suffered primarily due to the slow down from one of our larger clients. In the first quarter of fiscal 2017, we experienced a 15% year-over-year decline. However, we view this as temporary and continued to see a significant opportunity for growth in the animal health market. In fact if we look at animal health revenue on a quarter to quarter basis, we actually increased revenue 8% over the fourth quarter of fiscal year 2016. Thirdly, biopharma. The biopharma market is the major driver of our growth and we expect a continued increase in new clients, clinical progressions and commercialization of programs. Our revenue growth for the first quarter was primarily driven by our expanding base of biopharma clients, of which CryoPort secured 28 new clients during the quarter. Biopharma accounts for the largest portion of our total revenue and is our fastest growing market. Our continued progress in signing new clients with groundbreaking life sciences companies and the world's foremost biopharmaceutical corporations positions us for further growth and continually validates our reputation as a best-in-class provider of reliable cold chain logistics solutions. Our market in biopharma is large giving us the opportunity to continue to demonstrate our ability to further strengthen our market position and secure increasing revenues. In response to market demand, we also rolled out several strategic initiatives during the quarter to accelerate future growth. You may remember that our last conference call a few weeks ago, we talked about CryoPort bio-storage, a service that will provide storage of biologic materials and eventually fulfillment services. A new integration capabilities to our CryoPort operating platform, which provides us the ability to manage the entire logistics process, beginning with order entry, paperwork generation, automated real-time monitoring, collection of vital information and continuing to full integration of storage fulfillment distribution scheduling logistics support and client systems to create centralized seamless singular data repositories providing the most comprehensive information about commodities during logistics process and fully supporting and enhancing comprehensive and vital chain of custody and chain of condition information. During the first quarter of fiscal year 2017, we also launched Cryoport Temperature Controlled Logistics Consulting Services to address cold chain advisory needs expressed by our clients. This new service addresses the demand created by the world-wide advances in cellular-based therapies, which are causing broad shifts and challenges for the life sciences industry and biopharma. Specifically, these new challenges include how to obtain property store and transport the growing number of new individualized temperature-sensitive therapies. Our clients know that improper temperature maintenance or temperature excursions during any portion of a logistics journey can adversely affect the viability of biologically based commodities quickly destroying tens of thousands or up to millions of dollars of irreplaceable life-saving materials. Consequently, we have identified a gap in the market for strategic global logistics planning for cryogenic cold-chain solutions in our fast growing life sciences market. As a globally recognized leader in cryogenic logistics solutions for the life sciences industry, we can tailor and assemble teams of experts with unique experience at developing customized, innovative solutions to address global cold chain logistics challenges on a holistic basis including bio-storage, fulfillment, distribution, and information strategies. Cryoport Temperature Controlled Logistics Consulting Services is now operational and under the direction of Ms. Tamie Joeckel, Senior Vice President of Client Services, Tamie’s 25 years of pharmaceutical industry experience including logistics having worked with companies such as AmerisourceBergen, McKesson, PAREXEL and Dohmen Life Sciences put her in a unique leadership position. Our many years of systems and logistics solutions development have put Cryoport in an excellent position to provide life sciences companies with a wealth of knowledge and best practices for cold chain logistics. Consequently, Cryoport’s Temperature Controlled Logistics Consulting Services is equipped to provide its clients with invaluable benefits and information, which is an integral part of any commercial launch discussion. Although we can’t forecast the financial impact for this new service precisely, we have discussed our new consulting practice with a number of life science companies and expect it will have a meaningful revenue impact over time. During the first quarter of fiscal year 2017, we also introduced SmartPak II Condition Monitoring System, which provides advanced real-time communication, including condition and location data for monitoring critical biological commodities and enhancing our core chain of condition and chain of custody information. The SmartPak II measures a variety of environmental variables and works in conjunction with the Cryoportal logistics management platform to provide comprehensive and seamless monitoring of commodity conditions in Cryoport Express shipper performance. We remain committed to staying ahead of the curve and proactively providing solutions to our clients in all markets. The groundbreaking research in cancer immunotherapies and regenerative medicine now dictate strict temperature and timeline compliance for all biologic materials transported around the globe. Some variables currently measured by the SmartPak II include internal and external temperatures, pressure, humidity, shock and orientation of the shipper. Additionally, the SmartPak II system provides Cryoport with the ability to correlate transit related events to the impact on sample integrity, providing valuable insight on crucial logistics planning and equipment performance. An example of its value occurred during its beta phase, the SmartPak II Condition Monitoring System, benefitted client by having a shipment saved during transit. In this instance, the SmartPak II notified our client care team of an extended orientation issue during a critical shipment from the United States to the Netherlands. Due to the alert sent by the SmartPak II, Cryoport logistics management was able to intervene and ensure that the material arrived safely for the scheduled patient procedure. We do not believe that any other company in the world has the capability of advanced monitoring, communication and intervention. Full commercial release of the SmartPak II is scheduled for August 31, 2016. Our SmartPak II Condition Monitoring System is a leap forward from anything that is in the market today. And we expect it to have a significant impact on cold-chain logistics for the life sciences industry as we have designed it to be comprehensive and dynamic. By offering real-time visibility of Cryoport Express shippers and the ability to communicate with the shippers, Cryoport is redefining effectiveness for quality control and regulatory compliance in supporting new immunotherapies and regenerative medicine. Our leading cold-chain logistics solutions for the life sciences have become essential tools for the logistics of temperature sensitive commodities. To our knowledge, we are un-matched in the science, technology and engineering behind our solutions and services. We are committed to continuous improvement and our capabilities in supplying solutions that the global life science market is demanding and/or will require in the future. These offerings serve to ensure that we continue to have the most comprehensive, end-to-end services and tools for tailoring client specific cold chain logistics solutions. For Cryoport, science, logistics, certainty, is not just a tag line; it is a mandate as we work to strengthen Cryoport's position as the go-to provider of choice for all cold chain logistics needs in the biopharma, reproductive medicine and animal health markets. We’re proud to enter fiscal year 2017 with an undeniable strength in our business culminating in the year-to-year revenue growth of 34% for the quarter. This is a sound start to the year, particularly when the viewed in the context of the collective embedded growth opportunities associated with our biopharma client base. At this point, I’ll turn the call over to Dr. Mark Sawicki, our Chief Commercial Officer, who continues to do an excellent job in leading CryoPort’s global sales and marketing initiatives. Dr Sawicki heads the sales and marketing team on enabling us to get a permanent foothold in the life sciences industry and to form important client relationships with major biopharmaceutical companies. You’ll find Mark’s comments interesting, but please hold your questions for Mark until the question-and-answer period. Mark the floor is yours.

. : As you could discern the number of trials we support continues to grow each and every quarter and on a risk adjusted basis represents a sizable portion of what we see as our embedded growth opportunity. From an overall company perspective, we reported policy trends and growth in both biopharma, reproductive health markets and we’re seeing signs of improvement in our animal health market. We believe that our revenue growth reported for the first quarter reflects the continuation of our growing traction and the success of our sales and marketing strategy to target agreements with major biopharmaceutical companies that have potential to significantly scale. We’re gaining market recognition and we’re becoming recognized for our competencies. We’re rapidly becoming the go-to partner for logistics serving biopharma. Our revenue for the first quarter of fiscal year 2017 was $1.9 million, an increase of 34%, or $1.5 million as compared to $1.4 million reported for the first quarter of fiscal year 2016. Mr. Stefanovich will provide more detail later during our call, but for now I would like to comment briefly on our revenue distribution by market. First, reproductive medicine. During the first quarter, we adjusted our marketing and laid the groundwork for recapturing our growth and reproductive medicine market. The resiliency of the U.S. demand for human reproductive services drove solid revenue growth of 11% year-over-year for the first quarter, despite changes in international regulation in some Asian countries. Our U.S. business actually tops 43% growth year-over-year while being offset by a 12% decline in the rest of the world market while also the previously mentioned, governmental restrictions relating to medical tourism. Secondly animal health, our revenue from animal health suffered primarily due to the slow down from one of our larger clients. In the first quarter of fiscal 2017, we experienced a 15% year-over-year decline. However, we view this as temporary and continued to see a significant opportunity for growth in the animal health market. In fact if we look at animal health revenue on a quarter to quarter basis, we actually increased revenue 8% over the fourth quarter of fiscal year 2016. Thirdly, biopharma. The biopharma market is the major driver of our growth and we expect a continued increase in new clients, clinical progressions and commercialization of programs. Our revenue growth for the first quarter was primarily driven by our expanding base of biopharma clients, of which CryoPort secured 28 new clients during the quarter. Biopharma accounts for the largest portion of our total revenue and is our fastest growing market. Our continued progress in signing new clients with groundbreaking life sciences companies and the world's foremost biopharmaceutical corporations positions us for further growth and continually validates our reputation as a best-in-class provider of reliable cold chain logistics solutions. Our market in biopharma is large giving us the opportunity to continue to demonstrate our ability to further strengthen our market position and secure increasing revenues. In response to market demand, we also rolled out several strategic initiatives during the quarter to accelerate future growth. You may remember that our last conference call a few weeks ago, we talked about CryoPort bio-storage, a service that will provide storage of biologic materials and eventually fulfillment services. A new integration capabilities to our CryoPort operating platform, which provides us the ability to manage the entire logistics process, beginning with order entry, paperwork generation, automated real-time monitoring, collection of vital information and continuing to full integration of storage fulfillment distribution scheduling logistics support and client systems to create centralized seamless singular data repositories providing the most comprehensive information about commodities during logistics process and fully supporting and enhancing comprehensive and vital chain of custody and chain of condition information. During the first quarter of fiscal year 2017, we also launched Cryoport Temperature Controlled Logistics Consulting Services to address cold chain advisory needs expressed by our clients. This new service addresses the demand created by the world-wide advances in cellular-based therapies, which are causing broad shifts and challenges for the life sciences industry and biopharma. Specifically, these new challenges include how to obtain property store and transport the growing number of new individualized temperature-sensitive therapies. Our clients know that improper temperature maintenance or temperature excursions during any portion of a logistics journey can adversely affect the viability of biologically based commodities quickly destroying tens of thousands or up to millions of dollars of irreplaceable life-saving materials. Consequently, we have identified a gap in the market for strategic global logistics planning for cryogenic cold-chain solutions in our fast growing life sciences market. As a globally recognized leader in cryogenic logistics solutions for the life sciences industry, we can tailor and assemble teams of experts with unique experience at developing customized, innovative solutions to address global cold chain logistics challenges on a holistic basis including bio-storage, fulfillment, distribution, and information strategies. Cryoport Temperature Controlled Logistics Consulting Services is now operational and under the direction of Ms. Tamie Joeckel, Senior Vice President of Client Services, Tamie’s 25 years of pharmaceutical industry experience including logistics having worked with companies such as AmerisourceBergen, McKesson, PAREXEL and Dohmen Life Sciences put her in a unique leadership position. Our many years of systems and logistics solutions development have put Cryoport in an excellent position to provide life sciences companies with a wealth of knowledge and best practices for cold chain logistics. Consequently, Cryoport’s Temperature Controlled Logistics Consulting Services is equipped to provide its clients with invaluable benefits and information, which is an integral part of any commercial launch discussion. Although we can’t forecast the financial impact for this new service precisely, we have discussed our new consulting practice with a number of life science companies and expect it will have a meaningful revenue impact over time. During the first quarter of fiscal year 2017, we also introduced SmartPak II Condition Monitoring System, which provides advanced real-time communication, including condition and location data for monitoring critical biological commodities and enhancing our core chain of condition and chain of custody information. The SmartPak II measures a variety of environmental variables and works in conjunction with the Cryoportal logistics management platform to provide comprehensive and seamless monitoring of commodity conditions in Cryoport Express shipper performance. We remain committed to staying ahead of the curve and proactively providing solutions to our clients in all markets. The groundbreaking research in cancer immunotherapies and regenerative medicine now dictate strict temperature and timeline compliance for all biologic materials transported around the globe. Some variables currently measured by the SmartPak II include internal and external temperatures, pressure, humidity, shock and orientation of the shipper. Additionally, the SmartPak II system provides Cryoport with the ability to correlate transit related events to the impact on sample integrity, providing valuable insight on crucial logistics planning and equipment performance. An example of its value occurred during its beta phase, the SmartPak II Condition Monitoring System, benefitted client by having a shipment saved during transit. In this instance, the SmartPak II notified our client care team of an extended orientation issue during a critical shipment from the United States to the Netherlands. Due to the alert sent by the SmartPak II, Cryoport logistics management was able to intervene and ensure that the material arrived safely for the scheduled patient procedure. We do not believe that any other company in the world has the capability of advanced monitoring, communication and intervention. Full commercial release of the SmartPak II is scheduled for August 31, 2016. Our SmartPak II Condition Monitoring System is a leap forward from anything that is in the market today. And we expect it to have a significant impact on cold-chain logistics for the life sciences industry as we have designed it to be comprehensive and dynamic. By offering real-time visibility of Cryoport Express shippers and the ability to communicate with the shippers, Cryoport is redefining effectiveness for quality control and regulatory compliance in supporting new immunotherapies and regenerative medicine. Our leading cold-chain logistics solutions for the life sciences have become essential tools for the logistics of temperature sensitive commodities. To our knowledge, we are un-matched in the science, technology and engineering behind our solutions and services. We are committed to continuous improvement and our capabilities in supplying solutions that the global life science market is demanding and/or will require in the future. These offerings serve to ensure that we continue to have the most comprehensive, end-to-end services and tools for tailoring client specific cold chain logistics solutions. For Cryoport, science, logistics, certainty, is not just a tag line; it is a mandate as we work to strengthen Cryoport's position as the go-to provider of choice for all cold chain logistics needs in the biopharma, reproductive medicine and animal health markets. We’re proud to enter fiscal year 2017 with an undeniable strength in our business culminating in the year-to-year revenue growth of 34% for the quarter. This is a sound start to the year, particularly when the viewed in the context of the collective embedded growth opportunities associated with our biopharma client base. At this point, I’ll turn the call over to Dr. Mark Sawicki, our Chief Commercial Officer, who continues to do an excellent job in leading CryoPort’s global sales and marketing initiatives. Dr Sawicki heads the sales and marketing team on enabling us to get a permanent foothold in the life sciences industry and to form important client relationships with major biopharmaceutical companies. You’ll find Mark’s comments interesting, but please hold your questions for Mark until the question-and-answer period. Mark the floor is yours.

.: As you could discern the number of trials we support continues to grow each and every quarter and on a risk adjusted basis represents a sizable portion of what we see as our embedded growth opportunity. From an overall company perspective, we reported policy trends and growth in both biopharma, reproductive health markets and we’re seeing signs of improvement in our animal health market. We believe that our revenue growth reported for the first quarter reflects the continuation of our growing traction and the success of our sales and marketing strategy to target agreements with major biopharmaceutical companies that have potential to significantly scale. We’re gaining market recognition and we’re becoming recognized for our competencies. We’re rapidly becoming the go-to partner for logistics serving biopharma. Our revenue for the first quarter of fiscal year 2017 was $1.9 million, an increase of 34%, or $1.5 million as compared to $1.4 million reported for the first quarter of fiscal year 2016. Mr. Stefanovich will provide more detail later during our call, but for now I would like to comment briefly on our revenue distribution by market. First, reproductive medicine. During the first quarter, we adjusted our marketing and laid the groundwork for recapturing our growth and reproductive medicine market. The resiliency of the U.S. demand for human reproductive services drove solid revenue growth of 11% year-over-year for the first quarter, despite changes in international regulation in some Asian countries. Our U.S. business actually tops 43% growth year-over-year while being offset by a 12% decline in the rest of the world market while also the previously mentioned, governmental restrictions relating to medical tourism. Secondly animal health, our revenue from animal health suffered primarily due to the slow down from one of our larger clients. In the first quarter of fiscal 2017, we experienced a 15% year-over-year decline. However, we view this as temporary and continued to see a significant opportunity for growth in the animal health market. In fact if we look at animal health revenue on a quarter to quarter basis, we actually increased revenue 8% over the fourth quarter of fiscal year 2016. Thirdly, biopharma. The biopharma market is the major driver of our growth and we expect a continued increase in new clients, clinical progressions and commercialization of programs. Our revenue growth for the first quarter was primarily driven by our expanding base of biopharma clients, of which CryoPort secured 28 new clients during the quarter. Biopharma accounts for the largest portion of our total revenue and is our fastest growing market. Our continued progress in signing new clients with groundbreaking life sciences companies and the world's foremost biopharmaceutical corporations positions us for further growth and continually validates our reputation as a best-in-class provider of reliable cold chain logistics solutions. Our market in biopharma is large giving us the opportunity to continue to demonstrate our ability to further strengthen our market position and secure increasing revenues. In response to market demand, we also rolled out several strategic initiatives during the quarter to accelerate future growth. You may remember that our last conference call a few weeks ago, we talked about CryoPort bio-storage, a service that will provide storage of biologic materials and eventually fulfillment services. A new integration capabilities to our CryoPort operating platform, which provides us the ability to manage the entire logistics process, beginning with order entry, paperwork generation, automated real-time monitoring, collection of vital information and continuing to full integration of storage fulfillment distribution scheduling logistics support and client systems to create centralized seamless singular data repositories providing the most comprehensive information about commodities during logistics process and fully supporting and enhancing comprehensive and vital chain of custody and chain of condition information. During the first quarter of fiscal year 2017, we also launched Cryoport Temperature Controlled Logistics Consulting Services to address cold chain advisory needs expressed by our clients. This new service addresses the demand created by the world-wide advances in cellular-based therapies, which are causing broad shifts and challenges for the life sciences industry and biopharma. Specifically, these new challenges include how to obtain property store and transport the growing number of new individualized temperature-sensitive therapies. Our clients know that improper temperature maintenance or temperature excursions during any portion of a logistics journey can adversely affect the viability of biologically based commodities quickly destroying tens of thousands or up to millions of dollars of irreplaceable life-saving materials. Consequently, we have identified a gap in the market for strategic global logistics planning for cryogenic cold-chain solutions in our fast growing life sciences market. As a globally recognized leader in cryogenic logistics solutions for the life sciences industry, we can tailor and assemble teams of experts with unique experience at developing customized, innovative solutions to address global cold chain logistics challenges on a holistic basis including bio-storage, fulfillment, distribution, and information strategies. Cryoport Temperature Controlled Logistics Consulting Services is now operational and under the direction of Ms. Tamie Joeckel, Senior Vice President of Client Services, Tamie’s 25 years of pharmaceutical industry experience including logistics having worked with companies such as AmerisourceBergen, McKesson, PAREXEL and Dohmen Life Sciences put her in a unique leadership position. Our many years of systems and logistics solutions development have put Cryoport in an excellent position to provide life sciences companies with a wealth of knowledge and best practices for cold chain logistics. Consequently, Cryoport’s Temperature Controlled Logistics Consulting Services is equipped to provide its clients with invaluable benefits and information, which is an integral part of any commercial launch discussion. Although we can’t forecast the financial impact for this new service precisely, we have discussed our new consulting practice with a number of life science companies and expect it will have a meaningful revenue impact over time. During the first quarter of fiscal year 2017, we also introduced SmartPak II Condition Monitoring System, which provides advanced real-time communication, including condition and location data for monitoring critical biological commodities and enhancing our core chain of condition and chain of custody information. The SmartPak II measures a variety of environmental variables and works in conjunction with the Cryoportal logistics management platform to provide comprehensive and seamless monitoring of commodity conditions in Cryoport Express shipper performance. We remain committed to staying ahead of the curve and proactively providing solutions to our clients in all markets. The groundbreaking research in cancer immunotherapies and regenerative medicine now dictate strict temperature and timeline compliance for all biologic materials transported around the globe. Some variables currently measured by the SmartPak II include internal and external temperatures, pressure, humidity, shock and orientation of the shipper. Additionally, the SmartPak II system provides Cryoport with the ability to correlate transit related events to the impact on sample integrity, providing valuable insight on crucial logistics planning and equipment performance. An example of its value occurred during its beta phase, the SmartPak II Condition Monitoring System, benefitted client by having a shipment saved during transit. In this instance, the SmartPak II notified our client care team of an extended orientation issue during a critical shipment from the United States to the Netherlands. Due to the alert sent by the SmartPak II, Cryoport logistics management was able to intervene and ensure that the material arrived safely for the scheduled patient procedure. We do not believe that any other company in the world has the capability of advanced monitoring, communication and intervention. Full commercial release of the SmartPak II is scheduled for August 31, 2016. Our SmartPak II Condition Monitoring System is a leap forward from anything that is in the market today. And we expect it to have a significant impact on cold-chain logistics for the life sciences industry as we have designed it to be comprehensive and dynamic. By offering real-time visibility of Cryoport Express shippers and the ability to communicate with the shippers, Cryoport is redefining effectiveness for quality control and regulatory compliance in supporting new immunotherapies and regenerative medicine. Our leading cold-chain logistics solutions for the life sciences have become essential tools for the logistics of temperature sensitive commodities. To our knowledge, we are un-matched in the science, technology and engineering behind our solutions and services. We are committed to continuous improvement and our capabilities in supplying solutions that the global life science market is demanding and/or will require in the future. These offerings serve to ensure that we continue to have the most comprehensive, end-to-end services and tools for tailoring client specific cold chain logistics solutions. For Cryoport, science, logistics, certainty, is not just a tag line; it is a mandate as we work to strengthen Cryoport's position as the go-to provider of choice for all cold chain logistics needs in the biopharma, reproductive medicine and animal health markets. We’re proud to enter fiscal year 2017 with an undeniable strength in our business culminating in the year-to-year revenue growth of 34% for the quarter. This is a sound start to the year, particularly when the viewed in the context of the collective embedded growth opportunities associated with our biopharma client base. At this point, I’ll turn the call over to Dr. Mark Sawicki, our Chief Commercial Officer, who continues to do an excellent job in leading CryoPort’s global sales and marketing initiatives. Dr Sawicki heads the sales and marketing team on enabling us to get a permanent foothold in the life sciences industry and to form important client relationships with major biopharmaceutical companies. You’ll find Mark’s comments interesting, but please hold your questions for Mark until the question-and-answer period. Mark the floor is yours.

Mark Sawicki: Thank you, Jerry. It’s a pleasure to have the opportunity to speak with you today. The biopharma market continues to experience robust growth and excitement as it enters the new phase of its evolution. In particular with the aggressive expansion and maturation of the regenerative medicines’ market. Its market includes cell-based therapies, which include CAR-T therapies, gene therapies, biologics as well as tissue engineering therapies and represents more than 685 companies on a global basis. In fact, there mounting excitement in this space with a number of the leading CAR-T projects expected to be filing for U.S. approval over the next 12 calendar months. Moreover, biopharma companies continue to make significant investments in developing CAR-T cell therapies with more than $1.3 billion in financings in the recent fiscal quarter alone. Over the next 12 months to 18 months, we anticipate additional CAR-T projects will be filed for U.S. approval and we expect to see the first commercial projects coming to market in this space. What this dramatic shift means in practice is that multi-billion dollar companies have aggressively invested in billing out their portfolios on the understanding that CAR-T cell therapy could become the standard therapy in certain refractory cancers. Recent announced industry partnerships include a $2 billion investment by Biogen with the University of Pennsylvania to develop gene therapy treatments, and Regeneron’s $125 million licensing deal with Intellia Therapeutics to develop CRISPR and Cas Therapeutics. The majority of these companies rely on CryoPort to optimize their entire logistics supply chain in support of their clinical trials and ensuing commercialization activities. The early adoption of our services in this exponential growth area of the biopharma marketplace and the potential for us to scale with our clients as their therapies are approved, is very encouraging. Our cold-chain logistics solutions are currently supporting 23 out of the 28 leading clinical-stage CAR-T cell programs that are ongoing. CryoPort is also now supporting more than 90 clinical trials, including 14 Phase 3 programs. In addition, at the end of the first quarter of fiscal year 2017, we signed our first agreement to support the manufacturer of a multi-billion dollar commercially launched biopharma product, as we previously disclosed. As more clinical data is generated and results are interpreted, the more and more likely it appears that regenerative medicine will become an interval part of the future of healthcare. We are extremely excited that CryoPort is so well positioned to leverage this industry growth. There are now more than 685 companies involved in gene and cell therapies worldwide, and they’re supporting more than 728 clinical trials, including 66 Phase 3 programs and the number of new entrants continues to accelerate. It’s hard to overemphasize how important CryoPort solutions are to the success of this market. Biopharmaceuticals are incredibly sensitive to the slightest changes in temperature, pressure, humidity, or other conditions. A very specialized approach to transporting biologic materials is absolutely vital to maintain the integrity of the product, especially for air-cargo shipments where temperature excursions account for approximately $12 billion in pharmaceutical product loss each year according to the International Air Transport Association. As only publicly-listed, pure – as the only publicly-listed, pure-play cryogenic logistics provider to the biopharma space, we operate in a very niche and lucrative segment of this market. CryoPort has been very active in client engagement in this space. As I stated previously, we have expanded the number of clinical trials we support to 90, including 14 Phase 3 trials, which has expanded our market share in this space to more than 12% of the total clinical market and 21% of the Phase 3 pipeline. And in fact, of those 14 Phase 3 projects, we are heavily engaged in commercialization discussions with six companies on their launch needs, the earliest of which is set to launch in late fiscal year 2017 or early fiscal year 2018. In addition, we also signed for the support of our first commercial program with one of the largest pharmaceutical companies in the Americas supporting a multi-billion dollar biologic product that is already on the market. Although this happened in the first quarter of fiscal year 2017, we had already disclosed it on the fourth quarter call for fiscal year 2016, so we will not readdress it here. I would like to reiterate, however, that this was a very important milestone for CryoPort as it validates our competency to support commercial programs for the clients we are currently working with. This includes clients of the 90 clinical trials we currently support and gives us a world renowned customer in the biologics therapeutics market, which is estimated to represent more than 20% of the worldwide pharmaceutical market in 2017. We expect this program as well as the maturation of the clinical programs in our portfolio to accelerate our revenues in the biopharma space throughout fiscal year 2017. Thank you. I’ll be happy to take questions during the Q&A period. Now, I will turn the floor back to Jerry.

Jerry Shelton: Thank you, Mark. For a more detailed discussion of our financial report for the first quarter of fiscal year 2017, I would like to introduce our Chief Financial Officer, Mr. Robert Stefanovich. Robert?

Robert Stefanovich: Thank you, Jerry. Good afternoon everyone. I’ll now review the financial results for the first quarter of fiscal year 2017, provide some additional comments, and then turn the call back over to Jerry. As a reminder, our current fiscal year ends March 31, 2017, and today we are reporting on our first quarter of fiscal year 2017, which ended June 30. Now to our first quarter results, our net revenues for the first quarter were $1.9 million, an increase of 34% or $486,000 as compared to $1.4 million reported for the same quarter last year. As you can see, we continued to show strong double-digit revenue growth. This growth was driven by our biopharma clients, where our revenue increased by 60% to $1.3 million compared to $0.8 million for the prior year first quarter. We added 28 additional new clients in this market and now supporting 90 clinical trials of which 14 trials are in Phase 3. This increased activity in biopharma and the clinical trial space in particular continues to be the growth engine for CryoPort with a promise of significant revenue streams as these clinical trials advance and the resulting therapies are commercialized. Although not all drugs will move through the commercialization phase, given our broad client base in the biopharma market, our overall commercial success is not tied to the success of one particular drug or therapy. We believe this to be important to investors as they assess their investment risks in this attractive market. Revenue in the reproductive medicine market increased by 10% to $370,000 for the quarter compared to the last year’s first quarter. This increase was primarily driven by revenue growth in the U.S. market with 43%, partially offset by a lower revenue ramp of 12% year-over-year related to regulatory changes in Asia regarding medical tourism. Our revenue in animal health decreased 15% to $229,000 for the quarter compared to the same period in the prior year due to the lower shipping volumes we mentioned during our last earnings call, but they did grow sequentially by 8% compared to the previous quarter. Gross margin for the quarter was 41% as compared to 34% for the same period last year. This is an improvement of over six percentage points and reflects several management initiatives to drive margin growth towards our target of 60% as we grow the business and benefit from economies of scale. The improved gross margin was driven by increased business volume and pricing adjustments, as well as a reduction in freight as the percentage of revenues. Operating expenses increased $0.7 million for the three months or 31% as compared to the prior year quarter. General and administrative expenses increased by $288,000 or 25% for the quarter. This increase is primarily due to increases in non-cash stock-based compensation expense of $222,000, facility expenses of $42,000 related to the move to our new facilities in Ervin, California, and an increase in salaries and associated employee costs. Sales and marketing expenses increased $312,000 or 35% for the quarter. This increase is primarily due to increases in salaries and associated employee costs, and the aggregate amount of $133,000 incurred to expand our sales and logistics force, targeted marketing initiatives to support our sales efforts in the amount of $111,000, non-cash stock-based compensation expense of $27,000, and facility expenses of $26,000 related to our office move. Research and development expenses increased $58,000 or 75% for the quarter as compared to the prior year first quarter. This increase was primarily due to salary and associated employee costs related to the addition of a research and development engineer. Our research and development efforts are focused on continually improving the features of the Cryoport Express Solutions including the company’s cloud-based logistics management platform, the Cryoportal; the Cryoport Express Shippers; and development of additional accessories to facilitate the efficient shipment of life science commodities using our solution. In addition, research and development efforts have been directed towards developing our advanced condition monitoring system to Smart Pak II. Net loss attributable to common stockholders for the three months period ended June 30, 2016, was $3.9 million or $0.28 per share compared to $6.6 million or $1.31 per share in the last fiscal year’s first quarter. Q1 of fiscal year 2017 included warrant repricing expenses of $1.9 million related to the warrant tender offer that was completed on April 7, 2016, and Q1 of fiscal year 2016 included a preferred stock beneficial conversion charge of $4.5 million. These are both non-cash charges. Cash and cash equivalents as of June 30, 2016 was $4.5 million compared to $2.8 million at fiscal yearend March 31, 2016. In addition to the cash in hand, we completed two equity raises during the quarter. In April, we completed a warrant tender offer raising $2.5 million in gross proceeds, and in June we completed a rights offering for gross proceeds of $1.3 million. In addition, we just commenced an exchange offer with respect to the company’s outstanding $7.1 million warrants with an exercise price of $3.57 per share. For a limited period of time, the company is offering to the holders the opportunity to exchange such warrants for an equal number of warrants to purchase one share of common stock as an exercise price of $1.50 per share, condition upon the immediate exercise of such warrants, and one warrant to purchase one share of common stock at an exercise price of $3 per share for every four warrants exercise. This equates to 25% warrant coverage. The supplemental warrants have a put option that is triggered when our common stock equals or exceeds $4.50 per share for 10 consecutive trading days. The offering is scheduled to end September 16, 2016. The funds raised in the exchange offer will be used for working capital purposes and to continue to derive customer acquisition and revenue growth. This exchange offer is also expected to reduce our warrants outstanding, which improves our capital structure. We filed a prospectus outlining the terms and conditions for this offering last week. We currently have 15.2 million shares of common stock and 9.1 million warrants outstanding. We have no preferred stock outstanding. And lastly, we filed our – we just filed our Form10-Q with the SEC. With that, I’ll turn back to Jerry. Jerry?

Jerry Shelton: Thank you, Robert. I’d like to thank all of our loyal, long-term shareholders for supporting us in this pivotal time in our development. As you’ve heard, much of our future growth will be fueled by regenerative medicine, which is a cutting-edge area of healthcare that has been on the receiving end of billions of dollars of investment in recent years, and over the next months and years is expected to become an increasingly normalized treatment option. We’ve described ourselves in the past as a crucial supporting service to the life sciences, the pick and shovel of regenerative medicine as we are a support system for the multi-billion dollar corporations that have invested in this space. In addition, it’s important to note that with every quarter passing, we become more and more established with an increasing number of clients. Our advanced solutions require talented people and multiple leading edge technologies to provide with the liability essential to maintaining our role as a trusted third-party, cold-chain logistics provider to the life sciences industry, attributes that cannot be easily replicated. As a result, we have faced minimal competition in a high growth sector leading our team well positioned to secure new clients and grow market share. By significantly investing in our research and development work, we are ensuring that our solutions will remain unlatched by new entrants to the market. Our client list demonstrates that our solutions are in demand by even the most discriminating biopharma companies. By embracing the long ramp up times for new clients, we have established a strong foundation for growth as a result of the embedded opportunities in our existing client base. Financially, we are in the strongest position of our existence. We understand the cost of growth. As for uses of funds, infrastructure development, and maintenance, keeping it in tune with industry demands, highly qualified and trained people having sufficient facilities in inventory, and having sufficient working capital requires continuous investment. It is our goal to become cash flow positive as soon as practical. However, these are essential investments, we will continue to manage cost responsibly while aggressively growing the business and clearly getting a position of dominance for the future, which we think is the right strategy for serving the market on a sustainable basis and creating shareholder value. In short, we are proud of the progress we’ve made to date. We will continue to prudently investment in our business to grow it, protect its market position, and endeavor to maximize shareholder value. We are incredibly excited about our future. Personally, I think we are now in the time long-term shareholders have anticipated. Thank you for joining us today. We hope you find our call informative. We appreciate your support and your confidence in CryoPort. This end our formal remarks or prepared remarks. Now, I’ll turn the floor back to Mr. Fromer, who will open the call for questions.

Todd Fromer: Thank you, Jerry. Operator, could you please begin to take questions.

Operator: Thank you. [Operator Instructions] And we’ll go with Fred Oar [ph], Private Investor.

Unidentified Analyst: Hi, Jerry. I had a couple of just mechanical questions. First of all, I really appreciate the management trying to give us some metrics so we can get a feel for how revenues may progress in terms of customer count and the count of trials that are in various stages. And I think you gave us some metrics, estimates on potential revenues from clients in each stage of clinical trials. But I believe you said that you’ve ended the March quarter with 78 client relationships and added 28 in the first quarter and ended with 90. Does that mean that there were 15 or 16 failures within clinical trial of the customers you had at the end of March, or are you counting customers that are not quite up and running yet, and I just wanted a little more clarity on that particular number?

Jerry Shelton: That’s a good catch. I’m going to turn the call to Mark, because he will have the answer at the tip of his tongue.

Mark Sawicki: Okay, thank you. So – thank you Jerry. So the numbers you’re looking at are two different things…

Unidentified Analyst: Okay….

Mark Sawicki: First and foremost, the 78 supported clients with the number of clinical trials we are supporting at the end of the last fiscal year; that number is increased by 12 trials to 90 clinical trials.

Unidentified Analyst: Okay.

Mark Sawicki: The total number of clients that we are supporting is well over 500 clients, and so we’ve added 28 new clients to that roster of over 500 clients, and I don’t have the exact number in front of me, but it’s probably close to 600 at this point.

Unidentified Analyst: The multi-hundreds of clients you’re supporting, what are they doing – are they going to be entering clinical trials at some future date or I don’t understand what you mean by supporting them.

Mark Sawicki: Well there’s a wide diversity beyond clinical trials that require the type of services that we support. So, obviously…

Unidentified Analyst: [Indiscernible]

Mark Sawicki: [Indiscernible] we’re doing cell lines, and tissue samples, and organs and all kinds of other elements that aren’t necessarily clinical related.

Unidentified Analyst: Yes. Okay, because I was trying to build a revenue model in your pharma division, based just on clinical trial work, and I can’t do that from what you’re telling me, okay

Mark Sawicki: No, there’s – that’s correct.

Unidentified Analyst: Okay. And the second thing that, again going back to your last conference call, Jerry tried to give us some metrics with regard to revenue potential as you move through the various clinical trial stages. And it looks to me like [indiscernible] CAR-T trials in Phase III currently are quite small in number. So I’m presuming that those Phase III trials if they’re all up and running are not nearly commensurate with the kinds of revenue potential that Jerry had mentioned in that call. I’ve seen some of these trials with as few as 20 to 30 patients and I don’t think that generates very much shipment volumes for you guys. Is that a reasonable takeaway for me to make?

Mark Sawicki: It’s a very difficult – you can’t just go in and look at a clinicaltrials.gov database to get an understanding of shipment volumes.

Unidentified Analyst: Okay.

Mark Sawicki: You may have a treatment that has one shipment per patient you may have a trial that has 16 to 20 shipments per patient.

Unidentified Analyst: Okay.

Mark Sawicki: It’s very, very, varied. So the biggest – the limiting factor in regards to revenue generation around clinical trials is their patient enrollment and whether or not they’re on target or they’re slow in regards to their enrollment processes.

Unidentified Analyst: Right. Okay.

Mark Sawicki: That’s where we see the most volatility.

Unidentified Analyst: And of the 14 Phase IIIs I assume some of those are still in the recruitment stage and not actually up and running.

Jerry Shelton: I think that’s a fair assessment, yeah.

Unidentified Analyst: Okay. And then final question, will you start to book revenues in the current quarter from the commercial customer you signed late last – that you announced at the last conference call?

Jerry Shelton: Yes, the answer is yes. So – there will be a ramp up there, it won’t – it doesn’t just start – the floodgates [indiscernible].

Unidentified Analyst: Yes, right. Yeah, I understand. But you’ll start seeing some shipment volumes from that customer in the current quarter.

Mark Sawicki: Yes, they have started shipping with us. That’s correct.

Unidentified Analyst: Okay. You guys are completely wrecking my ability to forecast revenues. That’s actually what you do. And by the way, I was very impressed with the cost of goods sold numbers on that revenue increment. It gives a lot of credence to Jerry’s long-term forecast of trying to approach [60%] [ph] gross margins, because it looks like, in fact, that’s what you demonstrated incrementally, in the quarter. So kudos and with that I’ll shut up.

Mark Sawicki: Thank you very much.

Jerry Shelton: Thank you very much. Nice, good question.

Operator: We’ll now move on to the David Holperin with Stifel.

Jerry Shelton: Hi, David.

David Holperin: As before I have a couple of questions for different players here. Jerry, I’d like to start with you, you were touting your relationship with Kite earlier, but recently they announced a 10-year supply agreement with BioLife Solutions. How does that impact our relationship with Kite?

Jerry Shelton: It’s totally separate, the 10-year relationship with BioLife Solutions is for a cryo solution. It has nothing to do with what we do, nor does BioLife Solutions have anything that’s competitive with Cryoport. We are in the cryogenic logistics area, the primary product for BioLife Solutions is cryo solutions and they’re quite good at that. So that’s their 10-year agreement, it doesn’t impact us at all. In fact, we’re very close to Kite.

David Holperin: Okay. Robert, I haven’t had an opportunity to read this recent filing on the warrant conversion pricing that just came out, I think, Friday. But how much you’re expecting to rise from that and how is that going to impact the consolidated statement of operations?

Robert Stefanovich: Yes, I mean we just commenced with it. We do know that there is shareholder interest, we’re not at this stage in a position really to say where it will come out, what the participation will be, but we do believe it is an attractive offering to the investors that hold these warrants. At the same time it allows us to bring in funds and even the additional warrant that we issue as I mentioned earlier, there’s a trigger and that will then enforce the conversion and bring additional funds into the company as well.

David Holperin: But you made the statement at the end of your presentation that you – it wasn’t going to impact the number of common shares outstanding, I’m confused by that. Did I hear you correctly in what you said?

Robert Stefanovich: No, no, let me clarify it, you did not. So this really allows us to eliminate some of the warrant overhang. So, it will add additional common stocks that are registered under the registration statement that we filed last week, but it will reduce the warrant overhang that we have.

David Holperin: Okay, got it. Mark, I have a question for you. This contract manufacturer that Fred was just talking about, they’re unnamed. At some point are you going to be able to tell us who that is?

Mark Sawicki: Yes, that’s our goal. I mean, one of the challenges that we have is – there’s a large number of our clients that view us as a competitive advantage and almost proprietary information. And so we have to massage that in which to get them to allow us to disclose, obviously the nature and extent of the relationship itself. Our goal is that as it matures that we will be able to name name so to speak.

David Holperin: Okay.

Mark Sawicki: And I just wanted to clarify one other aspect on that, BioLife Solutions that Jerry was talking about, so what BioLife does is they produce what’s called cryopreservatives. So this is the actual solution that the cells are suspended in when they are frozen. So it has nothing to do with actual transportation, it has to do with the laboratory processes or freezing and thawing the cells. There are two different things.

David Holperin: But in the announcement that they made they said that they were going to support Kite throughout the entire process, which hinted that that would include the transportation logistics.

Mark Sawicki: No, it has nothing to do with the movement of cryopreserved materials at all, whatsoever.

Jerry Shelton: Yes, you could say that, I mean, remember it’s a solutions you have to transport the materials and solutions and that’s very skillfully phrased. And they do a good job in that area on the cryo solutions.

Robert Stefanovich: Yes, one of the things you have to differentiate with it is that a lot of folks will talk about logistics of movement of materials round within laboratory settings as logistics, but it’s on-site laboratory and logistics. And I do believe that they’re trying to at least put a product on the market that will facilitate movement of apheresis product around at two to eight degrees that’s not cryogenic though.

David Holperin: Okay. Do we support BioLife Solutions, are they a customer of yours?

Jerry Shelton: No, they are not currently a customer, but we do have conversations and I’m associated with their CEO and recently, well, we’re not close or anything of that nature, nor do we have any kind of strategic agreement, but we do talk from time to time.

David Holperin: Okay, let me move on. Can you give us any background as to why Levi & Korsinsky is investigating you for possible breaches of fiduciary duty by the Board?

Jerry Shelton: Yes, I can give you a point of view. They are a disreputable outfit that does what a lot of law firms do, they try to extort, we’ve received nothing from Levi for any court or anyone else, we’re totally above board, they have no basis for what they are doing, But its Wall Street’s version of ambulance chasers as far as I’m concerned. Probably a short seller put them up to it to try to keep our stock price down because we have an offering out, who knows, it’s all speculation. You are in this game for a lot longer than I am David, and on that side, so you probably have your own suspicion as to who it is, but it is the part of the hazard of being a public company something that’s we have to put up with but it’s certainly not desirable, there is no basis for it.

David Holperin: But I also know that these guys frequently extract money from firms, frequently?

Jerry Shelton: I can’t do much about that except find out what– what’s going on after the call, I was as surprised to see that as anyone just before the call; very strategically timed by the people who are trying to do what you just suggested, extract funds from a company.

David Holperin: All right, my last question Jerry is for you. I mean I’m on the same page as you guys, I want the same outcome you want and I’m very excited for what you are doing, but reality is that last year after coming up awfully short of your estimates that you gave us you withdrew your revenue guidance, you withdrew all of your estimate as to when we get the cash flow break-even and we had three capital raises all of which are dilutive to existing shareholders. But yet you rewarded yourself with the substantial amount of stock I don’t have the exact number but I thought it was 800,000 shares. Although, you continue with your optimistic outlook that you just gave us today. You have yet to materially capture even – really a minute fraction of the global Deep Frozen market, which I think you yourself said exceeds $1.5 billion. So can you give us a hint as to what we should expect for your compensation for this year?

Jerry Shelton: I need to correct your assertion and certainly your understanding if you stated your understanding, First, I don’t award myself anything, I work for the shareholders through the Board of Directors, the Board of Directors controls any compensation to me. I take a miniscule amount of cash in this company, probably a sixth of what, even less than that, 10% of what I earned before coming [indiscernible] to work. Those options are $5 a share at this point so that you just mentioned. So you don’t – to imply that I have some kind of a gift is ridiculous, I’m incentivized by the same thing that any other shareholder is incentivized by in addition to the personal investment, cash investment, that I made in the company to keep it alive and to support it and to get it to the point that it is right now. So anything that comes at me that focuses on anything to do with me doing anything inappropriate, there is absolutely an inappropriate assertion, cannot be founded, and has no basis for assertion. So that’s number one. Number two, my compensation is governed by the Board, my cash compensation is $300,000 a year and it has not gone up one nickel since I came three and a half years ago. So the Board of Directors, the compensation committee make that decision, not me, I’m simply the CEO, I work for the shareholders through the Board of Directors.

David Holperin: And I get all that. I’m not accusing of anything. I’m just saying as a shareholder we’ve been here a long time, we’ve heard a lot of promises and with the share price continually dropping it allows for more dilution which we’re experiencing with every capital raise and every time shares are given to your entire staff.

Jerry Shelton: It’s not just my staff, it’s every shareholder, it’s every employee in CryoPort because [indiscernible] have options in this company, and as far as dilution is concerned, dilution, you can look at dilution in a number of different ways. I mean this is – it requires investment, essential investments that I try to make clear in my comments. To get the company scale and to get the company to the point that it can provide the solutions that are required. It also to get new – to continue to get new customers it’s going to require much stronger balance sheet. So I can only act responsibly, I mean my first job is to make sure that the shareholders -, this would balance in serving shareholders. You can have 100% of nothing or you can have a portion of something that really has some value. And what we’re about here is creating true value. And once we’re cash flow positive this discussion doesn’t have the same kind of levity as here; I know that long-term shareholders have suffered from a financial point of view, believe me, I know that in spades; I talk with shareholders all the time including you from time to time. And I’m sympathetic to that, I have my own investments in this company and it’s all under water as well as investments in other companies that are under water, I know what shareholders feel, we act responsibly and we make the essential investments that are necessary to get us to the place we are. Three and a half years ago we were $500,000 in revenue. We closed last year at 6 million, sure, I missed an estimate because a couple of things didn’t come true, it kind of burnt me, and I said I’m not making any more estimates. I am just not going to do it. We’re too small and because we’re data driven, there is too much uncertainty. I can’t do it in good faith, so decided not to do it because it wasn’t in everyone’s best interest including yours to be hanging your head on something that I might say that has high degree of risk involved. So, I didn’t make them and I decided not to make anymore. So all I can say is that we kind of balance these things, and I am concerned about shareholder value. I am concerned about responsibly representing – if I don’t do – we don’t do what we’re doing now, we don’t have a future. And I hope that makes sense to you David.

Operator: We’ll now move on to [Randy Roget] [ph] who is a Private Investor.

Jerry Shelton: Hi, Randy.

Unidentified Analyst: Yes. Hi, Jerry. See just one question, I appreciate your comments on the Bio Solutions company. As far as the cash position, so the loss this quarter is about $3.9 million. How much of that was cash? I know there was quite a bit of non-cash.

Jerry Shelton: Robert, will you take that question?

Robert Stefanovich: Yes. So if you look at what we have in terms of cash and non-cash for the quarter, I think last time we mentioned we have about a cash burn of roughly about $580,000 and we don’t expect the cash burn other than cash needed to build up our inventory of shippers and [monetary] [ph] systems, but regular operating cash burn to change significantly.

Unidentified Analyst: Okay, very good, that’s all I had.

Jerry Shelton: Thank you.

Operator: We will move on to Stephen Balinskas with Source Capital Group.

Jerry Shelton: Hi, Stephen.

Stephen Balinskas: Thanks for taking my call. Actually, I think Mr. Holperin scooped me a little bit because I too would like to ask about the current – the warrant tender. And I guess my first question is I think you’re looking for a maximum up to about $9 million, I think. And so if you realized something approaching the maximum, do you think that would be [indiscernible] at least a year or so or what do you believe?

Jerry Shelton: The answer to that the way you phrased it is it would be up to just true speculation because first of all we have no idea how this is going to come out. We think that this is a really compelling offer for the warrant holders, but who knows how many people are going to walk to buy in or who are in a financial position to buy in to it. We simply don’t know. So to make that speculation I don’t think it would be responsible right now.

Stephen Balinskas: Actually that has something to do with my second, but if you did realized something approaching $9 million that might keep you funded for about a year. But part two of my question, and this is perhaps just going to be a guesstimation on your part, which I’m sure you loathe to do, but does the current tender – is it targeting roughly the same investor base as the last – let me explain if I can. For the April warrant tender, you guys had what I would term a pretty good take up on that tender. I think it 83% of the maximum you are looking for – I call it pretty good. These warrant holders, holding warrants at 350, are they roughly the same group of investors do you believe that were holding the other warrants that you realized in the last tender?

Jerry Shelton: I don’t know that we are in a position to comment on that actually, about who sold what, but I just don’t think we are.

Stephen Balinskas: Okay, fair enough. Thank you very much.

Jerry Shelton: Thank you.

Operator: With no other questions in queue, that will conclude today’s conference ladies and gentlemen. We thank you for your participation and you may now disconnect.