Ann: Quarterly Investor Conference Call , page-2

Who listen in?

Interesting call. Garry got pretty grilled by some of the instos at some points, a few clever questions were asked, and few silly ones aswell.

I didn't really take many notes, however he's my basic summary from off the top, for those who missed it and don't have the time to listen in later on...

It Sounds like sales growth in Germany and the UK should defiantly improve over this quarter, with more clarity over reimbursement in the UK, and better understanding/ teaching in the Germany clinics on how Bronticol is to be administered.

There were also alot of questions geared towards the Australian market and the poor uptake( Which Garry admitted he was disappointed with himself). It sounds like only around 10% of current CF Patients are eligible under the current reimbursement scheme. This is something MGMT are confident will change during this quarter, with support/ agreement on their application for different terms in assessment criteria- which don't just focus on lung function/improvement. As we know for alot of CF patients it's not just about improving lung function, but also maintaining the function they currently have.

Cash burn was obviously a concern by many, and it was stated that there will be significant improvement, however that won't be realized until later on this year, or during following couple of quarters. During this current quarter the cash flow will represent structure changes in spending.

On a positive note, it sounds like that additional 20mil from Novaquest can be drawn down at the company's discretion, providing it's used to fund another trial. So that's where a majority of the funding would come from for the additional PH3 that the FDA requires for any Bronchitol approval. As we know from the presentation they will be meeting with the FDA this quarter to discuss new trial design/ structure. Base costs for the trial would be around 12mil, with the duration around 2 years...The study would likely kick off early next year.

If anyone wasn't already aware, we couldn't have filed for a labeled approval with the FDA eg 18+, since the approval from the FDA has to be aligned with the trial design/ primary end point, and from my understanding the trial wasn't split into sub-groups that allowed us to do that.

The Bronchiectasis Ph3 is a completely different story though, with the Primary end point aimed directly at what the regulatory bodies are interested in. It has also been split into different sub groups so some of the data can be looked at more Independently. This is largely because the diagnosis of Bronchiectasis is far less specific, with big differences between mild/ severe patients. The study is largely geared towards suffers who have a more severe condition, and a most likely the patients that would be covered under any reimbursement scheme. This could account to as many as 100,000 patients in the US alone.

The Bronchiectasis Ph3 is of HUGE significance to this company's direction/ future. Even if all the end points aren't met in the Ph3, it could still add tremendous value to the company's IP, as there is currently no other Bronchiectasis drugs in PH3 trials, and no drugs have ever been approved to assist mucus clearance. According to Garry, physicians are eagerly awaiting the results of the PH3, and interest has been ever increasing in terms of Bronchitol use in Bronchiectasis patients.

Results are still expected later on this quarter, along with a more accurate business plan for the future of the company. No hints were giving at all in regards to the Ph3 data, which still hasn't been looked at by their statisticians. IMO results will likely come be very close to the end of Q2, or perhaps even early Q3.

It sounds like the real money could be in treating Bronchiectasis not CF...