Question-and-Answer Session
Operator
(Operator Instructions). We will take our first question from William Ho with Banc of America Securities.
William Ho – Banc of America Securities
Can you give us anything at all on what kind of study you are going to have to do if the FDA does not except your analysis, and how long that study could take?
Solomon Steiner
Well, you are asking me to project what a regulatory agency is going to do. I’d rather predict the stock market. They could be satisfied with what we have which we think is the likely outcome and we would file. They may require another study. That study could be a 3-month study. At worst case, it would be a 6-month study, and they can do anything that they choose to do in addition to that. I don’t know how helpful that is, but I think its accurate.
William Ho - Banc of America Securities
I heard that several companies developing drugs in the diabetes space have received letters from the FDA surrounding cardiovascular risk and requiring analysis of their data. Have you received such a letter or do you expect to receive such a letter?
Solomon Steiner
No, we have not received such a letter. I do not expect to receive such a letter. Most of what you are talking about Bill is mostly drugs that are new chemical entities. We are not a new chemical entity. We are regular recombinant human insulin and mostly for the treatment of type 2 diabetes, and furthermore, we have a cardiovascular signal in our studies, and that is that we’re better, we’re safer, so for all of the above reasons, I doubt that we will get such a letter, but one never knows.
Operator
Our next question comes from Liana Moussatos with Pacific Growth Equity.
Liana Moussatos - Pacific Growth Equity
Gerard said that the $90 million at the end of the quarter represents about 2 years cash under current assumptions, and I wondered if you could review those assumptions, and then I have a couple of other questions.
Gerard Michel
I’ll give you the categories of assumptions, and there are some I cannot give you adequate detail on, but the first assumption has to do with our extension trial which is ongoing and how long that will last. The second assumption has to do with the size of an additional type 1 trial that we want to conduct for commercial purposes. Third critical driver of expense is our purchase commitment which we have in there right now under a scenario that we are commercializing the drug in the near term. Those are the three biggest drivers of the 2-year cash flow. The overall scenario that we’re projecting under is that we file, we run another trial, but I’m not going to put numbers around to those categories for you.
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