CAPR - NASDAQ

Good afternoon, ladies and gentlemen and welcome to the Capricor’s Third Quarter 2023 Financial Results and Corporate Update Call. This conference call is being recorded. I would now like to turn the conference call over to our host, Mr. AJ Bergmann, Capricor’s Chief Financial Officer. Please go ahead.

Thanks, Linda. This afternoon’s press release provided a summary of our third quarter 2023 financials on a GAAP basis, and you may also refer to our quarterly report on Form 10-Q, which we expect to become available shortly and will be accessible on the SEC website, as well as the financial section of our website. Turning to the financials, let me start with our cash position. We ended September 30, 2023 with cash, cash equivalents and marketable securities of approximately $28.5 million. This excludes the $23 million in gross proceeds from the registered direct offering we completed in October that bolstered our cash position. Based on our recent operating results and current projections, we now expect our cash runway to extend into 2025, an extension from our prior guidance. In the third quarter of 2023, our commercialization revenue was approximately $6.2 million. That compares to approximately $1.6 million for the third quarter of 2022. Turning quickly to the expenses, excluding stock-based compensation, our research and development expenses were approximately $9.5 million for the third quarter of 2023, compared to approximately $5.4 million for the third quarter of 2022. The increase in expenses of $4.1 million was primarily due to increased clinical and manufacturing costs associated with our Phase 3 HOPE-3 trial. Excluding stock-based compensation, our general and administrative expenses were approximately $1.8 million for the third quarter of 2023, as compared to approximately $1.6 million for the third quarter of 2022. The increase of $200,000 was primarily due to increased facility and personnel costs. And our net loss was approximately $6.4 million for the third quarter of 2023 and 2022. And with that, let me turn it back over to Linda -- actually, open up the line for questions first before we do that. Go ahead, operator.

[Operator Instructions] Your first question comes from Joe Pantginis from H.C. Wainwright. Please go ahead.

Thank you. [Operator Instructions] And your next question comes from Aydin Huseynov from Ladenburg Please go ahead.

Yes. Thanks, Aydin. Right now, we are not at liberty to state the exact dollar figure affixed to that interim futility analysis. Of course, as it hopefully is achieved, we will put more granular details out. So, stay tuned for that. And so, that’s kind of where we are at now. In terms of, the building milestones as we move forward towards approval, what we haven’t disclosed up to this point, but we are now at liberty to say is that, up to and including the time of approval is $100 million in potential milestones to Capricor. So, we are going to look to that to fuel, obviously, the expansion of CAP-1002 to Duchenne, as well as other efforts, in terms of product expansion. So, that will -- those milestones hopefully come due will total $100 million. Hopefully, that’s helpful.

Yes. This is super helpful. I appreciate that, AJ. Just to clarify, it’s $100 million including approval milestone? So, I imagine that you get the approval…

That’s correct. Yes, exactly. And look for our 10-Q to become available shortly, which will articulate this basically the same way I am saying it, but that should be put out there shortly.