Jeffrey Church - CFO Michael Tardugno - CEO Nicholas Borys - Chief Medical Officer.

Daniel Brims - Cantor Fitzgerald Keith Markey - Griffin Securities Jason Kolbert - Maxim Group Hartaj Singh - BTIG Mark Breidenbach - H C. Wainwright Barry Rubin - GLORIA Leo Gibney - James Thomson.

Good morning. My name is Kevin, and I will be your conference operator today. At this time, I would like to welcome everyone to Celsion’s Second Quarter 2015 Financial Results Conference Call. Today’s conference is being recorded. All lines have been placed on mute to prevent any background noise.

After the speakers’ remarks, there will be a question-and-answer session [Operator instructions]. I would now like to turn the call over to Mr. Jeffrey Church, Senior Vice President and Chief Financial Officer of Celsion. Please proceed..

Thank you. Good morning, everyone, and thank you for joining us today to discuss our second quarter 2015 financial results, which we announced this morning before the market open. Today’s call will be archived.

The replay will be available beginning tomorrow and will remain available by phone until August 24, 2015, and it will also be on Celsion’s Web site for 30 days.

Before we begin the call, we wish to inform participants that forward-looking statements are made pursuant to the Safe Harbor Provision of the Private Securities Litigation Reform Act of 1995.

You are cautioned that such forward-looking statements involve risk and uncertainties including, without limitation, the risk of clinical failures, delays or increased costs, unforeseen changes in the cost for our research and development activities; possible acquisition of other technologies, assets or businesses; and possible adverse action by customers, suppliers, competitors, regulatory authorities and other risks detailed from time-to-time in the Company’s periodic reports filed with the Securities and Exchange Commission.

Following our formal remarks today, we will open the call for questions. I’d like to turn the call over to Mr. Michael Tardugno, Chairman, President and CEO of Celsion.

Mike?.

Thank you, Jeff. Good morning. I’d like to start by thanking all of you for taking the time to join us for today’s call. I am here with Dr. Nicholas Borys, Celsion's Chief Medical Officer and Jeffrey Church from whom you’ve just heard, our Chief Financial Officer.

As always we are delighted to have this opportunity to update you on our progress and to take your questions. I have lot to cover this morning so I’ll go right to it.

For those who have been following us you know that Celsion’s strength lies both in the breadth of our research as well as our focus and we’ve leveraged both as promised as we have been promising you since the acquisition of EGEN to generate some -- what we believe are impressive results for the first six months of 2015.

As we record our announcements it’s clear that we have set the stage with for what is becoming very productive year for our company for clinical partners and for our shareholders. I’d like to make a few comments regarding our breadth. With the acquisition of EGEN this marvelous biology based early staged development company at Huntsville, Alabama.

We have become all of once a fully integrated company with proven capabilities from feasibility in preclinical programs, through sophisticated clinical studies and commercialization and with this acquisition all at once, as we get them say, all at once.

We have three oncology focused platform technologies in chemotherapy, immunotherapy and RNA therapy. With regard to focus I’d like to make four points. The combined assets of our company are highly complementary. Second they are based in nano-particle technology all.

Third, they are being employed in oncology research almost exclusively and fourth are all in the potential for short line therapy in combination with the standard of care which we believe offers a great advantage for clinical stage companies and clinic programs.

We’re advancing clinical trials in Phase 3, Phase 2 and Phase 1 we've started addressing some of the globally most important cancers of our lifetime, all of which has translated into significant progress. As you’ve seen over this last six months and let me highlight a few of our accomplishments.

We posted important advances in preclinical and clinical research with promising results in liver cancer, breast cancer and ovarian cancer. We continue to build a broad market opportunity for ThermoDox by simultaneously executing our clinical strategy while expanding our footprint and focus on opportunities in Europe and in Asia.

Additionally with our IL-12 GEN-1 immunotherapy we're building a profile within a rapidly expanding gene in immunotherapy's research community, distinguishing our position as the one company that combines both therapeutics that's the genetic material and delivering mechanisms, you have to have both to be successful and we do.

Our first targets for Gen-1 are in ovarian cancer and GBM brain cancer, using the body's natural defenses to work the standard of care medicines to fight these diseases. I point that we're data driven. It's clear that the data has been the foundation of our pipeline and the driver of our research interests.

Today I want to highlight examples of data generated from our product pipeline and discuss how we're leveraging these data to advance development of our portfolio. First I'll point out a recently reported overall survival findings from the HEAT study of ThermoDox in primary liver cancer which was unblended about 2.5 years ago.

As you might have independently concluded these data more than just a prior design for our confidence in the Phase III OPTIMA study.

Last week we announced results from the 285 patients' subgroup of HCC patients who received an optimized RFA treatment plus ThermoDox versus optimized RFA alone, with this week and this is important, the median overall survival for ThermoDox arm was reached, so by all accounts the data are stable and statistically significant in this well-bounded, well-defined subgroup, overall survival quarter after quarter as we have been reporting now for 2.5 years just continues to get better and better.

This recent sweep shows a 58% improvement in time to death with an even tighter statistical significance than last reported a p-value with a 0.0198. These findings translate to a greater than 2 year survival benefit over the optimized RFA group only, that's a 79 months survival over 6.5 years for the ThermoDox plus optimized RFA group.

Now with five years survival wildly recognized as the benchmark for cure, if we're right ThermoDox plus optimized RFA will be considered a curative treatment similar perhaps to less surgical resection.

These data are impressive not only to us but also to our Chinese development partner Hisun and may give us together added commercial options as we pivot to China the world's largest market for primary liver cancer HCC with greater than 400,000 new cases each year.

Just a quick progress report on the OPTIMA study which you know is currently in progress, we're evaluating ThermoDox plus optimized RFA versus optimized RFA alone in the 550 patient trial.

We continue to enroll patients in this trail across sites in North America, Europe and Asia Pacific with the exception of a clinical trial agreement to initiate the China cohort of 20 sites. We remain on track with our goals for this study. We're now enrolling patients at over 45 sites in 12 to 14 targeted countries.

The OPTIMA study is over 15% enrolled excluding China. Turning to the Phase II U.S. DIGNITY study in recurrent chest wall breast cancer, FDA has confirmed that the trial has met its primary endpoints with 17 patients enrolled and 13 patients evaluable. We no longer are enrolling patients from inclusion in our statistical evaluation but I promise Dr.

Borys we may keep the trial open and we will keep open for compassionate purposes for investigators who continue to desire to treat patients with this very important treatment option.

In addition to showing pharmacokinetic biocompatibility of two separate manufacturing sites investigators assessed overall response rates have been nothing short of remarkable in this highly refractory patient population.

Over 70% of patients in this study all of whom have failed 2 to 3 lines of prior chemo and radiation therapy, 70% in this refractory population have shown clinically meaningful objective durable responses and we know that durable local tumor control is a clinically meaningful endpoint, FDA agrees with us on that. We have it in writing.

So based on these data we are compelled, we feel compelled we're committed to for saying a registration of program in our position in ThermoDox plus hypothermia for breakthrough therapy status.

The application is in development and is plan for submission later this year assuming a positive response we will present you with our strategy for registration of program. In the meantime however we expect to present our findings from the Phase II study at the St. Antonio Breast Cancer Conference in December. So I promise we will keep you posted.

Another outcome of the U.S. DIGNITY study has been a very high level of interest from European researchers. The data from our review paper published last year drew the intention of some of the most well known European researchers in hyperthermia, last August they sales -- Dr. Borys and me to support the Euro DIGNITY study. Over the last nine months Dr.

Borys has been working with investigators from five countries and with a preliminary study design presented in ESHO, the European Society for Hyperthermic Oncology this past June in Zurich.

We are confirming the final protocol details which after multiple reviews we'll enroll 70 recurrent chest wall breast cancer patients and we’ll evaluate patients with standardized hyperthermia, standardized at all of the institutional sites plus ThermoDox over six cycles, plus external beam radiation.

If all goes as planned we’ll begin enrolling in Europe in the fourth quarter of this year approximately 12 months after conception and we’ll roll the study out as many as six centers. The study is being conducted with the financial support from our hyperthermia partner Metalogix and institutional participants themselves.

Let me turn now to our early access program which we're continued to be quite excited about. We launched the European EAP with a company in Amsterdam who has many businesses, who is making it business in early access programs in the most responsible way. We launched this program about four months ago. The awareness campaign is in full swing.

And we just announced this morning as you may have read the expansion of this innovative -- initiative to include patients with primary liver cancer and with liver metastasis. As we have discussed in prior calls EAPs are restricted investigational drugs with high potential only.

This European exclusive physician directed program initially leverages our success in providing local thermal control to our four RCW patients and now we have the strength of our overall survival data to provide an opportunity to significantly improve outcomes for primary liver cancer patients who are considered candidates for radio frequency Ablation.

We believe that the EAP will not only further validate the potential for ThermoDox to serve as a much needed treatment but we'll also establish the base of expense when ThermoDox receives marketing authorization in Europe. We know that this is a drug with a noble mechanism that absolutely -- absolutely the mechanism works we know that.

We have shown that it can be safely administered; we know it can be manufactured with the highest quality levels and to our early access program we will generate experience, support and momentum and yet modest revenue.

And the last point I want to make here is that Mike is in active discussions with reimbursement authorities in key markets, once complete we have a great deal of optimism that ThermoDox will provide a benefit prior to approval for patients with fewer or no treatment options. So let’s turn now to GEN-1 our immunotherapy program.

GEN-1 is our synthetic non-viral delivery factor which we call TheraPlas which incorporates a DNA plasma that is encoded for the cytokine IL-12. IL-12 is a critical protein for stimulating and anti-cancer T-cell immune response.

When administered locally GEN-1 turns on the cellular machineries for local expression of IL-12 in doing so recruits the entire cellular immune system to drug cancer cells that escape the effects of chemotherapy and radiation and for thesis, which I believe we have established convincingly in preclinical and Phase 1 studies.

We’re evaluating GEN-1 and ovarian cancer and are completing a preclinical program in glioblastoma multiforme brain cancer. In ovarian cancer the company relied on a partnership with the cooperative GOG that’s a gynecology oncology group for two Phase 1 studies, one in a platinum sensitive and one in platinum refractory population.

The most recent study of Phase 1b in platinum refractory patients was completed this past December with patient data from the program presented at ASCO this past June.

In a small but significant group GEN-1 demonstrated clinical response rate that stable disease and partial responses in 100% to all of valuable patients treated at the highest dosing cohort. So in the comparison the historical outcomes in the difficult to treat cancer has indicated less than 50% clinical response rates.

These results were achieved without having reached a maximum tolerated dose for GEN-1. The next two clinical trials therefore will explore higher doses to ensure that we’re evaluating a best dose of GEN-1 for treating this difficult cancer. So these are my words, I’d like to share with you Dr.

Premal Thaker, the University of Washington Medical Center investigator in our Phase 1b at GOG trial. I’d like to share her comments from ASCO “Research formed an approximately 86% clinical benefit from all patients at the highest dose.

Highest dosage of GEN-1 combined with doxo had the most efficacy in patients as well as the highest level of stabilization of disease. These are significant because the lack of effective therapies currently available for the subgroup of patients.

This patient population is heavily pre-treated and do not have a lot of treatment options” These data well positioned GEN-1 for a trial in neo-adjuvant setting where patients typically had no prior treatment with immunosuppressive drugs.

Our next step is a Phase 1 trial of this design and that trial was submitted and accepted by FDA earlier this year, the primary goal is dose finding starting where the Phase 1b GOG study ended we will enroll 9 to 15 patients at up to five sites in the United States.

Following GEN-1 therapy patients in the study will be treated with the combination of docetaxel and Taxotere plus platinum therapy followed by surgery. We'll take samples, tissue samples at base line and following surgery to establish the relationship between higher doses of GEN-1 and its effect on the patient's immune system.

Slight initiation is clearly underway and we expect to be enrolling patients in this study in the second half of this year. Our plans are to complete the study then over a 12-month period. Data from this neo-adjuvant trial will be used to inform an important follow-on study, we've talked about this.

This follow-on study is designed to lead the way to a pivotal program that combines GEN-1 with Doxil plus Avastin which is currently the standard of care for patients who have failed a platinum treatment.

But we know about this synergistic -- what we know about this synergistic effect of combining GEN-1 with Avastin, we have quite a bit of preclinical data and what I can say is this, the power of this combination in preclinical study is remarkable.

Preclinical data we presented at the Molecular Medicine Tri Conference in San Francisco in February of this year show that when we added GEN-1 to Avastin in a murine model and implanted with disseminated sculptor ovarian cells, the tumor burden simply goes away.

Supporting our strategy our multiple preclinical study combining GEN-1 immunotherapy and Avastin, these studies have shown unmistakable synergy even in during dose levels of Avastin, observable reduction in tumor burden and disease progression is statistically significant.

These studies repeatedly show no obvious toxicities were associated with combined treatments and importantly the preclinical observations are consistent with a mechanism of action of GEN-1 which exhibits similar to Avastin certain anti-angiogenic properties by suppressing, VEGF, the protein responsible for new blood vessels formation.

Moving along now I would like to discuss briefly progress we have made with our TheraSilence our synthetic RNA delivery vector. During the second quarter we announced very promising preclinical data from the TheraSilence in lung cancer and pulmonary hypertension as well as directed delivery of RNA to lung in a nonhuman primate model.

These exciting results have captured the interest of a number of leading RNA therapeutic companies. We believe TheraSilence has potential applications in treating numerous lung diseases including cancers, pulmonary hypertension, pulmonary fibrosis, asthma and systemic cystic fibrosis.

And we have been meeting with multiple companies to explore the use of our TheraSilence technology to deliver RNA based therapies to the lung. This is a significant anti-field development for this form of therapeutics and one that we may be participating in exclusively with our delivery vector TheraSilence.

And before I turn the call over to Jeff, I think I'd like to mention our global focus for those of you following the Company you know this from our beginnings establishing a global footprint was and is a strategic issue for Celsion.

We believe we have positioned our pipeline and therapeutic focus for opportunities not only in United States but also in the European Union and in Asia, however the access program for ThermoDox in Europe certainly attracts this while very few companies have recognized the potential for execution of EAPs in terms of patient churn revenue we have done.

We have also expanded our studies in Europe from one country to seven from 5 sites to 20, from 1 trial to 2. And with positive data the EU will now become our go-to-market for early drug approval and adoption.

In keeping with our global mission, I would note that we have not missed the importance of targeting opportunities in the largest future markets for medicines in the world and that is China and Asia.

In that regard, we have two strategic partnerships in place one in each of the key markets Japan and China, our clinical studies include trial sites and 9 soon to be 10 Asian countries, we have expertly quoted key regulatory agencies and frankly we know the key thought leaders involved with our clinical research on the first name basis.

In a sentence we're shaping our global opportunities for success moving forward. Now with that, I'd like to turn the call over to Jeff for review of financials along with few comments regarding cash conservation initiatives.

Jeff?.

Thank you, Mike. Starting with cash, we reported total cash and investments at June 30, 2015 of $30.8 million, this compares to 37.1 million at the end of 2014. We [strike] that our balance sheet in the second quarter with an $8 million at the market registered direct equity offering with two institutional healthcare investors.

Cash used for operations in the second quarter of 2015 was $5.7 million compared to 4.2 million in the same period of last year. Cash used for operations in the first six months of this year were 11.6 million this compared to 9 million in the same prior year period.

Our cash used during the first half of 2015 was higher than the projected one rate that we expect in the second of this year and this was due to one-time manufacturing cost for clinical supply needs and for both ThermoDox and GEN-1 programs.

We now have sufficient inventories of clinical supplies for our global Phase III OPTIMA Study as well as the Phase I study; we have plans for GEN-1 immunotherapy in 2015, 2016. We do not expect to repeat this level of cash usage in the coming quarters due to the one-time nature of these manufacturing costs for clinical materials.

Each year we evaluate our annual spending projections as it compares to our current year operating budget. As part of this important process we had implemented several cost reduction initiatives to reduce operating costs by 15% to 20%.

We have evaluated our current organizational structure and have aligned our resources both personnel and clinical programs with our near-term development builds. We expect to reduce our operating cost by approximately $3 million to $4 million on an annualized basis.

We estimated our average cash usage for the operating activities of the company to be approximately $1.3 million to $1.4 million per month in the future and this is with the full implementation of the OPTIMA study and the integration of the clinical development programs of the newly acquired assets from EGEN.

We continue to monitor our cash expenditures to ensure the most efficient use of cash to create shareholder value. As of June 30th we project our operating horizon to be approximately two years taking us well into mid-2017.

We continue to maintain a strong cash position to advance the development of our product pipeline, including the expansion of the GEN-1 program a very exciting development for the company. Our current cash is projected to support operating activities well pass the announcement of many of the key development milestones Mike discussed earlier.

R&D cost were $3.7 million in the second quarter 2015 compared to 3.2 million a year ago. R&D costs were 8.2 million in the first half of 2015 this compares to 6.1 million in the same period last year.

The increased mirrors the increased cost associated with our expanded pipeline following the EGEN acquisition including GEN-1 and the TheraSilence program as well as the ramp up of be OPTIMA study and the cost associated with manufacturing clinical supplies which I’ve discussed above. G&A expenses were 1.8 million in the second quarter of 2015.

This was down about $0.5 million or 20% from a year ago. G&A expenses in the first six months of 2015 were 3.8 million; this was down almost $1 million to 20% over prior year level. These decreases were due primarily to lower insurance premiums and head cap reductions as all part of continuing review of our operating expenditures.

I’ll now turn the call back to Mike..

Thanks Jeff. As Jeff mentioned we ended the quarter in a strong financial position. We’re focusing our cash as he pointed out on research as oppose to overhead. And we believe we have sufficient funds to take us through many of the exciting upcoming milestones that we presented on today’s call.

So I'd like to conclude with this before we go to your questions. With the trials in Phase 3, Phase 2 and Phase 1 as I like to say in some of cancers globally most important forms. Celsion is extremely well positioned for success.

They’re making great progress with our platform technologies in chemotherapy, immunotherapy and soon some exciting announcements I hope will be coming from our RNA therapy.

Our strategy to advance clinical development in first line and the combination with the standard of care and only applies to ThermoDox it also expands to all of our immunotherapy and RNA delivery platforms.

Our [wages] in GEN therapy specifically focusing on having both drug and delivery mechanism along with our ability to target lung disease in combination, the combination that we believe no other company can match and tend to exploit this advantage with strategic partnerships, collaborations and to our own independent clinical research.

Our global approach is unique and requires patients. In the end however, we not only serve the interest of the patients and physicians we’re establishing a template with the potential for an extraordinarily oncology success focused research and development initiative.

Celsion has leadership, the technology and the experience in place to maximize our opportunities and to shape our strongest commercial potential. We believe the month and years ahead will continue to be transformative and exciting for you, for us and for cancer patients around the world.

So we greatly appreciate your interest in the company and we look forward to updating you on our progress as we continue to move forward with these very important clinical programs. With that now I’d like to welcome the call to questions. Please limit them to two to give everybody a chance to speak. Operator if you will please open up the lines.

Thank you. [Operator Instructions] We’ll take our first question from Daniel Brims. Your line is now open..

First question is on the HEAT study, the data you put out last week I noticed it was trending in the Chinese population but wasn’t reaching statistical significance of that.

What was the reason behind that?.

I’m going to ask Dr. Borys to comment on that one.

Would you mind Nick?.

Yes, there is two factors to take into consideration with the [Apex] of groups or countries of sub groups study. Number one that you might know that the HEAT study Chinese cohort started at least one year after the main cohort started because of we know the long time it takes to get through the Chinese regulatory hurdles.

So just now is the data starting to mature in China, so you're seeing that and we're very pleased to see that the data is just basically following the same trends that we saw the main body of the study population.

So with that we always felt that whether we use ThermoDox in the U.S., Europe, Asia or China we're getting very similar results and the Chinese population is beginning to verify that..

And my second question, the U.S. DIGNITY study as you said is fully enrolled, when do you and you're going to be presenting some data at St.

Antonio Breast, is that going to be the final data when do you expect us to see the final data for that study?.

Just a quick answer to your question, the final data will be presented at the St. Antonio Breast Cancer Conference. I think for the most part however Dan we’ve been keeping you and the investment community largely aware of the efficacy results as they have developed.

We call this an open level trial, so we've been providing interim information on an ongoing basis, but the final data presentation will be first heard at the St. Antonio Breast Cancer Conference..

We will take our next question from Keith Markey. Your line is now open..

I was just wondering, is type responsible for bringing the HEAT study data through the CFDA and do you have a sense of how the Chinese regulatory agency may view these median overall survival data that you reported?.

I mean the second part of your question might be a little speculative on our part.

So what I can say about our interactions with the CFDA, I mean generally quite positive, we have not met the agencies a number of times over the course of initial submission of the study and then again throughout the course of the study just to keep the regulatory officials aware of what we're doing.

Recently over the past maybe seven or eight months, we have met with the agency, I think I can say with our questions that we're encouraged with the results like any agency however they have some views about a retrospective analysis, and they gave us some thoughts on what might be appropriate next steps for the Chinese population separately from the rest of the world.

We think we're in a good position to evaluate those recommendations with the partner like Hisun and I think once we've completed our evaluation and we have Hisun's input we're likely to make an announcement moving forward Keith, but it'll be premature at this point to make any generalized statements in the panel like..

We will take our next question from Jason Kolbert. Your line is now open..

This is really financial, I know you've run through the numbers Jeff, they were pretty correct where you've talked two years worth of one way.

Can we go through what the R&D projection would be for 2015 and what it would be for next year 2016? And same question for G&A because that was too fast I didn't quite get it and based on my assumptions the numbers didn't add up?.

Unfortunately, I don't have the details in front me.

We do anticipate -- what I indicate in the first half of 2015 R&D, we had at 8.2 million and G&A for the first six months was 3.8 million and we anticipate the R&D to be coming down largely due to some high manufacturing cost for clinical supply and also some other areas where we've looked at the clinical programs et cetera.

And we've sort of indicated here with our guys that we've come down in the neighborhood of 15% to 20% over these numbers in the first half of the year. And I would say a similar sort of 15% reduction also the G&A due in large part to some organizational structural changes that we'll be implementing in the second half of the year..

But still, I mean, if I -- even if I use 15% reductions I end up showing our burn rate of call it 20 million in 2016 plus the second half of 2015.

So I am trying to understand how you can say that you have cash for the next two years worth of operations even with the 20% reduction I am closer to six quarters?.

Here again based on also what our projection is on a monthly basis moving forward of 1.3 to 1.4 but easing those projections it’s around 22 to 24 month. I’ll take a look and we can talk why but these are the current projections….

I won’t understand because in the second quarter of '15 I guess on a quarterly basis you came in at 5.3 and maybe we could just chat offline.

And looks -- switch gear and talk a little bit about this partnership that you announced this morning, can you talk a little bit about how that came about and how that might change the trial timeline, so I'd be very appreciative to better understand that..

Jason, are you talking about the early access program?.

Yes..

So the early access program operates independently from our clinical trials and we’ve expanded it from RCW patients exclusively to include now patients who are treated with liver disease and that includes metastasis to the liver as well as primary liver cancer patients who are indicated for Radio Frequency Ablation.

The implications for clinical trial are for the most part de minimus we will not -- in study centers where the clinical trials are ongoing we will not make the early access problem available in centers outside, in institutions including community hospitals who are using Radio Frequency Ablation to treat these patients and our objective will be to provide them with sufficient awareness so they understand the potential value all the data in not in but understand the potential value of combining ThermoDox with Radio Frequency Ablation assuming that Radio Frequency Ablation is controlled properly every flex fee, amount of fee required to probably ablate the tumor of significant size.

So we don’t see any either the synergy or conflict with the --.

So that's what I’m trying to understand the risk versus benefit here because you have a drug that’s currently in a pivotal trial and you’re going to be treating patients with the drug outside the trial.

So it seems like on the one hand you’re using this as kind of awareness marketing prelaunch but on the other hand isn’t they’re regulatory risk, you have to track these patients. So I’m trying understanding that’s very unusual situation where you have a pivotal right but you’ve been actually treating patients with the drug outside the pivotal trial.

So that’s why I don’t quite understand this.

So it maybe unusual for the moment but I think you’re going to find this approach appeals to quite a number of companies who have convinced they have a drug they can produce to GMP standards who have a history of using the investigational product in sufficient number of patients to be confident in the safety profile and who are working with the company like myTomorrows who insist on protocol compliance as well as follow very carefully the outcomes of patients.

So we have treated in the EAP. We’ve looked at the risk, reward potential here. We believe properly executed that the EAP represents an opportunity that does not expose us to a great deal of risk..

We’ll take our next question from Hartaj Singh. Your line is now open..

Just one quick one on the EAP will you have to go through the regular negotiations country-by-country, get reimbursement and then start signing on patients meaning that I would imagine about a 12 month process.

And then just remind with that is that would you have to go through the reimbursement negotiations separately for each label meaning the each indication like chest-wall you have one set of negations for liver -- and anther one or will they be sort of joined together as you go through Germany, France, UK et cetera?.

So pricing is not negotiated, let me start there Hartaj. So we have a statistic price which depending upon the market and maybe even the institution we're prepared to make some allowances depending upon the individual circumstance. So EAP afford this quite a bit of flexibility in that regard.

What the bottom line is that we take this value inherent in this investigational product at this point so it’s not a give away by any means. The process for establishing payment is opposed to reimbursement. So, since we’re operating outside of what's considered to be the approved drug.

So, unregistered medical products UMPs in Europe have a status by law.

They are not -- the pricing is not established through the normal negotiation means of the regulatory authorities in each of the countries, they're in many cases the pricing is established with local institutions who have budgets for these kinds of procedures and some cases the national health authorities have small budgets set aside relatively small budgets set aside for payments for these kind of procedures.

These countries are little bit different and that's why the expertise of a company like myTomorrows is important to making sure that we're getting appropriate awareness in that patients and physicians and institutions are aware of the costs.

But the last point I try to make and I'd like to make is that in some cases prior to arriving at an agreement with an institution or local authority patient made very well pay for this therapeutic on their own, so it could be private pay..

And then you will -- just the different like chest wall, liver mets will those be negotiated separated I guess with local institutions or government or they'll just -- if you just get approval for one you should start getting reimburse with the others also?.

Yes, I can't answer that with confidence because each I think -- as I pointed out, each one of the countries and by institutions is a separate discussion, has opposed the negotiation..

And then other just the housekeeping matter is that, I saw you share comps at 19.96 million for this year but with the registered direct that you did, it seems your share stayed stable between first and second quarters, so is that I am just missing something because that was in the second quarter right, so shouldn't your share count have gone up?.

It should have, so I think it's 23 million at this point, right..

Got it, so that's the fully diluted..

We will take our next question from Mark Breidenbach. Your line is now open..

I was wondering first if you could just speak to the underlying reasons behind the delay and opening Chinese sites for OPTIMA?.

Let me start by saying that while we're waiting for the clinical trial application the work is way through the approval process. We have been negotiating contracts with each of the sites. We have the IRP or F6 committee's submission ready to go. We are not unique so that being said we're not unique in this long review and approval process.

The Chinese government has a great deal of transparency associated with clinical trial applications. If you are conversant you can read Chinese, you are welcome to look, but the CFDA allows sponsors and the public to track the progress of their review online. So there is a Web site devoted to this information.

And what we know this is we're not unique and taking a long time for this clinical trial application review, it was reported in one of the local newspapers that the backlog of clinical trial applications that the CFDA is considering is about 18,000 applications and that information is about six months old.

So there is an enormous amount of interest in clinical studies in China and the backlog is beginning to reflect in more applications, I'd say that's number one.

And now I'll speculate with you a little bit too as the Chinese authorities are looking also for us to make sure that our clinical trial applications in the acceptance of those applications are up to world standards, global standards because we've seen over the course of our experience with the CFDA a very aggressive move towards modernization adopting practices and principles that we would consider to be consistent with those in of USFDA and of the EMEA.

So implementation also as we see as we talk to the sensible to CFDA, and we do quite often implementation of those practices and programs requires training and additional resources.

So I guess the bottom line this is -- there is -- we're in a queue and there is nothing that it's apparent to us and obviously we would know, but there is no hesitation from a quality of the study standpoint..

Then let's switch gears quickly to GEN-1, I think I heard that the results of the neo-adjuvant planned study are going to be used to inform the follow-on study in combination with Avastin.

Does that mean that the follow-on study with Avastin would not initiate until late 2016?.

I think we can say that depends, so if I mean those things are -- so our plan is to initiate the Avastin plus Doxil plus GEN-1 study in the first of 2016 and I think more on track for that. Initiating the neo-adjuvant study which we expect to be relatively soon.

Getting patients onboard -- the dose that we left off in the prior study in Phase 1b study, completing that cohort and moving to the next level, so we move to the next dosing level safely could likely inform the starting point for the Avastin study.

So if we complete the evaluation of higher doses in the neo-adjuvant study obviously that would be basis for the starting point for the GEN-1 plus Avastin program.

However if we are to hire those and still not have completed the neo-adjuvant study we would likely start at the higher dose but not the final dose that would be enlightened in the neo-adjuvant, is that make sense?.

Yes, what about the GBM study, what are you thinking in terms of timing for that one?.

I don’t -- I think we can definitely give you a timeline. So we’re just kind of curious with where we are at.

We’ve completed a range of studies combining GEN-1 with temodar, temozolomide is an alternative standard of care therapy for these patients following our section and the standard of care indicated in the MCC and guideline appears to us to the BCNU clear their way for us following surgery.

So we have a great deal of safety data and efficacy data in a preclinical model for combining GEN-1 with BCNU, I don’t know that's very good, very promising. With temodar be a treatment also -- by the way treatment at temodar also includes radiation following surgery.

So the radiation component we have yet to complete, so we complete that successfully. We are currently in discussion with key opinion leaders, surgeons, neurosurgeons, neuro oncologist who treat these patients. We could have a clinical protocol design completed based on the final safety study is covered our radiations.

In time for a submission at the very end of this year the first quarter next year for an IND submission, so that’s the status..

Our next question comes from Barry Rubin. Your line is now open..

I have a one question if you would be so kind, on the GBM it’s rather difficult thing to resolve as you know medically is there any way that you can tell us what would make our drug different in a more efficacious manner than other items that are out there now?.

Jeff you want to take that?.

My first reaction to your question would be what makes GEN-1 unique to everybody else is that we are a regional therapy IL-12 as you know was a very powerful modulator at the immune system and previous studies when you gave IL-12 systemically was limited by toxicity very much like traditional chemotherapies and now with our technology we are going to be applying the drug locally where it acts locally on the tumor.

So we could apply it during the time of surgery when the tumor is being excised from the brain and the idea would be to apply it that time and as Mike said with the BCNU wafers. No other technology can do that so that’s what I think makes us unique..

Our next question comes from Leo Gibney. Your line is now open..

I wanted to follow up or comments or question earlier about the China you gave us the data for the update on the HEAT trial and the crave out for China. The results were similar but it wasn’t statistically significant.

I’m wondering does China require that a crave out for their country or any other countries acquire as you know you lose statistical power if you have to start carving out the data of these regulatory authorities require it. And so I was wondering if you could speak to that? And then also the 15% enrollment in the OPTIMA.

Are you on track with that it seems that would be quite a while before enrollment is completed in that too? Those are my questions..

Let me just answer the last question first. So it takes a great deal of time to initiate study sites literally around the world it's not unique to us. So from the time we’ve got we received regulatory approval for trial in the U.S. we then have to submit our trial to regulatory authorities in 12 other countries but you just have to take some time.

Subsequent to the regulatory approval then we have identified, usually pre-identified number of investigator sites. In our case we’ve identified 75, 20 of which are in China. We've pre-identified the sites, we've begun negotiating clinical trial agreements which can take 3, 4, 5 or sometimes 6 months. We have a study site in Italy in Ferrara.

I think we've been negotiating the clinical trial agreement with that site now for almost 12 months believe it or not and it's just assuming quite a bit exacerbating and we use I think a CRO as good as any with legal resources better than most, and this has -- certainly has our attention.

So the point I try to make -- and then following clinical trial agreement, we have an Ethics Committee review or an IRB review maybe the term you're more used to, so it's in the IRB it takes 4 or 5 sometimes 6 weeks to complete their review and make a formal announcement then we initiate the study.

One at a times we open up the study sites, so that the picture I am trying to paint for year there is a waterfall of activity that requires to go from zero to 100 and that usually takes about a year, so what you're seeing as we open trial sites then we begin to enroll patients.

So you're seeing now that now we have I think maybe outside of China two more sites to initiate. So it's taking us with a great deal of focus and what we consider to be I think by any standard of measure a relatively short period of time to get the study up and running.

So now we have firstly all of the sites outside of China participating and our expectation is that we will see enrollment consistent with a full split of -- excuse me the trial sites. Consistent to that we're tracking the Chinese process very carefully.

We haven't learned how to read Chinese yet, Nick or I have not, but we certainly do have someone to translate it for us, so we look every quick and where we stand we follow approval.

I think the last time we looked we were number at 45 on the list, which means we could be seen in our clinical approval sometime before the end of the year, we certainly hope so. Assuming that we could move very quickly I believe to initiating the China site and we're -- the China's site.

I think Nick answered a question earlier and I want to be clear about this, so Nick answered that question earlier about the maturity of the data coming from the Chinese cohort vis-à-vis the overall survival analysis..

It wasn't so much the maturity of the data, but just the fact that they might, do they require that kind of carve out because you might let's say 60% improving overall survival which is great, but if you carve out just in its sub-segment you're going to lower your statistical power, you might not reach significant, I think Nick may know what I am talking about..

We completely understand, and I don't think anybody should underestimate the discipline in the scientific [regulatory] that CFDA requires of the new drug applications, so although we have -- where we have great deal of confidence in the, now having follow these patients for 2.5 years in the overall survival data it's still in fact retrospect.

So the questions remain and we have discussed this with CFDA we are not prepared to make any public announcement this point but on that basis now we have what we think is the reasonable recommendation for us to consider from CFDA..

And it appears we have no further questions at this time. I'll turn the call back to our speakers for any additional or closing remarks..

Well, again as we open up this call, I want to thank all of you for taking the time to join our teleconference, we're excited with the progress of the Company, we hope you are too. We look forward to continuing our dialogue with you as we progress our clinical programs across the Board. Thank you very much for your time and attention this morning.

We look forward for your participation on the next call..

This does conclude today’s teleconference. You may now disconnect. Thank you and have a great day..