Rob Fink - Vice President of Investor Relations Eric A. Rose - Executive Chairman, Chief Executive Officer and Member of National Biodefense Science Board.

Gregory R. Wade - Wedbush Securities Inc., Research Division Joaquin Philip Horton.

Good day, ladies and gentlemen, and welcome to the SIGA Technologies Quarterly Business Update Call. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the call over to Rob Fink of KCSA Strategic Communications. You may begin..

Thank you. And thank you, all, for joining us today. This is Rob Fink of KCSA Strategic Communications, Investor Relations consultant to SIGA Technologies. Hosting the call today is Dr. Eric Rose, Chief Executive Officer; Daniel Luckshire, Chief Financial Officer. Today's call is being simultaneously webcast and is available on SIGA's website.

A replay of the call will also be available in a recorded format on the company's website. Before we begin today, I would like to remind everyone that this conference call contains statements that constitute forward-looking statements.

A Safe Harbor statement covering this call will be read at the end of the call and can be found in the company's press release for financial results for the first quarter ended March 31, 2014. With that said, I'd like to turn the call over to Dr. Rose..

Thank you, Rob. Good afternoon, and thank you, all, for joining us. This call corresponds with the filing of our first quarter 10-Q. Since the filing of the first quarter 10-Q is so close in timing to the last investor call held in March, my comments on this call will be brief.

In the prior business update call, we summarized our progress and achievements over the past year, and importantly, we laid out our goals and plans for the future. I want to reiterate that we are excited about moving forward. SIGA has dramatically changed over the past series of years, and we expect the transformation to continue.

As such, our game plan is being carried out with purpose and focus. The Arestvyr business is an important component of our strategic game plan. This business is a significant cash generator and provides an efficient foundation from which we can grow.

To date, we have delivered approximately 1.2 million courses of Arestvyr, and we plan to deliver another approximately 825,000 courses by the end of the first quarter of 2015, with a preponderance of courses to be delivered in 2014.

With the support from the Arestvyr business, our cash and investment balance has grown to $107 million as of March 31, 2014. And we expect to generate gross proceeds of $104 million from product deliveries planned for the remainder of 2014 and the first quarter of 2015.

With the aforementioned growth in our resource base, we're now well positioned to pursue multiple areas of value creation.

The Arestvyr business is one source of potential value creation, whether it is through new domestic or international government contract for oral therapeutic Arestvyr or from new indications or forms of administration of the drug. Strategic investments are another potential source of value creation.

For instance, acquiring our in-licensing attractive development program could expand and broaden the scope of SIGA and could offer a favorable time horizon for value creation. Additionally, strategic investments could also benefit from being supported and supplemented by SIGA's existing infrastructure.

In sum, we believe we have a strong foundation with the Arestvyr business, and we believe SIGA is well positioned to invest in opportunities and initiatives that can drive growth, create value and leverage our existing infrastructure and skills. This concludes my prepared remarks.

Thanks for joining this investor call, and we'll now open the line for questions..

[Operator Instructions] Our first question comes from Greg Wade of Wedbush..

I wonder if you might provide us a bit of an update on the status of seeking FDA approval for Arestvyr, what you anticipate might occur over the remaining quarters this year.

Secondly, if there's any visibility at -- or when you might anticipate visibility into the government's potential follow-on ordering behavior? And when would you see the most precipitous damage to the supply chain occurring should you not get any insights into future orders?.

Thanks, Greg. So let me first start with the FDA approval. We have been working with BARDA and FDA to finalize a rabbit tox model to supplement the primate work that we have done. That's moved along very nicely. I think both BARDA and the FDA are receptive to where we are at this point.

And we think that, that -- the definition of that model will allow us to proceed with any remaining animal efficacy studies. We're quite confident of the performance of our drug in this model -- in this type of model. With regard to visibility into future sales from the government, I am certainly not in a position to provide any of that.

That's something that comes when it comes. I can't say anything more than that. In terms of our supply chain, we think that there is a strong interest on the part of BARDA to sustain the capability of our company to produce the drug, and I don't have any different viewpoint on that at this time.

So we think that there will be a mechanism for us to continue to have a viable mechanism of production of the drug for the foreseeable future..

Our next question comes from Joaquin Horton of Sterne Agee..

There has been a lot of press recently on Lassa fever, and I'm just wondering if you could kind of give us a status report on the divestiture in our non-ST-246 assets and when you might -- when we might see some sort of announcement..

I can't comment on -- exactly to give any firm visibility into when that might happen. Regarding Lassa fever, I agree there have been things in the press, and we think it's an important pathogen.

Right now, our read is that's in a constricted funding environment in Washington that the availability of funding for the procurement of a Lassa antiviral is not there. And I'd love to see that change, but I think that is the reality at this point..

So one of the other changes wasn't really going to invest in non-bio or evaluation in non-bio defense partnering opportunities.

Are we working towards that end?.

We're looking at -- I think as I said earlier, there are -- we are in a process of actively looking for other potential areas to deploy our expertise, as well as our capital. And I can't say anything more than we feel confident and comfortable with that process at this point..

Our next question comes from Fred Greenberg [ph] of GA Advisors [ph]..

The BARDA contract, which was, of course, originally substantially higher, are you able to make a case or are people working for you trying? I think management should be doing this or management usually does this to make a case to BARDA that they need to fill out the whole contract.

I don't think there's any geopolitical reason that anything is getting safer in the world. I'm wondering if you have a program to lobby them or to speak to them or present to them or we just remain passive..

We are not passive. We have not been passive.

We think there is a good case for procurement of additional courses of our drug, particularly in light of the publication recently with the colleagues at the University of Pennsylvania on a potential role of our drug quantitatively in decreasing mortality and morbidity after an outbreak and shortening potentially the time course of an outbreak.

We think there is a lot of value to be had on the part of our government and other governments to have a smallpox antiviral in addition to vaccine as part of a program to deal with a smallpox outbreak. We think we are articulating that well.

We think there is an evidence base that we are helping others to accumulate to analyze just this and that the best way for us to make the case is to have that kind of information. So the short answer is yes, we are actively advocating for ourselves and the value and benefit of our drug, but I can't say anything more than that..

Well, that's good.

You see that Sanofi announced the results of their dengue project the other day?.

We saw the top line results, and I can't comment -- we certainly are aware of them, Fred [ph]. I think there are lots of questions about them. We, like Sanofi, believe that there is a potentially substantial market in dengue products, but I can't say anything more than that..

What is the most important thing you would tell a new shareholder? Obviously, the stock is not reflecting any future confidence, almost at its 52-week low, about the dengue project that would cause some excitement like all the hundreds of other companies out there who talk about their pipeline?.

I would say that SIGA is a scientifically tested and proven company at this point and developmentally proven and tested company at this point, smallpox being the first example. I don't know if dengue will be the second example or not.

But we've made a very successful product in Arestvyr, and we are more than confident that we've got the skills, resources and ability to do it again, and we will..

So you still say you're actively involved with looking for a partner for the dengue.

Does dengue products have a name, by the way, a chemical name, a scientific name?.

It does not have a chemical name..

Why is that? Usually, when you invent a new product with a partner, it has a name..

That's a good question, but I don't want to keep everybody on the line..

Okay.

But would you say that as before the first quarter or the year end that you're "actively" involved in partnering activities?.

I can't put a timeline on it..

No, I didn't ask for a timeline.

As I just said, are you actively involved in partnering activities?.

Yes..

Okay.

We haven't dropped it, in other words?.

No, absolutely not..

And at this time, I'd like to turn it back over to Rob Fink for closing remarks..

Great. Thank you, all.

As a reminder, this call included certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, including statements regarding the efficacy or potential of products, the timeline for bringing such products to market and the continued development and possible eventual approval for such products.

Forward-looking statements are based on management's estimates, assumptions and projections and is subject to uncertainties, many of which are beyond SIGA's control. Actual results may differ materially from those anticipated in any forward-looking statements.

Factors that may cause such differences include the risk that potential products that appear promising to SIGA or its collaborators cannot be shown to be effective or safe in subsequent preclinical or clinical trials; SIGA or its collaborators will not obtain appropriate or necessary governmental approval to market these or other potential products; SIGA may not be able to obtain anticipated funding for its development projects or other fund needed; SIGA may not be able to secure funding from anticipated government contracts and grants; SIGA may not be able to secure or enforce sufficient legal rights in its products, including patent protection for its products; any challenges to SIGA's patents and other proprietary rights, as is adversely determined, could affect its business and even if determined favorably could be costly; regulatory requirements applicable to SIGA's products may result in the need for further or additional testing or documentation that will deploy or prevent seeking or obtaining needed approvals to market these products; the U.S.

Biomedical Advanced Research and Development Authority may not complete the procurement set forth in its solicitation to the acquisition of the smallpox antiviral for the Strategic National Stockpile or may complete it on different terms; any contractual award we may receive to supply the smallpox antiviral may be subject to 1 or more protests, which may cause contract awards to be delayed or denied; the volatile and competitive nature of biotech industry may hamper SIGA's efforts; changes in domestic and foreign economic marketing condition may adversely affect SIGA's ability to advance its research or its products and may affect its federal, state and foreign regulation on SIGA's business.

More detailed information about SIGA and risk factors that may affect the realization of forward-looking statements, including the forward-looking statements in this conference call, is set forth in SIGA's filings with the SEC, including SIGA's annual report on Form 10-K for the fiscal year ended December 31, 2013, and in other documents SIGA has filed with the commission.

In addition, the risk of what appears now to be attributes of our lead candidate compound may turn out to be different as development progresses; the risk that our lead candidate compound may not at any point fail to meet our development objectives; and the risk that the expense, unpredictability and extraordinarily time-consuming process of developing drugs may prevent us from ever realizing any value from these efforts.

SIGA urges investors and security holders to review documents free of charge at the commission's website at sec.gov. Interested parties may also obtain these documents free of charge from SIGA. Forward-looking statements speak only as of the date they are made, and except for any obligation under U.S.

federal security laws, SIGA undertakes no obligation to publicly update any forward-looking statement as a result of new information, future events or otherwise. Operator, that now concludes the call. Thank you very much for joining us..

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program. You may all disconnect. Everyone, have a great day..