Good day, and welcome to the Aethlon Medical Fiscal Second Quarter 2025 Earnings and Corporate Update. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Michael Miller with Rx Communications. Please go ahead.

Thank you, operator, and good afternoon, everyone. Welcome to Aethlon Medical's fiscal second quarter 2025 earnings conference call. My name is Michael Miller with Rx Communications. At 4:15 p.m. Eastern Time today, Aethlon Medical released financial results for its fiscal second quarter ended September 30, 2024. If you have not seen or received Aethlon Medical's earnings release, please visit the Investors page at www.aethlonmedical.com to view it. Following this introduction and the reading of the company's forward-looking statement disclaimer, Aethlon's Chief Executive Officer and Chief Financial Officer, James Frakes; and Aethlon's Chief Medical Officer, Dr. Steven LaRosa, will provide an overview of Aethlon's strategy and recent developments. Mr. Frakes will then make some brief remarks on Aethlon's financials. We will then open up the call for the Q&A session. Before I hand the call over to Mr. Frakes, please note that the news release today and this call contain forward-looking statements within the meaning of the Securities Act of 1933 as amended and the Securities Exchange Act of 1934 as amended. The company cautions you that any statement that is not a statement of historical fact is a forward-looking statement. These statements are based on expectations and assumptions as of the date of this conference call. Such forward-looking statements are subject to significant risks and uncertainties, and actual results may differ materially from the results anticipated in the forward-looking statements. Factors that could cause the results to differ materially from those anticipated in forward-looking statements can be found under the caption Risk Factors in the company's annual report on Form 10-K for the fiscal year ended March 31, 2024, the company's most recent quarterly report on Form 10-Q and in the company's other filings with the Securities and Exchange Commission. Except as may be required by law, the company does not intend to nor does it undertake any duty to update this information to reflect future events or circumstances. With that, I'll now turn the call over to Mr. James Frakes, Aethlon's Chief Executive and Chief Financial Officer. Jim?

Thank you, Mike, and I would like to thank all of you for dialing in. This is Jim Frakes. In October, as reported, Aethlon's Board of Directors appointed me to serve as the company's permanent Chief Executive Officer. I have served as Interim CEO since November 2023, and I look forward to continuing my role on a permanent basis. As you know, Aethlon Medical is continuing the research and clinical development of its Hemopurifier, a blood - a therapeutic blood filtration system designed to bind and remove harmful exosomes and life-threatening viruses from blood and other biological fluids. These qualities of the Hemopurifier have important potential applications in oncology, where cancer-associated exosomes may promote immune suppression and metastasis in life-threatening infectious diseases and in organ transplantation. As a reminder, the two goals that I stated were our key objectives when I was appointed Interim CEO were to move the company forward in oncology and to reduce our expenses in order to streamline operations. As you will hear shortly, and as I'm happy to note, we made measurable progress on both of these fronts during the latest quarter and into the current period. Specifically, our emphasis on expense reductions has allowed for optimized resource allocation. This, in turn, enabled our continued work on the high-impact area of oncology. And I'm very pleased to say that we advanced our oncology trial efforts in Australia during the latest quarter and into the current period. I'm gratified by this progress and expect that our shareholders will ultimately be rewarded by our efforts. I will now turn the call over to Dr. LaRosa, who will give you an update on our oncology program to date, including one important milestone that we recently achieved and on other potential upcoming milestones we expect to report later this calendar year. Steve?

Thank you, Jim. First, I will discuss our Australian oncology study. As most of you have hopefully seen, earlier this week, we announced that the first patient was enrolled at the Royal Adelaide Hospital in Adelaide, Australia. And we are excited to update that now with the enrollment of a second patient from the same hospital. This marks a critical milestone for our oncology program and also constitutes great progress in the 6 months since we announced that we had preclinical data to support going forward with the clinical trial. Additionally, Pindara Private Hospital, in Gold Coast, Australia is now open for patient enrollment and is actively screening for eligible subjects. Going forward, we expect to continue to enroll patients in this safety, feasibility and dose-finding trial of the Hemopurifier in patients with solid tumors who failed treatment with anti-PD-1 antibodies. Two observations would support this. One is we're seeing active prescreening logs from our sites, and we are heartened by the fact that patients, as indicated by the 2 we've enrolled, have thought the study interesting enough and important enough to go ahead and signed informed consent to be in the trial. We are awaiting full ethics board approval from a third Australian hospital located in Sydney. The Aethlon team recently visited Australia between the 9th of October and the 16th of October of this year. On October 10, we had a site visit with the lab of Professor George Grau at the University of Sydney, who will be performing the central lab extracellular vesicle and T cell studies on samples from patients enrolled in the study. On October 11, we had a highly interactive investigator meeting with members of all 3 Australian sites clinical research teams. This was then followed by individual site visits to all 3 clinical…

Thanks, Steve, and good afternoon again, everyone. I will try to keep our financial overview brief with a focus on key points. For a more detailed analysis, you can refer to the financial statements attached to our earnings release that just hit the wire or in our soon-to-be filed quarterly report on Form 10-Q. As of September 30, 2024, Aethlon Medical held a cash balance of approximately $6.9 million. For the fiscal quarter ended September 30, 2024, our consolidated operating expenses were approximately $2.9 million, which was a decrease from $3.2 million in the same period of 2023. This decrease of approximately $300,000 or 9% in the 2024 period was primarily driven by a decrease of approximately $600,000 in professional fees that was partially offset by an increase of approximately $200,000 in payroll and related expenses and approximately $100,000 increase in general and administrative expenses. The approximate $600,000 reduction in professional fees was mainly attributed to several factors: a $300,000 decrease in legal fees following a transition to a new legal firm, a $200,000 drop in contract labor expenses following the completion of projects with contract manufacturing organizations and R&D consultants and an $81,000 decline in accounting fees. The approximate $200,000 increase in payroll and related expenses was largely driven by $500,000 in separation expenses, related to severance agreements following the termination of an executive and a workforce reduction. However, this increase was partially offset by a $200,000 reduction in ongoing payroll expenses and a $100,000 decrease in stock-based compensation due to completed vesting and expiration of options associated with our reduced headcount. General and administrative expenses increased by $100,000, mainly due to a $163,000 increase in costs related to our ongoing oncology clinical trial that Steve just discussed. That increase was partially offset by a $33,000 reduction in supply expense following the completion of R&D projects, along with a combined $20,000 decrease related to conference and insurance expenses. As a result of the factors I just noted, our net loss decreased to approximately $2.8 million in the fiscal quarter ended September 30, 2024, from approximately $3 million in the same quarter of 2023. Now I would like to note and emphasize that if we exclude the $500,000 provision related to an employee termination, our operating expenses decreased by approximately $700,000. We included these earnings results and related commentary in our press release issued this afternoon. The release also included the balance sheet for September 30, 2024, and the statements of operations for the 3 and 6-month periods ended September 30, 2024 and 2023. We will file our quarterly report on Form 10-Q following this call. Our next earnings call for the fiscal third quarter ending December 31, 2024, will coincide with the filing of our quarterly report on Form 10-Q in February 2025. And now Steve and I would be happy to take any questions that you may have. Operator, please open the call for questions.

We will now begin the question-and-answer session. [Operator Instructions] Our first question comes from Marla Marin with Zacks. Please go ahead.

Thank you. Hi. So I have a few questions, if that's okay. I wanted to follow up on the launching, initiating patient enrollment in the study in Australia, which is obviously really exciting now in terms of moving forward. Okay. So since this is designed to be a basket study, are the first 2 patients who have been enrolled in the study representative of different solid tumor types?

Yes. Hi, Marla. Yeah, we're excited as well. So I'm glad to hear you're excited. Yes. So both of the patients have 2 of the tumor types that are described in the inclusion criteria. I don't want for the sake of patient privacy, I don't want to divulge a lot of clinical information about the patients. But yeah, they had 2 representative tumors for people who are treated with anti-PD-1.

Two different tumors.

Two different tumor types, yeah.

Got it. Okay. And then - so I'm guessing that training the staff and the people who will be involved at the third location in Australia made sense to do because you were visiting Australia anyhow. But is it reasonable to think that given that you put the time and effort into that training process that the company is highly confident that it will receive ethics committee approval at some point near term?

Yeah. The third site actually was able to piggyback on a prior ethics approval from another site since it's a central Ethics Committee Board in Bellberry. So we already actually have the ethics - a contingent ethics Board approval. We have to add on the radiation assessment. So that's how much - that's what's kind of adding on how much radiation people receive for X-rays has to be updated in there. So that's the only out. So we have a lot of confidence that, that third site in Sydney will come up. Again, the nice thing is they've been trained. We actually went to the site and trained the nephrologist, and we were actually on a Zoom training call again last evening with the nephrologist. So we think they'll come up pretty quickly.

Can you explain to Marla and the shareholders why they're ready - we're not giving them a dose...

So what I mean by the radiation assessment is you have to get - they want to - what ethics boards want to know is how many X-rays do you need just for the sole purpose of being in the study. And for this, it's actually literally just a chest X-ray to confirm that your central venous catheter is in the right spot. So it's actually very minimal radiation that you receive for radiology just to be in this study. But it's - again, it's a box that the ethics committees have to check.

Right. Okay. Got it. So it sounds like it's really just pretty pro forma at this point.

Yes. Yes. Yes. So we think we're getting there with that third site. And again, they're going to be ready to hit the ground running because they've been trained.

Right. Got it. Okay. And then lastly, can you just remind us of - and Jim, I think this is probably more for you, but can you please remind us of what the - the whole rebate procedure is in Australia or maybe it's not referred to as a rebate, the 43% tax benefit that you're anticipating. Can you remind us of how the process works and what the timing on that will be?

Sure, sure. And that is an important financial factor besides the very good medicine and excellent hospitals and principal investigators we're working with. So to spur the development of their life science industry, Australia has a 43% I believe they call it a tax credit, but it's actually paid in cash, not as a tax credit as we would call it here in America. So it's currently $0.43 on the dollar. So any dollar spent in Australia on the projects, one time a year, we can submit the data and then they cut a check thereafter once they go through the bureaucracy. So it's very attractive. It comes close to cutting the cost in half. So we're just going through the submission now for the previous year. There wasn't much to submit because we were just getting going, but that should be important in future years.

And the central lab we're using is in Australia, too, so we can apply that cost.

Yes.

To that credit.

Oh that's interesting. Okay. Okay. Thanks very much.

Thank you, Marla.

And the next question comes from Jeremy Pearlman with Maxim Group. Please go ahead.

Hi. Good afternoon. Thank you for taking my question. I'm actually on the line for Anthony Vendetti. Just two quick questions. Number one, I always thought in the past that the trial for India was actually just going to be part of this trial in Australia, just a separate branch. But now it seems reading the press release and on the call, it's a totally separate trial, but has the same safety endpoint. So just could you maybe explain a little why the - why you felt it necessary to hold two trials with the same endpoint? Thanks.

Yes. So when it comes to tumors as well as EV measurements and the population, there are differences in the genetics as well as in the comorbid illnesses between, say, a population in Australia and in India. So we thought it was important to keep those as two discrete data sets and not co-mingle them where there could be some confounding if there are differences in patient populations. But the designs, as you say, are the same, but we thought it was important to keep the patient population data sets distinct.

Okay. Understood. And then going back to the trial in Australia. So you have two sites that are enrolling patients, and it seems like a third is really just around the corner. And now you have - you announced the first patient enrollment just a couple of days ago and now second. Do you have any more better visibility into when you think you'll conclude enrollment and when we could expect any sort of data from the trial?

Right. So in terms of - remember, this is - it's designed as a sequential escalating cohort study where the first cohort gets one Hemopurifier treatment. The second cohort gets two and the third cohort gets three. There's supposed to be at least three completers in those three cohorts. But to at least give you a sense of where we are right now. So as you said, we've enrolled two patients. They've gone through their screening activities. There's a number of tests that are done just to confirm that they're eligible after they sign consent and they have. So they're in what's called the run-in period, which is a 2-month period during which they're getting their anti-PD-1 therapy alone, and they're getting EV measurements, extracellular vesicle measurements and T-cell activity measurements. And at the end of those 2 months, if their imaging reveals that their tumor is not improving, if it's stable or progressive disease, then they would get the Hemopurifier treatment. So based on the two patients that we have currently, those people would presumably if they have stable or progressive disease, get dosed with the Hemopurifier in January. Now that's when we get our first data in terms of safety, which again is the primary endpoint. That would be followed once the whole cohort is done. So I'm hoping there's more enrollment in the next - in this month and next month. When we're done with the whole cohort, 3 months after that, we would actually have our first tranche of EV data and T-cell data. So that would probably bring you out sometime into the summer of next year. So that would like - you're going to get safety data first and then there's going to be EV and T-cell data to follow. And that will be true as we progress to the other cohorts.

And we will report after we get the data for each cohort, Jeremy. We're not going to wait until the true end of the study.

Right. Understood. So is it also safe to say that because you have to have - you have this 2-month run-in period where you have to see if the patient responds to the anti-PD-1 treatment, so you might actually enroll more patients and then to play it safe because hopefully, some of them will respond and then for those who don't. So you'll have a larger pool to pull from?

That's right, right. So we're going to keep - for each cohort, we're going to keep enrolling until we have sufficient numbers to complete those treatment cohorts with Hemopurifier. So you're right. If you estimate 70% of people don't improve, you're going to have to enroll a few - probably a few more patients just to fill the cohort.

Okay. Understood. All right. Thank you for taking my questions. I'll hop back in the queue.

Thank you, Jeremy.

This concludes our question-and-answer session. I would like to turn the conference back over to Jim Frakes for any closing remarks.

Thank you again for joining us today to discuss our fiscal second quarter results. We look forward to keeping you up to date on future calls. Good-bye.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.