Good afternoon, ladies and gentlemen, and welcome to the Celcuity Second Quarter 2024 Financial Results Conference Call. At this time all lines are in listen-only mode. Following the presentation we will conduct a question-and-answer session. [Operator Instructions] This call is being recorded today, August 14, 2024. I would now like to turn the conference over to Maria Yonkoski with ICR Westwick. Please go ahead.

Thank you and good afternoon to everyone on the call. Thank you for joining us to review Celcuity's Second Quarter 2024 Financial Results and Business update. Earlier today, Celcuity released financial results for the second quarter ending June 30, 2024. The press release can be found on the Investors section of the website. Joining me on the call today are Brian Sullivan, Celcuity's Chief Executive Officer and Co-Founder; Vicky Hahne, Chief Financial Officer; as well as Igor Gorbatchevsky, Chief Medical Officer, who will be available during Q&A. Before we begin, I’d like to remind listeners that our comments today will include some forward-looking statements. These statements involve a number of risks and uncertainties, which are outlined in today's press release and in our reports and filings with the SEC. Actual events or results may differ materially from those projected in the forward-looking statements. Such forward-looking statements and their implications involve known and unknown risks, uncertainties and other factors that may cause actual results or performance to differ materially from those projected. On this call, we will also refer to non-GAAP financial measures. These non-GAAP measures are used by management to make strategic decisions, forecast future results and evaluate the company's current performance. Management believes the presentation of these non-GAAP financial measures is useful for investors' understanding and assessment of the company's ongoing core operations and prospects for the future. You can find the table reconciling the non-GAAP financial measures to GAAP measures in today's press release. And with that, I would now like to turn the call over to Brian Sullivan, CEO of Celcuity. Please go ahead.

Thank you, Maria, and good afternoon everyone. We appreciate your interest in Celcuity. We made significant strides advancing the clinical development of gedatolisib this quarter. Overall enrollment in VIKTORIA-1, our Phase III study evaluating gedatolisib plus fulvestrant with and without palbociclib as second-line treatment for patients with HR+/HER2- advanced breast cancer remains robust and on track. Our Phase Ib/II trial evaluating patients with metastatic castration resistant prostate cancer is also enrolling on schedule. And we further expanded the patient population eligible for gedatolisib, when we initiated efforts to launch VIKTORIA-2, a phase III study designed to evaluate gedatolisib, as a first-line treatment option for patients with HR+/HER2- advanced breast cancer. In our view, each of these three programs has the potential to generate blockbuster levels of revenue. If these three programs ultimately result in regulatory approvals, we estimate that nearly 200,000 late-stage cancer patients globally would be eligible to be treated with gedatolisib. We first announced our plans to conduct the VIKTORIA-1 study over two years ago in May 2022. At that time, we estimated that 65% of the patients enrolled would lack detectable PIK3CA mutations and were being signed to the study's PIK3CA wild-type cohort. And this assumption was used to estimate enrollment by cohort and in turn, the timing of events for primary analysis. We estimated that the threshold number of events required to trigger the primary analysis for this PIK3CA wild-type cohort of patients would be reached in the second half of 2024. And while the study's overall enrollment remains on track and robust relative to the estimate we made over two years ago, the total proportion of patients enrolled who have PIK3CA wild-type tumors has recently shifted lower. We now project that 60% of the patients enrolled in the study will be enrolled in the PIK3CA…

Thank you, Brian and good afternoon, everyone. I'll provide a brief overview of our financial results for the second quarter 2024. Our second quarter net loss was $23.7 million or $0.62 per share compared to $14.6 million net loss or $0.66 per share for the second quarter of 2023. Because these quarterly net losses include significant non-cash items, including stock-based compensation and interest, we also included in our press release non-GAAP adjusted net loss for the quarter ending June 30, 2024. Our non-GAAP adjusted net loss was $22.2 million or $0.58 per share for the second quarter of 2024 compared to non-GAAP adjusted net loss of $11.1 million or $0.51 per share for the second quarter of 2023. Research and development expenses were $22.5 million for the second quarter of 2024 compared to $13.8 million for the same period in 2023. Of the approximately $8.7 million increase in R&D expenses, $6.6 million primarily related to activities supporting the VIKTORIA-1 Phase III trial, and the initiation of the Phase Ib/II prostate trial and $2.1 million was related to increased employee and consulting expenses. General and administrative expenses were $1.8 million for the second quarter of 2024 compared to $1.3 million for the second quarter of '23. Employee and consulting-related expenses accounted for $0.3 million of the increase. Professional fees and other administrative expenses accounted for the remaining increase of approximately $0.2 million. Net cash used in operating activities for the second quarter of '24 was $18.1 million compared to $9.7 million for the second quarter of '23. We ended the quarter with approximately $283.1 million in cash, cash equivalents and short-term investments compared to $180.6 million at December 31, 2023. The increase of approximately $102 million in cash and cash equivalents and short-term investments was the result of several financing activities that occurred in the first half of 2024 and yielded net proceeds of $137.5 million. We closed on two financing activities in May, resulting in gross proceeds of $122 million and net proceeds of $115.5 million. The first activity was an equity financing, resulting in $60 million of gross proceeds with net proceeds of $56.3 million. The second activity was a debt offering, resulting in gross proceeds of $61.7 million with net proceeds of $59.2 million. Additional financing activities in the first half of the year resulted from one exercises of $14.2 million, accessing our aftermarket offering of $7.3 million and stock option exercises and employee stock purchases of $0.5 million. The $137.5 million was offset by year-to-date operating cash used of $35.1 million. I will now hand the call back to Brian.

Thank you, Vicky. Operator, could you please open the call for questions?

Ladies and gentlemen, we will now begin the question-and-answer session. [Operator Instructions] Your first question comes from the line of Maury Raycroft from Jefferies. Your line is now open.

Hi, thanks for taking my question. Just checking on the enrollment, I appreciate that the time line is moving a little bit. Based on the shift in proportion of wild-type and mutant populations, is it possible that the wild-type and mutant readouts could happen at the same time? Or are you confident that the wild-type and mutant readouts will be staggered? And secondly, is it fair to assume you'll do another update on enrollment in fourth quarter and provide more specifics on the plan for the readout at that point?

Thanks, Maury and thanks for your question. As far as the timing of announcement of results for mutated, we are maintaining our guidance that we would expect to have those results available sometime in the first half. We're enrolling the same number of patients in each cohort of the studies, wild-type versus mutant and 40% of the patients are mutated. So that enrollment period will take longer to complete, albeit a little bit sooner than we originally planned because of the higher proportion of mutated patients. But we are not changing our guidance at this time. And as far as updating enrollment, we will continue to update guidance as we have every quarter on when we expect to report top-line results.

Okay. Makes sense. And then for VIKTORIA-2 in the frontline setting, can you talk more about the safety run-in with the 12 to 36 patients. Why is there a range of patients that you could enroll? And are you assessing any variations with dosing strategy? And how long will you have to treat these patients?

I'll give you an initial high-level summary and then Igor could maybe fill in blanks. Essentially, the study is designed to evaluate, if needed various dose levels of gedatolisib to find the Phase III dose. If we don't need to reduce the dose of gedatolisib in the first cohort of patients that we are evaluating, then we'll be able to proceed with the data from that group of 12 patients. And then subsequently, if we find that we need to dose reduce geda, we would enroll another 12 patients and do the same thing again if we had to and enroll another 12 patients. So essentially depending on what results and the outcome of that -- of each cohort or one cohort will or may or may not lead you to enroll additional patients. As far as the thresholds, I mean it's a standard safety run-in design. Igor, maybe you could provide a little bit more color on that question.

Thank you, Brian. As Brian pointed, it's very straightforward, safety run-in, three dose level will be tested 12 subjects per each dose level. DLT will be assessed after 1 cycle of treatment is completed. It's very safe and straightforward event that has been discussed with the regulators and agreed upon. And to Brian's point, decision about initiation of randomized Phase III study could be done as early as completion of initial cohort's 12 subjects.

Got it. Okay. Thanks for taking my questions.

Your next question comes from the line of Tara Bancroft from TD Cowen. Your line is now open.

Hi, good afternoon. I was hoping you could tell us exactly what you are seeing now for the percentage of the split of wild-type versus mutant that you think you're observing now versus what your previous expectations were? And also just a point of clarification. By target enrollment, you mean completion, right?

Right, right. There is always variation. You may have patients in screening at the end of a period and enroll additional patients just because you can't -- not enroll patients that you've potentially already approved to screen once you hit that target, but completed enrollment is correct. So we were at 65% at the end of '23. And so over the course of '23, you would see fluctuations month-to-month, which is kind of expected fluctuations are normal. So again, we were cautious in interpreting variation, but because we ended the year at the target number we had set in May '22, nearly 18 months prior, we thought that -- that estimate was solid and what we would continue. Once we hit 80% enrollment, which we did recently, the wild-type cohort, and we are at 60%. We just decided that we should update our forecast to the current ratio -- cumulative ratio, which is 60%.

Okay. Great. And then -- so I guess, late Q4 for potentially meeting the event time-line. That would potentially fit into the San Antonio conference time line. Is this still maybe what you are primarily hoping for? Because I know that the abstract deadline it passed early to mid-July. So did you submit an abstract or plan on presenting there?

So we haven't -- yes, we are going to -- until we get -- have an announcement to make about the data. We aren't really going to go into details about what venue we'll be reporting that data. And it's going to be very situational, depending on the timing and relative to the next most relevant meeting. And so once the data is available, we'll report the top line as soon as we have it, and then we'll provide guidance on when we would go into more detail at a meeting or go into some detail in the announcement press release.

Okay, great. Thanks so much for taking the questions.

You’re welcome.

[Operator Instructions] Your next question comes from the line of Brad Canino from Stifel. Your line is now open.

Thanks for taking my question. Brian, I just wondered, can you talk about how the potential forthcoming approval of Roche's interval also factors into your clinical and regulatory strategy for frontline, at least for the proportion who will have the mutation? And also, how important is the ultimate label outcome around the metabolic parameter eligibility as you think about this? Thank you.

I'm not sure I understand your question regarding inavolisib as it relates to us. Are you asking that question about how that might affect our first-line study, Brad?

Yes.

We don't think it will because they're only evaluated patients who, a, had the PIK3CA mutation; but b, were -- didn't have -- we're not prediabetic or diabetic, which, depending on the estimates, you can narrow that indication down to 50% of the mutated population. So it really is not a drug that could fully treat the indicated population, which is women who have endocrine-resistant disease. And as a result, we're -- when we've reviewed this information with the FDA in several settings. So we are confident in our design and that's what we'll be evaluating. So we don't think that data will affect us. It provides, we think, validation of what we're doing. They showed in that population that the pathway is involved and inhibition of that pathway can do some meaningful treatment benefit. As far as what's on the label, the drug had been tested in patients without the strict limitations used in this most recent study, INAVO-120. I think the eligibility criteria were informed by the results in that study. And if I recall correctly, from data they reported, I think in 2021, where patients may have had a cutoff of A1c similar to alpelisib, I think in one of the cohorts they treated were roughly 40% grade 3 hyperglycemia. So I think it would be unlikely that the label wouldn't address the hyperglycemia risk and the fact that the drug has not been evaluated in patients who are prediabetic or diabetic. And to the extent doctors decide they want to ignore that based on the results that at least were reported on a preliminary basis in these other studies, it would seem that the likelihood of inducing Grade 3 hyperglycemia would be pretty significant. So I think that drug is a similar profile in some ways as alpelisib. They just narrowed their patient population, as a way to avoid inducing high levels of Grade 3 hyperglycemia.

Appreciate it. Thank you.

You’re welcome.

There are no further questions at this time. I would now like to turn the call over to Brian Sullivan, CEO of Celcuity for closing remarks.

Thank you very much for attending our call. We appreciate your interest in our company, and I look forward to reporting to you next quarter. Good evening.

Ladies and gentlemen, this concludes today's conference. Thank you very much for your participation. You may now disconnect.