Good day everyone and welcome to the CytoSorbents' 2014 Second Quarter Financial Results Conference Call. Today’s call is being recorded and at this time, I’d like to turn the conference over to Amy Vogel. Please go ahead.

Thank you, operator and good afternoon. Welcome to CytoSorbent's second quarter 2014 operating and financial results conference call. With us today are, Dr. Phillip Chan, Chief Executive Officer and President; Vincent Capponi, Chief Operating Officer; Kathleen Bloch, Chief Financial Officer; Christian Steiner, Vice President of Sales and Marketing from Germany. Before I turn the call over to Dr. Chan, I'd like to remind listeners that during the call management's prepared remarks may contain forward-looking statements which are subject to risks and uncertainties. Management may make additional forward-looking statements in response to your questions today. Therefore the company claims protection under Safe Harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from results discussed today and therefore we refer to you to a more detailed discussion of these risks and uncertainties in the company's filing with the SEC. Any projections as to the company's future performance represented by management include estimates today as of August 12, 2014 and the company assumes no obligation to update these projections in the future as market conditions change. During today's conference call, we will first have an overview presentation covering the financial and operational highlights for the quarter by Dr. Chan and Ms. Bloch. We again have taken everyone's submitted questions and will do our best to address them in the presentation, and also in the Q&A session with management to follow. Thanks everyone again for participating. If we do not answer your question, we would ask you contact the company directly after the call today. At this time, I would like to turn the call over to Dr. Phillip Chan. Please go ahead, Dr. Chan.

Thank you very much Amy and thank you to everyone for submitting your questions and making time to join the call today. Welcome. Unfortunately, Chris Cramer, our Vice President of Business Development is out sick, but I will cover some business development matters in my remarks. Following a short introduction for new and potential investors, Kathy will go over the financial progress for the second quarter of 2014 followed by a discussion of our Cardiac surgery trial for potential application of CytoSorb and Ebola treatment and case report studies and followed by Q&A period. I would also encourage investors to visit our website at www.cytosorbents.com to obtain a copy of earlier transcripts and presentation. A recent interview by the Wall Street transcript will be available on our website very shortly that cover some additional questions in greater detail. With that let me turn to slide four. CytoSorbents is an emerging leader in the $20 billion critical care immunotherapy space. We are leading the prevention or treatment of life threatening inflammation in the intensive care unit. Information plays a major role in nearly every known disease. This could be life threatening conditions like sepsis, trauma, burn injury, influenza, Ebola virus and others. It could also be in auto immune diseases like rheumatoid arthritis, inflammatory bowel disease, psoriasis and lupus, heart disease, peripheral artery disease, cancer, cancer cachexia, graft versus host disease, neurodegenerative diseases like Alzheimer’s disease, multiple sclerosis Parkinson’s, and many, many others. The unfortunate part is that uncontrolled inflammation wreaks havoc on the body and can be deadly. The problem with severe inflammation is that it can cause cell death, organ injury ultimately leading to organ failure. And organ failure is when vital organs like the heart, the brain, the kidneys, the lungs or the liver when they stop working…

Thank you, Phil, and good afternoon everyone. For today's call I will be providing an update regarding CytoSorbent's revenues and I will also comment on the company’s progress related to uplifting to a national exchange either NASDAQ or NYSE MKT. And as you will see the comparative financial results demonstrate our strong continuing revenue growth. For the first half of 2014, our total revenue was approximately $2.1 million which is an increase of 215% compared to total revenues of approximately $663.000 for the first half of 2013. Product sales for the first half of 2014 were approximately $1.2 million, which is an increase of more than 300% over product sales for the first half of 2013 which were approximately $304,000. Grant income and other income for the first half of 2014 was approximately $854,000, which is up 138% as compared to grant and other income of approximately $359,000 for the first half of 2013. Our first half blended gross margins were approximately 36% while our CytoSorb product gross margins were approximately 63%. Turning to the quarter ended June 30, 2014, product sales for the quarter were approximately $663,000, that’s a 418% increase over product sales of approximately $128,000 for the second quarter of 2013. Second quarter 2014 product sales were the highest quarterly product sales in the company’s history. Gross margin on these product sales in the second quarter of $214 were approximately 65%. Our grant and other income was approximately $361,000 for the second quarter of 2014 as compared to grant and other income of approximately $164,000 for the second quarter of 2013. Total revenue for the second quarter of 2014 was approximately $1 million, which is an increase of 252% compared to total revenues of approximately $291,000 for the second quarter of 2013. Now we’ll take a look…

Thank you very much, Kathy. Now I’d like to go over some items and questions that shareholders have submitted particularly as they relate to our U.S. cardiac surgery pivotal trial plans and the Ebola outbreak. Just to give you some background on cardiac surgery. There are approximately 1 million cardiopulmonary bypass surgeries in the United States and in the European Union annually. There’s another half a million in the rest of the world particularly in India and China. These are done for many different reasons. One of the most common is for coronary artery bypass graft surgery for blocked heart arteries. There is open valve repair, as well as cardiac defect repairing in congenital heart disease, for example, or lung transplantation as well as LVAD implantation, left-ventricular assist device implantation for heart failure. The problem with cardiac surgeries that patients develop inflammation due to many things that are associated with cardiac surgery starting from cracking open chest, stopping the heart from beating, bypassing the blood into heart lung machine, sucking up blood from the field with cardiotomy suction reversing heparin [anti-clog] with protamine and many, many other aspect of the surgery. This leads to a production of cytokines and activation of complement and a release of free hemoglobin that together works to induced inflammation causing cellular injury and organ injury ultimately leading to multiple organ failure particular lung and kidney failure. In high risk patients the risk of developing kidney and lung failure could be as high as 30%. There’s been no technology that has been able to easily introduce into the heart lung machine that is bypassing blood around the body to directly reduce cytokines storm complement factors, free hemoglobin and other inflammatory mediators expect for the direct washing of blood which can be cumbersome and problematic in certain…

Thank you Dr. Chan. Thanks. Over the last week we’ve collected the number of questions from investors. Question, could you please give us an update on sales and the development of the different markets?

Yes, of course. Thank you, Amy. We had another strong performance in the second quarter. We saw significant growth in sales in both our direct and distributor markets and are very much on track with how our sales trends causing in. Currently direct sales of CytoSorb still accounts for the majority of our product revenue and we were pleased to achieve our sales targets. There were many public holidays and -- come to nine bridging days in Germany that makes second quarter from a sales opportunity standpoint a short quarter. Reorder volume of direct sales probably the most important indicator of continued use and adoption accounts for most of our direct sales and short, healthy 25 quarter-over-quarter percent growth. At certain hospitals we are seeing that CytoSorb is being regularly used for specific indications. That is actually the first step to becoming standard of care at those hospitals. Although the majority of our sales efforts are focused on our existing customers, we continue to expand our new customer base as moderate quarter-over-quarter growth for new orders following a substantial increase in Q1. Our distributor business also continues to grow with strong reorder performance from Turkey and India in particularly. As mentioned we are waiting for higher product registration in Russia and the Middle East, which we hope to get soon as we just signed on Taiwan. To-date we have not yet have meaningful sales from these countries, however the dialysis and blood purification markets are very strong there and we expect these territories to be significant contributors to our revenue growth going forward. We also expect to expand distribution to a number of other countries by the end of the year and are on track to do so. We also intensified our marketing efforts as discussed during the two previous investor calls. CytoSorb therapy has been presented at several conferences by a number of users; product example at International Liver Transplant Society meeting in London by the use of CytoSorb after liver transplant has been discussed. What was particularly interesting was our CytoSorbents satellite symposium at the joint meeting of the German and Austrian society for internal medicine and critical care physicians. The attendance of our symposium was completely full; it was almost 20% of the whole conference participating in our session. Furthermore, we have been invited by certain potential strategy partners to inform their customer while this new extra corporate therapy at specialized conferences. We have been participated in two of these meetings in Germany already and the third one is plan to take place in Berlin later this year.

And what do you think is needed to establish CytoSorb as a standard of care therapy for septic shock or other indications?

Severe sepsis and septic shock are our largest target markets. They count for 10% to 20% of all ICU admissions. In other countries such as India nearly a quarter of all ICU patients have sepsis, but sepsis are very complex disease and not seeing the patient is exactly alike. Historically this has made sepsis very difficult to treat. We believe that CytoSorb attack sepsis in many ways that has not been possible before. CytoSorb works through use cytokines storm to control deadly information which can also remove certain bacterial toxins and importantly it can have redirect the activated cellular immune system to target the infection and avoid injury to healthy organs. To make CytoSorb standard of care for sepsis requires that we develop strong medical evidence that therapy works and that we collaborate with medical societies both nationally and internationally. We are currently considering a larger scale randomize controlled trial in sepsis to take place in Germany that would help answer this question. In the meantime we have many investigator initiated studies in severe sepsis and septic shock that are either enrolling or are planned that will help generate additional data. Furthermore, our International CytoSorb Registry, which will help collect data on how CytoSorb is best used, is currently online and in [data] testing, so official launch is planned for World Sepsis Day in September. Also as discussed earlier, we continue to seek [medi case] report where CytoSorb has worked extremely well. We take these cases and try to learn as much as possible from them. Finally we need to show evidence also economic benefit in order to achieve reimbursement worldwide. For CytoSorb if we can save just one or two days in ICU to some people who already pay for it? We have seen this already many times. We plan to include cost effective measures in all of our major clinical trials.

And when we’ll begin to see the data?

We currently are concentrating our efforts in Europe to generate appropriate medical evidence and are making a lot of progress. During the last quarter two case reports in intensive care medicine and the 20 versus 20 patient retrospective control study from University of Munich using CytoSorb during cardiac surgery have been published. We are reaching a stage where there are many of these case reports being prepared. There’s quite a number of key leaders planning to either publish or report their positive experience regional, national and international conferences, as well as in other medical centers where we want to introduce CytoSorb therapy. We have a number of ongoing investigated initiative studies for different applications. We hope to see data from two studies in cardiac surgery, one at University of [indiscernible] Medical University of Vienna either the end of this year or first quarter of next year. Recently a major 100 versus 100 patient’s prospective randomized controlled study using CytoSorb intra-operatively during cardiac surgery has been started at the University of Cologne. These are just some examples of studies where data has been generated or is generated and we expect to see much more data in the next six to 12 months. Thank you. Back to you, Amy.

Thanks very much, Christian. Another topic on people minds is the Air Force trauma trial and grant program such as DARPA. Vince, could you please elaborate a little regarding the progress in these programs?

Thank you, Amy. As we discussed in the last investor update, the U.S. Air Force Rhabdomyolysis trials up and running and we are working with the second site to bring that group on as soon as possible. We have been targeting critically injured patients with the very highest levels of myoglobin release from injured muscle. These patients are at the highest risk of developing acute kidney injury. However these high [thresholders] made it difficult to find suitable patients to enroll could meet all the inclusion and exclusion criteria of the trial. As a group we are currently discussing with the U.S. Air Force lowering this threshold to include patients with still very high levels of myoglobin, but at levels that are move commonly seen. We do not think that this will negative impact the study as a primary goal of this study is to reduce high levels of myoglobin. Regarding the DARPA, DOD, SBIR and HemoDefend SBIR we continue to make good progress on these three grants, having received approximately $358,000 in Q2, 24 grant revenue. We recently had an excellent discussion with the new program manager of the DARPA DLT program and are looking forward to finishing our year two effects and begin planning for year three of our five-year contract. During year three, we will begin – we will be taking various new technologies that we’ve developed under the program and beginning pilot scale production to produce enough devices for the DARPA integrator, but tell labs to test in large animal models. We have currently completed the burn injury portion of our U.S. Army Phase II SBIR contract and are working our trauma injury model currently. This is a program that is very exciting because we have been developing quite a number of new technologies. Once this is completed we would discuss with the U.S. Army about potentially advancing to Phase III study. We’re also finishing our very ambitious Phase I HemoDefend SBIR contract with our collaborators at DARPA. We are currently summarizes a data and support for applying a Phase II SBIR contract to further advances application. Consulting new grants we’ve identified a number of additional grant opportunities that we believe are well aligned with CytoSorbents platform technology. These grants range from different type applications to test blood quality, the treatment of inflammatory conditions specifically associated with Biowarfare. As we develop these opportunities we will discuss them in contacts to both financial benefits for company and technology advancement in future updates. Securing non-dilutive funding to advanced development of the CytoSorbents technology platform continues to be one of our key objectives.

Thanks, Vince. Have you started construction on a new manufacturing facility given the uptick in sales?

We began several initiatives since our last update regarding capacity build. First we began certain infrastructure updates to our existing facilities. These infrastructure updates will allow us to further increase our capacity to satisfy our near term needs as we pursue our next objective, a new plan build out. To that end we have begun the process of looking at alternative options including larger facilities to provide both near and long term increase in manufacturing capacity. In addition we began to process of identifying several engineering firms to quote on our plan design. The firms will help us with the facility modifications, equipment installations and startup. The preliminary engineering we completed earlier will facilitate this process and should reduce the total time necessary to bring a new plant online. Outsourcing to manufacturing always remains an option, but for reasons of maintaining control over the know how, controlling production lead times and maximizing gross margins we’ve elected to maintain this in-house.

And what is the current status of the development of HemoDefend product?

Regarding HemoDefend we’ve recently secured additional space for our process and equipment, development engineering. Separating the HemoDefend development process from our manufacturing equipment allows us the ability to continue the process and equipment development testing without disruption to our manufacturing operations. Concurrently we continue to work on the design to establish the best geometry device size for the inline filter application. As we progress down the HemoDefend development pathway, we will provide updates from time to time. As an additional know, based on critical trials like and the Canadian counterpart controlled trials.com it appears that the two large randomized control studies looking at the impact of age, blood and cardiac surgery patients called the RECESS trial and critically ill patients called the ABLE trial have been completed. If not too soon, we may hear about the data or at least topline data at the upcoming AABB or American Association of Blood Banks Conference in late October. If one of these studies demonstrates increased risk with transfusions of older blood, it could significantly elevate the value of approaches like HemoDefend that help purify the blood of degradation products like free hemoglobin that have long been associated with increased risk of older blood.

Thank you, Vince. While we seemed to have covered the major questions, Dr. Chan, do you have any closing remarks?

Thank you, Amy. Thank you everyone for being on the call today. If you have any additional question, feel free to forward them to Ms. Amy Vogel at avogel@cytosorbents.com, and we will try to address them in our next update. Thank you again, and have a great evening.

Thank you. That does conclude our conference for today. I’d like to thank everyone for your participation and have a great day.