Good morning. My name is Tony, and I will be your conference operator today. At this time, I’d like to welcome everyone to the Celsion’s Second Quarter 2014 Financial Results Conference Call. 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 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 2014 financial results, which we announced this morning. Today’s call will be archived. The replay will be available beginning today at 2:00 P.M. Eastern, and will remain available by phone until Thursday, August 21, 2014. And will also be on Celsion’s website 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 risks and uncertainties including, without limitation, the risk of clinical failures, delays or increased costs, unforeseen changes in the cost of our research and development activities; possible acquisition of other technology 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 now to Michael Tardugno, President and CEO of Celsion. Mike?

Thank you, Jeff. Good morning everyone. We have a lot to discuss today, so I’ll get right to it. Before doing so, I want to remind you, I’m joined today by Jeff Church, from whom you’ve just heard, our CFO and Senior Vice President. Dr. Nick Borys and Anwer, who normally would be with us for this call, are not today. They are attending on a business, but they will be on future calls, I can promise you that. So welcome once again to our quarterly earnings call, and to the new Celsion, the company that all at once, with the acquisition of EGEN, this marvelous science-based company in Huntsville, Alabama, all at once is a fully integrated development company with R&D capability from feasibility through NDA, with platform technologies in chemotherapy, immunotherapy and RNA therapy and clinical trials in Phase III, Phase II and Phase I, in some of cancers globally most important forms, we are extraordinarily well positioned. Celsion now has multiple opportunities to create value for our shareholders, and represents a development company. I’m sure that you will agree by the unique proportion. On the development front, as our recent news fore points up, we’re having an extremely productive year thus far, and one that I suspect will continue to demonstrate significant progress, not only with ThermoDox for primary liver and recurrent chest wall breast cancers, but also with our equally important immunotherapy and RNA platforms. If I can take the liberty now to quote one of our great presidents, “To Those, Whom Much Is Given, Much Is Expected” then I’d add, particularly this morning, with our EGEN acquisition, you should expect much from Celsion. So here is a shortlist. And it reminds the shortlist that what we will be reporting over the next 12 months. From…

Thank you, Mike. Before I review the financial results for the second quarter, I would like to discuss the economics around the EGEN acquisition. The acquisition broadens our technology platforms and product pipeline in two of the most exciting areas of drug development; immunotherapy and RNA therapy. The acquisition will help mitigate the risks associated with the single-product single-technology platform. The negotiated deal terms as Mike stated are user-friendly and represent a deal structure that is one of shared competence and shared risk. The EGEN investors fully share development risk with us. The initial upfront payment consisting of $3 million in cash and $10.6 million in common stock represented 30% of the total considerable for the acquisition, and put no pressure on our balance sheet. We completed the transaction on June 20 and ended the second quarter with over $15 million in cash. Our venture debt lender, Hercules Technology Growth Capital, after completing their due diligence and reviewing the transaction fully endorse the acquisition to a second $5 million drawer of our existing limit facility. This cash infusion more than covers the upfront cash payment and our transaction-related expenses. In addition to the upfront payment, a total of $30.4 million in well-defined value-creating development milestones will triggers set [ph] base earn-out payable to EGEN’s shareholders based upon the completion of important clinical objective in our ovarian and GBM studies for EGEN-001 and joint development and clinical progress with TheraSilence, including partnering and out-license initiatives. 70% of the acquisition price is tied directly to contingent value-creating milestones. If these milestones are achieved, both, Celsion and EGEN shareholders win. This transaction is user-friendly, win-win, risk-mitigating and value-creating. I would now like to turn to the second quarter financial results. Starting with cash, we reported total cash and investments at June 30, 2014…

Well, thank you Jeff. As always, you have the talent to bring these financials to life for us to really enjoy your report. Thank you so much. And particularly your comments regarding the deal terms for the EGEN acquisition, I hope keep on the other end of the line. I appreciate the value of this deal, not only from a technology perspective, but also the economics and the financials. Well, I hope you’ll agree with us. This is an exciting time for Celsion. With our newly expanded pipeline, we have a defined strategy on oncology that is devoted to evaluating innovative therapies and first-line setting. I can’t say enough for that, very important area of research in first-line. It provides us with access to patients, who otherwise would not be interested in joining trials. With active development efforts in primarily liver cancer, ovarian cancer, recurrent chest wall cancer and glioblastoma, we have a broad range of activity in some of the most important cancers in the world. We are advancing our Phase III OPTIMA trial for ThermoDox, targeting registration in the significant markets around the world, and we’re moving with our plans for important clinical trials for EGEN-001 next year. And we’ll be providing data, as I pointed out, and information as I pointed out, early in my comments to support our clinical program for EGEN-001 over the course of the next few quarters. EGEN-001 next year, Phase II in ovarian cancer, Phase I in glioblastoma, and we’re establishing a footprint in the breakout RNAi or siRNA space through the EGEN-002 product and through our TheraSilence program. So, I will conclude my remarks by saying that we have a strong balance sheet, with the funding to advance our key development efforts. We believe that we have the right mix of programs and technology in our pipeline to create value for our shareholders, and most importantly, to make a significant difference in the lives of cancer patients and their family. As always, 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. Now we’ll go to questions operator, so I’d like to ask the audience to limit them to more than two, so that everyone can have an opportunity to get answer. So operator, if you’ll open up the line please?

Thank you. (Operator Instructions) We’ll move first to Keith Markey with Griffin Securities. Please go ahead. Your line is open.

Good morning, Keith.

Good morning. Congratulations on making an excellent acquisition, and good report on the R&D programs. Quick question, could you tell us what the status of patients’ enrollment is or might be in the foreign countries and regions where you’ve gotten regulatory approval for the OPTIMA study?

Good question, Keith. So we do not have a patient yet in the trial. I’m expecting that we will be reporting patient very soon. We have multiple sites that are actively recruiting. There has really been no – we’re right on track with initiating sites in the countries where we have approval and I’m actually very, very encouraged by that. In terms to us, that China will meet their – we’ll meet our timelines in China for achieving a clinical trial agreement or CTA. Typically for most companies, the time period from application to approval is about 12 months. We’re following very closely – and by the way, the progress of any clinical trial application in China is a matter of public record. You could follow it yourself, of course you’d have to be able to read Chinese characters, but you can follow yourself. We do follow it very carefully. So China is accounting for about 30% of our patients in the previous trial, and re-enroll very quickly. So bringing China on board efficiently is important. I want to go a little bit beyond your question, because I think the first patient in only begins the effort. We have met in a couple of medical conferences and will be meeting again at the upcoming ILCA Conference in Kyoto, a number of our investigators. I think they report to everybody on the phone. As I mentioned earlier, the enthusiasm for this trial among our investigator group is remarkable. I think it becomes very clear to the medical community and particularly to our investigators, that appropriately using RFA within its design limitations. I don’t want to say was inappropriately used during the conduct of the trial, but we now know more about the use of RFA in larger tumors than any group of researchers and sponsors. The application of this new knowledge and the well-controlled clinical study is exciting. And I think what we’re going to find is that once the study sites are initiated, that enrollment will progress very nicely, but for the most part, we are on track as I said and as I continue to talk to investors, we believe that from the time the first patient has enrolled to the time they complete 550 patients, the time period of the above goes somewhere between 32 and 34 months. I think we have a good handle on that. With any luck at all, we should be reporting at the first interim analysis some efficacy results, if in fact, the clinical benefit is sufficient to unwind the trial, we will be reporting the results, but we should be able to conduct the first interim analysis in about 36 months following the first enrolled patient. So I know, I answered a lot more than the question that you asked, but thanks for the opportunity to get on my cell box [ph].

Thank you. One question, I’ll throw it, Jeff, financial. Could you give us a sense as to what you expect the burn rate might be in 2015?

Yes, we’ve done a very thorough analysis. Right now, we’re utilizing about $1.5 million per month. We expect that to increase to approximately $2 million a month over the next 18 months. That’s for 2015, about $2 million a month.

Thank you very much.

Keith, may I add to that, so that’s kind of like a straight – that’s like an average. You know that our peaks and valleys [ph] in spending particularly as it relates to making large payments to CROs, but Jeff’s earlier comment, I think is the important one. We do believe that – and we take – and he takes, he is like sliding whiplash when it comes to controlling expenses in the company. We’ll be taking a very sharp pencil and my sense here is that we can talk with confidence about 24 to 27 month runway with the cash that we have, which in the meantime which should allow us to put some very important points on the board.

Thank you very much.

Okay.

Thank you. (Operator Instructions) Meanwhile we’ll move to Reni Benjamin with H.C. Wainwright. Please go ahead. Your line is open.

Hi good morning guys.

Good morning, Ren.

Good morning. Thanks for taking the questions. I guess just a couple. One in regards to GEN-001. Can you give us a little bit more color as to what the translational data maybe? Are we going to be looking at biomarkers or what should we be looking for?

Biomarkers for the most part. Those surrogates that represent the expression of IL-12. The activation of the immune system and all the appropriate components of the immune system, Ren.

Okay.

So yes, let me mark biomarkers. For the most part, the study has been accumulating tissue samples, as well as blood samples. And we think we have patients that’d be able to submit the samples from analysis. And I am hopeful to present that data sooner rather than later given what we know so far in earlier studies, it should suggest that the activation in the immune response in a very profound way, we will see.

And can you just remind us, how big is this study? How many patients have been enrolled and what’s the target enrollment?

Yes. So this has been a dosing escalation study. It combines – again it’s platinum sensitive – I’m sorry, platinum-resistant patients. It’s in combination with Doxil. So it’s been dosing escalation for both, the chemotherapy as well as the EGEN-001. We’ve been through three cohorts. So up to this point, I’ve done only two, but the enrollment maybe very close. We have 9 or 12 patients, but we’re looking for three more to round out the last cohort. So what we haven’t talked about is our interest in – since we have not seen any significant safety issues with the immunotherapy with the IL-12 plasmid, we have been discussing with investigators in the GOG trial, the strategy for an additional dose escalation, at least one additional dose escalation. So there is a chance there that we could be putting as many as six more patients on the study, but that would not stop us from gathering data from the translational analysis that we’re looking for. So above 15 patients on the study, Ren, it could be as many as 21 if we get an agreement to dose escalate the IL-12 plasma.

And this is the only study that’s ongoing right now with the 001, correct?

That’s correct.

Okay. So as my second question, can you talk a talk little bit – it’s just a two part question. One, how many more sweeps of the HEAT study do you think might occur going forward, or we kind of looked at the final data and can you give us I guess your thoughts as to why – how we should be interpreting further data sweeps if that’s going to happen?

Yes, for the overall study, we have reached a million. For the subgroup we have not. We’re very close. We’re within a few patients. This fairly efficient like to point to a stable dataset once you’ve reached the median, you probably know more about that than I do. So we’re close enough I think technically to be able to call in clean success. On the other hand, we have been debating the value of this dataset in support of a registrational program. And it seems – in our most recent discussion, it seems to me one more data sweep will take us to the median for the subgroup that we’re following, the patients treated with radiofrequency ablation, greater than 45 minutes with single lesions, 41% of the study. So we think that this important data could ameliorate any concerns, if there are any. I don’t think there are, but it could ameliorate any concerns for FDA’s need for some confirmation in the OPTIMA study data. So as I say with a little bit of caution, my first reaction to as close as we work to the median was just, this is probably our final study and reflection after talking with our experts and some of the statisticians who have been involved with these kinds of applications, we may choose to continue for one more data sweep, in which case, of course we will publish the results. The results have been – as I said, have been consistent and the magnitude of factors and so strong that [indiscernible] take a major change, you can’t even imagine. Will take some kind of a major change in order to give us anything that would confound what we’ve seen today, Ren. So the strategy here if we continue and the likelihood is 99% yes. If we continue with one more sweep, it would be for regulatory purposes, it would be to support the 33% improvement target, 8% power, 33% improvement target in the OPTIMA study.

Excellent. I have a couple more questions, but I’ll jump back in the queue.

No, go ahead. You can take one more if you would like.

Okay, that would be great. DIGNITY, can you talk a little bit about the durable response rate about how many more patients do you think you need to be recruited to kind of make that go, no-go decision before you go to the FDA to talk about path forward?

Yes, so let me – I maybe speculating with you a little bit [indiscernible] it’s for everybody on the line. So this is an ongoing dialog within the company. So we have recruited 27 now, almost 40 patients among three studies. The protocol in each of the three studies is essentially the same, and a little bit more data that we’re collecting in Phase II study, essentially you can consider it to be for sampling including pharmacokinetics that FDA I believe is interested in. The trial shows some kind of relationship between blood plasma concentration and response. Although in our study, I don’t think they are going to find anything, because it’s just about every patient and every dose treated for an hour with ThermoDox for an hour or so around an hour and a systemic dose of ThermoDox starting at 20 actually, 20 milligrams per meter square, while currently dosing at the MCD [ph] in the study is 40 milligrams per meter squared dosed. Virtually every patient is shown an objective response for the stable disease. And you know this disease progresses. I mean it’s failed and it’s moving, it’s an aggressive recurrence of cancer, so stable disease is an important item [ph]. But every patient, 100% of patients for the most part have shown – I may take that maybe one patient ignore it, but let me just check, but approximately 100% of patients have shown an objective response. Many patients showing a partial response for a remission and I think now with five or six patients among these three studies showing a complete response, pretty remarkable and it’s a gasp from some of our investigators. While we like to complete the enrollment on the study, we think we have 13 kind of which are valuable for efficacy,…

Yes, it did. Thank you very much. And good luck.

Thank you. Next we’ll move to Bob Green [ph], Investor. Please go ahead.

Hi Bob. Good to hear your voice again. Bob Green [ph]: Good morning. I just wanted to confirm something. I thought I heard you say, we haven’t reached a median Overall Survival after the HEAT study?

So let me clarify that. So for the Overall Study we have, for the cohort that we are following to assess a survival benefit, the cohort has the minimum treatment time with radiofrequency ablation of 45 minutes. We are close, but we have not. Bob Green [ph]: Okay. And talking to that same group, those numbers looks so good. Has there been any thought at all of going to the FDA and asking if you could put in NDA for that group?

I am with you. I really am. I think there is a certain discipline and a generally accepted understanding about retrospective studies that – I mean it’s really tested. It’s test of time. Retrospective is now seen more often than not, and I don’t want to discount our result in anyway, are more often not – they are just not reliable. So what we have, Bob, is we have a magnitude effect and the improvement is substantial. It hasn’t wobbled. It’s in controverted mode [ph]. We have marks to high level of confidence. It’s difficult to call it statistical significance, because it’s not prospective, but had it been prospective we would have a p-value that is statistically significant. But the p-value that we calculate for this group is highly confident, we’re highly confident. 96.5% confident that we’re on the right track. I think there may come a time when the FDA will accept to meeting with us to discuss this data, but it’s going to probably will be have to be in context with the OPTIMA study. I don’t believe it’s probably not scientifically or clinically responsible for us to try to conceive over the circumstance where we are the exception to FDA’s rule on considering these kinds of datasets. Bob Green [ph]: Have you looked at applying for the Breakthrough Therapy Designations?

So I think that’s a step that we will take particularly for the current chest wall breast cancer program, but at this point for the HCC study – the advantage at this point clearly is probably lost. We’re already in the Phase III study. If the data is as strong as we think it is, we’ll have – and we do of course have fast track understanding for ThermoDox in HCC. That’s a work in Organ Designations, all of which provides us with significant benefit in dealing with the agency, assuming we have a positive dataset. Bob Green [ph]: Okay. Sir, you answered my questions. Thank you very much.

Thank you for your interest in being a loyal shareholder of the company.

And thank you. At this time, I’ll turn the call back over for closing comments or remarks.

Well, thank you all. I just want to repeat a couple of things that I said earlier in closing. It’s always a pleasure to first [indiscernible]. Particularly now this is an exciting time at Celsion. I hope you agree. With our newly expanded pipeline, we have a defined strategy in oncology and devoted to evaluating these innovative therapies. In cancer some of global – in cancers some of – cancers globally most important forms, primary liver cancer, ovarian cancer, recurrent chest wall breast cancer, glioblastoma could be a priority of the company. We’ll see soon. I conclude by saying that we have a strong balance sheet, as Jeff points out. We are very careful and very mindful of our expenditures. With this balance sheet, we have the funding to advance our key development efforts, and we believe we have the right mix of programs, but more importantly, we have the support of loyal shareholders like you. So it’s our pleasure. We greatly appreciate your interest in the company and we do look forward to updating you on our continued progress. Thank you very much and have a nice day.

Thank you. This does conclude today’s conference. You may disconnect at any time, and have a great day.