Please standby. Good morning. My name is Emily, and I will be your conference operator today. At this time, I would like to welcome you all to Celsion Second Quarter 2017 Earnings Conference Call. All lines have now been placed on mute to prevent any background noise. Following the speakers’ remarks there will be a question-and-answer session. [Operator Instructions] At this time, I’d like to turn the call over to Mr. Jeffrey Church, Celsion's Senior Vice President and Chief Financial Officer. Please proceed, Mr. Church.

Thank you. Good morning, everyone. And welcome to our second quarter 2017 investor conference call, which we announced this morning before the market opened. With me on our call today, Michael Tardugno will provide an operational update on our clinical programs and I will summarize our financial results for the second quarter and first six months of 2017. Today’s call will be archived and a replay will be available beginning tomorrow and will remain available by phone until August 29, 2017, as well as available on Celsion's website for 90 days. Before we begin the call, we wish to inform participants that we will be making forward-looking statements regarding Celsion’s current expectations and projections about future events. Generally forward-looking statements can be identified by terminology such as may, should, expects, anticipate, intends, plan, believe, estimate or similar expression. These statements are based upon current beliefs, expectation and assumptions, and are subject to a number of risk and uncertainties, including those set forth in the company’s periodic reports files with the Securities and Exchange Commission, many of which are difficult to predict. No forward-looking statements can be guaranteed and actual results may differ material from such statements. The information on this call is provided only as of the date of this call and Celsion undertakes no obligation to update any forward-looking statements contained in this conference call, based upon new information, future events or otherwise, except as required by law. At the conclusion of today's formal remarks, we will open the call for questions. I’d now like to turn the call over to Mr. Michael Tardugno, Celsion's Chairman, President and CEO. Mike?

Thank you, Jeff. Good morning, everyone, and thanks for joining us for today’s call. With me are Dr. Nicholas Borys, Celsion's Chief Medical Officer; and Jeffrey Church, of course, from whom you just heard, our Chief Financial Officer. As always, we are delighted to have the opportunity to update you on our progress and answer your question. And for those of you know me you can probably tell from my voice, I am fighting a cold, so please bear with me, we have got a lot to talk about and I'll try to keep the volume up. I’d like to start by saying once again that our fundamentals are sound, our progress is significant, and our excitement is palpable as the achievement of several important milestones we reported during the second quarter, milestones that continue to drive momentum both in and outside of the clinic. Our corporate goals remain unchanged and that is to develop novel, innovative, simple therapeutic solutions to address complex unmet medical needs, all the while pursuing long-term value for our shareholders. We do so with a great deal of focus on two primary clinical programs. The first is, the Phase III OPTIMA study. We’re working to rapidly advance the evaluation of our heat sensitive liposomal formulation of doxorubicin, that’s ThermoDox, for the treatment of newly diagnosed primary liver cancer patients. With over 850,000 incidents, primary liver cancer or HCC or hepatocellular carcinoma as its known, as you know, is the world's largest unmet medical need remaining in oncology. Our second and equally important work is in ovarian cancer. Leveraging our clinical development expertise, we've expanded our product pipeline to include the emerging science of immunotherapy. Our novel IL-12, that’s interleukin-12 gene mediated product candidate GEN-1 is now being evaluated exclusively in the OVATION study of newly…

Thank you, Mike. During the second quarter we continued to efficiently utilize our cash as we effectively execute our clinical development initiatives. We ended the second quarter with $3.6 million of total cash and investment that included the exercise of outstanding warrants during the second quarter totaling over $5 million. Subsequent to the end of the quarter, this was in early July we announced the completion of the $5 million registered direct equity offering with several institutional investors. This capital infusion should cover operating needs for the balance of 2017 at which time we will be less than six months from completing patient enrollment in our pivotal Phase III study in primary liver cancer and about four quarters from the first planned interim efficacy analysis. This significant very inflection for the company is now coming into view. Celsion's 2017 second quarter financials were included in the press release, which we issued before the market opened this morning. Our Form 10-Q for the quarter ended June 30, 2017 was filed on Monday, August 14th, after the market close. We continue to monitor our cash expenditures to ensure the most efficient use of cash to create shareholder value. Our clinical development focus is squarely on the enrollment of our pivotal Phase III trial for ThermoDox in primary liver cancer and the earlier phase studies for GEN-1 in ovarian cancer. Operating expenses were $9.6 million in the first half of 2017, compared to $10.2 million in the same period of 2016. Cash used for operation in the second quarter ended June 30, 2017 was $4.2 million, compared to $4.3 million in the prior year. Cash used for operations in the six months ended June 30, 2017 was $7.3 million and that compared to $9 million in the prior year. These results are in…

Sorry, I was -- we were on mute.

Thank you.

Yeah.

Okay. Thanks.

Okay. So I'll just repeat, just the concluding remarks. Phase III OPTIMA study is on track. OVATION is complete and showing exciting potential for GEN-1. As Jeff points out, our cost structure well-managed and the NVA, I would say, the NVA of our industry, we are looking forward now to continue our work. So, with that, I'd like to open the lines for questions. Operator, if you would and I would ask those on the line if you limit your questions to no more than two, so that we can provide everyone an opportunity to participate in the Q&A. Operator?

Thank you. [Operator Instructions] And we will go first to Hartaj Singh with Oppenheimer. Please go ahead.

Good morning, Hartaj.

Hi. Good morning. This is Emma [ph] on for Hartaj, actually.

Hi, Emma.

With regard to GEN-1, I think, in the past there was some interest in evaluating its potential in a post surgery setting to delay or prevent the tumor recurrence occurrence . Could you just give us any update or color on the latest thinking there and how that might fit into the clinical development plan?

I am sorry. I just missed the first part of your question, could you just repeat that, please?

Sure. So on GEN-1, you had mentioned in the past that there was interest in evaluating a potential in a post surgery setting to delay or prevent tumor recurrence, could you just update on the color or latest thinking there on how that might fit into the clinical development plan?

I see. So as a maintenance therapy, I mean, following surgery continually to treat patients. Yes, Nick, do you want to?

Well, as you know, there’s plenty of roles for immuno-therapeutic therapies and we are looking for the ideal fit for GEN-1, so in this last set of clinical studies that we've done, we are now looking at -- in this new adjuvant setting where we have the tumor at the time of enrollment of the patient, we get the biopsy of the tumor, and then we get follow-up on the patients once the tumor has been removed in that interim surgical setting. So I think at the end of this, we are going to have a pretty good idea where it is going to be the strong points for GEN-1, and the effect it directly has on the tumor. So, I think, again the message here is watch the space and I think there might be an interesting world there.

Yeah. I think, if I just could add something, in reading in the recent JCL, some -- an article regarding some of the stem cells like the pre-cancer, like cancer related stem cells that go untreated like chemotherapy and they seem to find a way to continue to evade the immune system from the source of metastasis. There is some suggestion here that immunotherapy and maybe GEN-1, maybe one of those therapeutics that has the potential to address those cancer-related stem cells that go untreated when the primary disease is then addressed. So that will be a part of our discussion with the Scientific Advisory Committee in September.

Okay. Great. Thanks, Nick and Mike.

Thank you.

[Operator Instructions] And we will go next to Jason McCarthy from Maxim Group. Please go ahead.

Hi, guys. Thanks for taking the question. Two questions, one, first off, Mike, you are saying, you are about 60% enrolled of the 550 patients now and you are on target for second quarter ‘18 to complete enrollment, could you just review with me the timing for completion of enrollment and after that when would you expect the first interim look at the data?

Yeah. Good question. Thank you. So over 60% enrollment, 60% of 550, you could do with your counsel as 530 patients, more than 530 patients quite a few more actually. Our enrollment rate target has been exceeded actually in the last three months. We have been planning about 18 patients a month to over 20 patients a month, and you can kind of do the math yourselves. If that continues, Jason, we should be in the middle of the second quarter next year completing enrollment on the study and it could even get better. Nick Borys has been very anxious. Dr. Borys has been very anxious to initiate few more new sites, we have commissioned our CRO in Vietnam to add two more sites and we are working with the Chinese CRO, who is attached to our global CRO to add five more sites in China. So there is every reason for us to believe that the enrollment rate can pick up. So we are actually quite pleased with where we are at, after actually experiencing an over one year delay in getting study approval in China, of course, we weren’t the only one, the entire world waited for China to reorganize the CFDA to accept new protocol applications. So the death rate is really what -- and that's a horrible way to think about it, I guess, but the event rate is key to the first interim data look, first interim look will be at 118 events, Jason. We are looking for about a -- hazard ratio of about 0.62, I believe, p equal to 0.052 to unblind the study. The data that supports that, of course, comes from the HEAT study in this very similar population, not as well-controlled as we're controlling in, I would say, in the OPTIMA study or the -- this patient population treated with more than 45 minutes saw hazard ratio of 0.65 p equal to 0.02. There is an all time chance here that at 118 events, we would be quoting success. If not, we have -- as you know we have a second interim analysis followed by the final analysis. So the question was when will we get that first look. Obviously, the DMC meeting was just recently completed. We know the number of events, I am not going to share them in this call, the numbers of events are valuated based on the enrollment rate, our statistician gives us the prediction of when that 118 number will be hit in. So our thinking here, our best thinking here is about two quarters following full enrollment of the study, that could change, but we will give you an update in the next quarter based on, we will have actually, I think, a former handle on the number of events in the next quarter, so that's our best thinking at this point, Jason.

Okay. Great. Thank you. And just the split between China and the rest of the site, how many patients were Chinese based patients, the need for China FDA to allow you to file there?

Yeah. So the official line on that is 200 patients, 100 pairs of Chinese patients. And we are recruiting patients in Hong Kong, Mainland China and in Taiwan. Although, Taiwan has been the subject of some political discussion, apparently Taiwanese Chinese are not China -- Chinese in some halls of the CFDA. That being said, we had a very productive conversation with the Deputy Director of CDE of the CFDA interoffice, Dr. Borys and I. Nick gave an overview of the study. We were trying to achieve in those and actually focused on the China population -- Chinese population from the HEAT study and their comments to us were I think very not only surprising, very supportive. She indicated that our -- since this is such a health emergency in China that we will not have to wait for a, if the study successful, if we hit our endpoints, we will not have to wait for the CPP from either the U.S. or Europe, which is typically required before filing an NDA we could file immediately, that was I think a blockbuster comment from here. She also indicated that the 200-patient requirement was under review and so we'll no more, I think, here in the next month or so. We intent to, Nick and I, along with some others will be in China in September to meet with our investigators as we do annually and we want to take some time to try to sort this out a little bit more. But 200 patients is the official line we understand that’s evolving and it may -- we may be allowed to include Chinese patients in from other countries like Taiwan, certainly from Hong Kong.

Okay. Great. Thank you, Mike, for taking the questions.

Thank you.

And we will go next to Keith Markey from Griffin Securities. Please go ahead.

Good morning.

Hi, Keith.

Hi.

Okay.

Two questions.

Sure.

One, I was wondering, if you have -- if any of the GEN-1 patients that had R0 resection had progressed with their disease or are those patients still disease stable, I guess, are free?

The answer is…

As far as we know all the R0 patients are still have no evidence of disease. So we’re following them very carefully on that.

Keith and progression in this population is really interesting. When we discussed PFS with our study investigators, they suggest to us that we should expect the normal distribution like a [inaudible] (41:27) and that would mean, for example, some patients will progressive after two months, some patients will progress after six months, some patients nine months, some patients 12 months, 15 months, 18 months, 20 months, then you get the median is 12. In our -- we have not seen any progressions at the -- at any early March. The only progression we have is that just about 12 months and rest of the patients not treated over 12 months, as I pointed out. This whole thing is skewing to a positive PFS result. Now that -- certainly that could change and I don't want to get ahead of myself here. But and if it does, of course, we will be a very fairly open about it. But PFS leading indicator of overall survival is very encouraging at this point.

Okay. Good. Thank you. And then, I was wondering, if there might be any news from the NIH about the HIFU study they're doing?

Will end at the Children's Hospital.

Yes.

Yes. Yeah. I think, I reported on that one and this has just been a pep project for Dr. Borys. We have been very excited about it and for frankly, I -- it’s unfortunate that I have to report to you that we have -- we are not aware of any patients we have enrolled in this study.

Okay. Thank you.

Thank you.

[Operator Instructions]

Okay. Well, I want to thank everybody for your time this morning. I apologize again for the quality of my voice, hopefully in get over this cold pretty quickly. And just again to conclude, we remain excited, not remain, we are very excited about the potential for both these programs in chemotherapy, this legacy of oncology with our innovative product ThermoDox. Finally, are excited -- we are excited about the NIH our investigator, so world is looking for to the results of this ThermoDox study in primary liver cancer. And in immunotherapy, where we are seeing some early and trends, we do not overstated, but early -- nonetheless, remarkable clinical findings so far in our Phase I program moving quickly to Phase II once our Scientific Advisory and Medical Advisory group meeting in September. And all of that, we value your continued support and we thank you very much for joining us on the call. Our promise to you is that we will keep you updated and I'll promise also is to continue to work to deliver innovative oncology therapeutics to address some of the most important prevalent cancers at the highest unmet need. Thank you again for joining us on today's call. And with that, adjourn the telephone call. Thank you.

Ladies and gentlemen, that does conclude our conference for today. Thank you so much for your participating. You may now disconnect.