Good day, and welcome to the Kamada First Quarter 2017 Earnings Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Bob Yedid with LifeSci Advisors. Please go ahead, sir.

Thank you and good morning. This is Bob Yedid with LifeSci Advisors. Thank you for participating in today’s call. Joining me today from Kamada are Amir London, Chief Executive Officer; and Gil Efron, Deputy Chief Executive Officer and Chief Financial Officer. Earlier this morning, Kamada announced financial results for the first quarter of 2017. If you have not received this news release or if you would like to be added into the Company’s distribution list, please call me at LifeSci at 646-597-6989 or email me at bob@lifesciadvisors.com. Before we begin, I would like to caution that comments made during this conference call by management will contain forward-looking statements that involve risks and uncertainties regarding the operations and future results of Kamada. I encourage you to review the Company’s filings with the Securities and Exchange Commission including without limitation the Company’s Form 20-F and Form 6-K which identify specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements. Furthermore, the content of the conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, May 16, 2017. Kamada undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call. With those remarks completed, I'd like to now turn over the call to Amir London, CEO. Amir?

Thank you, Bob, my thanks also to our listeners for your interest in Kamada and for participating in today’s call. Let me begin by addressing our first quarter revenues which were below our expectations. Total revenues were $11.6 million, and revenues from the proprietary products were only $6.6 million. Our revenues were impacted by a delay in completing a periodic validation of our filling line which resulted in delay of shipping proprietary products batch. Subsequent to the end of the third quarter, the validation was successfully completed and the delayed shipment will be made. As a result, all delayed revenues from our proprietary products segment was approximately $11.5 in revenue will be shifted from the first quarter and recorded in the second quarter of this year. Consequently, we remain highly confident in our ability to attain our previously stated objective or reaching $100 million in total revenues in 2017 out of which $76 million to $78 million will come from our proprietary products segment, representing at least 36% growth year-over-year compared to 2016. We also expect to generate positive cash flow this year. This significant growth in proprietary product sales is mainly the result of our increasing market shift to GLASSIA in the U.S. for the treatment Alpha-1 Antitrypsin Deficiency sold by Shire as a part of a strategic agreement between our companies. Although the first quarter results are below our expectations, it is important to note that our total revenue for the quarter including the delayed shipment represent a revenue rate supporting our total annual guidance of $100 million. Gil will provide detailed revenue of our first quarter financial results shortly. So let me now read to you our clinical and operational highlights since our last call in early February. We were pleased to host an R&D Day in…

Thank you, Amir, and good day, everyone. Amir previously discussed the shipping delay we experienced in the first quarter, but let me reiterate our confidence in our ability to capture all of the delayed revenue from the first quarter in the second quarter of 2017. We expect to generate $76 million to $78 million of revenues from our proprietary product segment and $22 million to $24 million of revenue from our distribution segments with the total of $100 million from both segments in 2017. With that let me begin my review of the first quarter financials. Total revenues for the first quarter of 2017 were $11.6 million a decrease of 21% from the $14.8 million for the first quarter of 2016. Revenues from the proprietary products segments were $6.6 million in the first quarter of 2017 a 40% decrease compared to the 2016 first quarter. For the first quarter of 2017 distributed product revenue was $5 million compared with $3.7 million in the second quarter of 2016 an increase of 36%. The increase was due to higher demand for different products. Gross profit for the first quarter of 2017 was $2.3 million a decrease of 52% compared with $4.8 million for the first quarter of 2016. Gross margin decreased to 20% from 32% in the first quarter of 2016. The decreasing profitability was due to the decrease in revenues in the proprietary products segment and the mix of sales of proprietary versus distributed products. Gross margin from our proprietary products segment was 22% compared to 38% in the last year quarter due to the delay in the $11.5 million of revenue mentioned by Amir and we expect it to return to the same levels as last year once shipments are made. Looking now to the rest of the P&L, R&D.…

Thank you. [Operator Instructions] And we'll take our first question from Anthony Petrone with Jefferies.

Thank you and good evening and good morning. Maybe to start out with the GLASSIA shipment delay into the second quarter, I mean how often do the periodic validation processes take place, and can you give us an update on where GLASSIA is in terms of share within Shire? And then I have a few follow-ups, thanks.

Okay, thank you very much for the question. So to answer your first question, the validation is a routine procedure which we do on our different filling lines on a routine basis a few times a month. In this case, one of those routine validation runs took longer. We had to repeat this, it was delayed, and therefore we had to wait with the product shipments until we successfully completed that validation run, and only then the product is being shipped to the U.S. as we mentioned. Important to note that during the quarter like I mention in my report, we successfully passed FDA and the EMA GMP inspections. We strictly comply with the GMP requirements and we of course continue, plan on continuing to meet all those regulations. In terms of market shares, we don’t report specific market shares under our agreement with Shire. What I can say is that in 2016 GLASSIA sales continued to grow 25% compared to last year, so is the previous year. If you look at our forecast of this year for comparative product sales, we expect a 36% growth. A majority of this comes from GLASSIA in the U.S. through the collaboration with Shire. This is our main growth engine. You can, based on that, you can definitely estimate, you know, our GLASSIA share in the U.S. AAT markets.

Okay and then maybe a couple on the catalysts into the second half. I'm just wondering in terms of inhalable GLASSIA in terms of the EMA decision and the finalizing of the regulatory pathway with FDA. I mean, do you expect the EMA decision to come ahead of finalizing that pathway with the FDA? And then in other words will the EMA decision sort of influence how the final structure of the FDA study looks like for inhalable? And then I have one additional follow up. Thank you.

Thank you for the question Anthony. We don't see those decisions as they are dependent on each other, so that should happen in parallel and we expect the end decision, as we have said in the past in the second half of 2017.

Okay and then last for me is on anti-rabies in the U.S. I'm just wondering the launch timing of that product assuming that we get a positive recommendation at the upcoming PDUFA date? Thanks again.

Thank you. So yes, so the PDUFA date is end of August, assuming of course a positive decision and we plan on launching the product right after that, hopefully towards, before the end of the year, but important to note that in the $100 million focus for the year, we did not include the anti-rabies for the U.S. So we kept it kind of as an upside. This might already happen this year and definitely will have a significant impact on our sales starting next year. So we hope to launch it before the end of the year, but it's not part of the focus for the year.

Thank you very much.

Thank you. [Operator Instructions] We’ll take our next question from Elemer Piros with Cantor.

Yes, good evening gentlemen. What I'd like to ask is, Gil, maybe if you could help us quantify the impact of the delay in the cost of revenues? So I presume that in this $5.2 million that you recognized, a good portion of it was related to the delayed shipment, is there any further cost to be recognized once for it when the shipment is made?

Yes, so I remind that as Amir mentioned, the revenues that were delayed were about $11.5 million. The cost associated with that is the cost of goods to be shipped, and then as I mentioned, once we shipped those products we should expect to be in the gross profit margins as we were in the previous year.

Okay thank you.

Yes, I wanted to add one thing just to emphasize that we did recall revenue of $11.6 million for the quarter, if you add the delayed shipment of $11.5 we are at approximately $23 million sales for the quarter, which supports our $100 million for the year.

Understand, thank you very much for that clarification Amir. And maybe a question to you, the GvHD study seems to be one of the largest out there and the endpoints that you're investigating are fairly conventional. Do you believe that there may be a way to convince Europeans to be able to use this study design to satisfy their regulatory requirements?

So we’ve met the Europeans, we had scientific advice meeting. We got the feedback from that Advisory Board and we need to do some modification for the protocol for the decision to go with an independent study in Europe, not only related to the requirements from the regulators, it's also a business decision in the U.S. the right for the product, our positive agreement with Shire, while in Europe we are moving forward independently and we decided to do a separate independent study also because of that strategy.

I see and would you be able to provide an estimate for the cost of the two trials Amir? Thank you.

Being orphan indications and very similar experience with other indications of the same size or similar size and there from the data that we've collected so far we believe that a $20 million to $30 million investment, so between $20 million to $30 million investment to do that Phase 2/3 study.

And that would be partially underwritten by Shire, correct?

In Europe we are working independently. Shire has no right for the European territory. So, the investment is Kamada's investment while in the U.S. or the U.S. program is co-funded and co-developed by Shire and Kamada as part of our agreement.

Thank you very much for clarifying.

Thank you. [Operator Instructions] And that concludes today's question-and-answer session. Mr. Amir London, at this time I will turn the conference back to you for any additional or closing remarks.

Thank you. In closing, Kamada remains in solid operating position. Based on our financial outlook we expect 2017 represents a strong growth versus 2016 and our pipeline continues to advance as expected. We look forward to the remainder of 2017 and the multiple value creating milestones we are anticipating. Kamada remains committed to growing our business and enhancing long term shareholder value. Thank you very much for joining us on today’s call and we look forward to providing you with further updates on our progress throughout the remainder of the year. Thank you and enjoy the rest of your day.

And that concludes today’s call. Thank you for your participation. You may now disconnect.