Greetings and welcome to the Kamada Limited Third Quarter 2020 Earnings Call. At this time, all participants are in a listen-only mode, a question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder this conference is being recorded. I'd now like to turn the conference over to host Mr. Bob Yedid of LifeSci Advisors. Thank you, you may begin.

Thank you, and good morning. This is Bob Yedid with LifeSci Advisors. Thank you all for participating in today's call. Joining me from Kamada are Amir London, Chief Executive Officer; and Chaime Orlev, Chief Financial Officer. Earlier this morning, Kamada announced financial results for the three and nine months ended September 30, 2020. If you have not received this press release, please go to the Investors page of the company's website. Before we begin, I'd 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 SEC, including, without limitation, the company's Forms 20-F and 6-K, which identifies specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements. Furthermore, the content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, November 11, 2020. Kamada undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call. Sorry for the delay here in getting started. With that said, it is my pleasure to turn the call over to Amir London, CEO. Amir?

Thank you, Bob. My thanks also to our investors and analysts for your interest in Kamada and for participating in today's call, I hope you all are keeping safe and healthy in these challenging times. Let me begin by highlighting our solid overall financial result in the third quarter of 2020. Although the global corona virus crisis continues to affect everyone's life, I am pleased to report that during the third quarter, we were able to successfully maintain our business continuity and we delivered robust financial and operational results as will be detailed by Chaime later in this call. I would like to discuss important progress we continue to achieve around development of our plasma-derived immunoglobulin IgG product as a potential therapy for COVID-19 disease. Most recently, we were pleased to execute an agreement with the Israeli Ministry of Health to supply our plasma-derived IgG product for the treatment of COVID-19 patients in Israel. To our knowledge, this agreement is the first of its kind globally. The initial order plan to be supplied during the beginning of 2021 is sufficient to treat approximately 500 hospitalized patients. This initial supply is expected to generate approximately $3.4 million in revenue for Kamada during the first quarter of 2021. Based on our recent discussion with the Israeli Ministry of Health, the treatment utilizing our products will be provided as part of a multi-center clinical study led by the Ministry of Health, and we plan to use the study results to support further development of the product. We continue to ramp up our COVID-19 IgG manufacturing capacity and expect to be in a position to increase our supply capabilities during 2021 to meet potential additional demand from the Ministry of Health as well as from other potential international markets. As a reminder, during the…

Thank you, Amir and good day everyone. We're pleased with our ability to address COVID-19 pandemic related challenges and meet our expected results during the third quarter and first nine months of 2020. In the third quarter, total revenues were $35.3 million compared to $33.1 million for the third quarter of 2019, representing a 7% increase. These results were driven by a 19% year-over-year increase in sales of our proprietary products, which is attributable to increase in sales of GLASSIA and KEDRAB® to our partners Takeda and Kedrion. For the first nine months of 2020, total revenues were $101.7 million up 7% from the $95.1 million in the similar period of 2019. Based on meeting our expected performance during the first three quarters of the year and our positive outlook for the fourth quarter, we are reiterating our full year 2020 total revenue guidance of $132 million to $137 million. From a profitability standpoint, our total gross profit for the third quarter of 2020 was $14.8 million and gross margins worth 42% up from $12.9 million of total gross profit and 39% margins in the third quarter of 2019. Proprietary gross margins in the third quarter of 2020 were 46%, down 1 percentage point from the third quarter of 2019. Distribution gross margins in the third quarter of 2020 were positively impacted by favorable exchange rates mainly between the U.S. dollars and the Euro. For the first nine months of the year, our total gross profit was $37.4 million and gross margins were 37%. This compared to $37.6 million of total gross profit and 40% margins in the first nine months of 2019. As you recall, we guided the market regarding an expected annual decrease of 3 to 5 percentage points in proprietary product segments gross margins, primarily attributable to…

Thank you. At this time we'll be conducting a question-and-answer session. [Operator Instructions] Our first question comes in line of Raj Denhoy with Jefferies. Please proceed with your question.

Hi, good morning. I wonder, maybe I could ask a little bit about the hyper product, the IgG product. You mentioned the initial sale to the Israeli government the $3.4 million sale for 500 doses and I guess I'm curious the potential for ongoing sales. Have there been any discussions about additional orders from Israel and how do we really think about that on an ongoing basis?

Hi Raj. Good morning, good question. So, as we have announced, this is an initial order that was agreed with the Israeli Ministry, we are ramping up our capacity. We have a conversant plasma supply from Israel and from the U.S. So, we are equipped to continue supplying the product throughout the year based on demand and an increase in the agreement.

Okay. That's helpful and then I just wanted to confirm some of the thoughts around 2021. You've given us some kind of guideposts. So you've talked about $25 million in sales to Takeda and I imagine the rabies product will still be running kind of in that $30 million, $31 million range. Now you have your other products, your distributed products and then this payment from Israel. So is something around $90 million kind of the way to think about where you'll settle out for next year?

So, in addition to what you mentioned, there are additional revenue streams. We sell GLASSIA outside of the U.S. in multiple markets and that business is growing by us either identifying additional patients, applying for reimbursement and submission and registration in addition countries. So this is also a future growth engine for Kamada. We are leveraging the anti-rabies success and we are registering the product in additional markets. We are selling in Canada. We are selling to the WHO. So this is additional market, which we expect to continue growing and we have additional IgG products which are sold outside of the U.S. market. So this is just to complete the full picture of all the different commercial avenues that we have. In regards to a specific projection, a little bit too early right now to give the number. We will give it as we complete our budget planning for 2021. So bear with us a little bit more time and like we've done in previous years, we will give the projection and if you trace back to the last few years, we've always been very accurate in our projection and our commitment.

Great. Thank you.

Thank you. [Operator Instructions] Thank you ladies and gentlemen, this concludes our question-and-answer session. I'll turn the floor back to Mr. London for any final comments.

Thank you. Thank you very much. In summary, we are pleased with how our business performed in the first nine months of 2020. We believe that the fundamental of our business is solid. We have multiple organic commercial growth catalysts, our FDA approved plasma derived technology platform is a strategic asset and our ability to quickly respond to emerging pandemic situation and we have a strong balance sheet, which can be capitalized to fund our business development opportunities. As such, we remain highly confident in Kamada's future prospects. Thank you all for joining us on today's call and we look forward to providing you with further updates on our progress in the coming months. We hope you all stay healthy and safe. Thank you.

Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.