Greetings, and welcome to the Longeveron’s Second Quarter 2023 Earnings call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is recorded. It is now my pleasure to introduce host, Mike Moyer, Investor Relations. Thank you, sir. You may begin.

Thank you, operator. Good morning, everyone, and welcome to Longeveron’s Second Quarter 2023 Results Conference Call. We will provide a business update and discuss financial results for the quarter ended June 30, 2023. Earlier this morning, we issued a press release with these results, which can be found under the Investor section of our website. Joining the call today by the following members of Longeveron’s management team. Mr. Wa’el Hashad, Chief Executive Officer; Natalia Agafonova, Chief Medical Officer; and Lisa Locklear, Chief Financial Officer. Mr. Hashad will begin with a brief corporate overview. Then Dr. Natalia Agapitova will review on Longeveron’s recent progress in its clinical programs and Ms. Locklear will review financial results for the 2023 second quarter. Following the company’s prepared remarks, we will open the call to questions from covering analysts. As a reminder, during this call, we will be making forward-looking statements, which are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements. Any such statements should be considered in conjunction with cautionary statements in our press releases and risk factors discussed in our filings with the SEC, including our quarterly report on Form 10-Q and annual report on Form 10-K and cautionary statements made during this call. We assume no obligation to update any of these forward-looking statements or information. Now I’d like to turn the call over to Mr. Wa’el Hashad, Chief Executive Officer of Longeveron. Wa’el? Wa’el Hashad: Thank you, Mike, and good morning, everyone. Welcome to the Longeveron Second Quarter 2023 Business Update and Financial Results Call. We are pleased to be speaking with you today and look forward to sharing our process developing regenerative medicines for unmet medical needs. Our second quarter has been productive in terms of executing on our goals…

Thank you very much, Wa’el. I’m pleased to join the Longeveron team and to provide today’s update on our clinical progress. I will begin with an update on our HLHS program. For those who may not know HLHS is a rare congenital endeavor state birth defect in which the left ventricle of the heart, which either severely underdeveloped omission. The condition affect approximately 1,000 babies per year in the United States. Babies born with this condition have severely diminished systemic blood flow, which requires children to undergo a complex, 3-stage heart construction surgery process over the course of the first 5 years of their lives. While these children now came into adulthood with the surgical intervention, only 50% to 60% of affected individuals survived to other lessons due to right ventricle failure, which is often unable to handle the increased load required to support systemic circulation. Furthermore, even those children with successful surgical intervention are at an elevated risk of short-term mentality, late development and long-term complications, including organ failure, as such, there is an important unmet medical need to improve right ventricular function in these patients to improve both, short-term and long-term patient outcomes. Our ELPIS II trial is designed to assess the potential of Lomecel-B to improve right ventricular function and long-term outcomes. The trial is a 38 patient controlled Phase II clinical trial evaluating the safety and efficacy of Lomecel-B as an adjunct therapeutic to standard of care HLHS surgery. The primary outcome measure is the change in right ventricular ejection fraction from baseline to 12 months. The trial is funded by a grant from a National Institute of Health, National Heart, Lung and Blood Institute. As we announced recently, our ELPIS II trial has exceeded its enrollment threshold of 50%. We also announced the activation of…

Thanks, Natalia, and good morning, everyone. Like Natalia, I’m excited to be a part of Longeveron to speak with all of you today. Most of what I’ll be covering this morning will be presented in more detail, in our condensed financial statements and in our management’s discussion and analysis of operations, In our quarterly report on Form 10-Q, which will be filed today. Revenues for each of the three months ended June 30, 2023 and 2022 were approximately $0.2 million and $0.5 million, respectively. Grant revenue for the three months ended June 30, 2023 and 2022 was $0 and $0.1 million, respectively. The decrease of $0.1 million was primarily due to a reduction in grant funds available due in part to the completion of the grant-funded clinical trials. Clinical trial revenue, which is derived from the Bahamas Registry Trial for the three months ended June 30, 2023 and 2022 was $0.2 million and $0.3 million, respectively. Clinical trial revenue for the three months ended June 30, 2023, was approximately $0.1 million or 36% lower when compared to the same period in 2022 as a result of a decrease in participant demand. Related cost of revenues was approximately $0.1 million and $0.3 million for the three months ended June 30, 2023 and 2022, respectively. The decrease of $0.2 million, or 59%, was primarily related to the decrease in revenues earned from the Bahamas Registry Trial. This resulted in a gross profit of approximately $0.1 million and $0.2 million for the three months ended June 30, 2023 and 2022, respectively. General and administrative expenses for the three months ended June 30, 2023, increased to approximately $3.4 million compared to $2.4 million for the same period in 2022. The increase of approximately $1 million, or 39%, was primarily related to an increase of…

[Operator Instructions] Our first question comes from Michael Okunewitch with Maxim Group. Please proceed with your question.

Hey, guys, thank you for taking my question here. So I guess, first off, I’d like to just get your take on the FDA’s decision for Mesoblast BLA. Obviously, this was a disappointment for the space, but given that you’re both in rare pediatric disease, does this do anything to inform your future development for Lomecel-B in HLHS? And does it give you additional confidence in the design of ELPIS II as a placebo-controlled study? Wa’el Hashad: So Michael, I will take the first step on answering that question. And then I will have Natalia add any additional comments or also I have Josh, who can also add any additional comments. But I would say that from the beginning, we are trying to conduct our HLHS program as a pivotal trial. We are doing everything to make sure that this trial met the FDA requirements and hopefully provide the necessary balance between benefit-risk ratio to accept it for filing. Having said that, there is definitely no guarantee that this is going to happen. As you know, it’s always a matter of review. And the FDA typically weigh in the significant unmet medical need of the disease itself as well as the body of evidence of data, not just in the study that was conducted for that disease, but the overall body of evidence. So while we were really hoping that Mesoblast get their approval on their products, I cannot draw 100% parallel to the HLHS due to: one, we are conducting our trial maybe in a different way. And second, it’s a different disease state. So with that, I will let Natalia and/or Josh to add any further comments to my comments.

Thank you very much. Okay – sorry, Josh.

Yes. I wanted to make a comment and then I’ll turn it over to you, Natalia. Thank you. I think one of the critical aspects that need to be recognized about our ongoing HLHS trial is that it is a controlled trial so that there is an active and best conventional care arm, which is conducted in a rigorous blinded fashion. And I think that’s one of the critical aspects that the FDA has commented on that is crucial for this field. So we are – I do want to emphasize that the ELPIS II trial has that key control group. Thank you. And Natalia, please take it from here.

Thank you so much, Josh. And it’s always good practice to use precedents. And definitely, as Wa’el indicated that’s a completely different indication, but they are learning from communication between FDA and Mesoblast. Thank you.

All right. Thank you very much for the additional clarity. And then I’d just like to see if you have any additional insights here on what kind of a result you would need to demonstrate for ELPIS II to serve as a pivotal study? Wa’el Hashad: So Michael, our primary endpoint is the right ventricular ejection fraction. Again, we believe, as a small as 5% improvement, remember, at the end of the day, it’s all about benefit-risk ratio. So it’s not really one specific measure if we hit the it’s a home run, but I think it’s an overall body. Survival rate could be also an added benefit, which we were encouraged on the results that we have seen from the follow-up on this one. So both the right ventricular ejection fraction and survival rate, in addition, of course, to the safety profile of the product will be important consideration for the agency to weigh in on that indication. But again, I’ll leave it up to Natalia to add any comments.

Thank you, Wa’el, no comments.

Wa’el, may I make a quick comment? Wa’el Hashad: Sure, Josh, go ahead.

Yes. One of the key things to understand about hypoplastic left heart that’s unique from adult forms of heart failure disease is that there’s a very, very clear association between right ventricular function and clinical outcome, been well shown in studies over – going back 25 years now. So the decline in ejection fraction after the Stage II surgery is very closely correlated with a clinical outcome and, therefore, poses a very valuable surrogates. Our trial is designed to look to see whether Lomecel-B increases ejection fraction relative to placebo – and not placebo per se, but that’s conventional therapy, both patient groups or surgery and so we think that the finding could be of great clinical value in interpreting the efficacy of Lomecel-B in this condition.

All right. One more for me, and I’ll hop back into the queue. I’d just like to see it for ELPIS II, if you could remind us of the expected time lines between completion of enrollment and data as we’re approaching that enrollment completion sometime in 2024. Wa’el Hashad: Michael – is that Michael?

Yes. Wa’el Hashad: Yes. Michael, we – as we announced it, we expected to finish the enrollment. We’re targeting hopefully mid next year. Of course, with the thought of a new site there is a lot of plans to try to guide our enrollment in the program. But as you know, with rare diseases it’s hard to predict exactly when. Once we finish the enrollment, it will take 1 year after that to measure the endpoints and then close the trial and provide better results from it. This should happen within couple of months after the trial finish enrollment – 1 year after the trial finish enrollment.

All right. And I’m looking forward to that KOL event. Wa’el Hashad: Thank you.

There are no further questions at this time. I would now like to turn the floor back over to Wa’el for closing comments. Wa’el Hashad: All right. Thank you. All right. Well, thanks, everyone, for attending our today’s call. On behalf of the company and the Longeveron team, I would like to thank you for all your continued interest and support and wish you a good day today. Ladies and gentlemen, thank you so much.

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