Greeting and welcome to the Pulse Biosciences' Third Quarter 2020 Earnings Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the conference over to your host, Philip Taylor, Investor Relations. Thank you. You may begin.

Thank you, operator. Before we begin, I'd like to inform you that comments and responses to your questions during today's call reflect management's views as of today, November 9, 2020 only and will include forward looking statements and opinions statements. These include statements regarding our plans and expectations relating to regulatory clearance, including the process timelines and expected outcomes, for commercial, operational, scientific, clinical and financial projection, products including the uses, benefits and applications of such products, and our commercial and regulatory strategies, the impact of the COVID-19 pandemic and other future events. Actual results may differ materially from those expressed or implied as a result of certain risks and uncertainties. These risks and uncertainties are described in detail in our most recent Form 10-Q filed with the Securities and Exchange Commission on August 10, 2020. Our SEC filings can be found on our website or at the SEC's website. Investors are cautioned not to place undue reliance on forward-looking statements. Please note, that this conference call will be available for audio replay on our website at pulsebiosciences.com on the News and Events section of our Investor Relations page. With that, I would now like to turn the call over to President and Chief Executive Officer, Darrin Uecker.

Thank you all for joining us this afternoon for a third quarter of 2020 earnings conference call. Across the world and in our organization, we all continue to adjust to the challenges presented by COVID-19. That said we have not adjusted the mission of Pulse Biosciences, which remains to offer bioelectric medical solutions that make meaningful differences for the betterment of patients and clinicians. Throughout these difficult times, our team has shown unwavering dedication in their efforts to bring our technology to the market. We are excited to announce the 510-k application for the CellFX System has been submitted to the US Food and Drug Administration. This accomplishment and additional developments have positioned Pulse Biosciences to potentially receive regulatory clearance for the CellFX System in three strategic geographies as early as the end of the first quarter of 2021. On the call today, I will discuss the substantial clinical and regulatory progress and provide details on our commercial preparations and strategy. Ed will detail the plan controlled launch and summarize recent engagements with scientific community. Sandy will discuss the third quarter financial results. Then I will conclude and we will open up the call for Q&A. There are two main business objectives we are focused on to position Pulse Biosciences for long term success. The first is achieving regulatory clearance for our CellFX System in the US, the European Union and Canada. The second is preparing for the commercial launch of the CellFX System. In recent months progress towards these objectives has been significant. Before providing details on the recent progress, I will take a moment to explain what our technology does, its benefits, how it is administered to patients and why the system we have designed is ideally suited for the dermatology market. CellFX System is a multi application…

Thanks, Darrin. I will be discussing overall commercial readiness and market priming for the first launch of the CellFX System in aesthetic dermatology. I'll begin by providing more details on the strategic approach to our global commercial launch, which focuses on the important role of worldwide key opinion leaders in aesthetic medicine, and includes continued marketing research insights from our target systemic procedure market. Finally, I will highlight the continuing scientific publications of NPS clinical evidence presented to the professional dermatology community that features our unique non thermal mechanism, and how that cell specific mechanism addresses common problems in dermatology that are difficult to treat with older thermal technologies. First, I want to summarize our launch readiness and how our commercial teams focused, strategic approach to launch with key opinion leaders or KOLs will lead to a long term and sustainable commercial success. This top down strategy begins with the impressive clinical evidence and mechanism of action research that has been conducted with some of the most respected scientists and institutions in the world of aesthetic dermatology and energy based devices. The impressive CellFX body of evidence backed by associated centers of opinion leader advocacy will be highly leveraged in our next phase of KOL foundation building that follows our anticipated regulatory clearance that Darrin just talked about. This foundation building, which we have described to you as a controlled launch of the CellFX System is focused on select aesthetic device opinion leaders in North America and Europe. During the last several months, our commercial team has selected 45 centers in North America, and 11 centers in the European Union to be the first physicians to launch the CellFX System. And the associated CellFX commercial procedures into the respective markets and geographies. This will take place soon after commercial clearance.…

Thank you, Ed. For the third quarter of 2020, operating expenses were $12.9 million compared to $12 million for the prior-year period. Increases in research and development costs and, to a lesser extent, increases in general and administrative costs drove the increase in operating costs. Operating expenses for the three months ended September 30, 2020 included $2.6 million of non-cash stock-based compensation, versus $2.7 million in the prior-year period. General and administrative expenses consist of salaries and related employee expenses for executives, sales and marketing, finance, legal, human resources, information technology and administrative personnel, as well as professional fees, patent fees and costs, insurance costs and other general corporate expenses. General and administrative expenses increased by approximately $165,000 to $5.8 million for the three-month period ended September 30, 2020 from $5.6 million during the same period in 2019, primarily related to increases in personnel, business insurance and facility expansion costs, offset by a reduction in recruitment-related costs from a year ago, as well as the reduction in travel expenses, primarily related to COVID-19. Research and development expenses consist of salaries and related expenses for manufacturing and research and development personnel, as well as clinical trials and consulting costs related to the design, development and enhancement of our potential future products. Research and development expenses increased by approximately $800,000 to $7 million for the three-month period ended September 30, 2020 from $6.2 million during the same period in 2019, primarily due to increases in personnel and an increase in consulting and outside services related to our GLP preclinical studies in support of our 510-k submission, offset by a reduction in clinical trial expenses from a year ago. Net loss for the first quarter ended September 30, 2020 was $12.9 million compared to $11.7 million for the third quarter ended September 30th, 2019. Cash and cash equivalents and investments totaled $29.6 million as of September 30th, 2020, compared to $37.8 million as of June 30th, 2020. Cash utilized in the three months ended September 30th, 2020 was $8.2 million. This compares with $7.9 million of cash utilized in the three months ended June 30th, 2020, excluding net proceeds received in the rights offering. Now I will turn the call back to Darrin.

Thank you, Sandy. To conclude, we have maintained a focus on our core objectives throughout these challenging times and taking huge strides toward bringing Nano-Pulse Stimulation technology delivered by the CellFX System to clinicians and patients. Regulatory submissions to achieve FDA clearance, CE Mark approval and a Health Canada Medical Device License could potentially all occur as early as the first quarter of 2021. We completed enrollment of 60 patients in our first FDA IDE-approved pivotal study comparing to CellFX System to electrodessication in just over five weeks and ahead of schedule. Our continued engagement with the scientific community and a strategic commercial launch plan position Pulse Biosciences for success. We are very excited about this pivotal time in the Company's history and the momentum we are building toward commercial launch of the CellFX System. We look forward to providing you updates in the future. Joining me now for Q&A are Ed Ebbers, Executive Vice President and General Manager, Dermatology; and Sandy Gardiner, Executive Vice President and Chief Financial Officer. Operator, please open the call for question.

[Operator Instructions] Our first question comes from Sean Kang with H.C. Wainwright.

Hi. Thank you for taking my question. So I have a question about the regulatory pathway strategy in ex-U.S. divisions, basically Canada and EU. So would you take a similar approach or like step wise regulatory strategy in both region as well?

Yes. Hi, Sean. It's Darren. Thanks for the question. So, if I understood your question right, your question is about the regulatory strategy in Canada and EU?

Yes. So basically you're going for general indications first and then add specific indication later as soon as to what you're doing in the U.S.

Yes. Sure. I understand. Yes, I understand your question. Thank you. So as I mentioned in the prepared remarks, with regard to the CE Mark in the EU, part of our technical file, we included clinical evaluation report. The clinical evaluation report included clinical data in support of sebaceous hyperplasia, seborrheic keratosis and warts. And so, it's actually well beyond the sort of general indication that is more of a -- sort of a general indication plus indications including those three lesions that I just mentioned sebaceous, seborrheic keratosis and warts. So like I said, we're very hopeful that we're getting down to kind of the final Q&A on our CE Mark with our notified body. And when that comes in, we have confidence that at that time we will be able to ship and commercialize in the EU. and promote the CellFX System for those specific indications. So unlike the U.S., I think we're in a position to be able to market to those indications immediately as we receive the CE Mark. As it relates to Health Canada and the Medical Device License in Canada, our submission also included those three indications. So it's a bit early in that process to be able to comment at all on what might come out of that approval through Health Canada, but certainly our submission included those three indications.

I see. Just a quick follow-up question to that is, would do seek commercial partners in Canada and EU or would you just directly market that your product over there?

Yes. This is Ed answering that question. I would describe our models as a hybrid direct and distributor model, and it varies by market in country. In the instance of Canada, we will be hiring our own direct sales force to cover Canada and expand as the installed base justifies that expansion with direct employees. In the instance of the EU, we are in the process of recruiting and hiring EU-based sales and operations team to directly launch in the largest and most influential markets and specifically, to provide the level of support for the controlled launch for EU opinion leaders that match our higher standards. And then we will be looking at for other smaller markets, closely managing distributors in those countries where it makes sense again with our own people directly involved with distributors to make sure the standards of training and education meet that of our direct sales team. So that's our distribution plan going forward.

There are no further questions at this time. At this point, I'd like to turn the call back over to Darrin Uecker for closing comments.

All right. Thank you, operator, and thank you everybody for joining us on the call today. And at last, thank you for the Pulse Biosciences team and all of our partners who have really helped us make tremendous progress over the last several quarters during these challenging times. Thank you very much. We look forward to updating you very soon.

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