Good morning, ladies and gentlemen and welcome to the Protalix BioTherapeutics Fiscal Year 2023 Financial and Business Results Conference Call. As a reminder, this conference call is being recorded. I’ll now turn the conference over to our host, Ms. Lauren Merrick [ph] of LifeSci Advisors, Investor Relations for Protalix. You may now begin.

Thank you, Rob and welcome to the Protalix BioTherapeutics fiscal year 2023 financial results and business update conference call. With me today are Dror Bashan, President and CEO of Protalix; and Eyal Rubin, Senior Vice President and Chief Financial Officer. A press release announcing the results and the update was issued this morning and is available now on the Protalix website. Please take a moment to read the disclaimer about forward-looking statements in the press release. The earnings release and this teleconference include forward-looking statements. These forward-looking statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from the statements made. Factors that could cause actual results to differ are described in the disclaimer and in Protalix’s filings with the U.S. Securities and Exchange Commission. I will now turn the call over to Mr. Dror Bashan. Dror?

Thank you, Lauren and welcome everyone to our fiscal year 2023 financial results and business update call. I will begin by reviewing our accomplishments over the past year and recent progress. Following my remarks, Eyal will provide a more detailed review of our financial results. We will then open the line for questions. 2023 marks a significant year for Protalix as we received regulatory approval for our second drug Elfabrio, for the treatment of adult patients with Fabry disease. In May of 2023, both the FDA and the EMA approved Elfabrio for the treatment of adult patients with Fabry disease. Since then, Elfabrio has been granted additional regulatory approvals in other markets like UK, Sweden and the most recently in Israel as well. Our commercial partner, Chiesi global rare diseases remains focused on the commercial launches, which are underway in the United States, in the European Union, in the UK and additional markets where approvals are granted. We are confident that Chiesi will continue to position Elfabrio for success, and we look forward to continued growth of our Elfabrio franchise. Elfabrio is now the second approved drug expressed via our propriety plant, coal-based protein expression system, Protalix, which further highlights the success of our unique platform with these significant milestones behind us and while we are supporting Chiesi’s operations. We are continuing to focus on building our – the development of our pipeline of innovative assets for the treatment of genetic and non-genetic rare diseases. Our next clinical development candidate is PRX-115, which is being developed for the potential treatment of severe gout. PRX-115 is a recombinant pegylated uricase product candidate that is also produced using our Protalix platform. In March of 2023, we have initiated a Phase 1 first in human clinical trial of PRX-115 to evaluate its safety,…

Thank you, Dror. And thank you everyone for joining todays call. Let me review our fiscal year 2023 financials. We recorded revenues from selling goods of $40.4 million for the year ended December 31, 2023, an increase of $15.1 million or 60% compared to revenues of $25.3 million for the year ended December 31, 2022. The increase resulted primarily from an increase of $14.1 million in sales of Elfabrio drug product to Chiesi following the approval by the FDA and the EMA of Elfabrio as Dror described, an increase of $0.1 million in sales to Pfizer and of $0.9 million in sales to Brazil. We recorded revenues from license and R&D services of $25.1 million for the year ended December 31, 2023, an increase of $2.8 million or 13% compared to revenues of $22.3 million for the year ended December 31, 2022. The increase resulted from the $20 million regulatory milestone payment from Chiesi in connection with the FDA approval of Elfabrio, which was partially offset by a decrease of $17.2 million in revenues recognized in connection with the R&D performance obligation under the Chiesi agreement as the company has completed the Phase 3 clinical program thereunder. Revenues from license and R&D services represent primarily the revenues the company recognized for services provided under the Chiesi agreement. Cost of goods sold was $23 million for the year ended December 31, 2023, an increase of $3.4 million or 17% compared to cost of goods sold of $19.6 million for the year ended December 31, 2022. The increase in cost of goods sold was primarily the result of increase in sales of goods per for Chiesi Brazil and Pfizer. Sales to Chiesi included certain drug substance costs, which had already been recognized as research and development expenses as it was produced as…

Thank you, Eyal. I would like to conclude by expressing how pride we are on of all that Protalix has accomplished throughout 2023. With two drugs expressed via our proven platform are now approved, we are continuing to build our expertise to develop a type of assets to potentially transform the treatment of rare disease. I am grateful for a world-class team who constantly demonstrate unwavering commitment to our mission. We look forward to updating you on our progress as we continue to drive innovation and create long-term value for the patients and stockholders. Now, I would like to ask the operator to open the call for questions.

[Operator Instructions] And our first question comes from the line of John Vandermosten with Zacks. Please proceed with your question.

Great. Thank you and good afternoon Dror and Eyal. If I start off with a question about some of the PRX-102 studies that are going on, I noticed you had one in Japan and one in the United States for pediatric. Can you give us a timeline on how long those might take and what the next steps would be there to get approvals for Japan and for pediatric indication?

So, thank you, John. Actually, this study, this is – and are conducted by Chiesi and this is their responsibility. So, I don’t have the timeline in front of me, of course. And this is for them actually to address that. But you can understand that they put a lot of attention and resources into expanding if I may say the franchise, this is clear.

Yes. Great. It sounds like they have a lot of opportunities out there. And also, you may not have gotten a lot of information from Chiesi on this, but when you look at your revenues and kind of expenditures for the year, how should we think of those balancing out in terms of free cash flow on the bottom line? Are they going to be pretty equal based on the view right now? Is that how you are planning going forward?

Hey. Thanks for the question, John. So, I don’t know what equal means. But as Dror mentioned, gradually, we expect the sales obviously to grow. And in terms of the free cash flow, it depends how much money you are going to invest in the early stage and the later stage R&D. As I mentioned in previous calls, the sales to Chiesi are comprised of an inventory buildup as well as obviously, commercial sales to the enrolled commercial patients. We expect that these sales are going to eventually grow and gradually, we will get to the place, as we indicated in our presentation, that we believe that Chiesi with a good job can they take in the market.

Got it. And then looking at PRX-115, you had mentioned that there is going to be results from that, it seems like in the next couple of weeks. What – assuming those are positive, what are the next steps for that program? Is that Phase 2, or might there be some other pursuit there?

So, if indeed, we continue to go forward, of course, when we move into a Phase 2, yes.

Okay. And would that be before the end of this year that you would start that Phase 2?

This depends – I think it will be between the end to the first half of next year, yes.

The first half of next year, okay. Got it. And then last question on PRX-119. What are the next steps for that? Is that something you might put into the clinic this year?

Not yet. We are looking into the right indication to continue with. I think this will take further a bit more to decide.

Okay. And then any other milestones on the R&D side that we should think about as we progress through 2024?

Once there will be something to update, we will update, of course. We are not exactly sitting on our hands. Well, I think we will pretty much, I would say, even intensively in order to make sure that we can add the additional early-stage assets. It is just – we take our time, and I hope we will cut the right move, but will make sense.

Okay. Alright. Thank you, Dror. Thank you, Eyal for your answers.

You’re welcome.

[Operator Instructions] Thank you. At this time, there are no additional questions. Gentlemen, would you want to make some further remarks.

So, this is to Dror speaking. I just would like to thank everybody again for the time, and again, to thank our shareholders and our employees for supporting us and moving on with our commitment. And we will – of course, we will update you accordingly on any sort of development, and we will meet in the next earnings update. Thank you.

This will conclude today’s conference. You may disconnect your lines at this time. Thank you for your participation and have a wonderful day.

Thank you.