Good afternoon, ladies and gentlemen. Welcome to Cytori Therapeutics’ Third Quarter 2016 Earnings Results Call. At this time, all participants have been placed in a listen-only mode and the floor will be open for your questions following the presentation. [Operator Instructions]. Before we begin, we want to advise you that over the course of the call and question-and-answer session, forward-looking statements will be made regarding events, trends, business prospects and financial performance, which may affect Cytori’s future operating results and financial position. All such statements are subject to risks and uncertainties, including the risks and uncertainties described under the Risk Factors section, included in Cytori’s Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission from time-to-time. Cytori advises you to review these risk factors in considering such statements. Cytori assumes no responsibility to update or revise any forward-looking statements to reflect events, trends or circumstances after the date they are made. It is now my pleasure to turn the floor over to, Dr. Marc Hedrick, Cytori’s President and Chief Executive Officer. Sir, you may begin.

Good afternoon, everyone, thank you and thank you, Kristen. Welcome all to our third quarter 2016 earnings call. As Kristen said, I am Marc Hedrick, President and CEO of Cytori. And joining me on the call today is as usual our CFO, Tiago Girão; our Chief Medical Officer, Dr. Mark Marino both of them are in the U.S. and then here in Japan with myself is our Vice President and General Manager of Cell Therapy, Mr. John Harris. So let me just give you a brief overview of the call today. So first, I'm going to discuss the progress in our pipeline including some key updates on our clinical programs. John will then discuss the commercial related activities and related plans. Tiago is then going to update on financials. And then I'll update on forthcoming milestones and then we'll have time for Q&A. So kick things off let’s discuss the pipeline. And then specifically let’s talk about the Scleroderma program. So recall back in Q2 that we completed enrollment in the STAR US Scleroderma approval trial. Next week at the American College of Rheumatology meeting in Washington D.C. we're going to be presenting some high level preliminary results from that trial. Again that trial remains blinded, but the presentation will include details about the ease and acceptance of the procedure, it’s safety profile and reveal some of the baseline characteristics of the scleroderma patients treated and that will be presented in poster format and will be happy to make that available to you when it's published. Also as a reminder the full 12-month data readout in STAR is still expected in mid-2017. Things are going well there in terms of data collection. On the last call I mentioned U.S. orphan status and we're still waiting for approval. We have some…

Awesome. Thanks Marc. That’s good to have you here and I appreciate the opportunity to provide an overview of our results about Q3 and our year-to-date and then some of the key activities. We've seen some seasonality in our historical revenue and Q3 for us ended a touch softer than those trends. Now year-to-date excluding Lorem Vascular our results are pretty good, revenues up by 28% and consumable utilization is actually up 35%. Our Q4 looks like it will be in line with previous years. In other words, we should have a strong quarter as our funnel is robust. I want to start off by highlighting Japan which remains central to our strategy. Our clear objective in Japan is to build a robust and profitable business and why is that while the environment in Japan is favorable to Cytori. The new regenerative medicine law which was enacted in 2014 is well understood and it’s now providing regulatory stability. Our year-to-date metrics are solid revenue Japan year-to-date is up 60% when compared to 2015 and our year-on-year consumables are up 76%. Now this growth is driven by our base of business in the aesthetic market and where we see continued demand. Additionally, we remain very encouraged with opportunities in knee osteoarthritis. We've done extensive evaluation of the market and noted a sizable number of patients who have few good treatment alternatives. Elderly Japanese have a good amount of disposable income and we've seen three more osteoarthritis approved protocols including one with our [indiscernible] preservation process under the new regenerative medicine law and we also have more of these facilities in the pipeline. Additionally, our team has been working very diligently as Marc mentioned to move clinical trials forward particularly in SUI, the ADRESU trial and then the new trial at Ariake…

Hey, Tiago, thank you. Let me talked about milestones for a minute. You can find that listed in our corporate presentation on the website, but regarding the second half 2016 milestones. First of all, in terms of treating patients under the compassionate use program as John mentioned we are really now in the scheduling phase. We've focused down on what we think that the best countries to be and going to one specific center in each country and working hard to make that happen. And I think we're making a ton of progress despite the fact that we only have about one and a half employees on the ground in all of Europe. Our plan is to stick with that level of investment that's not going to increase until we fully validated the opportunity and at that point we will make increased investments as is wanted. We have obtained the EMA feedback as I mentioned on the conditional marketing approval in Europe and the U.S. orphan designation is still pending. I also mentioned our U.S. IDE FDA approval trial for BARDA is on track and ready to file soon. And that the European Scleroderma trial for the reasons I mentioned before is delayed, but they're adding side so we think that will get done next year, more on that later. And then just around the corner 2017. I would say everything's on track to file our U.S. PMA for scleroderma pending receipt of the data, getting enrollment started on the Phase I burn trial RELIEF getting full enrollment on the ADRESU approval trial for urinary track incontinence in Japan and getting enrollment started on this new breast trial once we get formal protocol approval. And just as an aside in early 2017, we will be rolling out the naming and branding convention on ECCS-50 which is largely done, but we look forward to rolling that out to the market. So with that, Kristen, I will turn the call over to Q&A.

Thank you. [Operator Instructions] Our first question comes from the line of Jason Kolbert with Maxim.

Hi, thank you for the very comprehensive front down. Marc terrific [indiscernible] and I understand you're in Japan. Talking a little bit about Lorem Vascular. Can you discuss with me what the plans are in terms of China? I was recently in China and I realize what a tremendous opportunity is in that country and so I’d like to understand kind of the relationship with Lorem Vascular and how that might go. And also by the way I'm very excited about the breast cancer reconstructive trial. I think that's very exciting. And then I want to ask you a few more questions about the scleroderma program and STAR and kind of exactly what kind of feedback you might be hearing from investigators and what your net feel is on how the trial was going? Thanks.

Hey, Jason. Thanks for the question. So China is I think potentially a great market despite the fact that they've had a recent law change that I think the market is still cycling through our view is the market still open for business there. Lorem Vascular has five licensed territories and they effectively have all fields of use in those five territories which includes China except for alopecia. So enormous opportunity there and we think that there's opportunity to drive things faster in that market that are being driven today. And so we're in discussions with Lorem as to how we can find some sort of solution to make sure that investment dollars and strategic plans are developed that can really leverage those opportunities. So I think the stage of the discussions with them is sensitive. So I want to be careful not to say too much more, but suffice to say we view it as a great opportunity and want to make it happen there. Regarding the breast trial so you and I talked about this a lot the therapy is safe and it works in breast and I've done many of these procedures myself. In fact I did the first 20 myself here in Japan and we had the benefit of following those patients over a number of years. And seeing them and follow-up and their spin on growing use of the product in Japan, but what's changed is that the new regenerative medicine law that can't understate how important this is. It has really brought crystal clear clarity to the market about how things are moved through the regulatory process and because we are still advanced in Japan with respect to regulatory approval and we treated so many patients here we do have a leg up and this is an example of working with leading physician that we can leverage all the work we've done in the safety profile the 80 or so place systems around Japan. And you know a decade's worth of relationships and move a trial directly into an approval trial that is not going to really be much the cost center for us. The trial protocol is still under negotiation with PMDA we announce it now because it's been made public over here, so we wanted to just get that news out but I’d rather maybe wait until we have final protocol to really talk about the number of patients the primary endpoint of the trial design, length of follow-up and so forth.

Marc that’s great. Yes, if you talk just a little bit about kind of what anecdotal feedback you're hearing from the U.S. trial and kind of how that's going as we kind of march towards data. And then my last question will be you know how you plot the financial resources of the company, first is the next major inflection point? Thank you.

Yes. So Jason in terms of scleroderma we are blinded to the data. So our ability to understand how it's tracking is limited the American College of Rheumatology poster will provide some insight as to what we do know there's nothing in that that leads us to believe anything different that it's safe and it works. The blinded data that we've seen suggest our powering assumptions and so fourth are solid. And the feedback from physicians and some of the patients that I met with gave me a little bit of warm fuzzy feeling that we're on the right track.

Marc by the way. That’s extremely helpful, that’s exactly what I'm looking for that there is no changes in terms of your assumptions and powering data and then anecdotally you don't see anything outstanding or different about this trial versus the prior experiences. So that's really good feedback.

Yes, I think we feel good but at the end of day we don't know and will have to wait for the data. I would say that kind of - and this kind of leads into your next question about application of financial resources. As we become clear about the mechanism of action of the technology specifically around anti-genesis, improvement of inflammation, [invasive constriction] and wound healing. We are increasingly attracted to the opportunity of autoimmune and inflammatory conditions of the hand. There are a number of diseases besides scleroderma that include secondary renos, osteoarthritis of the hand, Sjogren's and so forth that have a hand component that fit overlap nicely with the mechanisms of the hand. So as we think about new trials and partnering we see the opportunity to build off scleroderma franchise and broaden the technology into that group of conditions related to the hand. And so I think we're going to spend a lot of time over the next few months really understanding where the opportunities are maybe make additional with careful investments there. Beyond that, we continue to grind away on expenses. We continue to demand profit from all the commercial activities that we perform. And we think that as I mentioned there is some BD opportunities that could help offset some of these investments and help get the Company to profitability.

Thank you, Marc. I really appreciate the overview.

Thanks, Jason.

Our next question comes from the line of Steve Brozak with WBB Securities.

Hey. Good afternoon, gentlemen and thank you obviously for the detail that you've gone into. Just a quick question on business development updates, I mean you intimated at it in terms of going out there in interest, but can you describe anything on the biz dev side and especially in the heightened interest on the programs now that you've completed enrollment of the Phase III on hand dysfunctional trial in scleroderma. And can you give us much color is that is possible because obviously people are looking to see what you might be able to look at as far as external interest to validate everything you're doing? Thank you.

Hey, Steve. Okay, happy to do what I can and I think I understand the question and I'll be sensitive as I can on what we could talk about and what we can’t. Talking about deals that aren’t fully negotiated and reported is the sensitive matter. We start with just big picture, what if we've been trying to accomplish and is that a little bit like a broken record, but we've been focused on trying to find a regional partner in Japan for scleroderma and a regional partner in Europe for the managed access program because we can't afford to invest the kind of dollars you need to build that program out without a partner. So having partner there would be good. And so we have discussions which include term sheets in both of those areas and so there are some possibilities there, but we want to see some things from a partner and we're not going to deal until we see. We have a list of few things we want to see. But we have some interested parties in both of those and kind of in parallel because of the U.S. data and that trial being enrolled and I think showing some promise in the pilot trial. I think there is some interest in expanding out to a global partnership and that partnership might extend beyond scleroderma into these autoimmune conditions of the hand which represent much bigger markets. We are actually putting that on the table in terms of our dialogue. So I think there are some opportunities there. No promises. We won't do a bad deal. We will say no before we do a bad deal, but we're looking to get either a global regional deal done from the parties that we’re talking with today. So that…

Thank you for that detailed answer. You hit the nail on the head. The right deal is obviously what all the shareholders and investors are looking for. Good to go. Thank you for taking the question.

Thank you, Steve. Tiago Girão: Just quick Marc. I got a question here on email. This is Tiago. With respect to BARDA and the schedule payments and the expectation, I can comment on that and please chime in if you have any thoughts in addition to mine? So we recently reported in September, we got a $2.5 million extension of our current contract with BARDA that allows us to bridge the funds on the program up until we believe the time when we're going to initiate a clinical trial. And that clinical trial is a milestone that BARDA will likely fund and we expect to be somewhere between the $8 million and $9 million, but we don't know yet until we file and get the FDA feedback we won't know the exact number, but that's what we anticipate. And I don't have yet guidance for 2017, but I expect – for Marc’s comments I expect that we will have some spend of that money, hopefully a decent amount of revenues related to those funds in 2017 as we expect to initiate enrollment in the trial in mid-year or so of 2017. So that's the comment about BARDA. They remain very good partner of ours. We maintained that monthly invoices and we're actively discussing with them the next steps in the project. End of Q&A

And there are no further audio question at this time.

Thank you, Kristen, and thanks to those on the call and you listening after the fact. Appreciate your interest and support to Cytori. I got three things to close off here that I want to highlight. First, regarding the R&D pipeline. It's critical for the Company to continue to drive enrollment in our existing trials that are late stage approval trials, but we're still trying to wisely expand our thoughts and goal without materially increasing our cash burn. And we are trying to be cagey about how we do that, but we think we have some opportunities there as I mentioned. Secondly, now that the dust is settled on the regulatory situation in Japan as John mentioned. I want to really highlight the promising commercial trends that we're seeing there in terms of consumable utilization and new center approvals. There's a real business there that has a big upside and we have our broadest regulatory approvals there, a strong installed base, a really permissive environment and a lot of KOL. So I think that – in effect that’s doing over there is it's showing proof-of-concept that this idea and this technology can work broadly speaking economically in a market and profitably. And then finally follow-up to Steve's question about deals. I think we don't want to commit to any deals, but the advanced clinical pipeline we have and promising data is increasing the partner interest and we’ll try to leverage that in some logical, but multiple ways and we'll keep you updated when we have something done there. So finally, on behalf of the board and the management as always we really appreciate shareholders hanging tough and their support on the Company and its mission. We continue to be highly optimistic and really just doubt about what we're seeing, it’s been a long hard road, but we're really close. And to the patients and the doctors who trust us we thank you and thanks to our advisors and analysts who are on this call. And finally thanks to our hardworking and dedicated employees for all they do. Thank you again and have a good evening.

Ladies and gentlemen, thank you for joining Cytori’s third quarter 2016 earnings conference call. This does conclude the conference call and you may now disconnect your lines. Have a wonderful evening.