Palatin Technologies, Inc.

Greetings. Welcome to Palatine's second quarter fiscal year 2026 operating results conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference call is being recorded. Before we begin our remarks, I would like to remind you that statements made by Palatin are not historical facts and may be forward-looking statements. These statements are based on assumptions that may or may not prove to be accurate and that the actual results may differ materially from those anticipated due to the variety of risks and uncertainties discussed in the company's most recent filings with the Securities and Exchange Commission. Please consider such risks and uncertainties carefully in evaluating these forward-looking statements by Palatin's prospects. Now I would like to turn the call over to our host, Dr. Carl Spana, President and Chief Executive Officer of Palatin. Please go ahead.

Thank you and good morning, everyone. Earlier today, we reported Palatin's financial results for the second quarter of fiscal year 2026 and provided a corporate update. With me on the call today is Steve Wills, Palatine's Chief Financial Officer and Chief Operating Officer. Today we will highlight our progress advancing our Milan Accord IV receptor-based obesity pipeline, review recent strategic and financial milestones, and outline our priorities as we move through 2026. Before opening the call for questions, first I will turn the call over to Steve for the financial and operating results. Steve.

Thank you, Carl. Hello and welcome, everyone. I'll walk through our second quarter, fiscal 2026, operations, and financial results. Starting with our recent public offering on November 12, 2025, we closed an upsized 18.2 million underwritten public offering, including the full exercise of the over-allotment option. The offering consisted of approximately 2.8 million shares of common stock or pre-funded warrants in lieu thereof, along with Series J and Series K warrants at a combined public offering price $6.50 per share and accompanying warrants. Each Series J warrant has an exercise price of $6.50 per share and expires on the earlier of 18 months from issuance or 31 days following FDA acceptance of an IND for an in-house obesity treatment compound. Each Series K warrant has an exercise price of $8.125, $8.12 and a half cents per share and a five-year term subject to automatic termination if the associated Series J warrants are not exercised within the FDA exercise period. Gross proceeds from the offering were approximately 18.2 million, with net proceeds of approximately 16.9 million after underwriting discounts and offering expenses. While the company may receive up to an additional 18.2 million upon the exercise of the Series J warrants, There is no assurance that these warrants will be exercised. The net proceeds from the offering are being used to support the advancement of our obesity programs, as well as for working capital and general corporate purposes. As a result of the closing of this financing, Palatin regained compliance with NYSE American continued listing standards, and effective November 12, 2025, our common stock resumed trading on the NYSE American under the symbol PTN. Turning now to the financial results for the second quarter ended December 31st, 2025. Regarding revenue for the quarter was $116,000 compared to zero revenue in the comparable period last year. This revenue relates to cost reimbursements under our collaboration agreement with Bernal Engelheim. Total operating expenses were $7.4 million for the quarter compared to $2.6 million in the prior year period. The year-over-year comparison is primarily impacted by the gain on the sale by lease recorded in the December 31st, 2024 quarter, which reduced net operating expenses in that period. In the current quarter, operating expenses increased due to higher investment in our Milana-Corton-based obesity development programs, as well as increased compensation costs and professional fees. Other income net was approximately $65,000 for the quarter, compared to approximately 169,000 in the prior year period. The decrease reflects lower investment income and foreign currency translation gains, partially offset by lower interest expense. Net cash used in operations was $4.8 million for the quarter, consistent with the same quarter last year. Net loss for the second quarter was $7.3 million, or $2.86 per share, compared to a net loss of $2.4 million, or $5.92 per share, in the comparable period last year. This change reflects higher operating expenses associated with advancing our pipeline programs, as well as the absence of the bilesi divestiture gain recorded in the prior year. Turning to our cash position, as of December 31, 2025, we had $14.5 million in cash and cash equivalents, compared to $1.3 million at September 30, 2025, and $2.6 million at June 30th, 2025. Based on our current operating plans, we expect our cash runway to extend beyond the quarter ending March 31st, 2027. Finally, with respect to our PL 9643 sub-licensing transaction, in January 2026, we received approximately 3.8 million of upfront consideration in the form of non-cash debt cancellation. This amount is reflected in the current liabilities as of December 31st, 2025, and will be recognized as license revenue in the quarter ending March 31st, 2026. In summary, the successful completion of our public offering significantly strengthened our balance sheet, restored our NYSE American listing, and provides the capital needed to advance our obesity pipeline while maintaining operational flexibility. With that, I'll turn the call back to Carl for program updates. Carl?