Brainstorm Cell Therapeutics Inc.

Good day, and welcome to the Brainstorm Cell Therapeutics first quarter 2020 conference call. At this time, all participants are in listen-only mode. As a reminder, this call is recorded, and I would now like to introduce your host for today's conference, Mr. Sean Leos from ICR Westwick. Mr. Leos, you may begin.

Thank you for joining the Brainstorm Cell Therapeutics call. Before we begin the opening remarks, We would like to remind listeners that this conference call contains numerous statements, descriptions, forecasts, and projections regarding Brainstorm Cell Therapeutics, NASDAQ, BCLI, and its potential future business operations and performance, statements regarding the market potential for the treatment of neurodegenerative disorders such as ALS and MS, the sufficiency of our existing capital resources for continuing operations in 2020 and beyond, the safety and clinical effectiveness of our Neuron technology platform, our clinical trials of Neuron and related clinical development programs, and our ability to develop strategic collaborations and partnerships to support our business planning efforts. Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond our control. including the risks and uncertainties described from time to time in our SEC filings. Our results may differ in material from those projected here on today's call. We undertake no obligation to publicly update any forward-looking statements. Joining me on the call today will be Hein Leibowitz, CEO of Brainstorm, Dr. Ralph Kern, President and Chief Medical Officer, David Setboom, Chief Operating Officer, Freedom Shaw, Chief Financial Officer. They will be available to answer your questions during the Q&A session.

Thank you, Sean.

Good morning and good afternoon to everyone on the first quarter 2020 earnings call. I would like to begin by thanking everyone for participating in today's call and for all those that sent their questions prior to our call. We will address many of your pre-submitted questions in the opening remarks, and we look forward to addressing any additional questions or comments you may have during the Q&A session. Although the global markets and the coronavirus pandemic has impacted all of us, the first quarter of 2020 has been productive for Brainstorm. As we continue to execute on our goal of bringing much needed treatment to those suffering from neurodegenerative disease. On behalf of the entire Brainstorm management team, I would like to express my sincere appreciation for the ongoing dedication and support we have received from patients, their families, caregivers, and all those who are helping us advance the phase III ALS clinical trial. I also want to thank our team at Brainstorm who fully devoted themselves to advance best in class, and potentially life-altering therapies. And finally, I would like to thank our shareholders for their continued ongoing support on our collective journey to a potential FDA approval of Neuron and ALS. We're happy to share with you that our fully enrolled Phase III ALS clinical trial remains on track for a Q4 2020 top-line data readout. Through the pandemic, our partner healthcare institutions have prioritized investigational ALS therapies despite severe COVID access restrictions, and we've been able to continue to deliver most scheduled treatments with occasional scheduled changes only. We have also aligned with the FDA guidance and enabled non-treatment visits to be conducted remotely by phone to optimize patient safety. As we previously mentioned, the clinical trial primary outcome measure The ALS-FRS-R rating scale is fully validated for telephone administration, and we have trained, timely, and certified all of our clinical trial sites to support this effort. Regarding the Phase II progressive MS trial, we faced unexpected delays in new patient enrollment due to site closures for clinical trials related to the global COVID-19 pandemic. Therefore, the scheduled March and April 2020 treatments and new enrollments were deferred to May and June of 2020, despite all efforts from our principal investigators. We stay in close contact with all of these centers to hear the clinical trial activities and new patient enrollments we'll recommend soon as the impact of COVID-19 The company is currently collecting all clinical and biomarker data from treated patients. We still plan to perform an interim analysis after 50% of patients have received all three study treatments. I would like to now provide an update on the Israeli hospital exemption program. I'm happy to announce that the Ministry of Health has approved the extension of the ongoing which will enable us to enroll the full 13 patients. In addition, the Ministry of Health has also approved an expansion of the hospital exam program to include additional 13 patients. But currently the company has not completed treatment of all patients for the first 13 approved patients, as non-Israeli patients were not able to be assessed and or further treated at the hospital. from the end of March to this day due to imposed travel bans between Israel and other countries. The company is currently collecting hospital clinical data for the patients already treated at Tikhalov. Once the full data set for the first 13 patients is collected, we will perform a detailed analysis. I should also mention, depending on when such travel bans would be lifted, And as we get closer to the anticipated BLA filing date, we may elect not to make public statements about the hospital exempt outcomes, so as not to interfere with our interactions and communications with the FDA and other regulatory agencies. As we mentioned previously, the FDA would likely look at the totality of the data, including Phase II data and hospital exemption outcomes. As we announced yesterday, we have licensed a clean room facility at the Ichelov Hospital in Israel to support the manufacture of Neuron for Israel and the European Union. We believe that this will secure a GMP-compliant manufacturing capacity and enable Brainstorm to rapidly scale up production to provide Neuron to patients after regulatory approval, not only in Israel but across the European Union, and this will further support our pipeline activities in neurodegenerative disease. We are very pleased to be able to expand our ongoing collaboration with the hospital, one of the world's most innovative and respected medical centers. In addition, we have recently engaged the services of an experienced EMEA regulatory expert as we plan to approach the EMEA regarding to advance neuron in ALS and potentially engage with EMA across other pipeline indications. Finally, we recently strengthened our management team and board. I am pleased to announce that Dr. Ralph Kern has been promoted to president and chief medical officer of Brainstorm. I'm also happy that today David Setbone is joining our earnings call. David is our new chief operating officer. I want to extend David a warm welcome to the company David is an experienced international pharmaceutical executive who has directed commercial development, business strategy, and product launches for two decades at three major biopharmaceutical companies. David will play a critical role in our business development and partnering efforts. I'm also very happy to announce that Brainstorm's board has been strengthened by the addition of the renowned and distinguished economist, Professor Jacob Frankel. As chairman of our board of directors, in addition, we are pleased to add to our board Mr. Sankesh Abhi, a successful healthcare entrepreneur, executive, and investor. As Brainstorm advances our corporate objectives over the next few months, we believe that today our board has the right mix of expertise and experience from early R&D through product commercialization, strategic partnerships, and financial management needed to advance the company's objectives. On the financial front, we've been prudent and disciplined in our execution strategy. We have a strong balance sheet through strategic use of our ATM and the registered direct offering from Abbey Capital. Successful receipt of non-dilutive grants from CIRM and from the Israeli Innovative Association. We remain well positioned to efficiently run our business through upcoming product lifecycle events. With that, I will now hand over the call to Dr. Pridham Chow, our Chief Financial Officer, to discuss our first quarter financial results.

Thank you, Haim. It's my pleasure now to walk you through our first quarter 2020 financial performance. Research and development expenses net for the three months ended March 31, 2020, were $5.95 million compared to $3.46 million net for the three months ended March 31, 2019. Excluding participation from IIA and CIRM under the grants and proceeds received from the hospital exemption regulatory pathway, research and development expenses increased by $1.94 million from $5.20 million in the first quarter of 2019 to $7.14 million in the first quarter of 2020. This increase year-over-year was primarily due to an increase in expenses in connection with our ongoing ALS Phase III and progressive MS Phase II clinical trials, a decrease in participation of IIA and CIRM in Q1 2020 under various awarded grants, and partially offset by proceeds received under the hospital exemption regulatory pathway. General and administrative expenses for the three months ended March 31, 2020 were $2.36 million compared to $1.47 million in the three months ended March 31, 2019. This increase year-over-year was primarily due to increase in payroll, stock-based compensation, PR and IR costs, rent, consultants, and travel. Net loss for the three months ended March 31, 2020 was 8.1 million or negative 32 cents per share as compared to a net loss of 5.03 million or negative 24 cents per share for the three months ended March 31, 2019. Cash, cash equivalents including short-term bank deposits were approximately 14.5 million at March 31, 2020 compared to approximately $6.2 million at March 31, 2019. Our total available funding as of March 31, 2020, which includes cash on hand as well as remaining non-dilutive CIRM and IIA grants, amounts to approximately $17.5 million. For further details on our financials, please refer to our Form 10-Q filed with the SEC today. Back to you, Haim.

Thank you, Pritam. Looking ahead to 2020, we're highly focused on generating top-line results for ALS Phase III program, and we'll make all necessary efforts to deliver progressive MS Phase II trial results in the fourth quarter of 2020, unless there are further unexpected delays due to the COVID-19 disruption. We look forward to working towards potential approval and initiating the regulatory submission and eventual commercialization of neuron and ALS, and to further advancing proprietary and innovative cellular technologies and enhance our manufacturing capabilities. We're actively working on additional preclinical and clinical opportunities to expand our pipeline to address unmet needs and to grow as a biotechnology company. This is an exciting year for us as we work towards executing on behalf of patients and shareholders. Lastly, we are all trying to adjust our lives and plans while doing all we can to safeguard public health and the well-being of our patients caregivers, principal investigators, and employees. I would personally thank everyone for working together and your continued support. I thank you all for your ongoing support of Brainstorm Cell Therapeutics. I look forward to your questions. As mentioned at the beginning of this call, Dr. Kern, David Setburn, and Dr. Shah will also join me to answer your questions. But before we open the lines for the questions and to reply to those already received, I would ask Please, Sean, you will be reading the Q&A. But before we start that, David, just introduce yourself to the investor community and say a few words about your vision of Brainstorm before we hand over for the Q&A to Sean. David.

Thank you. Yeah, thank you very much, Chaim. Good morning. I'm extremely honored to reinforce such a senior executive team and such a strong governance. I have obviously been following brainstorms, neuron technology, and its clinical development with a lot of interest for a while. It is confirmed it could change the treatment of care for patients suffering from ALS and other neurodegenerative diseases, and this across the world. What I can say in addition is during the last month, I observed first and two critical impressive developments for a company of this size. Number one, the ability to stay on track for the ALS space research, and this despite COVID-19. Number two, I'm very impressed by the deep scientific and technical expertise that we have behind Neuron, which was demonstrated again recently in the new data published in Immunomodulation. I can tell you that I'm putting all my energy, my heart, my experience to serve our unique patient-centric mission. My first objective is to accelerate our engagement plan and discussion with strategy and commercial partners across geography to serve our patients and to leverage the potential of neurone technology. Thank you.

Thank you very much, David. Sean, let's ask the... Please.

Thank you. Your first question for the team is, can you please elaborate on the impact of COVID-19 on the ALS trial? What approximately was the timeline of the last patient visit? When will you get the top-line data? When will it be presented? And what is your timing for the BLA process?

Thank you. So since our last call in March, much has happened due to the COVID-19, which forced us to adapt and respond. But our primary focus was and is to complete the ALS phase 3 clinical trial by the end of the year, preparing for a BLA submission and ensuring commercial preparedness, including building manufacturing capacity and expanding our human resources capabilities. As you can see in today's news, even despite the impact of corona, we are advancing on all of these fronts. Not everything was announced. Today we announced that we are maintaining the phase of phase three activity to complete all study treatments and assessments by the end of the year. This has demanded our focus and resolve working closely with all six United States investigation sites at a time when most clinical trials in the U.S. have ceased operation. We are very fortunate that our Phase III clinical trial was fully enrolled before this pandemic, and we were able to continue the treatment through this COVID-19 restrictions. Our commitment to the ALS community drives our resolve and those of our Phase III partners. We have kept that commitment. All of our manufacturing facilities are operating and growing in this period without delay. As you know, the hospital exemption program has been adversely impacted by the international travel ban. I know many of you are disappointed. You want to hear some of the exciting results I was talking in the previous call. We don't control the COVID-19 pandemic. And at that call, we didn't think that this program would have been delayed. Just a little bit more detail, from the 13 patients, eight are Israeli and five are not Israeli. And three of those five patients did not finish their treatment. Also, one of the Israeli patients still has to get to treatment. And therefore, the center is not comfortable to share results of bits and pieces. It's not professional. And as I said in the call, when we get closer to the On blinding, we may not be able to share this with the investor community. We will share the data with the FDA, as the FDA will look at the totality of our results. The same goes for the MS trial. We did anticipate that we will be able to do the same as we did with ALS with MS. Unfortunately, even though the principal investigators of these wonderful centers were supporting our view to continue with the trials, The centers, like Mount Sinai, they just shut down anything that doesn't have to do with COVID and is not life-saving. They did not agree to allow our MS patients to come in for treatment. Unfortunately, we as a company, Bud, we're ready to manufacture and treat all of those patients. I'm, again, so thankful that we were able to do that in the most important trial of the company now, ALS. Next question, Sean.

So your next question is, Why is the study design with a placebo arm? And why is the trial so long?

So the truth is I get, and all of us get, these questions on a daily basis to our Twitter accounts and to our emails. Lately, I think we are bombarded with a huge campaign from European patients, and we appreciate it. And we read every email. and we are listening to you, and it's important to us. And I think this is a very good opportunity to address some of these questions and explain our strategy more than we explained until now. But please, you must appreciate that we have to be very sensitive even when we explain our strategy. Since the completion of our phase two trial, Brainstorm worked diligently to find the best path forward that would enable us to provide access to patients while collecting the data necessary for an FDA approval. Even though we tried, we found that such a pathway to access Neuron for patients that is credible and economically feasible does not exist in the current US regulatory system. The Clinical Development Program for Neuron had to follow the only available FDA pathway for possible approval. The current phase three trial design is based upon the FDA guidance for therapy development at the time of the phase three trial initiation. Efforts to minimize the placebo arm decreased the total number of patients in the trial allowing an open label extension were advised against because they would decrease the chance of success as it would weaken the statistical power, and therefore the trial may not have been powered to demonstrate substantial evidence for effectiveness for an FDA approval. Definitely at this time, just a few months before the study completion, it would be irresponsible to do an interim analysis because it will decrease statistical power and may jeopardize the path to approval. We have consulted with experts, RPIs, statisticians, and other ALS experts. We have strongly advised us not to go on that pathway, not to risk the outcome. We are fully focused to have the best support we can pre-BLA submission. A BLA submission is predicted upon a successful completion and positive outcome from the Phase III trials. Next question, please, Sean.

So your next question is, when will the company announce a new indication for Neuron, and what will be your indication for exosomes?

Thank you. So we plan to announce a third clinical indication in June of 2020. We just need a bit more time to finalize the details and the regulatory interactions. and the study logistics, but we already know and the board already approved our next litigation, what center we are going to do it, who are our PIs, et cetera. Re-exosomes, we are constantly reviewing the data of our pre-clinical studies using our proprietary exosomes. It is true that our platform technology has potential across several indications. But it's important for me to say again that while we are planning to pursue these additional indications, I would like to be clear that our number one priority is to complete timely the ALS Phase III trial, assemble the data necessary to submit the BLA package, and gain approval in this indication. That is our commitment. Next question, please.

Your next question, what actions has Brainstorm taken to treat COVID-19 in Israel? There was an announcement seeking bone marrow donation. What exactly does that mean? Have patients been treated? And if so, what were the results? Ralph.

Ralph, you want to take the question?

Yeah, of course. Thank you. So, as you know, we closely follow several other companies that have an off-the-shelf MSD product that is being conducted in clinical trials in the U.S. and other countries. As you know, we don't have a ready off-the-shelf product. But I can tell you that our team has looked very carefully at COVID-19, including our the preclinical and clinical components and regulatory aspects. And we've decided to proceed with a small compassionate treatment program in Israel. We'll review the outcomes of that compassionate program, and we'll see if a later wave of COVID-19 could benefit from our in-house product that we're manufacturing. So to summarize, for the first COVID wave, which we see right now, we decided to not shift our resources away from ALS. And as I mentioned, our focus is on completing the ALS trial in a timely fashion. But we do have great expertise in the expansion of MSCs, and we're certainly ready to support manufacturing of these cells should they be found to be effective against COVID-19. So more to come at a later date.

Next question, please.

Your next question concerns the hospital exemption. When will 13 in the initial cohort be treated? When will the new cohort be started? When will we have the data? And will the delayed data overlap with the BLA process and limit the ability to communicate?

I think I discussed it in the opening statement, but I will answer it again because I see many investors are asking that question before the call. So I would like to now address these questions. As I stated in the opening remarks, the Ministry of Health has approved the extension of the ongoing study, which will enable us to enroll the full 13 patients. We had a date when we had to finish it. Due to COVID, that date was not met, of course, and they extended that because they are the ones that don't allow patients to visit Israel. In addition, the Ministry of Health has also approved an expansion of the hospital exam program to include additional 13 patients. Again, depending on when we will be able to allow more patients to visit the center here in Israel, we will decide if we will move forward with this expansion. As per the status, we have not yet completed all 13 patients approved, and only once that will happen, we will be able to gather the data and at least present it to the FDA, which is very important. I should also mention that depending on when such travel bans would be lifted, as we get closer to the anticipated BLA filing data, we may elect not to make public statements about these outcomes. As I said previously, the truth is it slipped. I, in the previous call, said that I'm excited in the data and will share it. I still would love to share it, but I do have to follow professional advice from the team working on the pre-BLA package. That's what's most important, I believe, for our investors and even more so for our ALS patients and for the company. We want to make sure that we don't take any risk not needed for the BLA package to be approved. Next question.

So your next question concerns the progressive MS clinical trial. How has COVID affected the trial? When will the company have interim and final data? Will the ALS data shorten the timeline for progressive MS? And how many patients are current or have been enrolled?

Well, thank you very much for that question. So regarding the phase two progressive MS trial, the main delay we found is in new patient enrollment. Obviously, we had already enrolled eight participants in this trial. And because of the site closures, we weren't able to bring new patients in during the second half of March and the entire month of April. And as I mentioned, hospitals such as Mount Sinai in New York were essentially locked down because of the terrible situation. I think that is lifting. We're in very close contact with all the investigators, and we expect the situation to improve. So we did notice that we are able to get biomarker data and clinical data from those who've already been treated, and we do plan to perform an interim analysis after 50% of the patients have received all three study treatments. We still feel that we may be able to complete the clinical trial by the end of the year. It depends on when COVID restrictions are relaxed. And obviously, we monitor that on a day-by-day basis. And as I mentioned, we're in very close contact with all the sites and with all the principal investigators. The second part of the question relates to the ALS data and how that might support the MS program progress. I think that clearly there is an opportunity there. I think safety and efficacy from ALS patients would be very important in interpreting the our progressive phase 2 data, and also next steps with the agency. And we think, perhaps more importantly, the biomarker data confirming the mechanism of action of neurons in ALS, progressive MS, and other neurodegenerative diseases will be self-supporting. So we anticipate that the data from our progressive MS interim analysis will be helpful for ALS, and we also believe that our final data for ALS will be helpful in advancing milestones in our progressive MS program. Thank you.

Thank you, Ralph. Next question, please.

Next question are, what are the company's plans in the European Union, the United Kingdom, and Canada? And how would David Setboon view expanding outside the U.S. markets?

Thank you very much. Rather than me discussing David Sedman's plans, I'll ask David, please, can you answer that question?

Sure. Thank you, Chaim. So a critical element in the development and the extension is obviously having the best advice in the regulatory side. And we recently hired a very strong European consultant and advisor, that's going to support us in this European regulatory effort. We are expanding our footprint, notably in the EU, and we are as well evaluating international market opportunities. I want to reinforce, however, that our immediate priority is the U.S., because it is where we have conducted our trials. With the support of the consultants, we are investigating accelerated regulatory pathways that would support the availability of neurons in the EU and in the UK. Obviously, how rapidly we can enter will depend on the flexibility and responsiveness of the relevant national and regulatory authorities. Thank you.

Thank you, David. Next question, please.

The next question concerning commercialization asks, how many patients will Brainstorm be able to treat and when? Will you be seeking a joint venture or a strategic partnership? And X is around, what's the situation with Medicare and the payers?

I think, David, you'll take this one also, please.

Sure. I want to reinforce what Haim said. We are committed to the vision, and our ambition is to ramp up our capability to be able to treat the relevant population at launch. We are obviously, as well, accelerating our engagement plans and our discussions with potential strategic and commercial partners across all geographies. This is obviously an important question, but we cannot give a precise answer right now. What I can tell you now is our manufacturing process has the potential to be scaled rapidly using automation, and we are in active discussion with key suppliers. And we do not want to risk those negotiations by discussing them too early.

Thank you, David. Next question, please.

The next question concerns manufacturing. In the last earnings call, it was mentioned that Brainstorm is preparing for commercialization by building internal and external production capacity, enabling the company to bridge early demand. That demand exists today. What is the status of these plans?

I think it's quite clear that we just announced today that the cleaning facility is in Israel. that will support the EU. It's a good first step. We are also preparing other centers, of course. We'll announce when they'll be ready, but it's all in the working. And also, we're finalizing the automation agreement, and that will have a great impact on the speed of this additional manufacturing capacity. Next question, please.

The question concerns financial. We received a question about the ATM. Can you provide more details, and how will the proceeds be used?

Thanks, Chaim, and thanks for the question. So during the quarter ended March 31, 2020, we raised approximately $19.6 million. in total via ATM sales. We raised about $17.8 million via our previous ATM facility, whose $20 million capacity we fully exhausted during the quarter, and raised an additional $1.8 million from the new $50 million ATM facility, which we activated during this quarter. We plan to use our available capital prudently and we'll deploy our funds to make progress on the following key business objectives. So we will use these funds to successfully execute and complete our Phase III ELS clinical trial and filing of the BLA, which as Haim and David mentioned, is our first priority. We'll be putting in place a pre-commercialization and launch strategy and plan, and as we approach the filing and BLA, we'll spend funds on continuing to advance our Phase II clinical trial We'll also advance our new pipeline indication once it's announced this summer. And then we'll be deploying these funds to scale up manufacturing capability of Neuron in Israel, broadly EU and the UK. And then finally, we'll also be pursuing a regulatory approval of Neuron EU for ALS and advance EU regulatory strategy across pipeline indications and jurisdictions. jurisdictions. Lastly, we'll continue to advance our preclinical studies and data analysis for additional pipeline indications using MST exosomes. So I think these are the different areas where we want to prudently deploy our funds. With that, I'll turn it back to Hein.

Thank you very, very much. And I think we have one more last question about The American Academy abstract, Sean?

Yes. The final question is, what are the most important conclusions from the abstract that was presented at AAN 2020? Both.

Thank you very much. So the abstract that was presented is critical in adding another layer of understanding to to how we position the mechanism of action of neurons, in particular, in this case, immunomodulation. What we observed in our experiments was that neuron, when combined with peripheral blood cells, increases BNT regulatory function in terms of the number of cells, and we found that this was mediated in part by the induced expression of IL-10. And for those who know this and those who don't, IL-10 is a very important molecule. It's known to be deficient in ALS. It correlates with the ALS functional decline. It also correlates with progressive MS disability. And it may be that increasing IL-10 and BNT regulatory function are important therapeutic strategies to rebalance the immune system. So we're very excited about this, and we're continuing to do more biomarker work as we speak. Thank you.

Thank you so much, Jerry. We're handing this back to you. If other callers want to ask some questions, please.

Thank you. We'll now begin the question and answer session for the audio conference. Anyone who wishes to ask a question, please press star 1 on your telephone keypad. If you wish to remove yourself from the question queue, you may press star 2. We'll now wait for polling for questions. We have a question from Jason McCarthy, Maxim Group. Please go ahead, sir.

Hi, everyone. It's Dave on the line for Jason. Thanks for taking my question. So you mentioned earlier on the call that you plan to perform an analysis once 50% of patients have been treated for the Phase II MS trial. I was hoping you could shed some clarity on when roughly we can expect the interim data readout. Thanks.

Hey, Ralph, it's Lee.

Yeah, thanks for the question. You know, at this point in time, we're hoping that over the next few weeks, the clinical trial sites will reopen. They'll be able to bring patients back, do assessments, enroll new patients, and continue their treatments. Unfortunately, we, you know, this is a very fluid situation, as you are aware. We are still hoping that later this month or early next month that we'll go back to our schedule. But at this point in time, I wouldn't want to estimate a specific date or time because there's a variable that we don't have control over.

Okay. Thanks for the additional clarity. Appreciate it.

Next question, please.

We have a question from Marcia Kaplan, Ameriprise Financial. Please go ahead.

Hi. My question is, what is the longest period that any of the clinical trial participants have been in the neuron trial? And have any of the trial participants from stage two or stage one ever been brought back into the trial for part three to see how long somebody who is getting positive results can continue to get treatment of neurons?

Very good question, Ralph.

Yeah, thanks for the question. The duration of the phase three study for individual participants is 11 and a half months. That includes seven months after the first treatment. So that's the duration of exposure that we have in the current population. Currently, the majority of patients in the phase three trial have received all three treatments And a significant number have actually completed all study assessments. So we'll have, that continues to grow by the month. We obviously will be looking to a last patient, last visit in the fourth quarter. And at that point in time, I think we'll have a good data set. In terms of the other aspects of the question, whether phase two patients came back for repeated treatments or other assessments, the answer to that is no, because that was a Phase II study, and it wasn't designed for a long-term follow-up. So thank you for the question.

Is there any plan to look into a second set of treatments for any of the patients?

So not at this time. We obviously receive a lot of questions about... you know, about what happens at the end of the study. And obviously we're looking at all options at this point in time, but we haven't made any decisions and we haven't announced any additional treatments that potentially could be offered. But we are thinking about it, obviously. So thank you for the question.

And I have a last part to this question. One of the things that I've been reading is the potential of, while the three treatments may have positive results for a certain percentage, of the clinical trial participants that there's also a period of time where it then wears off. Do you have any information on how long, if there's a positive result, it maintains in the participant before it wears off? Yeah, well, that's a very good question.

Yeah, thank you for that. That's a very good question. All treatments wear off. And ours is no different. What we saw in our phase two trial was that the median duration of effect was roughly, you know, within the range of two to three months. And that's how we chose a two-month dosing interval. There's also some preclinical data to suggest that the persistence of MSCs in animal models is about three months. We think that as long as the cells are there and continuing to deliver their cargo, which is the mechanism of action, that we can expect a treatment effect. And obviously we wouldn't expect a treatment effect beyond the persistence of the transplanted cells. So as our treatment is a drug, cells are a drug delivery system, we would think that, you know, repeated dosing is needed and that an interval of two months in our Phase III trial is the best option at this time. Thank you for the question.

Thank you. Operators, any other questions at this time?

At this time, sir, there are no further questions.

Do you want to insert once again how people can ask questions?

Okay. We do have, someone has just registered. We have John Nevins from Raymond James. Of course. Please go ahead, sir. Good morning, everybody.

A couple of quick questions. In the MS Phase II study, remind me, is it one injection or are we doing three injections? And the reason I ask is that, you know, if we stopped enrolling patients, it could be nine to ten months until we get that magic number of ten patients.

Ralph?

Yeah, thanks, John. Nice to hear your voice. John asked a tricky question, Ralph, you see? He does. And we appreciate the questions. The Phase II MS trial is, as you say, three doses. Obviously, if the situation in the hospitals persists without resolution, we would have to make a decision. What we hear from the various sites, and we've been in essentially daily contact with the experts at all those sites, is that they're planning to open up soon. And I think that the best course of action for us is to keep the protocol as is, provide three treatments to each individual in the trial, and then have a very strong data set. I think that anything that diminishes the quality of the data or the amount of data, I think, is not in the best interest to brainstorm the patients or investors at this time. So our plan is to continue with the schedule that we had originally set, and we'll see if we can get back to business as usual,

as soon as possible. Thank you. Okay. Thank you. Next question, back to everybody's favorite topic, the hospital exemption program. I see in the 10Q you've received $3.4 million from the HE to date. Who pays that?

Only the non-Israeli patients pay. The whole reason why the Israeli government wanted us to treat the Israeli patients, which can't afford anything, so they're paying zero.

Okay.

So it's really medical tourism... Opportunity allows us to treat a few patients in Israel for free. That was in return of not having an arm of the trial in Israel. A multinational trial would be a huge cost.

So the medical authority in Israel does not pay for the Israelis. It's done for free, and it's supported by the international patients.

Exactly. Five patients support the other eight.

Wow, so five patients paid over $3 million. That's not going to be the cost of Neuron. That's just for this program, I would imagine.

100%, and I think these patients are very good hearted people. Not only do they want to get the possibility of treatment, they really are very happy that other people are also getting this opportunity and it's the right time to thank them for it.

Okay, that's all I had. Thanks, gentlemen.

Thank you. Any other questions?

Once again, if you wish to ask a question on the teleconference, please press star 1 on your telephone keypad. That's star 1. Gentlemen, we have no further questions registered.

Thank you very much. Operator, you can proceed to the closing comments.

This concludes today's teleconference. You may disconnect your telephones. Thanks for calling.