Capricor Therapeutics, Inc.

Good afternoon, ladies and gentlemen, and welcome to the Capricorn Therapeutics first quarter 2025 earnings call. At this time, all participant lines are in listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Tuesday, May 13th of 2025. I would now like to turn the conference over to our CFO, AJ Bergman, for the forward-looking statement. Please go ahead.

Thank you, and good afternoon, everyone. Before we start, I would like to state that we will be making certain forward-looking statements during today's presentation. These statements may include statements regarding, among other things, the efficacy, safety, and intended utilization of our product candidates, our future R&D plans, including our anticipated conduct and timing of preclinical and clinical studies, Our enrollment of patients in clinical studies, our plans to present or report additional data, our plans regarding regulatory filings, potential regulatory developments involving our product candidates, potential regulatory inspections, revenue and reimbursement estimates, projected terms of definitive agreements, manufacturing capabilities, potential milestone payments, our financial position, and our possible uses of existing cash and investment resources. These forward-looking statements are based on current information, assumptions, and expectations that are subject to change and involve a number of risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. These and other risks are described in our periodic filings, named with the SEC, including our quarterly and annual reports. We are cautioned not to place undue reliance on these forward-looking statements, and we disclaim any obligation to update such statements. With that, I'll turn the call over to Linda Marban, CEO.

Thanks, AJ. Good afternoon, everyone, and thank you for joining today's first quarter conference call. Today, I will review the latest updates on the progress of our BLA, seeking full approval for Daramycin and treating Duchenne muscular dystrophy, cardiomyopathy, as well as a brief update on our pipeline programs. While we understand that there have been some changes at the FDA, we remain confident that the strength of our data, which I will highlight in a few minutes, combined with the unmet need in treating DMD cardiomyopathy, will potentially lead to approval. Our path with FDA to this point has been smooth, and FDA has not fallen behind in any way. Our objectives, deliverables, and timelines remain on track. There has also been concern expressed over the announcement of an FDA advisory committee meeting for Capricor. I want to highlight that having the opportunity to participate in an ADCOM is a positive step for Capricorn, for Darum ISL, and for the program as a whole, because it gives us the opportunity to showcase the strong scientific and clinical data that is the basis of our BLA. We do not believe, nor has FDA signaled, that the determination to hold an ADCOM had anything to do with weaknesses in the applications. but rather, we believe, the nature of a first-in-class therapy for a new indication warrants additional feedback from subject matter experts in the field, as well as giving the advocacy and patient community an opportunity to voice their opinion on Daromyosal. The ADCOM also affords us the opportunity to highlight that Daromyosal has a strong safety record, demonstrated in over 700 infusions, treating over 250 patients with some subjects receiving Daromyosal infusions for almost five years. We are asking for approval for a therapy that has been shown to be generally safe and effective for the treatment of DMD cardiomyopathy for which there are no approved therapies. For those new to the story, Daromyosal is a cellular therapy. It is a biologic comprised of a rare population of cardiac cells that reside in the heart. We have spent almost 20 years developing, characterizing, and harnessing their potential. Our clinical focus for the past approximately eight years has been Duchenne muscular dystrophy, a rare X-linked neurodegenerative disease with no cure afflicting approximately 15,000 boys and young men across the United States and over 150,000 across the world. These young men aim to live life as any strong-willed, young adolescent boy would desire to. But throughout the course of their life, they suffer from devastating symptoms, ranging from loss of ambulation, leading to full or part-time wheelchair use, deterioration of their upper limb function, leading to assistance needed to accomplish daily tasks, such as feeding themselves or taking a drink of water, followed typically by the use of ventilatory support for breathing, and ultimately, TMD takes their life. I highlight these things to paint the picture of what these young men experience in their daily lives and why it is so important to develop therapies to attenuate the disease process. Now, what is our indication exactly? It is the heart disease that affects every patient with DMD at some point in their lives. Every day, silently, the hearts of the DMD boys are being damaged. and no standard cardiac medication is good enough to combat that process. DMD cardiomyopathy is now the leading cause of death in DMD, and Daromyosal is the only therapeutic that has been shown to be effective in slowing the decline in ejection fraction, which is a measure of how the heart is meeting the needs of the body. While there has been some progress made in treating the dystrophinopathy with several drug therapies now on the market in the U.S., specific to the genetic mutation associated with the disease, there are no therapies approved or on the market that aim to specifically treat the cardiomyopathy associated with DMD. Daromyosal's mechanism of action, which is immunomodulatory and antifibrotic, is directly targeted to treat the secondary effects of DMD, and we believe can be used with other therapeutics, which are currently approved or in development to treat the genetic mutation. Daromyosal is delivered by a simple intravenous infusion once a quarter at a dose of 115 million cells. I would now like to discuss the data that supports our BLM. The filing is based on our blinded, randomized, and placebo-controlled HOPE II study, and also by the HOPE II open-label extension study compared to a robust FDA and NHLBI-funded natural history data set. While sample sizes are small, what is most relevant is not the size of the data set, but that the statistically and clinically significant differences are highly unlikely to be due to chance. We have worked with multiple internal and external statisticians, presented the data at meetings and to KOLs, and what we have heard, seen, and acted upon was that the likelihood is extremely low that the impact on the heart, or for that matter, the skeletal muscle, is due to chance. We have three clinical trials and approximately four years of open-label extension data that supports that premise. There has also been an emphasis and written guidance from FDA encouraging the use of real-world evidence to support clinical trial data, especially in rare diseases. ARAM-ISL is a perfect case for using this type of data to validate the efficacy of a drug product. Turning to the HOPE III trial, our Phase III study, which is ongoing and fully enrolled in the United States. I want to be clear that at this time, FDA has not requested the efficacy data from the HOPE III study to support our BLA application, although FDA has reviewed and will continue to review the safety data from the study. Our current plan is to use this data in the future for potential label expansion and are actively evaluating plans for HOPE III to be expanded internationally. We will provide more updates on this program as they become available. Now, as we are transitioning Capricor from a translational medicine company into a commercial stage entity, we continue to actively work with our commercial partner, NS Pharma, on launch readiness for the United States. As we announced earlier today, we also have appointed Dr. Michael Binks as our new Chief Medical Officer. I am extremely proud that Dr. Binks joined our team. He has over 25 years of experience leading global clinical development, translational research efforts across the industry. Most recently as Vice President and Head of Rare Disease, Clinical and Translational Research, Worldwide Research Development and Medical at Pfizer. and prior to that at GSK, where he was instrumental in advancing multiple first-in-class therapies in early and late-stage development. Based on our current plans, we aim to have over 100 patients transition from clinical to commercial products following potential BLA approval. Let me remind you that we have been providing DRAM-ISL to all open-label extension patients for over three years. Nearly all HOPE III patients are in open-label extension now and will transition to commercial products if it is their desire to continue on daromyosal. We, along with NS Pharma, are now working with physicians to assist them in preparing to prescribe daromyosal for DMD cardiomyopathy. We know it will be a partnership between treating neurologists and cardiologists in prescribing daromyosal. And this is part of the reason we are enhancing our medical leadership with Dr. Banks, who will guide the physicians through the prescribing process. Please remember that Daromyosal is not designed to compete with the medicines that address the dystrophinopathy, such as gene or exon skipping therapies, but rather to address the secondary aspects of the disease, which is inflammation and fibrosis, both in the heart and skeletal muscle. And again, has a very strong safety profile. It's important to note that a naturally derived cell therapy does not have the safety risk that is in any way similar to the gene therapies, which do involve viral vectors. Now, for an update on our commercial manufacturing preparations. As you know, we built our San Diego GMP manufacturing facility for the purpose of commercial manufacturing. So, I have a high degree of confidence in our processes, procedures, and facilities. To remind you, our San Diego GMP facility is fully staffed and operational and is currently producing doses of Daromyosal. In addition, we are underway with our previously announced manufacturing expansion to build additional clean rooms in the same facility. We plan on the expansion to be operational mid to late 2026, allowing us to bolster supply of the product to meet potential demands. Turning to an update on our European partnering opportunities, we remain in negotiations with Nippon Shin'yaku with respect to the potential distribution of Jeremiah Cell in the European region and have extended the period of negotiation of the definitive agreement through the end of the second quarter. Our strategy is emerging in regards to ex-USA markets, and we will continue to explore opportunities for our technology in other areas globally. We will add additional color as our strategy for Europe continues to unfold. And finally, for an update on our exosomes program, we continue to develop our Stealth X exosome platform technology as part of a next generation drug delivery platform. While this program has taken a backseat appropriately to Dyer Micelle, we are still working to develop exosomes as cellular delivery vehicles. We believe strongly in this opportunity. and the exosomes' ability to change the way we get biologics across the cell membrane. Our exosome development team is focused on advancing an efficient and cost-effective way to manufacture them for scale for therapeutic utilization. Despite all the concerns regarding vaccines based on the newer ethos of the FDA, I am pleased to inform you that our program under Project NextGen, which aims to test vaccine candidates for COVID-19 prevention and to prepare for future pandemics, remains underway. Our vaccine is very important because it is natural, made from the native proteins, and contains no adjuvants, which has been one of the main concerns of the new HHS Secretary. We continue to work in conjunction with the National Institutes of Allergy of Infectious Disease, otherwise known as NIAD, which will conduct the clinical trial and provide the data to us. This vaccine could potentially be game-changing, as it meets all the criteria set forth by the U.S. government on future vaccine technology. Phase one of the trial is set to start in Q3, and we will provide updates on this program as they become available. In conclusion, our program remains strong, both with our path to Jeremiah Health's potential approval and our Exxon's own platform. Our cash balance totals approximately $145 million, with our current runway taking us into 2027 with no additional infusions of cash. If we receive FDA approval, we will be slated to receive an $80 million milestone payment from Nipun Chinyaku, and we will also receive a priority review voucher, which we have the full rights to sell. These non-dilutive cash infusions could potentially total well over $200 million. This would allow us to enhance our therapeutic pipeline for Daromyosal as well as expand other areas of our pipeline in an effort to deliver value for patients and for our shareholders. With over 250 publications on the CDCs, including the Mechanism of Action of Daromyosal, and multiple statistically significant and clinically relevant clinical trials, demonstrating Jeremiah Cell's impact on patients. We look forward to presenting our data to the advisory committee. At this time, we don't know the specific date for the meeting, but we will alert the market when a date is set. I want to thank you for joining today's call. We truly appreciate your continued support. I will now turn the call over to AJ to run through our financials.