Kamada Ltd.

Welcome to the Commodore Limited First Quarter 2020 Earnings Conference Call. At this time, all participants will be in listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star-0 from your telephone keypad. Please note that this conference is being recorded. At this time, I'll turn the conference over to Bob Yeted with LifeSite Advisors. Bob, you may begin.

Thank you. Good morning, this is Bob Yadeed with LifeSci Advisors. Thank you all for participating in today's call. Joining me from Kamada are Amir London, Chief Executive Officer, and Chaime Orlev, Chief Financial Officer. Earlier this morning, Kamada announced financial results for the first quarter ended March 31st, 2020. If you have not received this news release, then please check the company's website www.comada.com and go to the Investors section. Before we begin, I'd like to caution that comments made during this conference call by management will contain forward-looking statements that involve risks and uncertainties regarding the operations and future results of Comada. I encourage you to review the company's filings with Securities and Exchange Commission, including without limitation the company's Forms 20-S and 6K, which identifies civic factors that may cause actual results or events to differ materially from those described in the forward-looking statements. Furthermore, the content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, May 18th, 2020. Comida undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call. With that said, it's my pleasure to turn the call over to Amir London, Chief Executive Officer. Amir?

Thank you, Bob. My thanks also to our investors and analysts for your interest in Kamada and for participating in today's call. I hope you all are keeping safe and healthy in these challenging times. As you know well, the ongoing COVID-19 global health pandemic continues to cause meaningful complications to daily life and business operations. We are focused on the safety and well-being of our employees who continue to find innovative solutions to support our patients and partners. We are grateful to the healthcare professionals around the world who are selflessly caring for patients on the front lines of this pandemic, and our thoughts go out to all those who have been affected. Let's now move on to our strong overall results in the first quarter of 2020. I am pleased to report that we delivered robust financial and operational results during the first three months of the year. In the first quarter, total revenues were $33.3 million compared to $26.8 million for the first quarter of 2019, representing an increase of 24%. These results were driven by a 24% year-over-year increase in sales of both our proprietary and distributed products. From a profitability standpoint, our total gross profit for the first quarter of 2020 was $11.5 million, and gross margins were at 34%. This compares to $11.2 million of total gross profit and 42% margin in the first quarter of 2019. As it relates to the COVID-19 pandemic to date, our manufacturing plant remains operational with no effect on business continuity even amidst the emergency regulations enforced in Israel in recent months due to the pandemic. Moreover, Based on the most recent interactions with our U.S. distribution partners regarding finished product inventory levels available for distribution in the U.S. and our planned supply for the remainder of the year, we do not anticipate meaningful supply shortages in the foreseeable future in the U.S. market for Glacier or Kedrab. In addition, based on currently available inventory levels and planned supply of our distributed products in Israel, We do not anticipate significant supply shortages in the foreseeable future. Going forward, although certain COVID-19 pandemic-related dynamics may affect market demand and production conditions, we intend to maintain our current manufacturing supply plans and we have increased inventory levels of raw materials through our suppliers and service providers in order to appropriately manage any potential supply disruptions and Secure Continued Manufacturing. With all of this said, we are maintaining our previously provided full year 2020 revenue guidance of between $132 million and $137 million. As we move forward in this COVID-19 environment, it's important to highlight that we maintain an extremely strong balance sheet. In fact, we continue to grow our cash position which increased to $96.4 million as of March 31, 2020, a significant increase as compared to the $73.9 million at the end of 2019. This includes a $25 million private placement we closed earlier this year with the Fini Opportunity Fund, the leading Israeli private equity investor, which is our largest shareholder. I'd now like to discuss our plasma-derived hyperimmune IgG therapy for COVID-19 development program. As previously reported, during the first quarter, we were able to quickly focus our efforts on the development and manufacturing of the product, which leverages our proprietary IgG platform technology as a potential treatment for COVID-19 patients. We are pleased to report today that we have secured adequate quantities of COVID-19 condolence and plasma from Israeli donors. This has enabled us to initiate an affection of the product, which is expected to be available during the next six weeks by the end of the second quarter for compassionate youth treatment in Israel. Concurrently, we have ongoing discussions with the Israeli MOH with regards to potential initiation of related clinical trials. In addition, we're excited to announce our global collaboration with Kedron Biopharma, which will allow us to develop the products more rapidly and broaden our international reach. Based on the agreement, Kedron will provide plasma collected at its CAD Plasma Center from donors who have recovered from the virus, and upon receipt of regulatory approvals, we'll be responsible for commercialization of the products in the U.S., Europe, Australia, and South Korea. We are responsible for product development and manufacturing utilizing our proprietary IGG platform technology as well as clinical development with Cadrian support and regulatory submission. We also have distribution rights in all territories outside of those under Cadrian responsibility. The initial primary focus of the collaboration will be to provide the product We look forward to providing you with further updates as warranted on this important development program over the coming weeks. I would now like to spend a little more time discussing the significant commercial progress we are making with our anti-REBIS IDG product. In the U.S., CADREX market share increased from approximately 10% in 2018 to approximately 20% in 2018. In Canada, where the product is known under the brand name Kamrab, Kamada and its local partner, Vaniva, a well-established vaccine company, is commencing product distribution following a recently awarded supply tender. Moreover, Kamrab's sales in Latin America, commenced last year, are growing through the 2019 to 2021 tender from the Pan American Health Organization, PAO, the specialized international health agency of the region. Moving on, I would like to also provide an update on the contact manufacturing program we've announced late last year. As you may recall, in December 2019, we entered into a binding term sheet with an undisclosed partner for contact manufacturing of an FDA-approved commercialized hyper-immune globulin product. The program is progressing according to the plan, and we are working on the tech transfer of the product to our manufacturing facility. Commercial supply of the 12-year contract is expected to commence in early 2023, following the completion of the required tech transfer. Based on current market share volume, the new product is estimated to add approximately $8 to $10 million in annual revenues to Canada at estimated gross market levels similar to our average gross margin of the proprietary product segment. This agreement supports our strategy to leverage our experience and available manufacturing capacity at our FDA-approved manufacturing facility to initiate the production of additional plasma-derived products following the planned transition of glassware manufacturing to Takeda during 2021. Moving on, let's turn to the current status of our innovative Phase 3 clinical program for our proprietary inhaled AAT for the treatment of Alpha-1 deficiency. You will recall that the first patient in the Phase 3 trial in Europe was randomized in the fourth quarter last year. We were pleased with the rate of enrollment into this study through February 2020. However, in March, Due to the effect of the COVID-19 pandemic on healthcare systems, recruitment into the Innovate Study was temporarily halted. While the evolving healthcare environment makes it difficult to know when recruitment will resume, our current expectation is that this will occur during the third quarter of this year, pending appropriate conditions at clinical trial sites. As a reminder, this study is being led by Dr. Jan Stoltz, Department of Criminology, member of the European Reference Network Lung at the Leiden University Medical Center in the Netherlands. INNOVATE is a randomized, double-blind, placebo-controlled, pivotal, phase 3 trial designed to assess the efficacy and safety of inhaled AAT in patients with alpha-1 deficiency and moderate lung disease. Up to 250 patients will be randomized one-to-one to receive either inhaled AAT at a dose of 80 mg once daily or placebo over two years of treatment. The primary endpoint of the INOVA trial is lung function measured by FEV1. Secondary endpoints include changes in lung density measured by CT scan as well as other parameters of disease severity such as additional pulmonary functions, This is a patient's rate and six-minute work test. In connection with the innovative study, we are also happy to provide an update that we obtain FDA acceptance for the protocol design of a 30-patient sub-study, which is required by the agency designed to evaluate the effect of our inhaled AAT on the pharmacokinetics of IV AAT and collect safety and immunogenicity data including the effects of anti-drug antibodies on AAT levels in plasma. Initiation of this sub-study has currently been delayed due to the pandemic. With that, I will now ask Chaime to read you our financial results. Chaime?