MediWound Ltd.

Good day, and welcome to the MediWN First Quarter 2022 Financial Results and Presentation of the S-Corrects Phase 2 Clinical Trial Results Conference Call. At this time, all participants are in a listen-only mode. Following management's prepared remarks, we will hold a Q&A session. To ask a question at that time, please press the star key followed by 1 on your touchtone phone. If anyone has difficulty hearing the conference, please press star 0 for operator assistance, At this time, I'd like to turn the conference over to Monique Cossie of LifeSci Advisors. Please go ahead.

Thank you, Operator, and welcome, everyone. Earlier today, Meadowoon issued a press release announcing its first quarter 2022 financial results and provided a corporate update. We will be reviewing those results with the management team, in addition to hearing from two KOLs on the results of the SGREX US Phase 2 trial. which were announced in a press release issued on May 12th, 2022. You may access both releases on the company's website under the Investors tab. With us today from management are Sharon Malka, Chief Executive Officer of Mediwoon, Ofer Gonan, Board Member, and Boaz Gurlevi, Chief Financial Officer. Also joining us are Professor Leo Rosenberg, Chief Medical Officer, and Dr. Sai Dove from Advanced Wound and Ankle Center, Las Vegas, and an investigator in the ASCREx Phase II studies. Before we begin, I would like to remind everyone that statements made during this call, including the Q&A session relating to MediWound's expected future performance, future business prospects, or future events or plans, are forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. Although the company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, actual outcomes and results are subject to risks and uncertainties and could differ materially from those forecast due to the impact of many factors beyond the control of Meadowood. The company assumes no obligation to update or supplement any forward-looking statements, whether as a result of new information, future events, or otherwise. Participants are directed to cautionary notes set forth in today's press release, as well as the risk factors set forth in METAWOON's annual report filed with the SEC for factors that could cause actual results to differ materially from those anticipated in the forward-looking statements. At this time, I would like to turn the call over to Sharon Maltha, Chief Executive Officer of METAWOON. Sharon?

Thank you, Monique. Good morning to our listeners in the U.S., and good afternoon to those joining us from Israel. Welcome to our first quarter 2022 conference call to discuss our financial and recent operational highlights. We are very pleased to have two esteemed key opinion leaders with us on the call today, Professor Leo Rosenberg, Chief Medical Officer of MediWound, and Dr. Sai Dav, a principal investigator in both our SCRx Phase II studies and the pharmacology study from the Advanced Wound and Ankle Center in Las Vegas. They will share their insights on our SCRx trial and data and also provide some perspective on the overall wound care practices. After our data discussion, we will hear a quick review of the financials from BOAS before opening the call for a Q&A. First, let me provide a quick review of our quarter and recent updates before taking a deeper dive with our KOL into the clinical data for Escarex. Starting with Escarex, we were excited to report positive data from the U.S. Phase II clinical study of Escarex for the debridement of venous leg ulcers. The study met its primary and its key secondary endpoints with statistically significant results compared to the control arms. The study demonstrated significant improvement over the current standard of care, and no observed deleterious effects on wound closure and no safety issues were observed. We highlighted some of these results at the SAWC Spring 2022 Symposium in April and received a very warm welcome and high interest by the top wound care specialists from around the globe. The interest was very encouraging, and we were very pleased to have received recognition for our poster, which was selected as one of the top 10 posters out of the 235 posters at the conference. In our NexoBread program, we continue to partner with Barda and Ferricel for the approval of NexoBread and look forward to bringing this innovative product to the U.S. market. We remain on track for a mid-year resubmission of the NexoBread BLA, and we anticipate a six-month review process which would position NexoBread for a potential approval by year-end and a commercial launch in the U.S. in the first half of 2023. To that end, BARDA expanded its contract, providing us with supplemental funding of $9 million to support the NexoBridge BLA resubmission and the ongoing expanded access protocol, which will run through approval. Lastly, on NexoBridge, we are proud to have started the project with the U.S. Department of Defense for the development of NexoBridge for the U.S. Army as a non-surgical solution for field care burn treatment. This research project, if successful, could open the gate for armies all over the world, as well as simplify our supply chain costs and administration. Let me now provide a quick review of SKRx Phase II study design and the key results before handling the call to our STEAM KOL. The study was a multicenter prospective randomized placebo-controlled adaptive design study evaluating the safety and efficacy of S-CAREX in debridement of PLUs compared to gel vehicle as a placebo control and compared to the non-surgical standard of care of either enzymatic or autolytic debridement. The study enrolled 120 patients with 119 treated at approximately 20 clinical sites, primarily in the United States. Study participants were treated by either SCRX 46 patients, gel vehicle 43 patients, or non-surgical standard of care and other 30 patients with a three-month follow-up. The single primary endpoint was incidence of complete debridement clinically assessed within up to eight medications during an assessment period of 14 days compared to the gel vehicle placebo control as agreed with the FDA. Secondary and exploratory endpoints assess time to achieve complete debridement, reduction of pain, reduction of wound area, granulation tissue, and quality of life, enabling evaluation of clinical benefits compared to both gel vehicles and the standard of care. Incidents and time to achieve wound closure were assessed at safety measurements. Turning now to the study results, the study met its primary endpoints with a high degree of statistically significant, demonstrating that patients treated with escarex had a statistically significant higher incidence of complete debridement compared to the gel vehicles. More specifically, 63% of the patients treated with Escarex, 93 patients out of 46, achieved complete debridement by the eighth treatment. And this compares with only 30% of the patients treated with hydrogel vehicle, which is about 13 patients out of 43, with a p-value of 0.004. Escarex efficacy superiority remains statistically significant compared to the gel vehicle, also after adjusting for pre-specified covariates ascribed to patient baseline characteristics, wound size, wound age, and region. The study also met its key secondary and exploratory endpoints that provide further insights on additional efficacy parameters and can establish clinical benefits. starting with head-to-head comparison with the non-surgical standard of care, including enzymatic debridement or autolytic debridement. Sixty-three of the patients treated with Escarex achieved complete debridement compared to only 13% of patients treated with standard of care, four patients out of 30 patients, within the 14-day assessment period. And the time to achieve complete debridement was significantly shorter. The estimated median time to complete debridement was nine days for patients treated with SKRx compared to 59 days for patients treated with a non-surgical standard of care with a p-value of 0.01. Moreover, on average, complete debridement was achieved after less than four applications with SKRx compared to almost certain applications with the non-surgical standard of care. This significant improvement over the current standard of care is important when you consider that the non-sharp debridement agents, enzymatic or others, currently available on the U.S. market require daily application for several weeks to achieve complete debridement, yet still generates hundreds of millions of dollars every year. Patients treated with escarex demonstrated significantly higher incidence of at least 75% granulation tissue at the end of the treatment period compared to the gel vehicle, with a p-value lower than 0.001, which is required for wound healing. And finally, a favorable trend were observed in wound area reduction and reduction of pain compared to gel vehicles. The above efficacy results achieved our key goals in this study. One, to demonstrate that escharic efficacy in debridement chronic wounds. Two, to establish a clear improvement over the current standard of care. And three, to give us a clear guidance for future pivotal studies in the indication of our interest. In addition, the study showed that SKRx was safe and well tolerated, and the overall safety was comparable between all arms. Importantly, there were no observed deleterious effects on wound closure and no material differences in reported adverse events. Actually, the estimated time to complete wound closure was 64 days for patients treated with Escarec, compared to 78 days for patients treated with standard of care. With that, we achieved additional goal for this phase to study, which was to assess the Escarec safety and tolerability, and show that it's well tolerated treatment for debridement of chronic wounds. Let me now turn the call over to Professor Rosenberg our chief medical officer, to provide us with some color regarding the unmet need, the role of debridement in wound management, the robust clinical evidence generated to date, and how a product like Escarex would fit the current treatment paradigm. Professor Rosenberg, please.

Thank you very much, Sharon, and good morning, everybody. First, I would like to thank our partners, the investigative staff, and especially the patients and their families for their commitment and perseverance in completing the study in the face of all the challenges posted by the COVID-19 pandemic. Let me start with a brief overview of the deployment role as a critical component of the wound management. Efficient debridement is an essential step in the acute and chronic wound management. Debridement is involving removal of non-viable tissue from chronic wounds to stimulate the granulation tissue and epithelialization. The underlying pathogenic abnormalities in chronic wounds cause a continual buildup of necrotic tissue, and regular debridement is necessary to reduce the necrotic burden and achieve healthy granulation tissue. Debridement also reduces wound contamination and therefore assists in reducing tissue destruction. Dead spaces that may otherwise harbor bacterial growth must be exposed during debridement. Routine care of non-healing chronic wounds starts with debridement. the necessity to induce the functional process of tissue repair. Five methods of debridement, selective and non-selective, are available, each with its own advantages and limitations. The choice of debridement techniques is highly dependent on the site of care, wound characteristics, and patient. Sharp debridement is the dominant debridement method used Non-sharp debridement techniques, mainly autolytic or enzymatic debridement, are primarily used adjusted to sharp or reserved for patients considered ineligible for sharp debridement. There is a great unmet need to effectively debride chronic wounds in an easy-to-use, non-surgical, and prompt manner to enable wound healing. Moving to the ASCOREX clinical evidence, I continue to be impressed by the compelling clinical data generated today in ASCOREX clinical trials. In the first phase two randomized control study, evaluating ASCOREX safety and efficacy in several etiologies, including VFU, diabetic foot ulcer, and venous leg ulcer, and post-traumatic mood. Patients treated with Escherich demonstrated a significantly higher incidence of complete debridement compared to patients treated with gel vehicle. Escherich, 55%, versus gel vehicle, 29%, with a p-value of 0.07. And complete debridement was achieved earlier in patients treated with Escherich. The effect was even greater in diabetic patients lower extremity ulcers, and in venous leg ulcers, an S-correct was safe and well-tolerated in all tested doses and dosing regimens. The robust results across multiple endpoints in the U.S. Phase II randomized control study for the debridement of VLU corroborated the results from the first Phase II study and demonstrated the potential significant clinical and patient-beneficial impact that S-Correct may have on patient life. S-Correct demonstrated significant higher incidence of complete debridement within up to eight applications, and that's compared for both jet vehicles and non-surgical standard of care. The time to achieve complete debridement was significantly shorter compared to the control arm with significant lower number of daily applications. In addition, Escarex demonstrated higher incidence of at least 75% granulation tissue post-debridement, which is critical for wound bed preparation toward wound healing with no deleterious effect on wound healing. Lastly, Data from our ongoing Phase II pharmacology study, Eskerix demonstrated safe and effective debridement of lower leg ulcers, both diabetic foot ulcers and venous leg ulcers, with few daily applications. Eskerix demonstrated significant debridement of wounds during the treatment period, average of 84% non-viable tissue removed, and significant decrease in wound size by the end of the two-week follow-up. In addition, an evaluation of the tissue samples and fluorescent images indicated a reduction of biofilm, score reduced from 2.44 at baseline to 0.7 post-treatment, and bacterial load following treatment with escharate red fluorescence in this scale reduced from 1.72 of baseline to 0.7 after debridement. The product like Escherac fits into the unmet need for a fast and effective non-surgical debridement for chronic and wound. It is an easy-to-use daily topical gel that as documented in the study, significantly improves the rate of complete debridement after a few applications, thus facilitating wound debridement. I believe that Escherich holds great potential to be a significant contributor in this market and welcome addition to our armamentarium for chronic wound care. Let me turn the call over to Dr. Kennedy Dove, who treated more than 10 patients with Escherich's as a principal investigator in both studies to share her clinical experience with Escherich's and how a product like Escherich's would fit within the current wound management practice. Dr. Dove.

Thank you, doctor, and good morning, everyone. It's my pleasure and privilege to join in this call and share my hands-on experience with Eshgar X. My name is Dr. Sandy Dove, and I am the owner and chief medical officer at Advanced Wound and Ankle Center in Las Vegas, Nevada, for the past 16 years. In our clinical practice, we deal with chronic non-healing wounds on a daily basis. A chronic wound, as we all know, is debilitating both physically and physiologically. It also serves as a point of entry for local and systemic infections. It is a huge financial burden on patients, caregivers and society. The data that we're talking about today is very positive and encouraging. and a disease where we really have very few treatment options that are effective and really work. Despite the growing number of new and innovative wound healing products on the market, why does the treatment of chronic wounds still continue to be such a great problem? For non-healing wound products to work, you initially have to have a wound that is clean and physiologically ready for these products. Effective debridement is a critical first step for wound bed preparation in order to facilitate effective wound management. As described by the doctor previously, the most commonly used non-surgical debridement methods include enzymes, we have hydrogels and other topical dressings, which require quite a long time to achieve a clean wound bed, if they achieve this at all. I've had the privilege of treating several patients suffering from either venous leg ulcers or diabetic foot ulcers with Eschar-X. In my experience, after several applications of Eschar-X, usually two to six applications, what we'll find is that the wound has a very vibrant, healthy, robust, and uniform granulation tissue. Granulation tissue that is ready to move on to negative pressure therapy or cellular therapy or even close secondarily. The level of debridement achieved via Eshkar-X is very precise and not something that I can replicate with traditional debridement methods, especially sharp debridement, which is typical. That is why it reinforces my belief that Eshkar-X is precise, And not, I'm sorry, that is why it enforces my belief that Eshkar-X has the potential to become a best in-class topical debridement product for the treatment of chronic wounds. We encourage many wounds to move forward with this continued clinical development. And I look forward to the day that Eshkar-X becomes available. I really appreciate the opportunity to speak to all of you today. And now I will turn things back to Sharon. Thank you.

Thank you very much, Dr. Dove, and thank you, Dr. Rosenberg. Your insights underscore the great need for a product that can effectively debride chronic wounds in a non-surgical, effective, and prompt manner. Chronic wounds represent a significant burden to patients, healthcare professionals, and the healthcare system. They affect millions of patients, and the cost of treatment runs into billions of dollars annually. We are excited to bring the S-CRACS clinical development plan forward, giving the magnitude of its commercial opportunity. In summary, debridement is a critical component of wound care. There are about 2 million patients with venous leg ulcers and diabetic foot ulcers that undergo debridement every year in the U.S. alone. The two most commonly used non-surgical debridement methods, enzymatic or autolytic, generates several hundreds of millions in cells every year, yet can take weeks to show effect, leaving much room for improvement. With Escarex, on the other hand, we're shown to be safe and effective in the department of heart wheel wounds with a few daily applications. Looking now to our plans for development, we believe the data from this study and the clinical evidence generated to date provides further insight on the additional efficacy parameters and can establish clinical benefits. This enables us to better design the pivotal studies. We plan to file that clinical data with the FDA and to request an end-of-Phase II meeting in the second half of 2022. Our goal is to work with the FDA on establishing a plan for a potential Phase III pivotal plan for S-Corect as soon as possible. SKRx clearly has the potential to become a game-changing therapy, and we are committing to bringing it to the market. We believe SKRx is well positioned to potentially become a best-in-class debridement option for millions of patients suffering from heart-wheel wounds and transforming wound management. Before turning the call over to Boaz for a summary of our financials, I want to address the news announced today of my transition to the board and the appointment of Ofer Gonen as a CEO. I have accomplished my goal as CEO of positioning the company for long-term success and strong future. Mediwound is on the cusp of a very exciting chapter. The company's pipeline portfolio is in a strong position for continued advancement including market expansion for our successful commercial product, NexoBreed, a potential near-term launch in the U.S. for this product, and a promising best-in-class therapy for wound care. It has been an honor to lead this company and the entire team at MediWound, and I look forward to supporting Ofer in my new role as a member of the Board of Directors and helping the company realized the tremendous opportunities that lay ahead. Ofer brings more than 20 years of experience in managing life science, investment, and global businesses. His extensive managerial experience in leading companies, global networks, and deep understanding of Mediun's strengths and potential position him uniquely to lead Mediun in its next phase of success. I will continue supporting the company as a board member, ensuring success with our BLA process and reinforcing our strategic alliances and collaboration. We are positioned for success and poised for our transformational year. Now, let me turn the call to Ofer, please.

Thank you. Good morning, everyone. I'm honored and excited to assume the role of MediWolf's chief legislative officer. Thanks to the strong foundation built by Sharon and his team, as well as the experience and ongoing support of our board of directors, MediWound has tremendous potential to grow into a leading global biopharmaceutical company. I look forward to driving the next phase of MediWound. We will continue to advance our lead program to expand patients' access to our technologies and increase value to our shareholders. Let me turn the call back to Sharon.

Thank you, Ofer. Now, let me turn the call to Boaz for a brief look at our financials. Boaz?

Thank you, Sharon, and good morning, everyone. As we have started what we believe to be an eventful year, we recently raised $10 million net. This fund, along with our next big commercialization effort and the expected upcoming BLA approval, provide us with a solid balance sheet to meet the upcoming milestones and activities throughout the next 24 months. Let me now review the financial statement of the quarter. Total revenues for the first quarter of 2022 was $4.4 million compared to $5.8 million for the same period last year. The decrease this quarter on a comparable basis was mainly related to product revenues due to a decrease in VADA's emergency stockpile decrement of $1.2 million. Gross profit was 1.5 million with a gross margin of 33% compared to a gross profit of 2.4 million and gross margin of 41% for the same period last year. Operating loss was 3.3 million compared with 1.9 million in the first quarter of 2021. This resulted primarily from a decrease in product revenues to board. Net loss was 3.6 million or 12 cents per share compared to a net loss of 2.9 million, or 10 cents per share, for the first quarter of 2021. Adjusted EBITDA was a loss of 2.6 million, compared to a loss of 1.3 million for the first quarter last year. Moving to our balance sheet highlights, as of March 31st, 2022, cash and short-term investments were 16.8 million. We remained on budget, utilizing 4 million in the first quarter of 2022 for operational activities. Again, our cash position is expected to be sufficient to support the anticipated operating activities for the next 24 months. For the full year of 2022, we expect cash use to be in the range of 11 to 13 million. With that, I have concluded the financial overview. I will now turn the call back over to Sharon. Sharon?

Thank you, Boaz. I'd like to thank the investigators and the KOL and patients who participated in this study, and especially to thank Professor Rosenberg and Dr. Da for joining us this morning. Naturally, we are grateful for their participation in our study and for giving us their time this morning, but we also appreciate their ability to view the clinical data and place it into a context of its ultimate objective, which is helping patients in real-world clinical practice. So, thank you. In closing, we are very well positioned. We are on track to resubmit our NexoBrit PLA by mid-year and continue to anticipate approval by the end of the year. We are preparing to meet with the FDA in the second half of this year to discuss SCAREC and gain clarity on paths towards approval. and we are welcoming Ofergonen to take the company to the next level of success. I look forward to continuing to support the company as a board member, and I'm certain we will enjoy a smooth transition. With that, I would like to turn the call to the operator to open the line for questions. Operator?

If you'd like to ask a question at this time, please press the star, then the number one key on your touchtone telephone. To withdraw your question, press the pound key. Again, that is star, then 1, if you'd like to ask a question. Our first question comes from Josh Jennings with Cowan.

Hi, this is Brian here for Josh. Thank you for taking my questions. I want to ask about the comment in today's press release about realizing the potential of your assets. Can you address your interest in looking for a partnership for either Escorax or Nexabraid outside the US? And I guess maybe more plainly, given the strength of the phase two data we've seen for Escorax, what's your commitment to independently completing the phase three program?

Good morning, goodbye, and thank you for the question. So as communicated previously, I think that now we are even better positioned for the next stage in terms of flexibility. We have the financial injection or the cash injection we had in the first quarter to strengthen our cash position. Now we have additional clinical data, very robust clinical data providing us with the ability to establish an improvement over all current non-surgical standard of care. This provides us to explore all alternatives. which are taking the product to the finish line by ourselves or exploring any other potential collaboration. It's premature now to discuss the alternative, but I can share with you as you really frame it. We have now the opportunity to explore all options, giving the robust data that we have on hand.

Thank you. Okay, thanks for that. And I guess on the next abridged BLA, you've outlined a timeline to approval that matches what you'd face in a typical Class 2 resubmission. So my question is, has the FDA definitively indicated that this is a Class 2 resubmission? And if so, can you discuss where you stand with factors such as the inspections and your readiness for a potential adcom panel, if that's requested?

Thanks. So, again, we remain on track for a mid-year resubmission for the NexoBREAD-BLA, and we anticipate a six-month review process. The six-month review process is by law. Usually, it takes either two to six months. But given the COVID and the backlog FDA has since the COVID, we know that it will take six months of review, and which position NexoBREAD for a potential approval by year-end and commercial launch in the beginning of 2023, the first half of 2023. We can speak on behalf of the FDA regarding the ability to get for pre-approval inspection in our facilities. That being said, we have been aware that the FDA inspected facilities outside the U.S., both in Europe and in Israel, and we are encouraged by that, looking forward to get the FDA response while we submit the FDA. As you know, within 30 months from resubmission, we will get the FDA. We expect to get the FDA acceptance and timeline for the review as well as for the potential pre-approval inspections. Thanks.

Okay, thank you.

Our next question comes from Kevin DeGieter with Oppenheimer.

Hey, thanks for taking our questions. And first, I want to thank Sharon for all this help and feedback for several years. And our questions, I don't know whether Dr. Dove is here for Q&A, but I guess we're primarily interested in better understanding how non-surgical debridement is used in VLU and DFU patients, specifically circumstances under which it's used as a standalone versus an adjunct to SHARP debridement.

Sure. Thank you very much for the question, Kevin. I can share with the audience that you were joining me in the last SAWC, the last conference, and we did see that usually the non-surgical means for debridement is used in conjunction with SHARP as a maintenance debridement, but this is what we know about the market. And let's leverage the fact that Dr. Dove is available and provide you with her perspective from her experience. So Dr. Dove, can you share your view with that point?

Yes, I can. So with the Eshgar-X, clinically, I did not, when we applied it as per the parameters of the trial, this was applied and there was no adjunctive sharp divide mints. even in patients who had fairly deep wounds for the diabetic foot ulcers. Traditionally, in my private practice, it is some type of enzymatic debridement, but almost always in conjunction with the sharp debridement. So the use of the HCRX, again, to reiterate, was very precise, much more precise than what I can replicate by a traditional sharp debridement with a 15 blade in my office. I hope that gives some clarification to you.

Thank you. And maybe building on that, I mean, based on, you know, the phase two data, you know, and I guess this is for the company or Dr. Dove, do you envision, you know, an evolution of standard of care potentially where escorex, you know, replaces the non-surgical debridement, but, you know, where most patients continue to to get surgical debridement, you know, and thus, you know, the non-surgical essential and adjunctive, you know, process? Or do you anticipate or envision, you know, essentially a reduction in the volume of stark debridement and more, you know, standalone non-surgical only debridement technique?

Thank you for that, Kevin. So I will start to provide you what we know about this and what we expect, and then Dr. Duff can add her perspective. Giving the feedback that we have, which comprises of a sale market research we conducted in the U.S. and in Europe, and giving the feedback we get just in the last conference in the U.S., the SAWC, we believe that even this efficacy of Escarex providing an effective and prompt debridement, clear debridement, preparing the wound beds for the next stage of healing, we believe Escarex can be positioned as a first-line therapy, taking not only replacing the current enzymatic standard of care, but rather take also chunks from the autolytic as well as from the sharp debridement. And this is exactly what the market research indicated and what we got as a feedback. And the best benchmark for that thing to the ones of us that have some history in the wound care industry is the papainorea. And papainorea was a mixture of proteolytic enzymes, a product by Hespon, that was dominant in the market and used as a first-line therapy because it was effective. And when I say effective, it debrided wounds in about two to three weeks. We are talking now based on the clinical data on the product that can provide a precise improvement in less than four applications, an average of four applications. And with that, I would like to turn the call to Dr. Tata to share her perspective. And please, Dr. Tata.

Yes. So as a principal investigator in the trial and as a physician who sees private practice patients, I think that there is nothing on the market like this product because it is standalone without surgical debridement. Because of the speed and the precision of ECHR-X, I think that this will become standard of care therapy on the market. And I think that for the large wound care centers and private practice physicians, this will be the first line therapy because it was incredibly effective at debriding and incredibly fast as well. for the patients who are treated with it. So, yes, this will become, in my opinion, it will become the standard of care first-line therapy.

Thanks for taking our questions. Thank you, Kevin.

As a reminder, if you'd like to ask a question at this time, that's star, then 1. Our next question comes from Arthur He with H.C. Wainwright.

Hey, good morning, everyone. This is Arthur in for Arcade. Thanks for taking my question. And congratulations on the robust data from the Phase II study. So my first question is for the doctors. So within the secondary and the exporter endpoint from the Phase II study, which endpoint is more, in your view, important in terms of medical perspective?

Thank you for your question. Thank you for your question, Arthur. I will turn the call to Professor Rosenberg to share his view and then to Dr. Taft to share her view regarding what is the meaning of the secondary endpoint in terms of wound bed preparation. Please, Dr. Rosenberg.

Wound bed preparation is really the first step and the necessary step for wound healing. And what we found it was that the granulation tissue was much more abundant and much more, shall we say, kicking and living than what we saw in the standard of care. The meaning of having such a granulation tissue is that one can really either heal the wound by grafting it, and this is an immediate closure, or healing it by spontaneous epithelialization will take a bit longer. But degradation tissue means that the wound bed is alive. And the model for wound care is what we call time. It stands for tissue inflammation, et cetera, et cetera. This means that we really kind of having the key to open the wound care to a much faster and much more efficient way of treating it.

Thank you, Professor Rosenberg. Dr. Duff, can you provide your follow-up?

Yes. You know, I would really build on what Dr. Rosenberg said. If you do not have a clean wound bed with healthy granulation tissue that is robust, you have nothing because the wound will never proceed past that inflammatory stage. You will never have a decrease in size. You will not have a decrease in pain. You will never have an improvement in quality of life. You have to have that initial healthy wound bed before you can even contemplate moving on to means of closure. So in my perspective, the primary endpoint of complete debridement and getting a healthy wound bed is the most vital endpoint that we have.

Thank you very much for that.

Thank you. Thank you very much for both. And a follow-up on that for Sharon and the team. So, I guess based on these robust data from the Phase II study, could you guys give us more commentary on the potential, the pivotal study design and the the potential costs related to that. Thank you.

Yes, thank you for your question. So, as I said before, first of all, it's premature yet to provide clear data on the next stage of development in terms of size, extent of the studies, number of studies, et cetera, given the fact that we did not yet discuss with the FDA. We expect to continue to analyze the data. As you know, we provide a robust data set, but we will continue to analyze the data, staff, population, and others to establish additional benefits of S-Correct compared to both gel vehicles and, of course, the standard of care. We also expect final data from the ongoing Phase II pharmacology study, which is conducted with BLU and DFU. where the initial data demonstrated, in addition to rapid debridement, also reduction in biofilm and microbial load. We want to gather all this information, integrate the data from the first phase 2 study from Europe and Israel, the current phase 2 study from the U.S., and the pharmacology phase 2 study, integrate the data, establish a plan for the next stage, and share it with the FDA. Once we get the FDA, once we have more clarity on that, of course, will communicate this plan with the street. Thank you.

Thank you. Thank you very much for the additional color. And thanks for taking my question.

I'm showing no further questions in queue at this time. I'd like to turn the call back to Sharon Malka for closing remarks.

Thank you very much. We look forward to updating you again on our next earning call. Have a great day. Thank you.

This concludes today's conference call. Thank you for participating. You may now disconnect.