SIGA Technologies Inc.

Welcome to CIGA business update call. Before we turn the call over to CIGA management, please note that any forward-looking statements made during this call are based on management's current expectations and observations and are subject to risks and uncertainties that could cause actual results to differ from the forward-looking statements. CIGA does not undertake any obligation to update publicly any forward-looking statement to reflect events or change circumstances after this call. For a discussion of factors that could cause results to differ, please see the company's filings with the Securities and Exchange Commission, including without limitation the company's annual report on Form 10-K. For the year ended December 31st, 2023, and its subsequent reports on Form 10Q and Form 8K.

With that, I will turn the call over to Zem Nguyen, Chief Executive Officer of CIGA. Zem.

Good afternoon, everyone, and thank you for joining today's call and the review of our business results for the second quarter of 2024. I am joined by Dan Lockshire, our Chief Financial Officer, and we appreciate this opportunity to provide an update on our company. After the update, we'll be happy to answer your questions. I am pleased to report that CECA has continued to generate product revenues that outpaced revenues in the comparable periods last year. Product revenues for the three and six months ended June 30, 2024, were $21 million and $45 million, respectively. This surpassed product revenues of $1 million and $7 million, respectively, for the periods in 2023. These strong results are reflective of CIGA's staying power. Our capital management activity over the past several years, including substantial special cash dividends, reflects and has been made possible by this strong long-term performance. Our focus on long-term performance is critical due to the nature of CIGA's business and the inherent quarter-over-quarter fluctuations. We believe the financial results for the first six months of 2024 supports an important positive long-term trend. Our sales reflects a diverse mix of oral TPOC deliveries to the U.S. Strategic National Stockpile, or SNS, the U.S. Department of Defense, and 11 international customers, as well as IV TPOC deliveries to the SNS. Looking ahead, we anticipate a continued diversification of our revenue base will be important for maximum long-term performance. Consistent with what we said last quarter, we expect 2024 to be another year of strong product revenues. As a reminder, our 2023 product revenues were the highest achieved over the past five years. Two weeks ago, the U.S. government exercised its procurement option under the 19C BARDA contract for the delivery of approximately 113 million of oral teapots. We plan to work with the U.S. government on the timing of delivery and currently anticipate deliveries will begin within the next 90 days. We foresee a meaningful portion of this order will be delivered before year-end, supporting our expectation that product revenues will again be substantial this year. It is our view that this award illustrates the U.S. government's belief that smallpox continues to be a threat. It also demonstrates its ongoing commitment to maintaining a robust stockpile of smallpox antivirals to help ensure the health security of American people, and an issue that has consistently garnered bipartisan support. TPOC has a strong safety profile based upon preclinical safety and toxicology data, phase three clinical data and healthy volunteers, as well as clinical observations. Over 1,500 MPOC patients have been enrolled in clinical trials to assess efficacy of TPOC for the treatment of MPOC, utilizing TPOX and its matching placebo provided by CIGA to trial sponsors at no cost. As a result, we anticipate it will be a preferred antiviral treatment in an event of an outbreak. Our attention is now firmly set on securing the next procurement contract with the U.S. government. Our team continues to be actively engaged with a broad range of government officials as we prepare for a request for proposal, or RFP, which can be issued by the administration of strategic preparedness and response at any time. While we wait for this next RFP, there are a number of factors that give us confidence. First, earlier this year, Congress approved the budget for the U.S. government, which includes another substantial increase in the federal budget for countermeasures, including the S&S. This funding outcome underscores the government's ongoing commitment to preparedness and response. Second, the current public health environment, including the Clade 1 Mpox outbreak in the Democratic Republic of Congo, or the DRC, highlights the heightened pandemic risk and continued need for nations to be response ready. This includes the timely procurement of effective therapies like TPOX. And third, we have a longstanding partnership with the U.S. government to provide a critical countermeasure against one of the world's most dangerous bio threats. As a reminder, Smallpox is one of only six diseases considered a category A threat by the CDC, and herd immunity is waning among our population. In fact, TPOX was among the first novel small molecule therapy delivered to the SNS under Project BioShield and was developed in collaboration with BARDA. All in all, based on our conversations with the government officials, as well as other SNS contracts to procure medical countermeasures, We are confident that the government is receptive to a new, long-dated contract, most likely between 5 and 10 years. And the aggregate value of this contract should surpass the aggregate value of our current contract, under which most options have now been exercised. As a frame of reference, the current 19C BARDA contract signed in 2018 has a procurement value of $546 million. This is an exciting time for CEGA. As I said earlier, the health and security of Americans is an issue that continues to garner bipartisan support. So while we wait for the receipt of this next RFP, we are keeping our focus on our longer-term goals. We have the financial strength to advance our business with current and potential customers outside the U.S. while remaining ready to collaborate with the U.S. government once it initiates the RFP process. Dan will provide further details on our financial position shortly. In summary, our balance sheet is robust with no debt, our cash flow remains strong, and we have exercised prudent cash management. This allows us to recently pay a special cash dividend in April. Moving on, we've also made progress in several other key areas. In April, we announced an amendment to our international promotion agreement with Meridian Medical Technologies. under which SIGA began driving promotional activities outside the U.S. for oral TPOCs starting June 1st. Since then, our team has strengthened relationships with key global customers, and we are confident these efforts will lead to growth over time. In June, we announced an agreement to sell TPOCs to the member states in the Association of Southeast Asian Nations. This agreement is a foundational step in a highly populated region for strong collaboration in the future. In Japan, we continue to have productive conversations with our partner, Japan Biotechnopharma, and regulators on the new drug application for TPOX for the treatment of smallpox, mpox, cowpox, and complications due to the Vicinia virus. Based upon the standard review timeline for the new drug application, we expect a final regulatory decision by early next year. If approved, we anticipate that TPOCs will be placed in national stockpiles ready for deployment in the event of an outbreak. We continue to pursue the expansion of TPOCs approvals and new indications such as PEP and MPOCs and formulations. First, on PEP, as I stated before, we believe that TPOCs has a potential benefit against smallpox and a post-exposure prophylaxis. Currently, much of our work has been focused in the completed TPOX, JYNNEOS safety and immunogenicity trial to evaluate TPOX when administered together with JYNNEOS. As a reminder, this trial was requested by the FDA because of the likely use of TPOX and JYNNEOS together in event of an outbreak. The trial was designed to test this drug vaccine combination to ensure there would be no impact to patient safety or vaccine immunogenicity. As a reminder, The data from the trial is supportive of the safety objective. Regarding immunogenicity, we are continuing to work with the CDC in consultation with the FDA to complete an analysis of samples collected to support the immunogenicity objective. At the same time, we are working out our supplemental NDA submission and targeting submitting it within the next 12 months. Turning to the ongoing MPOCS trial, the trial sponsors continue to make significant progress. POM 007 trial in the DRC has now completed enrollment. We anticipate release of top-line data in the coming weeks. The Di-AIDS stop trial has seen considerable growth with 515 patients enrolled as of July, up from 350 reported from our last call. MPOC remains a global threat, and particularly in the DRC where cases continue to rise. To support investigators and health agencies, in 2022, we donated over 500 courses of TPOC capsules and its corresponding placebo for the randomized clinical trial POM007. Recently, we donated another 100 courses to ensure patient access continues during data analysis. We're also working to support broader access programs in Africa. Additionally, the US government has distributed approximately 40,000 courses of TPOC in response to the 2022 MPOCS outbreak through the CDC's Compassionate Use Program. We continue to monitor the situation actively, providing assistance when possible to achieve the best possible outcomes for MPOCS patients. In summary, our company is strong, profitable, and well positioned for the future and supported by the following four pillars. Number one, we have a well crafted strategy that is yielding results. We have a prudent approach to capital management, which has afforded us the opportunity to pay significant special cash dividends. We have a valuable TPOC franchise that fulfills our critical requirement established by the U.S. government to ensure the country is prepared in the event of a natural, accidental, or intentional outbreak. And four, we have a resilient team with proven operational capabilities who are executing on our strategy with urgency and effectiveness. Combined, we believe these pillars will enhance shareholder value over time and improve public health. With that, I'll turn over to Dan to review the financial results in more detail.