Greetings, ladies and gentlemen, and welcome to the Celcuity release of First Quarter 2021 financial results. It is now my pleasure to introduce your host, Mr. Robert Uhl with Westwicke Investor Relations. Thank you, sir. You may begin.

Thank you, operator. Good afternoon, everyone, and welcome to Celcuity's First Quarter 2021 Financial Results Webcast and Conference Call. Thank you for joining us. Earlier today, Celcuity released financial results for the first quarter ended March 31, 2021. The press release can be found on the Investors section of our website. Joining me on the call today are Brian Sullivan, Celcuity's Chief Executive Officer and Co-Founder; and Vicky Hahne, Chief Financial Officer. Before we begin, I would like to remind listeners that our comments today will include some forward-looking statements. These statements involve a number of risks and uncertainties, which are outlined in today's press release and in our reports and filings with the SEC. Actual events or results may differ materially from those projected in the forward-looking statements. Such forward-looking statements and their implications involve known and unknown risks, uncertainties, and other factors that may cause actual results or performance to differ materially from those projected. On this call, we will also refer to non-GAAP financial measures. These non-GAAP measures are used by management to make strategic decisions, forecast future results, and evaluate the company's current performance. Management believes the presentation of these non-GAAP financial measures is useful for investors' understanding and assessment of the company's ongoing core operations and prospects for the future. You can find the table reconciling the non-GAAP financial measures to GAAP measures in today's press release. With that, I'd like to turn the call over to Brian Sullivan, Celcuity's CEO.

Thank you, Robert. Good afternoon, everyone, and thank you for joining us today. As always, we appreciate your continued support of Celcuity. On this call, we'll update you on our first-quarter results and other business activities, focusing in particular on our strategic licensing agreement with Pfizer to develop and commercialize gedatolisib, recently reported encouraging clinical trial data for gedatolisib, and an update on our clinical trial collaborations. Vicky will follow up my comments with a discussion of our financial results, and then we'll open up the line for questions. We have had a few busy months recently. We entered into a worldwide exclusive license agreement with Pfizer to develop and commercialize gedatolisib, a first-in-class PI3K/mTOR inhibitor. We raised approximately $43 million in equity and debt. We signed clinical trial collaborations with Novartis, Pfizer, and Puma. And we presented compelling clinical and nonclinical data for gedatolisib. Obtaining the exclusive license for gedatolisib from Pfizer is a transformational strategic step for Celcuity. Taking on the responsibility for the clinical development of a targeted therapy builds off the research we've conducted over the past few years using our CELsignia platform. Our unique ability to assess the dynamic activity of signaling pathways in live patient tumor cells gives us proprietary insights into cancer drivers not available from molecular assessments. Our research to identify various breast cancer disease mechanisms led us to focus on one of the most complex pathways linked to breast cancer, PI3K/mTOR. Our findings reveal that many breast cancer tumors have dysregulated PI3K pathways despite lacking PI3K-alpha mutations. Our research also found evidence of the importance of inhibiting all Class I PI3K isoforms in patients with PI3K-alpha mutations. We subsequently evaluated various PI3K inhibitors using our CELsignia platform in live patient tumor cells and found that gedatolisib's unique mechanism of action was potentially ideally suited to inhibit PI3K/mTOR-involved signaling. Ultimately, our internal research findings and the clinical data Pfizer generated in a trial evaluating patients with ER-positive HER2-negative metastatic breast cancer motivated us to in-license gedatolisib. Under the terms of the licensing agreement, Pfizer granted Celcuity an exclusive worldwide license to develop and commercialize gedatolisib. Celcuity paid a license fee of $5 million cash and $5 million of Celcuity's common stock as upfront payments. Pfizer is also eligible to receive up to $330 million of back-end loaded development and sales-based milestone payments and to receive additional tiered royalties on potential sales. In early April, Celcuity also announced preliminary data for the 103 patients enrolled in the expansion portion of an ongoing Phase Ib clinical trial evaluating gedatolisib in combination with the CDK4/6 inhibitor Ibrance and an endocrine therapy. Preliminary analysis of the efficacy and safety data as of January 11, 2021, cutoff date found that 53 of the 88 evaluable patients or 60% had an objective response, and that 66 of the 88 evaluable patients or 75% had a clinical benefit. The safety analysis found that gedatolisib was also generally well tolerated with the majority of treatment-related adverse events, or TRAEs, being Grade 1 or Grade 2. The most common Grade 3 or Grade 4 TRAEs related to gedatolisib were stomatitis and rash. Gedatolisib was also found in the study to induce a far lower rate of Grade 3 or 4 hyperglycemia than other PI3K inhibitors that target the PI3K-alpha isoform. Among all patients enrolled in the Phase Ib trial, only 7% had Grade 3 or 4 hyperglycemia. This is in sharp contrast to alpelisib, a PI3K-alpha targeted therapy approved for breast cancer, where 39% of patients in a Phase III trial recorded Grade 3 or Grade 4 hyperglycemia. Our next step is to meet with the FDA to discuss our clinical development study plans for gedatolisib. Subject to the FDA’s feedback, we would then initiate a Phase II/III clinical trial evaluating gedatolisib in combination with palbociclib and an endocrine therapy in patients with ER-positive HER2-negative metastatic breast cancer in the first half of 2022. Additionally, in April, we presented the results of studies evaluating gedatolisib, inavolisib, a PI3K-alpha inhibitor, and navitoclax, a BCL inhibitor, in breast and ovarian patient tumors at the Annual Meeting of the American Association for Cancer Research. The results showed that inhibition of hyperactive PI3K/mTOR-involved signaling is 9x more effective with gedatolisib than with a PI3K-alpha inhibitor alone, such as inavolisib. Our data also showed the synergistic cooperation between PI3K/mTOR and BCL signaling was detectable, suggesting potential patient benefit of combining gedatolisib with a BCL inhibitor. These results supported our internal evaluation of gedatolisib and further reveal the potential advantage of inhibiting all PI3K isoforms and mTOR, not just PI3K-alpha signaling when treating PI3K-involved signaling tumors. We also made significant progress advancing the development of our CELsignia companion diagnostics. CELsignia is a third-generation diagnostic platform that identifies the underlying cellular activity and dysregulated pathway signaling in a patient's tumor so that a matching targeted therapy can be prescribed. Dysregulated signaling is too complex for molecular tests to characterize in most cases. This gives us a unique opportunity to help pharmaceutical companies obtain new indications for their targeted therapies to treat the patients our CELsignia tests are uniquely able to identify. To take the first step towards realizing this goal, we collaborate with pharmaceutical companies to evaluate the efficacy of their targeted therapies in patient populations selected by a CELsignia pathway activity test. If successful, these collaborations would represent a critical step towards obtaining a new indication that expands the market for the evaluated targeted therapies. We continue to believe there is a significant unmet need for new therapeutic options for HER2-negative breast cancer patients. Our research suggests that many of these patients have an undiagnosed and untreated disease mechanism. We believe that CELsignia can identify the disease mechanism for roughly 25% to 35% of these patients in the targeted therapy most likely to benefit them. Our efforts in this area are gaining momentum. In the first quarter, we entered 2 new clinical trial collaborations. In January, as we previously announced, we entered into a collaboration with the Sarah Cannon Research Institute with Pfizer for a Phase II trial. The trial will evaluate the efficacy and safety of 2 Pfizer-targeted therapies, Vizimpro, a pan-HER inhibitor, and Xalkori, a c-Met inhibitor, in patients with previously treated metastatic HER2-negative breast cancer selected with our CELsignia test. Patient enrollment is expected to begin in the third quarter of 2021 with interim results in the second half of 2022. In March, we entered into a clinical trial collaboration with MD Anderson, Novartis, and Puma Biotech to study a new drug regimen. The collaboration will evaluate the efficacy and safety of Novartis' targeted therapy Tabrecta and Puma's Nerlynx in patients with metastatic HER2-negative breast cancer selected by the CELsignia platform. This is our second clinical trial to treat patients diagnosed with hyperactive HER2 and c-Met signaling breast cancers with matching targeted therapies. We now have 5 clinical trial collaborations in place, and we are proud to have advanced and finalized these agreements despite the headwinds from COVID-19. Our ongoing FACT-1 and FACT-2 trials are evaluating anti-HER2 therapies in early-stage HER2-negative breast cancer patients. The goal of these trials is to demonstrate that breast cancer patients identified by our CELsignia HER2 pathway activity test obtain a higher rate of pathological complete response to new neoadjuvant anti-HER2 drug treatment than from current standard of care chemotherapies. Since patients who receive a pathological complete response to neoadjuvant drug treatment are less likely to have their cancer recur, we believe our CELsignia test can play a significant role in extending the lives of many breast cancer patients. We continue to expect interim results from our FACT-1 and FACT-2 trials in late 2021 or early 2022, barring any unforeseen additional COVID-19-related disruptions. We're excited about these collaborations and the opportunity to work with some of the world's most prominent cancer research centers. We have additional collaboration discussions in progress, and our goal is to announce new agreements in the coming quarters. We're also looking forward to having the opportunity to collaborate with the clinical investigators that will be conducting these new trials through our collaboration agreements. They're highly respected oncology thought leaders and researchers, and we believe their interest in collaborating with us reflects their respect for the unique potential our CELsignia test offers to identify undiagnosed disease drivers in their patients. And finally, we recently closed 2 financings that resulted in gross proceeds of approximately $43 million. This key financing strengthened our cash position and will allow us to fund key clinical development initiatives. Vicky will describe the financing in more detail in her remarks. So Vicky, I'd like to turn now to you to review our financial results.

Thank you, Brian. Our first quarter net loss was $2.79 million or $0.25 per share compared to a $2.25 million net loss or $0.22 per share for the first quarter of 2020. Because these quarterly net losses include a significant noncash item, which is stock-based compensation, we also included in our press release a non-GAAP adjusted net loss for the quarter. Our non-GAAP adjusted net loss was $2.34 million or $0.21 per share for the first quarter of 2021 compared to a non-GAAP adjusted net loss of $1.78 million or $0.17 per share for the first quarter of 2020. R&D expenses increased by approximately $0.39 million during the first quarter of 2021 compared to the first quarter of 2020 due to a $0.06 million increase in compensation expense. In addition to that, other research and development expenses increased by $0.33 million due to clinical validation and laboratory studies and operational and business development activities. The approximate $0.09 million increase in G&A during the first quarter of 2021 compared to the first quarter of 2020 was primarily due to a $0.08 million increase in professional fees associated with being a public company and director and officer insurance. We ended the quarter with approximately $34.9 million of cash and cash equivalents. This includes the proceeds from a successful follow-on offering of nearly 2 million shares of common stock that raised gross proceeds of approximately $27.6 million. The net cash used in operating activities for the first quarter of 2021 was $2.52 million. This was a result of a non-GAAP adjusted net loss of $2.34 million and $0.28 million of working capital changes in prepaid assets and accrued expenses, offset by depreciation expense of $0.1 million. In April, we entered into a debt financing agreement with Innovatus Life Sciences Lending Fund I to provide up to $25 million in term loans with the first $15 million tranche funded at closing. We will be able to draw on 2 additional tranches of $5 million each upon the achievement of certain clinical trial and financing milestones. This coincided with the payment of an upfront license fee of $5 million in conjunction with the Pfizer gedatolisib license agreement. Taking into account these 2 events subsequent to the end of the first quarter, we had approximately $44 million of cash on hand. And with that, I'll turn it back to Brian.

Thank you, Vicky. So I'd like to just wrap up before we take questions. We're very excited about the progress we made over the past few months. The license of gedatolisib creates a fantastic potential opportunity to create value for our shareholders. And we're looking forward to updating you as we advance the program, and we also expect to close additional collaborations utilizing the CELsignia platform in the coming quarters. Operator, I'd like to now open up the call for questions.

Our first question comes from Alex Nowak with Craig-Hallum Capital Group.

Brian, to actually pick up on that point that you just mentioned at the end there. So regarding the additional clinical trial collaborations that you would expect to announce later this year, can you just give any hints on what to expect there? Would you expect these trials or these collaborations to be again within earlier late-stage breast cancer? Or would these be the first deals that move into a different cancer type?

We just haven't commented on what we expect really until we kind of are ready to announce the collaboration itself. But we're on track to announce a couple more as we indicated.

Okay. That's great. Understood. And then maybe just an update on all the trials. How is enrollment tracking with the FACT-1 and 2? It sounds like things are going pretty much in line with your expectations as the world starts to reopen here? And then where are you with beginning enrollment on the FACT-3, 4 and 5? Is the trial sites getting set up now? Is that the stage that you're currently in? Just any update there.

Sure. The FACT-1 and 2 trials are proceeding as we previously outlined. FACT-4, which we announced in December, is progressing more slowly and is preparing to activate. We anticipate this will occur in the current quarter. FACT-3 and FACT-5, announced in January and March respectively, are on schedule for activation in the third quarter. All these studies need to receive final approval or be reviewed by the scientific committee, along with the filing of INDs or IND documentation with the FDA. Everything is unfolding as we had anticipated.

That's great. Just going back to the commentary in the press release today, your prepared remarks, and then just going back to my notes a couple of weeks ago on the gedatolisib call, it looks like you now expect the next stage to be a Phase II and III pivotal. And originally, I thought it was just going to be a Phase II. So just curious if the thinking there on the clinical trial need changed in the past couple of weeks?

I believe we have always referred to this as a Phase II and III trial, and the meaning of a Phase III trial is that it is crucial. I've been using that term interchangeably with the intent I described earlier. However, we feel that the next step is to receive feedback from the FDA. This feedback will assist us in finalizing the trial design, and we believe there is a possibility of positioning this study as a pivotal registrational study.

That's great. And then since the announcement a couple of weeks ago and then going forward here, have you gotten any more inbounds from pharma regarding about in-licensing other drugs? And then I guess a little bit of a follow-up to that question is on the alternate side. Is pharma reaching out to you realizing what the potential to CELsignia has? And clearly, you are bringing a drug in internally, so you clearly believe that. So is that drawing any more attention from pharma wanting to do collaboration?

I'll ensure you receive the business development minutes from our meetings, Alex. We're focused on preparing for the FDA meeting, and there's a significant amount of work involved in transitioning gedatolisib from Pfizer to us. This process entails multiple components and is progressing well. Our primary focus right now is to establish the groundwork for the next study for gedatolisib, while also considering other potential indications that we could uniquely explore. Collaborations with other pharmaceutical companies could be part of this strategy. However, as everyone is aware, such collaborations can take time to explore and finalize. We have historically not provided too much detail on these discussions until we have something concrete to share, and we plan to continue that approach moving forward.

Understood. That makes sense. And then just last question. Just any update on when you plan to publish the results from the Phase Ib in a journal or abstract?

Sure. Our goal, our intent, at least, is to be able to present the data at the San Antonio Breast Cancer Symposium in December this year.

Our next question comes from the line of Yi Chen with H.C. Wainwright.

This is Boobalan dialing in for Yi Chen. Just real quick. How do you expect the R&D cost to evolve for the remainder of the year?

We've provided guidance on our diagnostic-related expenses. We indicated that our net cash consumption would be approximately $2.5 million to $3 million in that area, and that the therapeutic side of the business would increase over the next three quarters to about $4 million in expenses by around the first quarter.

Understood. What are your expectations from the upcoming Phase II HER2-negative breast cancer trial with Sarah Cannon and Pfizer? And when do you expect to complete the enrollment process? And I'm curious why there is an extended period for the data readouts.

Well, it's a late-stage trial and the enrollment for trials like that, especially in a third line setting. These are patients who failed a couple of lines of therapy can take a significant period of time. I think we're trying to be conservative when we think these patients could be enrolled. And certainly, if it happens faster, we would announce the results in line with that.

Our next question comes from Matt Phipps with William Blair.

Just I guess a little bit of a follow-up and to clarify wording. Do you envision a pivotal Phase II trial or a Phase II that has a transition to a Phase III after maybe some interim like safety run-in or kind of ORR or something like that?

Yes. Those are the types of questions that we'll be discussing with the FDA. And so I'm wanting to communicate that we will be exploring different options with the FDA that could include a pivotal study, but we want to get that feedback and understand kind of what the design implications would be. But we think it makes sense to consider a pivotal study, but we want to make sure we get the appropriate feedback before we commit to any particular design or approach.

Okay. Yes, that makes sense. And then I guess as far as timing for some of those additional indications, you guys showed some treatment data with the HER2 biosimilar. You mentioned the endometrial trial. Does that kind of just come after you get this? I mean you've got enough on your plate getting the pivotal trial kicked off. And then maybe after that, we hear about some of the other opportunities?

I believe it's important to manage the transition smoothly and establish a solid foundation for the study while also beginning to analyze the existing data related to gedatolisib and other PI3K inhibitors. We have noted that gedatolisib has a distinctive mechanism that may be particularly effective for diseases associated with endocrine pathways. There is a compelling indication of a connection between the estrogen or endocrine pathway and CDK4/6 in breast cancer alongside PI3K/mTOR. Additionally, the literature suggests the involvement of the PI3K/mTOR pathway in other cancers driven by endocrine factors. Therefore, these types of tumors are areas we intend to explore further internally and integrate into our analysis as we continue our future development plans.

Ladies and gentlemen, at this time, there are no further questions. I would like to turn the floor back to Brian Sullivan for closing comments.

Well, everyone, thank you for participating in our call. If you have additional questions, I'm happy to chat with you. I hope you have a good evening. Goodbye.

Thank you. Ladies and gentlemen, this concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.