Welcome to the Lisata Therapeutics Second Quarter 2025 Financial Results and Business Update Conference Call. [Operator Instructions] As a reminder, this call is being recorded today, Thursday, August 7, 2025. I will now turn the call over to John Menditto, Vice President of Investor Relations and Corporate Communications at Lisata. Please go ahead, sir.

Thank you, operator, and good afternoon, everyone. For those of you who have been on Lisata's calls previously, you'll recognize that this is not John Menditto speaking, but this is actually the President and Chief Executive Officer, David Mazzo. Unfortunately, John is having technical difficulties and hasn't been able to join the call. And some of the other speakers have also been having some issues today. So we apologize for any inconsistent sound, and we hope that you'll be able to hear the webcast at a later date. Joining me from the management team are Dr. Kristen Buck, the Executive Vice President of Research and Development and Chief Medical Officer; and James Nisco, Senior Vice President of Finance and Treasury and Chief Accounting Officer. Shortly before this call, we issued a press release announcing our second quarter 2025 financial results, which is available under the Investors & News section of the company website, along with a webcast replay of this call. If you have not received this news release, or if you would like to be added to the company's e-mail distribution list, please subscribe to e-mail alerts on the company website or e-mail John Menditto at jmenditto@lisata.com to be added. Before we begin, I will remind you that comments made by management during this conference call will contain forward-looking statements that involve risks and uncertainties regarding the operations and future results of Lisata. I encourage you to review the company's filings with the Securities and Exchange Commission, including, without limitation, its Forms 10-Q, 8-K and 10-K, which identify specific risk 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…

Thanks, Dave. Good afternoon, all. I'm pleased to join you today to present a summary of our second quarter 2025 financial results. Starting with revenue. For the 3 months ended June 30, 2025, revenue totaled $70,000 in connection with an upfront license fee related to a research license agreement with Catalent, Inc. We did not have any revenue for the 3 months ended June 30, 2024. Next, a review of our operating expenses. For the 3 months ended June 30, 2025, operating expenses totaled $4.9 million compared to $5.5 million for the 3 months ended June 30, 2024, representing a decrease of $0.6 million or 10.6%. Research and development expenses were approximately $2.3 million for the 3 months ended June 30, 2025, compared to $2.6 million for the 3 months ended June 30, 2024, representing a decrease of $0.3 million or 13.4%. This was primarily due to a reduction in patient treatment costs and clinical research organization expenses associated with our Phase IIa BOLSTER trial and lower spend on chemistry, manufacturing and controls. General and administrative expenses were approximately $2.7 million for the 3 months ended June 30, 2025, compared to $2.9 million for the 3 months ended June 30, 2024, representing a decrease of $0.2 million or 8.1%. This was primarily due to savings resulting from the elimination of an employee position and lower spend on consulting and travel and entertainment expenses. Overall, net losses were $4.7 million for the 3 months ended June 30, 2025, compared to $5 million for the 3 months ended June 30, 2024. It is noteworthy that we continue to make progress according to our plans for our R&D and business activities while continuing our legacy of prudent capital management and expense minimization. Turning now to our balance sheet and cash flow. As of June 30, 2025, we had cash, cash equivalents and marketable securities of approximately $22 million. Based on its existing and planned activities, the company believes available funds will support current operations into the fourth quarter of 2026. With that, I will now turn the call over to Dr. Kristen Buck to provide an overview of the company's development programs. Kristen?

Thank you, James, and good afternoon, everyone. It's a pleasure to be here today to present an update on our clinical development portfolio, including near-term catalysts. As mentioned on previous quarterly calls, Lisata is focused on the development of its proprietary, cyclic internalizing RGD peptide product candidate, certepetide, for the treatment of advanced solid tumors and other difficult-to-treat diseases. Certepetide is designed to activate a novel uptake pathway that allows co-administered or tethered anticancer drugs to selectively target and penetrate solid tumors more effectively. In addition, certepetide has been shown to modify the tumor microenvironment, making it less immunosuppressive and therefore, increasing the tumor susceptibility to immunotherapy and our body's own immune system while also inhibiting the metastatic cascade. If you'd like more information regarding certepetide's mechanism of action, we encourage you to visit our website where you'll find an animated video and relevant slides within our corporate presentation. On a regulatory front, certepetide has secured multiple special designations from both the FDA and EMA, all of which are listed on our website and in the corporate presentation for your easy reference. Now for an update on our individual development programs. The ASCEND trial is a Phase IIb 158-patient double-blind, randomized, placebo-controlled clinical trial evaluating certepetide in combination with standard-of-care gemcitabine and nab-paclitaxel chemotherapy in patients with metastatic pancreatic ductal adenocarcinoma, or mPDAC. The trial is being conducted at 25 sites in Australia and New Zealand and is sponsored by the Australasian Gastro-Intestinal Cancer Trial Group (sic) [ Australasian Gastro-Intestinal Trials Group ], or AGITG, in collaboration with the National Health and Medical Research Council Clinical Trial Centre at the University of Sydney. As I mentioned in the past, this investigator-initiated trial was inherited upon our acquisition of Ascend Therapeutics. The original trial was designed with an academic bent rather…

Thank you, Kristen. As we conclude, it's important to acknowledge that the excellence and dedication of our Lisata team remain the driving force behind our progress. Based on the positive clinical data that we have reported to date and the uniqueness of certepetide's mechanism of action, we continue to demonstrate the broad applicability of certepetide across a wide variety of advanced solid tumors and other difficult-to-treat indications, with the goal of ultimately transforming the cancer treatment paradigm while realizing certepetide's full value. And with that overview, operator, we are now ready to take questions.

[Operator Instructions] And for your first question, it comes from the line of Joe Pantginis from H.C. Wainwright.

This is Josh on for Joe. I just had a quick question about the ASCEND trial. So I was wondering if there's any additional insights you could provide us at this time on what this Phase III protocol may look like.

Well, at this stage, we've had already the end of Phase IIb meeting with FDA, and we have a tacit agreement on the structure of an open-label Phase III trial. We anticipate it to have somewhere on the order of 650 to 900 patients depending upon how many dosing arms we include. At this stage, we're contemplating including a continuous infusion dosing arm along with a 2 dose of certepetide dosing arm for comparison. But in the end, the exact design and size will be determined by statistics, which will power the trial at 90% and maintain a hazard ratio at 0.75.

And for your next question, it comes from the line of Will Hidell from Brookline Capital Markets.

A quick question about the spending. I noticed that it's gone down a bit. Do you expect spending to remain the same? I know you've extended the runway by a quarter. What's your expectations on that over the next year?

Well, it will depend on when we initiate the Phase III and also what the results of the BOLSTER trial indicate and then our plans to move the cholangiocarcinoma indications to later-stage development as well as the advancement of some of the other products that are now in preclinical evaluation. But if we were to make no other changes right now, then we would expect that you would see a modest decrease in spending over time as the ongoing clinical trials completely wrap up.

And for our next question, it comes from the line of Pete Enderlin from MAZ Partners.

You had been talking about cash through the second quarter of '26 and now you're extending that to the fourth quarter. And you just referred to lower expenses, but is it also possible that you are including in that projection any future license revenues or any other revenues like tax benefits or anything like that?

At this stage, the projections only include the anticipation of a very small final contribution of capital from the New Jersey sale of NOL program. Other than that, though, they do not contemplate any capital raises or any infusions. Of course, we'll be looking to do something probably later this year or early next year in order to fund future operations and future clinical trials. But the current projections do not include anything other than a small sale of New Jersey NOLs as part of the program next year.

Got it. And then Kristen just mentioned the recent 653 patent and the coverage extending through 2040. And you previously had talked more or less about pretty full broad coverage through 2030. So I'm wondering, what changed in terms of the latest patent versus what was covered in all the other patents kind of put together?

The latest patent just recognized some specific intellectual property around the actual composition of matter of certepetide itself. And the composition of matter patents, Pete, are fundamental patents that are the most difficult to work around. And so with the granting of that patent and the extension of that patent life out into the 2040s, we feel that the intellectual property portfolio is now really ultimately secured.

Great. And if I can venture one more, Dave, would you be willing to give some kind of a comment on the regulatory resistance of the FDA, which we all know about, versus what it's like in China. And that's, of course, relevant for the approval of the payment of a large sum once you get the first patient enrolled over there, when they get it. But I mean, in terms of time and difficulty and the amount of information that's required, can you compare the U.S. versus China in any way?

It's hard to do so, Pete, not being a Chinese company. Chinese companies have special relationships with their regulatory authorities, and there's a lot of politics that goes into that. So I really can't compare and contrast between the 2. All I will say is that the FDA has been very clear about their guidances for the development of cancer products, and we continue to work with them to find the most expeditious way to move our products forward.

And this concludes the question-and-answer session. I will now turn the call back to Dr. Mazzo for closing remarks.

Well, again, thank you all for participating in today's call. We remain grateful for your continued interest and support. Stay well, and have a good evening.

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