Good morning, ladies and gentlemen, and welcome to the Palatin Technologies Third Quarter Fiscal Year 2016 Conference Call. As a reminder this conference is being recorded. Before we begin our remarks, I would like to remind you that statements made by Palatin that are not historical facts may be forward-looking statements. These statements are based on assumptions that may or may not prove to be accurate and actual results could differ materially from those anticipated due to a variety of risks and uncertainties discussed in the company’s most recent filings with the Securities and Exchange Commission. Please consider such risks and uncertainties carefully in evaluating these forward-looking statements and Palatin’s prospects. Now, I’d like to introduce you to your host for today Dr. Carl Spana, President and Chief Executive Officer of Palatin Technologies. Please go ahead sir.

Thank you and good morning. I’m Carl Spana, the President and Chief Executive Officer of Palatin Technologies. With me on the call today is Steve Wills, our Chief Financial and Operating Officer and Executive Vice President. On today’s call, we will provide updates on our development programs and our third quarter fiscal year 2016 financial results. To begin, Steve will provide the financial updates. Steve?

Thank you, Carl. Good morning everyone. Starting with the quarter ended March 31, 2016 and recent highlights. Regarding our bremelanotide development program for female sexual dysfunction/FSD, we completed patient enrollment in our Phase 3 reconnect study with bremelanotide for FSD, and we are progressing as planned and meeting our target objectives for both the clinical and non-clinical areas. Last patient out is expected in the third quarter of calendar year 2016 and top line results are expected to be released late third quarter of calendar 2016. Carl, will give you more detail on the program during his part of the presentation. Regarding our intellectual property portfolio, the United States Patent and Trademark Office has issued a Notice of Allowance on a patent, which claims for methods of treating female sexual dysfunction using the formulation and dose used in our ongoing Phase 3 reconnect study with bremelanotide. This is the same formulation and dose we will use for commercialization upon FDA approval. We anticipate that the patent will issue later this month and will have a term through at least November 2033. Regarding financial results, we reported a net loss of $12.7 million, or $0.08 per basic and diluted share, for the quarter ended March 31, 2016, compared to a net loss of $9.2 million, or $0.07 per basic and diluted share for the same period in 2015. The increase in net loss for the quarter ended March 31, 2016 compared to the quarter ended March 31, 2015 was primarily attributable to the increase in expenses relating to our Phase 3 reconnect study with bremelanotide for FSD. Regarding revenue, there were no revenues recorded in the quarters ended March 31, 2016 and 2015. Regarding operating expenses, operating expenses for the quarter ended March 31, 2016 were $12.1 million compared to $8.7 million for the comparable quarter of 2015. The increase in operating expenses for the quarter ended March 31, 2016 was a result of increase in expenses, primarily related to our Phase 3 reconnect study with bremelanotide for FSD. Regarding other income and expenses, total other expenses net was $0.6 million for the quarter ended March 31, 2016 consisting primarily of interest expense related to the venture debt compared to $0.4 million for the quarter ended March 31, 2015. Regarding Palatin’s cash position, our cash, cash equivalents and investments were $23.1 million as of March 31, 2016 compared to cash and cash equivalents of $27.3 million at June 30, 2015. Current liabilities were $13.1 million as of March 31, 2016 compared to $7.4 million as of June 30, 2015. We believe that our existing capital resources will be adequate to fund planned operations through the quarter ending September 30, 2016. Assuming our Phase 3 reconnect study with bremelanotide for FSD is successful, as to which there can be no assurance, we will need additional funding to complete submission of required regulatory applications to the FDA for bremelanotide for female sexual dysfunction. Carl?

Thank you, Steve. Our third quarter fiscal year 2016 operational update will focus on our bremelanotide Phase 3 female sexual dysfunction program. Bremelanotide Phase 3 reconnect study protocols 301 and 302 are multi-centered, double-blind, randomized, placebo-controlled clinical studies with a six-month randomized treatment phase and open label safety extension phase. The clinical trials are designed to randomize 1,100 women with approximately 550 in each of the trials to evaluate the efficacy and safety of subcutaneous bremelanotide in premenopausal women with hypoactive sexual desire disorder as an on-demand, as-needed treatment. Bremelanotide reconnect studies are progressing on schedule. We are now fully enrolled in both Phase 3 reconnect studies. As we have previously stated, this puts us on track to have topline data by late third quarter of calendar 2016. If the data is positive, we plan to file a New Drug Application with the FDA in the first half of calendar 2017. In addition, the open label extension study has a target enrollment of 600 patients, currently over 400 patients on roll and approximately 85% of the patients completing trials 301 and 302 are continuing in the open label safety study and the study is on track to meet our timelines or a New Drug Application submission. Over the past year, the female sexual dysfunction fields has had major positive changes with the approval and launch of Addyi, the first FDA approved treatment for women suffering with female sexual dysfunction. The Addyi label contains contraindications for the use of alcohol and drugs that are moderate or strong cytochrome P450 inhibitors. In addition, the Addyi label has a risk evaluation and mitigation program that requires both physicians and pharmacist certifications and patient counseling concerning the risk of using Addyi and drinking alcohol. We believe that bremelanotide, if approved will play a major…

Thank you. [Operator Instructions] We will go ahead with our first question from Kumar Raja of Noble Life Science Partners. Please go ahead.

Hi, congratulations on all the progress. I had a question about alcohol interaction study. So like you presented data like couple of months back in 24 subjects, how do you expect it to correlate with the real life population and also in the Phase 3 trials are you tracking like in terms of alcohol like whether these women consuming alcohol and how do you expect it to impact the label compared to Addyi?

Well, the alcohol interaction study is conducted so that the exposure to alcohol, these patients were given about 6 ounces of alcohol and the peak exposure to bremelanotide overlap and then you are looking to see the symptomatology of either one is affected. So it's pretty real life with regards to making sure that, yeah, peak exposure to drug while you have a lot of alcohol in your system. So we think that it’s a good study, very standard type of study with standard design and the results are strong and clearly indicate as we would have anticipated that there is not an interaction between bremelanotide and alcohol. In the two Phase 3s obviously this can be concern, so we are tracking carefully. We are asking the women if they are drinking alcohol, how much they are drinking, so we're trying to collect as much information as part of the Phase 3 so that we will be able to clearly know and state that these women were indeed drinking and using - and taking the drug. So I think overall with regards to the alcohol, potential for alcohol interaction, I think there - it really isn't one with regards to bremelanotide and I don't expect that there would be one on the label.

Okay, great. I had one more question on licensing and partnership. So, following the Phase 3 data, how soon can this be done potentially?

This is Steve, I’ll take this one, the way we have approached the potential collaboration process it’s been somewhat ongoing. We have discussions on a contemporaneous basis and we’re prepared to depending on several factors to move the program regarding the collaboration very quickly if we think that makes sense. So there is no question the data that comes out late third quarter is going to be the primary drier of those collaboration chats but we are not going to be starting the process at an early we're at definitely an advanced stages of discussions and due diligence with a number of potential collaboration partners.

And the next question will come from Joe Pantginis from Roth Capital Partners. Please go ahead.

Couple of follow-up questions on BMT and then one on 3994 if you don't mind. Carl you mentioned and Steve in the past about the work you've been doing on pricing and reimbursement, do you think you can share any of your initial findings and also based on the missteps that Addyi has had, I would hope that you are sensitive to pricing based on the backlash towards Valeant on that?

This is Steve, Carl will jump in some color but the - let's start with the pricing, yes we are very cognizant and sensitive to some of the backlash related to not just INT, some other - to some other companies out there regarding pricing. And it’s all public information, the Valeant for their Addyi product have come as of right now with a price in that $700 to $800 per month range. Based on the work we have done prior and the work that we continue to do, our pricing target will be less than that. For certain confidential reasons, we are not going to disclose how much less but we've done this let’s just call it a pricing elasticity analysis and study in conjunction with reimbursement. We’re comfortable that the majority of the plans we believe will reimburse the product we're comfortable that its stage or status will be tier-3 which is actually very similar to erectile dysfunction drugs. And again, just at this point we can’t go over the granular but we’re comfortable that the pricing and the reimbursement will be something that’s in line with what the consumer is looking for, the HCPs and definitely that we are going to stay away from potentially having to be go down to DC and talk about our pricing practices.

And then not to belabor the whole partnership concept for BMT but have these discussions been hampered in any way by what has been going on with Addyi?

When you say hampered, there is no question the launch of the Addyi product is from a number of standpoint is much less than what was anticipated. Does that question the potential market size, the short answer is yes, the longer answer is probably heard Carl said no but what I was going to say is, you have to look at what is being sold there, the product is a restrictive product, there are some challenges for the marketplace regarding getting the scripts and the consumers . We are comfortable with a number of differentiating factors of our Bremelanotide versus Addyi. We think there is a place for both products, for both treatments multiple users or multiple availability of treatments we think is a good thing but to be transparent there has been some discussion around the market size because of that launch. The most significant item for the approval was the approval, so now that you have in the US the first FDA approved treatment for female sex dysfunction that was extremely significant for our program the potential collaboration partners we feel and most importantly to the female population that’s distressed and suffering from this condition. But we feel confident that when you spend the time you go through the different products that there is enough differentiation factors that the market size or potential market size will not be as significant an issue. I think Karl, I know we’ve had some internal discussions where that Addyi is doing some internal retrenching and it’s our best intelligence that they will be doing somewhat of a relaunch whether it's later in the second half of the year but our hope is that it will be a more positive launch from a marketing standpoint.

And then my sort of broader question around 3994 and I guess using the same sort of language for Addyi, the relatively slow launch of ENTRESTO, has that impacted any of your plans with regard to trial designs or type of the studies you might want to go into?

No, not at all, ENTRESTO is a good product, a solid product, I think Novartis will grow that product nicely, and may have been a little bit unreasonable to assume that they were going to change cardiovascular practice overnight even with the solid product with good solid Phase 3 data. One of issues with ENTRESTO is they are really looking to take the patient of an ACE inhibitor and put them on their treatment and that's a big switch to get cardiologist to do and that’s going to take a fair amount of time to do a bit. But even in light of that the product is in you know it may not have taken off as large as they wanted but it’s still a nice product growing very well. And I think that product will be a multibillion-dollar product, it may just take a little bit longer than may have been anticipated along those you know from a variety of analysts as well as the company itself. For us, we're really, I think this field is just is an amazingly - going to be an amazing fruitful field for novel treatments and for heart failure and I think we find ourselves in a very strong position. What's interesting from a partnering standpoint is, there is a lot of initial interest, I think, a lot of large pharma are all getting back and thinking about heart failure, how they put it in to context. It’s going to take some time for them to figure out, where they want to re-put their footprints, how do they want to be involved back in heart failure and reestablish programs and that's taking some time, but we are getting a lot of very good strong initial interest. People are looking at the program and then what we're seeing is it’s going to take some time for that to translate into a potential licensing deal. But we are optimistic as we move that program forward that that will be eventually what does happen.

Thank you very much, guys.

And your next question will come from John Newman of Canaccord Genuity. Please go ahead.

Hi, guys. Thanks for taking the question. I just wondered -- I had two questions The first one was, given that bremelanotide will be administered via an auto-injector device assuming FDA approval, do you think that that raises the bar for any potential generic competitor long term, just because it seems like that the agency has been reluctant to improve generics with auto-injectors. And the second question that I have is, there has been questions on the call already, and there has been a lot of discussions about Addyi in the market, can you just remind us again why you think on a very basic level the different mechanisms of action here are likely to not just produce a different clinical result, but just be more attractive to physicians. I mean we know what type of medicine Addyi is, but I just wondered if we could just get your views on that, just that mechanism seems like it’s an awful lot of time. Thanks.

Yeah. John, I’ll do in a reverse order. I’ll start with the second. As we’re saying, Addyi is a serotonergic agent, it requires chronic administration in about 8 to 12 week lag period before the patient receives or begins to get efficacy. Bremelanotide is very different, bremelanotide is an on demand medication, it’s taken in the concept of a sexual context. Patients will receive benefit from the drug if they’re going to have it immediately first dose, there is no lag period. It’s very convenient for the patient to use, even though it’s an injectable, the device we use is, as many of you know, it’s a very simple auto-injector, you press it against your leg, it takes a few seconds, the drug is delivered and it’s very convenient for the patient. They’re not worried they’ve to take something every single night. A lot of patients don’t want to do that. What they’re looking for is a treatment that’s specific for their condition, which is when they want to have a sexual encounter, or when their intersexual context, they want to be able to access a treatment that’s going to help them to feel more normal and in case in a more normal sexual activity. That is in line with the way the mechanism works. What we’re doing is we’re activating regions in the hypothalamus that are involved in a normal sexual response and we’re helping to really re-establish that responsive arousal and desire that should occur when a subject or a person is beginning to engage in a sexual encounter, when they’re thinking about it, when they’re being stimulated, when they’re being approached by their partner and so we’re helping to reconnect those types of processes with a more natural response that the patient doesn’t have. So patients tend to like that, because they’re really taking the treatment when they need it, they’re feeling much more normal, they can reengage in a normal sexual encounter with their partner and have that responsive arousal and desire that’s been lacking or they haven’t been able to have. That of course as you might imagine feeds over into a more longer-term viewpoint of how they view their sexual life when they’re no longer concerned about engaging encounters with their partner, because they have a more normal natural response. The view point of their sexual life improves as well and as you might expect, that’s a very big positive for them as well. So even though the drug is taken intermittently, it does have a very pronounced effect on the patient’s overall global impression of how their sexual health is improving. And Steve I think will talk about the generic device.

Hi, John. It’s Steve here. Yes, I agree with you that the barrier for potential generic coming in with an auto injector is greater from the FDA perspective, there is no question you would have to go through a reasonably comprehensive bio-equivalent study, but in addition to the FDA for the regulatory approach, we had the IP that based on what we mentioned today, we think the IP, we’re in a good position, we’re going out to 2033 now, which is a very significant positive. But in addition to the IP and the potential bio-equivalents that studies you have to go through with the FDA, there's also the supply factor. There is only two or three companies that really make these auto-injectors at any type of scale and I will tell you that we've gone through several years of development and very significant CapEx to get to this point. The group we’re with, which we've publicly disclosed is Ypsomed. There is no way a generic can come in and use that device from Ypsomed and even if you went with one of the other competitors, again, what you would have to go to from a time standpoint and CapEx is just very, very significant and we think that’s even an added barrier. It’s not like a pill, where it’s just a lot more readily available to produce the product from a generic standpoint.

Thanks. Great, thank you.

It appears that there are no further questions at this time. I’d like to turn the conference back over to you, Dr. Spana, for any additional or closing remarks.

Thank you for the great questions. We appreciate everyone’s time and interest in the company and for participating in our calendar 2016 third quarter financial update. Look, obviously, next couple of quarters are big ones for us and we're quite excited here. The trial is moving -- Phase 3 is moving quite nicely as we’ve stated and we’ve got a lot of enthusiasm and excitement in the company. And it’s a good time to be here. So we look forward to continue to update you. Have a great day and thank you for participating on the call.

This concludes today's call. Thank you for your participation. You may now disconnect your lines and have a wonderful day.