Good morning. And welcome to the Mast Therapeutics Corporate Update Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Ioana Hone, Head of Investor Relations at Mast Therapeutics. Please go ahead.

Thank you, Laura, and good morning. During this conference call, we will make forward-looking statements within the meaning of federal securities laws, in regard to our business strategy, expectations and plans, our objectives for future operations, and our future financial conditions. All statement other than statements of historical facts are forward-looking statements. Such statements may include words such as belief, could, would, will, plan, intend, and similar expressions. You are cautioned not to place undue reliance on forward-looking statements, which are only predictions and reflect our belief based on current information and speak only as of today, August 13, 2015. For a description of risk and uncertainties that could cause material differences between our actual results and those stated or implied by the forward-looking statements, please see our quarterly reports on Form 10-Q, filed with the Securities and Exchange Commission on August 12, 2015, which is available on our corporate website www.masttherapeutics.com and at www.sec.gov. With that, I would like to turn the call over to Brian Culley, Chief Executive Officer of Mast Therapeutics.

Thank you, Ioana, and good morning, everyone, and thank you for joining for today’s call. With me today is Brandi Roberts, our Chief Financial Officer; and on the phone is Ed Parsley, our Chief Medical Officer, who is actually on the road, evaluating sites for our heart failure study, but Ed will be available to answer questions at the conclusion of this call. I’ll begin with the most important item and that, of course, is the progress we have been making with our lead candidate, vepoloxamer in sickle cell disease. As you will recall, we are running a 388 patient pivotal Phase 3 study called EPIC to demonstrate that vepoloxamer can reduce the duration of vaso-occlusive crisis. We opened our first site in January of 2013 and are now actively enrolling at over 70 sites in more than 10 countries, with approximately two-thirds of those sites located in the U.S. We are pleased to report that our EPIC study is now more than 70% enrolled. This means that Mast has now enrolled more patients in an interventional sickle cell disease study than any other company and thanks to an incredible effort by our clinical operations team. I am pleased to reiterate for you today that we are on track to enroll the remaining patients in line with our guidance and report topline data from EPIC in the first quarter of 2016. An abundance of clinical and non-clinical data showing the vepoloxamer improves blood flow, which can be expected to shorten the length of crisis and reduce the amount of damage to vital organs, as well as patient demographic data we have reviewed from the EPIC study, gives us optimism for the outcome of our Phase 3 study. Thus, we have been working to enhance our EPIC data set and our…

Thank you, Brian. First, let me began by discussing our second quarter 2015 operating results. As of June 30, 2015, the company had cash, cash equivalents and investment securities totaling $43.4 million and stockholders' equity amounting to $42.5 million. Research and development expenses for the second quarter of 2015 were $7.7 million, an increase of $2.9 million, or 61%, compared to $4.8 million for the same period in 2014. This increase was due primarily to increases of $1.9 million in external nonclinical study fees and expenses, $0.8 million in external clinical study fees and expenses and $0.2 million in personnel expenses. Selling, general and administrative expenses of $2.4 million for the second quarter of 2015 were consistent with the same period in 2014. As Brain mentioned, this week, we entered into an agreement with Hercules Technology Growth Capital, under which we may borrow up to $15 million in two separate tranches. The company drew the first tranche of $5 million upon closing. The second tranche of up to $10 million is available this year at our discretion, provided that our vepoloxamer and AIR001 programs achieve certain clinical development milestones and we receive aggregate net cash proceeds of at least $15 million of upfront cash payments from one or more strategic corporate partnerships transactions and/or from one or more equity financings. We were able to also negotiate interest-only payments on borrows and bonds through June 1, 2016 and this period is extendable through March 1, 2017 if certain conditions are met. The company intends to use proceeds from the debt facility as additional funding for our developed programs and for general corporate purposes. Again, this is just straight debt with no conversion features. We strongly believe in vepoloxamer’s potential and are positioning ourselves for success. As a result, we expect to spend more capital on NDA preparation, the addition of new employees, commercial strategy and readiness initiative and other related activities that weren’t necessary earlier this year or last year. We anticipate the operating expenses for the second half of 2015, excluding share-based compensation expense will be approximately $18 million to $20 million. We expect our current cash position to take us through the announcement of EPIC data in Q1 and well into 2016. Let me turn the call back to Brian to disclose our corporate update.

Thanks, Brandi. Mast is proud to have identified and acquired vepoloxamer and soon we will be announcing data with it from the largest interventional sickle cell trial ever conducted. Since 2009, we’ve grown from just two executives to a team of 26 full-time employees who are preparing the business for clinical regulatory and commercial success. Mast is committed to bringing new treatments for patients suffering from severe diseases and we thank the patients’ families and caregivers for giving us this opportunity. I thank you also for joining the call today and for your interest and support of Mast Therapeutics. We are proud of our work and excited for the months ahead. We now would be pleased to take a few questions.

[Operator Instructions] And our first question comes from Yale Jen of Laidlaw.

Good morning. And glad for the progress you guys had made. My first question is that, in terms of the EPIC study, could you give us a little bit breakdown in terms of the adult and pediatric roughly at this moment?

Yale, one of the things that we have said is that, at our last update that the average age of patients in the EPIC study was 14. Currently, I think it’s crept up to as high as 15, essentially the same number. We don’t have a breakout for folks today in terms of the final number or the current number rather of people under 18 versus people over 18, but the average is obviously trending very young. And we don’t have any reason to think that there is going to be a meaningful change in that number between now and the end of the study.

Okay. Great. And for the renal impaired patient study that you just mentioned today, could you give us a little bit color in terms of its details and [what doubt] [ph] we also included in the filing package or that will be something subsequent to that?

So, one of the main reasons for conducting that study is of course to have appropriate guidance or instructions rather in our product label on how to utilize the product. So for example vepoloxamer could be accidentally overdosed. It is not known yet whether you could dialyze it off. Or if you have a patient who is in fact renally impaired, it would be good to know how to adjust dose. We like those instructions to exist in our package insert, and so that’s the reason for conducting that study. I will let Ed if he is able to here clearly jump in and comment on. I think Yale you asked about whether adults would be part of that study, is that correct?

No, I am trying to see, is this study going to start now or has already started, and would that be both in adult and pediatrics, and what kind of timelines that maybe completed the studies?

Okay. We intent to start seeing them and the purpose would be to have it available before to have that data in our NDA. And could you comment on what the patient profiles would look in that study, I believe it’s very conventional?

Yes. So this is a study that follows FDA guidance concerning special populations, thus it would be mostly an adult study likely in patients with multiple levels of renal impairment with the comparative placebo group.

Okay. Great. And the last question in terms of the stroke study, any additional color in terms of timeline or trial design were not at this stage? Thanks.

Certainly no specifics with respect to timeline yet or design but something that we will work through with those experts who we have met with. One thing I can say is that stroke is in the CNS division not in hematology. So we will need to submit an IND, so it’s not something that’s going to happen in next few months. In fact, we wouldn’t start -- we wouldn’t be in a position to start a clinical campaign even this year. So it maybe more likely than not that stroke would be something we would start in earnest after we see vepoloxamer’s data in EPIC. But meanwhile we can plan, prepare, file documents and otherwise be ready to have that option available to us.

Okay. Great. Thanks.

And our next question comes from Ted Tenthoff of Piper Jaffray.

Great. Thank you very much. So Brian, can you list the kind of support studies for EPIC again. There is a thorough QTC prolongation that you’ve done. There is the renally impaired and the repeat dose, is that [indiscernible] included as supplemental filing?

Yes. You listed them more correctly, the QT repeat dose in the special population. The approach we take conceptually is that we realized that there are strategies out there that some companies will employ where they rely heavily on unmet need to support their NDAs. We want to do whatever we can to make this application look like it’s not coming from an orphan drug. We want to supplement in any way possible and give the agency as much evidence and conviction that this is a treatment that’s well tolerated and provide the benefit to patients. So those three studies that I mentioned are separate studies. We also have a tissue oxygenation study, that’s baked within the existing 388 patient EPIC study and all of these are intended to layer conviction in place about vepoloxamer in these patients.

That’s really helpful. One quick for Brandi. Brandi, did you say that the brand would be around $18 million three year end, was that what I thought?

Yes, Ted. It was $18 million to $20 million for the second half of 2015.

Excellent. Well, thank you very much for the update. I think you guys are in a strongest position and then I am looking forward to the EPIC data next year.

Thank you.

The next question will come from Michael Higgins of Roth Capital Partners.

Good morning. Thanks. Hi, guys, how are you?

Thanks, Mike.

Good. A question on the aroma of EPIC, can you share with us the percent of kids or percent of patients rather coming in on hydroxyurea, any updates for us?

We know that information. We haven’t yet shared it. One of the things that we said at the outset was that because patients that participated in clinical trials generally have a greater level of concern or involvement in their care. We think that we’re going to see a higher rate than the population as a whole, but we haven’t said exactly what that is. So we think that out there and in the total population, hydroxyurea used is probably 20%, maybe 25%, we seen those kinds of reports. But we intend to do another update, a fulsome update before we announce our final topline data. And you can expect to learn more about patient demographics and some of our blinded data and we would include hydroxyurea percentages at that time because I do know it’s of interest to people.

Yes. I would agree that the higher rate based on these household thus for using and feedback from docs at those centers. Would you mind to you give us an update on EPIC prior to the topline results?

We haven’t determined. There are a lot of good round numbers. Certainly, the R&D day would make sense that we might do it there, but no final decision.

Okay. All right. Okay. Moving on to the stroke study, can you give us more details to the docs, the hospitals, who’s involved, where you got feedback from? What that trial may look like based on their discussions, not necessarily discussions you had with the FDA but just kind of some general outlook? Is this a 50 patient type study? Are you looking for grant funding? Also, were you having plans to list ALI data?

So with respect to the individuals we consult with, we would need to get their permission to share their names. We do have that permission from Michael Chopp and he did a lot of the work. He is one of the individuals who worked with. There are four, five others. These are names that maybe come available as the time goes forward. Sometimes you see individuals like this mentioned in press releases, et cetera, but the only reason I'm not unable to do it is we have not specifically ask for their permission to do so. With respect to the study designs, the only thing that I think that we would be comfortable being saying is that it’s more likely then not that it would be a Phase 2 proof-of-concept study. I think we have an abundance of data exposures and other information that would allow us to jump past Phase 1 study. It’s not a guarantee, right. We have not spoken to the FDA about this program. That would be an important first step. My expectation is that we would be able to go right into a Phase 2. The size of it though is just -- it is simply premature for me to speculate at this time. Obviously, that's going to be driven by assumptions around what vepoloxamer can do in the final design. But yes, we are interested in grants. There are a number of grants that are out there. Certainly, it’s always a competitive and difficult process, but we think we’ve got an exciting asset. One of the things that we heard was that this was an agent that enjoy -- as I described in sickle cell disease as well. It enjoys a number of different properties, each of which could be helpful in the setting of strokes. So, I do think we will be contenders by virtue of being a unique mechanism, compared to a lot of the approaches that have been tied. And then with respect to ALI, all of these studies as you know always start out slowly and then they really get rocking toward the end, because that study was not expected to conclude until the end of 2016. It was relatively early in enrollment. I don't think at this time we would expect to see anything that would be statistically significant or even much of a trend. Our focus would really with respect to data just beyond safety. So we will take a look at that data. I think it’s unlikely to find its way into a publication. It’s a relatively small number of patients and we don't really want to spend capital on the sort of QC and report writing on the study that doesn’t have meaningful utility for us anymore.

Yeah. Great. Okay. Thanks for the update on that. One other question on the really impaired study, as I’ve asked on the other studies that have come up, is this being initiated based on feedback conversations from doctors or anybody in the study or from the FDA or is this something like EPIC-E where along the way you said, no, this will help bolster our label?

Yeah. I can assure you this is 100% elective. We want that NDA to be a very high-quality. Our Vice President of Regulatory, who is new hire for this year came in. We evaluated the pros and cons of conducting the study, and thought, its going to be helpful. So it was not driven by FDA. It’s not driven by signal lot of EPIC. This is 100% elective on behalf of the company.

Okay. Great. Thanks for the update, guys. Congrats and I’ll jump back in the queue.

And this concludes our question-and-answer session. I would like to turn the conference back over to Brian Culley for any closing remarks.

Thank you, Operator. Thank you all again for joining us and please enjoy your days. We appreciate the opportunity share this update with you today.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.