Good day and welcome to the Savara conference call. At this time, all participants are in a listen-only mode. An audio webcast of this call will be available on the Investors section of Savara's Web site, at savarapharma.com. This call is subject to copyright and is the property of Savara. All recordings, reproduction, and transmission of this call without the expressed written consent of Savara is strictly prohibited. As a reminder, today's call is being recorded. I would now like to turn the call over to Anne Erickson, Head Investor Relations and Corporate Communications at Savara. Please go ahead, ma'am.

Good afternoon and thank you for joining us today. A press release reporting our first quarter 2020 financial results was issued earlier today, May 7, 2020, and can be found on the Investors section of our Web site, at savarapharma.com. If you've not received this release or you would like to be added to the company's distribution list, please e-mail me at ir@savarapharma.com. This call is also being webcast live, and one hour after the call a replay will be available on the company's Web site, and will remain available for the next 30 days. A telephone replay will be available through May 14. Today's conference call and webcast contain forward-looking statements within the meaning of federal securities laws, including statements regarding the company's strategy, goals, product candidates, clinical studies, and financing matters. Such statements are subject to significant risks and uncertainties, including those described in our press release issued today, Thursday, May 7, 2020, and our recent SEC filings on Forms 8-K, 10-K, and 10-Q. Actual results or performance may differ materially from the expectations indicated by our forward-looking statements due to those risks and uncertainties. We caution you not to place undue reliance on any of the forward-looking statements, which speak only as of today. We will take analysts' questions at the end of the call; however we encourage shareholders to submit questions via e-mail to ir@savarapharma.com. Time permitting; we will address these questions alongside any others that we've received today. Joining me on the call today are Rob Neville, Chief Executive Officer; Badrul Chowdhury, Chief Medical Officer; Dave Lowrance, Chief Financial Officer; and Taneli Jouhikainen, President and Chief Operating Officer. I'll now turn the call over to Rob.

Thank you, Anne, and thank you everybody for joining us on the call this afternoon, appreciate that. I wanted to start by saying that despite the widespread and far-reaching impact of COVID-19, we've enjoyed a strong start to the new year. This is a testament to the commitment and talent of my colleagues that has allowed us to navigate these unchartered waters with confidence and an eye on the future. While no one knows how long the uncertainty of the situation will last, Savara's Board and Management team alongside our employees remain focused on our mission, again to back up for COVID-19, our commitment to patients have never been more important, and that commitment is reflected in everything we do. With regarding our programs, we've marked a continued discussion with the FDA about IMPALA 2. We believe we now have a design for this confirmatory study, of which Badrul will share the details with you in a few minutes. We are grateful for the collaborative nature of our conversations with the agency, and are confident that we have aligned on a feasible study design that will successfully evaluate the efficacy and safety of Molgradex in aPAP. Additionally, we strengthened our pipeline in the new Phase 3 assets that gives us another short-term goal to grow and expand our business. We have always sought to develop new therapies that address unmet therapeutic need for orphan lung diseases, and now with the addition of Apulmiq to our late-stage pipeline, we have another opportunity to bring a drug candidate to market that could transform the standard of care for patients who have no other treatment options available. While nearly all companies have been impacted by the pandemic to some extent, we believe we can navigate the challenges we now face with two of…

Thank you, Rob, and hello everyone. It is nice to be speaking with you again. The direction for our lead program, Molgradex in aPAP remains clear. Our number one priority is to finalize plans for IMPALA 2. I am pleased to report that, following discussions with the FDA, we now have a good understanding of the IMPALA 2 study design. We expect it to be a 48-week double-blind placebo-controlled study with two arms, Molgradex 200 micrograms administered once daily compared to placebo. The lung function test of diffusing capacity for carbon monoxide or DLCO, which is a gas exchange measure that showed a nice separation between drug and placebo in the IMPALA study, will serve as the primary endpoint in IMPALA 2. The DLCO endpoint will be supported by three secondary endpoints that we believe measure direct patient benefit. Those endpoints are St. George's Respiratory Questionnaire or SGRQ, including the SGRQ total score and SGRQ activity component and exercise capacity using a treadmill test. SGRQ has three components, which are symptoms, activity and impact. SGRQ total score combines all three and was a key secondary endpoint in IMPALA that demonstrated a good effect. For IMPALA 2, we separated out SGRQ activity, as it is most applicable to aPAP and also worked well in IMPALA. While the efficacy endpoints will be assessed at week 24 for primary analysis, the duration of the study will be 48 weeks. The reason for this is because the 48 week placebo-controlled treatment will help us to better support the durability of treatment effect as well as long-term safety of the drug which is intended to be administered chronically. At a high level, this is the design of IMPALA 2. However, please be advised the final protocol is still being determined as you work through additional…

Thanks, Badrul, and hello everyone. I'll start by updating you on our cash position. As of March 31, 2020, we had cash, cash equivalents, and short-term investments of approximately $105 million, with approximately $25 million of debt. Under our current operating plan, including the anticipated second tranche of $46 million from our December financing, we believe we have sufficient capital to fund planned operations well into 2022. With respect to our quarterly results, Savara's net loss for the three months ended March 31, 2020, was $15.4 million or $0.27 per share, compared with a net loss of $12.1 million or $0.34 per share for the three months ended March 31, 2019. Research and development expenses were $13.2 million for the three months ended March 31, 2020, compared with $10 million for the three months ended March 31, 2019. The increase was due to $5.4 million related to the acquisition of the development and commercialization licensing rights to Apulmiq. This upfront license expense was partially offset by decreased development costs associated with Molgradex and AeroVanc in the amount of $1.7 million and $0.5 million respectively. General and administrative expenses for the three months ended March 31 2020 were $3 million, compared with $2.8 million for the three months ended March 31 2019. The increase was primarily due to non-cash stock based compensation charges, personnel costs, and corporate insurance costs. I'll conclude my remarks by reiterating that our cash position enables us to execute our strategy and deliver long-term growth. Now I'll hand the call back to Rob.

Thank you, Dave, and thank you to Badrul earlier. In summary, I wanted to leave you with just one thought and that is Savara is not defined by any one of our programs. Our focus is in gathering and strengthening the components required to become the orphan lung disease company, including the development of a diverse pipeline of drug candidates targeting multiple rare respiratory diseases. Well, I would love the drug development process to be far quicker than three late stage programs, we continue to see this vision take shape, and I'm more committed than ever to getting drugs to market and into the hands of patients. That is what 2020 and beyond would be all about operational excellence, ensuring we have the right processes in place to execute our strategy flawlessly. We do thank you all for your continued support, and I will ask the Operator to open the call for analysts' questions.

Thank you. We will now begin the question-and-answer session. [Operator Instructions] And our first question will come from Michael Higgins with Ladenburg. Please go ahead.

Good afternoon. This is Edward Marks on for Michael. I appreciate you guys taking the questions. Just two quick ones from me, wondering what the timing on the discussions with the FDA for the NCFB program as you're looking to initiate that trial?

Yes. Hello, this is Taneli. We will be expecting to do this discussion as a priority during this year, but given the fact that there may be several interactions, we cannot really give specific guidance as to when exactly we will be able to report clear outcomes.

Okay, thanks. And then looking at IMPALA 2, with the caveat that was provided in the prepared remarks about how the design isn't 100% solidified yet, I'm just wondering if you could talk about any changes, if any that are being made in this trial versus the first IMPALA trial?

Badrul, could you please go ahead with that?

Sure. There's couple of highlights I would like to point out. Broadly the trials are similar. The highlights of differences are the intermittent dosing, which was in IMPALA, which was not as robust, but the continuous dosing is being dropped. So, the IMPALA 2 will have two treatment arms: the continuous dosing and the placebo. The primary endpoint for IMPALA was a gradient, which is a gas exchange measure or IMPALA 2. The primary endpoint will be DLCO, which is also a gas exchange measure. The placebo-controlled treatment period for IMPALA was six months. For the IMPALA 2, the placebo-controlled treatment period will be 48 weeks. So, these are the high level differences. Thank you.

Thank you. That's all for me. I appreciate it.

I will now turn the call over to Anne Erickson. Please go ahead.

We've gotten a few questions in by email. So, I'll just read through the first one. First one is, will COVID-19 impacts the start of the IMPALA 2 start or the study conduct?

Well, it is really a little too early to know that right now, if things get back close to normal in the coming months, then probably not, but having said that, there is of course, the possibility of a second wave of coronavirus later in the year, which is why we really need to make our study as COVID-proof as we can. This would, for instance, include designing options that allow participation in the study with less frequent visits to hospitals or care providers, and assessment of endpoints accordingly as much as possible, and again, so, on this topic we will know much more as the planning progresses and hopefully have more clarity also on what to expect in terms of the pandemic progression as the year continues.

Thank you. Chuck, back to you.

Thank you. Our next question will come from Suji Jeong with Jefferies. Please go ahead.

Hi, thanks for taking my question. So, I have one question about the IMPALA study 2 -- IMPALA 2 study for aPAP. So is the trial design going to be different for E.U.? Have you guys had any discussions about the design with the EMA? Thank you.

Badrul. Conceptually, the trail design is unlikely to be different because IMPALA was same across the world, including EMA. As far as interaction with other regulatory bodies we will get back to you once we have those interactions and have firmed up the protocol. Thank you.

Great, thanks. Bye.

Our next question will come from Liisa Bayko with JMP Securities. Please go ahead.

Hi, thanks for taking the question. Can you maybe talk a little bit about patient selection and what kinds of patients you'll be honing on specifically for the PAP study? Thank you.

The patients will, in a broad sense, be similar to the IMPALA study. Meaning they would have to have a diagnosis of PAP, which is obviously, and this is autoimmune PAP, so they would also have to have the antibody to justify the autoimmune designation, and the primary endpoint being DLCO, we will look at enroll patients who are impaired on the DLCO so that they have got room for improvement. Those are the highlights which we can share right now. Thank you.

I will pass the call back to Anne Erickson for any additional questions.

Thank you. We've received two more over email. The first one is do you have enough cash to get through the IMPALA 2 study?

So there're still several open factors that are going to impact the size and the timelines of our study, that's going to include effects of the pandemic as well. So we're currently working to finalize our study protocol and all the practical arrangements, including CRO selection and CRO agreements. Once we have all those factors known we'll be able to have better estimates on the study by June timelines.

Okay, thanks. The next question that came in is, you mentioned on operational maturity efforts. Can you tell us specifically what you're talking about?

Yes, so what we mean with that is that successful execution of Phase 3 studies does require very robust and well defined internal processes, as well as topnotch external vendors to ensure that we get the highest possible quality in all of our study activities, as well as, of course, robust study oversight. While this is not anything new, as a focus in Savara we are putting a lot of effort now in implementing improvements to our operations, and also strengthening our resources in order to have the highest probability of success in our studies going forward.

Okay, thanks. I'm sorry, one more question came in, and it is around the Apulmiq program. Do you have enough capital to get through the Apulmiq Phase 3 study?

So just to -- let me start by saying that the first priority is the IMPALA 2 study, and our resources and cash are allocated to that program. Apulmiq, on the other hand, it's a bolt-on to Savara, and is not currently fully funded. We do have the necessary resources though to get through the initial activities, which are the negotiations with the FDA and all the prep work for ORBIT-5, as we expect calling it. However, prior to initiating that study we will then determine what resources are needed and how best to fund it.

Okay, thank you. That was the end of the questions that came in over email. So, this is the conclusion of the call. Thank you everybody for dialing in.

Thank you. Stay safe.

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