Good day, ladies and gentlemen, and welcome to the Retrophin Q2 2014 Financial Results Conference Call. (Operator instructions.) As a reminder, this conference call is being recorded. I would now like to turn the conference over to Marc Panoff, Chief Financial Officer. Please begin.

Thank you. Good morning, everyone. Thank you for participating in today’s call. Before we begin I would like to caution that comments made during this conference call by management will contain forward-looking statements that involve risks and uncertainties regarding the operations and future results of Retrophin. I encourage you to review the company’s filings with the Securities and Exchange Commission which identify specific risk factors that may cause actual results or events to materially differ from those described in the forward-looking statements. The contents of this conference call contains time-sensitive information that is accurate only as of today’s date, August 12, 2014. The company undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call. With that I will turn the call over to Martin Shkreli, Chief Executive Officer of Retrophin.

Thank you, Marc. Good morning, everyone, and welcome to the Retrophin Q2 2014 Earnings Call. I’m also being joined on the phone by Stephen Aselage, President and Chief Operations Officer, and Dr. Alvin Shih, Executive Vice President and Global Head of R&D. Q2 marked the continuing transformation of Retrophin from a biotech startup to a global, fully integrated pharmaceutical company. We recorded our first full quarter of revenue and made substantial progress in our pipeline. We added key executives to our senior management team who will work with me to lead and grow Retrophin for years to come. We’re excited to continue blossoming into a larger organization by allocating our shareholders’ capital into the highest-returning pharmaceutical projects irrespective of modality. Retrophin was built from a financial perspective and continues to operate through this lens. However, we take a broad approach to financial allocation. Most “shareholder-friendly” pharmaceutical companies remove R&D from their focus. We wholly embrace R&D as one of the best ways to deliver financial results to our shareholders and also deliver on our mission statement of advancing innovative treatments for rare, devastating diseases. We are very pleased with the results of Retrophin’s R&D so far and are committed to growing our R&D investment based on the success we’ve had thus far. I’m particularly proud of our development and prosecution of RE-024 for PKAN, a deadly disease affecting children and young adults worldwide. In a moment Dr. Alvin Shih, our new Head of R&D, will discuss this further and provide an update. Retrophin has made two acquisitions this year and both are demonstrating strong results that will fuel our expansion for years to come. Chenodal, our FDA-approved FXR agonist product generated its first full quarter of sales for the company and I am pleased with the results. Chenodal is a…

Thanks, Martin. The acquisition of Manchester Pharmaceuticals by Retrophin closed in Q1 2014, and as such Q2 2014 represents our first full quarter of revenue from Chenodal and Vecamyl. We instituted a price increase in Chenodal in Q1 2014. Payer support for the product has continued to be solid and we’ve seen a small increase in the number of patients on commercial therapy since then. We believe Chenodal is a valuable drug and our market research indicates it is used exclusively for the treatment of cerebrotendinous xanthomatosis or CTX but may have utility in other indications. CTX is extremely difficult to diagnose with the average age of diagnosis being patients in their mid-30s. Our focus is to improve diagnostic efforts in the US and to ensure that any patient in need of Chenodal has access to the product. In Q2 we announced the license of THIOLA from Mission Pharmacal. As Martin mentioned, THIOLA’s a potent treatment to avoid stone formation in patients with cystinuria, one of the most common genetic diseases. THIOLA’s supply had been discontinued for eight weeks when we licensed the product and we have fully restored supply to this market. In Q3 we intend to stabilize the market by working to get patients who had discontinued therapy during the product outage back on therapy. THIOLA has traditionally had both poor adherence and compliance. Patients with cystinuria do not physically feel better after taking THIOLA and some may discontinue taking the product prematurely or skip doses for this reason. We have moved THIOLA out of retail distribution and into a closed system utilizing specialty pharmacy in order to provide better patient support and improve compliance and adherence. THIOLA will be promoted to urologists and nephrologists with a small ten-person sales team. Besides putting this commercial team in place we’ve continued to build out corporate capabilities by adding some very talented people into the senior management team, and have recently added a Vice President of Human Resources, a Chief Compliance Officer, and a General Counsel – all very talented pharmaceutical professionals – over the last several months. Those conclude my remarks. I will turn it over to Alvin. Alvin?

Thanks, Steve. Q2 was a quarter of continued growth for Retrophin R&D. Retrophin R&D is poised to become a leader in rare disease research and development as we leverage our internal drug discovery capabilities in conjunction with strategic, in-licensing and M&A to create a broad and sustainable pipeline. I’ve begun a systematic and strategic review of the pipeline and I’m pleased to see many bright spots which could potentially transform the lives of patients with clear unmet medical needs. Our pipeline remains focused on rare diseases where we believe the scientific, clinical and regulatory environment support more rapid development of therapeutic candidates. The two programs anchoring our pipeline are RE-024 and Sparsentan. Let’s start with RE-024 which is a program we’re proud to have developed completely in-house. RE-024 is a potential therapy for pantothenate kinase-associated neuro degeneration, or PKAN for short. PKAN patients experience progressive neuro degeneration and have a median survival of less than a decade after diagnosis, and there are no approved therapeutic options. RE-024 has generated significant momentum in the research community. It is being made available to physicians worldwide who are interested in conducting physician-initiated research. Dosing of RE-024 has begun on two subjects through physician INDs. The data we have to date were released in our 8(k) filing and need to be interpreted with caution given that these are not blinded well-controlled studies but rather investigator-initiated research conducted independently on single patients at the discretion of the treating physicians. That said, we are encouraged by the early signs of potential benefit for these two patients on therapy. The first patient on RE-024 remains on therapy at the 11-week mark and has demonstrated sustained improvement from baseline in terms of scores on the Unified Parkinson’s Disease Ratings Scale, as well as a lactate level which was…

Thanks, Alvin. With that I’m going to turn it over to Retrophin’s Chief Financial Officer Marc Panoff who will share with you some of last quarter’s financial highlights. Marc?

Thank you, Martin. I will provide a brief overview of our Q2 2014 financial results. Our net product sales for Q2 2014 was $5.8 million from the sale of our three products – Chenodal, THIOLA, and Vecamyl. We expect increasing sequential quarterly sales through year-end. We reported net income of $8.5 million for the quarter ended June 30, 2014. Q2 2014 net income included income of $33 million for the change in fair value of derivative instruments related to warrants issued in connection with our 2013 private placements. Q2 2014 net income also include stock-based compensation expenses of $5 million. Excluding these accounting treatments and other one-time cash items actual cash flow used from operations for this quarter was $10.1 million. GAAP research and development expenses increased to $13.7 million for the three months ended June 30, 2014, compared to $0.6 million for the three months ended June 30, 2013. Stock-based compensation accounted for $1.1 million of research and development expenses for the quarter ended June 30, 2014. R&D expense was impacted this quarter by spending associated with supply of drug for RE-024 and Sparsentan programs. We expect R&D expenses to decrease modestly sequentially throughout the year on a quarterly basis. GAAP selling, general and administrative expenses for Q2 2014 totaled $11.3 million compared to $4.5 million for the same period in 2013. Excluding non-cash expenses and certain nonrecurring cash expenses, non-GAAP SG&A expenses were $5.7 million. We had approximately $43 million in cash and marketable securities as of June 30, 2014, and had a $5 million financing receivable related to the closing of our term loan that was received at the beginning of Q3. Martin?

Thanks, Marc. Retrophin will experience strong revenue growth this year and next as we continue to grow our Chenodal patient base and re-launch THIOLA. We are reiterating our 2014 revenue guidance of $30 million to $35 million and our 2015 revenue guidance of $60 million to $75 million. All of our other guidance from our THIOLA in-licensing announcement is reiterated and unchanged as we look forward to reaching profitability by year-end. Our business development opportunities are robust. Retrophin evaluated dozens of opportunities in Q2 and is selectively moving forward with several deals which may potentially be announced this year, some as soon as this quarter. I am confident that we can continue to add products to our commercial group and more selectively to our pipeline. While we are mostly interested in the profile of products I mentioned earlier, we have also explored some very large acquisitions including deals over $500 million. We are deeply thankful to our shareholders and other financial partners who have given us such strong access to capital. I should add before closing that during the February 13, 2014 update call to discuss Retrophin’s acquisition of Manchester Pharmaceuticals a question was asked regarding litigation regarding Celgene. Our response to that question and the presentation of the PowerPoint slide during that call made reference to improper conduct by a generic pharmaceutical company that has attempted to access Celgene’s S.T.E.P.S. program. We’d like to clarify that the generic pharmaceutical company that was referenced was not Lannett and it is our understanding that Lannett has not engaged in any improper conduct with regard to Celgene or the S.T.E.P.S. program. Further, we respect and admire Lannett and did not intend to suggest, imply or otherwise state that Lannett had done anything wrong or improper. We regret any misunderstanding that may have resulted from our comments or the material that was presented during the February 13 call. With that I’ll take any questions you may have at this time. Operator?

Thank you. (Operator instructions.) And we have a question from Zachary Prensky of Little Bear Investments. Your line is open. Zachary Prensky – Little Bear Investments: Thank you. I’ve got a number here but starting with Marc Panoff, can you give us some estimate of where you see exiting both Q3 and Q4 in terms of the company’s cash position?

No, we’re not giving guidance on cash position for this year. All guidance has been announced already, Zach. Zachary Prensky – Little Bear Investments: Okay, fair enough. So moving on to the cost of goods, is there some way for you to sort of give us an idea as to what the underlying profitability was of the first $5 million odd of sales of Chenodal and how you see the cost of goods being separated between one-time costs for both RE-024 and other expenses versus like you were paying for the actual supplies of drugs that you’re selling?

I think that our gross profits using net sales less cost of goods is appropriate and what we were expecting, and I would anticipate that that percentage, that gross margin percentage continues. And there are no one-time costs related to inventory. Zachary Prensky – Little Bear Investments: There are no one-time costs, okay, good. If I can just direct a question to Alvin, on the RE-024 scale up of dosing patients through this access program that we have, could you give us some idea as to how many additional patients over the next two quarters we’re going to expect to see on this drug, some range?

Yeah, that’s not a number that I would feel comfortable pegging because at this point it’s a physician-initiated effort. And so we respond to requests from physicians who are looking for therapies for their patients who at this point have no other options. And so we are in a responsive mode and we will do our best to support those efforts from the physicians who want to treat their patients but it’s not something that we are actively out there. Zachary Prensky – Little Bear Investments: Okay. Could you give us a little bit more color as to how the discussions with regulators are going in terms of structuring an initial company-sponsored trial or it’s too early to discuss?

I would say those discussions are still ongoing. We are committed to making RE-024 available to physician investigators worldwide and we’re in discussions with regulators worldwide to map out the best way to get it into official company trials. Zachary Prensky – Little Bear Investments: Okay. And then lastly on Sparsentan, when I look at the protocol for the trial it seems to require significant amounts of time investment by patients enrolling upfront – if I had to guess it’s probably at least a day or so in the hospital. When you look at the enrollment numbers are you satisfied with how the enrollment is going? Do you think there have been some pickups in certain locations and do you feel comfortable now given that the enrollment is underway that this trial is going to get enrolled fully by Q1?

Absolutely. I stand behind our guidance. I’m quite happy with the enrollment to date so far. I’ve brought many rare disease clinical trials and I can say that enrollment always takes a while to build up where the site initiations begin, but over time we expect that number to increase and I think we’ll be able to hit our enrollment targets. Zachary Prensky – Little Bear Investments: Okay, alright, thank you very much. No further questions.

Thanks, Zach.

Thank you. And the next question is from Jacob Ma-Weaver of Cable Car Capital. Your line is open. Jacob Ma-Weaver – Cable Car Capital : Hi, good morning. I first had a couple of questions on THIOLA. I was wondering if you could talk about what the underlying cause was of the raw material shortage and what steps you and Mission are taking to avoid any future supply issue?

Let me ask Steve to take that if he can.

Sure. The problem was basically with the API. Mission does the fill finish work themselves and there was never an issue with that. They purchase API from a Japanese provider, CMO, and they had not really adequately stockpiled backup API in case there was ever a late delivery. They ran into a late delivery from the Japanese provider that just put them in a position where they could not get product finished in time to keep patients from running out. It was a shortage that lasted almost two full months. So essentially most of the patients in the United States ran out of product somewhere during that time period. We worked with Mission now, giving them a forecast that allows them to stock in additional API from whatever they had done before and also have fronted them support to be able to put in backup API to be able to bring that to the states so that we never get into that situation again. Jacob Ma-Weaver – Cable Car Capital : Okay, great. And then what exactly do you need to do in terms of approval, studies, manufacturing changes or the like before you can actually make that hard switch to the new [dosages]?

This is Martin. I’m not sure that I fully understand your question but the API supplier that we have is qualified and fully qualified, so it’s just a matter for us of ordering more supply which we’ve done. I think our goal is to have for all of our drugs at least two years’ of API on-hand at all times, and in terms of a backup API solution I think it’s probably not appropriate for this call to go through too many details. Jacob Ma-Weaver – Cable Car Capital : No, sorry, I was unclear – I understand the API issue now but then in order to make the switch to the new dosages and the extend release format that you’ve talked about? I’m wondering what additional steps you need to take.

Oh yeah, great question. So for ex-R again, I think it’s somewhat premature to talk about the ex-R. There’s a lot of sort of work going on behind the scenes here to work on the lifecycle management of THIOLA, not just with an ex-R but with other approaches. And most importantly as you know the lifecycle management is really intended for patient compliance. THIOLA comes in a very, very inconvenient 100 mg format with patients taking as many as 10, 15 pills in some cases a day. So we’re working hard on everything you would expect we’d be to move the product to a more convenient format as well as hopefully enhancing some of our intellectual property. Jacob Ma-Weaver – Cable Car Capital : Great. And one last one on THIOLA if I may, I believe on the initial call you called it the only approved tiopronin [nationally] and I was wondering if you could talk a bit about whether there will be an international opportunity and also if Captimer I believe competes with the drug.

Yeah, so you make a really good point. There’s some spotty availability of tiopronin internationally which may preclude our entrance similar to Chenodal in certain international markets. So I would to your point be somewhat cautious about the international opportunity for both tiopronin and Chenodal. Having said that, we remain opportunistic and I look at those international markets as potential upside but would caution against expecting a lot of international revenue from THIOLA. Certainly when we gave guidance we didn’t include any international revenue for either of our products.

Yeah, I would agree with Martin and maybe if I could add one thing, which is the Mission folks were very accommodating and they have added Canada to the agreement. So we do have rights for THIOLA in Canada as well as the US and we are currently shipping some product into Canada. It’s going to be very minimal compared to the US opportunity but there is a smidgen of international utilization right now. Jacob Ma-Weaver – Cable Car Capital : Great. Well, before I go if you don’t mind one last big picture question and then I’ll let someone else ask a few more – I wonder, I imagine comparisons to Questcor must really irk at times and I’m just wondering if you can comment a bit on your philosophy when it comes to price increases, in particular how you came to the number you did on Chenodal, your thoughts on copayment assistance and the like.

Yeah, so I won’t comment on comparisons to any other companies. We are a very individualistic company with a very clear compass for our actions. And in terms of pricing, the way we look at it and I think you really have to put yourself in the shoes of these patients. We do a lot of things before thinking about a price increase. Actually one of the standard practices here at Retrophin is to ask permission from the patients, physicians, patient groups – every counterparty we can talk to about any re-pricing action that we take. And what we’re trying to do is get buy-in from these neglected communities. If you have a disease like cerebrotendinous xanthomatosis life in the condition of that sort of community had been pretty bleak or at least we think so prior to our entrance, and we think by entering this community and caring for it with enhanced financial support that’s only possible by making the product viable financially is something that we’re proud of. And if there is extra profit Retrophin, unlike maybe the company you mentioned and some other ones, we are aggressively investing in NCEs for R&D. As you know, RE-024 was invented from scratch at Retrophin by Retrophin employees and scientists and we’ve got several more products just like that that we haven’t disclosed. So we’re a full-fledged R&D company that is really attempting to create brand new drugs for people with very severe, often lethal and often pediatric diseases. So I think the comparison is not well suited, and if you ask the patients themselves you’ll find that, and in fact I’d asked the patient advocacy community – you’ll find that they’re very supportive of what we’re doing because for the first time we can sponsor conferences on these diseases like cystinuria or cerebrotendinous xanthomatosis which just wouldn’t have been possible. In fact if you look at the companies who owned them prior to us there was no money to make, there’s no money left over to invest in them. So by raising the price we can actually afford to make sure that no patient gets left behind and that more importantly in the case of something like CTX that these folks can actually get diagnosed in time to get saved by a treatment. And I think that’s not only a tremendous financial opportunity obviously but also just an ethical and humanitarian responsibility that we really enjoy. And then obviously with a full pipeline of great drugs for rare disease we feel great about having excess cash flow to support those. I appreciate the question very, very much. Jacob Ma-Weaver – Cable Car Capital : Great, thank you for that. That’s all for me.

(Operator instructions.) We have a follow-up question from Zachary Prensky of Little Bear Investments. Your line is now open. Zachary Prensky – Little Bear Investments: Thank you. Going off of what you said, Martin, can you comment a little bit about how you feel on, though these are early days about identifying additional CTX patients and how your initial efforts at having people do these retrospective analysis of patients who had done the cataracts – I believe we discussed that on the Q1 call. How is that going and do you feel that you need to put more effort or change the direction, or you’re comfortable with the direction you’re taking in terms of identifying new patients?

Yeah, I’m going to let Steve answer the question but I will say before I turn it over that we’re at an all-time high for Chenodal patients and we’ve got patients in the pipeline. More patients are on Chenodal than have ever been on the product in the history of the product and that’s not a modest increase, that’s a substantial increase from the beginning of the year. And I do think the actions we’re taking will continue to add patients, and if you listened carefully to Marc’s comments we do plan on sequential revenue increases, not only for the whole company revenue but also for Chenodal. But with that I’ll let Steve get a little more granular in terms of the actions we’re taking and his comfort.

Yeah, and I think it’s worth making sure – I think you know this but making sure that you understand that Chenodal is being used 100% off-label right now. And in that situation we have no ability to do any type of promotional activity. There’s no sales force behind Chenodal, no marketing efforts behind Chenodal. What we can and are doing is trying to create greater disease awareness and we believe that greater awareness and earlier diagnosis will lead to increased patients being identified at a younger age when therapy can have a more meaningful impact. The whole concept of patients with a severe neuro degenerative disease not being diagnosed until they’re in their mid-30s, until the significant neurologic damage already is done just doesn’t make sense in this day and age. So we’re hopeful that through proactive education on the medical side that we can encourage people to do a better job with diagnosis. If that happens I think there’ll be some natural fallout that will benefit the product on the revenue side. But again, we can’t promote the product and have no sales and marketing effort behind it, which is why we’re being very conservative with what we forecast in terms of potential additional revenues. Zachary Prensky – Little Bear Investments: Okay, but I guess I was hoping to hear some more granular detail on the initial thought which I understood was going back to patients in their mid-teens who had undergone cataract surgery and having those patients retrospectively screened for the genetic markers of the illness. Can you give us any comments on how that’s going and whether or not you think that’s the best use of the company’s resources?

We’ve had some significant discussions with high-volume ophthalmologists who do cataract surgery. Most of them have not been aware of CTX at all. They’ve been very candid about saying they just weren’t familiar. They have been intrigued by the concept of them being in a position to be really in a position of first to diagnose. They are not potential treaters – that’s been made clear to us by the group – but they are interested in going back and looking at their patients. We have gotten a proposal from one of the centers to do a multi-center retroactive study of going back and pulling patients, pediatric patients that have had bilateral cataract surgery and then doing testing. We’re likely to be supportive of that study and we’ll look forward to seeing some results from that. That’s really as far as I can go as far as granularity. Zachary Prensky – Little Bear Investments: That’s fair. It sounds like it’s the best use of the company’s resources from my little perch but obviously you guys know better, and it seems like you’re at least pushing it forward so that’s very heartening to hear. You underscored a number of times that we’re essentially fighting this fight with our hand tied behind our back given that the label is not indicated for this illness. Can you give us just finally some comments on how you see a path forward to getting the FDA to allow us to add that to the label, what sort of study or sort of filling would need to be done to do that?

Yeah, thanks for the question and I’ll ask Alvin to comment if he has anything to add to my comments. We are pursuing just like with THIOLA a potential new format for Chenodal. Chenodal is dosed three times a day. As you may know, many drugs from the initial era of drug discovery were dosed three times a day as convention. No one’s really sure if Chenodal should be dosed three times a day or not and we see that as a potential opportunity to maybe move the product to a once a day if it’s possible through a controlled release or some other mechanism. And while we do that we could potentially do a clinical trial to get it on label. But those, just like the question we got on THIOLA in terms of getting to another potential formulation, those projects are ongoing and I would expect updates over the course of years or quarters, not certainly one or two quarters. So they’re long-term projects that require review cycles and things like that, and guidance from FDA and all kinds of advice that takes time. And some of those may be on a global effort as well so and for obvious reasons I don’t think we want to tip our hand too hard in terms of what we’re doing. But we’re very excited about it and then just with respect with Chenodal, I just wanted to add one more comment to your question which was related to CTX patients. I think Chenodal, to my comments earlier, there’s a big wide-open space for Chenodal. It’s the only FDA-approved FXR agonist. There obviously could be another one coming, but the FXR agonist space seems to be exploding and I think Chenodal will have a very permanent fixture in that space. So you know, while everyone here is focused on CTX there are some other diseases we’re focused on and excited about, and they’re not the usual kinds of suspects. So I don’t know, Alvin, if you wanted to add anything?

No, I think that’s right. The regulatory strategy for Chenodal is part of the broader integrated asset strategy that we’re moving forward and always in discussion with the FDA who have shown themselves to be good partners on this asset. So those discussions continue and we’ll provide more guidance as we get clarity. Zachary Prensky – Little Bear Investments: Thank you very, very much.

Thank you.

Thanks, Operator. With that we’ll conclude the call. I just wanted to mention we’ve appointed a new Head of Investor Relations, Chris Cline, and look forward to everyone meeting him in the ensuing quarter. And thanks again for your time.