Cytodyn Inc (CYDY)

[XBRIANX]

FULL AUDIO of Cytodyn Conference call - March 24th 2016 -
Q&A session follows

For those who haven't listened yet.

https://www.youtube.com/watch?v=_6zywaDecKY

Operator

Greetings and welcome to the CytoDyn Investment Community Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

I would now turn the conference over to Mr. Michael Mulholland, Chief Financial Officer for CytoDyn. Thank you, Mr. Mulholland. You may begin.

Michael Mulholland

Thank you. Hello, everyone, and thank you for joining us today. This is Michael Mulholland and I’m the Chief Financial Officer of CytoDyn. Before we begin, it is essential that we provide you with important cautionary language related to certain Federal Securities Laws. Our remarks during today’s conference call may include forward-looking statements.

Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that are difficult to predict. Actual results may be materially different from any future results expressed or implied by such forward-looking statements.

These risks and uncertainties include among other matters that clinical trials may not commence or proceed as planned, products that appear promising in early trials may not prove to be viable on safety or efficacy grounds, products may not receive regulatory approval or market acceptance, competition may reduce the commercial potential of our products, we may experience product recalls or product liability and our patents may be challenged or unenforceable.

Although forward-looking statements help to provide complete information about the company, forward-looking statements may be less reliable than historical information.

The company undertakes no obligation to update publically, forward-looking statements except as required by law. Please refereed to our recent quarterly and annual reports filed with the Securities and Exchange Commission, for more information about the risks and uncertainties that could cause actual results to differ.

I will now turn the call over to our President and CEO, Dr. Nader Pourhassan.

Nader Pourhassan

Thank you, Mike. Greetings, everyone. Thank you for participating on this investment community update conference call. As always we will begin the call with prepared comments and then we will open the call for your questions.

As of today, existing management of CytoDyn has been in place for about three-and-a-half years. In 2012, when CytoDyn purchased PRO 140, it was not highly regarded as a profitable potential therapy for HIV.

All of its valuable features were not recognized due to the fact its development timeline was dragging along at a very slow pace. While being developed by Progenics, it took about 12 years to get PRO 140 to a Phase 2a to conduct at three-week monotherapy trial. And as we know today, it probably would have taken another 15 more years to take this product to commercial level.

Even though PRO 140 always demonstrated strong anti-viral activity with a remarkable safety profile that impressed the FDA and received Fast Track designation, and even though the NIH had granted PRO 140 $28 million during its first 12-years of development, yet PRO 140 did not have a great path to approval.

We believe CytoDyn has overcome this huge challenge by conducting a non-traditional clinical trial and generating a data that was anything but expected. Today, as all of our investors are aware, there is much focus on our Phase 3 monotherapy trial that could change the HIV paradigm for many of the HIV patients.

And there is even more focus on a publication of Phase 2b monotherapy results in a peer-reviewed journal that would give a new credibility to PRO 140 in the scientific community. I will address this issue later on this call.

Our very impressive Phase 2b monotherapy trial has provided new opportunities for the future of PRO 140 and its outlook is getting better with each day. Patients in the extension on as we previously reported are passing one-and-a-half years of complete viral suppression and our making history. And their weakly results are continuing to amaze us.

This is an incredible achievement unlike anything seen in the world of HIV treatment since the recognition of HAART, which saves millions from this deadly disease. However, HAART, Highly Active Antiretroviral Therapy, has its own challenges, which is mainly toxicity issues.

In the world of HIV, it is unheard of going without HAART, even for one-month, nonetheless for 18 months as our HIV patients have in the extension arm. These patients have only received a simple weekly subcutaneous injection of an antibody that is proven to have hardly any toxicity or side effect. If PRO 140 is ultimately approved as a monotherapy, then the eligible HIV patients could soon enjoy a life without all the toxicities that ranges from diarrhea, abdominal pain, nausea, to vomiting, rash, numbness, tingling, burning sensation, upset stomach, fatigue, chills, dizziness, headache, insomnia, fever and the list of drug toxicity goes on and on.

And if PRO 140 is approved for combinational therapy, then patients perhaps could replace the most toxic portion of their HAART regimen with PRO 140, and more importantly, the major issue with adherence, which is taking daily pills day in and day out in an exact same time could be mitigated.

CytoDyn’s strategy is to gain FDA approval for PRO 140 as a combination therapy, which we believe represents the quickest path to market followed by an approval for PRO 140 monotherapy back-to-back. As we have mentioned in our previous releases, our planned development of PRO 140 has not been limited to HIV, as we are taking this even further and exploring our first of potential several non-HIV indications mainly GvHD graft versus host disease transplant patient indication.

Our newly named Chief Science Officer, Dr. Denis Burger is leading all of our non-HIV indications for PRO 140. Because of all we have accomplished prior to 2016, we believe 2016 will be a remarkable year for CytoDyn and its shareholders.

Now in regards to recent progress, we understand that all of our investor would like to have everything happen quickly. But the reality in our business is exactly as it is listed on the FDA website, which is that drug development is a very lengthy process and it could take about 20 years from initial development to final FDA approval. However, to show how fast CytoDyn is moving in this tough field, allow me to list the last three months’ activities and update everyone in regards to each one.

In December of 2016 - I’m sorry, in December 2015, just about three months ago, the FDA cleared PRO 140 for a Phase 2 clinical trial in GvHD. Just about a week later CytoDyn filed for Orphan Drug Designation for GvHD. 30 days later after that we filed for Breakthrough Therapy Designation for PRO 140 for treatment experienced patients will have developed resistance against prior HIV regimen. Just a week later, CytoDyn announce that its Phase 2b monotherapy extension arm is still moving for with 11 patients still continuing and were passing 14 to 17 months of complete viral suppression.

Few days after this last announcement, which was just about a month ago, we announced that we submitted and initiated our much anticipated Phase 3 monotherapy trial with PRO 140 and are awaiting FDA comments before injecting the first patient. In my opinion are very productive and fulfilling three months.

So with that, allow me to update everyone about the following activities: Phase 3 monotherapy, Breakthrough Designation for HIV, Orphan Drug Designation for GvHD, Phase 3 Combination Therapy timeline, GvHD Phase 2 trial status, abstract submission to ASM Microbe Conference.

In regard to the Phase 3 monotherapy trial, we have received comments from the FDA and we are working with the KOL, Key Opinion Leader, to respond to these comments in the next few days. The comments did not have any clinical hold and the companies allowed to initiate this trial, but we will first finish responding to the FDA before we inject the first patient. However, initiation of hospitals and clinical sites are already well underway.

In regards to our application for Breakthrough Therapy Designation for PRO 140 for HIV, we received a response from FDA. The FDA indicated that the agency concurs with CytoDyn that treatment experience for patients who have developed resistance against prior HIV regimen meet the criteria for a serious or life-threatening disease or condition, which would warrant a Breakthrough Designation.

However, the FDA indicated that CytoDyn’s previous studies were not in the specific patient population that the Breakthrough Designation for PRO 140 was applied for. Therefore, CytoDyn needs data from that specific population that the Breakthrough Designation was applied for in order to be granted that Breakthrough Designation.

The company now could plan and to initiate a small study in HIV resistant patients to specifically address FDA’s comments.

Please keep in mind, our current combinational therapy Phase 3 and monotherapy Phase 3 trials are both in different populations than for which the Breakthrough Designation was applied. Again, this delay on Breakthrough Designation does not have any bearing in our two current trials, monotherapy and combinational therapy, and could be addressed if we do conduct a small trial in the specific patient population and submit to the agency the appropriate data.

In regards to Orphan Drug Designation, the normal waiting period is 60 days and this deadline has passed. As of today, we have not received a determination from the FDA on our Orphan Drug Designation application.

In regards to combinational therapy Phase 3 trial, we are working to determine firm timelines for when we will be able to enroll all patients and when we can un-blind the double-blinded efficacy section of our trial, and announce our primary endpoints results, and when the study will conclude and so forth. This we should have in the next four to six weeks.

In regard to Phase 2 GvHD, we are progressing forward without any delay.

Now in regards to ASM Microbe Conference, they had many investors and a few reporters request information in regards to our publication of the Phase 2 monotherapy data. Some suggested that maybe the data was not good enough to publish.

Please allow me to state here on record that our Phase 2b monotherapy data has surprised us, surprised our Key Opinion Leaders and surprised the inventor PRO 140. Furthermore, we continue to believe if our Phase 3 monotherapy is successful and replicate the result of the Phase 2b trial it could potentially change the HIV paradigm. However, we have not published our data from the Phase 2b monotherapy trial yet, because we have submitted an abstract to ASM Microbe Conference held around June 20.

And if we are accepted then the publication has to be delayed until after a possible presentation at that conference. Obviously, we have not announced whether we have been accepted to this conference or not, but the result have been out. Those who were granted a spot for presentation were notified as of February 29 about a month ago by ASM organizers.

Please feel free to go to ASM Microbe Conference website to read more about this very important conference. So not publishing the data from Phase 2b monotherapy had nothing to do with the caliber of our data, which we have said all along, we believe has been remarkable. Furthermore, this trial did not have data lock date at the end of the trial, due to many patients wanting to continue in that extension arm.

Our data lock date was picked about 10 months after the main portion of the study, even though many patients are still on the trial. So in conclusion, as we said before, our data has been ready for submission to a peer-reviewed journal.

So with all that, allow me to summarize the six important activities that everyone should note. Our current Phase 3 combinational therapy is underway. Our current Phase 3 monotherapy is going forward. Our current Phase 2b trial in graft versus host disease is underway. A Breakthrough Designation application that is on hold and will need more data from a small trial that CytoDyn could initiate. An Orphan Drug Designation application that has been filed with FDA about 93 days ago and we still have no results from the FDA in this regard. Last and not least is a publication of our Phase 2b data in a peer-reviewed journal, which has been delayed due to the submission of an abstract to ASM Microbe Conference.

So again, our Phase 3 monotherapy along with our Phase 3 combinational therapy for HIV is going forward and the FDA has not held us back from conducting a Phase 3 monotherapy.

And finally, all of our CMC manufacturing requirements for PRO 140 are going forward to assure we meet all the standards of the FDA and have promotional product ready once we have the FDA approval to launch PRO 140. Overall, we are very pleased and very proud of our continuing extensive progress in taking PRO 140 to new horizons and exploring all its capabilities.

Operator, we would now like to open the call for questions, please.

Question-and-Answer Session

Operator

Thank you. [Operator Instructions] Our first question from Francis Russo, a private investor. Please go ahead.

Francis Russo

Good afternoon, Nader. It’s Francis. Hope you are doing well. And I have a few questions for you. The first one is, now that you and Dr. Berger have approximately 17 other possible indications around cancer and autoimmune indications, three that you’ve publicly mentioned, will CytoDyn just reach out to few companies to get some type of non-dilutive equity? One easy target may be, could be Paul Maddon reaching out to Progenics. And I’d like to hear your thoughts on that.

Nader Pourhassan

Thank you, Francis, and good afternoon to you. As we mentioned before when we did our in vitro studies, we believe that we have indication in graft versus host disease. We did say that we would explore other indication, for example, cancer and other autoimmune diseases. But our strategy has not been revealed yet and we cannot talk about that at all.

Francis Russo

Understood. My other question, you were just recently in an article that you were speaking about CytoDyn as being a hot-hot story and you called the stock to get in the path. Do you or any board members have plans to buy shares in the open market at a premium over the current share price if you believe the stock is severely undervalued?

Nader Pourhassan

I cannot speak for our board members and I cannot tell you, when I said the stock is a gift I believe that our value is very undervalued obviously, but that’s all I can say at this time.

Francis Russo

All right. Thank you.

Nader Pourhassan

You’re welcome.

Operator

Thank you. Our next question is from Michael Langsdorf, a private investor. Please go ahead.

Michael Langsdorf

Doctor, it seems to be that it is pretty expensive to continue to develop more than one drug, especially when we’re selling stock at $0.75. Have you ever considered just sticking with the HIV until we get that done and stay away from the graft to host diseases, because it takes over $100 million I think to develop these things and therefore spreading ourselves too thin we’ve already had problems raising money?

Nader Pourhassan

Thank you, Michael. First of all, I did not know we had problems raising money. I was not aware of that, but having said that…

Michael Langsdorf

At $0.75 a share you are.

Nader Pourhassan

And as far as the graft versus host disease trial, as we indicated, the cost to do a Phase 2b trial in a different indication is less than $4 million, which could take the company to the position where we would have data that would be impressive. And since GvHD, the deadly disease, we thought we could do a Breakthrough Designation at that time. We thought that’s a great asset for us to have.

Now, having said that, we haven’t really spent a lot of money on GvHD. As you know, we have not even announced the first person being injected. So funding for something like that in our opinion is crucial.

Michael Langsdorf

Maybe I didn’t say it quite right. It seems to me that we have one primary drug which hopefully we get to market sometime in the next 24 months. Are we not diluting our efforts when we got more than one drug that we’re trying to get to market? That’s number one. And number two, when I say expensive money or you pay Paulson 10% to sell stock at $0.75, that’s a hard way to get money without diluting the stock.

Nader Pourhassan

So answer to your first question is no. Answer to your second question is we have indicated the market size out there for us when if we get approval, and we believe dilution, whether we go from 200 or 250 million shares at the end of the day if you’re successful is not going to impact us that much.

Michael Langsdorf

How much…

Michael Mulholland

Yes, let me just add…

Michael Langsdorf

…to develop the second drug, I guess, maybe that’s what I’m saying. How much do you think more is going to be necessary to develop our HIV and how much for the second one?

Nader Pourhassan

Mike?

Michael Mulholland

Well, as Nader just indicated, the graft versus host disease trial has an estimated cost of approximately $4 million. Earlier in your comment you indicated that we’ve got one drug and then you inferred that we were developing another costly drug for graft versus host disease. We don’t have multiple drugs. We have one antibody. And the one antibody is been evaluated in a non-HIV trial and that is the graft versus host disease. So it’s really not dilutive to all of management’s efforts and our capital resources by simply pursuing another clinical indication in a Phase 2b trial.

Nader Pourhassan

Next question, please.

Operator

Thank you. The next question is from Paul Rosenbaum with SWR Corporation. Please go ahead.

Paul Rosenbaum

Hi, doctor, I have a couple of different questions. One, you talked about a breakthrough designation that’s put on hold, because you didn’t target the specific patient population. Did you know what the specific patient population was and why didn’t you target it?

Nader Pourhassan

Thank you for this question. So the breakthrough designation was for resistance patients and we believe that when we had shown our product, PRO 140, working on patients who had viral load of more than 5,000 even. And it showed that it dropped the viral load for more than 2 log that indicated that we have a product that could work on that population.

But, obviously, our people who we consulted with disagree with FDA on that. But we will definitely respect the FDA decision and if we want to go forward with a Breakthrough Designation we will have to do a small trial. But having said that, we have a so strong two Phase 3 that we have to have an internal discussion and decide what we want to do.

Paul Rosenbaum

But how long does a small scale trial take? And, basically, if we do it, it doesn’t make that much of a difference as long as you’re already starting your Phase 3, correct?

Nader Pourhassan

That’s correct. But if we do a small trial and go forward, perhaps our timeline of getting our efficacy for Phase 3 is already met. And if that happens then, we believe that might not work for us. But having said that, the timelines are very, very quick and we don’t know that timeline. We have to explore that. Then we will make a decision and let everybody know.

Okay. Well, listen, this is an observation. It’s not a criticism. But the previous speaker, I couldn’t - I think what he was getting at, and if he wasn’t, I’ll get at it, is that you’re a small company, I’m a large investor in your company and I’m confused sometimes with the scope of what you’re trying to do. I’m an investor. I’m not a scientist. For me it seems to be all over the place in terms of what you’re trying to accomplish. I do understand there’s one antibody that has different applications. But why call this conference today when there is really nothing new as far as I’m concerned.

I’m assuming that you’re going forward on all these phases. What I’m concerned about is the reverse split. Can you talk about that now? Do you have any plans on doing it or is that something that’s on hold to see whether you develop all this in the future?

Nader Pourhassan

Yeah. Before Michael Mulholland comment on the reverse splits, if we’re talking - if we’re splitting hair over $3 million or so that we’re going to spend on GvHD that’s about as a price that we sold $0.75, that’s 4 million shares. So I don’t think for such a huge indication we should be, that’s our decision that we made. But as far as reverse split - I’m sorry.

Paul Rosenbaum

I’m not splitting hairs on the $3 million. I understand what you’re doing. It’s the presentation in terms of what you’re trying to do. It’s confusing sometimes to me and I’m not a stupid guy.

Nader Pourhassan

Well, I understand what you say. Let me have Mike comment on the reverse split. Go ahead.

Michael Mulholland

Yes. Let me just add that, again confirming, yes, the board has approval to affect the reverse split. And when in their judgment that it’s appropriate to do so and that authorization is effective through August 26, 2016, to reaffirm again, we do aspire to uplift to a national exchange for all the reasons we’ve previously cited: broader access to capital, expended shareholder base, improved visibility among many others.

But right now, our number one priority is capital and we need to keep funding the fundamental drivers of enterprise value and that’s our clinical trials. As I said before, we have mapped out the myriad of activities necessary to affect an uplifting. But we’re going to differ those efforts until it’s most appropriate for our shareholders.

The uplifting - the primary threshold for us with respect to quantitative listing requirements to uplift is a $2 stock price on the MKT tier of NYSC and a $4 stock price for NASDAQ. Based upon what we believe we have progressing in the months ahead, we hope to achieve at least one of those thresholds organically. And thus reversing - affecting to reverse stock split is not our highest priority right now.

Paul Rosenbaum

Good. Good. Thank you.

Nader Pourhassan

Thank you. Next question?

Operator

Thank you. The next question is from Jared Cohen of JM Cohen & Co. Please go ahead.

Jared Cohen

Yes, given what you have going on, I’m still - given your financing needs, I still haven’t understood why you haven’t gone out to a strategic partner like many of your companies be your size and where you are in Phase 3 trials have done. Can you answer that?

Nader Pourhassan

We cannot talk about any discussions with any big pharma or any other person that we’re talking in regards to partnering. So with that…

Jared Cohen

I know you can’t, I know you can’t, but have you at least tried to do that. I mean it seems that you should - I mean, given where you are, I mean, theoretically you should have a higher market cap. And companies your size seemed to be able to get that type of partnership.

Nader Pourhassan

So we have a very experienced - capital market experience in our Chief Scientific Officer and he, Dr. Burger, had explained many times to shareholders that we are on OTCB, we have to get to the next exchange in order to get the respect that we deserve because of our accomplishments, having said that, all of our focus is on that. Strategic partnering, we have never said we are closing the door to any one of those. We actually have our door wide open. But I cannot just comment on any of that.

But as far as going forward plan with capital market, those we are - this is in great hands of Dr. Denis Burger, me and Mike Mulholland, and we are working very closely with bankers and other institutes to accommodate us for that.

Jared Cohen

All right, secondly, you’ve never released any statistics going back to really to your Phase 2 trials, in terms of true statics of P value or anything else. Can you go into that a little bit?

Nader Pourhassan

Well, when you talk about P value, it doesn’t apply to when you’re talking about viral load of some patients.

Jared Cohen

Yes. I understand…

Nader Pourhassan

Yes, we are talking about the result has impressed the Key Opinion Leaders, thought-leaders, and we need to get that in peer-reviewed journal. We are working on that. That will be our key to get to the scientific community for the first time after Progenics has sold this product.

Jared Cohen

Okay. But you were supposed to be one at that conference to release something in February and that seemed to never happen and CROI where I think it. And why didn’t that happen?

Nader Pourhassan

CROI indicated they did not have slots available for Breakthrough Designation - I’m sorry, for the late breakers. So the fact that we didn’t get into it was explained also to us that there was many people trying to get there and therefore HIV didn’t have late breakers, so…

Jared Cohen

All right, thank you very much.

Nader Pourhassan

Thank you. Next?

Operator

Thank you. The next question is from Gil Solomon, a private investor. Please go ahead.

Gil Solomon

Hi, it’s great to have this discussion from everybody’s point of view. I’m a Medical Director at a health plan and I review all of the requests for new drugs. And I am very well aware of the FDA process and the cost of these drugs, and so, but not so much on the investment part, so I’m very interested to hear those questions.

But I’m very encouraged and I’m glad that you did have this update to find out what the FDA is doing, because that is a very arduous process to get through, so compared to the other drugs that I’ve followed I think that’s a very positive thing.

And I’m also gratified that you’re doing the graft versus host symptoms, Orphan Drug Designation, and there’s a very limited drugs to treat that. So that it would become an indication where, if it’s positive, there will be a lot of shift to treating this on an ongoing basis. So at least from my point of view, at least from the scientific point of view it’s sounds very encouraging.

Nader Pourhassan

Thank you so much, Doctor, for very useful comments. Next?

Operator

Yes, the next question is from Tom Parigian of Paulson Investment Company. Please go ahead.

Thomas Parigian

Hi, good afternoon, Nader.

Nader Pourhassan

Good afternoon, Tom.

Thomas Parigian

Okay. So, a few questions in response to a couple of investor questions, two for you, and then one for Mike. So did you in the board make a decision to spend relatively small money on the GvHD and the cancer opportunities as a result of having an anti-dilutive opportunity, meaning that if these two relatively small expenditures resulting in positive outcomes, could it and would it have an anti-dilutive effect by virtue of giving you an opportunity to sign a strategic?

Nader Pourhassan

That’s excellent of the version of question, Tom, definitely I wish more people would think in that way, because that is the correct way and that would open up huge opportunities for very small amount to spend.

Thomas Parigian

Thank you. So regarding ASM Microbe, you indicated or you suggested to the listeners on today’s call to go to the ASM Microbe site. And I suspect you did that because you can’t make an announcement regarding that conference, but it should be available on their site for us to review as to whether or not you will be included in June 20 conference. Is that accurate?

Nader Pourhassan

I believe you are accurate. I have not checked the website myself, but I encourage everybody who wanted to know more information about it to go to that site.

Thomas Parigian

Okay, thank you. And my last question, this one would be mainly for Mike Mulholland, one of the investors earlier indicated, in my opinion, that there were some negative aspects of the financing that CytoDyn has been successfully doing for the last several years. Because these financing have included a commission to an investment bank and that they have been done at $0.75, is it not true, Mike, that these $0.75 financings have been at higher valuations at each capital raise?

Michael Mulholland

Most definitely, over the course of the company’s relationship with your firm going back to the second half of 2013, our valuation in the market has been quite variable. As I’ve explained to many people our stock price in our view trades on investor sentiment and not on objective intrinsic valuation metrics. And on an unsolicited basis, I think your firm has done a good job of delivering capital every single time.

Thomas Parigian

Well, thank you. And that wasn’t the reason for the question, but I just want to make sure that I wasn’t under a misconception and that you as the CFO agree that each and every capital raise done at $0.75 was at a higher valuation than the one prior to it.

Michael Mulholland

Yes. I think on balance that’s true.

Thomas Parigian

Right, because there is more shares outstanding at each interval and I just wanted to make sure that the listeners understood that. Thank you.

Michael Mulholland

Yes. Thank you.

Nader Pourhassan

Thank you. Next?

Operator

Thank you. The next question is from Richard Giannotti [ph], a private investor. Please go ahead.

Unidentified Analyst

Nader, good afternoon.

Nader Pourhassan

Good afternoon.

Unidentified Analyst

I just - like my comment dovetails on the gentleman from Paulson. And I’m a pretty simple guy, so, I guess, yes, I understand where he’s saying that the more shares that are out there in $0.75 it places to a higher value. And so, I guess my question is, where in the world with all that you have going on, which in my opinion is fabulous, and I’ve been with this company for more years than I would like to admit to my wife, is where is the selling coming from, because I can’t piece it together?

And again, I’m a simple person. So as I follow the sales that go on and sometimes the huge blocks that are sold, and then it seems to be wobbles now at $0.80, I’m wondering if the board ever has a discussion about that and whether you could answer that, and maybe the gentlemen from Paulson like to get back on the line and explain to me and keep it out of the people aren’t selling shares and holding onto their warrants, because that’s a great arbitrage and I comment them for doing that.

And I guess, another part of the question might be is how long is our relationship with Paulson are we obligated to.

Nader Pourhassan

In regards to who is selling, we do not keep track of people with stock, whether they’re going to be selling or not. That’s not our…

Unidentified Analyst

Right.

Nader Pourhassan

We cannot get in…

Unidentified Analyst

No, I get that, I get that. Your job is to run the company and keep PRO 140. And you are doing a marvelous job. I just want…

Nader Pourhassan

I appreciate that.

Unidentified Analyst

Yes. I’m just…

Nader Pourhassan

No, I appreciate that. And I just want to bring it to everybody’s attention that Gilead, just 1997 or so, if you look at their chart they were trading very, very low numbers less than $1. And Warren Buffett and an analyst pass on that company, they had huge success. The fact that people don’t recognize soon enough is not something that we are concerned with, because we believe we are having tremendous amount of success getting ourselves to Phase 3 and doing remarkable job. Our clinical clinicians are doing remarkable job getting us to the next stage. But as far as the selling and the relationship with Paulson, I’ll let Mike answer that.

Michael Mulholland

Well, I really can’t speak to why certain shareholders sell their stock, or I can’t speak to what their investment horizon is and what their holding periods are. Also I can do is refer to as a finance guy is to what’s the true valuation of our company. And that’s not yet known or hasn’t been identified. I think if one does some - their own independent due diligence and reflects on market sizes or market opportunities of some of our clinical indications, which we have updated on our website late last month, and investor can come to their own conclusion with respect to whether or not $0.80 makes any sense or not. But we certainly can’t comment.

Nader Pourhassan

Yes. And one thing I should add is Paulson has very tremendous amount of funds for us in the last two-and-a-half years. But then I’d like to thank all the brokers. I said to them, you guys have helped the company to bring a very important product to the patients of the world and you should be very proud of what you’ve done. All of our success would have never been accomplished, even an inch of it without Paulson.

And the first time we raised money with Paulson, we had a lot of shareholder disgruntled. But after they saw that we got to Phase 2b with that money and we were able to generate the data with that money, they all had a whole new respect for Paulson.

Michael Mulholland

Let me just add in direct response to your question, our placement agent agreement with Paulson came to a natural expiration at the end of January in connection with the final closing of our private offering, which was announced shortly after in an 8-K. And we have no agreements going forward.

Unidentified Analyst

Okay. I’m just - I know nobody can pinpoint who would be selling. But the thing is that - and again I’m just rambling here, is - if you could find out who is selling, it would - the price of the stock would obviously reach a much higher level, because in my mind it should be $2 right now, if not, even more given the potential that you have, even though speculation in America seems to have gone by the wayside. Either that has to stop or I would like you to stop, or the other thing is eventually if we are going to reach the high watermark, because you’re going to come out with a fantastic announcement and that will propel the company stock price to go up, because then everybody will see your true value.

So keep up the good work. If those on the line are sellers, do me a favor, stop, please. Happy Easter.

Nader Pourhassan

Thank you. Happy Easter to you. Thank you. Next?

Operator

Thank you. Our next question comes from [Doug Hibberd of NTB] [ph]. Please go ahead.

Unidentified Analyst

Good afternoon.

Michael Mulholland

Good afternoon, Doug.

Unidentified Analyst

Just a couple of quick questions, on the Phase 3 for the adjunct treatment, I’ve noticed you’ve got 26 sites set up. And some of them are enrolling, some of them aren’t. They’re all active. Can you give us any indication on how are you going as far as enrollment. And the other thing is…

Michael Mulholland

Go ahead.

Nader Pourhassan

Go ahead.

Michael Mulholland

No, go ahead.

Unidentified Analyst

Well, I was going to say, on top of that I’m a firm believer that third-party validation is what we need. And you’re working towards that with the ASM Microbe concert. And I was hoping that the breakthrough therapy in essence would be a third-party validation by the FDA. I mean, this is then basically saying there isn’t anything out here like this.

If the data is going to be revealed and you’re really making headway with the Phase 3 treatment adjunct trial, then it would seem a moot point, whether the breakthrough is even really needed.

Nader Pourhassan

So thank you, Doug, for that. The number of sites, you are correct, it’s close to 24, 26. We have a policy. We announced first patient and last patient. However, in my speech I indicated that in four to six weeks we will give a very firm timeline. In regards to the breakthrough that we mentioned, I have to tell you that when we met FDA, they said, look guys, we’re giving you very, very short study. And that breakthrough is very close to this.

So even though that, they have now just told us give us a data in this population, we’ll give you that also. So we’re very pleased with everything going forward and breakthrough designation. I know everybody wants to start right now, right now. But we have a one small study we will conduct, if we wanted pursue it, and not, concentrate on the Phase 3, two of them.

Unidentified Analyst

Okay. So I missed that. You said you’d have a clinical trial update in a few weeks?

Nader Pourhassan

That’s correct. We want to give in four to six weeks, we will give firm timelines for when we believe we will be able to announce our un-blind or for example un-blinded, double-blinded side and talk about the efficacy. And we will have those timelines out for everybody.

Unidentified Analyst

Okay. I’m sorry for missing that. I appreciate it. Thank you, guys.

Nader Pourhassan

No problem. Thank you, Doug. Next?

Operator

Thank you. The next question is from Robert Sawyer, a private investor. Please go ahead.

Robert Sawyer

Nader, how are you?

Nader Pourhassan

Very good…

Robert Sawyer

Congratulations. Everything looks good. On the conference, could you explain if we’re invited to this conference how important that is to PRO 140 to our stocks, CytoDyn? Can you explain how important that is?

Nader Pourhassan

Yes, so, Bob, we cannot really talk too much about that. But if you go to their website, it’s I think about 4,000 scientists in the world. This is the first time it’s called ASM. It used to be ICAAC. And it’s really, really gigantic. I wouldn’t say it’s less than the CROI by any way, shape or form. And I would allow people to just go to their website and draw their own conclusion.

Robert Sawyer

All right, and one thing I noticed today that Orphan Drug status, and maybe I was wrong on this, thinking, but when I was looking at the FDA website, I noticed that Orphan Drug status is 100 days. And I’ve been told that it was 90 days. So you’d said that we had not heard from them yet. Maybe, we just haven’t - maybe we’ve got another 10 days to go. Am I correct or wrong on that?

Nader Pourhassan

What was told to me by our CRO was it’s at 60 days, but FDA was running behind perhaps 30 days or so. But being at 93 days, it is 90 days, 100 days or anything, we shouldn’t be more than a few days away.

Robert Sawyer

Yes, because you did, I believe you applied the December 22 if I’m correct for Orphan Drug status. So that’s…

Nader Pourhassan

That’s...

Robert Sawyer

No, I think we’ve got just probably - if I’m correct, hopefully, we’ll have a nice Easter basket at the end.

Nader Pourhassan

Okay.

Robert Sawyer

And I appreciate all you’re doing. And keep up the great work.

Nader Pourhassan

Thank you. I appreciate your support. Next?

Robert Sawyer

Thanks.

Operator

Thank you. Actually, gentlemen, at this time, we have no further questions in queue. I’d like to turn it back over to you for any additional closing comments.

Nader Pourhassan

So thank you, everybody, for being on the call. We believe we summarized everything that we are doing and updates. I hope to hear from anybody via our e-mail, at website, or a letter. Thank you so much.

Operator

Thank you, ladies and gentlemen. This does conclude today’s teleconference. You may disconnect your lines at this. And thank you for your participation.