Title

Presentation

Capricor Therapeutics, Inc. misses on earnings expectations. Reported EPS is $-0.53 EPS, expectations were $-0.33.

Operator: Good afternoon, ladies and gentlemen, and welcome to the Capricor Therapeutics First Quarter 2025 Earnings Call. At this time, all participant lines are in listen-only mode. Following the presentation, we will conduct a question-and-answer session. [Operator Instructions] This call is being recorded on Tuesday, May 13th of 2025. I would now like to turn the conference over to our CFO, A.J. Bergmann, for the forward-looking statement. Please go ahead.

A.J. Bergmann: Thank you, and good afternoon, everyone. Before we start, I would like to state that we will be making certain forward-looking statements during today’s presentation. These statements may include statements regarding, among other things, the efficacy, safety, and intended utilization of our product candidates, our future R&D plans, including our anticipated conduct and timing of preclinical and clinical studies, our enrollment of patients in clinical studies, our plans to present or report additional data, our plans regarding regulatory filing, potential regulatory developments involving our product candidates, potential regulatory inspections, revenue and reimbursement estimates, projected terms of definitive agreements, manufacturing capabilities, potential milestone payments, our financial position, and our possible uses of existing cash and investment resources.

These forward-looking statements are based on current information, assumptions, and expectations that are subject to change and involve a number of risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. These and other risks are described in our periodic filings made with the FCC, including our quarterly and annual reports. It is our caution not to place undue reliance on these forward-looking statements, and we disclaim any obligation to update such statements. With that, I will turn the call over to Linda Marban, CEO.

Linda Marban: Thanks, A.J. Good afternoon, everyone, and thank you for joining today’s first quarter conference call. Today, I will review the latest updates on the progress of our BLA, seeking full approval for deramiocel in treating Duchenne muscular dystrophy cardiomyopathy, as well as a brief update on our pipeline program. While we understand that there have been some changes at the FDA, we remain confident that the strength of our data, which I will highlight in a few minutes, combined with the unmet need in treating DMD cardiomyopathy will potentially lead to approval. Our path with FDA to this point has been smooth, and FDA has not fallen behind in any way. Our objectives, deliverables, and timelines remain on track.

There has also been concern expressed over the announcement of an FDA advisory committee meeting for Capricor. I want to highlight that having the opportunity to participate in an adcom is a positive step for Capricor, for deramiocel, and for the program as a whole, because it gives us the opportunity to showcase the strong scientific and clinical data that is the basis of our BLA. We do not believe, nor has FDA signaled, that the determination to hold an adcom has anything to do with weaknesses in the application. But rather, we believe the nature of a first-in-class therapy for a new indication warrants additional feedback from subject matter experts in the field, as well as giving the advocacy and patient community an opportunity to voice their opinion on deramiocel.

The adcom also affords us the opportunity to highlight that deramiocel has a strong safety record, demonstrated in over 700 infusions, treating over 250 patients, with some subjects receiving deramiocel infusions for almost five years. We are asking for approval for a therapy that has been shown to be generally safe and effective for the treatment of DMD cardiomyopathy, for which there are no approved therapies. For those new to the story, deramiocel is a cellular therapy, is a biologic comprised of a rare population of cardiac cells that reside in the heart. We have spent almost 20 years developing, characterizing, and harnessing their potential. Our clinical focus for the past approximately eight years has been Duchenne muscular dystrophy, a rare X-linked neurodegenerative disease with no cure, afflicting approximately 15,000 boys and young men across the United States, and over 150,000 across the world.

These young men aim to live life as any strong-willed young adolescent boy would desire to, but throughout the course of their life, they suffer from devastating symptoms, ranging from loss of ambulation, leading to full or part-time wheelchair use, deterioration of their upper limb function, leading to assistance needed to accomplish daily tasks, such as feeding themselves or taking a drink of water, followed typically by the use of ventilatory support for breathing, and ultimately, DMD takes their life. I highlight these things to paint the picture of what these young men experience in their daily lives and why it is so important to develop therapies to attenuate the disease process. Now, what is our indication exactly? It is the heart disease that affects every patient with DMD at some point in their lives.

Every day, silently, the hearts of the DMD boys are being damaged, and no standard cardiac medication is good enough to combat that process. DMD cardiomyopathy is now the leading cause of death in DMD, and deramiocel is the only therapeutic that has been shown to be effective in slowing the decline in ejection fraction, which is a measure of how the heart is meeting the needs of the body. While there has been some progress made in treating the dystrophinopathy with several drug therapies now on the market in the U.S., specific to the genetic mutation associated with the disease, there are no therapies approved or on the market that aim to specifically treat the cardiomyopathy associated with DMD. Deramiocel’s mechanism of action, which is immunomodulatory and antifibrotic, is directly targeted to treat the secondary effects of DMD, and we believe can be used with other therapeutics which are currently approved or in development to treat the genetic mutation.

Deramiocel is delivered by a simple intravenous adhesion once a quarter at a dose of 115 million cells. I would now like to discuss the data that supports our BLA. The filing is based on our blinded, randomized, and placebo-controlled HOPE-2 study, and also by the HOPE-2 open-label extension study compared to a robust FDA- and NHLBI-funded natural history dataset. While sample sizes are small, what is most relevant is not the size of the dataset, but that the statistically and clinically significant differences are highly unlikely to be due to chance. We have worked with multiple internal and external statisticians, presented the data at meetings and to KOLs, and what we have heard, seen, and acted upon was that the likelihood is extremely low that the impact on the heart, or for that matter the skeletal muscle, is due to chance.

We have three clinical trials and approximately four years of open-label extension data that supports that premise. There has also been an emphasis and written guidance from FDA encouraging the use of real-world evidence to support clinical trial data, especially in rare diseases. Deramiocel is a perfect case for using this type of data to validate the efficacy of a drug product. According to the HOPE-3 trial, our Phase 3 study, which is ongoing and fully enrolled in the United States, I want to be clear that at this time, FDA has not requested the efficacy data from the HOPE-3 study to support our BLA application, although FDA has reviewed and will continue to review the safety data from the study. Our current plan is to use this data in the future for potential label expansion and are actively evaluating plans for HOPE-3 to be expanded internationally.

We will provide more updates on this program as they become available. Now, as we are transitioning Capricor from a translational medicine company into a commercial stage entity, we continue to actively work with our commercial partner, NS Pharma, on launch readiness for the United States. As we announced earlier today, we also have appointed Dr. Michael Binks as our new Chief Medical Officer. I am extremely proud that Dr. Binks joined our team. He has over 25 years of experience leading global clinical development translational research efforts across the industry, most recently as Vice President and Head of Rare Disease Clinical and Translational Research, Worldwide Research Development, and Medical at Pfizer, and prior to that at GSK, where he was instrumental in advancing multiple first in class therapies in early and late stage development.

Based on our current plans, we aim to have over 100 patients transition from clinical to commercial product following potential BLA approval. Let me remind you that we have been providing deramiocel to all open label extension patients for over three years. Nearly all HOPE-3 patients are in open label extension now and will transition to commercial product if it is their desire to continue on deramiocel. We, along with NS Pharma, are now working with physicians to assist them in preparing to prescribe deramiocel for DMD cardiomyopathy. We know it will be a partnership between treating neurologists and cardiologists in prescribing deramiocel, and this is part of the reason we are enhancing our medical leadership with Dr. Binks, who will guide the physicians through the prescribing process.

Please remember that deramiocel is not designed to compete with the medicines that address the dystrophinopathy, such as gene or exon skipping therapies, but rather to address the secondary aspects of the disease, which is inflammation and fibrosis, both in the heart and skeletal muscle, and again, has a very strong safety profile. It’s important to note that a naturally derived cell therapy does not have the safety risk that is in any way similar to the gene therapies, which do involve viral vectors. Now, for an update on our commercial manufacturing preparations. As you know, we built our San Diego GMP manufacturing facility for the purpose of commercial manufacturing, so I have a high degree of confidence in our processes, procedures, and facilities.

To remind you, our San Diego GMP facility is fully staffed and operational and is currently producing doses of deramiocel. In addition, we are underway with our previously announced manufacturing expansion to build additional clean rooms in the same facility. We plan on the expansion to be operational mid to late 2026, allowing us to bolster supply of the product to meet potential demands. Turning to an update on our European partnering opportunities, we remain in negotiations with Nippon Shinyaku with respect to the potential distribution of deramiocel in the European region and have extended the period of negotiation of the definitive agreement to the end of the second quarter. Our strategy is emerging in regards to ex-USA markets, and we will continue to explore opportunities for our technology in other areas globally.

We will add additional color as our strategy for Europe continues to unfold. And finally, for an update on our exosomes program, we continue to develop our stealth exosome platform technology as part of a next generation drug delivery platform. While this program has taken a backseat appropriately to deramiocel, we are still working to develop exosomes as cellular delivery vehicles. We believe strongly in this opportunity and the exosome’s ability to change the way we get biologics across the cell membrane. Our exosome development team is focused on advancing an efficient and cost-effective way to manufacture them for scale for therapeutic utilization. Despite all the concerns regarding vaccines based on the newer ethos of the FDA, I am pleased to inform you that our program under Project NextGen, which aims to test vaccine candidates for COVID-19 prevention and to prepare for future pandemics, remains underway.

Our vaccine is very important because it is natural, made from the native proteins, and contains no adjuvants, which has been one of the main concerns of the new HHS Secretary. We continue to work in conjunction with the National Institutes of Allergy and Infectious Diseases, otherwise known as NIAID, which will conduct the clinical trial and provide the data to us. This vaccine could potentially be game-changing as it meets all the criteria set forth by the U.S. government on future vaccine technology. Phase 1 of the trial is set to start in Q3, and we will provide updates on this program as they become available. In conclusion, our program remains strong, both with our path to deramiocel’s potential approval and our exosome platform. Our cash balance totals approximately $145 million, with our current runway taking us into 2027 with no additional infusions of cash.

If we receive FDA approval, we will be slated to receive an $80 million milestone payment from Nippon Shinyaku, and we will also receive a Priority Review Voucher, which we have the full rights to sell. These non-dilutive cash infusions could potentially total well over $200 million. This would allow us to enhance our therapeutic pipeline for deramiocel, as well as expand other areas of our pipeline in an effort to deliver value for patients and for our shareholders. With over 250 publications on the CDCs, including the Mechanism of Action deramiocel, and multiple statistically significant and clinically relevant clinical trials demonstrating deramiocel’s impact on patients, we look forward to presenting our data to the Advisory Committee. At this time, we don’t know the specific date for the meeting, but we will alert the market when a date is set.

I want to thank you for joining today’s call. We truly appreciate your continued support. I will now turn the call over to A.J. to run through our financials.

A.J. Bergmann: Thanks, Linda. This afternoon’s press release provided a summary of our first quarter 2025 financials on a GAAP basis, and you may also refer to our quarterly report on Form 10-Q, which we expect to become available shortly and will be accessible on the SEC website, as well as the financials section of our website. Let me start with our cash position. As of March 31, 2025, our cash, cash equivalents, and marketable securities totaled approximately $144.8 million. Turning briefly to the financials, revenues for the first quarter of 2025 were zero, compared to approximately $4.9 million for the first quarter of 2024. I’d like to point out that the source of our revenue for the first quarter of 2024 was the ratable recognition of the $40 million we received under our U.S. distribution agreement with Nippon Shinyaku, which at this point has now been fully recognized as of December 31, 2024.

Moving to our operating expenses for the first quarter of 2025, excluding stock-based compensation, our research and development expense were approximately $16.2 million, compared to approximately $10.1 million in Q1 2024. Again, excluding stock-based compensation, our general and administrative expense was approximately $3.1 million in Q1 2025, and approximately $1.8 million in Q1 2024. Net loss for the first quarter of 2025 was approximately $24.4 million, compared to a net loss of approximately $9.8 million for the first quarter of 2024. We will now open the line up for questions.

Operator: Thank you. Ladies and gentlemen, we will now begin the question and answer session. [Operator Instructions] Our first question comes from the line of Ted Tenthoff from Piper Sandler. Your line is open.

Ed Tenthoff: Great. Thank you very much. Can you hear me okay?

Linda Marban: We can hear you fine. Thanks, Ted. How are you?

Ed Tenthoff: Very well. Thanks. So, I just want to pick up on some of the comments that you had. Have you guys had your site inspection yet in San Diego? And if not, can you tell us when that’s scheduled for? And then, just with respect to preparation for the adcom, walk us through maybe what you consider to be key features and anything along the lines in terms of particular prep. Thank you.

Linda Marban: Thanks, Ted. Yeah, we haven’t had our pre-licensing inspection. It’s coming up this quarter within the next few weeks. And so, we’ll update you guys once it’s completed. I will tell you this place is abuzz with preparation and we feel really good about it. And we’re looking forward to having that inspection done. Reminder, which I said in my prepared remarks, but this facility was built in anticipation of commercial manufacturing. And so, we feel pretty ready for it. In terms of adcom prep, we are actively working on that. We had anticipated, as we’ve said multiple times now, that it was going to be requested by the agency. Typically, as I also just stated, when there’s a new indication or a new therapy, first in class, they almost always conduct an adcom.

We actually think it’s an incredibly good sign that they’ve asked for an adcom. One, it shows that the agency is really moving forward with our application. And I will tell you, with, I think we’re over 20 information requests now, a follow-up meeting with them as most recently as tomorrow and several other meetings along the way. They are actively in our file, reviewing our file, and working with us. They have told us in mid-cycle review that there were no substantive issues, which gave us good confidence in that. In terms of adcom prep, we’ve already had two mock adcoms. And without speaking about that because of confidentiality, I can say that we passed with flying colors and the data looks really great. So, we’re looking forward to the future.

We’re waiting for our PDUFA date. And things here are hopping along as we get ready for approval.

Ed Tenthoff: Great. Thank you so much.

Operator: Our next question comes from the line of Leland Gershell from Oppenheimer. Your line is open.

Leland Gershell: Good afternoon, and thanks for taking our questions. Just two from us. Linda, first, just wanted to ask with respect to Nippon Shinyaku, you had signed kind of that, letter of intent or what have you back in the fall. And I know you’d updated us that you’d extended that negotiation period. Just wondering if we could also maybe read into that, that you may be considering an alternative mechanism for launching in Europe, perhaps on your own, which could be more lucrative to Capricor in terms of economics preservation. As we’ve seen, rare disease therapy is often to be even better over in Europe than in the States. And then the second question is with respect to NS in the States. If you could just share to the extent you can kind of how they’re set up here in terms of their footprint for marketing, deramiocel presenting approval. Thanks.

Linda Marban: Thanks, Leland. It’s always great to hear your voice. So addressing your first question about our LOI with NS and the EU opportunity. We have had really great experiences building towards commercialization with NS in the United States. We think that they’re a great partner in the U.S. and we’re excited for the launch. And I’ll get into some of that color in your second question. In terms of Europe, we’ve moved forward very rapidly in the United States. We were told and have now filed a BLA for deramiocel in the U.S. We have a great plan in the U.S. And we believe that that can be enacted in Europe. As you correctly stated, therapies for rare diseases have a different path in Europe. And there’s nothing currently improved in Europe for GMD.

And our data is very strong and meets AMA criteria. We are working directly with the European authorities ourselves right now as we prepare for moving into Europe. And so we are evaluating on a regular basis the opportunity. We certainly remain in active negotiations with Nifun Shinyaku. And we’ll provide more updates on that program as our thoughts and theirs evolve. In terms of their opportunity in the States, they’ve done a really nice job of building a sales and marketing distribution team for Viltepso, which is their exon skipper. And so these seasoned executives who are U.S.-based and have spent a lot of time in the Duchenne space are preparing to launch deramiocel. They have 125 FTEs. We’re told that nearly all of them are focusing on deramiocel at this point.

Now, we work with their leadership both in the States and also in Japan so that we remain aligned on the path forward. We are enhancing our own management team. As you heard today, we appointed Dr. Michael Binks as Chief Medical Officer. Dr. Binks is going to build some Medicare support behind him, which we’ll be talking about over the next month or two. And we will continue to support Nippon Shinyaku in their education and commercialization for deramiocel to physicians in the community.

Leland Gershell: Thanks very much.

Linda Marban: Thank you, Leland.

Operator: Our next question comes from the line of Kristen Kluska from Cantor Fitzgerald. Your line is open.

Kristen Kluska: Hi, good afternoon, everyone. Thanks for taking the questions. I look forward to meeting and working with Dr. Banks on your team. So you made a comment that when you talk to several key leaders, they truly point out that these effects can’t be by chance. And that’s something that we often hear as well when we speak to thought leaders. But I wanted to ask, what are the biggest key drivers that these physicians say is that proof? And I know the FDA certainly is no stranger to the natural history work having funded it themselves. But maybe can you talk about what they’re viewing as truly the strongest signals when they look at that data set?

Linda Marban: Yeah, Kristen, thanks. So you have just hit on the most important part of our application, and I want to highlight that. The relevance, even though theoretically in terms of new numbers of patients, the numbers are small, the sample size is small. In reality, the reason that we were able to say very confidently that there is very little chance that the data is due to chance is because of the statistical significance. Now, the statistical significance is actually a number that says how much likelihood is your data due to chance? And what we were able to look at here is that MRI, cardiac MRI, which is an objective measure of cardiac function. You can’t wish your heart better. You can’t volitionally think, gee, I’m going to perform better in the MRI today.

And you can’t do anything really to sustain or improve cardiac function in any relevant way in a short-term basis. And that is why MRI is such a clever and easy way of determining disease progression. So Dr. Jonathan Soslow, who also is the lead author on the paper for the National History Study and is funded, as I mentioned, by FDA and NHLBI to collect that data, has spoken very eloquently and pointed to literature that shows that very few patients are actually necessary to discern a treatment effect using cardiac MRI. So we are confident in the data. We are hopeful that the FDA will be confident in the data and that the outcome will also support the data because, as I mentioned, taken together mathematically as well as in an individual patient basis, the data is a very strong suggestion of not only improvement in ejection fraction, which is a measure of how the heart meets the needs of the body, but also the long-term stabilization and even improvement in cardiac function.

Our open-label extension guides are out to four years now and some of them have dropped literally no ejection fraction points, which at a non-ambulant, later-stage descent patient is almost unheard of.

Kristen Kluska: Thank you for that. And yeah, that was literally going to be my next question. Last summer is when you presented the three-year data. And while I know we don’t have a date yet for this adcom, I’m wondering if you will have any four-year data to share at that point with the agency or if you’ve been disclosing early data as you’ve had these ongoing review meetings.

Linda Marban: Yeah, we plan on presenting the four-year data at the PPMG meeting in June. And I’m delighted to say that the four-year data is looking very promising. I’ll give you that little bit of a preview. But it is really quite exciting to see this long-term stabilization. As I mentioned, not only in the disease process, but remember, our guys are the older guys. These are the guys that are in the later stage of the disease that they are losing function in a measurable and very almost reliable, bad to say, way. And so the fact that there’s long-term stabilization in cardiac as well as performance of the upper limb function is really important and data we plan to highlight at PPMG.

Kristen Kluska: Okay, thanks. And then the last question that I had is, obviously there’s been a lot of changes at the administration. So can you just talk from a high level, if the people that you’ve been speaking with over the course of the year and beyond when you first presented these data to the FDA, has there been a lot of changes within that? Or for the most part, are most of the people that you’re speaking and working with the same people that have been part of the process? Thanks again, everyone.

Linda Marban: Thanks, Kristine. You know, it’s funny, I get asked that question now, I don’t know, eight to ten times per day by investors. And I think it’s really important to say that we see the FDA really starting to calm down and stabilize. The appointment of Dr. Macari, the appointment of Dr. Prasad, both of which have spoken about their commitment to rare disease, their commitment to moving therapies forward, and their commitment to making sure that medicines get to patients as they need them based on good quality data, which Capricor certainly has, has given us great confidence. Taken together, the reviewers that we’ve worked with over time, for the most part, most of them are there. We believe that Nicole Verdun is still there, and she has been working on our file really since the beginning of 2024 when we started having high visibility with the agency.

And several of the other reviewers, who I don’t want to call out their names, are definitely still there, definitely engaged. And as I mentioned in my answer to my question to Ted, we are getting literally bombarded with questions and opportunities to continue the conversation with FDA on a weekly basis, so we know they’re actively in our file.

Operator: Our next question comes from the line of Catherine Novack from Jones Research. Your line is open.

Catherine Novack: Hi. Good afternoon. Thanks for taking my questions. I’m just wondering strategically, suppose that the FDA issues a CRL for efficacy in August, you know, what’s the plan? Would you then read out HOPE-3 and submit for DMD skeletal muscle function? You know, where do you see going from there?

Linda Marban: Yeah, that’s exactly right. Hi. Nice to chat with you again. So, you know, we’re in a really unique and quite favorable position in that way. We have a fully enrolled phase 3 trial, the indication for which is skeletal muscle dysfunction, particularly in the non-ambulant patients, is measured by the performance of the upper limb. So a different indication than the cardiomyopathy. If in the unexpected circumstance they issue a CR for whatever reason in August, we just turn around and submit the data for the HOPE-3 trial, which we expect to be positive based on three positive clinical trials proceeding, and just go after the skeletal muscle indication. And the secondary endpoints for HOPE-3 are the same cardiac ones that we’ve applied for, so we would just apply for cardiac and skeletal based on that. It’s a randomized double-blind placebo-controlled trial, and certainly would support any of the findings that we’ve already submitted on.

Catherine Novack: Got it. So you would intend to submit for both if you were filing with HOPE-3 data?

Linda Marban: Yeah. I mean, I’m expecting that the data would be reflective of what we’ve seen so far. We have done blinded assessments of the HOPE-3 data compared to the HOPE-2 data, and the distribution charts look almost identical. They can overlay each other. So I feel very confident that we would see similar results in HOPE-3 than we saw in HOPE-2. And I haven’t seen, there’s no way to preview blinded data for cardiac, and so we expect that to be positive as well based on the MRI data we’ve seen in all our trials.

Catherine Novack: Great. And then if you could share any specific feedback FDA has given you about LVF as a surrogate endpoint, you know, what have they said about this endpoint, the ability to predict cardiac outcomes? How much of that are you supporting with your OLE data? Thanks.

Linda Marban: Yeah. So I actually read some of this in one of your notes, so I think it’s an important point to highlight. FDA has stated that they’re not looking at ejection fraction as a surrogate endpoint in this specific situation, rare disease DMD. That’s why they funded the study with John Soslow by the Office of Orphan Products, co-funded with the NHLBI, was to determine what measures they could conclude to be outcome measures in a rare disease. In a rare pediatric disease, you cannot do an outcome measure like mortality. It’s not going to happen. So you have to be able to find other measures that are analogous to those outcomes of mortality or some other type of hospitalization, other types of standard cardiac measurements of progression of disease and use those.

And so Dr. Soslow published in the Journal of Circulation Heart Failure in 2023, this beautiful study with the Natural History data that we were then able to use on a patient level in a propensity-matched way to show that the ejection fraction in treated patients with deramiocel was significantly improved over what would be expected in Natural History. Real-world evidence has been stated by FDA and has been put forth in guidances as well as in a new office in CDER that emphasizes looking at the actual progression of a disease, real-world evidence, and able to use that analogous to a clinical trial dataset to make sure that efficacy is effectively analyzed. So we are in the really nice position of having good efficacy data of our own that we can compare to a Natural History dataset in an objective measure, which is cardiac MRI, of disease progression.

And so overall, we don’t look at ejection fraction, nor does the FDA in this situation, as a surrogate measure, but rather an outcome measure.

Catherine Novack: Got it. Thanks for clarifying that for me. That was very helpful.

Linda Marban: No problem.

Operator: Our next question comes from the line of Aydin Huseynov from Ladenburg. Your line is open.

Aydin Huseynov: Hi. Good afternoon, Linda and A.J. Congrats for the quarter. Thank you for taking questions. I got a couple. So given the sort of general pressure on all gene and cell therapy companies recently, and especially in those sort of treatments that were approved conditionally for almost a decade, never got confirmatory studies, do you think a full approval would put it into some kind of specific position when it can actually be utilized more than exon skippers or AAV gene therapies?

Linda Marban: Yeah. So I really can’t comment on that specifically. We certainly would be in a good position with full approval. We have highlighted in our biologic license application, and the community is well aware that we see both skeletal and cardiac benefit. So it’s possible that physicians would use it with both in mind. The patient population that typically have cardiac dysfunction that would be starting out on deramiocel probably already have implications of skeletal muscle dysfunction that would make them eligible to benefit from deramiocel. So that remains to be seen how FDA puts forth the label where we have applied for full approval, and we’ll provide updates when we have our label discussions later this summer. They’re already scheduled.

Aydin Huseynov: Appreciate that. And for the HOPE-3 data, could you remind us again when do you plan to disclose that? I mean, irrespective of what’s going to happen in August. And if you get approved based on HOPE-2, how do you think the label is going to change hypothetically once you disclose HOPE-3 data and ask for a label expansion?

Linda Marban: Yeah, so we’re in a really great position, as I said a minute ago with HOPE-3. Our current plans are somewhat fluid. We’re making sure that everything proceeds as planned with this application for the cardiomyopathy. If it does, which we fully expect it to, then our plans are to take HOPE-3 to Europe and potentially to Japan to be able to expand our label globally, as we’ve talked about. That would mean that we would keep HOPE-3 blinded, add more patients from the appropriate geographic area, and unblind it when those patients have reached their timeline for their primary efficacy endpoint, which would be a year after enrolling into the study. So that would change the unveiling of the HOPE-3 data. If for some reason, as the previous questioner just asked, there was some reason that we needed to move very quickly towards unblinding the HOPE-3 data, it would be likely in the third quarter, early fourth quarter of this year, and we would then be able to expand the label in that way.

Either in terms of skeletal muscle implications, right now the primary efficacy endpoint is the performance of the upper limb 2.0. We have had preliminary discussions with the FDA, although they were in 2024, that we would ask for approval for full DMD as opposed to all skeletal muscle myopathies, down to diagnosis, but we have not had full labeling discussions with them, nor have we finalized our plans on how that indication would look, but it would be for skeletal muscle myopathy.

Aydin Huseynov: Thank you. Thank you, Linda. Very helpful. And the final question is regarding the PRV voucher that you may be eligible to receive in August or September. So would you plan to sell it right away and get whatever the last price is, I think $155 million, or would you like to keep it for possibly using for some indications on your own, such as Becker Muscle Dystrophy?

Linda Marban: Yeah, our current plan is to sell it. It will really strengthen our balance sheet, and we feel that any indications that have come along, we probably wouldn’t need a PRV, we’d get probably priority review anyway for a rare disease. So I don’t think that would be as helpful to us as the dollars in our bank account.

Aydin Huseynov: Okay. Thank you. Thanks so much.

Linda Marban: Thanks, Aydin.

Operator: [Operator Instructions] Our next question comes from the line of Boobalan Pachaiyappan from ROTH Capital. Your line is open.

Maanasa Sangeetha: Hi. My name is Maanasa, and I’m dialing in for Boobalan. So congrats on your progress, team. And we have a few questions. First, in your payout market research studies, have the participants indicated the type of profile that you know would make deramiocel best in indication?

Linda Marban: I’m sorry. So are you asking which patients would do best on deramiocel?

Maanasa Sangeetha: Yeah. Like, have the participants indicated the type of, you know, the profile that would, like, what their preference would be? Yeah, that’s what I’m trying to ask.

Linda Marban: Yeah, yeah. So right now what we are looking for on the label is either the presence of LGE, which is late gadolinium enhancement, or scar in the heart, as measured by MRI. Sometimes you can get that very, very young in age, and the kids don’t know it. Their sort of ignorance is bliss in terms of the damage to their heart. But they need to start on deramiocel so that we can attenuate that progression. And or the presence of cardiac dysfunction, which would be measured by an ejection fraction of 55% or less, which could be measured in any way, whether by MRI or by echo. So the presence of either or both of those situations would allow for the prescribing of deramiocel, at least in its first iterations.

Maanasa Sangeetha: Okay. And the next question is, like, can you provide some color on the progress achieved with the Japanese regulators?

Linda Marban: Yeah, so we’re just working with the Japanese regulators now. We’ve actually been in conversations with them for a couple of years. They knew that we were waiting for FDA approval before proceeding in Japan. We have some upcoming meetings with the CRO that we’re working with in Japan. It’s a very well-known one called CMIC. And then we’re planning to have PMGA meetings either later this year or early next year as we plan on propelling deramiocel forward in Japan. While we have some ideas of what’s going to be required, which does not look like it’s going to be too difficult to achieve, I don’t have specific information to disclose yet on Japan. But we’re actively working on that now.

Maanasa Sangeetha: Okay. Okay. Thank you. And the last question is, can you kind of, speak about the adcom’s — like, can you speak to the adcom’s committee composition and expertise? And do you regard the adcom’s a positive indicator?

Linda Marban: Yeah, so the components or the participants or panelists of the adcom is available online. I don’t have it in front of me right now, but you can find it. It’s the Cell and Gene Therapy Advisory Committee Board. They select from there, and then they’re allowed to put ad hoc members onto the adcom. Obviously, we don’t know who those are yet. We don’t have a date yet for adcom, but we are practicing regularly. The company that we’re working with brings in panelists that have curriculum details or resumes that are very similar to the panelists so that they can ask and answer questions for us and with us so that we are well prepared, and we feel really good about it.

Maanasa Sangeetha: Okay. Thank you so much, and congratulations again on your progress.

Linda Marban: Thank you so much.

Operator: I will now turn the call back to Capricor Management for final thoughts.

Linda Marban: Thank you so much for joining today’s quarterly call. We look forward to updating you on our progress. Obviously, there’s going to be a lot of it over the coming months, and we will definitely keep you informed as we move forward. Operator, you may now disconnect.

Operator: This concludes today’s conference. Thank you for participating. You may now disconnect.