Nasrat Hakim - President and CEO Carter J. Ward - Chief Financial Officer Doug Plassche - Executive Vice President, Operations

Good morning, ladies and gentlemen. And welcome to the Elite Pharmaceuticals Conference Call. At this time all lines have been placed on a listen-only mode and we will open the floor for your questions and comments following the main presentation. (Operator Instructions). Before management begins speaking the company has the following statements. This conference contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including those related to the effects, if any, on future results, performance or other expectations that may have some correlation to the subject matter of this conference call. Readers are cautioned that such forward-looking statements involve risks and uncertainties, including without limitation, its ability to obtain FDA approval of the transfers of the ANDAs or the timing of such approval process, delays, uncertainties, inability to obtain necessary ingredients and other factors not under the control of Elite, which may cause actual results, performance or achievements of Elite to be materially different from the results, performance or other expectations that may be implied by these forward-looking statements. These risks and other factors, including without limitation, the company’s ability to obtain sufficient funding under the LPC Agreement or from other sources, the timing or results of pending and future clinical trials, regulatory reviews and approvals by the Food and Drug Administration and other regulatory authorities, intellectual property protections and defenses, and the company’s ability to operate as an going concern, are discussed in Elite's filings with the Securities and Exchange Commission, including its reports on Forms 10-K, 10-Q and 8-K. Elite undertakes no obligation to update any of these forward-looking statements. With that covered it is now my pleasure to turn the floor over to your host, to Mr. Nasrat Hakim, President and Chief Executive Officer of Elite Pharmaceuticals. Sir, the floor is yours.

Thank you, Dave. Good afternoon, ladies and gentlemen. My name is Nasrat Hakim. I am Elite's President and CEO. The primary purpose of this call is to update you on our financials for the fiscal year ending in March 31, 2014. However, we will take this opportunity to update you on our progress and accomplishments to-date. We'll start with an update from our Chief Financial Officer, Carter Ward, followed by a site status update from our EVP of Operations, Doug Plassche, after which I will update you in general manner and followed by a Q&A. Mr. Ward, you have the floor. Carter J. Ward: Thank you, Nasrat and thank you to everybody calling in today. Yesterday, we filed our 10-K for the fiscal year ended March 31, 2014. Financials are available online at elitepharma.com as well as sec.gov and all the usual other sites like Google, Yahoo!, MSN Money, OTC Markets; hopefully most of you have had a chance to review them by now. I would like to spend a few minutes going over some of the more important aspects of our financials. Today I am going to start with something that I have not mentioned before. We've gotten a couple of questions and comments since yesterday, so I thought I would start with this area and that would be the audit opinion. For the first time since 2002 the opinion of our independent auditors did not include a modification, referencing doubts as to Elite's ability to operate as a going concern. Some of you have noticed; don't discount the importance of this. To achieve this type of clean opinion from our auditors management has to not only assert that Elite is able to operate as a going concern but we also must demonstrate to the auditors this assertion and the auditors scrutinize and test this assertion as well. There are objective measurements such as cash, working capital, liabilities and operating costs as-well-as subjective measurements such as forecast and business plans that are all taken into consideration. Very conservative standards are applied and for the first time in 12 years we've passed the test to be considered as a growing concern without doubt and without qualifications. This is a significant hurdle which must be cleared by any company that is turning itself around and we did it this year. Next, let's look at our balance sheet and specifically working capital. At March 31, we had cash of little less than $7 million and a working capital surplus of almost $3.8 million. This is our first working capital surplus in five years. Please note that as in prior year’s working capital includes as a current liability the full 3.4 million bond liability. Subsequent to March 31 we monetized our investment in Novel, received $5 million for an investment that had a book value of $3.3 million. This further enhances our working capital position. Our March 31 balance sheet is by far the strongest one that I have reported in my five years as Elite's CFO and it's likely the strongest balance sheet in Elite's history. The working capital surpluses, strong liquidity is not something to just be admired. They need to be put to work and that's what's happening here. The most important use of this working capital is to fund the ongoing development of a line of abuse-resistant opioids based on our patents and our pharmacological technology. We spent $4 million on R&D in fiscal 2014. That's quadruple the $1 million that we spent the prior year. These costs will continue and they will increase as our development activities increase and accelerate. Nasrat will have a lot more to say on this but we've already passed one bio-equivalent study, we've initiated another, we have human trials in process, product development activities are ongoing and they are increasing and we're expecting to file our first abuse-resistant opioid product by the end of this year. In addition we've been investing in the expansion and upgrade of our manufacturing facilities. During fiscal 2014 we invested more than $500,000 in our facility and we continue to spend to upgrade and improve the facility. Product development and commercialization require more than just technology and patents and successful trials and FDA approvals. We also need to manufacture on the scale and at the efficiencies required to be a leader in such a large market. Doug Plassche will have more to say on our facility and Nasrat will talk about the product development, but from a finance viewpoint please note that these are all big ticket items. We've a strong working capital position which has been enhanced by the $5 million received for the Novel investment as-well-as the $40 million equity line with Lincoln Park Capital. Our goal is to be a leader in the abuse-resistant opioid market and financially we have sufficient resources to support the plans in place to achieve this goal. Another use of our working capital concerns our bonds. We've started the process of getting current on the New Jersey Economic Development Bonds and carrying the defaults. We’re approximately $1 million arrears, inclusive of principal and interest payments due. There is a process that must be followed and we've given the required notice and we're ready to make the payment once the bond trustee instructs us to do so. So the process is in place now and we expect to have the bond arrears cleared up by the end of this month, by the end of July. In addition we've sent notice of our intention of making the principal and interest payments which are due on September 1st. We're going to make them on time and in accordance with the law [indenture]. That's something we haven't done in more than five years. Our intention is to cure the bond defaults as quickly as possible. We're following the required process. We'll make the payments on time; the lawyers are doing what they need to do and we expect to finally remove this cloud of default which has hung over our head for more than five years. So to recap our balance sheet; we're on the strongest financial position on record and we're utilizing these resources to develop and commercialize our abuse-resistant technology, to expand and upgrade our facility and to cure the bond default. Now moving on to the income statement, there is two areas I'd like to highlight. First, as always is our revenues. Revenues for fiscal 2014 were $4.6 million, a 35% increase, or $1.2 million above the prior year’s revenue of $3.4 million. It's now two years in a row in which we've increased revenues by more than a $1 million. During fiscal 2014 we launched three new generic products, we acquired 12 approved ANDAs. These all began contributing to revenues this year. Our other generic products have been on the market for between one and three years and all of them have seen strong growth. The net result was a 35% increase in revenues and in expanding and growing foundation of commercial generic revenue streams which will provide further stability to Elite operating as a growing concern in the future. Lastly I feel compelled to comment on the derivative expense line items on our P&L statement. Most of the items labeled as change in fair value of warrants, change in fair value of preferred stock and convertible notes. Together they totaled $90 million in expenses. For the past four years accounting rules require us to report our preferred stock, warrants and convertible notes as liabilities and not as equities as some of them used to have been recorded and we value these liabilities at a price that's essentially based upon the price of our ELTP stock. What this means is it results in expenses recorded when our stock price goes up and revenues being recorded when our stock price goes down. While our stock had very good year in fiscal 2014 we went from less than $0.08 in March of 2013 to $0.41 as of March 2014. Everybody is happy about that and we're doing all we can to add even more value to Elite but when this happens it meant we had to book $90 million in expenses. And please note these expenses will never, never require any payments of cash and if the stock price goes down and we have to record revenues we will also never receive any payments in cash. These are all just book entries. Finally I want to say that today marks my fifth Anniversary as Elite's CFO. I started July 1st five years ago today. The difference between today and my first day at Elite could not be any greater. Five years ago I joined an Elite that had 11 employees with a directive to manage scant resources to ensure continued operations, to manage the bond default as best as I could and be the finance part of a management team tasked with commercializing our groundbreaking technology. Now five years later there aren't 11 of us, there is 39 of us. We've have a working capital surplus, resolution of the bond default is within our grasp and the entire Elite team led by Nasrat Hakim is on schedule to file our first abuse-resistant product this year with more to follow. Fiscal 2014 has truly been the year of Elite's turnaround. Can't believe it's been five years but it has been time well spent. Now our Executive Vice President, Mr. Douglas Plassche will give an operations update. Doug?

Good afternoon. I will be briefer than Carter. Since my last update in February we've continued to focus on improving really all areas of operations, production, laboratory facilities, equipment to support both the commercial and the R&D business. A few highlights on the production side; new encapsulator, new checkweighers, new tablet press and a high shear granulator dryer that is just been put on order. So lot of activity; all these items require qualification and start up. So it hasn't been an easy task. Along with these upgrades security and GMP upgrades have been completed in all of the facilities. These two combined leading to overall quality and efficiency improvements in the entire operation. Specific laboratory upgrades, UPLCs, additional dissolution beds to manage all of the testing that comes from all of the ART technology and we also are trying to upgrade the infrastructure by going with a quality system and a material's management systems that are just being implemented now which will allow us to build our infrastructure and support the increased complexity in volume that we expect in the future. We're also actively exploring commercial manufacturing options for the ART product, given the potential for some of these products, the volumes will be quite large and we obviously will need a commercial side for that. Specifically on the R&D front we've been progressing through what I call Nasrat's magic list of new formulations, designing and executing studies, finalizing formulations and processes to meet the clinical and submission dates. We have hired two additional R&D technicians and two additional laboratory personnel, one of which is a method development scientist, all focused on bringing the ART technology to submission. This work along with all of the support materials to help support the NDA filing have kept the R&D group very busy. Overall operations is evolving to meet the growing requirements of the company and is ready to deliver the targeted results. That's all I had.

Thank you, Doug. Good afternoon again ladies and gentlemen. I'll start with few comments on Elite's financials. Then I'll update you on Elite's clinical trials and then on the genetic products. Since I jointed Elite our financial stability has improved greatly. Previously due to losses and limited cash Elite was required to be listed as going concern, as Carter stated. Elite is no longer listed as such and our balance sheet is very strong. That is due to several factors, including our revenues that are coming from our products are up and they are higher than ever been before; a nice $5 million cash infusion from the Novel agreement and our Lincoln Park deal. We already announced the Novel agreement. Our investment in Novel was initially 9.8%. The day we settled it was 3.55% due to dilution that the company issued to the stockholders, to management, to the employees. So when we received the $5 million in exchange for our shares we thought definitely that is a fair value. It's a fair price and more importantly this money is most valuable when we invested into development and commercialization of Elite abuse-deterrent products. This is why I have pushed for this deal from day one and I am very happy that it is concluded. A comment on the bond, Elite has always paid the interest on the bond. We were in default with the principal and now we have reached out and we have been working with Carter and the lawyers to reach out to the trustee to pay what we are late on which is in the neighborhood of about $1 million. This has been a top priority of mine from day one. We've initiated the process to make our bond current, for the building on 165 and we will be successful very soon, based on the process that the bank and the lawyers set it may take us few months. We're hoping to conclude this by the end of the summer or shortly thereafter. Our clinical trials have been going very well. We have a lot of active projects going on, I'll update you on three of them. We continue to make tremendous progress in the development of the abuse-resistant technology. For our first product ELI-200 the first key clinical study and a DE study, ADE study has been successfully completed. Afterwards the IND was filed. We received feedback from FDA on our IND because we submitted with several questions. The second part is the second clinical study for human abuse liability study. This was initiated earlier this month and will be underway. The results of this study will be available this fall. Let me pause here for a second to walk you through the timeline. Even though we just initiated the dosing this project has been actively going on since last March. In order for us to move forward with human anti-abuse studies we had to first file the IND, wait 30 days, give the FDA 30 days to make sure they responded. After that we had to write protocols get narcotics across the Board to Canada where we were conducting the study. Get them to write a protocol there, submitted to their regulatory agency similar to the FDA, get feedback from them, send it also to our FDA make sure the patients are -- as subjects are protected and then finally get to the dosing. So this process has been going on for months right now. We say it was initiated now because the dosing started now. The third part of this study is the in-vitro laboratory study. That is a category 1 FDA requirement and that is also an extremely important process. We received comments from the FDA on how we should proceed or which part we should cover in this study. We contracted with an entity, with a consulting firm that works very closely with FDA and has lot of experience on this subject. They are writing the protocol that we’re executing and working with us on weekly if not daily basis. We've hired a scientist who is dedicated to help us out internally. We’re doing some of the testing and a consultant that is doing the same. We hope that the results will be available also by early fall. We're on track to file by year's end, again barring no more FDA requirements. The FDA has been very positive in the comments they've sent us but definitely at the end of the day when they see the totality of everything they will make the final decision. For our second product, ELI-202 the first key clinical study is underway, final results are not now available but I am hoping that will be there for our next Investor call. We also initiated the in-vitro lab study that I just described where we do all the testing in laboratories to see if people who are using chemicals abuse our product or what are the limitations of our product in case somebody intended to abuse it. This for ELI-202 is also ongoing and hopefully we'll have results for that by this fall. For our third product, an extended release Oxy, Elite completed the successful pilot in December and I'll update you on the next step in our next conference call. I continue to talk to several potential partners and licenses. There is tremendously high interest out there in our company and in our products. As I have discussed before we will wait for the right time and for the right partner. The further Elite takes this product on her own the higher the value to the stockholders will be. Our genetic products are moving forward; I will first start my update with the Mikah product, Isradipine. We received feedback from FDA on Isradipine. We're going to manufacture a free validation lot for each of the strength before we move forward and release the product which is standard in the industry. The FDA has been kind. We had a meeting with the center and from that end we have no issues. All our issue has been with the API. Due to the PDUFA fees they requested that we pay their fees in order for them to make our product. Then they requested that we pay them for the raw material that goes into making the raw material for us. And then they requested that we buy the entire lot in one package for them to make profit. Considering that they are the only ones that are filed in our application we had to do all of this and that caused some delays. We are now ready to move forward and make the validation loss and we are hoping to launch later this summer or early fall. ELTP is progressing very nicely on their product in Hydroxyzine, has already been manufactured and placed on stability. Dantrolene, they are also working on that; on Loxapine they are in negotiations with an API supplier. Finally I started talking about financials, I'll end talking about financials. The Lincoln Park equity line of credit has been excellent for us. The first one set the stage for us to raise enough money to do all the clinical we're talking about right now. And the second one we have not tapped too much into for two simple reasons really. One because the stock price is not that high, we think it could be better. And two or more importantly it is because we have enough cash at this time that we don't need to dilute the shareholders any longer. We are open for questions.

Okay, thank you very much, ladies and gentlemen. The floor is now open for questions. (Operator Instructions). Okay, we'll take our first question from [Drew Brady]. Your line is live.

Hi, great job guys. Thanks for all the hard work and the commitment. Speaking of commitments I got a question about the commitments shares. I understand there has been 1.9 million issued to Lincoln Park, is that correct? Carter J. Ward: The initial commitment shares, yeah that sounds about right.

Is this -- help me understand what this is, is this basically a de facto transaction fee? Carter J. Ward: Yeah well it's part of the equity line facility. We have when we signed the deal there is half of the commitment shares are paid, that’s the 1.9 million. And the other half of the commitment shares are paid as and when and if we draw down against the $40 million, proportionately against the $40 million.

The full 40 or…? Carter J. Ward: Yeah I mean if we draw down less than the $40 million we will not fully issue the commitment shares.

The second payment of the commitment shares? Carter J. Ward: Yeah, well the second payment is really a proportional issuance of commitment shares proportional as and when we draw down against the $40 million.

Okay. And what is the cost, is that at the share prices at the time of issue, is that correct? Carter J. Ward: Yeah well there is a calculation but it's essentially that. There is a calculation, there is two types of drawdown and the first is call regular drawdown, regular tranche, a regular purchase actually and that's based upon the lower of the price on the trading price on that specific day or the average of the last of the three lowest closing prices within the last 10 days.

Okay. Carter J. Ward: Okay. And then there is an accelerated draw down which is of the [WAP] based calculation.

Okay, all right. Thanks that's all I got. Appreciate it, thank you. Carter J. Ward: Okay. You're welcome Drew, take care.

All right.

Okay. We'll take our next question from [Robert Parker]. Your line is live.

Thank you, gentlemen and thank you Hakim again. Just a quick question; how many ART products can ELTP get to market without a partner?

That's a very tough question because of the different ART products some of them you could make, you could get several with that and some you can only get two. The testing and requirements from FDA for each different ART is different and the more clinical trials you conduct, the more money you spend. So I would say for the money we have right now for the product you're selecting we probably can get five easy.

Great, can I ask one more, this is kind of sidebar, do you have any thoughts on Embeda failure to re-launch by the second quarter and from that how much extra revenue that Elite could garner, if Pfizer can get stable Embeda on the market?

I think that Pfizer will be launching it within the coming month or so.

Okay.

They are working very hard on it and they'll get there, whether it's going to be a successful launch or not I don't know but definitely the product will be available in about a month or so.

Okay. All right. Thank you sir and again, the team, great job.

Thank you, Robert.

We will take our next question from [Charles Youngblood]. Your line is live.

Hello, thanks for taking my call. I want to clarify a couple of things; in terms of revenues, this latest quarter when you break it down it looks like it was about $1.1 million revenue for the fourth quarter which was less than year-over-year and quarter-over-quarter. I thought there was something that had been passed on that there weren't any milestone payments in this quarter, is that correct? Is that why there is disparity there? It was lower than the year-over-year and quarter-over-quarter and I was wondering what accounted for that. Carter J. Ward: Well that's exactly it, we had milestone payments related to the transaction we did with Epic, which was in the prior quarter, in the quarter ended December. That was $600,000 milestone. So that's really the -- that's the milestone so it didn't repeat itself during this quarter. That would be the biggest thing.

Okay. Will there be any milestone payments in the future? Carter J. Ward: Within the Epic agreement as we file and launch the products that are in the Epic agreement, there are milestone payments attached to those.

Okay. And there was something that came out today this is separate question I was wondering if I could ask about this, with the Lincoln, the authorization for the 108 million shares, can you -- given all our, all the information that was in this latest PR regarding our financial condition. I was just curious about the reason for that because I think you just talked about not wanting to dilute. And I was just wondering how fast the shares are going to come to market and if the financial condition is that good why are they doing that at this time?

I am not sure, I understood what the question is but I am going to guess that you are saying why would we tap into the 108 million shares if we have enough money, right?

Correct.

Okay. Well because we do have enough money to follow up with an odd product or two when you are talking about ANDAs they cost a lot of money. So let me give you a simple example, the human anti-abuse trials that I described earlier for each product it's in the millions of dollars. So if we want to go to the market with only one or two products I can stop right now and we will not have to tap into the Lincoln Park deal. But if we want to proceed and create a real company where you have product in the market and you have a pipeline that's worth a lot to the stockholders so in case if we [immerse] with somebody, go to the next level the value will be 10 times more, then it's our choice to do that and we're choosing to build more equity into the company by converting some stocks. So let me give you a simple example here on how I think. Let us assume this 100 million shares that we divest or dilute everybody with are for let say a 1,995 million so the total dilution let's say would be 10%.When you take 10% of your value and switch it into equity that's going to compete in a market of $10 billion. To me the return on investment is huge, it's a foregone conclusion that we have to do it.

Okay. Thank you, gentlemen for taking my call.

Thank you, Charles.

Thank you. We will take our next question from [inaudible]. Your line is live.

Hello.

Hello, yes.

Thanks everyone for a great job. Few questions I actually have. Like I see on our product line, almost over a year I see we have two undisclosed generic pending FDA approval. Is there any more details you can share with us, that's over a year? I am not sure when actually we filed them but they are on the Elite ANDA and there are undisclosed generics?

Yeah, this is the problem and that's a very good question. I am going to take a look at that. I think that we have a coupled effect is that the FDA takes forever or has historically taken forever to get a generic application through. It takes more than three years. Hopefully with the PDUFA coming in they claim it's going to be about a year but this has been on the books for a while. We will discuss it among the staff. I am not sure why we have not disclosed them because they are generic. We will address that for the next conference call.

Okay, can I ask another question here?

Please.

Regarding to your ADT technology that we have, who else in the market you think would be our major competitor for developing ADT opioid drugs in the pharmaceutical industry?

Very few, top of the line is Purdue and Pfizer.

Okay. Thanks a lot. And great job again and I appreciate that.

Thank you. Carter J. Ward: Bye-bye.

And we will take our next question from [Justin Subinski]. Your line is live.

Thanks guys. Long time [inaudible] call. [inaudible]

Justin we're having trouble hearing you. Can you speak up please? Say it again.

I am trying to find out if there is any planned future [inaudible] for any investor awareness campaigns keeping the stock at its fair price [inaudible].

Yes there is. We have not focused on that yet because we have been busy trying to get our technology to clinical trials and all of that. Now that we're going all the positive results that we've been, it is time for us to hit the road. We will Rodman and we will see where we go from there. I get calls from T.V shows all the time that they want to feature us on this and that. And honestly even though it will be good for us but it is it a little bit of distraction. Once I have a solid product to file then we will hit the road and start the campaign to start to get everybody's attention to the great products we have.

All right. Thanks.

And we will take our next question from [Ronald Gilbert]. Your line is live.

Hi. I was wondering on the route ahead to add more stock for the company, how many more stocks did they add and how does that affect the stock price? Carter J. Ward: Well, I mean we had 690 million previously and now we have 995 million so we increased by around 300 million shares in authorized. And our stock has been pretty stable since that was in May when that happened and don't know exactly how we fluctuated but we've been right around that $0.40 to $0.42 mark pretty consistently.

And but all it is to me is when you -- share is -- forms of equity. When we sell stocks and take that money and invest it into the company's development and pipelines that improves the value of the company more so than sitting on the stocks at a stock price of $0.068 which it was when I joined the company. The more you put into a company, the more valuable it becomes.

Well I am not just looking at it as a total pie, when you add more stocks you ought to send those down, I mean which like the stocks are owned they have to go down even though the stock price didn't go down. Actually when you add more shares in something has to give. I mean why don’t we do a reverse stock split or some kind of stock split. I don't know how you add more shares to a corporation without affecting the price.

Well, that's a longer discussion. First I am not going to have a stock split because the fundamentals does not support it right now. We will either organically grow back on to a NASDAQ or a major stock exchange or when we have fundamentals we’ll revisit whether we're going to have some kind of a stock reverse split. At this time I have no intention of looking at any of that. My focus is to get the products through the FDA, build some equity into this company and then evaluate the value of the company at that point.

Naturally but I was just wondering as you added the stocks in did your corporation buy them stocks or that was just thrown in, I mean actually…?

No, we did not through anything into the market. These are authorized. The stockholders were kind enough and intelligent enough to give us the authority. In case if any of our products could make a lot more money than the stock price we will go ahead and sell some stocks to raise money to execute on our plan. We have not sold any of that, they are only authorized. Carter J. Ward: Yeah, Ronald, though as of June 20th we have 568 million shares issued and outstanding. So that's more than 100 million less than what we previously had authorized. So what was…?

As we open up, I mean the stock has been falling now for about three years. I wish I would have gotten [inaudible] I would have made about $90,000 [ph]. I got in at like 38. But I am still going all right. But I was just concerned if they added more stock in who paid for the stocks, but it is on reserved… Carter J. Ward: They are authorized but not yet issued. We are 568 million actually issued shares.

So if they would come in to the market that should make our price go down.

No, not necessarily. When you have a company, Pfizer has 10 times more stock than we do and their price is very high. It is not about how many shares you have out there only it's about the totality of it. What kind of a pipeline do you have, how many products do you have in the market or you're going to the market with, all of these are factors in the stock price. When you are commercial the fundamentals or the [inaudible] ratio, the earnings per share and so on, there is so much more than just a number of shares.

And I am just looking at it as a whole pie and you add and make it a bigger pie, the market cap would decrease as the pie got bigger but if the pie got smaller market cap would increase, that’s how I was looking at it as.

Yeah, that's one way to look at it but believe me that's not the only factor. That’s a very small factor in the big picture.

Okay. Thank you. Carter J. Ward: Thank you.

We'll take the next question from [Markovich]. Your line is live.

Good morning gentlemen. How are you today?

Very good, Mark, welcome.

Thank you. I just want to say congratulations on a great year for team Elite and as a private investor that's been with the company for five years, we certainly appreciate all the hard work and effort that team leaders are putting in for investors and increasing shareholder value for us.

Thank you.

And that being said, with everything positive Elite has going on and I mean everything is pointing in the right direction now. I mean you’ve covered the debt issues, the bonds and everything and the ART products moving forward, I mean we are as positive as I had ever seen it. The independent valuation of the company put the stock price at a median of $2.10 a share with a high of $2.75 based on the current generic line which is even ever increasing right now with the Mikah products. Why do you guys think we are stuck in this penny land right now as supposed to dollar land?

Very good question and if you figure out why please let me know. There are a lot of factors for that. We're talking about historically Elite did not perform on a technology they’ve had for over 10 years. So some of the stockholders have gone a little shy. Me personally before I even joined the company from day one I told you all in my very first meeting when the stock was only $0.07 or $0.068, if we were an R&D company with what I’ve seen today the stock should jump tenfold, ten times and I still stand by that. I think we have a great company, I think our stock is undervalued but maybe I am biased because I see exactly what we have and I see the potential for the market. I see what the Congress is asking for, I see what the [ST] is asking for, and I see the number of dollars that are associated with this segment that we are in or a part of. There is a lot of money to be made in the future and when people see that I think the stock price is going to adjust accordingly.

Thank you for that. Do you feel and just maybe a gut feeling that there is some type of adverse manipulation on the stock price right now that's kind of trying to hold us in this pattern for whatever reasons?

I have shied away from ever talking about that. I do get from my Investor Relations head and other people some emails about people bashing the company, that hang around online at 3 o'clock in the afternoon and 3 in the morning and somehow they dedicate their lives to doing this and it's hard to believe that the person has that kind of time unless they have been paid for it. So is it true? I really don't know. What I tell you is this they will not stop us. Nobody can stop us. We're moving forward, we're going to get our end point. The FDA may come up with something that will ask for couple of more tests here and they will delay us by few months. But there is nobody who is going to stop us. We're going into the anti-abuse land within the year or two at the very most.

Okay, great and thank you much for your time and your continued effort on behalf of the shareholders. Have a great day guys.

Thank you. Carter J. Ward: Thank you, Mark.

Okay, we take our next question from [Michael Watt]. Your line is live.

Hey guys. I have been an investor since 2011 and you have made tremendous progress I think that's obvious to everybody here. My question and it may have been answered before but when will we know if any efficacy trials are required to bring out these first few products. Are you meeting with FDA to determine this or when will that be known?

Excellent question and of course that's one of the main questions I have got on my mind. We have submitted an IND to the FDA. They came back with an analysis, they didn't say you have to run efficacy trials but again they are waiting for us to submit all the data for them to make a final decision. Our feeling is that it's not going to be needed, at the end of the day FDA’s ruling is the law of the land and we have to do what they ask. The final answer will be delivered to us I believe when we meet them face to face, we're hoping for October. We're trying to set up a date so that we can meet them present all our case and say we believe we have everything. We have got anti-abuse lab and human we’ve got the DA trials, we have the history, we have all of this for you, what's your verdict and I am hoping then they will tell us you need one more trial or not and I am hoping for the not.

Awesome, and just if one more question if I may. So just to clarify at some point hopefully this year I mean that what was said earlier that we will be completely be -- the bond issue will be completely removed and also do you think that maybe part of the reason that our stock, while has increased lately, it's still not around the valuation of the $2 mark?

That probably is a factor. Anytime that you have to issue in your financials since I believe third quarter 2002 you have to -- issue that you have a growing concern that's scares some investors. And that's why that was one of the number one priorities on my list is to tackle that issue and this is not publicly known and I know that is a confidential information but I tried to actually pay for that myself and the lawyers said no because if I paid for it then stocks it looks like I am selling stocks and the stockholders will freak out so we are paying for it in cash. But that is one of the -- or that could be one of the factors.

Okay. I think that's all I got. Appreciate it, keep it up.

Thank you, Michael.

Okay. We'll take our next question from [Markovich Dan]. Your line is live.

Thanks, good afternoon everyone.

Good afternoon.

I guess everyone is going to say great job but it really has been. Looking at the 10-K and just happened to notice the patents, there are two patents that are assigned to Celgene Corporation and I just I don't know that's probably been there for long time I've just never noticed that before. Could you comment on what areas those fall in and what the arrangement is? Carter J. Ward: Yes they were from a long time ago. There was development work done here for Celgene are for methylphenidate and they are owned by Celgene. We have some rights outside of methylphenidate itself but primarily they are focused on methylphenidate and that's -- and Celgene has the right to that piece of it.

I see and is that generating revenue now or was it one-time revenue? Carter J. Ward: There was some revenue associated with development projects but this was done long before anybody that’s with the company now was here. Certainly, the money was back at that time, not now.

Got it, got it. All right, thanks very much, appreciate it.

Thank you.

Okay. We'll take the next question from [Chris Keefer]. Your line is open.

Hello Nasrat and this is Chris and thank you and thank you all 49 employees really thank you for your hard work, it has been quite outstanding. Nasrat you mentioned something about partner, someone partnering with Elite. Can you -- are you kind of still like in contact with potential partners and what is it that you think might -- what is it that they look for that Elite doesn't just have at this point or you can't really talk about that because that's for obviously for competitive reasons or I guess I am fine with that but as far as someone partnering with Elite can you just speak of the obvious advantages of that I am just kind of curious about that?

Sure, I'll give a high level, obviously I can’t divulge a lot of things but I do believe that by this year's end we'll make a decision with the potential people we're talking to on what kind of a partnership or arrangement we will have with them. Anytime you go into the market with a partner these partners are going to demand something. They may pay for some of the clinical trials with someone upfront and they would want let's say 50% of the revenue later. When you are talking about $1 billion product, that's a high price to pay, it’s a very high price to pay. So, we have currently two very good options. And everybody of course wants the lion’s share if they want to join you before you have approval or a clear path from FDA that everything is going to be great. And we're now willing to pay that price. I am much more comfortable spending the money we've raised from our revenues, from the arrangements we have with Novel, from Lincoln Park because it has a lot lesser impact on the stockholders. I am much more comfortable going down that path building more and more value into these NDAs. Then I am to turn it over somebody else who would pay me a few million dollars now and then will have a lot more profit in the future. Both of the partners we’re talking about today, both of the two front runners I should say, both of them contacted me. I did not contact them as a matter of fact I didn't even know that they had any interest at this time. So there is a lot of interest out there and lot of people are calling. We need to prove this technology once and for all, get product to the FDA and after that when they see here is a product or two and the other 12 are coming that will seriously give our company value.

Okay. Thank you very much.

Thank you.

Keep up the good work and I am following closely. Carter J. Ward: Thank you, Chris, appreciate it.

Okay.

Thank you.

Bye-bye.

We'll take the next question from [Norman Damone]. Your line is live.

Oh, hello excuse me if this information is already available but I was curious as to what the initial dollar amount was for the Novel investment? Carter J. Ward: The initial dollar way back when I think we invested around $5 million with them. That was some years ago and but the book value there’s has been, there were dilutions and write-downs prior to 2009, I believe, so we were looking at a book value of around $3.3 million at the time of the transaction of the settlement.

So you were able to recoup basically the entire initial investment? Carter J. Ward: Yes.

Which sounds like a fairly decent, given all the dilution.

I got involved with this when I joined the company and I discussed this in length with Veerappan till we reach the conclusion we reached. My understanding is that we invested $5 million in Novel and then Veerappan and body decided that Veerappan should put in $2 million in stocks which they give him back and the $2 million in stocks after that the company went down to finished stock and Veerappan lost the $2 million. So I do believe initially it's like a five plus two and because the two went down to nothing it was five. Novel has been straight forward with us and they have sent us their taxes every year and all of that stuff. However, it's a privately held company and accordingly we were not getting a single penny in profit sharing or anything else. And at the end of the day the valuation of the company was a little tough. Veerappan is a very smart man, he owns Novel, he owns [Gavus], somebody else owns the building, he owns something in India and it got very complicated for us and for him to keep tabs on what's happening. So even though the value was about $3 million, he was kind enough to give us back our original investment of $5 million and we’ll part ways which we did.

That's sounds like a great result considering we need the cash right now. Carter J. Ward: Absolutely.

Best of luck and good wishes for the rest of the year ahead.

Thank you.

Okay. That was the last question we had in the queue for today.

Thank you ladies and gentlemen. It's always a pleasure to report good news. Thank you for your continuing support and we will talk to you around August 15th. Thank you very much.

Thank you very much ladies and gentlemen this concludes today's presentation. You may disconnect your lines and have a wonderful day. Thank you for participation.

Thank you, Dave.