Thank you, Rob. Good morning, everyone.

My name is Brent Larson, CFO of Navidea Biopharmaceuticals, and I will be moderating this morning's call. Before we get started, we would like to remind you that during the course of this call, management may make projections or other forward-looking remarks regarding future events or the future financial performance of the company.

It is important to note that such statements about Navidea's estimated or anticipated future results or other nonhistorical facts are forward-looking statements and reflect Navidea's current perspective on existing trends and information. Navidea disclaims any intent or obligation to update these forward-looking statements, and actual results may differ materially from Navidea's current expectations depending on a number of factors affecting Neoprobe's business -- Navidea's business, excuse me.

These factors include, among others, the inherent uncertainty associated with financial projections, timely and successful implementation of strategic initiatives, the difficulty of projecting the timing or outcome of product development efforts, and FDA or other regulatory agency approvals or actions, market acceptance and continued demand for Navidea's products, clinical and regulatory pathways, the impact of competitive pricing, patents or other intellectual property rights held by competitors, the availability and pricing of third-party source products and materials, successful compliance of government regulations and such other risks and uncertainties detailed in Navidea's periodic public filings on file with the Securities and Exchange Commission.

Now, I'd like to turn the call over to Dr. Mark Pykett, President and Chief Executive Officer of Navidea.

Mark?

Thank you, Brent. We appreciate the participation of everyone on today's call and look forward to sharing our business update and quarterly financial results.

During the first part of the call, I will provide an update on Lymphoseek, our AZD4694 [indiscernible], the option for the E-IACFT Parkinson's disease imaging agent and RIGScan. After my remarks, Tom will discuss business development and commercial activities, and Brent will review our first quarter financial results.

At the conclusion of our comments, we will address questions.

Overall, I'm pleased to report that we continue to make progress on every element of our development efforts. As we announced on April 3, we were notified by FDA on April 2 that the PDUFA date for Lymphoseek had been extended to September 10, 2012, a 90-day extension from the initial date of June 10.

Late in the Lymphoseek NDA review cycle, FDA had requested updated chemistry, manufacturing and control, or CMC, information related to an analytic assay, one of several analytic assays involved in the manufacture of Lymphoseek. We submitted the requested information on March 30.

As this was within the 90-day period before the PDUFA date, FDA elected, as it's its option, to extend the NDA evaluation by 90 days to complete a first-cycle review.

Neither this decision nor the NDA review to date has raised questions about Lymphoseek's safety or efficacy, or the design of the clinical trial supporting registration. The PDUFA date extension does not pertain to the company's ongoing head and neck cancer clinical trial or to our recently announced comparative analysis of Lymphoseek to sulfur colloid.

We, of course, will continue to support the NDA and to prepare for commercial launch in the U.S. with our marketing partner, Cardinal Health.

Also in April, we announced that Dr. Fred Cope, Senior Vice President of Pharmaceutical Research and Clinical Development, presented, for the first time, favorable findings from analyses comparing Lymphoseek to sulfur colloid at meetings of the Sentinel Node Oncology Foundation and the international Sentinel Lymph Node Working Group.

These analyses to used data from Lymphoseek's Phase III clinical trials in breast cancer patients compared to historical data on sulfur colloid filed with the FDA for its approval in breast cancer lymphatic mapping.

The analyses revealed that in these breast cancer cohorts, Lymphoseek's localization rate was 99.91% by meta-analysis and 98.65% by pool data analysis, whereas the sulfur colloid localization rate derived from peer-reviewed literature was 94.13%. These differences in localization rate in favor of Lymphoseek are highly statistically significant.

Full data on the comparison of Lymphoseek and sulfur colloid will be represented at ASCO in Chicago in June.

These observations build on prior data developed in our successful Phase III studies demonstrating the favorable performance of Lymphoseek compared to vital blue dye, another agent used in intraoperative lymphatic mapping. We also continue to make progress in our NEO3-06 Phase III clinical study in patients with head and neck cancer, in which the performance of Lymphoseek is being compared to a pathology truth standard.

We continue to believe it may be possible to reach an interim analysis point in this study by midyear, potentially providing important new data that could benefit our commercial efforts with Lymphoseek.

In March, our collaborator, Dr. Stephen Lai from the University of Texas, MD Anderson Cancer Center, presented a poster at the Society of Surgical Oncology Meeting, describing his center's experience with Lymphoseek in 9 patients with head and neck squamous cell carcinoma.

In these 9 patients, full node dissection led to an average of 40 lymph nodes being removed per patient. In contrast, in these patients, only 3.75 nodes on average were hot in which Lymphoseek had localized.

Although picking up substantially fewer lymph nodes than full node dissection, Lymphoseek exhibited a 0% false negative rate compared to the pathology standard in detecting patients whose lymph nodes contain cancer.

The results demonstrating a false negative rate of 0% compared with full nodal dissection reflect favorably on Lymphoseek. And yet in using Lymphoseek, substantially fewer lymph nodes can be removed.

This indicates that Lymphoseek may enable surgeons to reduce the need for more extensive lymph node dissection, potentially sparing patients from the morbidity and side effects associated with broader dissection, while achieving high accuracy in the detection of key predictive lymph nodes.

I would now like to discuss the progress on AZD4694, the small molecule PET imaging agent to aid in the diagnosis of Alzheimer's disease that we licensed from AstraZeneca last December. AZD4694 is a Fluorine-18 labeled precision radiopharmaceutical for use in the imaging and evaluation of patients with signs or symptoms of cognitive impairment such as Alzheimer's disease.

It binds the beta-amyloid deposits in the brain, which can then be imaged by PET scans. We believe that AZD4694 is a potential best-in-class, second-generation agent aimed at addressing pressing diagnostic disease -- needs in Alzheimer's disease and dementia.

AZD4694 appears to have strong sensitivity in detecting beta-amyloid. The uptake in background white matter tissue is low.

It's high affinity for amyloid, improved contrast and enhanced uptake in target regions of the brain compared to background lead to better signal-to-noise ratios and clear images. Greater sensitivity and better contrast may facilitate detection of lower levels of amyloid, earlier identification of disease and detection of smaller changes in amyloid levels to monitor disease progression over time.

Recently, Dr. Tulip presented data on AZD4694 at the ADNI Scientific Board Meeting and at the German Nuclear Medicine Convention.

These presentations highlighted the strong performance characteristics of AZD4694 noted earlier, that appeared to make it an excellent candidate, not only as a standalone diagnostic agent, but also as a biomarker to facilitate enhanced therapeutic drug development. These presentations followed presentations by clinicians at the Banner Alzheimer's Institute in Phoenix of an AstraZeneca-sponsored study on AZD4694 at the Human Amyloid Imaging Meeting in Miami, demonstrating that AZD4694 offers encouraging promise in the assessment of amyloid deposition.

We continue to be encouraged by our progress with AZD4694, and are currently focused on supporting ongoing Phase II studies, additional Phase II studies to be commenced later this year, and of course, the Phase III clinical trials, which we expect to start in early 2013.

Moving onto brief updates on CFT and RIGS. On the basis of the option agreement we announced in the first quarter for CFT, we have continued to make progress on our diligence efforts for this radiopharmaceutical.

The primary focus of our activities has been on developing a full understanding of the registration requirements for the agent with various regulatory authorities, and we continue to gain important feedback, although our work is not yet complete. CFT is an Iodine-123 radiolabeled imaging agent being developed as an aid in the diagnosis of Parkinson's disease and movement disorders.

It is a small molecule radiopharmaceutical that binds to the dopamine transporter on the surface of dopaminergic neurons in the brain, the loss of which is a hallmark of Parkinson's disease.

CFT is used with SPECT imaging to identify the status of these brain regions in patients suspected of having Parkinson's disease, who exhibit lower levels of CFT binding and weaker SPECT imaging signals. CFT has undergone study in more than 600 patients to date, and is currently under a Phase III Special Protocol Assessment with the U.S.

FDA. It is a high affinity agent that can generate clean images quickly, beginning within approximately 20 minutes after injection, as opposed to waiting periods of 4 to 6 hours, and up to 24 hours, as required with other agents.

CFT is also a fully synthetic molecule unlike agents which are derived from coca leaves, are related to cocaine derivatives and are therefore subject to listing a scheduled to controlled substances by the U.S. Drug Enforcement Agency.

CFT can also be sterilized, whereas other agents are provided aseptically. So CFT could have important practical convenience and handling advantages.

In addition to potentially being useful as an aid in the diagnosis of Parkinson's disease and movement disorders, CFT may also be useful in the diagnosis of Dementia with Lewy Bodies, or DLB, one of the most common forms of dementia after Alzheimer's disease. Alongside AZD4694, in the diagnosis of Alzheimer's disease, CFT offers a complimentary, late-stage, precision diagnostic radiopharmaceutical aimed at not only another leading neurodegenerative disorder, Parkinson's disease, but also this common form of dementia, DLB.

We look forward to concluding the activities for which the option agreement was executed and to potentially completing the license itself in the next few months.

Regarding RIGScan, we continue to focus on manufacturing activities using a clone for a humanized form of the anti-TAG-72 antibody based upon the positive guidance we received from both the EMA and FDA last year. Changing to a humanized form from a mouse-based antibody enables the use of a more clinically acceptable drug, which is better positioned for regulatory approval, partnering and commercialization.

These CMC and nonclinical steps are integral to an effective drug development program. While time consuming, they are necessary prerequisites for ensuring the availability of an ongoing supply of drug and in gaining regulatory authorization to recommence clinical development with a technology that has been out of clinical development for over a decade.

We do not expect to partner RIGS until we can gain clarity on the full scope of development required for registration and assess the potential value of reaching more advanced development stages.

I will now turn the call over to Tom to discuss business and commercial development progress.

Thanks, Mark, and good morning to all. Today, I'd like to provide you with a snapshot of our business and commercial development activities, and share our progress towards a successful Lymphoseek launch in the fall.

We continue to advance our preparations for Lymphoseek commercialization here in the U.S. in close collaboration with our partners at Cardinal Health, making important investments to prepare for the launch and positioning the product for a strong, long-term commercial performance.

We continue to gain market insight as to how Lymphoseek's advantages will bring value to both nuclear medicine and cervical clinicians, and most importantly, their patients. These new insights are allowing us to optimally position the product relative to competition and to understand pricing.

Pricing has not yet been set, primarily because the ultimate label for the product is yet to be confirmed. Our communications platforms are also being refined, and training for internal and external audiences are planned.

We are very confident in the successful launch of the product when it's approved for sale by the FDA. We also continue to make progress establishing partners for the drug around the world.

As we've mentioned before, in Europe, on February 1, we announced that we've been advised by EMA's CHMP committee that it has adopted the advice of its scientific working party group, that determined Lymphoseek was eligible for MAA application based on the clinical data accumulated to date in our Phase III pivotal studies and the supporting clinical literature, which includes a comparison with the available colloidal materials in Europe.

Accordingly, under this guidance, we've initiated a regulatory activity to submit this MAA for Lymphoseek by the end of this year, 2012. This revised timeline, which is likely the result from earlier than previously planned submission and potential registration, has accelerated our discussions with potential European partners.

We developed a short list and are working through the pros and cons of the respective sales and marketing partners. We expect to make our decisions in the coming months, which will enable us to work closely with the selected partner or partners to prepare the European market for a Lymphoseek launch in 2013.

I should add that our primary objective in coming to these decisions will be to maximize our long-term economics. Thus, we may consider trading off an upfront payment in exchange for immediate investment in market development by the partner, coupled with better sustainable return to Navidea.

Also, we continue to explore what role, if any, we should play directly in Europe to optimize our future prospects.

Additionally, we continue to advance our dialogues with potential partners in Asia and the Americas as well, and expect these to mature throughout the remainder of this year.

Now I'd like to turn my attention to AZD4694. From a partnering front, we are experiencing very solid expressions of interest in commercial -- potential commercial partners for 4694 in 2 areas.

Certainly, potential sales and distribution partners around the world have expressed the strong interest in working with us, having recognized the potential advantages that the product may bring. Additionally, Mark alluded to the fact that the biopharmaceutical sector is beginning to appreciate the potential advantages that this high-sensitivity F 18 biomarker could convey in the development of pharma's disease-modifying therapies.

The superior sensitivity and very low nonspecific background activity of the tracer strongly suggest that it will be useful as an adjunct in Alzheimer's disease therapy development.

As a note, there are currently more than 40 therapeutic agents for Alzheimer's disease in Phases II and III. By identifying patients with lower level of amyloid, it may be possible to enroll these patients, enrich the study populations and -- when the plaque burn is lowest.

Additionally, it may be possible to follow these patients because of the high sensitivity of AZD4694 to detect smaller changes in plaque burn over time, thereby enabling better assessment of disease progression. Clearly, retaining access to AZD4694 and having it developed as a validated biomarker was a strong motivation for AstraZeneca, who partnered with us, and they continue to express that interest.

A broad interest in these applications was certainly evident at the recent ADNI Public Private Partnership Meeting that I was fortunate enough to attend, and elsewhere from other biopharmaceutical companies, as well as the scientific community. We believe that there will be growing interest in the application of AZD4694 as a precision diagnostic -- a precision biomarker for the assessment of Parkinson's disease, and look forward to working with all of these interested parties to advance the science.

We also believe we'll have a place in a number of longitudinal disease progression studies which are being established around the world. Finally, we continue to identify interest in potential end license and/or acquisition opportunities to meet our criteria for precision radiopharmaceutical development.

A candidate must have reached at least the proof of concept stage, have shown results demonstrating solid safety and efficacy, and addressed the clear medical need, thereby promising significant market potential. We will report progress in these areas as these opportunities mature.

At this time, I'd like to turn the mic back over to Brent.

Thank you, Tom. Good morning, again, everyone.

Before I discuss our quarterly and year-to-date results, I just want to remind everyone that the results related to our GDS business, which was sold in the third quarter of 2011, and previously reported in the various line items of our financial statements such as revenues, research and development and so forth, have been reclassified to discontinued operations for all the periods presented. After considering this reclassification, Navidea's revenues for the first quarters of 2012 and 2011, therefore, relate to grant revenue received in support of the company's development activity.

Grant revenues for the first quarter of 2012 were $12,000 compared to $336,000 for the same period in 2011. Costs related to these grants that are received in support of development activities are accordingly recorded in research and development expenses.

Navidea's research and development expenses for the first quarter of 2012 increased 62% to $3.9 million from $2.4 million for the same period in 2011. The increase in R&D expenses from the first quarter of 2012 was attributable to a number of primary factors including increased Lymphoseek development cost of approximately $306,000 related primarily to cost support the NDA activity, more than offsetting decreases in clinical trial costs.

Second, during the first quarter of 2012, the company paid a $500,000 license option fee related to the CFT agent, a neuro imaging agent to aid in the diagnosis of Parkinson's disease and other movement orders. And third, the company included approximately -- incurred approximately $700,000 in increased R&D related to a combination of factors related to our pipeline product development activities and candidate evaluations, as well as some increased headcount to support these overall development efforts.

Selling and general and administrative expenses increased $327,000 to $2.6 million for the first quarter of 2012 from $2.9 million for the same period in 2011. The primary reason for the net decrease was that -- due to $1.7 million in nonrecurring charges related to the separation of the company's former CEO, that was recorded in the first quarter of 2011, which was partially offset by an increase in approximately $1.1 million in marketing and business development costs related to the preparation for the commercial launch of Lymphoseek and efforts to build the company's product pipeline.

This was coupled also with approximately $300,000 in general increases and other general and administrative headcount professional services costs that were incurred in the first quarter of 2012.

Other expenses for the first quarter of 2012 were $473,000 composed primarily of $294,000 in interest expense related to the loan that we entered into in December of 2011, and $184,000 from the changing value of derivative liabilities on the company's balance sheet. This compares to other expenses of $953,000 for the same period in 2011, which consisted almost entirely of the impact in the change in value of the company's derivative liabilities.

The net loss attributable to common stockholders for the first quarter of 2012 was $7 million or $0.07 per share compared to a net loss attributable to common shareholders of $4.4 million or $0.05 per share in the first quarter of 2011. Upper management continues to believe that investors' ability to analyze our business trends and understand our financial performance is better served from reviewing certain above the line operational measures, such as income and loss from operations, which we believe is more representative of the cash flow related to our business.

The loss from operations for the first quarter of 2012 then was $6.5 million compared to $5 million for the same period in 2011. We ended the first quarter with $21.9 million in cash.

Management remains confident, despite the extension of the PDUFA date and given the size of our cash balance, that our balance sheet remains strong. We believe our resources allow us to continue to adequately support our active development programs and reach positive cash flow revenue -- cash flow and revenue from Lymphoseek, our first radiopharmaceutical product.

Now, let me turn the call back over to Mark for concluding remarks.

Great, Brent. Thank you very much.

I think we'll take questions at this point.

My first question is regarding Lymphoseek. I'm wondering if [indiscernible] push.

You said that it wasn't related to [indiscernible] colloid. However, would you anticipate that the agency may request the additional, or some of the additional information yet?

And do you anticipate that the agency could conduct their own comparisons with sulfur colloid?

At this point, no, we do not anticipate that the agency will request information comparing Lymphoseek to sulfur colloid. We have submitted, as we've said before, the NDA and the basis of the comparison of Lymphoseek to vital blue dye in prospectively well-controlled studies that met all of their primary and secondary endpoints, all of which are very supportive of the NDA during its review process.

We also know that in the extension of the label for sulfur colloid into breast cancer lymphatic mapping, that they relied on a meta-analysis of sulfur colloid to vital blue dye as well, again, implying that it is an acceptable comparative for purposes of registration. So we do not expect the agency to come back and ask for additional information related to sulfur colloid.

We do not have any indication that they themselves are doing any sort of comparison to sulfur colloid, although we could not rule out that possibility, of course.

My questions there are on somewhat similar line. If you -- the timeline that you laid out for the presentation of topline data from the head neck study now potentially fall before the completion of the FDA review for Lymphoseek.

Do you anticipate the FDA may seek to see some of the head neck data and include that in a primary analysis? And if not, how do we think about timeline for label -- potential label expansion around Lymphoseek based on the head neck data?

That's a great question. Certainly, what we're able to forecast now is the possibility of reaching an interim analysis point by the middle of this year.

That doesn't mean that the trial will close, it doesn't mean that we will meet the endpoints supportive of closing the trial in the basis of interim data only, but we do believe that we can drive to an interim analysis, which will allow us to make decisions about the prospects for success of that trial and have a look at the data. It will take multiple months to complete that process by simply arriving at the point for the interim analysis.

Then the data have to be audited, assessed, reports have to be drafted and so forth, before we can even disclose top line data let alone [indiscernible] phase beyond the September 10 PDUFA date. And so we don't envision that coming into play from the FDA to complete the NDA review.

Has the FDA come back -- as you submit your CMC supplemental data, late March, have they come back and ask for anything else or is that the last request you got from FDA?

That's the last request we've gotten from the FDA. They've not come back on any other topic so far.

Okay. And a quick follow-up on that.

The Alzheimer's program is based on PET imaging, while the Parkinson's program's on SPECT imaging. Do we -- I mean, is that part of your equation on how to market this thing?

Because your facilities are generally either/or, they don't have both sets of cameras. So is that equation sitting between Alzheimer's and Parkinson's on different equipment?

Yes, they will use different equipment. So the Alzheimer's agent will use PET cameras to perform the imaging procedure, the Parkinson's agent searcher, we complete the license, we will use SPECT cameras to complete the imaging procedure.

It actually provides diversity in our pipeline. It provides the opportunity now when we look at different disease states within neurology to provide the basis of a neurology franchise, but also diversification of the equipment, processes, distributors and so forth, that are used in the delivery of these agents and the performance of the clinical procedure.

I'm going to ask one macro question and then I'll just follow up with a quick micro question. On the macro side, obviously, you're now making that very, very important transition from a research shop, development shop into an actual "revenue shop."

And you're going to be introducing your product, Lymphoseek, which is going to be introduced where physicians understand it for 1 or 2 general, current indications, specifically breast cancer. But Cardinal and you both understand that it's not going to be just limited to that at the extreme, given the how the product works and its benefits.

Can you give us a little bit of color on how you and Cardinal -- and obviously, you can't speak for Cardinal, but how you view that singular advantage going forward? So the introduction is not just going to be the be-all and end-all, that's just going to be the very start of what you've got.

And then one micro follow-up.

Sure. I would say that, that's generally correct.

Although when we launched this product, we -- and with the data we have already developed to date, we are looking at 2 cancers, both breast cancer and melanoma, and now we are developing data in a third cancer, in head and neck. And certainly, ultimately, the label that we're able to achieve initially will drive where the agent might be used initially, how it might be reimbursed initially, but we do envision strong growth potential for the agent into other kinds of cancers, not only head and neck cancer, but other kinds of cancers where lymphatic mapping might be useful, that have been awaiting an ideal agent with the performing characteristic -- performance characteristics like Lymphoseek, where it clears the injection site rapidly, it localizes to the key predictive lymph nodes, and it sticks and binds there because of its receptor-based properties and doesn't move to downstream lymph nodes, which are less informative.

We envision the body of evidence supporting the use of Lymphoseek in those kinds of cancers to develop over time, but to be one of the drivers for reaching the ultimate market potential for Lymphoseek in effect, tapping into the untapped cancers where lymphatic mapping might be useful, but hasn't been performed yet to date.

Okay. And the follow-up I've got has to do with, you've gone out there and you've successfully negotiated licensing arrangements with the big boys.

And we've obviously been seeing the big boys looking at what products are online. By definition, because you've been able to negotiate these types of contracts, which are, frankly, not very usual, unparalleled in some cases, what do you -- how much inflow are you seeing of potential new partners and potential new products?

Give us just a general. And I won't hold you to that because it's just a macro question right now.

Sure, sure. I -- that's a very good question, it's very good.

The question is consistent with the direction that we are moving this business. And we've seen very strong validation of our business model as a developer of mid- to late-stage assets in the precision diagnostics space with a specific focus on radiopharmaceuticals across a series of therapeutic areas that we view as fertile ground for continuing to build an extended asset base, if you will.

And so we are seeing not only large companies come to us, but smaller companies as well. Our expertise and focus are continuously being recognized by a range of parties who are interested in working with us.

Tom touched on that a little bit with 4694, where we're seeing interest not only from the commercial and distribution side in 4694 around the world, but also in its use as a biomarker for therapeutic drug development. And I think it's a strong endorsement of the company's position, its people and its business model, to be approached by pharma to assist them with developing very, very important drugs in the Alzheimer's space relying on an agent like AZD4694, but also the talent and the focus that Navidea has today.

We believe that is an extendable and a flexible business model that we can bring forward to other asset classes as well.

Just very quickly, is it -- is the potential pushout of the PDUFA, does that increase at all the likelihood that a panel be held? Or has there been any discussion regarding a potential panel regarding Lymphoseek review?

No, we don't view it as increasing the likelihood that there will be a panel. We have not been told there will be panel to date, although, of course, we can't rule that out.

Panels can be called at any time, including after a drug has been approved. But typically, panels are brought in to review safety and efficacy issues related to an NDA or BLA review.

In this case, the question that came our way that was the basis for the PDUFA date extension were related to CMC and manufacturing-related questions, which are not typically the domain of advisory committee meetings. And so we don't view this as at all increasing the prospects for an ad comm.

Okay. And just as a quick follow-up, the head and neck data that we hope to be taking a look at, let's say, several months after mid-year.

Can you maybe give us some color as to what should we be expecting? I mean, is it going to be a hard go or no go decision?

Will it be something that more takes into account, let's say, half the patients that should be enrolled? Or is it a quarter of the patients that should be enrolled?

How should we be prepared to look at these results that come out?

Sure. That's another good question.

The interim analysis will be approached like any other interim analysis, where it's a prespecified point to take a look at the data to assess whether, on the basis of prespecified outcomes, you have achieved a level of significance that would allow you to stop the trial. And so there are 3 things that can come.

Number one is you reach a point where the data are encouraging, but you have not quite reached the level of significance and you need to then move forward with continuing to enroll patients so that you ultimately do reach the level of significance. And the bar is quite high for an interim analysis win because it would obviously, a priority [ph], mean a lower number of patients.

The second is that you have compelling data and you do reach that high bar, and you're able to successfully conclude the study. At which point then, the study is wound down and the date are available for filing.

And the third is that you reach a point where you've looked at the data, that don't look encouraging, and you might choose to close the trial because you would view it as unlikely, that enrolling future more patients would lead to a different outcome when everything is said and done. On the basis of the data that Dr.

Lai presented, which are anecdotal stories from his experience at his center, the prospects for the interim analysis producing good data, I think, are encouraging. Although we can't conclude that because, of course, we haven't done the interim analysis yet.

So we'll continue with the process by, hopefully, sometime around the middle of the year, reaching a point when we can conduct the interim analysis, complete that procedure, as I said, doing a fully audited evaluation of the data, and then come to the determination as to whether or not we close the trial or keep enrolling patients.

I wanted to follow up on the European side of the Lymphoseek regulatory strategy. Mark, I'm wondering if you could contrast what the European folks have asked for in terms of their colloidal comparison, and help us understand why they may have a different kind of view to making that comparison than perhaps the U.S.

agency had. And if it's possible that because you had that agreement with the agency, that, that's really what defines the process here in the States?

The feedback that we got from the EMA through what is traditionally a very rigorous process involving their scientific advice working party and then their CHMP group, which helps to provide guidance to companies, was that on the basis of the Phase III studies already completed, as well as all the other studies which led to the enhanced safety database and enhanced understanding in patient experience in our own studies, coupled with the review of literature-based supportive data, including data that relates to sulfur colloid, which we touched on in the call today, the full data for which will be presented at ASCO in June, was sufficient for them to say that there is enough of a body of evidence to move forward with the Marketing Authorization Application. The Marketing Authorization Application is very much like an NDA.

It's a comprehensive document, requires slightly different parameters and it's slightly differently formatted and so forth. So there's a lot of work that goes into doing it correctly.

But we believe by certainly, year end, we can potentially submit the MAA, possibly sooner. The only difference really in how that pans out for us then is that in Europe, there is a different set of colloidal materials that are used, in fact, 2 that are used primarily throughout Western Europe, and we have developed literature-based analyses on both the meta-analysis and pooled data analysis for those agents and the experience in Europe, much as we've done for the sulfur colloid comparison here in the U.S.

Okay. And then if we could move quickly to 4694.

We recently attended AAN and there was a lot of data on the first-generation AD imaging agents. And then there was a recent approval on launch of Amyvid.

I guess I'm kind of wondering if you could provide a little bit more information on the basis of your confidence in the market need and then the competitive advantage that 4694 could have. And perhaps some of the clinical community feedback you've gotten recently.

Sure. Tom has attended these meetings, so I'll let Tom answer that question.

Sure. I think that our confidence springs from the initial preclinical, and now, advancing clinical work, which clearly demonstrates that 4694 is really quite sensitive, apparently more sensitive than the first-generation F18 tracers.

In fact, I think the better comparison now is against C-11 PiB, which is the archetypal amyloid tracer to which everyone draws comparison, which most of the longitudinal studies are based. And it would appear that 4694 has many of the positive attributes of C-11 PiB, higher sensitivity, very low white matter uptake, as compared with the first-generation F-18 tracers, while 4694 still retains the isotopic advantages, if you will, of a Fluorine-18 agent.

The fact that one can make and distribute a PiB can be used in a clinical setting with fairly broad reach. So both that strong preclinical work and the advancing clinical information that's evolving continues to support our sense that this is a significantly superior agent in the applications we're looking for.

And happily, we're getting ping [ph] quite frequently from the clinical -- from the scientific community, in strong expressions of interest to help us determine that, to use it in various applications.

I just have a couple of quick questions. The -- in terms of labeling on Lymphoseek, do you guys expect more limited labeling initially?

Or could there be a possibility of a broader labeling coming out of the FDA review?

Spencer, that's a great question. This is Mark.

The label discussions with the agency to finalize what the label will look like typically are one of the last things that the agency contemplates with the sponsor, so we don't yet have a final answer as to how the label will come out ultimately. And as Tom mentioned, it is important in terms of the product positioning, our understanding of its competitive advantages and its use, and ultimately, the initial entry point for the product.

Although we don't envision it being limiting, one way or the other, and ultimately getting into the cancers and to the broader market that we think Lymphoseek can ultimately serve. It is possible that through the data review and through the dialogue with the agency, that we will come to a point where the focus on breast cancer and melanoma, because of the data submitted in the NDA, will be weighted more heavily, and that the pending data in head and neck that could arise subsequent to the NDA approval might be influential in getting some sort of label extension.

We just don't know the answer to that right now, and it's probably premature in the process to speculate.

Great, that's helpful. And then one quick follow-up.

Do you guys have any sense what the current market penetration of sulfur is against blue dye?

Tom, would you like to try and answer that question?

There are 3 scenarios out there right now, one in which clinicians only use the dye that's in a minority of circumstances, one in which clinicians use the colloidal radiopharmaceutical alone, and that's an even smaller minority. The vast majority of situations involve the application of both sulfur colloid and blue dye, and I think that's well above 65%.

So those are the sort of numbers that we're seeing. We would expect initially to be considered -- to be used with, that maybe in conjunction with the dye, but then hopefully, in the future, based on the information we've already generated in future information, perhaps moving into a singular circumstance as the product's use evolves in the clinical setting.

Just a quick follow-up. Can you just talk about the remaining milestones for the year?

Obviously, we know the PDUFA date, but maybe talk a little bit more about 4694 and the potential initiation of studies, as well as -- I know you talked about CFT and the ongoing due diligence, but do you have any sort of an update as to when you could conclude those due diligence? As well as any other milestones you feel are important.

Sure, Ren. This is Mark.

So certainly, the PDUFA date looms large in the third quarter, in September. We'll continue to support the NDA review.

I think that, obviously, is an important milestone, which would then lead to commercial launch in the United States with Cardinal Health. We -- at the same time, we'll be focusing on filing the MAA in Europe.

That preparation process is well underway. As we've stated before, we believe that we certainly can meet that filing date by the end of this year, although it's possible we can do better than that.

We will continue to strive to do better than that. With respect to AZD4694, there are ongoing Phase II studies.

We will continue to present data from those ongoing Phase II studies as they become available. We do expect to initiate at least one, if not more, Phase II studies that would be Navidea-sponsored and not AstraZenica-sponsored or sponsored by the investigator.

We also envision making good progress with both the EMA and the FDA for the Phase III clinical study for AZD4694. We are also going to be potentially arriving at the interim analysis point for the head and neck study, potentially with the ability to disclose data.

There could be additional center-experience-based presentations that would allow us to describe how the agent is being used, et cetera, outside of MD Anderson Cancer Center. The CFT imaging agent option agreement runs through June.

It's potentially extendable through July. As I mentioned, we're making good progress with the understanding of the regulatory requirements for registration with various regulatory authorities.

We believe that, should things continue to look encouraging on that front and we do gain clarity on the registration requirements, that we can complete that agreement and then begin the process for ramping up clinical trials for that agent in Phase III, as well as additional CMC-related matters that would be required to begin clinical studies. As Tom mentioned, we are seeing a lot of interest in 4694 from pharma organizations who are interested in using it as a biomarker to assess disease progression and the effectiveness of their Alzheimer's disease therapeutics.

In modifying disease progression, we may be able to identify a partner or a collaborator in pharma to be able to work alongside them, one or more partners in pharma to be able to work alongside them. On their drug development activities, we are seeing quite a bit of traction for Lymphoseek on the commercial front outside the U.S., not only in Europe, but in other countries around the world.

And as Tom mentioned, we look forward to the remainder of this year bearing out continuing growing interest for Lymphoseek in distribution and commercialization.

The first part of the question is relative to the balance sheet, more specifically, the cash position. At present, the burn rate's a little over $2.1 million a month.

Going out to the rest of the year, do we anticipate that burn rate to increase, decrease or stay the same? And secondly is, I should say, up and upon until the revenues anticipated, revenues of Lymphoseek, does management foresee the need to augment the cash position?

Rick, Brent Larson here. First of all, let me just reiterate what I think was said in the release and what we'll certainly continue to say in our public filings, that we think we had a very strong balance sheet.

From a second -- excuse me, from looking at the first quarter specifically and looking at the burn there, there's close to $1 million in items in there that are essentially nonrecurring-type items in the form of the option to license the CFT asset, and there's some preparation costs related to the advisory committee meeting, which again, as Mark said, we don't view as likely at this point in time. As far as that goes, I think the questions that we certainly have to this point of, again, not related to safety or efficacy, and we're going to continue to focus our efforts on supporting the NDA from the CMC standpoint.

The other thing, I guess, I'd point out is that our cost structure, while it's -- compared to last year, a big part of that increase is obviously in the area of marketing and business development to support the launch activities. These costs can continue to be controlled and are really not increasing despite the extension of the PDUFA date.

So we continue to manage those costs. And we believe our overall -- our virtual model continues to provide us a great deal of flexibility as having incurred expenses.

We've also got a number of different cash flow inflows from potential sources, such as grants and R&D collaborations and other things that go into the overall calculus, I guess, of how we look at our burn rate. So I guess one of the things that I think you, Rick, from having probably seen us before, we have a pretty good ability to manage the burn rate and effectively do that.

As far as financing or augmenting the balance sheet, at this point in time, the statement that we've made is that we don't believe it's necessary for us to do that based on the PDUFA extension. But certainly, we recognize that as prudence stewards of the balance sheet, we'll look at things as we go forward.

We have a shelf registration in place, it's been there for almost a year now. But I guess the point that I would draw your attention to there is that we haven't drawn on that to this point in time.

We have a financing vehicle in place if necessary. We don't view it as necessary at this point in time, but certainly recognize that as we gain opportunities, either as through Tom's additional business development or other efforts, that we may want to evaluate what our -- those options are in a very prudent basis and continue that.

So I guess -- I don't know if that is a roundabout way of answering your question to say we think we're still in a fine position, but we recognize that there are future opportunities or challenges out there that we will consider at the time when they come up.

Maybe a related question. When can we expect to hear anything about the device sales from which, I believe it's a maximum of $20 million of royalties, commissions, I'm not sure how it's defined, but when -- a form of device sales, when do you think we might get some insight to how that's going, and when and if we'll receive any funds from that?

This is Brent again. I'll go ahead and answer that question.

You're right about the rough thresholds here. Our first payment, if any, would be due in the first quarter of 2013.

That would be based on overall sales levels for 2012. And certainly, if you recall back to the days of when we had the device business in-house and we recalled the guidance that we did, or more appropriately, didn't give early in the year regarding what the revenue would be for that for any given year, I think it's going to be well into the year before we have a confidence level to talk about that, given some of the seasonality and the fluctuations.

So I'm hopeful that we'll be able to get a good look at it and have a good feel by sometime in the late third quarter as far as what we might able to expect there, because it will be well into the year and have a good idea as far as how solid the year is turning out. But frankly, at this point in time, that is, from our budgetary standpoint, an upside type of a factor when we look at our cash flow forecasting.

Great, thank you very much. Thank you for your time on today's call and for your interest in Navidea.

We look forward to continuing to keep you updated on our progress, the next step with Lymphoseek as it moves through the review and approval process toward commercial launch, and to other advances in other areas of the business. Thank you.