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Edited Transcript of CARA earnings conference call or presentation 7-May-19 8:30pm GMT

Q1 2019 Cara Therapeutics Inc Earnings Call

Shelton May 23, 2019 (Thomson StreetEvents) -- Edited Transcript of Cara Therapeutics Inc earnings conference call or presentation Tuesday, May 7, 2019 at 8:30:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Derek T. Chalmers

Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director

* Mani Mohindru

Cara Therapeutics, Inc. - CFO & Chief Strategy Officer

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Conference Call Participants

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* Alan Carr

Needham & Company, LLC, Research Division - Senior Analyst

* Annabel Eva Samimy

Stifel, Nicolaus & Company, Incorporated, Research Division - MD

* Christopher Lawrence Howerton

Jefferies LLC, Research Division - Equity Analyst

* David A. Amsellem

Piper Jaffray Companies, Research Division - MD and Senior Research Analyst

* Esther Lannie Hong

Janney Montgomery Scott LLC, Research Division - Director of Biotechnology

* François Daniel Brisebois

Laidlaw & Company (UK) Ltd., Research Division - Healthcare Equity Analyst

* Michael Schaffzin

Stern Investor Relations, Inc. - Director

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Presentation

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Operator [1]

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Good afternoon, and welcome to the Cara Therapeutics First Quarter 2019 Financial Results Conference Call. (Operator Instructions) Please be advised that this call is being recorded at Cara's request. I would like to turn the call over to Cara team. Please proceed.

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Michael Schaffzin, Stern Investor Relations, Inc. - Director [2]

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Good afternoon. This is Michael Schaffzin with Stern Investor Relations, and welcome to Cara Therapeutics First Quarter 2019 Financial Results and Update Conference Call. The news release became available just after 4 p.m. today and can be found on our website at www.caratherapeutics.com. You may also listen to a live webcast and replay of today's call on the Investors section of the website.

Before we begin, let me remind you that statements made on today's call regarding matters that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Examples of these forward-looking statements include statements concerning the expected timing of the completion and announcement of the results of our ongoing clinical trials, the expected timing and design of our planned clinical trials, future regulatory and development milestones for our product candidates, the potential for CR845 to be a therapeutic option in multiple pruritus indications, the size of the markets that are potentially addressable by our product candidates and our expected cash reach.

Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Risks are described more fully in Cara Therapeutics' filings with the Securities and Exchange Commission, including the Risk Factors section of the company's annual report on Form 10-K for the year ended December 31, 2018, and its other documents subsequently filed with or furnished to the Securities and Exchange Commission.

Participating on this call are Dr. Derek Chalmers, Cara President and CEO; and Dr. Mani Mohindru, Chief Financial Officer and Chief Strategy Officer. I'll now turn the call over to Dr. Chalmers.

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [3]

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Thank you, Michael, and good afternoon everybody and thanks for joining us on the call today. So we've continued to make important progress during the first quarter of this year, advancing our lead drug candidate KORSUVA across a range of clinical populations where pruritus remains a significant unmet clinical need, and we expect multiple late-stage clinical readouts from of our pipeline throughout the remainder of this year.

As many of you know, KORSUVA is our novel, first-in-class selective peripherally acting kappa opioid receptor agonist designed to function without traditional opioid side effects due to its highly specific pharmacological action on kappa receptors and its chemical structure. Our lead development program is KORSUVA Injection for chronic kidney disease-associated pruritus, or CKD-aP, in hemodialysis patients where we currently have 2 ongoing pivotal Phase III trials designated KALM-1 and KALM-2.

Earlier this year, we announced we had completed enrollment of the KALM-1 trial. We're happy to note that as of today, all patients in KALM-1 have now completed their treatment period and last visits, and we're on track to report top line data a little later this quarter. Additionally, based on current enrollment progress, we also expect to report top line data from KALM-2 in the second half of 2019.

We're also making good progress in advancing the development of Oral KORSUVA across a number of patient populations where pruritus continues to be a significant unmet need. Firstly, our ongoing Phase II trial in pre-dialysis stage III-V CKD patients with moderate to severe pruritus is enrolling well, and top line data is expected here in the second half of 2019. Additionally, we plan to initiate 2 other Phase II trials in non-CKD patient groups: the first in chronic liver disease-associated pruritus a little later this quarter and the second in atopic dermatitis around midyear.

So overall, we remain well positioned to execute on our lead pivotal Phase III program for CKD-aP in hemodialysis patients as well as progress our Oral KORSUVA programs across multiple patient populations through 2019. Before we provide overview on each of our ongoing programs, I want to briefly remind you of KORSUVA's mechanism of action and why we believe it has the potential to be a first-line therapy for pruritus across patient populations.

KORSUVA's therapeutic action is mediated by kappa receptors on peripheral sensory afferents as well as on certain immune cells. The action of KORSUVA on dermal and epidermal immune cells blocks the release of a range of nerve-sensitizing molecules or pruritogens, diminishing the stimulation of dermal sensory fibers. We believe that this dual neuronal and anti-inflammatory effect affords KORSUVA an effective antipruritic action regardless of the initiating pathophysiology, whether that's chronic kidney disease, chronic liver disease, a dermatological condition or some other clinical situation.

So moving on to our clinical programs. Let's start with KORSUVA Injection for hemodialysis patients with CKD-aP. This is a patient population where moderate to severe pruritus occurs in approximately 40% of patients. It significantly diminishes quality of life and is associated with increased morbidity and indeed mortality. The FDA has granted KORSUVA Injection Breakthrough Therapy designation for this indication, reflecting the significant unmet need with no therapeutics approved in the U.S. or indeed Europe at this point.

The pivotal program for KORSUVA Injection in this patient population currently includes 4 ongoing Phase III studies: KALM-1, a U.S. efficacy trial; KALM-2, a global efficacy trial; and 2 open-label safety studies, 1 U.S. and 1 global, and I'll cover each of these shortly. Both KALM-1 and KALM-2 are designated -- are designed to investigate the efficacy of KORSUVA Injection at a dose of 0.5 micrograms per kilo versus placebo. The drug is administered 3 times per week after scheduled dialysis sessions over a 12-week treatment period with a 52-week open-label extension phase for safety. The primary efficacy end point is the proportion of patients achieving at least a 3-point improvement from baseline at week 12 with respect to the weekly mean of the daily worst itching intensity score measured on a standard Numeric Rating Scale.

Secondary end points in the trials measure aspects of itch-related quality of life using validated self-assessment scales, namely, the Skindex-10 and the 5-D itch, both of which we had also previously employed in our completed Phase IIb trial. Additional secondary end points include the proportion of patients achieving a greater than or equal to 4-point improvement from baseline in weekly mean of the daily 24 (sic) [24-hour] worst itch NRS score at week 12.

The third ongoing Phase III trial in our pivotal program is an open-label, 52-week extension safety study which we initiated in 2017. We recently expanded this trial to enroll up to 300 patients from 240 patients with currently about 150 patients through 6 months of treatment and approximately 40% of these patients completed 1 year of exposure. To date, the safety and tolerability has been consistent with the data reported in Phase II trials of KORSUVA Injection in hemodialysis patients. And based on completed Independent Data Safety Monitoring Board evaluations, the last of which was in Q1 of this year, no new safety signals have been observed to date.

In addition, with the aim of accelerating safety exposures to KORSUVA Injection, we've recently initiated a second open-label safety study utilizing both U.S. and European clinical sites. And to clarify, this is not a trial required for any specific request from any regulatory agencies but rather part of our regulatory strategy to utilize novel clinical sites and accelerate required safety exposures per ICH guidelines in an effort to further expedite our path to NDA filing. This trial is expected to enroll up to 400 patients with a maximum treatment period of 12 weeks.

So with top line data from both KALM-1 and KALM-2 expected this year and rapidly accumulating long term and total patient safety exposures from the ongoing open-label trials, we do remain on track toward our goal of developing KORSUVA Injection as a first-in-class therapeutic for hemodialysis patients suffering from pruritus as quickly as we possibly can.

We also remain focused on advancing Oral KORSUVA for pre-dialysis patients with moderate to severe CKD-aP. Based on generic pruritus-related script numbers, it is estimated there are at least 2.5 million stage III-V CKD patients suffering from pruritus in the U.S. with current standard of care being predominantly generic corticosteroids and antihistamines.

So we're currently evaluating Oral KORSUVA in an ongoing U.S. Phase II trial for pre-dialysis CKD-aP patients. This trial is a multicenter, randomized, double-blind, placebo-controlled, 12-week trial designed to evaluate the safety and efficacy of 3 doses of Oral KORSUVA, 0.25 milligrams, 0.5 milligrams and 1-milligram tablet strength administered once daily. In this Oral KORSUVA Phase II trial, we're enrolling 240 patients with 60 per arm. There's an unblinded interim power assessment at 50% enrollment for those subjects who have completed 12 weeks of treatment that allows for expansion of the study up to 480 patients. This trial is currently on track for patient enrollment, and we expect to complete the interim assessment in the next few months and ultimately providing top line data in the second half of this year.

Lastly, as we move forward with additional pruritic patient populations that may benefit from Oral KORSUVA, we plan to initiate 2 additional Phase II trials in the near term: the first in chronic liver disease-associated pruritus in Q2 and the second in pruritus associated with atopic dermatitis around midyear. And we will provide more detail around trial design and patient selection for both of these trials upon initiation.

So overall, we're very pleased with our team's execution and all of the progress across our clinical programs so far this year, and we look forward to providing further updates as we advance KORSUVA through several significant clinical milestones in the coming months. And with that, I'll now turn the call over to Mani to discuss our Q1 financial results. Mani?

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Mani Mohindru, Cara Therapeutics, Inc. - CFO & Chief Strategy Officer [4]

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Thank you, Derek. As a reminder, the full financial results of our first quarter of 2019 can be found in the press release that was issued earlier today after market closed.

For the first quarter of 2019, we reported a net loss of $22 million or $0.56 per basic and diluted share compared to a net loss of $16.8 million or $0.51 per basic and diluted share for the same quarter of 2018. For the first quarter of 2018 (sic) [2019], we recognized revenue of $4.4 million comprised of $4.2 million related to the Vifor Fresenius collaboration agreement and $140,000 related to the sale of clinical compound to our partner Maruishi in Japan. We did not recognize any revenues during the first quarter of 2018.

For the first quarter of 2018 (sic) 2019 of this year, we reported R&D expense of $23.6 million as compared to $13.4 million for the same period of 2018 primarily due to an increase in clinical trial costs as well as increases in stock comp expense and payroll-related costs. G&A expenses were $3.9 million during the first quarter of 2019 compared to $3.7 million in the same period of 2018. The slight increase in 2019 period was due to increased legal and consulting costs.

Other income was $1.1 million for the first quarter of 2019 versus $311,000 for the same period in 2018. The increase in 2019 was due to higher interest income resulting from a higher balance of company's investment portfolio in the 2019 period. As of March 31, 2019, our cash and marketable securities totaled $156.1 million compared to $182.8 million at the end of 2018. The decrease in the balance cash and cash equivalents and marketable securities -- the decrease in the cash, cash equivalents and marketable securities was primarily result -- related to cash used in operations of $27.5 million slightly offset by proceeds of $0.2 million from the exercise of stock options.

Turning to our financial guidance. Based on the projected costs of our clinical development plans and timing expectations, we believe that our current cash, cash equivalents and marketable securities as of March 31, 2019, will be sufficient to fund our operations into the fourth quarter of 2020 without taking into account any potential milestones payments under our existing collaborations. This is a revision from our prior guidance of cash runway into 2021 and is primarily due to accelerated and higher clinical trial expense projections related to our Phase III program of KORSUVA Injection for CKD-associated pruritus in hemodialysis patients.

And now we'll turn back the call to the operator for the Q&A session.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from the line of Chris Howerton with Jefferies.

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Christopher Lawrence Howerton, Jefferies LLC, Research Division - Equity Analyst [2]

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Great. Pretty straightforward, I think just a couple questions for me. The first one in terms of the expectations or requirements for the long-term safety exposure. What kind of numbers are we looking for there?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [3]

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Yes, Chris, thanks for that. So standard ICH guidelines is we're looking for 100 exposures at the 1-year mark and 300 at the 6-month mark.

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Christopher Lawrence Howerton, Jefferies LLC, Research Division - Equity Analyst [4]

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Okay. Okay. So pretty straightforward. And then the other question I had was IV KORSUVA would be subject to TDAPA for reimbursement. And are you aware of any other products that would fall within that category or assessment?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [5]

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Upcoming products we're talking about, Chris, or products already within the TDAPA reimbursement?

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Christopher Lawrence Howerton, Jefferies LLC, Research Division - Equity Analyst [6]

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Yes. Yes. I don't think there's any currently, right? So like what might be -- fall within that category, I guess.

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [7]

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Right. So the only product we know of is IV Parsabiv from Amgen, the calcimimetic product that was approved a couple years ago. So that is paid out with the bundle. Beyond that, we're unaware of other products coming to the market there. In fact, we believe we may well be the next product in line there for TDAPA agreement.

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Christopher Lawrence Howerton, Jefferies LLC, Research Division - Equity Analyst [8]

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Okay. Well, then you get the opportunity to trail-blaze a path for us there.

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [9]

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Exactly, and we're looking forward to that.

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Christopher Lawrence Howerton, Jefferies LLC, Research Division - Equity Analyst [10]

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All right. Well, like I said, it seemed pretty straightforward in there and obviously, look forward to the KALM data coming up soon.

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Operator [11]

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And our next question comes from the line of Jason Gerberry with Bank of America.

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Unidentified Analyst, [12]

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This is [Chi] on for Jason. A couple of questions from me. First one is can you provide any color on where you are with the enrollment rate in KALM-2? And when can we roughly expect an interim data analysis for that study? And my follow-up question was a follow up to the first question. So if the ICH guideline for exposure is 100 exposure at a 1-year mark and 300 at the 6-month mark, it sort of makes sense to me with the 400 patients with the long-term safety study. Just curious how does the second open-label safety study fit in with the 12-week duration. Is it for a specific regional regulatory requirement? Is this something specific for global as opposed to U.S.? If you can provide any color, that would be great.

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [13]

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[Chi], thanks for that. So let's take the second question first since that's a little more involved. So the second open-label safety trial we've initiated recently is really to satisfy the overall exposure number required per ICH guidelines which, as you know, is 1,500 for a chronic product. We -- and as I stipulated on the call and you're aware, the maximum exposure time we anticipate there is going to be 12 weeks of treatment for those patients. We will satisfy the long-term safety exposure numbers that Chris queried about earlier with both our open-label 52-week extension study initiated in 2017 and the open-label safety extension studies we have as part of our design on both KALM-1 and KALM-2 pivotal. So that's -- those are how we satisfy both long-term exposure numbers and total safety exposure numbers.

On the KALM-2 enrollment, as you know, we don't like to guide every quarter on exactly where we are there. But enrollment is according to plan, and we're still getting -- we're going to have top line data by the end of this year. And when we have the appropriate data analyzed for interim assessment, as we have done with our KALM-1 study, we'll certainly guide as to the IDMC recommendations when we finish that particular interim. So obviously, we're going to see top line data by the end of this year, second half of the year, and our interim is going to occur within the next 2 quarters.

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Operator [14]

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And our next question comes from the line of David Amsellem with Piper Jaffray.

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David A. Amsellem, Piper Jaffray Companies, Research Division - MD and Senior Research Analyst [15]

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So I know, Derek, you're planning to provide more color on the design of the liver study and the atopic derm study when you initiate them. But can you -- on the liver study, can you give us a rough sense of the specific patient subgroups you're going to look at? And what has the FDA told you in terms of specific populations since you've just talked about liver in terms of broadly chronic liver disease? That would be helpful to understand. So that's number one. And then number two, in atopic dermatitis, we're seeing more and more penetration of biologics in that setting, and they do work fairly well on pruritic symptoms. So are you worried at all that as that market evolves that the opportunities specifically in AD may not be as attractive as you once thought? Help us understand your thought process there.

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [16]

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David, thanks for that. So we'll take the second question first on atopic. So our belief there is you're correct -- well, as of today, there's only 1 approved biologic with an atopic label and that's DUPIXENT. But here, that label is focused on moderate to severe atopic patients. And as far as I'm aware, all the biologics that are in development are also focused on that subgroup. And what is clear is that moderate to severe pruritus occurs not only with moderate to severe pathology but also with mild to moderate pathology. And as you're well aware, David, the majority of atopic patients, probably 80%, fall within the mild to moderate category.

So I believe there's still a big opportunity there. As you know, patients are somewhat reluctant even in the moderate to severe level to take a biologic if there was an oral alternative available. And you're correct that some of these biologics do have some efficacy when it comes to pruritus, but that tends to be a delayed response related to altering the inherent immunology there for that disorder. So I think we'd see a more rapid response with an Oral KORSUVA product. So that's our belief in terms of the opportunity in atopic.

And the first question on liver, so when we look to our Phase I safety and PK study, we did look at all gradations of liver disease through A to C. And as you're well aware, pruritus occurs in a variety of pathologies associated with liver patients, including viral infections, NASH itself, cirrhosis. But it's particularly very on, if you like, in primary biliary cholangitis. And at this point, it's very likely that, that would be the subgroup of patients we look to. They tend to have a more consistent, more severe pruritus, and there's certainly a very high clinical need there for these patients. So at this point, it seems likely that would be the patient group we'd focus on.

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Operator [17]

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And our next question comes from the line of Annabel Samimy with Stifel.

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Annabel Eva Samimy, Stifel, Nicolaus & Company, Incorporated, Research Division - MD [18]

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Just wanted to ask about the upcoming Phase III trial. So it's pretty well designed. It's got very high-level powering and the same placebo assumptions as in Phase II. But can you tell us what kind of expected variance that would translate into to reach statistical significance? And is there any specific variance that will be viewed by clinicians as clinically relevant? So that's the first question.

And the second is can you help us understand the site overlap between KALM-1 and KALM-2 and how well the -- or how predictive KALM-1 could be of KALM-2? And then just really quickly, I missed the update numbers -- the update on the safety numbers. How many are in -- how many have completed 6 months and how many have completed a year?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [19]

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Annabel, thanks for that. So you snuck in 3 questions. We'll do the last one first. So the safety exposure levels on the long-term safety trial is through 150 at 6 months and 40% of those are through the 1-year exposure level. In terms of the clinical relevance on the 3-point -- so you recall that part of the condition of breakthrough designation is to satisfy the requirement that the change we see in these patients in terms of reducing their moderate to severe pruritus is clinically significant. And we analyzed basically our Phase IIb data using the standard statistical anchored approach where we look at NRS differences correlated with quality of life changes per patient and just a standard analysis to define clinical meaningfulness. And when we did that, we see a 3-point reduction, actually a little less than that, as being the threshold for clinical meaningfulness for a CKD-hemodialysis patient with moderate to severe pruritus. So in terms of what's a clinically significant reduction of U.S. and the FDA's view would be if we have statistical significance on your primary end point, that would be significant for that patient group. So that's where we are in clinical significance. And then I forgot what your second question was, Annabel.

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Annabel Eva Samimy, Stifel, Nicolaus & Company, Incorporated, Research Division - MD [20]

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Just can you remind us what the site overlap is between KALM-1 and KALM-2 and how predictive 1 trial could be for the next?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [21]

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Yes, so the latter part of that -- first of all, there's no site overlap between KALM-1 and KALM-2. We're very careful on that to maximize our enrollment. But the second part of that, of course, we're looking at the same pathophysiology, the same patient class. And so we assume the mechanism is going to be similar there in terms of the antipruritic effect for KORSUVA. So it seems likely that if we see significant effects in KALM-1, that would be good read-through to KALM-2. We recognize there might be some variability. We're using different countries for KALM-2. We're using more sites, and that's all being built into the power assumptions for KALM-2, which is why as you know for KALM-2, we also have an interim conditional power assessment at 50% enrollment. Now of course, we're going to guide after we complete that particular interim also. So should be good read-through. We recognize there might be variability differences as there are with all clinical trials, but we think we can accommodate that with the powering assumptions we made for KALM-2.

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Operator [22]

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And our next question comes from the line of Alan Carr with Needham & Company.

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Alan Carr, Needham & Company, LLC, Research Division - Senior Analyst [23]

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A couple of them. In the eyes of the FDA, are there any particular secondary end points that you think are particularly critical in the -- [actually] behind the obvious one [in the] primary end point? And then also can you give us an update on the commercial prep? What's the strategy and timing around that?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [24]

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Yes. Thanks, Alan. So as you know, primary end point is the most important here for the FDA and our label ultimately, so that's the main end point for us. We don't anticipate any other quality of life end points will make it to the label level. We are looking at a 4-point reduction also since that's been a well-used end point in non-CKD pruritus trials. So we will have that data to use with the FDA and discussions there. But the main end point as always is our primary, and that's the main end point we need for our label. What was your second question, Alan?

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Mani Mohindru, Cara Therapeutics, Inc. - CFO & Chief Strategy Officer [25]

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Launch [prep].

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Alan Carr, Needham & Company, LLC, Research Division - Senior Analyst [26]

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One on commercial...

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [27]

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So a little early for launch prep. We'd like to get through at least the first Phase III trial and confirm efficacy there. But we have started the very initial stages of that and modeling out what we see as necessary in both sales force and economics to launch this product. And that's something we're going to talk about a little later in the year once that matures a little bit beyond the planning stages.

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Alan Carr, Needham & Company, LLC, Research Division - Senior Analyst [28]

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Can you give us a sense of what commercial prep, I guess, is triggered after a first positive Phase III or after meeting with the FDA? Any guidance around that? Or is it just too early?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [29]

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Yes, it's really logistics preparation and making sure we have everything in line for the necessary implementation of logistics across our various departments not just clinical, but we're going to be adding more people on our MSL groups obviously and then HR and legal and financial. So it's preparation, the switch from development to commercial organization, that kind of planning initially. And then as we get closer to the NDA, and I've talked about this before, we already have ideas on the size of sales force here. We think it's very economical, affordable for Cara. We have some assistance in our U.S. launch with our Vifor Fresenius license arrangement. And so all of that we'll detail a little later in the year once we get past the Phase III data.

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Operator [30]

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And our next question comes from the line of Esther Hong with Janney.

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Esther Lannie Hong, Janney Montgomery Scott LLC, Research Division - Director of Biotechnology [31]

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So first question, can you speak to the severity of the CKD patients on hemodialysis who are enrolling in the study, how long have these patients been on dialysis? And then second, assuming positive IV KORSUVA trials, what other studies are expected to be required for ex-U. S. approval? And then along the same vein, under the terms of your agreement with Vifor Fresenius, what's the breakdown of the remaining $470 million in regulatory and commercial milestones?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [32]

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Yes. Esther, thanks. Just to the last one quickly because I have it in my mind. So the $470 million, $30 million of that is regulatory and $440 million is commercial, obviously [tiered] by sales ex-U. S. And then as regards to the patients and severity of the pruritus really, from our phase -- I don't have that data from the ongoing Phase III. But we know it looks similar in terms of their histories. And from our Phase IIb data, the average patient was 5 to 6 years on hemodialysis and moderate to severe pruritus. So we're seeing similar patient types recruited and enrolled into our Phase III trial as we'd seen in our Phase II.

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Esther Lannie Hong, Janney Montgomery Scott LLC, Research Division - Director of Biotechnology [33]

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Great. And then for ex-U. S. filings, what...

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [34]

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Oh, yes, ex-U. S. So European filing -- as you know, we can file in Europe. There's no approved product in Europe. For that, we don't need a comparator study. So we'll be using the U.S. package. In fact, our partner Vifor Fresenius will be using the U.S. package for filing in Europe.

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Operator [35]

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And our next question comes from the line of François Brisebois with Laidlaw.

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François Daniel Brisebois, Laidlaw & Company (UK) Ltd., Research Division - Healthcare Equity Analyst [36]

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Just a couple here. I was wondering, you talked about just quickly the dual mechanism, neuronal versus anti-inflammatory aspects to it. Is there -- has there been any evolution understanding of which part might be more important and for which disease you can attack? Just you mentioned NASH, you mentioned PBC and maybe going after PBC before NASH as a population. Is there any mechanistic reasoning? Or is it really that patient population seems to have an issue with pruritus at the time being?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [37]

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Yes, Frank, thanks for that. So yes, it's really the latter when it comes to liver patient choice. The PBC pruritus tends to be more severe, more consistent and that's the reason we think we could go after that. We're not the first people to define the anti-inflammatory effect via the kappa receptor. There's a great deal of literature about that. We know the cell types involved and mechanistically, we know we can reduce and other compounds had been shown to reduce the proinflammatory cytokine pathways there.

So I think that is an important part of the mechanism here. And as you know, we have shown in our Phase IIb trials we can see sustained antipruritic effects that last through 8 weeks, and we think a lot of that has to do with the anti-inflammatory benefits. There may well be a more an immediate benefit from the inhibition of the sensory afferents in the particularly epidermis and dermis that relay the pruritus. But I think ultimately, it's that dual mechanism that's going to be important here. And since we find kappas on a whole range of immune cells, the point we were making is regardless of whichever cytokine pathway is to the floor and whichever pathophysiology, that should be a mechanism that should be effective across conditions rather than perhaps a specific biologic targeting a specific cytokine that we know is elevated in a particular subgroup of patients.

So that's the mechanism that I think the patient can benefit from. It should be pan-antipruritic, if you like. And of course, that's something hopefully we're going to produce more data on in terms of mechanism and the anti-inflammatory effect as we run through these larger trials where we are looking at biologic markers as part of our exploratory measurement. So we hopefully will have that data in future calls to talk about, Frank.

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François Daniel Brisebois, Laidlaw & Company (UK) Ltd., Research Division - Healthcare Equity Analyst [38]

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All right. And I just -- so there's no -- is there for you guys kind of a reason why maybe things wouldn't translate as well from PBC to NASH just because it seems like -- obviously, drugs aren't approved yet for NASH, but it seems like the pruritic effect is larger than may be expected. So is there any reason when you speak to hepatologists that this might be easier in PBC? Or we'll just have to see for that?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [39]

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Yes. No, so look, there's certainly a great need. That's the message we get in speaking to hepatologists and KOLs that there's a great need for effective antipruritics for that patient population. It looks as though we have more consistency in PBC. So for us, that makes sense as the first group we look at. It doesn't mean that ultimately we won't look at other groups within that heterogeneous population. But that consistency of response is important for our first clinical trial, and that's where we're going to focus initially.

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Operator [40]

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And I'm showing no further questions. And I would like to turn the conference back over to CEO, Derek Chalmers, for closing remarks.

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [41]

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So thank you, everybody. Thanks for participating in today's call. I'd like to thank particularly the Cara team for all their hard work and commitment. I'd like to thank our investors, our study investigators and most importantly, the patients who participate in our ongoing large clinical trials. And we look forward to talking to everybody again very soon. So thank you very much, everybody.

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Operator [42]

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Ladies and gentlemen, this concludes today's call. Thank you again for your participation. You may now disconnect. Have a great day.