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Edited Transcript of CARA earnings conference call or presentation 7-Aug-18 8:30pm GMT

Q2 2018 Cara Therapeutics Inc Earnings Call

Shelton Aug 22, 2018 (Thomson StreetEvents) -- Edited Transcript of Cara Therapeutics Inc earnings conference call or presentation Tuesday, August 7, 2018 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

* Michael Schaffzin

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Conference Call Participants

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* Alan Carr

Needham & Company, LLC, Research Division - Senior Analyst

* David A. Amsellem

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

* Kenneth Eugene Trbovich

Janney Montgomery Scott LLC, Research Division - MD of Specialty Pharmaceuticals

* Nicholas Carl Rubino

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

* Oren Gabriel Livnat

H.C. Wainwright & Co, LLC, Research Division - MD & Senior Healthcare Analyst

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Presentation

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Operator [1]

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Good afternoon, and welcome to Cara Therapeutics Second Quarter 2018 Financial Results Conference Call. (Operator Instructions) Please be advised that the call is being recorded at Cara's request. I would now like to turn the call over to the Cara team. Please proceed.

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Michael Schaffzin, [2]

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Good afternoon, this is Michael Schaffzin with Stern Investor Relations, and welcome to Cara Therapeutics second quarter 2018 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 in 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 company's planned clinical trials; the potential results of ongoing and planned clinical trials; future regulatory and development milestones for the company's product candidates; the potential for the company's product candidates to be alternatives in the therapeutic areas investigated; and the company's 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 described -- risks are described more fully in Cara Therapeutics' filings with the Securities and Exchange Commission, including the Risk Factor section of the company's annual report on Form 10-K for the year ended December 31, 2017, and its other documents subsequently filed with or furnished through the Securities and Exchange Commission.

Participating on this call are Dr. Derek Chalmers, Cara President and CEO; and Dr. Mani Mohindru, our 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. Thanks for being with us on the call this afternoon. So during the second quarter, we've certainly made significant progress, executing on our overall corporate strategy of advancing KORSUVA injection or I.V. CR845 into pivotal Phase III trials for CKD-associated pruritus in hemodialysis patients, whilst also working on expanding the clinical application for KORSUVA into additional renal, hepatic and dermatological patient populations where pruritus continues to be an unmet clinical need.

In recent months, we've also signed an important strategic license agreement with Vifor Fresenius Medical Care Renal Pharma or Vifor Fresenius that positions us well for the commercialization of KORSUVA injection in hemodialysis patients essentially worldwide.

We've also completed a successful follow-on offering of approximately $92 million to fund the expansion of Oral KORSUVA into additional pruritus indications, and we've reported on positive data with I.V. CR845 in postoperative pain and postoperative nausea and vomiting.

So what I'd like to do is, during the call today, I'll provide some additional color on each of these specific areas.

Let me start with KORSUVA injection in hemodialysis patients with moderate-to-severe pruritus. Our lead program, of course, for which the FDA granted us breakthrough therapy designation in 2017. As we've discussed previously on these calls, our first Phase III efficacy trial or KALM-1 trial began enrolling patients back in January of this year. And we're very pleased to announce today that we've dosed the first patients in our second Phase III global trial of KORSUVA injection for this indication.

Both Phase III trials are designed to investigate the efficacy of KORSUVA injection at a dose of 0.5 micrograms per kilo versus placebo, administered TIW or 3 times per week after scheduled dialysis sessions over a 12-week total treatment period.

The primary efficacy endpoint 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 itch intensity score measured on a standard numerical rating scale.

Now as a reminder, in a post-hoc analysis of our completed Phase IIb trial, where a proportion of patients with an improvement from baseline in the weekly mean worst itching score of greater than or equal to 3 points at week 8 was statistically significantly higher in the KORSUVA 0.5 microgram dose compared to the placebo group, being 64% in KORSUVA-treated patients versus 29% in placebo.

Secondary endpoints in the Phase III trial again match our Phase II design and will measure aspects of itch related to quality of life, using validated self-assessment scales of Skindex-10 and the 5-D itch as well as the proportion of patients achieving a greater than or equal to 4-point improvement from baseline and the weekly mean of the daily worst itch intensity scores at week 12.

We're pleased to report today that enrollment is progressing well for the KALM-1 trial, with 56 U.S. sites now active for enrollment. Dosing of patients in the KALM-2 trial, as I said earlier, is underway, and we expect announced data readouts from both our KALM-1 and KALM-2 trials in 2019.

Also in Q2, we were very happy to execute a strategic license agreement for I.V. KORSUVA for the treatment of CKD-associated pruritus in dialysis patients, with Vifor Fresenius Medical Care Renal Pharma, a global leader in providing treatment and services for dialysis patients.

Under the terms of this deal, Vifor Fresenius will commercialize KORSUVA injection for dialysis patients worldwide, excluding the U.S., Japan and South Korea, while Cara retains all commercial rights in the U.S. The key financial terms of the agreement include an upfront payment of $70 million, comprising of $50 million in cash and $20 million in equity investment at a premium price. Also, up to $470 million in regulatory and commercial milestones and tiered double-digit royalties on KORSUVA sales in the licensed territories.

In addition, Cara and Vifor Fresenius will co-promote KORSUVA injection in U.S. Fresenius dialysis clinics under a 50-50 profit-sharing agreement, with all U.S. sales booked by Cara. Now we believe this particular co-promotion agreement leveraging an established dialysis-focused sales force will add significant launch momentum in the U.S. for KORSUVA injection, if approved.

With respect to potential reimbursement of KORSUVA injection in the dialysis setting once launched, we're also encouraged by the recently announced 2019 proposed rulemaking update from CMS, proposing that all new injectable or I.V. equivalent drugs approved for use in the dialysis patient setting after January 2019 would automatically be reimbursed out with the ESRD bundle payment at ASP for a period of 2 years, as part of the Transitional Drug Add-On Payment Adjustment or TDAPA path system.

Moving on from I.V, CR845 to our Oral KORSUVA program in pre-dialysis stage III-V CKD patients with moderate-to-severe pruritus. Current CDC estimates indicate that approximately 50% of diagnosed CKD patients are stage III-V, and an estimated 25% of these suffer from moderate-to-severe CKD-associated pruritus.

In July of this year, we announced we initiated a Phase II trial in this patient population, examining the safety and efficacy of 3 tablet strengths of Oral KORSUVA, 0.25 milligrams, 0.5 milligrams and 1 milligram administered once daily versus placebo and approximately 250 stage III-V CKD patients with moderate-to-severe pruritus. Site initiations and enrollment are progressing as planned. And we look forward to updating you on this trial in our next guidance call.

Based on this mechanism of action mediated by kappa receptors, of course, on peripheral sensory nerves and certain immune cells, we believe that KORSUVA has the potential to be an important symptomatic treatment for pruritus across a range of clinical conditions. And throughout the remainder of this year, we plan to expand our clinical activities with Oral KORSUVA beyond CKD into additional patient populations, such as those with chronic hepatic or dermatological conditions, in which treatment resistant pruritus also remains a significant unmet medical need.

The first opportunity we're pursuing is in chronic liver disease-associated pruritus. And earlier this year, we initiated an open-label Phase I PK and safety trial to determine the appropriate tablet strengths to take forward into Phase II. And we aim to initiate that Phase II trial later this year or early in 2019.

Finally, moving away from pruritus and into the acute postoperative setting. During Q2, we also reported positive top line results from our adaptive Phase II, III trial of I.V. CR845 in postop patients. This adaptive trial was a randomized double-blind placebo-controlling trial designed to evaluate analgesic efficacy and safety of 2 doses of I.V. CR845 0.5 and 1 microgram per kilo versus placebo, given at prespecified intervals both pre and postsurgery in 444 patients undergoing abdominal surgery.

CR845 achieved statistical significance for the primary endpoint of pain relief over 24 hours postsurgery, with a 1 microgram per kilo dose versus placebo, and then additional improvement in pain AUC results was statistically significant for both the 0.5 and the 1 microgram per kilo doses over 0- to 6- and the 0- to 12-hour periods postsurgery.

I.V. CR845 also exhibited statistically significant effects on secondary endpoints related to postoperative nausea and vomiting. At 6 and 24 hours after baseline dose postsurgery, there were statistically significant improvements in PONV impact scores with both doses of I.V. CR845 compared to placebo. And additionally, total use of antiemetic medication over the first 24-hour period postsurgery was significantly different from placebo with both doses of 845, supporting CR845's overall efficacy in reducing nausea and vomiting in the postop period.

The percentage of patients who did not take any antiemetic medication over 24 hours was 56% for placebo compared to 70% for 845 0.5 microgram dose and 81% for 845 1 microgram per kilo dose. And overall, there was a 73% reduction in the incidence of patient-reported vomiting in the group receiving the 1 microgram per kilo dose.

So given the well-established relationship between postoperative nausea and vomiting and delayed patient recovery, and the notable ability of I.V. CR845 to robustly diminish PONV in this trial, we're currently evaluating the best next steps for this program, including discussions with the regulators as to the optimum path forward. And we look forward to updating you on those discussions when they occur.

So I'd now like to turn over the call to Mani Mohindru, who will discuss our financials for the second quarter. 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 for the second quarter of 2018 can be found in our press release issued today after the market closed.

For the second quarter of 2018, we reported net loss of $17.2 million or $0.52 per basic and diluted share compared to a net loss of $9.3 million or $0.29 per basic and diluted share for the same period of 2017.

During the second quarter of 2018, we recognized $2.9 million of license and milestone fee revenue related to the license agreement with VFMCRP or Vifor Fresenius. There was no license and milestone fee revenue recognized during the second quarter of 2017.

R&D expenses were $17 million in the second quarter of 2018 compared to $7 million in the same period of 2017. The higher R&D expenses in 2018 were primarily due to a net increase in clinical trial costs as well as increases in stock comp expense and R&D personnel-related costs.

G&A expenses were $3.7 million during the second quarter of 2018 compared to $2.7 million for the same period of last year. The increase in 2018 was primarily due to increase in stock comp expense, professional fee, payroll and related costs for G&A personnel.

Other income was $467,000 in the second quarter of 2018 compared to $331,000 for the same period of 2017, resulting from higher average balance of investments in the 2018 period.

At June 30, 2018, cash, cash equivalents and marketable securities were $132 million compared to $96.2 million (sic) [$92.6 million] at the end of 2017. The increase in the balance of cash, cash equivalents and marketable securities primarily resulted from cash provided by operations of $22.6 billion (sic) [$22.6 million], which included upfront cash payment from Vifor Fresenius, proceeds of $14.6 million from the sale of common stock to Vifor Fresenius in connection with the license agreement and $1.7 million from the exercise of stock options.

Additionally, in July of 2018, we raised approximately $92 million from net -- in net proceeds from a public offering of 5.175 million shares of common stock.

Turning to our financial expectations. Based on timing and projected costs of our clinical development plans, we expect that the existing cash, cash equivalents and marketable securities, as of June 30, 2018, as well as the $92 million from the offering in July 2018, will be sufficient to fund our anticipated operating expenses and capital expenditure into 2021 without giving effect to any potential milestone payments under the existing collaborations.

I'll now turn call back over to the operator for Q&A.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from David Amsellem of Piper Jaffray.

Our next question comes from Annabel Samimy.

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Nicholas Carl Rubino, Stifel, Nicolaus & Company, Incorporated, Research Division - Associate [2]

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This is Nick Rubino on for Annabel Samimy. It's early to discuss, but what is the opportunity that you can take positive data in vulnerable populations such as CKD patients and CLD patients and potentially extrapolate the oral into a larger pruritus program, such as atopic dermatitis or psoriasis? It looks like kappa hit several areas in the neuro pathway for itch. So we could possibly be seeing a more ideal target for the symptoms of itch or pain in these conditions?

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

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Yes. Thanks, Nick. That's a great question. It's actually, completely in line with our thought process here on the mechanism for KORSUVA. We do believe that based on the mechanism, as I pointed out, on sensory nerve endings, if you like, at the end stage of the pruritus pathway as well as block and release of certain immune molecules directly in the skin, that it's likely that KORSUVA would have effect across clinical populations. We've certainly seen that with older molecules in the clinic, now [peurophone] data in Japan has shown effectiveness not only in CKD pruritus, but also in various liver disease-associated pruritus. So certainly, I believe that mechanistically there should be a PAN antipyretic molecule, and it's our aim to essentially prove that empirically. So this year we'll be moving from CKD into CLD. And we'll announce, most likely in our next guidance call, which dermatological population we're also going to examine with the molecule. So yes, we believe mechanistically this should be effective across populations.

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Nicholas Carl Rubino, Stifel, Nicolaus & Company, Incorporated, Research Division - Associate [4]

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Great. And a follow-up if I may. For pain, what do you think the biggest hurdle is for you to continue developing a kappa opioid as a pain product? Is it that the FDA makes pain trials difficult to conduct? And are there other pain indications that might be more amenable to development?

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

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Yes. I don't think there's any particularly unusual hurdles there. The issues with placebo probably apply equally to pain and pruritus. For us, it's a matter of prioritization, as to which labels we look at first, and at this point it makes much more sense based on our data, that we pursue the pruritus applications here since they are so large and broad in relation to 845. The postop setting, we certainly see analgesia, and as I pointed out in the call, we've also seen significant effects on postoperative nausea and vomiting, that's a significant unmet need in that setting. So part of our planned discussions with the regulators here will be discussing what's the most appropriate label there, that we might pursue at the end of the day for that particular setting. So ultimately, it's a prioritization issue for us. And we are prioritizing, if you like, the lowest-hanging fruit with the highest probability of success.

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Operator [6]

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Our next question comes from David Amsellem with Piper Jaffray.

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David A. Amsellem, Piper Jaffray Companies, Research Division - MD and Senior Research Analyst [7]

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So just had a couple of questions. First on -- and I realize this might be getting ahead of my skis here. But just in terms of commercialization in the CKD setting, the nondialysis setting and also the CLD setting. Can you just talk about your willingness to build a commercialization -- build a commercial sales force around those settings, particularly nondialysis? Talk about how you're thinking about the call audience and ultimately just the rough contours of what your -- what a commercial organization would look like? That's number one. And then the number two, and I apologize, you may have addressed this, but any additional thoughts or more recent thoughts on partnership opportunities in pain? And when we could see -- when is, I guess, the most appropriate time to partner it out in your view?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [8]

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Yes. Thanks, David. Maybe take the second one -- question first, since that's a shorter, easier answer there, is that we're constantly talking to prospective partners. And of course, we already have an ongoing partnership with Maruishi in Japan that encompasses acute pain, and that's another avenue we might pursue, as we pursue a label in relation to postop. But we're certainly going to talk about any mature situations when they reach finality and we have an agreement to talk about, but we're constantly in discussions with prospective partners in that regard. As to the first question on CKD nondialysis, there I thought -- certainly you're right, we're a little bit ahead of the game here, and then that's a couple years behind or at least a year behind our dialysis application for 845. But our thoughts there is that CKD-associated pruritus, of course, is a specialty. There's about 7,000 nephrologists in the U.S., so not an incredibly large number for a small company to take on. We already have some idea of sales force requirements from our modeling for the hemodialysis application there. And in rough terms, it looks like we can cover the U.S. with a sales force that could -- that's certainly under 100 in terms of reps. So we think that's entirely affordable for us. And of course, there would be some synergy from detail in our I.V. product, specifically for hemodialysis and then following up with an additional formulation that's applicable to early-stage CKD patients. So that particular indication we think is entirely viable for a smaller company. Broadening beyond that, which I think is where you're heading into liver and finally dermatological, and it's likely, sequentially, that's how this would look for us in a development sense. Then it may require partnerships there to reach these broader disciplines and a PCP-type sales force. But that's something we'll get to when the time's right. At least with these initial indications, we think that's entirely viable for us.

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David A. Amsellem, Piper Jaffray Companies, Research Division - MD and Senior Research Analyst [9]

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Okay. And if I just may sneak in a follow up in the chronic liver disease setting. And I realize that's a bit earlier stage, but assuming you get a good signal here, is it your view that the 3-point worst itch responder analysis is going to be the primary outcome measure, as is the case in CKD? Or should we think about it as a 4-point analysis akin to what we're seeing in the dermatologic setting?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [10]

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Yes, that's a great question, David. So we should say out-front that we came to our endpoint for our CKD-associated pruritus and hemodialysis patients based on empirical analysis. So that was part of our breakthrough application to look at our data in terms of analyzing what extent of reduction in itch corresponds to clinically meaningful improvement in QoL scores. And presenting that in a statistical manner, that made sense in terms of identifying appropriate primary endpoint. And the number there is approximately 2.5 in that CKD population, which we ran it to 3. It's actually very difficult to find an analogous empirical approach for any of the dermatological conditions. And this might be an area that we may look at, as we advance into those particular subpopulations. Certainly, nothing available in liver. The dogma, you're correct [to the minute] in that division is a 4-point difference. But again, that's really something that isn't based on an empirical analysis and that might be something we address as we move into these various clinical populations.

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David A. Amsellem, Piper Jaffray Companies, Research Division - MD and Senior Research Analyst [11]

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Okay. And then just circling back to my commercialization question, just in the liver setting, detailing to liver specialists or gastroenterologists more broadly, is that something that would be in the cards for you? And what kind of headcount would you need to support that indication?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [12]

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Yes, you're way ahead of us there, David, and I do admire your forward-looking thinking, but we haven't really modeled all the way through in liver at this point. So CKD is the next couple of things up, hemodialysis first and then CKD pre-hemodialysis and then those others, we'll get to as we get there. But as you know, there are a significant number of companies interested in liver disease and model into that market space. I don't think it would be terribly difficult to find a commercial partner.

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Operator [13]

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Our next question comes from Alan Carr of Needham & Company.

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Alan Carr, Needham & Company, LLC, Research Division - Senior Analyst [14]

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Can you tell us a bit more about your expectations for what's needed for U.S. regulatory approval in hemodialysis patients? Is it your thinking that KALM-1 is enough? Or do you need both of them? And what sort of supportive data, including safety data and that sort of thing, will you need for an NDA submission?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [15]

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Yes. Alan, good question. So as you know we do have breakthrough designation for KORSUVA for CKD-associated pruritus in HD patients. And so a possibility there, not something that we're planning towards, but it may be possible to file using one Phase III trial to support effectiveness, of course, if the data is statistically persuasive and consistent across endpoints. So that's something, obviously, we need to wait and look at the unblinding and the data readout there, but it is a possibility. And as you know, that has been something that's been successful for other breakthrough medications in other divisions. So that is a possibility and we will explore that possibility in due course, but we're not planning on that. And so that was the reason to expand and make sure we're going to have 2 RCTs done and ready for submission. We've also planned, as you know, from last year, to reach our requirements on safety exposures. And we began our long-term 1-year safety trial in Q2 of 2017. That's advancing very well. We now have our first patients passing the 1-year mark in terms of exposure. So we think we're in good shape. Standard guidelines there, we're going to need 100 patients at 1-year, and we expect to have that certainly early in 2019. And so we're working towards exposure numbers that are around ICH standard guidelines, which is overall 1,500 with the idea that if we're pleasantly surprised by the division after our first Phase III trial then we'd certainly file with reduced exposure numbers per their guidance.

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Alan Carr, Needham & Company, LLC, Research Division - Senior Analyst [16]

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And then, are there any other limiting events or limiting efforts that are not clinical, that would preclude a filing or slow down a filing? What other efforts do you have underway there? Or are they in good shape?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [17]

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They're in good shape, is the short answer to that, Alan. There are no bottlenecks associated with preclinical studies.

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Alan Carr, Needham & Company, LLC, Research Division - Senior Analyst [18]

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Okay. And then, one other one around the pain program. You mentioned you wanted to have a conversation with the FDA. Can you go over that a bit more in terms of what your goal -- or what your proposal is? What you plan to propose and what your objectives are in this discussion with the FDA around the pain program?

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

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Yes. Look, I never like to discuss what we're going to discuss with the FDA. I prefer to discuss what we have discussed with the FDA. And when we have that guidance we will talk about it. But in broad strokes, we're interested in exploring the idea of label for that particular indication and what the design might look like if we were looking at postoperative nausea and vomiting in addition to pain as endpoints there. That would be the broad discussion we're looking to have with the regulators.

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Alan Carr, Needham & Company, LLC, Research Division - Senior Analyst [20]

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It's essentially -- I take it your objective there would to be see how much of these other endpoints, not related just to pain relief, but the other benefits would be included in the label. Is that what you're getting at?

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

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Yes, that would be part of discussions around exposure numbers already in the bag if you like for that particular patient group.

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Operator [22]

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Our next question comes from Oren Livnat of H.C. Wainwright.

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Oren Gabriel Livnat, H.C. Wainwright & Co, LLC, Research Division - MD & Senior Healthcare Analyst [23]

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I'm actually just curious about the clinical -- ongoing clinical trials, the Phase IIIs in the hemodialysis patients. I thought you might give us a heads up on the progress of enrollment, not specific numbers. But given the pace that you're seeing now, can you maybe give us a ballpark on when you think you might be able to make that conditional powering analysis? And also could you confirm whether you built a similar adjustment to the second Phase III?

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

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Yes, Oren. Yes, to the last question, we did. Both trials are designed in a parallel fashion. So the second trial also has a conditional power analysis at approximately 50%. So in answer to the first question, you're going to know the answer to the conditional power analysis completion when we've completed it. And you know, at that point, we'll also provide some more solid guidance on final readout, because as you pointed out, that analysis is going to take place at approximately 50% enrollment. So that'll be I think very useful guidance as to the final timeline for top line data.

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Oren Gabriel Livnat, H.C. Wainwright & Co, LLC, Research Division - MD & Senior Healthcare Analyst [25]

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All right. And if I could follow-up on pain again. It seems clear that things aren't that clear necessarily yet. But is there a scenario that you have in your mind -- or without telling us what that objective is, but is there a label or a hurdle that if the FDA says, yes, that makes sense, that you would really be interested in investing and pursuing it yourself? Or is your focus -- so I guess, laser -- are you so laser-focused on pruritus and pruritus-related indications at this point that almost whatever happens, it's just going to be a question of what kind of partnership and with whom you strike it?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [26]

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Yes. Well, look, I think we should have the discussion, so we know the lay of the land from the agency what label we're pursuing. How that looks in terms of endpoints. What they'd be looking for in terms of additional exposures beyond where we are, so we know the size of that program. And we're also doing a little bit of work in terms of end-user analysis for that particular indication here in the states. And once we have all that data combined, then we make a decision on how we move forward. Again, optimally, if we can use some cash from existing partnerships or we have new partnerships that focus on that, that may be the most ideal for us. But we'd rather get the answers to all these moving parts and then we'll make the decision on that.

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Operator [27]

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(Operator Instructions) Our next question comes from Ken Trbovich of Janney.

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Kenneth Eugene Trbovich, Janney Montgomery Scott LLC, Research Division - MD of Specialty Pharmaceuticals [28]

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I guess, Derek, I'll go back to the questions about enrollment just to make sure we're not missing anything. I think, historically, we've seen rapid enrollment with this type of study, regardless of whether it was Cara or its competitor enroll in those studies. And I don't see them as currently enrolling. So are there any obstacles at this point to enrollment that exist here in the U.S.?

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

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No. No, we have no specific issues in terms of -- that are any different than the issues you normally face and find in patients. And if anything, of course, as you know, we have the advantage of captured patients here who essentially have to attend dialysis clinics at least 3 times a week. So in that regard it is an advantage. We've expanded beyond the group we use for our Phase IIb, which was approximately 34 sites, up to close to 60 sites at this time. And as I said on the last guidance call, we ran that Phase IIb trial, which was 174 patients in approximately 7 months at that number of sites. We don't see any particularly new obstacles that may interfere with enrollment. And so far, as I said earlier, enrollment is progressing very well in that trial. So we expect, we'll have much more granular guidance for you on the next guidance call.

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Kenneth Eugene Trbovich, Janney Montgomery Scott LLC, Research Division - MD of Specialty Pharmaceuticals [30]

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Sure. And then, just with regard to the Vifor Fresenius partnership. Is there anything about that, that would either help or hinder enrollment as a result of that partnership?

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Derek T. Chalmers, Cara Therapeutics, Inc. - Co-Founder, President, CEO & Director [31]

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There is, at least theoretically, there is, that we should see some help there in terms of -- and I shouldn't -- I was slightly facetious. We are seeing help in terms of European sites related to that partnership. Most of our U.S. trial was underway in site selection. As you know, we started that much earlier, was mostly complete there. But in terms of European site selection, we're certainly seeing help with respect to our partners in that area.

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Kenneth Eugene Trbovich, Janney Montgomery Scott LLC, Research Division - MD of Specialty Pharmaceuticals [32]

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Okay. And then a question for Mani on the Vifor Fresenius side. Should we be looking at that partnership and sort of just modeling in, sort of, $6 million on a quarterly basis? Or is there anything unique about the accounting treatment for that, that we should be mindful of?

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Mani Mohindru, Cara Therapeutics, Inc. - CFO & Chief Strategy Officer [33]

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So, yes, I mean that's approximately right. We are going to recognize revenue proportionately to the R&D activities that we would be conducting to support the filing. So there could be a little fluctuation depending on when these activities get -- what proportion of these activities get completed in each quarter going forward.

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Kenneth Eugene Trbovich, Janney Montgomery Scott LLC, Research Division - MD of Specialty Pharmaceuticals [34]

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Okay. So it's not necessarily straight line over a fixed period of time?

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Mani Mohindru, Cara Therapeutics, Inc. - CFO & Chief Strategy Officer [35]

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The period of time is related to when these activities get completed. But the proportion that gets allocated in each quarter is related to the proportional amount of work done related with the acts of clinical trials. But there may be some fluctuations, but you're, more or less, in the range.

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Kenneth Eugene Trbovich, Janney Montgomery Scott LLC, Research Division - MD of Specialty Pharmaceuticals [36]

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In the ballpark. Okay. And then on the Maruishi front, is there any sense as to when they might begin, sort of, pivotal studies in CKD-aP, since it seems like that's the next milestone from a Maruishi perspective?

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

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Yes. No, we'll certainly guide to that, Ken. They're making good progress with their PMDA discussions. And we will guide to that when that occurs.

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Kenneth Eugene Trbovich, Janney Montgomery Scott LLC, Research Division - MD of Specialty Pharmaceuticals [38]

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Okay. And then, last question, Derek. I'm not certain to what extent this is something that you're doing or not, but I figured I'd ask just to clarify it. Is the formulation being tested in the open-label PK study the same oral formulation you used previously?

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

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Yes, it is. Yes, it is the same formulation.

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Operator [40]

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There are no further questions. I'd like to turn the call back over to Derek Chalmers for any closing remarks.

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

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Okay. Thank you, everybody, for participating in the call today. I'd also take this opportunity just quickly to thank our study investigators and our patient participants as well as their families, and who continue to support our development efforts for CR845 or KORSUVA. And with that, we conclude our remarks for today. And I look forward to updating everybody again soon. Thank you, everybody.

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Mani Mohindru, Cara Therapeutics, Inc. - CFO & Chief Strategy Officer [42]

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Thank you.

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Operator [43]

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Ladies and gentlemen, this concludes today's presentation. Thank you once again for your participation. You may now disconnect. Everyone, have a great day.