Cara Therapeutics, Inc.

Good afternoon. My name is Lateef, and I will be your conference facilitator. I would like to welcome everyone to the CARA Therapeutics first quarter financial results and update conference call. All lines have been placed on mute to avoid any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star and the number 1-1 on your telephone keypad. To remove your name from the queue, simply press star and the number 11 again. Please be advised that this call is being recorded. I would now like to introduce Matt Murphy, CARA's Manager of Investor Relations. Mr. Murphy, you may begin your call.

Thank you, Operator, and good afternoon. After market closed today, CARA issued a news release announcing the company's financial and operating results for the first quarter of 2023. Copies of this news release and the associated SEC filing can be found in the investor section of our website at www.caratherapeutics.com. Before we begin, let me remind you that during the course of this conference call, we will be making certain forward-looking statements about CARA and our programs based on management's current plans and expectations. These statements are being made under the Private Securities Litigation Reform Act of 1995, and are subject to risks and uncertainties. Actual results may differ materially due to various factors, and CARA undertakes no obligation to update or revise these statements publicly as a result of new information or future results or developments. Investors should read the risk factors set forth in CARA's 10-K for the year ended December 31, 2022, and any subsequent reports filed with the SEC including its Form 10-Q for the quarter ended March 31st, 2023. With that said, I'd like to turn the call over to Chris Posner, CARA's Chief Executive Officer. Chris?

Thanks, Matt. Good afternoon, everyone, and thank you for joining our call. With me today are Ryan Maynard, our Chief Financial Officer, and Dr. Joanna Consalves, our Chief Medical Officer. I'd like to start by giving a quick overview of what I'll address today. For the update on the Corsuva injection launch in the US, I will provide additional metrics that we are tracking to give better insight into the progress of demand and uptake. These will help to give some clarity and show the opportunity within the different customers and segments of the market. I will also review the launch progress in countries around the world. In addition, I will highlight our robust clinical stage pipeline and the advancement of our high-value development programs for oral diffelekephalin. I am pleased with the progress to date and can confirm that we continue to track to our previously communicated timelines. After that, Ryan will provide you with a financial update, and then we will open up the call to Q&A. I will begin with the launch of Corsuva injection in the U.S. For the first quarter of 2023, net sales for Corsuva were $5.7 million, translating into $2.8 million of profit recorded as revenue to us. Wholesaler shipments to dialysis clinics more than doubled quarter over quarter and reached 46,000 vials. 64% of these vials were shipped to Fresenius or FMC clinics, with the remainder split between DaVita and the other dialysis organizations. This increase in vial shipments suggests a meaningful acceleration in demand. Anecdotal feedback on Corsuva from both providers and patients continues to be highly positive, supporting this expansion in breadth and depth in its utilization. At FMC, orders more than tripled quarter to quarter reaching 30,000 vials. By the end of the first quarter, 500 FMC clinics or 18% had placed reorders, up from 7% of clinics at the end of Q4. More importantly, 1,500 clinics or 56% of FMC clinics had dosed at least one patient, up from 29% of clinics at the end of Q4. total patient demand remains difficult to assess without specific information about the levels of inventory remaining at individual clinics. However, we continue to see significant growth in the number of FMC clinics exhausting their third quarter 2022 bolus inventory and expect that the majority of the FMC clinics will be in a reorder mode in the second half of this year. At DaVita, demand growth continues to be steady. At the end of first quarter, 300 clinics or 11% of DaVita clinics had ordered Corsuva. That's up from 7% of clinics at the end of Q4. Reorder rates among these clinics remain very encouraging with 70% placing repeat orders. Given the on-demand approach at DaVita clinics for ordering Corsuva, the growth in clinic orders represents a good proxy for the growth in patient demand. At midsize and independent DOs, Corsuba continues to perform well. At the end of the first quarter, 13% of these clinics had placed orders, and that's up from 11% at the end of Q4. In addition, 66% of these clinics have placed repeat orders. Now, the strongest performance to date amongst this group has been at USRC, and that's the largest of the midsize DOs. Roughly 66% of clinics have ordered Corsuva, and 72% of these clinics have placed repeat orders. Stepping back and looking at the big picture, Corsuva's overall market penetration leaves significant room for growth, with a vast majority of the market still untapped. To get there, CSLV4 continues to make progress building the market, navigating the idiosyncrasies of each segment across the entire deal landscape. This is reflected in key trends this quarter. Clinic orders doubled quarter to quarter. Almost 60% of FMC clinics are dosing a patient, and each segment is seeing an increase in clinics ordering the product. We remain confident. and our partner CSLB4 remains fully dedicated to capturing the latent upside in this market and maximizing the commercial potential of Corsuva in the long term. Additionally, we are working in close collaboration with the kidney community to help CMS understand the need for a durable and appropriate reimbursement mechanism for Tdapa-designated products post their Tdapa period. We remain confident that additional funding will be made available for Tdapa-designated products, and we remain hopeful that a substantive and positive update will be released during this year's rulemaking cycle. Next, on the international front, the rollout of Capruvia in Europe continues to gain momentum. In the first quarter, Capruvia generated $1.2 million in net sales, translated into $125,000 of royalty revenues to us. Rollout has begun in four additional countries, France, Finland, the Netherlands, and Switzerland, bringing the total number of launch countries to seven. The initial feedback from patients and providers is, has been very encouraging and in line with the patient testimonials we have received in the US. We continue to expect the additional countries in Europe and other countries around the world to come online throughout the next 12 to 18 months once reimbursement is secured. Also, a decision from the UK National Institute for Health and Care Excellence, or NICE, is expected imminently. In Japan, we continue to expect a regulatory decision in the second half of 2023. As a reminder, approval in Japan would trigger a $2 million milestone payment to Cara. Last, but certainly not least, I'd like to briefly discuss our promising wholly-owned oral pipeline. Fundamentally, Cara is a development company, and we are committed to building our nephrology and medical dermatology franchises with oral difelocephalin. These efforts will drive us to our goal of being a differentiated company as the world leader in treating chronic pruritus in the long run. Enrollment in our phase three programs in pruritus associated with advanced chronic kidney disease and in atopic dermatitis is progressing as expected. We anticipate the internal readout of part A of our KIND 1 AD trial in the fourth quarter of this year with final top line results from this program in the first half of 2025. We also continue to expect top line results for our KICK Advanced Chronic Kidney Disease program in the second half of 2024. Startup activities for our Phase 2-3 program in Notalgia Parasetica kicked off in the first quarter of this year and they are progressing well. The MP program is tracking to the internal readout of Courage 1 Part A in the second half of 2024 and final top line results for the program in the first half of 2026. To summarize, we are continuing to work closely with CSLV to accelerate the uptake of Corsuva and we remain confident that these efforts will drive near-term growth. Additionally, We remain optimistic regarding CMS's future decision on the post-HDAPA funding mechanism and hope to see an update during this year's rulemaking cycle. Underscored by the highly positive feedback we are hearing from patients and providers around the world, we continue to believe in the long-term success of Korsuv injection. More importantly, we see tremendous value creation for CARA with our three late-stage programs with oral difalocethylene. We are fully committed to advancing these programs as rapidly as possible in order to maximize the potential of difalocethylene within our two therapeutic franchises. We look forward to providing you with updates on our progress throughout this year. Now I'd like to turn the call over to Ryan for additional details on our first quarter financial results. Over to you, Ryan.