Cara Therapeutics, Inc. (CARA) Earnings Call Transcript & Summary

Good morning, and welcome to Cara Therapeutics KALM-2 top line data conference call. [Operator Instructions] Please be advised, the call is being recorded at Cara's request. I would now like to turn the call over to the Cara team. Please proceed.

Good morning. This is Jane Urheim with Stern Investor Relations, and welcome to Cara Therapeutics KALM-2 top line data conference call. The news release became available earlier this morning 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 News and 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 plans, strategies and expectations for the future, including the planned timing of future regulatory submissions, the size of the potential markets that are potentially addressable for Cara's product candidates, including the pruritus market, and the potential for KORSUVA Injection to be a therapeutic option for CKD-aP. 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, 2019, and its other documents subsequently filed with or furnished to the Securities and Exchange Commission. Participating on this call are Dr. Derek Chalmers, Cara's President and CEO; Dr. Frédérique Menzaghi, Cara's CSO; and Dr. Jo Goncalves, Cara's CMO. I'll now turn the call over to Dr. Chalmers.

Great. Thank you, Jane, and good morning, everybody. Thanks for joining us on today's call. So this morning, we are very happy to report positive top line data from our KALM-2 pivotal Phase III trial in hemodialysis patients with moderate-to-severe pruritus. Before we go through the details on the data set, I wanted to remind you briefly that chronic kidney disease-associated pruritus, or CKD-aP, is an intractable systemic itch condition that occurs with high prevalence in patients undergoing hemodialysis. Current estimates support that approximately 40% of patients with end-stage renal disease have moderate-to-severe pruritus, and yet, there are currently no approved therapies in the U.S. or Europe for the condition. Our pivotal program for KORSUVA Injection in patients with CKD-aP includes 4 Phase III studies: KALM-1, a completed U.S. Phase III efficacy trial; KALM-2, our completed global efficacy trial, and the focus of this morning's call; and 2 open-label safety studies, 1 in the U.S. and 1 that is global. Many of you remember that we reported positive top line data from KALM-1 in May of last year, in which we observed a robust sustained antipruritic effect of KORSUVA Injection over the 3-month treatment period. We're very pleased to observe the similar antipruritic effect of KORSUVA Injection in our KALM-2 trial, as we outlined in our release earlier this morning. In addition, we currently have a safety database in line or exceeding the ICH guidelines for an NDA submission with over 1,500 total patient exposures, including more than 600 patients having completed 6 months of treatment and over 300 patients completed 1 year of treatment at the therapeutic dose of 0.5 micrograms per kilo. With these strong Phase III efficacy and safety data sets across our program in hand, we remain on track to submit an NDA in the second half of this year. With that, I'd like to commend the entire Cara clinical development team for delivering this data set according to schedule despite the logistical challenges of operating under the present COVID environment. And with that, I'll turn it over to Fred to walk through the top line data in more detail. Fred?

Thank you, Derek. Yes. Thank you, Derek. Good morning, everyone. As Derek mentioned, we are pleased to report positive top line data for KALM-2, our second Phase III pivotal clinical trial, which replicated the key efficacy results of our U.S. KALM-1 Phase III trial reported last year. Please turn to Slide 3. KALM-2 was a global trial and included sites from the United States, Europe and Asia Pacific. As a reminder, this was a multicenter, randomized, double-blind, placebo-controlled study to evaluate the safety and efficacy of KORSUVA Injection for the treatment of moderate-to-severe pruritus associated with chronic kidney disease in subjects undergoing hemodialysis. As indicated on the left of this slide on this diagram, using the 0 to 10 worst itching intensity Numerical Rating Scale, in the week prior to randomization, subjects had to report an average NRS score greater or equal to 5 to qualify. Upon randomization, subjects were administered either KORSUVA at a dose of 0.5 microgram per kilogram or placebo as an intravenous bolus injection at the end of their hemodialysis 3 times per week for 12 weeks. During these double-blind treatment periods, subjects were asked to continue to report their daily worst itching intensity score using the same NRS scale as well as to complete several questionnaire including quality-of-life questionnaire related to their pruritus. At the end of the treatment period, subject had the opportunity to continue into a 52-week, open-label safety extension. The primary efficacy endpoint was the proportion of subjects achieving at least a 3-point improvement -- a 3-point reduction from baseline with respect to the weekly mean of the daily NRS score at week 12. The secondary endpoint, including the proportion of subjects achieving at least a 4-point improvement from baseline in weekly mean of NRS score at week 12 as well as the proportion of subjects achieving a 3- or 4-point improvement in NRS score at week 4 and week 8. Impact of itch on quality of life was assessed with 2 complementary multidimensional questionnaire, the Skindex-10 and the 5-D Itch to evaluate disability due to itch. Moving to Slide 4. A total of 473 patients were randomized. Two subjects withdrew from the trial prior to receiving the study drug, which resulted in total of 236 subjects for the placebo arm and 235 subjects for the KORSUVA group. The discontinuation rate was 6% and 12% for the placebo and KORSUVA-treated group, respectively. These included 3% of subjects who discontinued due to adverse events in the placebo arm and 5.5% in the KORSUVA arm. On Slide 5, we are showing key baseline characteristics, which were well-balanced across treatment groups. Baseline demographic were similar, with a predominant number of white male subjects with an average age of 60. As you can see on this slide, on average, subjects who have been on hemodialysis for over 4.5 years and have been suffering from pruritus for an average of 3 years or more. Subjects were authorized to continue their anti-itch medication and were stratified for use or nonuse at baseline with approximately 37% of randomized subjects using these medications. Baseline average worst itching intensity score were matched at approximately 7-point on the 0 to 10 NRS scale. Baseline score for the 5-D and Skindex-6 -- Skindex-10, sorry, were also balanced, representing subjective assessment of impaired quality of life due to pruritus. For reference, the maximum worst score for the 5-D and Skindex-10 questionnaire is 25 and 60, respectively. Slide 6 is our primary endpoint, which was met. KORSUVA significantly decreased itch intensity with 54% of the subjects achieving a reduction of 3 NRS points or more from baseline to week 12 compared to 42% in the placebo group. The odds ratio indicated that patients treated with KORSUVA are 1.6x more likely to experience a 3-point change than placebo. Our prior psychometric analysis had established that the reduction of 3-point or greater on this NRS scale was clinically meaningful for this patient population. Looking at the time course of effect onset, a significant proportion of KORSUVA-treated subjects exhibiting a 3-point or greater reduction in NRS was evident as early as week 2 and sustained through the treatment period. Slide 7 is our first secondary endpoint on the sequential testing order. This is the proportion of subjects exhibiting a 4-point or greater reduction in NRS score at week 10. Here, 41% of KORSUVA-treated subjects achieved a 4-point reduction or more in NRS score versus 28% in placebo subjects. The odds ratio indicated that patients treated with KORSUVA are 1.8x more likely to experience a 4-point change than placebo. Statistical difference at this threshold level was evident as early as week 3 and consistent through the treatment period. Looking at the time course for mean NRS score change from baseline on Slide 8, we see that a statistically significant separation from placebo was evident at week 1 and was maintained through the remainder of the treatment period. This time course is analogous to what -- to that observed in KALM-1. Moving to quality of life, Slide 9. At week 12, KORSUVA-treated patients experienced a 12% and 29% improvement over placebo in the average total Skindex-10 and 5-D Itch score, respectively, which was not statistically significant based in part on sequential statistical analysis. Additional analysis of these results by subdomain, however, did indicate that each intensity-related domain in both scales was significantly reduced and consistent with the improvement reported with NRS measurement with p-value ranging from 0.003 to 0.47 (sic) [ 0.047 ]. On Slide 10, we're showing that KORSUVA was generally well tolerated with a safety profile consistent with the profile observed in KALM-1 and in the chronic kidney disease clinical program. Overall, the incidence of adverse events and serious adverse events were similar across the 2 groups. For adverse events, 68% of subjects on KORSUVA reported a treatment-emergent adverse event compared to 61% on placebo. For serious adverse events, 25% of subjects on KORSUVA reported a serious adverse event compared to 22% on placebo with infection being the most commonly reported SAE across the 2 groups. This is similar to what we observed in KALM-1 and consistent with this patient population. A total of 4 deaths occurred and were balanced between the 2 groups with 2 deaths reported in each arm. Deaths were due to cardiac arrest for the 2 patients in KORSUVA and cardiac failure and sepsis for the 2 patients on placebo. As mentioned previously, 5.5% of subjects discontinued the KORSUVA arm and 3% discontinued placebo treatment due to AE, with the most common reason for discontinuation for KORSUVA being gastrointestinal adverse events. Moving to Slide 11. The most commonly reported treatment adverse events at a frequency equal to or greater than 5% were gastrointestinal-related events, including diarrhea, vomiting, nausea, fall and dizziness. These events were mostly mild or moderate in severity and mostly result without evident clinical consequence. Based on these results, KORSUVA continued to exhibit an acceptable safety profile, especially in the susceptible population of patients who present with clinically significant coexisting condition. The subjects tolerated the drug well, and no new safety signals were detected in comparison to KALM-1 or other trials we conducted with patients undergoing hemodialysis. Moving to Slide 12. To conclude, both primary and key secondary endpoints were met for KALM-2 global Phase III pivotal trial of KORSUVA Injection with a rapid reduction in itch intensity that was sustained over a 12-week treatment period. KORSUVA was generally well tolerated with a safety profile consistent with the clinical trial conducted in support of this program, especially KALM-1, our prior U.S. Phase III pivotal trial published last year. The successful outcome of KALM-2 replicate the efficacy of KORSUVA previously reported with KALM-1 and, as a result, support the NDA submission of KORSUVA Injection for the treatment of moderate-to-severe pruritus in hemodialysis patients, which is planned for the second half of 2020, as previously guided. Finally, on Slide 13, we would like to thank all the investigators and patients who participated in this study and provided support for this program. With that, I'd like to pass the call back to Derek. Thank you.

Thank you, Fred. So to wrap up then, we believe we have a strong, compelling data set across our pivotal Phase III program for KORSUVA Injection to support our NDA submission in the second half of this year. And we're undertaking key pre-commercial activities to support commercialization of KORSUVA Injection in the U.S. in the coming year. We have also established commercial license agreements in Japan, South Korea and the European Union. In the EU, as many of you know, we have an agreement with Vifor Fresenius, which allows us to leverage their broad reach to dialysis patients across Europe. In addition, we believe the co-promotion and profit sharing arrangement we've established in U.S. Fresenius clinics with Vifor Fresenius will help build momentum for KORSUVA Injection launch here in the U.S. We are very, very pleased with the KALM-2 top line data and believe KORSUVA Injection has the potential to serve as the first effective treatment option for many hemodialysis patients suffering with moderate-to-severe pruritus. Now we're happy to answer any questions you may have. So I'll turn it back to the operator. Operator?

[Operator Instructions] Our first question comes from Chris Howerton with Jefferies.

Congratulations on the data. Okay, so I guess for me, one of the -- obviously, great efficacy data and consistent with the results that we'd seen in the past. I -- one of the things that has come up with your oral results in the past is the high placebo effect, and it looks like the placebo effectiveness trial is also a little bit higher than we'd seen previously. Just wondering if there's any commentary you'd like to have about what the clinical meaningfulness of these effect sizes that you're seeing relative to those higher than perhaps anticipated placebo rates.

Yes. Thank you, Chris. So the thing to remember here, as Fred pointed out in the presentation, we took quite some time with the FDA to define what a reduction threshold in NRS means with respect to clinical meaningfulness, and that was an analysis we performed empirically on our Phase II data. And from that analysis, it's clear that a 3-point reduction is very much clinically meaningful for a hemodialysis patient suffering from pruritus. So in effect, what we're concerned with here is reaching that threshold statistically in terms of the KORSUVA treatment effect. And really, the data we're showing here is quite consistent with the data we've shown previously with KALM-1. Here, approximately 54% of KORSUVA-treated patients achieved that threshold versus 51% in KALM-1. So I think, in essence, as you've indicated, we've pretty much confirmed the efficacy component here related to the drug effect. In terms of the difference in placebo, it's something we somewhat expected, moving from a solely U.S. site with KALM-1 -- a U.S. trial, sorry, with KALM-1 to the global KALM-2 trial, where we're bringing in sites that are based in Western and Central Europe and also Asia Pacific regions. And it's well known, there is lots of published data with other PRO studies that we tend to see heterogeneity in that placebo response depending on the region we look at. And so I think that was to be expected. But despite that, Chris, I think the important message here is we achieved statistical significance. We reached that threshold and a high percentage of KORSUVA-treated drug patients, and that really, as you said, reinforces the efficacy story here. I think we get a very strong drug effect with KORSUVA in these patients.

Great. Okay. That makes sense, yes, certainly, with the diversity of regions for the placebo. Maybe another way to think about the efficacy, I think you've broken this out in the past with respect to complete responses, maybe getting to a 0 or a 1-point on the worst itch scale. Do you have those data available? Was there any difference between placebo and KORSUVA with respect to that type of analysis?

We -- that's a very good question. We don't yet. That's certainly something we're going to look at as we go through this data set as well as the regional heterogeneity. We just don't have that data in detail yet.

Okay. Okay. Understood. And then maybe just one quick one on safety, if you don't mind. Is there -- I think most of the adverse events seem to be pretty well balanced, a little disparity with respect to GI and perhaps dizziness and falls. Was there any temporal effects or any things that you can think of that might make the predictability of those adverse events within the clinical setting?

Yes. In terms of onset, I'm going to let our CMO, Jo, talk to that. She has a little more detail at hand in terms of the time line on some of these adverse events. Jo, do you want to chip in on that?

Sure. Chris, thanks. So what we've seen typically in KALM-1 and what we've seen again with some of these adverse events, like the diarrhea and the dizziness, they tend to occur earlier on within the first 3 to 6 weeks of onset. So when providing information to prescribers, what they can inform their patients is typically within the first month, they'll probably expect to see some of these more common adverse events.

Our next question comes from Jason Gerberry with Bank of America.

Congrats on the data. Couple of questions for me. I'll just ask them upfront. Derek, at a September broker conference, you had a discussion around pricing for IV KORSUVA. I think you talked about pain drugs as an appropriate analog with perhaps some marginal step-down coming out of the post-TDAPA phase. Just curious, a, do you think that, that's still the right way to be thinking about potential pricing framework for IV KORSUVA as you shift now to commercial considerations? My second question is can you just give us a rundown of your important go-to-market dates with respect to the U.S. market. So you file second half. What are your cut points for 2021 TDAPA as well as securing a permanent J code? Just want to make sure that we're thinking about 2021 appropriately. And then my last question, just on the quality-of-life component. Can you -- I assume you can pool the KALM-1, KALM-2 data in a way to package the quality-of-life data overall with respect to payers and providers?

Thanks, Jason. So yes, we did have a -- in fact, I had a discussion with you directly in -- at your conference in relation to pricing. Still a little too early. I think the discussion we had was you were looking kind of for bookends on what a possible price point could be here for the TDAPA period. And I think we've said before, looking at highly differentiated drugs, treating severe symptoms might be analogous to what we could expect for KORSUVA. And there, we use the example of differentiated pain drugs. So at the bottom end of that market, in terms of pricing, you're looking at high single digits to $10,000 or $12,000. At the top end, it may be a differentiated derm drug such as Otezla, for example, which would be closer to $20,000. So it's a little too early to think about that specifically. I know we've got 9 models out there from our analysts. And I think every single one is different in price point at this point. So we continue our discussions with CMS on that. It's a little early to get to a precise ASP price point. In terms of TDAPA reference, there's really only 1 drug, as you know, that's going to enter TDAPA, and that's Parsabiv from Amgen, which is a calcimimetic drug. There, they're priced at approximately $17,000 per year. So that was an achievable price point for CMS, for them, really a drug for which there are other alternatives, even generic available. So they clearly achieved a pretty reasonable price on that drug. So it's still a little early. We continue our discussions. There are some factors we just don't have yet, such as label, that are going to influence that. But we are in discussions, and we'll certainly inform you as those discussions progress. In terms of timing of getting there, you'll recall that we have breakthrough designation for KORSUVA Injection in this patient population. So we will be applying for a priority review, which would be a 6-month review cycle. So yes, that would be a 2021 approval point. We really, at this point, can't get into particular quarters, Jason. It's still a little too early, but that's something we'll get to a little later in the year as we get the NDA finalized and get it submitted. And did I miss anything, Jason? Did you -- what was your third point?

Just in terms of pooling the KALM-1, 2 data for the quality-of-life measure?

Yes. That's certainly something we can look at in terms of integrating that. Again, the quality of life, as you know, is not something that's going to be on the label. It's not something we are crucially relying on to get this through and get approval here, but we can certainly combine that data and look at it together.

Our next question comes from David Amsellem with Piper Sandler.

So just a couple. First, I apologize if I missed this, but can you talk about the percentage of sites or percentage of patients in KALM-2 that were ex U.S.? Just provide the geographic breakdown if you haven't done so. And then secondly, beyond geographic differences, do you surmise that there is any other factors that are driving the variability of placebo responses? Not just between KALM-1 and KALM-2, but also as you bring in the oral, is there -- are there other things that we should be considering regarding placebo beyond just geography?

Yes. Thanks, David. We have -- I know -- and KALM-2 overall, approximately 40% of the patients are ex U.S. And at this point, I don't think we have a regional breakdown of that. Fred, feel free to jump in if you do know that. I know the majority were European, but I don't think that we have the regional breakdown at this point.

You're right.

Okay. So roughly 40%, David, are ex U.S., majority being European. In terms of the variability in placebo, as you know, we had that discussion with respect to the oral data. One possibility here, and it remains a possibility, at least as a contributing factor on KALM-2, is that there may be some expectation bias on behalf of the patients here related to the previous experience of some of these sites and either our KALM-1 Phase III study or IV Phase II. And there was a small minority number of sites we used in KALM-2 in the U.S. that also had experience previously with KORSUVA Injection and other trials. So it's always a possibility that you can be the victim of your own success here. And as you know, in the last year, we've continued to publish our KALM-1 data, both at conference and also with the New England article. And so it's possible, there is some expectation bias related to the drug, and that's contributing to the increased placebo effect. But again, regardless of that, whatever the placebo effect has been in any of these trials, and now we have trials at 2 weeks, we have trials at 8 weeks, and as of today, we now have 2 trials at 12 weeks, all of which have been statistically significant for the drug. So it's a very robust efficacy response really regardless of the issues related to variable placebo.

Okay. That's helpful. And if I may sneak in a follow-up. Just -- can you just remind us on the Phase III for the oral and CKD, is the -- just remind us, is the primary going to also be the 3-point responder analysis? Or is that going to be a 4-point responder analysis?

Now it's going to be -- we will be proposing this as 3-point analysis. Remember, we've gone through that analysis empirically using anchored statistical results to look at clinical meaningfulness as a CKD population. So that would be a clinically meaningful response.

Our next question comes from Annabel Samimy with Stifel.

Congratulations on the data. I guess just following on David's question around placebo. Can you just remind us what percent of patients were on background meds and how well it was controlled? Or was it controlled any differently than KALM-1? Then secondly, do you expect an AdCom given that kappa opioid agonism, I think, is pretty well understood? And then finally, do you expect any further changes to the atopic dermatitis trial given placebo rates? Or is that already adjusted for when you established an interim analysis for that trial?

Okay. Great. Thanks, Annabel. So yes, con meds in terms of background anti-inflammatories or so-called antipruritics, and then -- and KALM-2, as Fred outlined in the deck, is approximately 36%, 37% balanced across the groups, and KALM-1, very similar, approximately 40%. So very similar in terms of background meds for the 2 trials. What was your second question, Annabel?

Do you expect an AdCom for this given that kappa opioid pretty...

Yes. Yes, this is an NCE, of course, and really with, regardless -- it is a kappa opioid agonist, but it's really a new class, certainly, chemically. And so I think it's probably likely that we would have an AdCom for the molecule. And that would be something we look forward to in terms of talking to the agency under that kind of forum. And then your third question on AD and how we adjusted that. I'm going to let Jo jump in on that because she's actually managing that trial. Jo, do you want to comment on how we adjusted the AD trial post the oral CKD?

Sure. Annabel, thanks for the questions. So for the atopic dermatitis study, we did increase the sample size to 320 patients, and we will be doing an interim assessment to look at conditional powering. But I think of note regarding placebo, which I think you were questioning, very different patient population groups, of course. So we hope to see placebo rates that are more in line with what is expected in an atopic dermatitis patient population. Recall one of the key differences is that those patients have had pruritus since they were children. So when you conduct a study, the pruritus duration has been 20-plus years, and there is some literature to suggest that the longer the duration of pruritus, the less susceptible the patient population are to placebo response. So in addition to that, the atopic dermatitis study as well is very clean to try and remove any potential drugs that could confound the data because we know not only do some of those medications have an impact on itch, they could also have an impact on the disease. So it's quite different to CKD and it's a little bit difficult to compare the 2. It's like comparing apples and oranges. But it's important to keep in mind some of the key differences in the patient population and what drives placebo response and how we need to manage those patients differently.

Okay. And if I could just have one follow-up on the background meds. Was -- were these patients treated any differently in terms of what was -- how the background meds were controlled? Or was it exactly the same in terms of...

No. Exactly the same. So they had to come in -- if they were using a background med, they had to be on it and controlled. They weren't allowed to adjust the medication throughout the study, et cetera. Yes, so it's the same.

Our next question comes from Charles Duncan with Cantor Fitzgerald.

Derek and team, first of all, congratulations on these data. I had 2 clinical questions and then 1 follow-up commercial question. And so the 2 clinical questions are, first of all, when you share these results with your investigators, what did you hear as most important to them in terms of assessing efficacy? And what do you think will be most important to prospective prescribers in the future? Will it be responder rate? Or will it be the placebo-adjusted value? It seems like in migraine, we see responder being important. But what are your thoughts there?

That's a good question, Charles. And if I talk to KOLs and investigators frequently, I'd answer it, but I don't. So I'm going to pass that on to Jo or Fred to comment there. Go ahead.

Yes. Go ahead, Jo.