Core Viewpoint - Cara Therapeutics and Tvardi Therapeutics have announced a definitive merger agreement to create a Nasdaq-listed biopharmaceutical company focused on developing novel treatments targeting STAT3 for fibrosis-driven diseases [1][2] Financial Overview - Tvardi has completed approximately $28 million in private financing, which, along with existing cash and Cara's anticipated cash balance, is expected to fund the combined company into the second half of 2026 [1][3] - Upon completion of the merger, pre-merger Cara stockholders are expected to own approximately 17.0% and pre-merger Tvardi stockholders approximately 83.0% of the combined company, subject to adjustments based on Cara's net cash at closing [2] Clinical Development - Tvardi anticipates reporting topline data in the second half of 2025 from two Phase 2 clinical programs utilizing its STAT3 inhibitor, TTI-101, targeting idiopathic pulmonary fibrosis and hepatocellular carcinoma [1][3] - The ongoing REVERTIPF trial is evaluating TTI-101's safety and efficacy in patients with idiopathic pulmonary fibrosis, with unblinded data expected in the second half of 2025 [9] - The REVERTLIVER CANCER trial is assessing TTI-101 in patients with hepatocellular carcinoma, with preliminary topline data also anticipated in the second half of 2025 [9] Management and Structure - Following the merger, the combined company will be headquartered in Houston, Texas, led by Tvardi's CEO, Imran Alibhai, Ph.D., and will have a board comprised of six directors from Tvardi and one from Cara [11] Strategic Partnerships - Concurrent with the merger agreement, Cara has entered into an asset purchase agreement with CSL Vifor to sell certain assets related to Korsuva/Kapruvia for a purchase price of $900,000, along with a $3 million compensation for future expenses [4][5][6]

Clinical Program Updates - The company announced a decision to discontinue the clinical program in notalgia paresthetica after the KOURAGE-1 study showed no meaningful clinical benefit from oral difelikefalin compared to placebo [170]. - R&D expenses are expected to significantly decrease in the future as the company focuses on strategic alternatives following the discontinuation of its NP program [245]. - The company anticipates focusing expenses on the discontinuation of its clinical program for oral difelikefalin and exploring strategic alternatives to maximize shareholder value [294]. Financial Performance - As of September 30, 2024, the company had shareholders' equity of $0.7 million, failing to meet the Nasdaq requirement of at least $2.5 million [178]. - For the nine months ended September 30, 2024, the company reported a net cash used in operating activities of $56.9 million, compared to $74.7 million for the same period in 2023 [317]. - The company incurred net losses of $63.2 million compared to $86.2 million for the same period in 2023, indicating a reduction in losses [293]. - Total revenue for Q3 2024 was $2.6 million, a decrease of 47% from $4.9 million in Q3 2023, and for the nine months ended September 30, 2024, it was $5.7 million, down 68% from $18.0 million in the same period of 2023 [263]. Shareholder Equity and Compliance - The company received an extension from Nasdaq until January 27, 2025, to regain compliance with the minimum closing bid price requirement of $1.00 per share [177]. - The company is assessing options to regain compliance with Nasdaq's Shareholders' Equity Requirement [178]. - The company has not yet implemented a reverse stock split, which was approved by stockholders, and the decision remains at the discretion of the Board of Directors [179]. Revenue and Sales - KORSUVA injection recorded net sales of approximately $3.0 million in the U.S. for the three months ended September 30, 2024, down from $4.4 million in the same period of 2023, resulting in a profit share of $1.3 million compared to $1.9 million [185]. - For the nine months ended September 30, 2024, KORSUVA injection net sales in the U.S. were approximately $2.1 million, significantly lower than $21.5 million for the same period in 2023, primarily due to higher rebates and chargebacks [185]. - Collaborative revenue from KORSUVA injection for the nine months ended September 30, 2024, was $2.1 million, a decrease from $10.1 million in the same period of 2023 [191]. Strategic Alternatives and Workforce Reduction - The company is exploring strategic alternatives to maximize shareholder value amid substantial uncertainties [164]. - A streamlined operating plan was approved, which includes a workforce reduction of approximately 70%, completed by June 30, 2024 [170]. - In January 2024, the company announced a workforce reduction of up to 50% to reduce operating expenses [251]. Milestone Payments and Agreements - The company is eligible for up to $440.0 million in commercial milestone payments based on sales and tiered double-digit royalty payments from CSL Vifor for KORSUVA injection [212]. - The company received a non-refundable upfront license fee of $15.0 million from Maruishi and is eligible for up to $10.5 million in clinical development and regulatory milestones [216]. - The company plans to achieve a $2.5 million milestone payment upon reaching a 2024 sales milestone for KORSUVA in Japan, expected in Q4 2024 [202]. Cost Management and Expenses - G&A expenses are anticipated to decrease due to workforce reductions, but may still include costs related to remaining personnel and strategic alternatives exploration [249]. - The decrease in R&D expenses was primarily due to the discontinuation of several oral difelikefalin programs and reductions in workforce [270]. - General and administrative expenses for Q3 2024 were $6.5 million, a decrease of 4% from $6.8 million in Q3 2023, and for the nine months ended September 30, 2024, they were $19.7 million, down 7% from $21.2 million in the same period of 2023 [272]. Cash Flow and Investments - The company expects to fund its capital requirements primarily with current unrestricted cash and cash equivalents [289]. - The company has raised an aggregate of $943.8 million to fund operations, including $447.4 million from public offerings and $258.8 million from license and supply agreements [299]. - As of September 30, 2024, the company had invested $5.0 million in marketable securities with a yield of approximately 0.90% [330]. Regulatory and Market Approvals - The IV formulation of oral difelikefalin is approved for treating moderate-to-severe pruritus associated with advanced chronic kidney disease in adults undergoing hemodialysis in the U.S., EU, and multiple other countries [171]. - Difelikefalin, the active ingredient in KORSUVA, is approved for treating moderate-to-severe pruritus associated with advanced CKD in multiple countries, including the U.S., EU, and Japan [186]. - The final CY 2024 rule from CMS established a post-TDAPA add-on payment of 65% for KORSUVA injection, effective April 1, 2024, but the unfavorable reimbursement has led to a lack of sequential revenue growth since the product's launch [185].

Clinical Program Updates - The company announced a decision to discontinue the clinical program in notalgia paresthetica after the KOURAGE-1 study showed no meaningful clinical benefit from oral difelikefalin compared to placebo[131]. - The decision to discontinue the clinical program for oral difelikefalin in neuropathic pruritus was made on June 12, 2024, due to lack of meaningful clinical benefit[156]. - R&D expenses are expected to significantly decrease in the future as the company focuses on strategic alternatives after discontinuing the NP program[194]. Financial Performance - For the three months ended June 30, 2024, CSL Vifor recorded net sales of KORSUVA injection in the United States of approximately negative $2.7 million, compared to $11.4 million for the same period in 2023, representing a significant decline[144][153]. - For the six months ended June 30, 2024, CSL Vifor recorded net sales of KORSUVA injection of approximately negative $0.9 million, down from $17.1 million in the same period of 2023[144][153]. - Total revenue for the three months ended June 30, 2024 was $991,000, an 86% decrease from $6.9 million in 2023; for the six months, total revenue was $3.1 million, down 76% from $13.1 million[211]. - The company reported net losses of $20.0 million and $31.5 million for the three months ended June 30, 2024 and 2023, respectively, and $50.7 million and $58.1 million for the six months ended June 30, 2024[233]. Revenue Sources and Changes - Collaborative revenue from KORSUVA injection was $0.8 million for the six months ended June 30, 2024, a decrease of 90.2% compared to $8.2 million for the same period in 2023[150]. - Royalty revenue from Kapruvia was approximately $123,000 and $248,000 for the three and six months ended June 30, 2023, respectively, with no royalty revenue recorded for the same periods in 2024 due to the HCR Agreement[151][152]. - The anticipated unfavorable CMS reimbursement has resulted in a lack of sequential revenue growth for KORSUVA injection since its launch[187]. Strategic Decisions and Workforce Changes - A streamlined operating plan was approved, which includes a reduction in workforce by approximately 70%, completed by June 30, 2024[131]. - The company announced a workforce reduction of up to 50% in January 2024, followed by an additional reduction of approximately 70% by June 30, 2024[200]. - The company is exploring strategic alternatives to maximize shareholder value, with substantial uncertainties regarding the identification and implementation of these alternatives[127]. Regulatory and Compliance Updates - The company has received an extension from Nasdaq until January 27, 2025, to regain compliance with the minimum closing bid price requirement[137]. - The Centers for Medicare & Medicaid Services (CMS) granted a post-TDAPA add-on payment set at 65% of total trailing 12-month expenditure levels for KORSUVA injection, effective April 1, 2024[143]. Agreements and Milestones - The HCR Agreement includes an initial payment of $17.5 million and an additional $20.0 million upon achieving a milestone event for pricing in Germany[158]. - The company has out-licensed KORSUVA injection commercialization in Japan to Maruishi, which received manufacturing and marketing approval in September 2023[147]. - The company is eligible for up to $440.0 million in commercial milestone payments from CSL Vifor, all of which are sales-related[165]. Cash Flow and Investments - Net cash used in operating activities for the six months ended June 30, 2024, was $50.7 million, with a net loss contributing significantly to this figure[253]. - Net cash provided by investing activities was $41.2 million for the six months ended June 30, 2024, primarily from maturities of marketable securities[256]. - The company expects its current cash and cash equivalents will be sufficient to fund operations for at least the next 12 months, despite uncertainties[252]. Cost Management and Expenses - General and administrative expenses for the three months ended June 30, 2024 were $6.4 million, a 15% decrease from $7.5 million in 2023; for the six months, G&A expenses were $13.2 million, down 8% from $14.4 million[218]. - Restructuring expenses for the three months ended June 30, 2024 were $2.6 million, related to the discontinuation of the oral program and associated workforce reduction[221]. - Stock-based compensation expense decreased significantly, with an 83% reduction for the three months ended June 30, 2024 compared to 2023[214].

Core Viewpoint - Cara Therapeutics is committed to exploring strategic options to maximize shareholder value, with a focus on cost-containment and cash conservation as part of a streamlined operating plan [1]. Group 1: Strategic Review and Financial Advisory - The company has engaged Piper Sandler & Co. as its financial advisor to assist in exploring and reviewing strategic alternatives [2]. - There is no assurance that the exploration of strategic alternatives will lead to any agreements or transactions, and the company will not disclose further developments unless approved by its Board of Directors [3]. Group 2: Financial Position - As of March 31, 2024, Cara Therapeutics had approximately $70 million in cash, cash equivalents, and marketable securities [4]. Group 3: Company Overview - Cara Therapeutics is a biopharmaceutical company focused on transforming the treatment of pruritus, having developed an IV formulation of difelikefalin approved for treating moderate-to-severe pruritus associated with advanced chronic kidney disease in adults undergoing hemodialysis [5].

Core Viewpoint - Cara Therapeutics Inc's stock experienced a significant decline following disappointing clinical trial results for its oral difelikefalin product, leading to downgrades from analysts [1][2][4]. Group 1: Analyst Downgrades - Needham analyst Joseph Stringer downgraded the stock rating from Buy to Hold due to the failure of the KOURAGE trial [2][8]. - HC Wainwright analyst Oren Livnat also downgraded the stock from Buy to Neutral, citing a lack of future value drivers or catalysts following the clinical disappointment [2][4]. Group 2: Clinical Trial Results - The Phase 2/3 KOURAGE trial evaluating oral Korsuva (difelikefalin) in Notalgia Parasthetica (NP) failed to demonstrate efficacy compared to placebo, with no dose level showing meaningful clinical benefit [8][4]. - The company plans to halt all development related to the NP program and explore strategic alternatives, indicating a lack of meaningful clinical development programs in the pipeline [9][4]. Group 3: Financial Outlook - The company is projected to have $60 million in cash by the end of Q2 2024, with no debt, and a market cap of less than $40 million, which may provide strategic options such as a reverse merger or liquidation [10]. - At the time of publication, shares of Cara Therapeutics had declined by 34.51% to 44 cents [10].

This data comes from the company's Part A KOURAGE-1 study. It's designed to determine the dose that will be used for the drug during later parts of the clinical trial. The bad news here is that none of the doses that were tested showed meaningful clinical benefit over placebo. What This Means for CARA Stock CARA stock is down 26.7% as of Thursday morning. That builds on a year-to-date drop of 10.6% when markets closed yesterday. More Stock Market News for Thursday On the date of publication, William White d ...

KOURAGE-1 Part A was a multicenter, randomized, double-blind, placebo-controlled study designed to inform the dose and sample size for the pivotal portions of the Phase 2/3 clinical program. In Part A, 214 patients were randomized to one of four arms: oral difelikefalin 2 mg twice a day (BID), 1 mg BID, 0.25 mg BID or placebo BID for 8 weeks. The primary endpoint was the proportion of patients achieving a ≥4-point improvement from baseline in the weekly mean of the daily 24-hour Itch-Numeric Rating Scale (I ...

– Oral difelikefalin did not demonstrate meaningful clinical benefit compared to placebo – STAMFORD, Conn., June 12, 2024 (GLOBE NEWSWIRE) -- Cara Therapeutics, Inc. (Nasdaq: CARA), a development-stage biopharmaceutical company leading a new treatment paradigm to improve the lives of patients suffering from pruritus, today announced the outcome from the dose-finding Part A of the KOURAGE1 study evaluating the efficacy and safety of oral difelikefalin for moderate-to-severe pruritus in adult patients with no ...

Cara Therapeutics (CARA) came out with a quarterly loss of $0.56 per share versus the Zacks Consensus Estimate of a loss of $0.38. This compares to loss of $0.49 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -47.37%. A quarter ago, it was expected that this biotechnology company would post a loss of $0.57 per share when it actually produced a loss of $0.59, delivering a surprise of -3.51%. Over the last four quarters, the c ...

● the length of time required to enroll eligible patients; ● the number of doses that patients receive; ● the drop-out or discontinuation rates of patients; ● potential additional safety monitoring or other studies requested by regulatory agencies; ● the duration of patient follow-up; and ● the efficacy and safety profile of the product candidate. injection commenced on April 1, 2024. The unfavorable CMS reimbursement codified in the final CY2024 4l Table of Contents In addition, the probability of success ...