Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 COMMISSION FILE NUMBER: 001-36279 CARA THERAPEUTICS, INC. (Exact name of registrant as specified in its charter) Delaware 75-3175693 (State or other jurisdiction of incorporation or organ ...

Targeting Pruritus with First-In-Class Therapeutics January, 2021 Forward Looking Statements 2 This presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by the words "anticipate," "believe," "continue," "estimate," "expect," "objective," "ongoing," "plan," "propose," "potential," "projected", or "up-coming" and/or the negative of these terms, or other comparable terminol ...

Cara Therapeutics, Inc. (NASDAQ:CARA) Q3 2020 Earnings Conference Call November 9, 2020 4:30 PM ET Company Participants Jack Hildick-Smith - Stern IR Derek Chalmers - President and CEO Thomas Reilly - CFO Conference Call Participants Zach Sachar - Piper Sandler Nick Rubino - Stifel Chi Meng Fong - BAnk of America Alan Carr - Needham & Company Ben Shim - Canaccord Operator Good afternoon and welcome to Cara Therapeutics' Third Quarter 2020 Financial Results Conference Call. All participants are now in list ...

PART I – FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section presents Cara Therapeutics, Inc.'s unaudited condensed financial statements, detailing financial position, performance, and accounting policies [Condensed Financial Statements](index=4&type=section&id=Condensed%20Financial%20Statements) Condensed financial statements show total assets decreased to **$147.1 million** by September 2020, a **$70.5 million** net loss for nine months, and increased cash used in operations Condensed Balance Sheet Data (in thousands) | Account | Sep 30, 2020 | Dec 31, 2019 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $75,281 | $18,305 | | Marketable securities | $56,094 | $199,860 | | Total current assets | $132,837 | $165,656 | | Total assets | $147,136 | $232,959 | | **Liabilities & Equity** | | | | Total current liabilities | $16,598 | $42,894 | | Total liabilities | $19,289 | $46,246 | | Total stockholders' equity | $127,847 | $186,713 | | Accumulated deficit | ($471,226) | ($400,727) | Condensed Statements of Comprehensive Loss (in thousands, except per share data) | Metric | Three Months Ended Sep 30, 2020 | Three Months Ended Sep 30, 2019 | Nine Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2019 | | :--- | :--- | :--- | :--- | :--- | | Total revenue | $9,266 | $5,785 | $22,993 | $15,375 | | Research and development | $21,067 | $35,992 | $80,711 | $83,956 | | General and administrative | $5,219 | $4,226 | $15,187 | $13,128 | | Operating loss | ($17,020) | ($34,433) | ($72,905) | ($81,709) | | Net loss | ($16,509) | ($32,842) | ($70,499) | ($77,762) | | Net loss per share (Basic & Diluted) | ($0.35) | ($0.74) | ($1.51) | ($1.88) | Condensed Statements of Cash Flows (in thousands) | Activity | Nine Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2019 | | :--- | :--- | :--- | | Net cash used in operating activities | ($87,575) | ($78,059) | | Net cash provided by (used in) investing activities | $143,880 | ($45,254) | | Net cash provided by financing activities | $671 | $142,576 | | Net increase in cash, cash equivalents and restricted cash | $56,976 | $19,263 | [Notes to Condensed Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Financial%20Statements) This subsection details the company's business, accounting policies, and financial statement items, including its clinical-stage status, collaboration agreements, and a **$150 million** Vifor license agreement - Cara Therapeutics is a clinical-stage biopharmaceutical company focused on developing new chemical entities to alleviate pruritus, having incurred **substantial net losses and negative cash flows** from operations since inception[23](index=23&type=chunk)[25](index=25&type=chunk) - The company has significant collaboration and licensing agreements with Vifor Fresenius Medical Care Renal Pharma Ltd (VFMCRP), Maruishi Pharmaceutical Co, Ltd, and Chong Kun Dang Pharmaceutical Corp (CKDP) for its lead product candidate, CR845/difelikefalin[97](index=97&type=chunk)[107](index=107&type=chunk)[112](index=112&type=chunk) - Revenue recognition is primarily tied to these licensing agreements, with **$21.8 million** recognized from the VFMCRP agreement and a **$0.6 million** milestone payment from the CKDP agreement for the nine months ended September 30, 2020[115](index=115&type=chunk)[123](index=123&type=chunk)[153](index=153&type=chunk) - Subsequent to the quarter's end in October 2020, the company entered a significant license agreement with Vifor (International) Ltd, receiving a **$100 million** upfront payment and an additional **$50 million** from common stock sale[26](index=26&type=chunk)[211](index=211&type=chunk)[214](index=214&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=60&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes the company's financial condition and operations, covering COVID-19 impact, the KORSUVA pipeline, operating results, liquidity, and capital resources, with **$150 million** from Vifor expected to fund operations into 2023 [Introduction & Recent Developments](index=63&type=section&id=Introduction%20%26%20Recent%20Developments) This section introduces the company's focus on pruritus treatments with KORSUVA, recent COVID-19 impacts, a **$150 million** Vifor license agreement, and the appointment of a new CFO - The COVID-19 pandemic has affected patient enrollment for Phase 2 clinical trials of Oral KORSUVA but is not expected to delay the New Drug Application (NDA) submission for KORSUVA injection, which remains on track for **Q4 2020**[236](index=236&type=chunk) - In October 2020, the company entered a license agreement with Vifor, receiving a **$100.0 million** upfront payment and an additional **$50.0 million** for common stock purchase, significantly strengthening its financial position[239](index=239&type=chunk) - Effective October 1, 2020, Thomas Reilly was appointed as the company's Chief Financial Officer[240](index=240&type=chunk) [Our Product Candidate Pipeline](index=65&type=section&id=Our%20Product%20Candidate%20Pipeline) The company's pipeline focuses on KORSUVA (CR845/difelikefalin) in injectable and oral forms, with NDA submission for injection in **Q4 2020** and oral form Phase 2 data expected in **2021** - The company's lead product, KORSUVA (CR845/difelikefalin) Injection for CKD-aP in hemodialysis patients, has completed two pivotal Phase 3 trials (KALM-1 and KALM-2), both meeting primary and key secondary endpoints[246](index=246&type=chunk)[250](index=250&type=chunk) - An NDA submission to the FDA for KORSUVA Injection is expected in the **fourth quarter of 2020**, with a Marketing Authorisation Application (MAA) to the EMA to follow shortly thereafter[245](index=245&type=chunk) - The Oral KORSUVA program is advancing with ongoing Phase 2 trials for pruritus in patients with Atopic Dermatitis (AD) and Chronic Liver Disease (CLD), with top-line data for both expected in the **first half of 2021**[259](index=259&type=chunk)[265](index=265&type=chunk) [Collaboration and License Agreements](index=75&type=section&id=Collaboration%20and%20License%20Agreements) This subsection details key strategic partnerships, including a recent Vifor agreement for KORSUVA injection U.S. commercialization with **$150 million** upfront, and existing agreements for global rights and milestones - In October 2020, the company granted Vifor an exclusive license for U.S. commercialization of KORSUVA injection in dialysis patients, including a **$100M** upfront payment, a **$50M** equity investment, up to **$240M** in sales-based milestones, and a **60/40 profit-sharing** arrangement in Cara's favor[275](index=275&type=chunk)[276](index=276&type=chunk)[277](index=277&type=chunk) - The May 2018 agreement with VFMCRP covers commercialization rights for KORSUVA injection in most territories outside the U.S., Japan, and South Korea, with Cara eligible for up to **$470 million** in regulatory and commercial milestones plus tiered double-digit royalties[283](index=283&type=chunk)[284](index=284&type=chunk) - The company has existing agreements with Maruishi for Japan and CKDP for South Korea, which include potential milestone payments and royalties, with a **$0.6 million** milestone achieved and received from CKDP in May 2020[285](index=285&type=chunk)[289](index=289&type=chunk)[290](index=290&type=chunk) [Results of Operations](index=85&type=section&id=Results%20of%20Operations) This subsection compares financial results for Q3 and nine months ended September 30, 2020, showing increased total revenue, a **41%** decrease in Q3 R&D expenses, and higher G&A expenses Revenue Comparison (in thousands) | Revenue Type | Q3 2020 | Q3 2019 | % Change | Nine Months 2020 | Nine Months 2019 | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | License and milestone fees | $9,257 | $5,785 | 60% | $22,377 | $15,235 | 47% | | Clinical compound revenue | $9 | $0 | N/A | $616 | $140 | 341% | | **Total Revenue** | **$9,266** | **$5,785** | **60%** | **$22,993** | **$15,375** | **50%** | R&D Expense Comparison (in thousands) | Period | R&D Expense 2020 | R&D Expense 2019 | % Change | | :--- | :--- | :--- | :--- | | Three Months Ended Sep 30 | $21,067 | $35,992 | -41% | | Nine Months Ended Sep 30 | $80,711 | $83,956 | -4% | - The decrease in R&D expenses for **Q3 2020** was primarily due to lower costs associated with the completed KALM-1 and KALM-2 Phase 3 trials for KORSUVA injection, partially offset by increased costs for the Phase 2 trial in Atopic Dermatitis and NDA submission preparation[320](index=320&type=chunk) G&A Expense Comparison (in thousands) | Period | G&A Expense 2020 | G&A Expense 2019 | % Change | | :--- | :--- | :--- | :--- | | Three Months Ended Sep 30 | $5,219 | $4,226 | 24% | | Nine Months Ended Sep 30 | $15,187 | $13,128 | 16% | [Liquidity and Capital Resources](index=89&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is supported by **$131.4 million** in cash and securities as of September 2020, with an additional **$150 million** from Vifor expected to fund operations into **2023**, though significant losses are anticipated - As of September 30, 2020, the company had **$131.4 million** in unrestricted cash, cash equivalents, and available-for-sale marketable securities[334](index=334&type=chunk) - Including the **$150.0 million** in proceeds from the Vifor license agreement received in October 2020, the company believes its existing capital is sufficient to fund operating expenses and capital expenditures into **2023**[334](index=334&type=chunk) Cash Flow Summary (Nine Months Ended Sep 30, in thousands) | Cash Flow Activity | 2020 | 2019 | | :--- | :--- | :--- | | Net cash used in operating activities | ($87,575) | ($78,059) | | Net cash provided by (used in) investing activities | $143,880 | ($45,254) | | Net cash provided by financing activities | $671 | $142,576 | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=98&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section addresses market risks, primarily interest rate and credit quality risks on the company's investment portfolio, noting a conservative policy and immaterial impact from a hypothetical **1%** interest rate increase - The company's primary market risk exposure is to interest rate fluctuations on its portfolio of cash equivalents and marketable securities, which consist of investment-grade debt instruments[366](index=366&type=chunk) - Due to the conservative nature and short duration of its investments, the company believes its interest rate risk is mitigated, with a hypothetical **1%** increase in interest rates having an immaterial impact on the portfolio's fair value[368](index=368&type=chunk)[369](index=369&type=chunk) [Item 4. Controls and Procedures](index=98&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded the company's disclosure controls and procedures were effective as of September 30, 2020, with only a non-material change related to ASU 2016-13 adoption - Management, including the Chief Executive Officer and Chief Financial Officer, concluded that the company's disclosure controls and procedures were effective as of September 30, 2020[371](index=371&type=chunk)[373](index=373&type=chunk) - A change was made to internal controls over financial reporting during the quarter to address the adoption of ASU 2016-13 (Financial Instruments—Credit Losses), but it did not have a material impact, and no other material changes were reported[374](index=374&type=chunk)[375](index=375&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=101&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any legal proceedings that would materially adversely affect its business, operating results, or financial condition - As of the filing date, the company is not a party to any material legal proceedings[379](index=379&type=chunk) [Item 1A. Risk Factors](index=101&type=section&id=Item%201A.%20Risk%20Factors) This section details numerous business risks, including a history of losses, dependence on KORSUVA, regulatory uncertainties, competition, reliance on third parties, and the adverse impact of the COVID-19 pandemic - The company has a history of significant losses, with an accumulated deficit of **$471.2 million** as of September 30, 2020, and anticipates continued losses for the foreseeable future[381](index=381&type=chunk)[390](index=390&type=chunk) - The business is substantially dependent on the success of its lead product candidate, KORSUVA (CR845/difelikefalin) injection, with no guarantee of regulatory approval or successful commercialization[382](index=382&type=chunk)[401](index=401&type=chunk) - The COVID-19 pandemic poses a risk to business operations, clinical development, and regulatory timelines, potentially causing delays in trial site initiation and patient enrollment[388](index=388&type=chunk)[414](index=414&type=chunk) - The company relies on third parties for conducting clinical trials and manufacturing its product candidates, and any failure by these parties to perform satisfactorily could delay development and commercialization[387](index=387&type=chunk)[503](index=503&type=chunk)[510](index=510&type=chunk) [Other Items (Items 2, 3, 4, 5, 6)](index=186&type=section&id=Other%20Items%20%28Items%202%2C%203%2C%204%2C%205%2C%206%29) This section covers remaining standard disclosure items, reporting 'None' or 'Not applicable' for Items 2-5, and listing exhibits filed with the report, including corporate governance documents and officer certifications - There were no unregistered sales of equity securities, defaults upon senior securities, or other material information to report for the period[655](index=655&type=chunk) - The report includes a list of exhibits filed, such as the Amended and Restated Certificate of Incorporation, Bylaws, a new employment agreement, and required CEO/CFO certifications[658](index=658&type=chunk)

Cara Therapeutics, Inc. (NASDAQ:CARA) Q2 2020 Earnings Conference Call August 10, 2020 4:30 PM ET Company Participants Jack Hildick-Smith - Stern IR Derek Chalmers - President and CEO Rick Makara - VP and Head, Accounting Conference Call Participants Chris Howerton - Jefferies David Amsellem - Piper Sandler Annabel Samimy - Stifel Jason Gerberry - Bank of America Alan Carr - Needham & Company Operator Good afternoon and welcome to Cara Therapeutics' Second Quarter 2020 Financial Results Conference Call. All ...

PART I – FINANCIAL INFORMATION [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Unaudited condensed financial statements for Q2 2020 show decreased assets, increased net loss, and higher cash used in operations [Condensed Balance Sheets](index=4&type=section&id=Condensed%20Balance%20Sheets) Total assets decreased to **$168.6 million** by June 30, 2020, driven by reduced marketable securities and increased accumulated deficit Condensed Balance Sheet Summary (in thousands) | Account | June 30, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $56,967 | $18,305 | | Marketable securities | $96,079 | $199,860 | | Total current assets | $141,915 | $165,656 | | **Total assets** | **$168,613** | **$232,959** | | **Liabilities & Equity** | | | | Total current liabilities | $24,726 | $42,894 | | Total liabilities | $27,685 | $46,246 | | Accumulated deficit | ($454,717) | ($400,727) | | Total stockholders' equity | $140,928 | $186,713 | | **Total liabilities and stockholders' equity** | **$168,613** | **$232,959** | [Condensed Statements of Comprehensive Loss](index=5&type=section&id=Condensed%20Statements%20of%20Comprehensive%20Loss) Q2 2020 revenue slightly increased to **$5.6 million**, but net loss widened to **$25.1 million** due to higher R&D expenses Statement of Comprehensive Loss Summary (in thousands, except per share data) | Metric | Three Months Ended June 30, 2020 | Three Months Ended June 30, 2019 | Six Months Ended June 30, 2020 | Six Months Ended June 30, 2019 | | :--- | :--- | :--- | :--- | :--- | | Total revenue | $5,634 | $5,208 | $13,727 | $9,590 | | Research and development | $26,108 | $24,356 | $59,644 | $47,964 | | General and administrative | $5,410 | $4,994 | $9,968 | $8,902 | | Operating loss | ($25,884) | ($24,142) | ($55,885) | ($47,276) | | **Net loss** | **($25,068)** | **($22,960)** | **($53,990)** | **($44,920)** | | **Net loss per share (Basic and Diluted)** | **($0.54)** | **($0.58)** | **($1.15)** | **($1.13)** | [Condensed Statements of Cash Flows](index=7&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) Net cash used in operating activities increased to **$66.0 million** for H1 2020, offset by **$104.3 million** from investing activities Cash Flow Summary for the Six Months Ended June 30 (in thousands) | Activity | 2020 | 2019 | | :--- | :--- | :--- | | Net cash used in operating activities | ($65,955) | ($52,422) | | Net cash provided by investing activities | $104,341 | $51,627 | | Net cash provided by financing activities | $276 | $4,208 | | **Net increase in cash, cash equivalents and restricted cash** | **$38,662** | **$3,413** | [Notes to Condensed Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Financial%20Statements) Notes detail the company's biopharmaceutical business, significant accumulated deficit, reliance on financing, and key collaboration agreements - The company is a clinical-stage biopharmaceutical firm focused on developing and commercializing treatments for pruritus by targeting peripheral kappa opioid receptors[20](index=20&type=chunk) - As of June 30, 2020, the company had an accumulated deficit of **$454.7 million** and expects to incur substantial net losses for the foreseeable future[22](index=22&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=53&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) MD&A discusses KORSUVA's clinical progress, COVID-19 impact, increased R&D expenses, and liquidity sufficient into H2 2021 [Product Candidate Pipeline](index=58&type=section&id=Product%20Candidate%20Pipeline) The pipeline focuses on KORSUVA, with NDA submission for injection expected in Q4 2020 and oral formulation in Phase 2 trials - The company expects to submit a New Drug Application (NDA) to the FDA for KORSUVA (CR845/difelikefalin) injection for CKD-aP in the **fourth quarter of 2020**[223](index=223&type=chunk) - Positive top-line results from the pivotal KALM-2 Phase 3 trial were announced in April 2020, with the trial meeting its primary and key secondary endpoints[224](index=224&type=chunk) - The Phase 2 trial for Oral KORSUVA in Atopic Dermatitis was expanded to **410 patients** to maintain statistical power based on an IDMC recommendation following an interim analysis[239](index=239&type=chunk) [Collaboration and License Agreements](index=67&type=section&id=Collaboration%20and%20License%20Agreements) Key KORSUVA commercialization partnerships include VFMCRP (up to **$470 million** in milestones), Maruishi, and CKDP (received **$0.6 million** milestone) - The VFMCRP agreement provides for up to **$470 million** in regulatory and commercial milestone payments, plus tiered double-digit royalties[253](index=253&type=chunk) - In June 2020, the company received a **$0.6 million** milestone payment (net of tax) from CKDP for the completion of a Phase 3 trial for uremic pruritus in the U.S.[259](index=259&type=chunk) - The company entered into a Master Manufacturing Services Agreement (MSA) with Patheon in July 2019 to secure commercial supplies of CR845/difelikefalin injection[265](index=265&type=chunk)[269](index=269&type=chunk) [Results of Operations](index=74&type=section&id=Results%20of%20Operations) Q2 2020 revenue increased to **$5.6 million**, but R&D expenses rose to **$26.1 million**, contributing to a wider net loss Comparison of Results of Operations (in thousands) | Metric | Three Months Ended June 30, 2020 | Three Months Ended June 30, 2019 | Six Months Ended June 30, 2020 | Six Months Ended June 30, 2019 | | :--- | :--- | :--- | :--- | :--- | | Total revenue | $5,634 | $5,208 | $13,727 | $9,590 | | R&D expense | $26,108 | $24,356 | $59,644 | $47,964 | | G&A expense | $5,410 | $4,994 | $9,968 | $8,902 | - The increase in R&D expenses for the six months ended June 30, 2020 was primarily driven by activities related to the KALM-2 Phase 3 trial, the Phase 3 safety trial of KORSUVA injection, and the Phase 2 trial for pruritus associated with Atopic Dermatitis (AD)[291](index=291&type=chunk) [Liquidity and Capital Resources](index=78&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2020, the company held **$153.0 million** in liquidity, sufficient to fund operations into H2 2021 - As of June 30, 2020, the company had **$153.0 million** in unrestricted cash, cash equivalents, and available-for-sale marketable securities[306](index=306&type=chunk) - The company believes its existing cash will be sufficient to fund currently anticipated operating expenses and capital expenditures into the **second half of 2021**[306](index=306&type=chunk)[321](index=321&type=chunk) - Net cash used in operating activities for the six months ended June 30, 2020 was **$66.0 million**, an increase from **$52.4 million** in the prior year period, primarily due to higher net loss and changes in operating assets and liabilities[323](index=323&type=chunk)[324](index=324&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=87&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Market risk primarily stems from interest rate fluctuations on investment portfolio, mitigated by short-duration, high-quality debt instruments - The company's primary market risk exposure is interest rate risk on its investment portfolio of cash, cash equivalents, and marketable securities[336](index=336&type=chunk)[338](index=338&type=chunk) - As of June 30, 2020, the company had invested **$96.1 million** in marketable securities with a yield of approximately **1.70%** and maturities through December 2021[337](index=337&type=chunk) [Controls and Procedures](index=89&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2020, with minor revisions for ASU 2016-13 - Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2020[342](index=342&type=chunk) PART II – OTHER INFORMATION [Legal Proceedings](index=90&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently involved in any legal proceedings that would materially impact its business or financial condition - The company is not currently a party to any material legal proceedings[348](index=348&type=chunk) [Risk Factors](index=90&type=section&id=Item%201A.%20Risk%20Factors) Significant risks include a history of losses, dependence on KORSUVA's success, clinical development challenges, and COVID-19 disruptions - The company has a history of significant losses, with an accumulated deficit of **$454.7 million** as of June 30, 2020, and anticipates continued losses for the foreseeable future[350](index=350&type=chunk)[351](index=351&type=chunk) - The business is substantially dependent on the success of its lead product candidate, KORSUVA (CR845/difelikefalin) injection, which may never receive regulatory approval or be successfully commercialized[365](index=365&type=chunk)[366](index=366&type=chunk) - The ongoing COVID-19 pandemic could adversely affect business operations, clinical development timelines, and patient enrollment in trials[374](index=374&type=chunk)[376](index=376&type=chunk) [Other Items (2, 3, 4, 5, 6)](index=172&type=section&id=Other%20Items) This section confirms no unregistered equity sales, no defaults on senior securities, and no other material disclosures for the period - There were no unregistered sales of equity securities, defaults upon senior securities, or other material information to report during the period[615](index=615&type=chunk)[617](index=617&type=chunk)[621](index=621&type=chunk)

Targeting Pruritus with Novel Peripherally-Restricted Kappa Agonist Therapeutics May 2020 Forward Looking Statements 2 This presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by the words "anticipate," "believe," "continue," "estimate," "expect," "objective," "ongoing," "plan," "propose," "potential," "projected", or "up-coming" and/or the negative of these terms, or o ...

Cara Therapeutics, Inc. (NASDAQ:CARA) Q1 2020 Earnings Conference Call May 11, 2020 4:30 PM ET Company Participants Jack Hildick-Smith - Stern Investor Relations Derek Chalmers - President & Chief Executive Officer Rick Makara - Vice President & Head of Accounting Conference Call Participants Jason Gerberry - Bank of America David Amsellem - Piper Sandler Chris Howerton - Jefferies Alan Carr - Needham & Company Esther Hong - Janney Operator Good afternoon and welcome to Cara Therapeutics First Quarter 2020 ...

```markdown [PART I – FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%93FINANCIAL%20INFORMATION) [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed financial statements for the quarter ended March 31, 2020, including balance sheets, comprehensive loss, stockholders' equity, and cash flows, with accompanying notes [Condensed Balance Sheets](index=4&type=section&id=Condensed%20Balance%20Sheets) The balance sheet shows a decrease in total assets from **$233.0 million** at the end of 2019 to **$196.2 million** as of March 31, 2020, primarily driven by a reduction in cash, cash equivalents, and marketable securities, with total stockholders' equity also decreasing from **$186.7 million** to **$160.5 million** over the same period, reflecting the net loss incurred during the quarter Condensed Balance Sheet Data (in thousands) | Account | March 31, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Total current assets** | $132,669 | $165,656 | | **Total assets** | $196,173 | $232,959 | | **Total current liabilities** | $18,362 | $22,917 | | **Total liabilities** | $35,699 | $46,246 | | **Total stockholders' equity** | $160,474 | $186,713 | | **Accumulated deficit** | ($429,649) | ($400,727) | [Condensed Statements of Comprehensive Loss](index=5&type=section&id=Condensed%20Statements%20of%20Comprehensive%20Loss) For the first quarter of 2020, the company reported a significant increase in revenue to **$8.1 million**, up from **$4.4 million** in the prior-year period, driven by license and milestone fees, with operating expenses also rising substantially, and R&D expenses increasing to **$33.5 million**, resulting in a higher net loss of **$28.9 million**, or **($0.62) per share**, compared to a net loss of **$22.0 million**, or **($0.56) per share**, in Q1 2019 Statement of Comprehensive Loss (in thousands, except per share data) | Metric | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | **Total revenue** | $8,093 | $4,382 | | License and milestone fees | $8,021 | $4,242 | | **Research and development** | $33,536 | $23,608 | | **General and administrative** | $4,558 | $3,908 | | **Operating loss** | ($30,001) | ($23,134) | | **Net loss** | ($28,922) | ($21,960) | | **Net loss per share (Basic and Diluted)** | ($0.62) | ($0.56) | [Condensed Statements of Cash Flows](index=7&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) The company used **$38.3 million** in cash for operating activities during the first quarter of 2020, a significant increase from the **$27.5 million** used in the same period of 2019, primarily due to a higher net loss and changes in operating assets and liabilities, while investing activities provided **$37.0 million** in cash, mainly from maturities of marketable securities, and financing activities provided a minor cash inflow from stock option exercises Cash Flow Summary (in thousands) | Activity | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | **Net cash used in operating activities** | ($38,303) | ($27,526) | | **Net cash provided by investing activities** | $36,959 | $26,399 | | **Net cash provided by financing activities** | $75 | $234 | | **Net decrease in cash, cash equivalents and restricted cash** | ($1,269) | ($893) | [Notes to Condensed Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Financial%20Statements) The notes provide crucial context to the financial statements, detailing the company's business focus on developing pruritus treatments, its history of net losses and negative cash flows, and its reliance on equity financing and license agreements for funding, along with significant accounting policies, collaboration agreements, revenue recognition, stock-based compensation, and commitments - The company is a clinical-stage biopharmaceutical firm focused on developing and commercializing new chemical entities to alleviate pruritus by selectively targeting peripheral kappa opioid receptors[21](index=21&type=chunk) - As of March 31, 2020, the company had an accumulated deficit of **$429.6 million** and has incurred substantial net losses and negative cash flows from operations since inception, a trend expected to continue[23](index=23&type=chunk) - Revenue from the VFMCRP Agreement is recognized proportionately as R&D services are conducted, with **$8.021 million** recognized as license and milestone fees revenue for Q1 2020[110](index=110&type=chunk) - The company entered into a license agreement with Enteris Biopharma in August 2019 for its Peptelligence® technology to develop an oral formulation of its product candidate, paying an upfront fee of **$8.0 million**[168](index=168&type=chunk)[169](index=169&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=52&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management analyzes the company's financial condition, operational results, and future outlook, covering KORSUVA development, Q1 2020 performance, and liquidity, with funds expected to last into the second half of 2021 [Product Candidate Pipeline](index=57&type=section&id=Our%20Product%20Candidate%20Pipeline) The company's pipeline centers on KORSUVA (CR845/difelikefalin), a first-in-class KOR agonist, with the injectable form in late-stage development for CKD-aP in hemodialysis patients, an NDA submission expected in the second half of 2020, and the oral form being evaluated in Phase 2 trials for CKD-aP (non-dialysis), CLD-aP, and Atopic Dermatitis (AD) - The company expects to submit a New Drug Application (NDA) to the FDA for KORSUVA injection for CKD-aP in the second half of 2020, following positive top-line results from its pivotal KALM-2 Phase 3 trial[212](index=212&type=chunk)[213](index=213&type=chunk) - The Phase 2 trial of Oral KORSUVA for pruritus in stage III-V CKD patients met its primary endpoint for the **1.0 mg** dose, and the company plans an End-of-Phase 2 meeting with the FDA in the second half of 2020[223](index=223&type=chunk)[226](index=226&type=chunk) - A Phase 2 trial of Oral KORSUVA for pruritus in patients with Atopic Dermatitis (AD) was expanded to approximately **320 patients**, with an interim analysis expected in Q2 2020 and top-line results in 2020, subject to COVID-19 related delays[233](index=233&type=chunk) [Results of Operations](index=74&type=section&id=Results%20of%20Operations) Comparing Q1 2020 to Q1 2019, total revenue increased **85%** to **$8.1 million**, driven by license fee revenue from the VFMCRP Agreement, while R&D expenses rose **42%** to **$33.5 million** due to increased activity in the KORSUVA clinical programs, and G&A expenses increased to **$4.6 million** from **$3.9 million**, reflecting higher professional fees and stock-based compensation Comparison of Operating Results (in thousands) | Item | Q1 2020 | Q1 2019 | % Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | $8,093 | $4,382 | 85% | | **R&D Expense** | $33,536 | $23,608 | 42% | | **G&A Expense** | $4,558 | $3,908 | 17% | - The increase in R&D expenses was primarily driven by costs for the KALM-2 Phase 3 trial, the Phase 3 safety trial of KORSUVA injection, and the Phase 2 trial for pruritus associated with Atopic Dermatitis (AD)[276](index=276&type=chunk) [Liquidity and Capital Resources](index=76&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2020, the company had **$179.8 million** in unrestricted cash, cash equivalents, and marketable securities, which management believes are sufficient to support operations into the second half of 2021, though the company has a history of losses and expects to continue incurring significant expenses, necessitating additional capital to fund its development and potential commercialization activities - The company believes its existing cash and marketable securities of **$179.8 million** as of March 31, 2020, will be sufficient to fund operations into the second half of 2021[286](index=286&type=chunk)[304](index=304&type=chunk) - The company has an effective Shelf Registration Statement allowing it to offer up to **$300.0 million** in securities, of which approximately **$145.5 million** has been sold to date, providing flexibility for future capital raises[285](index=285&type=chunk) - Future expenses are expected to increase with the continued development of KORSUVA, seeking regulatory approvals, and establishing a commercial infrastructure[295](index=295&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=84&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's market risk exposure is primarily related to interest rate fluctuations affecting its portfolio of cash equivalents and available-for-sale marketable securities, which consists of high-grade debt instruments with relatively short durations, mitigating interest rate risk, and the company does not use derivative instruments to manage this exposure - The company's primary market risk is interest rate risk, where a hypothetical **1%** increase in interest rates would result in an immaterial decrease in the fair value of its portfolio due to the conservative nature and short duration of its investments[320](index=320&type=chunk)[321](index=321&type=chunk) - Credit quality risk is managed through an investment policy that specifies minimum credit quality, and limits exposure to any single issuer or investment type[322](index=322&type=chunk) [Controls and Procedures](index=86&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and Principal Financial Officer, evaluated the company's disclosure controls and procedures and concluded they were effective as of March 31, 2020, with a change in internal control over financial reporting made to adopt a new accounting standard for credit losses, which did not have a material effect - Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2020[323](index=323&type=chunk) - A change was made to internal controls to implement ASU 2016-13 (Credit Losses), which did not have a material impact on the company's financial statements[324](index=324&type=chunk) [PART II – OTHER INFORMATION](index=88&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Legal Proceedings](index=88&type=section&id=Item%201.%20Legal%20Proceedings) The company states that it is not currently involved in any legal proceedings that would have a material adverse effect on its business, operating results, or financial condition - As of the report date, the company is not a party to any material legal proceedings[329](index=329&type=chunk) [Risk Factors](index=88&type=section&id=Item%201A.%20Risk%20Factors) The company faces multiple risks related to its financial viability, product development and commercialization, regulatory approvals, third-party reliance, and the impact of the COVID-19 pandemic - The company has incurred significant losses since inception, with an accumulated deficit of **$429.6 million** as of March 31, 2020, and anticipates continued losses[332](index=332&type=chunk) - The business is substantially dependent on the success of KORSUVA (CR845/difelikefalin) injection, which may not successfully complete trials, receive regulatory approval, or be commercialized[346](index=346&type=chunk) - The COVID-19 pandemic poses a risk to business operations and clinical development, having already affected patient enrollment in a Phase 2 trial and reduced capacity at a third-party manufacturer[357](index=357&type=chunk) - The company relies on third parties for manufacturing and clinical trials, and any failure by these parties to perform satisfactorily could delay product development and commercialization[447](index=447&type=chunk)[454](index=454&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=170&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the reporting period - There were no unregistered sales of equity securities in the quarter ended March 31, 2020[596](index=596&type=chunk) [Other Information](index=170&type=section&id=Item%205.%20Other%20Information) The company reported no other information required to be disclosed under this item - There was no other information to report for the period[602](index=602&type=chunk) [Exhibits](index=172&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including the company's amended and restated certificate of incorporation and bylaws, and certifications by the CEO and Principal Financial Officer as required by the Sarbanes-Oxley Act - The report includes a list of filed exhibits, such as corporate governance documents and required CEO/CFO certifications[606](index=606&type=chunk) ```

Financial Data and Key Metrics Changes - For the year ended December 31, 2019, the company reported a net loss of $106.4 million or $2.49 per share, compared to a net loss of $74 million or $2.06 per share for 2018 [35] - For Q4 2019, the net loss was $28.6 million or $0.61 per share, compared to a net loss of $20.7 million or $0.52 per share for the same quarter in 2018 [36] - Revenues for the year were $19.9 million, up from $13.5 million in 2018, primarily related to a license agreement with Vifor Fresenius [36][37] - Cash, cash equivalents, and marketable securities totaled $218.2 million as of December 31, 2019, compared to $182.8 million at the end of 2018 [42] Business Line Data and Key Metrics Changes - The company advanced the late-stage clinical development of KORSUVA, with positive topline results from the KALM-1 Phase 3 trial in hemodialysis patients [7][8] - The oral KORSUVA program expanded into two new pruritic indications: atopic dermatitis and chronic liver disease associated pruritus, with Phase 2 trials initiated in 2019 [9][10] - The KALM-2 trial was fully enrolled to a target of 430 patients, a 20% increase from the original target, with topline data expected in Q2 2020 [18] Market Data and Key Metrics Changes - There are over 500,000 dialysis patients in the U.S., with 60% reporting some level of pruritus, indicating a significant unmet need in this market [20] - The company has established commercial license agreements in major markets including Japan, South Korea, and the European Union, enhancing its market reach [21] Company Strategy and Development Direction - The company plans to commercialize KORSUVA injection in the U.S. and has established a co-promotion and profit-sharing agreement with Vifor Fresenius [21][22] - The strategy includes advancing KORSUVA to an NDA filing in the second half of 2020, pending positive KALM-2 results, while also initiating pre-commercial activities [22][33] - The company aims to leverage its clinical data to support a broader label for KORSUVA across various pruritic conditions [70] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about multiple major clinical data readouts and regulatory advancements expected in 2020 [11] - The company anticipates that its current cash position will fund operations into the second half of 2021, allowing for continued clinical development [43] - Management acknowledged the challenges of placebo responses in clinical trials and outlined strategies to mitigate these in future studies [54][90] Other Important Information - The company reported a significant increase in R&D expenses, totaling $113.8 million for the year, primarily due to clinical trial costs and stock compensation [38] - General and administrative expenses were $17.7 million for the year, reflecting increases in various operational costs [40] Q&A Session Summary Question: What alignment does the company hope to achieve with the FDA regarding the CKD oral program? - The company aims to propose a 3-point responder analysis as the primary endpoint for the CKD oral study, based on previous consultations with the FDA [50][51] Question: How does the company plan to control the placebo response in future trials? - The company plans to use de novo sites without prior experience with the drug and may incorporate a longer run-in period to identify consistent patient responses [58][59] Question: What is the rationale for increasing the sample size in the atopic dermatitis trial? - The increase was based on maintaining high statistical power to detect a treatment effect, informed by historical placebo rates and treatment effects observed in previous trials [61][76] Question: How will the company approach commercialization for atopic dermatitis and liver disease? - The company is capable of running late-stage trials independently but may consider partnerships for commercialization in these areas [68][70] Question: What are the expected milestones from the collaboration with Vifor Fresenius? - The company anticipates $30 million in regulatory milestones and $430 million in commercial milestones, with further guidance to be provided as timelines for launch and approval become clearer [101]