Exhibit 99.1 DURECT Corporation Reports First Quarter 2024 Financial Results and Business Update - FDA Feedback Supports Single Pivotal Trial for Approval of Larsucosterol in Alcohol-Associated Hepatitis - Webcast of Earnings Call Today, May 13th at 4:30 p.m. ET CUPERTINO, Calif., May 13, 2024 /PRNewswire / -- DURECT Corporation (Nasdaq: DRRX) today announced financial results for the three months ended March 31, 2024 and provided a business update. "We are pleased that the feedback from the U.S. Food and D ...

CUPERTINO, Calif., May 7, 2024 /PRNewswire/ -- DURECT Corporation (Nasdaq: DRRX), a late-stage biopharmaceutical company pioneering the development of epigenetic therapies to transform the treatment of serious and life-threatening conditions, including acute organ injury and cancer, today announced that the company will report its first quarter financial results on Monday, May 13, 2024. Management will also host a conference call and webcast with investors to discuss financial results and provide a corporat ...

CUPERTINO, Calif., April 30, 2024 /PRNewswire/ -- DURECT Corporation (Nasdaq: DRRX), a late-stage biopharmaceutical company pioneering the development of epigenetic therapies to transform the treatment of serious and life-threatening conditions such as acute organ injury and cancer, today announced acceptance of a late-breaking oral presentation at the European Association for the Study of the Liver (EASL) Congress 2024 to take place June 5-8, 2024 in Milan, Italy. The presentation will discuss data from th ...

Part I [Business](index=4&type=section&id=Item%201.%20Business) DURECT Corporation is a biopharmaceutical company focused on its Epigenetic Regulator Program, with its lead candidate, larsucosterol, being developed for alcohol-associated hepatitis (AH) - The company's primary focus is advancing larsucosterol, an epigenetic regulator, for the treatment of alcohol-associated hepatitis (AH), a life-threatening condition with no approved therapies[12](index=12&type=chunk) - Topline data from the Phase 2b AHFIRM trial of larsucosterol showed a clinically meaningful trend in reducing 90-day mortality by **41% (30 mg dose)** and **35% (90 mg dose)** compared to placebo, although the primary endpoint of mortality or liver transplant at 90 days was not met with statistical significance[12](index=12&type=chunk)[27](index=27&type=chunk) - In U.S. patients (**76% of the trial**), larsucosterol showed a more pronounced and statistically significant reduction in 90-day mortality: **57% for the 30 mg dose (p=0.014)** and **58% for the 90 mg dose (p=0.008)**[12](index=12&type=chunk)[33](index=33&type=chunk) - The company generates revenue through multiple streams: licensing of its FDA-approved product POSIMIR® to Innocoll, earn-out payments from Indivior for PERSERIS®, royalties from Orient Pharma for Methydur, and direct sales of its ALZET® osmotic pumps[13](index=13&type=chunk)[15](index=15&type=chunk) [Epigenetic Regulator Program](index=5&type=section&id=Epigenetic%20Regulator%20Program) The program's lead candidate, larsucosterol, is an endogenous epigenetic regulator that inhibits DNMT enzymes, which are over-expressed in severe AH, potentially improving cell survival and reducing inflammation - Larsucosterol acts as an epigenetic regulator by inhibiting DNA methyltransferases (DNMTs), which are over-expressed in the livers of severe AH patients, potentially modulating genes involved in cell death, stress response, and lipid biosynthesis[18](index=18&type=chunk) - The FDA granted Fast Track Designation to larsucosterol for the treatment of AH in December 2020, facilitating its development and review process[43](index=43&type=chunk) AHFIRM Phase 2b Trial - 90-Day Mortality (Key Secondary Endpoint) | Group | Mortality at 90 Days | % Reduction vs. Placebo | p-value | | :--- | :--- | :--- | :--- | | Larsucosterol 30 mg (n=102) | 15.3% | -40.7% | 0.068 | | Larsucosterol 90 mg (n=102) | 16.2% | -34.9% | 0.124 | | Placebo (n=103) | 25.8% / 24.9% | - | - | AHFIRM Phase 2b Trial - 90-Day Mortality (U.S. Patients) | Group | Mortality at 90 Days | % Reduction vs. Placebo | p-value | | :--- | :--- | :--- | :--- | | Larsucosterol 30 mg (n=76) | 12.3% | -56.8% | 0.014 | | Larsucosterol 90 mg (n=78) | 11.7% | -58.1% | 0.008 | | Placebo (n=78) | 28.5% / 27.9% | - | - | - In a Phase 1b study for MASH, orally administered larsucosterol was well tolerated and showed statistically significant reductions in liver enzymes (ALT, AST, GGT) and liver stiffness[45](index=45&type=chunk)[46](index=46&type=chunk) [Approved and Commercial Pharmaceutical Products](index=13&type=section&id=Approved%20and%20Commercial%20Pharmaceutical%20Products) DURECT has several commercial-stage assets, including POSIMIR® licensed to Innocoll, earn-out payments for PERSERIS® from Indivior, and royalties for Methydur from Orient Pharma - POSIMIR® was licensed to Innocoll for U.S. commercialization in December 2021, with DURECT receiving **$4.0 million upfront** and eligible for up to **$122.0 million in additional milestones**, plus tiered low double-digit to mid-teen royalties on net sales[60](index=60&type=chunk)[61](index=61&type=chunk) - The company receives quarterly single-digit earn-out payments on U.S. net sales of Indivior's PERSERIS®, an extended-release injectable for schizophrenia, through 2026[62](index=62&type=chunk)[71](index=71&type=chunk) - Through a collaboration with Orient Pharma, DURECT receives a single-digit royalty on sales of Methydur for ADHD, which launched commercially in Taiwan in September 2020[63](index=63&type=chunk) [Our Strategy](index=14&type=section&id=Our%20Strategy) The company's strategy centers on completing larsucosterol's clinical development for AH, seeking regulatory approval, and exploring commercialization options while leveraging strategic agreements - A key objective is to complete clinical development and seek regulatory approval for larsucosterol for AH, with ongoing communications with the FDA regarding a pivotal Phase 3 trial design[64](index=64&type=chunk) - The company is evaluating whether to license larsucosterol or build a modest, hospital-focused sales force to commercialize it in the U.S. if approved[65](index=65&type=chunk) - DURECT utilizes strategic collaborations to enhance product development, leverage third-party investment, mitigate risk, and reduce net cash burn[66](index=66&type=chunk) [Patents and Proprietary Rights](index=17&type=section&id=Patents%20and%20Proprietary%20Rights) DURECT's intellectual property portfolio includes over 15 issued U.S. patents and over 165 foreign patents, with larsucosterol and POSIMIR covered by multiple patent families - As of March 26, 2024, the company owned or exclusively in-licensed over **15 unexpired U.S. patents** and over **165 unexpired foreign patents**, with numerous applications pending[79](index=79&type=chunk) - The Epigenetic Regulator Program (larsucosterol) is protected by **twenty-one patent families**, with granted patents providing protection until at least 2026, 2032, 2033, 2034, 2035, and 2037, and pending applications potentially extending protection to 2044[80](index=80&type=chunk) - POSIMIR is covered by U.S. patents that could provide protection until 2025, 2026, and 2041, with a pending application that could extend protection to 2042[81](index=81&type=chunk) [Government Regulation](index=18&type=section&id=Government%20Regulation) The company is subject to extensive FDA and global regulations covering all stages of product development, along with various healthcare laws and reforms impacting pricing and reimbursement - The FDA drug development process is extensive, requiring preclinical tests, an effective IND application, and three sequential phases of human clinical trials (Phase 1, 2, and 3) to establish safety and efficacy before an NDA can be submitted for approval[89](index=89&type=chunk)[94](index=94&type=chunk)[95](index=95&type=chunk) - The FDA offers expedited programs like Fast Track, Priority Review, Accelerated Approval, and Breakthrough Therapy to facilitate the development of drugs for serious conditions with unmet medical needs; larsucosterol has received Fast Track Designation[98](index=98&type=chunk)[102](index=102&type=chunk) - The company is subject to numerous healthcare laws beyond FDA regulation, including the federal Anti-Kickback Statute, False Claims Act, and the Physician Payments Sunshine Act, which restrict business practices and require transparency[109](index=109&type=chunk)[110](index=110&type=chunk)[112](index=112&type=chunk) - Healthcare reforms, such as the Affordable Care Act (ACA) and the Inflation Reduction Act of 2022 (IRA), impact the healthcare system through measures like Medicare drug price negotiations and caps on out-of-pocket spending, which could affect future product pricing and profitability[120](index=120&type=chunk)[123](index=123&type=chunk) [Human Capital](index=30&type=section&id=Human%20Capital) As of March 26, 2024, DURECT had 58 employees across R&D, manufacturing, and SG&A, with a focus on attracting and retaining skilled talent through competitive compensation Employee Distribution as of March 26, 2024 | Department | Number of Employees | | :--- | :--- | | Research and Development | 26 | | Manufacturing | 9 | | Selling, General and Administrative | 23 | | **Total** | **58** | - The company's workforce is **64% female** and **36% male**, with at least **24 employees holding advanced degrees** (e.g., MD, PhD, DVM, JD, MBA)[151](index=151&type=chunk) [Risk Factors](index=33&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks, primarily its dependence on the success of larsucosterol, which did not meet its primary endpoint, and substantial doubt about its ability to continue as a going concern - The company is highly dependent on the success of larsucosterol, but its Phase 2b AHFIRM trial did not achieve its primary endpoint, creating uncertainty for its regulatory approval and commercialization[159](index=159&type=chunk)[162](index=162&type=chunk) - The company requires additional capital to continue as a going concern; its recurring losses, negative cash flows, and need for financing raise substantial doubt about its ability to continue operations for the next twelve months[159](index=159&type=chunk)[167](index=167&type=chunk) - Reliance on third-party manufacturers for larsucosterol increases risks of delays in regulatory submissions, insufficient supply, and lack of control over the manufacturing process[159](index=159&type=chunk)[170](index=170&type=chunk) - The company has a significant amount of debt with Oxford Finance, and failure to comply with repayment obligations or covenants could lead to acceleration of the debt[159](index=159&type=chunk)[196](index=196&type=chunk) - DURECT does not control the commercialization of its key revenue-generating licensed products, POSIMIR (Innocoll), PERSERIS (Indivior), and Methydur (Orient Pharma), making it dependent on its partners' success[159](index=159&type=chunk)[201](index=201&type=chunk) - The company's stock price may not meet Nasdaq's minimum bid price requirement, which could lead to delisting and adversely affect liquidity and the ability to raise capital[161](index=161&type=chunk)[273](index=273&type=chunk) [Cybersecurity](index=68&type=section&id=Item%201C.%20Cybersecurity) DURECT manages cybersecurity risks through a formal program overseen by the Audit Committee, implementing regular monitoring, vulnerability assessments, and employee training, with no material incidents reported - The Audit Committee of the Board is responsible for overseeing risks from cybersecurity threats and receives at least an annual overview from management[302](index=302&type=chunk) - The company's cybersecurity program includes regular network monitoring, vulnerability assessments, penetration testing, employee training, and phishing simulations, with processes compared to NIST standards[296](index=296&type=chunk) - The cybersecurity program is led by the Executive Director of IT, who has over **25 years of relevant experience** and reports to the CEO and informs the Audit Committee[303](index=303&type=chunk)[305](index=305&type=chunk) - The company has experienced no material cybersecurity incidents in the last two fiscal years, and related expenses have been immaterial[300](index=300&type=chunk) [Properties](index=70&type=section&id=Item%202.%20Properties) DURECT leases two facilities in California: a 30,149 sq. ft. office, lab, and manufacturing space in Cupertino expiring in 2027, and a 24,634 sq. ft. manufacturing facility in Vacaville expiring in 2028 Leased Facilities | Location | Square Feet | Operation | Lease Expiration | | :--- | :--- | :--- | :--- | | Cupertino, CA | 30,149 | Office, Laboratory and Manufacturing | 2027 (with 5-year renewal option) | | Vacaville, CA | 24,634 | Manufacturing | 2028 (with 5-year renewal option) | Part II [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=72&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) For FY2023, DURECT reported a net loss of **$27.6 million** on total revenues of **$8.5 million**, a decrease from FY2022, with R&D expenses falling due to trial completion, and substantial doubt about its going concern ability Financial Performance (2023 vs. 2022) | Metric | 2023 (in millions) | 2022 (in millions) | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $8.5 | $19.3 | -56% | | R&D Expenses | $29.4 | $36.9 | -20% | | SG&A Expenses | $14.4 | $15.9 | -9% | | Net Loss | ($27.6) | ($35.3) | +22% (less loss) | | Cash & Investments (Year-End) | $29.8 | $43.6 | -32% | - The significant decrease in 2023 revenue was primarily due to the absence of milestone payments from Innocoll, which totaled **$10.0 million** in 2022[351](index=351&type=chunk) - Research and development expenses decreased by **$7.5 million** in 2023, mainly due to lower clinical trial costs as the AHFIRM trial for larsucosterol was substantially completed[359](index=359&type=chunk)[361](index=361&type=chunk) - The company has concluded that substantial doubt exists about its ability to continue as a going concern, as it does not have sufficient cash to fund planned operations through the next 12 months[329](index=329&type=chunk)[393](index=393&type=chunk)[395](index=395&type=chunk) [Results of Operations](index=78&type=section&id=Results%20of%20Operations) In 2023, total revenues declined to **$8.5 million** from **$19.3 million** in 2022, primarily due to a **$10.9 million** decrease in collaborative R&D revenue, while the net loss improved to **$27.6 million** due to reduced operating expenses and a non-cash gain Revenue Breakdown (in thousands) | Revenue Source | 2023 | 2022 | | :--- | :--- | :--- | | Collaborative R&D and Other | $2,277 | $13,204 | | Product Revenue, net | $6,271 | $6,079 | | **Total Revenues** | **$8,548** | **$19,283** | Operating Expenses (in thousands) | Expense Category | 2023 | 2022 | | :--- | :--- | :--- | | Cost of product revenues | $1,717 | $1,588 | | Research and development | $29,351 | $36,862 | | Selling, general and administrative | $14,364 | $15,915 | | **Total Operating Expenses** | **$45,432** | **$54,365** | - The change in fair value of warrant liabilities resulted in a non-cash gain of **$13.6 million** in 2023, significantly reducing the net loss[370](index=370&type=chunk) [Liquidity and Capital Resources](index=83&type=section&id=Liquidity%20and%20Capital%20Resources) DURECT ended 2023 with **$29.8 million** in cash, down from **$43.6 million**, with **$34.4 million** used in operations, leading to management and auditor conclusions of substantial doubt about its going concern ability - The company's cash, cash equivalents, and investments decreased to **$29.8 million** at Dec 31, 2023, from **$43.6 million** at Dec 31, 2022[378](index=378&type=chunk) - Cash used in operating activities increased to **$34.4 million** in 2023 from **$26.3 million** in 2022, primarily due to lower payments received from collaborators[381](index=381&type=chunk) - The company raised **$20.5 million** from financing activities in 2023, mainly from two registered direct offerings and sales under its ATM facility[383](index=383&type=chunk) - The company's independent registered public accounting firm included an explanatory paragraph in its report expressing substantial doubt about the company's ability to continue as a going concern[398](index=398&type=chunk)[409](index=409&type=chunk) [Financial Statements and Supplementary Data](index=88&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) The audited financial statements for FY2023 show total assets of **$45.2 million** and liabilities of **$30.4 million**, with the auditor expressing substantial doubt about the company's going concern ability due to accumulated deficit and negative cash flows Balance Sheet Summary (in thousands) | Account | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $28,400 | $43,483 | | Total current assets | $34,671 | $51,394 | | Total assets | $45,189 | $60,100 | | **Liabilities & Equity** | | | | Total current liabilities | $27,011 | $34,004 | | Term loan, current portion, net | $16,663 | $21,170 | | Total liabilities | $30,406 | $35,115 | | Total stockholders' equity | $14,783 | $24,985 | Statement of Operations Summary (in thousands) | Account | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Total revenues | $8,548 | $19,283 | $13,977 | | Total operating expenses | $45,432 | $54,365 | $48,250 | | Loss from operations | ($36,884) | ($35,082) | ($34,273) | | Net loss | ($27,624) | ($35,333) | ($36,265) | | Net loss per share - basic | ($1.05) | ($1.55) | ($1.61) | - The independent auditor's report contains an explanatory paragraph regarding the company's ability to continue as a going concern due to its accumulated deficit and negative cash flows from operations[409](index=409&type=chunk) - In February and July 2023, the company issued common and pre-funded warrants which are accounted for as liabilities and re-measured to fair value each period, causing significant fluctuations in 'Other income (expense)'[495](index=495&type=chunk)[500](index=500&type=chunk) [Controls and Procedures](index=126&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and internal control over financial reporting were effective as of December 31, 2023, with no material changes identified - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of December 31, 2023[576](index=576&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of December 31, 2023, based on the COSO framework[578](index=578&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=128&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) The company's Board of Directors is divided into three staggered classes, with most directors deemed independent, and the Audit Committee overseeing financial reporting and the independent auditor - The Board of Directors is divided into three classes with staggered three-year terms[588](index=588&type=chunk) - The Board has determined that all directors are independent under Nasdaq rules, with the exception of CEO James E. Brown and Dr. Gail M. Farfel[705](index=705&type=chunk) - The Audit Committee is composed of independent directors Peter S. Garcia (Chair), Gail J. Maderis, and Judy J. Robertson; Mr. Garcia is designated as the 'audit committee financial expert'[604](index=604&type=chunk)[608](index=608&type=chunk) - The company has an insider trading policy that prohibits hedging transactions and short sales by officers, directors, and other insiders[609](index=609&type=chunk) [Executive Compensation](index=133&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation aims to attract and retain key employees through base salary, bonus, and equity incentives, benchmarked against a peer group, with performance-based options tied to larsucosterol milestones - The Compensation Committee uses a peer group of **15 public life sciences companies** to benchmark executive compensation, generally targeting the **50th percentile**[623](index=623&type=chunk)[624](index=624&type=chunk) 2023 Named Executive Officer Base Salaries | Name | 2023 Base Salary ($) | | :--- | :--- | | James E. Brown | 597,914 | | Timothy M. Papp | 431,600 | | Norman L. Sussman | 429,865 | - No cash bonuses were awarded to Named Executive Officers for fiscal year 2023 performance[637](index=637&type=chunk)[638](index=638&type=chunk) - In August 2023, the company granted performance-based stock options to NEOs and certain employees, which vest upon achieving specific development and regulatory milestones for larsucosterol[644](index=644&type=chunk) - The company maintains a change of control policy providing officers with severance (**1 year of salary**; **2 years for the CEO**) and accelerated vesting of stock options if terminated without cause in connection with a change of control[677](index=677&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=149&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) As of March 26, 2024, Ingalls & Snyder, LLC is the only stockholder with over **5%** ownership (**8.2%**), while all executive officers and directors collectively own **3.2%** of the outstanding common stock - As of March 26, 2024, Ingalls & Snyder, LLC was the only beneficial owner of more than **5%** of the company's common stock, holding **2,558,012 shares**, or **8.2%**[695](index=695&type=chunk) - All executive officers and directors as a group (**9 persons**) beneficially owned **1,001,846 shares**, representing **3.2%** of the common stock outstanding[695](index=695&type=chunk) Equity Compensation Plan Information (as of Dec 31, 2023) | Plan Category | Securities to be Issued Upon Exercise | Weighted-Average Exercise Price | Securities Remaining for Future Issuance | | :--- | :--- | :--- | :--- | | Approved by security holders | 4,128,259 | $9.37 | 940,875 | [Principal Accountant Fees and Services](index=153&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) For fiscal year 2023, DURECT was billed a total of **$1,321,822** by Ernst & Young LLP, comprising **$1,238,524** for audit fees and **$83,298** for tax fees, all pre-approved by the Audit Committee Accountant Fees (2023 vs. 2022) | Fee Type | 2023 | 2022 | | :--- | :--- | :--- | | Audit Fees | $1,238,524 | $974,200 | | Tax Fees | $83,298 | $76,146 | | **Total** | **$1,321,822** | **$1,050,346** |

DURECT Corporation (NASDAQ:DRRX) Q4 2023 Earnings Call Transcript March 27, 2024 4:30 PM ET Company Participants Tim Papp - CFO Jim Brown - CEO Norman Sussman - CMO Keith Lui - SVP, Business Development, Commercial, Medical Affairs Conference Call Participants Francois Brisebois - Oppenheimer & Co. Carl Byrnes - Northland Capital Markets Thomas Yip - H.C. Wainwright Operator Greetings and welcome to the DURECT Corporation Full Quarter and Full Year Earnings Conference Call. At this time, all participants ar ...

Exhibit 99.1 DURECT Corporation Reports Fourth Quarter and Full Year 2023 Financial Results and Provides Business Update - Ongoing Communication with FDA to Align on Next Steps for Larsucosterol in Alcohol-Associated Hepatitis - Webcast of Earnings Call Today, March 27th at 4:30 p.m. ET CUPERTINO, Calif., March 27, 2024 /PRNewswire / -- DURECT Corporation (Nasdaq: DRRX) today announced financial results for the fourth quarter and year ended December 31, 2023 and provided a business update. "We remain enthus ...

CUPERTINO, Calif., March 20, 2024 /PRNewswire/ -- DURECT Corporation (Nasdaq: DRRX), a late-stage biopharmaceutical company pioneering the development of epigenetic therapies to transform the treatment of serious and life-threatening conditions, including acute organ injury and cancer, today announced that the company will report its fourth quarter and full year 2023 financial results on Wednesday, March 27, 2024. Management will also host a conference call and webcast with investors to discuss financial re ...

Partnership agreement will be the first-ever co-marketing and sales collaboration for the ALZET Osmotic Pumps Portfolio and Associated Product Line in the U.S. and Canada Both companies will jointly market and commercialize the ALZET product line to customers over a multi-year period CUPERTINO, Calif. , March 4, 2024 /PRNewswire/ -- DURECT Corporation (Nasdaq: DRRX), today announced that it has entered into a co-marketing and collaboration agreement with Charles River Laboratories for the ALZET® Osmotic P ...

CUPERTINO, Calif., Feb. 7, 2024 /PRNewswire/ -- DURECT Corporation (Nasdaq: DRRX) today announced that James E. Brown, President and Chief Executive Officer, will present at the Oppenheimer 34th Annual Healthcare Life Sciences Conference, to be held virtually, February 13-14, 2024. Presentation details are as follows: Date and Time:              Wednesday, February 14, 10:40 a.m. ET Webcast:                          https://wsw.com/webcast/oppenheimer33/drrx/2815552 A link to the webcast will al ...

DURECT Corporation (NASDAQ:DRRX) Q3 2023 Earnings Conference Call November 13, 2023 4:30 PM ET Company Participants Tim Papp - Chief Financial Officer Jim Brown - Chief Executive Officer Conference Call Participants François Brisebois - Oppenheimer Carl Byrnes - Northland Capital Markets Thomas Yip - H.C. Wainwright Operator Good afternoon, everyone, and welcome to the DURECT Corporation Third Quarter Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After tod ...