Daré Bioscience(DARE) - 2022 Q4 - Annual Report

Product Development and Clinical Trials - Daré Bioscience's first product, XACIATO, received FDA approval in December 2021 and is expected to launch in the U.S. in the first half of 2023, with potential future revenue from royalties and milestone payments from Organon[21][29] - The company aims to advance clinical development of its product candidates, including the pivotal Phase 3 study of Ovaprene, which is expected to commence in mid-2023[26][40] - Ovaprene is designed to be a hormone-free monthly contraceptive with a typical use efficacy approaching 91%, and it has shown effectiveness in preventing sperm from reaching the cervical canal in clinical trials[33][38] - The pivotal Phase 3 study of Ovaprene will target approximately 200 to 250 subjects, with recruitment expected to begin in mid-2023[40] - Sildenafil Cream, 3.6% is being developed as a potential first FDA-approved treatment for female sexual arousal disorder (FSAD), leveraging the established safety profile of sildenafil[45] - In a Phase 2a study, 31 out of 35 enrolled women completed the trial, showing significant increases in genital blood flow compared to placebo approximately 30 minutes post-dosing[48] - The exploratory Phase 2b RESPOND clinical study of Sildenafil Cream, 3.6% is expected to include approximately 160 to 170 subjects, with topline data assessment targeted for Q2 2023[53] - DARE-HRT1 is designed to deliver bio-identical 17β-estradiol and progesterone continuously over 28 days, aiming to treat moderate to severe vasomotor symptoms due to menopause[56] - The Phase 1 clinical trial of DARE-HRT1 demonstrated that the IVRs were well tolerated, with no serious adverse events reported, supporting its potential as a new hormone therapy option[61] - Topline data from the Phase 1/2 study of DARE-HRT1 showed steady-state release levels of estradiol (E2) and progesterone (P4) that met or exceeded targets for hormone therapy[63] - The levels of E2 released from both DARE-HRT1 formulations achieved statistically significant improvements in vasomotor symptoms and vaginal health indicators[65] - DARE-HRT1 significantly reduced menopausal symptoms, with p<0.01 for hot flashes, night sweats, and all domains of the Menopausal Quality of Life Survey (MENQOL) compared to baseline[66] - DARE-VVA1 is being developed as a hormone-free alternative for treating moderate to severe vulvar and vaginal atrophy (VVA), with a prevalence of 42-70% in postmenopausal breast cancer patients[70] - In a Phase 1/2 study of DARE-VVA1, 39% of participants reported vaginal dryness and 62% reported dyspareunia as their most bothersome symptoms at baseline, with significant improvements noted by the end of the treatment[76] - DARE-PDM1 is a hydrogel formulation of diclofenac for vaginal administration, targeting primary dysmenorrhea, with a Phase 1 study expected to enroll approximately 36 healthy premenopausal women[80][81] - DARE-204 and DARE-214 are being developed as long-acting contraceptive options, with plans to utilize the FDA's 505(b)(2) pathway for marketing approval if successful[83] - DARE-FRT1 and DARE-PTB1 are IVRs designed to release bio-identical progesterone, with development activities underway for Phase 1 clinical studies[85] Strategic Collaborations and Funding - The company is pursuing strategic collaborations, including agreements with Organon and Bayer, to enhance its development and commercialization capabilities[26] - Daré has received non-dilutive funding to support the development of various programs, including Ovaprene and DARE-LARC1[26] - The company has entered into a license agreement with Organon, receiving a $10.0 million non-refundable payment and is entitled to tiered double-digit royalties based on net sales, with potential milestone payments up to $182.5 million[98] - The Bayer license agreement includes a $1.0 million upfront payment and potential milestone payments totaling up to $310.0 million based on sales milestones, with tiered royalties starting in the low double digits[105] - The DARE-LARC1 program has received approximately $23.9 million of a potential $49.0 million grant to advance development through nonclinical studies[87] - The DARE-LBT program is supported by a grant of approximately $585,000 for developing a vaginal thermosetting gel formulation for live biotherapeutics delivery[88] - The company acquired Dare MB Inc. to develop DARE-LARC1, a long-acting reversible contraception method, issuing approximately 3.0 million shares and agreeing to contingent payments up to $101.5 million[113][114] Regulatory and Compliance Challenges - The company must submit a New Drug Application (NDA) to the FDA, which includes all relevant data from clinical trials and must demonstrate safety and efficacy[195] - Regulatory approvals require substantial time and financial resources, with potential sanctions for non-compliance that could adversely affect the company[177][179] - The FDA's approval process involves extensive data submission, which is expensive and time-consuming, and may not result in timely approvals[181][195] - The FDA may require a diversity action plan for Phase 3 clinical trials, which could impact trial planning and timing[189] - The FDA has a ten-month review period for standard NDAs and six months for priority reviews, but these timelines can be extended due to requests for additional information[197] - Approval of an NDA is contingent upon compliance with cGMP requirements and successful inspections of manufacturing facilities and clinical trial sites[200] - A REMS plan may be required if the FDA determines it necessary to ensure the drug's benefits outweigh its risks[201] - The FDA issues either an approval letter or a complete response letter (CRL) detailing deficiencies in the NDA, which may require additional clinical trials or labeling changes[202] - Post-approval, the FDA continues to regulate the drug, including monitoring adverse experiences and compliance with promotional restrictions[211] - The FDA may withdraw approval if regulatory compliance is not maintained or if new safety issues arise post-market[215] - The Drug Supply Chain Security Act mandates a phased-in electronic system for tracing prescription drugs, with full implementation expected by November 2023[215] Market Competition and Product Positioning - XACIATO will compete with existing branded and generic products for bacterial vaginosis, with its commercial success largely dependent on the agreement with Organon[171] - Ovaprene, if approved, will face competition from a variety of contraceptive options, including both hormonal and non-hormonal methods[172] - Sildenafil Cream, 3.6% has the potential to be the first FDA-approved product for the treatment of FSAD[173] - DARE-HRT1, if approved, will compete with various FDA-approved products for menopausal symptoms, including hormone therapies in different forms[174] - The company anticipates that options for hormone therapy will continue to expand over time, addressing preferences for bio-identical hormones delivered non-orally[174] - The success of the company's product candidates may be impacted by the efficacy and safety of competing products, as well as regulatory approvals[175][176] Financial Considerations and Milestones - A total of $1.25 million in contingent consideration was payable upon achieving certain funding and product development milestones, with $1.0 million recorded as contingent consideration and $250,000 expensed in 2021[116] - Approximately 700,000 shares of common stock were issued to former stockholders of MBI as part of the milestone payments, along with $75,000 in cash[116] - MilanaPharm is eligible to receive up to $500,000 upon the first commercial sale in the U.S. of the first licensed product for each vaginal and urological use, and up to $250,000 for successive licensed products[119] - Cumulative worldwide net sales of licensed products reaching $50 million will trigger a $1.0 million payment to MilanaPharm[119] - Catalent is eligible to receive up to $13.5 million in milestone payments based on specified clinical and regulatory milestones, with $1.0 million payable in 2021[138] - The annual maintenance fee to Catalent is $100,000, creditable against royalties and other payments due in the same calendar year[137] - Former stockholders of Pear Tree are eligible for up to $15.5 million in milestone payments based on clinical development and regulatory milestones, and up to $47.0 million for commercial milestones[131] - The royalty term for licensed products is determined on a country-by-country and product-by-product basis, lasting until the expiration of the last valid claim or 10 years after the first commercial sale[121] - The company must use commercially reasonable efforts to develop and commercialize at least one licensed product in the U.S. and one in select European countries[122] - The license agreements will convert to fully-paid irrevocable licenses upon expiration, ensuring continued rights to the licensed intellectual property[141] - SST is eligible to receive tiered royalties based on annual net sales of Licensed Products, ranging from single digits to mid double digits[147] - Milestone payments to SST can range from $0.5 million to $18.0 million for clinical and regulatory milestones, and from $10.0 million to $100 million for commercial sales milestones[148] - The license agreement with ADVA-Tec requires a minimum annual spending of $2.5 million until a final PMA is filed or the first commercial sale of Ovaprene[152] - ADVA-Tec is eligible for royalties between 1% and 10% based on aggregate annual net sales of Ovaprene, with rates increasing based on sales thresholds[155] - The ADVA-Tec agreement includes milestone payments of up to $14.6 million for development and regulatory milestones, and up to $20 million for worldwide net sales milestones[154] - The patent terms for key technologies include U.S. patents expiring between 2025 and 2042, subject to extensions or disclaimers[160][161][162][163][164][166][167]