Dare Bioscience Inc (DARE) 2020 Q4 法說會逐字稿

Welcome to the conference call hosted by Daré Bioscience to review the company's financial results for the year ended December 31, 2020, and to provide a general business update. This call is being recorded. My name is Sara, and I will be your operator today.

With us today are Sabrina Martucci Johnson, Daré's President and Chief Executive Officer; John Fair, Daré's Chief Strategy Officer; and Lisa Walters-Hoffert, Daré's Chief Financial Officer.

Ms. Johnson, please proceed.

Thank you. Good afternoon, and welcome to our 2020 financial results and business update call for Daré Bioscience. Our plan today is to review last year's financial results, discuss notable achievements since our last call in November and use the time to highlight developments and milestones anticipated for 2021.

Before I begin, I would like to remind you that today's discussion will include forward-looking statements within the meaning of federal securities laws, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements made during this call that are not statements of historical facts should be considered forward-looking statements. Actual results or events could differ materially from those anticipated or implied by these statements due to known and unknown risks and uncertainties. You should not place undue reliance on forward-looking statements. Forward-looking statements are qualified in their entirety by the cautionary statements in the company's SEC filings, including our annual report on Form 10-K and in our quarterly reports on Form 10-Q.

I would also like to point out that the content of this call includes time-sensitive information that is current only as of today, March 30, 2021. Daré undertakes no obligation to update any forward-looking statements to reflect new information or developments after this call, except as required by law.

As you know, Daré is a leader in women's health innovation, and we are squarely focused on improving the lives and well-being of women. Our value creation strategy is to accelerate availability of new prescription products for women by selecting and advancing product candidates that we believe have the potential to be first in category and first-line and have meaningful commercial opportunity, with 4 clinical-stage programs in vaginal health, sexual health, contraception and menopause.

Despite the unique challenges posed for all of us during 2021, we achieved 2 important corporate first in 2021. We started the year in January by announcing our first commercial partnership agreement with Bayer for Ovaprene commercialization rights. We believe that this partnership not only validates the Ovaprene commercial opportunity and allows Daré to benefit from Bayer's expertise and development, regulatory affairs and commercialization of first in category contraceptive products for women, but with opportunity for a $20 million clinical milestone up to $310 million in commercial milestone payments plus double-digit tiered royalties on net sales. But it also can provide capital to support broader portfolio objectives.

Then we ended the year in December with the completion of our first portfolio Phase III study. Specifically, we announced positive top line data from the DARE-BVFREE Phase III study of DARE-BV1 for the treatment of bacterial vaginosis, positioning Daré for our first NDA submission. The advances in 2020 across the portfolio set the stage for meaningful portfolio objectives in 2021.

So for those of you who are new to Daré, 2021 is an interesting time to get to know us. Our prior 3 positive clinical readouts across 3 different portfolio programs, the Phase I thermography study for Sildenafil Cream and the pre-pivotal study of Ovaprene, both announced in 2019 and the DARE-BV1 Phase III that I just mentioned, announced in 2020, enabled us to target 2 more clinical readouts and an NDA filing and potential approval action in 2021. The 2021 key portfolio objectives include the following, which encompasses not just those 3 programs I already mentioned, but 2 additional clinical stage development programs as well.

We'll cover each of these in more detail during today's call, but here are the highlights as we look forward in 2021. For DARE-BV1, the new drug application, the NDA submission, the potential PDUFA action and strategic commercialization agreement. Sildenafil Cream, the Phase IIb clinical study commencement and potential top line data. Ovaprene, the investigational drug exemption submission. DARE-HRT1, Phase I clinical study top line data. And DARE-VVA1, initiation of Phase I clinical study.

So I'm going to start first with DARE-BV1. DARE-BV1 is our novel, investigational thermosetting bio-adhesive hydrogel formulated with clindamycin phosphate 2% as a first-line, single-administration vaginal treatment for bacterial vaginosis. We announced the successful completion of the DARE-BVFREE Phase III clinical study in 4Q 2020. DARE-BV1 demonstrated best-in-class curative potential for the most common vaginal infection in women of reproductive age, affecting an estimated 21 million women in the U.S. Bacterial vaginosis causes very disruptive symptoms for her, a vaginal odor and discharge and is importantly linked to health risk, including preterm birth, sexually transmitted infections, post-surgical infection and pelvic inflammatory disease.

It is estimated that 16% of these women have symptomatic disease and studies have shown recurrence rates of up to 60% within 12 months of treatment. The DARE-BVFREE study demonstrated DARE-BV1's potential to provide improved clinical cure rates and improved patient outcomes compared to those of current branded prescription products for the treatment of bacterial vaginosis, which those core products have cure rates in the 37% to 68% range, including in both the modified intent-to-treat population, which is the primary efficacy assessment and FDA guidance documents as well as the per protocol population. Those current branded vaginal prescription products are at the lower end of that range with the vaginal product cure rate of 37% to 54% on a modified intent-to-treat basis and 64% on a per protocol basis. As I mentioned, in our Phase III study, DARE-BV1 delivered better clinical cure rate values than those have been demonstrated by the currently marketed FDA-approved vaginal and oral products for the treatment of bacterial vaginosis on both a modified intent-to-treat and the per protocol population basis.

Specifically, in the modified intent-to-treat population, the clinical cure rates for DARE-BV1 and the DARE-BVFREE study were 70% at the test of cure visit, which occurred 21 to 30 days after the study administration, the primary endpoint, and 76% at the assessment visit that occurred just 7 to 14 days after study drug administration compared to 36% and 24% for placebo cream, respectively. In the per protocol population, the clinical cure rates for DARE-BV1 were 77% at the day 21 to 30 endpoint analysis and 81% at the day 7 to 14 compared to 42 and 30 for placebo cream, respectively.

Further, these results were achieved in what we believe was a representative patient population, including a large proportion of patients who reported 1 or more episodes of bacterial vaginosis in the 12 months before they are randomized into the study, 75% of the intent-to-treat population. And in addition, this was the first study conducted under the new 2019 FDA guidance for bacterial vaginosis treatment that requires that all subjects in the modified intent-to-treat population, the primary endpoint population, not only meet the clinical diagnostic criteria for bacterial vaginosis, but at baseline, they also need to meet the bacterial morphology classification or a Nugent score of at least 7 reflective of bacterial vaginosis.

Given these data, we believe DARE-BV1 is positioned to be an important first-line option for the treatment of bacterial vaginosis. And we're working to advance DARE-BV1 toward regulatory approval in the U.S. The NDA submission to the U.S. Food and Drug Administration, the FDA, is planned for the second quarter.

The product candidates fast track and qualified infectious disease product designation allow for a priority review request at the time of NDA submission, which, if granted by the FDA, could lead to a 2021 PDUFA goal date. Specifically, that means that as long as the NDA is submitted by June 30 of 2021, we would be notified of acceptability of the filing by July 31 of 2021, and whether priority review is granted. And if priority review is granted, the PDUFA action date would be prior to December 31, 2021. Our 2021 FDA approval would allow for commercialization of DARE-BV1 in 2022.

Ongoing strategic discussions and other activities to support a robust market introduction in 2021 -- in 2022, if approved, are thus underway. So in 2021, we intend to finalize and announce the collaboration strategy for DARE-BV1 commercialization in the U.S. John will discuss this in greater detail shortly, and will provide additional insights on how we seek to capture maximum strategic value for our shareholders in our approach to the process.

I'm now going to talk about Sildenafil Cream 3.6%. So Sildenafil Cream is an investigational cream formulation of sildenafil, the active ingredient in Viagra for topical administration to treat female sexual arousal disorder or FSAD. FSAD is a physiological condition characterized by the inability to attain or maintain sufficient general arousal during sexual activity. And of the various types of female sexual dysfunction disorders, it is the most analogous to erectile dysfunction in men.

FSAD represents a large unmet need with an estimated 10 million women in the U.S. experiencing distress from symptoms of low or no sexual arousal and actively seeking treatment. Nonetheless, no FDA-approved products exist today to treat FSAD, even though the FSAD market is estimated to be as significant, if not more so, as the erectile dysfunction market in both the U.S. and the rest of the world.

On March 24, we announced that we commenced our Phase IIb RESPOND clinical study evaluating Sildenafil Cream as a potential treatment for FSAD, with a top line data readout targeted for year-end 2021. If clinical development is successful, Sildenafil Cream has the potential to be the first FDA-approved FSAD treatment option.

The Phase IIb RESPOND study will evaluate Sildenafil Cream compared to placebo cream in pre- and peri-menopausal women over 12 weeks of at-home use following both a nondrug and a placebo run-in period. Patient-reported outcome, or PRO, instruments will be used to screen eligible women with FSAD and to measure achievement of the primary efficacy end point, namely improvement in localized general sensations of arousal and reduction in the distress that women with FSAD experience.

Commencing the study now positions us for a potential top line data readout by the end of 2021. And over the next several months, we will provide updates on our progress towards that target. Women have suffered far too long without a viable intervention to address FSAD, so it is exciting to be working at the cutting-edge of research focused on women's sexual health and to advance a potential first in category treatment option for women suffering with FSAD. We are very much looking forward to keeping you updated on our progress this year with that program.

Next, I'm going to talk about Ovaprene. Ovaprene is our novel, investigational hormone-free monthly intravaginal contraceptive. As already mentioned, we entered into a commercial partnership agreement with Bayer in January of 2020 on the heels of that positive pre pivotal data announcement in 2019. People often ask how involved Bayer is currently in the program. Given under the terms of our agreement with Daré and with them, Daré is responsible for the ongoing regulatory interactions and the upcoming pivotal trial to support the FDA submission.

Well, as you may recall, under the terms of the agreement, Bayer provides up to 2 full-time equivalents at this point for advisory support. So put another way up to 80 hours per week of advisory support to Daré. Thus, our teams meet multiple times per week. And these meetings include interactions across functional areas such as manufacturing, clinical, regulatory, medical affairs, and commercialization planning.

Unlike bacterial vaginosis, where clinicians have familiarity with the concept of a onetime vaginal treatment and are very familiar with bacterial vaginosis, which in turn reduces the amount of preparation that's required prelaunch, the pre-commercialization activities are critical with a disruptive product like Ovaprene that is so unlike any contraceptive available today. Thus, similar to the launch preparation work that Bayer had to undertake before they successfully launched the Mirena franchise, the first hormone-releasing intrauterine device franchise to the $1 billion-plus revenue it represents today, there is Ovaprene work underway already to ensure that pending successful completion of the pivotal study and FDA approval, we are ready as partners.

In terms of next steps on that path to commencing that pivotal study for FDA registration, the IDE submission to the FDA is planned for the fourth quarter of 2021. This is a requirement for initiating a pivotal contraceptive clinical study in the U.S. We are designing the study to evaluate Ovaprene when used over a period of at least 6 months and up to 12 months. And well seemed to confirm alignment with the FDA on the studies designed prior to commencement.

Pending clearance of the IDE, the pivotal Phase III clinical study commencement is planned for the first quarter of 2022, enabling a 6-month data readout by the end of 2022.

I'm now going to touch on DARE-HRT1. DARE-HRT1 is our unique, investigational 28-day intravaginal ring, or IVR, containing bio-identical estradiol and bio-identical progesterone for the treatment of the vasomotor symptoms and genitourinary syndrome associated with menopause. On March 22, we announced completion of the enrollment in the Phase I clinical study in Australia, and that we expect top line data readout in the second quarter of 2021.

The IVR drug delivery technology used in DARE-HRT1 was developed by Dr. Bob Langer from MIT and Dr. Bill Crowley from the Massachusetts General Hospital and Harvard Medical School. And it's an important platform for Daré as we believe it offers a versatile drug delivery system in women's health with the potential to improve convenience and outcomes.

In fact, our DARE-HRT1 program utilizes the same vaginal ring technology and is being developed to deliver bio-identical progesterone over a 14-day period for the prevention of preterm birth and broader luteal phase support as part of an in vitro fertilization, or IVF regimen. You may recall that a grant awarded in 2020 by the Eunice Kennedy Shriver National Institute of Child Health and Human Development, a division of the NIH, is supporting our preclinical development activities for DARE-FRT1 and that we may be eligible to receive up to $2.3 million in total grant funding in support of continued development of DARE-FRT1 including that Phase I clinical trial that we're targeting for 2022.

The objective of the DARE-HRT1 Phase I, where we just completed enrollment is to evaluate the ability of DARE-HRT1 to achieve its dual release objectives as well as the ability of the IVR technology to release 2 different active drugs at 2 different rates. As Lisa will discuss shortly, conducting the Phase I study activities through our subsidiary in Australia is an example of an approach similar to securing the nondilutive grant funding that I just talked about to be capital-efficient, as it makes us eligible to receive future R&D tax incentives in the form of cash payments back to Daré through Australia's R&D tax incentive program.

Finally, before I turn it over to my colleagues, I wanted to just mention the DARE-VVA1 Phase I study that we plan to commence this year that I mentioned upfront. So DARE-VVA1 is our proprietary, investigational formulation of tamoxifen for vaginal administration to treat vulvar and vaginal atrophy, or VVA, in women with or at risk of hormone-receptor positive breast cancer.

We plan to commence the Phase I clinical study in the second half of 2021 in Australia, where we plan to leverage that development tax incentive of currently 43.5% of every eligible dollar spent as a cash payment back to the company.

With that, I'm now going to turn it over to John to provide a business and corporate partnership update.

Thank you, Sabrina. We're entering an exciting time for DARE-BV1 as the NDA submission will move us 1 step closer to the introduction of this important new product for the treatment of bacterial vaginosis. We continue to be impressed with the level of interest in the product candidate as we are seeing broad activity from large strategic pharmaceutical manufacturers as well as emerging specialty health care companies interested in adding a new and differentiated product to their portfolio.

As we've communicated in the past, we look forward to announcing our commercialization strategy for DARE-BV1, following the execution of a definitive agreement. However, because we are often asked about timing, I wanted to start by providing some context on our process. I can reiterate that we believe it's in our best interest to continue to advance our partnering discussions in parallel with our regulatory discussions, which we believe derisks and adds value to the DARE-BV1 program.

We have the flexibility to work in parallel because of the clinician awareness of bacterial vaginosis and the straightforward product profile of DARE-BV1 which mitigates some of the traditional market softening efforts required with an NCE or a new therapeutic indication. We believe that we are positioned to execute a definitive commercialization agreement before the end of the year.

And as we think broadly about our commercialization strategies, we also have considerable optionality on what type of commercialization partnership structure we can contemplate. The fact that we have a portfolio of multiple women's health products in development means that all forms of structures are viable from direct involvement in commercialization to a collaboration with a contract sales organization to a complete commercial out-license similar to the deal we executed with Bayer for Ovaprene, where Bayer has complete responsibility for commercialization.

Being able to play a role in the commercialization of DARE-BV1 is much more tenable for us today than it was 18 months ago. And the reasons for that are driven by the appreciable reduction in the size and scale of a field force that we believe would be required to reach the targeted number of health care providers to make the brand successful.

With the implementation of remote and virtual provider detailing, driven almost entirely by the COVID-19 pandemic, organizations like ours can achieve a much greater efficiency and scale more quickly with fewer full-time resources and thus reduced expense. Doctors have adjusted their workflow to accommodate virtual visits with sales representatives, and we believe this will continue even after the pandemic is over. All of this taken together provides us greater optionality to pick the commercialization partnership structure that we believe is best suited for DARE-BV1 for patients and for our shareholders.

In summary, given the data from the DARE-BVFREE Phase III study and the compelling value proposition of DARE-BV1, all options are on the table.

Turning briefly to Ovaprene. I want to reiterate some of the comments Sabrina made about the Bayer partnership. We believe our relationship with Bayer continues to be value additive for both companies. Our 2 organizations are operating synergistically across a number of key work streams ranging from manufacturing, regulatory affairs, medical affairs and brand planning, which includes pre-commercialization planning.

We anticipate that this collaboration will only grow stronger in the coming months as we plan to coordinate our efforts, both internally and externally in preparation for the filing of the IDE later this year and enrollment of the pivotal clinical trial in 2022.

Finally, I wanted to say a few words about the strength of the Daré brand in the broader women's health ecosystem. We have been and will continue to be active on a number of fronts to seek to continue to drive value into and through our pipeline. What's new about that for this year is that Daré -- the Daré brand has been elevated, and our success both on the development side and the partnering side has translated into real interest from a variety of stakeholders to help us continue to develop and deliver new and differentiated products into the category.

So we are really excited to embark on what we think is the next growth phase for Daré and look forward to keeping you updated as collaboration, exploration and discussions advance.

With that, I will turn the call over to Lisa.

Thank you, John, and thank you all for joining us today. I share Sabrina and John's excitement, and I'm grateful to our entire team for their incredible efforts over the past year. I would now like to summarize Daré's financial results for the year ended December 31, 2020.

Daré's business model is to assemble, advance and monetize a portfolio of novel product candidates in women's health. As a result, our expenses consist of corporate overhead, portfolio acquisition and maintenance costs, and research and development activities to generate the clinical and other data necessary to advance our candidates through regulatory milestones, including approval.

For the year ended December 31, 2020, Daré's general and administrative expenses were approximately $6.5 million. License expenses were approximately $83,000 and research and development, or R&D, expenses were approximately $20.8 million.

In addition to personnel costs of our R&D team, the year's R&D expenses primarily reflect the cost of the DARE-BVFREE Phase III study, activities related to Ovaprene and preclinical development activities for DARE-LARC1. And as you know, the DARE-LARC1 program is supported by our grant from the Bill & Melinda Gates Foundation.

Our comprehensive loss for the year was approximately $27.4 million. During the year, net cash proceeds from financing activities were approximately $25.1 million and represented sales of stock, the exercise of warrants and loan proceeds. Total cash received during the year 2020 was approximately $29.5 million reflecting the financing activities I just described as well as cash from grants, a license fee payment and the Australian R&D incentive cash rebate.

We ended the year with approximately $4.7 million in cash and cash equivalents. Following year-end, so between January 1 and March 29, 2021, Daré received additional cash of approximately $11.5 million, consisting of approximately $11.3 million net of fees from sales of common stock under our ATM program and equity line facility, approximately $50,000 from warrant exercises and approximately $139,000 from grant funding.

Following these activities, as of yesterday, March 29, shares of common stock outstanding were approximately 47.3 million. In late January, Daré's public float exceeded $75 million meaning that we could use our existing Form S-3 shelf registration statement without being subject to the restrictions imposed by the SEC's baby shelf rules.

A public float that exceeds $75 million adds tremendous flexibility and could enable us to explore a variety of financing options that were not available to us in 2019 or 2020. We intend to file a new Form S-3 shelf registration statement with the SEC that will replace our existing shelf registration and which one's effective can be used over the next 3 years, allowing us to explore different financing options over time. As we have done in the past, we will attempt to do so in a manner that protects and enhances shareholder value.

In addition to my comments, there are a few agreements, commitments and arrangements worth highlighting given that they should collectively serve to reduce our cost of development during the coming year 2021 and help us manage our cash resources efficiently.

First, grants. Grants have been an attractive source of nondilutive funding for Daré, and we recognize grant funding in our statement of operations as a rejection to research and development expenses. During 2020, we recognized $3.7 million of grant funding as an offset to our R&D expenses related to Ovaprene, DARE-LARC1 and DARE-FRT1. To date, we have received grant monies from the Eunice Kennedy Shriver National Institute of Child Health and Human Development and the Bill & Melinda Gates Foundation. We will continue to use our existing grants for allowable expenses, and we intend to continue to explore and to apply for additional grant funding in the future.

Second, the terms of our agreements with Health Decisions in Avomeen provide for commitments of certain staff resources as well as expense rate reductions for development activities related to our programs. These arrangements are expected to provide additional time and cost efficiencies in 2021 as well. And finally, as Sabrina had mentioned, under Australia's research and development tax incentive program, we received approximately $192,000 in cash during 2020. And during the first quarter of 2021, we applied for a refundable cash credit of $268,000 based on the eligible expenses incurred in connection with our DARE-HRT1 Phase I clinical study. Currently, the program allows for eligible companies to receive up to 43.5% of their eligible R&D expenses.

We will continue to explore a variety of ways to raise capital to advance our product candidates and to satisfy our working capital needs. Since inception, we have raised cash through the sale of our equity, for M&A transactions, warrant and option exercises, nondilutive grants and license fees. We will endeavor to be creative and opportunistic in seeking the capital we need to build value as we advance our candidates and to be highly efficient in the use of such capital.

A word about COVID-19. We are continuing to monitor the pandemic and its potential impact on many aspects of our business. Due to the many uncertainties surrounding the pandemic, including vaccination rates and efficacy rates and governmental responses, we are unable to predict with any reasonable accuracy, the full financial and business impact on our company at this time.

We encourage investors to review the more detailed discussion of our financials and financial condition, our liquidity and capital resources and our risk factors will be -- which will be filed in the 10-K with the SEC. Now as you know, we typically file our 10-K about half an hour before our earnings call. But as like we'll have it today, the SEC website was down. So keep an eye out, and we will file that 10-K as soon as we can.

I would now like to turn the call over to the operator for Q&A.

(Operator Instructions) Our first question comes from the line of Zegbeh Jallah with ROTH Capital Partners.

A lot of different programs ongoing. So it's really nice to kind of hear what the update is on each of them. So just starting with the first 1 here for DARE-BV1. I was just kind of curious if you were not to get the priority review, would we expect an approval, say, in March?

Yes, great. This is Sabrina. It's a great question. Yes, the priority review allows a 6-month review from the day you file, because this is a 505(b)(2) pathway. So from the day we file. If it's not a priority review, then yes, you would expect that PDUFA to be towards the end of the first quarter.

Perfect. And then in terms of the partnership, I know John mentioned that with a lot of the positives of being able to do remote in virtual as well as a really established market for other products, you guys can be more involved. And so I was just wondering in terms of kind of boosting your cash balance, are you going to prioritize upfront cash? Or that is not a priority? You're just looking for someone that can really handle the launch?

That is really an exceptional question. And so let me try to articulate how we look at it. We really are looking at what is the best partnership for this asset, right? What is the best partnership that is going to maximize the accretive potential to Daré, to our shareholders and frankly, access to women because that is -- that's the beginning and the end of what matters and what's gets you there, right? So what is that best partnership structure. And there are a number of things we're looking to balance in that equation. So we're looking for who is best positioned to commercialize it successfully to the target clinicians, who's best positioned to deliver that message, and who's best positioned to give the product the attention that it deserves in order to achieve its value and success.

And how does our big picture, Daré objectives beyond DARE-BV1 play into that. And so I think what you saw with Ovaprene should give you a sense of how we think about this. We take each asset on its own merit. So as we talked about today with Ovaprene, we felt that it was absolutely critical to that program to have the only company that has, in recent days, built a brand-new contraceptive category, successfully launched into that category and created $1 billion brand as the partner. And so we didn't feel with that program that it made sense for us to have any involvement. With that program, it was the right thing to do to hand it off to Bayer.

As we think about DARE-BV1, for all the reasons I and John communicated on this call, this particular program for a lot of reason, gives us a lot more optionality on how we think about partnerships. And how we think about that trade-off that you mentioned. So just like Ovaprene, there was trade-off. Do you take a lot of money it's upfront? Or do you take more on the back end? And who's going to make the product as big as it can possibly be? And who do you want by your side to do that?

So just like we did with Ovaprene, we'll look at all the possibilities. And as with Ovaprene, we are very fortunate to be advancing programs that people are excited about, that the partnership landscape is excited about, and that gives us optionality. So I know I did not directly answer your question because I can't. But hopefully, I gave you enough perspective that we are absolutely weighing all of that. We're weighing the value of the near-term dollars that could come in under certain deal structures towards less on the front end versus the pros and cons of us having some ability to play a role in this process and how all of that also translates into cash flows.

And just like we talked about with the Bayer deal, where partnerships also are way of funding, nondilutively, how that translated into all that as well. So stay posted. As John mentioned, we will definitely keep people updated. And hopefully, you got some clarity today that as these discussions are progressing and as our regulatory process towards that NDA is progressing, we're finding it definitely is in our best interest to keep the conversations going in parallel and not to rush the process so that we get the best outcome for our shareholders.

And then regarding Ovaprene, thanks for the color on some of the pre-commercial activities that are kind of underway. I was just curious as to what might be driving the timing of the IDE? What has been happening? Just some additional clarity on that. And I think I just had another quick one here. As well in terms of the timing of the next milestone payment because you said that could be helpful for even supporting the development of the rest of your pipeline as well.

2 more great questions. So in terms of the IDE process, so as those of you who have been following Daré for a while, you may remember that we were hopeful to get Ovaprene moving faster, right? At the beginning of the COVID -- before the COVID pandemic in early 2020, we had our sights on getting -- going faster with the Ovaprene program.

With the COVID pandemic and also with the opportunity that actually the regulatory pathway that Ovaprene goes through, which is the CDRH pathway, it's a PMA, it allows things that you don't get to do during the CDRH pathway, which it allows for almost unlimited opportunities to have presubmission meetings with the FDA and talk about things. There was also manufacturing and nonclinical work that we always knew would be required as well. And so in light of all those factors, we recalibrated the time line for the program. While at the same time, balancing what was always one of ours and Bayer's objectives, which was to have some data in 2022, right, as we were kind of looking forward towards the regulatory process.

And so what we've been doing over this period is some of that nonclinical work, just the studies that are required for any kind of regulatory filing in terms of different safety, talks, all that stuff. It's a little bit different when you're going through the PMA process than an NDA. But nonetheless, that -- those types of activities, manufacturing activities, as I mentioned, we've spent more time planning the pivotal study.

So we've used the luxury of not wanting to start this particular trial right in the midst of the pandemic just because it's a contraceptive study, and we have heard from all of our advisers that contraceptive studies are particularly -- have been particularly challenging during COVID environment and our very close collaborators at NIH who had funded the pre-pivotal study had guided that they had actually stopped a number of their studies.

So for all those reasons, we focused on other things. So that is what's driving it, the time line and looking at getting that filing in the end of this year. And then to your question of the readout in 2022 and how that aligns with the milestone payment from Bayer, which is really, I think what you're asking, the $20 million milestone payment for the pivotal study. As I mentioned in my comments, part of our discussions with the FDA that will not be able to be finalized until the IDE is cleared is finalizing alignment on the duration of the pivotal studies. 6, 12 months, what kind of data exactly is required. Hormone-free products have typically been -- devices have been 6 months, but monthly vaginal contraceptive products have been 12 months. So this is a discussion with the FDA on duration.

We know those from contraceptive products that clinical outcomes at 6 months are very predictive of what you're going to see at 12 months. They're either going to be the same at 12 months or even slightly potentially better at 12 months. Contraceptive rates don't go down between 6 and 12 months. So we've aligned that whatever the ultimate package is that needs to be submitted to the FDA, we -- as long as we start the study next year, we will be in a position to read out 6-month contraceptive data by the end of 2022.

Whether or not that triggers the milestone payment of the contract is going to depend on what the ultimate required pivotal study is. What the final pivotal study is, whether it's 6 or 12 months because that payment is due based on a certain time frame. We haven't disclosed all the details redacted in the confidential treatment quest in the filing that's with the SEC on the contract, but it's payable on a certain time after completion of the study. So if the 6-month contraceptive effect is not the completion, if that completion is not right there in 2022, but is in 2023, that's when that timing would happen.

Thank for additional details, Sabrina. And then just one last one for me on the HRT data coming out in the second quarter. I just wanted to get some more details on what are you hoping to see from the data? How should we interpret the data when it does come out and then perhaps maybe even put in the context of how the readout could put you in a good position for subsequent next step?

Yes. And then I'll let move on to the next question in the queue after this one. You've had awesome questions. So I'm excited to get to answer these. On HRT1, to your point, so the data is going to come in the second quarter. And it's Phase I, right? So we're really looking at PK data. We're looking at drug release data over this 28-day period and to see that we've met our objectives. As you may recall, this work has already been done in sheep. Sheep are a great model for vaginal ring technologies because you can use full form factor for humans vaginal ring in the sheep.

So we've already demonstrated this in sheep. So this is an opportunity to do this now in women, obviously, importantly. And also to similar to what was done in sheep, see if there's any adverse events vaginally that are unexpected. So those are really what we're going to look for. We're going to look at confirmation of that same nice PK data that we saw on the sheep, and we're going to look for both of the 2 actives, the progesterone and the estradiol. And then we're also going to look if there's any vaginal effects.

And in terms of why it's also interesting for the FRT1 program, which is the progesterone program where we have the NIH funding up to $2.3 million to support the Phase I is because it's the same progesterone, and we are looking in the HRT at some of the same doses, not all the doses, but some of the same doses that we would consider for the progesterone ring. So it's actually kind of a nice early peak at what those PK data might look like. So it also helps us plan for that Phase I where we're collaborating with the NIH for FRT1. And then obviously, next steps would be for the HRT1 program to progress it into Phase II, which once we have the Phase I data, we can decide how we want to proceed with that program.

Our next question comes from the line of Jason McCarthy with Maxim Group.

This is Joanne Lee on the call for Jason McCarthy. Congratulations on your progress in the quarter. For -- my first question, I guess, is regarding DARE-BV1. We all saw the great data you put out in the fourth quarter for the BV1 asset, which was in line with the previous results announced earlier in the study. I understand NDA submission is planned for Q2. I was just wondering if there's been any recent discussions with the FDA and what were some of the responses you heard? Or -- and if not, do you guys plan on having a sort of a pre-NDA meeting with the FDA? We're obviously looking forward to this submission and announcement of a PDUFA date.

Yes, absolutely. So we had guided previously, and thanks for the reminder because I neglected to mention on today's call, and I probably should have. We had guided previously that we would definitely have pre-NDA discussions with the FDA. Hopefully, you've gathered from even some of my Ovaprene comments that we like to take advantage of opportunities to engage with the FDA. We've done it a lot on our Ovaprene program and our Sildenafil program and absolutely, similarly, on DARE-BV1. We find those pre-NDA discussions -- well, any of the meetings, test meetings that we have with the FDA, but pre-NDA discussions are obviously a really helpful way to do everything a sponsor can to mitigate risk with your submission, right? To make sure that anything that you have questions about, you have an opportunity to ask them and then you can take the FDA's guidance and suggestions and advice into consideration as you prepare the NDA.

So yes, that is something that we do as a company. And we never disclose the exact timing of those events and exactly where we are in that process. But absolutely, pre-NDA communication with the FDA is a critical and important part of our NDA filing strategy.

Great. That was helpful. So there's been a lot of exciting activities surrounding the BV1 asset, but sort of shifting focus to the [FACB] program. It was nice to hear that the Phase IIb study initiated earlier this year. Assuming the results at the end of this year are positive, could you briefly just walk us through what are some of the future steps of the company following completion of this current study to get the Sildenafil Cream onto the market?

Yes. And thank you for asking about that product because I hate to use the word excited when I'm talking about that product, but there's really no better way to describe it. Like, we have been very excited about starting the study. This was another one that we had -- really had hoped to enable to start last year. And we just felt that last year was not the right year with all the uncertainties to start this trial. So we were chomping it a bit to get this study going because it is such an interesting program. It's such a significant unmet need.

We had reached the alignment with the FDA on the primary endpoint. And we announced that at the end of 2019. So this is definitely something we are looking forward to getting going. So we're very excited. And what you may -- those of you who are involved at that time may recall that part of our discussions with the FDA to align on the Phase IIb design and the endpoint was to really start laying the foundation. To your question, of what does the entire program look like? What does a Phase III look like? What are the expectations? Because their guidance document, which is out there, there's a 2016 guidance document, it leaves a lot kind of open to the sponsor and open to the sponsor to discuss with the FDA.

So in terms of what we expect next. So this Phase IIb is designed to use as a primary endpoint, what came out of our content validity work as likely the best primary endpoint to take forward into Phase III. But part of the alignment with the FDA was that this study would include a number of exploratory -- secondary and exploratory endpoints that also looked very good in our content validity work. So an important aspect of the Phase IIb is picking. What is the right endpoint? It may be the one we picked as primary. It may be a different one to take forward into the Phase III program.

So that really is an important consideration in the Phase IIb. And in terms of what the Phase III will look like then, the guidance document with the FDA does currently stipulate 24 weeks as duration versus 12 weeks that we have in the Phase IIb. It's not clear whether that will continue to be the standard for female sexual arousal disorder. That was really designed around hypoactive desire disorder, which is a CNS condition. So that is certainly going to be an area of discussion. But right now, the guidance says 24-week study for Phase III. And we have already discussed with the FDA that we would need 2 Phase III. So while this is a 505(b)(2) program because we're leveraging the safety of sildenafil, it's oral sildenafil in man for different indications, and this is vaginal administration. So the expectation will be to Phase III trials. So after the Phase IIb, hoping for success, the next step would be to have that end of Phase II meeting with the FDA and align on the Phase III based on that, and then get going.

Our next question comes from the line of Douglas Tsao with H.C. Wainwright.

I'm just curious with the hormone replacement therapy products going into Phase I., when we look at your portfolio, you've sort of taken different approaches in terms of when you want to partner assets. Have you given sort of initial thought when or how far along in terms of development you would want to take those?

Thank you for asking that question because John kind of touched on it in some of his comments, where he talked about the fact that we're kind of always in discussions, right, with companies, and that very much is true. So as he mentioned, we are in active discussions kind of at all times across our portfolio as we should be, right? That's our business. We partner on the front end, and we create partnership opportunities in the back end too and everywhere in between, to your question, so we do.

And it really depends on the program, and it depends on kind of the appetite for investment in development. So one of the reasons that we were able to form Daré, and we were able to assemble the exciting portfolio that we assembled as quickly as we did and under such attractive terms as we did, is because the market right now is fragmented. There's a lot of innovation out there. There's -- as we are doing a lot of opportunities to have first in category products, while still leveraging the 505(b)(2) pathway, just by being super creative and how you're delivering them for her, so you can really make it more convenient. Make it more convenient and improve outcomes, and that matters in these indications that are not life-threatening, but are very much life-altering.

And there's commercial entities, and we've been so excited to watch the news on Organon and Merck over the last couple of weeks, and there's more of -- nice to see more of that happening. But there hasn't been as much commitment to invest in development in women's health. So Doug, it's definitely something that we are constantly exploring with potential collaborators in the U.S. and outside of the U.S. and when it makes sense for a particular program, and we think it makes sense for our shareholders, we will absolutely take advantage of those opportunities.

And just as a follow-up to that question. I mean, so far, partnership activity has been sort of on a program by program basis for your company. And when I look at you, there are certain things that sort of could fit in different buckets. And have you ever engaged in multi-product collaborations, partnership discussions? Just because I think there's some -- maybe a little bit earlier stage development that could sort of fit into that bucket.

We have all conversations. Absolutely. No, absolutely. We explore all kinds of partnering opportunities, and we're very active in that all the time. It's what we need to be doing, and it's what we do.

And we're very proud of our portfolio, by the way. I mean, we're able to have those kind of conversations because we have, in our belief, simple, like a premier portfolio of women's health development stage assets. So -- and they are different, like you said, so it does facilitate all kinds of different conversations.

There are no further questions. I will now turn the call back to Mr. Sabrina Martucci Johnson for closing remarks.

Well, thank you all for taking the time this afternoon to hear our update and all the great questions and our chance to share everything that transpired during 2021 in spite of the pandemic and our commitment to our company goals of improving options and outcomes for women and driving value for all of our Daré stakeholders under any operating environment.

So we are grateful to our exemplary team as Lisa mentioned, and shareholder support, frankly, that made our 2020 achievements possible. And as we look ahead, our 2021 plans demonstrate a future of our business model that is core to its value-driving potential. And Doug in his questions kind of touched on that, which is mainly the variety of our programs and the diversity of our women's health indications and the development stages of our programs, and that really enables us to direct our resources and investment across the portfolio in ways that can advance the programs against numerous milestones simultaneously in a time and capital-efficient manner. And so -- and we've demonstrated that even in a challenging environment. And so we look forward to keeping you updated on our progress against the key 2021 objectives that we discussed today across 5 of our different clinical stage programs and indications this year.

So thank you so much for your time today.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.