Jaguar Health Inc (JAGX) 2022 Q2 法說會逐字稿

Ladies and gentlemen, please stand by. Before turning the call over to management, I'd like to remind you that management may make forward-looking statements relating to such matters as continued growth prospects for the company, uncertainties regarding market acceptance of products, the impact of competitive products and pricing, industry trends and product initiatives, including products in the development stage, which may not achieve scientific objectives or meet stringent regulatory requirements.

Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements. These statements are based on current available information, which management's current assumptions, expectations and projections about future events. While management believes its assumptions, expectations and projections are reasonable in the view of the current available information, you are cautioned not to place undue reliance on these forward-looking statements.

The company's actual results may differ materially from those discussed during this webcast for a variety of reasons, including those described in the forward-looking statements and Risk Factors section of the company's Form 10-K for the year 2021, which was filed March 11, 2022, and its other filings with the SEC, which are available on the Investor Relations section of Jaguar's website. Except as required by law, Jaguar undertakes no obligation to update or revise any forward-looking statements contained in this presentation to reflect new information, future events or otherwise.

Additionally, please note that the company supplements its condensed consolidated financial statements presented on a GAAP basis by providing gross sales, non-GAAP EBITDA and non-GAAP recurring EBITDA. Jaguar believes that the disclosure items of these non-GAAP measures provide investors with additional information that reflects the basis upon which the company's management assesses and operates the business. These non-GAAP financial measures should not be viewed in isolation or as a substitute for GAAP net sales and GAAP net loss and are not subject or substitutes for -- or superior to measure financial performance in the conformity with GAAP. Today's conference is being recorded.

At this time, it is my pleasure to turn the call over to Lisa Conte, Jaguar Health's Founder, President and Chief Executive Officer. The floor is yours, Lisa.

Thank you. That's quite a useful to start with. Welcome, all. As you just heard, my name is Lisa Conte, and I am the founder, President and CEO of Jaguar Health, and our wholly owned subsidiary in the United States, Napo Pharmaceuticals. I am also Chairman of the Board of Napo Therapeutics, the corporation we established in Milan, Italy last year to which we granted an exclusive license to crofelemer in Europe, And I'll be speaking about that more later. But I'm going to begin today with the key topline results for the second quarter of 2022.

The prescription product net revenue of $2.9 million, representing an approximate 12% increase over Q1 2022, a quarter-over-quarter calculation, and an approximate 644% increase over Q2 last year 2021, a year-over-year calculation. This is the fourth consecutive quarter of growth in Mytesi net revenue, and we are quite pleased with the growth trajectory of our current prescription drug business. And as you'll hear, quite excited about the late-stage pipeline opportunities that we feel will be transformative in the value creation and value recognition for all our stakeholders, including patients and shareholders.

I'll continue with a few brief updates and then Carol Lizak, Jaguar's Chief Financial Officer, will provide a recap of the key financial results for the second quarter of 2022. After Carol speaks, we will continue with Ian Wendt, Jaguar's Chief Commercial Officer. Ian will speak to updates on Mytesi-related commercial initiatives to continue to educate and serve the HIV community, the activities that will serve future pipeline indications for crofelemer and about ongoing commercial efforts underway for Canalevia-CA1, our prescription drug to the treatment of chemotherapy-induced diarrhea, which I'll refer to as CID, chemotherapy-induced diarrhea in dogs that has been conditionally approved by the FDA and became commercially available to veterinarians in the United States to provide comfort and relief to their canine patients at the end of April 2022. This is the first quarter that we are reporting sales for Canalevia-CA1, which is very exciting and important for those patients.

As a reminder, our commercialized human drug product is named Mytesi, the generic name is crofelemer. It is a first-in-class antisecretory agent approved initially for the specialty indication of the symptomatic release of noninfectious diarrhea in adult patients with HIV/AIDS on antiretroviral therapy. As the term specialty implies, this is a relatively small, important, the relatively small market. This indication was fast tracked by the FDA, and that's why it's the first approved indication for crofelemer. What is really powerful about crofelemer is that this is a pipeline within a product, and what I'm going to focus on today are the 2 late-stage clinical milestones we have, but we feel are potentially transformative initiatives for the company to take crofelemer from a pipeline opportunity to tangible revenue-generating patient benefiting product indications.

Interestingly, Canalevia-CA1 is conditionally approved by the Center of Veterinary Medicine of the FDA for chemotherapy-induced diarrhea in dogs. The 2 human follow-on indications we are focused on are cancer therapy-related diarrhea in the U.S. and through Napo Therapeutics, which I will refer to as NapoCares, team NapoCares' rare disease business model, the orphan indication of short bowel syndrome in Europe. Each of these indications has a major clinical event plans to take place within the next approximate 6 to 12 months. So first, what exactly are these indications? Let's talk about cancer therapy-related diarrhea.

It's estimated that up to 80% of chemotherapy patients experience diarrhea. Managing diarrhea has the potential to impact the outcome of cancer therapy as approximately 40% of patients go off their life-saving cancer therapy or move to or even start with a subtherapeutic dose of their chemotherapy due to diarrhea. This is in addition to the impact on patient comfort, dignity and the cost to the health care system from immense dehydration and potential infection, a point quite important for health care reimbursement.

Enrollment is continuing for the on-target study, our pivotal Phase III trial of crofelemer for cancer therapy-related diarrhea in humans. We're aiming to complete enrollment with a total of 256 patients by the first half of 2023, this is a prophylaxis study, which tells you a lot about how important it is to get in front of the impact of diarrhea during cancer treatment. CTD is not regarding variety diarrhea, this is a diarrhea that can put patients in the hospital not only for dehydration, also for electrolyte imbalance that can have cardiovascular effects and can cause organ shutdown and has even resulted in death in some patients who have been in cancer agent manufacturers clinical trials.

With the new targeted cancer therapies that are used chronically, both in metastatic and in curative cancer situation, therapies are used for months or years until the patient passes on. Sometimes the incidence of diarrhea is as high as 100%. Recent reports show that diarrhea occurs 50% to 100% of the time with different targeted agents. To project the potential market opportunity for CTD, since crofelemer is the first drug candidate that's being evaluated to be approved for this indication, we're looking at an analogous market.

Chemotherapy-induced nausea and vomiting, referred to as CINV. This market is projected to be close to a $3 billion global market this year, according to a report published by Allied Market Research. CINV agents are typically only used for the first 3 days in traditional cytotoxic chemotherapy. With CTD, cancer therapy-related diarrhea, we are talking about diarrhea that can persist on a chronic basis for months and for years.

The successful completion of our on-target pivotal trial will result in a supplemental new drug application filing for the same formulation as the currently commercialized crofelemer or Mytesi. Mytesi is, of course, already approved for a chronic use in people living with HIV/AIDS and has a full FDA compliant supply chain in place from the rainforest to essentially every one of our specialty pharmacy distribution network across the United States.

As a reminder, safety and manufacturing are the 2 most common reasons that new drug applications fail. These activities are completed for Mytesi from a regulatory perspective. Hence, we spent much care and engaged in the extensive communication with the FDA in the design and implementation of this final clinical and regulatory steps to report bringing crofelemer to cancer patients suffering with diarrhea.

I'll now discuss our second prioritized pipeline indication for crofelemer, short bowel syndrome, referred to as SBS. SBS is a catastrophic situation for patients. It is a classic rare disease affecting an estimated 40,000 people around the world. The normal gut is 20 to 25 feet in length. In SBS, the patient's gut could be less than 5 feet for congenital reasons or as a result of surgery due to cancer, inflammation or an accident. As you can imagine, with a very short cut to put us in. Whatever goes in comes right out.

The bottom line is, there's not enough intestinal real estate. There's not enough surface area for the SBS patients to absorb what I'll call the nutrient supplies, carbohydrate, protein stats, vitamins and minerals. So what happens is these patients often end up on parenteral nutrition, the intravenous feeding of liquid nutrients for up to 20 hours a day, 7 days a week. Obviously, a significant negative impact on the patient's quality of life, and there are multiple negative health effects, inceptions and complications associated with parenteral nutrition. Parenteral nutrition is also expensive, costing hundreds of thousands to $1 million a year to manage an individual patient, including the myriad of complications with high morbidity and mortality.

The global SBS market is projected to reach $5 billion by 2027, according to reports from Vision Research reports. A low parenteral nutrition is considered the standard of care. There is a good product approved for SBS called teduglutide, which is a GLP-2 analog. It is essentially a growth hormone intended to grow the real estate of the gut slightly so that there is a little bit more time for absorption of the nutrients of life. It's administered as an injection and is estimated to be utilized in less than 10% of the SBS patient population.

Teduglutide has a range of side effects and cannot be used chronically. It has been shown to increase cardiovascular risk, especially the risk of developing congestive heart failure and its use has been shown to increase absorption and metabolism of concomitant medications. The primary endpoint in the trial for the approval of teduglutide is the reduction in the time required to be on parental nutrition by about 20%.

What we're looking to do with crofelemer is to reduce the time on parenteral nutrition as the primary end point as well and provide better stool formation and the quality of life measurement. With crofelemer strong safety profile, we expect patients to be able to tolerate and benefits from crofelemer chronically.

SBS development of crofelemer is being pursued through the company we established in Europe last year called a Napo Therapeutics, NapoThera, which holds an exclusive license to crofelemer for Europe from Jaguar. It's a classic license agreement incorporating upfront payment, milestones and royalties. The reason for basing this new company in Europe is because the EMA, the European Medicines Agency, which is the FDA of Europe, has an early access program for orphan indications like SBS because of the impact on patients with published preprocessed data patients in specific major markets in Europe can get access to a product through an early access program, while full approval is being pursued. And for those patients, the product is reimbursed, and this is not a program that exists in the United States.

We have approved the planned investigator-initiative proof-of-concept trial of crofelemer for SBS, and the third-party investigator is targeting the presentation of results from the study in December of this year 2022 at a Global GI Conference, which will take place in Dubai. With the publication of the results of this proof-of-concept study, NapoThera is aiming to implement the early access program for patient treatment and revenue generation. The timing of this happens to coincide with when we expect to complete our pivotal Phase III trial of crofelemer for cancer therapy-related diarrhea.

Again, a key advantage of the NapoThera efforts to Jaguar is that NapoThera is well over majority owned by Jaguar, providing potential equity accretion value to Jaguar shareholders and stakeholders value, value that we believe is unrecognized at this time. Jaguar also receives the value of any clinical data generated by NapoThera for SBS, and reciprocally, NapoThera received the value and the ability to utilize the CTD, the cancer Phase III data Jaguar is developing. Hence, the parallel complementary and geographically focused development effort of this crofelemer for each of these 2 core pipeline indications, CTD and SBS, are progressing simultaneously and collaboratively, each with their own dedicated focus and extremely experienced and talented team.

So to recap, in approximately 12 months, we expect to have completion of enrollment in our Phase III trial of cancer therapy-related diarrhea called the on-target trial and expect to have published proof-of-concept data in support of an early access program in Europe for SBS, which could bring in meaningful revenues, 2 expected transformative events that are on the near-term horizon.

An additional key milestone for 2022 on the human front is the filing of an investigational new drug IND application with the FDA in the third quarter this year for symptomatic relief of diarrhea from cholera for our NP-300 drug candidate also referred to as lechlemer. Lechlemer is a different chemical collection of proanthocyanidins extracted from croton lechleri tree. which is the same tree from which we get crofelemer, which we believe defines lechlemer as a distinct product from crofelemer under FDA botanical guidance, the guidance upon which crofelemer is approved.

Lechlemer works by the same novel anti-secretory mechanism of action as crofelemer yet has a lower manufacturing cost. In support of this IND, we received comprehensive animal toxicity preclinical services supported by the National Institute of Allergies and Infectious Diseases for 4 preclinical studies. We plan to pursue a tropical disease priority review voucher for lechlemer under the FDA's financial incentive program to develop drugs for tropical diseases such as cholera. Priority review vouchers are transferable and in past transactions that other companies have sold for prices ranging from $67 million to $350 million, and which provides for a potential immediate return on investment upon approval of the product for the symptomatic relief of diarrhea from cholera.

Moving along to the animal health side of our business. As I mentioned, crofelemer is also the active ingredient in Canalevia-CA1, our product for chemotherapy-induced diarrhea in dogs, for which commercial launch activities are ongoing now. The whole cancer situation does is remarkably analogous to the human situation. As with human cancer patients, dogs go off their disease-modifying chemotherapy or move to a subtherapeutic dose approximately 40% of the time due to diarrhea, meaning these dogs cannot complete their therapeutic dose of chemotherapy because of diarrhea.

The comfort of the drug is one of the most important, if not the most important, consideration of the dog owner when deciding whether or not to put their dogs through cancer treatment because, of course, you can't talk to the dog and let them know it's going to be terrible for 3 months. You'll feel awful hanging there, and you have the whole dynamic of the quality of life of the households of the dogs that may have lost control on the road or the bed in the household. There are a couple of really important factors in the dog market. The incidence of cancer in drugs is reported to be 5x what we see in humans, an estimated $9 million dogs were acquired by U.S. households during the pandemic, according to the American Pet Products Association, bringing the total number of dogs in the United States to about 108 million, which is roughly 1 dog for every 3 humans in the country. And unfortunately, about 50% of dogs over the age of 10 are going to be diagnosed with cancer at some point.

The U.S. veterinary market operates in a pay out-of-pocket model. From a financial perspective, this dynamic allows us to have great predictability between gross revenue and net revenue and a higher overall gross-to-net ratio, which is a much different situation than we have on the human side of the business in the United States.

Education and promotion about the devastating impact of cancer therapy-related diarrhea builds awareness about the importance of managing diarrhea so that the practitioners can take the best care of the patients regardless whether the patient is a human or a dog.

We launched the first-ever canine cancer registry in the United States in May in New York. Believe it or not, a registry did not previously exist in the United States for canine cancer. It was an event the launch of this with great fanfare, a great PR event, a great Investor Relations event and great educational events. This project is called the Jaguar Health Canine Cancer Take C.H.A.R.G.E initiative, that's an acronym. Our goal in establishing the first U.S. national canine cancer industry and cancer care index is to assess the prevalence and incidence of cancer in dogs, and most importantly, how you can keep the dog in the entire family situation comfortable during what is often a very siloed and tragic event for our family and help create a community of support with the information that comes from the registry.

On August 10, Gallup, the leading national polling organization published an article providing their analysis of results from Take Charge Canine Cancer, the first-ever nationally representative survey of U.S. dog owners experience with the disease. The data from the survey indicates that of the 67% of Americans, 67% who have had at least 1 dog in the past 10 years, nearly 1 in 5, which is about 30 million people have had at least one of their dogs experienced cancer.

In addition to CID in dogs, crofelemer is expected to be conditionally approved for the treatment of exercise-induced diarrhea in dogs in the next 6 months. With the Take C.H.A.R.G.E. initiative underway, the commercial launch of Canalevia-CA1 continuing the potential additional dog indication for crofelemer. This is Jaguar's year of the dog. In the next 12 months, there is the potential for a lot of other views on both the canine and human front. We have global rights for crofelemer for all indications.

On the business development front in June, as announced, we entered an exclusive license and services agreement with Ontario, Canada-based SynWorld Technologies Corporation, SynWorld, for the treatment of diarrhea and dogs in the China market with Canalevia. The agreement is structured to bring license fees of $5 million and up to $5 million in unregistered equity infusion to Jaguar over the next approximate 24 months. As additional consideration for the license, Jaguar is entitled to receive 60% of any products from sales of the product in China. And if Jaguar reimburses SynWorld for the direct expense of obtaining regulatory approval in China, the profit sharing will be 80% and 20% respectively, for Jaguar in SynWorld.

We also entered an agreement at the end of the first quarter of 2022 this year with Quadri Pharma that grants Quadri exclusive promotional commercialization and distribution rights for specified human indications of fulfillment in Bahrain, Kuwait, Qatar, Saudi Arabia and the UAE and Oman. This is a revenue-sharing relationship for HIV-related diarrhea, and the agreement terms provide Jaguar with an increase in the revenue sharing percentage for sales in these countries of newly approved indications, which will apply to the CTD and potentially, inflammatory bowel disease indications for crofelemer, of course, upon marketing approval.

And in June 2022 this year, Jaguar and Filament Health signed a letter of intent to enter a collaboration agreement to develop botanical prescription drugs for specific psychoactive target indications in the United States. The goal of the collaboration is to extend the botanical drug development skill sets of both companies in order to develop pharmaceutical grade, plant-based, standardized drug candidates and then partner with potential future licensees regarding their responsibility for the more expensive, development and commercialization of these novel drugs.

Jaguar and Entheogen Therapeutics Initiative, ETI, aims to discover and develop groundbreaking novel natural medicines derived in psychedelic and psychoactive plants for the treatment and potential cure of mood disorders, neurodegenerative diseases, addiction, and mental health disorders beyond the current agents being pursued by multiple third-parties, including psilocybin, MDMA, and ketamine and 4 others.

What we're focusing on are the next generation of these compounds. This effort has mobilized the Jaguar assets, a library of 2,300 plants and 3,500 plant extracts that was generated over 3 decades. I believe you can expect to see additional business development deals because we are committed. It is our cause to bring crofelemer and all our potential products to all patient populations in need in geographies around the world.

Lastly, I'd like to let all of you participating today to know that we will have a brief Q&A segment as we always do at the end of this webcast to address questions, if there are any. (Operator Instructions)

The URL for Jaguar's website is jaguar.health. We'll now move along to key financial results for the first quarter of 2022. Carol, I'll turn it over to you, please.

Thank you, Lisa, and thank you all for joining our webcast today. I'll begin my review of our financials for the second quarter of 2022. Mytesi net revenues during the second quarter of 2022 was approximately $2.8 million and about $2.6 million in the first quarter of 2022, an increase of approximately $200,000 or 10% quarter-over-quarter, and an increase of 644% over Mytesi net revenue in the second quarter of 2021, which totaled about $400,000.

Mytesi prescription volume, the metric the company believes to be the best indicator of growth in patient demand, increased 8.2% in the second quarter of 2022. Over the second -- the first quarter of 2022, prescription volume differs from invoiced sales volume, which reflects, among other factors, varying buying patterns among specialty pharmacies in the closed network as they manage their inventory levels. Mytesi gross revenue, a non-GAAP measure, was approximately $3.7 million in the second quarter of 2022 and $3.4 million in the first quarter of 2022, representing an increase of approximately $300,000 or 9% quarter-over-quarter, and a decrease of approximately 24% over Mytesi gross revenue in the second quarter of 2021, which totaled approximately $4.9 million.

As Lisa mentioned, Canalevia-CA1 became commercially available to veterinarians across the U.S. at the end of April 2022. Canalevia-CA1 net and gross revenue during the second quarter of 2022 were $87,400. Non-GAAP EBITDA for the second quarter of 2022 and the second quarter of 2021 was a net loss of $5.4 million and $10.8 million, respectively.

For the second quarter of 2022, the loss from operations was $6.3 million compared to a loss of $11.6 million in the second quarter of 2021, a decrease of $5.3 million quarter-over-quarter. For the second quarter of 2022, the net loss attributable to common shareholders was approximately $9.4 million compared to a net loss of $14.1 million in the second quarter of 2021, a decrease of approximately $4.7 million quarter-over-quarter. And in addition to the loss from operations, interest expense increased by $500,000 from $2 million in the 3 months ended June 30, 2021, to $2.5 million for the same period in 2022. That's primarily due to the interest from the royalty and note agreements.

A change in fair value of financial instruments and hybrid instruments designated at fair value options losses increased $1.2 million from a loss of $500,000 in the 3 months ended June 30, 2021, to a gain of $700,000 for the same period in 2022. Other expense increased by $1.1 million from $200,000 in the 3 months ended June 30, 2021, to $1.1 million for the same period in 2022 due to the foreign currency transactions.

That concludes my recap of high-level financials for the second quarter of 2022. I will now hand the discussion over to Ian Wendt, our Chief Commercial Officer.

Thank you, Carol, and good morning to all. As Carol stated, Mytesi total prescription volume, the metric we believe to be the best indicator of patient demand, increased 8.2% in the second quarter of 2022 over the first quarter of 2022. As previously announced, the transition we completed this past January to a closed network of specialty pharmacies resulted in a meaningful reduction in Mytesi distribution costs as well as a higher average net price. In fact, I'm very pleased to report that we significantly outperformed the industry gross to net average in the second quarter of 2022 as we did in both of the 2 previous quarters for sales of our human prescription product.

This improvement in our GTN was largely as a result of the efficiencies realized by the transition to a closed network of specialty pharmacies. And as Lisa mentioned, Q2 2022 is the fourth consecutive quarter of growth in Mytesi net revenue, which we're also very pleased about. A key component of the company's market access strategy, our initiative to transition to a closed network of specialty pharmacies is intended to help remove access barriers for patients prescribed Mytesi and include services such as a higher level of support for prior authorizations, appeals, adherence counseling and home delivery options.

While patients often visit retail pharmacies for short-term or uncomplicated medical needs, specialty pharmacies focused primarily on serving patients with complex and chronic medical conditions like HIV.

Importantly, this transition allowed us to begin utilizing sales and prescription data directly provided by our network of specialty pharmacies to more accurately track prescription volume and the patient journey rather than relying on a third-party provider of estimate the data for these important performance metrics. This also assists in the preparation of our U.S. commercial distribution network for potential future indication expansion of crofelemer to other populations of patients with complex medical needs such as CTD, inflammatory bowel disease, and SBS.

I'm also pleased to report that our innovative recently launched programs that further support patients connecting to care and medication access services are continuing as planned. The first program is our telehealth initiative, which went live in May that enables patients seeking help with their HIV-related diarrhea to be linked immediately to a provider for assistance with their medical needs. This new capability prevents patients from having to wait until their next scheduled doctor visit to get help with what is an urgent problem.

Our second recently launched program delivers digital Mytesi and disease state education directly into a provider's EHR, that's Electronic Health Record system so that they learn about Mytesi at the moment they are seeing their HIV patients. This technology allows us to intelligently deliver ads to a provider based on the profile of the patient they are seeing in their exam room. And this is strictly a one-way communication, we did not receive any protected health information.

Both of these programs are designed to drive incremental brand awareness among prescribers who have not written Mytesi previously and among patients who have not been able to receive immediate care for their HIV-related diarrhea.

Turning to the Animal Health side of our business. We are thrilled, as Lisa mentioned, that Canalevia-CA1, our FDA conditionally approved treatment for chemotherapy-induced diarrhea, or CID, in dogs became commercially available to veterinarians across the United States at the end of April 2022. Since that time, we have succeeded in pushing Canalevia-CA1 into broad distribution with the leading veterinary distribution centers. We see new clinics ordering Canalevia-CA1 each week and now have multiple clinics that have placed repeat orders. This is a great indicator that veterinarians are seeing the clinical benefits of our product among their patients.

Canalevia-CA1 is an important prescription drug introduction for the veterinary community and the thousands of dogs experiencing CID. As Lisa commented, dogs as with humans may discontinue their chemotherapy treatment, approximately 40% of the time due to diarrhea. Canalevia-CA1 can help support the comfort and quality of life of dogs while being treated with chemotherapy, which may help them remain compliant with their life-saving treatment. The reception of Canalevia-CA1 among general practice vets and veterinary oncologists who have learned about the product has been extremely positive.

Commercial launch activities for Canalevia-CA1 remain underway. The product was the focus of Jaguar Animal Health's exhibit booth at the April Veterinary Cancer Society Midyear Conference in Puerto Vallarta, Mexico. Company also held a well-attended dinner event for Veterinary Oncologists about CID in dogs at this conference. We exhibited at the 2022 American College of Veterinary Internal Medicine, ACVIM, Forum in Austin in June, and we'll be exhibiting at the upcoming International Veterinary Emergency and Critical Care Symposium in San Antonio, Texas, in September, and at the Veterinary Cancer Society Annual Conference in Norfolk, Virginia in October.

We're also developing a CID educational content that will be eligible for continuing education credits for veterinarians to help increase awareness of this important issue. As announced, we expect Canalevia could additionally receive FDA conditional approval under the name Canalevia-CA2 for the treatment of exercise-induced diarrhea, or EID, in dogs in the first quarter of 2023.

That concludes my comments. Thank you all for your time today, and I'll pass the conversation back to Lisa.

Thanks, Ian. Thanks, Carol. We, at Jaguar, Napo and NapoThera are energized about all of our important initiatives underway in 2022 and beyond. I would also like to mention that as we announced this past Friday, Jaguar received formal notice on August 18 that the listing qualification stats of the NASDAQ stock market was granted the company an additional 180-day grace period through February 13, 2023, to regain compliance with the $1 bid price requirement for continued listing on the NASDAQ Capital Markets.

We are pleased to have obtained additional time from NASDAQ to evidence compliance with the bid price requirement. And as we seek to regain compliance with this rule, we are laser focused on our 2 late-stage clinical events in the next approximate 6 to 12 months that we expect to be transformational in terms of value creation and recognition for the company. We did file a preliminary proxy on Friday, August 19, for a special meeting of the shareholders of Jaguar. As noted in the proxy resolutions, we are not seeking a reverse split of the Jaguar shares.

We'll now open the floor for written questions that have come in, and I will move to those now and repeat the question. There aren't a lot, there is a couple here.

One of them was -- is during the past slide presentation, you mentioned that there would be a color about your filing in the first half of the second quarter of 2022. When is the filing of the voucher for cholera going to happen?

So I think that is a bit of a misunderstanding. So the voucher for the cholera program, the tropical disease priority voucher is something that is granted by the FDA upon FDA approval for the topical disease. So in the case, the approval of lechlemer, which it has never been planned for 2022, what has been planned and what will happen is the filing of the IND, which will occur in the third quarter. So that's just around the corner of this year. When the clinical program is completed successfully is when you potentially receive the voucher and then the voucher is transferable, and it could be sold at that time.

As a reminder, cholera as compared to the indications approved and being pursued from crofelemer, cholera is an acute indication. So the clinical trials are in that we had done in the past for cholera with crofelemer with the same mechanism of action of our published is 3 days of treatment.

What are the earnings from Napo specifically?

So in case, again, sometimes it can be confusing with the name, Napo Pharmaceuticals is wholly owned by Jaguar Health. So essentially, they are interchangeable when we say Jaguar Napo. Napo Therapeutics, not Napo Pharmaceuticals, Napo Therapeutics is the private Italian corporation that was established in Italy under an exclusive license to crofelemer from Jaguar, Napo Pharmaceuticals. And it is, as I mentioned, well over a majority owned also by Jaguar. And therefore, we have the equity benefit in that corporation as well as for the license benefit.

And let's see, can you remind us of the primary endpoint in the OnTarget study? And what is the expectation going into data readout in the near term what constitutes a positive readout for the study?

So the study is the label being targeted is for prophylaxis in cancer therapy-related diarrhea. The basket approval for all solid tumors in patients on targeted therapies, these are tyrosine kinase inhibitor, epidermal growth factor receptor antibodies with or without cytotoxic chemotherapy.

Prophylaxis -- and this was actually a suggestion, and there's an insistence from the FDA, which is really a wonderful opportunity for patients to never have to experience the diarrhea and also quite beneficial from a commercial perspective. It's -- primary endpoint is, after 3 months, and it's an area under the curve calculation of the improvement in stool formation or essentially the reduction in diarrhea compared to the placebo.

So it's 266 patients, Mytesi -- literally Mytesi, the same dose, the same formulation, 1:1 compared to placebo. Patient enrollment will be -- is targeted to be completed in the first half of 2023. 3 months, as I mentioned, for the primary endpoint. So in the second half of 2023 is when we would expect to have the readout what constitutes the positive results.

I mean the pharma industry is really remarkable in that it's a single point. It is the p-value on the primary endpoint, and that would allow us, therefore, to expand the indictable indication for Mytesi. And we are already preparing for inventory production for -- towards the end of 2023, beginning of 2024.

Will we pay a dividend?

There's no plans to pay any dividend at this point. When we're a profitable organization as we have our pipeline indications approved, that is something that could be considered.

Are you in negotiations with other strategic partners?

Absolutely. As I mentioned, you can expect to see business development deals going forward, in particular. Again, as I've mentioned, we have discussions going on with the Entheogen Therapeutics Initiative, which is an effort to mobilize and find value from an asset that we created over 3 decades. So 2,300 plants, 3,500 plant extracts, looking at those that could provide potential second-generation psychoactive, psychedelic products that we will partner with a -- and we are seeking partnerships with one of the many well-financed companies that are focused on psychoactive and psychedelic.

As again, as I mentioned, psilocybin and MDMA, ketamine, they're all chasing about the same 7 compounds. What are the next generation, what are the new mechanisms of action we can bring to the table with what we do so well, which is the library, the ethnobotanical firsthand information, the guidance on how to proceed with a product under the clinical guidance, the supply and count on a partner that is focused on regulatory, clinical development, commercialization in these areas as our internal efforts are focused clinically on crofelemer and gastrointestinal indications.

And I've got a complement here. Thank you. And that is all the questions that's all the questions -- so that's all the question. So thank you. I know this was a long call. There's a lot of news, and we appreciate your interest in consideration.

That concludes our webcast for today. Thanks, once again, all of you for joining and your interest in Jaguar, crofelemer, Napo, Napo Therapeutics, and we are going to get back to work because there's a lot to do. Thank you.

Once again, ladies and gentlemen, this does conclude your webcast for today. Thank you for your participation, and you may now disconnect.