Jaguar Health Inc (JAGX) 2023 Q4 法說會逐字稿

Before I turn 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 and products, the impact of competitive products and pricing, industry trends, and productive 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 currently available information and management's current assumptions, expectations, and projections about future events. While management believes its assumptions, expectations, and projections are reasonable in view of currently 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 with this webcast for a variety of reasons, including those described in the Forward-Looking Statements and Risk Factors sections of the company's Form 10-K for the year 2023, which was filed on April 1, 2024, 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 the company supplements its condensed consolidated financial statements presented on a GAAP basis by providing 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 company management assesses and operates the business. These non-GAAP financial measures should be viewed in isolation or as substitutes for GAAP net sales and GAAP net loss, and are not substitute for or superior to measures of financial performance in conformity with GAAP.

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

Thank you for joining our investor webcast for the fourth quarter of 2023. Hello, my name is Lisa Conte. I'm the Founder, President, and CEO of Jaguar Health, and our wholly owned subsidiary, Napo Pharmaceuticals. As usual, I may be using the words Jaguar and Napo interchangeably to refer to our company. I want to thank you for joining this webcast.

Let me start with the burning question I hear from shareholders: the timing of release of results from the OnTarget trial. OnTarget, as a reminder, is our pivotal Phase 3 trial of crofelemer, which is our novel plant-based prescription drug, for the prophylaxis of cancer therapy-related diarrhea in patients with all solid tumors on targeted therapy with or without cytotoxic chemotherapy.

We completed the in-life treatment phase of approximately 280 patients in the fourth quarter of last year 2023, and let me describe a bit of that study. It's a first-of-its-kind patient reported outcome study. And what does that mean? The clinical endpoints are based on real-time patient reported outcomes recorded in a digital app, recorded daily in a digital app. And it was conducted in six different countries.

The databases locked. And what does that mean? The patient-reported outcome data, the primary endpoint data is secure. And we are fully confident in the integrity and the security of the data. And I'm going to repeat that several times. We are fully confident in the integrity and the security of the data.

So why are there still no results reported from the OnTarget trial? As with many small companies and to tell you the truth, even large pharmaceutical companies involved with expansive global pivotal trials, we use several third-party contractors -- for example, for complex -- highly complex statistical programming algorithms and who all must adhere and do adhere to GCP, Good Clinical Practice compliance, Good Clinical Practice quality measures required by the FDA for human clinical trials. These activities are integral components of what we refer to as the statistical analysis plan for OnTarget.

All right. In November 2023, well, we, the company, were still blinded to the results. And what does that mean? That means nobody in the company knows what patients are on placebo or crofelemer. We became aware of an error in the programming from one of our statistical analysis contractors that would be applied the algorithm, that would be applied to the data of the trial. Again, this does not touch on the integrity of the data collection, the algorithm that would be applied to that data.

Since we remain blinded, candidly, it took us some time to process what to do. Could there be more? We are aware we are a small company with high expectations for timing of the key milestone, key milestone being the release of the OnTarget data, a milestone for a Phase 3 trial for a potential supplemental indication for product that's already approved, that this could be transformative with respect to both the company valuation and the patient community in need.

So in order to address the complexity of statistical programming needs, remember there's around 10 different solid tumor types, 24 different targeted therapies, 6 different countries, daily patient-reported outcomes, anywhere from 90 to 180 days, multiple entry day -- entries a day, we have retained a clinically savvy and a very experienced biostatistics and programming expert. And we did this back in 2023 to review and to lead and oversee the statistical programming and the implementation of the analysis plan. He is leading this effort with informed expertise. And what does that mean?

This expert biostatistician also led the analysis of the successful pivotal Phase 3 ADVENT trial, which led to the approval of crofelemer for the current indication for HIV-related diarrhea, the Mytesi trade name product. And therefore, he understands the endpoints in the context of crofelemer's paradigm shifting mechanism of action for normalizing GI function in a chronic situation of a first-of-its-kind clinical trial for this supportive care indication in cancer patients. Our charter to him is to go where he needs to go, working under GCPs, and work with urgency.

We could not and did not put specific time constraints for a process that was unfolding. And that is why we have not been able to reliably issue a precise timeline for the completion of data analysis and result disclosure for the OnTarget trial. Of course, we have been updated. The results are forthcoming. I recognize I am causing frustration in that I cannot reliably provide a specific date. I can reliably assure all of you that the integrity of the process of the data analysis as well as the data itself leading to the clinical trial result disclosure is our first and foremost priority.

Okay. Next, I'd like to speak to our strategic focus, our important strategic focus in the fortitude of our commitment to cancer supportive care. A prominent cancer patient advocate, a person living with metastatic cancer for 15 years speaks to 21 different -- distinct side effects of cancer treatment that she has managed throughout her continuing battle with cancer.

Obviously, there is an abundance of unmet medical need in cancer supportive care. To our mission, what's more important than patient quality of life, dignity, comfort, choice, and the opportunity to be able to maintain adherence to life-saving cancer therapy? That's what we're all about. It's estimated that approximately 80%-plus of cancer survivors have unmet supportive care needs. And many, many, many patients go off or reduce their life-saving cancer therapy, specifically because of these adverse side effects.

And as an example, patients with cancer therapy-related diarrhea CTD, topic near to my heart, have been shown more than 40% of the time to discontinue their chemotherapy or their targeted therapy, their life-saving cancer therapy because of diarrhea, 40% more likely than patients without CTD.

We, at Jaguar, Napo, are evaluating additional commercial opportunities in cancer supportive care to supplement our efforts in CTD. And by the way, CTD is an indication we also refer to as chemotherapy-induced overactive bowel. So do stay tuned to our first further efforts here.

Our participation in elevating patient voice in cancer care is a key initiative in this pursuit. We have established and are just launching digital channels, multiple digital channels devoted to creating community, conversation, exchange, and education jointly with cancer patients.

These will be launched in conjunction with our participation at the Oncology Nursing Society Congress, which takes place in April, April 24 through 28 in Washington, DC, this year; and the American Society of Clinical Oncology, ASCO Annual Meeting, which takes place the beginning of June in Chicago this year.

Nurses, nurse practitioners are key partners in navigating patients' supportive care journey. And our digital channels provide an opportunity for patients to share their stories and will also include a video blog that I host as I, too, became a person living with a cancer diagnosis this past year. It happens and it's happening way too frequently.

At the end of this call, we'll be sharing a video highlighting the company's passion for supportive care as expressed by key personnel from Jaguar. Way too many people are living with cancer or have a loved one living with a cancer diagnosis. The keyword is living.

Our mission is to help patients live with cancer, not just exist. One additional recent event, very exciting recent events solidifying our patient focus is the recent out-license deal we just completed with Gen İlaç, a company called Gen İlaç. I will refer to them as GEN.

GEN is a public Turkish specialty pharmaceutical company with a business model centered on partnering with global innovator pharmaceutical companies like Jaguar to bring therapies to their territories to serve significant unmet medical needs. And I just returned from Turkey this week kicking off the collaboration with GEN's Founder and CEO. His long experience, 34 years in the Turkish market in neighboring countries and his passion for cancer patient supportive care drove this important collaboration at this time prior to the availability of OnTarget results. He also recognizes the value opportunity in Jaguar's upcoming, potentially transformative value event, as GEN has invested $2 million and a 70% premium to where the stock is trading.

GEN is also a market leader in rare disease indications. As part of the recent license agreement, GEN also has licensed rights to crofelemer for the rare disease orphan indications of intestinal failure with short bowel syndrome, SBS; and microvillus inclusion disease, MVID.

They have -- GEN has sophisticated manufacturing capabilities, and we'll be working with them on our novel, highly concentrated liquid formulation of crofelemer for these orphan indications, which is a distinct product from Mytesi, which is a pill formulation of crofelemer.

Jaguar is currently supporting five different clinical efforts in intestinal failure across three different continents, intestinal failure with SBS and MVID, with strong leadership and participation coming from our Italian subsidiary, Napo Therapeutics.

Let me tell you about Napa therapeutics. Dr. Massimo Radaelli is a Board member of Napo Thera, as well as I am. And I'm very pleased to announce we have appointed Massimo to the role of President of Jaguar International. Massimo is a European pharmaceutical industry leader, a sophisticated leader and entrepreneur with more than 35 years experience in the sector and, in particular, in the innovation of therapies developed to treat rare and orphan diseases.

He holds a PhD in clinical pharmacology. He is remarkable. He was just with me on this recent trip and other trips to Turkey to make the GEN deal happen. He lives and breathes the pharma industry. His relationships at the key leadership of many pharmaceutical companies, for example, was instrumental in bringing about the introduction to and the recent agreement with GEN.

His focus will center on supporting and driving our efforts to further develop and expand Jaguar's business outside of the United States. In a few minutes, we'll play a short video from Massimo in which he discusses why he has decided to expand his role in Jaguar, the value that he sees in participating with Jaguar. And we are so thrilled and grateful he is doing so.

So in summary, the cancer treatment landscape has radically changed and for the better. We're in the age of targeted therapies. Targeted therapies are allowing people to live longer and are often taken chronically for years -- in some case, decades. However, the advent of targeted therapies has also led to a rise in treatment-related side effects and unmet supportive care needs.

As a company with a deep dedication to patient supportive care, we are increasing our focus on cancer supportive care through the process of bringing crofelemer from a tree in the rainforest to pharmacies -- a product in pharmacies across the United States -- for supportive care indication for people living with HIV AIDS, Jaguar has gained a great deal of experience about educating health care professionals and patients and payers about the paradigm shifting mechanism of action.

While the HIV market supportive care may be a stagnating market and in some ways, thankfully, due to the innovations in HIV treatment, supportive care needs and cancer are increasing. We acknowledge the rigors of both short term and perpetual treatment and do not believe any cancer therapy-related side effect whether it's extreme fatigue, debilitating diarrhea, hair loss, chronic neuropathy, chronic pain or any of the other 21 side effects should ever be viewed as acceptable or tolerable. There are no tolerable toxicities.

And now we will hear from Massimo Radaelli; and then from our CFO, Carol Lizak, regarding the financial highlights from the fourth quarter of 2023, and then I will be back. Thank you.

Today is a very humbling day for me. It reminds me of my first day in the pharmaceutical industry many years ago, more than 35 years ago. Like many of you, I had a choice about where to come to work. And I came here because I believe Jaguar Health and the Napo Therapeutics were the best opportunities for me. I am sure we are doing things with our research, our programs, our products, our values, and our experience to ultimately make the world a better place for our patients and for their families.

I knew talking with our Chief Executive Officer, Lisa, there was no better company to join if I wanted to make a difference for the quality of life of our patients with the same inspiration that continues to drive me today. This is an incredible honor for me to serve this company and to devote with my pharmacological and the clinical experience additional time to the company, focusing on new therapeutic solution, in particular, the orphan drugs products and innovative specialty pharma products and technology. And together with them with my international -- commercial experience to expand the geographic presence of Jaguar Health around the world.

We must be hungry to do more always. I'm always very hungry to do more. I learned in my long experience that the pharma and biotech companies do not respect tradition. The companies, they respect only innovation, real innovation.

We'll now hear from -- thank you, Massimo, for the amazing statements and amazing contribution. Again, we are so grateful to have him involved already making very, very important difference in getting products to patients -- [by the Napo there] -- in fulfilling the mission of Jaguar and crofelemer.

Carol, I'll now turn it over to you to talk about the financial highlights from the fourth quarter and in association with our K filing today.

Well, thank you, Lisa, and thank you all for joining our webcast today. I'll begin my review of our financials for the fourth quarter of 2023. Prescription product net revenue was approximately $9.7 million in the year 2023, representing a decrease of approximately 18% over the combined prescription product net revenue in the year 2022, which totaled approximately $11.9 million.

The combined prescription net revenue was approximately $2.3 million in the fourth quarter of 2023, representing a decrease of 18% over the combined prescription net revenue in the third quarter of 2023, which totaled approximately $2.8 million and a decrease of approximately 30% over the combined prescription net revenue in the fourth quarter of 2022, which totaled approximately $3.3 million.

Mytesi total prescription volume decreased by about 4% in the year 2023 over 2022. Mytesi total prescription volume increased slightly by approximately 1% in the fourth quarter of 2023, compared to the third quarter of 2023, and decreased by approximately 4% in the fourth quarter of 2023 over the fourth quarter of '22.

Prescription volume differs from invoice sales volume which reflects, among other factors, varying buying patterns among specialty pharmacies in the closed network as they manage their inventory levels. Loss from operations decreased by $100,000 from $34.4 million in 2022 to $34.3 million in 2023, which included an impairment loss on intangible assets of about $400,000.

Non-GAAP recurring EBITDA for 2023 and 2022 were net loss of $34.5 million and $27.4 million, respectively. Net loss attributable to common shareholders decreased by approximately $6.2 million in 2023 from $47.5 million in '22 to $41.3 million in 2023.

That concludes my recap of high-level financials for the fourth quarter of 2023. I will now hand the discussion back to Lisa Conte.

Thank you, Carol. All right, I'd like to bring this call to a conclusion that just, again, reiterating Jaguar, the family of companies, Napo, we are highly energized about our important and near-term initiatives.

Thank you all for joining. Thank you for support of our mission to support the quality of life, the dignity, the treatment outcomes of people in need around the world and in particular, our focus right now on cancer therapy-associated side effects.

We're going to end our webcast at this time. And we have one last video that we're going to play for you, the video of the Jaguar team members speaking about what cancer supportive care means to them and again, where there will be a launch of multiple digital channels. And we look forward to having an interactive conversation with those dealing with this topic. Thank you all very much.

(video starts)

Hi there. My name is Lisa Conte. I am the Founder, President, and CEO of Jaguar Health and our wholly owned subsidiary, Napo Pharmaceuticals. We are a natural product prescription pharmaceutical company. Our mission is to do something important, something lasting, something sustainable for the patients that we serve. In that vein, we are fully committed to the field of cancer supportive care. What's more important than quality of life, patient dignity, patient efficacy, patient choices, patient comfort.

So I've asked each of my senior team members to talk about what supportive care means to them. And I would like to add in the past year, I, too, became a person living with a cancer diagnosis. It happens. The key to me is living with a cancer diagnosis and not just existing. And that's the core of our mission as well. Thank you very much for this opportunity to introduce you to Jaguar and Napo.

While cancer treatment was revolutionized, as an oncologist, I took care of many patients whose needs were not met by traditional options. To me, supportive care means innovating new options to meet those needs so patients can focus on their quality of life.

Supportive care is key to one's well-being, specifically providing comfort. It's such an honor to be part of a focused team that provides support to all patients.

Oncology supportive care to me is that small cloud on a scorching summer day that blocks the sun, offering the hope of a reprieve. It's the compassionate belief that alleviating a patient's suffering or restoring their dignity may just send a message that inspires patients to keep fighting.

It's the wisdom to realize that saving a patient's life and making their life worth living are not mutually exclusive that we can have both. It's the partnership that gives each patient a voice in their own oncology care. I'm not only the National Business Director here at Napo, but I'm a loving husband of a courageous cancer survivor who's in her third year of remission.

To me, supportive care means management of the S for side effects such diarrhea or vomiting; assessing unmet supportive care needs; P for having a chronic pain team behind them; having psychological support; organized groups; and having good quality of rehabilitation; and being able to continue with their cancer treatment; having integrated care teams; and protecting other vital organs and functions; and most significantly, empathy, empathizing with the patient and being sensitive to their needs.

Cancer supportive care is really important. It's central to our mission as a company. And what it means to me was that we get to help patients through one of the most difficult experiences of their life. I sum it up in really one sentence. And it's actually not my words. It's the words of a leukemia survivor. And she said, it's not just possible to survive but to thrive. And I think that's the most important thing that we can do for patients.

What is supportive care to me? To me, supportive care is cancer care that puts the patient experience first.

Providing supportive care to a patient with cancer involves not only addressing their physical needs such as the cancer, but also addressing and caring for their psychological, their spiritual, and emotional needs.

In my role, I've seen firsthand how essential supportive care is to oncology patients. It's not just about the treatments we develop but about ensuring the quality of life for patients and their families. Supportive care means acknowledging the person behind the diagnosis and dedicating ourselves to their comfort, dignity, and hope. It's our company's core belief that every single patient deserves compassion and support on their journey through cancer treatment.

To me, cancer supportive care means addressing cancer therapy side effects so that a patient has a better chance to stay on therapy longer, improving their survival odds, while at the same time, improving their quality of life.

Supportive care to me means dignity. It means life. It means focusing on the patient that's being treated and not just what they're being treated for.

The supportive care is considered as a fundamental component of the modern oncology based upon my personal point of view. The advent of new cancer therapies, in particular, alongside expected growth and the aging of the population, better survival rates for the treatment of oncology patient, and associated cost of care is uncovering a fundamental [need] that there must be clearly defined and to be integrated the supportive care services across the global spectrum of the disease or the oncology.

For me, supportive care can be defined with two simple yet powerful words: compassion and love.

To me, supportive care means relief from unnecessary pain, the ability to live life more fully, and the ability to live with dignity, which everyone deserves.

My name is Pravin Chaturvedi. I'm the Chief Scientific Officer of Napo Pharmaceuticals and Jaguar Health. I'm also a cancer survivor. As a cancer patient from the time of diagnosis of cancer through the treatment and subsequent survivorship, for all of them affect your activities of daily living, which are really three things: eating, bathing, and mobility. To me, cancer supportive care supports all of those three fundamental and essential activities. And that's why I'm very happy to be a part of this journey. Thank you.

Supportive care to me means dignity, quality of life, compassion, kindness as part of the healing process.

(video ends)