TherapeuticsMD Inc (TXMD) 2014 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the TherapeuticsMD third-quarter 2014 earnings conference call. (Operator Instructions) As a reminder, this conference call is being recorded.

I would now like to turn the call over to Ami Knoefler. You may begin.

Thank you, operator, and welcome this afternoon to TherapeuticsMD's third-quarter earnings call. Please note that a copy of the Company's third-quarter financial results press release was issued today after the close of market. It is available on the Company's website, TherapeuticsMD.com, in the Investors section.

On today's call from the Company are Chief Executive Officer Robert G. Finizio; Chief Financial Officer Daniel A. Cartwright; Chief Medical Officer Dr. Sebastian Mirkin; and Chief Product Officer Julia M. Amadio.

Before turning over the call to the Company, we would like to remind everyone that certain statements made during this conference call may be deemed to be forward-looking statements and are protected under the Safe Harbor of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based upon current expectations and there can be no assurance that the results contemplated in these statements will be realized. Actual results may differ materially from such statements due to a number of factors and risks, some of which are identified in our press release and our annual, quarterly, and other reports filed with the SEC. These forward-looking statements are based on information available to TherapeuticsMD today, and the Company assumes no obligation to update statements as circumstances change.

An audio recording and webcast replay for today's conference call will also be available online in the Investors section of the Company's website. For the benefit of those who may be listening to the replay or archived webcast, this call was held and recorded on November 6, 2014.

With that, I'll turn the call over to TherapeuticsMD's CEO, Rob Finizio.

Thanks, Ami. Good afternoon, everyone, and welcome to our call. Third quarter has been a time of important progress here at TherapeuticsMD, with our late-stage clinical programs advancing and our current women's health business exceeding our internal expectations.

Market dynamics, including legislative and competitive factors, continue to evolve in our favor of our development programs. We're also seeing increased interest in our technology and product development programs from key menopause opinion leaders and the related scientific community.

During this call, we will review our financial results and clinical development activities. We'll summarize some important new information regarding the outlook for our late-stage pipeline and product opportunities. Dan, Sebastian, and Julia will review these areas, and then I will comment on the strategic implications and share my perspectives on why TherapeuticsMD is at an important turning-point going into 2015.

To kick things off, let me turn to Dan for a view of the financial picture.

Thanks, Rob. Good afternoon, everyone. I will start with a summary of our third-quarter financial results and then turn the call over to Sebastian for a clinical update.

For the third quarter ended September 30, 2014, the Company's operating loss was approximately $17.8 million, as compared to a loss of approximately $7.7 million for the same period last year. To simplify the presentation, we can break up the results into three separate components: R&D expenses, SG&A expenses, and revenues from the current women's health business.

The largest component, R&D expenses, were approximately $14.9 million for the third quarter, as compared to $4.1 million for the same period last year. This is a significant increase and reflects our investment in our Phase 3 clinical trials. It includes drug development, clinical cost, and a one-time bolus investment of approximately $4.1 million for a national recruitment campaign to support enrollment and create awareness of the REPLENISH clinical trial.

From this quarter forward, we expect the rate of spend to be diminishing; and once the last patient is admitted to the trial, we anticipate a further reduction in spending. As a reminder, clinical trial costs are typically frontloaded and highest during the recruitment phase, then taper off as the trial continues.

SG&A expenses for the third quarter were approximately $6 million, compared to approximately $4.8 million for the third quarter of 2013. The $1.2 million increase in SG&A over the prior year's quarter was primarily associated with increased sales and marketing expenses to support the launch of the new Pearl products, as well as professional and in fees and insurance.

The Company's operating loss for the third quarter was partially offset by sales revenue from its currently marketed prenatal vitamins business. Net revenue from product sales was approximately $4.2 million for the third quarter, compared to $2.3 million for the prior year's quarter.

Net revenue growth during the quarter was primarily related to increased sales of our new prescription prenatal Pearl products. The prescription market segment is highly genericized. Despite this competitive prenatal market, our gross margin was healthy at approximately 75%.

Cost of goods sold was increased by approximately $420,000 for the 2014 quarter compared to the prior year's quarter. Nonoperating income for the third quarter of 2014 included miscellaneous and interest income of approximately $16,000, compared with expenses from financing costs in the prior year's quarter of approximately $436,000.

As a result, the net loss for the third quarter of 2014 was approximately $17.8 million or $0.12 per basic and diluted share, compared with a net loss of approximately $7.7 million or $0.06 per basic and diluted share for the third quarter of 2013. Cash was approximately $67 million at September 30, 2014, compared with approximately $54.2 million at December 31, 2013. There is no outstanding debt.

Shares outstanding today are approximately 156 million. We continue to invest heavily in our Phase 3 clinical trials and take great comfort knowing that our rate of spend on these programs will decrease as we complete enrollment.

Additionally, we have a strong cash balance and growth of our current women's health business. Now Sebastian will provide an update on our clinical progress.

Thanks, Dan. During the recent quarter, we have been making great progress on the clinical development front and advancing our two ongoing Phase 3 programs. I am also very pleased to announce that on my one-year anniversary the Company has recruited a highly accomplished team to execute our clinical trials. The team is now complete from executive to mid-level management with the best and brightest women's health hormone professionals.

I would like now to move into our vaginal estradiol program. A major accomplishment was achieved during the quarter: we successfully initiated our Phase 3 REJOICE trial for TX-004, or VagiCap, for indication of the treatment of dyspareunia, a symptom of vulvar and vaginal atrophy due to menopause.

We recently announced enrollment of the first patient, and recruitment is well underway with approximately 55 sites currently initiated or in the process of starting up. I want to note that the majority of these sites are shared with the REPLENISH trial in an effort to optimize and maximize our resources. We expect all 100 sites from the REJOICE trial to be initiated or undergoing startup activities by the end of 2014, which puts site activation ahead of original schedule.

The final trial design includes 700 subjects with 175 subjects per arm. There are a total of four arms that include 25, 10, and 4 micrograms of vaginal estradiol and a placebo arm.

I have a high degree of confidence in the [proative] success of our REJOICE trial. This trial was designed based on a positive result seen in Phase 2, in which TX-004 10 micrograms show a steady-state significant improvement in only 14 days in FDA-recognized primary endpoints.

Summarizing the VVA program, we have the resources to support the trial. The [subjects] we enroll are well characterized and represent a large and growing segment of the female population; and today we have virtually all 100 sites identified.

Further, our experience in this women health segment and the positive interaction with the FDA has led to a clearly defined protocol. Therefore, I'm very confident that we will effectively execute this trial and deliver data in a timely fashion.

Now an update on our Phase 3 REPLENISH trial for TX-001. TX-001 is our natural estrogen, natural progesterone combination which was developed using our SYMBODA technology. This investigational product is in late-stage evaluation for the treatment of vasomotor symptoms due to menopause.

We continue enrollment in this clinical trial, targeting 1,750 subjects in approximately 100 sites. Nearly of all are already initiated.

During the third quarter, we made a one-time significant investment in a broad national recruiting initiative to accelerate patient enrollment, as mentioned already by Dan. Based on current predictions, we now anticipate the completion of enrollment being pushed into early 2015. However, given the known need for a well-studied bioidentical HRT product and our experienced clinical team in place, we are comfortable that extension of enrollment will not cause a major significant delay in the trial.

Now let me turn briefly to TX-002HR, our investigational progesterone candidate. You'll recall that we suspended enrollment and stopped the Phase 3 trial in order to update the protocol, based on recent discussion on the study design and enrollment criteria with the FDA.

FDA feedback has been very helpful providing changes to our enrollment criteria, removing a number of challenges, and updating the study design. We continue to work on revising the protocol prior to submitting it back to the FDA. Although our current focus is to deliver first REJOICE data on VVA and then REPLENISH data, we believe that these product candidates continue to offer a unique and important opportunity for the Company.

With respect to our early-stage pipeline, we are focusing on a novel, natural progesterone which is intended to deliver very low systemic levels while protecting the endometrium in those women needing estrogen therapy. Initial preclinical evaluation is to be completed this year, and this is a key step to enable a much larger PK study on a full Phase 2 trial that includes endometrial biopsies.

Providing that progesterone can potentially work transdermally offers us a significant platform for new IPs and creates a significant generic barrier, especially when paired with estradiol.

Julia will now provide an update from the recent North American Menopause Meeting and review the unique market dynamics relating to our pipeline products.

Thank you, Sebastian, and good afternoon, everyone. As you know, it is a dynamic time in the area of women's health research, given renewed interest in utilization of hormone therapy, some recent new product launches, and growing unmet market needs. This changing environment was clear at the recent NAMS Annual Meeting, and we would like to highlight a few key areas of interest, starting with VVA.

First, I'd like you to know how prevalent VVA is. According to the REVIVE study, there are 32 million postmenopausal women in the US who have symptoms, yet only 7% get treatment.

As a woman who suffers from this condition, there is general stigma about the condition and confusion about hormones. I can tell you, having used most of the products in this category, that current products still leave a lot to be desired.

Now let me share with you our four target product profiles goals for VagiCap, based on some of these unmet market needs. Number one, to demonstrate an efficacious product with a wide dose range, namely 4-, 10-, and 25-microgram doses of vaginal estradiol, covering a wide spectrum of women's needs. If approved, the 4 microgram would be a new lower effective dose; and the 25 microgram would fill the long-felt need created when Vagifem 25 microgram stopped being marketed.

Number two, demonstrate efficacy with an early onset of action, even in the lower doses. This is a key market need that we really haven't mentioned before.

Number three is to provide efficacious, local, estrogenic therapy with very low to negligible systemic exposure. And number four is to provide an improved user experience, with ease of application. I personally feel that if our product achieves these defined target goals it will have the potential of raising the bar for this class of therapy.

Now let me tell you about the market segment and its growth. The last trailing 12 months sales data from Symphony Health Solutions show total US sales for currently available FDA approved VVA products were $1.3 billion. That is a 25% increase year-over-year.

There was 5% growth in annual prescriptions, which shows that the price increases still account for most of the growth in this category. And there are still no generics in this segment.

In this growing market, the additional influence of direct-to-consumer marketing for Premarin low-dose cream and Osphena are also increasing patient awareness of this underdiagnosed condition. In addition, there is an aging population of US women who want to stay active and feel young, which we believe will be a good foundation for continued market growth.

Now turning to the medical society standpoint, several organizations are working to help increase awareness of VVA. NAMS and ISSWSH, the International Society for the Study of Women's Sexual Health, just published a joint statement in the October issue of Menopause to revise the VVA nomenclature, to address it as genitourinary symptoms due to menopause, as this encompasses more of the overall conditions a woman faces in dealing with the lack of local estrogen.

These groups are attempting to make this condition more user-friendly, similarly to ED nomenclature revisions to address erectile dysfunction. This renaming is to help encourage greater discussion among women and their physicians.

In summary, our generation wants to feel young, stay sexually active, and not suffer from this very uncomfortable condition. Although low-dose local estrogen therapy is considered front-line treatment, as a user I can tell you current products still leave room for improvement. Again, if our product achieves the defined four target goals, it could really help answer some of these unmet needs.

Now a development from NAMS about the combination market: another compelling area of interest at NAMS was research that underscores the prevalence of compounded hormone therapy use by women in the US. In a poster highlighted by NAMS, researchers from University of Colorado and University of Virginia outlined the use of compounded hormone therapy by an estimated 1 million to 2.5 million women in the US. The majority of these women were unaware that their treatment was unapproved by FDA.

A related poster documented the use of FDA-approved hormone therapy by an additional 3.7 million women. Following publication of Women's Health Initiative in 2001, this data suggests the compounded segment grew significantly while FDA-approved hormone therapy segment decreased. This supports the proposition that the market need never went away; it just went underground.

The Endocrine Society circulated an article regarding this data in which Dr. JoAnn Pinkerton from the University of Virginia was interviewed about the posters. The abstracts are all published in the Journal of Menopause; and Dr. Pinkerton and Dr. Nanette Santoro's manuscript based on the presented poster is in process to be published in the Journal.

The increasing attention by thought leaders and medical societies to the prevalence of compounded hormone therapy further validates the size of the market and the Company's opportunity. As we wrap up 2014, I could not be more optimistic about the market need for both of our late-stage products.

We have first mover advantage. We are not aware of any direct competitors developing a bioidentical oral combination. And we are very pleased to see two medical societies validating the size of the compounded market, with more data to come.

Now let me turn the call back to Rob.

Great. Thanks, Julia. As my team describes, we continue to move forward quickly towards the last patient enrollment in both REPLENISH and the REJOICE trials. Today, we begin to give some additional color related to IP, sales, and other areas that will gain importance as the REJOICE trial's top-line data is just three quarters away.

Let's start with IP. We now have 57 patent applications filed both domestically and internationally. We believe that our initial patents granted earlier this year are broad and strong.

In recent discussions with the Patent Office, I am very happy to announce that we expect another five to seven patent allowances during the next quarter. Our granted patents significantly enhance our competitive position with pharmaceutical companies and, if needed, compounding pharmacies. These new allowances are expected to provide additional layered coverage, strengthen our exclusivity position, and provide additional barriers to entry against our competitors through the early 2030s.

In addition to our US patent strategy, we have numerous PCT and foreign National Stage patent applications pending in key strategic jurisdictions that mirror our US patent strategy. We filed in Europe, Canada, Japan, Brazil, Australia, Mexico, and Argentina. We're adding filings in South Africa going forward, and this global strategy will play a very important role as data quickly approaches for VVA and then combo with our international partnership strategies that are beginning to form.

In addition, large pharma has for the most part left the hormone development space after the Women's Health Initiative. Data validating the market size has been presented at NAMS and additional market size research is expected over the next 12 months. We do expect to see both large and small pharmaceutical companies take a renewed interest in the women's health hormone space.

It is nearly one year since Congress passed the Drug Quality and Security Act. This gives the FDA broader powers to regulate compounding pharmacies and to protect the public health from overuse or misuse of unapproved drugs. It also ensures access to compounded drugs for patients who cannot use FDA-approved products for medical reasons.

Since then, we've seen the FDA start the process of implementation and enforcement of this new law. We've seen payers and state's boards of pharmacies follow suit.

We also believe the new legislation brings greater clarity to potential liability concerns for the medical community. And as the FDA publishes its list of products that should not be compounded for safety or efficacy reasons, physicians and pharmacies will quickly respond.

And again, TXMD will not see the direct benefits of this legislation until potential approval and launch of our investigational estradiol-plus-progesterone product. However, we are watching the pace of enforcement with interest and continue to believe it will have a positive effect on the future of our products.

Moving on to REPLENISH and REJOICE trials, our current expectation is that the combo trial will complete enrollment in early 2015. Part of our confidence comes from our one-time $4.1 million investment in recruiting that Dan previously mentioned. We expect benefit from this through the remainder of the trial.

Our Board of Directors and executive management made a collective and strategic decision to share combo trial sites with our VVA trial. Because of this decision, we are currently ahead of schedule for VVA site activation, ensuring we reach our first data point in Q3 of 2015.

With this in mind, 2015 will be a pivotal year. We are reconfirming our last patient in for VVA in Q2, and data in Q3 of 2015. We believe the VagiCap candidate will potentially be a game-changer, assuming our Phase 3 data supports our four product goals that Julia previously mentioned.

I'd like to reiterate: the clinical trial costs associated with our VVA and combo programs will significantly diminish as our enrollment is completed.

Looking ahead, for the first time I'd like to draw attention to our vitaMedMD business. This part of our business has served as an infrastructure platform with OB/GYNs, payers, distributors, and pharmacies.

We compete in a highly genericized, very crowded, prescription prenatal market and are growing at a significant rate with very healthy gross margins. As data quickly approaches, our ability to execute on the sales side will play a more important role.

Assuming positive VVA data that supports our four product goals, TXMD should be uniquely positioned to make a significant impact in this product segment. This is a very exciting time here at TherapeuticsMD.

I'll now ask the operator to open calls for any questions. Thank you.

(Operator Instructions) Bill Tanner, FBR Capital Markets.

Thanks for taking the questions. I had a couple of them. Rob, just on the recruitment program for the REPLENISH study, wonder if you could just explain the need for that, just in terms of -- one might think that it should be easy to recruit patients for a trial who is looking at bioidentical; and then whether or not we should contemplate there being one needed for the REJOICE trial. And then had a couple of follow-ups, please.

Great. Bill, thank you for joining today. I appreciate you joining here.

So, the combo or the estradiol and progesterone trial is going very, very well. Enrollment is clearly accelerating; it continues to accelerate. That one-time bolus investment is to ensure that we deliver results and we deliver them effectively.

This patient population is so well characterized and identified with -- 100 different sites are up. We really like our situation here. I want to be very clear that identifying patients is not a problem for this trial at all. There is a very large population out there.

I hope that answers your question, but we are very bullish on this. The reason we decided to slightly delay the enrollment goal here was due to the shared sites. And since there's two months left in the year, we don't know what the impact of that will be on the REPLENISH trial, so we just wanted to take a conservative approach.

We don't see any major delays whatsoever, and that actually -- since VVA is our first data point, that actually has put us ahead on our site activation. And we are hoping and believe that will translate into patient recruitment very quickly as well.

We do not see any more one-time upfront costs for recruiting for any trial. That one-time $4.1 million bolus investment in recruiting will not occur again for either one of these trials and we believe that nothing like that for the VVA trial, which we call REJOICE, is needed whatsoever.

I hope that answers your question. If it doesn't, please ask me more.

No, that's fine. Then just as -- I don't know if you want to give the level of detail. But if you just back out the $4.1 million you're around $11 million. So just the slope of that going forward until you begin to roll off the studies, is that a continued ramp? Is it more flattish?

Yes, great question. Obviously, Bill, we don't forecast; but if you look in the Q we expect the combo cost for the rate of spend only to diminish.

Okay.

And if you compare that to the VVA, remember the VVA or REJOICE trial is only a 12-week trial with only 700 patients, compared to a one-year trial with 1,750 patients. So assuming the enrollment we previously forecasted in the call, we only have a couple quarters left of heavy burn, assuming that rate stays.

And again we're not forecasting, but we are very positive and optimistic. To your point, I mean, our trial/clinical expense this quarter was $10.8 million. Outside of the one-time $4.0 million recruiting costs, we only burned $3 million on SG&A, right?

So I just want people to take a good look at those numbers, a good look at our timelines, and a good look at our cash position and I think they are going to be pretty excited. So we are.

Okay. Then maybe a last question for Julia, just as it relates to 004. One of the criteria you mentioned was rapid onset. Just wanted to understand that a little bit better.

Is that the onset when a woman begins therapy at all? Or is that the onset on a daily basis, once they take -- once they administer the drug?

The rapid onset would be actually when you first notice the impact. So it would be -- I mean, there is actually a rapid peak because of the SYMBODA technology.

Right.

It actually does peak very rapidly per dose. But then we are also anticipating, because of the results that we actually saw in our Phase 2, that we may actually see good clinical efficacy results in a rapid time period.

Okay.

Okay. Anything you want to add to that? Bill, I think Sebastian wants to add something to that.

Yes. Let me try to clarify and respond to this question. Basically, there are two key and fundamental aspects of VagiCap that's unique to this product and unique to this compound: number one, the pharmacokinetics of VagiCap; and number two, the positive Phase 3 clinical data will serve in the clinical trial.

So we observe that 10 micrograms of VagiCap has a more potent efficacy with an early onset of action than any other product out there in the marketplace. So we are very confident that women that really are suffering from VVA won't need to wait too long to see a benefit when using VagiCap in the future.

Okay. That's helpful. Thank you.

Ryan Martins, Jefferies.

Hi, I just wanted to ask on your transdermal programs, what other additional preclinical studies -- are you doing any? You mentioned you were doing some more preclinical studies?

Yes. Hey, Ryan; this is Rob speaking. We've got a few preclinical studies that we expect to complete by the end of the year. Once those are completed, assuming that they are positive -- and we believe they will be, but won't know for sure till we have the data -- this will enable us to roll into a much larger PK/Phase 1 study than we've done in the past.

But more important, it will allow us to do biopsies in Phase 2a and make sure that this transdermal progesterone is binding to endometrial tissue. The reason we want to do that is that will provide -- assuming that blood levels are still nondetectable for both progesterone and estradiol -- that will provide an entirely new IP platform for us that will extend to everything that has progesterone in it.

We do still intend to partner the transdermal development here in the US. We do not want to do it before we have that data in hand, or it could actually sabotage our IP position with our oral product, and that's not a risk we're going to take.

But we are very bullish. We're very positive, and we would really love to create a good transdermal product that uses progesterone transdermally, FDA approved for the first time, and with negligible to no blood levels like we found in our first study would create significant generic barriers. And we think that would bring a lot of value to us, to women, to thought leaders, women's health as a whole, as well as to whoever the partner would be as well.

Thanks a lot, Rob.

Nathan Cali, Noble Financial.

Hey, guys. Thanks for taking the questions. On the VVA product, just wanted to ask an additional question on the peak that you are seeing in regards to FDA labeling and potential claim there. Is there any additional information around that?

If your 0.4 comes in where you need it to be for VVA, and that peak that you are seeing there is likely to continue based upon the formulation, are you still going to shoot and see the possibility of a labeling claim for the low dosage -- due to systematic lower -- lower systematic exposure?

Right. It's a great point. I do believe the short answer for your question will be yes. Certainly if 4 microgram of VagiCap will show what we believe that it will show, none to negligent systemic absorption of estradiol, I do believe that we will differentiate to any other product out there in the market. And certainly this will be part of our label negotiations as the major way to differentiate from other products.

So I'm very confident that we're going to have the opportunity to share these data with the FDA and certainly partner with them and partner with others. Societies are sort of petitioning to get some of these vaginal products to be labeled without many of the warnings or precautions that most of the vaginal products are currently labeled.

Okay. Timeline on the combo data: when is the expectation of that? I know you said you're going to hope to have it enrolled by 2015 first quarter or first half. And then data is expected --?

Yes, Nathan; this is Rob. Once the last patient's in, unlike the VVA trial that's only 12 weeks, this is a one-year trial.

Right.

That's why I'm starting to turn the page here with my team on the earnings call here, and look at some of our sales and IP and international strategies. Because that's a very short trial.

As you know, the combo is a one-year endometrial protection study with a 12-week embedded VMS study. So once that LPI, or last patient in, is announced, it will be -- the clock will be ticking to one year.

And we're excited. I mean, if you think back, we've been working on this a long time. You guys have known us for a while and it's really exciting to think that in just a couple quarters we will have last patients in -- I should say few quarters -- as well as announcing data, unless something changes.

But we're pretty bullish. We're in great shape.

Excellent. Congrats, man.

Thank you.

Yes, and then progesterone itself, the progesterone product, can you talk about that a little bit as far as the Phase 3 and the relevance of that and potential for partnering around any one of your products?

Sure. I'll touch on that; and then if I'm not answering anything from a clinical or FDA standpoint, I'll pass it to Sebastian.

Progesterone, we still see there is a good dollar value there. There is -- the formulation really has some attributes that we believe with a -- not a very long trial and our ability to hopefully remove a number of these roadblocks with the FDA so far has been very positive. So we are bullish on the investment, but we have to remain focused on VVA.

That's our first data point, delivering that data, delivering quality data. If we can hit all four of the target product profile goals that Julia mentioned, we believe it's an absolute game-changer in the segment. And we are very bullish that we can do it.

Obviously, the data is going to prove whether or not we can. But I'll tell you, we've done a lot of research here, we've got a great team, and we think we can hit all four of those goals.

So we are razor focused on that. We are laser focused on the combo trial that comes in right behind it. And once one of those finishes and reads, we have the capacity to go ahead and start up another trial. The SPRY trial at this point in time we believe is next in line.

As far as moving on to partnerships, there has been a lot of interest coming in over this last quarter, just to be honest and upfront with people. I think the validation of the size of the market by NAMS as well as endocrine, mentioning it, and all of the additional research coming on the combo has really changed some of the current interest in the combo vasomotor space. And the VVA space is continuing to grow worldwide with the Baby Boomers.

So internationally we will entertain, once we have VVA data, a partnership in select countries. And I think you can see by our patent filings, that's a preemptive strike to be able to do that on a very positive ground.

Then on the combination, we still would like to hold rights worldwide in our hands; but we would be open once we have data to looking at that internationally. And then last but not least, we have every intention domestically and internationally on partnering on the transdermal programs, but those are a little bit behind the Phase 3 programs. Okay?

Okay. So on VVA data, you expect the potential for something on the partnership side?

Yes, absolutely. Absolutely. I think that, given we hit some of our data points, there are a number of companies watching and would have a high level of interest. I think eliminating or reducing the need for a US launch by partnering, I would say, five or 10 of the countries out in the US could unload that burden from our back and allow us to really do what we need to do here in the US.

I don't see anything but shareholder appreciation there. And again it's going to hang on the data. We bring good data, things will move and they'll move quick.

Okay. Then just one more question on the formulation itself and SYMBODA technology. Have you guys thought about any -- I know that you're quite busy with three Phase 3, but have you thought about any additional indications with the hormone active that you could potentially address? And have you filed any IP on anything that you can mention?

To answer your question, we've thought about it; but again, it's all about focus here and spend, right? I mean, think about the funds listening: they've invested in us to deliver data on these two lead programs that are both potentially blockbusters. Once we bring those to bear I think we might look at some new indications.

I can't comment on filing of IP without Marlan's permission, so I'm going to have to hold there. But it's a good question. Thank you.

Yes, and then just one more for Julia. Could you just mention real quick the items that you'd like to address with the product? Target product profile for the VVA product, the four things.

Absolutely.

Sure. Basically -- hang on one second -- we are looking at having a wide range of doses, so being able to provide potentially the new lowest dose of the 4 micrograms, while also having a 25 microgram which fills an unmet need that I think was created when the Vagifem product was stopped marketing.

We also have the demonstrated efficacy with the early onset. That again is something new that we hope to see because of the technology in all of the doses.

The other aspect you mentioned before, which is the low efficacious local estrogenic therapy with minimal to negligible systemic effects. We'll see that in the study, because we are testing for that.

And then overall, we're also looking at improved overall user experience: simple application, easy to use, and satisfaction.

Okay, great. Thanks a lot.

(Operator Instructions) Bill Tanner, FBR Capital Markets.

Thanks for the follow-up. Rob, just on the DQSA comment that you made at the end of your prepared remarks, it sounded like the FDA would be disinclined to put compounded e-plus-p on a do not compound list until your product was in the market. Is that true? And then is that just them not wanting to deny access to something like that, or what's the --?

You know, Bill, I'm speaking from personal -- obviously I'm in no position to have this dialog with the FDA, right? And they probably wouldn't entertain if I asked anyways. So I'm just speaking from working with like Sarah Sellers and a number of the experts in the field that really are following this very closely.

I believe that steriles are in their crosshairs. You look at the enforcement actions, there is a lot of them and they're all focused currently on the sterile market.

I think they will move to the nonsterile enforcement and begin with the high risk, where the law is being broken. We do believe -- and Bill, it's great you bring this up; this is something we did not mention. We do believe that the bioavailability of compounded progesterone in powdered form is lacking. There are endometrial cancer papers just recently out that are linked to bioidentical compounded hormones with powdered progesterone, which is very common if not the only way I've ever seen it.

And then we do know these warnings are on the FDA's website. But at the same time, for the FDA to get between a prescriber and a patient at the doctor's will I think is a very hard position for the FDA to be in.

I think it would be much easier for them to shift the market to an FDA-approved drug, and for us to make sure that we are paying the pharmacies as much if not more than what they are making today with our drug, just wins for everybody. I hope that's how it turns out. I obviously can't forecast here, but that's the way we think it's going here at the Company.

Okay, all right. That's helpful. Thank you.

Thank you. There are no further questions in queue at this time. I'll turn the call back to Robert Finizio for closing remarks.

Great. Thank you, operator. Everyone, thanks a lot for joining the call today.

We've had a great quarter here at TXMD. We've executed across numerous fronts. Our trials are progressing; our IP portfolio is expanding globally.

This has been an incredibly productive quarter, with our current women's health business growing, and we look forward to an exciting 2015 with lots of updates. Thank you all for joining today, and we look forward to our next call in early March. Thank you.

Thank you. Ladies and gentlemen, this concludes today's conference. You may now disconnect. Good day.