Good afternoon. And welcome to Cara Therapeutics Fourth Quarter and Year-End 2014 Conference Call. At this time, all participants are in a listen-only mode. There will be a question-and-answer session at the end. Please be advised that this call is being recorded at Cara's request. I would now like to turn the call over to the Cara team. Please proceed.

Good afternoon. This is Jesse Baumgartner with Stern Investor Relations and welcome to Cara Therapeutics fourth quarter and year-end 2014 conference call. The news release with our fourth quarter and full year financial results and corporate update became available at 4 o'clock PM today and can be found on our Web site at www.caratherapeutics.com. You may also listen to a live webcast and replay of today's call on the Investors section of the website. Before we begin let me remind you that statements made on today's call regarding matters that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Examples of these forward-looking statements includes statements concerning the expected timing for the company’s clinical trials statements concerning the potential results of planned clinical trials and future development milestones for the company’s product candidates. Such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Risks are described more fully in Cara Therapeutics' filings with the Securities and Exchange Commission, including the Risk Factors section of the company's Annual Report on Form 10-K filed for the year ended December 31, 2014 and its other documents subsequently filed with or furnished to the SEC. All forward-looking statements made on today's call speak only as of the date on which they were made. Cara Therapeutics undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made. Now let me turn the call over to Cara's President and CEO, Dr. Derek Chalmers.

Thanks, Jesse. Good afternoon, everyone. Thanks for joining us on the call this afternoon. I am joined today by our Chief Financial Officer, Jose Schoell and our Chief Medical Officer, Dr. Joseph Stauffer. 2014 was certainly an important year for us here at Cara Therapeutics starting with our successful IPO in January of last year and including several significant data readouts throughout the year as we continue to execute on our clinical development plans for our lead intravenous CR845. So this afternoon we planned to briefly summaries So this afternoon we plan to briefly summarize important development milestones achieved in '14 clinical plans and results for the rest of 2015 and then we'll run through the financials and end with the Q&A session. So to start with let me highlight what we consider to be a very important clinical dataset from our human abuse potential clinical trial we reported in the fourth quarter of 2014. This trial designed in consultation with the FDA and their controlled substance staff tested the abuse potential of intravenous CR845 administrated as [indiscernible] against the comparator Schedule IV opioid. As measured across the range of validated objective scales and non-addicted poly drug abusers. Data from this trial unequivocally confirmed that I.V. CR845 offered a significantly lower abuse potential than the standard Schedule IV comparator, it also reinforce our general therapeutic approach here that is by selectively targeting peripheral capital opioid receptors we can avoid the undesirable side effects including the euphoria and abusability associated with currently available pain therapeutics. This will be an important differentiating factor for both our intravenous and oral formulation of CR845 moving forward. With regard to our lead program for intravenous CR845 in acute pain, in 2014 we completed all the necessary CMC work to enable initiation of Phase 3 trials in the first half of this year upon the completion of our end of Phase 2 meeting with the FDA which is presently schedule during the second quarter of this yeah. We currently plan to conduct three Phase 3 trials which we believe will provide the breath of patients and surgical exposures as well as a necessary number of drug exposures to enable a successful NDA revenue process. So let me now the turn the call over to Cara's CMO, Dr. Joe Stauffer to run through the main elements of our proposed Phase 3 trial designs.

Thank you, Derek. These planned Phase 3 trials for I.V. CR845 will be similar in design to our completed Phase 2 clinical trials in terms of both type of surgical model employed and clinical end points. I should also add that trials conducted by other companies in recent years for FDA approved acute pain drugs have run similar Phase 3 development programs in soft and hard tissue models, using the same primary end points. So of course our final protocols will demand on our meeting coming up with agency, there is certainly a precedent from this path. The first trial we expect to be randomized a double placebo control in approximately 400 male and female patients with post-operative plan after [indiscernible] the surgery, the hard tissue model which was used in one of our successful Phase 2 trials. The patients will be assigned to receive one of three doses of intravenous CR845 or Placebo. The primary efficacy end point of the trial is expected to be the SPID or the sum obtained intensity differences at 48 hours. Secondary end points will likely include rescue medication morphine use, SPID at other time points, TOPAR which stands for total pain relief at 24 hours in occurrence of nausea and vomiting. The second trial is expected to be randomized double-blind placebo control trial in approximately 400 female patients with post-operative pain after laparoscopic assisted hysterectomy a soft tissue model which was also used in one of our successful Phase 2 trials. The patients will be assigned to receive one of three doses of intravenous CR845 or Placebo administered pre-operatively and post-operatively. The primary efficacy end point of the trial is expected to be the SPID at 24 hours. Secondary end points will likely include morphine use, SPID at other time points, TOPAR at 24 and 48 hours in occurrence of nausea and vomiting. The third Phase 3 trial is expected to be randomized double-blind placebo control adapted design trial in approximately 500 to 600 male and female patients with post-operative pain after laparoscopic assisted abdominal surgery, another soft tissue model. The patients will be assigned to receive one of three doses of I.V. CR845 or Placebo administered pre-operatively and post-operatively. The primary efficacy end point of the trial is expected to be the SPID at 24 hours. Secondary end points will likely include morphine use, SPID at other time points, TOPAR at 24 and 48 hours in occurrence nausea and vomiting. We expect to initiate the first of these trials in the second quarter of 2015 following our meeting with the FDA and the other two trials in the second half of 2015 with data readouts coming in 2016 to enable NDA submissions as soon as possible thereafter. Now I would like to turn it back to Dr. Chalmers.

Thank you, Joe. So in addition to I.V. CR845 program for acute pain we have also made considerable progress through 2014 in both our oral CR845 program for acute and chronic pain as well as completing the necessary regulatory and clinical ground work to enable testing of CR845 as a potential and novel antipruritic agent. So let me walk you through both of those programs now in summary. For our Oral CR845 program in the fourth quarter of '14 we reported top-line data from a Phase 1a/1b trial of the tablet formulation of Oral CR845 conducted an approximately 150 healthy volunteers. This trial assessed six tablet strengths of CR845 ranging from 0.1 mg to 10 mg, after single dose administration, as well as three tablet strengths ranging from point 1 mg to 5 mg after BID dosing over a one week dosing period. All tablet strengths were safe and well tolerated with no SAEs reported after either single or multiple dose administration and more over all tablet strengths were confirmed to be pharmacologically active as confirmed by standard biomarker management. Tablet strengths resulting in plasma exposures analgesic to those used in successful post-op pain Phase 2 trials with intravenous CR845 have been identified and this data along with our PK data from this trial will then form the design of our first Phase 3 trial with Oral CR845 which we aim to initiate in the second quarter of this year with data readouts around the end of last year. We believe the potential of Oral CR845 to address significant unmet medical need for a safer alternative to opioids, NSAIDs and anticonvulsant agents for the treatment of acute and chronic pain is clearly significant. Now I like to turn to our emerging clinical program in a non-pain condition and that is…

Thanks, Derek. I will be going over our fourth quarter financials here on the call and our accumulative full year numbers can be found on the press release just issued today, as well as our 10-K which will be filed later today. All per share numbers I will be discussing are on a basic and diluted basis. We reported a net loss of $4.2 million or $0.18 per share for the fourth quarter of 2014, compared to a loss of 2.1 million or $0.49 per share for the same period last year. The weighted average number of shares used in the per share calculation increased to 22.8 million from 4.3 million shares for the respective periods due to common shares sold in our IPO and automatic conversion of convertible preferred shares into common shares in connection with the IOP during the first quarter of 2014. Collaborative revenue was 0.4 million for the fourth quarter of 2014 compared to 1 million in the same period of 2013. Clinical compound revenue was 515,000 and 14,000 for the fourth quarter of 2014 and 2013 respectively. Research and development expenses were 3.5 million in the fourth quarter of 2014 compared to 2 million in the same period last year. The higher R&D expenses in the fourth quarter of 2014 were principally due to an increase in direct preclinical studies and clinical trial costs and an increase in consultant services to support the preclinical studies and clinical trials. General and administrative expenses were 1.8 million in the fourth quarter of 2014 compared to 1.1 million in the same period last year. The increase in the fourth quarter of 2014 was primarily due to increases in payroll and related costs mostly due to increases in headcount, directors’ and officers' insurance costs, public investor relations costs and stock option expense. At December 31, 2014 cash and cash equivalents totaled 52.7 million compared to 12.4 million at the end of December 2013. The increase in cash and cash equivalents is principally related to the 57.8 million net of underwriting discounts, commissions and offering expenses paid in 2014 raised in our initial public offering which closed on February 5, 2014. This increase was reduced by 17.6 million of cash and cash equivalents used in operating activities during the year ended December 31, 2014. Now, we'll turn it back over to the Operator for questions.

[Operator Instructions] Our first question comes from Annabel Samimy of Stifel. Your line is open.

I want to ask you about the Phase 3 program. I just want to understand the decision around for designing a third Phase 3 trial. I know that initially it’s just the hard tissue and the soft tissue, now it looks like you're looking forward something in more of a general abdominal surgery setting, so just if you could explain the rationale behind that? And then also with the Phase 2 data on oral and the uremic pruritus coming out this year, is it going to prepare a path for Phase 3 for next year or are you're going to have to conduct additional Phase 2 trials? Thanks.

So I'm going to let Joe -- well I'm going to let Joe talk directly to the strategy behind the three Phase 3 trials for the acute pain indication and then I'll come back and address your questions on oral and [UP].

Sure so thank you Annabel. So the idea here comes from two to three, it's a shots on goal approach, more shots on goal with three trials and specifically two trials in abdominal surgery or soft tissue versus one. The other comes from the fact that doing two trials each of 400 patients, they're really an appropriately sized trial, the 400 in bunion and a 400 in hysterectomy. We've got experience in those models. We know based on the sample sizes that we're well powered for an appropriate effect size in those models. Speed of recruitment is also helpful when we separate these trials particularly hysterectomy is just obviously women with hysterectomy versus abdominal with a mixed bag of surgeries under that abdominal umbrella. Also the adaptation gives us an opportunity to ask for special protocol assessment to have the agency buy into what we're planning on doing with that trial. As you know we need about 1,500 exposures total; this is a new chemical entity and those are the bottom line metrics for what the agency is looking for. So in doing three trials versus two we have the ability to generate more exposures in men; not that we have to but that's a nice to have. It also gives us as I said an opportunity to prove efficacy and safety in a broader patient population which I think will make the agency comfortable. And again so that's the basic general idea and then you had a second follow up question to that.

Yes thanks Joe let me just address Annabel, for the other two programs you asked with respect to the oral, we really envisage the Phase 2 in 2015 being our first Phase 2 in that area and we're looking at this point to run a second initiating probably early in '16 which we cover slightly different clinical situation than we anticipate for the first trial. So with both of those trials we maybe in a position to think about where we go for registration and at some point towards the end of ’16. For uremic pruritus, it really depends on the data as we said a number of times. We think we've designed the Phase 2 trial very robustly. It certainly contains the appropriate -- obviously edge scale but also the quality of life scale that we presume the agency and we're seeing from the other guidance are going to look for. So that data is as robust as we hope and anticipate then our plan is to look for guidance from the agency on where we need to go for registration after that particular trial. So that’s going to depend on our guidance.

Okay. And if I can just ask the follow-up regarding R&D expense expectations with the third trial and just in general from 2015 clearly there is going to be a ramp up, can you split it for us, in our heads a little bit and where you are with cash in terms of completing those programs and the cash for that?

Yes, so let me just -- Joe can tell you exactly where we are the cost cash runway in just a second and let me just say moving from two trials which of course were two larger trials of 600 patients in bunion and [indiscernible] to three trials to which were 400 and one 600. The increase in expenditure there is actually minimal, a few million in increased expenditure and we think that’s obviously money well spent as Joe has described the advantages of moving from two to three. In terms of overall runway we are still in a very healthy situation and Joe can summaries that.

Yes, I just certainly agree with Derek in terms of the split in the additional cost is not very large relative to the three trials and with the cash on hand and the operating program that we have, we have sufficient cash and cash equivalents to cover our expenditures for at least 15 months and that’s without giving effect to our potential milestones with our collaborative partners. So I think we're in pretty decent shape right now.

Thank you. The next question comes from Charles Duncan of Piper Jaffray. Your line is open.

Hi guys, this is [Roy] in for Charles. Thanks for taking the question. What do you guys think for the doses for the Phase 3, give me idea if there?

We do [Roy] and very simply I can say we're going to anchor those around the bunionectomy dosages that we've shown to be application in our Phase 2 trial and we’re going to pick a dose that’s higher than that and a dose lower than that, with the idea that we led to identify a minimal effective dose also.

Okay, that’s helpful, thanks. And then can you give us little more update on the Maruishi studies whether at and timelines for data maybe?

Maruishi is making terrific progress in Japan. They’ve already completed the Phase 1 trial and healthy volunteers with I.V. CR845. They are presently planning to initiate UP trials with I.V. CR845 probably later this year.

Thank you. Our next question comes from Alan Carr of Needham & Company. Your line is open.

Hi. Thanks for taking the question. Wanted you to talk a bit more about that third trial, there is a pre-operative and post-operative elements in terms of CR845, wondering if you could talk about benefits and risk around that and then also we expect the [indiscernible] from a milestone payments may be coming to you, talk a bit more about both [time] of those and scale of those things.

So, Alan pre-op and post-op dosing is exactly how the Phase 2 trial in hysterectomy was dosed. As you may know, in fact we just presented that data last week in American Academy of Pain Medicine. The dose of drug was given about an hour prior to surgery and hysterectomy took about three or four hours and then the next dose of drug were given when patients randomized when they had an appropriate pain score. So it gives the anesthesiologists, and the patient the ability to get drug on board more sooner rather than later, which is an appropriate way to dose these kinds of compounds, so it is actually recommended by actually the American Society of Anesthesiology, trying to stay ahead of the pain scores for patients still pre-operatively. So the same way that we dose drug in hysterectomy trial in Phase 2 that’s the way we're going to propose to dose it in Phase 3 and the same will be for the lab abdominal trial as well. So it gives you the ability to get drug on board soon and then to maintain that drug level, blood level overtime. The drug will be dose then on intervals every six hours. So it gives you a best chance for efficacy. So that’s the benefit. The risks, this indeed this was a true central reacting new opioid the risk you would have particularly when you pre-op dose somebody is that you’re worried about respiratory depression and of course you would have to dose it with nasal cannula oxygen on board or some other type of supplemental oxygen. The good news for us is that we don’t have to do that because this drug doesn't penetrate the CNS, for all intents and purposes it doesn't cause the respiratory depression and so that risk isn't there. So in fact I don’t see any risks, it only benefits by dosing it this way. And as I said we’ve done it before in Phase 2 in hysterectomy with some pretty nice results.

Thanks Joe and Alan the second part of your question or your same question regarding Maruishi, as you know the way that license is structured we received milestone payments as they develop 845 in their territory and we also receive milestone payments as we advance 845 here in the U.S. So, the next milestone we anticipate as we move into UP patients or dialysis patients. As I said later on this year would be a $2 million milestone payment to us.

Our next question comes from Jim Molloy of Summer Street. Your line is open.

I wonder if you can talk, Joe. Perhaps little bit more on the adaptive nature of the third lap trial and what are we looking for there? And then on the three trials, I imagine the third lap trial is the sort of gating factor, what do you guys see in terms of the gaining factor, forgetting these trials done, which one should go fast or slowest?

Well, I’ll take your last part first, I mean we think that bunionectomy will likely start first and finish first just because that trial dose type of surgeries tend to enroll quicker, very likely the lap abdominal procedure study will be probably the longest to enroll simply because there is maybe more patients in that trial, depends on the final number that we land with the FDA as we stated between 500 and 600 total patients, that’s about if you can do the math 125 to 150 per arm. And when it comes to adaptive design, the features allow the trials to be more efficient by guidance changes and start duration or sample size following review of the interim data. Now sometimes they start or design or duration may or may not be needed following this review, but the adaptive design does allow us to -- ones we agree with the FDA to make modifications, if the interim data tells us that we need to base upon robustness of the analgesic signal. So in the case of this trial, we haven’t tested the drug in lap abdominal, our general abdominal surgery. However, we believe that these patients are going to react very similarly to the lap hysterectomy trial that was done previously, but for some reason as I said at the interim analysis are not what we would expect and that would give us a chance to say sample up and go higher in sample size to protect us against efficacy failure.

And maybe on a follow-up little bit on Annabel question, I mean the fourth quarter R&D is down pretty sharply. I know getting a guy like Joe on board doesn’t come cheap; I imagine that number is going in other direction. Should we see something along those lines of third quarter for R&D going forward, growing from there?

Yes, clearly as we initiate the trials Jim you're going to see that number increase.

Thank you. Our next question comes from Ken Trbovich with MLV & Company. Your line is open.

I just wanted to follow-up on the Maruishi side, I know Derek you mentioned the amount is that milestone payable of initiation or completion?

Yes that sales -- that’s payable upon initiation.

And the fact that we just saw a large order that was just shipped, does that give us any indication that they’re preparing that study for the early part of this year?

My goodness you're good detective, aren’t you. Yes, I think we’ve guided the Maruishi plants to move into dialysis patients this year.

And when you describe this as a Phase 2 -- help us understand in the context or relative to the UP study that you have. Do you suspect that they are going to be looking at larger sample size more what we think of as a 2b or is this more likely 2a type design?

Ken, I couldn’t answer that question specifically because I’ve yet to see the design on that but it’s certainly going to be a Phase 2 trial looking from that.

And then just kicking on the UP side, can you give us a sense -- we’ve heard anecdotally from others doing we’re going to space in enrolment in that study is -- or at least in that model is fairly rapid, are you having similar experience?

Well, I think we’re having an experience that we expected in terms of how quickly we can populate that drawback. We’ve also guided we expected to see data in the first-half of this year and that still our expectation on that.

And then for Joe just on the lap abdominal study, the third Phase 3 that you described, can you give us a sense for the male side? Are we talking about lap hernia, what are we talking about specifically?

It will be more maybe lap prostatectomy, lap resections of bladder, doing kidney resection, maybe gall bladder resection, that type of thing. In fact hernia probably no, in fact I would say almost definitely know.

And is the reason for that just the absence of paying with that model?

What in hernia?

Yes.

Partially yes and also we’re really looking to get into the abdomen. As you know the hernia can be in the abdomen, it tends to be more in the groin than anywhere else, although you do have to open the abdomen sometimes, that involves sometimes and sometimes not more use of mesh which we’re not really getting into or want to get into here. And what we’re really looking for is that manipulation of organs for the distributable pain portion of the surgery and so again I think you're on to something there. We have to get patients to a certain level of pain that’s meaningful enough so they can randomize.

Sure and then just sticking with that idea of the measure of whether its pain or the primary endpoint that you're looking at, can you give us an idea on the UP side, what the sort of relative measure is for itch that you are using for the actual study that's underway?

Yes there's -- you're right Ken it’s still a subject’s measure, so it's a visual analog scale and that we’re interested in worse itching scores in these subjects at a two week time point versus their baseline entry scores. That will be the primary endpoint.

So was there any sort of limitation on enrollment in terms of they had to be 40 on a 100 scale or a 60, is there any sense for that on a screening criteria?

Yes there is, we actually have a run in period where the worse itching scores has to be on average above a certain level and it's believe it's 4 out of 10 on a vast scale over, I believe it's a one week run-in period for that trial.

Thank you. Our next question comes from Chiara Russo of Janney. Your line is open.

Just sort of some quick housekeeping questions. You said on the Phase 3, you said it they were going to stagger in their start did I get that right? One is going to start second quarter probably that bunionectomy and the other two were going to be later in the second half?

That's correct I mean if I ran the world and all things were perfect they would all start at the exact same time. But the reality is that the one that's going to start first and fastest will be bunionectomy, but the plan is to get lap abdominal and lap hysterectomy as soon as possible after those. If anything we could get [Indiscernible] for sites right, because they are all different sites, different types of surgery.

And then for the oral Phase 2 that's also going to be starting second half of this year as well?

Possibly the first but this year -- yes in terms of completing our first Phase 2 trial, we think we're going to see data by the end of this year on those.

Thank you. And we do have a follow up from Mr. Charles Duncan of Piper Jaffray. Your line is open.

So on the Phase 3 for hysterectomy so repeat dosing is going to be on an interval over every six hours is that correct versus the Phase 2 where it's an appropriate pain score. So is that a change from the Phase 2 to the Phase 3?

Actually, [Roy] the -- yes you're correct that dosing is going to be [queued six hours] for the lap-hys trial, I think you're mixing up your bunions and your hysterectomy there, the hysterectomy Phase 2 was QAPRN and that's also going to be Q6 in the Phase 3.

Thank you. And we do have a follow up from Ms. Annabel Samimy of Stifel. Your line is open.

Just a quick question on the [indiscernible], I know that this is the stuff that's [indiscernible] past, but can you remind us how you got comfortable with quote-unquote owning the final upper files during the surgery after switch to the per [indiscernible]?

Sure because in hysterectomy the previous Phase 2 trial and you said that you own all adverse events as soon as you dose drug and as soon as you randomize the patients. In our experience with 200 person lap hysterectomy trial already tells us that we are able to own any of those issues that happened intraoperatively, whether it's fluid shifts or the anesthetic gases that are used, intravenous opioids that are used and they can still come out of that procedure get another dose of drug after they can randomize and still get another dose of drug and we can still demonstrate efficacy which we've done as well as safety as well as, as I think the most important thing is the reduction in nausea and vomiting and so that's how I'm very comfortable with it and it also make sense that's how I used to operate or that's how I used to deliver anesthesia when I was in the O.R. So it makes total sense to do it that way, that's how it will likely be done in the real world. It's how these types of drugs [indiscernible] as an example are dosed in the real world now and it's the best way for us to demonstrate efficacy, it's our best as I said shot at separation from placebo.

Thank you. At this time I don’t see any other questions in queue. I'd like to turn the call back over to management for any closing remarks.

Great, thank you and thank you everybody for calling in today and we look forward to updating you on all these clinical development programs in Q2, so thanks again. Take care.

Ladies and gentlemen this concludes today's presentation. Thank you once again for your participation. You may now disconnect. Everyone have a great day.