Good afternoon, and welcome to Cara Therapeutics Second Quarter 2017 Financial Results Conference Call. All participants are now in listen-only mode. [Operator Instructions] 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 morning, this is Michael Schaffzin, Stern Investor Relations and welcome to Cara Therapeutics second quarter 2017 financial results and update conference call. A news release with our second quarter financial results and corporate update became available just after 4:00 PM today and can be found on our website at www.caratherapeutics.com. You may also listen to 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 include statements concerning the expected timing for future interactions with FDA and regulatory filings with FDA regarding our development programs, the timing of the completion and announcement of the results of our ongoing clinical trials, the expected timing of our planned clinical trials. The ability of our clinical trials to demonstrate an extended patient benefit, potential for CR845 to be a therapeutic option in multiple pruritus indications, potential benefits of breakthrough therapy designation. Future regulatory and development milestones for our product candidates, the size of the markets that are potentially addressable by our product candidates and our expected cash reach. Because such statements are subject to risk 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 Factor section of the company’s annual report on Form 10-K for the year ended December 31, 2016 and its other documents subsequently filled 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 whether as a result of new information, future events or otherwise except as required by law. Now let me turn the call over to Cara President and CEO, Dr. Derek Chalmers.

Thanks Michael. Good afternoon, everyone and thanks for being with us on the call. So we certainly made significant progress across all of our pain and pruritus development programs during the second quarter and we will summarize that progress and then talk about upcoming milestones on the call this afternoon. Starting with I.V. CR845 for acute post-operative pain, in June, an independent data monitoring committee completed a pre-specified interim conditional power analysis of our adaptive Phase 3 trial in patients with acute post-surgical pain. The committee revealed that both doses being evaluated in that trial were generally well-tolerated and based on their conditional power analysis, the trial continues to test both doses versus placebo in up to 450 patients. We anticipate completing enrolment later this year and enhancing top line data thereafter. Recently, we also had two significant events in our CKD pruritus program that underscore CR845’s potential in this indication and also laid the groundwork to expand this clinical application into a broader patient population. In June, I.V. CR845 received breakthrough therapy designation from the FDA for the treatment of moderate to severe CKD associated pruritus in patients undergoing haemodialysis. As a remainder, breakthrough designation is granted to companies to expedite the development and review process for new therapies addressing serious or life threatening conditions where preliminary clinical evidence indicates that the drug candidate may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints. Basically, this allows the FDA to potential expedite CR845 development process in these patients and we will be discussing the complete pivotal program in that context in our upcoming end of Phase 2 meeting with the agency planned for this quarter. There are currently non approved therapies in the U.S. for CDK associated pruritus and the FDA’s decision to grant breakthrough…

Okay thanks, Derek. I’d like to start with some of the recent developments from our pruritus program. In July, we reported summary data from the three-part randomized placebo controlled study to evaluate the safety and pharmacokinetics of our Oral CR845 tablets in 90 hemodialysis patients. In part A, ascending repeated oral doses of 0.25, 0.5, 1.0 and 2.5 mg were given to 4 cohorts of patients after each dialysis session over a 1-week treatment period. In part B, patients were given the same ascending doses daily. Finally, in part C, the final crossover phase of the study, patients were administered a single 1 mg oral dose of CR845 or a single 1 microgram per kilogram I.V. dose of CR845 given after hemodialysis with a one-week washout period between treatments to determine the absolute bioavailability of Oral CR845. We were pleased to identify oral doses that were comparable to clinically efficacious I.V. doses in this patient population and believe that this trial gives us a solid understanding of the appropriate dose range to advance into Phase 3 trials in CKD patients as well as to explore in other pruritic patient populations. In our I.V. pruritus program, we have also kicked off our 52-week safety study enrolling up to 240 hemodialysis patients with CKD associated pruritus who previously completed one of our Phase 2 trials. This open label trial will evaluate the long-term safety of I.V. CR845 at a dose of 0.5 microgram per kilo and will contribute to the safety exposure requirements for NDA submission. Moving along to our acute postoperative pain program, we expect to complete enrollment this year in our ongoing adaptive pivotal CLIN-3001 trial of I.V. CR845. As Derek mentioned, we were pleased to complete a pre-specified interim conditional power analysis of this adaptive Phase 3 trial in…

Thanks, Joe. As a reminder, the full financial results for the second quarter can also be found in our press release issued today after the market closed. We reported a net loss of $9.3 million or $0.29 per basic and diluted share for the second quarter of 2017 compared to a net loss of $13.1 million or $0.48 per basic and diluted share for the same period of 2016. We reported no revenue in the second quarter of 2017 compared to $79,000 of revenue during the second quarter of 2016 from the sale of clinical compound material to Maruishi. R&D expenses were $7 million for the second quarter of 2017 compared to $10.8 million in the same period of 2016. The lower R&D expense in the second quarter of 2017 were $7 million for the second quarter of 2017 compared to $10.8 million in the same period of 2016. The lower R&D expense in the second quarter of 2017 were principally due to a net decrease in direct clinical trial costs including a reduction of approximately $1.5 million due to a change in estimate relating to a clinical trial accrual that had been recorded in the first quarter of 2017 partially offset by an increase in payroll and related costs for R&D personnel. General and administrative expenses were substantially unchanged at $2.7 million for both the second quarter of 2017 and the same period of 2016. Increases in professional fees and public investor relation costs, stock based compensation and payroll and related costs were offset by decreases in depreciation and amortization expense and rent expense. Other income was $331,000 in the second quarter of 2017 compared to $172,000 in the second quarter of 2016. The increase in 2017 was primarily due to higher dividend and interest income resulting from higher interest rates on a higher average balance of the company’s portfolio of investments during the 2017 period. As of June 30, cash, cash equivalents and marketable securities totaled $112.4 million compared to $58.3 million at December 31, 2016. The increase in the balance of cash, cash equivalents and marketable securities primarily resulted from the net proceeds of $86.2 million from the company’s second follow on public offering of common stock and $1.4 million received from the exercise of stock options, partially offset by cash used in operations of $33.5 million. Turning to our financial expectations, based on timing expectations and projected costs for current clinical development plans, Cara expects that its cash, cash equivalents and available for sale marketable securities as of June 30, 2017 will be sufficient for the company to fund its operating expenses and capital expenditure requirements into 2019 without giving effect to any potential milestone payments under existing collaborations. And now, we will turn it back to the operator for Q&A.

Thank you. [Operator Instructions] And our first question is from the line of Charles Duncan with Piper Jaffray. Your line is now open.

Hi, this is Sarah on for Charles. Congratulations on the progress this quarter. First question, it’s just around the oral formulation for CKD associated pruritus, I had thought you were potentially going to move into a Phase 2 trial there, but it sounds like you are going to do some more Phase 1 work with non-hemodialysis patients, so can you just explain the strategy there?

Yes. Thanks Sarah. We are moving into a small open label Phase 1 trial so the data we have already analyzed in relation to oral bioavailability and exposure levels in hemodialysis patients who are obviously end stage with zero essential kidney function is going to help us model what we should take forward in terms of tablet strengths into stage 3 to 5. But we want to confirm that absolutely in a very small open label trial, which we will be starting a little later this year and then from that we will move straight into Phase 2 work.

Great, thank you. And then how should we think about R&D heading into the second half?

R&D in terms of expenditure?

Yes, expenditures?

It’s going to be flat.

It’s actually going to very comparable to what you have just seen in Q2.

Great. Thanks for taking my questions.

Thanks Sarah.

Thank you. And our next question comes from the line of Annabel Samimy with Stifel. Your line is now open.

Hi, guys. This is Andrew in for Annabel. Just a couple of questions, so just to follow-up on that Phase 1 taking the dose forward, do you envision taking all the doses forward or kind of how, where do you see the range falling in for that. And I have a follow-up question on the Phase 3 for the I.V., do you have any idea or sense of what trial design you are going to take forward or I know it’s safety [ph], do you see that yourselves taking it more adaptive approach and just like the prior program or if you are going into the pivotal Phase 3 and how many of them will you need for filing? Thank you.

So you are talking about the CKD first, is that what you are talking about the CKD patients, which doses?

Yes, for the oral, that’s my question?

Okay. Sure, right. So as I said there is four doses that we are looking at and this is a – it’s a Phase 1 trial in patients, so it’s actually a Phase 2 trial, but without looking at efficacy, right. We are just looking for a week to see how that looks and so we want to make sure that the doses in oral dosing that we have are still safe in these patients, right. So they are not on dialysis, but they are getting close to dialysis so depending upon what we see there, we could take one or all of them forward. It just depends upon which ones give us the best safety and PK profile, so I think that was the first part of your question. As it relates to the other part of your question, the I.V. pivotal Phase 3 trial, that trial is just a simple placebo controlled trial with one dose and that’s 0.5 microgram per kilogram or 0.5 microgram per kilogram dose given I.V. every other day after dialysis. And we will take that out to 12 weeks.

And will you need one or two Phase 3 studies for filing?

That’s part of the discussion we are having with the FDA. At some point we will get back to you and let you know what we find out from them once we have that meeting, which we anticipate coming up quite soon.

Got it. And last one, will this – I know you are, you said you were going to have that meeting, but will this be a three months study or kind of how do you envision the length of this study being?

The study will be a three months study, so it will be 12 weeks placebo controlled.

Thank you.

Thank you. And our next question comes from the line of Arlinda Lee with Canaccord Genuity. Your line is now open.

Hi guys. Thanks for taking my questions. So I guess from the top line on the OA trials, you guys had some interesting signals and I was wondering what might we see next to kind of follow-up on that and would the current trials do you think be enough to flush that out. And then on – and then I will follow-up with something on the pruritus too. Thanks.

Okay. Sure on the OA trial, I think we saw a number of things right, that clearly the 5 milligram twice a day dose seems to be a dose that works but it might represent the floor, not the ceiling. So it’s clear to us that we will probably have to take the dosing in the next trial higher and longer, right, so instead of 8 weeks, 12 weeks. That’s the first piece. The other thing that we learned and this is this convergent of endpoints part that Derek talked about, when we looked at that data in pre-specified analyses related to hips versus knees, we not only saw that we had a significant value in terms of the efficacy from the numeric rating score, but we also saw that in the presence of a reduction in Tylenol use, right. I mean that was coming along with about a 41% reduction in Tylenol use. That’s an important piece. There was also a very significant reduction in the patient global assessments. That was another secondary endpoint highly significant and quite important for us that also came with – back to the Tylenol piece or the acetaminophen piece, about 67% of the people didn’t need any rescue medication by the end. So all these are endpoints that are important that kind of fill in and paint a brighter picture for the effectiveness that we saw. Same thing in terms of the WOMAC score, which was another secondary endpoint, while that was not significant, it certainly trended in the direction. The overall improvement there was 62% from baseline. So when you put all those things together, not to mention a pretty clean safety profile and a tolerability profile, it tells me that this drug is working but that we likely need to push the dose higher and longer.

Okay. I guess – thanks very much. And then I guess on the oral to I.V. small bridging study, when might we get results from that and when might you be able to start the Phase 2?

Right so I mean, results as soon as we can and the Phase 2 is going to be this year, right. So I mean it’s going to start definitely by the end of this year for sure, but we have to complete this first study first, right.

Okay. Thank you. And then can you provide – maybe last question, are you going to be presenting at any medical meetings in the latter part of the year with some of the data that you have top lined already?

We are so we are going to be presenting our respiratory depression data, which was accepted actually it was one of only eight posters accepted for live presentation at the American Society of Anesthesiologists in Boston in October. That will be actually presented by one of the key opinion leaders who was part of that trial. We are also going to be presenting at Kidney Week, this data that we had in this Phase 2 data. That’s coming up I believe in November. We will also be presenting the oral osteoarthritis Trial at Pain Week and that’s in September. And there may be one or two other small what I call itch meetings, maybe even a dermatology meeting and perhaps another smaller kidney meeting as well.

Thanks very much.

You’re welcome.

Thank you. And our next question comes from the line of Ken Trbovich with Janney. Your line is now open.

Thanks. I guess I don’t know whether to ask Derek or Joe, I am trying to figure out if on the Phase 3 I.V. study for CKD-aP, it seems very, very clear you guys have had tremendous success in rapidly enrolling those studies. And the last study you were testing three doses and yet you got statistical significance with 174 patients, so can you help us maybe understand the difference between the size of the study that you need for efficacy versus the size of the patient population that you may need for approval, is there a way that you might be able to, for example, do a pivotal study of 100 patients, 150 patients and then do a larger, safety study to expand the database so that the pivotal study itself is faster to get to a data point or is that something that you think the FDA is going to want to see as part of the pivotal study?

Sure, so there is studies and then there is program, right, so from a study perspective we have to do a – we know we have to do a pivotal placebo controlled trial 12 weeks long. We will start that as soon as we can after our end of Phase 2 meeting. The current trial that’s enrolling gets to the overall program sample numbers that we are going to have to do and that’s just simply open label safety out to 12 months and that we are starting now but the only patients that we can get for that are patients that are rolling over from the study that we just finished, right. So we have to let only those patients enroll while we also start a placebo controlled trial at the same time later this year. So that’s the way that we get to the overall exposures we need for the program. We know that at worst we would need 1,500 total exposures, but because we got breakthrough, certainly we would anticipate that we wouldn’t have to have that many. We will find out exactly how many the FDA wants after our meeting.

But for purposes of the efficacy study, the pivotal efficacy study, the statistics from the part A suggest you could do it with 150 patients that you would have the powering necessary, is that crazy or ludicrous for us to look at you guys and say you can do 150 patients study and have it done in less than 1 year or is there something about that that we are missing?

It’s not crazy or ludicrous, but then there is reality. And the reality is that it does take time. These are sick patients. They are tough to enroll. They are not impossible. We have done it before. We know how to enroll. We know where to go, but nevertheless it’s still a new study and you also want to make sure that do have enough sample size. We are going out an extra month at this time, right, before we only went eight weeks. Now we are going 12 weeks. Our dropout rate is going to be higher for sure. The other piece is that we absolutely want to make sure that we nail not only the primary endpoint, but also the secondary endpoints too, right. They are important and you want to make sure that you are powered well enough for those. So we do believe we have got enough cushion there, but we also have to anticipate a higher dropout rate simply because we are going longer and we are getting more patients.

Makes sense, I appreciate it. Thank you.

You’re welcome.

Thank you. [Operator Instructions] And our next question is from the line of Francois Brisebois with Laidlaw. Your line is now open.

Hey guys. Thanks for taking the questions. Just a couple quick ones here, on the post-op I.V. CR845 what do we – what should we be looking to see, I guess it’s a two-part question, one is do you think enrolment should be ending fourth quarter, is that data also fourth quarter or is that more of a 2018 event for data and then what would you guys like to see in terms of the results here?

Sure. So I would love to see a positive trial, let’s start there. The enrolment will finish by the end of this year and depending upon how fast that goes, I mean remember that we always – in the lull of this summer and then as you get into kind of September and October enrolment picks up and then it tends to slowdown again right after Thanksgiving and so there is an ebb and flow to enrolment, but we have built that into our projections here, so enrolment for sure and maybe data by the fourth quarter, but it could go into the first quarter ‘18, it just depends upon how fast we can enroll it.

Yes. Francois, so we will have a much more accurate assessment on the Q3 earnings call.

Okay, great. And then just lastly, so when you guys – when the data safety committee un-blinded this for the interim look, they un-blinded but they don’t give you – I think you had used the word [indiscernible] details of it, how much read through from that in terms of, I get the safety, but in terms of efficacy is there anything at all that you can read through that interim look or are they just going to say the doses look fine, this is the end number you need and keep ongoing?

Correct. That’s all they really can give you, right. They are trying to keep us blinded to that. I mean we certainly have to know about safety. That’s the most important thing first. And I am looking at blinded safety all along during this trial, but blinded efficacy I can’t see it. It wouldn’t mean anything to me and so all we can do, that’s part of the charter, right. They tell us it appears to be safe, keep going. You could increase your dose or increase the amount of patients and that only helps us too because the more exposures we get, the better for the overall safety program.

Okay. And then lastly, in terms of the oral for OA pain, hip and knee, as you are speaking more with KOLs and as – are you guys are looking at the data more and more, any thoughts on why maybe this could have worked in hip and not knee or the placebo effect in knee was so much higher, any thoughts at all from the medical…?

Yes, that’s a really good question. In fact there is data out there to support what we saw on our trial. So if you look back over osteoarthritis trials in hips and knees and individual hip trials versus individual knee trials versus combined trials, there actually is a difference between the way that hip patients respond and knee patients respond and indeed knee patients tend to have a higher placebo response than hip patients using the same exact drugs, in this case and that’s exactly what we saw in our trial too. And on the top line response in terms of the active response, they are about the same, so this isn’t the first time that this phenomenon has been observed. And our key opinion leaders that looked at this told us the same thing and we are specifically talking to rheumatologists who treat this disease and rheumatology clinical trialists who have dealt with these types of trials in the past. So that gave me a little bit of comfort that what we saw was real. What we saw wasn’t the first time and it helps me also understand what we need to do going forward. I think clearly the recommendation from them was go higher, go longer, right, higher in dose I mean.

Excellent, alright. Well, thank you very much. That’s it for me.

Thank you.

Thank you.

Thank you. And this concludes our Q&A session for today. I will turn the call back to Mr. Derek Chalmers for his final remarks.

Thank you, Carmen and thank you all for participating in today’s call and we look forward to updating you again very, very soon. Have a good rest of the day. Thank you.

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