Good afternoon and welcome to the Cara Therapeutics Second Quarter 2016 Earnings 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 Michael Schaffzin with Stern Investor Relations. And welcome to Cara Therapeutics second quarter 2016 earnings conference call. The news release with our second quarter financial results and corporate update became available at 4:01 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 the company’s clinical trials and the reporting of clinical trial results, the potential results of ongoing and planned clinical trials and future regulatory and development milestones for the company’s product candidates, the company’s expected cash reach. Because 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 the Cara Therapeutics filings with the Securities and Exchange Commission, including the risk factors section of the company’s annual report on Form 10-K for the year ended December 31, 2015 and its other documents subsequently filed with or furnished to the Securities and Exchange Commission. All forward-looking statements made on today’s call speak only as of the date on which they are 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.

Thank you, Michael. Good afternoon, everybody. Thanks for being with us on the call. I’m joined today by our Chief Medical Officer, Dr. Joe Stauffer; and our Chief Financial Officer, Joe Schoell. So the first-half of 2016 has been very productive for us here at Cara. This past quarter alone we resumed patient recruitment in our adaptive Phase 3 trial in postoperative pain, initiated a second late-stage trail in CKD associated pruritus and completed preparation for initiation of a Phase 2b trial in osteoarthritis patients beginning in Q3. Joe will provide more color on these clinical trials. But, first, I’ll walk through a higher level overview and expected news flow for the next few quarter. In June, we were very pleased to resume our adaptive Phase 3 trial of I.V. CR845 in postoperative pain. Enrollment in the study since reopened continues to trend positively. Right now, we have 16 sites active and we expect to reach approximately 25 sites by the end of this quarter. In late June, we were also pleased to initiate our adaptive Phase 2/3 trial of I.V. CR845 in dialysis patients suffering from moderate-to-severe uremic pruritus. As we touched on in the past call, uremic pruritus is an intractable systemic itch condition that occurs with a greatest frequency and intensity in chronic disease kidney patients under hemodialysis or peritoneal dialysis. The majority of dialysis patients, approximately 60%, report pruritus with 30% to 40% reporting moderate-to-severe pruritus. There is currently no approved therapy in the United States and traditional itch medications such as antihistamines and corticosteroids have proven ineffective for these patients. We currently have 11 active sites enrolling for this trial and we expect that to reach 25 by the end of this quarter. So the initiation of this trial is certainly an important milestone and…

Thanks, Derek. As Derek mentioned, we are pleased to have resumed enrollment in our adaptive Phase 3 trial of I.V. CR845 for post-operative pain and initiated our adaptive Phase 2/3 trial of I.V. CR845 in dialysis patients suffering from moderate-to-severe uremic pruritus. As we discussed last quarter, based on interim efficacy signals for pain and supplemental opioid use and opioid-related side-effects observed from interim analysis of the first 90 patients previously enrolled, the adaptive Phase 3 trial in post-op pain is continuing as a three-arm trial testing 1 microgram per kilogram and 0.5 microgram per kilogram of CR845 versus placebo in up to 450 patients undergoing various abdominal surgeries. The primary efficacy measure is the change in pain intensity over the 24-hour post-op period using the patient-reported Numeric Rating Scale score collected at pre-specified time-points through 24 hours. Postoperative nausea and vomiting will be evaluated as a secondary efficacy measure. The trial still accommodates an interim assessment for conditional power across doses at approximately 60 patients per group, and with an adaption to optimum dose and subsequent progression to complete enrollment. Turning to our Phase 2/3 trial in uremic pruritus, this is a two-part design. Part A is a randomized double-blind placebo controlled study of three doses of I.V. CR845, administered three times a week after dialysis over an eight-week period in 160 patients. Part B will be a randomized double-blind placebo-controlled study of one optimized dose of I.V. CR845, administered three times a week over a 12-week treatment period in up to 240 patients. The primary endpoint will be reduction in worst itching scores from baseline values, measured on a standard Numeric Rating Scale alongside secondary quantitative quality of life endpoints measured on the validated Skindex-10 scale and complementary QoL measurements. In addition to the I.V. trial in uremic…

Thanks, Joe. And as a reminder the full financial results for the second quarter can also be found in our press release issued today after market close. We reported a net loss of $13.1 million or $0.48 per basic and diluted share for the second quarter of 2016 compared to a net loss of $5.7 million, or $0.25 per basic and diluted share, for the same period of 2015. We recognized $79,000 of revenue during the second quarter from the sale of clinical compound material to Maruishi. For the second quarter of 2015, collaborative revenue was $874,000, comprising revenue that had been deferred upon entry into the license agreement with Maruishi. R&D expenses were $10.8 million in the second quarter compared to $4.7 million in the same period of 2015. The higher R&D expenses in the second quarter of 2016 were principally due to a net increase in direct preclinical study and clinical trial costs, consulting services and support of the studies and clinical trials, and an increase in payroll and related costs for R&D personnel, the acceleration of amortization of the leasehold improvements at the company’s Shelton, Connecticut facility prior to the relocation of the company’s corporate headquarters to Stamford, Connecticut in May of 2016 and increased rent, including rent expense for the Stamford lease for the second quarter of 2016 and the remaining rent payments due for the Shelton lease through its term. General and Administrative expenses were $2.6 million in the second quarter of 2016 compared to $1.9 million in the same period of 2015. The increase in the second quarter of 2016 was primarily due to increases in payroll and related costs, franchise taxes and in rent and the acceleration of amortization of leasehold improvements, as previously noted. Other income was a $172,000 of interest income…

Okay. Thank you. [Operator Instructions] And our first question comes from Annabel Samimy from Stifel. Your line is open.

Question, I was hoping that you could provide some clarification on the - on several of the studies actually. On the I.V. 845 study, did you say that there was going to be another optimization of the doses or did I misunderstand, because I thought that the whole idea with the first part of the study was optimizing to find the right dose?

You’re correct. So the first part of the study was to find doses that we could take forward into the second part of the study. And that first part was due to safety only. If you remember, at that point we only had - we were only targeting about 30 patients per arm. We took to look at 20 patients per arm. It was purely for safety and that was pre-specified. Now, that we’re down to a placebo and two-arm trial. We still have a pre-specified interim assessment look at around 60 to maybe 65 patients per arm, for conditional power for efficacy. So this is always preplanned from the beginning of even the Phase 2 portion of the trial and we will do that. And then based on the outcome of that conditional power, we’ll then make an assessment for which doses we take forward or not.

Into Phase 3?

Right, we’re in Phase 3 right now. So this is a Phase 3 trial as it stands.

Right, but you still need another study?

Correct, yes. We’ll need another placebo-controlled trial to replicate this trial.

Right, so you have no expectation to take more than one dose into the next Phase 3 study. You’re going to identify what that doses that you need right here in this part 2 and then you’re going to move and take that dose into the next Phase 3 study?

Right, it will be at least one dose. Sometimes, depending upon the spread between the lowest dose and the highest dose, we might actually take two, but really we have to make that decision once we get the interim assessment.

Okay. And so should I assume the same is being done for the uremic pruritus study as well, because I notice there was a part A and part B?

Right, for the uremic pruritus study, in that case, we’re only going to take forward one dose.

Into what, into the optimization…?

Into the longer portion. Correct into the optimal…

Into the part B?

That’s correct. Into the optimization phase with part B.

Okay. And then, after that you need another Phase 3 study correct?

Correct.

Okay. All right, and then finally, for the oral doses you - I don’t think you mentioned which doses you’re taking into the Phase 2b.

Right, we haven’t mentioned those doses. But they will be out on ClinicalTrials.gov. You’ll be able to see - it will be three doses of drug, dose BID versus placebo. And then, you’ll see those very quickly once we get the trial starting dosing.

And, Annabel, as we said earlier it’s based on the results from our Phase 2a study. So they will include tablet strengths up to and include the 5 mg tablet strength that was our top dose in the Phase 2a trial.

That’s correct.

Okay, all right. Great, and sorry, you didn’t mention that, when some of the data releases will come out correct. You just said that that when you have a better idea of how the enrollment is proceeded, then you’d be able to tell us the timing.

Absolutely, yes, once we see the enrollment rates in the next two quarters then, I think, we’ll be in a position to more accurately guide on data readout.

Okay. Great, thank you.

Thanks, Annabel.

Okay. And our next question comes from Charles Duncan, Ph.D. from Piper Jaffray. Your line is open.

Hello, this is Sarah on for Charles.

Hi, Sarah.

So I have two questions. Hi, the first time I’ve noticed you’ve had a presence at a lot of recent medical meetings, American Pain, Opioid Conference. Just going to ask what kind of feedback you’ve been getting at those meetings. And then, along those lines, just qualitatively how is enrollment been going in that acute pain trial…?

Sure, so I’ll take that. So, we’ve had a busy early part of the summer and late spring with meetings. I think the feedback was actually terrific. We are invited to present at Harvard at the International Conference on Opioids and that was quite exciting, and same thing for the various congresses that we do in the late spring. There is always interest I think, because this is a novel compound and an unmet medical need both preoperatively as well as chronically. So the interest comes from practitioners, as well as patients too. On the other - I think the other part of your question was about enrollment. We’re meeting our expectations right now, which is great. I think that we’ll know better, once we’re really into the thick of enrollment, how we’re doing and as Derek said, then we can update you in that score.

Okay. Thanks. And just one other on the Phase 2b, the oral compound, I mean…

Yes. Sorry about that. Yes. One more piece on that and I didn’t really mention this. It’s the nonabusable piece. It is really starting to get a lot of attention with people. Before it was really about kind of the ease of use and the side effect decreases that we can get with the drug, primarily for nausea and vomiting post-operatively. But as we’re moving into the oral dosing of the drug in osteoarthritis, I’m getting a lot more feedback and questions about the abusability of the drug, which is great for us, because we already have the human abuse liability trial out there. So we feel pretty good about that.

Yes. It makes sense. And then, my question was just about the Phase 2b with oral compound. I mean, just curious so if you can talk about what you would see as a win from that trial, is it identifying a dose to move forward or seeing activity on multiple markers?

Right, so, it’s a good question. So this is a true proof-of-concept trial, we’ve got three doses of drug versus placebo. At the very minimal, we just need one of these doses to work. And if one of these doses works well and gets us the P value that we’re looking for as well as other safety measures, as well as good patient tolerability that’s a win for us. Based on that data, we’ll take that into the FDA for an end of Phase 2 meeting for discussions on the Phase 3 program.

Okay. Thanks.

Thanks, Sarah.

Okay. And our next question comes from Ken Trbovich from Janney. Your line is now open.

Thanks. I guess my first question, Joe, you kind of touched on this earlier with regard to sort of the reference to the clinical trial and the timing for completion. I just wanted to clarify. You mentioned the interim analysis for the I.V. post-surgical pain study. Is that after 60 patients total or 60 patients per arm?

It’s about 60 patients per arm, so maybe about 180 total.

Okay. And from that perspective, if I look a ClinicalTrials.gov it looks like that trial at least according to that source, you’re suggesting the trial is expected to be completed mid next year. Is there a reason why that wouldn’t be an accurate or reliable data or can you give us some color on that?

Well, we have to put in an approximate data when the trial could end. It could end sooner than that. It could end later than that. A lot of it just depends upon enrollment. You remember the part of the interim assessment that we have, is we can actually increase the sample size, if we had too.

Sure.

And right now, we are targeting 120 per arm. But we could actually keep the sample size where it’s at or even go lower. If indeed the interim assessment tells us that we’ve got a robust signal in at least one of the treatment arms.

Okay. And would that mean then that we should at least have comfort that we’ll see the interim prior to that middle of next year kind of timeframe?

I think that’s fair. Yes.

Okay. And then, just a follow-up question with regard to the UP side on the I.V. formulation, there isn’t - as you noted there is not a record in ClinicalTrials.gov. Are all those, there is U.S. centers or any of them ex-U.S. or North American?

Everything is U.S.

Okay. And then with regard to the centers or some them involving the major - the sort of the two major providers on the service side?

Yes.

Okay. And then just last question with regard to the Oral and the I.V., is it too early to talk about strategy there in terms of whether you would simply do a bridge or whether you would actually conduct the confirmatory UP study even in Oral as opposed to the I.V.?

Ken, that’s a terrific question. And you’ve identified why we are looking at both formulations. So little too early for us to determine which formulation carries forward, as you know from the reimbursement standpoint the Oral is essentially free and clear, in terms of being out west the bundle at that point, at least the 2024. But there has been some precedence recently of novel I.V. compounds attaining a reimbursement status out west the bundle at least for a limited for time. And that’s something we’re interested in and something we’re looking at, so you’re perfectly correct. I think it’s a little early to determine which formulation we move forward with and it may well involve a bridging study from one to the other at the end of the day.

Sure. Thank you. And then last question for, Josef, on the financial side. Could you quantify for us how much of the sort of R&D and G&A costs were associated with the non-recurring relocation of headquarters?

The relocation was all non-cash base. It’s only amortization and liabilities being set up.

No, I understand that, but I’m just trying to get a sense for how much of the total OpEx expense was associated with that non-cash component?

Between the two, close to $2 million and you will see that in the 10-Q filing. Will be at least a footnote that describes - the biggest part of that is really the recording of a liability for all of the future payments on the Shelton lease obligation.

Okay, terrific. Thanks so much for taking the questions.

You’re welcome.

Thanks, Ken.

Thanks, Ken.

Okay. And our next question comes from Alan Carr, Ph.D. from Needham & Company. Your line is open.

Hi guys, this is Danielle on for Alan. I just…

Hi, Danielle.

Hey, I just wanted to clarify a bit more on this interim look for the I. V. pain study. Will you be updating us with results around the interim or will we not hear anything until final data?

No, we’ll let you know that we’re moving forward or not based on the results of the interim. We won’t go into all the details of what exactly we see, because we have an independent data monitoring committee that’s guiding us there. So you will know and - we will know and then you will know. And then we’ll put out there on ClnicalTrials.gov how we’re moving forward, how many doses are left and what that sample size will be if we have to increase the sample size or decrease the sample size. So that’s what we’ll know and that’s what we’ll tell you.

Okay. And that is what we can expect mid next year?

Correct.

All right, great. Thank you.

Or earlier depending upon how things enroll.

Great. Got it.

And your next question comes from Chiara Russo from Cantor Fitzgerald. Your line is open.

Yes, great. Hey, guys, thank you for taking the question. Just some sort of housekeeping questions around the Phase 2b and osteoarthritis pain. I was curious, if you have any more details around like the inclusion period, the inclusion criteria for those patients. Is there a washout period? How is that data going to be collected and have you publicly disclosed too that CRO is running those trials?

So we have not publicly disclosed the CRO. That’s the answer to your first question. The second - or the first question was what kind of patients do we have? They’re the exact same type of patients that we had in the Phase 2a. So these are patients with OA in their hip or knee. And in general, they tend to be a little bit older than, say, low-back patients on average than the previous patients that we did. I think the average age was around 63 or 64. And, yes, there will be a washout period. Just like we did in the previous trial, we don’t want to have these patients on any of their NSAIDs or COX-2s or any episodic opioids or any other drugs that they’re taking for pain. So we wash them out and they have to have a base-line pain score that qualifies them to get into the trial. They have to have moderate to severe pain on the pain scale before they can come in after their washout.

Okay. And remind me again what the primary endpoint on that one is going to be?

So it’s the - if you use the zero to 10 Numeric Rating Scale and we’re looking from change from baseline to final, over eight weeks.

Okay, okay, so just base line to final, okay, okay.

Correct. And then we have secondaries as well. We have - Chiara we have PGA and the WOMAC as well, pain stiffness and function is part of the WOMAC, and there secondary endpoints that we look at.

Okay, and for the I.V. in post-op pain. I’m assuming you also have a rescue medication to open there as well?

That’s correct. So we use morphine as a rescue and for patients that can tolerate morphine IV, then we also allow other rescue opioids IV and equianalgesic doses to morphine, for instance, hydromorphone.

Okay. Does that all skew the results on nausea and vomiting, because obviously morphine and other rest of those tend to show off more of that side effect?

No, in fact, the beauty of this kind of trials is the placebo-arm, right. So we get to look at what the nausea vomiting signal is in the placebo arm as well. And if you remember from the hysterectomy trial, we can reduce nausea, vomiting above and beyond what we see in the placebo arm even when they’re on opioids.

All right, that’s what I needed to know, awesome. Thank you.

All right, yeah.

Thanks, Chiara.

Okay. And our next question comes from Jim Molloy from Laidlaw. Your line is open. François Brisebois: Hi, thanks for taking the questions. This is actually Frank on for Jim. I was just wondering is it so, I guess, it depends on enrollment, but is it fair to expect the data for about mid 2017 for the Oral CR845 for OA if any?

I think you said it right. It depends on enrollment. I’ll give you a better answer on that. I think once I’m into it next quarter, because have a better sense of how the sites are doing, who is delivering, who is not in terms of quality of patients, speed of enrollment that type of thing. So for now we have it as next year. It could be sooner. It could be later. Again, I’ll know better. I can give you a clear answer once we’re immediate into enrollment. François Brisebois: Sounds good, and then, in terms of the I.V. CR845 for post-op pain, having dropped the 2 and 5 microgram kilogram doses. Can you talk more about mechanistically like the similarities that would help us predict positive results between the 1-microgram-pick in UP and in post-op pain?

Yes. So our singles that we had in those first 90 patients, we had some nice efficacy in that trial with the 1 microgram per kilogram dosing. And we’re confident that it’s pharmacologically active. We know this as well from the itch trials too. In fact, that’s why we even chose a lower dose as part of this trial as well. I mean, if you guys remember from the base of pharmacology, this drug is very, very potent, and it’s like 300 picomolar at the receptor. And so again, we’ll know once we get that interim assessment how robust it is, but we’re pretty confident that we will see something at least in one of those doses. François Brisebois: Sounds good, that’s it for me. Thank you.

Thank you.

Thank you.

Okay. And I am showing no further questions at this time. I’d like to turn the call back over to Mr. Derek Chalmers for closing remarks.

Okay. Thank you everybody for participating in today’s call. And we certainly look forward to updating you again very soon next quarter. Thank you very much.

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