Jaguar Health, Inc. (NASDAQ:JAGX) Q3 2023 Earnings Call Transcript

It can cost from $0.5 million up to $1 million a year to take care of these patients and the resulting complications. There is a product approved for short bowel syndrome, which is called teduglutide. It’s not the standard of care, and it’s utilized in a small percentage of patients. It’s basically a growth hormone. And everything in the pipeline that we’ve been able to find in this category, is in the category of a growth hormone where you’re attempting to grow the gut a bit so that parental nutrition can be reduced by about 15% to 20%. And now you have an accepted regulatory endpoint. What we’re looking to do with Crofelemer is to decrease the secretions through a novel antisecretory agent to hit that regulatory endpoint of decreasing the need for parental nutrition by about 15% or 20%, as well as benefits stool formation.

As you can imagine, with a short gut, it’s like a sieve. What goes in comes right out. When we go back to the growth hormone approach, they also have no benefit in a situation where the gut is fully intact but not functioning, which is the case in several different congenital diarrheal disorders like MVID. The gut is fully intact, but there is intestinal failure. So, there’s nothing to grow. There’s no benefit of a growth hormone approach. And there’s other limitations with the growth hormone approach. For example, if the patient has cancer or risk of cancer or some abnormal hyper proliferative disease, you don’t want be giving a growth hormone. Patients recovering from surgery, which is the case for many of these patients, typically need 15 to 18 months for bowel adaptation where they can’t be administered a growth hormone.

Crofelemer should not have any of these limitations. We’re looking to have Crofelemer become the standard of care in the treatment of intestinal failure broadly, whether it’s due to short bowel syndrome or involves a fully intact gut, which seems to be about 50% of the market. Now, if we go back to cancer and our OnTarget trial, when we talk about prophylaxis for cancer therapy-related diarrhea, it’s important to note that cancer is the number one side effect associated with cancer therapy. If we think about an analogous situation, as I had mentioned with chemotherapy-induced nausea and vomiting, where there are agents approved, agents are typically used prophylactically for just the first three days in cytotoxic chemotherapy, as opposed to the chronic diarrhea that we’re talking about with these targeted therapies that patients are on often for the rest of their life.

But to go back to chemotherapy-induced nausea and vomiting, the market is expected to be valued at about $4 billion in 2029. And this is according to third-party market research, iHealthcare Analyst. And easily half of that market is priced and valued as a generic – there are generic products available. When we’re talking about prophylaxis for cancer therapy-related diarrhea, the targeted therapies that are taking long-term and chronically often for the rest of the patient’s life in a metastatic situation, we’re talking about a much more profound situation for number of patients and how long they can benefit. The standard of care for cancer therapy-related diarrhea is, believe it or not, to take the patient off their cancer therapy, or to go to a subtherapeutic dose, or to start at a subtherapeutic dose.

When we think about IMODIUM loperamide agents that you can get at the pharmacy, these are opioids and opioid-based, and you can’t use an opioid-based, such as IMODIUM and loperamide, on a chronic basis. They haven’t specifically been tested or approved for cancer therapy-related diarrhea. And when we think about a patient being taken off their cancer therapy, now we’re talking about an impact on the outcome of the cancer care. And in some cases, once you go off of therapy, you then have to move on to another one. So, you start to run out of options. One of the reasons why we designed the OnTarget trial as a prophylactic trial is to address the problem before it happens so the patient does not have to adjust their cancer therapy regimen, their life-saving cancer regimen because of diarrhea.

With the OnTarget trial, there are different aspects of the study that I think resonate with different audiences, different benefits. First, there’s the goal of supporting the comfort and dignity of patients, the supportive care aspect of preventing diarrhea in these patients that are on targeted therapy, and what could be more important than patient quality of life? That’s what it’s all about in the pharmaceutical industry. Next, though, there is a third-party study in fact authored by Dr. Pablo Okhuysen, who is also the national principal investigator for our OnTarget study. And his study indicates that patients with cancer therapy-related diarrhea are 40% more likely to discontinue their chemotherapy or targeted therapy than patients without cancer therapy-related diarrhea.

And that may be something that resonates loudly with the oncologists, as we mentioned, the opportunity for patients to stay on their cancer therapy and have an impact on the outcome of their cancer treatment. And then thirdly, there’s also an independent third-party study authored by Dr. Eric Roeland, a member of Napo Scientific Advisory Board, that shows that it costs about three times as much to take care of a cancer patient with diarrhea compared to a patient without diarrhea, due to the need for diarrhea-related visits to the hospital for rehydration, office visit prescriptions, certainly of interest to reimbursement organizations. So, these different aspects, these different potential benefits, patient quality of life, keeping the patient on their cancer therapy, cost, are all important.

They may have different levels of priority and recognition of importance with different audiences. The cancer treatment landscape has radically changed. We are in the age of targeted therapies and essentially most targeted cancer therapies work by a mechanism that induces the type of chloride ion channel diarrhea that is specifically addressed by Crofelemer. Crofelemer is novel. It’s a first-in-class antisecretory gastrointestinal chloride channel modulator, normalizer. Crofelemer normalizes gut function. There’s no agent that’s been specifically tested for this type of diarrhea. And when I say normalizes gut function, if a patient is in a normal situation and takes Crofelemer, nothing happens. So, it’s active and normalizing and providing its benefit in an abnormally active secretory situation, which occurs often in cancer patients on targeted therapy.