TXMD Q3 2013 Earnings Conference Call

TherapeuticsMD, Inc. 8-K

TXMD Q3 2013 Earnings Conference

Wilson - In-Site Communications - Investor Relations for TherapeuticsMD, Inc.

Cartwright - TherapeuticsMD, Inc. - Chief Financial Officer

Finizio - TherapeuticsMD, Inc. - Co-Founder and Chief Executive Officer

Samimy - Stifel Nicolaus - Analyst

Cali - Noble Financial Group - Analyst

Livnat - Jefferies - Analyst

Hsieh - Cowen - Analyst

you for joining us this afternoon for TherapeuticsMD's third quarter 2013 financial results conference call. I'm Lisa Wilson of

In-Site Communications, Investor Relations for TherapeuticsMD. With me today are Rob Finizio, Co-Founder and Chief Executive Officer,

and Dan Cartwright, Chief Financial Officer of TherapeuticsMD.

now you should have received a copy of our press release issued today after the close of market. If you have not received it,

you may access it through the investor relations section at our website.

we get started, I would like to remind everyone that any forward-looking statements made during the call are protected under the

Safe Harbor of the Private Securities Litigation and Reform Act. 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 and

quarterly 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.

telephone replay of this call will be available shortly after the call's completion through Monday, November 18th; you'll

find the dial-in information in today's press release. The archived webcast will be available for 30 days on the Company's website

at TherapeuticsMD.com.

the benefit of those who may be listening to the replay or archived webcast, this call was held and recorded on November 4th

of 2013. Since then, TherapeuticsMD may have made announcements related to the topics discussed, so please reference the Company's

most recent press releases and SEC filings.

that, I'd like to turn the call over to Dan Cartwright.

Lisa, and good afternoon everyone.

the three months ended September 30, 2013, net revenue was $2.3 million compared with net revenue of $1.0 million for the three

months ended September 30, 2012. The increases were directly attributable to a combination of increases in the number of physicians

writing prescriptions for our products, the productivity of our sales force, the average net sales price of our product, and the

new prescription products introduced in March, April, May and November 2012.

of goods sold increased by $342 thousand, or 111%, for the third quarter of 2013, compared with the prior year quarter.

and development expense increased to $4.1 million for the third quarter of 2013 compared with $1.7 million for the third quarter

of 2012, because of the costs incurred in the development of our hormone replacement therapy product candidates, including the

initiation of two clinical trials.

general and administrative expenses increased to $4.8 million during the third quarter of 2013 compared with $ 2.9 million for

the third quarter of 2012.

a result, our operating loss was $ 7.2 million for the third quarter of 2013 compared to $3.9 million for the third quarter of

non-operating expense increased by $93 thousand for the third quarter of 2013 compared with the comparable quarter in 2012. This

increase resulted primarily from the amortization of financing costs of $448 thousand offset by interest expense and loss on extinguishment

a result, net loss for the third quarter of 2013 was $7.7 million, or $0.06 per basic and diluted share, compared with a net loss

of $4.3 million, or $0.04 per basic and diluted share, for the third quarter of 2012.

and cash equivalents were $59.6 million at September 30, 2013 as compared to $34.4 million at June 30, 2013 and $1.6 million at

includes approximately $30.4 million that we raised during the quarter through the sale of 13,750,000 shares of our common stock

at $2.40 or $2.23 per share net of underwriters discounts. We are pleased to have welcomed new institutional investors through

this underwritten offering.

that, I'll turn the call over to Rob Finizio to discuss the business in greater detail.

Thanks, Dan and welcome to TherapeuticsMD's inaugural earnings call. I'm pleased to report the growing

revenues from our legacy prenatal nutrition products and the progress we are making to advance our pipeline of innovative

therapy candidates. I'm going to touch on our strategy behind the current business and then discuss our growth opportunity.

current revenue growth stems from our prenatal business. The key element here is that the vitamin business has enabled us to develop

infrastructure that will be crucial to launching our hormone therapy products going forward. Our reps are building strong relationships

with the OB/GYN community, which is key call-point for our hormone therapy products, assuming clinical success and regulatory

approvals. Our robust sales and distribution network is recognized and respected by payers, physicians and patients alike. The

prenatal business has also enabled us to build a brand recognition and trust with women.

focus of our business is hormone therapies, an area that has largely been overlooked for close to a decade. Today, there is growing

medical consensus about the value of bio-identical hormone therapy. I'm going to go through our pipeline regarding the hormone

therapy candidates under development.

expect the first NDA we will file to be for 12-002, our low-dose oral progesterone candidate for the treatment of secondary amenorrhea.

This is the cessation of menses for 3-6 months or more in otherwise healthy women that once had a period. To reverse this condition,

the OB/GYN will use an estrogen primed, progesterone challenge test. In a positive test, a withdrawal bleed usually occurs two

to seven days after the challenge in the second cycle, and the Agency looks for complete secretory change following a biopsy in

candidate is a lower-dose natural progesterone, delivered orally. Unlike the market leader, Prometrium, which uses micronized

progesterone suspended in peanut oil, we are using solubilized progesterone, which has demonstrated several benefits including

a lower first-pass effect, lower blood levels, less metabolites, and a 25% increase in bioavailability. It is also non-allergenic,

because we removed the peanut oil.

PK trials, our candidate at the 150 mg test dose was found to be bioequivalent to a 200 mg dose of Prometrium. We believe our

solubilized progesterone is behind this important attribute, and we are seeking to establish that our 300 mg dose is clinically

equivalent to that of the 400mg dose of Prometrium.

are on track to initiate a phase 3 clinical trial, called the SPRY trial, this quarter. It will enroll 180 women with secondary

amenorrhea, randomized into three equal arms. In the two treatment arms, subjects will receive either the 225mg dose, or the 300mg

dose. The third arm will be placebo.

endpoints are withdrawal bleeding and complete secretory change. I'll give more details once we initiate the trial. Assuming

we are up and running this quarter, we expect to announce data by the end of 2014 and file an NDA by the end of 2014, or at the

latest very early 2015, again assuming positive results.

next candidate is 12-001, our combination product, it's an investigational drug that combines bio-identical

hormones - 17 -estradiol and progesterone into a single dose. We believe our novel combination of solubilized, natural API

may provide a safer and more effective alternative compared to current products, as they are the same molecular structures as

the body naturally produces.

benefits of progesterone over progestins has been established in numerous clinical trials. These include a more favorable profile

for breast cancer, cardiovascular disease, lipid side effects, and improved carbohydrate metabolism, as well as improved sleep

benefits of estradiol over conjugated equine estrogen has been making headlines. Over the last 2 months, publications in peer

reviewed journals including JAMA have highlighted that treatment with oral conjugated estrogens was associated with a higher incidence

of venous thrombosis and myocardial infarction. Conjugated estrogen use when combined with Medroxyprogesterone Acetate, also known

as MPA, showed breast cancer risk persisted for 13 years after discontinuation of use.

the third quarter, we initiated the REPLENISH Trial, a pivotal phase 3 clinical trial to measure the safety and efficacy of 12-001

in treating the symptoms of menopause.

enrollment is underway, and we continue to add locations throughout the country. We have a target of around 50 centers in the

US. We are about half-way through enrollment of the centers and are extremely happy with the progress thus far.

endpoints of the REPLENISH Trial include a reduction in frequency and severity of hot flashes over a 12 week period, and a reduction

in the incidence of endometrial hyperplasia, for one full year, which is a key concern for women with an intact uterus with estrogen,

and in accordance with FDA's Guidance for Estrogen and Progestins.

terms of timing, we aim to conclude the REPLENISH Trial and announce data by the end of 2015, followed by an NDA filing with the

FDA, again assuming positive results.

to our 12-004, our estradiol VagiCap candidate, which we are developing for the treatment of vulvar and vaginal atrophy, also

is a condition triggered by the decrease in estradiol that occurs after a woman's hot flashes have stopped and a new lower

estradiol level has been established in the body. If untreated, the symptoms get worse over time and continual therapy is required.

Lower estradiol levels cause a reduction in superficial cells in the vagina and an increase in parabasal cells as well. Additionally,

the vagina changes from acidic to basic as seen by an increase in pH. According to NAM, the North American Menopause Society,