Good afternoon and welcome to the Trevi Therapeutics’ Q1 2023 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded.

Various remarks that management makes during this conference call about the company’s future expectations, plans and prospects constitute forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995.

Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of the company’s most recent annual report on Form 10-K which the company filed with the SEC this afternoon.

In addition, any forward-looking statement represent the company’s views only as of today and should not be relied upon as representing the company’s views as of any subsequent date.

While the company may elect to update these forward-looking statements at some point in the future, the company specifically disclaims any obligation to do so even if its views change. I would now like to turn the conference call over to Jennifer Good, Trevi’s President and CEO. Please go ahead..

Good afternoon. And thank you for joining our first quarter earnings call and business update. Joining me today on this call is Lisa Delfini, Trevi’s Chief Financial Officer. Lisa and I have some prepared remarks, then we will open it up for questions.

During the first quarter, we continued to advance our clinical development plans for Haduvio for difficult to treat patients with chronic cough in idiopathic pulmonary fibrosis or IPF, other chronic cough indications and prurigo nodularis. Let me provide an update on each of our programs. Beginning with our lead program in chronic cough and IPF.

IPF is a serious, end-of-life disease and chronic cough is a major cause of morbidity that significantly impacts a patient’s quality of life. There are no approved therapies for the treatment of chronic cough and IPF and the cough is often refractory to anti tested therapy.

Patients with chronic cough and IPF can cough up to 1500 times per day leading to fatigue, air hunger and increased anxiety. The chronic cough in IPF is also hypothesized to potentially enhance activation of pro fibrotic mechanisms and disease worsening.

We are planning to conduct two studies in parallel during this next phase of development in our IPF chronic cough program. The first is a Phase 2b dose-ranging trial that will study three active doses of Haduvio and placebo. The doses we are planning to study are 27, 54 and 108 milligrams BID.

We are planning for a total N in the study of approximately 150 to 200 subjects and dosing for approximately six weeks. We plan to conduct this study in multiple countries and sites to be able to complete enrollment in a timely manner. As you may be aware, there is a lot of development work going on with antifibrotics in IPF patients.

So, we expect that enrollment will be competitive, and we are planning for that scenario. We have finalized the protocol for the dose-ranging study and are preparing for various international submissions to regulatory authorities. We have also engaged our CRO and are in the final stages of country and site selection.

We are planning on initiating this study in the second half of this year. In parallel, we are planning for a Phase 1b respiratory physiology study. Opioids have a generic risk of causing respiratory depression.

This is not something we have seen in our safety data across our various studies to date, and there is literature that suggests that mixed agonist antagonists have a ceiling effect on the impact on respiration.

However, given the respiration impairment of the IPF population, it is important that we characterize to what degree, if any, are drug causes respiratory depression in this patient population.

Trevi is planning to conduct a Phase 1b inpatient study in IPF patients with cough that have varying levels of disease severity to determine if we see any clinically significant impacts on respiratory depression. This study will help define the patient population for our pivotal program and ultimately, the label.

We have received FDA feedback on the planned Phase 1b study and are finalizing the protocol and preparing for the IND submission. We expect to initiate this study in the second half of this year as well. In addition to the preparations in IPF cough, we are also developing a protocol for a Phase 2 study in refractory chronic cough also known as RCC.

We believe that because Haduvio works both centrally in the brain and peripherally in the lungs, Haduvio has the potential to provide therapy across a range of chronic cough indication regardless of what the underlying disease is.

We expect that this trial will look a lot like the CANAL trial, which was a dose escalating crossover design, and we expect to enroll approximately 60 subjects. There have been a lot of trials in RCC with only one mechanism, which has seen some success, the P2X3s, which mechanistically work peripherally in the lung.

However, we believe there is still a significant opportunity for a mechanism that works both centrally and peripherally and has the potential to provide strong and consistent efficacy in the most difficult-to-treat cough patients. We are leveraging the learnings from the prior development work in RCC by other companies as we design our own study.

Our cough data to date continues to garner a lot of attention at upcoming medical conferences with oral presentations of the data accepted at both the American Thoracic Society meeting beginning at the end of next week, as well as the American Cough Conference being held in June.

We have also finalized a manuscript on the CANAL trial results and have submitted it for publication. I think this speaks to the importance of the unmet medical need in these difficult-to-treat IPF patients and the medical community's interest in our program across cough indications.

The other indication where we have ongoing work is for the treatment of Prurigo Nodularis or PN, which is a serious and debilitating disease characterized by papules and nodules on the skin as well as severe itching. In June of last year, we reported positive data in the Phase 2b/3 PRISM trial and PN.

The trial achieved statistical significance on the primary and all key secondary endpoints. During the first quarter of 2023 we completed the one-year open-label extension study that was associated with PRISM.

We are currently analyzing the data from that study and will then seek an end of Phase 2 meeting with the FDA, which we expect to have later this year. After this meeting we will determine next steps for the program. Finally, we are conducting a human abuse potential study which is required for an NDA filing.

Note that the parenteral version of nalbuphine is currently unscheduled in the U.S. by the Drug Enforcement Agency or DEA. The objective of this study is to compare the likability or abuse potential of oral nalbuphine to an active comparator, which is butorphanol for this study. Butorphanol is a Schedule IV drug.

The study is being conducted in two parts with the objective for the first part to characterize the various butorphanol doses and choose a dose appropriate for comparison against oral nalbuphine in Part 2. We have completed Part 1 of the study and have selected the butorphanol dose for the second part of the study.

The second portion of the study is a randomized, double-blind, active and placebo-controlled five-way crossover design to determine the abuse potential of three doses of oral nalbuphine relative to the selected dose of butorphanol as well as placebo. There are two gating items to moving into Part 2 of this study.

The first is a nationwide shortage of butorphanol. We are working with our CRO partner to secure the doses we need to conduct the study. And second, we intend to submit the results from Part 1 of the study to the FDA for any comments on dose selection of butorphanol before proceeding with Part 2 of the study.

Assuming neither of these two items caused a significant delay, we expect top line results from the human abuse potential study by the end of this year. In closing, we are focused on execution to get these studies up and running.

We will announce studies as they are initiated and provide more details on the study design, expected time lines and the all-important name of the trial. I will now turn it over to Lisa to review our financial results, then we will open it up for any questions that you may have..

Thank you, Jennifer, and good afternoon, everyone. The full financial results for the three months ended March 31, 2023, can be found in our press release issued ahead of this call and our 10-Q, which was filed with the SEC today after the market closed.

For the first quarter of 2023, we reported a net loss of $6.4 million compared to a net loss of $7.3 million for the same quarter in 2022. R&D expenses were $5 million during the first quarter of 2023 compared to $4.6 million in the same quarter in 2022.

The increase was primarily due to increased consulting and professional fees related to start-up activities for the three planned chronic cough trials. This was offset by a decrease in clinical development expenses, reflecting the completion of both the blinded portion of the Phase 2b/3 PRISM trial and the Phase 2 CANAL trial in 2022.

G&A expenses were $2.6 million during the first quarter of 2023 compared to $2.4 million in the same period of 2022. The increase was primarily due to an increase in personnel-related expenses and higher tax professional fees.

Other income net was $1.2 million for the first quarter of 2023 compared to other expense net of $0.3 million in the same period of 2022. The change was primarily due to an increase in interest income. As of March 31, 2023, our cash, cash equivalents and marketable securities totaled $111.3 million compared to $120.5 million as of December 31, 2022.

Subsequent to the end of the first quarter, we elected to pay off our term loan early. The amount paid was $6.5 million and was previously classified as current on our balance sheet because the final payment was due in the first quarter of 2024 according to its terms.

The loan was with Silicon Valley Bank, now a division of First Citizens Bank, and it included restrictions related to keeping our corporate cash, cash equivalents and marketable securities either at or managed by SVB. Given the recent events at SVB, we wanted to free ourselves of these restrictions.

Our cash runway guidance remains unchanged since it had previously incorporated the paydown of the note in accordance with its terms. Accordingly, our cash, cash equivalents and marketable securities will enable us to fund our expenses into 2026. In the first quarter, we burned approximately $9 million of cash.

That included completing the clinical work on the PN open-label extension study and conducting Part 1 of the human abuse potential study.

Excluding the payoff of the term note, we expect cash burn to be between $10 million to $12 million per quarter for the rest of 2023 as we continue the human abuse potential study and initiate the IPF and RCC trials. This concludes our prepared remarks. I will now turn the call back over to the operator for Q&A..

[Operator Instructions] Our first question will come from Annabel Samimy with Stifel. You may now go ahead..

Hi. This is Stacy [ph] dialing in for Annabel. Congrats on the quarter and just a few questions on our end.

So the first is what was the rationale behind the decision to dose up to $162 million in the Phase 1b respiratory trial in IPF when the Phase 2b are at lower doses? Another has a level of interest by outside parties in your RCC significantly increased since the GSK acquisition of Bellus Health? And how has that changed any of your strategic thoughts around the indication?.

Yes. Okay. Thank you, Stacy, for the questions. So the Phase 1b trial, we're still finalizing the study design. Our current plan is to only dose to 108 milligrams. But that's some of the discussions that have been going back and forth with the FDA. So we think we only need to go to 108, but we'll see when we finalize it.

As far as the RCC indication, yes, I mean, we obviously got a lot of inbound interest, I think, I'm going to state the obvious, but GSK certainly validated the importance of cough as a market and the unmet need there. I think with refractory chronic cough as well, there's just not been a lot of success there.

You have the two players with the P2X3, so kept quite busy from an investor perspective. We already are in a lot of discussions around sort of which very strategic, actually I'll see several more over the next couple of months at conferences.

So yes, I think that got everybody's attention and certainly turn the light back on Trevi because I think, at that point we're the only stand-alone cough company once Bellus was acquired; so it was good news for us..

Amazing. Thank you. That's very helpful..

Thank you, Stacy..

Our next question will come from Serge Belanger from Needham & Company. You may now go ahead..

Hi. Good afternoon. Just one question for us today. I think you received a new patent for nalbuphine over the quarter.

So maybe just give us an update on the overall IP for the product?.

Yes. Thank you, Serge. Yes, it was an important patent for us. We have filed a broad application. So we have three layers of patent coverage. One is the formulation patents that have been in place for the product, those start to expire in roughly 2029.

So the primary coverage that will extend that is through method of treatment patents, and we have a big broad application that we filed around various neurological coughs. What we did was take the data from the IPF CANAL trial and actually pull out claims and prosecute a specific patent based on the dosing, the data, et cetera.

And that patent was issued. [Indiscernible] has helped us with that. We consider it to have broad claims in the patent. It goes to 2039 will be Orange Book listable. So that becomes really sort of the core of the protection.

On top of that, we also have filed others, what we call special population patents, data we've learned in the hepatically impaired population, the elderly that will be in the label around dosing. And those all have to play through, but if those get issued and actually into the label, that would move protection out even a couple of years beyond that.

So getting that method of treatment in IPF chronic cough was super important for us..

Thank you..

Yes. Thank you, Serge..

Our next question will come from Tom Smith with SVB Securities. You may now go ahead..

Hi. This is Matt Swanson [ph] for Tom Smith. Just one quick question from us.

So what are the gating factors to initiate a Phase 2 trial in RCC and the Phase 2b study in chronic cough in IPF? Curiously, like you mentioned packaging material shortage was like one of the factors, is like that issue being like solved?.

Yes. So just to be clear, the materials issue I mentioned is butorphanol only affects our human abuse potential study. So that does not affect our Phase 2b dose ranging or our refractory chronic cough. We have plenty of drug supply with our own products. So just to be clear, that's sort of its own distinct issue.

As far as the gating factors of where we are now, I gave you sort of a good rundown of what we've accomplished. It's really the regulatory getting signed off from the regulatory authorities. We are running these studies internationally. So we have to work through sort of the various regulators comments.

But we have final protocols that will be submitted for regulatory input, and that's really the swing factor we said initiating in the second half of this year. Assuming that we get through the regulatory process pretty smoothly, it will be sooner and if we get any comments back we'll have to adjust the protocol and go back to them.

So it could be a little later in the second half..

Got it. Thank you..

You are welcome..

Our next question will come from Mayank Mamtani with B. Riley Securities. You may now go ahead..

Hi. This is William [ph] on for Mayank. Congratulations on the very nice quarter and thank you for taking our question. So a couple from us.

Just at a regulatory level, I guess, could you remind us of the current IND status for Haduvio in chronic cough and how that's progressing?.

Thank you, William. Yes. So we were getting input with the FDA around the Phase 1b respiratory physiology study. That will be our IND opening study. So we’re preparing that now, and that should be submitted shortly with the agency. But fortunately, we’ve had a lot of good dialogue with them about the program.

So we should be able to move that through and hopefully get the IND open and get that study moving along..

Got you. Very helpful. And just thinking about RCC, in terms of the patient population that you’re planning to target, are you going completely broad sort of incorporating everybody or trying to do more to targeting specific subgroups that you think Haduvio may work best in and then maybe building out from there or some combination of that.

If you could us speak to that, please?.

Yes. No, it’s a good question. And this is where I mentioned in my comments. Look, we don’t need to sort of recreate the wheel here. There has been a lot of studies run in RCC. And it’s become pretty clear that an enrichment strategy there is quite effective.

So we’re working through those details, but we’ll probably do a 2:1 enrichment strategy of coughers is greater than 20 and then some portion of coughers that are in the 10 to 19 range. We want to be mindful, though, because BELLLUS is out running these two pivotal studies with this enrichment criteria of greater than 20.

If we don’t have that as a requirement in our studies, we’ll end up with all the mild coughers. So, we don’t want that to happen either. So we have put in some parameters around that to get a more enriched population, but we will also study some of the lower coughers, which they’re doing as well. They’re doing a 3:1 randomization..

Right, makes sense. And then one quick last one. I know you’ve mentioned that the open-label prism, you are analyzing it and then be meeting with the FDA.

Any indication or color on when and where we might see that? And then any potential interactions you’ve had for that, or with that program?.

Yes. So William, I’m actually waiting to see that data myself, our physician who is driving that along is sort of synthesizing that down, and we’ll share it with the team. Where that gets presented, I think the most obvious next big derm conference is EADV, which is in the fall in Europe.

But we probably will do something in one of our press releases with some of the top line that we saw because people – I know people are interested in that. As far as strategic conversations, we continue to be active there and move those along. But as we said, we as well want to have our end of Phase 2 meeting.

So we clarify exactly what’s left in this program. So we certainly have been in conversations. We know the short list of interest. I think it’s a matter of working our way through that FDA meeting and then reassessing at that point based on what we learn. ..

Got it. That’s all from us. Thank you for taking the questions again. And congratulations again on a good quarter. Thanks..

Thank you..

Our next question will come from Sean Kim with Jones Trading. You may now go ahead..

Yes, hi. Thank you for taking my questions. So, I guess one question on the nodularis program. So what kind of feedback would you be expecting from the end of Phase 2 meeting in order for you to kind of move forward with the program? And I guess my second question is on the RCC side of things.

So, now that BELLLUS Health is being acquired by the larger pharma GSK. Has that shifted your thinking in terms of potentially commercializing Haduvio that leading commercial efforts into U.S. or potentially partnering up canoe competing against the larger biopharmas? Thank you..

Yes. Thank you, Sean. On PN, as far as feedback, the key question that we want to confirm is that the Phase 2b/3 serves as one of our two pivotal studies the agency agrees that we only need one additional trial. We’re going to present the protocol for the next trial, which essentially looks just like the trial we just ran possibly a little bit longer.

So we just want to confirm that there’s one more study. Here’s what it looks like. There’s some little CMC questions to nail down, but nothing too major. So it’s really pretty [indiscernible] it’s all really around that, that we’re sort of there. As far as RCC, I don’t think it’s changed our thinking at all.

I think we’re continuing to sort of refine in our own minds to where we’re going to compete. And I think where the RCC market comes out for us is we’re looking at the severe difficult-to-treat patients.

P2X3s work in about half the population don’t work in about half the population, and we think that’s because they essentially work on that peripheral chain. We believe because of our central mechanism that we should be able to work in more patients and have a bigger effect.

So our lead indication will be IPF chronic cough, which we think will set us up for a nice premium pricing and also other interstitial lung diseases. We think that we may be able to hold that at a pretty strong level for picking up the failures in the chronic cough market, which is about half of that market. So it’s still a big opportunity.

So that’s how we think about it. As far as partnering that out, we say to partners all the time when they ask about that. I mean we’re a single asset company and cough is our lead focus. So, if people want the rights in the U.S. for that program, they’re going to have to buy Trevi.

We’ll look at sort of Japan or possibly Europe, but in the U.S., they’re just going to have to buy the company..

Okay, thanks. That’s helpful. Thank you very much..

Yes, thank you, Sean..

[Operator Instructions] Our next question will be a follow-up from Annabel Samimy with Stifel..

Sorry about that. Our question was previously answered. Thank you..

I’m showing no further questions. This concludes our question-and-answer session. I would like to turn the conference call back over to Jennifer Good for any closing remarks..

We would like to thank everybody for participating in today’s call. We have several upcoming conferences and medical meetings that we are participating in before summer gets fully underway. You can see them detailed in our earnings release issued today. I hope to see some of you at these meetings. Thank you..

The conference call has now concluded. Thank you attending today’s presentation, you may now disconnect..