Richard Chin - CEO & President Denise Bevers - COO Wendy Wee - VP, Finance.

Analysts:.

Welcome to the First Quarter Financial Results Conference Call and Webcast for Kindred Biosciences. [Operator Instructions]. It is now my pleasure to turn the call over to KindredBio's CEO and President, Richard Chin. Dr. Chin, please proceed..

Thank you, operator. Good afternoon and welcome to our first quarter 2016 financial results call. Joining me today from Kindred Bio management are Denise Bevers, our Chief Operating Officer and Wendy Wee, our VP of Finance.

Before I begin, I should note that our remarks today will include forward-looking statements and that the actual results could differ materially from those projected or implied in our forward-looking statements. For a description of important factors that could cause actual results to differ.

I refer you to the forward-looking statements in today's press release and a note on forward-looking statements in our SEC filings. I will begin the call with a general corporate update. Denise will follow with an update on our lead programs. And Wendy will conclude with first quarter financial highlights.

We had a fantastic first quarter and we are poised to have a very successful year. We achieved multiple goals critical to the advancement of our lead product candidates in the first quarter bringing us closer to our first product launch and revenue generation.

The entire Kindred Bio team have been working extremely hard and I'm pleased to report that we are on track or ahead of schedule with our key milestones for the year. Let me start with an update on the Zimeta, our lead equine drug for fever in horses. We are preparing for approval and launch by end of this year or early next year.

All major sections of the new animal drug applications have been submitted as planned and we're laying the groundwork for a successful launch including commercial manufacturing, distribution channels, sales and marketing infrastructure among other tasks. With a strong team of people who have extensive experience launching drugs we’re well positioned.

Let me remind you why the equine market including Zimeta represents a compelling opportunity. The equine space is a largely untapped market with many significant unmet medical needs including fever. In addition the cost of commercializing into the equine space is low since it is a highly concentrated market.

Furthermore, the willingness to pay is much higher than in the rest of the companion animals space. As part of the launch preparation we're pleased to announce the formation of Kindred Bio Equine which is a subsidiary for the equine business.

This branded specialty pharmaceutical company will be one of those very few devoted exclusively to equine health and underscores our commitment to becoming a leader in the field. In addition this allows us in the future to spin out our split out the equine business if that makes sense and unlock shareholder value.

I want to note that our expect transition to a revenue producing company less than four years after founding is a major accomplishment. This demonstrates not only our drug development capabilities but also the advantages of our animal health focus as we are able to quickly and efficiently develop therapeutics.

Let me turn next to the lead product candid in our feline portfolio KIND-010. We’re also pleased to announce completion of enrollment in the pivotal study for KIND-010 which is a transdermal gel for the management of weight loss in cats. This with ahead of schedule and we’re eagerly awaiting the unblinding.

This product addresses a very significant unmet medical need and we look forward to bringing this to our feline patients. Denise will go into more detail on the progress of our pipeline but I want to touch on a new scaffold technology KIND bodies.

I'm happy to report that we continue to make excellent progress in the platform and we have validated the key characteristics of the technology, we’re more confident than ever in the promise of KIND bodies. The scaffold we believe puts us way ahead of most of our competitors in platform technology.

In addition, I'm pleased that the process of commissioning our biologics manufacturing plant is progressing rapidly, as I’ve mentioned in past the plants is one of the most advanced cutting edge plants in the world and we've built it in record time and at a very attractive cost. It will become a cornerstone for our successful biologic strategy.

If we take a step back it is clear that Kindred Bio is in an excellent position. We have a deep pipeline that is well funded and backed by a top notch team. We are already leaders in the biologic space and plan to soon become the leader in the equine space.

We are a pioneer in a burgeoning new field, one positive pivotal study has already been completed and we will potentially soon have another one. We have the pole position in the companion animal space and when we plan not to give away the lead. There is a bright future ahead of us and it's coming closer every day. Thank you for your continued support.

I will now turn it over to Denise..

Thank you, Richard. This has been quite a productive first quarter for Kindred Bio. As Richard, we’re pleased that all of the major technical sections of the new animal drug application or NADA have been submitted for Zimeta.

We are working feverishly pun absolutely intended on our commercial planning and preparation in anticipation of the approval of Zimeta for launch in late 2016 or early 2017. For KIND-0101 our lead feline product for the management of weight loss in cats we are preparing for a database lock and reporting of top line results as I speak.

The target animal safety study has also been completed successfully for KIND-0101 and we have submitted the chemical manufacturing and controlled technical section of the any NADA. Once again this demonstrates our ability to hit our aggressive timelines and budget milestones for a given program.

We continue to make significant progress with EPO cats, our feline erythropoietin program for the control of non-regenerative anemia in cats. We saw an effectiveness signal in our initial laboratory studies as evidenced by [indiscernible] and as a result initiated a pilot field efficacy study which is underway.

As Richard mentioned, we are finalizing our GMP manufacturing activities and anticipate proceeding to GMP manufacturing for this product in 2016. I'm excited to give you an update on two of our other equine product candidates that are in development.

We have completed a pilot laboratory study for KIND-014 which is for the treatment of gastric ulcers in horses. This study was conducted to demonstrate the effectiveness and safety of two formulations and the results were positive, both formulation showed efficacy as measured by gastric ph and were well tolerated.

A pilot field study had been initiated for KIND-014. Additionally we're optimizing our formulation of KIND-015 a development candidate for metabolic syndrome in horses which is a disease similar to type 2 diet in humans. We plan to initiate pilot field, efficacy studies in the second half of 2016.

We're making great progress in our development of biologics, our antibodies against cytokines and checkpoint inhibitors are progressing on track and initial pilot studies for some of the antibodies are anticipating in 2016. With that I will now turn the call over to Wendy to update you on our first quarter 2016 financials..

Thank you, Denise. For the quarter ended March 31, 2016 Kindred Bio reported a net loss of 6.1 million or $0.31 per share as compared to a net loss of 6.7 million or $0.34 per share for the same period in 2015.

Total research and development expenses for the quarter ended March 31, 2016 were 3.4 million compared to 4.8 million for the same period in 2015. The 1.4 million year-over-year decrease in research and development expenses reflects several factors. Payroll and related expenses decrease as a result of our corporate restructuring in January.

Clinical trial expenses declined due to the earlier than expected completion of the pivotal study for KIND-010 and we recorded lower stock based compensation expense and consulting cost. The prior year's expenses also included field trial cost for programs that have been completed or discontinued.

Total general and administrative expenses for the 2016 and 2015 first quarters were stable at 2 million expenditures in the first quarter of 2016 included a mix of higher payroll and related expenses due to increased headcount, higher facility and marketing expenses offset by lower consulting professional services and stock based compensation expenses.

We recorded a restructuring charge of 655,000 in the first quarter of 2016 in order to streamline our development programs and extend our cash runway. The total number of employees impacted by the restructuring was 18. As of March 31, 2016 we had 70.5 million in cash, cash equivalents and investments compared with 77.6 million as of December 31, 2015.

The decrease was primarily due to cash used in operating activities of approximately 6.5 million.

For the 2016 calendar year we reiterate our previous guidance for operating expenses to be in the range of 24 million to 26 million excluding the impact of stock based compensation expense and the impact of acquisitions if any, our anticipated expenditures for the remainder of the year include regulatory costs associated with the filing of registration of KIND-010, preparing for the commercial launch Zimeta as well as the continued development of our pipeline candidates.

With that. I will turn the call back over to Richard..

Thank you, Wendy. Operator we're now ready for Q&A..

Operator:.

Thank you, Operator. I would like to take a moment to thank all the Kindred Bio team members and our investigators for all the hard work and dedication and importantly to thank all of you who called in today for your support and interest in Kindred Bio. We are making rapid progress in our mission.

We will soon be a revenue producing company with a deep pipeline and a leading position in the equine and biologic space. We’re well-funded, we have top people, cutting edge technology and great momentum. We look forward to the successes to come. Thank you..

Ladies and gentlemen thank you for participating in today's conference. This concludes today's program. You may all disconnect. Everyone have a great day..