Welcome to the conference call hosted by Daré Bioscience to review the Company's Financial Results for the Quarter Ended September 30, 2020, and to provide a general business update. This call is being recorded. My name is Chris, and I will be your operator today. With us today are Sabrina Martucci Johnson, Daré's President and Chief Executive Officer; John Fair, Daré's Chief Strategy Officer; and Lisa Walters-Hoffert, Daré's Chief Financial Officer. Miss. Johnson, please proceed.

Thank you, and welcome to our financial results and business update call for Daré Bioscience. We are looking forward to discussing our third quarter results, reflecting on some important achievements to date in 2020, highlighting anticipated developments and milestones for the remainder of 2020, and providing some perspective regarding our plans for 2021.

Thank you, Sabrina. Strategic partnerships are core to our model, particularly when it comes to how we plan to unlock value for shareholders and achieve commercialization objectives for our portfolio. The level of interest in our portfolio has been and continues to be strong, both from well-established large pharmaceutical companies, as well as mid-sized and emerging companies, both U.S. and global. We are actively advancing partnership discussions that we believe will allow us to maximize downstream commercial execution and provide access to the broadest patient population in the respective therapeutic categories. By being good stewards of these products and partnerships, we believe we can have a positive impact on the lives of women, while at the same time delivering shareholder value. For those of you familiar with the women's health category, you will appreciate that health care provider dynamics create commercial efficiencies and allow for a targeted call point across multiple indications. There are a number of established and emerging entities—commercial companies in the category—looking for opportunities to enhance their portfolios and amortize their field salesforce costs, which we expect will give us a lot of flexibility in terms of partnerships, partnership structures, timing of partnerships, and also finding the best fit opportunity to create value for our shareholders, particularly as we transition from a development portfolio to a commercial portfolio. As an example, we believe our agreement with Bayer for the investigational monthly hormone-free vaginal ring Ovaprene provides us with a robust commercial economic structure in the form of milestones and royalties, while at the same times giving Ovaprene the maximum commercial opportunity by putting the launch and commercialization in the hands of our partner, Bayer, as they look to expand their billion-dollar contraceptive franchise beyond Mirena and beyond the long-acting market segment. But we also have the flexibility to look for partnership opportunities for our other product candidates, which may include elements such as co-promotion, strategic cost sharing, risk sharing, and commercial structures where Daré takes more of an active role without bearing the burden of the commercialization infrastructure and associated expenses. Given our portfolio of potential first-in-line and first-in-category product candidates and the underlying commercial potential of these candidates, we have the flexibility to consider structures that range from directly managing commercial capability to partnering or co-promoting our products or fully licensing the commercial rights. This essentially means we can do what we believe is best for Daré and our shareholders in every case. We are fortunate to have such a unique and diversified portfolio because it allows us to be in a position to consider all of these structures, which we are currently doing with DARE-BV1. For DARE-BV1, we are specifically interested in opportunities that we believe will prioritize the product in a way that will allow us to unlock the most value for health care providers, for patients, and for payors as well as shareholders. So we look forward to providing you with additional insights on the DARE-BV1 partnership and commercialization strategy following the top-line data announcement later this year. And with that, I'm going to turn the call over to Lisa for a financial update.

Thank you, John. And thanks to all of you for joining us today. I would now like to summarize Daré's financial results for the quarter ended September 30, 2020. As you know, Daré business model is to assemble, advance, and monetize a portfolio of novel product candidates in women's health. As a result, our expenses consist of corporate overhead, portfolio acquisition and maintenance costs, and research and development activities to generate the clinical and other data necessary to advance our candidates through regulatory milestones, including approval. For the quarter just ended September 30, 2020, Daré's general and administrative expenses were approximately $1.4 million, license expenses were approximately $25,000, and research and development or R&D expenses were approximately $6.2 million. In addition to the personnel costs of our R&D team, this quarter's R&D expenses primarily reflect costs of the ongoing DARE-BV1 Phase 3 study activities related to Ovaprene and preclinical development activities for DARE-LARC1, with the DARE-LARC1 program supported by our grants from the Bill and Melinda Gates Foundation. Our comprehensive loss for the quarter was approximately $7.6 million. Net cash provided by financing activities for the nine months ended September 30, 2020, was approximately $16.7 million. Such proceeds were generated primarily from sales of stock under our ATM, or at-the-market facility and equity line, the exercise of warrants, and loan proceeds. We ended the quarter with approximately $5.4 million in cash and cash equivalents. Now there were several developments over the past few months worth highlighting given their current and anticipated impact on our cash burn and operating expenses. As Sabrina discussed earlier, in August, we announced the receipt of a notice of award of a $300,000 grant from the Eunice Kennedy Shriver National Institute of Child Health and Human Development in support of a Phase 1 clinical study of DARE-FRT1. She also noted Daré may be eligible to receive an additional $2 million award in further support of that Phase 1 study of DARE-FRT1 for a total of up to $2.3 million in funding based on the grant application submitted. In September, we announced the receipt of $900,000 of funding that remained under the pre-existing grants from the Bill and Melinda Gates Foundation to support DARE-LARC1 development activities, which brings total funding from the foundation for that program to approximately $20.5 million. Recall, the grant proceeds are recognized in our financial statements as a rejection or an offset to allowable costs associated with the DARE-LARC1 development program. Also in September, we announced an agreement with Avomeen, under which Avomeen will provide contract product development laboratory services with a specifically assembled team to support the advancement of a very innovative pipeline in a manner that is both time and cost-efficient. In July, we commenced our Phase 1 study of DARE-HRT1 in Australia, and we intend to apply for the maximum refundable cash credit then available under Australia's R&D tax incentive program. Currently, the program allows for eligible companies to receive up to 43.5% of their eligible R&D expenses in the form of a cash payment the following year. So in summary, based on these activities, we believe the Australian R&D tax incentive program, or NIH grant for DARE-FRT1, the Bill and Melinda Gates Foundation grant for DARE-LARC1, and our partnerships with Avomeen will collectively serve to reduce our cost of development in the months ahead and help us manage our resources efficiently. Now subsequent to the quarter's end, from October 1 through November 11, we took steps to further strengthen our cash position by raising approximately $4.5 million net of fees from sales of our common stock under our ATM and equity line. Following these activities, as of yesterday, November 11, shares of our common stock outstanding were approximately 38 million. We will continue to explore ways to access additional capital to advance our product candidates and satisfy our working capital needs. Since our inception, we have raised cash through the sale of our equity securities, M&A transactions, warrant and option exercises, non-dilutive grants, and license fees. We will endeavor to be creative and opportunistic in seeking the capital we need to not only maintain but to build value as we advance our candidates, and to be highly efficient in the use of such capital. In terms of COVID-19, and as Sabrina touched on, we are continuing to monitor the pandemic, its associated restrictions, and their potential impact on our business, financial condition, and results of operation, including their potential to adversely affect our ongoing implant clinical trials, and our ability to raise additional capital when needed. Due to the many uncertainties surrounding the pandemic, including governmental responses, we are unable to predict with any reasonable accuracy the full financial and business impact on our company at this time. We encourage investors to review the more detailed discussion of our financials and financial condition, liquidity and capital resources, and the risk factors in the 10-Q that we filed today. And to also review our audited financial statements and related notes and risk factors included in our 10-K that was filed on March 27, 2020. I would now like to turn the call over to Chris, our operator, for Q&A.

Thank you. And our first question comes from a line of Dora with Roth Capital Partners. Your line is now open.

Hi everyone. This is [name] from Roth. I have a couple of questions and thank you for the update. My first question is about something that I think everyone is focused on. The Daré for DARE-BV1 is expected to be announced before the end of the year. If that looks promising and supports a filing, I’d like to know your thoughts on partnerships and what you’re looking for. I believe John was going to provide some details on this. What qualities are you seeking in a partner? Is this something you could handle alone, or do you definitely intend to pursue a partnership?

Yes, and maybe I'll take this opportunity to—this is Sabrina speaking, of course—to reinforce some of the comments that John made to really point out how we're addressing that question for you. So one of the things about Daré in our portfolio, as we both touched on, is that it's a very diverse, diversified portfolio. We have a number of candidates in various stages and phases of development. And so that really does allow us to consider a number of different transaction structures. On the one hand, you have the type of transaction that we did with Daré for Ovaprene, which we felt was definitely the right transaction for that product with a partner like Daré that has demonstrated they can build over a billion-dollar contraceptive brand, and with that opportunity, that's the right thing for shareholders to take it. With other aspects of our portfolio and products like DARE-BV1, we have a lot of flexibility to consider a variety of structures for a few reasons. One, there are a variety of structures that can continue to be accretive for shareholders. There are a lot of ways you can take a product to commercialization, and they can include different structures that range from co-promotion to out-partnering to fully licensing to managing commercial infrastructures—there’s a variety of approaches that we can take. With a product like DARE-BV1 specifically, we can really actually contemplate all of those approaches. It is intended to be—and we think it has the potential to be—a first-line product, which is obviously a really great opportunity for anyone in the women's health category, whether they have a commercial infrastructure in the category in bacterial vaginosis or not. It’s a great addition to any women's health portfolio. However, unlike Ovaprene, we're not looking for someone who can actually build a brand new therapeutic category. Ovaprene is so unique that a partnership like Daré is so important to build that category. So hopefully, what you heard from John's comments, and I'm reinforcing, is that we are talking to a number of potential partners around BV1, and we are looking at a full range of structures and possibilities as it pertains to that. In the end, we are going to select the structure that we think best fits with Daré's strategic objectives and shareholder value. The beauty is that we have a lot of flexibility in what we select because of how we are structured today.

Yes, and I would just echo that. That's exactly what I wrote down actually when you asked the question. So it's really about maintaining our optionality, really creating value for shareholders and making sure we're maximizing the opportunity, and then really finding that best fit opportunity, that best fit partnership structure. So that's to be determined. Obviously, we never announce anything until we have something to announce, but know that we're working hard on the back end to make that happen.

Thank you. And then another thing, I was just wondering in terms of structuring the deal, is it possible that you could throw a denovo into that deal? Because that's progressing very well. I think there's some synergies there.

Yes. So thank you, first of all, for recognizing that we have a portfolio of products. And it does give me an opportunity to say, I mean, one of the beauties of having a portfolio—and I touched on this in my comments, and I want to take this opportunity to reinforce that fact—is that we have a variety of programs that are diversified across indications and development stages. Not only does it give us the opportunity, as I mentioned, to deploy our resources in very creative ways and deploy investment in creative ways, but it also creates opportunities to advance things simultaneously that have very different risk profiles and timeline profiles, even in a challenging environment. The other thing it allows us to do, frankly, is always be in front of all of the players in the women's health space and continue to look at a variety of creative structures that Daré is uniquely suited to do in the women's health category. To our knowledge, we're the only company that has a portfolio of this nature with these kinds of first-in-category opportunities across therapeutic indications. As you noted, that uniqueness of our portfolio can provide unique partnership opportunities. So we are always exploring what is going to make the most sense. As John noted, partnerships are about who's the other party, what structure makes sense, but sometimes it’s also about timing. So we’re weighing all of those variables as we look at it. For DARE-BV1, for instance, we specifically made a decision, as I mentioned up front, to partner after the Phase 3 top-line readout because that puts us in the strongest potential for that program. But as you noted, other programs provide different types of partnership opportunities, and we will explore those fully.

Thanks, guys looking forward to the data.

Yes, don’t worry.

Thank you. Our next question comes from a line of Jason Kolbert with Dawson James. Your line is now open.

Hi, guys, congratulations on a lot of fronts. Preservation of capital on the balance sheet, I see that as positive and keeping your options open when it comes to partnering. In terms of BV1, I think it would be helpful for me, and maybe for others, if you could just remind us of that trial powering and the therapy assumptions so that we can just re-familiarize ourselves with the probabilities of hitting the primary endpoint and what would be perceived as great data. Thanks.

Thank you for that question and that opportunity to highlight that. So let's start with the current standard of care today. The current standard of care has cure rates in the mid-30s to the mid-60s. This includes all your FDA-approved products for bacterial vaginosis, which include oral as well as vaginal options. The challenge with bacterial vaginosis treatments is that many of the treatments on the market require administration every several days, which is often challenging, both in terms of compliance and outcomes. However, they tend to rely upon two of the same antibiotics predominantly, metronidazole or clindamycin. In the case of BV1, we are using 2% clindamycin as a dosage form. It’s an antibiotic that has been previously studied in bacterial vaginosis, which has a cure rate in that range I talked about earlier. The challenge, as physicians and patients typically prefer a vaginal administration in this indication due to the types of symptoms women experience, is that the products must remain in the vaginal area to be effective. Administration of many vaginal products tends to leak out and negatively impacts the cure rates of antibiotics like clindamycin, which really need to be present to fight the infection. So the innovation in DARE-BV1 is that drug delivery platform. It’s a hydrogel thermosetting formulation that is quite viscous and bio-adhesive, and it becomes more so once heated to body temperature, with a one-and-done delivery. So she only has to use it once. In terms of aiming for a cure rate in the trial design, the nice aspect about bacterial vaginosis clinical studies is that products developed over time typically display similar clinical signs and symptoms that distinguish the condition and become part of the cure calculation. In recent years, the FDA finalized their guidance in 2019. Typically, the focus is on determining whether there's resolution of a distinctive vaginal odor and vaginal discharge associated with bacterial vaginosis, while also seeking a specific percent reduction down to below 20% of certain inflammatory response cells. That is how you determine cure. Most of the approved treatments range from mid-30s to mid-60s, with a majority requiring multiple doses, except for a few treatments. Frankly, a cure rate in the upper end of that range is excellent, especially since this is a one-time administration. It's a clean formulation and is appealing due to its bio-adhesive nature. This data will be captured in the Phase 3 study, including acceptability and user perception. The investigator-initiated pilot study revealed an 86% cure rate, which maintained in that high range even at 21 to 30 days after administration. We would love to see cures in that range, although we don't need that; anything that shows improvement over today's standards is favorable. Regarding the trial design, we reported that a total of just over 300 patients were enrolled, exceeding our expectations due to robust enrollment; we surpassed our target number. This study did not suffer from COVID-related impacts and exceeded enrollment goals. The structure is two-to-one active to placebo. The primary endpoint is a test of cure assessment that measures vaginal odor, discharge symptoms, and cellular responses returning to a non-BV state at day 21 to 30. This was an ideal choice for us to run during COVID, as it's a 30-day study, allowing for quick patient commitment, while also providing valuable information useful for future studies with Sildenafil Cream and Ovaprene, which require longer durations. Therefore, when we announce top-line data, pay attention to the primary endpoint: the test of cure in the active arm versus placebo, and we look for statistical separation between the two.

Of course, thank you. That was really, really helpful, and that was a great reminder for me. Good luck. Thanks.

Thank you so much. Yes, we are obviously really excited about it. As always, the first Phase 3 is super exciting when you have a company.

And this concludes today's question-and-answer session. I will now turn the call back to Sabrina Martucci Johnson for any closing remarks.

Yes, thank you. We went a little longer than anticipated. So thank you for your patience, and sorry to have to start the Q&A a little earlier than we hoped. But thank you all for attending the conference call. We really appreciate you taking the time this afternoon. I do want to take a couple of minutes—sorry—just to summarize what we talked about. As I mentioned, we're really looking forward to wrapping up 2020 with that Phase 3 top-line data readout for DARE-BV1, and we're looking forward to the milestone events that we planned in 2021 to move forward on those. Specifically, I want to close the call with a reminder of what we're expecting in terms of those key milestones for our mid and late-stage programs for the remainder of this year, and then going into 2021. As we've been discussing, for DARE-BV1, we anticipate that the Phase 3 top-line data readout will occur before the end of this year. Assuming a positive outcome, the data from this study would lead to a series of regulatory activities to support that NDA submission in the first half of 2021, which is our target. We are also talking about that strategic partnership to support commercialization in the United States. For our arousal disorder program, as I mentioned, we plan to start that Phase 2b study in the first quarter of 2021, and we expect that should support a top-line data readout by the end of 2021 for that Phase 2b. Additionally, as I mentioned, we also have Ovaprene activities to support the pivotal study start by year-end 2021, allowing for a top-line data readout by the end of 2022. As I touched on briefly, please be on the lookout for the DARE-HRT1 Phase 1 top-line data readout in the first half of 2021. We also expect to announce Phase 1 activities for both the DARE-FRT1 program under the NIH grant, as well as DARE-VBA1 in that breast cancer population in 2021. Lastly, as John noted earlier, in addition to the clinical and regulatory milestones, we will continue to focus on our ongoing partnering activities and opportunities to monetize our pipeline of potential first-in-category women's health products across our entire portfolio as we've been discussing, and across geographies, as John mentioned. We look forward to keeping you updated on our progress, and we're grateful, certainly, to our team, but importantly to our shareholders for their commitment and dedication to our mission. So thank you for taking the time today.

Thank you. Well, ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.