Jaguar Health, Inc. Q4 FY2022 Earnings Call

Good morning. Before I hand the call over to management, I want to remind everyone that management may share forward-looking statements regarding aspects such as the company's growth prospects, uncertainties related to market acceptance of products, the effects of competition and pricing, as well as industry trends and product initiatives, including development stage projects that may not meet scientific objectives or comply with regulatory requirements. These forward-looking statements involve risks and uncertainties that could lead to actual results differing significantly from those anticipated. The statements are based on the information currently available and management's present assumptions, expectations, and forecasts about future events. While management believes that these assumptions, expectations, and forecasts are reasonable given the current information, we advise against placing excessive reliance on them. The actual results may vary widely from what is discussed today for numerous reasons, including those outlined in the forward-looking statements and risk factors in the company’s Form 10-K for the year 2022, which was filed on March 24, 2023, alongside other SEC filings available on the Investor Relations section of Jaguar's website. Unless required by law, Jaguar is not obligated to update or alter any forward-looking statements made in this presentation to account for new information and future events. Furthermore, please note that the company supplements its condensed consolidated financial statements, which are prepared on a GAAP basis, by providing non-GAAP EBITDA and non-GAAP recurring EBITDA. Jaguar believes that these non-GAAP measures give investors additional insights into how management assesses and operates the business. These financial measures should not be viewed independently or as replacements for GAAP net sales and GAAP net loss, and do not replace or surpass GAAP measures of financial performance. Today's conference is being recorded. Now, it is my pleasure to turn the conference over to Lisa Conte, Jaguar Health's Founder, President, and Chief Executive Officer. Lisa, the floor is yours.

Thank you very much and welcome to all. As you just heard, my name is Lisa Conte and I'm the Founder, President and CEO of Jaguar Health and our wholly owned subsidiary in the United States, Napo Pharmaceuticals. Sometimes we use Napo and Jaguar names interchangeably. I'm also a member of the Board of Napo Therapeutics, the corporation we established in 2021 in Milan, Italy, which is focused on expanding access to Crofelemer in Europe, in particular for rare disorders. I'm going to begin today by letting you know we will highlight shortly the key events that we expect in 2023 will be transformative in terms of value generation for all our stakeholders including patients and shareholders. Moving late-stage pipeline opportunities towards revenue-generating reality, this is an important theme that you will hear infused throughout today's call. Right now, I will review the key top line results for the fourth quarter of 2022. Prescription product net revenue was approximately $11.9 million for the year ended December 31, 2022, versus approximately $4.3 million for the previous year ended December 31, 2021, an increase of 178.7%. We are quite pleased with the growth trajectory of our current prescription drug business which from Mytesi is currently limited to the approved specialty market indication of HIV-related diarrhea and, as I often say, specialty often typically means a relatively small market opportunity. Regarding the company's cash position, the company had cash of approximately $15.3 million as of March 24, 2023, just a couple of days ago, the filing date of Jaguar's annual report on Form 10-K for the year 2022. I'm going to repeat that. Cash of approximately $15.3 million, as I speak this morning, an important and meaningful subsequent event in our 10-K filing that I'm often asked about. Following my update, Carol Lizak, Jaguar's Chief Financial Officer, will provide a recap of the key financial results for 2022. And then we'll hear from Ian Wendt, Jaguar's Chief Commercial Officer. Ian will speak to updates on Mytesi-related commercial initiatives to continue to educate and serve the HIV community and about ongoing commercial efforts underway for Canalevia-CA1, our prescription drug for the treatment of chemotherapy-induced diarrhea in dogs. As a reminder, our commercialized human drug product is named Mytesi. The generic name is Crofelemer. It's a first-in-class antisecretory agent approved initially in the United States for the specialty indication of HIV-related diarrhea, very specifically the symptomatic relief of noninfectious diarrhea in adult patients with HIV AIDS on anti-retroviral therapy. As I mentioned, it's a relatively small market. This indication was fast-tracked by the FDA. And that's why HIV diarrhea is the first approved indication for Crofelemer. As I frequently state, what is really powerful about Crofelemer is that it is a pipeline within a product. And what I'm going to focus on today are our key clinical milestones. Again, what we believe are potentially transformative events in 2023 in support of the company Crofelemer from pipeline opportunities; two, with the potential of important and significant clinical trial results this year, tangible revenue-generating patient-benefiting, shareholder, stakeholder benefiting product indications our ongoing pivotal Phase III trial, OnTarget trial, called the OnTarget trial of Crofelemer for cancer therapy-related diarrhea and I may refer to that as CTD is our flagship development program. This trial is being conducted with the same dose and formulation of our Mytesi product, of course, already commercialized in the United States for HIV-related diarrhea, the same product, same dose, same formulation. The OnTarget trial is evaluating the effectiveness of Crofelemer's novel mechanism of action, the modulation of two chloride ion channels in the gastrointestinal tract to mitigate or substantially reduce CTD in a prophylactic setting. It is a study that aims to expand the approved indication of Mytesi from the current limited HIV-related diarrhea to the potential blockbuster needs of prophylaxis in patients with cancer therapy-related diarrhea. Our efforts over the past year to expand the OnTarget trial to new U.S. and international sites with trial sites now active in Eastern Europe in both Georgia and the Republic of Serbia as well as in Argentina and Taiwan have significantly accelerated patient enrollment. Enrollment is now at approximately essentially at over 80%. OnTarget trial enrollment of 256 patients is expected to complete early in the second quarter of 2023 which is literally just around the quarter. We do feel that the OnTarget trial will be transformative for value and value recognition at Jaguar. Diarrhea is the most common side effect associated with cancer therapy; as many as 52 to 100% of patients experience diarrhea. In addition to addressing patient comfort and dignity which is so important, with approximately 40% of patients changing or stopping their life-saving cancer therapy due to diarrhea, there is a clear unmet medical need for a focused paradigm-shifting biological approach. Our expectation is that the placebo-controlled OnTarget trial will provide evidence that diarrhea associated with targeted cancer therapies is chronic, impacts the patient's ability to remain on their targeted cancer therapy regimens, at proven doses for better outcomes in their cancer treatment. And that addressing CTD reduces overall health care costs, such as required hospitalization and rehydration from implications of chronic and/or severe diarrhea. Remember, Crofelemer has providing a potential opportunity for a paradigm shift for both prophylaxis and management of CTD. For which there are no current approved or tested antidiarrheal agents for which antimotility drugs such as Imodium and loperamide which are primarily opioids have constipating risks which is totally inappropriate and, again, untested and unapproved for chronic administration. Crofelemer is not an opioid and does not have that constipating risk associated with opioids. Each year, according to the CDC, more than 1 million cancer patients received chemotherapy or radiation in an outpatient oncology clinic in the United States. Treatment can last for months to years in both the curative and metastatic situations. These targeted therapies, of which there are about 70 now used on a chronic basis, often for the rest of the patient's life, work for the most part by mechanisms that induce the type of secretory diarrhea that Crofelemer normalizes. Again, OnTarget is a prophylactic study which tells you a lot about how important it is to prevent the onset and the impact of diarrhea during cancer treatment with targeted therapy drugs. CTD is not the mild loss of bowel control that we've all invariably experienced with perhaps a mild flu or a bad meal. This is diarrhea that can put patients in the hospital, cause organ shutdown, and has even contributed to death in some patients who have been studied in targeted cancer agent manufacturers clinical trials. To project the potential global market opportunity for CTD, since Crofelemer would be the first drug to be approved for this indication, we're looking at an analogous market. While we don't provide specific financial guidance and forecasts, the value of the global chemotherapy-induced nausea and vomiting market, CINV, is projected to reach $3.9 billion by 2029, according to a report published by a market research firm. CINV agents are typically only used for about the first 3 to 5 days in traditional cytotoxic chemotherapy and many of these agents are generic which somewhat lowers what the projections for proprietary drugs can look like. With CTD, we are talking about diarrhea that can persist on a chronic basis for months or years. That's the paradigm shift. We are very excited about our CTD program, the successful completion of patient enrollment in the OnTarget pivotal trial which, as I mentioned, is targeted for early in the second quarter of 2023. We expect to lead to a primary endpoint readout in Q3 of this year and then to a supplemental new drug application filing for the same formulation of Crofelemer as the currently commercialized drug Mytesi. Mytesi is already approved for chronic use in people living with HIV AIDS, and it has a full FDA compliant supply chain in place from the rainforest to our distribution network with specialty pharmacies across the United States. And as a reminder, safety and manufacturing are the 2 most common reasons that new drug applications fail and these activities are completed for Mytesi from a regulatory perspective. Hence, we spent much care and engage in extensive communication with the FDA in the business line and execution of the final clinical and regulatory steps to support bringing Crofelemer to cancer patients suffering from diarrhea and/or the risk of on a prophylaxis basis from their prescribed therapy. In preparation for the expected commercial launch of Crofelemer for CTD, we're increasing our focus on patient advocacy initiatives in the United States. In support of this goal, we're very pleased by Dr. Kelly Shanahan, a former clinician herself and a metastatic breast cancer patient who is now a full-time independent patient advocate, has joined the Jaguar Scientific Advisory Board as both a healthcare provider in cancer patients. She shares our deep commitment to patient comfort and dignity, especially the importance of preventing and ameliorating CTD on a chronic basis and in both curative and metastatic settings. And to supportive care in cancer patients in general. We are so pleased to hear Dr. Shanahan's voice and perspective on how successful supportive care management is a key component to successful cancer treatment outcomes. She brings a unique and welcome perspective to the community, including industry that will augment our efforts to bring about a paradigm shift to address the very high unmet and neglected comorbidity of CTD as novel targeted agents and approaches are addressing long-term management and potential cures for cancer. We support a full community approach to holistic patient care and comfort to support life and support quality of life. I'll now discuss our 2 prioritized rare disease target indications for Crofelemer. Short bowel syndrome which I refer to as SBS with intestinal failure in adults and microvillous inclusion disease, MVID, an ultra-rare pediatric congenital diarrheal disorder. This year, Jaguar and the company we established in Europe, Napo Therapeutics, are planning to support third-party investigator-initiated proof-of-concept studies of Crofelemer in patients with SBS with intestinal failure or pediatric patients with MVID focused on obtaining proof-of-concept data showing reduction of requirements of parenteral support, including parenteral nutrition and/or IV fluids. In accordance with the guidelines of specific European Union countries, publications of data from proof-of-concept trials could support early patient access programs to Crofelemer for SBS with intestinal failure or MVID potentially in 2024 through programs in these certain European countries, Italy, France, U.K., perhaps Spain as well. Early access programs do not exist in the United States, are revenue-generating and reimbursable for participating patients while the indicated product is continuing through clinical development for full approval in the EU. Let me describe for a moment the catastrophic medical situation for people with short bowel syndrome. Normal small intestine is 20 to 25 feet in length. In short bowel syndrome, the patient's small bowel could be less than 5 feet for congenital reasons or as a result of surgery due to cancer inflammation or an accident. As you can imagine, with a very short gut, it's like SIV. What goes in comes right out; the bottom line is, there's not enough intestinal real estate, enough surface area for the SBS patient to absorb the nutrients of life, carbohydrates, protein, fats, vitamins, and minerals. So what happens is that such SBS patients that have intestinal failure often end up on parenteral nutrition, the intravenous feeding of liquid nutrients for up to 20 hours a day, 7 days a week. Obviously, this has a significant negative impact on patients' quality of life and there are multiple adverse events, infections, and other complications associated with parenteral nutrition quite common. And parenteral nutrition is expensive, costing hundreds of thousands to $1 million a year to manage an individual patient including the myriad of associated complications with high morbidity, high mortality. The global SBS market is projected to reach $5 billion by 2027, according to reports from Vision Research reports. And this, again, we're an orphan indication of about 40,000 patients around the world but a classic orphan rare disease business model. Although parental nutrition is considered the standard of care, there is a drug product approved for SBS called Teduglutide and its GLP-2 analog. It's essentially a growth hormone, intended to grow the real estate of the gut slightly, so there's a little bit more time for absorption of the nutrients of life. It's administered as an injection and is estimated to be utilized in less than 10% of the SBS population. Again, it is not standard care. Teduglutide which is hard to pronounce, has a range of side effects, including liver disorders and is not tolerated by many patients on a chronic situation. The primary endpoint in the trial for the approval of Teduglutide was the reduction in the time required to be on parenteral nutrition by about 20%. What we're looking to do with Crofelemer is to reduce the time on parenteral nutrition as the primary endpoint as well that pathway has already been utilized and provide better stool consistency and quality of life measurement. We are working to design a global Phase II short bowel syndrome study of Crofelemer that harmonizes with the requirements of both the FDA and the European Medicines Agency, EMA, which is the regulatory agency of the EU. Jaguar is also planning to submit an investigation of new drug application and IND to the FDA for MVID in the second quarter of 2023. Again, another milestone just around the corner. So to recap, early in Q2 2023, literally, just a couple of days away, we expect to have completion of enrollment in our Phase III trial of prophylaxis of cancer therapy-related diarrhea. That's the OnTarget trial with a primary endpoint readout expected in Q3 of this year and within the same timeframe, we're targeting our first proof-of-concept evidence for patients with either SBS with intestinal failure and/or for MVID in support of potential early access program participation, revenue-generating participation in certain European countries. This pathway could bring in meaningful revenues while Crofelemer continues to go through the process for full approval, not only in the EU on a global basis for these 2 rare disease indications. I'm now going to discuss our other development stage programs at this time. We are prioritizing for 2023, these 2 late-stage clinical development programs with key near-term milestones with the potential to be transformative in value recognition for Jaguar, particularly with the current financial market conditions for emerging biotech companies which has not spared Jaguar either. And a new one to recap, our current cash solution. $15.3 million, relevant to achieving these important clinical milestones. Before I hand the discussion over to our CFO, Carol Lizak. I want to let you know that anybody participating today that we will have a brief Q&A segment at the end of the webcast to address questions if there are any submitted in writing and that we have time for. Questions can be submitted via the webcast link for today's event that appears on the Events and Presentations page of the Investor Relations section of Jaguar's website. The URL for Jaguar's website is jaguar.health. We will now move along to key financial results for the fourth quarter of 2022. And Carol Lizak, let me hand it over to you.

Well, thank you, Lisa and thank you all for joining our webcast today. I'll begin our review of our 2022 financials. Prescription product net revenue was approximately $11.9 million for the year ended December 31, 2022, versus approximately $4.3 million for the year ended December 31, 2021, an increase of 178.7%. Prescription product net revenue of approximately $3.3 million in Q4 2022 increased 3.4% over the third quarter in 2022 and increased approximately 57% over Prescription product net revenue in the fourth quarter of 2021. Mytesi total prescription volume was approximately 5,947 in the year 2022. Due to the transition to a limited distribution specialty pharmacy model in 2022, the company cannot accurately compare prescription volume from 2021 to 2022, as there are significant differences in reporting methodology from these distribution models. In the future, the company will be able to accurately reflect growth in prescription volume using 2022 as the new baseline. Mytesi total prescription volume decreased slightly by approximately 2% in the fourth quarter of 2022 over the third quarter of 2022. Prescription volume differs from invoiced sales volume which reflects, among other factors, varying buying patterns among specialty pharmacies in the closed network as they manage their inventory levels. The loss from operations decreased by $6.3 million from $40.7 million in the year 2021 to $34.4 million in 2022, largely due to the aggregate improvement in net revenue of $7.6 million, decreased cost of sales and marketing expenses of $400,000 and warrant inducement expenses of $1.6 million in 2021 and none recorded in 2022. These were offset by the aggregate increase in R&D and G&A expenses of $3.3 million. Non-GAAP EBITDA for the year 2022 and the year 2021 were a net loss of $28.1 million and net loss of $37.5 million, respectively. Net loss attributable to common shareholders decreased by approximately $5.1 million from $52.6 million in the year 2021 to $47.5 million in 2022. In addition to the loss from operations, interest expense increased by $4.3 million from $8.4 million in the year 2021 to $12.7 million in 2022, primarily due to the additional interest expense incurred on royalty interest agreements as a result of the change in the timing of payments due to exchanges in the new royalty interest purchase agreement. The loss on the extinguishment of debt increased by $1.4 million from $800,000 for the year 2021 to $2.2 million in 2022 due to the extinguishment loss from the exchange of the outstanding balance of a royalty agreement for shares of the company's common stock. Change in fair value of financial instruments and hybrid instruments designated at fair value option or FVO decreased by $1.9 million from a loss of approximately $2 million in the year 2021 to a loss of about $21,000 for the year 2022 primarily due to fair value adjustments in liability classified warrants and notes payable designated as FVO. Other income or expenses increased $1.7 million from approximately $800,000 other expenses for the year 2021 to approximately $1 million other income in 2022 due to write-off of extinguished liabilities as a result of legal release and reversal of long outstanding accruals with reasonable uncertainty not to be incurred. Well, that concludes my recap of high-level financials for the fourth quarter and the full year of 2022. I will now hand the discussion over to Ian Wendt, Jaguar's Chief Commercial Officer.

Thank you, Carol and good morning to all. Q4 2022 is the sixth consecutive quarter of growth in Mytesi net revenue which we're quite pleased about. As previously announced, the transition we completed in January 2022 to a limited distribution network of specialty pharmacies resulted in a meaningful reduction in Mytesi distribution costs as well as a higher average net price. I'm very pleased to report that we significantly outperformed the industry gross to net average in the fourth quarter of 2022 as we did in the 4 previous quarters for sales of our human prescription product. For comparison, according to prescription drug data and analytics firm, the rolling 4-quarter average gross to net discount rate in Q3 2022 was 48.9% for all U.S. prescription branded products. In 2022, the total gross to net discount for Mytesi was approximately 20%. The transition to specialty pharmacy distribution also assists in the preparation of the company's U.S. commercial distribution network for a potential future indication expansion of Crofelemer to other populations of patients with complex medical needs, such as CTD, inflammatory bowel disease, and SBS. I'm also pleased to report that our innovative recently launched programs that further support patients' connection to care and medication and access services are continuing as planned. Our telehealth initiative, which went live in May 2022, enables patients seeking help with their HIV-related diarrhea to be linked immediately to a provider for assistance with their medical needs. This capability prevents patients from having to wait until their next scheduled doctor visit to get help with what is an urgent problem. Additionally, as announced on March 13, we are excited to be developing an artificial intelligence-powered web portal for U.S. health care professionals to support patient access to Mytesi. We remain committed to reducing access and reimbursement barriers for Mytesi patients and one key challenge we often hear from patients and their health care providers is that payers and insurance companies frequently require prior authorization to approve medication reimbursement. Artificial intelligence, AI, technology, like OpenAI's generative AI platform model ChatGPT, is an innovative and powerful tool that allows providers to expeditiously communicate professional judgment by significantly reducing the time and complexity of drafting letters of medical necessity. We are working to create a user-friendly ChatGPT-enabled interface to help make this otherwise burdensome process easier and faster for health care providers to navigate in a compliant way. Leveraging AI technology in support of the prior authorization process is expected to help a significant number of Mytesi patients start on their medically appropriate and necessary medication quicker and be able to stay on their prescribed regimen helping ensure they spend fewer days suffering needlessly from HIV-related diarrhea. Turning to the Animal Health side of our business, Canalevia-CA1, our FDA initially approved drug for the treatment of chemotherapy-induced diarrhea or CID in dogs became commercially available to veterinarians across the United States at the end of April 2022. Since that time, we have succeeded in pushing Canalevia-CA1 into broad distribution with the leading veterinary distribution centers. Canalevia-CA1 net revenue was approximately $24,000 in the fourth quarter of 2022 representing an increase of 100% over Canalevia-CA1 net revenue in the third quarter of 2022 which totaled approximately $12,000. Commercial activities for the drug remain underway and reception of Canalevia-CA1 among general practice vets and veterinary oncologists continues to be extremely positive. That concludes my comments. Thank you all for your time today. I'll pass the conversation back to Lisa.

Thank you, Ian. I'm grateful to both Ian and Carol. At Jaguar, Napo, and Napo Therapeutics, we are excited about the significant initiatives we have planned for 2023 and beyond, with a strong strategic focus on key clinical milestones this year. These milestones are essential for enhancing the recognition of value for a company and an industry that have faced challenges in recent months and over the past year. I would like to highlight that this past Tuesday was International Day of Ours, and I want to express our pride in collaborating with the people and ecosystems of the tropical forests in Peru, from which we sustainably source the Latex and Dragon's Blood Tree, known scientifically as Croton lechleri, the plant that yields Crofelemer. The health of the people and the forests is deeply interconnected, and we are grateful to our partners and the rainforest communities who have educated us for decades on how to sustainably manage this valuable medicinal plant in support of our mission to increase access to Crofelemer for all patients in need worldwide. Additionally, I'd like to remind everyone that Crofelemer, Mytesi, is a natural product: it is organic, sustainably harvested, fair trade, and it is the only oral drug approved by the FDA under botanical guidance. Importantly, there is no practical pathway for bringing a generic to market under this guidance. We hold over 100 issued patents, with many more being filed regularly as is common in the pharmaceutical industry, providing us exclusivity indefinitely, which is a significant asset as we engage in business development discussions. This concludes our formal webcast for today, and I will now take a moment to look at some questions for our Q&A session as we have a little time left. It seems like there are several questions here. Is the primary completion date for chemotherapy-induced diarrhea still set for this month, March 2023? To recap the timing, we anticipate completing enrollment early in the second quarter, which means between April and the beginning of May. We are committed to that timeline. After we complete enrollment, the primary endpoint will be evaluated after three months of treatment. So, counting forward from April, you would look at the end of July to early August. Typically, in the industry, it takes about eight weeks to finalize the database needed to release the primary endpoint, plus or minus a little. Therefore, we expect to target the primary endpoint in the third quarter of this year following this sequence of events. We are aiming for statistical significance as discussed with the FDA, and there have been substantial positive discussions surrounding this trial. As for the primary endpoint, I've addressed that as well. Regarding any plans for raising cash to support your trials this year, I can share that we currently have $15.3 million in the bank, which we believe will help drive key clinical activities that could be transformative in value, targeted for the third quarter of this year. This should clarify the sentiment behind that question. Now, with Phase III enrollment largely complete in the second quarter and the transition to specialty pharmacy for Mytesi finalized, should investors expect significant decreases in expenses moving forward? The major expenses at the moment are tied to clinical work aimed at expanding indications and reaching new populations for Crofelemer. These clinical trials are still active. As we approach the conclusion of the trials, additional tasks will arise for statisticians and quality operations to ensure accurate database management. Would you like to add any comments, Carol?

Sure. We did save around the distribution costs compared to 2021 and 2022. So those were the big cost savings right there. And of course, the net revenue significantly increased. For R&D, yes, there will be some increases there because of the clinical trials surrounding our main indications focus which is CTD and the SBS group. So I think those are the key savings that we had for 2022 and 2021.

Thanks, Carol. I appreciate the opportunity to address this topic. Someone asked about our future plans to obtain a fast-track voucher for Cholera. The Cholera program is crucial and exciting, as Cholera-related diarrhea exemplifies how Crofelemer functions, along with our second antisecretory agent, NP-300. We do have an approved IND for NP-300. This product is being developed with the aim of securing a tropical disease priority review voucher from the FDA, an incentive for developing treatments for certain tropical and rare diseases, which includes Cholera. You receive this voucher after a successful new drug application, and it allows for expedited review of another drug application within six months or less. The voucher is transferable and can be sold, with recent sales averaging over $100 million. Their availability is limited, although there have been more in recent years. It's important to note that the voucher is only awarded for the first indication of a product. While Crofelemer is already approved, NP-300 is also an antisecretory agent that offers a distinct product profile, derived from the same plant, Croton lechleri, and operates through the same mechanism. In earlier studies, we conducted clinical work in Cholera with Crofelemer, which demonstrated statistical significance in reducing dehydration, the primary cause of death in cholera patients. We will follow the same clinical pathway for NP-300, utilizing the same principal investigator and clinical trial site. I did not discuss it further because, with the current challenging conditions in the industry affecting Jaguar and others, we are prioritizing transformative clinical events that can lead to revenue generation. The Cholera program is a long-term project that won't yield revenue or vouchers in 2023, so we are putting it on hold for this year. As we achieve our milestones and recognize value in the company, we will be able to advance this important program, which has a shorter duration than programs like CTD or HIV due to the nature of acute clinical trials requiring only 2 to 3 days of drug administration. Thank you for your question. Okay. Somebody asked about Canalevia for exercise-induced diarrhea in dogs. So Canalevia-CA1 is a conditionally approved product. And in the second, Ian, I'm going to let you talk about what that means specifically and how that affects our ability to educate and promote that product. But a second conditional approval for exercise-induced diarrhea. I think like I did in discussions with the Center Of Veterinary Medicine at the FDA right now. So what's being discussed and negotiated is their desire for us to do some clinical work specifically in that patient population, though it is for a conditional approval which often gives you a lot lower bar for clinical work. And again, it falls in the same category as Cholera, where we are going to put our dollars and resources in 2023 to make a revenue-generating difference in the near term? So that's still under discussion with the Center of Veterinary Medicine. Ian, do you want to talk about some of the limitations of a conditionally approved product but the excitement of what we're seeing with chemotherapy-induced diarrhea in dogs? And by the way, chemotherapy-induced diarrhea in dogs is highly predictive and analogous to the situation in humans. So it gives us, again, another reason to be highly confident about our OnTarget trial in humans the heading.

The conditional approval designation for Canalevia provides a more streamlined pathway to market. It requires a reasonable expectation of effectiveness without necessitating the full trial results typically required for traditional approval. This means it allows for quicker and less costly market entry, although there are some restrictions. For instance, it cannot be used off-label due to federal regulations that require strict adherence to the approved labeling for conditionally approved medications. In addition, the market size is limited; currently, it can only target up to 70,000 dogs in the canine sector. There is also an obligation to complete the full effectiveness trial for traditional approval within five years of the initial approval. We are actively working on this, and we anticipate achieving full approval in the future while collaborating with the CVM on the clinical development program. We are observing positive adoption of Canalevia-CA1, especially among leading oncologists, who are our primary target audience. We engage with them through various channels, including our upcoming participation in the Veterinary Cancer Society Meeting, which will provide an opportunity to educate this crucial customer group about the benefits of Canalevia-CA1.

Thanks, Ian. Okay. We have time for one more question here. We're coming up on the which we're trying to keep this to an hour. Does it which I assume is talking about Crofelemer, also work on IBS? So there are so many potential indications that reference to a pipeline within a product. There is published Phase II data for IBS, irritable bowel syndrome, with Crofelemer and we couldn't do everything. So there are target pipeline indications for Crohn's disease, inflammatory bowel disease. There are investigator-initiated trials going on right now in functional diarrhea in IBS as well. Of course, we have short bowel syndrome in CTD. So there are other indications, other important patient populations to go after in the future that would be a very risk-mitigated future drug development strategy for this company because, again, it would be indications if it's Mytesi where we already have the safety, we have the chronic safety, we have the manufacturing. How can we continue to expand the label; how can we continue to expand the population that in the health care providers that Ian can educate and promote to and grow the revenue even further. And of course, the patients that can benefit even further. But right now, we are very focused can't say it enough on cancer therapy-related diarrhea, short bowel syndrome, and MVID and other indications and other territories in the future. So with that, I know there's some other questions there. I can't get to all of them and some of them we've already referred to, again, the sentiment behind the question and the comments that we've made. Thank you all very much for listening. Thank you very much for your support for Crofelemer, Mytesi, Jaguar, Napo, Napo Therapeutics, we're going to get back to work here. It's going to be a very, very important year for all the stakeholders and we're really looking forward to what will be uncovered in the next 6, 7, 8, 9 months of this company. Thank you. I'll conclude now.

Thank you. This will conclude today's webcast. You may disconnect at this time and thank you for your participation.