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DURECT Corporation (NASDAQ:DRRX)

POSIDUR Update Conference Call

February 13, 2014 8:30 AM ET

Executives

Matt Hogan – CFO

Jim Brown – President and CEO

Analysts

Josh Regal – Stifel Nicolaus

Jason Napodano – Zacks Investment Research

Geoffrey de Sibert

Operator: Greetings. And welcome to the DURECT POSIDUR Conference. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. (Operator Instructions).

I would now like to turn the conference over to your host, Mr. Matt Hogan. Thank you, you may begin.

Matt Hogan

Okay. Good morning. Welcome to our conference call intended to provide an update on POSIDUR on our company.

Before beginning, I’d like to remind you of our Safe Harbor statement. During the course of this call, we may make forward-looking statements regarding DURECT’s products and development, expected product benefits, our development plans, future clinical trials, potential product approvals or projected financial results.

These forward-looking statements involve risks and uncertainties that can cause actual results to differ materially from those in such forward-looking statements. Further information regarding these and other risks are included in our SEC filings including our 10-Q under the heading ‘Risk Factors’.

Before I turn over to Jim Brown, two quick comments. First, recognize that we received this Complete Response Letter less than 24 hours ago. When we repeat it, we immediately gathered a small group of those who are most involved in the program to read it quickly and start the process of talking it through.

Our main initial priority was to as quickly as possible craft a press release. We’ve not had the quiet time to really digest the CRL and to have multiple discussions about it together.

We view the purpose of this conference call is that we wanted to speak to shareholders as quickly as possible, much as it might be tempting, we didn’t want to just go radio silent. But at the same time, since we haven’t had the time to really fully analyze the CRL, we’re leery about making a number of statements that we feel like revising in a week or two weeks, after we’ve had internal discussions and maybe conferred with some outside experts.

So, please bear that in mind as you understandably wish to probe for more color than we can give right now. We’re just a bit leery, speculating too much on interpreting the CRL publicly right this moment. We’ll do our best but please bear in mind that context.

With that, let me turn it over to Jim Brown, our President and CEO.

Jim Brown

Thanks Matt, and good morning everyone. I just – before I start I’d like to let you guys that I’m getting over the flu so you have to forgive my voice if I start coughing or something.

But let’s start with POSIDUR. As you saw from the press release, we received a Complete Response Letter yesterday from the FDA. They stated they aren’t ready to approve the NDA in its present form, stating that the NDA does not contain sufficient information to demonstrate that POSIDUR is safe when used in the manner described in the proposed label.

The FDA has indicated that additional clinical safety studies need to be conducted. DURECT is evaluating the issues described in the Complete Response Letter and plans to have further discussions around them.

In the Complete Response Letter, the FDA had no comments with regard to efficacy or cardiovascular safety concerns. They had no concerns on the CMC section, non-clinical the pharmacology or other sections of the NDA.

As we’ve just received the Complete Response Letter, we need time to evaluate the FDA’s issue and we’ll seek a meeting with them. I hope that within the next 60 days or so.

I can’t help briefly expressing some frustration and disappointment. We feel we ran a vigorous development program and that a delay in getting this drug to market means a lot of patients, who would benefit will have to wait.

I and my colleagues at DURECT, all feel this is definitely a product we want to love one to get if they face surgery in order to minimize the post-surgical pain and reduce the need for opioids.

We had a thought leader here at DURECT speaking last week. He’s an anesthesiologist. And he stated that one in 10,000 patients treated with opioids post surgically die from their medication. This is primarily due to having a greater sensitivity to narcotics. We are seeing 60% to 80% fewer narcotics taken in our pivotal trials. We have seen 20% more patients being opioid free after shoulder surgery and hernia surgery. There is a great need for this product.

So, we’re disappointed for the patients. We’re also disappointed for the core team at DURECT that have worked incredibly hard over the last couple of years, and countless weekends and vacations and holidays sacrificed working on the NDA and with the interactions with the FDA.

And lastly, we’re disappointed for our shareholders, many of you who have supported us for many years.

Well, thanks for letting me get that off my chest.

While we continue to pursue POSIDUR and we’ll be addressing it and answering questions you guys might have after the rest of my discussion here, we’re fortunate at DURECT to have multiple other programs that are moving forward and can create value for us. Let me touch base on those as a reminder and provide an update after which we’ll take your questions.

Starting with Remoxy, Remoxy is an abuse deterrent formulation of our oxycodone which is a widely used pain product. OxyContin does about $3 billion in sales and it provides effective pain relief for chronic pain patients but unfortunately this misuse at the rate that the FDA has repeatedly described “as a major public healthcare concern”.

Our ORADUR technology is what confers under Remoxy, it’s multiple layers of abuse resistance. There’s snort reduction, snorting, injecting, inhaling, chewing and mixing it with alcohol. We think multiple layers of abuse resistance built into Remoxy make it a compelling pain product and that Pfizer will be do an impressive job when it’s approved.

They have a major presence in the pain space with Celebrex America, and with Remoxy Pfizer have a product design to be effective for legitimate pain patients. With the features that are designed to reduce abuse by illegitimate users.

Prescribing physicians get the comfort of knowing it will be an effective pain product without having to worry about writing prescriptions that lead to diversion and misuse.

Patients won’t have a stigma telling anyone they’re on OxyContin yet they will get the effective pain relief from a two twice-a-day gel cap. With Pfizer’s large sales force, they should do very well with this product once launched.

I’d also like to note that we have multiple patents that go out to 2031, so there would be a long period for our shareholders to gain a return from Remoxy. It’s a late stage asset, and that to safety and efficacy of Remoxy have been shown conclusively. And the remaining task that is needed is to address the manufacturing related issues that led to the FDA giving Remoxy’s last Complete Response Letter.

In March of last year, Pfizer met with the FDA to share the extensive work that they’ve been doing on Remoxy and to propose a path forward. The FDA agreed to Pfizer’s proposal, namely that there is no need to replicate the earlier Phase 3 work, if a bridge study was done to link the data from the current formulation vis-à-vis a bioequivalence study.

In October of last year, after a thorough review, Pfizer announced their decision to move forward with the steps required to submit, resubmit Remoxy and they are driving the program forward.

Specifically, there are three clinical trials that are required for this resubmission. The first is a food effect study, the second is an abuse potential study and lastly a pharmacokinetic or bioequivalent study.

The food effect study was initiated in August and completed last October. The abuse potential study with the new formulation was started per clinicaltrials.gov in November of 2013. This is listed as being a 60-patient study with a target completion date of June of this year.

In a conference call that Pain Therapeutics held last week, they stated that they understand that roughly 18 to 20 subjects were enrolled at this point.

Finally, the pharmacokinetic bioequivalent study just show that the new formulation performs in vivo like the old formulations such that there is a bridge back to the successful efficacy of safety data that the FDA is already seeing. And in the study of this type of Remoxy was posted on, by Pfizer at clinicaltrials.gov this week.

We think the probability of success in these studies is high for a multiple of reasons. First, a smaller bioavailability study is already been done by Pfizer and those results supported moving towards the BE study. In other words, BE study is basically a larger former version of the BA study that’s already been completed to Pfizer’s satisfaction.

Second, the changes of the formulation were extremely minor. Hence we won’t expect the abuse liability potential study to turn out any different from the study previously done by King Pharmaceuticals, that study met all of its end points.

Pfizer stated resubmission date is no earlier than mid-2015. We believe that as the month’s tick by and the resubmission date is closer, more and more investors will have to factor this program more prominently into their thinking. And the discount we’re currently seeing for this program will begin to decrease.

The review period is six months, so our expectation is for the approval of this product in late 2015 and launch shortly thereafter. As a reminder of how the impactual and transformative this could be for DURECT, we will receive a royalty of 6% to 11.5% of Remoxy sales.

Hence, if Pfizer captures 30% of the roughly $3 billion market that exists at about $900 million, we think – and we don’t think that’s unreasonable. We would have an annual royalty stream of around $72 million.

I’d also like to note that over – with over $250 million in NOLs built up when the royalty starts to kick-in, we won’t be paying taxes for some time.

Now, briefly move to ELADUR. We are pleased to start the year by announcing our collaboration with Impax, and the resumption and development of the ELADUR patch. Let me first remind you about ELADUR. It’s a pain patch that is being developed for post-herpetic neuralgia.

It’s a three-day patch versus a 12-hour Lidoderm patch or lidocaine patches. This is more than a convenience matter. As it’s been reported that two thirds of patients have breakthrough pain for 12 hours when the lidocaine patches are off.

So, this could be a meaningful patient benefit and efficacy advantage. In addition ELADUR has a patient friendly design, in contrast to the skin it won’t fall off easily and the patient can exercise when they go for a swim or take a shower.

A brief history on the product, we originally designed it for post-herpetic neuralgia that is pain that’s caused by inflamed nerves near the surface of the skin. We had a successful 60-patient Phase 2 trial for PHN with ELADUR which led to partnering it years ago with Alpharma.

Alpharma was then then purchased by King Pharmaceuticals. King took the program in a different direction and launched into a large Phase 2 study in lower back pain, chronic back pain without doing any preliminary work in back pain or selecting patients with a particular etiology of back pain.

There was a nice pain effect in the first several weeks of the study, which maintained for the full 12-weeks duration but it wasn’t distinguishable from the effect of the placebo patch.

King meanwhile was purchased by Pfizer and they ultimately returned the rights to us. Our goal all along has been to develop this product for use that it was originally designed for that is post-herpetic neuralgia.

In January, we announced the licensing of this product in an exclusive world-wide deal with Impax. They share our vision for the right way to develop ELADUR. The terms of this deal are $2 million upfront, $31 million in development milestones, the next of which is starting Phase 3. $30 million in sales based milestones.

Impax will fund all development and commercialization and DURECT gets the share of sub-license fees that would be received by Impax. We get a tiered single digit royalty to mould double digit royalty.

For those who may not know Impax all that well, they’re $1.5 billion market cap company, and in addition to the generics business they have a business focusing our branded products in CNS base, which is where ELADUR fits in.

We happen to know the project team leader at Impax, having worked with them and another product another company, years ago. And we’re very confident that they’ll drive this program forward aggressively.

In terms of next steps for the program Impax wants to do a short proof of concept study, followed by meeting with the FDA to discuss the structure and design of the proposed Phase 3 program. And their hope is to start the Phase 3 program later this year.

As a reminder, we have an orphan drug designation for ELADUR for PHN. And we have an issued patent in the U.S. going to 2031, and an issued European patent that goes to 2027. We’re pleased that ELADUR is back in development with Impax and that we have another attractive asset in Phase 3 potentially this year.

Next is regard to Relday. Relday is a large commercial opportunity, it features a once-a-month risperidone product. It’s a patient friendly opportunity for the treatment of Schizophrenia. It’s a subcutaneous versus the market leader out there which is an IM injection.

We’ve got some very good data – positive data from our Phase 1 trial that encompasses the full dose range expected for clinical use. It is partnered with Zogenix. They plan to initiate a multiple dose trial in the second half of this year. This is a brief reminder with regard to our Zogenix collaboration on Relday. We received $2.25 million upfront, $103 million in potential milestones, $28 million which are development and $75 which are sales based.

DURECT gives a share of sub-license fees received by Zogenix. Zogenix funds all the development and the commercialization and the royalty back to DURECT is similar to what we just described for ELADUR that is mid-single-digits to low double-digits.

With regard to the ORADUR opioids, in late October of last, Pain Therapeutics regained the rights from Pfizer 2003 other opioids with our order technology. These are hydrocodone, hydromorphone and oxymorphone. All three of these have active INDs in place with the FDA. And Phase 1 work has been done in the past with hydrocodone and hydromorphone.

Future development of these will definitely benefit from our Remoxy experience. Pain Therapeutics hasn’t stated that they’ve made a formal decision about developing our out-licensing in these assets. But they did make some comments last week during the conference call. So, I’d like to describe their comments.

First, they seem to prefer hydrocodone and hydromorphone over oxymorphone. Second, they mentioned that there may be able to have one or two of these in Phase 3 at about the time when Remoxy is resubmitted that is middle of 2015.

They went out to mention that they are considering an approach for hydromorphone that might not require a Phase 3 trial. But they of course have to get that strategy with the FDA first.

We are in active dialogue with Pain Therapeutics around these programs and we are doing work as we speak. We think these programs have a lot of potential to move quickly if Pain Therapeutics commits the resources to them. And they represent a value stream that may not be credited at the current moment. But over time we should as an advance in development.

As a reminder, we get the same economics on these programs so as to do for Remoxy that is 6% to 11.5% royalty. PTI would pay for the programs and there are additionally another $6.1 million in pre-sales milestones that are spread across the three programs.

With regard to the ORADUR ADHD program, the lead formulation demonstrated the following in the Phase 1 study that was conducted last year. A rapid outset of actions, long durations for once-a-day dosing, to small capsule size compared to the leading products around the market and of course it has a tamper resistant of the ORADUR technology, the tamper resistance.

Orient Pharma have had discussions with the Taiwan FDA to outline their Phase 3 program and they are developing plans for the Asian and South Pacific territories. We had direct retained the European and in U.S. and Japanese rights for this product. And we have begun to have licensing discussions with this new formulation in-hand and the supporting PK data.

We intend to discuss the development program with the FDA to see if we can follow something similar to what Quillivant XR this is the next weight product. That was approved with less than 100 patients.

So, just to wrap it up, let’s review potential key drivers for DURECT over the next 12 to 24 months.

For POSIDUR, we’ll meet with the FDA to clarify, addressing the Complete Response Letter. We’ll start activities towards resubmission. We have the potential for doing a licensing deal. With clarity from the FDA meeting, this is a very valuable late-stage asset.

For Remoxy, Pfizer will be conducting the required studies that is completing the BE and the abused potential studies. And then resubmitting sometime in the mid of 2015 followed by a six-month review and then potential launch of the product.

For ELADUR, it’s initiation of Phase 3 by Impax in late 2014. For Relday, it’s initiation of multiple dose trial by Zogenix in the second half of 2014. There is potential for PTI order program advancing in the Phase 3. The potential for new collaborations of course with POSIDUR, with sufentanil patch with ORADUR-Methylphenidate or from one of our feasibility programs.

Additionally, there is a potential for a new program to enter clinical development this year.

With that, I want to thank you. And we’ll now take your questions.

Question-and-Answer Session

Operator

Thank you. (Operator Instructions). Our first question comes from the line of Annabel Samimy. Please proceed with your question.

Josh Regal – Stifel Nicolaus

Hi guys, this is Josh Regal hopping in for Annabel. So no surprise I’m going to ask about POSIDUR. You mentioned that your CV risk was for the most part was okay. Can you kind of just give us a better idea of what safety signals are of concern? Is there any issue with the 600 mgs of bupivacaine versus lower dosings that are being used elsewhere and then obviously what type of study you might be thinking about and a bit of a timeline?

Jim Brown

Yes, so, yes, that’s I think it’s a very good point. And I’m glad you brought it up. They haven’t raised any concerns with regard to cardiovascular safety. I think we showed that in spades we have 300 patients that had Halter monitors that were worn out of our best trial. They all are more than for three days. And they had 16 plasma drugs and we showed no difference between our group and the placebo group.

And so with that plus the other patients that we have at cardiovascular information on. So, none of their questions were surrounding the 600 milligrams of bupivacaine. The question with regards to safety, excuse me, are more – they’re just simply kind of imbalance of observations that were made from the trials.

An example, I’ll give you and as Matt said, we demonstrated all these in particular the great detail, but somnolence which is sleepiness. We – when they compare, they’re happy to compare positive for efficacy against our SABER bupivacaine placebo which is SAIB plus the benzyl alcohol that was fine for comparing efficacy.

But when they look at safety, they want to compare our positive group against hydrochloride. And we didn’t have that many bupivacaine hydrochlorides – we didn’t that many of those patients in our trial. We had about 100 in the whole program of over – I don’t know how many patients, we had about 700, 800 patients total.

And so, when you – and they were then associated with particular surgeries where bupivacaine hydrochloride was used as a control. And so, what the FDA did is they compared all of the POSIDUR side-effects such let’s just take sleepiness as an example. So they took sleepiness from all of the POSIDUR groups. And they compared it with sleepiness seen from the hydrochloride group.

So, hydrochlorides were in different patients in different trials and the data where side-effect profiles were collected differently. The hydrochloride patients were younger patients but had shoulder surgery or maybe gall-bladder surgery or something like that versus the more of the excuse of the POSIDUR groups were, like the colon cancer patient, diverticulitis patients that took more narcotics. And the narcotic side-effects were collected in a different way from those trials.

We really very scrupulously looked at those kinds of things. So we ended up with gathering more somnolence or sleepiness data on the POSIDUR groups out of the colon cancer patients then was collected just because the observations weren’t made. And the patient didn’t take as much narcotics in these other trials, where the hydrochloride, bupivacaine and hydrochloride was used.

And so that left a potential for imbalance. In reality, it didn’t because when we broke that – I just looked in that trial the POSIDUR groups against the hydrochloride groups you didn’t see any difference. But the FDA is concerned about not just the apples-to-apples but the apples-to-oranges, the overall grades of just the hydrochloride group.

And so, what they’re asking for is some additional safety information, simply to get the numbers up so they can do a fair comparison. And from where I sit today that’s where I’m looking at.

There was one side-effect where we did see more of it. And we’ve acknowledged this longer and that is we do see a little bit more discoloration in certain surge of the models, in particular around the larger abdominal wounds. You don’t see it in the hernia trials, we didn’t see it in the shoulder trials. But in the large abdominal surgeries we do see a higher rate of discoloration I had my appendix out few years ago.

And I don’t know if guys have had abdominal surgery, but you can end up with some discoloration around the wound. This is simply a cosmetic thing. It’s self-limiting. It goes away, it’s just blood under the skin basically that is reabsorbed over a number of weeks. And it looks just like any other kind of bruise where it goes yellow and then green or green and then yellow, and then eventually is absorbed and goes away. So it’s not anything that’s going to change anybody’s life.

Josh Regal – Stifel Nicolaus

Okay. So, if that’s the case what kind of trial would you initiate to kind of address the somnolence?

Jim Brown

I use somnolence as an example, there are a number of other ones they listed, it’s like pruritus which is itching and that kind of thing. So, what we’d have to do is put a trial together where we would compare POSIDUR against either hydrochloride probably bupivacaine hydrochloride or some other placebo. And just simply look at those rates.

And so we have to sit out with the agency and define that’s why I can’t kind of get into how many patients you’d need to determine that – we need to sit down with some experts and define that and then do it. But it’s not the same as having to have to go out and prove additional efficacy and those kinds of things. It’s a different thing and so we’re still exploring it obviously.

The time and cost, I know you asked that question. We really can’t speak to it at this point in time. It certainly is going to be more than a year, I would it’s probably a couple of years at least to deal with it would be my guess at this point in time. I’m hoping less but just being realistic, and the money will be determined by the number of patients.

Josh Regal – Stifel Nicolaus

And so just to be clear, and then I’ll let other people get on right after, you have no efficacy trials planned they would just be safety trials?

Jim Brown

Well, they would be safety but we will collect the efficacy when we collect the safety information for sure.

Josh Regal – Stifel Nicolaus

And they could be used for resubmission?

Jim Brown

Yes. And what we’ll do is we could get additional marketing information out of this, if we do a lot more work against hydrochloride then we’ll have a lot stronger data. So, we already have I think three trials where we have really good efficacy against hydrochloride which is something that as you know Pacira with Exparel have not been able to demonstrate.

And so I think that would be a strong one for us. So we can gather some additional information there. So, we’ll not only have the 272 hours but we’ll have a lot of good active comparator data when we’re done with all this.

Josh Regal – Stifel Nicolaus

Okay, great.

Operator

Thank you. Our next question comes from the line of Jason Napodano. Please proceed with your question.

Jason Napodano – Zacks Investment Research

Hi, guys, thanks for taking the question. Let me just try to build a little bit more on kind of the previous line of questioning. And correct me if I am wrong, it kind of seems like the issue is a lack of safety data or a lack of this kind of head-to-head comparison data with the active comparator versus a specific safety issue that they were harping on, is that kind of what I am hearing?

Jim Brown

I think that’s a fair statement. Because if you look at it, it’s just kind of a laundry list of these kind of I don’t want to use one-off but these kind of imbalance observations as well. It is, it is lack of enough data for them. If we had 200 hydrochloride patients or 300 or whatever they wanted to see, against those we would have been fine.

I think that the kind of squeeze that we ran into is they wanted to see efficacy against SABER placebo, which we gave them. But then they want to see safety against kind of standard of care. And so…

Matt Hogan

That’s for some other comparison doesn’t include SABER.

Jim Brown

Right.

Jason Napodano – Zacks Investment Research

Got you. Okay. Were any of these imbalances systemic issues or was it all?

Jim Brown

Well, actually they’re pretty much local but you have to say somnolence right, sleepiness is the systemic concern right, but it’s a narcotic, in reality it’s a narcotic side-effect. But if you have different kinds of trials, you’re going to get different rates of that. Primarily they are local kind of things. Yes.

The one imbalance is the discoloration seen in the abdominal surgeries but the FDA did come out with new guidelines last week. I don’t know if you saw those, what they said that the two areas of these guidelines are pain control. They said the two areas were, the felt they would be willing to look at more broadly at side-effects and the like would be in the areas of cancer pains and large abdominal surgery. And we’ve shown really nice efficacy in large abdominal surgery.

If you look at the sit-up pain from our colon cancer patients, we win 0-72 hours, beautiful pain reductions, statistically significant. I think that’s a very important piece anyway.

Jason Napodano – Zacks Investment Research

Jim, you mentioned no CMC issues, I guess pharmacology concerns, was there anything in there that related to efficacy? Were there any kind of efficacy questions listed in the Letter?

Jim Brown

There was no, there were no efficacy questions in the Complete Response Letter. The only time the mentioned efficacy they said collect, when you collect the safety data, also collect efficacy data while you’re doing that.

Jason Napodano – Zacks Investment Research

Okay. And when the FDA…

Jim Brown

Sorry, I mean, because we expected if you’d got any questions it would be on the lines of efficacy or cardiovascular safety right because those were what we did, so.

Jason Napodano – Zacks Investment Research

Yes, no, and so we does ask one question about that. When the FDA is reviewing these applications, if they get to the point where they are seeing, and I don’t want to see a safety concern but they are seeing a lack of safety data or they see these imbalances that you mentioned, does that kind of prohibit, maybe inhibit them from doing a thorough efficacy analysis. Do they get to the point where they look and say well, we know we are going to issue a Complete Response Letter because we’re not seeing enough safety, so why worry about efficacy?

Jim Brown

By definition, a Complete Response Letter is supposed to be a Complete Response Letter, right. It’s supposed to be all the issues that they have and that’s defined by law. So they’re meant to give us all of their concerns.

Matt Hogan

We also know for example that they did inspections to a couple of clinical sites as part of their value. I think whatever they’ve given us here, that’s meant to be what it is.

Jason Napodano – Zacks Investment Research

Got you. Okay. Fair enough, guys. Thanks a lot. Appreciate it.

Jim Brown

Sure.

Operator

Thank you. Our next question comes from the line of Geoffrey de Sibert. Please proceed with your question.

Geoffrey de Sibert

Good morning gentlemen. Circling back again around the past two questions, Jim, you made an attempt to put a vague timeline, you said well at least one year, more likely to years, would you see that as being kind of the window for resubmission or just the window to actually get whatever studies need to be done?

Matt Hogan

Geoffrey, it’s hard to say. We’ll meet with the agency in a couple of months. And once we know what they want to see we’re going to obviously sit down with consultants between then and now play out a strategy for conducting these studies. And then once we’ve done that then we’ll have to go to the IRB. And get these things approved and get them out of way. I think we could, we should be able to get them underway this year I would think. But then as to how long it would take, it depends on how many patients and the type of surgeries and the like.

So, I just – I don’t know for sure, that’s why I’m kind of being big. Once it’s resubmitted, it will follow all resubmissions as we so well know from Remoxy and so that would be a six-month review which is something I guess.

Geoffrey de Sibert

All right, thank you. And in terms of, or in the last two calls you have shared with us the fact you have been in a multiple discussions with prospective partners on POSIDUR and that many of them are waiting to see what the outcome of yesterday’s decision would be. Do you view the nature of the concerns raised by the FDA in the CRL as being particularly either positive or negative for any discussions that you have had with prospective partners?

Jim Brown

That’s a good question, I think that it’s limited as I said to the kind of lack of I love the term, the lack of data with regard to some of these imbalances with regard to some of these safety observations. So my belief is there are number of potential partners. There are certainly our group that were waiting just for approval and they would like to help us celebrate that’s one group.

And then there a number of others that will take a hard look at the minutes from the FDA meeting, some can give us some of their thoughts going into the meeting. And then post that the potential for partnership in the near term I think exists.

Matt Hogan

But I think Geoffrey, the key is going to be, can we extract for FDA clarity of what we need to do going forward. that would allow we and somebody else to figure out how long that will likely take, how much that would cost and what the probability of success is.

Jim Brown

Right.

Matt Hogan

Partnered with that an outside party can do our evaluation with us and so first step and being able to answer that question of probability of partnering.

Geoffrey de Sibert

All right, and so, will the company undertake to share with its shareholders as promptly as possible the outcome of that meeting with the FDA so that we as long-term shareholders can have a better feel as to what it’s going to take to get POSIDUR past the goal line?

Jim Brown

Yes, I think we would view that as our duty as soon as we feel like we have clarity to sort of describe to people.

Matt Hogan

Absolutely.

Geoffrey de Sibert

All right. Thank you.

Operator

(Operator Instructions). There appear to be no further questions at this time. Would you like to make any closing comments?

Matt Hogan

Well, just very briefly. Thank you all for calling in. I know people on the East Coast were very inconvenienced by the weather. And management is around and happy to talk to people to the extent we can be helpful. So with that I guess we’ll just sign-off. Thank you.

Jim Brown

Thank you.

Operator

This concludes today’s teleconference. Thank you for your participation. You may disconnect your lines at this time.

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