DARA Biosciences (NASDAQ: DARA) is a specialty pharmaceutical company focused on oncology and oncology support products. The company has created some buzz as of late, landing on several 'watch lists' after the company's acquisition of Oncogenerix in January 2012 and exclusive licensing of three market-ready products for distribution in the United States. In recent weeks, the North Carolina-based company announced it had regained Nasdaq price compliance and remains on schedule for distribution of its lead product, Soltamox, in Q4-2012. Soltamox is an FDA-approved oral liquid tamoxifen indicated for breast cancer licensed from Rosemont Pharmaceuticals, LTD, a UK-based manufacturer and marketer of oral liquid medicine. It is sold in the United Kingdom, and is estimated to reach peak sales of $25MM. Tamoxifen in tablet form is a widely-used drug in the treatment of breast cancer, and Rosemont has reported the liquid form can penetrate between 2-5 percent of the share of the tamoxifen market. The oral liquid formulation represents a favorable option for patients with dysphagia, a common side effect of chemotherapy and radiology. The company's additional in-license portfolio includes Bionect, a hyaluronic acid cream and gel indicated for the dressing and management of dermal ulcers and first and second degree burn. Bionect is licensed from Innocutis Holdings and will be marketed to radiologists and oncologists in the second half of 2012. DARA Biosciences' newest product is Gelclair, an FDA-approved oral gel for the treatment of oral mucositis, licensed from Swiss-based Helsinn Group. The company announced the exclusive license in September, with a plan to launch first quarter of 2013. CEO/Chief Medical Officer Dr. David Drutz and COO Chris Clement conducted a two-part interview with OneMedRadio discussing developmental milestones and key catalysts for Q4-2012 and 2013. In Part I, the two executives provide insight on the company's in-licensed portfolio, the market opportunity in this space, and the importance of a diverse pipeline that includes oncology therapies and oncology supportive care products. Listen to the interview, and view the transcript below. Matthew Margolis: Greetings from OneMed Radio, I’m Matt Margolis. Today, I’m with Dr. David Drutz, CEO and CMO of DARA BioSciences as well as Chris Clement, the company’s Chief Operating Officer. DARA BioSciences is a publicly traded market stage specialty pharma focusing in oncology. DARA BioSciences has an exclusive license to market Soltamox, an oral liquid tamoxifen for the treatment of breast cancer in the US, with an expected launch in 2012. The company also plans to launch two additional in license drugs in late 2012 and early 2013. DARA BioSciences trades under the symbol D-A-R-A on the NASDAQ. So maybe we can start with a history of the company, what makes DARA BioSciences unique? David Drutz: Well DARA BioSciences is a little bit more than ten years old and it’s been a public company for about five years. DARA was previously focused on the in-licensing and development of preclinical or clinical products taking them to preferably a phase 2 inflection point and then out-licensing and repeating the process. But in recent years, it’s been very difficult to interest pharmaceutical partners in early stage clinical data and therefore the demands on the other side of the table were growing and growing. I had, this is David, been a member of the board of directors for several years as an independent director. The previous president and CEO retired in December of 2012 and at that time I was asked to take over the company by the board and agreed to do so with the proviso that we move more into the commercial space because this is a more favored place for investors to be and it addressed the issue of the difficulty of taking preclinical and early stage compounds to a partnering inflection point. Consequent to my appointment, an opportunity came along relatively quickly to acquire a small private company in South Carolina called Oncogenerix. CC, our COO, was the president and CEO of Oncogenerix. Oncogenerix as you can tell from its name was focused on oncology drugs and one of the drugs that Oncogenerix had rights to was Soltamox, which we’re going to be talking about a little bit later. Chris and I met, we liked one another, we liked the prospects of putting the two companies together. We did it. We raised money to finance what was now going to be a nascent commercial company and that’s how we got to where we are today. So what makes us unique? We’re now a specialty pharma and we are clearly focused in the oncology and that would be Soltamox, but also the oncology support space because the other products to which we’re currently directing our attention treatments for the complications of the drugs that are used to treat cancer or complications of the cancer itself. MM: It’s a perfect segue. So let’s talk a little bit about Soltamox and what is the active agent here and why is it a perfect alternative tablet? Chris Clement: Tamoxifen has been available since 1998. It’s one of the leading treatments in breast cancer therapy today and it’s only been available in tablet form until now. Soltamox is an oral liquid solution that patients will take on a daily basis, similar dose to what they’re taking with the tamoxifen tablets. In breast cancer, a lot of these patients are postmenopausal, a lot of them get radiation and surgery as part of their overall treatment and each one of those events, the being postmenopausal, having surgery, and radiation cause either on an acute or on a chronic basis some level of swallowing difficulty. Swallowing difficulty or if you want to be technical about it call it dysphagia is the difficulty or the inability to swallow. So in a lot of cases even something as small as a tablet makes it very difficult for these patients to be compliant on a regular basis and with tamoxifen patients are taking this drug daily for a number of years. So compliance and adherence to therapy becomes very important. So we believe that there is a portion of those patients who do have swallowing difficulties because of the reasons that I mentioned or they simply want to know alternative to tablet therapy. So we think that this is really a very nice option now for those patients. Because this situation with patients who are left with taking tablets and do have swallowing difficulties if they can’t, they have to make a tough decision and some of them are probably intermittently taking their tablets so they’re not taking it on a regular basis or they’re potentially skipping the dose altogether and because it’s a chronic treatment, that’s not good for the patient. So we think for that portion of the patient population that does have swallowing difficulties, this is a much needed treatment option. MM: I understand that Soltamox is marketed in the UK. Can you go into some detail about the sales there? CC: Soltamox has been available in the UK for a number of years. It’s sold by a company called Rosemont Pharmaceuticals. They’re one of the leading manufacturers of oral liquid products in the world. They have a portfolio in the UK of over 50 products, oral liquid products that they sell. Typically, what they find is that they can get somewhere between 2% to 6% or so of the population that’s taking oral tablet therapy and switch them or patients would prefer to take oral liquid therapy. So in the UK, they’ve been able to achieve around a 2% market share and on a similar basis, you know, we believe that in the Unites States that our market share of patients will be somewhere in the 2% to 3% range. So we view this as a needed option in the market. We’re not saying that Soltamox is going to replace tablet therapy. If patients are compliant and they have no issue in taking their tablet then there’s no need for them to switch unless they obviously want to. But for that portion of patients that do have swallowing difficulties, consistent to what the UK has done, we believe we’ll be able to achieve that 2% to 3% market share. MM: Interesting and so what is the next step in bringing Soltamox to market? CC: Well we’re very proud to launch Soltamox in conjunction with breast cancer awareness month. October is breast cancer awareness month. You see a lot of campaigns that are out there in raising awareness and recognition of breast cancer. Breast cancer continues to be a serious problem in this country. Around 230,000 new patients are diagnosed each year and it remains the second leading cause of cancer death among women. So it continues to be a major problem. We’re very pleased to launch Soltamox here in October. As we launch the product and we make it available nationally through pharmacies and through our network of sales force and other partners, we are making a number of unrestricted grants to breast cancer foundations to help raise awareness. MM: Great. And let’s turn to your additional products in your in-license portfolio. You recently announced an agreement with Helsinn to market Gelclair in the US, what is the technology here and why did this product become the next product to acquire? CC: Gelclair is a bio-adhesive let’s say and it is a product that patients will take right before they eat or drink. So typically, a patient will take Gelclair for breakfast, lunch, and dinner and what it does is it provides basically a protective barrier in the mouth so that the patients can eat or drink. This is targeted at patients that have a condition called oral mucositis. Oral mucositis is largely caused by a lot of the cancer treatments that patients are getting and it results in wounds and sores in the mouth, open wounds and sores in the mouth. You can imagine how painful it would be to try and eat or drink if you have to deal with these open wounds and sores. So Gelclair is actually sold as a sachet. So patients will open the sachet, they’ll put it in some water, and they will rinse their mouth with it like a mouthwash and they’ll do it prior to eating or drinking and the Gelclair will protect the wound and the sores so that these patients can eat and drink as normally as possible. So it really does provide a much needed benefit to these patients. It also contains an ingredient hyaluronic acid and hyaluronic acid is known to have properties that aid in healing. So we believe that it’s a good thing not only to help patients protect their mouths with the bioadherent, but the availability of hyaluronic acid as well is good to hopefully see these patients begin to improve over time. So that’s basically what Gelclair is. There’s around 400,000 patients currently estimated in this country that have oral mucositis. We think similar to Soltamox, it’s a much needed product. Now you asked the question about how it fits into the portfolio, well interesting from a strategy and a synergistic perspective if you think about that breast cancer patient that we could potentially get on oral liquid therapy with Soltamox, a lot of those patients are also taking chemotherapy or other cancer treatments that could cause oral mucositis. So, you know, in a way when you see that breast cancer patient that’s undergoing other treatments as well, they may also have oral mucositis. So it fits in very strategically with the direction that we went to head in and that’s oncology treatment and supportive care products and Gelclair is an ideal supportive care type product. MM: And what about Bionect, who will this be marketed to? CC: Bionect is also a supportive care product and it fits right in with what we just talked about. Bionect is a product that is targeted primarily to radiologists but some oncologists as well. This is a product that is used to protect the skin from the damages of radiation. So if you think about what happens when patients get radiation, some of them end up with severe burns like a bad sunburn. What happens in some cases is that the radiation, we call it radiation dermatitis, the burn is so severe that patients have to interrupt their treatment. So they have to stop their radiation treatment for a while until the burn clears itself. Bionect is also a hyaluronic acid based product and it’s available in a cream and a gel and when used prophylactically it gets down, it’s a low molecular weight product, hyaluronic acid product, it gets down, penetrates deep into the dermis and it allows for protection of the skin. So a radiologist, a physician will start a patient on a product like Bionect prior to starting radiation and hopefully protect the skin to the point that the patient won’t have to interrupt therapy and that’s very good for all involved. In a similar way, I’ll go back to my breast cancer patient that is a potential candidate for Soltamox therapy, a lot of breast cancer patients get radiation as well. 90% of patients who get radiation are also going to have some form of dermatitis so in a similar way we think we can also offer a very useful supportive care product like Bionect to that patient undergoing radiation treatment. Strategically for us and from a synergy point of view, it fits in very nicely, a very nice portfolio of products because our entire portfolio of products could potentially be used in the same patient. DD: So Matt, part of the logic behind why we did the merger with Chris’ company and emerged as a commercial company is that DARA had in its original pipeline an oncology or a cancer support product for the treatment of the nerve damage that occurs from a whole variety of anticancer drugs. It’s called chemotherapy-induced peripheral neuropathy or CIPN. No one fully understands why the nerves are damaged by otherwise very valuable cancer drugs, but the fact is it happens and it can be severe and actually disabling. So we have a product in development that fits the scenario of the emerging DARA BioSciences because it’s a chemotherapy-induced peripheral neuropathy, which means cancer support therapeutic drug. It just has a designator right now KRN-5500 and that it means it came from Kirin actually in Japan that’s why it has the designator. But I just wanted to get it into the conversation because it was part of the rationale for why we decided to put the two companies together. We regard this product as being a potential hockey stick value driver for the company long term. MM: That’s was a snapshot of DARA BioSciences’ portfolio and lead products with Dr. David Drutz, CEO and CMO as well as Chris Clement, Chief Operating Officer. Stay tuned for Part 2, for a discussion of DARA BioSciences’ clinical and financial milestones. With OneMedRadio, this is Matt Margolis signing off.