Good afternoon, everyone, and thank you for joining us for another session at H.C. Wainwright's annual Global Investment Conference. My name is Eduardo Martinez. I'm a biotechnology equity research associate at H.C. Wainwright, and it's my pleasure to introduce Dr. Geoff Dow, CEO of 60 Degrees Pharma. Dr. Dow.
Thanks, Eduardo. Good afternoon, everyone in the room and on the web listening into this presentation. 60 Degrees Pharma is focused on development and commercialization of small molecule therapeutics to treat and prevent vector-borne disease, and I will be making some forward-looking statements, so every CEO of a micro-cap biotech company thinks their stock and company is undervalued and underappreciated by the investment community. In our case, we joke internally that we might actually be the smallest market cap Nasdaq-listed company with a commercially approved product. That product is ARAKODA for malaria prevention, which was approved back in 2018. The current management team were the same team that got that drug approved by the FDA, so we feel we're very well positioned to expand the label to support new indications, which I'll tell you about in a minute.
What I'm here to do today is show you how we'll grow top-line sales over the next few years and expand our market cap in doing so. First, I just want to show you a little bit of the sales history of ARAKODA, which went into the U.S. supply chain in September of 2019. It was extremely good timing for a travel medicine product because about three months later, this thing called the pandemic hit us and completely, basically shut down our opportunity to commercialize the product because there was no travel. This is a product to prevent malaria and travelers. As the pandemic was ending, we started getting phone calls from patients, and these patients had a condition that they described as chronic babesiosis. When we looked in the medical literature to find out what that was, no one had ever described it.
But our sales kept increasing, eventually prompting us to take a bit of a market research look to see what was going on here. And we found out that maybe 70% of our sales were actually for this new disease that no one had ever heard of. Sales continued to increase, except for a blip earlier this year where we had a supply chain disruption. And you can see from the subsequent increase in sales that that has largely been resolved, which has allowed us to start actually a commercial pilot program for malaria prevention, which is the approved indication for the first time, even though the product has been on the market for about six years. I'm not going to spend too much time on the P&L metrics, except to say that our gross margin has stabilized as our volume has increased at about 50%.
Our rate, even though we don't report net revenue as a percentage of gross sales or report gross sales, you can back into the numbers, and that metric looks at about 50% or higher. If we can get to scale, we're going to be profitable. How do we get there? We've done extensive market research on both the core approved indication of malaria and that chronic babesiosis. When in the year our patent life runs out for ARAKODA in 2035, it's possible we could get to over $200 million in sales. When we look at what contributes to those future potential sales, it's malaria prevention potentially contributing about 20%, a small additional market in acute babesiosis, but then the large chunk of it is for this new disease, chronic babesiosis.
In our market research, our questions to physicians and patients have been predicated on additional labeling for ARAKODA for babesiosis. I'll get back to babesiosis later in the presentation, but I just want to spend a few slides focusing on the core approved indication of malaria. This is a case from an ordinary American in the Washington, D.C. area, a Fox News presenter, visited Indonesia for a vacation and came back with a nasty dose of malaria, which required hospitalization and IV treatment with antimalarials. Unfortunately, this person's experience is not isolated, and we know that malaria cases and returning travelers are increasing over the years, and that's primarily for two reasons.
One, there are no vaccines, which means you have to take oral meds daily or weekly throughout your travel and then for a period of time when you come back to prevent relapsing malaria when you return, and then the other point here is that most of the cases of malaria in returning travelers are actually people who didn't take their meds. There's a reason why people don't take their meds. It's really complicated. For example, the biology of the parasite isn't straightforward. There's two main species, and they're in different parts of the world, and they have different biological effects on the body. Vivax malaria isn't that deadly, but it does form a cyst, if you like, in your liver and causes relapsing disease.
The medications you use to treat that part of the life cycle are different from the ones you use to prevent contracting falciparum malaria, which is a deadly parasite that is most frequent in the places where vivax malaria isn't. Layered on top of that is drug resistance. Both these parasites have resistance to many of the generic alternatives to ARAKODA. If you want to take standard of care, you have to take three combination drugs and sequential combination of 53 pills. This is for a month trip. With ARAKODA, it's 16 tablets. The reason why we can do that is because it's a broad-spectrum product that works against all the different kinds of malaria. The two-week half-life of the drug allows infrequent administration, so you can dose it weekly during travel.
When Kristen Landon, our Chief Commercial Officer, joined the company at the beginning of 2024, she led a market research effort to try and plan and focus what our commercial pilot program for malaria prevention was going to be. Interviewing healthcare providers and patients, we found that brand recognition was unsurprisingly low for a product that had never had any commercial muscle put behind it. We found that healthcare providers and patients liked the product profile. There were some concerns about the lower cost of generic alternatives, but also a core group of people who are willing to pay more money for a product that has better features and benefits. And then, of course, the requirement for G6PD testing to safely administer the product is a barrier for some patients with a short travel planning horizon.
So, our commercial program, which we've partnered with IQVIA, a large commercial sales organization, has three components. One is an electronic outreach program to promote the awareness of the brand. The second is two inside sales reps to directly contact physicians. And the third is a copay assistance program just to knock back the sticker price of ARAKODA a little bit for insured patients. We think the data from this commercial pilot program will come out towards the end of this year, allowing us to make some decisions about scaling up or scaling back early in 2026. So now I'm going to shift gears and share some information about our babesiosis program. Babesiosis is a lot like malaria in the sense that it's transmitted by a vector. In the case of babesiosis, that is a tick. It's the same kind of ticks that transmit Lyme disease.
There's often a co-infection with Lyme disease and babesiosis. It has a common disease pathway with malaria in the sense that it infects red blood cells. It cycles through the red cells, bursting them, and that trigger of antigens into the bloodstream triggers the common flu-like symptoms of acute disease of both malaria and babesiosis, and also causes the severe anemia that can lead to hospitalization. One of the other things about babesiosis is it can be transmitted through blood donation. I'm going to spend a little bit of time on that in the next slide. This is a figure from a paper that showed the impact of the introduction of a new FDA-approved diagnostic test used by the Red Cross starting in 2020 to screen blood donations in the United States.
You can see from the graph that after that test was implemented, blood-borne infections of babesiosis were basically eradicated. If you go and donate blood, you're asymptomatic. This data tells us two really interesting things. There is a reservoir of folks walking around with Babesia infection, and they don't know it. Those residual parasites are biologically relevant because they can transmit disease. We have no idea how many people are in that situation in the United States. If you have an infection and you happen to be symptomatic, you're usually treated with some IDSA-recommended combinations, which are listed here in the graph. Then your progress as you resolve your symptoms is through measurement using a PCR test that's commercially available, for example, through Mayo Clinic, to monitor your infection status, yes or no, as you're recovering from symptoms.
And you could see on the right that over about a 12-week period, most of these folks test negative eventually on that PCR. But look at the sensitivity: 515,140 parasites per mL compared to that blood bank test, three parasites per mL. So we already know from the story with the blood banking that there are a whole bunch of folks walking around with a low parasite burden. But here, what this data is really showing is because of that differential in the diagnostic capability, it's unlikely that even treated patients have cleared their infections at the end of week 12. And so then the question is, what clinical significance does that have?
We know with patients with classic risk factors such as not having a spleen and immunosuppression, it's well documented in the scientific literature that that residual parasite burden can reinitiate infection many times, causing a series of relapses in some patients with immunodeficiency. In immunocompetent people, there are literally no papers in the literature. No one knows what happens. Most physicians suspect that patients with a normal immune system can eventually clear the infection, and it has no medical consequence. Yet every year, our sales of ARAKODA for chronic babesiosis increase. And we have good relationships in the physician community that treat vector-borne disease. They see chronic babesiosis all the time and see an important role for tafenoquine, which is the active ingredient in ARAKODA, in managing their patients.
So there's something missing in our understanding of what happens to patients infected with this organism over a long period of time. At 60 P, we suspect it's because diseases such as long Lyme, post-treatment Lyme disease syndrome, long COVID, and chronic fatigue syndrome all involve a dysregulation of the immune system. And the hypothesis that we're trying to test is whether a persistent babesiosis infection actually prevents your recovery from the chronic symptoms of those other diseases. So now I'm going to spend a little bit of time sharing what we know about tafenoquine and its potential utility against babesiosis. And that will lead into just a very brief description of our clinical trials and what we're doing to potentially advance our products for use in this new patient population.
So you could see from these blood smear micrographs that tafenoquine-treated babesiosis parasites look like hydrogen peroxide-treated parasites in contrast to what you see with vehicle-untreated organisms, a highly vacuolated phenotype. That's because the drug induces oxidative stress inside red cells, killing the parasite. Same for malaria. We know from an extensive series of animal studies that tafenoquine clears Babesia and malaria parasites in acute illness in animals at about the same dose rates. That really promising background scientific data, which we didn't do, this was all done independently of us, led to a publication last year of a case series of five patients from Yale University where they administered tafenoquine as a weekly dosing regimen combined with standard of care to essentially cure four out of five immunosuppressed patients who had relapsing babesiosis and had been treated with various rounds of chemotherapy multiple times over many months.
And you can see here in the bottom right-hand corner of this slide, those empty boxes are indicative of negative PCRs. So this patient had been months and months of treatment, positive PCRs every time they're evaluated, combined tafenoquine led to remission in this patient with clearance. So before we did any clinical trials, we were very confident that tafenoquine was going to have some activity against babesiosis. And then the question is, what data do we need to expand the label and convince physicians that a disease that isn't described in the literature deserves attention and treatment with a potentially new drug? So our research strategy is very simple. We're going to do a series of very targeted, cost-effective trials, three of them.
As soon as we get one that's statistically significant, we're going to go and talk to the agency about what the label might look like, hopefully a very broad one. The earliest possible way you can get data to allow that to happen is the end of next year, and then the other thing our clinical trial program will do is prove that chronic babesiosis can be diagnostically confirmed with an FDA-approved assay, and that's that blood bank assay that the agency's already approved in that specific clinical context, so these are the three trials that we're in the progress of doing. We're enrolling patients in two. We'll start a third one at the Q4. Very briefly, one of them is a randomized placebo-controlled trial in hospitalized patients with severe babesiosis.
The second is in immunosuppressed high-risk patients, which is an open-label expanded access study that is designed to repeat the findings that Yale did and requires a minimum of five patients, of which we've enrolled three. And then the third study is actually in chronic babesiosis, which I'll describe in the next slide. That will start recruiting in October. We think it's possible we could get to the minimum enrollment required in at least one of these studies by the end of the year, potentially opening up the opportunity to release some data in 2026. So this is the chronic babesiosis trial that I mentioned. It's an open-label study of tafenoquine in chronic babesiosis patients.
Because there is no description of this disease in the literature, we defined it for the purposes of this trial as being someone with severe disabling fatigue, any other symptom of babesiosis, and some laboratory evidence of exposure to the parasite in the last 12 months, with that laboratory evidence being quite permissive. The goal is to enroll and treat 100 patients with this profile, with the goal of detecting 16 confirmed infections using that blood bank test. So at the top of the funnel, very relaxed diagnostic criteria. At the bottom of the funnel, when we get to the hardcore data analysis, cases defined using the blood bank test. We'll be administering tafenoquine at the same dose that's approved for malaria prevention with a dosing schedule adjustment.
But basically, it's going to be the same product with the same safety profile as is already being used by patients for malaria prevention in the U.S. market. We'll be looking at a patient-reported outcome, a chronic fatigue marker called the Multidimensional Fatigue Inventory, and seeing if that changes between day zero and day 90. That's an important efficacy metric. But equally important is the secondary endpoint related to diagnostic performance. So we'll be defining these cases using the FDA-approved molecular test and then also testing the same patients at the same time point longitudinally using two commercially available PCR assays to see how those perform against the benchmark standard. These data together will give us a real sense for how many chronic babesiosis patients there are, can we confirm the diagnosis, and does ARAKODA provide benefit.
These developments over the next 18 months will lead to a series of important catalysts for the company, which we're hopeful will drive investor interest. Of course, this year, we've reported increased sales in the first half of the year, and we're hopeful that now that we've resolved the supply chain issue, that will continue. We put out a series of market research and epidemiological analyses about the core babesiosis market in Q2. We think that the commercial program will come to fruition through the end of the year, producing some data and communications regarding the sales situation with the malaria program, which we can communicate to investors. We'll be providing a recruitment update on the three trials I mentioned in Q4 of this year, leading, if everything goes well, to some data outputs early in the new year.
And then that may allow us to make some regulatory decisions about how we want to prosecute the new labeling we would like to get for babesiosis. Thank you very much for your attention. I know there's a headliner coming up that's a lot more interesting than babesiosis, so thank you for your persistence and to those online following.