Earnings Labs

Amicus Therapeutics, Inc. (FOLD)

Q4 2014 Earnings Call· Tue, Mar 3, 2015

$14.49

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Transcript

Sara Pellegrino

Management

Thank you. Good evening, and thank you for joining our conference call to discuss Amicus Therapeutics’ full year 2014 financial results. Speaking on today’s call, we have John Crowley, Chairman and Chief Executive Officer; Chip Baird, our Chief Financial Officer; Bradley Campbell, our President and Chief Operating Officer and Dr. Jay Barth, our Chief Medical Officer is on today’s call and available to participate in the Q&A session. As a reminder, this conference call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 relating to business, operations and financial conditions of Amicus, including but not limited to, preclinical and clinical development of Amicus' candidate drug products, cash runway and the timing and reporting of results from clinical trials evaluating Amicus’ candidate drug products. Words such as, but not limited to, look forward to, believe, expect, anticipate, estimate, intend, plan, would, should, and could and similar expressions or words identify forward-looking statements. Although, Amicus believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, there can be no assurance that our expectations will be realized. Actual results could differ materially from those projected in Amicus’ forward-looking statements due to numerous known and unknown risks and uncertainties, including the Risk Factors described in our annual report on 10-K for the year ended December 31, 2014. All forward-looking statements are qualified in their entirety by this cautionary statement and Amicus undertakes no obligation to revise or update this conference call to reflect events or circumstances after the date hereof. At this time, it is my pleasure to turn the call over to John Crowley, Chairman and Chief Executive Officer of Amicus.

John Crowley

Chairman

Great. Thank you, Sara. Good evening everybody. It’s a pleasure to speak with you. What difference a year makes in biotechnologies, so as we reflect briefly back on the full year 2014 results, it certainly was a major inflection point for our company both for the Migalastat monotherapy program which we will highlight here in a moment as well but also too for our Pompe program in our biologics platform and the vision again that we put in the press release that was just issued a short time ago, I think it is very clear and that’s to build one of the world’s leading and most significant global biotechnology companies, focused on transformational treatments for people living with devastating rare diseases. So again the notion that we are looking at areas where there are devastating diseases, dramatic areas of unmet medical need even where existing approved therapies are in place today and where we can bring novel technologies, our great science, or medical capabilities to bear. We had a great board meeting. I can report to you last week, the Amicus board met here in person. We reviewed our vision, our mission, our strategic plan and our strategy to independently launch Migalastat monotherapy globally. We believe we have the base capabilities in medical affairs, patient advocacy, clinical affairs, scientific affairs that we can add significant value to these programs and deliver on the mission to get the drug to as many appropriate Fabry patients around the world as fast as possible and with that mission to be able to greatly enhance our shareholder value. So let me just recap the WORLD meeting that was a couple of weeks ago in Orlando. So very very, successful meeting, it’s amazing to see how much that venue has grown now to over 1300…

Chip Baird

Chief Financial Officer

Great. Thanks John. Good evening, everyone. I will start today’s financial discussion with a few comments about our current cash position and guidance. As indicated in this afternoon’s press release, Amicus continues to maintain a very strong balance sheet. At December 31 of 2014, we had $169 million in cash and cash equivalents and that compares to $82 million at the same time last year. Our balance sheet was strengthened during 2014 with a $40 million at-the-market financing in the second quarter as well as a $103.5 million offering in the fourth quarter. As guided in early January around the JPMorgan conference, we expect full year 204 net cash spend to total between $73 million and $83 million. Based on this trajectory, we expect our current cash position to fund the operating plan into 2017. Turning to our full year 2014 financial results. I will be referencing tables 1 and 2 in the press release we issued earlier today. Additional details can be found in our annual report on 10-K which will be filed later this evening. Total operating expenses for the full year 2014 increased to $69.9 million compared to $64.5 million for the full year 2013. The year-over-year increase was primarily due to increases in pre-clinical and clinical development costs on Fabry monotherapy and Pompe programs, including carrying 100% of the development costs on Migalastat in 2014 versus 40% of the costs in 2014 under the GSK collaboration. Moving down the P&L, we had a non-operating loss of $1.3 million in the full year of 2014 compared to non-operating income of $1 million in full year 2013. This change in non-operating expense, which is a non-cash item, was primarily due to an increase in interest expense on our outstanding debt, partially offset by the change in our warrant liability which expired in March of 2014. Net loss attributable to common stockholders in full year 2014 was $68.9 million compared to a net loss of $59.6 million in the full-year 2013. Net loss per share of $0.93 in the full-year 2014 was narrower than the net loss per share of $1.16 in the full-year 2013. The narrower net loss per share versus the year ago period is attributed to an increase in the shares outstanding as a result of our ATM and follow-on public offerings. As of December 31, 2014 we had 95.6 million shares outstanding. So this summarizes our key financials for our full-year 2014 as well as our full-year 2015 guidance. More information on our financials will be available in the 10-K which will be online later this evening. Happy to address any questions during the Q&A session but for now, I will turn the call back to John.

John Crowley

Chairman

Great. Thanks, Chip. So let me just conclude by highlighting some of the milestones we expect across our entire Fabry disease franchise and again to remind everybody we think we have a unique platform and series of technologies to be able to help all people living with Fabry disease. Of course, for those with appropriate mutation that begins with Migalastat monotherapy, we’ve already talked about, in the first quarter, the FDA meeting and as soon as we can after that to issue this feedback from the agency on this type C meeting. We would then in mid 2015, the next milestone would be the Migalastat monotherapy MAA submission. We also in the second half of this year at various scientific congresses, since we still have more than 90 patients enrolled in our extension studies who continue to take Migalastat as their only lifelong treatment for their Fabry disease, we continue to collect that data. We expect to see more of that towards the end of the summer and from the extension studies be able to report even longer-term data, including at least 30 months of data on kidney function for the Migalastat patients coming out of the 012 extension study. So further important data that we will see, we will continue to follow their cardiac function and other measures of disease. So in the second half of the year hopefully we will have even more continued good news on the data with Fabry disease. We’re also working very diligently on the notion of combining chaperones with enzyme replacement therapy. We’ve talked to a number of you about the plans in the second half of this year for the initiation of a longer-term phase 2 study of Migalastat co-administered with either Fabrazyme or Replagal, the currently marketed ERTs. Again to a…

Operator

Operator

[Operator Instructions] Our first question comes from Anupam Rama of JPMorgan.

Anupam Rama

Analyst · JPMorgan

Hey guys, thanks so much for taking the question. Just a quick question on where you are in terms of setting up an expanded access program for Migalastat and which regions you guys are going to be focused on initially I guess.

John Crowley

Chairman

Yes, we have been looking at that and working on it very actively. Brad, do you comment?

Bradley Campbell

Analyst · JPMorgan

Sure. Thanks, Anupam. So as you know we have been working on that, that program is set up. Essentially the protocols are finalized. We are working with a great partner with lots of experience in executing those programs globally. We are essentially waiting to get feedback from the FDA before we initiate those programs. If there ask us to do additional work around the submission package, for example, we want to make sure that we have pools of patients available for that really just a precaution. That being said we’re ready to go once we have those regulatory interactions and we would be looking to do that on a global basis on a country by country basis in particular where regulatory mechanisms exist for such expanded access programs. We will have more to say on that as we come forward here and again finalize that regulatory feedback. But I would expect that that would be again on a global basis and a fairly significant effort.

Operator

Operator

Thank you. Our next question comes from David Lavalis [ph] with Janney Montgomery.

Unidentified Analyst

Analyst

When you are looking at Migalastat potentially entering the market, obviously the drug would be looked at and is going to be used in the amenable mutation population. But how do you actually view as the likelihood that doctors will implement the therapy and the obvious would be in people who failed the ERT but theoretically the choice to use it could be earlier than that and what -- how do you think doctors will view that equation?

John Crowley

Chairman

No, very clearly -- I want to be very clear, this is not a second line therapy. This, we think, you look at the initial market of an opportunity for people already diagnosed and on enzyme replacement therapy, that’s about 4000 patients, it’s part of a diligence project that we’re working on with some consultants to narrow that, but about 4000. We think about a third of those patients have amenable mutations already today. So somewhere between 1000 and 1500 we believe immediately upon approval that physicians should strongly consider based on the strength of the data we have, especially in the Switch study that we've already shown you can safely and effectively switch patients that if you have a genotype in one of those 1000 to 1500 patients, again you should immediately switch, stop all ERT and switch to our drug, we think it will have a good safety profile. It will certainly be more convenient, much less of a burden on patients but most importantly we think it may offer benefits for patients that ERT does not offer today. And again that gets to the notion that this is a fundamentally different mechanism of action, it’s getting into places like the podocytes in the kidney. We believe it gets into places like the cardiomyocytes in the heart. We think the strength of the LVMi data on cardiac mass is very distinct from what’s seen in enzyme replacement therapy. So for those reasons that’s going to be a key part of our initial launch focus that we’d expect and also there are about 4000 or 5000 diagnosed with untreated Fabry patients. We think this could offer substantial benefit for many of those patients. Well more than a third of those patients we believe have amenable mutations and then beyond that, we think there may be a much larger patient population but we see this as a really unique new therapy for patients and yes there are some patients who have failed ERT or who cannot tolerate ERT. If they have amenable mutations, certainly they should consider with their physicians Migalastat but we think very much this would be a transformative medicine in the space.

Unidentified Analyst

Analyst

And just quickly moving over to Pompe, given the experience with Migalastat and the challenge that you had in the past, how has that guided you in designing the Pompe program?

John Crowley

Chairman

So again a fundamentally different approach to treating the disease, the Migalastat of course being a small molecule precision medicine in Pompe disease, what we’ve developed is a biologic product. We think it’s a very advanced biologic product that it offers significant potential benefits over the current standard of care in terms of the potential to reduce immunogenicity, to increase tolerability and very importantly to increase tissue penetration of the enzyme into all key muscles of disease, and that’s a good part of the data that we showed at the WORLD meeting. The preclinical data was very very compelling in places like the quadriceps and soleus, very difficult in a head-to-head study with the current standard of care, our uniquely engineered cell line plus chaperone, that drug product combination was very very distinct from the result seen with the current ERT Lumizyme alone.. So as we think about designing a clinical study, this is a drug for all people living with Pompe disease and we want to evaluate it in all key patient populations. And again we’re thinking about a very creative adaptive and innovative design that can move the medicine to patients very quickly. So some general learnings on clinical operations and execution and patient advocacy for sure in our nearly decade work with Migalastat, but the approach in Pompe is very different.

Operator

Operator

Thank you. And our final question comes from Joe Schwartz of Leerink Partners.

Mayank Mamtani

Analyst · Leerink Partners

Hi guys, this is Mayank Mamtani covering for Joe. Thanks again for taking my question and congrats on a very successful quarter. Just quickly on this meeting that you have in two weeks, I was wondering you laid out the four goals but if you can help us understand what specifically would these goals be focused on, which ones if you can help us identify. I know you said you'd already presented the biomarker data in your previous meeting in May 2013 and you will be generating more kidney function data from the long-term outcome study which possibly can go into the NDA application eventually. If you can help us understand which components of this dossier that you have already submitted leading to that meeting would be the key focus for the regulators.

John Crowley

Chairman

Sure. So it’s all the data sets on all the prespecified endpoints from both phase 3 studies, the biochemical data, the kidney function data, the cardiac data and the patient reported outcome data. So many many ways to look at the drug’s effect in many many different respects. And again to highlight the purpose of the meeting is to share that data with FDA, the very complete in a briefing document and to discuss with them specifically our proposal that we move forward with the filing of an NDA and that the focus of that filing be on a full and final approval pathway for the drug. So very very clear objectives to the meeting and hopefully we will be successful. End of Q&A

Operator

Operator

Thank you. And at this time I am not showing any further questions. I’d like to turn the call back to management for any closing comments.

John Crowley

Chairman

No, operator, thanks. That’s all. Thank you all for listening and I can see on the board here, we had very, very good attendance on the call. So I appreciate the effort and interest and certainly thank you to the analysts for the excellent questions. Great. That’s all we have. Have a good night.

Operator

Operator

Thank you sir. Ladies and gentlemen thank you for participating in today's conference. This does conclude today’s program and you may all disconnect. Everyone have a wonderful day.