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| 8-K - FORM 8-K - LIGAND PHARMACEUTICALS INC | d8k.htm |
 John Higgins,
President and CEO BIO CEO and Investor Conference
February 15, 2011
Exhibit 99.1 |
 2
•
The following presentation contains forward-looking statements regarding
Ligand’s prospects, plans and strategies, drug development programs and
collaborations. Forward- looking statements include financial projections,
expectations regarding research and development
programs,
and
other
statements
including
words
such
as
“will,”
“should,”
“could,”
“plan,”
etc. Actual events or results may differ from Ligand’s
expectations. For
example, expense reductions and drug development programs may not be realized. In
addition there can be no assurance that Ligand
will achieve its guidance in 2011 or beyond.
•
The forward-looking statements made in the presentation are subject to several risk
factors, including, but not limited to, Ligand’s
reliance on collaborative partners for
milestone and royalty payments, regulatory hurdles facing Ligand’s
product candidates,
uncertainty regarding Ligand’s
product development costs, the possibility that Ligand’s
drug
candidates might not be proved to be safe and efficacious, the commercial performance of
Ligand’s
approved products, decreased demand for Captisol
material and a possible failure
to successfully combine the businesses of CyDex
with Ligand’s
business. Additional risks
may apply to forward-looking statements made in this presentation.
•
The risk factors facing Ligand
are explained in greater detail in Ligand’s
filings with the
SEC, including the most recently filed annual reports on Form 10-K and quarterly reports
on Form 10-Q, as well as other public filings.
•
While forward-looking statements reflect our good faith beliefs (or those of the
indicated third parties), they are not guarantees of future performance. We disclaim
any obligation to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
Safe Harbor Statement |
 3
Location
La Jolla, CA
Recent Stock Price
$9.02
Shares Outstanding
19.6 million
Market Cap
~$170 million
Main Assets
•
Numerous royalties
•
Over 50 fully funded partnerships
•
Fully owned development programs
•
Substantial tax assets
Ligand
Corporate Summary |
 4
Ligand’s
Main Value Drivers
1.
Blockbuster Program
2.
Unique Asset Acquisition Focus
3.
Large Asset Portfolio
4.
Development and Licensing Platform |
 5
Blockbuster Drug Potential -
Promacta
®
•
Marketed drug for thrombocytopenia: serious and chronic blood disorder
•
Opportunity for significant label expansion
18 ongoing studies conducted by GSK and investigators
Large market focus: Hepatitis C and cancer-related Thrombocytopenia
•
Major Upcoming Catalyst: 2 pivotal Phase III trials to be completed this year
•
Long patent life –
thru 2024
•
Significant tiered royalties (~9% on $1 billion in annual sales)
|
 6
Business Model: Unique Asset Acquisition Focus
•
The market environment and Ligand’s
team have produced a
unique opportunity for acquiring quality biotech assets
•
Five acquisitions in two years
•
Result: Over past few years, substantially expanded portfolio (partnered and
unpartnered
assets) that have the potential to drive revenue and growth in value
*
*
Genaera
acquisition
was
for
product
royalty
rights
and
not
for
an
entire
company |
 7
Through 5 acquisitions in past two years,
Ligand
has amassed a rich trove of partnerships and assets
Large Asset Portfolio
Approved
13%
Preclinical
9%
Phase I
34%
Phase II
36%
Phase III
8%
Current Asset Portfolio
•
7 marketed drugs
•
More than 60 total programs
•
More than 50 fully funded partner programs |
 8
Development and Licensing Engine
•
In our history, we have done over 20 deals and discovered/co-discovered 5
approved drugs
•
Ligand
has the platform, assets and credentials to keep doing more deals
•
Past 6 months track record
•
Internal development of proprietary programs including SARM program for muscle
wasting/frailty, which is currently finishing a Phase I trial
CombiChem
deal
•
Combinatorial chemical library and screening
technology divested to Venenum
Biodesign
CXCR4 deal
•
Discovery deal in stem-cell space with British
company
Tanaproget
deal
•
Pfizer sublicensed to undisclosed partner in
women’s health space
Chiva
deal
•
Basket of clinical-stage liver-targeted drugs for China
|
 9
Promacta |
 10
•
What does Promacta
do?
Promacta
is a once daily oral medicine that activates
the thrombopoietin
(TPO) receptor
Activation of the TPO receptor causes an increase in
the production of platelets
•
What is Promacta
approved for?
Promacta
is approved for ITP in U.S., Europe and
Japan
•
What are the next indications for Promacta?
Promacta
is in Phase III for Hep
C-related
thrombocytopenia
Promacta
is in Phase II for thrombocytopenia related to
various cancer types
Promacta
®
: A Projected Growth Driver for Ligand
Promacta
is a first-in-class therapy for raising platelet levels
in patients experiencing thrombocytopenia |
 11
•
GSK is currently running two large Phase III studies in Hep
C patients
Study 1 (PEGASYS/Ribavirin)
Study 2 (PEGINTRON/Ribavirin)
•
Both
studies
are
randomized,
double
blind,
placebo
controlled
in
750
patients
currently on peginterferon/ribavirin
•
Primary outcome is Sustained Virologic
Response (SVR) 6 months after
treatment
•
Promacta
Hep
C trials (trial completions targeted for 3Q11)
•
Phase II data showed 65% of patients on 75mg daily of Promacta
finished
viral therapy course, compared to 6% on placebo
•
10% of all Hep
C patients cannot finish viral therapy due to
thrombocytopenia, resulting in a sub-optimal therapeutic response
Promacta
and HepC-Related Thrombocytopenia
The ongoing Phase III studies for Hep
C-related thrombocytopenia
are the basis for a potentially large expansion of the Promacta
value |
 12
•
The platelet segment is expected to be the next frontier in the
multi-billion dollar hematology market
•
Promacta
and its backup compound will, we believe, build a long-
term platelet franchise for GSK/Ligand
•
GSK is expending large amounts of resources and money to
expand Promacta
markets and indications
Two 750 patient studies for Hep
C-related thrombocytopenia
Currently in multiple Phase I and Phase II studies for cancer-related
thrombocytopenia
Filings and approvals in new countries
Promacta: Reasons for Excitement
Ligand
shareholders have many reasons to be optimistic about Promacta
|
 13
SARM
Selective Androgen Receptor Modulator |
 14
•
Aging baby boomers: 65+ is expected to grow from 35 million in
2000 to over 70 million in 2030
–
Recent rate of disability —40% (ACS, 2004)
•
The elderly: the fastest growing segment
–
Grow from 3.0 to 6.2 million in the next decade
•
Social Security Disability Program and the Supplemental Security
Program pay $62.5 billion yearly to 7.5 million disabled persons; this
amount is expected to grow several-fold
The Staggering Cost of Disability and Aging |
 15
•
80 years of empiric, clinical, epidemiological, and clinical trials data
provide unequivocal evidence that androgens increase skeletal
muscle mass and strength
•
Testosterone is not the answer
–
Concern about potential adverse effects on prostate
–
Many older men have microscopic foci of prostate cancer. Testosterone
might make these subclinical foci grow
–
Inherent bias towards detection of greater number of prostate events in
Testosterone-treated men
•
We need a SARM
SARMs
are non-steroidal androgens that act preferentially on skeletal
muscle while sparing tissues associated with side effects, like the
prostate
The Need for a SARM |
 16
SARM Overview
LGD-4033 retains the beneficial properties of natural androgens, while
mitigating the toxic actions and side effects of steroidal androgens
16
•
Phase I data –
safety and potential efficacy
•
LGD-4033 has desirable tissue-selective properties
-
A potent, full agonist on bone with anabolic and
anti-resorptive
effects
-
A potent, full agonist on skeletal muscle with anabolic effects
-
Acute and chronic muscle wasting disorders are an
emerging multi-billion dollar market
-
Major growth potential as baby-boomers swell the US elderly
population in the coming decades
•
A low potency, weak agonist on prostate and sebaceous
glands with high selectivity resulting in minimal drive on
these tissues |
 17
CyDex –
Technology Platform
and Select Key Assets |
 18
CyDex
Corporate Overview
CyDex
Quick Facts
–
Private company founded in 1993 and located near Kansas City
–
A
successful,
cash-flow
positive
business
based
on
the
Captisol
®
technology
–
5 FDA-approved compounds utilizing Captisol
technology
–
Now operates under Ligand
as a wholly-owned subsidiary with 9 employees
Business Model
–
Utilize Captisol
to improve the efficacy, stability, solubility and patent life of new and
existing drugs
–
Pursue
partnerships
with
traditional
licensing
terms
and
product
sales
revenue
Core Assets
–
Proprietary Captisol
technology platform and extensive Drug Master File
–
>25 partnerships with the potential for future milestones and royalties
–
Significant existing revenue generated from Captisol
–
Internal pipeline of Captisol-enabled drugs for future licensing
2010 Key Financials
–
$16.3 million in revenue
–
$7.6 million in EBITDA |
 19
19
1.
Immediately accelerates the projected financial growth of Ligand
•
CyDex
is a cash-flow positive business with revenues from royalties, material sales and
licensing fees
•
Ligand’s
2011 revenue with CyDex
is projected to more than double versus Ligand’s
stand-
alone revenue, not including any new licensing revenue (i.e. SARM) or accelerated growth
in Promacta
®
royalties
2.
A transformational portfolio acquisition that significantly expands
Ligand’s
portfolio of fully funded programs
•
The combined company has more than 60 programs (development stage and marketed
drugs) up from 35 programs pre-acquisition
•
The existing CyDex
portfolio includes numerous high-quality license and royalty bearing
agreements,
including
Onyx
for
carfilzomib
and
Prism
for
Nexterone
®
3.
Provides proprietary and well-validated platform in the increasingly
important drug reformulation segment of the pharma
industry
•
With increasing industry-wide clinical and regulatory challenges and the market erosion
due to generics, we believe the need to protect and expand existing markets has
never been greater
Top Three Reasons for the Acquisition |
 20
•
Captisol
is a chemically modified cyclodextrin
used to improve solubility,
stability and bioavailability of active pharmaceutical ingredients (API)
•
Mainly used to formulate IV drugs, but can also be used for oral, ocular and
topical formulations
•
Multiple Captisol-enabled products in clinical development and on the
market
•
Extensive drug master file (DMF), patents and know-how built by CyDex
over past 20 years provide important barriers to entry
•
Exclusively manufactured for CyDex
by Hovione
What is Captisol
®
? |
 21
FDA-Approved Captisol
®
Marketed Drugs
Drug
Indication
Partner
Approved Markets
Abilify
®
IM
Bipolar Disorder
Bristol-Myers Squibb
U.S, Europe
Nexterone
®
Ventricular Fibrillation
Prism
U.S.
VFEND
®
IV
Antifungal
Pfizer
U.S., Europe, Japan
Cerenia
®
Canine
Motion Sickness
Pfizer
U.S., Europe
Geodon
®
IV
Schizophrenia
Pfizer
U.S., Europe
•
Successful regulatory track record of five Captisol
enabled drugs being
approved and four currently paying royalties |
 22
•
Onyx Collaboration
–
Captisol-enabled IV formulation of carfilzomib
for refractory multiple myeloma
–
CyDex
receives milestones, royalties, and revenue from Captisol
material sales
•
Prism Collaboration
–
CyDex
developed and licensed to Prism a Captisol-enabled IV formulation of
amiodarone
(Nexterone) for atrial
fibrillation
•
Prism has recently received FDA approval for Nexterone
–
New Captisol
formulation allows for more convenient premixed preparation that
eliminates time and errors associated with pharmacy mixing
•
Undisclosed Large Pharma
Captisol-Supply Collaborations
–
CyDex
currently has multiple collaborations with undisclosed large pharmaceutical
companies to supply Captisol
for their development programs. Multiple programs
currently in late stage development
Key CyDex
Collaborations |
 23
Financial Outlook and Upcoming Events |
 24
2010 Year-end Financial Information
•
2010 revenues total $23.5 million
–
$7.3 million in royalties
–
$16.2 million in collaborative R&D and other revenues
•
Total operating expenses total $54.5 million
–
$16.9 million in lease exit and termination costs
–
$22.1 million in R&D
–
$12.8 million in G&A
–
$2.8 million in write-off of acquired in-process R&D
•
Cash highlights: ~$30 million
–
$24 million –
2010 year-end cash
–
$1.5 million –
Cash proceeds from recent deals
–
$4.5 million –
Tax refund received subsequent to year-end
•
Q4 2010 share repurchases total ~$100,000 at average price of $8.53
|
 25
2011 Revenue Outlook
•
Total 2011 revenue currently projected to be
$22 -
$24 million
–
$9 -
$10 million from original Ligand
business
–
$13 -
$14 million from CyDex
(partial year
accounting)
•
Ligand
(pre-CyDex) revenue currently expected to
consist of:
–
Three royalty streams (Promacta, Avinza,
Conbriza)
–
Revenue for license/deal fees
–
With the termination of the Roche contract in
December 2010, Ligand
will not be eligible to
receive $4 -
$5 million in milestones that were
projected earlier
•
Potential for additional sources of revenue and cash
in 2011 above these projections based on new
license agreements (i.e. SARM)
2011 Revenue Breakdown*
License And Other
Royalties
Material Sales
*Excludes revenue from new deals, if any
~15%
~35%
~50% |
 26
2011 Expense Outlook
•
Operating expenses currently expected to be $16 million to
$18 million
•
Average cost of goods as a percentage of material sales projected
to be approximately 35%
•
CyDex
non-cash amortization expense estimates to be determined
in the near-term |
 27
Business built for financial growth
•
Number of products expected to pay royalties to Ligand
is growing:
•
Once quarterly royalty revenue exceeds our low cost structure, Ligand
expects
to be sustainably profitable and cash flow positive
•
Significant expense reduction over the past few years
-
In 2008, 1 product (Avinza) paid royalties
-
Now in 2011, 7 products are expected to pay us royalties
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
2009
2010*
*
2011
1
1
* Guidance as of 1/11
Illustrative Annual Expenses |
 28
Upcoming Portfolio Events
2011 Potential Near-Term Catalysts
•
Conbriza
royalties commence
Q1
•
Promacta
Japan ITP launch
Q1
•
Clopidogrel
license deal
Q1
•
SARM Phase I data
Q2
•
Nexterone
launch
Q2
•
Promacta
HepC
Phase III data
2H
•
IL-9 Phase II data
2H
•
Promacta
Phase II oncology data
2H
•
Dinaciclib
Phase II data
2H
•
Carfilzomib
NDA filing
2H
•
New CyDex
Captisol
license(s)
2H
•
p38 trial initiation
2011
Approved
13%
Preclinical
9%
Phase I
34%
Phase II
36%
Phase III
8% |
 29
Event
Location
Date
•
Citi
2011 Global Health Care Conference
New York
March 2
•
BIT's
3rd Annual World Congress of BIO-SOFT
Beijing, China
March 23
•
Analyst Day
New York
Q2
Upcoming Investor Events |