Ligand Pharma $LGND has built a business around a large portfolio of partnerships in which other biotech and pharma companies develop drugs at no cost to LGND. The upside to shareholders from any one deal is lower, but the many "shots on goal" and growing royalties from PROMACTA and KYPROLIS offer a lower risk investment opportunity compared to many biotechs.
Continue reading below for a round-up of notes on LGND-partnered programs from a number of partners from 2q-2012 earnings conference calls.
Continue reading below for a round-up of notes on LGND-partnered programs from a number of partners from 2q-2012 earnings conference calls.
Merck $MRK (transcript quote via Morningstar)
"We also anticipate several meaningful R&D events in the second half of this year...and starting Phase II trials for our novel BACE inhibitor, which recently had early data presented at the Alzheimer's Association International Conference."
Note: I was able to obtain these abstracts recently and will post about them separately. For background, see this post regarding earlier an earlier data presentation.
"We also anticipate several meaningful R&D events in the second half of this year...and starting Phase II trials for our novel BACE inhibitor, which recently had early data presented at the Alzheimer's Association International Conference."
Note: I was able to obtain these abstracts recently and will post about them separately. For background, see this post regarding earlier an earlier data presentation.
GlaxoSmithKline $GSK (transcript via SeekingAlpha)
"Just yesterday, we got news that the Promacta hepatitis C thrombocytopenia indication will receive FDA priority review. Again, a very good signal."
"PROMACTA sales in 2q-2012 were $47m, including $21m in US, up >50% due to long-term use being added to the FDA label."
Amgen $AMGN:
Sales of NPLATE (only competitor of PROMACTA) were $50m in US and $36m ROW in 2q-2012
"Just yesterday, we got news that the Promacta hepatitis C thrombocytopenia indication will receive FDA priority review. Again, a very good signal."
"PROMACTA sales in 2q-2012 were $47m, including $21m in US, up >50% due to long-term use being added to the FDA label."
Amgen $AMGN:
Sales of NPLATE (only competitor of PROMACTA) were $50m in US and $36m ROW in 2q-2012
Onyx Pharma $ONXX (transcript quotes via SeekingAlpha)
"Kyprolis was available for ordering from wholesalers on July 27, several days ahead of plan, and orders have begun being shipped to clinics and hospitals this week."
"As I mentioned on the July 20th call, our approach has been to put in place an approximately 100 person multidisciplinary field team. The field-based market access experts, nurses and sales leadership team were trained in advance of the early approval, and our market access experts, nurses and sales leaders were immediately deployed upon approval beginning calls in July 23. Our field sales team is completing their training and will be calling on offices later this month.
We are not providing guidance for Kyprolis net sales as we monitor sales trends for this newly launched product. It's important to note that until we receive a Kyprolis-specific Medicare J Code, which we expect in January 2014, a miscellaneous J Code will be used. While this is common practice with injectable products, it can require extra time for physicians to receive reimbursement, especially in the initial launch phase."
"The carfilzomib program currently includes 3 ongoing Phase III trials. The ASPIRE study is the primary confirmatory study and enrolled patients who would had 1 to 3 prior therapies. Based on a planned interim analysis, we could have data in the first half of 2013, depending on the rate of event accruals. If the trial goes to full completion, we would expect a data readout in the first half of 2014 but, again, depending on event accrual rates. The FOCUS trial is designed to support registration for carfilzomib in relapsed and refractory multiple myeloma outside of the United States. We are on track to complete enrollment of 300 patients in the first quarter of 2013.
Our development plan also includes evaluating carfilzomib's superiority over existing therapy. We recently initiated ENDEAVOR, our first head-to-head study. This global Phase III trial is in multiple myeloma patients who have relapsed after 1 to 3 prior regimens and compares carfilzomib in combination with low-dose dexamethasone to VELCADE with dexamethasone. And we are also finalizing our plans on the protocol design for a head-to-head trial in a front line setting, which we hope to initiate in 2013."
"So we do expect the majority of our patients will also -- will already have either progressed on or had issues with their response to VELCADE."
"With regard to prescription tracking, we are distributing Kyprolis through a small network of specialty pharmaceutical distributors, who, in turn, sell the drug on to the hospitals, physician offices, infusion centers and so forth. Our experience and our expectation is that those early data reported by third-party data sources tend both to be incomplete and inconsistent. So I'd caution you about relying too heavily, particularly in this launch period, on data available from those third-party sources."
"We have put in place two separate oncology field forces, so the kinase inhibitor field force that you referenced will be -- if regorafenib is approved, we'll add regorafenib and sell both regorafenib and Nexavar. We just hired about 100 field base personnel for the promotion of Kyprolis. But that will be all that that field force sells, so two separate salesforces now."
First, could you please provide some details on your royalty agreement for carfilzomib with Ligand?
"We have, in connection with our purchase of Captisol from Ligand, Captisol is a component of the Kyprolis product, a royalty obligation to Ligand which is tied to global net sales of Kyprolis. Those royalty obligations range from 1.5%, which is the starting rate, up to a highest rate of 3% of global Kyprolis net sales. That top 3% royalty rate is triggered at sales levels over $750 million, and the royalty rate steps up between 1.5% and 3% with increasing levels of sales [note the intermediate thresholds are $250m and$500m, with royalties increasing by 0.5% each time]
"Kyprolis was available for ordering from wholesalers on July 27, several days ahead of plan, and orders have begun being shipped to clinics and hospitals this week."
"As I mentioned on the July 20th call, our approach has been to put in place an approximately 100 person multidisciplinary field team. The field-based market access experts, nurses and sales leadership team were trained in advance of the early approval, and our market access experts, nurses and sales leaders were immediately deployed upon approval beginning calls in July 23. Our field sales team is completing their training and will be calling on offices later this month.
We are not providing guidance for Kyprolis net sales as we monitor sales trends for this newly launched product. It's important to note that until we receive a Kyprolis-specific Medicare J Code, which we expect in January 2014, a miscellaneous J Code will be used. While this is common practice with injectable products, it can require extra time for physicians to receive reimbursement, especially in the initial launch phase."
"The carfilzomib program currently includes 3 ongoing Phase III trials. The ASPIRE study is the primary confirmatory study and enrolled patients who would had 1 to 3 prior therapies. Based on a planned interim analysis, we could have data in the first half of 2013, depending on the rate of event accruals. If the trial goes to full completion, we would expect a data readout in the first half of 2014 but, again, depending on event accrual rates. The FOCUS trial is designed to support registration for carfilzomib in relapsed and refractory multiple myeloma outside of the United States. We are on track to complete enrollment of 300 patients in the first quarter of 2013.
Our development plan also includes evaluating carfilzomib's superiority over existing therapy. We recently initiated ENDEAVOR, our first head-to-head study. This global Phase III trial is in multiple myeloma patients who have relapsed after 1 to 3 prior regimens and compares carfilzomib in combination with low-dose dexamethasone to VELCADE with dexamethasone. And we are also finalizing our plans on the protocol design for a head-to-head trial in a front line setting, which we hope to initiate in 2013."
"So we do expect the majority of our patients will also -- will already have either progressed on or had issues with their response to VELCADE."
"With regard to prescription tracking, we are distributing Kyprolis through a small network of specialty pharmaceutical distributors, who, in turn, sell the drug on to the hospitals, physician offices, infusion centers and so forth. Our experience and our expectation is that those early data reported by third-party data sources tend both to be incomplete and inconsistent. So I'd caution you about relying too heavily, particularly in this launch period, on data available from those third-party sources."
"We have put in place two separate oncology field forces, so the kinase inhibitor field force that you referenced will be -- if regorafenib is approved, we'll add regorafenib and sell both regorafenib and Nexavar. We just hired about 100 field base personnel for the promotion of Kyprolis. But that will be all that that field force sells, so two separate salesforces now."
First, could you please provide some details on your royalty agreement for carfilzomib with Ligand?
"We have, in connection with our purchase of Captisol from Ligand, Captisol is a component of the Kyprolis product, a royalty obligation to Ligand which is tied to global net sales of Kyprolis. Those royalty obligations range from 1.5%, which is the starting rate, up to a highest rate of 3% of global Kyprolis net sales. That top 3% royalty rate is triggered at sales levels over $750 million, and the royalty rate steps up between 1.5% and 3% with increasing levels of sales [note the intermediate thresholds are $250m and$500m, with royalties increasing by 0.5% each time]
Eli Lilly $LLY (transcript quotes via Morningstar)
While it has not been officially confirmed, we strongly believe that Lilly's CETP inhibitor evacetrapib is a capitsol-enabled drug, meaning there is financial payments to LGND tied to its development and/or future sales. LLY has been beset recently by late-stage clinical failures, but it is unclear currently how that may affect their decision to launch a large, high-risk phase 3 program with this asset. LLY may defer until more data from Merck's competing drug is unveiled later this year.
"In the remainder of 2012...We also could begin Phase III trial for Evacetrapib, CETP inhibitor as well as for baricitinib, our oral JAK1, JAK2 inhibitor for rheumatoid arthritis in partnership with Incyte."
And then on evacetrapib, is there a possibility of partnership for this molecule given the large-scale work in expense and is that a gating factor before starting Phase III? How does it impact your R&D guidance for the longer term?
"We remain very excited about this program based on the data we released at AHA last year which shows a compelling benefit on both HDL and LDL. As mentioned earlier, we are hoping to start this program very soon. Without commenting specifically on Evacetrapib in can say broadly we always look at our options to maximize the molecule, share risk and bring them forward through the Phase III process with partners or without, and I think that certainly an option, and this program as well as others, but we have made no specific determinations at this time."
While it has not been officially confirmed, we strongly believe that Lilly's CETP inhibitor evacetrapib is a capitsol-enabled drug, meaning there is financial payments to LGND tied to its development and/or future sales. LLY has been beset recently by late-stage clinical failures, but it is unclear currently how that may affect their decision to launch a large, high-risk phase 3 program with this asset. LLY may defer until more data from Merck's competing drug is unveiled later this year.
"In the remainder of 2012...We also could begin Phase III trial for Evacetrapib, CETP inhibitor as well as for baricitinib, our oral JAK1, JAK2 inhibitor for rheumatoid arthritis in partnership with Incyte."
And then on evacetrapib, is there a possibility of partnership for this molecule given the large-scale work in expense and is that a gating factor before starting Phase III? How does it impact your R&D guidance for the longer term?
"We remain very excited about this program based on the data we released at AHA last year which shows a compelling benefit on both HDL and LDL. As mentioned earlier, we are hoping to start this program very soon. Without commenting specifically on Evacetrapib in can say broadly we always look at our options to maximize the molecule, share risk and bring them forward through the Phase III process with partners or without, and I think that certainly an option, and this program as well as others, but we have made no specific determinations at this time."
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