Loading... Symbols: Authors: BioMarin Pharmaceutical Management Discusses Q4 2012 Results - Earnings Call Transcript

BioMarin Pharmaceutical (BMRN) Q4 2012 Earnings Call February 21, 2013 5:00 PM ET
Operator
Good day, ladies and gentlemen, and welcome to the BioMarin pharmaceutical Inc. Fourth Quarter and Full Year 2012 Financial Results Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to introduce your host for today's conference, Eugenia Shen of Investor Relations. Ma'am, you may begin.
Eugenia ShenThank you. On the call today is a J.J. Bienaimé, BioMarin CEO; Dan Spiegelman, CFO; Hank Fuchs, Chief Medical Officer; and Jeff Ajer, Chief Commercial Officer.
This nonconfidential presentation contains forward-looking statements about the business prospects of BioMarin Pharmaceutical, including expectations regarding BioMarin's financial performance, commercial products and potential future products in different areas of therapeutic research and development.
Results may differ materially depending on the progress of BioMarin's product programs, actions of regulatory authorities, availability of capital, future actions in the pharmaceutical market and developments by competitors, and those factors detailed in BioMarin's filings with the Securities and Exchange Commission such as 10-Q, 10-K and 8-K reports.
And now I'd like to turn the call over to J.J. Bienaimé, BioMarin's CEO.
Jean-Jacques Bienaim - Chief Executive Officer and DirectorThank you, Eugenia. Good afternoon, and thank you for joining us on today's call. As we wrap up 2012 and set our sights on key 2013 milestones, I would like to share some thoughts of -- over the past and what is ahead for BioMarin. At BioMarin, our strategy is develop first-in-class or best-in-class therapies where we can make a big difference in the lives of the small number of patients suffering from rare or ultra-rare diseases. That strategy bore fruit in 2012. They set us for further growth in 2013 and beyond.
2012 was a milestone year for BioMarin on a number of important fronts. On the commercial side of our business, we reached the $0.5 billion revenue level. And with a direct commercial presence in 26 countries and products available in more than 40 markets worldwide, we expect to see revenues from our first-in-class commercial therapies to continue to grow. On the development side, we announced positive results for our Phase III Lumizyme study, and we expect to file for approval in the U.S. and EU over the next 2 months. We also announced positive results from our PEG-PAL Phase II study, and we plan on initiating a Phase III next quarter. Overall, we made continued progress on our rich development pipeline. And as a result, we expect to have 6 programs in the clinic this year, the most ever at BioMarin, and one of the richest pipelines for a company our size.
As we start 2013, we're excited about a potentially transformative event set with a number of key milestones coming up in the next few months. The filing of Vimizim VLA remains on track for later this quarter with a potential approval and product launch before year end in the U.S. Vimizim could be our largest product to-date and should put us on the road to reaching the billion-dollar revenue level over the next few years.
Before the end of this quarter, we would also have BMN-701 Phase I/II data and a program go/no go decision. As Hank will describe more fully, we have recently determined that if the data supports going forward with the further development of 701, we will be able to utilize a new cell line, which is much more productive than the current cell line. And with a new cell line, we could initiate a Phase II/III trial, the key component of our pivotal program before the end of this year, almost a full year earlier than we had previously anticipated.
Next quarter, we would also expect to present data on BMN-673 at ASCO, and we could be in a position to start a Phase III study before the end of the year. Finally, before we hit the halfway mark on '13, we expect to start a PEG-PAL Phase III study.

BioMarin Pharmaceutical Inc licenses Factor VIII gene therapy programme for treating Haemophilia A

Biopharmaceuticals company BioMarin Pharmaceutical Inc (nasdaqgs:BMRN) said on Thursday that it has entered into an agreement to license a Factor VIII gene therapy programme for the potential therapeutic treatment of haemophilia A from University College London (UCL) and St Jude Children's Research Hospital.

Following the selection of a development candidate this year, BioMarin Pharmaceutical plans to initiate and complete IND-enabling toxicology studies next year and initiate proof of concept human studies by the end of 2014.

BioMarin Pharmaceutical's license and commitment to support the research programme was made possible by UCL Business, UCL's wholly-owned technology transfer company, working with Professor Amit Nathwani of the UCL Cancer Institute.

"Gene therapy is emerging as a powerful and viable way to treat genetic disorders and is complementary to its current suite of commercial products and research programmes," said Jean-Jacques Bienaime, CEO of BioMarin. "Haemophilia is an attractive target for gene therapy as factor levels in the blood serve as good biomarkers, relatively low factor levels are required for a clinically important benefit in severe patients and the current standard of care of intravenous infusions three times a week is quite onerous."

BioMarin Pharmaceutical (BMRN) Could Fall Through $25.16 Support Level

BioMarin Pharmaceutical (NASDAQ:BMRN) closed Tuesday's losing trading session at $25.99. In the past year, the stock has hit a 52-week low of $17.70 and 52-week high of $28.42. BioMarin Pharmaceutical stock has been showing support around $25.16 and resistance in the $27.46 range. Technical indicators for the stock are Neutral. For a hedged play on this stock, look at the Jul '11 $25.00 covered call for a net debit in the $23.34 area. That is also the break-even stock price for this trade. This covered call has a duration of 143 days, provides 10.20% downside protection and an assigned return rate of 7.11% for an annualized return rate of 18.15% (for comparison purposes only). BioMarin Pharmaceutical does not pay dividends at this time.

BioMarin Pharmaceutical (BMRN) Trading Near $26.31 Support Level

BioMarin Pharmaceutical (NASDAQ:BMRN) closed Tuesday's advancing positive trading session at $26.78. In the past year, the stock has hit a 52-week low of $17.70 and 52-week high of $28.35. BioMarin Pharmaceutical stock has been showing support around $26.31 and resistance in the $27.05 range. Technical indicators for the stock are Bullish. For a hedged play on this stock, look at the Jul '11 $25.00 covered call for a net debit in the $23.78 area. That is also the break-even stock price for this trade. This covered call has a duration of 178 days, provides 11.20% downside protection and an assigned return rate of 5.13% for an annualized return rate of 10.52% (for comparison purposes only). BioMarin Pharmaceutical does not pay dividends at this time.

BioMarin Pharmaceutical Inc. Endures Analyst Downgrade; BMRN, AMGN, TLCR

BioMarin Pharmaceutical Inc. (BMRN) was downgraded from Buy to Hold on Monday, November 1st---a negative sign for the stock that investors will have to endure. FYI, Morgan Joseph uses the following rating scale when analyzing stocks: Buy, Hold, Sell.

BioMarin Pharmaceutical Inc. has an average analyst recommendation score of 2 and competes for investment dollars withAmgen Inc. (AMGN) and Talecris Biotherapeutics Holdings Corp. (TLCR) --two other stocks in the Biotechnology industry that have average analyst recommendation scores of 1.9 and 2.8, respectively.

BioMarin Pharmaceutical Inc. Beats Analyst Expectations; BMRN, AMGN, SHP

Analysts were expecting BioMarin Pharmaceutical Inc. (BMRN) earnings to come in at ($0.01) per share for last quarter, but BMRN beat expectations with actual earnings of $0.06---7 cents above the consensus estimate. BMRN also issued earnings guidance for next quarter that is in line with current analyst expectations.

Today's announcement shows that BMRN has not made much progress since last year. This quarter's gain of 0.06 per share, compared with a gain of 0.06 per share during the same quarter a year ago is a negative sign for the company.

We'll have to see if this positive announcement helps BMRN's stock price in the near term. BMRN has gained 0.1 percent during the past month and is currently above its 200-day moving average.

BMRN is a part of the Biotechnology industry---along with stocks like Amgen Inc. (AMGN) andShangPharma Corporation America (SHP)During the next five years, analysts expect the earnings-per-share (EPS) growth rate in the industry to be 15.29 percent. If you compare BMRN's projected EPS growth rate of 31 percent to that of the industry, you can see that analysts expect BMRN to outperform the industry in the future by 16.06 percent.

Analysts also believe AMGN's earnings are going to grow at a rate of 8.64 percent, but we don't have a five-year EPS growth projection for SHP. AMGN has gained 0.04 percent during the past month and is currently above its 200-day moving average. SHP has lost 0 percent during the past month and is currently below its 200-day moving average.

BioMarin, Cardica, La-Z-Boy, Techfaith

Shares of the following companies may have unusual moves in U.S. trading tomorrow. Stock symbols are in parentheses, and prices are as of 5:20 p.m. in New York.

Standard & Poor’s 500 Index futures expiring in September added 0.20 point to 1,089.30.

BioMarin Pharmaceutical Inc. (BMRN US): The maker of treatments for rare genetic disorders said it bought ZyStor Therapeutics Inc., a privately-held biotechnology company, for as much as $115 million.

Cardica Inc. (CRDC US) surged 42 percent to $2.36. The maker of heart-surgery equipment said Intuitive Surgical Inc. (ISRG US) will pay $12 million for a royalty-bearing license and equity investment in about 1.25 million shares.

Life Technologies Corp. (LIFE US): The provider of gene- analysis tools for medical research agreed to acquire Ion Torrent for $375 million in cash and stock.

BioMarin Pharmaceutical buys Zystor Therapeutics in deal worth up to $115 million

BioMarin Pharmaceutical Inc. said Tuesday it bought privately held biotechnology company Zystor Therapeutics Inc. in a deal potentially worth more than $115 million.

Under the deal, BioMarin paid $22 million upfront. Zystor is eligible to receive up to an additional $93 million if certain milestones are met. Zystor is developing ZC-701, a potential treatment for the enzyme disorder Pompe disease.

Shares of BioMarin rose 17 cents to close at $20.52.

BioMarin discontinues DMD drug trial due to pharmaceutical & pharmacokinetic challenges

BioMarin Pharmaceutical Inc. announced that it has completed the phase 1 clinical study of BMN 195, a small molecule utrophin up-regulator, for the treatment of Duchenne muscular dystrophy (DMD). The phase 1 clinical trial was a single-centre, double-blind, placebo-controlled, single-dose escalation study followed by a multiple-dose escalation study in healthy volunteers.

The administration of up to 400 mg/kg did not achieve plasma concentrations believed to be required to increase utrophin expression. Moreover, plasma concentrations of BMN 195 were even lower on repeat administration. Based on these results, BioMarin has concluded that the likelihood of achieving a therapeutic effect in DMD patients is highly unlikely and has discontinued development of BMN 195.

"Duchenne muscular dystrophy remains a serious unmet medical need affecting approximately 40,000 patients in the developed world, and BioMarin remains committed to this disease area," said Jean-Jacques Bienaime, chief executive officer of BioMarin. "Given the limitations of BMN 195, we believe that other approaches to up-regulation of utrophin may be more possible, and we continue to believe that utrophin upregulation is a viable approach for the treatment of DMD. We are currently working on additional candidates to take forward into early human studies, and the new compound we are working on appears to overcome the limitations of BMN 195."

Duchenne muscular dystrophy is a fatal neuromuscular disorder that affects 1 in 3,500 boys with an estimated patient population of over 40,000 in the developed world.

DMD is caused by a genetic defect that results in DMD patients lacking an important protein called dystrophin, which is crucial to maintaining muscle integrity and function. The absence of dystrophin results in extensive muscle wasting in all voluntary muscles as well as the heart and breathing muscles and causes severe restriction in the mobility of DMD patients by their early teens and is ultimately fatal, generally in their twenties. Currently there is no cure for DMD. Corticosteroid treatment is the only frontline therapy and acts to only delay the progression of the disease.

BioMarin develops and commercializes innovative biopharmaceuticals for serious diseases and medical conditions. The company's product portfolio comprises four approved products and multiple clinical and pre-clinical product candidates.

BioMarin Pharmaceutical Inc. (BMRN) CEO Jean Jacques Bienaime Buys 1,500 Shares

CEO of BioMarin Pharmaceutical Inc. (BMRN) Jean Jacques Bienaime buys 1,500 shares of BMRN on 06/12/2009 at an average price of $14.52 a share.

BioMarin Pharmaceutical Inc. is a developer of carbohydrate enzyme therapies for debilitating life-threatening chronic genetic disorders and other diseases and conditions. The company completed a six-month evaluation of patients being treated with BioMarin's lead product BM101 for the treatment of mucopolysaccharidosis-I or MPS-I. Patients were treated with BM101 as part of a pivotal clinical trial completed to determine the safety and efficacy of the drug in humans. BioMarin Pharmaceutical Inc. has a market cap of $1.5 billion; its shares were traded at around $15 with a P/E ratio of 93.8 and P/S ratio of 5.1.

BioMarin's Kuvan gets priority review in Canada

NOVATO, Calif.—BioMarin Pharmaceutical Inc. said Wednesday its genetic disorder drug Kuvan will get a priority review by Canadian regulators.

The drug treats phenylketonuria, or PKU, a genetic disorder that can cause problems with brain development. It is already approved in the U.S. and had sales of $15.5 million during the first quarter.

The priority review means a shortened submission review of 180 days versus the standard 12 months. The company expects to ask for approval during the third quarter, and a decision would likely come in the first half of 2010.

Shares fell 7 cents to $14.01 in morning trading.

La Jolla Pharmaceutical Company Reports Operating Results (10-Q)

La Jolla Pharmaceutical Company (LJPC) filed Quarterly Report for the period ended 2009-03-31.

LA JOLLA PHARMACEUTICAL CO. is engaged in the research and development of therapeutic products for the treatment of autoimmune and inflammatory diseases. La Jolla Pharmaceutical Company has a market cap of $17.78 million; its shares were traded at around $0.32 .

Highlight of Business Operations:

Based on these results, we immediately discontinued the Riquent Phase 3 ASPEN study and the further development of Riquent. We had previously devoted substantially all of our research, development and clinical efforts and financial resources toward the development of Riquent. In connection with the termination of our clinical trials for Riquent, we subsequently initiated steps to significantly reduce our operating costs, including the termination of 75 employees, which was effected in April 2009. We also ceased the manufacture of Riquent at our facility in San Diego, California, as well as all regulatory activities associated with Riquent. Pursuant to SFAS No. 112, Employers’ Accounting for Postemployment Benefits and SFAS No. 146, Accounting for Costs Associated with Exit or Disposal Activities, we recorded a charge of approximately $1.1 million in the quarter ended March 31, 2009, of which $0.7 million was included in research and development and $0.4 million was included in general and administrative expense. This amount is expected to be paid out by the end of the second quarter of 2009.

In January 2009, we sold all of our auction rate securities to our broker-dealer, UBS A.G. (“UBS”) at par value of $10.0 million. As of December 31, 2008, we had previously recognized a total impairment charge of $2.3 million as a result of the illiquidity of these securities, which was fully offset by a realized gain of $2.3 million from UBS’s repurchase agreement that provides for a put option on these securities. Following the sale of these investments, we no longer hold any auction-rate securities.

For the three months ended March 31, 2009, research and development expense decreased to $9.9 million from $11.3 million for the same period in 2008 as a result of the discontinuation of the Riquent Phase 3 ASPEN study. This decrease was partially offset by an increase in termination expense, mainly relating to severance, of approximately $0.7 million related to the termination of research and development personnel. During April 2009, 65 research and development personnel were terminated.

For the three months ended March 31, 2009, general and administrative expense increased to $2.5 million from $1.9 million for the same period in 2008. This increase is primarily the result of an increase in termination expense, mainly relating to severance, of approximately $0.4 million related to the termination of general and administrative personnel as well as an increase in consulting and professional services. During April 2009, 10 general and administrative personnel were terminated.

At March 31, 2009, we had $17.6 million in cash and cash equivalents as compared to $19.4 million of cash, cash equivalents and short-term investments at December 31, 2008. Our working capital at March 31, 2009 was $6.1 million, as compared to $3.0 million at December 31, 2008. The decrease in cash, cash equivalents and short-term investments resulted from the use of our financial resources to fund our clinical trial and manufacturing activities and for other general corporate purposes. This decrease was partially offset by the non-refundable commencement payment of $7.5 million received from BioMarin CF under the Development Agreement and the proceeds of $7.5 million from the sale of 339,104 shares of our preferred stock to BioMarin Pharma under the securities purchase agreement in January 2009.

Due to the futility determination of the Riquent clinical trial, our stock has experienced significant price and volume volatility since February 2009. Our stock is currently trading below $0.40 per share and we could continue to experience further declines in our stock price. Our stock is currently trading below the $1.00 minimum bid price required under Nasdaq’s continued listing requirements. Although Nasdaq has suspended the enforcement of rules requiring a minimum $1.00 closing bid price and the rules requiring a minimum market value of publicly held shares, this suspension is currently only in effect through July 19, 2009. We will likely be non-compliant with Nasdaq’s continued listing requirements when this suspension is lifted. If our stock continues to trade below $1.00 when the temporary suspension is lifted, Nasdaq may commence delisting procedures against us.

BioMarin Pharmaceutical slips to loss in Q1; backs FY09 net product revenues outlook - Quick Facts

BioMarin Pharmaceutical Inc. (BMRN: News ) announced that its first quarter GAAP net loss was $13.2 million or $0.13 per share, compared to GAAP net income of $1.7 million or $0.02 per share for the first quarter of 2008.

Non-GAAP net income was $9.3 million or $0.09 per share for the first quarter of 2009, compared to non-GAAP net income of $4.1 million or $0.04 per share for the first quarter of 2008.

Total revenues for the quarter was $73.98 million, compared to $60.40 million in the prior year quarter.

Analysts polled by Thomson Reuters expected the company to report a loss of $0.12 per share on revenues of $74.04 million for the quarter. Analysts' estimates typically exclude special items.

For the fiscal 2009, total net product revenues are still expected to be in the range of $300 million to $329 million. GAAP result is still expected to be loss of $15 million - $0 million, and non-GAAP net income to be $33.7 million - $51.7 million.

Analysts expect the company to report a loss of $0.07 per share on revenues of $324.57 million for fiscal 2009.