吉利德科學 (GILD) 2002 Q3 法說會逐字稿

Good day, ladies and gentleman.

And welcome to the Triangle Pharmaceuticals third quarter conference call.

At this time, all participants are in a listen only mode, later we will conduct a question and answer session and instructions will follow at that time.

As a reminder, this conference call is being recorded for digital replay purposes.

I would now like to introduce your host for today's conference, Ms. Rachael Mendell(ph).

Ms. Mendell please go ahead.

Thank you, good morning.

This is Rachael Mendell(ph), Senior Corporate Counsel of Triangle.

It is my pleasure to welcome you to our third quarter 2002 earnings conference call in our discussion today we may make forward-looking statements.

These statements are often preceded by language such as we expect or targeted.

Actual [INAUDIBLE] and events may differ materially from these forward-looking statements.

We urge you to consider these statements in connection with the risks identified in our reports filed with the Securities and Exchange Commission.

I would now like to introduce Daniel Welch, Triangle's Chairman and Chief Executive Officer.

Thank you, Rachael.

Ladies and gentlemen, good morning.

With me today besides Rachael are Chris Rallis, President and COO of Triangle, Robert Amundsen, Chief Financial Officer, Dr. Franck Rousseau, Chief Medical Officer and Anne McKay, our EVP of Regulatory Affairs.

On November 6, we announced our third quarter financial results.

For the quarter ending September 30, 2002, we incurred a net loss of $1.1 million or 1 cent per share as compared to a net loss of $18.2 million or 35 cents per share for the same quarter in 2001.

For the nine months ended September 30, we incurred a net loss of $17.8 million or 23 cents per share as compared to a net loss of $62.2 million or $1.32 per share for the comparable period in 2001.

Now both the quarterly and nine-month results include a one-time $14.2 million noncash recognition of collaborative revenue associated with the termination of our alliance with Abbott Laboratories.

Operating expenses of $16.1 million for the quarter and $46.1 million for the nine-month period of 2002 compare favorably to the operating expense totals of $20.2 million and $69.8 million for the comparable periods in 2001.

We ended the quarter with $68.3 million of cash and investments and are confirming our previous guidance on targeted cash usage of approximately $64 million for the full year 2002.

This will leave us with a targeted balance of approximately $45 million of cash and investments at December 31, 2002, assuming no equity financing or funds from other sources before the end of this year.

Turning to the operations of our business we are actively preparing for the commercialization of our first product, Coviracil for the treatment of HIV disease.

On November 4 we were pleased to announce that the FDA had accepted our Coviracil NDA filing and that it had been granted standard review statis as expected.

As noted in the November 4 press release, we expect our first NDA to be approved in the third quarter of 2003.

We expect to file a marketing authorization application or MAA for Coviracil HIV with the European regulatory authorities by the end of this year.

In preparation for the commercial launch of Coviracil, we have initiated the production of initial launch inventory and have begun the process of hiring our senior sales and marketing staff.

We are also exploring alternative strategies for the commercialization of Coviracil, including potential commercial partnering arrangements with larger pharmaceutical companies experienced in the HIV marketplace.

The finalization of our commercialization strategy for Coviracil is among our very highest priorities at the present.

We expect to have completed our analysis of our various alternatives by year end and to announce our Coviracil commercialization strategy in the first quarter of 2003.

Given that we are still developing our Coviracil commercial strategy which may or may not include a partner, we are not yet prepared to give specific guidance concerning our cash usage or expected operating expenses for 2003.

However, we do expect our operating expenses to increase next year as we invest in prelaunch and launch expenses for Coviracil and initiate somewhat larger later phase studies for Amdoxovir and Clevudine.

Our progress on the development of our portfolio of compounds proceeds according to plan.

As you may recall on July 30, we announced the very impressive 24 week results of study FTC-301.

In which Coviracil was proven statistically superior to [Zeret].

At the end of October, we completed on schedule the data base lock on the 48-week data of this pivotal study.

We are, therefore, on track to submit the 48-week data to the FDA before the end of this year.

Regarding Amdoxovir, two trials in patients who have failed therapy involving one drug in each of the three main classes of HIV drugs are moving toward initiation.

The ACTG, AIDS clinical trial group is planning to initiate these two trials which are named ACTG-5118 and ACTG-5165 in this patient population early next year.

We are also working very hard to initiate around the end of this year a placebo-controlled trial in 150 treatment experienced patients.

Our progress on Clevudine, our second compound for Hepatitis B virus behind Coviracil is proceeding according to plan.

That concludes our update on the third quarter earnings and our operations.

My team and I are now ready to answer any questions that you may have.

Operator, could you open the lines?

Thank you.

If there are any questions at this time, please press the one key on your touch tone telephone if your question has been answered or you wish to remove yourself from the queue, please press the pound key.

Again if you have a question, please press the one key on your touch tone telephone.

One moment for questions.

Our first question is from David [Boucher].

Please state your affiliation.

Hi guys, David Boucher from [Waterberg Tobin].

My first question is -- let's go into your plans for Amdoxovir.

Now you're going to be initiating two trials in HIV patients.

Can you tell me -- give us a little more detail on what those are going to be and how your current trials are going?

I'll make a comments here and then hand it over to Dr. Rousseau, our Chief Medical Officer.

But the point I want to reiterate as I have all along is that we are moving ahead in the area we intend Amdoxovir to be used, that is triple class failures.

We have two specific trials about to initiate -- well, as we mentioned, in the first quarter of next year.

And Dr. Rousseau now can explain just what these trials are all about and the status.

Hi, David.

There are three phases to trial.

All together, two conducted in collaboration with the ACTG.

As I mention, the first of the trials, 5118, will actually be a randomized comparison of two dose [INAUDIBLE] in combination with[E-20] .

In advanced patients.

The second trial is actually the [INAUDIBLE] plus [INAUDIBLE] exploring a boosting strategy similar to a strategy similiar to [Retoniver and Lipiniver] strategy in deep salvage patients.

And the third study which is going to be conducted and sponsored by Triangle will be 150-patient trial with the[DAPD] of two dose and the placebo group.

A double blind study in treatment experienced patients.

Ok.

In terms of the phase two that's on hold for the problems with [INAUDIBLE]?

What going on there?

As I mentioned, the phase three is not on hold.

Phase two actually continues and patients are still being dosed, if patient needed the [DAPT] to build a viable regimen, which mean patients considered salvage per FDA definition, a patient with at least one drug in each of the three categories of existing drug, [nuclecides], no [nuclecides] and [INAUDIBLE].

We had a significant number of patients who were inthe APD-150 who were actually in that situation so this patient are still being dosed with the APD and followed in the study.

To clarify, I might add the status of Amdoxovir is that it remains on partial clinical hold for treatment naive patients.

That's very important.

However, we are allowed by the FDA to move ahead in the area that we always intended Amdoxovir to be used, and that is in triple class failure patients.

And that is the two trials that Franck mentioned.

Ok.

Good.

Can you give us an update on the immuno-stimulatory sequences program?

How is that progressing?

We're still in the preclinical stage.

We're currently -- have undergone a big effort to extensively review all the data generated since the inception of the project by Dynavax to refine how we could best proceed to clinical stage.

Ok.

Thank you very much.

You're welcome.

Thank you, David.

Again if you have a question, please press the one key on your touch tone telephone.

Our next question from Michael Walsh.

Please state your affiliation.

[INAUDIBLE] Capital.

Could you guys please describe how you think that your products for Hep B are going to fit into the market now that the second product has been launched into that indication?

We'll have Dr. Rousseau will feed that question.

I think they're going to be fine in the market.

As you know, we do not have the result of pivotal trial [FTCB] 301 so I'll hold my comments for the phase two results.

And for Clevudine we have not initiated the phase three program.

We have high hope for Clevudine to be a major player in the treatment of chronic Hepatitis B and we also have a high hope that the combination of [INAUDIBLE] and Clevudine would become a very significant improvement upon and beyond our available --there are not two there are three out there.

If you include[INAUDIBLE].

Nevertheless, we feel there's still a very significant medical need.

And that Clevudine and Coviracil combined could certainly bring a lot of value to the patient and the treater.

However, this will be data proven.

The clinical trial assisting just that question are ongoing and rolling according to patient have very good rate.

We anticipate to have some preliminary answer sometime next year.

In order to reinforce our opinion that this is the way forward.

So we have to wait for the data to have a detailed discussion.

Is that what you're saying?

Yes.

That's fine.

We have a follow-up question from [David Boucher] please go ahead.

Yeah, Dr. Rousseau, as long as we're on the discussion of Hepatitis b, obviously with the trials for hep[sera], there was a lot of clinical data regarding the delay of fibrosis biopsy data.

Can you give us your opinion when you're developing Clevudine if you start a phase three trial, will you also have to do biopsies and what kind of requirements for biopsies will you have for Coviracil?

There was an advisory committee in August, just the day after the review of [Hepsera] where there was a question for the panel to discuss the value -- alternative markers for effectivacy and safety and drug of Hepatitis B. To my knowledge the division the FDA has not come back publicly to announce what would be their final decision.

In the interim, we are anticipating that we will need to do [INAUDIBLE] as the primary point for the pivotal trial in Hepatitis B. If the preferred end point from the FDA perspective changes, then, of course, we would adjust the clinical trial design to that.

But currently when we're forecasting the type of trial we have to do, we anticipate to use the biopsy and [INAUDIBLE] change from baseline as our primary end point, just like we're doing for Coviracil.

But if the FDA's if's preference for primary end point does change that should not affect the current phase three trial for Coviracil and Hepatitis b, is that correct?

No.

Because A) traditionally the FDA has not made their change retractive.

I would be very surprised that the FDA would not want to see [INAUDIBLE] I hope that in [turn] [sub population] they may accept additional co-primary end point.

I would be very surprised if they say [INAUDIBLE] has no value.

Other element is the other market, they could want to see what we're collecting in the study anyway.

I agree with you completely.

I just wanted to make sure that point was made clear for investors.

Thank you.

Thank you, David.

Again, if you have a question, please press the one key on your touch tone telephone.

One moment for questions.

I'm show nothing further questions at this time.

Please continue with any closing remarks.

Okay, if there are no further questions, I wanted to thank the listeners for their interest in Triangle Pharmaceuticals, and we look forward to joining you at the next major news event or quarterly report.

Thank you very much.

Thank you Mr. Welch.

Ladies and gentlemen this does conclude the day's conference call.

Thank you for your participation.

You may disconnect at this time and have a good day.