Genmab A/S (GMAB) 2003 Q3 法說會逐字稿

Good afternoon, and welcome, ladies and gentlemen, to the Genmab conference call. At this time, I would like to inform you that this conference is being recorded, and that all participants are in a listen-only mode. At the request of the company, we will open the conference up for questions and answers after the presentation.

During this telephone conference, you may be presented with forward-looking statements. Actual results may differ materially. Genmab is not under any obligation to update statements regarding the future, nor to confirm such statements in relation to actual results unless this is required by law.

Joining us today are Dr. Lisa Drakeman, Jan van de Winkel, Joseph Josbe, and Claus Moller. At this time, I will turn the conference over to Dr. Lisa Drakeman. Please go ahead, doctor.

Good afternoon, and I'd like to welcome you all to the Genmab nine-months results conference call. I think you have probably all seen the press release, so you know that Genmab is on target to meet the guidance we have provided for year end, that our spending and our operating loss are significantly below the money that we were spending in 2002. So we have had a very good cost-control approach this year. But with that, we've continued to make very significant progress on all of our focus clinical projects.

One of them is the HuMax-IL15 (ph) Phase II study. I know that we have -- on previous calls, we have promised that as soon as we had an update we would give it. Those of you who have had the time to read the interim results will see there is an update on all the products in there, including some news on the Amgen study. Amgen is now running this program, and they are enrolling additional patients in the Phase II.

Initially, Genmab planned to treat 100 patients. The study actually permitted us to treat more than that, but we planned to do an interim analysis and present that data to Amgen. Instead of conducting the interim analysis, Amgen has decided to add additional patients as existing drug supply allow. I don't have an exact number; I don't believe anyone can actually determine what the final number of patients will be at the moment, and Amgen has not made any comment on that.

However, I think this is very good news because this strengthens the study. It should provide additional information about how HuMax-IL16 is performing in rheumatoid arthritis. It also represents a significant commitment immediately by Amgen. While I can't comment on the budget for this ongoing Phase II study, any of you who have looked at the costs of clinical trials know that this is a multimillion dollar commitment. It's been made immediately, and this process is already underway.

And in addition to the Amgen news, we had another press release today. The ASH abstracts were released. Genmab will have two presentations at ASH. One of them will be the preliminary analysis of HuMax-CD4 to treat cutaneous T-cell lymphoma. Now in this case, the abstract itself tells you that we had 10 patients at the time we filed it. The press release lets you know that we actually have the full complement of 24, although we have 11 in one study and 13 in the other. We will not have data from every dose for every patient in December because some patients are -- still have a number of doses to go. But we will have what we think is a pretty complete analysis of the study to date, since it's an open-label study, when we go to ASH at the beginning of December.

We are very favorably impressed with the preliminary data. You can see if you look at the abstract that in the first ten patients, who had had no more than four doses, we already had observed two partial responses.

On the basis of the preliminary analysis, we have decided to increase the size of this study. We're already enrolling extra patients. We're also increasing the dose. Again, any of you who have studied cancer products know that the typical way to treat these patients is to give them as much as of a product as you believe is safe. We have seen good safety data to date in the study, so we are going to double the dose for the early-stage patients, and we'll actually quadruple the dose for the late stage patients, who have a much higher tumor burden. And we think this is good for the patients, and should yield a lot of very interesting information. So much more to come from that at the ASH meeting, and as I said, the study is ongoing.

We will also have new pre-clinical data on HuMax-CD20 at the ASH meeting. It will focus primarily on the mechanism of action. You have seen some of the data already this year showing That HuMax-CD20 result is outperforming Rituximab in a number of preclinical measures, but we will have additional information by the time of that ASH conference, and we're very much looking forward to that as well.

With that, I would like to open up for questions. As the operator explained to you, Dr. Jan van de Winkel, Dr. Claus Moller, and Joseph Josbe, our Chief Accounting Officer, are all on the call with me today. So operator, please open the call up for questions.

(OPERATOR INSTRUCTIONS). Patrick Fuchs, DZ Bank.

Lisa, just again to confirm the Amgen agreement with Genmab on IL-15. They had a look on the Phase II data that you were able to disclose to them, and after that, they decided to include additional patients for that study --?

They have not unblinded that study, Patrick.

Not unblinded --

The study is not unblinded. There was no interim analysis for (multiple speakers) Genmab had enrolled 110 patients at the time the transition to Amgen. But the study has not been unblinded. It increases the power of the study if we keep it that way.

Of course, I think it's probably fair to say that they know safety data is good, right? Because (multiple speakers) like in any clinical trial, there is ongoing analysis of safety. Is that correct, Claus?

Yes. That's the only data from the study they have had access to (multiple speakers) blinded data. So it could be -- the safety data concerns all the dose groups we have in there, plus the placebo patients that are in there.

Okay. The next point is -- you are still on track with HuMax CD4 for psoriasis to release data in Q4?

Absolutely. I think that the last patient has had the last visit, and now they're starting to bring all the data in and complete the database. So sometime in this quarter, we'll be able to tell you what happened in that study.

Okay. And then, HuMax CD4 for CTCL, for this T-cell lymphoma -- you do not disclose any detail right now, meaning which patients -- or at which stages you are using, which clinical endpoints, and so on, or -- is that right? You do not disclose these things now?

Well, I think if you look at the abstract, you'll see there's quite a bit of information in there about the first ten patients and their doses. I think -- Claus, the clinical endpoint is a standard one, isn't it?

Yes, (multiple speakers) it's a regular one. (multiple speakers) It's a composite assessment score that defined by (ph) -- and has been used previously for two other treatments that has been approved, right (ph), by the U.S. FDA. So we're using that to evaluate the figures in the patients.

Which is response rate and least (multiple speakers)?

Well, it's -- these patients have numerous lesions in the skin. And you evaluate both to sickness -- how sick they are, or how much they elevate from the surface -- and redness of them, if they have scaliness, and the size of them. And so you have various different components -- and also the pigmentation. So we have five different components (multiple speakers)

This lesion index that its accepting for that (multiple speakers)

And then you take -- in each patient, you pick five lesions that you follow.

Okay, and a follow-on on that is --

And then the answer is -- it's not a survival trial. It's a complete or partial (multiple speakers) responses based on what happens with the lesions.

Sure. And next thing is -- can you disclose how many patients you will -- we will enroll in the follow-on study?

Yes, that is really depending on drugs supplies, isn't it, Claus? I don't think we can predict exactly how many we will be able to treat?

No, I think right now, it's also going to depend on what kind of response rate, magnitude of response rate we're going to see, and also how the responses at higher doses are. Right now, we can't say how many, but -- obviously, this is not the kind of study that takes 400 patients in each group. (multiple speakers) This is really small studies.

In 50 patient or 100 patients? Just to get an impression what statistical data you want to --

I think what we can tell you is that if you look at the two products that are approved to treat CTCL, both of which have significant toxicity -- in both cases, the total package was less than 100 patients. (multiple speakers) Okay, so we are enrolling additional patients now as our existing drugs supply allows. But Claus is right; this is not a big study.

So you might be able to meet in total, let's say, 70 to 100 patients? Treat --

I think it's all depends on what the FDA thinks of our data when we show it to them. (multiple speakers) We haven't done that yet.

But you're able to treat -- with the drug that you have currently, you're able to treat 70 to 100 people?

I can't comment on how many we can treat (multiple speakers) it depends on which part -- because you see, in the late stage, they're getting more drug. So it depends on -- how many patients we can treat depends on which part of the study they come into -- you know, because they're both open and enrolling.

Okay. And last question is a financial one. I mean you really did not need much money for your operative work in the quarter. First, where does it come from? And you were sticking, according to Reuters, to your guidance. And where does an increase in operating cost could come in Q4?

I think the comment there is that our expenses are not evenly divided over the year. In the fourth quarter, you know that we've planned to file the IND for HuMax-CD20, which means that we will be receiving drug, and we have to pay for that, for example.

So there are -- it's just according to which expenses we're anticipating how many patients we're treating, how much we have to pay the centers. But we've done a very careful analysis. We could ask Joe to comment on that. We've done a very careful forecast, and believe that our guidance is accurate. Joe, would you like to comment on that?

Yes, the guidance that we had provided a few months back at the end of the second quarter had built in (inaudible) expenses in the fourth quarter as we (inaudible) described based upon manufacturing, as well as clinical programs.

Peter Welford, Merrill Lynch.

I just have a few questions, if I can. We're wondering when the full data of HuMax-CD4 for cutaneous T-cell will be released? And when it -- how sort of many additional patients you were thinking of recruiting, and perhaps when the full data then, with those additional patients, could be released?

I think that when we get to the ASH meeting, the first 24 patients, we will have a significant body of data. Do you think that's a fair statement, Claus?

I think that's a fair statement.

They may not all have finished every single treatment. But we will know quite a bit about those 24 patients, based on their treatment schedule when they entered the study. We don't know all of that now. We will know more than.

In terms of when we would give you results, it's very hard to say right now, because we are continuing to enroll patients to see what happens with the higher dose. I think that we are -- it's an open-label study. We are evaluating as we go along. So it's very hard to give any exact prediction as when we will be able to come out with the next set of results. Claus, would you like to add anything to that?

No, as you said, we have an opportunity to present data at ASH, and of course we will present as much as we have available at that timepoint. But -- and we should have most of the data available from this first part of the study, the 280 milligram.

It's possible (multiple speakers) -- go ahead.

Sorry -- would you imagine recruiting the same sort of number of people for the additional higher doses as you did for this 280 dose trial -- i.e., another 24 patients, perhaps?

You know, I think that the next step for us is to look at what happens with the higher dose patients. Our safety profile, as we said, looks good so far -- not just as of time of the abstract. We said in the press release as of now.

So we really need to evaluate what happens with the higher dose patients. I think we can just reiterate -- we can imagine that this is a very small study for approval. That's -- I think we said that from the beginning. And on the basis of the favorable information we have so far, we continue to believe these are very small studies. But the regulatory authorities will decide what is the right number. And we don't have any comment on that at the moment other than our best guess is less than 100 patients.

Erica Whittaker, Merrill Lynch.

Hi there, just another question about the CTCL studies. I mean, you're talking about smaller studies for approval. Would you be looking primarily in patients who are refractory to other treatments, so they have a less of a chance of survival than other early-stage CTCL patients? And then that going -- looking at that group of patients, it might give you a better chance of a fast-track-type approval? Is that what the strategy is?

I actually think that the early-stage patients have very little available for them at all. The refractory patients have these two highly toxic treatments. In both cases, there is an unmet medical need. But Claus, would you like to comment on that?

Yes, the whole purpose of splitting up the study in two is of course that we would like to target both patient populations. And as Lisa said, that because of the toxicity of available therapy, there's a certain reluctance of using it in the early-stage therapies. So -- and it may be that, as I think we have also indicated, we are doubling the dose of the early-stage now, and we're going up to almost a gram of antibody in the later stage, just reflecting that we do believe that this is two different populations of patients --

Oh, I see, okay.

And so I think the answer is they're probably both -- I think, Erica, we honestly believe they're both very small studies. Do you agree with that, Claus?

Absolutely, and I think the product is at least as feasible for the one population as for the other one.

Okay, but you would need another study after this increase dose study. Is that the idea?

Just again, depending on what your sources will require. When we have some data we can discuss with them on the higher doses, it would make sense probably to get some opinions about that. But since this is open-label study, there may be a possibility to just roll on from here on, in just expanding the existing studies.

That would certainly be what happens with the two products that are approved, that they basically have these small pivotal studies. They wouldn't -- we don't know what they'll say. But based on what we have seen before, the FDA certainly accepted small pivotal two, three data.

Okay, and that was for which indication -- that was for -- you said the other -- treatments for CTCL?

Yes, there's a diphtheria toxin conjugated to an IL-2 antibody that can have life-threatening side effects. And I think they were fewer than 70 patients in that study for approval. Is that correct, Claus?

Yes.

And then the other one is called -- I don't know (multiple speakers) (indiscernible) -- yes, and that's a small molecule isn't it?

Yes, it takes a longtime for to induce effect, plus there's several problems with the blood lipids and several patients develop pancreatitis when they're treated with this product. Plus longer-term, there's clearly some risk associated with the use of that product.

Okay. (multiple speakers) And that was how many patients for that one?

There was all -- I don't remember the exact number. But it was also (multiple speakers) 100 patients.

Less than 100, yes, okay.

(OPERATOR INSTRUCTIONS). Samir Devani, Coat (ph) Securities.

I've got a couple of questions. Just coming back again to the CTCL study -- looking at the data, I know there's only a few patients here, but can you tell us whether a greater response was seen in the 1-B patients or the 2-B patients?

I don't know that we can comment beyond what's in the abstract, due to the ASH guidelines, and also the fact that it's ongoing. Claus, can you say anything about that?

No, I think we cannot comment on that right now.

Okay. I'm sorry, Samir.

Okay. And the second question then comes back onto the reduction in the T-cell count during the study. I'm just wondering -- as you're not doubling the dose, I assume (ph) that we can expect to see the T-cell count to reduce further. Is there any level at which you could expect a clinical consequence of that?

Claus, I think you should answer that one.

No, absolutely not. I don't mind seeing these patients going down to absolutely zero CD4-positive circulating cells, which would indicate that they basically don't have any tumor cells left.

I think if -- probably the parallel is to look at Rituximab, which really does reduce the number of B-cells very significantly. And within 6 to 12 months, most of those patients recover those B-cells. But this is different than an autoimmune disease. I mean, in this case, you really want to get rid of the T-cells.

Yes.

And seemingly (ph), you'd have to continuously treat these patients, because you're doing full infusions here -- but I assume that as you go on, these will continue?

No, well -- you may have to continue treating them for a period of time, but not indefinitely. The concept would be that these cells are susceptible to induction of hepatosis N (ph), and I think Jan can talk about that also. But then -- so we're actually killing the cells.

Okay, so when you stop treatment, is there -- have you got any data from patients that have had -- have completed their full infusions? Do we see a rise back in those cells?

(multiple speakers) We do not know enough yet to comment on that.

I should actually just tell Samir, also (ph) -- it's 16 infusions total. So when you see the 10 with the four infusions, they're only partway through their course of therapy. That's part of the reason that data is so encouraging. They're just starting. And we've already seen two partials.

Peter Welford, Merrill Lynch.

Sorry, just a very quick follow-up. Do we assume from the fact that you're raising the doses that the (technical difficulty) drop in the level of CD4 cells you felt could be greater than achieved with the existing dose -- i.e., there wasn't sufficient drop for you to sort of feel these patients were being treated?

Claus, do you want to comment on that?

Yes, I mean the initial assumption for this study was that we should go to higher doses than we had ever tested before. But for regulatory purposes, it was only possible for us to get acceptance of 280 milligram, initially. And then, at least we got that, and then we got started with that. And I mean, obviously, not all patients -- as we have indicated here, not all patients achieve the complete remission from the beginning here.

So we -- as soon as we had sufficient data to support an increase in dose because of the safety profile in these patients -- meaning that from the first group of patients here that we could see from a safety prospective that there was no issues around these doses, we went back in and argued for higher doses to see if we could have even more patients responding. Does that satisfy you?

(OPERATOR INSTRUCTIONS) If there are no further questions, I'll turn the conference back over to Dr. Drakeman to conclude.

Thank you very much. Thank you all for being here. We've had a lot of questions about the cutaneous T-cell lymphoma product, and I thought I might just take a minute to talk briefly about the market, because we haven't had any discussion of that.

CTCL is a type of T-cell lymphoma where patients can live for a long time. Sometimes they could live 15 years or even longer. But eventually, their disease can take their life.

Now because they live longer, even though the incidence is relatively small, the prevalence is relatively high. In our press release, we've told you our best estimate, that there's somewhere between 16 and 20,000 patients in the United States. We have thought that there's a good possibility that we would treat a significant number of these over the course of their disease, and then because their disease lasts for a period of time, we may be able to treat them more than once.

On top of that, if our safety profile continues to be good -- which it is now -- this is going to be a relatively non-toxic therapy compared to anything else that might be available. And as we've said, to the best of our knowledge, there really isn't anything good for them in the early stage.

So we've made a conservative estimate that we would be able to treat about 5,000 patients a year in the United States. We've also looked at orphan drug pricing and we thought, well, it seems to start around $40,000. We've looked at the size of the doses that we need to give, and we thought, well, we certainly could see orphan drug pricing would be reasonable given how much material that we will be using. So if we were to conservatively say we could price this product at $50,000, a treatment for 5,000 patients a year makes this a $250 million marketplace.

The other thing is that we haven't made any final decision, but we are considering to market this product ourselves. We believe that the number of people we would call on is relatively small. These are a small group of specialists that treat this type of patient. And this may be something we can manage with a modest sales force -- maybe less than 20 people -- that we could run from our existing U.S. office at a very reasonable cost.

Consequently, it's possible that the revenue that comes to Genmab from this product could be as substantial as if we had out-licensed the product for bigger indication but were receiving a royalty that wouldn't be the same as basically the profits after the costs of goods and marketing.

I just wanted to make that comment because we haven't had that discussion with many of you. And we would be happy to discuss it in the future if you had any additional questions about that.

In the meantime, I very much appreciate your taking the time to join the call. We look forward to speaking with you again soon, and we very much look forward to the ASH conference in December. Thank you, and good night.

Ladies and gentlemen, this concludes our conference for today. Thank you all for participating and have a nice day. All parties may now disconnect.