Genmab A/S (GMAB) 2003 Q4 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 obligations to update statements regarding the future, nor to confirm such statements in relation to actual results, unless this is required by law. I'll now turn the conference over to Dr. Lisa Drakeman. Please go ahead, Dr. Drakeman.

Good afternoon, good morning to those of you who are in the United States and thank you all for joining the Genmab 2003 results conference call.

As those of you know who have seen the release or the preliminary annual report, results are broadly in line with management's expectations and previously issued guidance with a net loss of DKK 327m, which is approximately US$55m, a cash burn of DKK 333m, which is approximately US$56m. On December 31, our cash position was DKK 1.036b or approximately US$173.9m. The operating loss and the net loss show significant reductions from 2002. But, we were still able to work on five clinical development programs within this budget, showing a close attention to cost control.

We also had a number of important business achievements in 2003, including Amgen exercising it's option to HuMax-IL15 ahead of schedule and receipt of our first revenues US$10.5m related to that partnership represented promising data from HuMax-CD4 in CTCL and began the clinical development programs for HuMax-EGFr and HuMax-CD20. This hard work in 2003 sets us up for what we expect to be a highly productive 2004. During which we expect to present results from our on going clinical trials. These include Phase II HuMax-CD4 results of the expanded study in cutaneous T-cell lymphoma. Phase I/II result with HuMax-EGFr and also Phase I/II HuMax-CD20 result. We are also making plans to initiate a Phase II study in non-cutaneous T-cell lymphoma, which represents a substantial expansion of the potential market for the CD4 anti-body.

In addition, based on the encouraging data seen so far, we are making plans for a pivotal study with HuMax-CD4 in CTCL, which we expect to begin this year. At the same time, Amgen is carrying forward at their cost, an expanded HuMax-IL15 Phase II study, adding to the 110 patients originally recruited by Genmab. While we move for clinical development pipeline forward, we are continuing our efforts to build a broad portfolio and expect to maintain a pre-clinical pipeline of more than 10 program including HuMax-HepC, which we are preparing for clinical trial. Since inception, Genmab's strategy has been to build a business by developing products, because drug development does carry risks, we have taken a portfolio approach giving ourselves numerous chances to succeed. We are now seeing the realization of this strategy as we expect our pipeline to mature significantly in 2004, thus increasing the possibility of achieving potential revenues from products through partnering transaction. We will continue this work with the same dedication and cost consciousness exhibited in 2003. Thank you all for you attention, we will now open the call for questions.

Thank you Dr. Drakeman. The question and answer session will begin at this time. If you are using a speakerphone, please pick up the handset before pressing any numbers. Should you have a question, please press star one on your push button telephone. If you wish to withdraw your question, please press star two. Your question will be taken in the order it is received. Please standby for your first question. Our first question comes from Sally Bennett with ING, please state your question.

Hi Lisa. Just a few questions if I may. Perhaps you could give us a little bit more guidance as to which quarter we may expect the reserve to be higher dosing CD4 studies in CTCL, that would be useful? And just as well, perhaps an indication of how big you believe the pivotal study may have to be for that indication? Just as well, I don't know whether you could give a minute, look for, you are planning to spend around $60m or more on R&D during 2004, I am just wondering if you could give us a bit of a split as to how that is being spent on the products that are in the clinic? Thanks.

Okay. Thanks Sally, that's a long list, I will do the best I can with them. First of all, as to guidance on the CTCL data, as you know, that's an open label study. I can't give you a specific date for that presentation as yet, but I think that there is a good possibility, we will be able to talk about this study in the first half of the year. As to how big a pivotal study will be, this all has to be qualified by the fact that there is no agreement with the FDA at present about what size that study should be. What we do know is that there are two products available to three CTCL, at least for late-stage patients, they both cost significant toxicity, and both of those products had fewer than a 100 patients in the pivotal study. Our best estimate is that, we would need somewhere between 15 and 100 patients. We don't expect this to be a very big study. Finally, when coming down to the R&D, we have not provided a breakdown for how we are spending our money, I think, it's probably not something that we have discussed and probably will not give a kind of product-by-product breakdown at present.

Okay, thanks.

The next question comes from Annette Larsen with Carnegie, please state your question.

Hi, it's Annette Larsen from Carnegie. (Audio Problem)

Annette, for some reason, I am having trouble hearing you. I don't know if other people can hear you well.

Okay, is that better now?

A little, but not much.

Can you hear me now?

That's much better, thanks.

Okay, great. I have two questions on the clinical trials program or to be clinical trials program. On CD20, have you already initiated the trials there, started to enroll patients? Are you expecting a feedback from the authorities on that? And on the Hepatitis C, when do you expect to initiate the clinical trials there?

Okay. On the CD20 study, we have permission to go forward or as you know, the FDA allows you to, they don't actually give you an approval of your IND. So, we filed the IND in December and we are now able to go forward and continue the clinical development with that study. With HuMax-HepC, our goal is to prepare the antibodies for the clinic this year. We are projecting entry into the clinic in 2005.

2005?

Right.

Yes, okay. Can I have one additional question?

Sure.

On, regarding the IL 15 project, you said, I think that was also in your previous statements that Amgen will continue to enroll patients as long as antibody is not available, does that mean, whatever you have in the stocks or how is that going to run? Is it Amgen that is paying for all these stuff and what is the limit of this?

Ann, I don't think we can probably discuss how much material is available and Amgen has made its own decisions about what dosing strategy it will be using in the ongoing Phase II. So, there really isn't anything to add in terms of the number of patients beyond what we have said. We know there will more than 110 at Genmab originally involved. Amgen is carrying on its own development of manufacturing work, now just like it's carrying on the clinical trial.

So, what they will have available for us to apply again will be up to them. The only thing I can say is that, without additional patients, we think it would have been difficult to take a 110 patient Phase II and go to Phase III. We think that with the addition of patients, it is much more possible to be ready for Phase III. That much we do know, but we will have to wait for Amgen for results of this study.

But there is no burden on your financials, how many patients they are taking in?

No. We have no further cost obligations. We had a transition period as we handed this study over to them and they reimbursed us for the cost that were incurred during that time period, even though the study was ongoing, because as of July 1, it was their program.

Okay, great. Thank you very much.

Sure.

Your next question comes from Peter Welford with Merrill Lynch. Please state your question.

Hi Lisa. Just three quick questions if I can. The first question is I believe you've alluded before that the high dose data for the HuMax-CD4 and CTCL may be available around mid this year. Can you sort of confirm that? And secondly, the HuMax-Inflam, I don't know if I missed the Phase I/II date or whether that hasn't been put out yet, but I thought that was due quite soon. And finally, the HuMax-CD4 rights, I noticed in the Annual Report that you only have rights to US and a few other territories, Could you close out for us who has the rights to Europe? Thank you.

Okay. Thanks Peter. The high dose data as I've said this a little while ago, it's all part of this open label expanded Phase II. So, the 560 mg and then, 980 mg are ongoing. I think it's reasonable that we may have data in the first half of the year. But we haven't given any guidance as to a specific event or time. As to HuMax-Inflam, that study is ongoing and we haven't released any data from it yet and I can't give you a time line for when that data will come out. The CD4 rights, when Genmab was founded, Medarex had already licensed the rights to that antibody in Europe and Japan and broadly defined Asia to a Japanese company. So, they have those rights. To the best of our knowledge, they are not doing any specific development work with them. So, there isn't a competing development going on.

If I could just ask a follow up, would you ever consider the cost of those rights...

I think it's always a possibility depending on how our clinical trials are going. Sure.

The next question comes from Astrid Samuelsson with Handelsbanken. Please state your question.

Hi. I wonder if you could give more precise guidance on when you'll have the outcome of the studies on Humax - EGFr ?

I think it's pretty hard Astrid for us to say at the moment. I never like to try to predict accrual rates in clinical trials. We have promised the data for this year and we have every reason to expect we'll finish enough of that study to be able to talk about it. It is an open label study.

Thanks.

Once again, ladies and gentlemen, if you do have a question, please press star one on your pushbutton telephone at this time. The next question comes from Samir Devani with CODE Securities. Please state your question.

Hi Lisa. Quick question on the Anti-CD20. Can you just tell us with what patient groups the Phase I/II study is going to be done in?

The initial study Samir will be in patients with follicular lymphoma. We think that this a fairly substantial group and it gives us an opportunity to collect safety and some efficacy data on a fairly large patient group. If you recall the design of the Phase I/II study, we gave a single dose. It is a dose escalating study. Then, we watch four weeks for safety and then we retreat for another four weeks. So, patients will receive five doses of the antibody. At the highest dose level, I believe we don't redose with the highest as we go back a step, but it gives us an opportunity to have not only safety data, but to get an initial look at efficacy in this population.

That's great. Thank you.

The next question comes from Stephen with Medical Strategy. Please state your question.

Hi Lisa. Question on HuMax-EGFr. I think there are some important patents held by ImClone. So, could you explain your situation there? Whether you are competing with them or whether the patents are not a problem?

Let me tell you what I believe that patent situation is you're referring to. ImClone has a license to some patents originally filed by Rohr to talk about the method of treatment claim using an EGFr receptor antibody in combination with chemotherapy. Now, those patents will not issue all over the world. For example, the World Patent Organization did not include Denmark at the time that the patents were filed. So, if the question is how will we go forward if we think a combination strategy is a good way to work. The answer is we could perfectly, legally either in Denmark or in the US under the generic drug laws conduct a study using a combination of our antibody and chemotherapy. You will notice there is another antibody in development where that's exactly what has happened. So, our strategy for going forward is to look at a variety of indications, to think about which one might help us get the best path to approval and depending on what happens with those patents, I don't know whether other companies will challenge. They may not because there are receptive products. To think about one possibility, antibody alone approval, at the same time, we could very reasonably collect data to look at the possible safety and efficacy of our antibody in a combination even if we weren't using that ultimately to file for our initial approval. I think that those patents exist their method of treatment claims. I don't believe they are barred to our clinical development.

Okay. Thank you.

The next question comes again from Sally Bennet with ING. Please state your question.

Hi Lisa. Sorry, just a quick follow-up. I am not sure whether you've disclosed this or I just can't remember. When is the next milestone due or would it be due from Amgen on IL15. Is it the start to Phase III or would it be the conclusion of filing.

We have not disclosed the timing of the milestones that was not part of the press release other than to say that they are fairly standard milestones. So, unfortunately I'm not in a position to talk about the specifics of the milestone based on our agreement with Amgen.

Okay.

As a final reminder, ladies and gentlemen if you do have a question please press star one on the push button telephone at this time. Our final question comes from Mattias Haggblom with ABN AMRO. Please state your question.

Yes, good afternoon. This is Mattias Haggblom from ABN AMRO. Just a question regarding the Roche collaboration, which you haven't mentioned lot about. Could you say anything about sort of potential for moving into the clinics from that collaboration today on your current view and where you are in the preclinical stage?

If you look back, Mattias, at the last press release we did when we achieved a second milestone with Roche saying that they have been able to move this collaboration faster than expected and that there are more programs than originally expected, so I think we can say that it's going very well, there are a number of preclinical programs all to targets identified by Roche. They have not made any public statements about when they expect to move products into the clinic. So I'm not in a position to really add anything to that other than to say that there is a lot of commitment on the Roche side to bringing along antibody therapeutics.

Okay, secondly could you mention whether or not you will look for any sort of clinical endpoints in the HuMax-CD20 trial or will it just be safe in the first sort of trial you are doing HuMax this year?

We - obviously the first goal of that study is to safety. It's a Phase I/II, but the secondary goal is to look at efficacy. In terms of response rates, as I said, it's a total of up to five doses for the patients and the doses if you remember the press release range up to the typical dose used with the CD20 antibodies on the market and slightly higher. So, I think there is a good possibility that we will be able to see some preliminary efficacy data here.

Perfectly thanks.

There are no further questions, I would turn the conference back to Dr. Drakeman to conclude.

Once again thank you all for joining us call today, we appreciate your interest in Genmab. We are very happy to have had what we consider a strong 2003, and we look forward to 2004. Thank you and good-bye.

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