Radius Recycling Inc (RDUS) 2016 Q2 法說會逐字稿

Greetings and welcome to the Radius Health second-quarter 2016 financial results conference call.

(Operator Instructions)

As a reminder, this conference is being recorded. I would now like to turn the conference over to Barbara Ryan, Investor Relations for Radius Health. Thank you, ma'am, you may begin.

Thank you, operator. Welcome and thank you to those of us joining on the line and the webcast this morning for a review of Radius Health's second-quarter 2016 financial and operating results. I am Barbara Ryan, Radius Health Investor Relations Officer, and with me this morning to discuss the results and update you on our progress are Robert Ward, President and Chief Executive Officer; Dinesh Purandare, Head of Oncology; and Nick Harvey, our Chief Financial Officer.

Before we begin I'd like to remind you that any statements made during this call that are not historical are considered to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these statements as a result of various important factors including those discussed in the risk factors section in our most recent annual report on Form 10-K filed with the SEC and our other reports filed with the agency. Any forward-looking statements represent our views as of today, August 4, 2016 only.

A replay of this call will be available on the Company's website, www.radiuspharm.com, following this call. You can find the dial-in information for the replay in today's press release as well as on the Company's website.

I would now like to turn the call over to Robert Ward, President and Chief Executive Officer of Radius Health.

Thanks, Barbara, and thank you to everyone who has joined us on our conference call and audio webcast this morning. The first half of 2016 has been an exciting period for Radius Health and we've achieved a major milestone in the second quarter with the FDA's acceptance of our NDA for abaloparatide subcu for the treatment of postmenopausal women with osteoporosis. And we have been given a PDUFA date of March 30, 2017.

The next several quarters will be equally exciting for us as we continue the regulatory review process in Europe and the US and continue our negotiations regarding partnerships. We have already made steady progress in preparing Radius for the launch of abaloparatide pending favorable regulatory review and we will continue to build on the momentum. We ended the second-quarter 2016 with $400.9 million in cash and equivalents and are well funded to continue to develop our portfolio and launch abaloparatide with a partner.

Our marketing application authorization, or MAA, for abaloparatide subcu was validated by the European Medicines Agency, or EMA, in December 2015. And we anticipate being notified in late 2016 or 2017 of the Committee for Medicinal Products for Human Use, or CHMP, scientific opinion for abaloparatide subcu. We're highly confident that abaloparatide has the potential to become an important medicine for the treatment of osteoporosis.

This fall at the American Society for Bone and Mineral Research we're extremely pleased to have been notified that four of our abstracts for abaloparatide have been accepted for presentation in September. Most importantly, an abstract of the results of the human replicative PK study of an optimized transdermal patch in postmenopausal women, which we initiated in December of last year, was accepted to be presented as an oral late-breaker on September 19 at the meeting in Atlanta.

We plan to host an investor event to review the data and will update you on the details of that as we get closer. We will look forward to sharing the update with you at that time. Also in this quarter we continued our ongoing trial of vasomotor symptoms.

Now I'd like to turn your attention to substantial progress we have made with our oncology portfolio. And I'd like to introduce Dinesh Purandare, our Head of Global Oncology, to share this important new oncology information with you.

Thank you, Bob. As of end of July the expansion cohort of RAD1901 in advanced breast cancer has enrolled 19 out of 20 patients at 400 milligram dose. And we expect to enroll the final patient in this Phase 1 Part B expansion cohort shortly.

We believe that the results from this expansion cohort will enable us to accelerate our overall development planning for Phase 2. At this time, we are not enrolling patients in the Part A dose-escalation cohort.

We also continued to grow patients in the European Phase 1 FES-PET trial. The first dosing cohort is enrolled and all patients are continuing on drug. We are pleased with the progress across these trials and we expect to provide an update on RAD1901 program at an upcoming scientific meeting.

We believe that all selective estrogen receptor degraders like RAD1901 are uniquely suited to potentially become the backbone oral agent of combination therapy for hormone driven or hormone resistant advanced breast cancer. Some of the exciting clinical advances in advanced ER positive breast cancer therapy have come from the use of combination of SERDs like Faslodex with CDK4/6 inhibition.

We guided that we plan to enter into clinical collaboration agreements in addition to the one we have with Novartis to explore combinations of RAD1901 with other agents including CDK4/6 PI3 kinase inhibitors, mTOR inhibitors and PARPs. Today I'm pleased to announce that we have initiated a very important preclinical collaboration with Takeda that will study RAD1901 in combination with their promising mTOR 1/2 inhibitor.

Also in this quarter we have made substantial progress with RAD140, our preclinical selective androgen receptor modulator. The unique receptor modulator profile of RAD140 has a demonstrated potent tumor growth inhibition and breast cancer xenograft models as both a single agent and in combination with CDK4/6 inhibition.

We are particularly interested in RAD140's activity in upregulating tumor suppression pathways that are unaffected by traditional SERM/SERD agents. This characteristic may translate to a unique clinical utility for RAD140 in breast cancer.

Today we are planning a clinical trials application to enable initiation of Phase 1 studies with RAD140 and we anticipate sharing additional information at scientific meetings this fall. The progress with RAD1901 and the recent discoveries around RAD140 provide us with two very promising opportunities to expand our research and development efforts in breast cancer.

Over to you, Bob.

Thank you, Dinesh. I'd now like to ask Nick Harvey, our Chief Financial Officer, to discuss our second quarter and provide an update on our balance sheet.

Thank you, Bob. For the three months ended June 30, 2016 we reported a net loss of $43 million, or $1.01 per share as compared to a net loss of $23 million, or $0.61 per share for the three months ended June 30, 2015. The increase in net loss from the 2015 period to the 2016 period included an increase in non-cash stock-based compensation expense and was primarily attributable to the growth of the organization to continue our pipeline development and to prepare for the potential commercial launch of abaloparatide subcu.

Following acceptance of the Company's NDA submission for review by the FDA, the Company made a milestone payment of EUR3 million to Ipsen which was expensed during the three months ended June 30, 2016. We have experienced substantial growth in our headcount which currently stands at 160. As Radius continues to advance towards the first commercial sale of abaloparatide subcu we expect to continue to expand our headcount and to make further investment in launch preparations.

Our cash, cash equivalents and marketable securities balance as of June 30, 2016 was $400.9 million. We believe that our cash, cash equivalents and marketable securities balance prior to the consideration of revenue from the potential future sales of any of our investigational products or proceeds from partnership activities is sufficient to fund our development plans, US commercial scale-up and other operational activities into 2019.

I will turn the call back over to Bob.

Thank you, Nick. Before we open the line for your questions I'd like to summarize our upcoming milestones for the remainder of the year. The next nine months will continue to be exciting for Radius as we look forward to executing on a number of substantial milestones and prepare to become a commercial Company.

Our MAA is under active review in Europe and we expect to receive a CHMP opinion in late 2016 or 2017. And the FDA has granted a PDUFA date of March 30, 2017 for our NDA.

We are actively engaged in partnering negotiations and expect to enter in a collaboration by the time of our first commercial launch. At the same time, we are busy building our internal marketing organization and the launch costs are already funded on our balance sheet.

We look forward to reporting data from our transdermal patch, crossover PK study in postmenopausal women on September 19 at ASBMR. And the results of this pilot study will be important for designing a formal bioequivalency study for regulatory submissions for this potential line extension.

We believe that abaloparatide is the greatest value unpartnered late-stage asset in the biopharm industry and we are continuing our productive partnering discussions. Our Phase 1 dose-escalation study and FES-PET study for RAD1901 in MEST ER-positive metastatic breast cancer are ongoing and we plan to report the results as well as an update on the program in a scientific meeting.

This fall we will also be sharing new preclinical data on the RAD140 program and our plans to initiate first-in-human studies. These two programs establish a significant presence for Radius Health in the search for new treatment options for patients with advanced ER-positive breast cancer.

We will also be making presentations at three investor conferences over the upcoming weeks: the Canaccord Annual Growth Conference here in Boston on August 10, the Citi Biotech Conference in September on the 7th and 8th as well as the Rodman & Renshaw Global Investment Conference on September 13.

Thank you for your attention. We now like to open up the call for your questions. Operator?

(Operator Instructions) Jessica Fye, JPMorgan.

Good morning. Thanks for taking my question. I was hoping you could talk a little more about 1901 with the expansion cohort almost fully enrolled here.

Can you tell us what dose you went up to in the Part A dose escalation? What ended up being dose-limiting tox if anything?

And I'm just curious with 400 being the starting dose in the ongoing FES-PET study it would almost suggest you might've expected to go higher. Can you talk about your competence in 400 being the right dose?

And will the upcoming medical meeting for the 1901 update be in 2016? Thank you.

Thank you, Jess. Those are great questions. If we think about the 1901 program when we spoke last we were in the dose-escalation phase which was designed to start at 200 and go up to 1,000 milligrams.

In the 3+3 design one of the key questions is tolerability for programs for the patients who are enrolled. The 400 milligram dose had the best combination of tolerability and activity. And that's why the 400 milligram dose was taken forward into the Part B safety expansion cohort of which 19 of 20 are currently enrolled.

On the FES-PET program, the FES-PET program also initiated at 400 milligrams and so the cohort there was filled at 400 as well. Both of those trial designs are on clintrials.gov, so for folks who are interested in looking at it in greater detail they can find a description of both trials at that site.

And yes, Jess, as we think about scientific meetings, particularly in oncology, abstract submission is typically about six months in advance of when the meetings take place. So we have submitted abstracts to scientific meetings on both 1901 and RAD140. And as we have greater information back from the conference organizers, of course we will share that with the street.

Got it. Thank you.

Ying Huang, Bank of America.

Good morning, thanks for taking my questions. So Bob, maybe I wanted to probe a little bit more on the 400 milligram dose for RAD1901.

So far based on the Part A of the Phase 1 trial here from different doses you tested, do those data correspond to what you saw in the preclinical test or not? Because I remember you went all the way to 1,000 milligrams before that.

Then a second question is that you guys don't have on and oral late-breaker at ASBMR. I mean it's a silly question, but still I assume this usually portends that it's a positive data set at ASBMR.

And then maybe lastly, can you remind us if there are any noncommercial drugs out there or drugs in clinical trials that are using the 3M patch technology here. Thank you.

Sure, Ying. Great questions. I will just take them in reverse order since the third question was the easiest question.

For 3M we are the most advanced clinical program. And Dr. Hattersley will be giving the oral presentation at ASBMR. And Dr. Hattersley to date if you think of the number of administrations, both in the original 2A through to clinical exposure today, can you just remind us of what is the clinical experience for Radius with transdermal patch?

Absolutely. So at this point we've completed three Phase 1 clinical studies and a Phase 2. In between those four clinical studies we have applied over 36,000 individual patch applications, so at this point we have a lot of experience with this patch technology and are very encouraged by the emerging profile.

Terrific. And when we think about patches, some of the areas that folks look at are both in the FDA has online and guidance which is around bioequivalents such as dry towel bioequivalence as assessed and the PK parameters associated with that.

And then also on the FDA website if one did a search on transdermal patches you will see that the generic division where quite frequently patches have been used they describe also the dermal tolerability profile. So on the FDA website there's a number of guidance is or other materials that they provide that gives a good insight into how the agency looks at transdermal patch technology.

Dinesh, coming back to a moment to 1901, I know that one of the questions was in our original healthy volunteer study, we started at 200 milligrams and went up to 1,000 milligrams and then we conducted with healthy volunteers a FES-PET imaging of both 200 milligrams and 400 milligrams. Now in the expansion cohort that's currently ongoing, 19 of 20 are enrolled. Could you talk a little bit more about what we'll be assessing in that trial?

Sure. So we are this trial is progressing nicely. We are genotyping the patients.

I know that there are several mutations in the estrogen receptor mutations. We are also evaluating the circulating tumor cells at baseline and at the end of the treatment. And data to date shows the decrease in circulating ESR1 mutant DNA suggesting a decrease in number of mutation-bearing tumor cells.

This is pretty encouraging. And in this trial I just want to remind you that we will be using RECIST criteria to evaluate patient outcomes which include clinical benefit, duration of stable disease as well as assessing tumors for partial or complete responses.

And last but not least, we believe that this expansion cohort will enable us to move faster in our planning for our Phase 2. And we hope to be back with more on this trial at an upcoming meeting.

And I believe you had a second question which I might have missed. Was there a second question there?

Yes, I was talking about the oral late-breaker at ASBMR. So many investors think since you've got the oral late-breaker it probably means that it's a pretty positive data set.

Well, I think that we're fortunate that the organizers of ASBMR, they make a scientific judgment of what is the content that they find meaningful for the membership. And I think there's a high level of interest in transdermal patch, so we're very much looking forward to both the oral presentation and the investor event that we'll have around the time of ASBMR.

Great, thank you for the color.

Salveen Richter, Goldman Sachs.

Thank you for taking my questions. Just wondering given that the CHMP opinion is a few months away for abalo maybe you could just walk us through or provide an update here on the progress of discussions with potential ex-US partners and is there any chance that you could delay the ex-US launch here? And then with regard to the transdermal patch data at ASBMR, could you maybe explain to us what you want to see and what's sufficient to inform the bioequivalence trial in terms of next steps?

Why don't I take those in reverse order, Salveen. So first of all with bioequivalence, in the FDA guidance to bioequivalence you'll see that they provide a description of what would be a pilot PK program as well as a formal PK program.

And the guidance is I think pretty illustrative of the type of information that are required. When we look at a program the first thing we do is check with the FDA in terms of what is their expectations and then design a program to address really the questions that they have outlined in those guidances.

With regards to overall preparation for abaloparatide, we don't comment on ongoing regulatory matters as we're under active review both in Europe and here in the US. We are very pleased with the progress today.

And I would ask David Snow, who is our Chief Commercial Officer, to give us an update, David, on the preparations. And then as we think about becoming the potential for abaloparatide as a global brand, how are we prepared for that as well?

Thanks, Bob. I'm very pleased to say we're continuing to advance our abaloparatide subcu launch preparations overall. We still see an incredibly attractive market in the US and abroad.

The best way to describe that is we see that the market has low competitive intensity but highly promotionally sensitive. There's just two players in the market. You saw Amgen's recent results suggesting a 30% year-over-year growth.

That's pretty impressive. We expect that that product will be over $1 million this year in the US alone.

Lilly continues to grow. They have a 29% growth rate overall. I think this is a great indication that globally and especially in the US physicians are increasingly comfortable with injectables in osteoporosis.

I'd also mention that Merck also has made some progress on their oral agent that targets a different patient set. However, we think that we see it as a complementary mechanism to abaloparatide.

As far as partnerships we continue to have productive partnership discussions ex-US and our goal is to have this in place by the time of launch. We obviously are looking for partners who have specialty launch experience that have a great footprint within Europe and we are continuing those discussions. The net result is to position abaloparatide to become a global brand and provide us with the greatest optionality to achieve the overall best outcome for Radius.

Yes, if you think of the team you have put in place, David, they have addressed not just what would be necessary for commercialization here but really some of the key elements around the world. I mean in Europe, for example, health economics plays a very important role and preparing the health economic dossier or preparing for reimbursement is certainly critical to enable a timely global launch. Could you tell us more about some of the people that are working on the brand today?

You're absolutely right. That's a critical component for launches everywhere, but especially in Europe where you need to have a very strong overall health economics outcome. And we've engaged several top key opinion leaders that are engaged with us to do market level econ analysis, helping us with the overall program.

And I'm very pleased to be working with Lorie Fitzpatrick on this. We have a very strong team behind us that's making sure that we translate this great or this active data set that we've got into a very practical decision-based tools for payers in Europe and also in other markets.

So Lorie, with ASBMR and also with the medical science liaison group that you have put together, I believe today we have the largest medical science liaison group in the field of bone. Perhaps you could talk about the type of candidates we're attracting and how is scientific or medical communication progressing?

Thanks, Bob. Actually our MSL team is not only one of the largest, it's one of the best.

We've actually skimmed the cream off the top, as we say, and really have some great people we've recruited who have deep and extensive experience in the field of bone. So we're very pleased with the way that that's shaped up and we're looking forward to continuing to recruit top-notch people.

Regarding the ASBMR, we're really lucky that we have three abstracts on abaloparatide subcutaneous and we are very excited about the data there and we will look forward to showing that to everyone in September. In addition, we have a lot of exciting preclinical and clinical data in review right now and we will have pivotal data published very soon.

Excellent. We will look forward to that. Thank you, Salveen.

Mara Goldstein, Cantor Fitzgerald.

Thank you very much. I had a question as it relates to the commercial plan and the patch.

I believe last year discussion around the opportunity for the patch, one of the things that the Company said was that it might look to partner them separately. And as we are approaching what would appear to be some fairly pivotal data for the patch set, I'm wondering if the thought on the commercial prospects and how that product goes to market have changed at all?

No, Mara, you ask a very good question. When we look at the market today, I think David shared just a moment ago that injectables represent the bulk of the current sales in osteoporosis of branded products. But if we look at the total number of physicians treating patients with osteoporosis there's a substantially larger number of physicians prescribing oral agents than the number prescribing injectable agents.

For many of those physicians who are really using only oral agents they've not previously accessed anabolic therapy for their patient population. Now when we think of other markets that are in analog once upon a time the TNF market was really an oral market and the penetration of injectables was a minor element of how treatment was managed.

Today I think many of us would say injectable products are first-line in the rheumatoid arthritis or the associated indications for the anti-TNFs. We anticipate that we will see a similar evolution in osteoporosis. The pipeline has never been richer.

This is a revolution where for the first time there's a number of new molecules in late-stage development that offer the opportunity to change the treatment paradigm. For physicians who are not routinely training patients on the use of injectables or not managing an injectable practice patch becomes an accessible way to easily introduce into their practice the potential access to anabolic therapies. So we do believe that patch will find a place in the market that's different than the areas where physicians will continue to prefer the use of subcutaneous injectable agents.

And we do think that, therefore, the marketing for patch is somewhat different than it would be for an injectable product. But when we talk to folks in the market today about what are the products where physicians feel that their introduction has been particularly successful we hear time and time again that with HUMIRA the way they've developed training programs, patient support programs, physician education is really viewed as top-notch and has set a real standard for how does one provide not just the therapeutic or the clinical trial but then provide the ways to make that accessible for physicians and patients as a real requirement in the market.

And we do think transdermal patch will have a different use of physician practices and the support around it is different than it is for daily subcutaneous self-administered product as well. So we do think that the way they will be commercialize will be different and, yes, as we talk with partners about the long-term vision for the brand, launches especially biologic pending positive regulatory approval, and then grow out into primary care still within the high unmet medical patient population, different partners have different capabilities and different views on how they want to participate regionally, globally. So we are looking for how to maximize shareholder value.

Okay. And if I could also ask, pivot for a second onto the oncology program.

And just broadly speaking given the complexity and breast cancer trials and the state of the field today, I'm just various as to what your thoughts are on how best to pursue future development in later-stage studies which can be large and complex and unwieldy. Are you thinking that this will be optimally served via collaboration or you still plan to do these trials on a solo basis?

Right now, Mara, we have initiated some clinical collaborations and we're also doing some work independently because at this moment in time we think it's very important efficacy data that will be available in the near term that really makes a real decision how do you ideally develop an agent.

If you think of palbociclib, I think there's two lessons we would learn from that. The first was that the clinical data of that combination was significant enough that from a regulatory perspective it was really sped to the marketplace because of the potential for patient benefit. So accelerated approval based on efficacy is the key element.

But if you said the CDK4/6 is our optimizing that part of the combination, the second arm, this question of what's the best-in-class SERD is what we think will be the next major discussion point in breast cancer. How do we now optimize the hormonal therapy arm? Dinesh shared with us earlier that these patients are being genotyped because of the fact that for the estrogen receptor there are mutant patients that show resistance to many of the currently available agents.

So that represents a patient population where we think there's extensive high unmet medical need. Now remember the androgen receptor also plays an important role in modulating the estrogen response pathway. So whether it's addressing the estrogen receptor, the progesterone receptor or the androgen receptor, we think that hormonal therapy will have some important steps forward as we go through the upcoming months and years.

And that will help us identify how do you address the greatest unmet medical need so as the combination is developed, the patients who have the greatest potential for clinical benefit are addressed in the trial. So the progress we've made to date, particularly since this patient population will include patients who have previously been exposed to palbociclib, exposed to Faslodex or exposed in combination, many of whom have ESR1 mutants really gives us real insight as to the patients who have the potential to respond to a new either mono or combination therapy that in the past may not have had access to the efficacy that they need.

Okay, thank you very much. I appreciate it.

John Newman, Canaccord.

Hi guys, good morning. Thanks for taking the question and congrats on all the progress moving forward here.

My question is just regarding this whole question of whether or not there will be generic Forteo at some point. And I just wonder, Bob, if you could walk people through the various points in terms of that debate. I think there's a lot of moving parts, I was curious if we could get your view on that. Thanks.

John, when we look at the question of how would a regulatory agency address a complex product like Forteo, we do know it's approved as an NDA drug. The FDA had determined for peptides of 50 amino acids or less they are regulated on the NDA drug applications.

And if we look for an analogy and ask well, in the past for complex products that have been approved by an NDA, how would the FDA address the approval process it was generally in the case of human growth hormone with 505(b)(2). So when Pfenex announced that they were submitting a 505(b)(2) around Forteo, if I recollect correctly, their press announcement said that the application would include not just bioequivalence data but also comparative immunogenicity. We think that the approval process and the commercialization process is very different than when people think about what has traditionally been replacement of oral agents with generic drugs.

I mentioned a moment ago with HUMIRA that when we talked with physicians in the anti-TNF space about lessons learned and what has been important for their practice, time and time again we hear people talk to you about the fact that HUMIRA patient has the ability to call a hotline if they have a problem, they have a way to get questions, a way to be trained. And physicians really value the patient support that goes into enabling patients to use what today is a whole new range of more complex therapeutics.

When you think of Forteo, it is cold chain distribution and patients keep the product in the refrigerator. For a physician who has been prescribing that product for 10 years I'm sure if a patient calls and says they have a question about the pen the physician and their staff all know that pen because they've been working with it for over a decade in many cases.

So I think there's some elements around patient management and patient treatment that are very important so that physicians feel they are able to effectively ensure that the patients get the therapy they are prescribed. They are trained on how to use the pen and if a patient in the course of treatment has a question they have to have the ability to have a place to go to get that question answered so that they can experience the best clinical outcome.

So when we think of 505(b)(2) products in growth hormone we saw Teva launch Tev-Tropin. Novartis launched Omnitrope. There were five branded products in the market at the time.

And I think many years later the order of entry predicted really the market shares in many cases. And we saw that Novo Nordisk had continued to be the leader in human growth hormone. And when we ask physicians why did they see such a high preference for the Novo Nordisk offering they mentioned that Novo Nordisk has been an innovator in pen technology.

The types of Penn State introduced have been helpful for patients. So again it's not as simple as perhaps oral agents that go generic might be. Is that helpful, John?

Yes, great. Thank you.

Chris Shibutani, Cowen and Company.

Thank you. On this TD patch, the bioequivalence studies, can you help us understand if there are any quantitative parameters or thresholds? I know you referred to the FDA guidance.

But when we see the presentation that ASBMR, how will we be able to interpret what is good data? And you help us understand that a little bit?

Yes, Chris, the reason why the guidance is so helpful is it talks about the rules for bioequivalence. And when you think of our previous presentations of our Phase 2A study, remember that was a six-month comparative BMD study where in that trial we looked not just at pen performance or PK parameters but also manage your BMD increase.

And you will recall we showed a dose-proportionate increase in BMD. But since that PK profile was not bioequivalence to subcu we did not see comparable BMD as to the subcu.

Now when we shift over to really asking the question of how do you establish bioequivalence, it's all about the comparability of the PK profiles and that's well described in the guidance. So some of the things that we look for is the consistency of response and across our study it means that a patient has been exposed to both a subcutaneous product and to the transdermal patch.

So the PK data is derived from the same individual to enable those comparisons. But we will look forward to sharing those data at ASBMR in September.

And then if we were to think about moving forward, what would a pivotal study look like and what might be some timelines perhaps based upon your experience with enrollment of this pilot study, the comparability? Help us get a sense for what the next steps will look like and what the trial will look like.

Will that include a comparison placebo? Will it be a specific approval trial for the TD as a product? Or is it again more comparability alone?

Well, I think if you looked at Corium's website, C-O-R-I-U-M, they recently put a press announcement out about a Aricept program where they were taking Aricept into a transdermal patch. And they shared publicly that in their discussions with the agency that the agency had confirmed for them that bioequivalence would be the basis of approval for their transdermal patch.

We similarly believe that bioequivalence will be the key regulatory evaluation. And in the bioequivalence study, Chris, I would again really encourage folks to feel comfortable reading the FDA guidance because the FDA guidance talks about doing a pilot PK study. And what the pilot PK study does is it informs you on the variability of the different comparators and enables one to design a formal study.

So much of the space that we're at right now is around this pilot PK work that enables the design of what would be the formal bioequivalence study. The guidance lays out how the one helps inform the second.

But we do believe that bioequivalence will be the key parameter. But I would also encourage folks if you just do put in a Google search for transdermal patch on the FDA website, the generic drug division has also written a fair amount about transdermal patches that they have approved and some of the areas that they look at related to dermal tolerability. And they do have some descriptions of what are the types of data they look for and assess.

So as Gary had mentioned earlier because of the substantial experience we've had with patch over a series of trials and a number of administrations we feel that we have a good understanding of the tolerability profile. And we're looking forward to continuing to advance on what we had stated was our goal of demonstrating bioequivalence.

So from start to finish a pivotal 12-month time frame is realistic? 18 months? (multiple speakers) some parameters.

Yes, generally bioequivalence studies are considered relatively quick in the world of drug research. And they provide us a great deal of flexibility determining what's the right time to start the trial and also to make sure that we have our submission in in a timely fashion, as well.

Carol Werther, H.C. Wainwright.

Thanks for taking the question. Can you just discuss a little bit more since the launch in the US is possibly nine months away how many people you might be hiring and what monies you're setting aside for the launch? Thanks.

Yes, Carol that's a terrific question. Some of the details around that come into the area of there is competition in the space, and so we do want to make sure we're balancing out how we maintain our competitive advantages as we look at the marketplace.

But I do believe there's a fair amount of information available about products that are currently marketed in this space. And as David had mentioned it's very promotionally sensitive based on what we've seen today. So, David, when you look at the overall commercial requirements here in the US to be successful, can you give us some guidance of what we should expect?

Yes, I think we've guided previously to a salesforce size between 150 and 250. When we look at the market, again, there are generally two players in the market. This is a market that is heavily dominated by a couple of key specialties, endocrinology and rheumatology.

And there's really a high affinity of between 20,000 and 30,000 physicians who really do the majority of prescribing in this area, especially with the injectable. We see that is a very reachable market. We've got great data.

We're doing lots of market research in this area about who are these physicians who would be amenable to using injectable agents. And so we're well down the path of being prepared to reach that market.

That's a very good point. And if we think of why Amgen has been successful with Prolia, one of the elements has been bringing new prescribers of Prolia into the osteoporosis market. So we see an increase in the number of prescribers.

But it's interesting when you compare the Forteo prescribing base to the Prolia prescribing base, they overlap partially but not completely. So it's really interesting how the market that we will be targeting in many ways will be unique.

But in both cases, Carol, the size of the physician prescribing really fits what is typically considered a specialty biologic launch. With a highly concentrated number of prescribers it's able to be covered with really a specialty biologic salesforce.

Okay, that's really helpful. And do you have any plans for social media?

I think when we look at the marketing mix today social media plays a much more important role than it has historically. And the component of social media, whether it's in our recorded comments today being available online or how marketing goes about. But when you think about here when we're under regulatory review and then once we anticipate positive regulatory outcome once you have an approved product can you just talk to us about how do we then interact with the regulatory agency on determining what can be communicated to different markets or different groups?

I'm sure a lot of people are familiar with the fact that there is a tight affinity with the FDA in terms of putting in your promotional materials, getting approval there prior to starting that promotional activities. Once we get an approved label you can talk through that label and provide that information to physicians. And we will have a robust overall marketing approach in multiple channels to make sure we're reaching there.

I would say what's really important, as well, is we've got a really good device. And so in this technology, in this area really being able to support the patient through that diagnosis, being able to get them the information that they need quickly and effectively and also having a really well designed device that makes it easy for them to use is really a critical component of this particular category.

Thank you.

Thank you. At this time I would like to turn the call back over to management for closing comments.

Well, we thank everyone for joining us on this quarter. We think this is a very important time for Radius.

We've seen acceleration now in the clinical development activities on oncology. So we will be coming back with an update on what would be the next step trial for 1901.

We've guided that with 140 now our next step will be first-in-human studies, again targeting breast cancer. And with ASBMR right around the corner we will look forward to continuing to engage around the emerging profile for abaloparatide.

So thank you very much for your time today. And we'll look forward to talking with you on the next quarter.

Thank you. This does conclude today's teleconference. You may disconnect your lines at this time and thank you for your participation and have a great day.