Spectrum Pharmaceuticals Inc (SPPI) 2008 Q4 法說會逐字稿

Greetings ladies and gentlemen, and welcome to the Hana Biosciences fourth-quarter and full-year 2008 earnings conference call. My name is Scott, and I will be your coordinator for today. (Operator Instructions). As a reminder, this conference call is being recorded for replay purposes.

I would now like to turn the presentation over to your host for today's call, Mr. John Iparraguirre, Chief Financial Officer of Hana Biosciences. Please proceed, sir.

Thank you Scott. Good afternoon everyone, and thank you for joining us to discuss Hana's corporate and clinical progress as well as our financial results for the fourth-quarter and full-year 2008.

With me today on the call is Dr. Steven Deitcher, Chief Executive Officer and President of Hana Biosciences; and Dr. Anne Hagey, Hana's Chief Medical Officer. Steven will begin the call today with an update on the Company and recent progress related to our core Marqibo clinical program. Anne will subsequently discuss progress on our core menadione program. I will then review the financial results for the year and fourth quarter ended December 31, 2008. We will then open up the call for your questions.

Before we begin we would like to remind you that we will be making forward-looking statements [throughout] this call regarding our operations, product development, and market opportunities. These statements are subject to a number of risks and uncertainties as described in our SEC filings. For further information on our SEC filings, please visit our website at www.HanaBiosciences.com.

With that said, I will now turn the call over to Steven.

Thank you John. Good afternoon and thank you for joining us today.

During 2008 we achieved consistent and meaningful progress in advancing our two lead product candidates -- Marqibo and menadione topical lotion -- in their respective pivotal and proof-of-concept clinical trials. Both of these new, differentiated drug candidates target markets with sizable commercial potential and therefore offer substantial growth opportunities for Hana.

As a reminder, Marqibo is an OPTISOME-based, vincristine dose-intensifying product candidate that we are developing for acute lymphoblastic leukemia -- or ALL -- in second relapse, where there are currently no approved or standard therapies.

Menadione topical lotion is our first-in-class product candidate for the prevention and/or treatment of the skin toxicities associated with EGFR inhibitors such as the approved drugs Erbitux and Tarceva. Currently there are no products or therapies FDA-approved to treat these skin toxicities.

Let me now discuss in more detail our positive progress with Marqibo. We have defined and reaffirmed a clear regulatory pathway for Marqibo and are successfully executing a fast-to-market strategy for potential launch next year, 2010. We are continuing to move forward in the clinic with our ongoing pivotal rALLy clinical trial of Marqibo in ALL after achieving a prespecified response criteria to proceed to full enrollment in September of 2008.

Earlier this month we reported exciting preliminary efficacy results from a planned interim analysis of the rALLy trial that we believe fully support our plans to submit a new drug application for accelerated approval of Marqibo upon the trial's successful completion. Specifically, the interim analysis revealed nine -- or 31% -- of the first 29 evaluable patients achieved a complete response -- CR -- or complete response without full hematologic recovery -- CRI.

Since the outset of the rALLy trial our target response rate has been 16% complete responses, namely CR or CRI, which equates to nine or more of the target evaluable population of 56 patients. Thus, we are strongly encouraged by these excellent preliminary results that show we have already met our overall study goal with regards to the number of complete responses after analysis of only the first 29 patients.

The interim analysis also showed that the estimated median overall survival in responders was 10.5 months compared to 5.1 months in non-responders at the time of the data cut-off. Furthermore, because six of the nine patients with CR were still alive at that time, the median overall survival in this group may prove to be longer.

We also announced in March 2009 the results from a planned, prespecified safety review of data from the rALLy trial conducted by an Independent Data Monitoring Committee, or IDMC. The IDMC meeting outcome continues to support the acceptable safety profile observed with Marqibo in earlier studies, and no new safety concerns were identified. Based on these findings, the IDMC recommended that the trial continue to completion per the protocol.

The trial has now accrued 80%, or 45 patients, of the total target enrollment of 56 patients, and recruitment remains on target to complete by mid 2009.

We plan to file an NDA for accelerated approval in the first half of 2010. Our fast-track designation will provide the ability to file using a rolling submission and eligibility for a priority review.

We remain on schedule for possible NDA approval for the treatment of second relapse adult ALL with Marqibo by the end of 2010. Our goal is to have a confirmatory trial, imminent or ongoing, by the time we submit the NDA. To this end we continue to make progress with both US and European cooperative groups and strive to initiate a confirmatory trial that will not only allow for conversion to a full approval in relapse ALL but also may facilitate a label expansion.

Now let me turn the call over to Anne to provide a menadione update.

Thank you Steven.

In 2008 we initiated a phase 1 menadione topical lotion trial in healthy volunteers with intact skin and an early phase visual proof-of-concept trial in cancer patients prescribed an EGFR inhibitor. In December 2008 we announced the successful completion of the phase 1 clinical study in healthy volunteers.

Study results showed that menadione topical lotion applied twice daily to the entire face, anterior neck, anterior torso, and upper arms was not appreciably detected in the bloodstream at all doses tested. This favorable lack of systemic absorption combined with favorable immunohistochemical evaluation of skin biopsy specimens support the Company's mid- and late-phase development plans.

The study in cancer patients receiving EGFR inhibitors for anti-cancer therapy in both rash-emergent and rash-preemergent settings is ongoing. This study involves split-face and split-body dosing with menadione topical lotion or matching placebo lotion lacking the menadione active ingredient.

We are enrolling both groups of patients concurrently, have had a successful Data Safety Monitoring Board -- or DSMB -- review and are generating very useful photographic image data. We expect to complete this clinical trial in cancer patients by the end of the third quarter 2009. In addition we are planning to initiate a randomized phase 2 trial.

I will now turn the call back over to Steven.

Thank you Anne for that encouraging menadione update.

In terms of other corporate progress, we continued to build our Management team and Board of Directors with industry veterans during 2008. Dr. Anne Hagey joined as Vice President and Chief Medical Officer, Gradon Knotts joined as Vice President of Business Development, Thomas Tarlow joins as Vice President of Regulatory Affairs and Quality, and Dr. Christopher Salentine was promoted to Vice President of Manufacturing and Chemistry. Paul Meyer, a highly respected financial professional, joined the Board of Directors as Chairman of the Audit Committee.

We achieved all major stated milestones. We have strong momentum in our core clinical programs. As a Company we remain focused on carefully managing our cash and human resources and focusing our investment spending as we look ahead to achieving additional important milestones during 2009.

Thank you everyone for your attention. I would now like to turn the call over to John, who will review our financial results.

Thank you Steven.

I will begin my comments today upon the results for the quarter ended December 31, 2008 and then discuss our full-year, December 38 (sic - see press release), 2008 results.

The Company reported a net loss of $6.1 million including noncash expenses, or $0.19 per share, for the three months ended December 31, 2008 compared to $3.6 million, or $0.10 per share, for the same period in 2007.

Research and development expense for the quarter ended December 31, 2008 was $5.4 million compared to $3.9 million for the three months ended December 31, 2007. The increase in research and development costs was primarily due to increased spending for clinical development of Marqibo and menadione.

General and administrative expenses totaled $1.2 million for the quarter ended December 31, 2008 compared with $1.4 million for the quarter ended December 31, 2007. The decrease is primarily due to decreased personnel-related expenses.

For the year ended December 31, 2008, Hana reported a net loss of $22.2 million including noncash expenses, or $0.69 per share, compared to $26 million, or $0.85 per share, for the same period of 2007.

Research and development expense for the 12 months ended December 31, 2008 was $18.4 million compared to $21.3 million for the 12 months ended December 31, 2007. The decrease in research and development costs was primarily due to decreased spending on earlier stage pipeline programs partially offset by increased spending for clinical developments of Marqibo and menadione.

General and administrative expenses totaled $5.8 million for the year ended December 31, 2008 compared to with a $8 million for the year ended December 31, 2007. The decrease was primarily due to decreased personnel-related expenses.

On December 31, 2008 Hana Biosciences had approximately $14.1 million in cash, cash equivalents, and available-for-sale securities. We continue to proactively manage our cash resources.

Cash used in operations was $4.7 million for the fourth quarter 2008, below our previously issued guidance of $5 million to $7 million per quarter cash burn. And this was without delays in our clinical development program.

Pursuant to terms of the Company's financing commitment with Deerfield Management, Hana has $7.5 million in funds that may become available in 2009 including $5 million on April 30, 2009.

Hana continues to focus investment spending on our core clinical programs and expects our current cash balance along with funds available to us through the Deerfield agreement will enable us to deliver valuable clinical data from Marqibo and menadione and to further advance these key pipeline programs into the fourth quarter of 2008.

Thank you for your time and attention. And we now welcome your questions.

(Operator Instructions). George Zavoico, Westport Capital Markets.

A quick question regarding the menadione trials. I presume with the rash -- what evidence do you have that was with the rash that the menadione doesn't get through systemically? And are you still going to be monitoring that in the trial?

Well, we have early pharmacokinetic data from the cancer patients on the menadione trial that corroborate very nicely with levels seen in the healthy volunteer subjects' pharmacokinetic data. We will continue to collect pharmacokinetic data from the rest of the patients enrolled on the cancer patient trial as well.

Was -- how much menadione actually -- was actually observed or measured?

Very negligible levels right around the lower limits of detection.

Which is I guess right where you want it to be?

Exactly.

Absolutely George. Thank you for that question.

(Operator Instructions). At this time there are no further questions so I would like to turn the floor back over to our Management team for any closing remarks.

Thank you everyone for attending this call, and we look forward to continuing to advance our programs and interacting with you and receiving your input and recommendations in the future. Thank you very much.

Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you very much for your participation and have a wonderful day.