Titan Pharmaceuticals Inc (TTNP) 2015 Q2 法說會逐字稿

Thank you for holding and welcome to the Titan Pharmaceuticals second-quarter 2015 financial results conference call. (Operator Instructions). Please be advised that this call is being taped at the Company's request and will be archived at the Company's website starting later today.

At this time, I would like to turn the conference over to Sunil Bhonsle, President of Titan Pharmaceuticals. Please go ahead, sir.

Thank you, Lisa, and thank you all for joining us. Welcome to the Titan Pharmaceuticals call to review financial and operational results for the second quarter of 2015.

Before we begin, I wanted to inform you that on August 13 we filed our second-quarter 2015 Form 10-Q with the SEC, and the press release issued that same day provides a summary of the results and can be found on our website Titanpharm.com

Joining me on the call today from Titan are Dr. Marc Rubin, our Executive Chairman; Dr. Kate Glassman-Beebe, Executive Vice President and Chief Development Officer; and Brian Crowley, our Vice President of Finance.

Before we get into the details of the financial results and provide an update on the Company, I want to remind everyone that certain matters we will discuss today, other than historical information, consists of forward-looking statements relating to, among other things, our expectations concerning our financial results, available cash, development programs, partnering arrangements, regulatory strategies, and business plans.

Forward-looking statements are not guarantees of future performance and are subject to a variety of risks and uncertainties that could cause actual results to differ materially from the results contemplated by the forward-looking statements. These risks and uncertainties are described in our annual report on Form 10-K filed with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today. We undertake no obligation to update or revise the information provided in this call, whether as a result of new information, future events or circumstances, or otherwise.

As always, let's start with an overview from our Executive Chairman, Dr. Marc Rubin. Marc?

Thank you, Sunil, and hello, everybody. Thank you all for joining us today. We are very pleased today to provide you with an overview of our activities in the second quarter and to discuss the development of our pipeline of product candidates based on our ProNeura long-term drug delivery technology.

As many of you know, during the second quarter Titan and our development and commercialization partner, Braeburn Pharmaceuticals, reported positive topline results from PRO-814, the final Phase 3 trial of our subdermal implant Probuphine for the long-term maintenance treatment of opioid addiction.

We were, of course, very pleased with these results. The study met the prespecified primary endpoint of noninferiority, as well as all secondary endpoints. Preparations for the NDA are progressing rapidly and its resubmission to the FDA is expected in the third quarter.

Probuphine, as you know, remains under priority review with the FDA and could potentially be approved in early 2016. If approved, Probuphine would be the first commercialized treatment for opioid addiction to provide continuous around-the-clock levels of buprenorphine for six months following a single treatment.

As a proprietary subdermal implant with patent coverage in the US to 2024, we believe Probuphine has several advantages over the daily-dose formulations of buprenorphine. And as you know, new treatments that are safe and effective are critically needed for patients, their families, and healthcare providers.

Dr. Glassman-Beebe will share with you the specifics of the trial results, as well as greater details on the development of our pipeline, momentarily.

We continue to believe that the successful development of Probuphine to date provides a strong validation of our ProNeura platform. The Board is very pleased with the progress of Titan's product development programs and we see great potential in ProNeura for treating a variety of diseases, diseases that require chronic treatment and that may benefit from non-fluctuating levels of medication in the blood over extended periods of time.

We are aggressively advancing our development plans for ProNeura-ropinirole for Parkinson's disease and we're on target to submit briefing materials to the FDA in the fourth quarter of this year to support a pre-IND meeting. We've also made progress in evaluating additional compounds that have the potential to be delivered via the ProNeura implant.

And finally, as you know, just a reminder that we have our shareholders' meeting scheduled for next Monday, August 24. And I will now pass the ball back to Sunil to review the financial results of the second quarter of 2015. Sunil?

Thank you, Marc.

Next, I will provide you with our second-quarter financial results, following which Dr. Glassman-Beebe will update you on the development activities during the quarter. We will then open up the call for your questions for the Titan management team.

For the financial results, total revenue in the second quarter of 2015 were approximately $0.8 million, compared with revenue of approximately $0.9 million in the second quarter of 2014. Both the second quarter 2015 and 2014 revenues consisted entirely of license revenue and reflect the amortization of the upfront license fee received from our partner, Braeburn Pharmaceuticals, in December 2012.

Total operating expenses for the quarter ended June 30, 2015, were approximately $1.9 million, compared with about $1.5 million in the same quarter last year. The increase of approximately $0.4 million in total operating expenses during the second quarter was driven primarily by higher research and development expenses, which totaled approximately $1.1 million, compared with about $0.7 million in the second quarter of last year. This increase was associated with external and internal development expenses related to the support of Titan's Probuphine and the ProNeura-ropinirole product development programs and other R&D expenses.

General and administrative expenses for the second quarter of 2015 and 2014 were approximately $0.8 million and $0.7 million, respectively. In reality, there was only about a $40,000 difference between the two quarters.

Net other expenses for the second quarter of 2015 were approximately $1.2 million, compared with about $0.3 million for the same period in 2014. Net other expense consisted primarily of non-cash losses -- changes in the fair value of warrants.

Net loss for the second quarter 2015 was about $2.3 million or $0.02 per share, compared with about $0.8 million or $0.01 per share in the same quarter in 2014.

At June 30, 2015, Titan had approximately $11.5 million in cash, which the Company believes is sufficient to fund planned operations into the fourth quarter of 2016, not taking into account the potential of $15 million milestone upon approval of Probuphine.

Now these financial results were as expected and, as you know, the positive topline results of the final Phase 3 trial of Probuphine mark an important milestone for Titan, and we are continuing to work closely with Braeburn in preparation for the resubmission of the NDA this quarter and also to prepare for potential commercialization next year.

Our Parkinson's program is well underway and we are enthusiastic about the important role ProNeura could potentially play in treating this devastating disease. We're also evaluating additional compounds that could potentially benefit from delivery via our ProNeura platform and we hope to add another product candidate to the pipeline in the next few months. We look forward to providing updates as we make progress.

Now to provide you an update of recent development activities, let me turn the call over to Dr. Glassman-Beebe. Kate?

Thank you, Sunil, and hello, everybody. I'm pleased to provide you with additional details on the development of our pipeline of product candidates based on our ProNeura technology, including our late-stage candidate Probuphine, as well as our ongoing work developing ProNeura-ropinirole for Parkinson's disease.

Following the announcement in June of the positive topline results of Probuphine for the long-term maintenance treatment of opioid addiction, we have continued to work very closely with our partner, Braeburn, to integrate the clinical and CMC information into the NDA document and to complete the full regulatory preparation activities of the Probuphine program leading to the resubmission of the NDA to the FDA during this quarter.

We've also completed the remaining activities associated with the validation of the manufacturing process and our contract manufacturer, DPT Laboratories, is ready for commercial manufacturing of Probuphine.

As we mentioned, the final Phase 3 double-blind, double-dummy clinical study of Probuphine nets the prespecified primary endpoint of noninferiority, as well as all the secondary efficacy endpoints. Analyses conducted according to the preplanned statistical analysis plan indicated response rates of 96.4% for the Probuphine arm and 87.6% for the sublingual buprenorphine naloxone arm.

Now in order to further evaluate the observed numerical difference between the proportion of responders in the two treatment arms, a sequential superiority analysis was conducted, and that indicates a statistically significant difference in favor of Probuphine over the sublingual buprenorphine naloxone treatment arm, with P value of less than 0.05.

The overall safety and tolerability profiles for each treatment group were comparable. The implantation procedures were also generally well tolerated and comparable to observations from earlier studies with Probuphine. We believe the study design was robust and will provide a well-controlled evaluation of Probuphine compared with the current standard of care in these stable maintenance patients.

The US market for addiction treatment has continued to grow, with prescriptions for buprenorphine products increasing by more than 12% last year, and there are now three proprietary daily-dose formulations on the market, along with a few generic versions.

Also of note, there are three injectable one-month depot formulations in early- to mid-stage clinical development, which further emphasizes the importance of long-term treatment in this chronic illness. Probuphine with a six-month treatment option has the potential of being the first such product on the market and, if approved, we believe will become an important tool for combating the growing epidemic of opioid addiction.

Now we're also very excited about our ProNeura-ropinirole program for Parkinson's disease. In June, Titan presented nonclinical data at the 19th International Congress of Parkinson's Disease and Movement Disorders, demonstrating the potential of ProNeura in the treatment of Parkinson's.

The dose-escalating study in a Parkinsonian primate model showed that motor function could be significantly improved with no onset of dyskinesias following the continuous non-fluctuating release of the dopamine agonist ropinirole, which is contained in the ProNeura-based subdural implants. We are now in the final stages of testing and are fully characterizing the optimal formulation. During the fourth quarter, we expect to submit to the FDA the pre-IND data package that would support a product development plan.

Our goal is to initiate a clinical proof-of-concept study in late 2016, following the approval of Probuphine.

ProNeura ropinirole for Parkinson's could provide a valuable treatment option for those suffering from this progressive disease. About 1 million people in the US suffer from Parkinson's and that number is expected to double by 2030 due to the aging population, according to the Parkinson's Disease Foundation.

Dopamine agonist therapy, which is the current standard of care, is designed to replace dopamine in the brain in early-stage Parkinson's patients, but it typically stops working efficiently after several years and can trigger serious side effects. In fact, about one-third of treated patients develop motor response fluctuations and/or drug-induced dyskinesias within about three to five years of treatment.

Clinical and nonclinical research suggests that these motor side effects may arise from the pulsatile dopaminergic stimulation resulting from current oral treatment modalities. In clinical studies, dopaminergic stimulation by continuous infusion has been shown to palliate these motor complications and also to delay or prevent the onset of dyskinesia for up to one year in Parkinson's patients.

The ProNeura drug delivery system can offer a simple way of providing around-the-clock stable levels of medication such as a dopamine agonist, like ropinirole, in an outpatient setting and we believe this has the potential to alleviate some of the motor complications and offer another option in treating Parkinson's disease.

We're also evaluating additional compounds used in the chronic treatment of select diseases and we are conducting initial nonclinical pharmacokinetic studies to identify a promising candidate to be added to the product pipeline later this year, and I'll talk more about that at the next conference call.

Now I'll turn the call back to Sunil. Sunil?

Thank you, Kate. This brings us to the end of our formal remarks. And now, Lisa, we are ready to take questions from the call participants.

(Operator Instructions). Scott Henry, ROTH Capital.

Just a couple questions today. For starters, spending levels were down a little in second quarter versus first quarter. How should we think about second half of 2015 on G&A and R&D? Should we just think similar to the second quarter or will there be any filing-related expenses coming into R&D?

I would think it should be pretty similar to this quarter. It might be just a slight uptick. You know, yes, there are some expenses, mostly they will be in the fourth quarter, related to an IND -- you know, pre-IND meeting with the FDA. But the third quarter should be pretty much similar to the second quarter.

Okay, and then shifting gears. You've got the Phase 3 data, the second Phase 3 data on Probuphine, about to file in the US. Any thoughts on what you could do with that asset outside of the US? Is this something you could partner? Just any thoughts on that topic.

That's an excellent question, Scott, and I'll have Kate mention a little more on this as well, but our goal is as we complete the NDA package for the FDA, we intend to take the same integrated information to regulatory agencies outside of here, in specific countries like the UK, France, Australia possibly.

And there has been some interest from companies in these countries in understanding what the regulatory pathway for approval would be so that they can establish certain value for partnering purposes. And that's the process we're following, and Kate?

Just to add to what Sunil said, Scott, we have been exploring timing for discussion with ex-US regulatory authorities, and we hope to initiate those discussions later this year and in first quarter of next year once the NDA has been resubmitted, and we'll update you to further details when we have them.

Okay, great. And I guess that's really all the questions I have for now. Good luck with the filing and we'll look forward to that.

Great. Thanks, Scott. (multiple speakers)

(Operator Instructions). I'll now turn the call back to Sunil Bhonsle.

Thank you, Lisa. Thank you, everyone, for participating in this call.

This was an important quarter for Titan and we look forward to working with Braeburn as Probuphine moves through the regulatory process. As importantly, we are very excited about the development of our other products based on our ProNeura technology and we appreciate your support. Thank you, and speak with you again in another few months.

Ladies and gentlemen, that concludes today's conference call. Thank you for your participation.