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AMAG Pharmaceuticals, Inc. (NASDAQ:AMAG)

Q3 2008 Earnings Call Transcript

November 3, 2008, 4:30 am ET

Executives

Kristen Galfetti – Senior Director, Corporate Communications/IR

David A. Arkowitz – EVP, CFO and Chief Business Officer

Brian Pereira – President and CEO

Analysts

Adam Walsh – Jefferies & Company

Matt Roden – J.P. Morgan

Joseph Schwartz – Leerink Swann

Marshall Urist – Morgan Stanley

Mark Monane – Needham & Co.

Chris Raymond – Robert W. Baird

Carol Werther – Summer Street Research

Soham Pandya – Think Equity

Andrew Berens – Merrill Lynch

Veronica Dubajova [ph] – Goldman Sachs

Operator

Good morning. My name is Christy and I will be your conference operator today. At this time, I would like to welcome everyone to the AMAG Pharmaceutical third quarter financial results call. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be a question-and-answer session. (Operator instructions)

Thank you so much Ms. Galfetti, you may begin your call.

Kristen Galfetti

Thank you, Christy. Good afternoon, I would like to welcome to our third quarter 2008 earnings results conference call. Today we will be discussing our financial results, business highlights and development program. Our call today will reference the press release we issued this afternoon, which is posted on our website at www.amagpharma.com in the Investors Section.

The agenda for our call today will begin with our Chief Financial Officer and Chief Business Officer, David Arkowitz, who would discuss our financial results for the quarter. Next, our President and Chief Executive Officer, Dr. Brian Pereira will follow with a brief discussion of the company’s accomplishments our corporate update and steps that we are taking to become a commercial, biopharmaceutical company. This will be followed by a question-and-answer period.

Before proceeding with this call, please be reminded that any statements we made during the course of this conference call that are other than the historical facts including statements regarding our financial condition, development program, the planned US launch and commercialization of ferumoxytol in the first quarter of 2009, or believes that will not need to conduct any additional clinical trials prior to approval of ferumoxytol.

Statements regarding the size and design of our planned Phase II ferumoxytol imaging study, statements regarding our anticipated side of our sales force the impact of current auction rate securities and liquidity on our operations and business plans, and our intent to initiate addition clinical programs for ferumoxytol our forward-looking statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.

We want to emphasize that these forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those discussed in such forward-looking statements. Such risks and uncertainties include the possibility that we may not be able to adequately address the issues rates and provide the information request by the FDA in the ferumoxytol complete response later and obtain the necessary regulatory approvals in order to market and sell ferumoxytol or we may not obtain such approvals in a timely manner.

The fact that we have limited sales and marketing expertise, uncertainties regarding our ability to successfully compete in the intravenous iron replacement and imaging market, uncertainties regarding our ability to obtain favorable coverage, pricing and reimbursement for ferumoxytol if approved, uncertainties regarding our ability to manufacture, uncertainties relating to our patents and proprietary rights and other risks identified in our Securities and Exchange Commission filings.

Any forward-looking statements that we make today must be considered in light of these factors. The assumptions on which we base any forward-looking statements and our perception of the factors influencing those assumptions are highly likely to change overtime. However, our company policy is to provide forward-looking statements only at certain points in the year, such as during the calls like this one. We do not plan to otherwise update such statements. Actual results may differ materially.

I will now turn the call over to our Chief Financial Officer and Chief Business Officer, David Arkowitz.

David Arkowitz

Thank you, Kristen and good afternoon everyone. Today we reported unaudited, consolidated financial results for the third quarter of 2008. Revenues for the quarter ended September 30, 2008 were $0.3 million as compared to $0.5 million for the same period in 2007.

Total operating costs and expenses for the quarter ended September 30, 2008 were $24.8 million as compared to $11.7 million for the same period in 2007, an increase of $13.1 million. The increase in operating cost and expenses was primarily due to increased research and development expenses to expand the company’s clinical development infrastructure and scale the company’s manufacturing capabilities and increased selling, general, and administrative expenses to prepare for the planned commercialization of ferumoxytol.

As we have consistently stated, we expected that our spending would increase significantly during 2008 as we prepare for commercialization and initiate additional clinical trials for new indications. Our third quarter operating cost and expenses reflect as and as compared to the second quarter of this year are about $5 million higher or an increase of approximately 26%.

We reported a net loss of $23.6 million, $1.39 per basic and diluted share for the quarter ended September 30, 2008 as compared to a net loss of $7 million or $0.42 per basic and diluted share in the same period in 2007. For the nine months ended September 30, 2008 we reported revenues of $1.4 million as compared to $2.2 million for the same period in 2007.

Total operating cost and expenses for the nine-month period ended September 30, 2008 were $57.8 million as compared to $31 million for the same period in 2007. Again the increase in operating costs and expenses was primarily due to increased research and development expenses to expand the company’s clinical development infrastructure and scale up the company’s manufacturing capabilities, as well as increased selling, general and administrative expenses to prepare for the planned commercialization of ferumoxytol.

The net loss for the nine months ended September 30, 2008 was $49.9 million or $2.94 per basic and diluted share, as compared to a net loss of $24.2 million, or $1.57 per basic and diluted share for the same period in 2007. At September 30, 2008 the company’s cash, cash equivalents and investments totaled approximately $241.1 million, which is a decrease of $23 million from our June 30, 2008 balance. Excluding stock option proceeds and unrealized investment gains and loss, our cash burn for the quarter was $20 million.

Our cash burn over the 12-month period ended September 30, 2008 has been approximately $46 million. As we have done in prior quarters and in light of the challenges in U.S. and global financial markets, I would like to provide some additional information regarding our auction rate securities and other investments. First, I just remind everyone that our auction rate securities are only those that our municipal principally student loan backed auction rate securities.

We and other holders have similar auction rate securities have continued to experience auction failures. Our auction rate securities balance as of September 30, 2008 using the par value of these securities was approximately $66.5 million. This is a reduction of about $2.5 million from June 30, 2008 due to redemptions by certain issuers during the third quarter. All of these redemptions were at par value.

We continue to estimate the fair value of our auction rate securities using discounted cash flow analysis and by incorporating assumptions that market participants would use in their estimates for fair value. Therefore, we are recording a temporary impairment relating to our auction rate securities as of September 30, 2008 in the amount of $6 million, an increase of about $1.7 million over the amount that we had recorded at the end of the last quarter.

As a result, our auction rate security balance as of September 30, 2008 is $60.4 million. We continue to receive interest payments on our auction rate securities and more than 90% of these securities are rated AAA by at least one of the major ratings agencies. In addition as result of the recent turmoil in financial markets, we have recognized impairments on certain corporate debt securities during the third quarter.

We have recognized a little bit more than $1 million in temporary impairments across a number of our corporate debt holdings and $1.3 million in other than temporary impairments are Lehman Brothers and AIT debt. With that said, we have a high quality cash and investments portfolio. We have a conservative investment policy and our primary objective, it to preserve capital while maintaining liquidity.

Of our $241 million cash and investments approximately a $115 million, is highly liquid and it’s invested in cash, money market funds, which are mostly U.S. Government Securities and U.S. Treasury and Government agency debt. The rest of our investments are held in corporate debt and auction rate securities. We continue to believe that the current turmoil in the financial markets will not materially impact, excuse me our ability to fund our operations and execute our business plans.

I will now turn the call over to Brian for his comments.

Brian Pereira

Thank you, David. The past few months have been an exciting time for AMAG we announced on October 20, that we have received the Complete Response letter to our New Drug Application from the FDA for ferumoxytol for the treatment of iron deficiency and anemia in all stages of chronic in a disease whether or not undeveloped.

Since receiving the Complete Response letter, they have been working intelligently with our internal and external experts to prepare a comprehensive reply to FDA. The Complete Response letter rate three issues; the first, related to request for certain clinical information, the second was related to observations made during the GCP inspection at one of our Phase III clinical sites; and the third was related to observations noted during the pre-approval inspection of our manufacturing facility.

Our prospective is that these issues are addressable with information we have on hand and we believe that we will be able to resolve these issues expeditiously. Excuse me, based on the strength of our clinical data and the NDA submission, the interactions with the FDA to-date and the belief that we do not need to conduct additional clinical trials prior to approval, we continued to plan for the first quarter of 2009 launch.

However as you know, the FDA’s interpretation could be different from us and we could be wrong. Many of you have asked guidance, as to when we plan to submit our reply to the FDA’s Complete Response letter; over there we have done so already. We planned to update you when the FDA notified us of a new action date as this is the more relevant piece of information to your investors.

We have made great progress on our goal of transitioning to a commercial, biopharmaceutical company with a hiring of nearly the entire ferumoxytol sales force, medical science liaison group and account management team. The planned sales force will include approximately 80 renal sales specialists and managers, who will target over 5,000 nephrologists and hematologists in the U.S. We have hired a team of talented and experienced professionals, who are excited to be part of our launch plans.

During the past quarter, we also initiated a Phase II study for ferumoxytol, for vascular enhanced magnetic resonance imaging or VE-MRI and patients with peripheral arterial disease or PAD. The study will enroll approximately a 100 patients with PAD, who will be randomized into one of three dose cohorts.

Participants will undergo serial imaging with non-contrast magnetic resonance angiography, ferumoxytol, VE-MRI and digital subtraction angiography. As you may remember in August this year, the FDA granted Fast Track designation to ferumoxytol for the development in this litigation. We hope to address this unmet medical needs and also patients with safe imaging agent that facilitates the diagnosis of arterial abnormalities in patients with compromised kidney function.

In addition, we continue to work with agency to finalize our ferumoxytol clinical development program for additional indications including iron deficiency anemia due to abnormal uterine bleeding and iron deficiency anemia due to other causes. We continue to build a body of knowledge in the scientific literature supporting the efficacy and safety profile of ferumoxytol.

In August the Journal of the American Society of Nephrology featured a paper on the first trial of 304 patients with non-dialysis dependent CKD, who are randomly assigned to treatments with either IV ferumoxytol or oral iron. This data had previously been presented a scientific meeting. Last week, the American Journal of Kidney Diseases published the paper on the result of a 750 patients safety study comparing ferumoxytol was saline as placebo, in patients with all stages of chronic kidney disease.

The conclusion supports data previously released that ferumoxytol was well tolerated in iron deficient patients. There are several more presentations and publications planned for the months ahead and we’ll share these with you as they become available. In fact, later this week, we have a strong presence at the American Society of Nephrology annual meeting in the Philadelphia will have a medical (inaudible) and eight abstracts accepted for poster presentation. We will also be sponsoring several symposiums and lectures at the meeting.

As we have discussed in the past the attractiveness of commercializing ferumoxytol’s used in markets outside the U.S. vary greatly and is driven by pricing and reimbursement, patient access to dialysis and the role of iron in local treatment protocols. We continue to evaluate those markets that we consider to be attractive and the best way to enter that. Options may include partnerships, distributorships and collaborations.

Our manufacturing scales up efforts are on track, as we continue building ferumoxytol inventory at our Cambridge Massachusetts manufacturing facility. We are continuing to make progress towards bringing our second source manufacturers online, which would augment our manufacturing capabilities to meet the future demand of the marketplace. In July, we moved our corporate offices to Lexington to accommodate our growing employee base; currently our employee headcount totaled more than 250. As of the case every quarter we are happy to share recent developments with you.

Our progress along with our experienced management team and strong balance sheet provide a firm foundation from which we planned to launch ferumoxytol in the U.S. in the first quarter of 2009 and prepare for clinical studies in the development of additional indications.

We believe that we have a strong pipeline in our product that can provide improved therapies to large and growing markets with significantly unmet needs. We hope to see many of you at the American Society of Nephrology meeting and at upcoming investor conferences and look forward to updating you on our achievements over the next few months.

This completes my prepared comments. We will now turn the call back to the operator who will conduct the question-and-answer-session at the end of this call. Operator?

Question-and-Answer Session

Operator

Thank you. (Operator instructions) Your first question comes from the line of Adam Walsh with Jefferies & Company. Your line is open.

Adam Walsh – Jefferies & Company

Hi, thanks for taking my questions. My first one is Brian can you tell us whether or not you have actually resubmitted the response and what kind of go forward data points will be looking for any kind of update on the status with the FDA.

Brian Pereira

Adam, thank you, for your call. As you know many analyst like yourself and investors have asked us for guidance as to whether we have already have submitted our response or when do we plan to do so, as we said on our previous call shortly after our Complete Response letter that’s not an update that we were planning to provide. Our plan is to provide an update when the FDA notifies us, so when you action date because that is the more relevant piece of information and that’s a more definitive time of mine.

Adam Walsh – Jefferies & Company

Great and just to kind of refresh my memory here after you submit a response to the CR, the FDA has 14 days get back to you and do you mean class 1 or class 2?

Brian Pereira

In general that is correct.

Adam Walsh – Jefferies & Company

Okay, great and then Brian obviously you have the contents of the Complete Response letter and you have shared at least some of the top line information that’s been asked for from the letter. I am just curious to knowing what you know in terms of what’s in the letter? How sure can you be that this is going to be class 1 turnaround given the prediction that you are going to launch in the first quarter of 2009?

Brian Pereira

Well, Adam that’s a fair question. As I said earlier, our perspective that these issues in the Complete Response letter are addressable with the information that we have on-hand and we believe that we will be able to resolve these issues expeditiously. So, based on our plans to launch in the first quarter of ‘09 are proceeding as they were even prior to receiving the Complete Response letter.

Operator

Our next question comes from the line of Matt Roden. Your line is open.

Matt Roden – J.P. Morgan

Hi, thanks for taking the question. First, can you clarify whether you are in actual labeling discussions with the agency before the Complete Response letter and whether or not the clinical data request is related to what those inter-labels are not? And then secondly, the question around the clinical site inspections does that require a clinical violation? Thanks.

Brian Pereira

Adam, with respect to your first question, we have stated in the – sorry Matt. I apologize, Matt with respect to your first question, we were in the typical types of discussions that sponsor has with the agency given the late stage of our review cycle that we were in, prior to receiving the PDUFA date. We have not and do not intent to give guidance on whether or not we are in label negotiations with the agency.

With respect to the GCP issue that the agency has raised, as you know as part of the approval process the FDA conduct GCP inspections at several Phase III sites at the completion of the inspection of one of our Phase III site the FDA noted certain observation. As into the past we are not commenting on the specifics of the interaction, but we believe that we can handle this issue with the agency.

Matt Roden – J.P. Morgan

Okay, thanks a lot.

Operator

Our next question comes from the line of Joseph Schwartz. You line is open.

Joseph Schwartz – Leerink Swann

Hi, thanks. I was wondering, did the FDA actually explicitly say that their concerns could be addressed without additional clinical trails?

Brian Pereira

Joe, the FDA never provide the guidance as to how response that should address the issues that they’re raise in a Complete Response letter. The FDA, as I mentioned had brought up three issues and as far understanding after reviewing it internally and without external experts that we can address all of these issues with the data that we have on hand.

Joseph Schwartz – Leerink Swann

Okay, and what additional interaction have you had with the agency since your Complete Response? And when you build your sales force was that before? How much of that was before or after the Complete Response letter?

Brian Pereira

Want to provide clarity, we have had ongoing discussions with agency before PDUFA date and we continue to have collaborative discussion with the agency since. We had completed significant proportion of the hiring of our sales force prior to the PDUFA date and that plans have continued since after proceeding our Complete Response letter, we continue to finish or to add the finishing touches to our hiring of our sales force and offers to highly qualified dynamic sales personnel continue to go out from the company.

Operator

Our next question comes from the line of the Marshall Urist from Morgan Stanley; your line is open.

Marshall Urist – Morgan Stanley

Yes. Hey guys, good evening. So, specifically on your comment about the request for certain clinical data, any sort of insight or specificity you can give us there and then have you had interactions with the FDA specific to whatever those request, the additional clinical data are and you still have the same confidence in 1Q ’09 launch?

Brian Pereira

Well Marshall, as I said earlier that we have had ongoing collaborative discussion with the agency before our PDUFA date and that pattern has continued since we have received the Complete Response letter. We don’t go into the specific, so what the discussions are, but as I said earlier of thorough evaluation of the labor, as well as discussion with our external experts. We believe that all of it can be answered with the information that we have on hand.

Marshall Urist – Morgan Stanley

And you can give us any insight, I asked to what sort of that even broad strokes the certain clinical data requests relate to you?

Brian Pereira

So, it really doesn’t help to discuss the specifics of these as you know throughout the 10 month process. We have not provide specifics for interactions with the agency, we believe this is proprietary and we believe that the long-term interest of our shareholders are best, so if we address them without discussing them in the public domain.

Operator

Our next question comes from the line of Mark Monane with Needham & Company; your line is open.

Mark Monane – Needham & Co.

Good afternoon, greetings from New York City. In the 8-K that you filed earlier, you suggested that not only you believe the FDA could be answered without conducting any additional clinical trials, but you also said including any clinical trials with respect to repeat those as a ferumoxytol, for long term follow-us of patients receiving ferumoxytol. Do you still believe that to be true on your reflections with the FDA and reviewing their response letter?

Brian Pereira

That is correct, Mark. We did provide additional clarity the 8-K because they have made statements during the day to that effect and that continues to be our belief.

Mark Monane – Needham & Co.

You said here that three issues were raised in the FDA response letter; with there any other issues that were raised? Or was this really the total number?

Brian Pereira

These are the three issues that were raised and that’s why we provide clarity as to what the three issues were?

Operator

Our next question comes from the line of Andrew Berens from Merrill Lynch. Your line is open.

Andrew Berens – Merrill Lynch

Hi, thanks. I just wanted to Brian to get some more information about the GCP issues, is the site where they noted a problem? Is it a major site? And is there any possibility to loose the patients that are at that site?

Brian Pereira

Andy, thank you for your question. As you recall that we have run our clinical trial at close to 200 different sites for our 1500 patients. So, while we don’t comment on whether it was major site. We view every site of ours as an important site.

Andrew Berens – Merrill Lynch

Okay, and then concerning the certain clinical information, can you confirm that it’s just to safety update?

Brian Pereira

We have not provided a color on what the clinical information that was requested Andy, so as a result I am not confirming whether it is or it is not a safety update.

Operator

Our next question comes from the line of Chris Raymond from Robert Baird. Your line is open.

Chris Raymond – Robert W. Baird

Thanks, just wondering you seem to probably would have know these three issues at the time that you got the complete response letter, can you explain why you are providing this little bit of detail now versus when you actually first got the Complete Response letter?

Brian Pereira

Sure. That’s a great question Chris. As you know when we get our Complete Response letter, we have an obligation for a timely disclosure from – of the Complete Response letter from the agency since then we have reviewed the Complete Response letter and internally we have weighed the desire of investors for additional details on the content of the letter against the competitive considerations and we determined that this is the appropriate type to state that we had received three and the level of details that I provided in my prepared comments was the appropriate level of disclosure at this point in time.

Chris Raymond – Robert W. Baird

Okay, that’s fair enough. Can I just follow-up with another question, in you prepared comments I want to make sure I heard him right? I think I thought heard you say that you may have already responded to the FDA, but we won’t know until you hear from the FDA, is that correct?

Brian Pereira

That’s correct. We said that many of you have asked guidance as to when we plan to submit our reply to the FDA’s Complete Response or whether we have already done so and I said that we will not provide additional color on that. The next time we’ll update you as when the FDA notifies us of a new action date and this is the more relevant piece of information and as you know Chris, I mean we really don’t want folk starting a time clock what our investors really would like to know is when is our next action date and that’s the time we’ll provide additional color.

Operator

Our next question comes from the line of Carol Werther with Summer Street Research. Your line is open.

Carol Werther – Summer Street Research

Thank you, so when you know the action date, you are going to tell us that I suppose just the FDA usually wait the whole time period or is it possible you could get an approval before that time periods up?

Brian Pereira

I mean, Carol that and I think you bring up a very important issue. The guidelines that the agency has a broad guideline. The agency is well within its prerogative to respond as soon as it chooses, and there is a fair amount of dispersion around the median in terms of the agency response and that’s why we’re being careful not to guide our analyst and investors.

Carol Werther – Summer Street Research

Okay, thank you.

Operator

Our next question comes from Matt Roden with J.P. Morgan. Your line is open.

Matt Roden – J.P. Morgan

Hi, thanks for taking the follow up. Question on the label expansion trials into AUB and generalized IDA. The start of these trials, is that in anyway contingent on gaining an approval on CKD?

Brian Pereira

Good question Matt, but the answer is no. The AUB and our IDA trials outsides of AUB, preparations for those are ongoing. The only challenge there is you must remember that those protocols are submitted to the same review division in fact the same review team as the one that’s reviewing our current application. So, our expectation is that we will be able to finish our discussions with them regarding our protocols as soon as our FDA application for CKD gets of the track. It’s not our choice, but you know that purely is a logistical issue within the division.

Now, having said that. We could hear from them tomorrow saying that our protocols are fine in which case our clinical operations team is ready to go.

Matt Roden – J.P. Morgan

Understood, thanks a lot.

Operator

Our next question comes from Soham Pandya from Think Equity. Your line is open.

Soham Pandya – Think Equity

Great, thanks for taking my question. Just a one question that I have. Now, that you had a chance to review the Complete Response letter. Do you think a panel or Advisory Committee Meeting is totally out of the question now? Or do you think that’s still a possibility?

Brian Pereira

Well, good question Soham because I think it’s fair to say that our reading of the three issues raised in the Complete Response letter suggest that it’s very unlikely that the agency would want to have a panel.

Soham Pandya – Think Equity

Okay and then just following upon the manufacturing side and you know that always one of the questions that came up in this Complete Response letter, but can you talk about how much inventory have you stocked up already?

Brian Pereira

We have not given detailed guidance as to how much inventory we have stock filed, but as you have said we began commercial inventory production earlier this year. As you know as part of the approval process the FDA conducts, what’s called a pre-approval, a GMP inspection of the drug manufacturing facility and so our original plan was to produce more than 200,000 grams of ferumoxytol by the end of the year and we believe we are on track for that.

Operator

Our next question comes from the line of Marshall Urist with Morgan Stanley. Your line is open.

Marshall Urist – Morgan Stanley

Yes, thanks for the follow-up guys. I just wanted to follow-up on the GCP issue. Can you give us a sense of how many sites are, even broadly speaking, how many sites the FDA inspected and are you confident that they are not going to need to go back and do sort of a more extensive review, which we’ve seen in other cases?

Brian Pereira

That’s a good question Marshall. We haven’t given color as to how many sites, but as you know the FDA audits reasonable number of sites and if that our observations at a given sites the FDA communicate that to the sponsor. If the response of the sponsor is not convincing the FDA always reserved the right to go back and audit more sites.

Marshall Urist – Morgan Stanley

So, you don’t have or you can’t give us clarity on that issue right now?

Brian Pereira

As I said earlier that our perspective has been that all three issues which include the GCP issues are addressable with the information that we have on hand.

Operator

(Operator instructions) Our next question comes from Mark Monane with Needham & Company. Your line is open.

Mark Monane – Needham & Company

Thank you very much for the follow-up question. Brain, can you go over the targets that will be the goals for AD representatives that you have hired, and which population will you focus on first and what level of penetration or how you’ll measure your success in the first year?

Brian Pereira

Well, Mark let me take you have asked a large number of questions, let me take them piece-by-piece. Our broad challenge, our broad intend is to capture share in the dialysis market and to build treatment of anemic patients with ferumoxytol in non-dialysis CKD patients. Given that we have hired, as I said early approximately, AD high quality of sales personnel. They come from the absolute blue blooded commercial pharmaceutical companies.

Almost all of them have nephrology experience. Almost all of them have injectable experience in nephrology, and almost all of them have long standing relationship with both the dialysis clinic and the large nephrology practice groups.

The issue of how we incentive wise them is first, a question that wouldn’t be fair to be discussed in the public domain, and second as you must remember, that there is no one side quick solve there are several issues including the pace and the spread of the territory, the mix of dialysis versus physician practices in the given locale and so on. Surprise to say that we have an extraordinary sales management team in place; who has put very, very good objectives in front of our sales force and they will clearly be incentive wise to deliver the best results to us and to you our shareholders…

Mark Monane – Needham & Company

Thank you.

Operator

Our next question comes from the line of Joseph Schwartz with Leerink Swann. Your line is open.

Joseph Schwartz – Leerink Swann

Hi, thanks again. I was wondering if you could go over the data that you’re going to be in the other events that you will be hoisting at the ASN, which should we expect that is new?

Brian Pereira

Well Joe, that is a good question, we have a total of eight posters at the ASN, three are on Thursday, one is on Friday and the remaining four are on Saturday, that’s a total of eight AMAG sponsored posters. In addition that at a large number of our symposium, invited lectures and others where in AMAG slides are like to be presented and finally, it is an AMAG specific symposia of which is also on day (inaudible). So you will see a pretty large footprint of AMAG at this American Society of Nephrology Meeting.

Joseph Schwartz – Leerink Swann

So, is as any of this information new, or what also you are hoping to get out of the meeting?

Brian Pereira

Well that’s a good question. All of the analyses that we are going to present are new, because by virtue of the fact that they are being accepted for presentation requires them to be new. The pivotal safety and efficacy results has been provided at meetings of prior – in the past as well as in publication that’s are coming out, but these are new and interesting analyses, because our intend is to built for the future.

The guidelines for anemia management have largely been focused on a large body of knowledge on ESA. The body of knowledge on iron has been relatively weak and what our clinical development and medical affairs team is attempting to do at this day since is to start enhancing the body of information that’s available, so that moving forward, as clinical practices emerge and clinical practice guidelines are develop, the ferumoxytol data becomes the basis on which new guideline will be developed, which will ultimately lead to a significant expansion in the number of people who are treated with iron hopefully ferumoxytol and the dosing of patients with iron particularly ferumoxytol.

So, you will see a fair amount of very interesting additional data, which will be moving the ball fairly up-field in our understanding of how to manage iron deficiency in CKD patients.

Operator

Our next question comes from the line of Andrew Berens with Merrill Lynch. Your line is open.

Andrew Berens – Merrill Lynch

Hi, thanks for the follow-up. Brian, just I wanted to get an idea, on how important is the March 31, date for J-code and what, if you don’t get approved by March 31, what does that do for your plans as far as billing?

Brian Pereira

Well Andrew, I’m glad to bring that question on, because remember a drug does not have to be launched with the permanent J-code, drug needs can be launched with a miscellaneous J-code and different permutations of Q and other codes. So, the key here is, for customers who send out a bill when they use ferumoxytol to get paid and once they get paid that drives up the confidence that all subsequent bills will be paid and that’s pretty much the standard weighing in which, injectables are launched. The March 31, our deadline is for a permanent J-code. A permanent J-code is the nice to have, but the absence of that is not particularly punitive. Having said that, our plan is to launch by in the first quarter of 2009.

Andrew Berens – Merrill Lynch

Does the J-codes not only a permanent one, this is possibly lead to more hurdles to reimbursement for the providers?

Brian Pereira

Not necessarily, because we have a fairly experienced accounts management and government affairs team, who are – is fully equipped to hold the hands of dialysis chains and large Nephrology Practice Groups through any reimbursement challenges that they could face.

Operator

Our next question comes from Carol Werther from Summer Street Research; your line is opened. Ms. Werther, your line is opened.

David Arkowitz

I think we lost Ms. Werther?

Operator

(Operator instructions) Our next question comes from the line of Veronica Dubajova [ph] from Goldman Sachs; your line is open.

Veronica Dubajova – Goldman Sachs

Thanks for taking my question. Could you discuss specifically your new marketing strategy in the dialysis segment and we’ve seen this market and what’s that you’ve indicate that patients switch over from one product to another is quite difficult. So, I was wondering if you could comment on what kind of strategy we have in this segment? Thank you.

Brian Pereira

Sure, thanks Veronica. The strategy in this segment is two-fold. One is to develop a strong contracting relationship with the dialysis chain that ensures that the product is available to all patients that all of that dialysis centers within the given dialysis chain and concurrently to create a full by explaining or detailing nephrologists with respect to the clinical profile of ferumoxytol.

Built within that is demonstration to the dialysis nurses in the dialysis unit above the logistical advantages that ferumoxytol brings to the dialysis unit wherein time can be more appropriate to more effective patient care rather than giving infusions of the existing IV irons. This both have pull and a push mechanism and our contracting team and our marketing team have developed a robust strategy to deal with this in both the large, medium and small dialysis chain.

Veronica Dubajova – Goldman Sachs

Great, thank you very much.

Operator

And our next question comes from the line of Carol Werther with Summer Street Research; your line is open.

Carol Werther – Summer Street Research

Can you here me now?

Brian Pereira

Absolutely.

Carol Werther – Summer Street Research

Okay. I just want to follow-up on that, so after you launch should we be looking for you to sign a deals with DaVita and how important is that for Fresenius a deal on Vinofer? Thanks.

Brian Pereira

Well, good question, Carol. First is I must say, you don’t have to sign a deal with any dialysis chain. With dialysis chain you provide a contract, a dialysis chain may or may not have contracts with multiple sources and at the end of the day, if ferumoxytol as we believe has a outstanding clinical profile then the docs will want to use it and if the contract is attractive to dialysis chain, the dialysis chain will create an environment wherein we can ensure a rapid and I would say at rapid adoption and a large market share and again that’s true for all dialysis chain including Fresenius because at the end of the day Fresenius will make our ferumoxytol available to it stock and it’s our responsibility to convince the physicians within Fresenius dialysis centers, who we all know that ferumoxytol is the ideal choice for their patients and we believe that the doctors will make decisions based on what is in the best interest of their patients.

Operator

We have no further question at this time.

Brian Pereira

Well, thank you very much for joining us on the call and we look forward to keeping you updated on development as they evolve. Have a good evening.

Operator

Thank you so much. This concludes our conference call for today. You may now disconnect you lines.

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Source: AMAG Pharmaceuticals, Inc. Q3 2008 Earnings Call Transcript

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