Idenix Pharmaceuticals CEO Presents at 31st Annual JPMorgan Healthcare Conference (Transcript)

| About: Idenix Pharmaceuticals, (IDIX)

Idenix Pharmaceuticals, Inc. (NASDAQ:IDIX)

31st Annual JPMorgan Global Healthcare Conference

January 9, 2013; 05:00 p.m. ET


Ron Renaud - President & Chief Executive Officer


Geoff Meacham - JP Morgan

Geoff Meacham

Good afternoon and welcome to the 31st Annual JPMorgan Healthcare Conference. This is day three, almost there yet. My name is Geoff Meacham. I’m the Biotech Analyst here. Its my please to introduce Idenix Pharmaceuticals, an emerging leader in the Hepatitis C space and speaking on behalf of Idenix is President and CEO, Ron Renaud.

Ron Renaud

Thanks Geoff. Before I began the obligatory Safe Harbor statement, we are going to be making forward-looking statements subject to risks and uncertainties and you can find the details, all this in our SEC filings.

So for some of you who don’t know Idenix, we are primary focused on Hepatitis C. We have in the past been involved in HIV and in Hepatitis B. In fact we developed a compound with partner Novartis that we successfully developed through to commercialization. They actually sell that product in the market now in over 60 countries, but what we do now is focus exclusively on Hepatitis C.

Our pipeline is here. You can see that it is primary filled with nucleoside, nucleotide inhibitors. We have one NS5A inhibitor IDX719 and really the overview here is we are focused on development of next generation oral antiviral combination treatments for HCV.

The lead compound currently is IDX719. This is an HCV NS5A inhibitor, which we successfully completed three day proof-of-concept studies across four genotypes in 2012, and we expect to initiate an all oral Phase II combination trail sometime during the first half of this year.

We also have a very robust HCV nucleotide inhibitor program and I think you will hear us spend a fair amount of time talking about this, because this is really what Idenix has been based on, this is what the company was founded on. Our nucleoside and nucleotide prodrug expertise and that will be lead by a next generation uridine nucleotide analog that we plan on filing an IND on later in this half of 2013.

I’ll also spend a little bit of time talking about our previous lead assets IDX184 and IDX19368 which were put on clinical hold by the FDA last year and again, we continue to make big strides in our discovery efforts for new Novel Nucleotides prodrugs.

Just a little bit as I mentioned. We had a relationship with Novartis. This was a relationship that dates back to May of 2013. We successfully renegotiated that agreement in 2012. They previously had rights to any compound that came out of our pipeline. Those rights have now virtually vanished.

We have some non-exclusive rights or they have some non-exclusive rights to work with their compounds and our compounds in HCV, but other than that most of the governance rights have gone, and so what we believe is we are in well position, we are in a good position this year to bring multiple paths forward to evaluative all oral combination HCV regiments.

So let me take a couple of minutes, because I think its important to point out what the HCV market place potentially looks like. I think there is a lot of discussion out there, since HCV is curative, whether or not the next regiment that comes forward, the next regiment that comes forward is going to take up all the patients in the industrialized world.

We often hear that this is a two to three market and that’s it. We couldn’t disagree more and in fact if you think about the dynamics of the HCV market place, there is a lot more going on than I think what meets the eye. Roughly 3% of the worlds population is infected with HCV and a small, small percentage of that actually know they have it. Of the 170 million infected, 11 million of them reside in developed countries.

I think its important to point out here that most of the development that’s ongoing today, most of the HCV development that’s ongoing today is primarily focused at Genotype 1 and Genotype 1 really in the grand global marketplace represents roughly half of the role wide HCV infected market. So its important that we focus on Genotype 1, but at Idenix we also believe that its going to be important to have a regiment that addresses Genotypes 1, 2, 3 and 4 and even 5, 6.

So we’ve done a little bit of work over the last six to eight months to try to really understand what the opportunity is in the U.S., in the E.U. and Japan and I think what’s interesting on this slide is just sheerly looking at the number of patients here as this rises up, based on CDC guidelines that we think are forthcoming.

Right now there’s probably about 100,000 patients that are actually treated in the United States for HCV and this is where the regiment that contains Pegylated Interferon and Ribavirin.

The CDC is proposing birth cohort screening, which means that patients or people born between the years of 1945 and 1965 be screened for HCV, and we estimate about 1.7% of the U.S. population is infected with HCV. At the last census in 2010 there were roughly 100 million people in that birth cohort. So you can see right there, we have estimates here, peak and this is again, this is the U.S., E.U. and Japan, but even with that it peaks at about 296,000 in early 21.

In the U.S. alone that patient number could represent upwards of 2 million people, and so its going to take a lot of work to find those people, to get them diagnosed and to get them treated and this is not going to happen overnight. This is going to take more time than the 14, 15, 16 timeframe. So that’s why we believe there’s still a significant opportunity for new players to come into the HCV space.

And if you think its difficult to try to find these patients in the United States, wait till we go out of the Untied States or the E.U. and Japan. When we go into some of these other developing countries, the HCV prevalence is much higher, much, much higher and its going to be much more difficult to find those patients.

But if we think about the cost savings and the economic value added by finding those patients, because roughly 75% of these patients if they go undiagnosed or untreated, will ultimately advance to some advanced stage of liver disease, which could include hepatocellular carcinoma or cancer. So the cost savings to addressing these patients earlier and curing their HCV far out way is what comes after that and that’s where we see a significant market opportunity.

And so as I mentioned, if we look at what the current approach is right now, obviously we want regiments that are potent, that are safe that are convenient. I think with the nucleosides you get a high barrier to resist, but again still primarily focused on Genotype 1 and treatment in naïve patients.

We think the opportunity that’s in front of us for Idenix lies in future DA combination opportunities. We want to have drugs that allow us to form regiments that are pan-genotypic, so that we can addressee easily the global market place, no responders, so these are patients who have not done well with previous therapies, advanced fibrotic patients, so these are the patients that the disease has progressed a little bit future and have fibrotic livers, pre-transplant patients, Cirrhotic patients.

We now have protease inhibitors on the market and we have patients that have failed those therapies and we also have patients that are co-infected with HIV and again, I discussed the emerging markets.

So how we are going to do it? This is the plan for what we have right now. This is led by IDX719. This is our NS5A inhibitor. We’ve been working through our talks and manufacturing and are getting ourselves ready to hopefully begin a study with another direct acting antiviral. Our intention is to start an all-oral combination study with 719 here is the first half of this year. So I’ll take a little bit more about that.

Our uridine nuc, this is a next generation uridine nucleotide prodrug. Each of these nucleoside or nucleotide prodrugs have different basis. 184 and 368 were guanfacine bases. These uridine nucs or obviously uridines, and then we are also going to be focused as we go towards the latter half of this year on developing a NUC-NUC strategy. So developing these nucleotide prodrugs with overlapping resistance profiles that could potentially give us a very small convenient pan-genetic approach to treat this disease and could end up being a real game changer in the treatment of HCV.

So a brief updated. As I had mentioned IDX184 and IDX368 are on clinical hold, these compounds went on clinical hold in late last summer as a result of toxicity, cardiac toxicity noticed with one of the Bristol Myers nucleotide prodrugs, and reason for the somewhat collateral damage on that for us was that the compounds share the same activity metabolite, which is 2’-methyl G.

We went back and we looked at all the patients that have received IDX184 and on the study that we had ongoing at the time. We didn’t see any evidence of clinical cardio toxicity or renal toxicity with IDX184 on anything that you would see was PegIFN/RBV alone.

So we pulled all that information. We went back, we looked at a series of cardiac markers. We went back and did echocardiograms on all of our patients and in early December we submitted a complete response to the FDA. We did hear back from the FDA last week. It was a very, very brief conversation. In that they had needed more time to evaluate the response and we expect to hear more from the agency before the end of this quarter.

So a little bit about our NS5A inhibitor, IDX719. We’ve been excited about this compound for quite some time. Before we even got into the clinic, we liked what we saw. We believed at the outset that it had potent pan-genotypic activity, given what we saw in the replicon model, 2-24 pM across the Genotypes, and NS5As in general seem to present themselves with a very low potential for drug-drug interactions.

We filed an IND in January of last year and completed a three day proof-of-concept study in 64 ACV infected patients and what we did with that study, most of the proof-of-concept studies are focused on Genotype 1. We actually went out and did the proof-of-concept study in Genotypes 1, 2, 3 and 4 and I have a little bit more in the data in the next slide.

We are also working on three month toxicology and solid-dose formulation work, which will support our phase III trials to get underway this year and again as I mentioned, a 12 week phase through all oral combination, clinical trails expected to begin in the first half.

This is the data from the proof-of-concept study and we’ve broken out Genotypes 1A and 1B here, and as you can see here very impressive antiviral reductions across the four Genotypes. Noticeably in the Genotypes 2 patient population you see its not quite the same as what it is with the ones and threes and fours.

We have about half of the patients in that when they present with a preexisting mutation, they have no response to the drug or for the patients that where that mutation does not exist. They have roughly a four log reduction and viral load. So we can easily screen for that and we also believe that going forward in the context of combination approach, we have a very potent nucleoside or nucleotide prodrug or other combinations that won’t be an issue at all.

And so what makes 719 attractive, we believe is the fact that while many claim to have a pan-genotypic NS5A, we’ve actually done the proof-of-concept work and seeing the activity across the four Genotypes, That’s not to say we won’t see NS5A inhibitors that are pan-genotypic. All I’m saying here on this slide is that we’ve actually done the work and been able to demonstrate that.

So we think this makes for a very attractive combinable compound as we think about a pan-genotypic approach. We’ve seen data from competitors looking at nucs and NS5A and right now they appear to be a very, very attractive regiment to go after HCV and I think having one that actually has true pan-genotypic activity makes this very attractive.

So now shifting over to our nucleotide prodrug discovery program. This is an area as I mentioned that Idenix has been founded on. This is really where our core competency lies. As I mentioned, we’ve done this in HPV and we’ve been working on this in HCV for quite some time. But I think we’ve really doubled down our efforts within the last two years.

About 2, 2.5 years ago we began to really focus on what makes for a good nucleotide prodrug and the basic structures of these, you have the pr-drug component, you have the sugar component and you have the nucleoside itself, the base. And what we wanted to try to understand was, what can you do to each of those three components to make for the best nucleotide prodrug and we went and we looked at dozens and dozens of it, if not 100s of prodrugs, we looked at tweaks on the sugars and on the bases and we identified many promising compounds and I have a slide here that shows you exactly what we did, but we try to identify promising compounds by looking at triphosphate production, kinetics of metabolism and we also with cytotoxicity want to get an early look at safety.

And really what we are trying to do is not come up with something that was as good as what we were already working on. We were trying to come up with something better than the best thing that’s out there and we think we have a couple of candidates that fit that criteria, and in fact for that reason we are going to file INDs in 2013 for the uridine analogs and we are going to peruse a NUC-NUC strategy toward the end of this year.

I also mentioned that getting Novartis somewhat out of the picture with regard to their rights for our pipeline was important for us not only in the HCV front to go out and potentially partner those compounds, but we can also start to now look at our nucleoside, nucleotide library for potential uses in non-HCV therapeutic areas. So while we were dealing with the clinical hold issue last summer, we had right before that had announced the termination agreement with Novartis.

In very short order we had other third parties, other companies contacting us about screening the library, now knowing that they might be able to find something in the nucleoside library that we wouldn’t have otherwise looked for. So we continue to entertain that interest, our focus is right now 100% on getting HCV right at this time, but that’s not to say that sometime in the future we won’t start to take a harder look at what might be in the library to go beyond HCV.

So what we did exactly was look at over 280, close to 300 different nucleoside analogs, over 30 different prodrug types. That means we synthesized well over 2,000 nucleotide prodrugs over the last two years. And in the course of doing that we separated close to a 1000 of them into the Diastereomers and the bottom line on this one is we’ve got about 15 prodrugs that we took to monkey studies.

So if you think about just probably the hurdle we’ve had to set for ourselves, we are going to file potentially tree INDs here in the next 12 months to 18 months. We really went through and laboriously looked at what makes for the best nucleotide prodrugs. So I think the result of all of this work over the last two years means that the best drugs that Idenix has ever developed are going to go into the clinic this year.

And an example of that is, as I mentioned we are looking at monkey and mouse liver trisphosphate and I think for the non-scientist in the audience, the liver trisphosphate is really what kills the virus. The drug has to get converted to trisphosphate in the liver. That trisphosphate is what knocks the virus down and what we were trying to do is get as much trisphosphate generated in the liver, as low of an exposure and low of a doses as possible. This compares to some of the things that are out there, even our own IDX184.

IDX19368, which is our guanosine analog that’s on clinical hold, you can see why we were very, very excited about that. We continue to be very excited about that, because of the impressive liver trisphosphate level. But the Novel NUC, the NUC that we plan on putting into the clinical later this year, this is the one that we are very, very excited about. We believe that this one has the potential to be a very, very important backbone of any curative regiment for HCV.

So off of the discovery and development efforts and just a little bit about the pattern interference case that we have right now with Gilead. This was an interference that was declared in February of last year between an application that we have and a Gilead issued pattern. The PTO brought this interference forward.

There are two phases to it. There’s a first phase, which is basically who gets to be the senior party, who is the first to file the intellectual property and then the second phase and this is very simplistic. My general council would give you a lot more details around this, but the second phase is then to determine who is the first to invent, and we expect to have some type of resolution to the first phase of this before the end of this quarter and then by the end of this year conclusion to the emotions and other filings with regard to the second phase. So this will take at least another year in our estimate to be fully wrapped up and at the end of it regardless of who wins or who looses, this is all appeal able to the federal court.

Just some housekeeping; we finished 2012 with just under $231 million. This means our balance sheet is still quite strong. In fact this is probably one of the strongest balance sheets we’ve had with the number of projects and the numbers of things that we have in front of us. This cash balance will allow us to turn over all the cards that I just laid out and hopefully all the value creating opportunities in HCV that we are planning over the next 12 months.

So to summarize, IDX719 combination studies as I mentioned, initiate the 12 week phase II all-oral combination studies and then also get that into combination with our own uridine nucleotide prodrugs by the end of this year. For the nucs, we need to hear back for the FDA before we make any decisions on IDX184 and IDX19368.

That being said, that’s off to the side. Its not a gating factor by any stretch for what we are doing with the uridine nucleotides and so we are still fully planning on moving forward with our 7-day proof-of-concept study for the uridine nucleotide in the first half of this year and then to again to get that combined with 719 and then IND enabling studies for additional nucleotide prodrugs before the end of this year and then I just mentioned about the pattern interference.

So with that, thank you for your time.

Question-and-Answer Session

[No Q&A session for this event].

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