Brenna Mullen - IR
Keith Katkin - President and CEO
Christine Ocampo - VP of Finance
Randall Kaye - CMO
AVANIR Pharmaceuticals (AVNR) F3Q10 (Qtr End 06/30/10) Earnings Call August 5, 2010 11:00 AM ET
Good morning, my name is [Whitney]. And I will be your conference operator today. At this time, I would like to welcome everyone to the AVANIR Pharmaceuticals Fiscal 2010 Third Quarter Conference Call. All lines have been placed on mute to prevent any background noise.
After the speakers' remarks, there will be a question and answer session. (Operator Instructions). Thank you Ms. Mullen, you may begin your conference.
Thank you and good morning everyone. Joining me on today's conference call is Keith Katkin, President and Chief Executive Officer, Christine Ocampo, Vice President of Finance and Dr. Randall Kaye, Chief Medical Officer.
I will begin the call by addressing our forward-looking statements. Following this, I'll turn the call over to Keith Katkin.
As a reminder, the statements made on this call represent our judgment as of today, August 5, 2010. Our remarks and responses to questions during this conference call may constitute forward-looking statements, including plans, expectations and financial projection, all of which involve certain assumptions, risks and uncertainties that are beyond our control and could cause actual results to differ materially from the expected results expressed in our forward-looking statements.
These forward-looking statements include among others, statements about our expectations about the likelihood of success and obtaining FDA approval for AVP-923 and subsequent launch timing, as well as statements regarding anticipated expenditure levels and future cash balances.
We encourage you to take the time to review our recent filings with the Securities and Exchange Commission, which present these matters in more detail as well as related risk factors. AVANIR disclaims any intent to update any forward-looking statements made during this call.
Now, I will turn over the call to Keith Katkin.
Thank you, Brenna and good morning everyone. Thank you for joining us on our fiscal 2010 third quarter earnings call. I'll start today's call by providing a brief update on our overall business before turning the call over to Christine Ocampo who will review our financial results followed by Dr. Randall Kaye, who will provide a clinical and regulatory update for our investigational drug AVP-923 formally known as Zenvia.
Before I begin my comments, I want to let everyone know that we will now be referring to Zenvia as AVP-923 until such time that we receive FDA approval. The FDA recently informed us, that our proposed trade name Zenvia, was not accepted by the agency due to promotional reasons.
This is a common occurrence within the pharmaceutical industry that we were [prepared] for and as such we immediately submitted additional brand names to the FDA for consideration. We do not expect for the review of a new proposed trade name to affect the anticipated approval or the launch timelines.
Now, I'd like to move on to the third fiscal quarter business update. Earlier in third fiscal quarter of 2010, we achieved an extremely important milestone for AVANIR with submission of our complete response to the October 2006, NDA approvable letter for AVP-923 for the treatment of pseudobulbar affect or PBA.
14 days after submission, the FDA acknowledged receipt of our complete response until an action date of October 30, 2010. We continue to believe that we have provided the agency with all of the information they need to access the benefit risk profile of AVP-923 in-patience with PBA.
Dr. Kaye will provide an update on the overall regulatory review process in his comments. With the review timeline set, we have accelerated our market development activities in order to prepare for a successful launch of AVP-923 for into our first calendar quarter of 2011.
We have made excellent progress in building up our commercial team with several key hires in leadership roles including the previously announced hiring of Michael McFadden as our Vice President of Sales and Manage Markets. In addition, we have filled several other leadership positions in the Sales and Manage Markets.
We have also started the process of recruiting our specialty sales force to identify top talent to ensure quick on boarding to meet our launch timelines. Our current plan is to expand contingent offers to 75 sales representatives and seven regional sales managers throughout the United States by the October 30, 2010 action date.
This AVP-923 is approved by the action date, we plan to immediately hire the 75 sales representatives and initiate sales training activities to help ensure a successful launch of AVP-923 in the first calendar quarter of 2011.
During the last quarter, we also continued to conduct market research and advisory board meetings. One of the key areas of research was pricing and managed care coverage to access the optimal price to balance product access with maximizing revenues. We currently expected AVP-923 will be priced between $3000 and $5000 a year and we will continue to evaluate pricing as more research data becomes available.
In addition to building our commercial team, we also continue to focus on raising awareness of PBA among our target position and patient audiences. We have strengthened our medical affairs organization by hiring additional Medical Science Liaisons to interact with key opinion leaders in Neurology and Psychiatry and that had a significant presence at recent medical meetings with a boost focused on PBA education.
We have also conducted medical advisory board meetings with leading physicians in ALS, MS, stroke, traumatic brain injury and other neurology conditions associated with PBA. We continue to receive positive feedback on AVP-923 and the need for an FDA approved treatment for PBA.
In addition, we have also partnered with important patient and with the organization in ALS, MS, stroke and traumatic brain injury to educate the constituencies about PBA. They have all shared with us that PBA is a debilitating condition in the constituencies and are looking forward to working with AVANIR to increase the awareness of PBA.
In third fiscal quarter, we strengthened our balance sheet with a public offering of our common stock. The net proceeds from these offerings were approximately $26.6 million and we will provide funding to support the acceleration of activities to the planned launch of AVP-923 if approved by the FDA.
We were pleased with the favorable terms of the financing especially given the difficult and powerful market conditions at that time. Another benefit of the financing has been the additional well-known, institutional loan-only fund as investors in our stock.
Our momentum in the financial community was evidence by four additional sell-side analysts picking up research coverage during this subsequent to the third quarter. We continue to see increased interest in the company from both buy-side and sell-side analyst.
In summary, 2010 to-date has been a year of significant accomplishment. With the action date set, a strengthened balance sheet and the continued acceleration of commercial readiness initiative, we believe we are well positioned if we receive a favorable approval decision from the FDA and we'll be ready to launch AVP-923 in the first calendar quarter of 2011.
We are now approximately three months away from our FDA action date and it is very exciting to be so close to potentially making an important new therapy available to the significant number of patients in the US that currently suffer from PBA. With that, I'll now turn the call to Christine Ocampo who will review our financial results. Christine?
Thanks, Keith and good morning, everyone. My comments today will cover our financial results for the third quarter of fiscal 2010 and the first nine months of fiscal 2010, as well as our expected cash burn for the fiscal year.
In addition to the financial results summarized in the press release we issued earlier this morning, you can find additional information in our 2009 Annual Report on Form 10-K, and our most recent Form 10-Q. I will begin with a discussion of our results for the third quarter and all announce discussed are approximate.
Total net revenues were $487,000 for the third quarter of fiscal 2010, as compared to $591,000 in the same period of the prior year. Third quarter fiscal 2010 revenue consisted primarily of the recognition of deferred revenue.
The decrease in revenues of $104,000 is primarily attributed to a decrease in deferred licensing revenue of $171,000 related to foreign (inaudible) license agreement that was terminated in fiscal 2009.
Total operating expenses for the third quarter of fiscal 2010 were $6.5 million compared to $5.6 million in the same period of the prior year. Third quarter fiscal 2010 operating expenses consisted of research and development expenses of $2.8 million, compared to $3.4 million in the same quarter in the prior year, and general and administrative expenses of $3.7 million, compared to $2.2 million in the same quarter in the prior year.
Cash used in operations for the third quarter was $5.5 million. Research and development expenses in the third quarter of 2010 consisted primarily of costs related to the complete response to the approvable letter and other regulatory activities. The increase in general and administrative expenses is primarily attributed to our related to commercial readiness activities.
The net loss for the third quarter of fiscal 2010 was $5.7 million or $0.06 per share, compared to a net loss of $5 million or $0.06 per share for the same period a year ago.
Now moving on to our results for the first nine months of 2010, total net revenues were $3 million for the first nine months of fiscal 2010, as compared to $3.2 million in the same period over the prior year.
Revenues consisted of the recognition of deferred revenue of $1.6 million, royalty revenue earned from our license agreement with GlaxoSmithKline for sales of Abreva in the amount of $886,000 and royalty revenue generated from our license agreement with Azur Pharma in the amount of $516,000.
Total operating expenses for the first nine months of fiscal 2010 were $20.3 million, compared to $18.4 million in the same period of the prior year. Operating expenses consisted of research and development expenses of $10.1 million, compared to $11.7 million in the same period in the prior year. And general and administrative expenses of $10.2 million, compared to $6.7 million in the same period in the prior year.
Cash used in operations for the first nine months of fiscal 2010 was $16.6 million. The decrease in research and development expenses is primarily attributed to a decrease in clinical trial expenses, as the Phase III STAR trial was completed in the fourth quarter of fiscal 2009, offset by increased regulatory expenses. The increase in general and administrative expenses is primarily attributed to cost related to commercial readiness activities.
The net loss for the first nine months of fiscal 2010 was $17 million or $0.20 per share, compared to a net loss of $15 million or $0.19 per share for the same period a year ago. As of June 30, 2010; we had total cash of $41.7 million. As previously announced, with the successful financing during the last quarter, we are accelerating our commercial and medical affairs readiness activities.
As such, we expect cash used in operations were the fourth fiscal quarter to be between $7 million and $9 million, of which $3.8 million will be primarily related to commercial readiness activities. We expect cash used in operations in fiscal 2010 to be between $24 million and $26 million.
We plan to discuss our anticipated operating cash burn for fiscal 2011 on our fourth quarter and year end conference call. We expect that our current cash on hand will be adequate to fund continuing operations, the regulatory activities of AVP-923 through the anticipated FDA approval decision date on our PBA application and the initial cost of our commercial launch in calendar 2011.
Now I will turn the call over to Dr. Randall Kaye who will provide an update on the progress of our clinical program.
Thanks, Christine and good morning everyone. 2010 has represented a combination of years of dedicated and focused efforts by the AVANIR clinical team, with a submission and acceptance of the complete response to the approvable letter.
Within established action date of October 30, 2010; we believe that the complete response addresses the remaining concerns raised in the approvable letter thus allowing the FDA to make a determination of the benefit risk profile of AVP-923.
My comments today will provide additional insight into the regulatory process as well as summarize our recent achievements and the next steps for the clinical and medical affairs teams. The complete response was a comprehensive and thorough submission containing substantially more data than our original new drug application submission of 2006.
The complete response submission features an extensive data package designed to address concerns expressed in the approvable letter which includes the final study report from the STAR trial, cardiovascular and respiratory safety white papers and integrated safety database encompassing the entire AVP-923 clinical development program.
The proposed package insert and a proposed risk evaluation and mitigation or REMS program. With the complete response accepted, our team is focused on the regulatory review process to ensure that we are responsive to any questions the FDA might have.
We also continue to prepare for the possibility of an FDA advisory committee. While, we are not going to go into detail on the communications we have had with the FDA. I can tell you that the dialog has been active; we continue to communicate with the FDA and make sure that all request or questions are answered thoroughly and promptly.
With the action date fast approaching, we continue to build our medical affairs organization to assist with our efforts of educating healthcare professionals about PBA. We now have a team of Medical Science Liaisons or MSLs that are tasked with interacting with key national and regional opinion leaders in Neuroscience.
And MSLs are also responsible for supporting our presence at key scientific meetings, with the goal of raising PBA disease state awareness. Lastly, we are very pleased that data from the STAR trial was accepted for presentation at recent medical meetings, sponsored by prestigious organizations such as the American Neurological Association, the American Academy of Neurology and the American Psychiatric Association.
This continued interest in the STAR trial data amongst the medical community is indicative of the importance of the data and the degree of the unmet medical need among patients suffering from PBA. This [cheater] has been a time of significant accomplishment for our company.
We are optimistic that the compete response addresses the remaining issues raised in the FDA's approval letter and service the basis for a favorable approval decision by FDA. There is significant number of patients in the US currently untreated and suffering from sudden and disruptive episodes of PBA.
We hope to provide patients with a therapeutic option as safely and as quickly as possible. Thanks for you time and attention and I'd like to turn the call back over to Keith.
Thanks Randall. In closing, we are pleased with the significant progress made, excited about the upcoming action date and look forward for the potential launch of AVP-923 in the first calendar quarter of 2011 if approved by the FDA. Operator, I would now like to open the call up for questions.
Thank you operator, we are waiting for our first question, I would like to remind everyone that we will be presenting at the Canaccord Annual Growth Conference on August 10 at 5.00 pm, Eastern. The presentation will be available via webcast on our website. Operator, are there any questions at this time?
Yes, your first question that comes from the line of Ritu Baral.
Can you review for us how many clinicians you plan on targeting with the planned 75 person sale force and what the profile of these target physicians will be and also, can you tell us what percentage of these 75 slots have conditional offers out?
Sure, so first in terms of our plan target universal physicians, we are going to start by giving each sales representative a list of approximately 200 physicians for an initial call-down universe of about 15,000 doctors. And the way that we developed that target list of doctors is using underlying prescription data for each of the neurology conditions for which PBA is associated.
So for example, to target MS doctors, we look at products such as Avonex or (inaudible) or Betaseron. If you are thinking about targeting stroke patients, Plavix and so on and so forth. And by using those surrogates, we are able to, we believe; figure out which physicians are seeing the most patients that have the underlying neurology conditions for which PBA is associated.
So as we develop our target list, we really are focused on those doctors that we believe are seeing the most patients. The way that breaks out, is as you would expect, a high percentage of neurologists and we expect a range of 5 and 6000 neurologists.
There are also a number of psychiatrists really focused on the geriatric psychiatrists and there we believe there are about 2,000 that are important. Third group is, its called physical medicine and rehabilitation specialist and those are people that help with the neuro-rehabilitation like stroke and dramatic brain injury and there is about 1,000 of those doctors in the US.
The remaining doctors consist of geriatricians, as well as people like the long-term care medical directors. And what we expect the sales force to do after starting with that initial target which was about 200 is focusing in on the top 125 to 150 if they think will be these are the best targets to call on during the initial launch period of AVP-923 and there so we'd expect a range of about 10,000 to 12,000 doctors.
And the second part of your question was in regard to how many offers are out there? We haven't provided update, nor I do I think they will provide updates in terms of the offers. What I can say is that we have the date received over 1,500 resumes, a very high quality of candidates with deep CNS experience as well as really, high performing people, top 10% of the sales force, President's club winners in the likes and we have got a great sales leader onboard, we have two great sales managers onboard and they are spending a lot of their time calling through all of the candidates that we have and we are going to end up with continued offers to the ones that we think are the best 75.
Is that the profile that you are looking for? Folks with CNS experience, are you looking for more sort of a large pharma background or spec pharma of background?
We are really open, we want to see driven the high performers anytime that you are building a market, you want to make sure that, that people can really function in that type of environment where they have some freedom. So I would expect that the sales team will be a mix of some larger pharma people, certainly from some smaller biotech people and certainly a large percentage of people who have CNS experience.
You can't trade-off the value of someone who has been calling on positions for five or 10 years, those who are well can walk in the office and then immediately start talking about PBA or once AVC-923 is approved, start talking about treatments for PBA. So we will have a good mix but certainly we way have beyond on the CNS experience.
Great, last question before I happen to queue, what medical meetings, upcoming medical meetings do you plan on having data and the commercial presence at in the near future?
The schedule is pretty quiet over the remaining month, I think the next meeting that's coming up towards the end of the year is the ANA meetings and we will certainly be at the ANA meeting and we can get back to you with the full schedule, I don't have that directly in front of me.
The next question is from the line of Mike King.
I wanted to just perhaps before jumping over to commercial side, just discuss any other remaining items between now and approval, Randall you mentioned the possibility of the panel meeting, can you give us the pros and the cons and typically agency has for first in-class medications does have typically hold the panel hearing, we are going to get a little bit late towards the producer date, what kind of things you think the agency would want to seek the advice of experts on with respect to 93?
Our going philosophy with regards to an Avicom is we don't believe the FDA will require or request one, they did not request one for the original NDA that was filed and as we've mentioned today, because this is not a new molecular entity, this division is not required by statute to have an advisory committee.
So they would decide to have one because they think they need the input and insight from an external group of folks. So that being said, well we still believe the likelihood is extremely low and we continue to prepare as if we are going to have one. And feel that we could be very, very successful based on the level and degree of preparation we've had so far. And I agree, it is getting late in terms of the challenge of FDA being able to put together a meeting in time generally FDA needs to inform the sponsor and give them 55 business days, not calendar days, so business days advanced prior to scheduling that advisory committee.
So it's getting closer and closer to that point, but again we haven't had a communication from FDA either positively or negatively with regards to an advisory committee.
Okay, it was just as far as I can recall first, you guys have mentioned on a public call, I'm just trying to see if there is a, I know there is, it would go to Neurology I presume at Adcom?
Yes, it would.
I'm just trying to see what's on the calendar between now and year end, because doesn't seem to be anything in September?
But it doesn't appear to be schedules meeting that would be relevant to our complete response at this point.
Let me ask you a different question, can you remind us what is part of the database as far as drug-drug interactions or concerned I had some conversations with investors, just regarding sort of how robust is the database of drug-drug interactions for 923 with respect to other meds that these patients might beyond as specifically and anti-psychotic and they own inhibitors and like of that?
Drug-drug interactions with the components of AVP-923 that being dextromethorphan and quinidine are very well characterized and readily and easily managed by physicians. And these are three or four interactions to the six interactions drugs known to prolong QT is a routine [DDI] that physicians manage each and every day especially those that are in the neuroscience area.
There is an extensive amount of data about the impact of CYP384 inhibitors and how that will affect the quinidine component for example and there is extensive data both in AVANIR's possession and in the public domain with regards to a CYP2D6 substrates and inhibitors.
But to the extend that the FDA views 93 as a unique chemical entity as appose to the components and there propensity inhibitor activate depends on, can you speak specifically about that?
Instead of thinking through drug-drug interaction and things we can't come up with the parallel, in many ways you know ones who consider some of the accessories is being very similar in terms of profile, if you think of the drug like (inaudible) one of the accessories, it is a CYP2D6 inhibitor it also is a CYP2D6 substrates and I think that's an interesting way of framing up AVP-923s components dextromethorphan is a CYP2D6 substrate and quinidine is a CYP2D6 inhibitor and generally that's the framework but I think it is a useful way of looking at the compound.
Finally, as part of the ramps would you contemplate any story of cardiovascular testing or respiratory testing prior to initiating therapy?
The parent (inaudible) that I was proactively proposed to FDA includes education on disease state awareness so making sure we are identifying appropriate patients with PBA for therapy and there is information in the REMS that would be consistent with proposed package insert with regards to the management of drug-drug interactions as you indicated and managing along side with drug that are known to prolong QT.
That's the one that we have submitted proactively in the REMS has or say two levels of component one is the medication guide so that would be the elements that are present and then the communication plan which again proactively to go out and educate Healthcare professionals on those educational messages that I just outlined.
And Mike, just to build on Randall's comments and to address some, your question specifically and we did not submit any type of, cardiovascular monitoring and the reason for that is if you look at our recent example of a product that was approved by Neuroform they quinidine Korea has a very similar TTC profile as India and there is no monitoring requirements within their packaging sir?
No I don't mean the monitoring, I mean just sort of maybe a baseline on, baseline EKG or some kind of FEB testing just to especially with the dextromethorphan component to make sure there is no risk to a compromise or will you have some kind of recommendation precaution with patients below or certain percent predicted of FEB or something like that?
For both of those, the [delinquency] outlines generally are put into the proposed package insert. As we would anticipate if you were to enter into labeling discussions based on the labeling discussions a way of managing certain labels often can be to employ REMs but at this point REMs is purely focused on informing Healthcare professionals and patients about the disease of the shorter and then the QTC and interaction for the outline.
And next question is from the line of Carol Werther.
Can you comment on whether or not you have had your manufacturing plant inspected?
We are the manufacturer of AVP-923 is Papillon well known manufacturer with a number of plants throughout North America. We are not going to go in the specific detail in terms of FDA specifics, all we can say is that we are very confident in Papillon and in the facilities that we are using with Papillon and do not expect that there would be any issues whatsoever with the FDA's or relate to the manufacturing facilities.
Okay and do you have any update on when the trial might be published?
It's Randall, it's been submitted and we hope to be able to make an announcement as soon as we have additional information on that.
Okay, do you think you will have any post-approval commitments at this point?
My experience is generally, there are always some post approval commitments, I know we will have some preclinical post approval commitments that can be readily completed and these are part of the negotiations that we had with FDA over the past four years. And again my experience is yes, we will and I would just be guessing on which ones those will be at this point.
Okay and then, my last question is, where are you on your idea of partnering especially rest of the world?
Yes, so in terms of the overall business development update as we have stated previously, continues to be at a high level of interest in AVP-923 there are very few unencumbered assets out there and even fewer within the CNS space, so interest is still high now that we are within three months of our producer date, we are building on our commercial organization, we really feel that we are equipped and have the capabilities to discuss commercialize within the United States and that is definitely our plan.
As it relates to rest of world, we think could be economic value of the rest of the world will increase with FDA approval so while we continue to have discussions about rest of the world, and do not expect that they would pickup in intensity until the other side of FDA approval.
Your next question is from the line of McDuffy.
Good morning and thanks for taking my question. You mentioned some of the market research you were doing on some of the aspects of the product, I'm wondering if you could focus on and share with us the things that really stood out most physicians about AVP-923's profile and then also how you are based on the pricing that you have related to 3000 to 5000 per year, how you think Managed Care is going to handle that in terms of tiering and prior authorization?
Yeah, great question that so we actually presented some new data at a conference earlier this week, the (inaudible) conference highlighting some of that exact information which you requested. We think some of the most encouraging information out of our recent research is first, looking at physicians, interpretations and perception of PBA over the last three to four years, we did not know exactly if opinions would have changed and we were very comforted to see that if anything coalition think that PBA is more important today, it's certainly as important as they thought it was three to four years ago, they still recognize it and they're still highly interested in achievement for it.
So that really creates the foundation because obviously if you are launching our first in-class product into a new market, you want to make sure that physician receptivity is there and our newest research certainly shows that it was there. And some of the additional findings that we are encouraging is when we expose the new AVP-923 clinical profile and that's the STAR data in particular to commission that they are very positive about it.
In total, about 85% of doctors said that they probably or definitely would prescribe Zenvia to their patients which is a very high percentage of doctors and additionally, more than three quarters they said that they would prescribe it as first line therapy for patients with PBA and some of that actually really rose to the top are as they look at the clinical profile of Zenvia were first a drug that indicated for PBA, a new treatment alternative that they have not had available before.
And then looking at the really strong efficacy that was observed in the clinical trial and also the safety and tolerability profile we found that very favorable as well. And then I think that final part of your question was in regards that Managed Care, we have done a fair bit of work with managed care both qualitative and quantitative market research as well as hosting manage care advisor board meeting, what we have heard from payers is that its very consistent that even if that at the price points that we are contemplating that the impact of it overall pharmacy budget they did not expect would be significant, they recognize that there are no other approved agents for PBA and that they will provide coverage.
And the question of will they put it on tier-2 or tier-3, and will they put any kind of prior off restrictions or step at it, it's a quantity limit in we will be directly related to the price that we charge and the higher price that we charge, the greater the likelihood they will put barriers in place to limit the use of AVP-923. So, as we are thinking about our price band that we talked about today between $3,000 and $5,000, those are really trade-off that we are thinking about towards the higher end of the range certainly you'll get some more barriers from manage care and towards the lower end of the range, fewer barriers and greater tier-2 placement.
The next question is a follow-up from the line of Ritu Baral
What is your strategy on inventory on hand, do you plan on starting to buildup inventory on approval? Do you already have some stockpiled?
We do, as part of commercial readiness, you want to make sure that your initial commercial manufacturing loss are made well in advance of the approval, they can do the appropriate QA and then QC testing to those lots. So at the current time, we have sufficient quantities to provide inventory for launch and actually a reasonable period to post-launch the benefit of the combination of dextromethorphan and quinidine is that the manufacturing process can be rather fast and that we can teller future supply need to market demand. So market demand exceeds our expectations we can very easily increase the supply quantities that we have but at the current time we definitely do have enough to supply for launch.
And final question, have you had any additional talks with either European regulators or basically European regulatory consultants about the path in Europe?
Right now our first, second and third focus is on US PBA approval, we recognized the opportunity within Europe, it is high on our radar screen, it will go into advance math as soon as we have clarity here within the states. So stay tuned for more information on that in the future, but right now we are keeping the team just laser focused on FDA, responding to FDA interactions and doing everything we can do ensure approval on October 30.
You planned on basically advancing that in parallel with your European talks.
Your next question is a follow-up from the line of Mike King.
Just curious on the name, would the FDA considers Zenvia to be too promotional or was it viewed as being to easily confuse it with something else?
The FDA did not approved the name Zenvia for promotional reasons and specifically FDA is focused on the first three letters of Zenvia name which is Zen and Zen refers to well being, so interpretation is that with the drug that hasn't shown an improvements of well being and that could on have unsubstantiated plan.
My experience is these things occur as you put names post to FDA, we have backup names that were available and upon not getting send the approve immediately I assume that additional names.
No. I've seen it before, I could come up with the wise crack also but I rather do that privately. Also I just guess on the pricing $3,000 to $5,000 a year for something that is debilitating or potentially debilitating PBA seems rather low so I just wonder what kind of benefits or how did you guys sort of zero in on that range, what was the thinking that went into it and if we can elucidate your serious thought process on that for us?
Certainly and then I think they covered a lot of our thinking on in response to Matt's question earlier, but the way that we really look at it is, there are certain threshold points that when you hit with managed care that you absolutely step into let's call the specialty bucket and when you step into that specialty bucket your guarantee could be tier 3, your guarantee prior off step at its quantity restrictions you name it and that price point is around $500 per month and so about $6000 per year.
So really the fine balancing act here if you will is trying to pickup price points in which you're maximizing the individual patient revenue but ensuring access of largest number of patients. And for us, because we believe that there are so many patients in the United States that suffer from PBA, we really need to think about that very carefully and we need to balance it such that, we do the best job we can to let the most patients have access to Zenvia, and but also at the same time maximize our revenues.
So our work is still ongoing in terms of pricing, we are comfortable in that $3,000 to $5,000 price range now. Credit go higher in the future, it could, so we are not stating anything definitively, we still have more work to do, we still package and sort of looks like and then these additional testing on the back side of the package insert. So stay tune but I hope that give you some insight in how we are thinking about the process.
What's that the drug that you mentioned name the drug for (inaudible) Korea,
And what's that priced at per year?
I think quinidine is priced, I think its $15,000 to $20,000 per year I believe.
But that's because it just limited to (inaudible) and no other potential uses across other indications, is that a fair statement?
Exactly and when you think about other drugs like (inaudible) add approximately $14,000 a year, then or two you're limited just to MS population and that subset of MS patients that have blocking in mobility problems and actually receive a benefit from the product as well.
Your next question is from the line of Pamela Bassett.
Just a quick question, when should we look for your 10-Q?
10-Q should be filed here by the end of the week correct me if I'm wrong Christine.
That is correct.
(Operator Instructions). At this time there are no further questions.
Great. Well, thank you everyone for joining us on our fiscal third quarter conference call. We look forward to keeping you update in our projects.
Thank you for joining today's conference call. You may now disconnect.
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