Idenix Pharmaceuticals (IDIX) Presents at UBS Global Healthcare Conference (Transcript)

| About: Idenix Pharmaceuticals, (IDIX)

Idenix Pharmaceuticals Inc. (NASDAQ:IDIX)

UBS Global Healthcare Conference

May 19, 2014 08:00 AM ET


Daniella Beckman - CFO


Matt Roden - UBS

Matt Roden

Good morning, everybody. I'm Matt Roden, biotech analyst here at UBS. And we're pleased to kickoff our Global Healthcare Conference this morning with Idenix Pharmaceuticals. Company focused on the development of nucleotide/nucleoside analogs for treatment of antivirals -- for antiviral medications and perhaps other applications as well. Speaking on behalf of Idenix, its Chief Financial Officer is Daniella Beckman. Daniella served in this role since June 2011, and earlier was the corporate controller since 2008. Prior to joining Idenix, Daniella was also controller of Coley Pharmaceuticals and held various positions at Biogen Idec as well as PricewaterhouseCoopers. I would remind everyone that the breakout session is to follow the presentation. That’s across the hall in the Carnegie West. Daniella?

Daniella Beckman

Thanks Matt and thanks for your time today and letting me speak to you a little bit about Idenix. Before I begin I’ll just review our Safe Harbor statements. This presentation will include forward-looking statements about our business that are subject to risk and uncertainties that are detailed in our SEC filings.

Idenix is currently focused on developing a cure for Hepatitis C or HCV. Our strategy is to advance all oral, pan-genotypic combination regimens to treat patients with HCV. We have a long history of developing and discovering nucleotides or nukes. Now I want to emphasize here that we do believe that nukes will be a backbone component in the future of all oral HCV regimens. Nukes are generally pan-genotypic, potent, have a high barrier to resistance, and low potential for drug-drug interactions. They also offer a unique mechanism of action compared to other types or other classes of drugs.

IDX21437 is our lead uridine nucleotide. It has shown potent pan-genotypic activity in our recent proof-of-concept study that has concluded. Behind it we have IDX 21459 which is another uridine nuke which is currently in a clinical trial in Europe. We are also concentrated on our NS5A inhibitors. Our lead program is samatasvir. Samatasvir is currently in two Phase 2 clinical trials under our collaboration with Janssen and has shown potent pan-genotypic activity and has generated a safety database through these phase 2 clinical trials for 12 weeks of about 140 patients. Ultimately, we plan to combine these two programs, our nucleotide and NS5A programs in all oral pan-genotypic HCV combination trial which will be a Phase 2 clinical trial, which we hope to initiate in mid-2014.

So I’ll go into all of these programs a little bit more in the presentation, but wanted to take a moment just to speak about the HCV marketplace. We believe there are several components that contribute to the significant commercial opportunities for hepatitis C. First is the size of the market. With over 150 million people worldwide that are infected with HCV, this generates market estimates of greater than 200 billion cumulative.

And although there is a large market, a lot of people infected with hepatitis C, we do believe it will have a long tail in the market place as many of these patients do not yet know that they are infected with this disease. So this along with other factors will create a long tail in the market place and take more than a decade to treat patients. Therefore we believe there is ample market opportunities for companies to compete in this space.

We believe that Idenix is well-positioned to play a significant role in the future of HCV treatment because we believe that we have a differentiated profile. Many of the regimens that are either on the market or in development currently are focused on genotype 1 patients. And some of the regimens that have recently been improved still have pegylated interferon which is administered through injection as well as ribavirin included in the regimens. We believe that Idenix with an all oral pan-genotypic regimen will be important in this space.

I’ll now go into each one of these components in a little more detail on the next couple of slides. So starting off, why we think the marketplace will be sustainable until 2030? First, we acknowledge that all orals will have -- that will hit the market will increase the number of patients that are treated. And this is really due to better all oral treatments that have less side-effects, but also due to screening initiatives that will be increased and the patient awareness programs that will take effect. We do believe that these changes in these programs will take longer to have an impact than currently expected.

Out of the 150 million people infected worldwide, roughly half of these patients do not know they have the disease and 3 million to 4 million patients become infected each year. These patients are initially asymptomatic and typically take between 15 years to 20 years, to show signs of the disease before they are diagnosed. In roughly half of these patients, an abnormality does not show up on a routine blood test until they have severe liver damage. The next challenge will be the high cost and restrictions Managed Care may impose, such as limiting prescribing to physicians, to specialists, or harder to treat patient populations especially outside the U.S.

Currently, we know there are countries limiting prescriptions to patients that have high fibrosis scores or significant liver damage. With no near-term opportunities to increase capacity or drug budgets in these areas, we believe that there will be an economic warehousing and take more than 10 years to treat already diagnosed patients.

So those that are familiar with the HCV space I think have seen these numbers. Epidemiology currently shows prevalence of about 8 million patients in the U.S., EU side and Japan with 3 million diagnosed and 5 million undiagnosed. So that’s roughly 60% of patients that currently do not know they have the disease.

Consensus is reporting about $15 billion to $20 billion in annual HCV global sales peaking in years 2016 to 2018. And although it is a large market, there are many companies competing to cure Hepatitis C which I’ll show you in a later slide but it is important to have a differentiated regimen in order to stay competitive and one way that Idenix plans to have a different profile is to target pan-genotypic coverage.

In some of our own market research of over 300 physicians in the EU, U.S. and Canada, doctors have said that the main component that they would like to see in the next generation therapeutics for Hepatitis C is pan-genotypic coverage. I do want to mention they also mentioned that convenience such as a co-formulated pillar like rabavirin was also important. And as I previously mentioned, most of the regimens that are in development or in the market are concentrated on genotype 1 but as you can see from the chart here, more than half of the global population is not genotype 1. Therefore we think a pan-genotypic approach is very desirable to treat more patients.

So knowing there is a large market for HCV, there are several companies competing to cure patients with Hepatitis C and this is just a chart showing several -- all oral HCV regimens that have launch dates by 2018 and the regimens are grouped by characteristics labeled on the left here. So assuming all of these make it to the market the prescribing doctors have a lot of choices to choose from in order to treat their patients. But again this goes back to our market research that said that doctors want to have something that’s potent and safe but also convenient, that can treat all patients.

Given the potential regimens, the options become very limited when you look for something with high cure rates, a co-formulated pill low, potential for drug-drug-drug interactions and pan-genotypic activity. We believe that new nucleotides pro-drugs will be a key backbone component of future Hepatitis C regimens.

So going now into some details around our lead uridine nucleotide pro-drug program IDX-21437. We’re very pleased with its preclinical profile to-date. We have recently completed the three month toxicology program and we are -- have seen good safety margins at our anticipated clinical doses. We’ve also done extensive preclinical testing around genetox, mitochondrial and cardiac safety as these have been known safety issues for nukes in the past and IDX-21437 has shown clean assessments in these areas to-date. Based on our analysis for in vitro and in vivo we expected IDX-21437 to have good potent and pan-genotypic activity which was confirmed in the clinic. I’ll show you that data in a couple of slides. It also has favorable drug-drug interaction profile.

So moving on into the clinical trial details, IDX-21437 is finishing up a Phase I/II clinical trial, which was conducted in several countries outside the U.S. I do want to mention here that we plan to incorporate some U.S. clinical trial sites in our future clinical program. We plan to engage the FDA in conversations this year providing them with some clinical data around IDX-21437 as well as discussing next steps in the clinical trial designs in the U.S.

The clinical trial designing of this study, we had some multiple and single dose portions of the study that gave us an early look at PK dosing and safety and up to our top dose of 300 milligrams it was safe and healthy volunteers for seven days. We recently completed the seven day proof of concept portion of the study in 50, 150 and 300 milligram doses, which I’ll show you on the next slide the results of that. It is currently ongoing in psoriatic patients.

The overall safety of IDX-21437 was proven safe and well tolerated in the study up to seven days and based on the results of the seven day POC, we are taking forward the 300 milligram dose and then dampening that into a Phase II combination study of IDX-21437 and [indiscernible] here in mid-’14.

So moving on into the anti-viral activity of the POC, we enrolled about 44 treatment naive genotypes 1, 2 and 3 patient -- HCV patients, and in the 300 milligram arm we showed genotype 1 mean maximum viral load reductions of 4.2 logs and had one patient undetectable in that arm. And then genotype 2 and 3, we achieved 4.3 logs with two patients becoming undetectable. Again, this is just top line data. We plan to report some more details around the 50 and the 100 milligram arms as well as genotype 2 and 3 at a future scientific meeting.

So this graph shows a comparison of the 300 milligram QD dose of IDX-21437 and the 400 milligram dose QD of samatasvir up to 7 days, and as you can see, they line up pretty closely to each other. So we do believe that IDX 21437 will be potent and competitive in this field.

And as I mentioned, our ultimate goal is to combine IDX 21437 and samatasvir. We have already completed the development and the formulation work to combine them into a co-formulated pill. We believe that a nuke and a NS5A combination has the greatest benefit to cure Hepatitis C.

Some of the reasons are because of the scarcity of the asset, the ability to have a one pill, all oral once daily dosing which is our commercial goal, the high barrier to resistance, the potential to be safe, potent and have low potential for drug-drug interactions.

So moving on to samatasvir, this is our NS5A inhibitor program. The preclinical profile has shown potent pan-genotypic activity and favorable safety profile. Samatasvir has shown potent pan-genotypic activity in a three-day proof-of-concept and as I mentioned is currently in two Phase 2 clinical trials under our Janssen collaboration. These trials are referred to as HELIX 1 and HELIX 2, which I’ll go into more detail in the next couple of slides.

So starting off with HELIX 1, this is our 12 week two DAA combination of samatasvir and simeprevir plus ribavirin in genotype 1B and 4 patients. The main goal for this study was to create a safety database around samatasvir and that regimen was well tolerated with no treatment related adverse events in the clinic. We also reported 85% of SVR rate in the 50 mg samatasvir, 150 mg simeprevir group, and based on the results of this study, we decided to take forward the 50 mg dose into the ongoing HELIX 2 program.

So HELIX 2 is a combination of samatasvir, simeprevir and adding Janssen’s non-nuke ritonavir boosted TMC647055, with and without ribavirin. The study was started in December 2013 and we anticipate having SVR 4 data in the second half of this year. And we may add some exploratory arms based on the data of this 40 patient trial right now.

So moving on into our discovery program around our nukes for HCV and beyond, because we expected there to be a long tail in the HCV marketplace, we feel it’s prudent to invest our time and effort on the discovery of nucleotides. We believe they are very important for the treatment of Hepatitis C. Idenix has been working in this area for several years and believe that our core competencies are around our nucleotide chemistry as well as our pro-drug expertise. We also believe we have strong IP in this area that was generated out of the discovery work that we have been performing since the founding of our Company in 1998.

Over the last couple of years we have intensified our efforts around nuke discovery and have tried to improve the characteristics of nuke pro-drugs to have a potent and safe nuke. Looking at different novel basis, pro-drugs and sugars, we’ve generated over 2000 nucleotide pro-drugs as part of this effort and as I mentioned IDX21437 and IDX459 are currently in the clinic. We’re also working on discovery efforts to combine two nuke with overlapping resistance profiles to generate new nuke strategy. Our main goal is to combine our nuke with our NS5A, but out of the discovery work that we’ve been performing around nukes, we also want to leverage that expertise in areas beyond Hepatitis C.

Idenix believes that we have one of the broadest programs looking at what our full potential of our nuke platform can provide in HCV, other infectious disease as well as oncology and we’re just starting the efforts of looking at what is in our compound library and screening the existing compounds. We’ve had some initial hits in other infectious disease areas as well as oncology and have started some pilot programs in these areas trying to leverage our in-house expertise around nucleotides in pro-drug technology. I do want to mention here that our main focus remains on HCV, even though these pilot programs are ongoing.

Now I’ll summarize for you some of the ongoing legal matters that we have with Gilead. In the past Idenix has been in the position of defending our IP related to matters that have been declared by the United States Patent and Trade Office or USPTO as well as Gilead. But more recently we’ve gone on the offensive in filing patent infringement lawsuits in the U.S. as well as Europe.

In the U.S. we filed patent infringements against Gilead late last year in Delaware as well as Massachusetts, and in the EU in early ’14, in France, Germany and the UK. As part of the Delaware infringement lawsuits we also filed a patent interference which was initiated by Idenix.

The USPTO, as I mentioned, has declared patent interferences between Idenix in Gilead, patent interferences are generally declared when the patent office reviews an application that is too similar to an existing patent. The first interference was declared in favor of Gilead, however, we are appealing that decision outside the USPTO in the district Court of Delaware and we also have a second interference ongoing.

We also have several invalidity matters ongoing in China, Canada, Norway and Australia. The Norwegian courts have ruled in favor of Gilead and Idenix is currently appealing this decision. I want to emphasize here that I think that this will be a long process as there are several cases ongoing with different rules, procedures and evidence that will ultimately determine which party will prevail in these cases. Some of the information that we are learning will be cumulatively helpful to Idenix I think in the long run.

So now turning to our finances, we ended the first quarter of 2014 with $205 million in cash which will be sufficient to at least the second half of 2015. With a strong cash balance we’ll be able to fund all the programs I mentioned today including the HELIX trials and proof of concept studies of IDX-21437 and IDX-459. We’ll also be able to initiate in complete large Phase II clinical trial of IDX-21437 in samatasvir as well as fund our legal strategy.

So I’ll now summarize for you the key milestones we intend to accomplish in 2014. We plan to initiate the Phase II combination trial of IDX-21437 in samatasvir which is a Phase II clinical trial in mid-’14 and report some SVR4 data from that study by the end of this year. And under our Janssen collaboration we’ll plan to release some SVR4 data in the second half of 2014 related to HELIX-2 which is the samatasvir, simeprevir and TMC647055 clinical trial.

So I’d like to thank you for your time today. I believe we have a breakout session across the hall immediately filing the presentation. Thank you.

Matt Roden

Yes. And I would add that the Chief Medical Officer, Doug Mayers is going to join us for that breakout as well.

Question-And-Answer Session

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