Prosensa Holding's (RNA) CEO Hans Schikan on Q2 2014 Results - Earnings Call Transcript

| About: Prosensa Holding (RNA)

Prosensa Holding N.V. (NASDAQ:RNA)

Q2 2014 Earnings Conference Call

August 12, 2014 8:00 am ET


Celia Economides - Senior Director, IR & Corporate Communications

Hans Schikan - CEO

Giles Campion - CMO

Luc Dochez - Chief Business Officer

Berndt Modig - CFO


Paul Matteis - Leerink Partners

Debjit Chattopadhyay - ROTH Capital Partners

Christopher Marai - Oppenheimer

Jan De Kerpel - KBC Securities


Greetings and welcome to the Prosensa Second Quarter 2014 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. (Operator Instructions). As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Celia Economides, Senior Director of Investor Relations and Corporate Communications. Thank you. You may begin.

Celia Economides

Thank you, operator, and thank you everyone for joining us. On behalf of Prosensa, I would like to welcome everyone to our second quarter 2014 earnings call for the quarter ending on June 30, 2014. With me today are Hans Schikan, Chief Executive Officer; Giles Campion, Chief Medical Officer; Luc Dochez, Chief Business Officer; and Berndt Modig, Chief Financial Officer.

Earlier today, we issued a press release containing results for the second quarter of 2014, which is available on our website at Today, we also filed our quarterly financial statements and management discussion and analysis with the SEC.

During today's call, we may make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements about our future expectation, clinical developments and regulatory timeline, the potential success of our product candidates and financial projections. Actual results may differ materially from those indicated by these statements.

Forward-looking statements during this call include statements around our exon-skipping drug pipeline including drisapersen, the regulatory review of our product candidate, our intellectual property position and our financial position. Such forward-looking information involves risks and uncertainties that could significantly affect expected results. These risks and uncertainties are discussed in the company's SEC filings including, but not limited to, the company's annual report on Form 20-F.

In addition, any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. While we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so even if our views change.

With that, let me pass the call over to Hans.

Hans Schikan

Thank you, Celia, and good morning, good afternoon, everyone. Thank you for joining us today for our second quarter 2014 earnings call. On today’s call we will be providing you updates on the status of our lead exon-skipping program drisapersen, the rest of our DMD portfolio, our intellectual property portfolio and our financials.

This last quarter has been an exciting one for the company as we have made substantial progress in advancing drisapersen for the treatment Duchenne muscular dystrophy. And for boys with DMD we are delighted that the prospects for a treatment being available in the near future are now looking positive.

To put our achievements of the quarter into context, you will recall that on January 12 we regained the rights to drisapersen from GSK and thanks to tremendous hard work and dedication by many people in the company we have transferred from GSK numerous data, reports, files and the like of the drisapersen program.

This has been a complex process. For instance, more than 350,000 clinical trial files have been transferred, and this involved a great number of disciplines across the company.

We've always been positive about the potential of drisapersen and we continue to be encouraged by the totality of the data from the drisapersen clinical program. Our pioneering work in DMD for more than a decade means that we have the largest clinical dataset in DMD comprising three placebo controls and two long-term open label studies treating over 300 patients and comprising over 450 patient treatment years.

It has been an amazing journey and we have learned a tremendous amount that enables us to better understand both the natural history of DMD as well as put the vast dataset we have into context. We have shared our interpretation of the data with key experts in DMD, with patient organizations and with regulators as it has emerged, including additional detailed analyses we have been able to perform.

In the longest study to-date for drisapersen, boys have been treated over four years with efficacy data reported up to 177 weeks, that’s almost 3.5 years. This study included 10 boys who performed clinical endpoint of the six-minute walk test at the start of the study. At week 177, the mean age of these boys was merely 13 years. The mean change from baseline is six-minute walk test, the current gold standard measure of DMD progression, from this group of 10 boys was minus 25 meters, which includes two boys that had become non-ambulant earlier in the study.

Natural history data suggest that DMD boys can lose anywhere from 40 meters to 60 meters on the six-minute walk test per year and over 120 meters over two years.

At the time we received rights to drisapersen back fro GSK, we immediately took steps to develop re-dosing plans for boys who had previously participated in drisapersen clinical trials in addition to engaging with regulators in both the United States and Europe. Re-dosing protocols are in the process of being submitted to relevant institutional review boards and we remain on track to re-dosing the first patients before the end of the third quarter.

We've had ongoing dialog with both the FDA and EMA since January to discuss our dataset. This dialog included the discussion on the positive outcome of the first placebo controlled study with drisapersen which showed statistically significant and clinical relevant results. The second placebo-controlled study which was supportive, and two, supportive open label space. However the dialogue also focused on the unanticipated results of the Phase III study. The hypothesis that have emerged on the basis of our assessment of the data is that the Phase III trial may have failed the drug rather than the drug failing the trial.

When the trail began in 2010 much of the natural history of the disease was not yet known. It was a large study for a rare disease conducted in 44 sites in 19 countries. The extensive global reach of the trail likely contributed to the extreme heterogeneity of the basin population that was enrolled. This is apparent when comparing the base line characteristic of the boys in the Phase III trial further boys in the order of placebo-controlled trails.

Boys in the Phase III had a lower baseline six minute walk test, performed worst in all tests of muscle function and were generally older, all of which may be correlated with increased disease progression.

In the original guidance to Prosensa, which we published in full on our websites the FDA sites that it's possible but at this stage not necessarily conclusive that some of the factors might have contributed to the findings in the Phase III study where only a 10 meter difference was observed in the six minute walk test between drisapersen and placebo after 48 weeks in contrast to the positive and supportive findings in earlier studies.

On June 3, we were pleased to announce that based on the guidance we received from the FDA; we intend to pursue a new drug application an NDA filing for drisapersen, based upon existing data under an accelerated approval pathway later this year. Based on our analysis we believe that early intervention in this disease may delay progression of DMD and hopefully improve the quality of life and life expectancy of boys with DMD.

In line with the FDA guidance, and our own strategic plans we will be commencing the confirmatory post-approval study for drisapersen, which will be an open label study where the results will be compared with the natural history group of boys. In addition, we intend to start the placebo-controlled study in one of our follow-on compounds in the first half of 2015 to further validated our exon skipping technology platform, of which PRO044 may serve this purpose.

Our dialogue with regulators in Europe also continues. And based upon number of interactions, we anticipate filing for a conditional approval of drisapersen in the EU shortly after we submit the NDA to the FDA.

Given the urgent need to find effective therapies for boys with these devastating and fatal disease we are very encouraged with a favorable outcome of our interactions with the FDA, with a degree of urgency both regulatory authorities have placed well accelerating developments and potential approval of treatment options.

We are happy for the patient community that first a disease modifying therapy has been approved, with the recent decision by the European Regulators for PTC's Translarna. It's a monumental time for all stakeholders in this space and we are honored to be a key player in this story. It's clear that patients, families, clinicians, and patients and placebo group voices have been heard loud and clear and for the first time we are in an environment where there is very real hope and with patients and their families have options than before they had no. We are incredibly grateful to many patients advocacy groups that have supported us over the years especially in the last year during some difficult times.

We continue to expand our internal capabilities to meet the needs of a pre-commercial company and on 30 of June we announced the appointments of Willem van Weperen to the new position as Chief Commercial Officer and the addition of Dr. Annalisa Jenkins to our Supervisory Board.

As we enter this turning point for Prosensa, we are delighted to welcome Willem a very important addition to our management team and are confident that is more than two decades of commercial experience at Genzyme, which culminated as global heads of marketing for Genzyme's rare disease portfolio, operating from its global headquarters in Boston, and his recent leadership of to-BBB will add valuable skills and experience. He brings significant business, operational, and commercial expertise to Prosensa, in advance of an anticipated launch of the company's first product for the treatment of DMD.

We're also delighted to welcome Annalisa to represent our Supervisory Board. Her extensive experience in research and clinical developments and medical affairs from Merck Serono and Bristol-Myers Squibb will bring valuable insight to us as we take the company to the next level.

We continue to expand our global presence with experienced employees in both United States, the United Kingdom, in addition to Netherlands.

With that overview of the intelligent position we are in, I would now like to turn the call over to Giles Campion, our Chief Medical Officer, who will provide some more detail on our clinical and regulatory progress over the quarter.

Giles Campion

Thank you, Hans. As Hans previously mentioned on June 3, 2014, we announced that following positive feedback from the meeting that took place on May 14 with the FDA. We will pursue an NDA filing for drisapersen under an accelerated approval pathway based on existing data later this year.

The FDA urged Prosensa to commit to the initiation of two confirmatory post-approval studies. Therefore, we anticipate commencing a confirmatory post-approval open label study for drisapersen in addition to a placebo-controlled study with follow-on exon in the first half of 2015. The goal of these studies is to provide a confirmatory data on the effectiveness of our exon skipping approach, and also provide data to be used towards the approval of our follow-on compound addressing other mutations, plus extending the group of DMD patients that can benefit from that approach.

We have a follow-up meeting scheduled with the FDA later this quarter to discuss the progress with our pending drisapersen submission.

In addition to making this positive progress with the FDA, we have also engaged with European Regulators. Based on these interactions, we expect to be in a position to file for conditional approval in Europe, following our NDA submission offering hope to DMD boys in Europe as well as in the USA.

On May 1, we announced that based on positive feedback from both patients and investigators regarding the willingness and desire of patients to go back on drisapersen we would be re-dosing an initial group of boys in the third quarter. As communicated to patient groups and investigators, re-dosing will be phased and the first wave of re-dosing will focus on sites in North America and Europe. As Hans mentioned, re-dosing protocols in the process of being submitted to relevant institutional review boards and we expect to start dosing an initial group of boys by the end of September.

During the quarter, we also announced that Prosensa successfully completed the enrollment of its prospective Natural History Study designed to further increase the understanding of DMD patients and their diseases progression. This study has enrolled a total of 269 boys with confirmed DMD between the ages 3 and 18 from 10 countries across 16 centers in North and South America and Europe, 80% of patients are ambulatory and 20% are non-ambulatory. The purpose of the study is to characterize the natural history and progression of DMD, which will help inform the design of future studies, to capture biomarkers of safety and disease progression, and to provide comparative data for patients with rare exon deletions/mutations for which formal controlled trials are not feasible. Our investment in this study is important and may potentially serve as a control for the confirmatory program for drisapersen. Interim one year data for the study is expected before the end of the year.

The other clinical progress for Prosensa PRO044 our next most advanced product candidate before we have in the clinic addresses a subpopulation of up to 6% of DMD patients. PRO044 has completed a Phase I/II study in Europe and results were presented in October 2014. We expect to begin an extension study for PRO044 this year.

Yesterday we announced that we have strengthened our collaboration with an affiliate of our longtime support of CureDuchenne where we will provide up to €5 million to assist the company in a number of efforts for the cause of Prosensa's mission of developing innovative RNA based therapeutics to address unmet medical needs for patients with rare genetic disorders including, firstly, progressing the second exon skipping candidate for the treatment of DMD PRO044 by initiating a Phase II clinical extension study in Europe by the end of 2014 and a placebo-controlled trial in the first half of 2015, which may serve as one of two confirmatory studies to support a potential accelerated approval for drisapersen.

Secondly, supporting re-dosing efforts for drisapersen clinical trial participants in North America and Europe and facilitating the drugs new drug application filing in U.S. in 2014.

Third, we support in the development of Prosensa's other exon skipping compound PRO045 and PRO053. Those findings studies are ongoing to these compounds and we anticipate result for next steps for these later this year and early next year respectively.

The support provided by CureDuchenne is a great example of the important role that patient groups play in accelerating research and development for Duchenne and other diseases. We are very grateful for their everlasting support especially in the last year during some challenging times.

Our pipeline the most robust and extensive pipeline of any company working in DMD also includes PRO052 and PRO055 which are in advanced pre-clinical development.

During the course we have continued to progress with another program PROSPECT, which includes a new and innovative application of our RNA modulation technology platform. The program is moving into pre-clinical development with pre-clinical safety studies scheduled to commence next year.

This approach applies to multiple exon skipping. Our initial efforts on PROSPECT are focused on the much rarer disease exons in the 10 to 30 region of the dystrophin gene which could collectively be applicable for up to 13% of all DMD patients.

As noted in our last call, we continue to work diligently to pioneer research and development in neuromuscular space and are pleased to announce that Prosensa and collaborators have over 10 abstracts that are being accepted for platform oral post presentations in the forthcoming 19 Annual World Muscle Society Congress taking place October 7 to 11 in Berlin, Germany. As one of the premier scientific meetings for neuromuscular disease community, we are pleased that the extensive work being conducted by Prosensa and its collaborators will be so widely showcased at this important event.

Thank you. And with that I will pass the call over to Luc Dochez, our Chief Business Officer, to provide you with an update on our intellectual property portfolio.

Luc Dochez

Thank you, Giles. Please let me start with stating that although patents and patents applications are important to Prosensa as they help to protect innovation and create shareholder value that it is not our primary intent to focus solely on building a strong IP position.

The development and further advancement of a portfolio of drug candidates in order to help DMD patients is and will always be the main goal and objective for us.

But let me give you a short overview of the current IP situation, specifically focused on Exon 51. To-date we believe that Prosensa has a strong IP position for drisapersen including issued patents in Europe, Japan, and Canada. As you probably are aware, our European patent was upheld in an amended form after an opposition procedure initiated by AVI Biopharma, nowadays Sarepta, and currently an appeal procedure is standing. Until the final outcome of this appeal procedure is known, Prosensa will have an issued patent which is dominant for Exon 51 and 46 in Europe.

In the United States we have to-date two issued patents as well as two allowed patent applications that cover our lead product drisapersen.

In July, the patent trial and appeal board of the United States Patent and Trademark Office, the USPTO, declared patent interferences between certain allowed patent applications held by Prosensa and patents held by Sarepta related to Exon 51 and Exon 53 skipping product candidate designed to treat DMD. In particular the patent trial and appeal board declared interference number 106008 which relates to Exon skipping 51 another product that identified two Sarepta U.S. patents at interfering with a Prosensa allowed U.S. patent application. The board also declared interference number 106007 relating to Exon 53 skipping products that identifies another Sarepta patent at interfering also with Prosensa's allowed U.S. application. It is important to note here that in both cases Prosensa has been designated as a senior party as a result of its significantly earlier filing date.

As a short remainder, an allowed patent application is a patent application that has been examined and approved by the USPTO and that will be issued as a patent once the applicable patent issue fees are paid. A patent interference is an administrative proceeding conducted by the USPTO in order to determine which party is entitled to a patent, when two or more parties claim patent rights to the same technology.

Under applicable U.S. Law a patent is awarded then to the first party to invent a particular technology, subject to certain limitations. The applicants who filed the earlier patent application is referred to as to the senior party in the patent interference and the applicant with the later filing date is referred to as the junior party. The junior party bears the burden of proof to demonstrate that it invented the technology in question before the senior party. As said earlier, in these cases, the USPTO has so far determined that Prosensa is the senior party and that Sarepta is the junior party.

If the outcome of these proceeding is favorable to Prosensa we believe that it will create a dominant position in the United States as well. If the outcome of the interference is not favorable to Prosensa, we believe that that will not have an impact on our ability to commercialize drisapersen in the United States.

Thank you. And with that I will pass the call now over to Berndt Modig, our Chief Financial Officer to provide you with an update on the financials.

Berndt Modig

Thank you, Luc. On the financial front the condensed consolidated financial statements of Prosensa have been prepared in accordance with IFRS as issued by the International Accounting Standards Board IASB. The consolidated financial statements are presented in Euros which is the company's functional and presentation currency. All amounts mentioned here in this call are Euros unless otherwise specified.

Prosensa's cash and cash equivalent as of June 30, 2014, were €69.5 million, compared to €77.4 million as of March 31, 2014, or compared to €82.2 million as of December 31, 2013. The decrease in cash and cash equivalent was mainly due to operating activities.

Revenue for the three months ended June 30, 2014, was nil, compared to €2 million in 2013, due to a decrease in license revenue of €1.3 million, and a decrease in collaboration revenue of €0.7 million due to the termination of the research and collaboration agreement with GSK.

On June 27, 2014, the company was awarded $200,000 research grant from Parent Project Muscular Dystrophy, PPMD, a not-for-profit organization founded by parents and children with Duchenne and Becker muscular dystrophy. As of June 30, 2014, the PPMD grant proceeds are included in government and other grants to be received. We are grateful for the support provided by PPMD, which will allow us to address rare limitations in the drisapersen chain.

Yesterday we announced that our longtime supporter CureDuchenne will provide Prosensa with up to €5 million by means of convertible promissory notes to support the advancement and development of our exon skipping drug candidates. This support comes at an important time for the company and we greatly appreciate the financial and other support from CureDuchenne.

Research and development expense increased from €4.5 million in the three months ended June 30, 2013, to €5.5 million in the three months ended June 30, 2014. Research and development expenses mainly increased due to the expansion of our development and regulatory capabilities, directly impacted by the termination of the research and collaboration agreement with GSK, as well as the costs of preparing a regulatory file for drisapersen and the progressing clinical phase I/II studies of PRO045 and PRO053.

General and administrative expense increased from €2.1 million to €2.7 million in the three months ended June 30, 2013 and 2014, respectively. The increase is primarily due to share-based compensation expense and costs associated with operating as a public company in the period ended June 30, 2014, offset by expenses related to our IPO in the same period in 2013.

Net income for the three months ended June 30, has also been a loss of €8 million, or €0.22 per share, compared to a loss of €4.7 million, or €0.16 per share for the comparable period in 2013.

For 2014, the financial results of the company will be influenced by the outcome of our current interactions with the regulatory agencies about the path forward for drisapersen.

We expect that cash and cash equivalents as of December 31, 2014, will range from €53 million to €56 million. This guidance assumes €2.5 million of notes issued to an affiliate of CureDuchenne and full collection of accounts receivable from GSK and does not account for the impact of any future acquisitions, dispositions, partnerships, license transactions or changes to the company's capital structure, including future securities offerings.

I will now turn the call back over to Hans for some closing remarks. Hans?

Hans Schikan

Thank you, Berndt, and thanks to everyone for joining the call today. We remain committed to enabling a brighter future for DMD patients and to providing long-term patient access for drisapersen and our extensive follow-on programs. We are excited to be able re-dose an initial group of boys this quarter and to submit an NDA on drisapersen before the end of the year with a European filing potentially shortly thereafter. We look forward to initiating our confirmatory studies for drisapersen early next year and will continue to work very closely with and strengthen our collaborations with key patient groups.

The grant from PPMD and financial support from CureDuchenne as announced yesterday are key examples working collaboratively to advancing therapies for DMD.

This is a very exciting and encouraging time for us. We look forward to updating you as we know more.

I would now like to turn the call back to operator who will open the line for questions.

Question-and-Answer Session


(Operator Instructions). Our first question is coming from the line of Paul Matteis with Leerink Partners. Please proceed with your question.

Paul Matteis - Leerink Partners

Hey, good morning. Thanks very much for taking my questions and congrats on all of the progress. My first question comes on the confirmatory study in Europe. I'm wondering if you discussed with the EMA what confirmatory studies would look like for drisapersen, and could these studies be integrated with the confirmatory studies to satisfy the FDA for accelerated approval? Thanks.

Hans Schikan

Thanks, Paul, for that question. Regarding the European pathway of conditional approval, it's somewhat different than the accelerated approval in the United States. The FDA has given its guidance on two confirmatory studies which they urge us to start as soon as possible. And they clearly mentioned in the letter which we published in full to start both studies as soon as possible. One would be open label study with what we compare to drisapersen in a open label manner with a natural history group of boys who are not getting treatment and the other study would then be on another exon-skipping agent in order to the other exon-skipping patients in a placebo controlled study.

The FDA also made clear in that letter, which we published again and you can read that, that that pathway that placebo controlled study on another exon-skipping agent could be relevant if the accelerated approval in the U.S. were given or is going to be given on the basis of a surrogate endpoint.

So we don’t know of course yet, one, whether we will be able to get accelerated approval and, secondly, under which pathway because there are two pathways in the United States when they need and their intermediate clinical data; secondly, on the basis of a surrogate endpoint.

So the key question is to what extent which pathway actually will be followed and which confirmatory study that eventually may lead from -- for conversion from accelerated approval to full approval. That is regarding United States.

Now regarding Europe, the conditional approval pathway in Europe is different and does not allow for that possibility of a subpart path H accelerated approval. So we expect that the confirmatory program we are doing for the U.S. and specifically the study that is the open label study with drisapersen that that may be sufficient for provisional approval in Europe. And we are in that dialog, and that’s our intention to indeed have an integrated plan that the study and studies which we will be doing for FDA could in part or full be applied for our European conditional approval pathways as well. That’s the goal.

Paul Matteis - Leerink Partners

Got it, great. That’s certainly helpful. Thank you. And then on your upcoming FDA meeting regarding your NDA filing what kind of feedback from the FDA are you seeking in this meeting? What's the goal of this meeting? Is there anything specific the FDA is concerned about? I know they looked into more detail on Sarepta's methodology for assessing dystrophin expression. Have they said the same thing to you? And will there be any rehash in this meeting or any update or is it just more just checking the box and an extra meeting given that you have breakthrough therapy status? Thanks.

Hans Schikan

Okay. Regarding the meetings with the FDA, we don’t have any meeting with the FDA on the January 24 earlier this year together with GSK; we had all by Prosensa itself on the May 14 and this will be then the third meeting that’s face to face which we have with the FDA to discuss our plans for a filing and also specific elements of that file. And so it will be focusing also on the CMC aspects and given the fact that products were transferred from GSK to us now in this case we hope that meeting will be helping us to be in that trajectory of submitting our file later this year. And that's the goal to go forward and this FDA meeting should be seen in that light, another face-to-face meeting to facilitate that progress and allowing us to file and with that accelerated approval by the end of this year.

Paul Matteis - Leerink Partners

Got it. Great that make sense. And then from this 45 and 53 studies in the fourth quarter of this year and the first quarter of next year, the data readouts, what kind of data can we see from these studies, what we get drisapersen on six minute walk test data and do you think that the data portfolio you will have from the follow-on exon's will be part of your new drug application for drisapersen as a care provider, bolster your organ that exon skipping does have a therapeutic benefit to patients?

Hans Schikan

Well I will hand over to Giles in a second to give his view on this. Of course the fact that the FDA is willing to accept data over normal exon skipping agents and they mentioned in the letter both 44 or 45 as examples for a drisapersen full approval, full standard approval is very encouraging. It shows great flexibility. But again it's linked to that pathway 50 accelerated approval were to be given under the biomarker or accelerated biomarker pathway. And so it can expected that any data on other compounds could be combined.

However in our current planning, we will be discussing with the FDA the possibility of having that placebo-controlled study, sort of second study they asked for to have that done with PRO044. So the study whereby we will by looking at PRO044 compared to placebo, a study which then if the accelerated approval is given. On accelerated endpoint we will be looking at again the stroke and expression and six minute walk test as the most important elements in there. So that is the goal of that second confirmatory study and I will leave it up to Giles to get some more comments on the possibility to perhaps share with the FDA more data of other programs as such.

And by the way before Giles will start, we do have currently four compounds in the clinic. So it is in the drisapersen, PRO044, PRO045, and PRO053. So we have a number of compounds which we can choose from. But based on the advancement of the data and the status currently of PRO044, we feel that PRO044 would be the most likely candidate to discuss with the FDA for that second confirmatory study. Giles, any comments from your side.

Giles Campion

Thank you, Hans. Yes as you indicate the likely candidate to provide the confirmatory evidence to the FDA is PRO044. But as you indicated we have two other programs PRO053 and also PRO045, which are in the midst of ongoing dose ranging studies. In terms of the end points there is a mixture of both clinical endpoints but also drisapersen another biomarker end points as well as imaging. So we anticipate that the results that will be available by the end of this year and also that the first quarter of next year will involve those particular end points. And the FDA has indicated in their communication the ability to potentially supplement information through the course of the study. So it may be this information may also be helpful.

Paul Matteis - Leerink Partners

Okay. Great, thank you, and then one more and then I will let others get after. Just wondering as of right now how many options and warrants you have outstanding and what the accounts receivable balance left over from GSK that you have to collect that was part of your year-end cash balance for this year? Thanks again.

Berndt Modig

Yes, Paul, it's Berndt. The net receivable from GSK is €2.4 million and the outstanding options is about approximately 2 million shares.


Thank you. The next question is coming from the line of Yaron Werber with Citi. Please proceed with your question.

Unidentified Analyst

Hi, this is actually Kenneth on for Yaron this morning. Congratulations on the progress and the advancement of your other drugs. A quick question about the re-dosing. Was this something that the FDA had wanted for approval or was this just getting more data that's going to be supplemental to your filing?

Hans Schikan

Yes, thanks for that question, Kenneth. No, the FDA has not indicated anything about request for re-dosing. This request really came from the patient community, from the parents of the boys who were in the previous GSK trials throughout the many months that GSK and Prosensa have been working on the analysis of the data and also when we got the data and the rights back from GSK we have received numerous letters from parents that the really would like to see their boys go back on dosing, and that's why we are doing it.

So it's really that patients who either were in clinical trials or extension trials I should say or who were expecting to go into extension trials of previous participation those patients we are initiating to re-dose starting that by the end of September. And of course the aim will be to have as many patients as possible in that program but that's quite an exercise which we are undertaking here, but it's not an FDA requirement; it's really an initiative from the company based on the requests from parents and patients.

Unidentified Analyst

Terrific. Actually if I could squeeze one more in on the IP announcement that you made, I was wondering if you could provide any clarity on the difference in the following dates of the patents in U.S. relating to exon 51 skipping just so that we can have some sort of senses of how serious Prosense is here.

Hans Schikan

Yes, I will give that question to Luc, but as Luc indicated we are the senior party in both these interference cases and Luc will give some more color on the time limes there.

Luc Dochez

Yes, thank you, Hans. The filing date is significantly earlier as both patents and patent applications are licensed from university. This goes back way in time. And at this moment I would prefer not to provide any detail except I can quote the patent and patent numbers that are relevant here. So people can make their own judgment. As you know, any patent procedure is confidential in terms of strategy. So I prefer not to go into too much detail but the relevant patent numbers are for the Prosensa allowed U.S. application; its number 13550210 and two Sarepta U.S. patents relevant in this procedure are the numbers 7807816 and 7960541, but they would like to retreat as I said earlier that there is a significant difference in the filing dates.

Unidentified Analyst

Terrific, Luc. Congratulations on the quarter and the new IP landscape it sounds like you are going to enjoy. Congrats again.


Our next question is coming from the line of Christopher Marai with Oppenheimer. Please proceed with your question.

Christopher Marai - Oppenheimer

Hi, good morning, thanks for taking my questions. The first question I think is really regarding (inaudible) and the EU. And specifically I am wondering if you guys have looked at potential of named patient sales while you seek a conditional approval pathway or potentially while you are on confirmatory trial in the EU for a conditional approval of that product?

Hans Schikan

Yes, thanks, Chris. You request I just was referring to by many patients who want to go back on treatment in re-dosing also came from Europe evidently, and we are trying by all means to get patients back on dosing also in Europe. Now in Europe, but also in few other jurisdictions, there are possibility to generate pre-approval revenues by means of systems like the French 18 system for example with temporary access to drugs but at the situation which is possible in many countries as well.

And then one of the first objectives of Willem van Weperen, our new chief commercial officer, will be to explore those options as well to see to what extent there are possibilities to potentially generate revenues pre-approval. But again as part of the total picture where we would like to create access to as many patients as possible but we are possible on re-dose basis of course that I believe is a two-edged sword and also good for the company. But we are exploring that. So far no concrete plans or initiatives at this moment, but it is part of our exploring to become a big commercial company.

Christopher Marai - Oppenheimer

Great, and then with respect to Brazil and other jurisdictions have you looked at -- entered this opportunity there, I mean it doesn't sound like you are going to be running future trials in some of those jurisdictions. That might take some sense?

Hans Schikan

Well, we have the ambition to become a global company and having received back the rights from GSK we indeed now have the possibility to hopefully bring drisapersen and the older exon-skipping agents to all countries and all patients in the world, but we are focusing at this moment we are on the United States and Europe to start with. Brazil is a major country in terms of patient population many new patients there as well but we are growing as a company and we can't do it all by the same time. So for that reason that let's say that not the number one priority although we would like to do the test much as we can.

Christopher Marai - Oppenheimer

Okay. And then speaking with doing everything at the same time, on exon 044, it seems like you are not clear lead here versus the competition in developing those in the clinic. I was just wondering as to what extent you are pursuing a pathway forward what there as part of your inflammatory strategy simply because you would be first to market which I think with the -- an interesting strategic advantage versus for instance the other opportunity which you highlighted which was to confirm (inaudible) potential benefit. Thanks.

Hans Schikan

That's absolutely of course the interesting aspect of PRO044 here, Chris, because by going into proceed with control study in PRO044 it might serve two purposes. One would be to support the right person under the accelerated approval of the process and to flee comply with the FDA requirements regarding staffing the confirmatory program and have these trials underway and the moment of anticipated approval but of course the owners objective would be to try to make PRO044 available to patients as strictly as possible and entering into that placebo controlled with what the outcome of these trials will be but entering into the (inaudible) control trial with PRO044 in the beginning of 2015 would allow for that dual purpose both to drisapersen as well as for patients who could be have PRO044 as a compound itself.

Christopher Marai - Oppenheimer

(inaudible) slide in more and more if I could, just may be reminded on your current drug supply for (inaudible), and then how long would it take to get up to the reasonable capacity for (inaudible)? Thanks.

Hans Schikan

Yes, we got a drug supply for drisapersen and as part of the transfer from GSK we also obtained drug substance and drug products from GSK in their possession which are (inaudible) I should say, they can be utilized immediately for our clinical trial purposes. At the same time, the contract manufacturing organization which we used to work with in the past before we went into a collaboration agreement to GSK and that contract manufacturer then took over not the rights of the collaboration with GSK and now we are in the process of reinitiating that with Prosensa.

So it's basically going back to one of our contract manufacturing organizations which we used to work within the past and GSK took over and now we will be working with them again, in order to secure the drisapersen (inaudible) manufacture (inaudible) quantity and also there after it can be made available to patient. So this is part of the – and we will be discussing with the FDA in our meeting later this quarter and thus in terms of manufacturing we don't see that at this movement in time as a major risk factor for the company.


Thank you. Our next question is coming from the line of Debjit Chattopadhyay with ROTH Capital Partners. Please proceed with your question.

Debjit Chattopadhyay - ROTH Capital Partners

Hey, good morning and thank you for taking the questions and congratulations on all the incremental progress being made there. Quickly on dirsapersen open label study, the patients that you are currently thinking of re-dosing, how many of those patients do you think could potentially qualify for the open label study? And would you then a need to obviously take them off the drug for a while before they can be readmitted into the open label study going to be half-life of the drug?

Hans Schikan

Yes, I'm glad give this question to Giles, Debjit, and thanks for that question, but let me before Giles takes over repeat again what I just mentioned. We goal of re-dosing patients is not necessarily to generate detail for the purpose of our dirsapersen filing. We feel that based on expectations by the parents and the patients in previous GSK trials that re-dosing in that patient population should be achieved as quickly and as swiftly as possible. So it's very likely that we will be doing these things in parallel re-dosing patients under compassionate use, expanded access, or lighter protocols, and at the same time then have an open label study where we compare patients versus placebo. So it's not necessarily that those patients will then be the subject in that open label study.

But Giles, may be you can give some more color there as Chief Medical Officer.

Giles Campion

Thank you, Hans. Yes, I would only just repeat what you said in that the re-dosing has a specific goal to allow individuals that were previously been on the drisapersen program to have access to drug as quickly as possible since this is clearly what they have been looking for. The confirmatory study with the U.S., for the U.S. accelerated approval pathway will occur in parallel and will involve sites both in the U.S. and in Europe and elsewhere as we speak. Clearly as far individuals that fulfill the criteria that are part of the drisapersen re-dosing program that have been on placebo then they will be considered but as Hans indicated this is a parallel path.

Debjit Chattopadhyay - ROTH Capital Partners

On the open label study that's being planned has the FDA provided any guidance in terms of the duration of the study the choice of the primary endpoint or whether if you would be collecting any biopsies during the study at all?

Hans Schikan

And well, Debjith, the guidance which we received from the FDA so far is the guidance which was written in the letter, which we received on the 2nd of June. In the meantime we had no interactions but we've also been working hard on the design of both studies, both the open label study and the placebo-controlled study and we will be discussing these with the FDA with the aim to start these studies early 2015 so that they are underway at the time of anticipated approval.

But the FDA have not given any clear or well clear guidance on what exactly they expect in terms of duration or in terms of endpoints or inclusion criteria. That is up to us to then discuss with the FDA and get these trials underway early next year.

Debjit Chattopadhyay - ROTH Capital Partners

Awesome. And one more thing on the exon 44 which is now your second lead candidate. Do you, I mean at drisapersen at six minutes per kg, but can you go substantially higher than six minutes per kg with the 44 candidate?

Hans Schikan

With PRO 44 we are actually planning also two studies. One is an extension study for the boys who were in the previous dose findings studies and the original plan was there to go up to nine milligrams per kilogram for the boys on PRO044. And then we have the placebo-controlled study which may serve this dual purpose to one to support the drisapersen accelerated approval, 50 accelerated approval pathway is based on certain endpoint, and secondly, with the purpose to generate data for PRO044 itself. So that is the situation right now. The plan for the extension trial would be critical up to 9 milligrams per kilogram so yes higher that's a short answer.


Thank you. Our next question is coming from the line of Jan De Kerpel with KBC. Please proceed with your question.

Jan De Kerpel - KBC Securities

Yes, hello, thanks for taking my question as well and also congrats on the progress made. I have one question in fact on the IP situation coming (inaudible). If you could just clarify a little bit more the next steps that will be taking place with regards to the PDO. Could you then by the way long-term -- despite this decision has been made. And could you also clarify a little bit more the scenario analysis that you provided in one case where a person delevers on and you stated that it would be a competitive advantage on Prosensa in one case and another good advantage in the other case? Thank you.

Hans Schikan

Thank you. And Luc will reply to this question but I want to repeat by saying that to the best of our knowledge we're feeling to operate with drisapersen as our lead compound. Luc will give you some more color on your specific question.

Luc Dochez

Yes, thank you, Hans. So on the interference procedure goes in a number of steps where you first have to submit your motions, you have a discussion with the Board of Appeal, and then that process runs on somewhere till expected mid-2015. So that discussion will be ongoing for certain period. And so that is in terms of the process. So I hope that clarifies your question.

In terms of the scenario analysis, let me reiterate what Hans said. So in the United States the outcome of the interference procedure do not negatively impact our freedom to operate. So even in the scenario where the outcome is negative, we will continue to have full freedom to operate so our ability to commercialize drisapersen in the U.S. is not the impact by this.

In the other case, where the patent is above we kind of have a positive outcome of the interference procedure it will create a strong environmental position in the U.S. as well for Prosensa. I hope that clarifies your question.


Thank you. We do have a follow-up question coming from the line of Paul Matteis with Leerink Partners. Please proceed with your question.

Paul Matteis - Leerink Partners

Great. Thanks for taking my follow-up. I just had a couple of questions on the recent track guidance in patients with DMD. I'm wondering how has Prosensa's interaction with the DMD patients mainly evolved over time as you've transitioned the program from GSK to your soul ownership. And what were your thoughts on the recent draft guidance submitted by the patient mainly and do you think the FDA could respond with this own draft guidance for a potential adviser committee panel next year? Thanks very much.

Hans Schikan

Yes, thanks for that long question, Paul. In the over 12 years that Prosensa has been active as a pioneer in vision, we've always been extremely engaged with all patients organization wherever in the world. And I think that the example of yesterday the fact that the long-lasting support or actually the first supporter of the company represents spending from CureDuchenne. That again is a great example of how the collaboration and I would say the partnership between Prosensa and patient organizations have taken shape over many years.

Of course when GSK was in the driver seat, we were having those complex with patient organization as well that left out all the compounds where GSK had rights. The other example is of course with PPMD where we got a grant of 200,000 gross in the second quarter, again an example of our great partnership and continuing support by patient organizations. And these are just two examples because we have many, many others where we really are great for the interactions we've had with patient organizations over time.

And not just about financials it's also about the dialogue, about understanding the disease, understanding what needs to be done in order to do a clinical trial in the best possible manner and listening to patients when it comes to the possibilities of home care treatments and offering travel support all these kind of things is where patient organizations can really help to reform the developments of these compounds.

Now we gone in these specific draft guidance you refer to of PPMD. We've been active part in that draft guidance discussion. And Giles Campion, as a matter of fact, our Chief Medical Officer, has been involved himself as well. So I'd like him to make some comments about that rollout guidance and how we think that it helps not just the company's work in this field but also the regulators to fully understand what needs to be done in order to bring this potential treatment to patients. Giles?

Giles Campion

Thank you, Hans. Yes, this has been an ongoing dialog in terms of the development of the draft guidance which actually occurred during interactions with the EMA in terms of the guidance they were developing for DMD. And very much was a collaborative process involving both the industry participants as ourselves, academicians and clinicians as well as the patient community. And the PPMD initiative very much followed on from that. And as Hans indicated, we have been involved in both processes. As we have said, with the largest clinical database in DMD we have considerable experience to bring to the party there.

I think as far as the draft guidance and the effect on any review, the purpose of the draft guidance really is to be a forward-looking statement. So the idea that it will be applied to the development of drugs as from this moment on, and its designed to be broad both in terms of the type of the mechanism of action. So the guidance will relate both to exon-skipping approaches as well as others, but it's principally a forward-looking document.

And yes, this is being submitted to the FDA; a copy was also submitted to the EMA, so both organizations now are taking a look at that. But I think it really symbolizes, I mean, the initiative that was taken here really symbolizes a proactive way that the patients are committed to ensuring that the development of drugs in this space is fit to purpose.


Thank you. We do have an additional follow-up coming from the line of Debjit Chattopadhyay with ROTH Capital Partners. Please proceed with your question.

Debjit Chattopadhyay - ROTH Capital Partners

Hey, thanks again. Just wondering regarding the discussions with the EMA, now the typical turnaround time for them could be up to 13 months. Is there any way to expedite that process to get drisapersen on the market faster?

Hans Schikan

Yes, Debjit, timelines in Europe and in United States are indeed different, and there are possibilities to allow for earlier access in a number of European member states by means of pre-approval mechanisms, and sometimes even under re-endorsements. Of course, that can never take the shape that all patients can be treated, but really where physicians feel that patients are in dear need of a product which is not yet approved then there are possibilities to get these drugs to patients earlier. But unfortunately we can't the change the timelines as they are, but we will work as quickly as possible to get our file to the European regulators hopefully shortly after a submission to the FDA. So that’s what we can do from our side to prepare a file which can go to EMA as quickly as possible.


Thank you. It appears there are no further questions at this time. I would now like to turn the floor back to management for concluding comments.

Hans Schikan

Thank you very much, operator. And then given the fact that we are overtime already, I just would like to conclude with a couple of statements. One, we are on track for filing in the U.S. by the end of this year and we anticipate filing in Europe soon thereafter. It’s a major exercise and the company is fully committed to make this happen as quickly as possible. Patients deserve it; we are working very, very hard to get our files ready in time.

Secondly, initial re-dosing is also on track with the first patients going back to drisapersen before the end of September and hopefully many more can follow soon thereafter.

And thirdly, we are actively engaged in our pre-launch efforts anticipating a potential accelerated approval and hopefully in due course conditional approval in Europe as well. We are preparing for making drisapersen and our other compounds in our DMD portfolio available for as many patients as possible.

And that’s where I'd like to conclude this earnings call for today, and thank you for your interest in Prosensa.


Thank you. Ladies and gentlemen, this does conclude today’s teleconference. We thank you for your participation and you may disconnect your lines at this time.

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