Isis Pharmaceuticals's CEO Discusses Q1 2013 Results - Earnings Call Transcript

| About: Ionis Pharmaceuticals, (IONS)
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Isis Pharmaceuticals, Inc. (ISIS) Q1 2013 Earnings Conference Call May 7, 2013 4:30 PM ET


Stan Crooke – Chairman & CEO

D. Wade Walke - Executive Director, Corporate Communications and Investor Relations

B. Lynne Parshall - Director and COO

Beth Hougen - SVP and CFO


Nicholas Bishop - Cowen and Company

Chad Messer – Needham & Company

Andrew Goldsmith - Canaccord


Good afternoon and welcome to the ISIS Pharmaceutical’s First Quarter 2013 Earnings Conference Call. All participants will be in listen-only mode. (Operator Instructions). Please note, this event is being recorded. I would now like to turn the conference over to Dr. Stanly Crooke, Chairman of the Board and CEO. Please go ahead, sir.

Stan Crooke

Thank you. Good afternoon and thanks everyone for joining us on today’s conference call to discuss our first quarter of financial results. Our agenda for this call is first, Beth will walk you through our financials, Lynne will then review our current partnering accomplishment and then I will close the call by focusing on some of the upcoming data events. We also announced just a few moments ago that we were initiating a public offering of our common stocks, however, we will not be discussing financing on this call today.

Joining me on today’s call are Lynne Parshall, Chief Operating Officer; Beth Hougen: Chief Financial Officer; and Wade Walke, Executive Director of Corporate Communications and Investor Relations. And now Wade, will you read our forward-looking language statement, please?

D. Wade Walke

Thank you, Stan.

A reminder to everyone that this webcast includes forward-looking statements regarding the financial outlook for Isis, business and financial plans and a therapeutic and commercial potential of Isis technology, and product, and development. Any statement describing Isis’ goals, expectations, financial or other projections, intentions or beliefs including the commercial potential KYNAMRO is a forward-looking statement and should be considered an at-risk statement. Such statements are subject to certain risks and uncertainties, particularly those inherent in the process of discovering, developing and commercializing drugs that are safe and effective for use of human therapeutics and in the endeavor of building a business around such drugs. Isis’ forward-looking statements also involve assumptions that they can never materialize or prove correct, could cause its results to differ materially from those expressed or implied by such forward-looking statements. Otherwise these forward-looking statements reflect the good faith judgment of its management; these statements are based only on facts and factors currently known by Isis. As a result, you are cautioned not to rely on these forward-looking statements. These and other risks concerning Isis’ programs are described in additional detail in Isis’ Annual Report on Form 10-K for the year-ended December 31, 2012, and its most recent Quarterly Report on Form 10-Q, which are on file with the SEC. Copies of these and other documents are available from the company.

As Stan mentioned, we announced plan to commence stock offering today. Due to legal constrains, we will not be discussing or answering questions about the composed financing on this call. I will direct you toward filings with the SEC for more organization.

Now, I will now turn the call over to Beth to discuss the financial results for the first quarter of 2013.

Beth Hougen

Thank you, Wade.

Good afternoon everyone and thank you for joining us. I am pleased to report that we are profitable in the first quarter with pro forma operating income of $4.5 million and pro forma net income of $1.2 million. In addition to ending the quarter with both operating and main income, we only used about $2 million net during the quarter and ended the quarter with approximately $372 million. We were able to achieve these financial results because of the success of our partnership with Genzyme and GSK from which we earn $32.5 million in milestone payments in the first quarter. We have continued this momentum into the second quarter.

We’ve already received a $30 million upfront fee promotes for our Huntington in this program. And we have additional opportunity in promotes of payment from partners during this quarter and throughout the rest of the year. Our profitability in the first quarter exemplifies the effectiveness and success of our business strategy which provides us with a steady stream of revenue.

One component of our revenue is milestone payments we received from our partners. As our partner drug progressed to later stages of development, the milestone payments we are eligible to receive generally increased. While we have not yet reached the sustainable profitability, other pipeline continues to mature, we have the opportunity to earn milestones payments that can make us profitable. We received a $25 million milestone payment from Genzyme, upon KYNAMRO approval in the United States. With KYNAMRO on the market in the U.S. we are looking forward to earning commercial revenue from our profit sharing arrangement, for KYNAMRO in the future.

We also received a $7.5 million milestone payment from GSK related to the initiation of a Phase 3 study for ISIS-TTRRx has potential to earn more than $230 million in pre-commercialization payments from GSK including up to an additional $50 million as the ongoing phase three value progresses.

With numerous successful partnerships encompassing multiple drives, we are continuing opportunities to earn additional milestone payments from our partners as we progress through the year. For instance, we expect to earn a $3.5 million milestone payment from Biogen Idec this month when he dose the first Phase 2 spinal muscular atrophy study. This is the first to four payments that total $18000, we are eligible to earn every progressive Phase 2 and initiate the pivotal study in Isis, which we plan to began early next year.

New corporate product transactions we initiated are another component of our revenue. The upfront fees were received from these transactions are amortized over a period of time, creating revenue. We recognized new revenue from the amortization of the $25 million upfront payment from AstraZeneca and the $30 million upfront payment from Biogen Idec. Whole chains are to be completed in December of last year. Our financial results for the first quarter do not include new revenue from the amortization of the $30 million upfront payment from Roche for our Huntington collaboration which will began to recognize into revenue in the second quarter.

In addition to bringing in significant new revenues this quarter, the prudent management of our expenses also contributed to our strong financial results. Our expenses were eventually flat compared to the first quarter last year, despite the fact that our pipeline continued to advance. We also realized financial benefit from our satellite company strategy which expands our investments beyond our pipelines into other therapeutic areas in which antisense offer unique opportunities to treat disease. Because we often take equity position in these companies we have multiple opportunities to benefit at as these company’s mature.

For example in the first quarter we realized a gain of more than $1 million from selling our equity in Sarepta Therapeutics. In addition, we are a significant shareholder in Regulus Therapeutics which is the company we co-founded with Alnylam to develop antisense drugs directed to micro RA. The value of our investments in Regulus has increased more than $10 million in the first quarter of 2013, as the market value of Regulus just started to increase. W are looking forward to Regulus advancing first antisense drugs targeting micro RA.

Plus you can see we are indeed off to an excellent start for 2013. We exceeded expectations and ended the quarter profitable. Our achievements have provided the momentum to position us for continued to success this year and we remain on track to meet our financial guidance for the year. And now I would like to turn the call over to Lynne.

B. Lynne Parshall

Thanks Beth. 2013 has gotten off to a great start with the highlight being the approval and commercial launch of KYNAMRO in the United States to treat patients with homozygous FH. Genzyme’s commercial launch is going very well. And many patients call physicians qualified under the REMS program and there is a granting reimbursement for KYNAMRO and there are a number of scripts written.

It is to provide a lot of granularity about this progress but we are excited about the commercial potential of the KYNAMRO. KYNAMRO is the first systematically administered antisense drug for chronic disease to be approved and then the combination of many years of hard work perseverance and scientific achievement. The rest of our pipeline beyond KYNAMRO is also progressing very well.

Since the beginning of the year, we reported positive Phase 1 clinical data in clinical data in children with spinal muscular atrophy and positive data in endotoxin challenge with ISIS-CRP Rx. We initiated three important clinical studies already this year. A Phase 3 study for our triglycerides patients with Transthyetin Amyloidosis and multiple dose study in infants with spinal muscular atrophy and Phase 2 study micro STAT3 Rx in patients with liver cancer.

With the pipeline of 28 drugs, certain drugs that could reach the market by 2017, 9 drugs that will report Phase 2 or Phase 3 data in the next year or so, and a host of promising earlier-stage programs we have numerous opportunities to showcase the advances in the pipeline and the productivity of our NSM drug discovery platform.

It’s a testament to the efficiency of our technology, we can generate an advance pipeline with so many drugs and so many different therapeutic areas. Our partnering strategy builds on the efficiency of our technology to maximize the value of our pipeline by partnering each drug as a most appropriate patient development to optimize its value. Because of the success of our current partnerships and the significant interest in partnering with Isis, we are being very selective of the types of deals we do and the partners we chose.

We generally enter into one or two types of partnerships, the first type we call a preferred partner arrangement. We use this type of the partnering arrangement for earlier stage programs to ensure that we get benefit of our partners experience while maintaining control of early development while retaining a significant portion of the commercializing of the drug. Partnerships we formed in neurological disease and cancer are examples of preferred partner transactions.

Our neurological disease and cancer franchises are two areas in which we felt early partnerships could bring significant value. Our goal last year high-quality partners for these programs. We successfully accomplished this call. Before three partnerships with Biogen Idec, further send neurological diseases including spinal muscular atrophy. (inaudible) ISIS-STAT3Rx and a research collaboration that builds on AstraZeneca's Cancer Biology Network. Last month we initiated a partnership with Roche for Huntington’s disease program.

We are already realizing the value of these experience, knowledgeable and committed partners together with Biogen Idec, we will be able to rapidly advance our SMA drug. Last month we announced we have begun Phase 2 study in infants spinal muscular atrophy. We are on track to start two registration directed studies early next year, one in infants and one in children with SMA. The support from SMA community in Biogen Idec for this program has been exceptional and has enabled us to study more this track thoroughly and move it forward more rapidly and we would have been able to do on our own.

In addition together with AstraZeneca, we began to implement a right development program to evaluate the activity by ISIS-STAT3Rx in a number of different type of cancers. We’re, studying ISIS-STAT3Rx in the Phase 2 study and patients with the advance lymphoma and AstraZeneca just initiated a second Phase 2 study in patients with liver cancer.

Our partnership with Roche for Huntington’s disease program further highlights the level of interest in partnering with Isis. Developing antisense drugs is an exciting commercial opportunity. Our earlier work in this area suggests that antisense treatment could have profound effect on the disease in these patients. Because of the increasingly visible performance for antisense drugs from clinic, the industry interest in our technology is overwhelming.

Numerous pharmaceutical companies’ approached us about licensing the Huntington’s disease program after publication of our preclinical data. We felt Roche was the right partner to help us navigate through the complexity of this disease and enable us to develop the best drug or drugs to treat these patients. We are very pleased we’re working together with them to move this program forward.

In addition to these preferred partner arrangements, our strategy includes transaction that allow us to retain certain drugs into later in clinical the development before partnering. These drugs like ISIS-CRPx, will typically have a relatively straight forward and compelling opportunity to show proof of value in Phase 2 that could require a large complex and expensive Phase 3 program by creating clinical data to support the value of the drug before partnering, we believe we can maximize the value of these drugs, while minimizing the expensive risk of late stage clinical development.

With the successful performance for our technology in pipeline, strong collaborations in place and numerous reason in near-term clinical milestones we think now is the right time to take the next step in evolving our business strategy. We plan to do this by keeping some of our drugs into late stage development including into or even through Phase 3 clinical studies thereby creating a more valuable data package and derisking remaining activities to move the drug on the market in turn allowing us to obtain an even greater portion of the commercial revenue when we eventually partner them.

We have number of drugs in our pipeline that we’re considering keeping longer and these were generally fits in common criteria. We started to focus on smaller orphan or orphan like diseases in which we think antisense technology has the opportunity to offer unique benefit but we focus when indications were smaller less expensive and a faster clinical trials can be conducted. Preferability drugs will focus on indications in which Phase 1 and Phase 2 data may predict the results of Phase 3 result. That’s allowing the program to be derisked early in development.

In other words, features will be evaluated in clinical trials we can manage well and in which we expect to obtain the most information possible early to guide later stage development.

In addition to this clinical focus and areas in which we developed significant internal expertise to help ensure success of the clinical programs. For example, we consider drugs for therapeutic areas for which we not only understand the disease, but also notably in physicians who can work with us in conducting the trials. A good example of the drug meeting these criteria is ISIS-APOCIIIRx. This is antisense drug designed to patients with severely alleviate triglyceride. With KYNAMRO we gained valuable experience in designing and conducting clinical trials and with the disorders. And the same list of specialists that we work with to develop KYNAMRO will also be working on to develop ISIS-STAT3Rx. In Phase 1 clinical trial, we showed that ISIS-STAT3Rx significantly lower both APOCIII and triglycerides. We hope to replicate this data and patients with severely elevated triglycerides in our two ongoing Phase 2 study. It’s under the theory of the disease and the last of the triglycerides lowering agents for the patient population, we believe we will be able to move ISIS-STAT3 Rx rapidly through Phase 3 clinical study on our own because the patient population is at severe risk for both cardiovascular events and pancreatis, we also believe that a rapid less expensive registration pathway is possible.

We plan to initiate our registration directly to Phase 3 program early next year after discussing our plans with regulators. We could pursue a similar strategy with ISIS-STAT3Rx, a drug designed to reduce another (inaudible) risk factor of (inaudible) which also contributes to elevated cardiovascular risk in a subset of patients who were in need of a targeted therapy. And of course there are other drugs in our pipeline like (inaudible) and drugs that will enter our pipeline in the future that we expect (loss) of this criteria. (inaudible) is a drug that just entered our pipeline in January its an antisense drug designed to reduce the incidence and severity of attacks in patients who have Hereditary Angioedema. Hereditary Angioedema is a rare genetic disease characterized by rapid painful and potentially fatal attacks of severe edema which were caused by an inflammatory response. Because the current treatment for severity limited with major tolerability issues, (inaudible) therapeutic options for this potentially fatal condition. We believe that I can speak of KRX could offer for the first time and effective way for patients to control these attacks.

In addition, we believe that the development (inaudible) could be rapid and relatively straight forward (inaudible) an ideal drug for us to consider retaining longer. So, with that I’ll turn the call back over to Stan.

Stanley T. Crooke

Thanks Lynne.

We are continuing to deliver all the promise of antisense. We believe that the value of antisense technology in our pipeline is just beginning to be realized. Our retaining select drugs in our general pipeline longer, we believe that we’ll be able to participate more in the commercial success of these drugs. As Lynne mentioned, we have a number of successes already this year, KYNAMRO approval has gotten a year off to a great start, gaining approvals for a drug by the FDA for chronic use is the most challenging and rewarding task in drug development. It’s a goal that we’ve worked toward for many years and it’s the beginning of what we hope will be many, many more Isis drugs to reach the market.

In addition to our successes in partnering our pipeline continues to advance as exemplified by very recent clinical activities. We report the positive data in children with spinal muscular atrophy demonstrating that ISIS-SMNRx was well tolerated at all those levels. In addition, concentration drug in the cerebral final fluid were consistent with levels predicated by our pre-clinical work suggesting that dosing could be (inaudible) as every six to nine months. Although this study was not designed to provide evidence of activity and it was just a single dose we absorbed improvements in the Howard Smith a functional motor score which is a scale that’s used to evaluate motor performance or muscular performance in these children.

We currently evaluating this drug in (inaudible) clinical studies one in infants and one in children with SMA we find the report these data from these studies made in 2013, 2014. AstraZeneca broaden the evaluation of ISIS-STAT3Rx in the patients who have lever cancer, the study is getting underway, we’re also evaluating ISIS-STAT3Rx in ongoing Phase 2 study in patients with advanced lymphomas. We plan to report data from the Phase 2 lymphoma study early next year. We report a positive (inaudible) ISIS-CRPRx demonstrating for the first time that our growth could selectively belong to bear increases in CRP and human beings.

We published data in circulation search demonstrating that antisense inhibition of APOCIII produce significant reduction of APOCIII and triglycerides in multiple animal models and in human beings. We plan to continue this momentum with the number of near term data advance that we will be sharing with you throughout the summer. We plan to report data from our Phase 2 study evaluating ISIS-CRPRx action patients with the rheumatoid arthritis. This is the first study in which the direct effect of selectively lowering CRP will be evaluated in a disease setting in which CRP is chronically elevated

We also plan to report data from Phase 2 studies evaluating our (inaudible) triglycerides lowering drug ISIS-STAT3Rx in patients with rheumatoid arthritis. This is the first study in which the direct effect of selectively low NCRP will reevaluated in the disease setting in which CRP just chronically elevated. We also planned to report data from Phase 2 studies evaluating our novel triglyceride lower drug APOCIII Rx in patients with elevated triglycerides.

In summary, we believe that the value of Isis, our technology and our pipeline is just beginning to be recognized and look for the drugs that we have in development and the milestones that we set to achieve, we expect that momentum to continue.

And with that, I will thank all of you for joining us on the call of today and we will now open up the call for Q&A Denise, if you can set us out please.

Question-And-Answer Session


Thank you, sir. We will now begin the question and answer session. (Operator Instructions) The first question will come from Nicholas Bishop of Cowen and Company. Please go ahead.

Nicholas Bishop - Cowen and Company

Hi, good evening and thanks for taking my questions. The first one is on the SMA trials, the one that you are about to initiate in infant patients, when you get the point of transitioning between Phase 2 and the Phase 3, do you expect to disclose data from that first Phase 2 portion, and I guess the same question for the (inaudible) patients or we want the data closure plans B from the Phase 2 be (inaudible)?

Stan Crooke

We do plan to disclose the data and we expect to be able to discuss later from those two trials, late this year and early next year.

Nicholas Bishop - Cowen and Company

Okay, great. Next we are then on the CRP program, I understand you could explain a little bit about the outcomes you are looking at with that you believe would, which poof of concept in an indication like RA by assuming don’t expect a significant ACR20 responses. So, just what the outcomes you are looking out there?

Stan Crooke

The primary endpoint in all the Phase 2 trials is CRP reduction of course. But rheumatoid arthritis study we are looking at slightest symptoms of rheumatoid arthritis including all components that make up ACR20 to ACR50s joint count of physician assessment, patient assessment. And what we hope to see is at least trend in a favor of the drug with a correlation between the reduction in CRP and suggestions of improvement and disease. Obviously, as their study progresses and complete we will be able to analyze data and present it.

We are looking at several doses with top dose 300 to 400 milligrams a week. So another thing that we will be looking at is tolerability. Remember that this CRP drug is exemplary of this new crop of generation 2 drugs. Same chemistry as KYNAMRO and earlier generation 2 drugs for the better screening, advances and screening have allowed us to generate drugs that appear to be at least twice as potent as KYNAMRO and significantly better tolerating. So another thing that (I’m crazy) to pay attention to is, how we feel about the side effect profile of the drug?

Now, the atrial fibrillation study which is in progress and will be reported this year, but sometime next year, is similar and they will be looking at the ability to reduce CRP in patients who have elevated CRP and we will be monitoring these patients with – (inaudible) patients who have such severe recurrent atrail fibrillation that they have pacemakers. And so we are monitoring the incidence of requirements for pacing prior to drug during drug treatment and then after drug is discontinued in that study. And again, we hope for, as these are notably small Phase 2 trial, at least trends that support the drug maybe active in the treatment of that problem.

Nicholas Bishop - Cowen and Company

Okay. That’s great.

Stan Crooke

Did it answer the question?

Nicholas Bishop - Cowen and Company

Yeah, that’s very helpful, thanks a lot. Just one last one, I think I will get back in the queue and STAT3 program. Just wondering, if you will see any data updates and how is going that program and then a second question is, if you can talk about why (inaudible) was selected as sort of the first indication and what the other high promise indications in the STAT3 (inaudible).

Stan Crooke

I don’t think we are presenting anything at ASCO this year, you will recall that we did present top-line data from the earlier experience that we had in lymphoma. But that studies are going well and we too expect to be able to report to results of that study in the not too distant future. The choice of liver cancer was a choice made jointly by ISIS and AstraZeneca and it’s based on the biology, STAT3 is thought to be activated in many of these patients and to be a real driver in the disease and need, there is still a great need for improved therapy in ACC. And of course, what you want to expect is that we and AZ will select additional vacations where the similar situation obtains. That is clear evidence, biological evidence that STAT3 is a major player in the cancer and clear on that medical need that we think STAT3Rx can meet.

Nicholas Bishop - Cowen and Company

Okay, great.

B. Lynne Parshall

Stan may I answer just one little thing. I actually do think we will have data on ISIS STAT3Rx at ASCO but it will be data from the Phase 1 study not from the either of the ongoing Phase 2 study.

Stan Crooke

Oh, I’m sorry, I was wrong. Yeah, that is going to increase, but we have already seen those data that won’t much new there.

Nicholas Bishop - Cowen and Company

Okay, thanks.


The next question will come from Chad Messer of Needham & Company. Please go ahead.

Chad Messer – Needham & Company

Great, thanks for taking my question. I know one thing, I am very much looking forward to is the upcoming APOCIII data and obviously it will be important to see if you can get the decreases in patients that you saw in healthy (inaudible) but I am equally interested in seeing the safety profile of CIII and how that plays out in patents that are, you probably at more risk for problems particularly those patients on fibrates, so what safety data are we going to get in the Phase 2?

Stan Crooke

Well, we will have 13 weeks of treatment with APOCIIIRx in patients with severely elevated triglyceride and a subset of those patients who are taking fibrates. We will of course be evaluating liver safety and all the other components of safety that you would expect. The thing that I am watching because I am very confident that we will have a very well tolerated drug. Yes, these are a little harder things to (inaudible). But what I want to do is, I want to feel good about the news in side effects and just inside reactions flu like syndromes and those kinds of things. And I am not mistake that I will.

In addition, somewhat later this year, we will have data from the more routinely elevated triglycerides in-patients with Type 2 diabetes. There again what I want to see is triglyceride lowering in that study we are only looking at 300 mg. And in that study we will have the opportunity to ask if the tolerability profile, looks the same in patients who are diabetic. And I think that will be of use to know. And we will have the opportunity to evaluate whether lowering triglyceride and APOCIII might have potential benefit in increasing insulin sensitivity. We won’t have sufficient numbers to draw from conclusion about them, all we hope to do is to see some trends that suggest that they maybe another opportunity for the drug.

Chad Messer – Needham & Company

Great, thanks, looking forward to getting the data.

Stan Crooke

Okay. I am sorry we were very (inaudible) about this drug, (inaudible) about this drug. Thanks Chad.


(Operator Instructions). The next question will come from Salveen Richter of Canaccord. Please go ahead.

Andrew Goldsmith - Canaccord

Hi there, this is Andrew Goldsmith on the line for Salveen. I really don’t want to talk about the race, but maybe more generally kind of looking at your very health cash balance on the lower burn rate, you may be talking generally about, if you are also looking for assets or what you might look further?

Stan Crooke

I am not, Lynne I will let you answer that, within the limits that we have.

B. Lynne Parshall

So Andrew if as, you know, by the facts as I am talking really now it’s the right time take the next step in the evolution of our business strategy. When we look at the wealth of assets that we in our pipeline and the fact we are adding 3 to 5 new drugs every year, we really look at those drugs is fitting into as I described from 3 separate bottoms. One is drugs like I say like CRPRx, which we believe that we can take to an important phase to value, prove per value point and license them so that large pharmaceutical companies can do the long broad profiling of phase 3 and putting the drugs on the market.

If second group is drugs like antisense and NRX and our HTT program we are varying therapeutic areas that antisense drugs have not been tested in. They have other unique aspects where we believe a partner expertise can complement our own and it make sense do prefer partner relationships where we get the partner in earlier on in the program, we conduct the research and early development but our partner is participating all long way and really adding value to the program.

But we now believe that there are assets with the different set of criteria that we have the knowledge experience, confidence of the platform, confidence of the target up to take even further along through clinical development ourselves. And those are the things like it was ISIS-STAT3Rx (inaudible) drug or PKK drug where we can’t believe that we can do relatively straight forward Phase 2 studies that will be extremely predictive of Phase 3 results where we can identify certain set populations that are small enough that the Phase 3 program should be rapid and manageable, both in terms of resources and in terms of dollars and where we believe that we’ve developed the expertise and the networks and the knowledge and the relationships with KOL to move those drugs forward extremely successfully much further along and develop it, meant allowing us to retain an even larger share of the commercial outside of the drugs.

So, it, one of the nice thing is because our platform is so efficient and fills the pipeline so well. We can look at a unique partnering strategy for each drug and we believe now is the time to be able to look at a set of our assets where we’re going to keep it longer.

Stan Crooke

That’s about as much as we can answer at the moment of course we will happy to chat with you as we progress in the offering.

Andrew Goldsmith - Canaccord

Okay, wonderful. And then maybe I could just ask, do you have any kind of updates on how KYNAMRO uptake is going today?

Stan Crooke

Lynne why don’t you take that too.

B. Lynne Parshall

Yeah, the launch is going well. We have a quite number of physicians who are qualified reimbursement from payers, a number of scripts written and so we think it’s going very well. As we said at the end of the year, we think this quarter is too early to start giving handicapping and giving granularity but we are working with Genzyme on being able to do as we go through the year.

Stan Crooke

I can add that focus on age continues to go extremely well as well we’re confident, we’re going to complete that on schedule and the blinded performance of the drug continues to be very impressive to me. So, we’re looking forward to that getting done and being able to broaden the indications and get approval in Europe.

Andrew Goldsmith - Canaccord

Great. And then maybe I can just create a quick modeling question, and how you recognizing the $30 million Roche upfront, is that amortized?

Stan Crooke

Yes, any license fee is amortized over the duration of the collaboration.

Andrew Goldsmith – Canaccord

Yeah. Great. Thank you very much.

Stan Crooke

Thank you.


And ladies and gentlemen that would conclude our question-and-answer session. I would like to turn the call back over to Dr. Crooke for his closing remarks.

Stan Crooke

Thank you very much. We appreciate your continued interest. We think 2013 is off to a great start and we think the rest of the year, looks to us like it should be very much the same kind of story. Look forward to talking with you more about the progress that we’re making as the year unfolds. Thanks a lot.


Ladies and gentlemen, the conference has now concluded. We thank you for attending today’s presentation. You may now disconnect your line.

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