Camurus AB

STO:CAMX

Earnings Call Transcript 2021-Q1

[Operator]

Ladies and gentlemen, welcome to the Camurus Q1 Report 2021. Today, I am pleased to present President and CEO, Fredrik Tiberg. [Operator Instructions] Speakers, please begin.

[Fredrik Tiberg, CEO, President, Head of Research & Director]

Thank you, and good afternoon, everyone. Welcome to Camurus' First Quarter Presentation in 2021. It's been a good quarter. We'll go to the next slide, please. And of course, as always, we have forward-looking statements in this presentation. And so please read them at your own leisure. I have some technical difficulties here. So sorry about that, they are now solved.The agenda for the day includes a summary of Camurus' first quarter financial and operational results. That will be followed by an update about the commercialization of Buvidal and progress of key pipeline programs. And as previously, we will finish off with some key takeaways followed by a Q&A session.With me on the call today, I have our Chief Financial Officer, Eva Pinotti-Lindqvist; and Chief Commercial Officer, Richard Jameson. So let's move to Slide #4, an overview of the first quarter results. In the first quarter, we continued to make significant progress on key priorities. We had a strong commercial development and progress with Buvidal. We continue to expand our commercial platform in Europe and Australia with investments in Spain, France, Benelux and Switzerland. We successfully progressed our life cycle management activities for Buvidal and received new regulatory approvals as well as patents. And we continue to build the evidence base for the treatment in different treatment settings.We also made good R&D progress with the ongoing Phase III studies in acromegaly, a Phase -- FDA safe-to-proceed letter was issued for our Phase III study in neuroendocrine tumors. I'll come back to that later. And also, we had a scientific advice with the FDA on our polycystic liver disease program. In addition to that, we also had good progress in the early phase developments as well as our partnerships and R&D collaborations.Our financial performance continued to be positive with continued strong revenue growth and improved financial results, ending up in a robust cash position. The full year financial outlook could therefore be left unchanged. And with that, I'll move to the next slide, showing the development.And as you can see in the figure on the left side, our total first quarter revenues has increased strongly since the first launch of Buvidal in 2019. Compared to the first quarter in 2020, our total revenues increased by 155% to SEK 126 million, while our operating expenses increased by 16% to SEK 136 million. This resulted in an operating result overall of SEK 26 million -- minus SEK 26 million compared to minus SEK 77 million in 2020.I want to raise a finger of caution on this note, just for you to know that, of course, our R&D expenses are likely to increase over the rest of the year because of the start of Phase III programs as well as other clinical activities. Nevertheless, we have finished the first quarter with a healthy cash position of SEK 428 million. And we're maintaining our full year financial outlook that we presented in the fourth quarter report on the 11th February 2021.With this short introduction, I will now hand over to Richard for an update on Buvidal. And that is then on Slide #6. Thank you. Please take over, Richard.

[Richard Jameson, Chief Commercial Officer]

Thanks, Fredrik. So yes, just confirm Slide 6. And this is just a quick reminder about Buvidal, our flexible, weekly and monthly subcutaneous buprenorphine for the treatment of opioid dependence. It's an innovative product that provides significant benefits to patient's anxiety. Our strong evidence base has demonstrated both treatment outcomes -- improved treatment outcomes and patient satisfaction. We've shown a reduced burden of treatment and improved quality of life of patients and addressed any of the other limitations of the current daily treatments and the costs associated with those.We hear many patient stories like the one on the right from Justin, a patient in Australia, who talked in our annual report about how Buvidal has helped him support in a way out of the cycle of addiction that he didn't have with the daily treatments.So if we move on to Slide 7 and talk a bit about opioid dependence during the pandemic, the pandemic has undoubtedly had a significant impact and exacerbated the global health crisis. So this can be demonstrated on the graph on the left side of the slide, showing the serious issue with escalating overdose deaths, in this case from the U.S., and this really emphasized the need for better access to care and new treatment alternatives.I think it's widely accepted now the investment in treatment brings substantial value to society and to patients, of course, and this growing crisis is being recognized through increasing commitment from governments as they tackle these challenges. And as examples, there are 2 cases here that demonstrated significant investments being made. One, the large $1.5 billion commitment from the Biden government, what they're making in the -- specifically in the U.S. for substance abuse prevention and treatment as part of the American Rescue Plan Act. And as another example, the Scottish government hedging GBP 250 million to address the rising drug-related deaths. And as part of this policy, they directly recognized the role long-acting Buvidal can play in this response.So this brings us on to the performance of Buvidal. So please move on to Slide 8 and our launches across EU and Australia. Despite the very challenging period, in Q1, we've successfully continued to build access and penetration into our launch markets, resulting in strong growth with sales up 156% versus previous year and 20% on the previous quarter.We have exceptional market penetration in Australia and Nordics up to just 2 years and are making good progress in U.K., Germany, alongside the smaller markets. This is a strong performance in light of the pandemic, which remains a barrier for uptake and has limited our face-to-face access with clinics, though our teams continue to engage with health care professionals and other stakeholders through virtual platforms where necessary.With an estimated 18,000 patients in treatment now at the end of the quarter, we continue to receive clear confirmation of the value and benefits Buvidal brings. The importance and the flexibility to match patients' needs is clear alongside the opportunity to individualize patient -- treatment for patients -- for across treatment settings from underserved populations such as the homeless through to those more stable in treatment. While we continue to expand access to Buvidal and is now available in 15 countries across Europe, Australia and the MENA region. And we're progressing at further 8 launches in wave 3 markets during 2021.And if we can move to Slide 9, please, I can give an update on those. So in the Netherlands and Switzerland, we're in the very final stages of the reimbursement process and plan to launch as soon as possible. In France, we had a very positive outcome from the assessment by the HAS, so we're now accelerating the first phase of the launch in Q3. In Portugal, we await the outcome on our reimbursement dossier, which has been delayed by the authority due to the pandemic that this is anticipated soon. In Croatia and Slovenia, we've made reimbursement submissions, which are undergoing the country processes, and we're on track for launch in Q3. And we continue to work with our partners in the MENA region with early access programs and regulatory submissions across that area. In New Zealand, we received marketing authorization as part of our good geographical expansion and life cycle management strategy.On that point, I'll hand back to Fredrik for an update on that as we move to Slide 10. So Fredrik, back to you.

[Fredrik Tiberg, CEO, President, Head of Research & Director]

Thank you, Richard. And over to a brief pipeline update. We are now on Slide #10 here. So where we will start actually with the regulatory update on Buvidal am Brixadi in the U.S. and the rest of the world and also discuss our late-stage clinical programs with a focus on CAM2029.So over to Slide 11. As I said, we have had a very successful quarter for our regulatory team, where we received regulatory approval for Buvidal in New Zealand, we also received a positive opinion from the CHMP for approval of a new 160-milligram monthly dose of Buvidal, adding further to the flexibility for treatment providers and patients with regards to individualizing doses according to patients' needs.After the quarter, we also got an approval for the 160-milligram dose and also aligned the label in Australia with the EU label, allowing direct initiation with Buvidal weekly without the need for stabilization on daily sublingual therapy first. In addition, a number of regulatory submissions have been processed or prepared in different regions during the quarter. And we are expecting to see the first regulatory approvals coming through after the summer in MENA.In the U.S., following the December 2020 complete response letter, our partner, Braeburn, has been working closely with their manufacturer and also in close contact with the FDA to address and tackle the CRL issues. And we continue to expect a PDUFA date and approval sometime in the second quarter this year. We also was granted a U.S. patent for Buvidal, extending the patent lifetime for the weekly formulation to July 2032. Finally, our team is preparing for a market authorization application submission to the EMA for the chronic pain indication with an expected submission towards the end of the year.So with that, over to Slide #12 and an update about the clinical program for our octreotide subcutaneous depot. Before going into the -- as I mentioned, CAM2029 is designed with the aim to provide enhanced efficacy and improved treatment convenience for patients with rare and chronic disorders, including acromegaly and neuroendocrine tumors.Over to Slide #13. We have an extensive clinical program going with CAM2029, including currently 2 ongoing studies for acromegaly and as you will see later on, starting up in NET and polycystic liver disease. Recruitment in our acromegaly study has been impacted by COVID-19, but is accelerating as more and more clinical sites are opening up. And overall, we expect delays to be limited.We will now move to Slide 14 for more details on these development programs. So as I mentioned, we have 2 ongoing Phase III studies in acromegaly, a 6-month placebo-controlled randomized-controlled trial and a 12-month long-term safety study. These remain on track for NDA and MAA submissions in late 2022. And we have initiated early prelaunch activities as well in this area.During the quarter, we received a safe-to-proceed letter from the FDA, allowing us to start a third Phase III study of CAM2029 to assess the superiority of CAM2029 in treatment of neuroendocrine tumors. And following the FDA acceptance, this study is now being started. We also completed a scientific advice with the FDA regarding the clinical development in polycystic liver disease, PLD. And based on the constructive and positive feedback from the agency, we are now developing the large part of the patient-reported outcome measures, which will be an important endpoint in this study. And finalizing the protocol development of Phase II/III clinical study, which we plan to launch in the second half of this year.Finally, there's a lot of the ongoing activities in 2029. We are conducting a pharmacokinetic study, where we are comparing the data using our prefilled syringe configuration that we have used in previous studies with a new auto-injector device or as it will be referred to a prefilled-pick-pen format. This study has progressed well, and we are expecting all patients to be completing treatment in the single dose part of the study during this quarter. The prefilled pen device will be fully validated for clinical and commercial use in July this year and will be introduced also into 2 of the Phase III studies. We believe that this will be a further important differentiator for CAM2029 in the clinical setting and will greatly simplify administration and improve convenience for patients.So with that summary, let's move over to the news flow on Slide 15. So here, you can see an overview of expected news flow during the coming year. We are in the final stages of the Buvidal line extension approvals in Australia and Europe, where we are only waiting for the European Commission to give a formal approval for the 160-milligram dose.And we are also on track to deliver the remaining milestones in the first half of the year.In the second half of 2029, we are -- 2021, we are looking forward to updating on the progress of our clinical programs, as I mentioned. And also, we are waiting for the start of the registration program of the weekly setmelanotide product that is developed by Rhythm based on our technology as well as Phase II results for CAM2043 in Raynaud's syndrome. And importantly, of course, we are looking forward to the anticipated U.S. approval for Brixadi.Moving over to Slide 16, we are completing this presentation, now on my final slide. We have outlined our key strategies for value creation, both in the short and medium term. On the commercial and development side, Camurus is already the market leader with Buvidal in a few markets. And we will continue to build our leading position in Europe and Australia and expand into new markets during the coming years. In addition to that, we are looking forward to the U.S. approval, as I mentioned earlier and through that potentially becoming a leading global brand in the opioid-dependence treatment area.We have also begun our diversification on the commercial side with prelaunch activities, both in the chronic pain and acromegaly area. And we will continue investment in our R&D and pipeline development with the goal to obtain both new regulatory approvals for CAM2038 and CAM2029, but also grow our portfolio of innovative medicines in other areas of high unmet need and market potential.On the corporate side, we will look to continue building and expanding our commercial platform, where we have done excellent work up to now and add new products. And of course, we're targeting to develop sustained growth over the next few years and also profitability. I look forward to reporting on these further steps of our journey in the next quarterly call on the 17th of July.So with that said, now it is a good time for the question-and-answer session, and I will hand over to the call to the operator. So thank you, everybody, for listening.

[Operator]

[Operator Instructions] Our first question comes from the line of Peter Sehested from Handelsbanken.

[Peter Sehested, Research Analyst]

It's Peter from Handelsbanken. And let me start by apologizing the fact that I wrote in my fast comment that your revenues were up by 75%. That is of course, SEK 75 million, up by 155%. So if the share is down for that reason? I can only urge to crop and exploit the market efficiency and buy some. But nevertheless, we comment aside. Of course, the market is highly interested in knowing about the progress with Brixadi in the U.S. You do make some comments in the report. But can you say a little bit more on top of what is already mentioned in the report?

[Fredrik Tiberg, CEO, President, Head of Research & Director]

Well, yes, what I can say is that there is a good dialogue with the agency. And as I understand it, everything is progressing according to plan in terms of the response and sorting out the issues that had been raised. I do believe there is quite a lot of pressure, if I look at it from the outside on the agency at this time. But our expectations remain the same.I would also like to say that, of course, there is still a tentative approval for Brixadi in the U.S. So the further approval is, of course, just a matter of sorting out this probably response letter and other issues are -- should be noncontroversial. So we are still expecting the approval to come in the second half of the year, unless something completely different comes in terms of signals, but that's our standing now.

[Peter Sehested, Research Analyst]

All right. Have you any way and have you any measures of contracting the manufacturer and finding out what's the actual status on and progress that they are making to rectify those issues that were raised by the FDA?

[Fredrik Tiberg, CEO, President, Head of Research & Director]

I mean we are bound by confidentiality here. And to the extent we know anything, I think that what is clear is that every effort is -- this is, of course, a very important development for all parties involved, and every effort is put here. We also know, and we have had a third-party looking into the questions that were raised in the CRL. So that is public domain information. And we and our own interpretation of those consider them to be addressable within between 1 and 4 months. So we are expecting things to move forward, but I don't have any further details from this development that I can communicate now.

[Operator]

[Operator Instructions] And there are no further questions at this moment. So I'll hand back to the speakers.

[Fredrik Tiberg, CEO, President, Head of Research & Director]

Okay. With that said, I think -- I just want to thank everybody to listening into our call. It's always an important part of the year to be able to deliver the results of the quarter. And I think I want to especially thank my team for producing such a great result. And all listening in for taking the time to listen to Camurus, and I look forward to following up on the Q2 call in July. Until then, hopefully meet you in other circumstances, and have a great afternoon, everybody.