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InterMune's CEO Discusses Q2 2012 Earnings - Earnings Call Transcript

On the call today are Dan Welch, InterMune’s Chairman, Chief Executive Officer and President, and John Hodgman, our Chief Financial Officer. Joining us for questions and answers will be Giacomo Di Nepi, our Managing Director for Europe, and Dr. Markus Leyck Dieken, our country manager for Germany.

I will now turn the call over to Dan Welch.

Daniel Welch

Thanks Jim, and thanks everyone for joining us today. With that, we have two important topics to share with you today: the completion of price discussions for Esbriet in Germany as well as our quarterly results. I’ll focus first on the Esbriet pricing in Germany and then cover other details related to the ongoing launch of Esbriet in Germany, including market dynamics, epidemiology, underlying demand, our efforts to educate physicians and assure proper selection of IPF patients. We’ll share some marketing research results and other important aspects of the launch. John Hodgman will then cover our financial results.

We’re very pleased to report that we have achieved a successful and early conclusion of our negotiations concerning the reimbursed price of Esbriet in Germany. As you know, Esbriet is our product market in Europe for adults with mild to moderate idiopathic pulmonary fibrosis, or IPF, a chronic and uniformly fatal disease. Since the confirmation of Esbriet’s benefit by the G-BA on March 15 of this year, we’ve been engaged in negotiating the price of Esbriet in Germany with the Umbrella Organization of the Sick-Funds, the entities that reimburse the cost of medicines in that country. Negotiations were expected to be concluded by September 15 but were completed early as we reported today.

Effective September 15 of this year, the Esbriet gross ex-factory price will be €32,142.00 or about $39,000. Net of the mandatory 16% rebate imposed upon all medicines marketed in Germany, the Esbriet price will be approximately €27,000 or about $33,000 per patient per year at current exchange rates. This represents an approximately 10% discount from the price at which Esbriet was launched in Germany in September of last year. The duration of the pricing contract with the Sick Funds is for two years until September 15, 2014 or when the total cost to the healthcare system in Germany reaches €50 million in any 12-month period, at which time the price of Esbriet will be revisited.

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