AMAG Pharmaceuticals Inc. Q1 2010 Earnings Call Transcript

AMAG Pharmaceuticals Inc. Q1 2010 Earnings Call Transcript
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AMAG Pharmaceuticals Inc. (AMAG)

Q1 2010 Earnings Call

April 27, 2010 04:30 pm ET

Executives

Amy Sullivan - IR

Brian Pereira - President and CEO

Tim Healey - SVP of Commercial Operations

David Arkowitz - CFO and CBO

Analysts

Mark Monane - Needham & Company

Matt Roden - Banc of America

Yaron Werber - Citi

Eun Yang - Jefferies

Chris Raymond - Robert W. Baird

Geoff Meacham - JPMorgan

Adam Cutler - Canaccord

Joseph Schwartz - Leerink Swann

Presentation

Operator

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Good afternoon my name is Tracey and I will be your conference operator today. At this time I would like to welcome everyone to the AMAG Pharmaceuticals first quarter financial results conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question-and-answer session. (Operator Instructions). Thank you. Amy Sullivan, you may begin your conference.

Amy Sullivan

Thank you Tracey. Welcome to the AMAG Pharmaceuticals conference call to discuss our first quarter 2010 financial results. I would like to remind you all that we are using slides today for that call and the slides are available on the Investor Section of our website at www.amagpharma.com. Before proceeding with this call, please keep in mind that this conference call will contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Any statements contained herein which do not describe historical facts including but not limited to. Statements regarding the significance of the market opportunity for Feraheme and our Feraheme development plans are forward-looking statements which involve risks and uncertainties that could cause actual results to differ materially from those discussed in such forward-looking statements. For a full list of risks and uncertainties associated with our business, please refer to our filings with the Securities and Exchange Commission including our annual report on Form 10-K for the year ended December 31, 2009.

On slide three, you will see the agenda for our call beginning with our President and Chief Executive Officer Brian Pereira who discuss some of AMAG's accomplishments today. Tim Healey our Senior Vice President of Commercial Operations will then share his perspective on the commercialization of Feraheme. David Arkowitz our CFO and Chief Business Officer will follow with the review of our financial results for the quarter and Brian will close the prepared remarks for the call before we open the floor for Q&A.

I will now turn the call over to Brian.

Brian Pereira

Thank you, Amy. And thank you to those of you who have joined us this afternoon. I will begin with slide five. We've had a very busy few months to begin 2010 and I am proud of our accomplishments to-date. In 2010, we've already made significant progress towards our objectives for the year.

We are continuing the successful commercialization of Feraheme in the US CKD market. This is evidenced by the significant 57% increase in provided demand and utilization over the fourth quarter of 2009. In addition, we have [grown] our presence in the hospital and hematology segments, two segments that we have targeted for growth. Tim will discuss this in greater detail.

Another major objective for 2010 is to expand the global reach of Feraheme. Their partnership with Takeda marked a major step forward on this front as they bring commercial expertise in specialty pharmaceuticals in the major ex-US territory where they will be responsible for the commercialization of Feraheme.

We believe that this deal brings tremendous value for our shareholders. Between the financing that we completed in January and the upfront payment received from Takeda in April. We are now well capitalized to achieve our goals in the foreseeable future.

To provide AMAG with further commercial expertise in global specialty markets, we today announce the appointment of Gary Zieziula to the newly created role of Chief Commercial Officer. Gary is with us today and be happy to answer any questions about his expertise and the strength he brings to AMAG.

I will now turn the call over to Tim.

Tim Healey

Thank you, Brian. On slide seven, you can see that we reported $13.1 million in Feraheme net product revenues for the first quarter of 2010. This included 2.2 million in previously deferred product revenues related to our large incentive program. This 2.2 million reflects actual Feraheme utilization by our customers in the quarter as reported to us. We look at the first quarter of 2010 as compared to the fourth quarter of 2009; we achieved a 57% increase in provider demand and launch incentive program utilization with continued growth across both dialysis and non-dialysis CKD utilization.

The marked increase in provider demand in the first quarter did not translate into a significant increase in Feraheme revenues as compared to last quarter because Feraheme inventory levels on a grand basis their wholesalers and distributors were essentially unchanged from December 31, 2009 to March 31, 2010. David will discuss this topic in more detail later on this call.

For the quarter approximately 60% of provider demand was outside of the dialysis setting with hospitals and hematology clinics representing the majority of non-dialysis demand. Through April 2 of 2010 approximately 1700 providers had purchased Feraheme, with 67% of those providers having purchased on a repeat basis.

In the first quarter alone more than 585 providers purchased Feraheme for the first time, 75% of which were hospitals or hematology clinics, this is great progress. And our goal is to grow the number of hospital and hematology clinics using Feraheme substantially during the course of 2010. We believe the best indicator of success for Feraheme is to look at quarter-over-quarter growth in provider demand.

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