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Avanir Pharmaceuticals, Inc. (AVNR)

Citi 2012 Global Health Care Conference Call

February 29, 2012 9:00 AM ET


Keith Katkin – President and CEO


Keith Katkin

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I’d like to start with our forward-looking statements, as I will be making comments that are forward-looking in nature pertaining to our other development and commercialization of our product candidates. I’d refer everyone to our quarterly and annual filings of the SEC, available on the Avanir website, or on the SEC’s website.

Avanir is a uniquely positioned specialty biopharmaceutical company focused on CNS therapies. Our lead product compound NUEDEXTA was approved in late 2010 as the first and only therapy for the treatment of pseudobulbar affect. Subsequent to the FDA approval in late 2010, we launched NUEDEXTA in February of last year approximately one year ago, and since launch we’ve seen a steady and continued growth in both physician adoption and prescription, and I’ll get into more detail later in the presentation about pseudobulbar affect, as well as our commercial launch of NUEDEXTA.

In addition, with arguably the largest hurdle behind us, that being FDA approval, it opens up NUEDEXTA, or as we call it in clinical development, AVP-923, for a number of additional indications. Those listed on the slide include: central neuropathic pain in multiple sclerosis, behavioral disturbances in Alzheimer’s patients and a host of a number other potential indications. And many of you may have seen this morning, an announcement that we made in regards to a license agreement with Concert Pharmaceuticals, and that license agreement gave us access to their deuterated dextromethorphan, and we really view that as a next-generation dextromethorphan with the potential in all of these indications that I mentioned, and I’ll go into more detail on these indications – potential indications as well as the Concert deal later in the presentation.

Taking a quick snapshot of our pipeline, you can see NUEDEXTA on the top there with FDA approval for the treatment of pseudobulbar affect. In addition, you can see NUEDEXTA or AVP-923 in Phase II studies for central neuropathic pain in multiple sclerosis. In regards to behavioral disturbances in Alzheimer’s, we’re currently working on our investigation on New Drug Application. We’re planning on filing that with the FDA in the second quarter of this year with the intent of enrolling our first patient in mid-to-late summer of this year. And, finally, our diabetic peripheral neuropathic pain, you may be aware that we announced a publication of our Phase III studies in diabetic peripheral neuropathic pain a number of weeks ago, that program looks very promising. However, we it on hold right now until we get the results of our neuropathic pain and multiple sclerosis. Additionally on the slide, you now see the addition of our deuterated dextromethorphan program. That is a preclinical asset that’s what we’ve planned on to moving that into the clinic as quickly as possible. And then, finally, our non-CNS related products ABREVA and Thravixa.

So a quick overview of the deal that we signed with Concert Pharmaceuticals this morning, it is an exclusive worldwide license agreement to develop and commercialize deuterated dextromethorphan. Concert is a privately-held company in Lexington, Massachusetts. We’re getting a several deuterated dextromethorphan compounds. And what’s very exciting for us is that deuterated dextromethorphan is a new chemical entity and therefore has the associated intellectual property with the new chemical entity and the existing patents lasts through 2030, with opportunities for extension, as well as additional patent applications in the future. And I’ll go into a little more detail on the deuterated technology later in the presentation.

So turning now to recent achievements of the company, as I mentioned at the onset, the launch of NUEDEXTA continues to go quite well. We have achieved a record prescriptions in December of over 5,600 prescriptions and over 6,000 in January, showing nice continued growth. If you take data point from early February, we’ve had over 1,600 prescriptions in that week alone. If you annualize the value of those prescriptions, it annualizes to a run rate of $37 million in NUEDEXTA sales, and that we continue to see – expect to continue to see growth in weekly and monthly prescriptions.

With regards to adoption of the physician community, we continue to see 70 to a 100 subscribers each week. We’ve seen this over the past year and we think it’s a very positive sign for the product, as more and more physicians get exposure to NUEDEXTA and the benefits that it brings to patients. Then, finally, in the fourth quarter of last year, we deployed our institutional sales force, approximately 32 representatives focused on the long-term care setting and we’ve seen a very strong uptake within that segment, with long-term care now representing over 50% of the total prescriptions written for NUEDEXTA.

Turning now to a quick overview on pseudobulbar affect and the PBA market, for those of you not familiar with PBA, PBA is a neurologic disorder that causes uncontrolled emotional outbursts. In our case, we studied episodes of uncontrolled laughing and/or crying in our Phase III clinical studies. And what’s important about pseudobulbar affect is it must occur secondary to a neurologic disease or injury. So it occurs secondary to multiple sclerosis, to Alzheimer’s disease, and other forms of dementia, secondary to Parkinson’s, dramatic brain injury or stroke.

And what happens is there is essentially a legion in the brain, because of the disconnect between the front and the back of the brain, these people no long are allowed to control their emotions and they have these uncontrolled outburst that can last anywhere from five to 30 seconds to upwards of 5 minutes. And if you’ve seen – if you’ve met one of these patients or if you’ve seen the impact of PBA, you can understand that these patients are already dealing with a very significant neurologic disease or (inaudible) sustained a neurologic injury, and this uncontrolled episodes add significant burden for these patients. To give you a sense in our clinical studies, the average patient was having five to seven episodes per day. So five to seven uncontrolled emotional outbursts per day between 35 and 50 episodes per week. So it takes a significant toll on these patients.

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