Idenix Pharmaceuticals, Inc. (IDIX)

Q2 2010 Earnings Call Transcript

July 26, 2010 4:30 pm ET

Executives

Jonae Barnes – SVP, IR & Corporate Communications

Ron Renaud – CFO and Chief Business Officer

Doug Mayers – EVP and Chief Medical Officer

Jean-Pierre Sommadossi – Founder, Chairman and CEO

David Standring – EVP, Biology

Analysts

John Sonnier – William Blair & Company

Stephen Willey – Stifel Nicolaus

Howard Liang – Leerink Swann & Company

Liisa Bayko – JMP Securities

Brian Abrahams – Oppenheimer & Co.

Brian Skorney – ThinkEquity LLC

Presentation

Operator

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Good afternoon. My name is Bonnie and I will be your conference operator today. At this time, I would like to welcome everyone to the second quarter 2010 earnings 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.

I would now like to turn the conference over to Jonae. Please go ahead.

Jonae Barnes

Good afternoon and welcome to Idenix’s conference call to discuss our second quarter and first half 2010 financial results. We will also provide a Research and Development update on the progress of our HCV candidates.

With me today are Jean-Pierre Sommadossi, CEO; Ron Renaud, CFO; Doug Mayers CMO; and David Standring, Executive Vice President, Biology.

Before we begin, let me review our Safe Harbor statement. Today's discussions contain estimates and other statements that are forward-looking under the Private Securities Litigation Reform Act of 1995. Such estimates and statements are based on current expectations and assumptions and that are subject to risks and uncertainties and involve a number of factors that could cause actual results to differ materially.

Additional information concerning these factors is contained in our filings with the SEC, which are available on the investor section of our website at www.idenix.com. While we may elect to update forward-looking statements in the future, we specifically disclaim any obligation to do so, even if our estimates change. You should not rely on these forward-looking statements as representing our estimates as of any date subsequent to today.

The agenda for today’s call is as follows. Ron will review our financial results for the quarter and first half of 2010, Doug will then provide a Research and Development update for our HCV programs, and JP will summarize our first half 2010 achievements and highlight our upcoming milestones. We will then open the call for Q&A for which David will also be available.

I will now turn the call over to Ron

Ron Renaud

Thanks a lot, Jonae. Now, we know the stock was halted and believe there may have been some confusion with regard to how we recorded the recently received milestone payment from ViiV Healthcare. The preclinical operational milestone of $6.5 million from ViiV which we received in May was recorded as deferred revenue and is being recognized over the life of the agreement.

We believe this represents most of the difference between the consensus revenue estimates and what we are reporting today. Keep this in mind for future forecasting.

Moving to the second quarter which ended June 30, 2010, we reported total revenues of $1.3 million compared to total revenues of 2.4 million in the second quarter of 2009. We reported a net loss of $16.3 million or a loss of $0.23 per basic and diluted share for the second quarter ended June 30, 2010 compared to a net loss of $16.3 million or a loss of $0.28 per basic and diluted share for the second quarter ended June 30, 2009. For the six months ended June 30, 2010. We reported total revenues of $4 million. This compares to total revenues of 6.5 million for the six months ended June 30, 2009.

We reported a net loss of $32.5 million or a loss of $0.47 per basic and diluted share for the six months ended June 30, 2010 compared to a net loss of $29.2 million or a loss of $0.50 per basic and diluted share for the six months ended June 30, 2009.

Now, moving along to our 2010 financial guidance, Idenix ended the second quarter of 2010 with $51 million in cash and cash equivalents.

We anticipate that our current cash and cash equivalents together with the anticipated royalty payments associated with product sales of Tyzeka/Sebivo can fund operations into mid-2011. It is important to note that this guidance assumes no additional milestone payments, license fees, reimbursement for development programs, and no additional financing activities.

With that, I'll now turn the call over to Doug.

Doug Mayers

Thank you, Ron. It's been a busy summer so far and I am pleased to report that we are hitting all our clinical timelines. Let me start with an update of our most advanced program, IDX184 a liver targeted nucleotide polymerase inhibitor.

I am pleased to report that all patients have recently completed dosing in the 14 day Phase IIa clinical trial. This trial is evaluating 50 to 200-milligram daily doses of IDX 184 in combination of pegylated interferon and ribavirin in treatment naïve genotype 1-infected patients. Preliminary safety evaluation from this trial suggests that the side effect profile of IDX 184 in combination with pegylated interferon and ribavirin appears similar to that for treatment with pegylated interferon and ribavirin alone.

Data from this study have been submitted for presentation at the annual meeting of the American Association for the Study of Liver Diseases, AASLD which will be held at the end of October in Boston and if accepted, full data from this study, including the 150 and 200-milligram cohorts will be presented.

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