NexMed, Inc. (NEXM)

Q1 2010 Earnings Call

May 14, 2010 12:00 pm ET


Ed Cox – VP, IR and Corporate Development

Bassam Damaj – President and CEO

Vivian Liu – EVP


James Backus [ph] – Backus Capital [ph]



Greetings, and welcome to the NexMed Incorporated first quarter 2010 results conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator instructions) As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Ed Cox, Vice President of Investor Relations and Corporate Development for NexMed Incorporated. Thank you. Mr. Cox, you may begin.

Ed Cox

Good morning, I am Ed Cox, Vice President of Investor Relations and Corporate Development here at NexMed. On the call with us today are Dr. Bassam Damaj, Chief Executive Officer; Mark Westgate, Chief Financial Officer; and Vivian Liu, our Executive Vice President.

Before we begin, I will read the forward-looking language statement, and then turn the call over to Bassam for an update on the business and financial condition of the company. Following Bassam’s remarks, we will open the call for your questions and comments.

Just a reminder to everyone, that during the course of the call, the management team will make forward-looking statements regarding future events or the future financial performance of the company. Please keep in mind that such statements are predictions based on current expectations, and actual results could differ materially. You should refer to our most recent filing with the Securities and Exchange Commission for additional discussions on factors affecting our business.

Now, I will turn the call over to Bassam.

Bassam Damaj

Thank you, Ed, and thank you all for joining us this morning. I am excited to share with you the wonderful advances that NexMed has made since we last spoke on our year-end 2009 call.

As you may know, our 10-Q we filed yesterday, represented the first full recording period of the combined company. My goal for the merger was to position NexMed as a leader in the CRO business and (inaudible) delivery. I believe we are well on our way. Today, NexMed has excellent capabilities across drug delivery technology for (inaudible) and biologics. We have a robust late stage pipeline with the potential to sustain near and long-term growth.

We have a broader preclinical product portfolio, and a very diverse and powerful NexACT drug delivery technology. The combination of these capabilities, along with our revenue generating CRO business, our current cash results, industry connection, our strategic vision, and our experienced personnel will enable us to achieve our goals for the future.

We also have made considerable progress in exhibiting our integration plans while continuing to drive growth, maintain our business momentum, and reduce our cost structure. I would like to point out that although from the filings we did for the 10-Q, our Q1 2009 revenues were higher than our Q1 2010 revenues, it should be noted that the revenue for Q1 2009 included a one-time $2.5 million payment from the sale of Vitaros US rights to Warner Chilcott.

We also anticipate similar licensing payments during 2010, as we license our products and technologies. NexMed’s mission is to make a difference in the lives of people, and to maximize shareholder return by providing innovative medicines through our own proprietary drugs and through the services we deliver to our clients around the world.

This mission from and all the hard work being done to accomplish it every day by NexMed is what makes me so excited about this opportunity we have before us, and what makes me so excited to work for such a great company.

Let me take a few minutes to update you more specifically on our operations. First, I would like to start with Vitaros. As we announced, we submitted our response to Health Canada in mid-April. Our response is part of the review process for our new drug submission or NDS. Under the 45 day screening period, Health Canada has until the end of May to decide if they would agree to accept our response.

The acceptance of the response will then trigger a new 150 day review cycle by the NDS reviewers for a final approval or rejection of the marketing application. We will announce any updates we receive to our shareholders in a timely manner, as this process progresses.

In terms of our partnering efforts for Vitaros, we remain in active discussion with potential partners, although we have not made the decision as to partner it or to market the product ourselves in Canada.

In the US, many of you have asked us if there have been any responses from the FDA concerning the CAC assessment package that we submitted during the fourth quarter of 2009. We had hoped for a response by the end of March, based on guidance previously provided by the FDA. We are following up regularly with the FDA through our partner, Warner Chilcott, and be assured that we will keep you updated of any new development.

Meanwhile, we have been assessing new product opportunities for Vitaros based on work already completed for the ED indication. As you may know, the active ingredient of Vitaros is prostaglandin E1 or Alprostadil, and PGE1 has been shown to be clinically effective in multiple diseases in many clinical trials. The ability to adjust the dose of the active drug in our (inaudible) formulation, allows us to use it for potentially multiple disease indications, while keeping strong intellectual property coverage.

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