Amylin Pharmaceuticals, Inc. (AMLN)

Q2 2010 Earnings Call

July 21, 2010 5:00 p.m. ET

Executives

Michel York - IR

Daniel Bradbury - President & CEO

Mark Foletta - SVP, Finance & CFO

Vince Mihalik - SVP, Sales and Marketing & CCO

Analysts

Mark Schoenebaum - ISI Group

Yaron Werber - Citi

Thomas Wei - Jefferies

Jim Birchenough - Barclays

Cory Kasimov - JPMorgan

Josh Schimmer - Leerink Swann

Ian Somaiya - Piper Jaffray

Tom Russo - Robert Baird

Mario Corso - Caris & Company

Presentation

Operator

Welcome to the Amylin Pharmaceuticals Q2 2010 Earnings Call. (Operator Instructions). This conference is being recorded. If you have any objections, please disconnect at this time. I would like to introduce your host Mr. Michel York, Senior Director, Investor Relations. Sir, you may begin.

Michel York

Good Afternoon and welcome to Amylin Pharmaceuticals quarterly update conference call. We have uploaded a presentation to accompany this conference call that provides additional background on the quarter. Today's discussion will contain forward looking statements that involve risk and uncertainties. These risks and uncertainties are outlined in today's press release, the website presentation and in our recent filings with the Securities and Exchange Commission. Our actual results could differ materially from what is discussed on today's call.

Let me introduce the other members of the Amylin Management Team here today. Daniel Bradbury, President, Chief Executive Officer; Mark Foletta, Senior Vice President, Finance and Chief Financial Officer, and Vince Mihalik, Senior Vice President, Sales and Marketing and Chief Commercial Officer. I will now turn the call over to Daniel Bradbury.

Daniel Bradbury

Thanks, Michael and welcome to our second quarter call. This afternoon our comments will build on the press release issued earlier today. In a few moments, Mark will provide additional details on the quarter's underlying financial results and comment on our outlook for the rest of the year. Vince will then review our commercial activity during the second quarter and highlight our plans for the remainder of the year.

At the beginning of the year, I laid out for you four areas of focus for 2010 that we believe will help maximize shareholder value. I will now provide a brief update on our progress during the quarter as it relates to those goals.

First, we remain focused on driving revenue of our existing products. Through the first half, we've not met our expectation for revenue generation. However, we continue to track very encouraging prescription trends for the GLP-1 receptor agonist class.

In fact, monthly new prescriptions for BYETTA grew 20% in June; an overall growth for the class remained strong. As we head into the second half of the year, we will continue to aggressively promote the benefits of treatment with BYDUREON and SYMLIN that we've established over the past five years.

Second, we remain focused on successfully launching BYDUREON. From the second quarter, following our response to the complete response letter, we received a revised PDUFA Action Date of October 22nd. We're confident in our response and are continuing our discussion with the FDA to bring this important new therapy to patients this year.

Third, we plan to achieve positive cash flow from operations by the end of 2010 on a sustainable basis and for the full year of 2011. On non-GAAP operating loss for the second quarter, with $7.4 million, a 67% improvement over the same period last year. We remain on track to achieve these goals, realize the benefit of the significant operating leverage we built into our business and drive bottom-line growth.

And finally, as we focus on long-term value creation for shareholders, we intend to continue to advance our pipeline. Our plans to submit the clinical and non-clinical sections of a new drug applications for the use of produce of metreleptin to treat severe lipodystrophy remain on track.

But most treatment currently approve to treat severe lipodystrophy, we believe that based on published studies, this treatment could become an important new option to help patients impacted by this debilitating metabolic disease.

We also announced earlier in the first half, that in conjunction with our partner Takeda, we have decided to move pramlintide/metreleptin towards Phase 3 clinical studies. This is a key step forward towards making a new peptide therapy for the treatment of obesity available to patients.

Additionally, we continue to invest strategically in the exenatide franchise. The development of a pen for BYDUREON remains on track, and we are planning to have it available to patients late in 2012 or early in 2013, contingent on a timely regulatory review.

We have also initiated a Phase 2 study of a monthly dose suspension formulations of exenatide during the second quarter and we expect to see data from this study in the first half of 2011, driven on a ground body of clinical and post-marketing data while leveraging the potency of the exenatide molecule and the Alkermes' Medisorb technology, we believe this formulation represents the first truly viable opportunity for a monthly dose therapy for type 2 diabetes.

Now, before we continue into a more detailed discussion on recent activities. I will turn things over to Mark Foletta to review our financial results released earlier today.

Mark Foletta

Thanks Dan. Today we announced our financial results for the quarter ended June 30, 2010. As Dan mentioned, and we have discussed in previous calls, we are managing the business with operational discipline, and are focused on generating sustainable, positive operating cash flow and maintaining a strong cash position.

Our measure of operating cash flow, non-GAAP operating loss was $7.4 million for the second quarter, compared to $3.8 million in the first quarter. We expect continued variability in our operating results over the next few quarters due to incremental expenses to support the launch of BYDUREON. BYETTA sales were down $9.1 million sequentially, or 6% and total prescriptions were down 8% during the period.

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