Forest Laboratories (FRX) Q3 2011 Earnings Call January 18, 2011 10:00 am ET Executives
By way of Safe Harbor statement, let me add that various remarks that we may make about future expectations, plans and prospects for the company constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and actual results may vary. Let me now turn the call over to Frank, who will comment on the business during the quarter.Francis Perier Thank you, Frank and good morning, everyone. I will start today's call by reviewing key company events for the quarter, as well as the financial results for the quarter, and then turn the call over to Mark Taglietti, who will review the R&D pipeline. But before we begin, I would like to take a moment to wish Larry Olanoff, all the best in his retirement, and to thank him on behalf of everyone at Forest Laboratories for his outstanding leadership during his tenure. Larry began his career with Forest in 1995 as Chief Scientific Officer, and was our Chief Operating Officer since 2006. During his years with Forest, he created and built the Forest Research Institute which has produced our successful marketed product folio from Celexa to our most recently approved product Teflaro, as well as our robust development pipeline. We will certainly miss the day-to-day interactions with Larry, but we will still have the benefit of his expertise as a member of our Board of Directors and as Senior Scientific Advisor to the company. Turning now to operations. Our underlying business continued to perform very well during the quarter for our key marketed products. Lexapro sales were essentially, unchanged from last year despite the expected modest decrease in market share, and we saw a continued solid prescription volume growth for Namenda, Bystolic and for our newest product launched, Savella. We've had a very busy quarter including FDA approval of Teflaro, for the treatment of community-acquired bacterial pneumonia, and acute bacterial skin and skin structure infection. We launched Teflaro earlier this month, and are targeting approximately 2,000 key hospitals. In preparation for the launch, we doubled the size of our hospital sales force to around 240 sales representatives, and now have about 95% of that total onboard in place in a very competitive -- which places us in a very competitive position in the antibiotic market.
We started detailing with the scientific launch in December using the product label and we currently plan the full launch with DDMAC-approved marketing materials around the end of March. Teflaro began shipping in January. The wholesale average cost price for Teflaro is $82 per day of therapy. With approximately 23 million annual therapy days for each of the pneumonia and skin infections, we will be competing in a market valued at brand prices worth well over $3 billion. We also announced the completion of three business development agreements.In November, we were pleased to announce that we entered into collaboration and distribution agreement with Janssen to commercialize Bystolic and Savella in Canada. Over the next few years, we plan to establish a wholly-owned Canadian affiliate that will exercise the co-promotion rights for Bystolic and Savella in Canada. And they will also take responsibility for the future regulatory filings and commercialization of our pipeline products in Canada which include: Teflaro, linaclotide, levomilnacipran and cariprazine. This collaboration is a significant and valuable first step towards establishing a Forest presence in Canada. In December, we entered into two agreements with Gruenenthal. We acquired all rights currently held by Gruenenthal for colistin and all rights previously licensed by Forest to Gruenenthal for Colobreathe. Both products are for the treatment of cystic fibrosis. We currently market colistin in the U.K. and Ireland. With this transaction, we will expand our European cystic fibrosis franchise while expanding our commercial capabilities in Europe in addition to our existing presence in the U.K. and Ireland. This is a first step at expanding our commercial capabilities in Europe in addition to our existing presence in the U.K. and Ireland, and also strengthens our presence in the cystic fibrosis market in Europe. Read the rest of this transcript for free on seekingalpha.com