Santarus' CEO Presents At Bank Of America Merrill Lynch 2012 Health Care Conference (Transcript)

Santarus, Inc. (SNTS)

Bank of America Merrill Lynch 2012 Health Care Conference Call

May 15, 2012 5:20 pm ET


Gerald T. Proehl – President and Chief Executive Officer

Wendell Wierenga – Executive Vice President, Research and Development

Debra P. Crawford – Senior Vice President, Chief Financial Officer, Treasurer and Secretary


[Starts Abruptly]

Biotech team at Bank of America Merrill Lynch. Our next presenting company is Santarus, and it’s my pleasure to introduce Executive Vice President of R&D, Wendell Wierenga.

Wendell Wierenga

Thank you very much for the introduction and the opportunity to present Santarus at Bank of America conference. I also need to remind the audience that we are making forward-looking statements based on our beliefs and assumptions that are currently available to us. I also want to note that, Debbie Crawford is also here today with myself representing Santarus, and we look forward to participating in the question-and-answer as the presentation winds up.

Debbie Crawford is the CFO of Santarus. Santarus represents in my view, a very compelling investment rationale for three reasons, number one, we have growing revenues on our exclusive marketed products; number two, we are focusing on physician specialists, and number three, we have a balanced portfolio, balanced in the sense that its marketed as well as late stage development programs and even programs that are longer term in terms of the development horizon and ultimate commercialization, and we’re balancing our SG&A and R&D investment to not only capitalize on the near-term, but also to achieve sustained growth in the longer term.

Another way of looking at this is, to look at our portfolio relative to its maturity, the marketed products are shown here in blue, including the products that I’ll spend some time on GLUMETZA, CYCLOSET and FENOGLIDE as well as some very important near-term value drivers for Santarus and that is UCERIS, which is currently under review as the FDA turns that the NDA application filed for the treatment of ulcerative colitis.

Recombinant C1 inhibitor, otherwise known recently as RHUCIN and we’re having to change the trademark relative to some recent FDA feedbacks that are referred to this as recombinant C1 inhibitor, which is ramping up its pivotal clinical trial program, an anticipation in the filing with the agency. And also in the same timeframes is rifamycin MMX for the treatment of travelers’ diarrhea are in the Phase III clinical trail, it’s also targeting to completion of enrolment then in the third quarter of this year.

And lastly, we have an early stage program that I’ll spend just a bit tough time at the end, which is called SAN-300, which is an antibody to an integrin that has broad potential therapeutic utility.

Our focus as I said is on physician specialists, but for the time we have a 150 reps that are focusing on endocrinology technology primarily, not in view of the products that we are advancing in the marketplace for the people with type 2 diabetes. And primarily they are investing in GLUMETZA, CYCLOSET and FENOGLIDE. We anticipate that we’ll be expanding our sales force assuming approval of UCERIS to achieve penetration into a gastroenterology area.

This is an area that’s new to Santarus, because historically we have sold and promoted ZEGERID for the treatment occurred, and we have still a number in our organization that have had that experience, but this will mean a new investment for us into gastroenterology, and we’re anticipating that investment then upon approval of UCERIS on the timeframe that I’ll detail in just a moment.

Taking over longer-term as we advance our current programs of development into other area as a specialty such as allergy, this is primarily for our recombinant C1 inhibitor for the treatment of hereditary angioedema, and immunology and rheumatology in particular as we look at various indications for SAN-300.

As you can see, I noticed at the beginning in terms of investor rationale for Santarus, we are seeing a nice upward trend of sales on our key marketed products, GLUMETZA being our primary driver at the present time. You can see here the last 15 months of sales and the four-week moving average in terms of prescription trends both in terms of total as well as nuc. The differentiating feature with GLUMETZA, is the fact that it is a control-released delivery that minimizes GI side-effects an issue with metformin itself. And allow patients to achieve their hemoglobin A1C1 goal both in terms of total abilities as well as in terms of time frame. And this has been a program that has increased well for us over the last 12 months. We have been able to equalize on the competitive cost basis relative to generic metformin, and as you can see, we have a 36% growth over quarter from 2011.

We are looking at the opportunities space here because the called on physicians that we are impacting right nearly 8 million prescriptions a year for generic metformin and our total prescription number is a fraction of that. So we believe there is a lot of opportunity here yet to advance our branded version in this particular marketplace. Not only because of this but also because of the differentiated features of the product and this will be bearing out over time.

Secondly in our diabetes Type II franchise, we have a unique formulation of bromocriptine, which is representing a first in class treatment for Type II diabetes. This is the only central reacting agent out there and in addition it has some very valuable cardiovascular end point data. This is the first Type II diabetes drug to be registered that has a CVOT trial completed, 52 week study in over 3000 patients were not only did it demonstrate a lot of associated increased but in fact a net of 55% relative risk reduction for (inaudible) cardiovascular death.

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