NeurogesX's CEO Discusses Q2 2012 Results - Earnings Call Transcript

NeurogesX, Inc. (NGSX)

Q2 2012 Earnings Call

August 3, 2012 8:30 AM ET

Executives

Nicole Greenbaum – IR

Ronald Martell – President and CEO

Stephen Ghiglieri – EVP, COO and CFO

Presentation

Operator

Greetings and welcome to the NeurogesX, Inc., Second Quarter 2012 Earnings 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, Nicole Greenbaum of the Ruth Group. Thank you, Ms. Greenbaum. You may now begin.

Nicole Greenbaum

Thank you operator. Joining us on the call today are Ronald Martell, President and Chief Executive Officer; Stephen Ghiglieri, Executive Vice President, Chief Operating Officer and Chief Financial Officer; Michael Markels, Senior Vice President, Commercial and Business Development; and Dr. Stephen J. Peroutka, Executive Vice President and Chief Medical Officer.

Statements in this conference call regarding NeurogesX’s business which are not historical facts may be forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995 or the Act. NeurogesX disclaims any intent or obligation to update these forward-looking statements and claims protection of the Safe Harbor for forward-looking statements contained in the Act.

Forward-looking statements may include, but are not limited to, statements regarding expected quarterly cash usage rates for 2012, expectations and timing with respect to our entering NGX-1998 into Phase 3 clinical trial; the potential timeline of development of NGX-1998; and End-of-Phase 2 meeting with the FDA for NGX-1998 and expected areas of focus and benefits from such meetings and interactions with the FDA, securing and development partner for NGX-1998, the sufficiency of cash to fund operations well into 2013, expected reduced revenues from Qutenza commercialization efforts and expectations respect to such commercialization efforts, the benefits of NGX-1998 including as compared to Qutenza and its potential market advantage, and potential participation of our commercial partner in development of NGX-1998.

Actual results may differ from these discussed here today. Factors that may affect the outcome of forward-looking statements are explained in the risk factors section of our filings with the SEC, including our Form 10-Q, which this company filed with the SEC on May 10, 2012 and as updated by our Form 10-Q for the fiscal quarter ended June 30, 2012 that we expect to file with the SEC on or about mid August 2012.

Now I would like to turn the call over to Ronald Martell, President and Chief Executive Officer of NeurogesX.

Ronald Martell

Thanks you, Nicole. Good morning and thank you for joining us on our call. I’d like to provide you with an update on our activity this quarter and progress towards our corporate goals.

As we discussed on our last earnings call, we have fully aligned our resources behind our next generation product candidate, NGX-1998, a topically applied liquid formulation of prescription strength capsaicin designed to treat pain associated with neuropathic conditions.

As you know, 1998 has the same active pharmaceutical ingredient or API as Qutenza , our approved therapy. However, NGX-1998 has product attributes that have potential to create a significant market advantage over Qutenza. For example, Phase 2 data suggests that treatment with NGX-1998 requires only a five minute topical application for up to three months of pain relief. In addition, 1998 will be delivered by an easy to use applicator that could potentially facilitate home administration of the therapy.

The liquid formulation and applicator will also allow for treatments of such areas that were more difficult to treat with the patch such as hands and feet. The advantages of 1998 product profile are very exciting and its potential has driven our adoption of strategic goal that focus on enabling a Phase 3 study of NGX-1998 by the end of this year. In addition, we are continuing to manage costs and expenses following the March 2012 reorganization, while maintaining access to Qutenza for patients whom it provides relief.

As we discussed in the second quarter, the FDA accepted our request for an End-of-Phase 2 meeting for NGX-1998. Also during the quarter, we’ve submitted a briefing package to the Agency in support of that meeting. As we expect this will be a 505(b)(2) application, one of our objectives is to gain guidance as to how much the FDA will allow reliance on the significant data we and our partner Astellas have generated that address the safety and efficacy of prescription strength capsaicin, the API shared by 1998 and Qutenza.

With guidance as to the level of a clinical data, the Agency will need for approval of NGX-1998, we will be better able to finalize our development plan including the Phase 3 clinical trial designs and move the program forward. Additionally, this guidance we believe will aid in our partnering effort. If we or our partner are able to initiate the Phase 3 clinical trial by the end of this year, that could allow for clinical trial completion in 2014, NDA submission in 2015 and a possible approval in late 2015 or early 2016.

With respect to our partnering efforts, we have been working closely with JSB-Partners identifying and engaging with potential development and commercial partners in the U.S. and other un-partnered major global markets. The process is well defined and we are making progress. I am pleased to report that there are multiple parties currently in due diligence phase. As a reminder, NeurogesX retained exclusive rights in U.S., Canada, Asia and Latin America for NGX-1998 and Qutenza.

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