Medivation Management Discusses Q2 2012 Results - Earnings Call Transcript

Medivation (MDVN)

Q2 2012 Earnings Call

August 09, 2012 4:30 pm ET

Executives

Anne Bowdidge

David T. Hung - Chief Executive Officer, President and Executive Director

C. Patrick Machado - Chief Financial Officer, Principal Accounting Officer, Chief Business Officer and Secretary

Lynn Seely - Chief Medical Officer and Senior Vice President

Cheryl Cohen - Chief Commercial Officer

Analysts

John Beshai

Kimberly Lee - ThinkEquity LLC, Research Division

Yaron Werber - Citigroup Inc, Research Division

Y. Katherine Xu - William Blair & Company L.L.C., Research Division

Geoffrey C. Porges - Sanford C. Bernstein & Co., LLC., Research Division

Lee Kalowski - Crédit Suisse AG, Research Division

Biren Amin - Jefferies & Company, Inc., Research Division

Raghuram Selvaraju - Aegis Capital Corporation, Research Division

Ling Wang - Summer Street Research Partners

Eric Schmidt - Cowen and Company, LLC, Research Division

Howard Liang - Leerink Swann LLC, Research Division

Presentation

Operator

Good day, everyone, and welcome to Medivation's scheduled conference call. This call is being recorded. [Operator Instructions] I would now like to turn the call over to Anne Bowdidge, Senior Director of Investor Relations. Please go ahead.

Anne Bowdidge

Thank you for joining us. On the call today from Medivation are Dr. David Hung, President and CEO; Patrick Machado, Chief Business and Financial Officer; Dr. Lynn Seely, Chief Medical Officer; and Cheryl Cohen, Chief Commercial Officer. We issued a press release earlier today that you can find on our website at www.medivation.com.

Before we begin, I'd like to remind you that various remarks we make on this call contain forward-looking statements that are made under the Safe Harbor provisions of the securities laws, including statements regarding the potential future regulatory approval and commercialization of enzalutamide and the timing thereof; continued clinical development of enzalutamide; potential future clinical trial events or results; the therapeutic potential and safety profiles of our product candidates; our future opportunities and milestones; and financial guidance for the remainder of 2012, including projected revenue recognition, operating expenses, capital expenditures and receipt of development milestone payments.

In addition to our prepared remarks, we may make forward-looking statements in response to questions, including, for example, statements regarding our current and potential future collaboration and our future financial position and results. Any statements made in this call are not -- that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements involve risks and uncertainties that could cause Medivation's actual results to differ significantly from those projected, including, without limitation, the risks and uncertainties detailed in Medivation's Form 10-Q for the quarter ended June 30, 2012, filed today with the SEC. All forward-looking statements made during this call are based on information available to us as of today, and we assume no obligation to update these statements as a result of future events or otherwise.

With that, I'll turn the call over to Dr. David Hung, President and CEO of Medivation. David?

David T. Hung

Thanks, Anne. Thank you all for joining us today. 2012 has been an eventful year for Medivation. I'd like to start the call with some exciting recent developments, and Pat will review second quarter 2012 financial results. And after that, we'll open the call up for Q&A.

Just a little over 2 weeks ago, we achieved a major corporate milestone, when the FDA notified us that our NDA for enzalutamide for the post-chemotherapy indication was accepted for filing and granted priority review designation, which is reserved for drugs that offer a significant improvement in treatment or provide treatment where no satisfactory alternative therapy exists. This acceptance triggers a $10 million milestone payment to Medivation under our collaboration agreement with Astellas.

In addition, on June 26, Astellas submitted an MAA to the EMA seeking approval to market enzalutamide in Europe for the post-chemo indication. Also in June, new data from our Phase III AFFIRM trial was highlighted at ASCO, where Dr. Johann de Bono, co-principal investigator of the trial from The Institute of Cancer Research and Royal Marsden Hospital, presented data showing that patients treated with enzalutamide reported significantly higher response rates and health-related quality-of-life measures compared to placebo, as measured by the FACT-P questionnaire, a validated measure of patient function.

Patients also demonstrated a significantly longer median time to occurrence of the first skeletal-related event compared to placebo. Our Phase III AFFIRM trial has provided us with a very rich data set, and we look forward to presenting additional data from this trial at future medical meetings.

As you know, if enzalutamide receives marketing approval, Medivation will provide 50% of the sales and medical affairs field forces supporting enzalutamide in the U.S. Since our last quarterly call, we've completed the build-out of our sales and medical affairs field forces, and we are in the final stages of preparing for launch. We continue to expect to receive FDA approval and to launch enzalutamide for our post-chemo patients in the U.S. this year. Given its potential benefits across a wide variety of prostate cancer disease states and long patent life, we and our alliance partner, Astellas, are all conducting a broad clinical development plan for enzalutamide, which we further expanded this quarter with the addition of several new trials.

As background for understanding the various patient populations we are studying in these trials, let me begin by providing a brief overview of the various prostate cancer disease states and current therapies.

Upon initially being diagnosed with prostate cancer, many men opt for what is known as definitive treatment, either surgical removal of the prostate or radiation to the prostate. In most instances, these procedures successfully eradicate all the cancer cells and, thus, are curative. However, unfortunately, a significant number of these procedures fail, and the prostate cancer continues to progress, as typically evidenced by a rising PSA level. Men whose prostate cancer has progressed following definitive treatment are said to have advanced prostate cancer. Because prostate cancer is fueled by the male sex hormone, testosterone, the initial treatment for men with advanced prostate cancer is castration, either medically, through the use of drugs known as LHRH analogs, or surgically. These treatments reduce serum testosterone to castrate levels, which generally slows disease progression for a period of time. However, in virtually all cases, the cancer will continue -- will eventually continue to progress. Men whose prostate cancer has progressed following either medical or surgical castration are said to have castration-resistant prostate cancer or CRPC. These patients typically are given hormonal therapy with an anti-androgen, such as bicalutamide, and then move on to chemotherapy once their disease continues to progress.

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