Biodel's CEO Discusses F3Q12 Results - Earnings Call Transcript

Biodel Inc. (BIOD)

F3Q12 Earnings Call

August 8, 2012 5:00 pm ET


Paul S. Bavier – Corporate Secretary and General Counsel

Errol B. De Souza – President and Chief Executive Officer

Gerard J. Michel – Chief Financial Officer, Vice President of Corporate Development and Treasurer


Matthew Kaplan – Ladenburg Thalmann Securities

Jason Butler – JMP Securities LLC

Richard Reznick – William Blair & Co. LLC

Marc Stutman – Trimark



Ladies and gentlemen, thank you for standing by. Welcome to Biodel’s Third Quarter Fiscal Year 2012 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After opening remarks, we will open up the call for your questions. Instructions for queuing up will be provided at that time. I would also like to remind you that this call is being recorded for replay.

I will now turn the conference call over to Paul Bavier, Biodel’s Corporate Secretary and General Counsel.

Paul S. Bavier

Thank you. Good afternoon and welcome to our third quarter fiscal year 2012 conference call. On the call, we will be making forward-looking statements covered under the Private Securities Litigation Reform Act of 1995. These statements may involve risks and uncertainties that are described more fully in our filings with the SEC, which are also available on our website. Forward-looking statements represent our views only as of today, and should not be relied upon as representing our views as of any subsequent date. While we may elect to update forward-looking statements at some point in the future, we disclaim any obligation to do so even if our estimates change.

Joining us on today’s call are Dr. Errol De Souza, Biodel’s President and Chief Executive Officer; Gerard Michel, our Chief Financial Officer and Vice President of Corporate Development; and Dr. Alan Krasner, our Chief Medical Officer. After their prepared remarks, we will open the call to your questions.

Now I’ll turn the call over to Errol.

Errol B. De Souza

Thank you, Paul. Good afternoon, everyone. Since the last quarter, we’ve continued to build on our momentum in advancing our three key programs. In today’s call, we will discuss our successful financing, progress made in our glucagon program, details regarding our planned Phase II trial for ultra-rapid-acting formulation of recombinant human insulin or RHI, and the status of our analog-based ultra-rapid-acting insulin program.

Let me begin by discussing our recent financing. As we announced on June 22, we successfully completed a private placement financing of $18.5 million. We’re gratified that this financing was supported by high-quality institutional investors, including both existing and new shareholders.

We’re also pleased that the offering was oversubscribed, which afforded us the opportunity to prudently permit inclusion of funds beyond our initial expectation. Prior to the financing, we disclosed the timing of several key milestones, including the completion of the Phase II BIOD-123 trial and submission of the glucagon NDA for the treatment of severe hypoglycemia, that will were beyond our previously stated cash runway of mid-2013.

The recently completed financing will enable us to reach these critical milestones, and consider prospects that may enhance the value of our research and development programs, which I will touch on in the course of this afternoon’s call.

The first program I want to discuss is the development of our stabilized liquid glucagon product candidates. On June 8, we announced a partnership with Aegis Therapeutics that provides us with an exclusive worldwide license to Aegis’ proprietary ProTek and Intravail technologies, for the development and commercialization of pharmaceutical formulations of glucagon.

ProTek protein stabilization technology comprises the use of proprietary excipients that prevents aggregation of proteins and peptides, thereby improving the stability of the drug product formulated with these excipients. Intravail comprises a broad class of transmucosal absorption enhancement agents that allow non-invasive systemic delivery of peptide, protein, nucleotide-related, and other small and large molecule drugs.

The agreement with Aegis allows for the development and commercialization of a wide variety of glucagon presentations including our lead glucagon product candidate, which is a liquid formulation intended to use as a rescue treatment for diabetes patients experiencing severe hypoglycemia.

Other potential presentations and indications include the use of glucagon in the treatment of hyperinsulinemia with continuous subcutaneous infusion and the treatment of mild to moderate hypoglycemia, we have both an intra-nasal formulation and a subcutaneous infusion pump. The pump formulation and indication is a critical step that was a development of an artificial pancreas.

The liquid glucagon formulations utilizing the Aegis technology show improved stability profiles in shorter-term studies under room temperature conditions and at 37 degrees centigrade, when compared to the earlier Biodel proprietary formulations, which have demonstrated almost two years of real time stability under refrigerated conditions. Given this improvement, we are focusing on the ProTek based formulations as our lead clinical candidate.

We envision our initial commercial product will be a refrigerated liquid formulation of glucagon with at least 18 months of stability, presented in an auto injector which is easy to use, requires minimal training, and has needle stick protection.

We continue to optimize the ProTek based formulations and presentations, and are hopeful that we can also introduce a room a temperature stable rescue product. As our development of the glucagon product presentation continues to progress, so too does our knowledge of the potential markets we plan to address and expand. The current glucagon market for the treatment of severe hypoglycemia is approximately $125 million annually in the U.S.

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