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Affymax, Inc. at Citi Biotech Day - Final.

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YARON WERBER, ANALYST, CITIGROUP: Welcome everybody once again to the fourth annual Citi Biotech day here in New York. It's great to introduce Paul Cleveland who is the Chief Financial Officer of Affymax.

Affymax is a company outside of San Francisco with the next generation synthetic version of (inaudible) that recently completed dosing in four different -- completed enrollment in four different studies, both in pre-dialysis and dialysis and we're waiting anxiously for the data in early 2010. Based on the (inaudible) data it actually looks very, very good.

So, Paul, thanks very much for joining us. We appreciate it. Let me turn it over to you maybe for a few minutes, prepared remarks, and then we can go to Q&A.

PAUL CLEVELAND, CFO, AFFYMAX, INC.: Great, thank you very much, Yaron, and I do want to thank you for having us here at the conference and thank all of you for hanging in there late in the day after a lot of presentations. I appreciate your interest in Affymax.

As Yaron said, we're now in Phase III trials for a drug called Hematide. Hematide is what's called an erythropoiesis stimulating agent, ESA. It treats anemia. Our drug would be an improvement on existing ESA's which in the US are marketed by only two companies, Amgen and J&J.

Amgen makes all of them and it's licensed at J&J. Those drugs are (inaudible) PROCRIT and Epogen. We are in Phase III programs in two indications for use in pre-dialysis and for use -- that is patients with chronic kidney disease not yet on dialysis -- and for use in dialysis patients.

And those trials are going to be completed with last patient, last visit later this year. We will as Yaron said, we will have comprehensive data released in Q1.

One of the unusual elements about these trials is that they're all interrelated. While each of them stand-alone is actually overpowered for efficacy, they all need to be combined to produce enough statistical power to demonstrate safety.

We will be the only ESA that will have a safety endpoint as part of our clinical program, but it does require that all four be put together. So even though the first trial will be completed at the end of July, we will not be releasing data on any of them until they're all done and all of the data has been scrubbed and analyzed.

So we have a couple of advantages over existing ESA's, the most important of which is we are a true once-a-month drug. We can be administered to all these patient classes once a month. In dialysis, as an example, the monopoly drug is Agmen's Epogen. It is given in the United States today 13 times a month.

Our drug is not a protein and we are seeking room temperature stability for our drug which would also be unique, and that is partially possible because our drug is not a protein, it's a peptide. We do not cause a disease called pure red cell aplasia which is a very rare, but very severe disease. And in particular in Europe, physicians and patients are aware of this disease because there was an outbreak due to J&J's EPREX not that many years ago.

So we have a compassionate use program. We not only do not cause pure red cell aplasia, but we are actually the only available treatment for it. We give it to patients in Europe, and instead of requiring constant transfusions, they get a once-a-month injection of our drug and it treats their disease and their anemia.

So that's kind of my quick overview. We do anticipate filing an NDA in the second half of next year if all goes according to plan, and that would imply FDA approval in 2011 and product launch late in 2011.

We have partnered this drug with Takeda Pharmaceuticals, but we will have a major role, in fact a primary role in commercial sales of this drug in the United States in both pre-dialysis and dialysis and we have a 50-50 profit split in the United States. Takeda is responsible for ex-US regulatory approvals and Takeda will pay us a royalty on ex-US sales and do those sales outside the US. That's the essence of the arrangement, probably more than you wanted. Throw it open for some questions.

YARON WERBER: Let me ask you, the 50-50 (inaudible) split in the US, does that mean that you are on the hook for 50% of the detailing as well and 50% of the expenses or how does that -- how does your (inaudible) actually work?

PAUL CLEVELAND: Yes, and I should've elaborated. But yes -- the answer to that question is yes we are. During the development phase that we're in now, Takeda is paying for 70% of our out-of-pocket development costs for our Phase III program. That's out-of-pocket, let me underline. They do not pay for our corporate overhead and salaries and all of those things.

But in the commercial phase when we launch the drug, we will have a single combined P&L and it doesn't matter whose sales person it is or whose marketing person it is. It all gets thrown into a single combined P&L. Takeda will book gross product revenues. From that will be subtracted all the sales expense as COGS and then there will be...