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Santarus, Inc. (SNTS)
Q2 2011 Earnings Call
August 3, 2011 5:00 pm ET
Martha Hough – VP, Finance and IR
Gerry Proehl – President and CEO
Debbie Crawford – SVP and CFO
Tom Joyce – VP, Marketing and National Accounts
David Ballard – SVP, Medical Affairs and Pharmacovigilance
Wendell Wierenga – EVP, R&D
Mark Totoritis – SVP, Clinical Research
Frank Pinkerton – SunTrust
Annabel Samimy – Stifel Nicolaus
Scott Henry – ROTH Capital
Misha [ph] – Piper Jaffray
Alan Leong – Biotech Stock Research
Jason Aryeh – JALAA Equities
Previous Statements by SNTS
» Santarus CEO Discusses Q1 2011 Results - Earnings Call Transcript
» Santarus Management Discusses Q4 2010 Results - Earnings Call Transcript
» Santarus CEO Discusses Q3 2010 Results – Earnings Call Transcript
» Santarus Inc. Q2 2010 Earnings Call Transcript
As a reminder, this conference is being recorded today, August 3, 2011. I would now like to turn the conference over to Martha Hough. Please go ahead, ma’am.
Thank you, Kristine [ph]. Good afternoon and welcome to today’s call. This is Martha Hough, Vice President of Finance and Investor Relations. Joining me on the call today are Gerry Proehl, President and Chief Executive Officer; Debbie Crawford, Senior Vice President and Chief Financial Officer; Tom Joyce, Vice President, Marketing and National Accounts; and Dr. David Ballard, our Senior Vice President, Medical Affairs and Pharmacovigilance. Wendell Wierenga, our recently appointed Executive Vice President of Research and Development; and Dr. Mark Totoritis, our Senior Vice President, Clinical Research will also be available during today’s question-and-answer session. Bill Denby, our Senior Vice President of Commercial Operations is unavailable for today’s call.
Earlier today Santarus issued a press release announcing our second quarter 2011 financial results, which is available at our website at www.santarus.com. A replay of this call also will be available on our website and can be found in the Investor Relations section for the next two weeks.
Please keep in mind that risks and uncertainties involved in the company’s business may affect the matters referred to in forward-looking statements made by management during today’s call. As a result, the company’s performance may differ from those expressed in or indicated by such forward-looking statements, which are qualified in their entirety by the cautionary statements contained in the press release and the company’s Securities and Exchange Commission filings.
The content of this conference call contains time sensitive information that is accurate only as of the date of this live broadcast on August 3, 2011. Santarus undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call.
I’d now like to turn the call over to Gerry Proehl.
Thank you, Martha, and welcome to this afternoon’s call. I’m pleased to report that total revenues for the second quarter reached $26.6 million, putting us on track to meet our guidance for 2011 total revenues of approximately $110 million. Net income was $2.7 million for the quarter; we are raising our outlook for 2011 net income to be approximately $2 million with our previously stated guidance of GAAP breakeven.
Our commercial products performed well during the quarter, GLUMETZA prescriptions gained momentum and we are optimistic about our ability to continue growing the brand. Our share of total of new prescriptions for branded metformin market has continued to increase. As of July 22nd the GLUMETZA share was approximately 45% for new prescriptions and 40% for total prescriptions.
Net product sales of CYCLOSET increased to $7 – $1.7 million for the second quarter, up from $1 million for the first quarter. We attributed this increase to gain more physician awareness and interest in CYCLOSET, which is a quick release formulation of bromocriptine that increases dopamine receptor activity to positively affect neuroendocrine metabolic control.
We expect future growth in prescription volume as physicians’ awareness increases through our promotional efforts. In addition, at the American Diabetes Association 71st Scientific Sessions in June more than 400 healthcare professional attended a symposium focused on the role of dopamine in the brain.
This was an excellent turnout which we believe indicates physician’s interest in CYCLOSET novel approach to management of type 2 diabetes.
Second quarter net sales of our ZEGERID brand products and authorized generic product continued to contribute significant revenue. As of mid July, Prasco maintained about 50% of the generic prescription market with our authorized generic of ZEGERID Capsules. To date there is no generic version of ZEGERID powder for oral suspension.
Also of note in the second quarter GlaxoSmithKline launched its immediate-release omeprazole/sodium bicarbonate proton pump inhibitor under the trade name TRINSICA in Mexico and we are pleased to report receipt of our first royalties from this product. As a reminder, we continue to expect the ruling from the appellate court on the ZEGERID patent litigation in the second half of this year.
Turning to our late-stage development programs following immediate with the FDA, we are confirming our plan to submit a New Drug Application for budesonide MMX for the induction of remission of mild or moderate active ulcerative colitis by year end. As requested by the FDA, we will submit the data from our stem used clinical study with budesonide MMX 6 milligrams with the initial filing of the NDA.
In early May data from two Phase III clinical studies at budesonide MMX represented to overflow capacity audiences in separate oral presentations at Digestive Disease Week Meeting. If approved by the FDA, we believe that the one pill, once a day treatment with budesonide MMX will be an attractive option for the treatment of induction of remission of mild or moderate active ulcerative colitis.