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Avanir Pharmaceuticals, Inc. (AVNR)
38th Annual dbAccess Health Care Conference Call
May 29, 2013 12:00 pm ET
Keith A. Katkin – President and Chief Executive Officer
Gregory J. Flesher – Senior Vice President-Corporate Development and Chief Business Officer
Alethia R. Young – Deutsche Bank Securities, Inc.
Alethia R. Young – Deutsche Bank Securities, Inc.
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And secondarily, we have some cool apps on the Yorn that no one ever uses, but it would be nice if someone did. So I think that’s db.yorn.com. And with that I’ll turn it over to Keith. Thank you for being here.
Keith A. Katkin
Thank you, Alethia, and good afternoon, everyone. Thank you for joining us for the Avanir corporate presentation. I’d like to start with our forward-looking statement as I will be making statements that are forward-looking in nature. I would encourage everyone to look at our annual 10-K and quarterly 10-Q, it’s available on the Avanir website or on the SEC’s website.
It’s an incredibly exciting time here at Avanir. And Avanir is a uniquely positioned specialty biopharmaceutical company with a number of exciting commercial and clinical development milestones on the horizon within the next 12 months. First, our lead product, NUEDEXTA, which is the first and only FDA-approved product for the treatment of pseudobulbar affect, continues to perform quite well commercially. As the first and only FDA-approved product, we continue to see record prescriptions on a monthly basis and weekly basis with the most recent prescription numbers annualizing to over $90 million in annual gross revenues nearing the $100 million gross revenue run rate mark.
Second, NUEDEXTA really provides us with a platform, as we like to say a pipeline in a pill. Given the mechanism of NUEDEXTA, we’re able to study NUEDEXTA in a number of additional potential indications including various forms of pain, various mood and behavior disorders as well as movement disorders, and we have programs in all three of those areas currently ongoing. And we believe that combination of commercial success and a deep clinical pipeline really provides a unique proposition for Avanir.
So I’d like to start with pseudobulbar affect. Pseudobulbar affect is a condition that many people are not familiar with and it’s a condition that afflicts quite a number of Americans. We estimate that around 2 million Americans have pseudobulbar affect. So what is pseudobulbar affect? Pseudobulbar affect is uncontrolled emotional outbursts, and what we studied in our clinical studies were laughing and crying. And when you think about how natural these emotions are laughing and crying, it’s difficult to think that somebody can’t control what are these otherwise normal emotions.
And what we find is that patients that have some type of neurologic disease or injury, so stroke, traumatic brain injury, Alzheimer’s, multiple sclerosis, Lou Gehrig's Disease, a small percentage of these patients develop lesions in their brains and depending on where that lesions is, it can interrupt the emotional circuit within the brain leading to these uncontrolled emotional outbursts. In our clinical studies, the patients have between 5 and 7 outbursts per day. So we’re talking about 40 to 50 outbursts per week, and those take a quite a substantial impact on their quality of life, their ability to interact with their family and friends and quite typically leads to social isolation where the people become housebound and just do not go out and interact with other people.
So taking a look at the market for PBA and the number of patients that are out there, there is roughly 18 million patients in the United States that have some type of neurologic disease or injury. And you can see the various types of neurologic disease and injury listed across the top there. For example, there is over 5 million people in United States that have Alzheimer’s, over 5 million stroke survivors and over 5 million people that have had traumatic brain injuries. So in total, around 18 million patients have these neurologic diseases or injury.
We’ve done a number of market research studies, a number of literature searches as well as conducted 5,000 patient prospective registry to really identify the percent of patients that have pseudobulbar affect. And what we found is it’s roughly about 10% of those 18 million people in the U.S. that have moderate to severe PBA, so about 1.8 million patients. And interestingly, those 1.8 million patients can be broken down into two separate segments. You have those patients that are in the institutional setting, so these are within nursing homes and they represent about 100,000 patients. And then you have those that are in the retail outpatient setting, which represents about 1.7 million patients.
Why this is important is because we are dividing in our sales forces and our commercial efforts are being executed against these two market segments; the institutional setting as well as the retail setting, and we’re executing differently as we’ll explain in a couple of slides.