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Avanir Pharmaceuticals, Inc. (AVNR)

UBS Global Life Sciences Conference Call

September 20, 2012, 11:30 am ET


Randall Kaye - SVP, Medical Affairs & CMO



Unidentified Analyst

And thank you for coming to the 2012 UBS Global Life Sciences Conference. My name is [Natalia Medina] and I am happy to be your host for this session. Our next presenter will be Randall Kaye, Chief Medical Officer from Avanir Pharmaceuticals. A breakout session in [Julliard], which is one floor below, will follow immediately after the presentation. Thank you.

Randall Kaye

Thank you and good morning everyone. Before I get started, I would like to call your attention to our forward-looking statement and encourage you to look at our publicly available documents. I am Chief Medical Officer at Avanir; I joined the company in early 2006 and enjoying to build a special type of organization. Over the last six or seven years, we have dramatically changed as a company by focusing and becoming a specialty biopharmaceutical company focusing on CNS therapeutics.

Our first and only in class therapeutic NUEDEXTA for pseudobulbar affect was approved about a year and a half ago. This provides a very large market opportunity with high unmet medical need, so I’ll spend some time talking about that over the course of the discussion today and what sets this compound apart is its dual mechanism of action working through NMDA, as well as sigma-1. This sets up some very interesting follow on potential indications ranging from central neuropathic pain and multiple sclerosis, agitation in Alzheimer’s disease and diabetic peripheral neuropathic pain. Overall, as an organization, we were growing revenue line of a strong balance sheet and importantly global rights to NUEDEXTA. So I will spend some time also talking about European opportunities to NUEDEXTA with a recent response to EMA for a 120-day filing.

Let me begin with an overview of NUEDEXTA as a first and only FDA approved therapy for pseudobulbar affect. NUEDEXTA is an interesting and innovative combination of two well known compounds dextromethorphan as well as quinidine. What makes it novel is the approach is relatively simplistic in its design of utilizing quinidine, a known metabolic inhibitor to dramatically change the bioavailability of dextromethorphan.

When you look at the pharmacokinetics of dextromethorphan on the right hand part of the screen with no quinidine on-board patients readily metabolize dextromethorphan with no appreciable amounts on better bioavailable with a small amount of quinidine added in this case 10 milligrams; it’s about 1% to 3% of the typical antiarrhythmic dose dramatic increases in bioavailability. What that does with this simple technique is unlocks the potential capabilities of dextromethorphan in terms of its interactions with some of the key receptors.

And while we don’t have a complete understanding yet of the exact mechanism by which NUEDEXTA exerts its therapeutic effects, what we do know is that it has the ability to modulate glutamate in a variety of different ways. NUEDEXTA acts on a sigma-1 receptor pre-synoptically by inhibiting glutamate at least impacts sigma-1 post-synoptically at a receptor level by modulating the response of the NMDA receptor.

And then thirdly, NUEDEXTA interacts with the NMDA receptor by blocking the receptor from having any interaction. So these three hits at modulating glutamate have the ability of opening up a variety of different therapeutic options that can be studied for NUEDEXTA.

On this slide you see a list of the potential utility in a lot of different areas of potential research ranging from pseudobulbar affects, agitation, neuropathic pain as you go around the horn and looking at some other areas of movement disorders and chorea depression, autism memory and cognition; all of these being areas in which modulation of glutamate or an impact on sigma-1 or NMDA have an impetus potential therapeutic modalities.

These open up some significant market opportunities with some slight but important differences and pseudobulbar affect first indication for NUEDEXTA large potential market place with nearly 2 million patients in the United States alone; some potential of in excess of $1 billion in revenue and stage development obviously approved. This is a new market; this is a therapeutic area while PBA has been described in a literature for literally 100 years, there has been no potential treatment option. So I can tell you as a prescribing physician, this open up an interesting opportunity because most prescribing physicians were not in the habit of treating PBA, patients of PBA would present and by and large it would be managed pharmacologically. So I’ll spend some time giving you a little more of an overview of what’s occurring in that area as well.

The other two areas agitation in Alzheimer’s disease central neuropathic pain in MS, these are established markets and as established path forward potentially in how these compounds are developed and there is current utilization in these broad areas. In agitation in Alzheimer’s disease there is common use of off label for the typical antipsychotics, a lot of that is starting to change with the impact in the long-term care environment by CNS and hundreds of Medicaid in terms of reducing the utilization of antipsychotics in that areas. So this opens up within the established market place an opportunity to meet the high unmet medical need in central neuropathic pain conditions such as in patients with amasses that are in established market place probably still having a significant unmet medical need with no medications currently approved in that area.

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