Jazz Pharmaceuticals plc (JAZZ)

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Jazz Pharmaceuticals Inc. (JAZZ)

Q2 2008 Earnings Call Transcript

August 07 2008 5:00 pm ET


Matthew Fust - CFO

Dr. Sam Saks - CEO

Bob Meyers - President


Rich Silver - Lehman Brothers

Marc Goodman - Credit Suisse

Oren Livnat - Natixis Bleichroeder

Phillip Perram - Bridge Partners



Good day, ladies and gentlemen and welcome to the second quarter 2008 Jazz Pharmaceuticals, Inc. earnings conference call. My name is Amanda and I will be your coordinator for today. At this time, all participants are in listen-only mode and we will be facilitating a question-and-answer session towards the end of this conference. (Operator Instructions) As a reminder, this conference is being recorded for replay purposes.

I would now like to turn the presentation over to your host for today's call, Mr. Matthew Fust, Chief Financial Officer. Please proceed, sir.

Matthew Fust

Thanks and welcome to our second quarter financial results conference call. With me here today are Dr. Sam Saks, our CEO, and Bob Meyers, our President. Following some prepared remarks, we will open the call up to Q&A.

Our second quarter financial results press release was issued earlier this afternoon and is also available at our website. And I'll remind you that remarks we may make on this call about future expectations, plans or the prospects for Jazz Pharmaceuticals constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and our actual results may differ.

I'll ask Bob to begin today's call with an update on our commercial activities.

Bob Meyers

Good afternoon, everyone, and thank you for joining us today. The first half of this year has been transforming for our Company. We've successfully launched Luvox CR. At the same time, we are continuing the strong growth trajectory for Xyrem.

I'll begin today with update on our progress for the launch of Luvox CR. Our sales representatives and our marketing activities are focused on highlighting the key features of Luvox CR. Most importantly, its proven efficacy in treating both obsessive compulsive disorder, or OCD, and social anxiety disorder, or SAD, two chronic and debilitating anxiety disorders, as well as Luvox CR's once daily dosing and its favorable tolerability profile, the weight neutral profile and a low incidence of sexual adverse events in our clinical trials.

Luvox CR'S tolerability profile is particularly important in light of recently published updates to the practice guidelines for OCD, which recommend increasing doses to levels that might not be tolerated with other therapies.

As we review IMS prescription data, it is important to remember that it's still early in the Luvox CR launch. Overall, looking at the [dilutive] quantity of weekly IMS prescription data currently available, we're currently tracking somewhat lower than our expectations.

According to NPA weekly data from IMS, from the time that our sales force started promotion in mid April through the week ended July 25th, which is the most recent weekly data that is available, approximately 8,600 prescriptions have been written for Luvox CR.

In July, the number of Luvox CR prescriptions reported by IMS grew significantly by approximately 50% compared to June. Not surprisingly, the majority of these prescriptions are new prescriptions for Luvox CR. In recent weeks, we're starting to see an increasing level of refill prescriptions.

As we evaluate the success factors of the launch of Luvox CR, we're looking at both quantitative and qualitative data. I'll take a few minutes now to review some of that information. First and foremost, we have a very experienced and motivated sales team. Our specialty sales representatives have an average of more than nine years sales experience with a focus on selling experience to specialty physicians.

Since our launch, our sales team has completed more than 64,000 sales calls on more than 24,000 physicians, focusing on targeted high value physicians in each of the 175 sales territories. Through the end of July, the top 25 target physicians in each sales representative's territory have received an average of four sales calls.

In the second quarter, we initiated our physician speaker program for Luvox CR. These programs involve trained clinicians or moderators who speak about SAD or OCD and, as appropriate, their own clinical experience with Luvox CR.

During the second quarter, we conducted approximately 200 of these physician speaker programs and we are continuing these important programs with more than 300 programs planned for the second half of this year. We expect that the impact of these programs will be seen in increasing Luvox Cr prescriptions in the fourth quarter of 2008 and beyond.

A key component of our overall launch strategy has been making Luvox CR samples available to physicians and patients. Our sample program is intended to encourage physicians to initiate Luvox CR therapy as well as to support the titration of Luvox CR to the appropriate maintenance dose for each patient.

Since the launch commenced in mid April, our sales team has distributed more than 225,000 one-week sample packs, or roughly the equivalent of 55,000 months of Luvox CR samples. While this heavy sampling does have a negative impact on the IMS prescription data, we are hearing encouraging qualitative feedback from our sales team regarding the positive flow of samples in the offices of physicians and that trial of Luvox CR is leading to successful Luvox CR treatment and is translating into increasing commercial prescriptions.

On the managed care front, we are pleased that we are exactly where we expected to be in ensuring access and reimbursement for Luvox CR. As expected, most managed care plans have placed Luvox CR on Tier III formulary status and this status puts Luvox CR on a similar level with other branded products in this therapeutic category.

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