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BioMimetic Therapeutics, Inc. (BMTI)

Q2 2008 Earnings Call Transcript

August 11, 2008 4:30 pm ET


Kearstin Patterson – Associate Director, Corporate Communications

Samuel Lynch – President and CEO

Larry Bullock – CFO

Timothy Daniels – Associate Professor of Orthopedic Surgery, St. Michael's Hospital, University of Toronto

Steven Hirsch – COO and EVP of Orthopedics


Imron Zafar – Deutsche Bank

Vincent Ricci – Wachovia Capital

Erica Selin – Stanford Group

Bill Plovanic – Canaccord Adams

Greg Wade – Pacific Growth Equities

Debjit Chattopadhyay – Boenning & Scattergood

Amrit Nagpal – Weintraub Capital



Good day, ladies and gentlemen and welcome to the second quarter 2008 BioMimetic Therapeutics earnings conference call. My name is Gwen and I will be your operator for today. At this time, all participants are in listen-only mode. We will conduct a question-and-answer session toward the end of this conference. (Operator instructions)

I would now like to turn the call over to Ms. Kearstin Patterson, Associate Director of Corporate Communications for BioMimetic Therapeutics Incorporated. Please proceed, ma'am.

Kearstin Patterson

Thanks, Gwen. Before we begin, I would like to remind you that any statements made during this call can be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on the current intent and expectations of the management of BioMimetic Therapeutics. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. There are many important factors that could cause actual results to differ materially from those indicated in the forward-looking statements. BioMimetic's actual results and the timing and outcome of events may differ materially from those expressed in, or implied by, the forward-looking statements because of risks associated with the marketing of BioMimetic’s products, unproven pre-clinical and clinical development activities, regulatory oversight, and other risks detailed in the Company's filings with the Securities and Exchange Commission. Except as required by law, BioMimetic undertakes no responsibility for updating the statements made during this call.

Please note that for your convenience this conference call will be webcast and archived on the ‘Investor Information’ section of our website for at least 30 days.

Now, I would like to hand the call over to Dr. Samuel Lynch, President and CEO of BioMimetic Therapeutics.

Samuel Lynch

Thank you, Kearstin and good afternoon everyone, and welcome to BioMimetic Therapeutics 2008 second quarter earnings conference call. I have with me on the call today Larry Bullock, our CFO, and Steven Hirsch, our COO, and Dr. Charles Hart, our Chief Scientific Officer.

We're also fortunate to have Dr. Timothy Daniels, who will be joining us also on the call today. Dr. Daniels is Associate Professor of Orthopedic Surgery at St. Michael's Hospital in the University of Toronto, and is the lead investigator in our foot and ankle trial investigating our second orthopedic product candidate, Augment Injectable Bone Graft, as well as an investigator in our ongoing Augment Bone Graft pivotal trial. Dr. Daniels will be available to answer questions about the data we presented on the Augment Injectable product candidate for the first time today during the Q&A portion of our call.

The first part of the call today will address our product development programs and business activities, which will then be followed with Larry providing an update of our financial results for the second quarter of the year ending June 30, which were released this afternoon. We, along with Dr. Daniels, will also be happy to answer any questions you have during the Q&A portion at the end of the call.

This quarter we also unveiled a new brand name for our portfolio of orthobiologic product candidates. We announced that the Augment brand name will replace the GEM family of trademarks. Specifically, Augment Bone Graft will replace GEM OS1 and Augment Injectable Bone Graft will replace Gem OS2. You will see these new brand names reflected throughout all of our communications hereafter, and you will hear them used repeatedly on the call today. We will also discuss this transition in more depth later on the call.

So let's take a look first at our Augment Bone Graft product candidate. We are progressing this product candidate nicely, including applying for product approval in Canada, and completion of our ongoing studies in the U.S. and the EU. Let me first talk about the most important issue for our Company. That is the enrollment in our ongoing pivotal clinical trial. In our earnings press release issued this afternoon we announced that as of August 8, 220 patients have been enrolled in our U.S. pivotal trial on the Augment Bone Graft product candidate, which we are developing as a replacement for autogenous bone graft for the treatment of foot and ankle fusions.

While we are showing steady progress, the rate of enrollment has been somewhat slower than we had hoped. There appear to be three main reasons for this. First, we've seen a substantial slowdown over the past two months as a result of summer vacation schedules. Second, the worsening overall economy appears to have resulted in a decrease in the number of elective procedures in many hospitals. And third, believe it or not, the price of gasoline has increased patient concerns about the multiple followup visits required for the study.

Last quarter, though, we outlined some of the steps that we intended to take to directly address these issues, and we've now implemented those initiatives. We've hired a team of clinical specialists that are working directly with the sites to identify and overcome obstacles in patient screening, consent, and enrollment. We've implemented a physician-to-physician referral program to facilitate the referral of potential study candidates directly from general family practitioners to the foot and ankle specialist participating in our study. And we've applied to the IRBs to increase the reimbursement rate for patients' travel expenses.

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