Amarin Corporation plc

Welcome to Ameren Corporation's conference call to discuss its first quarter 2021 financial results and operational updates. This conference call is being recorded today, April 29th, 2021. I would like to turn the conference call over to Alina Dubrovna, Associate Manager of Investor Relations at Ameren.

Thank you, Operator, and thank you to everyone for joining our first quarter 2021 results. Before we begin, let me turn to our forward-looking statements. Please be aware that this conference call will contain forward-looking statements that are intended to be covered under the safe harbor provided by the Private Securities Litigation Reform Act. Examples of such statements include, but are not limited to, our current expectations regarding our commercial and financial performance, including levels of VSIPA prescriptions, VSIPA product and licensing revenues, costs, gross margin, and other commercial metrics. Our current plans and expectations regarding spending, including expenditures for promotion of the SEPA and for purchase of additional supply of the SEPA. Our current expectations regarding the adequacy of our financial resources. Our current plans and expectations for product revenue growth, sales force productivity and product promotion in light of COVID-19 and the potential for added attention to cardiovascular risk reduction drugs like the SEPA as a result of COVID-19. Our current plans and expectations related to the patent litigation and expectations related to the potential supply and launch of generic versions of VSIPA by generic companies and by ourselves. Our current expectations on the substance and timing of VSIPA regulatory reviews outside the United States. Our current plans and expectations regarding the timing, scope, and success of international expansion. including expectations regarding our ability to launch VSCEPA in Europe and our expectation in China for clinical trial results and potential to bridge reduce it results in labeling and promotion of VSCEPA through our partner in China. Our current plans and expectations regarding VSCEPA exclusivity outside the United States, including Europe and China. Our current plans for commercial expansion in the United States with the entry of current and potential future generic competition, and our current plans and expectations regarding clinical study of a SEPA related to COVID-19. These statements are based on information available to us today, April 29, 2021. We may not actually achieve our goals, carry out our plans or intentions, or meet the expectations disclosed in our forward-looking statements. Actual results or events could differ materially, so you should not place undue reliance on these statements. We assume no obligation to update these statements as circumstances change. Our forward-looking statements do not reflect the potential impact of significant transactions we may enter into, such as mergers, acquisitions, dispositions, joint ventures, or any material agreements that we may enter into, amend, or terminate. For additional information concerning the factors that could cause actual reserves to differ materially, please see the Risk Factor section of our quarterly report on Form 10-Q for the quarter ended March 31, 2021, and our annual report on Form 10-K for the year ended December 31, 2020, which have been filed with the SEC and are available through the Investor Relations section of our website at www.investorrelations.com. Amerincorp.com. We encourage everyone to read these documents. This call is intended for investors in Amerin, and it is not intended to promote the use of a SIPA outside of its approved indications. An archive of this call will be posted on Amerin's website within the investor relations section. Making prepared remarks on today's call will be John Theroux, President and Chief Executive Officer, Kareem Mikhail, Senior Vice President and Head of Commercial for Europe and Planned Future President and Chief Executive Officer, and Michael Kalb, Chief Financial Officer. After prepared remarks, we will open the call to your questions. I remind you, the multiple audiences typically listen to calls of this nature, including existing investors, potential new investors, employees, current and potential collaborators, and current and potential competitors. As always, in this call, we will attempt to provide constructive information without compromising our competitive and strategic positioning. I now turn the call over to John Tharo, President and Chief Executive Officer of Ameren.

Good morning, and thank you all for joining us. As you know, we recently announced my plans to retire this year, and for our Senior Vice President and Head of Commercial for Europe, Kareem McHale, to take over as President and CEO. Karim and I have spoken with a number of you over the past couple of weeks. And while announcing my retirement is a bittersweet moment for me, I have every confidence in Ameren and its outstanding employees who are dedicated to the patients and shareholders we serve. Separately today, we announced that Joe Kennedy, our general counsel, has informed Ameren of intentions to retire from Ameren. Joe has played a pivotal role in the development of the company over the last decade, including in various past successful legal initiatives, which have enduring value for Ameren and for the pharmaceutical industry. He is one of the small number of employees who joined Ameren prior to us gaining approval from the FDA for the initial indication of a SEPA in 2012 and at the start of the REDUCE-IT study. Joe remains focused on Ameren's success and dedicated to work to ensure a smooth transition to a new general counsel and plans to continue to support the company in certain legacy legal matters as part of his plan transition. Karim, with the support of Joe and others at Ameren, including me, has commenced a search for a replacement general counsel for Ameren. The primary office location for the new general counsel is likely to be our New Jersey office. For context, of the more than 1,000 people currently working for Ameren, more than 80% joined our team in the past three years. Most of these people were added for commercialization of ASEPA in the United States, or more recently, for commercialization of ASEPA in Europe, or for managing our R&D initiatives, including the REDUCE-IT study, which initiatives expanded after Visipa was initially launched in 2013. Aside from Joe and me, only 14 of our employees were with Ameren prior to the initial approval of Visipa. Recall that we had a small team of people prior to commercialization. In recent years, Ameren has had relatively little turnover and particularly little turnover among senior management. Accordingly, While it may seem odd that both Joe and I are retiring from the company in a similar timeframe, we do not expect this to be a broadly recurring theme. Among our long tenured executive officers are Steve Ketchum and Aaron Berg. They and various others have expressed their intentions to not retire at this time and to work with Kareem to build a bigger and better Ameren. Towards that end, The Ameren team continued to make significant progress throughout the first quarter of 2021, highlighted by a number of achievements that support our international strategy to rethink cardiovascular risk. Most notably, we received market authorization from the European Commission for our unique drug, icosabanethyl, under the brand name Veskepa, for cardiovascular risk reduction. The brand name will remain VSIPA in the United States. The European marketing authorization is a major milestone for Ameren as it allows us to commence our commercial initiatives in Europe with the aim over time of helping millions of at-risk patients, which represents a multi-billion dollar opportunity for Ameren. Just last week, the marketing authorization for VSIPA in Europe was expanded to cover England, Scotland, and Wales. These regulatory approvals reflect the robust results of our clinical studies, the hard and thoughtful work of our employees, and the support of various leading physicians and other advisors. We are optimistic about our opportunities in Europe, and our next major step is market access. We also remain excited about our opportunities in the United States and the rest of the world. Throughout the first quarter, we continued our work to build the BESIPA brand in the U.S. amidst the continued headwinds of the COVID-19 pandemic, as well as other events that impacted patients visiting their healthcare providers in certain areas of the country. We were not alone in facing these headwinds. For example, COVID appears to have slowed the growth and use of statins and other lipid therapies. Because of these headwinds and to a lesser extent because of the entry of limited generic competition, we elected to spend less on product promotion in the first quarter of 2021 compared to the first quarter of 2020. As a result of operational cost savings, our bottom line results improved in the first quarter of 2021 despite a modest and hopefully temporary decline in reported revenue. In the United States, our net product revenue for the three months ended March 31st, 2021 and 2020 were $140.8 million and $145.5 million, respectively, a decrease of 3%. This decrease was driven primarily by the effects of one, COVID-19, two, severe weather and related power outages in various parts of the United States, three, generic competition, and four, effectively one fewer week of shipments in the first quarter of 2021 as compared to the first quarter of 2020, which, as reported in 2020, added approximately $10.8 million to net product revenue in the first quarter of 2020. This anomaly as expected was not repeated in 2021. Net product revenue in the first quarter of 2021 was also impacted by our decision to reduce our level of promotional activities. Mike Cobb, our CFO, will speak in more detail regarding these factors later in this call. We also know that the first quarter of each year is historically a challenge due to seasonal factors that are not Vespa specific, but rather impact many medications. In particular, in Q1 of each year, some patients elect to not fill their prescriptions due to beginning of the year deductible limits under their insurance plans. Such deductible limits go into effect at the beginning of each calendar year under many insurance plans, creating added financial burden for patients. Drugs used for asymptomatic conditions, including Vespa, tend to be the most impacted. As Mike will also discuss later in this call, our Vespa franchise in the United States was profitable in the first quarter of 2021, and along with our strong balance sheet, continues to support our global expansion plans. We remain optimistic regarding the opportunity for U.S. BSEPA growth in the future. There continues to be millions of at-risk patients who are candidates for the cardioprotective benefits of BSEPA. Awareness of BSEPA remains low. This low awareness is evident both in opinion surveys and by broad use of competing products that have failed outcome studies. The data supporting the effectiveness of the CIPA is compelling. The compelling nature of this data is reflected both by regulatory approvals for the drug by the US FDA, Health Canada, and now the European Commission, and the UK regulatory body. The importance of this data is broadly published in peer-reviewed journals, and 15 medical societies globally now recommend use of icosaminethyl for cardiovascular risk reduction. While key opinion leaders and medical societies know of the CIPA's effectiveness, most healthcare professionals and at-risk patients remain unaware of the drug or lack details. As a result, for example, approximately two million people take phenofibrates, despite the fact that these products have failed outcome studies, have various side effects, and FDA revoked the indication for these products with regard to cardiovascular risk reduction in combination with a statin, as the benefit does not outweigh the risk. Yet, still today, roughly three times as many patients take phenofibrates with their failed outcome study than take the CEPA with its proven effective results. And for persistent cardiovascular risk, there are even more people taking other products such as dietary supplement fish oil preparations despite their failed results in lowering cardiovascular risk beyond statin therapy. Clearly, there is significant opportunity to educate physicians and patients about the merits of Vaseepa as opposed to failed and unproven products. More can be done to benefit patients with proven approved therapy. As you know, we launched Vaseepa for the treatment of persistent cardiovascular risk shortly over a year ago. But as with other branded agents, during most of that timeframe, our commercial efforts have been slowed by COVID-19 as healthcare professionals and patients were focused on preventing and treating COVID-19 versus preventative care for other medical concerns. Public reports from IQVIA showed patient visits to doctors on average during the first quarter of 2021 were down to approximately 78% of pre-COVID levels experienced during the first quarter of 2020. The decline in patient visits was most significant in various geographies in the United States, where prior to the pandemic, the SEPA volumes and growth were the most robust. While the effects of COVID-19 were a significant part of our decision to pull back on SEPA promotional efforts in the first quarter of 2021, that pullback is expected to be temporary. As vaccinations take hold in the United States, and the effects of COVID-19 recede, we expect to enhance our promotional efforts in the U.S. with branded and unbranded educational efforts that include digital and non-personal channels as well as peer-to-peer initiatives such as promotional medical educational programs and product theaters that further increase the BESIPA brand awareness and clarify BESIPA's unique clinical profile. Some of our non-branded initiatives such as podcasts and satellite media tours with key opinion leaders will highlight the need for at-risk patients to get back to their doctor's offices and to promote testing for cardiovascular risk. As mentioned in today's press release, we see some early signs of the effects of COVID-19 potentially receding. For example, While only roughly half of the physicians we target are now open to office visits from sales representatives, that level is roughly 8% higher now than it was roughly six months ago. We recognize that trying to grow a brand in the face of generic competition is atypical. However, the generic launch with a skinny label and limited supply is atypical. Based on what is known to us currently, assuming that the effects of COVID-19 recede, facilitating market growth, we remain convinced that there is greater value to shareholders and undoubtedly to patient care for us to continue to work to increase education, grow market penetration, and seek to grow usage of branded FASIPA faster than generic competition. We understand generic companies and their suppliers have not made the investment in capacity expansion that Ameren has made. Currently, there is only one launch generic in the market, and there have been reports of inconsistent levels of supply in different areas of the United States and periodic stock outages for that product, creating week-to-week fluctuations in the level of prescriptions filled by retail pharmacies with the generic product. These fluctuations in the generic product availability impact the level of the SEPA branded prescriptions filled. While capacity for generic competition may increase over time, based upon information available to us currently, we anticipate that capacity through their current suppliers will remain a fraction of the capacity of Ameren suppliers. We continue to hear complaints from patients who have found the generic drug more expensive than branded vasepa. And various managed care companies have witnessed that the generic product on a net price basis is more expensive to them than branded vasepa. Since the generic product has been launched, overall managed care coverage for branded vasepa has continued to improve. In Q1 2021, Based upon data from Symphony Health, total prescriptions of icosapent ethyl consisting of branded and unbranded product increased by approximately 11% over Q1 2020. Of these reported prescription estimates, approximately 9% were for the generic version of icosapent ethyl. As discussed previously, Ameren filed a cardiovascular risk reduction patent infringement lawsuit against the generic manufacturer and a healthcare insurance company based upon a collection of activities by them, which we believe infringe our cardiovascular risk reduction patents for FACIPA. We have no update to provide today regarding that litigation. We refer people to our court filings for more details. Turning now to progress with our global expansion plan, It is my pleasure to turn the call over to Kareem. For those of you who don't know Kareem, he is a global commercial leader with considerable experience successfully launching cardiovascular drugs in Europe and around the world. Kareem was with Merck for 22 years where he served in leading commercial roles in seven countries across three continents and where he led Merck's multi-billion dollar Lipid franchise among other leadership roles. The board and I have every confidence that Karim is the right leader at the right time, and we are working closely to facilitate a smooth transition over the coming months. As a reminder, he has a track record of helping grow business lines in the United States, Europe, and in the rest of the world. He joined Ameren in the middle of last year, to be the head of our European commercial launch efforts. He joined us on the heels of an extensive process in which we evaluated whether it was best for Ameren shareholders for us to self-launch Vizgepa in Europe or to license such opportunity to another company. As expressed at that time, the process concluded that the greatest value was for Ameren to retain such rights and self-launch. Most investors with whom I have spoken support that decision. While I and others in Ameren were impressed with Karim before he joined us, his work at Ameren has demonstrated that he is capable of much more. He has proven that he can work in Ameren's fast-paced environment. He developed a passion for our product. He has recruited an outstanding team of people. And he has led an effort in a very short period of time which positions us well for market access negotiations. He has helped expand Ameren's relationships in Europe. He has built good working relationships with all functions of Ameren. And he has established thoughtful plans for Ameren in Europe while increasingly contributing to other aspects of Ameren's business. As you get to know him, I am sure that you will be impressed with him as well. He is in the process of recruiting a new head for Europe and Until that is complete, he will continue to fill that role while getting ready for the CEO transition scheduled for August. With that, let me turn the call to Karim to discuss our international plans.