US Road Show. August, 2013

Transcription

1 US Road Show August,

2 Safe Harbour Statement This presentation may include forward-looking statements that are based on our management s beliefs and assumptions and on information currently available to our management. The inclusion of forward-looking statements should not be regarded as a representation by Cosmo that any of its plans will be achieved. Actual results may differ materially from those set forth in this presentation due to the risks and uncertainties inherent in Cosmo s ability to develop and expand its business, successfully complete development of its current product candidates and current and future collaborations for the development and commercialisation of its product candidates and reduce costs (including staff costs), the market for drugs to treat IBD diseases, Cosmo s anticipated future revenues, capital expenditures and financial resources and other similar statements, may be "forward-looking" and as such involve risks and uncertainties and risks related to the collaboration between Partners and Cosmo, including the potential for delays in the development programs for Budesonide MMX, Rifamycin SV MMX, Methylene Blue MMX and CB No assurance can be given that the results anticipated in such forward looking statements will occur. Actual events or results may differ materially from Cosmo s expectations due to factors which include, but are not limited to, increased competition, Cosmo s ability to finance expansion plans, the results of Cosmo s research and development activities, the success of Cosmo s products, regulatory, legislative and judicial developments or changes in market and/or overall economic conditions. Cosmo assumes no responsibility to update forward-looking statements or to adapt them to future events or developments. You are cautioned not to place reliance on these forward-looking statements, which speak only as of the date hereof, and Cosmo undertakes no obligation to revise or update this presentation. 2

3 Cosmo Pharmaceuticals: Company Snapshot Profitable, rapidly growing specialty pharmaceutical company with proprietary drug delivery technologies Founded 1997; 2007 completed IPO on Swiss Stock Exchange (SIX:COPN), raising 30 m. Focus on gastrointestinal and dermatological diseases Current market cap ~ US$ 1100 m 2 key marketed products (one recently launched), 2 additional products in phase III and one in phase II 161 employees including 116 in production and 26 in R&D 146.3mm in cash and equivalents as of 1H2013 3

4 Cosmo Pharmaceuticals: Investment Highlights Validated colonic specific drug delivery platform to create best-inclass therapies for inflammatory bowel diseases (IBD) 2 products in market for mild to moderate Ulcerative Colitis using proprietary MMX technology Strong Commercial partnerships with Shire, Santarus, Ferring, Falk and Valeant Attractive royalties rates, manufacturing revenues and commercial based milestones Attractive mid and late stage product pipeline in GI and dermatology Key catalysts in 2014 On the cusp of strong revenue growth coupled with very high earnings potential Historically profitable with increasing royalty and manufacturing revenues 4

5 Cosmo Pharmaceuticals Developed and monetized a new colonic specific drug delivery technology (MMX) to create new drugs using existing chemical and biological entities: > probability of success, < risk Improve efficacy Improve compliance Improve safety How did we get here? Establish ways of entrenching the market position Increasing range of patents Exclusive in-house manufacturing of all MMX products Know your strengths and focus on areas of expertise Colon and topical applications Development and manufacturing 5

6 MMX technology at a glance: proof of advantage 1h 30 duodenum 4h 30 ascending colon 7h 30 trasverse colon 6 10h trasverse colon 16h descending colon 24h rectum

7 Product and Indication Drug type Phase I Phase II Phase III MA Launch Partner Lialda / Mezavant /Mesavancol Mild to moderate Ulcerative Colitis 5-ASA USA EU Giuliani-Shire Zacol NMX Intestinal Disorders (nutraceutical) Dietary supplement Italy Eastern Europe Dr. Falk UCERIS Santarus- USA Uceris/Cortiment Mild to moderate Ulcerative Colitis Corticosteroid Q3 HOLLAND CORTIMENT Ferring Worldwide (excluding Japan & USA) Rifamycin SV MMX -Travellers Diarrhoea -Uncomplicated diverticulitis Antibiotic EU USA EU Santarus - USA Dr. Falk Europe & Australia (excluding Italy) CB Chromendoscopy for colorectal cancer prevention in surveillance patients - Chromoendoscopy for colorectal cancer prevention in UC patients Diagnostic CB (NCE) Acne Steroid ester, androgen antagonist Licensed out world wide Medicis/Valeant CB (NCE) Alopecia Steroid ester, androgen antagonist Licensed out world wide Medicis/ Valeant LMW Heparin MMX - Induction of remission in UC Biologic - Maintenance of remission in UC CB Opioid Induced Constipation Opioids Antagonist

8 Focus on IBD, a disease with little recent innovation Imurek*: 1981 Sandimmun*: 1983 Sandimmun Neoral* : 1995 Uceris Prednisolone: late 50 s Budenofalk : 1998 Entocort EC *: 2001 SEVERE (1) Surgery Immunosuppressants Corticosteroids LMW Heparin MMX Remicade*: 1999 Humira*: 2003 Tysabri*: 2008 Lialda /Mezavant /Mesavancol Launch date: 2007 Aminosalicylates Asacol*: 1992 Rifamycin SV MMX (5-ASA) Pentasa* : 1993 Flagyl*: 1963 Colazal*: 2000 Ciproxin*: late 80 s Xifaxan*: 2004 Diet (+ Probiotics) Zacol NMX MILD (1) 1. Status of disease severity EU * US Methylene Blue MMX 8

9 First MMX product in market: Lialda Prior to Lialda : Total of ASA tablets of 250 mg taken three times a day now: 3-4 tablets of 1200 mg taken at once In m Shire revenue in m $ Royalties for Cosmo Manufacturing income for Cosmo Total Cosmo income ,2 2,7 3, ,6 14,5 26,1 H ,8 7,2 13,0 9

10 Parameters of Lialda 24% share of the 5-ASA market and growing Cosmo is sole manufacturer at indexed prices Requirements for attainment of bioequivalence are very challenging 10

11 ASA Market: mid size market, continuous growth ~ patients in USA; ~70% mild to moderate $ 1.7 billion; 7% growth p.a. 2% 2% 10% 4% 16% 24% 30% 12% Asacol Asacol HD Lialda Pentasa Apriso Sulfa Generic Mesalamine All Other 11

12 Second MMX product in market: Uceris * Locally acting steroid with MMX colonic delivery Steroids are more effective than 5-ASAs but they generally have a vastly inferior safety profile No steroid was approved for use in mild to moderate ulcerative colitis Uceris is corticosteroid with local effect, avoiding significant side effects of systemic corticosteroids FDA approved on January 14, 2013 for induction of remission in patients with active, mild to moderate ulcerative colitis Only steroid approved for mild to moderate ulcerative colitis Commercial launch commenced mid-february, *Please see for full prescribing and safety information; Budesonide MMX formulation: Uceris in US, Cortiment in EU

13 Unique position of Uceris Disease severity at presentation Cyclosporine Thiopurine Anti-TNFα Anti-TNFα Severe Moderate Uceris Systemic Corticosteroids 5-ASA / Thiopurine 5-ASA 5-ASA Mild Induction Maintenance Step-up according to severity at presentation or failure at prior step Kornbluth and Sacher, Am J Gastroenterol 2010; 105:

14 USPs of Uceris and expectations Known factors help marketing MMX technology is well known amongst gastroenterologists: Lialda has a satisfaction rating from gastroenterologists ~ 20% higher than 5-ASAs Gastroenterologists know that steroids are more effective than 5-ASAs Time to symptoms resolution is much faster than with 5-ASA s This is likely to increase proportion of newly diagnosed patients that get prescribed Uceris In 6 weeks to March 31: $ 6.6 m net sales on 2200 prescriptions; in half year Analysts project peak sales > $ 300 m Economics: 22% up to sales of $ 120 m, 24% above that, $ 5m at net sales of $ 75m and $ 17.5m at net sales of $ 150m 14

15 Budesonide MMX outside US Cortiment obtained Marketing Authorization in The Netherlands in January 2013 and market introduction planned for Q3 13 Marketing authorization transferred to Ferring MRP planned to obtain the MA in the other EU countries by 1H 14 Intention to submit a MA in Canada, Mexico and South America, Middle East and Far East within the year end. Unlicensed in Japan 15

16 Rifamycin SV MMX : Infections Colitis and Travellers diarrhoea Cost borne by partners Santarus (US) and Dr. Falk Pharma (EU) Pivotal Trial US: Phase III clinical end point (superiority to placebo in travellers diarrhoea) in US trial attained Designated as New Chemical Entity by FDA in USA Pivotal Trial EU: Diverticulitis Non inferiority to Cipro Indian authorities approved continuation of phase III infectious colitis trials. 250 patients to be recruited as soon as monsoon ends o. Delay could go into H More than 60% of people over the age of 60 have diverticulae In 10-20% of cases the diverticula get infected and inflamed No drug is currently approved for this disease Falk has started recruiting in phase II trial for non complicated diverticulitis in EU Unlicensed in Asia, Africa, Latin America 16

17 Methylene Blue MMX ; a logical move into diagnostics Chromoendoscopy is effective but infrequently performed because it is time consuming, messy and thus too costly Tabletise methylene blue Patients take tablets prior to colonoscopy MMX ensures it is not absorbed in stomach and ileum and brings vital dye methylene blue to colon in random staining process 17

18 Colon Cancer Economics 7 MMs have 760 m population; ~ 35% over fifty years old > new colon cancer diagnoses every year in 7 MMs 60% of colon cancers are detected in a late stage > deaths of colon cancer each year in 7 MMs Average cost to treat a colon cancer medicare patient: $ Average cost to treat a late stage patient: $ Cost of a colonoscopy: ~$ 1200 Average time of a colonoscopy: minutes Average white light polyp detection rate: 44-49% Average white light adenoma detection rate: 27-32% 18

19 US Colonoscopy market dynamics 14 m colonoscopies Approx 7 m in large hospitals Around 10 % of colonoscopies in large hospital systems are chromoendoscopies Cost of a single use spray catheter: $ 80 chromoendoscopy takes twice as long 1 m emergency colonoscopies 6 m colonoscopies in private practices Practically no chromoendoscopies in private practices According to a survey by Braintree, the leading colon prep company in the USA, all private practice gastroenterologists would use a dyeing agent if it is not as complicated and messy as chromoendoscopy 19

20 20 Identifying dysplasia via Chromoendoscopy

21 21 Making pit patterns visible

22 22 Methylene Blue application with MMX tablets

23 23 Methylene Blue MMX penetrates cells

24 Study CB-17-01/05: DETECTION RATES Number and proportion of subjects with detected polyps, adenomas and serrated lesions by colonic region in the FAS population (N=96 Methylene blue MMX tablets Population Colonic region Subjects with at least one polyp n (%) Subjects with at least one adenoma n (%) Subjects with at least one serrated lesion n (%) All regions 61 (63.5) 45 (46.9) 26 (27.1) Right colon 32 (33.3) 24 (25.0) 9 (9.4) FAS (N=96) Caecum 14 (14.6) 13 (13.5) 2 (2.1) Ascending colon 16 (16.7) 10 (10.4) 5 (5.2) Hepatic flexure 9 (9.4) 7 (7.3) 2 (2.1) Transverse colon 12 (12.5) 8 (8.3) 4 (4.2) Splenic flexure 6 (6.3) 5 (5.2) 0 (0.0) Descending colon 7 (7.3) 4 (4.2) 3 (3.1) Sigmoid 21 (21.9) 12 (12.5) 8 (8.3) Rectum 19 (19.8) 9 (9.4) 12 (12.5) 24

25 Adenoma detection rates: comparison with published data MB-MMX NBI metaanalysis GIE 2012 i-scan GIE 2012 Split-dose GIE 2012 Screening Berlin Gut

26 Methylene Blue MMX : next steps and timeline FDA approved phase III clinical trial design after a SPA in June; EMA previously approved trial design and is now requested to approve amendments Phase III in 12 well known large hospitals with endoscopy specialization in USA and Europe Phase III completion expected latest H

27 Unique treatment proposition and mechanism of action of CB Hypothalamus LHRH Pituitary LH FSH Testicle LHRH Analogues, Inhibitors Cyproterone ac. Adrenals testosterone 5a reductase DHT Finasteride, Dutasteride, Progesterone CB-03-01, Cyproterone ac., Flutamide Receptor 27 Skin and skin appendages

28 CB in 2012 and onwards 360 patients to be enrolled in acne trial, 4 cohort phase II increasing dose study Second cohort completed, third cohort recruiting, no major adverse events to date Alopecia trial amendments due to change in formulation Completion of toxicological studies ongoing Phase I PK ongoing (treatment completed) Valeant acquired Medicis and reaffirmed major strategic interest Next milestone At end of phase ll $ 20 m (expected H1 2014) depending on successful outcome POC alopecia $ 10 m (expected H1 2015) 28

29 Strong Intellectual Property Protection Product MMX MESALAZINE MMX EP / US 7,431,943 EP / US 6,773,720 EP US 7,431,943 US 8,293,273 RE 43,799 E Italy Eastern Europe BUDESONIDE MMX RIFAMYCIN SV MMX EP / US 8,263,120 METHYLENE BLUE MMX LMWH MMX EP EP ZACOL- ZACOFALK EP / US CB granted pending

30 Future developments Selective business development in non systemic treatment of gastro and skin diseases Continue controlling all manufacturing of MMX applications Develop a protein, peptide and MAB MMX application for gastro diseases 30

31 The Santarus investment Took Santarus shares in lieu of cash in 2008 Per Cosmo Technologies owned respectively 12.2% of SNTS shares which were purchased at a price of 1.77 per share ie 13.9 m Per SNTS shares were sold for $ in an accelerated book building in the US. Gross proceeds reached $ 89.2 million or 69.3 million, the net realized gain amounted to 58.2 million Present holding is shares amounting to 4.63% of outstanding shares 31

32 Shareholder structure and treasury shares Total shares outstanding: Cosmo Holding (Ajani family) and management control shares or 50,1%, dievini Hopp or 10,3% and Herz family & Logistable or 7,7% Company holds treasury shares in books, purchased at ESOP consists of options exercisable at CHF 22 and expiring in April

33 Steady financial development since IPO million Revenues 15,2 59,5 26,6 R&D Cost 3,9 10,9 5,8 Total Cost 13,8 33,1 19,9 Operating Result 1,4 26,4 6,7 Net Income -0,3 19,3 63,3 Cash & Financial Assets 2,3 93,4 146,3 Inventory & Receivables 4,1 8,4 11,5 Total Assets 25,3 151,8 207,3 Equity 4,7 124,6 182,2 Debt 10,7 12,8 12,7 Payables 4,9 4,0 5,4 Other liabilities 5,0 10,3 7,0 33

34 Cosmo Pharmaceuticals: Investment Highlights Profitable, rapidly growing specialty pharmaceutical company with proprietary drug delivery technologies Validated colonic specific drug delivery platform to create best-inclass therapies for inflammatory bowel diseases (IBD) 2 products in market for mild to moderate Ulcerative Colitis using proprietary MMX technology Strong Commercial partnerships with Shire, Santarus, Ferring, Falk and Valeant Attractive royalties rates, manufacturing revenues and commercial based milestones Attractive mid and late stage product pipeline in GI and dermatology Key catalysts in On the cusp of strong revenue growth coupled with tremendous earnings potential Historically profitable with increasing royalty and manufacturing revenues

35 Cosmo Pharmaceuticals Information Number of shares: 14,995,743 Listing: SIX Swiss exchange, Main board ISIN: IT Contacts Mauro Ajani, CEO Chris Tanner, CFO ph: Giuseppe Cipriano, COO Luigi Moro, CSO 35