Pacira Corporate Presentation NASDAQ: PCRX. November 2014

Transcription

1 Pacira Corporate Presentation NASDAQ: PCRX November 2014

2 Forward-Looking Statements This presentation contains forward-looking statements, within the meaning of Section 21E of the Securities Exchange Act of 1934 (collectively, forward-looking statements), about our business, including statements about our plans and expectations regarding EXPAREL. Actual results or developments may differ materially from those projected or implied in these forward-looking statements. Factors that may cause such a difference include: the success of our sales and marketing efforts in support of the commercialization of EXPAREL; the rate and degree of market acceptance of EXPAREL; the size and growth of the potential markets for EXPAREL and our ability to serve those markets; potential indications for our product candidates and the timing and likelihood of the commercialization of additional products and future financial results; the future development of product candidates and the timing thereof; results and timing of clinical trials; the adverse effects and impacts of FDA warning letters; our and Patheon s ability to successfully construct dedicated EXPAREL manufacturing suites according to current projections; and other factors discussed in the "Risk Factors" section of our most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2013 and in other filings that we periodically make with the SEC. In addition, the forward-looking statements included in this presentation represent our views as of the date of this presentation. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this presentation. 2

3 Pacira Pharmaceuticals, Inc. Unique Investment Opportunity Management Team with Successful Track Record of Product Launches Successful EXPAREL Launch in U.S. with Blockbuster Market Opportunity Scalable Business Model with Attractive Economics Global Human Market Opportunity & Strategic Partnerships DepoFoam Pipeline Limited Generic Competition 3

4 EXPAREL Uses DepoFoam to Release Bupivacaine Over Time By utilizing the DepoFoam product delivery platform, EXPAREL delivers therapeutic levels of bupivacaine for several days* DepoFoam is a multivesicular liposomal product delivery technology that encapsulates drugs without altering their molecular structure and then releases them over a desired period of time 1 DepoFoam utilizes membrane components that are based on natural and well tolerated sources and are cleared by normal metabolic pathways As incorporated in EXPAREL, DepoFoam is <3% lipid, biodegradable, and biocompatible 1. Lambert WJ, Los K. DepoFoam multivesicular liposomes for the sustained release of macromolecules. In: Rathbone MJ, Hadgraft J, Roberts MS, Lane ME, eds. Modified release drug delivery technology. 2nd ed. New York: Informa Healthcare; *As demonstrated in a pivotal soft tissue trial (hemorrhoidectomy). 4

5 EXPAREL Strategic Positioning

6 EXPAREL: FDA Approval October 28, 2011 Label provides platform for use in all surgical settings 1 Broad indication Indicated for single-dose infiltration into the surgical site to produce postsurgical analgesia 2 ~70 million surgical procedures annually in the United States ~42 million appropriate for EXPAREL infiltration ~8% share provides $1 billion revenue opportunity 3 postsurgical Clinical data analgesia in a broad range of surgical procedures provides the platform for continued rapid growth and pain control with reduced opioids Strategy of non opioid based infiltration platform for postsurgical pain control Enhanced duration of local pain control provides a reduction in the need for opioids (The Joint Commission) and an opportunity to replace elastomeric pumps, to improve quality of care (patient satisfaction/hcahps) and hospital economics 6

7 EXPAREL: New Postsurgical Pain Paradigm Injection Instructions EXPAREL should be injected slowly into soft tissues of the surgical site with frequent aspiration to check for blood and minimize the risk of intravascular injection EXPAREL should be administered using a 25 gauge or larger bore needle Ensuring a meticulous technique that covers the whole surgical site is critical to improving postsurgical analgesia. Please refer to full Prescribing Information for EXPAREL available at 7

8 Inadequacy of Current Multimodal Postsurgical Pain Treatment Paradigm Bupivacaine via Elastomeric Pump >$450 as single use durable medical equipment (DME)* Safety : adverse drug events (ADEs), premature emptying, flow rates, recalls Non-compliance when filled outside pharmacy Difficult to use patient compliance issues Requires additional: Appropriate instillation and removal Hospital resources, staff Patient education Opioids by IV Patient-Controlled Analgesia (PCA) Device >$500* without adverse events (AEs), which are common Opioid AEs increase patient length of stay (LOS), hospital resources ASHP abstracts, Pacira data Requires additional hospital resources pharmacy and nursing time for opioid pain control and opioid AEs management Delayed ambulation and discharge (LOS) *Frost & Sullivan. New Opportunities for Hospitals to Improve Economic Efficiency and Patient Outcomes ISMP Medication Safety Alert, July 2009 Postsurgical Opioid Outlier Study, Premier Research, Version 3.0 8

9 Commercial Results and Strategy

10 EXPAREL Commercial Metrics $60.0 Quarterly Sales, Millions $50.0 $40.0 $30.0 $20.0 $10.0 $0.0 $50.2 $44.9 $34.4 $30.5 $20.0 $15.2 $10.4 $7.8 $4.6 $2.3 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q3 2014: New accounts: 247 Average new accounts per week: 19 Since launch 1 : Total accounts: 3,062 Ordering >$100,000: 593 Ordering >$500,000: 80 Ordering >$1 million: 13 1.Data as of September 30,

11 EXPAREL Value Proposition Addresses a Significant Market Need 1. FDA Approval 1. P= for approval, P= for patient satisfaction 2. Patient satisfaction: Quantify the true cost of opioids as the platform for postsurgical pain control 2. Clinical data to support use in procedures of interest Hemorrhoidectomy, open colectomy, lap colectomy, ileostomy reversal, total knee arthroplasty (TKA), total joint arthroplasty (TJA), abdominoplasty, TAP infiltration procedures, hysterectomy, breast augmentation, OGBYN, reconstruction, hernia, bariatric surgery 3. Potential for additional indications (nerve block, oral surgery, chronic pain) 11 Quality and reimbursement environment supports replacing opioids The Joint Commission Alerts patients at risk for opioid-related adverse events Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) Reimbursement pain management and patient satisfaction

12 EXPAREL Utilization Data - Since Launch Cardiothoracic 3% Other 5% Orthopedic 46% Soft Tissue 46% Top Procedures Soft Tissue Hernia Anal/rectal Cholecystectomy Hysterectomy Colon Laparotomy/laparoscopy Endocrine Orthopedic Knee Hip Spine Fracture Shoulder Foot/ankle Data sourced from over 500 hospitals. Utilization data based on the Premier research database as of June 2014 since launch. 12

13 EXPAREL Utilization Data - First Six Months of 2014 Cardiothoracic 3% Other 4% Orthopedic 54% Soft Tissue 39% Top Procedures Soft Tissue Hernia Anal/rectal Cholecystectomy Hysterectomy Colon Laparotomy/laparoscopy Endocrine Orthopedic Knee Hip Spine Fracture Shoulder Foot/ankle Data sourced from over 500 hospitals. Utilization data based on the Premier research database for the six months ended June 30,

14 Length of Stay, Days Regional Analysis Reiterates Negative Impact of Opioid Related Adverse Events Cost 55% Longer Length of Stay and 47% Higher Costs in Patients With ORAEs Increased Readmission Rates, Inpatient Mortality, and Outlier Status in Patients With ORAEs P< P<0.001 $21,012 $25,000 $20,000 30% 25% P< % $14,291 No ORAE No ORAE ORAE ORAE Length of Stay Cost $15,000 $10,000 $5,000 $0 20% 15% 10% 5% 0% ORAE No ORAE P< % 5.6% 30-Day Readmission Rate P< % 1.1% Inpatient Mortality 10.0% Cost/Length of Stay Outlier Kessler, et al. Pharmacotherapy. 2013;33(4):

15 Multimodal Strategies With EXPAREL Targeted to Reduce the Burden of Opioids Patients at the Highest Risk for Oversedation and Respiratory Depression A complimentary publication of The Joint Commission Safe use of opioids in hospitals Issue 49, August 8, 2012 Opioid analgesics rank among the drugs most frequently associated with adverse drug events A number of safety measures may reduce the risks of opioid-related adverse events Key patients warrant multimodal opioid sparing approaches, including non-opioid pain medications Sleep apnea or sleep disorder Morbid obesity Snoring Older age No recent opioid use Post-surgery, especially after upper abdominal or thoracic surgery Increased opioid dose requirement Longer time receiving general anesthesia during surgery Concomitant use of other sedating drugs Smoker 15

16 HCAHPS - Pain Control Is an Important Metric of Patient Satisfaction With Hospital Performance Pain management is the only clinical marker assessed: The HCAHPS survey contains 32 questions and eight dimensions, including composite topics ranging from communication and cleanliness to staff responsiveness and pain management 1 How often was your pain well controlled? (question 13) 2 How often did the hospital staff do everything they could to help you with your pain? (question 14) 2 HCAHPS scores have a direct impact on reimbursement: Under CMS Hospital VBP program, a hospital s HCAHPS score (Patient Experience of Care Domain) constitutes 30% of the IPPS total performance score determining reimbursement 1 Hospital HCAHPS performance is publically available: Results are reported online quarterly 1 : 1. HCAHPS Fact Sheet. HCAHPS website. Updated August Accessed April 1, HCAHPS Survey. HCAHPS website. Updated March %20Mail%20Survey%20Materials%20(English)%20March% pdf. Accessed April 1,

17 Better Outcomes and Savings Demonstrated in Clinical Practice Bariatric Replaced On-Q John Pilcher, The Methodist Hospital $450 1 Replaced PCA $500 1 Andras Sandor, Lawrence Memorial Hospital Colectomy Reduced Opioids, LOS, Cost Stephen Cohen, Southern Regional Medical Center $ day LOS 2 Reconstruction Decreased LOS Michel Saint-Cyr, Mayo Clinic 1.4-day LOS 3 Spine Replaced PCA & Improved PACU Throughput Dante Implicito, Hackensack Medical Center $ hr PACU 4 TKA Reduced Falls, LOS & Cost John Barrington, Texas Center for Joint Replacement $ Urology Reduced Opioids, OR Time, Cost Adam Hollander, Baylor $ Frost & Sullivan. New Opportunities for Hospitals to Improve Economic Efficiency and Patient Outcomes Cohen S. J Pain Res. 2012: Batdorf N, et al. Podium presentation at American Society of Reconstructive Microsurgery Implicito D. Beckers Spine Review. Dec Barrington J, et al. Podium presentation at AAOS Hollander AB, et al. Journal of Urology. 2014;191(Suppl 4S):e-828-e Domb BJ. Podium presentation at ICJR Houston Anterior Hip

18 Data from IMPROVE Pooled Analysis Demonstrates EXPAREL Health Economic Benefits Opioid Consumption, mg Length of Stay, Days Hospital Costs, Thousands EXPAREL-Based Multimodal Therapy Reduced Opioid Use, Length of Stay, and Cost in Open Colectomy, Lap Colectomy, and Ileostomy Reversal Mean Total Opioid Use mg P<0.05 Median Length of Hospital Stay days P<0.05 Mean Total Hospitalization Cost $12 $10 $8 $6 $4 $2 $ $2,455 $10,726 $8,271 Standard of care (opioid-based regimen); N=105 EXPAREL-based multimodal therapy (opioid-sparing regimen); N=86 Cohen S, et al. Journal of Pain Research. 2014;7:

19 Milligrams Bariatric Surgery Study: Removal of PCA, Reduced Opioid Consumption, and Reduced ORAEs Hallmark Health Systems, Boston, MA Andras Sandor, MD Retrospective review of patients who received EXPAREL (n=45) vs patients who received PCA (n=45) following bariatric surgery Reduced opioid consumption Reduced pruritus as an ORAE Faster return of bowel function 61% P< % 75.5% P<0.001 P< % 2.2% Sandor A. Lane JM, Williams CH, et al. Poster presented at: 2013 Annual Meeting of the American Society for Metabolic & Bariatric Surgery; November, 2013; Atlanta, Georgia. 19

20 Hospital Days Orthopedic Surgery Study: Reduced Pain, LOS, Falls, and Costs in 1,000 Total Joint Procedures Millions, $ Texas Center for Joint Replacement, Plano, TX John Barrington, MD, and Roger Emerson Jr, MD Consecutive total joint arthroplasties (TJA) in patients who received EXPAREL (n=1000) vs previous TJA patients who did not (n=1000) Reduced length of stay Reduced patient falls Reduced overall cost of care P= % P= $12.2 $1.25M per 1000 joints 75.6% 35.0% $ % Barrington J, Emerson R, et al. Poster presented at: 2014 Annual Meeting of the American Academy of Orthopedic Surgeons; March, 2014; New Orleans, Louisiana. 20 Overall cost of care savings per patient $1,246.11

21 Study Shows Significant Reductions in Respiratory Depression, Urinary Retention, and Fall Risks Florida Hospital Celebration Health Jay Redan, MD Patients (n=82) undergoing open ventral hernia repair or laparoscopic colon resection received standard of care (n=37) or EXPAREL in addition to standard of care (n=45) 12.0% Urinary Retention Respiratory Depression High Risk or Low Risk For Falls 25.0% 60.0% 10.0% 8.0% 6.0% 4.0% 10.8% 20.0% 15.0% 10.0% 21.6% 50.0% 40.0% 30.0% 20.0% P< % 37.6% 2.0% 0.0% P< % EXPAREL SOC 5.0% 0.0% P< % EXPAREL SOC 10.0% 0.0% 16.0% 8.4% High Risk Low Risk EXPAREL group Standard of care (SOC) group: intravenous hydromorphone or morphine with or without epidurals and/or IV acetaminophen. Redan, Jay. Presented at: American College of Surgeons Clinical Congress; October, 2014; San Francisco, California. 21

22 Milligrams Patients TKA Study Shows Lower Pain Scores, Lower Morphine Sulfate Equivalence Consumption, and Higher Patient Satisfaction TriHealth Orthopedic & Spine Institute Mark A. Snyder, MD Study of patients (n=70) undergoing total knee arthroplasty who received either EXPAREL versus a multi-drug analgesic cocktail for postsurgical analgesia. Higher satisfaction in pain control (p<0.001) and overall experience (p<0.01). Significantly fewer adverse events (p<0.01) 3.31 Pain Scores P< P<0.01 POD #1 POD # Morphine Equivalency Consumption (MS04) Scores EXPAREL group Multi-drug analgesic cocktail (keterolac, morphine, epinephrine, and ropivacaine) P<0.01 Snyder, Mark. Presented at: 2014 Annual Meeting of the American Association of Hip and Knee Surgeons; November, 2014; Dallas, Texas Pain PACU POD #2 P< Nausea Adverse Events P=0.01 9

23 Clinical Development Opportunities

24 Phase 3 Femoral Nerve Block Study snda Submitted in Q ; Expected PDUFA date of March 5, 2015 Pivotal Phase 3 Study of EXPAREL in Femoral Nerve Block 183 patients randomized to receive EXPAREL or placebo administered as a femoral nerve block for postsurgical analgesia following total knee arthroplasty Reduced cumulative pain scores over 72 hours Reduced total opioid consumption P= P< % 75.6% 50% 65% 35.0% Safety was comparable between the EXPAREL and placebo groups, with similar numbers of patients displaying a normal ability to do a 20-meter walk test and similar physician satisfaction with return of motor function Minkowitz H, et al. Poster presented at: 39 th Annual Meeting of the American Society of Regional Anesthesia and Pain Medicine; April, 2014; Chicago, Illinois. 24

25 Analysis Shows EXPAREL has Similar Safety to Placebo in Peripheral Nerve Blocks University of California San Diego Brian Ilfeld, MD Analysis based on review of six Phase 1-3 clinical trials, in which EXPAREL was administered at doses up to 266 mg as a femoral, intercostal, or ankle block. Serious AEs Nervous System AEs Cardiac AEs 12% 25% 14% 10% 8% 6% 4% 8% 10% 20% 15% 10% 21% 21% 12% 10% 8% 6% 4% 9% 12% 2% 5% 2% 0% EXPAREL Placebo 0% EXPAREL Placebo 0% EXPAREL Placebo Ilfeld, Brian. Presented at: 2014 Annual Meeting of the American Society of Anesthesiologists; October, 2014; New Orleans, Louisiana. 25

26 Bupivacaine Liposome Injectable Suspension for Animal Health Pacira Pharmaceuticals, Inc. and Aratana Therapeutics, Inc. Enter into Global Licensing Agreement for Development and Commercialization of Bupivacaine Liposome Injectable Suspension for Animal Health Indications PARSIPPANY, N.J. & KANSAS CITY, Kan. Dec. 6, 2012 Veterinary opportunity that targets the estimated 33 million annual surgical procedures performed on companion animals in the U.S 26

27 Pacira Product Pipeline Overview* EXPAREL Infiltration Approved/Marketed Nerve Block snda Approved/Marketed Oral Surgery Phase 3 snda Approved/Marketed Chronic Pain Phase 3 snda Approved/Marketed Bupivacaine Liposome Injectable Suspension for Animal Health (Aratana Therapeutics, Inc.) DepoFoam-Based Opportunities Acute care product candidate** Phase 3 NDA Approved/Marketed Acute care product candidate** Phase 3 NDA Approved/ Marketed Acute care product candidate** Phase 3 NDA *The information in this chart represents expected commercialization timelines for expanded indications for EXPAREL, an Aratana bupivacaine liposome injectable suspension product for animal health indications, and DepoFoam-based acute care product candidates. This chart is not drawn to scale. **Pacira is assessing multiple acute care product opportunities. The illustrated timelines above are neither definitive nor precise, but reflect Pacira s present plans to commercialize the first product candidate in 2018, followed by successive commercialization of additional product candidates in the years following. 27

28 Investment Highlights

29 EXPAREL Franchise Protection Long-Term No Long-Acting Bupivacaine Competitor Durect s Posidur Complete Response Purdue Pharma s extended-duration local anesthetic (EDLA) failed Other pharma failed programs No Near Term IP Cliff Issued patents through 2018 Filed patent through 2031 Paragraph IV filings require ability to manufacture No DepoFoam Competitor PCRX is the only company with commercial scale manufacturing of multivesicular liposomes Estimated 7-8 years and $100M investment to experiment into the DepoFoam manufacturing business No AB Rated Generic DepoFoam components are productspecific Difficulty of PK/PD matching 29

30 EXPAREL Batch Manufacturing San Diego, CA, U.S. Configuration Estimated Capacity* Swindon, U.K. Configuration Estimated Capacity* Suite A 1 45L (semi-automated) ~$100M Suite A 2 2 x 45L (Suite C-1 replica) ~$300M Suite C 1 2 x 45L (fully automated) ~$300M Suite B 2 200L ~$600M ~$400M ~$900M Estimated capacity represents vial production converted to net revenue. Suite A-1 is operating at capacity, while Suite C-1 was approved by the FDA on March 28, 2014 and will gradually ramp up to scale. The Patheon partnership was established on April 7,

31 Balance Sheet & Capitalization Cash (millions) Cash and cash equivalents, restricted cash, short-term investments and long-term investments (as of Sep. 30, 2014) $176.1 Debt (millions) Convertible Notes at 3.25% Fixed Interest Rate 1 $120.0 Maturity Date of Convertible Notes Feb Capitalization (millions) Basic Weighted Average Shares of Common Stock (Q3 2014) 35.9 Diluted Weighted Average Shares of Common Stock (Q3 2014) The $120.0 million principal amount of convertible notes must be settled in cash. The convertible notes include a fixed net share settlement feature over the conversion price of $24.82 per share, which may be settled in cash, stock or a combination of cash and stock at the Company s election. 2. Diluted shares of common stock include the potential dilutive effect of stock options, warrants, employee stock purchase plan units and the net share settlement feature on the Notes. The diluted shares assumes that the net share settlement above the $24.82 conversion price will be in stock. However, the Company may settle this feature in stock, cash or a combination of stock and cash at its discretion. 31

32 Financial Results & Outlook 1. Successful EXPAREL Launch and Product Market Opportunity Large market with high peak sales, small market share 2. Gross Margin Opportunity Scalable Manufacturing Infrastructure 3. Operating Margin Opportunity Gross Margin Opportunity plus Compact, Specialty Salesforce 4. EXPAREL Franchise Longevity NCE-like, proprietary DepoFoam technology Select Financial Data ($ in millions, except per share amounts) Q Q Total Revenues $52.0 $47.2 Gross Margin 61% 57% Total Operating Expenses $53.0 $50.0 Cost of Goods Sold $20.4 $20.0 Research and Development $4.4 $5.2 Selling, General and Administrative $28.2 $24.8 GAAP Net Loss $(3.0) $(5.0) Non-GAAP Net Income (Loss) $5.7 $1.5 Non-GAAP Basic Net Income (Loss) per Share $0.16 $0.04 Non-GAAP Diluted Net Income (Loss) per Share $0.14 $

33 Important Safety Information for EXPAREL EXPAREL is contraindicated in obstetrical paracervical block anesthesia EXPAREL has not been studied for use in patients younger than 18 years of age Non-bupivacaine-based local anesthetics, including lidocaine, may cause an immediate release of bupivacaine from EXPAREL if administered together locally. The administration of EXPAREL may follow the administration of lidocaine after a delay of 20 minutes or more. Other formulations of bupivacaine should not be administered within 96 hours following administration of EXPAREL Monitoring of cardiovascular and neurological status, as well as vital signs should be performed during and after injection of EXPAREL as with other local anesthetic products Because amide-type local anesthetics, such as bupivacaine, are metabolized by the liver, EXPAREL should be used cautiously in patients with hepatic disease. Patients with severe hepatic disease, because of their inability to metabolize local anesthetics normally, are at a greater risk of developing toxic plasma concentrations In clinical trials, the most common adverse reactions (incidence 10%) following EXPAREL administration were nausea, constipation, and vomiting 33

34 Pacira 2014 Thank You 34