Aradigm Corporation. A respiratory specialty pharmaceutical company fulfilling unmet needs in pulmonary medicine (ARDM) February 2008

Transcription

1 Aradigm Corporation A respiratory specialty pharmaceutical company fulfilling unmet needs in pulmonary medicine (ARDM) February 2008

2 Safe Harbor Statement This presentation contains forward-looking statements that are based on management s current expectations and beliefs and are subject to a number of risks, uncertainties, and assumptions that could cause actual results to differ materially from those described. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements, including estimates of revenues, operating margins, capital expenditures, cash, other financial metrics, expected legal, arbitration, political, regulatory, or clinical results, and other such estimates and results. Forward-looking statements involve significant risks and uncertainties, including those discussed below and more fully described in the Securities and Exchange Commission (SEC) reports filed by Aradigm, including Aradigm s most recent annual report on Form 10-K and most recent periodic reports on Form 10-Q and Form 8-K. Please refer to Aradigm s most recent Forms 10-K, 10-Q, and 8-K for additional information on the uncertainties and risk factors related to our business. Unless otherwise noted, Aradigm is providing this information as of November 14, 2007 and expressly disclaims any duty to update information contained in this presentation. No forward-looking statement can be guaranteed and actual results may differ materially from those we project. The Company s results may be affected by our ability to successfully develop, partner and market our products domestically and internationally, difficulties or delays in manufacturing our products, and regulatory developments (domestic or foreign) involving current and future products and manufacturing facilities. Discovery or identification of new product candidates cannot be guaranteed and movement from concept to product is uncertain; consequently, there can be no guarantee that any particular product candidate will be successful and become a commercial product. In addition, while we routinely obtain patents for our products and technology, the protection offered by our patents and patent applications may be challenged, invalidated, or circumvented by our competitors. Our business may be impacted by government investigations, litigation, and products liability claims. 2

3 Two-Pronged Business Model Specialty Pharmaceutical Company Proprietary formulations or delivery of proven drugs targeting severe respiratory diseases Dedicated specialty sales force to US respiratory physicians Abbreviated regulatory pathway Royalties & Milestone Payments Lung Rx/United Therapeutics Zogenix Opportunities for continued outlicensing of technology 3

4 Aradigm Core Technologies AERx Liquid formulation applicable to many valuable biologics and drugs Efficient, precise aerosol generation Breath control to ensure reliable drug delivery to lung Liposomal Formulation Nanopackaging of drugs Sustained release within lung Ideal for AERx platform Applicable to multiple products Outstanding reproducibility in humans Extensive Intellectual Property Portfolio and In-House Expertise 4

5 Pipeline of Active Inhalation Product Programs* Stage of Product Candidates Indication Development Partner ARD 3100 (Lipo Cip) Cystic Fibrosis Phase 2 ARD 1500 (Treprostinil) Pulmonary Arterial Preclinical Lung Rx/United Hypertension Therapeutics ARD 1600 (Nicotine) Smoking Cessation Phase 1/2 ARD 1100 (Lipo Cip) Inhalation Anthrax Preclinical Combination Products Asthma, COPD Preclinical CyDex * Does not include Intraject products sold to Zogenix; NDA for the sumatriptam product submitted in December 2007 (milestone plus royalty to Aradigm expected following approval) 5

6 Pipeline Focus 2008 Stage of Product Candidates Indication Development Partner ARD 3100 (Lipo Cip) Cystic Fibrosis Phase 2 ARD 1500 (Treprostinil) Pulmonary Arterial Preclinical* Lung Rx/United Hypertension Therapeutics ARD 1600 (Nicotine) Smoking Cessation Phase 1/2 ARD 1100 (Lipo Cip) Inhalation Anthrax Preclinical Combination Products Asthma, COPD Preclinical CyDex * Bridging study in 2008 to the nebulizer used in the recently successfully completed TRIUMPH Phase 3 study 6

7 ARD 3100 Cystic Fibrosis (CF) Need for a New Antibiotic Treatment Respiratory infections in CF major cause of morbidity and mortality Tobi (Pathogenesis/Chiron/Novartis): only inhaled antibiotic FDA approved for the treatment of lung infections in CF patients Tobi used one month on, one month off; potential for resistance issues, serious side effects emerging 7

8 ARD 3100 Lung Sections: Normal vs CF Bronchiectasis 8

9 ARD 3100 Liposomal Ciprofloxacin Market Potential for Cystic Fibrosis CF affects ~ 30,000 patients in USA, ~ 70,000 worldwide Tobi revenue of $232.6 million in 2005 Historical growth rates in excess of 20% 2004 to 2005 growth rate of 9.3% CF community in USA can be served with a small dedicated specialty pharma sales force Potential for partnering outside USA 9

10 ARD 3100 Advantages of Inhaled Liposomal Ciprofloxacin Choice of drug: Ciprofloxacin Well accepted by physicians Oral and injectable forms used in cystic fibrosis to treat exacerbations caused by infections Choice of delivery method: inhalation Rapid onset of action, improved efficacy and reduced systemic side effects Choice of formulation: Liposomes Slow release liposomal formulation reduces frequency of dosing Additional benefits: Proprietary product with orphan drug designation Multiple indications with same formulation Manufacturing done by contractor experienced with liposomal products: Enzon 10

11 ARD 3100 Inhaled Liposomal Ciprofloxacin: CF Clinical Development Phase 1 (completed) Phase 2a Location Australia Australia/New Zealand Study Design Safety, tolerability, PK, healthy volunteers. Single dose escalation followed by one week dosing (total n=20) Efficacy, Safety and PK in CF patients. Reduction in P. Aeruginosa density after 14- day dosing (total n=24) Execution Completed October 2007 November 2007 March

12 ARD 3100 Phase 1 Summary Findings Liposomal ciprofloxacin inhalation well tolerated at three different dose levels, including the target clinical dose for 1 week No serious adverse event reported Pharmacokinetics profile supports sustained release Blood levels of ciprofloxacin much lower than those reported following usual oral and parenteral doses 12

13 ARD 3100 Inhaled Liposomal Ciprofloxacin: CF Clinical Development Phase 1 (completed) Phase 2a Location Australia Australia/New Zealand Study Design Safety, tolerability, PK, healthy volunteers. Single dose escalation followed by one week dosing (total n=20) Efficacy, Safety and PK in CF patients. Reduction in P. Aeruginosa density after 14- day dosing (total n=24) Execution Completed October 2007 November 2007 March

14 ARD 1500 Inhaled Treprostinil: Partnership with Lung Rx/United Therapeutics Collaboration with leader in the treatment of pulmonary arterial hypertension PAH 2006 market: > $ 1 billion, growing rapidly Bridging strategy from the TRIUMPH Phase 3 nebulizer to AERx Essence Most likely the fastest path for Aradigm to enter the PAH market Treprostinil currently approved in iv and sc infusion (Remodulin) Showing excellent acceptance Inhaled treprostinil could provide a better, more convenient therapy (only one inhaled PAH product Ventavis - approved) AERx Treprostinil delivery in a small number of breaths 2 3 times/day, compared to Ventavis (nebulizer 6 9 times/day, > 10 minutes per dose) Liposomal formulation could add further benefits 14

15 ARD 1500 Inhaled Treprostinil: Partnership with Lung Rx/United Therapeutics Aradigm receives $880 K and conducts initial clinical trial in 2008 Upon successful completion of the first trial United invests $3.47M in Aradigm s common stock Aradigm receives milestones of up to $9.65 M within 3 years of signing the agreement Lung Rx is responsible for conduct and funding of all the remaining development, manufacturing and commercialization Aradigm will receive royalties up to 10% of net sales of AERx Treprostinil 15

16 ARD 1600 AERx Essence Nicotine Tobacco Smoking Cessation a Major Global Unmet Medical Need Craving for nicotine difficult to overcome using current therapies High failure rates of existing approaches Deep lung deposition results in unique rapid absorption of nicotine leading to very high plasma levels of nicotine thought to be related to craving Aradigm s product profile Faster and higher C max than available from gum, patch, or inhalable nicotine products. Gradual reduction of nicotine plasma peaks, starting from levels similar to those resulting from cigarette smoking, to wean off smokers Handy inhalation device with minimum requirements for maintenance Simple formulation of pure nicotine salt in water to avoid use of potentially toxic excipients 16

17 ARD 1600 AERx Essence Inhaled Nicotine Phase 1 trial completed 18 adult smokers Open-label Pharmacokinetics Subjective acute cigarette craving scores Water solution of nicotine delivered in single breath using the AERx Essence Nicotine palm-size inhaler Three nicotine doses (0.2mg, 0.4mg and 0.7mg) Safety endpoints No serious adverse reactions 17

18 ARD 1600 Comparison of AERx Essence Nicotine to Other Nicotine Products 25 Nicotine Profiles Arterial blood for AERx, venous for others Plasma Nicotine Concentration (ng/ml) Cigarette (1 mg) Patch (21 mg) Gum (4 mg) Nasal Spray (1 mg) Nicotrol Inhaler (4 mg) AERx (0.25 mg) AERx (0.5 mg) AERx (0.75 mg) Time (minutes) Adapted from Rigotta NA NEJM Vol 346, No. 7, Feb

19 ARD 1600 Effect on Craving Protocol ARD Essence Nicotine Delivery System Mean Cigarette Craving Rating vs. Time All Dose Levels, Mean FTND = 4.7, (n=16) 7 Cigarette Craving Score Time 19

20 Untapped Potential for AERx Technology? Growing Use of Fixed Combinations of Inhaled Drugs Sales ($billions) % CAGR Others Antileukotrienes ICSs 10 SABAs 8 SAMAs 6 LAMAs 4 Biologicals LABAs 2 SABA/SAMA combinations ICS/LABA combinations * Commercial Insight: Asthma/COPD, DataMonitor, July

21 AERx Combination Asthma Products Develop approved drugs and approved combinations in proprietary formulations and delivery system AERx Essence delivery of aqueous solutions of bronchodilators and anticholinergics mixed with cyclodextrin-solubilized corticosteroids a unique approach to enter the inhaled combination product market Collaboration agreement with Cydex Inc. company with many years of success in formulation of solutions of poorly soluble drugs Initial investment, revenues from third party licensing and sales split 60:40 between Aradigm and Cydex 21

22 Inhaled Insulin and the Novo Nordisk Relationship Novo Nordisk discontinued on January 14, 2008 development of inhaled fast acting regular insulin using AERx idms Nine Phase 3 clinical trials were underway Approval was expected in 2010 with 2nd generation small AERx Insulin device Novo Nordisk sent Aradigm 120 day termination notice Novo Nordisk plans to develop inhaled long acting insulin analogue and GLP1 analogue Novo Nordisk and Aradigm are engaged in discussions about the future of our relationship 22

23 Financial Highlights (September 30, 2007) Cash and short-term investments: ~ $ 47 million Cash burn < $2 million per month annual burn expected to be $24 million or less Equity: all common stock, 54 million shares 23

24 Key pipeline developments expected in 2008, including: Results expected from Phase 2a CF study with liposomal ciprofloxacin (ARD 3100) Bridging study with AERx Essence Treprostinil (ARD 1500) with Lung Rx Advancements expected in New indications for liposomal ciprofloxacin Asthma/ COPD combination therapy products Smoking cessation with AERx Nicotine 24

25 Summary of the Opportunity Plan in place to become an industry leader to improve the quality of life of patients with severe respiratory disease Future royalty streams possible Intraject Sumatriptan launch expected post-february 2009 patent expiry Lung Rx/United AERx Treprostinil rapid bridging strategy Potential for further valuable partnerships Use of AERx for treatment of diabetes and obesity Out-license Lipo Cip for ex-us markets AERx Essence Nicotine - Smoking cessation Asthma/COPD products Out-licensing or sale of other non-strategic assets Strong cash position for current R&D program progress 25