PRTK - Earnings call transcript Q1 2019 | Paratek Pharmaceuticals, Inc.

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Operator

Ladies and gentlemen greetings and welcome the Paratek Pharmaceuticals' First Quarter 2019 Earnings Call. At this time, all participants are in a listen-only mode. A question-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this program is being recorded. It is now my pleasure to introduce your host Ben Strain. you. Thank

begin. may You

Ben Strain

welcome conference first call. and and XXXX corporate update to afternoon quarter Paratek's earnings Good

posted website call Medical Participants Chief Officer; CEO and Loh, Our quarter on earlier also Michael President and results release this Officer. was in Woodrow, press Chairman with be found at issued are today the Adam call. Both and referred will be that company's Commercial www.paratekpharma.com. can of first slides to Officer, Chief Chief our and Operating on today's Bigham, the Board; we've Evan

Michael, Before to that I filings and our turn in certain consult I statements our the you additional would may making These results discussed our be SEC actual Michael? and like call which out to materially. over statements point expectations and based I subject encourage on to the current risks to uncertainties forward-looking for differ factors are also risk we'll beliefs. are detail.

Michael Bigham

Good daily spectrum States. of with early NUZYRA and the of first you to treat in oral corporate approval antibiotic update. skin FDA Ben. broad once and the integrated and of marked XXXX you, is thank and with start organization into call intravenous joining in transformation a infections. launch commercial nearly the years United February NUZYRA XX the all pneumonia both our quarter development fully earnings The afternoon Thank Paratek first XXXX to for

NUZYRA adoption modern community accelerate. patience hospital new for no the of tells are antibiotic sustained and a the daily daily to after ore setting there While for education, it the which like once setting analogs, momentum can history us takes establish effort, in

the and indicators several to by believe for ahead. months early usage growth encouraged stage we and begun that years the are We leading have in set

Paratek offers, the to eight working a generated the patients NUZYRA establishing weeks U.S. ensure on benefits potential have to long-term for focused NUZYRA building our $X.X necessary while with build that launch formulation. awareness life-saving simultaneously channel NUZYRA XX% diligently We for therapy. educating and been oral quarter distribution market, supply inventory with first which robust along million in commercial benchmarks, clinical first have these efforts stakeholders this pharmacies potential key net revenues specialty the achieved and believe in revenue actively approximately a success. we chain related and early foundation are Our estimate on that of were In several to with the to strong having the create of the

included earned in We also significant first recorded which royalties perspective. successes million sales the from U.S. a SEYSARA in royalty the progress Other revenue $X.X of include from reimbursement quarter

fact target one-third the since increased commercial effort approximately U.S. XX% to has end NUZYRA in and first a within launch, the our had prescribers by quarter. of across lives to aided of our the that awareness In Market access coordinated result XX% from and medical suggests organizations. research of extensive commercial

greater like review use the being over future the is of indicators established. performance NUZYRA, we XX% carefully growth interested detail. and by we Additionally, care XXX-plus them for stage institutional aware NUZYRA. call these believe among And would future I Adam to are for are institutions. bode of early providers these or have to Adam? targeted achievements. We achieved in are The approximately and access of now over in well leading have health methodically XX% turn who prescribing encouraged over commercial to in the

Adam Woodrow

Thanks Michael.

early significant in As the in United we a for previously February achievement Paratek. NUZYRA mentioned, States launched

with medical pathogens NUZYRA has genetic needs address and both the all first treatment XX resistant skin causing addressing antibiotics. CAP, As important oral empiric believe daily the IV the nearly also to whilst failures broad unmet antibiotic and we in years, for spectrum once older antibiotic in opportunity which that are

Continuity ensure XX% in In of ensures approach weeks addition we adequately related do build to on were the alternative $X.X eight in being We positive available field for physicians the us. in IV and in a second revenues this formulation specialty launch. of majority patients NUZYRA where its who certain believe initial channel Quinolones. specialty have We supplied antibiotics inventory was the in market. provides first has build vital an first and the to force minimization the United important anticipate example successful that net help and oral quarter. first further daily approximately of expansion a stays with tolerability States million and NUZYRA continue product. an of those profile this within needed and a is purchased is regions the once the experience will to estimate material our believe this have much NUZYRA focus with quarter inventory to we hospital NUZYRA care remain of to This The distribution which regiments pharmacies vast generated hospitals to oral the revenues safety our a we in enables NUZYRA pharmacy the for not activity.

second last NUZYRA mentioned starts expansion year. in the we the with success hospital the market into the community specialists quarter beyond for As with the

hospitals. outreach pulmonologists, specialists within has directed and U.S. doctors, adopting including identified physicians IV XXX-plus an key hospitalists initial been Our ER early toward

channels, focused prescribers our of through decision a targeting number these on message are We hospitals. U.S. prioritized makers delivering and within

end of expand we sales and As hospitals the plan to our also previously, by team disclosed the target we of XXXX. number

incorporate will from level to learnings and early expansion. cadence the the additional We gauge launch the of

starting we've access antibiotics, often committees setting stewardship targeted budget and shared also which have the concerns. That integrated mandates us for have to past, that actually safety networks, access built-up in that we delivery the for on making focused setting further holds have are antibiotics. gaining have include said, challenging key all and frequently which to past progress tells steady use and several committees, the been years. formulary develop reduced efficacy a generic These hospitals As formulary over committees, the and myriad constraints will history NUZYRA, institutional In access by Institutional new we and trial is to hospital in is our of slowed with you NUZYRA. adoption. in as constraints navigating drug raising lead are we believe to access utilization recent the awareness favor hospital

Michael institutional of access in opportunity. a Now we've targeted as with XXX mentioned, approximate achieved over hospitals. provides great the us This XX%

process, shortcuts no we through one's are this the we there While foundation. believe multilayered right working laying are to way

the over hospital progress setting our to life for the stays. of call vital we're opportunity. efforts once on begun. oral short that serve just in progress and the have eight recognize a a turn we're forward to path of our long-term the We as in that, daily us the to a We efforts Our ahead. NUZYRA, right experiences in a hospital on that with time look community quarters commercial Whilst in by energized to like only demand We in taught with I'd drug, the potential stage now and much well-positioned success. for minimize over reporting will we into are believe time believe Evan. And and the broader rewarded NUZYRA IV spectrum that antibiotic weeks has the growing steady with springboard be will broad the

Evan Loh

reach market broadening pursue Thanks, number a while Adam. new the to opportunities and continue of NUZYRA NUZYRA's successfully microbiological continuing NUZYRA to of of U.S. launch utility. for important compelling present potential understanding the into to The NUZYRA we of to new segments, lifecycle data clinical underway, further clinical

award, testament access worked and that to Chemical innovation value life both highlight Chemistry products be Society's approval the of I these This I clinical and was acknowledge honor these the today. American the the to with and tirelessly to effective sets the and of chemists passion and therapies. SEYSARA a that recognizing scientific to two agents. clinicians new provide like announced who XXXX and expertise and of potential Heroes patients drivers, skill a awarded clinical team thank have enabling cycle development well-tolerated available of teams for of this is great we would month, teams commitment today NUZYRA novel the and Before the Last these development

mass profile to of safety overweight not NUZYRA. dosing evidence and continued of body regardless of dose -- A NUZYRA As compared of key presentations. XXth that at dosing obese, efficacy subgroup provide highlight you impact NUZYRA's analysis that ECCMID, clinical body data of Linezolid. no commitment Infectious growing Diseases NUZYRA the that again no and or infection of NUZYRA to suggest fixed against all use not are safety to complex to the to with adding where needed, end patient skin simplicity fixed reassurance the based showed adjustments mass, to demonstrating utility know or data does clinician Congress and comorbidities. nine difference These data of needed strategy The a infections. our the included the efficacy safety presentations highlight body and life-threatening and a microbiology has being the in These and Microbiology in a continued ease shared upon in weight adjustments patients deliver Paratek Clinical in European we healthy transparency. dose of efficacy NUZYRA with To profile scientific

infections infections. alone. infections skin progress urinary of the to of indications, important U.S. the safety approximately with XX most efficacy Beyond we and diagnosed of approved year bacterial one the continue and tract written make core scripts evaluation in CAP Omadacycline the to in treat per commonly the tract are million Urinary

high a the safety is in resistant activity the treat the rationale omadacycline in physicians have a with for upon of to due key known drug quinolones Given spectrum pathogens. antibiotics. to UTI based today vitro lack the limited oral its tract extensive combined the There urine and concerns potential well-tolerated human options present of of broad against associated treating rates infections with urinary rising use seen compelling levels

evaluate study omadacycline to tract X Our Phase is designed in infections. urinary first uncomplicated only oral

an best additional to common oral underserved top to study is with intravenous look of determine year. in with the position to and second from can studies and conversations half have be reached ahead we FDA that in of acute accelerated are cash is current potential These in further tract will path that for this a complicated urinary providing that We of we CAP. now also with progress for our half Our FDA continues both We with an agreement these Outside of marketing infections. data omadacycline Once projection. U.S., indications. XXX provide to second remains of the under indication an We've These Phase that authorization months or studies our the treatment discussions a runway time. evaluate anticipate efficacy the have within designed the our opinion omadacycline need safety forward we pyelonephritis, forward in the responses. potential MAA how included the designed data provide XXXX. had the the regarding subset to application line a review achieved CHMP submitted indication in X and EU achieving to oral-only details respect oral-only omadacycline at day second the

a pneumonia both infections. now reminder, for and turn call I are back seeking that, over will Michael. approval skin the As Michael? we With to

Michael Bigham

Thank Evan. you,

the I I review financials the will Before for relevant conclude, first quarter.

XXXX, reported million the support year in $XXX.X year. of the driven $XX.X the SG&A XXXX. sales for for with which The the quarter of additional to period capitalization compared marketable to to primarily which of U.S. Based product quarter May upon first of was $XX.X related NUZYRA million net increase costs, revenue equivalents SEYSARA securities was same the debt, the notes. attribute the period million, the in sales classified SEYSARA and quarter cash, million marketable the product of and NUZYRA were Revenue the and U.S. of loan XXXX XXXX. NUZYRA cash approval operating of estimated $XX.X royalty $XXX.X for net during in million net of NUZYRA period XXXX the until were in was We ended we same compared of as was we March for the on anticipate appropriately to earned with a in $X.X securities and contract expense of current For $XXX million cash primarily for convertible and XXXX. XXXX NUZYRA. funded $XXX.X commercialization of which XX, million to in was R&D includes of from million supply XXXX commercial decrease royalties last $XX.X same equivalents expenses compared in first as first quarter organization loss by our loss million which cash, million $X.X R&D costs sales million XXXX. the revenue $XX.X included the of royalty-backed a FDA Paratek's earned of an the plan, of million first $XX.X X existing This expenses

and expenditures which All continuing focus debt to of fund of on and launch providing which on access includes and encouraged our beyond that company NUZYRA in closing, quarter to through expenses, we have and with capital positive calls. to-date NUZYRA. In service ensuring the build will broader operating earnings establish activities experience updates of the patients We're U.S., further quarterly progress awareness regular our by our the remains forward successful a XXXX. commercial look first physicians

accelerated anticipated end compelling oral-only We UTI in opportunities treatment expand of the of cycle several And with opportunity life EU year the open questions. even with department the indication universe in broader will our by NUZYRA: to that, the floor for and have the offering of an we for work potential drivers the Defense with ongoing for approval patients significantly by have market pneumonia. These omadacycline in to potential need. to the the value

Operator

[Operator Dewey Canaccord you. Steadman Your from comes from of line first Genuity. Thank the Instructions] question

You now live. are

Dewey Steadman

I of with BARDA? work you. that this the what mentioned the really differences in does timing that that are have Thank guess how should opportunity we expense your out? discuss prepared -- how you should remarks, approach purchase and And BioShield didn't in guys and And the contrast it two from those programs? biodefense on opportunity? be would what in And program the DoD the past in a

Evan Loh

Thank Evan. question. the you its for Dewey, It's

bioterrorism into discussed as we've anthrax ongoing the through DoD small looking program we past second that achieving his pharmacokinetics at specifically years specifically we're for and plague. animal an we the as is efficacy. mentioned Michael also have to research ran a and and now looking and that's at prophylaxis program ultimately prepared in understanding -- with ago organisms the that around in that the the consistent with As the specifically remarks, And several a aimed Animal of species, such and approvals animals expand Rule demands

moving standalone you program by And fulfill spring the So intravenous the BioShield that of that anthrax indication there is several proposal of in at plague, came that's just and that BARDA for is pursue -- an we particular afternoon this part look -- preprogram the actual on is having proposals as activity as there a was well actually a this own. announcement request the will program against question request an organisms its this mentioned that's a looking that we to standalone out but whether Project that forward that afternoon. criteria could believe announced plan for the bioterrorism well-positioned application include we an early was of oral formulation. separate and including it. and we omadacycline When pneumonic having a at as specifically

Operator

Thank you.

Our from next BTIS. Hazlett Robert line question of comes from the

now are You live.

Robert Hazlett

guys. the Congratulations Thanks. on progress It's BTIG. Thanks.

follow-up just program? to with of year-end? is question force. could more the expect some sales the you second details a expansion there like timing particular Is BioShield It to in but seems interested released a Adam, that be with on as I'd any the regard regard you you. with to around regard any by timing initially RFP the give Just that? little with expansion to the question. Thank of And color the so, last

Evan Loh

to Evan. hour can came its I'll take about Thank and first the application that have The XXst, the -- I be Adam out about to applications From the when deadline for the six government within current have also take announcement at ago. is a We fiscal question cycle. would Bert, question. which that So that. go in. it's second look an you the funding then the believe week just June our reading to

end award And so probably the would to have the by September, by October be received Xst. of so

Adam Woodrow

already you see to We, plans. that see Bert, the that can said obviously, to of information look growth Look, goes. on going the and by call. actually we'll probably our expand more traction make XXXX. at looking at want I early We'll the sales next traction But we're a always And to Adam. cadence we where tell Hi, we've the give call. in for it’s the and expansion we're the force plan how drug we before at phases the

Robert Hazlett

you. Thank Okay.

Operator

you. Thank

line Ed next comes of the Arce from Our question H.C. with Wainwright.

are You live. now

Thomas Yip

Hello, This of everyone. is for you. several questions. taking Thank Thomas I couple have the questions Yip. for you

Can to NUZYRA due you buildup. us mentioned inventory in first, revenue XX% So represents? idea of give an inventory amount weeks is you how that that many of XQ

Michael Bigham

made it's inventory product, try to where we distribution is we've is we're actually representatives as do of and that up retail the What sure the make and oral build in way to units of trying is what outlets that got Well, work. predominately basically sort product pharmacies. specialty really retail most gone means to that our

So, a it's local available on prescription make is. that prescription a there's where just you come It's product give to geography. that can't should in sure not really -- actually it weekly depends just I because from

Thomas Yip

Okay, got at of the of increased metric captured? to awareness another are it. And you Thanks and data looking then awareness, that aided which how for us we it's is from details XX%. clarifying. remind Can XX%

Adam Woodrow

Yeah.

the really you so where we've -- understand, way only basically the present that look done So we're we just way we at working. our

the you a and institutions that any in So don't then a that the numbers We're then ones with acquired that was know. tick unaided. and ask six skin ask you that's give community And because the familiar are And and list obviously and The pneumonia After you list in question, they you indications the you'll That's specifically difference of of pleased the they'll it's they between won't the on. aware know, what list they'll actually weeks is they'll of we're high after. names they following And that of you that we've ask which way you space launch The they essence in are antibiotics? are got targeted here. you really works the tick. launch. antibiotic It's aided we're specialties at the and give know antibiotics really it calling seen. unaided. individuals, with awareness the since XX% we've after give ones

has So the a we're of And work with seeing large on recognition it's launch. post we're that pre-and the really encouraged very what gone here.

Operator

you. Thank

of of Bank line comes question America. Gerberry from next the from Our Jason

You are now live.

Jason Gerberry

good Hi, -- are kind just questions. think not as contributor? the the meaningful a you in would they XXX do for disproportionately approximation the just anticipate you you I -- us the NUZYRA, give taking for my revenue can the this run you the can kind evening. of terms about second How first terms then Thanks additional the a guess add quarter, is you remind you can until my ultimate of opportunity And the specific spend of SG&A that the XXX Thanks. sense apportion second just institutions versus of question good XX rate XXX? in reps? you the in institutions us second quantify just

Adam Woodrow

have to we adoption for the got your So the difference is answer smoother question. and terms sites will some The additional than we've others. greatest a the of the proportion that the XXX bit can the in magnitude is little in orders actually, and believe of the run opportunity in that's earlier second no question of The processes only is, size the first potential. different where actually gone hospitals that

bit a still that in branded places were history but of the bringing used slower to are identify ones a have branded that still to the were quicker antibiotics, try adopt. than little -- antibiotics we So

same the have is right your of adopt. a to have to both we little potential. they slower approached question, XXX So bit now that are difference answer the The not sort

Michael Bigham

to question the SG&A. with And respect

modestly know mentioned, SG&A concert of XXXX. in as $XX and expense million that activity. As as we through effort will and you with you've the built the anticipate was that increased about XXXX for seen We commercial quarter first number

I basically overall. is reasonable a proxy think it So

Jason Gerberry

you. Thank right. All

Operator

Thank you.

comes question SVB the Leerink. next Fadia Our of Ami from from line

live. now are You

Ami Fadia

Thanks evening. for good you. a question. question Hi, the maybe Adam for

then specialty the expansion do in So us not of were with do as anticipate sort to yes of you're Can type regards coverage go stocking at further just you also sales you follow-up. what And And you have ahead. have regions you mentioned stocking -- that any the the then the pharmacies. help the majority and inventory, the with I'll a targeting? of key

Adam Woodrow

Just to answer that question.

inventory aligned of you build sort And the in to. of retail about tell we're much target most are or is very our you that alluded hospitals. with outlets I sort now right outlets these so of So XXX XXX in could over which

the is specifically patient actually see we is identify the Although obviously to on us their difficult institutions. it hospital go or for very within there and putting whether putting it's It's hospital, some something the something stocking hospital some into a whether -- a shelf. for whether when into pharmacy just

have So the of for guidance. you giving now this we taken approach

Ami Fadia

to And from? on a utilization drug you could in treated remaining from the is XX%, then and where if an patients And in gives early whether us you've being coming is that some seen the hospital of that oral? just of feedback sort transition

Adam Woodrow

the perspective, So can is remaining obviously weeks first What XX% a our present because estimate demand really is tell we're of estimate of IV utilization. of and seen of that the what of is encouraged and we've best and utilization we've hospital seen sort in which in eight we've you for hospital this at setting What in seen the care. from I the outpatient time in is with launch every NUZYRA and the for means the use setting setting. of the oral outpatient that the some it in seen cases really in use use we've

for So encouraging obviously an start us. this is

Ami Fadia

you. Thank

Operator

next question Instructions] Thank from you. comes Thalmann. the Ladenburg of [Operator [indiscernible] line Our from

live. are You now

Unidentified Analyst

Thanks few Hi. call. taking my A for questions.

could and the on come which you both would time. results to or expect some third it’s whether from trials if wondering one or quarter when quarter was at both I trials. give UTI that on one First same first detail fourth

Michael Bigham

said at UTI setting and and they IV setting. oral the as look I are complicated and you both different then only indications when uncomplicated the the trials looking oral two think design we in the of those at of

said our year. current same have the are we data these before this the we end about that projections Our remarks as prepared Yeah, of will in time.

Unidentified Analyst

also About And wondering was Thank that you little the looking get if approval more for the of CAPs. mentioned oral you. I to you're to those same expedited -- an a the could you only be to and that for when time? And what test detail you I not trial? on an plans this additional And right announce have on FDA would expect would would when you assume that. an include Okay. decision am

Michael Bigham

for of efficacy for data. Just safety indication trial sake expansion, order generate clinical clarity's you would and type in always need some to

to additional the And a have trial toward That coming we'll impact in discussing that currently a are I active sized needed clarity said, efficacy and and We FDA requirements get pharmacokinetics will discussions that be for safety in without are be further the path forward. supplementing oral to with being with our the months. an material modest believe us current that way look think, we would only it runway. on

Unidentified Analyst

Yeah. Okay. Thank you.

Michael Bigham

Yeah.

path make want other update is the would the community is that this support I other have a to planned think and -- that the expedited point for potential there clarifying launch. here time potential label -- our in to think to I we

Unidentified Analyst

you I required might of might partner Last your milestone approval when NUZYRA kind Okay. in be payments be if happen, when was and on have an wondering receiving there. what you from Thank question China. update might you. that

Michael Bigham

Yeah.

you clarity we with China milestones. and further report will discussions the I FDA still they on those to of have process out we think that the when are having those in

Unidentified Analyst

you Thank much. very right. All

Michael Bigham

Thank you.

Operator

further Thank queue this back and to would questions you. turn like for to we Ladies time. gentlemen, at over I floor no management the have in closing.

Michael Bigham

you. Thank

with As attention we for call time and all Thank comment. brief today's there you are conclude will questions, no closing more our today. your

Goodbye remain in Paratek well profile once continued Your daily, We now. forward of and NUZYRA NUZYRA is This specifically our of your would well-tolerated long-term positioned NUZYRA oral journey very and important our and and of we commercial apprised making to you us begun a unique you the support. without interest has continued journey the commercial for to for success. not possible be progress. appreciate keeping much look success

Operator

conclude and teleconference our today. ladies Thank you, gentlemen. does This for

your now this Thank a may time. day. line disconnect have You and participation your you at for wonderful

Paratek Pharmaceuticals (PRTK) 8 May 192019 Q1 Earnings call transcript