VNDA - Earnings call transcript Q2 2019 | Vanda Pharmaceuticals Inc.

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Operator

Good day, ladies and gentlemen, and welcome to Vanda Pharmaceuticals’ Second Quarter 2019 Earnings Conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder, this conference call is being recorded.

I’d now like to introduce one of your hosts for today’s conference, Jim Kelly, Executive Vice President and Chief Financial Officer.

begin. may You

James Kelly

you, joining Thank XXXX afternoon thank and All to Tiffany. discuss for us quarter Vanda you right. Good Pharmaceuticals’ performance. second

and SEC’s quarter released our second results are afternoon available Our website, www.vandapharma.com. on system EDGAR XXXX the and on this were

our are on addition, conference we versions this live providing In archived and of call website.

on and CEO. today’s is Mihael Dr. call me Joining Polymeropoulos, President our

opening activities. the will I remarks, to Following Mihael update financial you results, our our my before then will questions. ongoing line comment your on introductory on

Before I statements within laws. proceed, be this would we Securities everyone like statements that that call to various the forward-looking on Federal remind meaning of we make will

Our in forward-looking involve upon and that expectations risks, circumstances, statements changes are uncertainties. based current assumptions

Form and available sections other Condition Results the all XX, XXXX, These read risks the are our on described of fiscal in We XX, encourage reports quarter the investors Form of report SEC’s for Discussion on website. year of and filings. March Analysis and our XX-K Operations and the Risk system on and report these ended XX-Q our quarterly Management’s annual on Factors are SEC to December which for ended XXXX, Financial EDGAR and

call as this otherwise, on account information or we this only law. to today as of of we events is The provide new by future except undertake or publicly on call may any on we make provided revise and information, update obligation no required forward-looking statements

like CEO, Dr. Mihael With to the our I to Polymeropoulos. that turn said, would call now over

Mihael Polymeropoulos

for joining Good afternoon, everyone, Thank thank you very and Jim. very much you us. much,

the growth, time, new from HETLIOZ. our especially we record, today showed Vanda’s while products commercialized As revenue revenue reached we for significant a same at reported

continue and growth. the force especially the is performance department, and to value sustainable our of second products demonstrates of Our work commercial our who also to commitment opportunities market our the of position great our hard increase and performance to patients driving of sales enhancing with long-term pursue a awareness our This doctors. both objective ongoing strength the in the in quarter testament to their

in the neurokinin-X We progress discuss advanced with indications. On of also successful made Phase study. atopic end the II development, tradipitant XXXX. III and clinical We and report just our of had in and results study of enrollment III antagonist to will Phase continues development few FDA On a a clinical meeting dermatitis, initiated for all first highlights. the a are on I Phase on half EPIONE track we receptor gastroparesis, three significant the is assets the

On motion significant study in a sickness, large tradipitant, reported we so Sifnos both results and Phase the the in prevention were of Motion effects conducted recently therapeutic vomiting from study II FDA meet the and later XXXX. this plan earlier path] Pacific towards clinical We filing of Ocean. in to with a the [chartered motion program sickness in NDA [ph] an year for

date for Preclude reported HETLIOZ, we did potential PDUFA successful we to what will and [ph] hear] XX, deficiencies remains on letter. not a Discussion the NDA The specific state a update the XX, resolution. the form This with August On expeditiously issued FDA review deficiencies. any towards FDA the lag. work jet and the supplemental On are of Deficiencies FDA July [away letter an

acting and to iloperidone as iloperidone, disorder patients. HETLIOZ the including continue the long in injectable rest for for formulation preparations The The for conduct the oral a study upcoming filing of pipeline of with of advance projects planned. development the regulatory in Syndrome treatment of the bipolar Smith-Magenis

advancement In Jim? our of very summary, significant well a as as pipeline. excited performance progress we’re with commercial our the clinical on

James Kelly

Thank Mihael. you, right. All

million, compared a second and XX% first $XX.X of during net the product to XXXX. increase quarter year-over-year and were quarter or sequential XXXX, increase the million growth. revenue highlighted was As Mihael sales a XX% second of $XX.X we of $XX.X to exceptional, in for quarter XXXX, in quarter $XX.X Total second million the of compared saw million XXXX the

million XX% in the the for increase increase second second of were HETLIOZ $XX net a of XXXX. million a compared $XX to XXXX, million quarter compared product first and of XXXX, to quarter in sales the $XX.X XX% quarter

HETLIOZ to continues patients The on quarter-over-quarter. therapy grow number

highest to the in the patient guidance largest quarter quarter starts fact XXXX since the of both of second sequential and performance. quarter of XXXX quarters growth again in HETLIOZ early patients XXXX. to revisit In third launch, dispensed We as plan second on year new full since in the patients HETLIOZ in were result a therapy was our launch the units context

inventory of June when compared demand. $X.X to change of the weeks XX, held less hand was two pharmacies trailing at based end calculated second XXXX inventory of than channel million. on XXXX, the approximately of quarter quarter As value higher this the Specialty the XXXX. inventory was as of The pharmacy of on specialty first

XXXX, of XXXX in $XX.X second second sales reflect quarter the increase product the of million net a to of XX% a first quarter of XXXX. to million compared compared in when and million increase, quarter XX% Fanapt for the $XX.X $XX.X

to guidance. value June our of full XX, Prescription was approximately trends compared Xponent IQVIA prescriptions first of of Fanapt the as this consistent of the on As hand by quarter XXXX. first financial wholesalers compared XXXX. XXXX, when inventory $XXX,XXX. inventory increased have quarter X% year XXXX remain to increased reported The change with

operating asset result on goods million $XX.X cost of activities. in The operating expenses, amortization, to of second non-GAAP of a non-GAAP quarter Vanda of was compared XXXX, the sold, and Vanda year-over-year, million recorded of second increased expenses $XX.X XXXX. primarily million recorded XXXX, stock-based non-GAAP corporate non-GAAP quarter On income to income of basis million compared XXXX. non-GAAP a On second second the $X.X non-GAAP the $XX for and million and excluding of net the of net comp for of a intangible the basis spend increase quarter legal $X.X in quarter

continue motion sickness. continue primarily we R&D as to studies the of driven by and operating gastroparesis new III to through note Phase rise non-GAAP particular tradipitant for activities XXXX are expect We expenses

a progress strong our position drive commercial the innovative continue development with fund of in and a future our to seek to growth. We we capital programs as business XXXX

cash, cash, XX, to the cash as securities of cash referred million to Vanda’s XXXX. and quarter during were as of of to XXXX XX, June equivalents million as March $XXX.X XXXX an second marketable million, increase compared of $XX.X $XXX.X representing

guidance, between Vanda of achieve cash and than HETLIOZ million; $XXX and sales the product guidance million; expected net prior of reiterates million. Net sales compares an $XXX product XXXX. sales to between $XXX than it XXXX million. to from be update net greater objectives $XX sales expects Year-end million and million of is greater financial both and This XXXX to year net product to XXXX $XXX HETLIOZ and million. in cash its provides end Fanapt $XX between prior product $XXX Fanapt of following $XXX

With back that, to I’ll the turn call Mihael.

Mihael Polymeropoulos

Thank you you questions very to much, have. any may happy answer Jim,

Operator

[Operator Instructions] Jason Butler JMP proceed. question And from Please with Partners. first comes our

Roy Buchanan

had for on questions, questions. missed, Hi, I Thanks great. couple Mihael. I taking sorry, Roy I’m maybe the a This for pipeline of is Jason.

bipolar an II study meeting looking Thanks. I Just update versus mania? Phase guess, on the SMS of proportion end for to are and for patients can patients kind the with the enroll, of of for provide Fanapt. What depression you

Mihael Polymeropoulos

Yeah. Sure.

inputs in program significant based is but discussed world Syndrom, FDA. in the end mixed. on did Smith-Magenis largest receive for on patients crossover in protocol by entire pediatric not adult we past indication, the we’ve a the Phase II the We have As one meeting on did the an study and of that the

FDA in this the questions submit So bipolar and be the plan at will the and your actually a with we the now designing pre-NDA a of meeting in phases thereafter. NDA better disorder, final study answer the short have design. is the completed to ones we’re fashion, On

Roy Buchanan

path Great. update ask Thank tox tox resolve FDA dispute could an study the tradipitant? nine-month And with the on I for the animal the Thanks. to – you. maybe for on

Mihael Polymeropoulos

Sure.

in finalization. know schedule agreed the you And along well, predetermined moving FDA. it the this is is is The As litigation challenged court. to close and very upon with issue

the documents that. in course September will in the by the and XX, all the court of that So decide be and necessary court review will front after

Roy Buchanan

Great. Thank you.

Operator

Jefferies. next from with our And proceed. question comes you. Chris Howerton Thank Please

Chris Howerton

and Thanks strong certainly. congratulations and on the questions, the Fanapt quarter for for HETLIOZ taking Great.

for, side quick guess, revenue what a we that contribution growth the question year-over-year on the that be maybe of during just So saw if relative the of would any for I time? increases you, is Jim, price period

James Kelly

for Chris, the Hi, and thanks question.

what And is you’re – XX% realized you’re same to so that know, somewhere had X% time since year-over-year that X%, looking a price year-over-year, increase, this therefore, that in of unit year. time QX XX% we’ve on price the X, at last range. increase folks year only we X% XX% when As seeing And is January the we to taken growth.

Chris Howerton

Excellent.

Okay.

regarding on follow-up partial clinical resolution here. previous a the of potential for the the a courts from we’re question lawsuit FDA the the the maybe away about month from So a decision hold, with

was could gastroparesis if dermatitis favor positive might seems communicate so but So to a you it if respond how the from for and different your there chronic help the atopic the you strategy obviously in us understand the indications might just be maybe outcome outcomes, what with was you of or move a how in and forward, a that you court terms decision how there negative investors? would clear pretty might delay and

Mihael Polymeropoulos

pursuit many to the and necessary NDA litigation, two, fair understand the discuss cannot in comments the we data on for comment separate filing we make we to litigation the But around Maybe our regards you Yeah. thinking on cannot our in is it strategy. collecting indications. that

the So where with beginning. gastroparesis, let’s out, is we Phase III stand start

have going ClinicalTrials.gov. we see You’re to that recently a updated

the about to study to recruitment now years. that [in [ph] more up which you for of are this patients before two Remind We’re study. placeholder we year a It a] one placeholders. is there going numbers had actual for of duration for smaller an that XXX says emphasize

a this larger, equipment approximately XXX patients, years, So how expected it duration between the will to study, and is be should have be one XXX I see it’s two to goes. to going of which

II one FDA, that in end suffice, course, filing. effects of examines meeting discussion the of it tradipitant study is additional the this that study, patients of an diabetic with NDA with could the and both current convincing it So idiopathic for Phase is agreed if

the of the But is the course, or it we whether of on study. time that. months post of this XX it data necessary the about at to end have study So collected depends not speed think would

talents has in not for time. of some FDA case Now, the on course, resolved reason, that the these been with

initiate FDA program, those optimization period, to strategy of discussions. already have a the three in patients, course, and have all which placebo-controlled include agreed, submit on the risk but agree XXX been month data has discussion will to none several around marketing – this a of studies post We in begin indicated a we the safety where does we

we’re in On atopic of said the the half second conclude indicated confirmatory before, of first will a and a overlap first XXXX. begin dermatitis, we is first as the we study track on that study wanted with quarter conduct to we as to XXXX. small in And

will So data time, critical on because these the XX-month period not some of take necessarily collection be do of studies path. the

motion we amount should already an short-lived Finally, as case on towards in and filing And know pair data this this is have chronic episodic sufficient preclinical you guidance, is sickness, in of in [indiscernible] NDA marketing. condition. FDA

XXXX. soon that we believe motion III a the Phase initiate sickness as can Phase with of goal as a II and by in we upon FDA, complete possible the successful with and program of meeting So filing end

Chris Howerton

Great.

if very question. helpful. That’s could more Thank just then maybe Okay. And ask you. I one

injectable iloperidone I the is for radar at perspective flying a think, acting the work from under bit. long least little my Fanapt

an would what formulation of of you understand it’d us guess, sense approval that help development be around helpful be do I be? to the path Thanks. you kind and think opportunity a might put that So if could what

Mihael Polymeropoulos

Yeah.

pharmacokinetic Of on is is we Right believe is it And study to multi-dose relapse – an of with a that a study development, so to and running optimal the not this would is delivery, several finalized. a this single sequential the successful the pharmacokinetics, we’re beyond we very and very be identify Phase course, examining similar reported. study lead study that now, those optimal likely very what And type FDA pharmacokinetics where ways actually III expensive periods. that an tolerability. that is have and going we interaction prevention oral where study, a iloperidone close

on the and of is oral, confident of very FDA being the that now. So course, the efficacy label

the of begin program. completion We that will upon and studies pharmacokinetic study

longer] relapse So detail put [ph] probably are the that studies, discuss to the early prevention it I year timeline around to more a year. is These it require best [live in study. think we a excess the initiate would But to the a is But we’re submission. to most little hope so position going in next be of in generally, future. that

Chris Howerton

you Okay. All I appreciate thank for Well, questions. much right. taking it. the very

Mihael Polymeropoulos

Thanks, Chris.

Operator

our And Joel Please you. Beatty Thank from next proceed. Citi. question with comes

Joel Beatty

taking Hi, for question. thanks the

like is think sustainable high a one HETLIOZ, starts. it like was there a and based bit there whether quarters? I a new First on on that patient looks remarks will any – Can you it talk looks number prepared the on of be little lot thoughts future of over about

Mihael Polymeropoulos

Yeah. I’ll address that. Jim let to

James Kelly

Yeah.

how enough patients are of work work can patients done, pleased bring not HETLIOZ make to the really performance just Non-XX. our HETLIOZ [sight] of team, at can’t patients Non-XX, side We and the of and in to blind about that’s but with office psychiatrist’s doctors say [ph] aware the the sales also they to field with help being I continue

the for the that So of to and business. very our we good feel continuing HETLIOZ means about what prospects grow productivity team

Mihael Polymeropoulos

Yeah.

just Just now HETLIOZ trials conditions, in database about of exploring we before initiation have those program have to decided within about database, population, XX,XXX many opted year add the of them the of our especially some And course, a and we’ve begun psychiatric comorbidity. sighted. blind, of of with to called we discussed the now us [ph] understanding that, that that ago, have a people

population. from new potential actually that encouraged this are we actually the So indicating prescriptions, very significant a trajectory that growth by in of patient especially for is psychiatry

Joel Beatty

Great.

the in seems need it the you Another and hold. clinical back question patients getting Can point or partial clinical what become for will XX-month there. future related data discus to the

Mihael Polymeropoulos

a data a future, I I the successful as detail, But in gating not be. maybe pinpoint XX two-year juncture Well, could could the the before in course, explaining course, months but months contained. a as of early as is of become as got time. of within the of I critical factor, if I’ve XX The data Chris. study of explained become the that was speed would question from gastroparesis period collecting now, in from months where yet factor it this XX cannot collection this

Joel Beatty

you. Okay. Got it. Thank

Operator

Please Thank Stifel. our proceed. question next from Archila comes you. Derek And with

Derek Archila

question. Hey, good afternoon, everyone, thanks and the for taking

was if growth quarter, kind I bit then little three just growth talked sighted can back first color seasonality on XQ? one kind coming HETLIOZ for to bit me, the of mean, give color in for you any So therapy kind know, more and you is helping as attributed a type people of qualitative kind more maybe just And – the little don’t that what Jim. of for also between and amount of far I But blind the HPI of a as of what growth. from the And was of the just patients? about

James Kelly

Well, right. All question, for thanks Derek. the

well product. growth that’s team about and out, highlight in field as team offered excellent, in, both about blind that is we of has not maybe accomplish some We us felt on really is so got that the what to there’s great, quarters mean, sighted to The exception important executed to contribute not all got the the traditional move have can quarter you’ve productivity detail we been with that great. We our and and question aspects. the forward. type I and no What This has say excited what patients Non-XX reality I you’ve was continue that of our would one it. except great some quarter

Derek Archila

of sales of so you guidance guess, here right given kind stated, just why to follow-up just not bullishness it. kind the Got and And performance in XQ that of raise kind now. a that I the then one,

from you’re So tracking some of factors are to? that now it the you kind are you’re the what’s that guess, there I doing or preventing and waiting XQ not reason

Mihael Polymeropoulos

is We Jim let like But I it quarter. the course a I’ll with to cannot take have. that we excited and guidance. future too seasonality did that] understand we [Well, [ph]. are with early precision. we’re and QX, about there of the into great come is excited We say a

James Kelly

an course QX. to everybody, of giving together talk And we when get update look back about Yeah. forward and to we

I that years our real HETLIOZ quarter-to-quarter, that is of to about think talk should the year-to-date to people we the the a take to important come, thing may is the program. think, is growth asset, and that’s out HETLIOZ way while as continue we performance grow

Derek Archila

our it. came in as question, Got this lot just And R&D to perspective, an lighter from then of relative one, last modeling consensus. you is more well so numbers a

far So stepped because some should be Thank the studies? should I think half, in about how you’re maybe that? of we you. any guess, that we how qualitative kind Or second sort thinking as guidance up of starting as

Mihael Polymeropoulos

Yeah.

we of here. may but incredibly excited an in variability about heard have including go QX sickness describe You you you just tradipitant expect the and increase the to we quarter-to-quarter the progress, in go mention quarter-to-quarter. from programs inherent to R&D especially to see year we’re one that any motion as is gastroparesis, the programs as we’ve the of Any variability, QX got and sort

towards we have and year activity exciting space really eye think, continued I a R&D since lot studies our the of progresses, ongoing.

Derek Archila

congrats quarter. and on Thanks Great. the

Mihael Polymeropoulos

Yeah.

Operator

to concludes the our management session. Thank to back remarks. turn for you. closing I’d over Vanda call This like Q&A

Mihael Polymeropoulos

much joining again very and us, talk we’ll for all you Thank soon.

Operator

conference. thank This gentlemen, you concludes and for Ladies participation your the today’s in program.

You great disconnect. Everyone may have now a day.

Vanda Pharmaceuticals (VNDA) 31 Jul 192019 Q2 Earnings call transcript