Developing Orphan Products for Patients with Rare Gastrointestinal and Endocrine Disorders August 2012
May 26, 2015
Developing Orphan Products for Patients with Rare Gastrointestinal and Endocrine Disorders
August 2012
2
Safe harbor statement
Statements made in this presentation, which are not historical in nature, such as the timing of the potential regulatory submission, approval process and commercialization of the company’s late-stage registration programs, the company’s expected future cash flows from the company’s royalty-based portfolio of products and product candidates, the company’s future operations and the company’s 2012 cash burn guidance, constitute forward-looking statements for purposes of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. These statements are based on the company's current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements, such as the risk that we do not receive regulatory approval to market our late-stage registration programs in a timely manner, or at all, the risk that we fail to maintain our existing collaborative relationships related to the company’s royalty-based portfolio of products and the risk that our cash flows are lower than expected due to increased expenses or lower cash in-flows from applicable collaborations, as well as other risk factors described in the company’s periodic filings with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K and Form 10-Qs. All information in this presentation is as of the date of this presentation and NPS undertakes no duty to update this information.
August 2012
3
NPS value proposition is defined by a near-commercial pipeline, significant royalty cash flows, and a strong operational position
Valuable royalty-basedportfolio expected to significantly enhance
cash flows
• Royalties on Sensipar®/Mimpara® represent significant value
• FY11 sales of $808M (up 13% YOY) and YTD 2012 through 6/30 $444M (up 16% YOY)
• Partially monetized as non-recourse debt ($92M at 6/30/12, 9% interest); first $32M per year of royalties withheld to repay debt with $50-60M + excess paid to NPS
• Debt expected to be repaid in mid-2015; NPS to receive 100% of royalties through 2018
• Royalties on Nucynta® and Revestive® are unencumbered
Near-commercial, orphan product
candidates with strong market potential
• Gattex® (teduglutide) in short bowel syndrome (SBS)• Expected NDA approval in 2012; EU marketing authorization expected 3Q12
• Natpara™ (PTH 1-84) in hypoparathyroidism• Expected BLA filing in 2012 and approval in 2013
• NPSP790 and NPSP795 (calcilytics): potential in ADHH, an ultra-orphan disorder
Strong operational position
• $135M1 in pro-forma cash and investments at 06/30/12; adequate cash to launch both products
• Only recourse debt is ~$17M convertible note due in 2014
• Management team with proven track record of developing and launching orphan products
• Strategic outsourcing business model maximizes operational efficiencies
1 25M payment received from Amgen in July 2012
NPS’ product pipeline is highlighted by two advancing registration programs and a potential product launch in 2012
Product/productcandidate Indication Preclinical P1 P2 P3 Regulatory
review Marketed Notes/partner
GATTEX Short bowel syndrome Nycomed/Takeda (Ex-North Am.)
NATPARA Hypoparathyroidism Nycomed/Takeda (Ex-North Am.)
NPSP790 & NPSP795 ADHH* WW rights
Teduglutide Pediatric/other Nycomed/Takeda (Ex-North Am.)
Sensipar/Mimpara Secondary & primary hyperparathyroidism
Amgen (WW Ex-Asia)
REGPARA Secondary hyperparathyroidism
Kyowa Hakko Kirin (Asia)
Preotact Osteoporosis Nycomed/Takeda (Ex-North Am.)
NUCYNTA Moderate/severe pain Janssen (US)
Revestive Short bowel syndrome Nycomed/Takeda
Cinacalcet HCl Post renal transplant Amgen
Ronacaleret Bone disorders GSK (WW)
4*Autosomal dominant hypocalcemia with hypercalciuria
NPS is well-equipped to transition into a commercial company and deliver significant value-drivers in 2012
Milestone StatusGATTEX in short bowel syndrome:
Acceptance of NDA submission
FDA Advisory Committee meeting 2H12
Positive CHMP opinion
Commercial and supply-chain readiness 2H12
FDA approval of GATTEX 2H12
Commercial launch of GATTEX 2H12
NATPARA in hypoparathyroidism:
Hold pre-BLA meeting with FDA
Report additional REPLACE data
Submit U.S. BLA 2H12
NPSP790 and NPSP795 (calcilytics):
Define development strategy 2012
Teduglutide in additional indications:
Define development strategy 2012
5
GATTEX® (teduglutide) in Short Bowel Syndrome
SBS is a highly disabling disorder that is often managed with parenteral nutrition (PN) and intravenous (IV) fluids
7
Typically occurs after extensive intestinal resection due to disease or injury
Remaining gastrointestinal tract unable to absorb sufficient nutrients and/or fluids on a conventional diet
Patients may have to rely on parenteral nutrition or IV fluids to survive
Patients are socially and personally impaired
The largest obstacle is the need to be ‘hooked-up’ to PN for many hours per day
Disorder characteristics
Patients are on PN/IV fluid for ~6 nights per week; 8 to 12 hours a day
Can lead to serious life-threatening complications, including infections, blood clots, and liver damage
Socially and personally constraining: diarrhea, frequent urination, difficulty sleeping and loss of functional independence
Reduced 5-year survival*
30 to 80% probability of survival depending on age at PN initiation
Challenges of PN/IV fluid dependence
Goal of GATTEX therapy: improve the structural and functional integrity of the remaining intestine
* Survival of Home Parenteral Nutrition-Treated Patients: 20 Years of Experience at the Mayo Clinic. Scolapio et al. Mayo Clin Proc 1999;74: 217-222
GATTEX® (teduglutide) is a GLP-2 analog that could be a first-in-class treatment for adult SBS
GLP-2 is a 33-amino acid endogenous peptide secreted from intestinal L-cells after meal ingestion
Physiological properties of GLP-2:
Expands intestinal mucosa
Enhances nutrient absorption
Stimulates intestinal blood flow
Increases intestinal barrier function
GATTEX (teduglutide):
DPP-IV degradation resistant recombinant human GLP-2 analog
Differs from GLP-2 only by an N-terminus substitution of glycine for alanine in position 2
Extends half life from 7 minutes to 2 hours
Once-daily subcutaneous injection
Patent exclusivity through April 2020 and orphan designation
8
9
STEPS Phase 3 registration study and STEPS 2 open-label continuation study design
STEPS 2: 24-month open-label continuation study
STEPS: 24-week Phase 3 registration study
PN optimization
and stabilization
~4-16 weeks
GATTEX 0.05 mg/kg/day
(n=43)
GATTEX 0.05 mg/kg/day
GATTEX 0.05 mg/kg/day
Placebo(n=43)
Enroll Randomize (baseline)
24 weeks TLR1Q11
LPLV 1Q13
Phase 3 STEPS data presented at DDW 2011 show GATTEX reduces parenteral nutrition dependence in adult SBS patients
63%
30%
0%
40%
80% Primary endpoint: 20% to 100% reduction of
PN/IV from baseline at weeks 20 & 24
63% of GATTEX patients achieved endpoint vs. 30% for placebo (p=0.002)
At week 24, GATTEX patients achieved a mean 4.4L (34%) reduction in weekly PN/IV volume from 13L baseline vs. 2.3L (18%) for placebo (p<0.001)
Despite the significant reduction in weekly PN/IV volume, GATTEX patients maintained their nutritional status
Body weight was stable for GATTEX-treated patients
Liver function: statistically significant improvement seen in ALT, AST, and bilirubin values in the GATTEX group vs. placebo
-5
-2
1
Lite
rs p
er W
eek
*
Resp
onde
r ra
te
n=43 n=43*p=0.002
**p<0.001
4.4L**
2.3L
n=39
n=39
GATTEX
Placebo
Baseline PN/IV volume:GATTEX: 12.9LPlacebo: 13.2L
10
In the 24-week Phase 3 STEPS registration study GATTEX significantly reduced PN/IV volume requirements
11
Week
PN/I
V lit
ers
per
wee
k
GATTEX
Placebo
*
**
***
***
***
******
p≤0.05
p≤0.01
p≤0.001
Baseline volume:GATTEX: 12.9LPlacebo: 13.2L
Gattex achieved greater reductions in fluid composite effect versus placebo
-2.63
-3.46-4.25 -4.05
-4.65-5.38
-0.38-0.99 -1.29 -1.25 -0.93 -1.07
-6
-5
-4
-3
-2
-1
0
4 8 12 16 20 24
GATTEX
Placebo
12
Lite
rs/w
eek
Weeks
Change in urinary output, oral intake, and PN/IV volume
And 54% of GATTEX-treated patients achieved one or more days off PN/IV at week 24 of Phase 3 STEPS study
13
43
1
6
1 1 1
0
2
4
6
8
10
12
14
1 to <2 2 to <3 3 4
GATTEX: ≥ 1 day = 21/39 (54%) Placebo: ≥ 1 day = 9/39 (23%)
13
P=0.0047
# o
f pa
tient
s
Reduced days per week
12-month data further supports the potential of GATTEX with some patients achieving independence from PN/IV
STEPS 2 interim analysis for 34 patients who had received 12 months of treatment
91% of patients achieved a 20% to 100% reduction in PN volume
Mean reduction in PN/IV volume was 5.2 liters per week or 40% from pre-treatment baseline
24% of patients (8/34) reduced their infusion days per week by three or more
As of May 2012, seven patients have achieved independence from PN/IV while on Gattex in STEPS 2
14
53%
38%
24%
0%
10%
20%
30%
40%
50%
60%
1 to <2 2 to <3 3
GATTEX: ≥ 3 days = 24% (13/34)Pe
rcen
tage
of
patie
nts
Reduced days per week
NPS submitted its New Drug Application for GATTEX in 4Q11 and is preparing for a number of key potential events in 2012
15
NDA submitted
NDA accepted
FDA Advisory
Panel
EMA approval
Commercial launch
4Q112012
1Q 2Q 3Q 4Q
Sep. 30 PDUFA
Positive CHMP Vote
Gattex commercial launch strategy is based on 5 strategic objectives
Commercial leadership with extensive experience with orphan disorders
Commercial build-up gated by key milestones Positive Phase 3 results
NDA acceptance
Positive Advisory Committee
NDA Approval
Focus on patient identification
Secure market access and reimbursement
Offer personalized patient services
16
Patient identification is key in the orphan drug space
Prevalence versus reachable patients
Treatment flow from resection to home healthcare with PN/IV fluids
Patient-sourcing tactics:
Patients / sites enrolled in clinical development program
Partnering with patient advocacy groups
NORD, the Oley Foundation, ASPEN, etc.
Leveraging internet and social media activities
Shortbowelsupport.com
Online forums
Deployment of MSLs
Networking with thought leaders and centers of excellence
Potential collaboration with home infusion companies
17
Access and reimbursement critical to a successful launch and should not be underestimated
Market access studies 13 payers - 155 MM lives and 12 payers - 118 MM lives
SBS / Gattex reimbursement profile: Orphan status - unmet medical need – solid clinical evidence
Price inelastic with hurdles to reimbursement
SBS patients’ reimbursement coverage 85% of SBS patients have coverage
~60% commercial, ~20% Medicare, and ~20% Medicaid
Internal expertise Successful track record of securing access and reimbursement to orphan drugs
Operational elements Health economics-based value proposition ready at launch
Gattex launch with co-pay and co-insurance support
Go-to-market limited to specialty pharmacy network
18
Patient HUB will offer personalized service to each Gattex patient
Personalized service will accompany each SBS patient throughout the Gattex experience
The patient services HUB Manned by NPS care coordinators
Coordinate clinical services
Avoid any additional burden to the prescribers
Expected deliverables Mitigate patients’ reimbursement challenges
Educate patients about Gattex characteristics and use
Support REMS (if need be)
19
NPS Advantage™ (patient services HUB; back office support)
Reimbursement services
Patient assistance evaluation
Adverse event reporting
Product complaints & returns
After hours call center support
Data services and management
Patient-centric commercial strategy will focus on burden-free access and care through a single NPS contact - Care Coordinator
20
HCP office &“start” form
NPS Care Coordinator(customer facing) Patient
On-call nurse
Dietitian/nutritionist
Home health care nursing
Pharmacist
Summary of GATTEX in SBS
SBS is a rare and chronic disorder with an estimated U.S. prevalence of ~10-15 thousand
Patients are dependent on PN/IV fluid for nutrient and fluid support
This supportive care significantly impacts patients lives
Associated with serious and sometimes life-threatening complications
Comprehensive, patient-centric strategy underway
Limited competition
Positive reimbursement and pricing outlook
Market is accessible with a relatively small commercial infrastructure
GATTEX is a first-in-class treatment that address the underlying goal of SBS therapy –improving intestinal absorptive capacity and reducing dependence on PN/IV fluids
Significantly reduces PN/IV fluid volume dependence
Significantly reduces the number of infusion days per week
Achieves complete weaning off of PN/IV infusions for some patients
IP exclusivity through April 2020
21
NATPARA™ in Hypoparathyroidism
When the parathyroid (PTH) gland cannot produce PTH normally, homeostasis of calcium and phosphate cannot be achieved
There are multiple dimensions of and consequences to hypoparathyroidism
Hypocalcemia
Hyperphosphatemia
Renal wasting of calcium which can cause hypercalciuria
Bone, muscular, nerve, and kidney complications
No approved PTH replacement therapy
Current approaches aim to reduce severity of symptoms by raising serum calcium levels with calcium and active vitamin D supplementation
Active vitamin D and calcium supplementation can worsen complications
Hypercalciuria
Hyperphosphatemia
Irreversible complications of the kidney, eye, heart, and brain
23
Hypoparathyroidism complications range from mild or moderate symptoms to irreversible complications
24
Symptoms and complications: Paresthesias (tingling, numbness) Carpopedal spasm (violent, painful
contraction of the muscles in the hand/feet) Tetany (involuntary muscle
contraction/cramping) Seizure Bradycardia Hypercalciuria (excessive urinary calcium
excretion) Hyper-mineralized bone Vitamin D intoxication
Irreversible complications can include: Kidney stones End-stage renal disease Cardiovascular diseases Calcium deposits in the brain Cataracts
http://www.mayoclinic.com/http://www.uptodate.com/Velasco et al, ” Psychiatric Aspects of Parathyroid Disease “ Psychosomatics 40:6, November-December 1999
n=268
39%
21%
12% 11%
0%
10%
20%
30%
40%
CognitiveImpairment
NonspecificPsychiatricSymptoms
NeuroticSymptoms
Pychosis
% o
f Pa
tient
s
Hypoparathyroidism cognitive and psychiatric complications
New research presented at ENDO 2012 underscores high burden of disease for hypoparathyroidism
Investigators from Mass General and Brigham and Women’s Hospital presented “Long-term follow-up of patients with hypoparathyroidism – a cohort study” by Mitchell et al.
Detailed chart reviews of 120 patients (with observation period of 7 years (IQR 4-14)) 73% were female, mean 52 years (range 2-87), 66% post-surgical
Renal effects: 38% (20/53) had a 24-hour urine calcium level ≥ 300mg*
31% (17/54) had renal calcifications or stones
41% had eGFR <60 mL/min/1.73m2
2% required renal transplantation
52% (16/31) had basal ganglia calcifications
8% (10/120) had at least one hypocalcemic seizure
33% were evaluated in an emergency department or hospitalized for hypoparathyroidism complications, including 7% in the last year of observation
Conclusion: data show that hypoparathyroidism and its treatment carry an unexpectedly high burden of disease
25
*Normal urine Ca excretion 50-300 mg/24 hr
Note: Per National Kidney Foundation, the GFRs associated with the stages of chronic kidney disease are as follows: stage 1 GFR<90, stage 2 GFR 60-89, stage 3 GFR 30-59, stage 4 GFR 15-29, stage 5 GFR<15.
There is a disconnect between patients and physicians about hypoparathyroidism…
“It takes a long time to get a diagnosis and is hard to control”
“Hypoparathyroidism is fairly simple to diagnose and easy to control”
“I go from physician to physician in search of a knowledgeable about treating my disorder”
“The disease is fairly simple and straight forward” (under value the disease)
“Taking multiple pills per day and being a calcium roller coaster is a major burden”
“It’s not a big deal to have to take calcium and vitamin D”
“I get brain fog and cognitive effects”
“The cognitive issues are not a part of the disease” (discount cognitive effects)
PhysicianPatient
26
New patient research recently launched to better describe hypoparathyroidism burden of illness and patient challenges
Recently launched PARADOX – Patient Attitudes and Responses About Disorder Outcomes eXplored
In partnership with The Hypoparathyroidism Association and the Mayo Clinic
Designed with input from physician thought leaders and patients
Communicate the burden of illness to the broader community (physician, payer, patient, regulatory) in advance of launch
Giving patients a voice to help validate the physical, emotional, and quality-of-life challenges they experience every day
Market research suggests patients are very frustrated; no one understands their plight
27
I can’t be alone anymore. I can’t drive. The looming fear of tetany and even a seizure hangs over me constantly. Physically, I can’t use my legs for very long without them feeling numb, so simple trips to the store or even doing things with my family, like playing with the children, going on walks, hiking—all things we used to do—become challenging.
-- Amy, age 42
NATPARA could be a major advance in treating hypoparathyroidism
The first and only bioengineered replica of the full-length endogenous 84-amino acid parathyroid hormone
The mechanism of action offers a more physiological outcome with the potential to reduce long-term complications
Potential to reduce large fluctuations in their serum calcium levels
NATPARA will be available in multiple dosages to allow for personalized treatment
U.S. exclusivity: Patent exclusivity through December
2018
Orphan status with BLA market exclusivity expected through 2025
28
29
NATPARA™ Phase 3 registration study (REPLACE)O
ptim
ize
~0-
10 w
eeks
Randomize (Baseline)
N=134
50mcg75mcg
100mcg
Insufficient response – titrate up
Week 24 (endpoint)
Adjust vitamin D and calcium
Dosetitration
Randomized, double-blind, dose escalating, placebo-controlled
Primary endpoint: maintain serum calcium while reducing calcium and vitamin D analog supplementation by 50%
Once-daily SC injection administered with a pen
NATPARA
Placebo Placebo 1Placebo 2
Placebo 3
4-week follow-up
24-week Phase 3 REPLACE study delivered statistically significant results; data presented at ENDO 2012
Primary endpoint: maintain serum calcium while reducing calcium and vitamin D analog supplementation by 50%
Secondary endpoint: percentage of patients who achieved independence from active vitamin D and decreased oral calcium to 500 mg or less
NATPARA was well tolerated and compliance was high
93% (84/90) of NATPARA-treated patients completed the study versus 82% (36/44) of placebo-treated patients
Similar incidence of adverse events and serious adverse events for both groups
53%
2%0%
20%
40%
60%
Natpara Placebo
30
43%
5%
0%
20%
40%
60%
Natpara Placebo
p<0.0001
p<0.0001
Resp
onde
r ra
teRe
spon
der
rate
Primary endpoint: ITT analysis
N=90 N=44
N=84 N=37
% of patients who achieved independence from supplementation at week 24
NATPARA is on track for a 2013 launch as the first approved hypoparathyroidism replacement therapy
31
4Q11 2012 2013
Nov. 7, 2011: Positive Phase 3
Results
Presentation of additional data
Submit US BLAPre-BLA
meeting with FDA
FDA Advisory Panel
Potential FDA Approval
Commercial launch
Market-sizing research estimates a U.S. prevalence of ~65,000 insured patients
Study used the IMS Life-Link Health Plan claims database, with 60 million unique U.S. patients and two epidemiologic approaches to improve validity
Captured the number of cases over a 12-month period (October 2007-September 2008)
Two methodologies based on claims data
Prevalence-based approach calculated using hypoparathyroidism diagnosis and hypocalcemia diagnosis with known hypoparathyroidism indicators (neck surgery, etc.)
Incidence-based approach calculated by counting the number of parathyroidectomy, thyroidectomy and neck dissection surgeries
Both methods in the study arrived at a similar estimate of ~60,000 to 65,000 insured patients with chronic adult hypoparathyroidism
Research recently presented at American Association of Clinical Endocrinologists (AACE) and International Society for Pharmacoeconomics and Outcomes Research (ISPOR) meetings
Epidemiological research provides directional support of market size however, market development and patient finding activities complement estimates from the “bottom up”
32
Treating the underlying cause ranked as the most important in terms of unmet needs and the greatest advantage of NPSP558’s profile
Over 50% of physicians interviewed indicated they will be early-adopters
Mild, moderate, and severe cases were largely categorized based on symptoms
Largest expected use in moderate to severe
Market research underscores the favorable market dynamics for hypoparathyroidism
33
Source: 2010 third-party market research funded by NPS
Chronic cases
Survey of 290 physiciansSevere
Moderate
Mild
Summary of NATPARA in hypoparathyroidism
Hypoparathyroidism is a rare and chronic disorder with an estimated U.S. prevalence of 80,000+ (60-65,000 insured)
There is no approved long-term PTH replacement therapy
Current treatments aim to manage symptoms through calcium and active vitamin D supplementation Can exacerbate the condition and cause irreversible complications of the kidneys, heart, brain,
and eyes
Patients are often highly symptomatic (tingling, parathesias, tetany, seizure, etc.) and complications range from mild to moderate to irreversible complications, such as renal disease
NATPARA could be the first approved long-term replacement therapy for hypoparathyroidism Offers a more physiological treatment outcome
Significantly reduces calcium and active vitamin D supplementation
Achieved complete weaning from supplementation for nearly half of patients
Well tolerated with 93% of NATPARA-treated patients completing the REPLACE study
34
Financials & Summary
36
Pro forma cash and investments1 $135
Current liabilities2 $35
5.75% convertible debt due 2014 ($5.44 conversion) $17
Non-recourse debt3 $166
Shares outstanding 86
2012 cash burn guidance1 $60-70
Key financial information
1 Includes impact of June 2012 Amgen / Sensipar transaction2 Excludes amounts associated current portion of non-recourse, Sensipar- and Preotact-secured non-recourse debt of $8M3 Long-term, Sensipar-secured non-recourse debt is $92.3M
06/30/12(in millions)
In summary, the NPS investment offers multiple value drivers
Two near-commercial orphan product candidates with positive Phase 3 results and strong top- and bottom-line potential
GATTEX® expected to be approved in late 2012 for the treatment of adult SBS
U.S. BLA submission for NATPARA™ in hypoparathyroidism on track for 2012
Valuable royalty-based portfolio
Sensipar/Mimpara royalties expected to significantly enhance cash flows in 2012 through 2018
Partially monetized as non-recourse debt ($92M at 6/30/12, 9% interest); first $32M per year of royalties withheld to repay debt with excess paid to NPS
Debt expected to be fully repaid in mid-2015; NPS to receive 100% of royalties through 2018
Strong operational position
$135M in pro-forma cash and investments at 06/30/12; adequate cash to launch both products
Solid management team with a proven track record for delivering on stated objectives
Strategic outsourcing business model maximizes operational efficiencies
37
Developing Orphan Products for Patients with Rare Gastrointestinal and Endocrine Disorders
August 2012