PDT - DUSA Pharmaceuticals, Inc.

DUSA PHARMACEUTICALS, INC.®
Bob Doman
President & CEO
Rich Christopher
VP Finance & CFO
June 28, 2007
Forward Looking Statement
Except for historical information, this presentation contains certain forwardlooking statements that involve known and unknown risks and uncertainties
which may cause actual results to differ materially and adversely from the future
results, performance or achievements expressed or implied by the statements
made. These statements relate to the Company’s expectations for development
and timing of the Company’s product pipeline and new dermatology indications,
including acne and photodamaged skin; anticipated progression of AKs to
squamous cell carcinoma and increases in AK reimbursement amounts;
sponsorship of non-melanoma skin cancer studies; plans for development of
acne; expectations for final pricing and launch in Latin America by Stiefel and in
Asia by Daewoong of the Company’s Levulan product; the potential market
opportunity and revenues for acne; expected continued growth of
Levulan®,ClindaReachTM, and launch of new ANDA product for rosacea; and
expectations for licensing or strategic partnering opportunities. Such risks and
uncertainties include, but are not limited to, the clinical trial process and results
thereof, the regulatory and product pricing approval process, sufficient funding
for development programs and business opportunities on acceptable terms,
government funding of NCI, changing market conditions, product development
activities, the impact of competitive products, changes in healthcare
reimbursement, insurance coverage and pricing, the Company’s ability to
penetrate the market with its products, obtaining and maintaining regulatory
approval of the Company’s products, the Company’s dependence on third-party
manufacturers and distributors, the ability to maintain its proprietary rights and
its patent portfolio and other risks detailed from time to time in the Company’s
United States Securities and Exchange Commission (SEC) filings.
DUSA Pharmaceuticals, Inc.®
DUSA is a dermatology company with 4 key
marketed products:
Levulan® Photodynamic Therapy (PDT)
for Actinic Keratosis (Grade 1 and 2 of
face or scalp)
ƒ
Kerastick® and BLU-U®
BLU-U® for moderate acne
Nicomide® - vitamin-based oral Rx for
patients with inflammatory skin
conditions such as acne
ClindaReach™ for acne in hard to reach
places, e.g. - the back
DUSA Sales Timeline
2000 - FDA approval of Levulan® PDT for actinic keratoses (AKs)
2002 - Terminated marketing agreement with Schering AG
2003 - Began DUSA U.S. sales force – 6 reps - sales: $1 M
2004 - Expanded sales force to 16 - sales: $8 M
2005 - Expanded sales force to 24 - sales: $11.3 M
2006 - Signed Licensing Agreement with Stiefel Laboratories; acquired
Sirius Laboratories March ’06; sales force increased to 34 reps
- sales: $25.6 M
2007 - Signed Licensing Agreement with Daewoong Pharmaceutical;
launched ClindaReach™
Investment Fundamentals
Shares outstanding = 19.5M (22.5M FD)
Market cap 6/15/07 = $69M
Cash/equiv. 3/31/07 = $16.5M
Cash burn Q1 ’07 = $1.7M
NOL carry-forwards = $83.3M
Revenue and Gross Margin
In $M's
2003
Revenue
Kerastick
BLU-U
PDT Subtotal
Non-PDT
Total
Margin %
Kerastick
BLU-U
PDT Subtotal
Non-PDT
Total
$
$
$
0.9
0.1
1.0
N/A
1.0
N/A
N/A
-259%
N/A
-259%
2004
$
$
$
5.9
2.1
8.0
N/A
8.0
65%
13%
51%
N/A
51%
2005
$
$
$
8.9
2.4
11.3
N/A
11.3
2006
$
$
$
60%
-8%
45%
N/A
45%
Note: Margins exclude certain acquistion related non-cash items: amortization of intangible assets and inventory write-up
to fair value
13.6
2.5
16.1
9.5
25.6
75%
15%
65%
82%
71%
Levulan® Kerastick®
2007 price - ~$110 per stick; 6/box
BLU-U®
Actinic Keratoses (AK)*
Pre-cancerous skin lesions
5.5 million patient visits per
year in the U.S.1
Up to 10% of active lesions
will eventually progress to
squamous cell carcinoma
Liquid nitrogen (70-80%) and
topical Rx creams e.g. 5-FU,
imiquimod (20-30% ~$200M annual sales) 2
1- Physician Drug & Diagnosis AuditMAT/July 2006 Verispan Inc.
2- Vector One National Audit- MAT/July 2006,
Verispan Inc.
*Grade 1 or 2 AKs of the face or scalp
Photo courtesy of
Dr. James Kennedy, Queen’s
University, Kingston, Ontario
Standard Treatments
Not Satisfactory For Many Patients
Standard Treatments
Adverse Effects
Liquid nitrogen (cryo) MD freezes individual lesions
Cryo painful, blisters; can
leave white spots or even
depressed scars
Creams slow; skin gets red,
Topical creams
raw; sometimes painful; poor
5-FU (Efudex®, Carac®)
compliance (up to 60%)
imiquimod (Aldara®)
diclofenac sodium (Solaraze®)
- applied by patients for
2-16 weeks
LEVULAN PDT: Independent Investigator Study
Avram D, Goldman M. Effectiveness and safety of ALA-IPL in treating actinic keratoses
and photodamage. J Drugs Dermatol (Supplement) 2004; 3: S36-S9.
Touma D, Yaar M, Whitehead S et al. A trial of short incubation,
broad-area photodynamic therapy for facial actinic keratoses
and diffuse photodamage. Arch Dermatol 2004; 140: 33-40.
(Independent Investigator Study)
U.S. Topical AK Therapy Market by Brand
Vector One National Prescription Audit (VONA) - MAT Dec 06, Verispan, Inc.
U.S. Topical AK Market
Dermatologists only:
Aldara
24%
Efudex
35%
Solaraze
17%
• 957,510 TRxs
• Growth rate 10%
U.S. Levulan® Market
Opportunity for AKs
$150 Million
Carac
20%
Gen. Top. 5FU
2%
Fluoroplex
1%
* Assumes that 50% of TRxs for Aldara are prescribed to treat AK
Source- Verispan Physician Diagnosis and Drug Audit (MAT/Jul 2006)
AK Reimbursement (to MDs)
Treatment Fee
J-Code
(Drug)
Office Visit
Payment per AK, 1-15
AKs (‘17000’ codes)
N/A
Included for
AK treatment
2006
$60-$200
$0
$0
2007
$74-$156
$0
$0
$0
$0
~$40 (avg.)
Cryotherapy
Rx Creams
e.g. 5-FU, imiquimod,
Light Treatment
(CPT code 96567)
Topical PDT
2004
$38
$85
~$40 (avg.)
2005-2006
$75
$100-$105
~$40 (avg.)
2007
$92
$105+
~$40 (avg.)
$105 > $143
$110+
~$40 (avg.)
2008-2010 (CMS plan)
International Guidelines Recommend
PDT As First Line Treatment For AKs
Braathen L, Szeimies RM, Bassett-Sequin N, et. al.,
Guidelines on the use of Photodynamic Therapy for
Nonmelanoma Skin Cancer: An International Consensus.
J Am Acad Dermatol 2007: 125-143
PDT recommended by a consensus group of physicians
as a highly effective “first-line treatment’’ for AKs
Recommendations based on the quality of evidence for
efficacy, safety/tolerability, cosmetic outcome, and
patient satisfaction/preference
US Kerastick® Sales by Quarter
45,000
40,000
35,000
30,000
25,000
2005
2006
2007
20,000
15,000
10,000
5,000
0
1st Qtr
2nd Qtr
3rd Qtr
4th Qtr
PDT Customer Segments ’05/’06
# of Customers
800
700
600
48%
18%
20%
24%
500
2005
2006
400
300
200
100
36%
0
Med/Cos Med Derm CosD/Spa Hosp/VA
Others
PDT Customer Segments ’05/’06
# of Kerasticks
45,000
40,000
86%
27%
35,000
30,000
25,000
2005
26%
20,000
2006
12%
15,000
10,000
76%
5,000
Med/Cos
Med Derm CosD/Spa Hosp/VA
Others
Moderate to Severe Acne
Moderate to severe acne market - 20-30%
of total acne, or ~$1B/yr
Problems with current treatments and/or
oral antibiotics, plus topicals
Isotretinoin (Accutane®)* – FDA mandated
iPledge national registry as of March 2006 due
to side effect risks, including birth defects
Oral antibiotics often used for months or years,
leading to increased risk of antibiotic resistance,
respiratory infection, internal cancers, etc.
*Accutane® is a registered trademark of Hoffmann-LaRoche
3 months after 2 BLU-U® (light only) treatments and 1
Levulan® BLU-U® treatment (15’ drug, 8’ light)
(Independent Case Report)
Photos courtesy of
Mitchel Goldman, MD - La Jolla, CA
Member of DUSA Pharmaceuticals Medical Advisory Board
Acne – Development Plan
Phase IIa study: Levulan® and BLU-U® vs BLU-U®
plus vehicle (active control) - both arms improved
~70%
Enrollment criteria included non-inflammatory
acne
All patients pre-treated with acetone
72 subjects; 3 sites; 3:1 study design
Levulan® + BLU-U® appeared to be more effective
for severe acne (Grade 4)
Phase IIb study initiated Q1 ’07
Levulan® and BLU-U® vs BLU-U® plus vehicle
Primarily severe (Grade 4) acne
No acetone
>250 patients; 12 sites; 1:1 study design
Partnerships for Levulan® PDT
Outside of North America
Stiefel - Latin America (LA)
A leading derm company world-wide
Presence in 20+ countries in LA
220+ sales and marketing personnel in LA
#1 in Brazil and Chile (Rx products)
Brazilian regulatory approval Q4 ’06
Currently awaiting acceptable final pricing
approval
Daewoong - South Korea, China, India
A key regional derm company
Sells Botox and Radiesse in South Korea
SK approval expected Q1 ’08
Levulan® PDT for High-Grade Dysplasia (HGD)
in Barrett’s Esophagus
Opportunity: Current therapies have
significant drawbacks – scarring, morbidity,
mortality
Independent investigator studies showed
HGD eliminated in 80-100% of treated
patients, recurrence not seen for 2-3 years
DUSA feasibility study showed 5/6 patients
were cleared of HGD for 2 years
DUSA’s proprietary endoscopic light
delivery device – simplifies treatment
FDA granted Orphan Drug Designation
Photo courtesy of
Dr. Clive Kelty, University
of Sheffield, UK
Nicomide®
Vitamin-based prescription oral
product for patients with
inflammatory skin conditions such as
acne
Avoids risks of oral antibiotics
196K Rx’s written in 2006
Generic competition re-entered
market in March
Currently in discovery phase of
litigation and re-examination at
USPTO
ClindaReach™
ClindaReachTM System
combines clindamycin, a
widely prescribed topical
antibiotic, with a unique
EasyReach applicator, to
provide an easy and efficient
method for treating hard to
reach acne.
86% of physicians stated they
would expect to see increased
patient compliance with
ClindaReachTM*
Launched March 2007
*DUSA Market Research
Derm only Acne Therapy Market
TRxs & Share – Dermatologists Only
7M TRxs / Year from Derms for topical acne therapies
5.4 M TRxs for tetra-based oral antibiotics 12.7 M Total
Topical Acne Market
Topical Retinoids
Topical Clindamycin
(2.7M)
20%
BPO Cleansers
(1.4M TRxs)
BPO Gels
BPO Combinations
10%
(1.5M)
Azelaic acid 20%
(675K)
Other Topical Antibiotics for
Acne
Product Pipeline - NDAs
PRODUCT
PRE-CLINICAL
CLINlCAL
I
Levulan® PDT for
Moderate-Severe Acne
Levulan® PDT for SCCSolid Organ Recipients
Levulan® PDT for Barrett’s
Esophagus Dysplasia
(under review)
Levulan® PDT for Oral
Cavity Dysplasia (to be initiated)
II
III
FILED
Product Pipeline – ANDAs
PRODUCT
ClindaReach™
Topical Rosacea
INITIAL R&D
FILED
LAUNCH
DUSA Medical Advisory Board
Diane Berson, MD - Cornell University Medical College
Barbara Gilchrest, MD - Boston University School of Medicine
Michael Gold, MD - Gold Skincare
Peter Lee, MD - University of Minnesota Medical School
Alan Shalita, MD - SUNY Downstate Medical Center
Guy Webster, MD - Jefferson Medical College
Experienced Management Team Combining
Pharmaceutical and Medical Device Expertise
Geoffrey Shulman, MD, FRCPC - Chairman & Chief Strategic Officer
Former President & Chairman, Draxis Health Inc., Dermatologist
Robert Doman - President & Chief Executive Officer
Former President, Leach Technology Group; also at J&J, BMS
William O’Dell - Executive VP, Sales & Marketing
Stuart Marcus, MD, PhD - VP Scientific Affairs & CMO
Richard Christopher - VP Finance & CFO
Scott Lundahl - VP RA & IP
Mark Carota - VP Operations
Michael Todisco - VP, Controller
Value Drivers - 2007 and beyond
Continued growth in US Levulan® PDT business
Levulan® PDT Latin America launch (Stiefel); Korean
launch Q1 ’08 (Daewoong); complete European
licensing agreement
Additional CMS reimbursement increases for PDT
scheduled for ’08, ’09 and ’10
Minimize competitive impact on Nicomide®
Grow ClindaReach™ and launch next ‘Sirius’ ANDA
product Q1 ’08
Continue Phase llb clinical trial on acne
Develop and/or license internal indications for PDT