BioMarin Pharmaceutical Annual Report 2005

Plain-text annual report

��Pipeline Preclinical Phase 1 Phase 2 Phase 3 BLA/NDA/MAA On The Market Naglazyme for MPS VI Aldurazyme for MPS I Orapred ODT for Inﬂammatory Conditions Phenoptin for PKU 6R-BH4 for Cardiovascular Indications Phenylase for PKU BIOMARIN:MATCHING PR OVEN SCIEN CE WIT H PROV EN N EE DS On May 31, 2005, the U.S. Food and Drug Administration (FDA) approved NaglazymeTM (galsulfase), the ﬁrst enzyme replacement therapy for the treatment of mucopolysacchari- dosis VI (MPS VI). This was the second time in BioMarin’s eight-year history that the company successfully advanced a product through the clinic and into the marketplace. At BioMarin, we are committed to developing and com- mercializing innovative biopharmaceuticals for serious diseases and medical conditions. We are aggressive in this undertaking and seek product opportunities that suggest a clear development path, provide an opportunity to be ﬁrst to market and, most importantly, will address unmet medical needs. , y t i l i c a f g n i r u t c a f u n a m t r a - e h t - f o - e t a t s a , s t c u d o r p d e v o r p p a o w T w e n d n a , e p o r u E d n a s e t a t S d e t i n U e h t n i s n o i t a r e p o l a c r e m m o c i i . e n i l e p p e h t n i s e i t i n u t r o p p o t c u d o r p S S E R G O R P F O S R A E Y T H G I E d e d n u o F . c n I l a c i t u e c a m r a h P n i r a M o B i 7 9 9 1 A MESSAGE FRO M THE CEO 2005 was a year marked by signiﬁcant growth and success for BioMarin: we increased net product sales of Aldurazyme® (laronidase); we moved Naglazyme through clinical devel- opment to market; we advanced and added to our product pipeline; and we formed a strategic partnership that will help fund our lead clinical programs. We enter 2006 with continued resolve to build a sustainable biopharmaceutical company that will satisfy the interests of our stockholders and address unmet medical needs. Net product sales of Aldurazyme for mucopolysaccharidosis I (MPS I) by BioMarin/Genzyme LLC continued to grow in 2005, increasing 79 percent in comparison to the previous year. In line with this, our share of the proﬁt from this 50/50 joint venture grew to $11.8 million for the year. As we move forward in 2006, we expect to see increasing proﬁts from Aldurazyme as product sales continue to grow and as we reduce research and development-related spending. Net product sales of Naglazyme for MPS VI totaled $6.1 million in 2005. Naglazyme was approved by the FDA on May 31, 2005, and subsequently by the European Commis- sion in late January 2006. We anticipate net product sales of Naglazyme to increase signiﬁcantly in 2006 as more individuals begin receiving commercial treatment in the United States, Europe and other parts of the world. With regard to our product pipeline, in April 2005, we initiated a Phase 3 clinical trial of PhenoptinTM (sapropterin dihydro- chloride) for the treatment of phenylketonuria (PKU). Phenoptin is a synthetic form of 6R-BH4 (commonly known as tetrahydrobiopterin or BH4), an enzyme cofactor that works in combination with the enzyme needed to metabolize Leadership team from left to right: Jean-Jacques Bienaimé Chief Executive Ofﬁcer Emil Kakkis, M.D., Ph.D. Chief Medical Ofﬁcer Jeffrey Cooper Vice President Chief Financial Ofﬁcer Robert Bafﬁ, Ph.D. Senior Vice President Technical Operations G. Eric Davis Vice President General Counsel & Secretary Stephen Aselage Senior Vice President Global Commercial Operations Stuart Swiedler, M.D., Ph.D. Senior Vice President Clinical Affairs 1 I S P M r o f e m y z a r u d l A f o l a i r T l a c n i l i C 1 e s a h P s e t a i t i n I n i r a M o B i 7 9 9 1 d n a t n e m p o l e v e D e h t t r o p p u S o t d e m r o F C L L e m y z n e G / n i r a M o B i I S P M r o f e m y z a r u d l A f o n o i t a z i l a c r e m m o C i - a z i l a i c r e m m o c d n a t n e m p o l e v e d e h t h t i w d e t a i c o s s a s t ﬁ o r p d n a s t s o c e m y z n e G d n a t c u d o r p e h t s e r u t c a f u n a m n i r a M o B i . e m y z a r u d l A f o n o i t l l a e r a h s e m y z n e G d n a n i r a M o B i , e r u t n e v t n o i j 0 5 / 0 5 i s h t o t t n a u s r u P . t i s e z i l a i c r e m m o c 8 9 9 1 y n a p m o C d e d a r T y l c i l b u P a s e m o c e B n i r a M o B i ) N R M B : X W S / Q A D S A N ( 9 9 9 1 phenylalanine (Phe). We announced positive results from this trial in March 2006 that demonstrated a highly statistically signiﬁcant reduction in blood Phe levels (p‹0.0001) following six weeks of treatment with Phenoptin versus placebo. This was the primary endpoint of the trial. Phenoptin was well tolerated and the type and incidence of adverse events was similar in the Phenoptin and placebo groups. We remain on-track to ﬁle a New Drug Application (NDA) in early 2007. Phenoptin has been designated an orphan drug in the United States and Europe and assigned Fast Track status in the United States. We are developing Phenoptin in collaboration with Serono, our corporate partner as of May 2005, which will equally share Phase 3 development costs in exchange for rights to market Phenoptin outside of the United States and Japan. In May 2005, we licensed expanded intellectual property rights to 6R-BH4 for cardiovascular indications—an investigational product candidate that could provide us with an opportunity to break into markets with substantial commercial potential. In addition to the possible application of 6R-BH4 in treating PKU, researchers have established that a deﬁciency of 6R-BH4 contributes to endothelial dysfunction and, in academic studies, they have demon- strated that administration of 6R-BH4 improves vascular endothelial function in animal models and individuals with diabetes and cardiovascular disease. In 2006, we plan to initiate two Phase 2 clinical trials of 6R-BH4, beginning with one in poorly controlled hypertension. Our 6R-BH4 program provides us with the opportunity to expand beyond orphan drug markets into new markets that may offer substantial commercial potential. 2 I V S P M r o f e m y z a l g a N f o l a i r T l a c n i l i C 2 / 1 e s a h P s e t a i t i n I n i r a M o B i 0 0 0 2 s e t a t S d e t i n U e h t n i d e h c n u a L d n a d e v o r p p A I S P M r o f e m y z a r u d l A e p o r u E d n a 3 0 0 2 n i t p o n e h P r o f n o i t a c i l p p A g u r D w e N l a n o i t a g i t s e v n I s e l i F n i r a M o B i U K P r o f 4 0 0 2 We are excited about what we have accomplished in 2005 and the opportunities that are ahead of us. The key to our continued success lies in our ability to strike a balance between improving our financial performance and investing in new product opportunities. To this end, we remain focused on accelerating the growth and proﬁtability of Naglazyme and Aldurazyme, leveraging our manufac- turing and commercial infrastructure, and identifying new opportunities that will help to further strengthen our company. I would like to extend my sincere appreciation to our board of directors and our scientiﬁc advisory boards, especially those formed to guide our PKU and cardiovascular programs, for sharing with us their leadership and scientiﬁc expertise. To our employees, I gratefully acknowledge their hard work and dedication toward meeting our aggressive corporate goals and making new therapies a reality. Finally, I extend my appreciation to our stockholders for placing their conﬁdence in us at BioMarin and for investing in our future. The key to our continued success lies in our ability to strike a balance between improving our ﬁnancial performance and investing in new product opportunities. Sincerely, Jean-Jacques Bienaimé Chief Executive Ofﬁcer 3 e h t n i e m y z a l g a N r o f s n o i t a c i l p p A g n i t e k r a M s e l i F n i r a M o B i e p o r u E d n a s e t a t S d e t i n U ) n e p o ( 9 3 . 6 $ 5 0 / 3 / 1 4 0 0 2 n o i l l i m 7 . 3 $ 5 0 4 . Q U K P r o f n i t p o n e h P f o l a i r T l a c n i l i C 2 e s a h P s e t a i t i n I n i r a M o B i 4 0 0 2 5 0 y r a u n a J 5 0 h c r a M 5 0 e n u J 5 0 r e b m e t p e S n o i l l i m 6 . 2 4 $ 4 0 0 2 n o i l l i m 5 . 1 1 $ 3 0 0 2 n o i l l i m 4 . 6 7 $ 5 0 0 2 n o i l l i m 3 . 2 $ 5 0 3 . Q n o i l l i m 1 . 0 $ 5 0 2 . Q AL DURAZYME NET PRODU CT S AL ES NAGLAZYME NET PRODUCT SALES 2005 S TOCK C HAR T As recorded by BioMarin/Genzyme LLC. All proﬁts/losses are shared equally between BioMarin and Genzyme Corporation. Aldurazyme was approved in the United States and Europe in April and June 2003, respectively. Naglazyme was approved in the United States and Europe in May 2005 and January 2006, respectively. 2005 sales: $6.1 million ) e s o l c ( 8 7 . 0 1 $ 5 0 / 0 3 / 2 1 5 0 r e b m e c e D BMRN ˆNBI 4 U K P r o f n i t p o n e h P f o l a i r T l a c n i l i C 3 e s a h P s e t a i t i n I n i r a M o B i 5 0 0 2 5 0 0 2 - s a v o d r a C i f o t n e m t a e r T e h t r o f 4 H B - R 6 o t i s t h g R s e r i u q c A n i r a M o B i s n o i t a c d n i I r a l u c 5 0 0 2 t n e m p o l e v e D e h t r o f o n o r e S h t i w e c n a i l l i A c g e t a r t S s m r o F n i r a M o B i r o f 4 H B - R 6 d n a e s a l y n e h P , n i t p o n e h P i f o n o i t a z i l a c r e m m o C d n a s n o i t a c d n i I r a l u c s a v o d r a C i d n a U K P s ’ n i r a M o B i f o t n e m p o l e v e d e g a t s - e t a l d n u f s p l e h t n e m e e r g a s h T i t n e m t a e r t e h t r o f 4 H B - R 6 d n a U K P r o f e s a l y n e h P d n a n i t p o n e h P f o s t s o c t n e m o t p u n i r a M o B e d i v o r p l l i i w o n o r e S , y l l a n o i t i d d A . s n o i t a c d n i i r a l u c s a v o d r a c i f o i n o i t a z i l a c r e m m o c . . S U - x e r o f e g n a h c x e n i s t n e m y a p e n o t s e l i m n i n o i l l i m 2 3 2 $ . ) n a p a J g n d u l c x e ( i s t h g i r 5 0 0 2 s e t a t S d e t i n U e h t n i d e h c n u a L d n a d e v o r p p A I V S P M r o f e m y z a l g a N t c u d o r p t s r ﬁ s t i d e c n e m m o c n i r a M o B i , l a v o r p p a r e t f a s y a d 0 3 n a h t s s e L - p o l e v e d 3 e s a h P e r a h s y l l a u q e l l i w o n o r e S d n a n i r a M o B i . s m a r g o r p 4 H B - R 6 y l l u f a o t n i h t w o r g s ’ y n a p m o c e h t n i t n e v e t n a c ﬁ n g s i i i a g n k r a m , h c n u a l . y n a p m o c l a c i t u e c a m r a h p o b d e t a r g e t n i i IMPROVING FINA N CIA L PR OF IL E For the third year in a row, net product sales of Aldurazyme through BioMarin/Genzyme LLC increased substantially in comparison to the previous year. This continued growth led the joint venture to proﬁtability in 2005—a ﬁrst since the partnership was formed. We expect net product sales of Aldurazyme to continue to increase in 2006. Within three weeks of approval, we launched Naglazyme in the United States and, before it was approved in Europe, we were selling it on a named–patient basis. Each quarter we transitioned more individuals onto commercial therapy, resulting in $6.1 million of net product sales for 2005. Commercializing Naglazyme on our own in both the United States and Europe positions us to realize a proﬁt from the product more quickly than had we outsourced it to a third party. We expect net product sales of Naglazyme to continue to grow in 2006 as it is approved in additional countries and more individuals begin treatment. The partnership we formed with Serono in May 2005 helped us to advance Phenoptin into Phase 3 development and contributed to our decrease in net loss in 2005 in comparison to the previous year. In 2005, pursuant to our agreement, we received a $25 million upfront payment and equally shared Phase 3 development costs associated with Phenoptin. Looking ahead, we expect this partnership to continue to help us advance our PKU and cardiovascular programs and support our effort to reduce our net cash use. In 2005, our stock price increased over 68 percent—a reﬂection of the progress we made throughout the year. 5 T D O d e r p a r O r o f n o i t a c i l p p A g u r D w e N s e l i F n i r a M o B i 5 0 0 2 d e h s i l b a t s E . d t L e p o r u E n i r a M o B i 6 0 0 2 e p o r u E n i d e v o r p p A I V S P M r o f e m y z a l g a N 6 0 0 2 PRO DUCTS ON THE MARKET AL DURA ZYME FOR MPS I NAGLAZYME FOR MP S V I Aldurazyme is now available in over 30 countries worldwide and remains the only drug therapy for the treatment of MPS I. MPS I is a progressive, life-threatening genetic dis- ease characterized by a deﬁciency of alpha-L-iduronidase, a lysosomal enzyme. Aldurazyme is an enzyme replacement therapy that provides MPS I patients with a recombinant version of this enzyme. Today over 400 individuals are receiving treatment with Aldurazyme, and we expect this number to increase as more patients are identiﬁed and approvals are attained in additional countries. We developed Aldurazyme in partnership with Genzyme and received FDA approval in just over ﬁve and a half years after ﬁling the Investigational New Drug Application (IND). Aldurazyme is manufactured by BioMarin and commercialized by Genzyme. Naglazyme is the ﬁrst enzyme replacement therapy for the treatment of MPS VI. Similar to MPS I, MPS VI is a progres- sive, life-threatening genetic disease characterized by a deﬁciency of a lysosomal enzyme. Naglazyme provides patients with a recombinant version of this enzyme, arylsulfatase B. We believe that early diagnosis is crucial to preventing irreversible multisystemic damage caused by MPS VI. To this end, we are working to educate pediatri- cians about the signs and symptoms of the disease so that individuals can be promptly referred to genetic specialists for diagnosis and treatment. We independently developed Naglazyme and received FDA approval in just over ﬁve years after ﬁling the IND. Naglazyme is manufactured and commercialized by BioMarin. Regulatory authorities in the United States and Europe have granted Aldurazyme for MPS I and Naglazyme for MPS VI orphan drug status, confer- ring seven years of market exclusivity in the United States and 10 years in the European Union. 6 8 y l r o o P n i 4 H B - R 6 f o l a i r T l a c n i l i C 2 e s a h P e t a i t i n I o t n i r a M o B i i n o s n e t r e p y H d e l l o r t n o C S E N O T S E L I M D E T C E J O R P 6 0 0 2 3 – 2 r e t r a u Q PRO DUCTS IN DEV ELOPMEN T PHENOPTI N FOR PKU 6R- BH4 FOR CARD IOVAS CU LAR IND ICATI ON S Phenoptin is an investigational small–molecule oral thera- peutic for the treatment of PKU. The active ingredient in Phenoptin is a synthetic form of 6R-BH4, an enzyme cofac- tor that plays a key role in metabolizing phenylalanine (Phe). Phe is found in most protein-containing foods and if not sufﬁciently metabolized, it accumulates in the blood. Sustained elevated blood Phe levels can lead to serious neurological complications, including mental illness, loss of IQ and cognitive problems. We are developing Phenoptin with the aim of providing BH4-responsive phenylketonurics with a simple and effective way to manage their disease. Currently, the only way to manage PKU is through a restricted diet that is difﬁcult for most to adhere to. We plan to ﬁle an NDA in early 2007. 6R-BH4 is an investigational small–molecule oral therapeutic for the treatment of cardiovascular indications. In addi- tion to playing a role in metabolizing Phe, BH4 is required for the production of nitric oxide in the endothelium. Researchers have established that a deficiency of BH4 contributes to endothelial dysfunction and, in academic studies, have demonstrated that administration of 6R-BH4 improves vascular endothelial function in animal models and individuals with diabetes and cardiovascular disease. In 2006, we plan to initiate a Phase 2 clinical trial of 6R-BH4 in poorly controlled hypertension followed by a Phase 2 clinical trial in a second indication with endothelial dys- function. Additionally, we expect two investigator-sponsored studies to be initiated in 2006, one in pulmonary arterial hypertension and the other in coronary artery disease. 6R-BH4, commonly known as tetra- hydrobiopterin (BH4), is a naturally occurring enzyme cofactor. BioMarin is evaluating its application in treating PKU as well as endothelial dysfunction seen in diabetes and cardiovascular indications. U K P r o f n i t p o n e h P r o f n o i t a c i l p p A g u r D w e N e l i F o t n i r a M o B i 7 0 0 2 y l r a E 7 This Annual Report contains ‘forward-looking statements’ as deﬁned under securities laws. These statements can generally be identiﬁed by the use of terminology such as ‘believes’, ‘expects’, ‘anticipates’, ‘plans’, ‘intends’, ‘may’, ‘will’, ‘projects’, ‘continues’, ‘estimates’, ‘potential’, ‘opportunity’, and so on. Our actual results or experience could differ signiﬁcantly from the forward-looking statement. Factors that could cause or contribute to these differences include the results of our current clinical trials, our ability to obtain regulatory approval for our product candidates, our ability to successfully market our products and the other factors discussed in the enclosed Form 10-K and the section entitled ‘Risk Factors’ therein. You should not place undue inﬂuence on these forward- looking statements which speak only as of the date that they were made. These cautionary statements should be considered in connection with any written or oral forward- looking statements that we may issue in the future. We do not undertake any obligation to release publicly any revisions to these forward-looking statements after completion of the distribution of this Annual Report to reﬂect later events or circumstances or to reﬂect the occurrence of unanticipated events. Aldurazyme is a registered trademark of BioMarin/Genzyme LLC. We strengthened our management team in 2005, adding key individuals to support the continued growth of our commercial and manufacturing operations. EXECUTIVES Jean-Jacques Bienaimé Chief Executive Ofﬁcer Emil Kakkis, M.D., Ph.D. Chief Medical Ofﬁcer Jeffrey Cooper Vice President Chief Financial Ofﬁcer Stephen Aselage Senior Vice President Global Commercial Operations Jeff Ajer Vice President Sales & Marketing Operations William Aliski Vice President & General Manager European Operations Robert Bafﬁ, Ph.D. Senior Vice President Technical Operations G. Eric Davis Vice President General Counsel & Secretary Steven Jungles Vice President Supply Chain Daniel Maher Vice President Product Development Victoria Sluzky, Ph.D. Vice President Quality & Analytical Chemistry Stuart Swiedler, M.D., Ph.D. Senior Vice President Clinical Affairs Amy Waterhouse Vice President Regulatory & Government Affairs 8 Jean-Jacques Bienaimé Chief Executive Ofﬁcer Emil Kakkis, M.D., Ph.D. Chief Medical Ofﬁcer Jeffrey Cooper Vice President Chief Financial Ofﬁcer Stephen Aselage Senior Vice President Global Commercial Operations Jeff Ajer Vice President Sales & Marketing Operations William Aliski Vice President & General Manager European Operations Robert Bafﬁ, Ph.D. Senior Vice President Technical Operations G. Eric Davis Vice President Steven Jungles Vice President Supply Chain General Counsel & Secretary Daniel Maher Vice President Product Development Victoria Sluzky, Ph.D. Vice President Quality & Analytical Chemistry Stuart Swiedler, M.D., Ph.D. Senior Vice President Clinical Affairs Amy Waterhouse Vice President Regulatory & Government Affairs BOA RD OF DIRE CTORS Jean-Jacques Bienaimé Chief Executive Ofﬁcer BioMarin Pharmaceutical Inc. Joseph Klein, III Managing Director Gauss Capital Advisors, LLC Franz Cristiani Retired Partner Arthur Andersen LLP Pierre Lapalme Former President & Chief Executive Ofﬁcer North America Ethypharm, Inc. Michael Grey President & Chief Executive Ofﬁcer SGX Pharmaceuticals, Inc. Alan Lewis, Ph.D. President & Chief Executive Ofﬁcer Novocell, Inc. Elaine Heron, Ph.D. Chairman & Chief Executive Ofﬁcer Labcyte Inc. Stock Listing Corporate Headquarters BioMarin Pharmaceutical Inc. is listed on the Nasdaq National Market and the SWX Swiss Exchange under the symbol BMRN. Transfer Agent Mellon Investor Services 85 Challenger Road Ridgeﬁeld Park, NJ 07660 T: 800.356.2017 (Domestic) 201.329.8660 (International) BioMarin Pharmaceutical Inc. 105 Digital Drive Novato, CA 94949 Tel: 415.506.6700 Fax: 415.382.7889 E-mail: ir@bmrn.com www.BMRN.com ��

Continue reading text version or see original annual report in PDF format above