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Business Development And Its Information Needs JJ Owen, AVEO Pharmaceuticals Bob Bennett, Merrimack Pharmaceuticals March 2007.

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Presentation on theme: "Business Development And Its Information Needs JJ Owen, AVEO Pharmaceuticals Bob Bennett, Merrimack Pharmaceuticals March 2007."— Presentation transcript:

1 Business Development And Its Information Needs JJ Owen, AVEO Pharmaceuticals Bob Bennett, Merrimack Pharmaceuticals March 2007

2 Agenda Introduction – Our Background Business Development Who and What do they do? Case Study: In-licensing Outputs and Sources Creating Value: Beyond the Sources

3 Our Background JJ OwenBob Bennett Years in Industry79 EducationPh.D. BiologyM.S. Chemistry M.B.A. Work ExperienceCell Biologist Proteome/Incyte Knowledge Mgmt Sci & Comp Analysis Bus Dev Organic Chemist Sci & Comp Analysis Bus Dev CompanyAVEO PharmaceuticalsMerrimack Pharmaceuticals PositionBusiness Development Size of Company8060 Size of Bus Dev33

4 Who is Business Development? Small organization Mostly MBA trained (some with science backgrounds) Typically marketing or finance backgrounds Prior background - consultants Intimately aware of several data sources Unaware of a large majority Time crunched deadlines is the norm Attention span of a gnat Job focus & data source needs constantly changing

5 Business Development – What do they do? Traditional activities Non-traditional activities Mergers & Acquisitions Licensing Activity Competitive Landscape Financials Market Analysis Deal Negotiation Public Relations Technical Writing Competitive Intelligence Project Managemen t

6 Case Study – In-licensing

7 In-licensing has been described as… …Finding a needle in a haystack

8 In-licensing: Process Flow Tracking database Finding Leads Conferences Connections Secondary Sources Primary Sources Target Sweeps Making the Case Company Profiles Key Personnel Pipeline snapshot Financials Deals Competitor Pipelines Clinical Trial Data Commercial Profile Market Data Pursue Opportunity

9 Case Study – In-licensing Finding Leads

10 Attend conferences AACR, ASCO, CHI, SRI, EORTC, many, many others Connections Who do you know? Secondary Sources Thomson Pharma, BioCentury, BioWorld, NewsFeeds, WWW Primary Sources Investors, SAB, BOD, Consultants

11 Target Sweeps CompanyDrugHighest Dev. Status ASTA Medica AG perifosine Phase 2 Clinical NovartisAEE-788 Phase 1 Clinical RexahnRX-0201 Phase 1 Clinical Abbott Laboratories AKT kinase inhibitors, Abbott Discovery AEterna Zentaris Inc erucylphosphocholine Discovery Amphora DiscoveryAkt1 inhibitors, Amphora Discovery Berlex Biosciences BX-424 Discovery Bristol-Myers SquibbBMS Discovery Cellular GenomicsAkt-1 inhibitors, Cellular Genomics Discovery Consensus Pharmaceuticalsanticancer agents, Consensus Discovery Institute of Cancer Research UK PKB inhibitors, Astex/ ICR/ Cancer Research UK Discovery Kinetek Pharmaceuticalsprotein kinase B (PKB/Akt) inhibitors, Kinetek Discovery MerckAkt protein kinase inhibitors, Merck & Co Discovery National Cancer Institute azoacridone anticancer agents, NCI Discovery National Cancer Institute EM-12 Discovery National Cancer Institute RTA-502 Discovery NeoGenesis PharmaceuticalsAkt-1 inhibitors (cancer), NeoGenesis Discovery Nerviano Medical SciencesAkt kinase inhibitors (cancer), Nerviano Discovery Sources Thomson Pharma, Company Websites, Newsfeeds Akt inhibitors

12 Case Study – In-licensing Making the Case

13 Company Profiles - MGI Pharma Overview Headquarters: Bloomington, MN, Lexington, MA (MGI Biologics) Therapeutic Focus: Entities (small molecule or Biologics) for cancer treatment and supportive care Technology: BIOTOPE (targeted plasmid system) and GENCAP (DNA protection) Strategy: Acquisition of clinical stage development compounds Investors: Publicly traded on NASDAQ (MOGN) Cash Position: $205.5M Market Cap: $1.65 B ($1.65 B Enterprise Value) Employees: 282 Recent News 4/05: MGI PHARMA Reports First Quarter Results 1/05: Dacogen NDA filing for MDS accepted by FDA 12/04: Dacogen P3 trial results in MDS reported at ASH 10/04: Dacogen MAA filing for MDS accepted by EMEA 9/04: Begins promotion of Kadian to oncologists 9/04: Acquires WW marketing rights for Dacogen from SuperGen 9/04: Acquires Zycos for $50 M in cash 9/04: Acquires Aesgen for $90 M in cash 7/04: Kadian marketing agreement for oncology market with Alpharma Pipeline --Aloxi (licensed NA rights from Helsinn SA) --Salagen (retains NA marketing rights) --Hexalen (retains WW rights) --Dacogen (Decitabine) (acquired WW rights from SuperGen) Small molecule, DNA methyltransferase inhibitor P3 mono, MDS, 170 pts: RR 17% vs. 0% for supportive care P2 mono, Gleevec ref. CML, 27 pts: 17 hema. response --Irofulven (retains WW rights) Small molecule acylfulvene, breaks DNA strands P2 mono, rel/ref Ovarian, 55 pts: 1 CR, 9 PR P3 mono, ref Pancreatic: OS inferior to 5-FU P2 with ERCC3 gene deficient pts underway P2 mono, liver, 48 pts: 2 PR, 18 SD --Saforis (retains WW rights), Phase III, mucositis --ZYC101a (acquired in purchase of ZYCOS ) Antibody, completed Phase II, 161 pts, RR 43% vs. 27%, drug was well tolerated --ZYC300 (acquired in purchase of ZYCOS) Antibody, completed Phase I/II, 17 pts, ASCO 2003, drug was well tolerated and biologically active --MG98 (licensed NA rights from Methylgene) Antisense oligonucleotide, inhibits DNA methyltransferase-1 P2 RCC, IFN combo: Initiated 10/04 Partnering Rationale Potential collaboration partner with our discovery platform and their therapeutic Antibody program Aggressive late stage up and coming Oncology development company with cash and solid market cap Sources --Thomson Pharma, Recap, Company website, Yahoo Finance, SEC

14 MGI Pharma Key Officers Leon O. Moulder, President and CEO Prev at Eligix, Inc., Hoechst Marion Roussel (now Aventis), Marion Laboratories, and Marion Merrell Dow. James C. Hawley, SVP, CFORecently joined MGI Pharma, Prev. CFO and corporate secretary at CIMA LABS, principal with Manchester Companies, Inc., and Orthomet Michael T. Cullen, CMOPrev at Searle/Pharmacia Martin J. Duvall, SVP, Commercial Operations Prev 18 yrs at Aventis Mary Lynne Hedley, SVP, MGI Pharma Biologics Cofounder of ZYCOS, Inc. and most recently served as president and chief executive officer PersonnelFinancials Income Statement (12/31/2004) Revenues $195.7 M COGS 60.0 M R&D Expense 62.6 M SG&A Expense 73.8 M Acq. R&D Expense 83.1 M Operating Income (84.7 M) Interest Income 5.3 M Interest Expense (6.0 M) EBT (85.4 M) Balance Sheet (12/31/04) Assets: Cash and Equivalents205.5 M Accounts Receivable122.3 M Inventories 8.4 M Other Current Assets 5.8 M LT Investments 75.4 M Property, Plant and Equipment 2.7 M Intangible Assets 8.0 M Total Assets436.3 M Liabilities: Current Liabilities 58.8 M Long Term Debt260.2 M Other Liabilities 2.8 M Total Liabilities321.8 M Shareholders Equity: Net Shareholders Equity114.5 M Total Liabilities and SH Equity436.3 M Board of Directors Andrew J. FerraraPresident and CEO of Boston Healthcare, managing partner of Boston BioLicensing, L.L.C. Gilla KaplanCurrent head of the Laboratory of Mycobacterial Immunity and Pathogenesis, The Public Health Research Institute, Newark, NJ. Edward W. MehrerCFO of CyDex, a drug delivery company. Board member and audit committee chair of Novastar Financial Hugh E. MillerChairman, retired from ICI after a 22-year career Lonnie MoulderSee profile above Lee SchroederPresident and director of Lee Schroeder & Associates, Inc. David B. SharrockDirector of Interneuron Pharmaceuticals Inc., Praecis Pharmaceuticals, Incara, Broadway, and The Ohio State University Foundation Waneta C. TuttleCEO, Southwest Medical Ventures, and CEO, Exagen Diagnostics, Inc. Arthur L. WeaverLeading rheumatologist, serves as medical director of Arthritis Center of Nebraska

15 MGI Pharma Deals 9/04: Acquires privately held Zycos for $50 M in cash Acquires expertise in immunology and development of biologics See Pipeline for clinical data 9/04: Acquires privately held Aesgen for $32 M in cash Pays $32 M upfront, milestones of $33 M for approval and $25 M if annual sales exceed $50 M plus royalty of 5% Acquires Saforis, a P3 compound for oral mucositis 9/04: Licenses WW rights to Dacogen from SuperGen P3 completed in MDS with an NDA expected 4Q04 Possible expansion into AML, CLL and solid tumor Pays $40 M equity investment, up to $45 M in milestones, at least $15 M in development costs and royalty from % 7/04: Kadian marketing agreement with Alpharma Kadian is a sustained release morphine marketed for pain relief 3 yr agreement for MGI to market Kadian to oncologists Undisclosed profit sharing agreement 4/01: Licenses NA commercialization rights for Aloxi from Helsinn Aloxi is a P3 product for chemotherapy induced nausea and vomiting Pays $11 M upfront, undisclosed milestones and royalties Helsinn funds development and responsible for manufacturing 4/03: Collaboration expanded to include post-operative nausea and vomiting indication and an oral formulation Pays $22.5 M upfront and up to $25 M in milestones 1/01: US marketing rights for Mylocel from Barr Labs Mylocel (hydroxyurea) marketed for melanoma, CML and ovarian cancer Barr receives undisclosed royalties

16 Competitive Landscape: Late Stage Breast Cancer Targeted Therapies DrugMOACurrent Phase Latest Breast Cancer Trial DataExpected Filing Date Lapatinib (GW2016) Inhibits EGFR and Her2 Phase IIIPhase III combination trials, Lapatinib with: Capcitebine, first line metastatic, on-going Paclitaxel, first line metastatic, on-going Letrozole, first line metastatic, hormone eligible patients, on-going, interim analysis – 35% RR Late 2006 Early 2007 AvastinVEGF inhibitorPhase IIIPhase III trial for an Avastin-Capcitebine combination failed to meet primary endpoint Phase III trial in comb w Paclitaxel, 700 pts, first line metastatic, 28% RR vs 14%, PFS 10.9 mo vs mo Late 2006 Early 2007 ABX-EGFRHer2 antibodyPhase IIPhase II trials in solid tumors indicates solid data in several tumor types. Amgen/Abgenix appears to be targeting Colorectal cancer Not applicable Omnitarg (pertuzumab) Her2 antibodyPhase IIInterim data from ASCO, open-label randomized trial, 79 patients, 2 cohorts, 2 PR, 32 SD Not Applicable Sources --Thomson Pharma, ASCO abstracts, DataMonitor

17 Market Analysis: Breast Cancer Epidemiology and Current Treatment Paradigm, 2004 IncidencePrevalenceMortality 1 yr survival 5 yr survival 412,894 2,714,400121, % 86.5% Current Treatment Paradigm Early Stage Late Stage Surgery Adjuvant Therapy* Hormonal TherapyChemotherapy TamoxifenAC (doxorubicin + cyclophosphamide) ArimidexCMF (cyclophosphamide + methotrexate + fluoracil) *depends on hormone receptor and menopausal status Options dependent on status Chemotherapy -Paclitaxel and Docetaxel Hormonal Therapy -Tamoxifen or Arimidex Targeted Therapy -Herceptin (Her2+ only, 25% of patients) Sources --DataMonitor, WWW, GloboCan, American Cancer society, NCI

18 Business Development Sources Extremely limited resources, always looking for the best bang for your buck Choice of source is critical when one has money Public sources, public sources, public sources Current Gaps Sales projections Analyst reports Clinical trial data Deal details


20 I Know How To Search For Information!

21 Of Course, You Know Better

22 Perception vs. Reality

23 Does Information Flow Freely? DemandSupply

24 How Is Information & Analysis Delivered In Your Organization? Newsletters Literature Alerts Conference Reports Interactions with individuals Membership on project teams On-line requests Journal subscriptions Department webpage Provide access to databases

25 Value Is Created In Each Step Of The Process Greater breadth of information sources Access Timeliness Subject Knowledge Delivery Rapid access to information through knowledge, effective searching, and alerts Cut through the noise, recognize critical info, provide analysis, deliver exec summaries Multitude of delivery mechanisms Reduce time to customer

26 How Would An Information Professional Assist Bus Dev? Added Knowledge Sources, limitations, and effective use Focused Data Quality, accuracy, completeness, analysis Efficient Use Of Time Division of labor Assist In Budgeting Able to forecast information needs as company matures

27 JJ Owen: AVEO Pharmaceuticals Bob Bennett: Merrimack Pharmaceuticals Thank you

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