Ligand Pharmaceuticals Incorporated · NASDAQ:LGND
Ligand Pharmaceuticals — Investor Day (November 2015)
127 slides from Ligand Pharmaceuticals's investor day presentation, Nov 18, 2015
Slide 1: 2016 and Beyond Analyst Day
2016 and Beyond Analyst Day New York - November 18, 2015 NASDAQ: LGND
Slide 2: Forward-looking statements
The following presentation contains forward-looking statements regarding Ligand’s prospects, plans and strategies, drug development programs and collaborations. Forward-looking statements include financial projections, expectations regarding research and development programs, and other statements in
Slide 3: Today's Agenda
Today’s Agenda 1) Business Overview John Higgins, CEO 2) Portfolio Highlights Matt Foehr, COO 3) GRA Program Eric Vajda, Preclinical R&D 4) Intellectual Property Charles Berkman, General Counsel 5) Viking Therapeutics Overview Brian Lian, CEO, Viking Therapeutics 6) Financial Overview and Outlook Ma
Slide 4: Ligand: 2016 and Beyond
Ligand: 2016 and Beyond • Ligand is a high-growth company with economic rights to some of the world’s most important medicines • “Shots-on-Goal” business model is stronger than ever and projected to continue to drive the business significantly • Cutting-edge innovations with Captisol, LTP and Selexi
Slide 5: Ligand: A Unique Biotech Investment Company
• Ligand focused on building a large portfolio of fully-funded programs (“Shots-on-Goal”) • Two primary business objectives: — Drive R&D to earliest inflection point for partnering — Acquire assets efficiently to further build portfolio • The goal: Above average returns, below average risk — Economi
Slide 6: Major Progress Over Past Two Years
2013 2015 Shots-on-Goal (fully-funded programs) >90 >125 Number of Partners 55 >72 Projected Annual R&D Investment $800 million $1.8 billion Potential Milestones owed to LGND $700 million $2.5 billion Annual Revenue $49 million $75 - $76 million (est) Adjusted EPS $1.02 $3.34- $3.37 (est) Major Prog
Slide 7: Ligand's Business Operations
7 Ligand’s Business Operations Companies Increasingly Moving Toward Operating Virtually 19-person internal team focused on: • Drug research and development • Licensing, acquiring and integrating assets/companies • Partner collaboration services • Two offices: San Diego and Kansas City Supported By:
Slide 8: Ligand's Portfolio Continues to Grow
0 25 50 75 100 125 2008 2015 9 0 2 4 6 8 2008 2015 Fu lly -Fu n d ed Pr o gr ams (“S h o ts -o n -Goa l”) Ligand’s Portfolio Continues to Grow 125 + Ligand’s Achievement: Portfolio Expansion Partners’ Achievement: Approved Products Excellent record as drug researcher, innovator and licensor Our part
Slide 9: Commercial products projected by 2020
24 by 2020 • Over 24 commercial products projected to be generating revenue for Ligand by the end of this decade • These revenue generating assets expected to come from existing portfolio; any future deals would be additive to this outlook 2008 2015 2020 Projected 1 8 > 24 9
Slide 10: Outlook for Potential New Products
• Realistically, not all 125+ products will make it to market considering standard pharma success rates • But, given current program status, here is how new products could enter the market through 2020 Year 2016 2017 2018 2019 2020 Potential New Commercial Products 4 7 15 25 35 Cumulative Potential
Slide 11: Drug development success rates
11 • Drug development success rates have been tracked and published through the years • Nature Reviews Drug Discovery published average rates of success by stage of development as follows: ― 83% probability of success for compounds with a submitted NDA ― 50% probability of success for Phase 3 compou
Slide 12: Ligand: More Diversified Than Ever
12 • Revenue: Significant contribution from each of three sources ― Royalties: Driven by commercial success; Promacta and Kyprolis approved in more indications and countries; more products generating revenue today and more approvals expected annually ― Milestones/License: Driven by regulatory progre
Slide 13: Diverse Capital Allocation
Diverse Capital Allocation Building Asset Base and Increasing Returns for Investors 13 • Over last several years, Ligand has deployed capital in the following ways — Company acquisitions — Royalty acquisitions — Share buybacks — Invested in development of new technology platforms — Invested in biote
Slide 14: Diverse Portfolio Among Drug Companies
Biotech 44% Big Pharma 29% Generic 18% Spec Pharma 10% Over 72 Partners Select Big Pharma Select Biotech Select Spec Pharma Select Generic Diverse Portfolio Among Drug Companies 14
Slide 15: Portfolio Stratification
Extra- Large 7% Large 23% Medium 44% Small 26% Extra-Large (> $70M) Large (>$30 M, <$70M) Medium (>$3M, <$30M) Small (< $3M) Portfolio Stratification Estimated Annual Peak Royalty Revenue Potential • Ligand’s portfolio is very large with over 125 fully funded programs under license — Not all program
Slide 16: Fully-funded Partnerships Driving Growth
• We estimate our licensees will spend over $1.8 billion in 2016 on R&D to advance our programs: — 17 Phase 3 trials — 44 Phase 2 trials — 39 Phase 1 trials — 2 Phase 4 trials — 38 preclinical programs — Manufacturing scale-up — Regulatory filing fees Fully-funded Partnerships Driving Growth 16
Slide 17: Extraordinary R&D Leverage from Licensees
Extraordinary R&D Leverage from Licensees Ligand Cash Expenses $22 M Estimated Licensee Expenditure >$1.8B 2016 Investment in Ligand-based programs 17 $20 million What it was in 2012: $300 million
Slide 18: Ligand's Partners Working in Important Areas
18 Ligand’s Partners Working in Important Areas Orphan Disease and Biosimilars gaining visibility • 8 Orphan Disease programs including near-term market opportunity (SAGE-547) and leader in orphan diseases • 17 Biosimilar programs, more visible with increased regulatory clarity — Coherus’ Etanercept
Slide 19: Ligand's Targeted R&D Model
• Drive R&D to earliest inflection point for partnering • Focus on developing strong inventions and data, generating patents then partnering ― Leverage ripening science and changing medical landscape • Deals generally structured to maximize back-end economics Ligand’s Targeted R&D Model 19
Slide 20: Technology and Novel R&D Drive Deal Making
Technology and Novel R&D Drive Deal Making Potential Launch Platform Technologies Novel R&D LTP Technology™ Glucagon Receptor Antagonist Program for Diabetes Phase 2 planned for 2016 Positive Phase 1b data showing robust effects throughout multiple ascending dosing Solving solubility and stability c
Slide 21: Ligand's Diabetes Drug on Path to Phase 2
Ligand’s Diabetes Drug on Path to Phase 2 2013 2022E $38 B $68 B • Diabetes is one of largest drug markets – Global market projected to grow to $68 billion by 2022, 75% increase in 10 years • Ligand discovered and is developing a potentially major novel treatment • Ligand expects to partner after mo
Slide 22: Top Selling Non-Insulin Anti-Diabetic Drugs
Top Selling Non-Insulin Anti-Diabetic Drugs Significant growth associated with new class launches 22 $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 $ B ill io n s Byetta/Bydureon (AstraZeneca) Januvia (Merck) Galvus (Novartis) Janumet (Merck) Onglyza (AstraZeneca) Victoza ( Novo Nordisk) Invokana (J&J) Forxig
Slide 23: Significant Opportunity for GRA
Class Estimated Peak Sales Potential Potential Drugs in 2020 DPP-IV Inhibitors $12 Billion 5 GLP-1 Agonists $7 Billion 5 SGLT-2 Inhibitors $2 Billion 4 GRA TBD 2 Source: Thompson Reuters, Annual Reports • Branded treatments have multibillion-dollar sales potential • By 2020, existing classes project
Slide 24: Accelerating Projected Revenue Growth
Accelerating Projected Revenue Growth $0 $30 $60 $90 $120 $150 2012 2013 2014 2015 2016 2017 • Growth due to: – New products launched – Growth in existing brands – Higher royalty tiers – Higher Captisol sales – Higher milestones $ M ill io n s 24 Actual Outlook Est.
Slide 25: Revenue Outlook for Two Blockbusters
$0.0 $0.2 $0.4 $0.6 $0.8 $1.0 2016 2017 2018 2019 2020 $ Bi lli o n s $ Bi lli o n s High Low Average 6 NOVN covering analysts reports as of 11/4/15 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 2016 2017 2018 2019 2020 17 AMGN covering analysts reports as of 11/4/15 Revenue Outlook for Two Blockbusters Sell-S
Slide 26: Total Underlying Product Revenue
$0.0 $0.3 $0.5 $0.8 $1.0 $1.3 $1.5 $1.8 $2.0 $2.3 $2.5 2011 2012 2013 2014 2015 2016 2017 26 Total Underlying Product Revenue ($ Billions) • Significant growth in revenue for products Ligand earns royalties on • Total underlying revenue for Ligand’s programs projected to more than double to nearly $
Slide 27: Historical and Projected Operating Expenses
27 Historical and Projected Operating Expenses $0 $10 $20 $30 $40 $50 2012 2013 2014 2015 2016 2017 Cash Operating Expenses Actual Outlook Est. • Annual operating expenses have been flat over recent years • Expense levels projected to remain similar next two years $ Million s
Slide 28: Ligand's Cash Generation is Increasing
28 Ligand’s Cash Generation is Increasing $0 $30 $60 $90 $120 $150 2012 2013 2014 2015 2016 2017 Revenue Cash Expenses Actual Outlook Est. • Strong revenue growth • Operating expense levels projected to remain similar the next two years • Continued significant increase in cash-flow projected $ Mil l
Slide 29: Accelerating Projected Adjusted EPS Growth
Accelerating Projected Adjusted EPS Growth $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 $4.00 $4.50 $5.00 2012 2013 2014 2015 2016 2017 • Adjusted EPS projected to increase from $0.26 in 2012 to over $4.75 in 2017 • Growth due to: – Higher revenues – High gross margins – Low and flat expenses – L
Slide 30: Strong and Expanding Financial Margins
Strong and Expanding Financial Margins Actual 2014 Projected 2016 Gross Margin 86% 90% EBITDA (ex-SBC) Margin 52% 70% Adjusted Profit Margin* 50% 66% *Adjusted to exclude non-cash stock-based comp, CVRs, investments owed to licensors, non-cash debt costs and non-cash taxes 30 Company expects to gene
Slide 31: Major Value Driving Events
Major Value Driving Events Outlook by Year-end 2017 • In addition to the projected financial growth, we have an extraordinary period of news coming up • We expect the next 24 months to be a significant period of major potential events: — BACE Phase 3 data will be released and we’ll know if it is on
Slide 32: Ligand's Portfolio Pyramid
Ligand’s Portfolio Pyramid 32 Major commercial assets EVOMELA (Spectrum) Verubecestat (Merck) SAGE-547 (Sage Therapeutics) Sparsentan (Retrophin) Delafloxacin-IV (Melinta) IRAK-4 (TG Therapeutics) SAR125844 (Sanofi) VK5211 (Viking Therapeutics) VK2809 (Viking Therapeutics) LY2606368 (Lilly) VTX-2337
Slide 33: Commercial Assets - Highlights
Commercial Assets - Highlights
Slide 34: Promacta
Promacta®
Slide 35: Promacta: Blockbuster Commercial Potential
• Oral medicine that boosts platelets • Long patent protection, Orange Book patent expiration in 2027 • Blockbuster commercial potential (>$1 billion) due to growing and large list of potential therapeutic indications, with largest indications in development ITP HCV ORT Idiopathic Thrombocytopenia T
Slide 36: Promacta: Recent Data and Events
• Positive data presented at international meetings this past spring — MDS ‘15: Low to intermediate risk MDS Improved platelet, erythrocyte and neutrophil counts in 64% of patients — ASCO ‘15: Chemotherapy-induced thrombocytopenia Increased platelet counts and reduced dose reductions or delays v
Slide 37: Promacta: Annual Underlying Revenue
$ M illi o n s Net underlying revenue upon which Ligand receives royalties on quarterly lag based on royalty payment structure $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 2010 2011 2012 2013 2014 2015 • Sales have increased over 10x in 5 years from ~$40M to ~$440 • With higher sales, Ligand earns
Slide 38: Promacta Projections: NOVN Sell-Side Analysts
$0 $200 $400 $600 $800 $1,000 2016 2017 2018 2019 2020 Promacta Projections: NOVN Sell-Side Analysts 38 6 NOVN covering analysts reports as of 11/4/15 Values calculated on a one quarter lag These Revenue Projections … …Yield these Royalty Projections $ M ill io n s $ M ill io n s High Low Average $0
Slide 39: Kyprolis
Kyprolis®
Slide 40: Kyprolis Status
• Viewed as best-in-class proteasome inhibitor for multiple myeloma (MM) • Developed and marketed by Amgen Kyprolis Status International comments on ENDEAVOR Data Dr. Meletios A. Dimopoulos University of Athens “The combination of carfilzomib and dexamethasone was superior to bortezomib and dexameth
Slide 41: Kyprolis Recent and Upcoming Events
• Amgen presented positive Phase 3 ENDEAVOR trial data at ASCO 2015 — Demonstrated DOUBLING of median progression-free survival (18.7 vs. 9.4 months) over Velcade in relapsed MM Kyprolis Recent and Upcoming Events • Phase 3 ARROW trial initiated in June comparing once vs. twice weekly Kyprolis dosin
Slide 42: Kyprolis Projections: AMGN Sell-Side Analysts
$0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 2016 2017 2018 2019 2020 Kyprolis Projections: AMGN Sell-Side Analysts 42 17 AMGN covering analysts reports as of 11/4/15 Values calculated on a one quarter lag These Revenue Projections … …Yield these Royalty Projections $ Bi lli o n s $ M ill io n s High Low Aver
Slide 43: DUAVEE
0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 55,000 Q2 Q3 Q4 Q1 Q2 Q2 DUAVEE™ • Best-in-class product for post- menopausal hot flashes and osteoporosis — 70% reduction in vasomotor symptoms — Prevention of bone loss — No increase in breast density/pain — Combo of SERM bazed
Slide 44: Other DUAVEE and Bazedoxifene Updates
Other DUAVEE™ and Bazedoxifene Updates • Preclinical studies have shown bazedoxifene stops the growth of breast cancer cells, even those resistant to tamoxifen or aromatase inhibitors • Bazedoxifene works similarly to the breast cancer drug Faslodex™ (fulvestrant) — However, bazedoxifene has the adv
Slide 45: Portfolio Highlights
Portfolio Highlights Matt Foehr
Slide 46: Ligand's Portfolio Pyramid
Ligand’s Portfolio Pyramid 46 Major commercial assets EVOMELA (Spectrum) Verubecestat (Merck) SAGE-547 (Sage Therapeutics) Sparsentan (Retrophin) Delafloxacin-IV (Melinta) IRAK-4 (TG Therapeutics) SAR125844 (Sanofi) VK5211 (Viking Therapeutics) VK2809 (Viking Therapeutics) LY2606368 (Lilly) VTX-2337
Slide 47: The Big 6: Major Pipeline Assets
Partner Program (Therapy Area) Stage Royalty Rate Potential 2016 Events EVOMELA (Oncology) NDA 20.0% NDA Approval Delafloxacin IV (Infection) Phase 3 2.5% NDA Submission/Action SAGE-547 (Neurology) Phase 3 3.0% Phase 3 Enrollment in SRSE Phase 2 Data in PPD Sparsentan (FSGS - Kidney Disease) Phase 2
Slide 48: EVOMELA
EVOMELA (Spectrum Pharmaceuticals’ CE-Melphalan Program)
Slide 49: EVOMELA Update
EVOMELA Update 49 • Captisol-enabled formulation of melphalan - chemotherapy drug used for stem cell transplant conditioning in multiple myeloma ‒ Stem cell transplant used throughout treatment continuum ‒ Use of Captisol technology increases stability of the product, potentially enabling clinicians
Slide 50: Verubecestat
Verubecestat (Merck’s BACE Inhibitor Program for Alzheimer’s)
Slide 51: Alzheimer's Disease Background
Alzheimer’s Disease Background • Alzheimer’s disease is the 6th leading cause of death in the U.S. — Currently, the only top 10 cause of death that can’t be prevented, cured or slowed • Alzheimer’s is a growing unmet medical need and huge market — 30 million affected worldwide, estimated to be >100
Slide 52: Alzheimer's Therapy Background
Alzheimer’s Therapy Background • Amyloid-β Hypothesis: Leading theory supported by genetic data and some recent clinical results — Significant clinical development focused on mechanism — Antibodies targeting amyloid-β proteins: most advanced in clinic, promising results in selected patient groups, b
Slide 53: Amyloid Beta Theory and Related Targets
Amyloid Beta Theory and Related Targets BACE1 (initial and rate-limiting step) γ-secretase Cell membrane Small molecule BACE1 inhibitors Biologic antibodies Amyloid precursor protein (APP) Self-propagating amyloid protein aggregates lead to AD 53
Slide 54: Verubecestat
Verubecestat • Verubecestat is the first BACE1 inhibitor demonstrated to lower β-amyloid in the cerebral spinal fluid of people with Alzheimer’s • Two Phase 3 trials underway to assess the safety and efficacy in patients with Alzheimer’s disease • Merck has the leading position in the BACE-inhibitio
Slide 55: The Next
The Next 12
Slide 56: The Next 12
The Next 12 • Twelve additional pipeline programs continue to expand the breadth and diversity of Ligand’s growing portfolio 56 • Diverse partners and therapy areas • Diversity of underlying technology — 7 Captisol-enabled programs (C) — 3 New Chemical Entity programs (NCE) — 2 Selexis programs (S)
Slide 57: The Next 12 - Oncology
Program: SAR125844 (Phase 2) • Captisol-enabled, novel selective MET kinase inhibitor • Clinical data has shown early evidence of anti-tumor activity in advanced/refractory solid tumors – Trials ongoing in NSCLC and Advanced Solid Tumors • Additional solid tumor data expected in 2017 57 The Next 12
Slide 58: The Next 12 - Oncology
Program: Prexasertib/LY2606368 (Phase 2) • Captisol-enabled Chk1/2 Inhibitor • Preferentially binds to and inhibits Chk1, a global regulator of cell cycle, and also inhibits Chk2 – Multiple trials ongoing in variety of cancers • Trial completions in 2016, 2017 and 2018 58 The Next 12 - Oncology Broa
Slide 59: The Next - Oncology
The Next 12 - Oncology Broad Base of Partnerships Continues to Advance Program: Pevonedistat/MLN-4924 (Phase 1) • Captisol-enabled first-in-class NEDD8 activating enzyme inhibitor • Being investigated clinically for various hematologic malignancies and solid tumors • Three cancer trials expected to
Slide 60: The Next 12 - Metabolic
Program: SARM/VK5211 (Phase 2) • Novel, potentially best-in-class Selective Androgen Receptor Modulator (SARM) – Retains beneficial properties of androgens without undesired side-effects • Phase 2 trial in hip fracture to complete in 2016 60 Program: Lasofoxifene (Pre-NDA) • Novel third-generation n
Slide 61: The Next 12 - Metabolic and Cardiovascular
61 Program: TR-β/VK2809 (Phase 2) • Selective Thyroid Receptor beta (TR-β) Agonist – Applicability in multiple indications, including hypercholesterolemia, dyslipidemia, NASH, X-ALD, others • Entering Phase 2 for hypercholesterolemia and fatty liver disease • Phase 2 trial to complete in 2016 The Ne
Slide 62: The Next - Inflammation and Biosimilars
Potential Launch 62 The Next 12 - Inflammation and Biosimilars Broad Base of Partnerships Continues to Advance Program: TAK-020 (Phase 1) • Captisol-enabled oral Bruton’s Tyrosine Kinase (BTK) Inhibitor – Pursuing rheumatoid arthritis for initial indication • Trial expected to complete 1H 2016 Progr
Slide 63: Underlying Technologies
Underlying Technologies
Slide 64: A Proven Licensing Engine
A Proven Licensing Engine Diverse Technologies Continue to Drive Portfolio Forward 64 Solving solubility and stability challenges Selectively delivers broad range of pharmaceutical agents to the liver LTP Technology™ Allows for higher and more stable expression of recombinant proteins, partnerships
Slide 65: Key Platforms Driving Growth
45% 30% 2% 23% Key Platforms Driving Growth Programs spread across multiple IP families 65 • Captisol programs diversified across therapeutic areas and stage of development • Selexis programs have meaningfully diversified and expanded the portfolio • LTP/HepDirect programs are relatively new, and fu
Slide 66: Captisol: A Growing Technology that Enables New Drugs
• Captisol is Ligand’s patented, uniquely modified cyclodextrin – Designed to maximize safety while improving solubility, stability and bioavailability of APIs • Wide regulatory acceptance creates efficient development paths – Captisol-enabled drugs are marketed in more than 60 countries – >45 partn
Slide 67: The Need for Solubility Technology is Real and Growing
Captisol The Need for Solubility Technology is Real and Growing 67 • The industry’s need for proven solubility technologies continues to grow, as recognized in recent scientific publications • Needs exists for NCEs and for lifecycle management of existing drugs ‒ “Modern drug discovery techniques, w
Slide 68: Routes of Administration of Captisol Partnerships
67% 9% 12% 12% Ophthalmic Oral SubQ, IM, Nasal Intravenous Captisol-enabled™ Pipeline Routes of Administration of Captisol Partnerships 68 • ~5 years ago, over 90% of Captisol development programs were intravenous • Today, a growing number of partners are seeing the benefits Captisol can offer in ot
Slide 69: Captisol: Need for Solubility Technology
Captisol Need for Solubility Technology is Real and Growing 69 • Partners purchase Captisol from Ligand; the amount of Captisol used in a formulation generally far outweighs amount of API • Current commercial products use range of Captisol per daily dose: ‒ ~1 g to 13 g/day • Partners using higher a
Slide 70: Captisol Licensing in Recent Quarters
Captisol Licensing in Recent Quarters 70 • Existing partners continue to use Captisol for additional programs and new partners continue to seek licenses to Captisol
Slide 71: LTP Technology Platform
• Can be used to: — Improve activity and/or safety of an existing drug — Develop new agents to treat liver diseases — Treat diseases caused by homeostasis imbalance of circulating molecules controlled by the liver • Especially applicable to metabolic/cardiovascular indications, among others LTP TECH
Slide 72: SUREtechnology Platform
SUREtechnology Platform™ • SUREtechnology Platform based on novel DNA-based elements that control the dynamic organization of chromatin within mammalian cells and allow for higher and more stable expression of recombinant proteins • Improves the way cells are used in the discovery, development and m
Slide 73: GRA Program Update
GRA Program Update Eric Vajda
Slide 74: Diabetes: Serious and Growing Epidemic
• Diabetes is the 7th leading cause of death in the U.S., and significantly increases risks of other serious heath problems ― Heart disease, stroke, kidney failure, neuropathy, lower-limb amputations and blindness • According to the ADA, $245 billion in annual costs are attributable to diabetes ― $1
Slide 75: Diabetes: A Growing Epidemic
Diabetes: A Growing Epidemic 2014 Non-Diabetics Diabetics 75 2050 By 2050, 1 in 3 adults in U.S. will have diabetes if trend continues 9% 33% Source: American Diabetes Association, James P Boyle, Theodore J Thompson, Edward W Gregg, Lawrence E Barker and David F Williamson. Projection of the year 20
Slide 76: Glucagon Antagonism
• DPP-IV inhibitors, GLP1 agonists and SGTL2 inhibitors are commercially available classes of anti-hyperglycemic drugs that have been effective, but are associated with issues — Glucose control remains a problem for many patients — Dosing and delivery improvements needed — Safety issues (gastrointes
Slide 77: LGD-6972: Overview
• LGD-6972 is an orally available small molecule that potently binds to the glucagon receptor in vitro and competitively antagonizes the actions of glucagon • Glucose reduction has been demonstrated in animal models of both type 1 and type 2 diabetes • LGD-6972 has a clean safety profile in preclini
Slide 78: Insulin Signalling is defective
Insulin Signalling is defective 78 Diabetic Patients
Slide 79: Glucagon Signalling remains active
Glucagon Signalling remains active 79 Diabetic Patients
Slide 80: LGD-6972 blocks glucagon action in liver
LGD-6972 blocks glucagon action in liver, reducing glucose release 80 Diabetic Patients
Slide 81: Phase 1b Study Design
Phase 1b Study Design • Phase 1b multiple ascending dose trial in normal healthy volunteers (NHV) and type 2 diabetes mellitus (T2DM) subjects • Once daily oral administration for 14 days, evaluated in 4 cohorts: — 15 mg per day in NHV — 5, 10, and 15 mg per day in T2DM subjects • 48 subjects — n =
Slide 82: LGD-6972 Reduces Fasting Plasma Glucose
LGD-6972 Reduces Fasting Plasma Glucose Type 2 Diabetics 82 • LGD-6972 shows a dose-dependent reduction in fasting plasma glucose, with a maximal decrease of 60 mg/dL
Slide 83: Glucose is Reduced Throughout the Day
83 Glucose is Reduced Throughout the Day Type 2 Diabetics • 7 point glucose measurements performed on Day 1 and Day 14 • LGD-6972 decreased glucose in both fasting and postprandial states (approximate decrease in weighted mean glucose > 50 mg/dL)
Slide 84: Conclusions
• LGD-6972 is a promising agent for the potential treatment of type 2 diabetes ― Safe and well tolerated in a multi-dose study ― Robust reduction in glucose in both fasting and postprandial states • Efficacy and safety profiles are highly encouraging; potentially a best-in-class molecule • Glucose r
Slide 85: Ligand's Intellectual Property
Ligand’s Intellectual Property Charles Berkman
Slide 86: Intellectual Property Overview
Intellectual Property Overview • Significant annual investment in intellectual property supports licensing and helps further protect existing programs – Highly diverse patent portfolio – Ligand and/or partner IP protects each shot-on-goal – Layered protection - NCE, formulation, methods of use – Cur
Slide 87: Platform Technology IP
Platform Technology IP Distinct patent families cover various underlying technologies 87 Multiple patent families provide broad global coverage Four distinct composition- of-matter patent families Patent term to 2036 Provisional or International Stage (country selection pending) LTP Technology™ Pion
Slide 88: Captisol IP Overview
: IP Overview • Captisol substance patents – 4 distinct patent families – Issued patents in over 60 countries (7 U.S. patents) – Potential patent term to 2033 • Captisol process patents – 4 distinct patent families – Potential patent term to 2033 • Patents on specific Captisol-enabled product formul
Slide 89: Promacta and Kyprolis Patents
Promacta and Kyprolis Patents – 13 Orange Book-listed Patents – Patent term to 2028 – Foreign patents issued in all major countries 2023 NCE Patents 2026 Salt Patents 2028 Formulation Patents 2026 NCE Patents 2027 Formulation Patents 2033 Captisol Patents – 9 Orange Book-listed Patents to 2027 – Pot
Slide 90: The Big 6: Intellectual Property
• Emerging programs protected by broad, diverse and long-range IP Product Patent Term Scope EVOMELA™ 2030 2033 Formulation & Method of Use Captisol Portfolio Delafloxacin-IV 2029 2033 Formulation Captisol Portfolio SAGE-547 2033 2033 Formulation & Method of Use Captisol Portfolio Verubecestat 20301
Slide 91: Viking Therapeutics: Ligand Analyst Day
Ligand Analyst Day November 18, 2015 Novel Therapeutics for Metabolic and Endocrine Diseases (NASDAQ:VKTX)
Slide 92: Forward-looking statements
92 This presentation contains statements about our future expectations, plans and prospects that constitute forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by thes
Slide 93: Introduction
93 Introduction • Viking is a San Diego-based biotech company focused on novel drugs for metabolic disorders • Our clinical-stage programs are targeting: − Large, underserved markets − Each with global product market opportunities that exceed $1 b annually • Data read-outs expected for major Phase 2
Slide 94: Investment Highlights
94 Investment Highlights • Developing novel, first-in-class or best-in-class drugs for metabolic disorders − Three clinical-stage programs with preliminary efficacy signals in humans • SARM: In Phase 2 development for hip fracture − Non-steroidal Selective Androgen Receptor Modulator − Promising eff
Slide 95: Leading Pipeline Programs
95 Program Preclinical Phase 1 Phase 2 Phase 3 Highlights and Plans SARM VK5211 Plan to read out Phase 2 data in 2016 TRb VK2809 Plan to read out Phase 2 data in 2016 TRb VK0214 Complete key preclinical studies In vivo POC data in 2016 Leading Pipeline Programs Two Phase 2 trials for novel compounds
Slide 96: VK5211: SARM Program for Hip Fracture
96 • Novel Selective Androgen Receptor Modulator (SARM), for hip fracture − Potentially best-in-class small molecule SARM Potency, speed to activity Strong IP position • Target indication: Acute rehabilitation post hip fracture − Product market opportunity exceeds $1 billion annually >300,000
Slide 97: VK5211: Therapeutic Benefits of SARMs
97 VK5211: Therapeutic Benefits of SARMs SARM Retain beneficial properties of natural androgens, while mitigating side-effect profile associated with anabolic steroids Therapeutic Goal: Major Health Benefits for Three Main Systems Muscle Bone CNS Increase muscle mass Increase muscle strength Increas
Slide 98: VK5211: Hip Fracture an Ideal Market for SARMs
98 • Associated with high mortality, loss of function, increased risk of 2nd fracture − 20-30% 1-yr mortality, 50% lose walking independence, 20% require long-term care • Post-fracture patients experience accelerated loss of bone mineral density (BMD), lean body mass (LBM) − Rates of decline 12 to >
Slide 99: VK5211: Clinical and Preclinical Summary
99 • Excellent preclinical profile − Primates: Substantial increases in lean body mass at 12 weeks − Rodents: Rapid increases in bone mineral density, stimulation of bone formation • Three Phase 1 studies successfully completed − Single ascending dose study Single doses to 22 mg - all doses safe,
Slide 100: VK5211: Clinical Highlights
100 • Phase 1 multiple ascending dose study, healthy subjects (n=76) − Statistically significant improvement in lean body mass after 21 days − Positive trends in strength and performance measurements − Androgenic effect on total testosterone − Safe and well-tolerated with no drug-related SAEs VK5211
Slide 101: VK5211: Development Plan
101 • 12-Week Phase 2 trial in up to 120 patients with hip fractures − Primary endpoint: Change in lean body mass − Exploratory endpoints: Change in BMD, functional status, ADL, QOL − Data expected in 2H16 • Objectives: Understand effects on LBM, BMD, QOL, function − Loss of LBM believed to be a maj
Slide 102: Thyroid-b Agonist Program
102 • Proprietary platform for small molecule thyroid mimetics − Highly tissue and receptor selective − Differentiated prodrug technology, excellent oral bioavailability − Expected wider safety window, reduced cardiovascular risks vs. other approaches • Biological profiles suggest potential benefit
Slide 103: Thyroid Receptor Overview
103 Thyroid Receptor Overview • Nuclear hormone receptors • Two major subtypes − Thyroid beta receptor; Liver, brain, modulates cholesterol, triglyceride levels − Thyroid alpha receptor; Cardiac tissue, modulates heart rate, contraction • Endogenous ligand: Triiodothyronine, T3 Graphic: Harrison’s P
Slide 104: VK2809: Preclinical Summary, Hypercholesterolemia
104 • Lead TRb program: Liver-targeted prodrug of potent TRb agonist —Ki = 2.2nM, b:a selectivity 16:1 —Excellent in vivo safety profile (PNAS, 104(39), 15490-15495, 2007) • Potent cholesterol reduction observed in five species VK2809: Preclinical Summary, Hypercholesterolemia Time (weeks) -3 -2 -1
Slide 105: VK2809: Preclinical Summary, Liver Fat Effects
105 • Animal studies in mice and monkeys have shown profound effects in liver weights, which is a result of reduced liver fat content • Liver fat content reduced or cleared in mouse model of NASH − Dose-dependent reduction observed after only 10 weeks of treatment VK2809: Preclinical Summary, Liver
Slide 106: VK2809: 14 Day Phase 1b Highlights
106 • Placebo-controlled trial (n=56), mild hypercholesterolemia − Enrollment criterion: LDL ≥ 100 mg/dL • Results: Clinically meaningful, statistically significant reductions in LDL • Up to 79% reduction in triglycerides − Major component of liver fat • Safe and well-tolerated, no SAEs − No effect
Slide 107: VK2809: Phase 2 Trial
107 VK2809: Phase 2 Trial - Hypercholesterolemia, Fatty Liver • Phase 2 trial, hypercholesterolemia patients with fatty liver disease − Multi-arm, dose ranging (3 doses), ~20 patients per arm − 12-week double-blind treatment period − Primary endpoint: Change in LDL-C at 12 weeks − Other endpoints: C
Slide 108: Thyroid-b Agonists for X-ALD
108 • Target indication: X-linked adrenoleukodystrophy (X-ALD) • X-ALD is a rare, debilitating neurodegenerative disorder, cerebral form is fatal − No cure, no approved therapy − Strong rationale for TRβ agonists to show benefit • Demonstrated promising activity in preclinical X-ALD models • Plan to
Slide 109: TRb: X-Linked Adrenoleukodystrophy (X-ALD)
109 • Orphan peroxisomal disorder − X-linked → Carried by females, primarily manifesting in males − EU: ~12,000 patients − U.S.: ~ 8,000 patients • Most severe form: Cerebral ALD − Rapidly progressive inflammatory demyelination; disruption of blood brain barrier − Affects ~35% before age 12, ~20% be
Slide 110: TRb: X-Linked Adrenoleukodystrophy
110 TRb: X-Linked Adrenoleukodystrophy − ABCD1: Normal function to transport VLCFA into the peroxisome to be destroyed − With X-ALD Disease: ABCD1 is defective, leading to accumulation of VLCFA fats in the brain − High VLCFA levels disrupt cell membranes, causing inflammation in brain tissue, motor
Slide 111: TRb: Thyroid Agonists Hold Promise in X-ALD
111 • Thyroid receptor modulation may alter ALD pathogenesis • Alternative VLCFA transporters ABCD2, -3 are induced by thyroid hormones − Functional overlap with ABCD1; mechanistically compensate for ABCD1 deficiency TRb: Thyroid Agonists Hold Promise in X-ALD 1) Eur. J. Cell Biol. 87, 933-945, 2008
Slide 112: TRb: X-ALD Plans
112 • Current status − Evaluation of leads ongoing, encouraging in vitro results − In vivo model to begin dosing 4Q15 − Data expected 1H16 • Potential human POC study in 2017 TRb: X-Linked Adrenoleukodystrophy Plans
Slide 113: Investment Highlights
113 Investment Highlights • Developing novel, first-in-class or best-in-class drugs for metabolic disorders − Three clinical-stage programs with preliminary efficacy signals in humans • SARM: In Phase 2 development for hip fracture − Non-steroidal Selective Androgen Receptor Modulator − Promising ef
Slide 114: Financial Overview and Outlook
Financial Overview and Outlook Matt Korenberg
Slide 115: Projected Revenue Composition
$0 $20 $40 $60 $80 $100 $120 $140 2013 2014 2015 2016 2017 License and other Captisol Sales Royalties • License: consistent annual revenue expected from existing license agreements with over $2.5B in potential future payments • Captisol: revenue projected to grow with more Captisol products commerci
Slide 116: 2016 – 2017 Revenue Buildup
2016 – 2017 Revenue Buildup • Royalty revenue: — Derived from sell-side research analyst projections and management estimates • Captisol sales: — Projected to be between $30 and $40 million per year • License/milestones: — Projected to be between $12 and $20 million per year based on potential miles
Slide 117: Quarterly Revenue Patterns
Royalties • Most royalties have escalating royalty rates based on higher sales • Escalating rates reset annually on January 1 • Royalties paid on a 1-quarter lag • Q2 typically lowest quarter of the year for royalty revenue Captisol • Clinical orders based on size and timing of trial initiation • Co
Slide 118: General Assumptions
2016 - 2017 Royalty and milestone gross margin 100% Captisol material sales gross margin ~60% - 65% Cash operating expense $22 - 24M Fully-diluted share count ~21M, increasing ~0.3M/year Cash tax rate <5% General Assumptions 118
Slide 119: 2016 Projected Cost Structure
45% 45% 10% Company Operations Facilities, insurance, taxes and administrative expenses 2016 Projected Cost Structure • Annual cash costs of ~$22 million • Efficient cost structure that supports activities to further expand the “Shots-on-Goal” portfolio Pipeline Costs Research & development, busines
Slide 120: Adjusted EPS
• Items excluded from GAAP EPS to derive adjusted EPS: Item Rationale Change in contingent liabilities • Non-cash adjustment in fair value of CVRs • Based partly on market values Mark-to-market adjustment for investments owed to licensors • Non-cash adjustment based on market value of certain market
Slide 121: Reconciliation of GAAP EPS to Adjusted EPS
Reconciliation of GAAP EPS to Adjusted EPS Illustration of adjustments to reported quarterly net income 121 Q3 Net income $224,539 (Decrease) in contingent liabilities (2,301) Mark-to-market adjustment for investments owed to licensors (593) Non-cash stock-based compensation expense 2,836 Non-cash d
Slide 122: Share Count Dilution from Convert
Share Count Dilution from Convert 122 • Beginning with 2016 guidance, we will calculate our adjusted EPS excluding the shares related to the convert • These shares will never actually be outstanding • With our stock price above $75.05, GAAP EPS will include shares from the convert Quarterly Av rage
Slide 123: Summary of Tax Changes
Summary of Tax Changes • Previous: — Balance Sheet: >$700 million of tax assets (i.e., Federal and State NOLs, plus R&D credits) not reflected on balance sheet — Income Statement: Tax rate on reported income <3% typically • Current/Going forward: — Balance Sheet: >$700 million of tax assets will be
Slide 124: Two-Year Financial Outlook
• High annual revenue growth projected — 2016: $107 - $111 million; 40% to 45% growth — 2017: >$146 million; 30% to 35% growth • Low annual cash expenses of approximately $22 to $24 million per year • Strong earnings per share growth projected next two years — 2016: $3.33 - $3.38 — 2017: >$4.75 Two-
Slide 125: Upcoming Potential Events
Upcoming Potential Events Potential Milestones for Ligand and Partners in Coming Quarters Company Program Milestone Lundbeck Carbella U.S. FDA Action Alvogen Voriconazole U.S. FDA Action Melinta Therapeutics Delafloxacin IV NDA Submission; U.S. FDA Action Novartis Promacta ASPIRE Phase 2 completion
Slide 126: Upcoming Potential Events
Upcoming Potential Events Potential Milestones for Ligand and Partners in Coming Quarters Company Program Milestone CURx Pharma IV-Topiramate Phase 2 start (epilepsy) MEI Pharma MEI-344 Phase 2 start (solid tumors) Precision Biologics NPC-1C Phase 1/2 completion (pancreatic cancer) Millennium / Take
Slide 127: 2016 and Beyond Analyst Day
2016 and Beyond Analyst Day New York - November 18, 2015 NASDAQ: LGND
Ligand Pharmaceuticals — Investor Day (November 2015) on 6ix