|Company Name:||Seattle Genetics, Inc.|
|Event Title:||2013 William Blair & Company Growth Stock Conference Transcript|
|Event Time:||09:00 AM ET|
Analyst, William Blair
Good morning everybody. This is John Sonnier, I am the Senior Biotechnology Analyst at William Blair. I appreciate everybody joining us early this morning for Seattle Genetics. Before I introduce our speaker I have a responsibility to disclose that William Blair does have an investment banking relationship with Seattle Genetics and to see full disclosures you can go to our website www.williamblair.com. With that, we're pleased today to have Chris Boerner from Seattle Genetics as our speaker. He is from Investor Relations.
And I thought Chris would be a great choice for this conference because a lot of investor focus right now is on launch of the company's drug at ADCETRIS which is approved in two indications in the U.S. Chris oversees the commercial operation and he can talk about that opportunity in greater detail as well as other the aspects in the company. Chris?
Chris Boerner, Ph.D.
Senior Vice President, Commercial
Thanks John, thanks also for giving me the opportunity to come talk to you about Seattle Genetics this morning. For those of you who are unfamiliar with the company, we are a Seattle based biotech focused on the development of empowered antibodies to treat cancer and specifically we focus on antibody-drug conjugates or ADCs. ADCs are essentially monoclonal antibodies that have attached to the very potent cytotoxic and so it's a way to deliver a powerful drug in a very targeted way. The company was founded in 1998 and really for the last 15 years we have been focused on becoming the leader in the development of ADCs and with the approval of our first product in August of 2011, we are really at the frontier of commercializing this technology as well.
This morning I'll give you an overview of the company, touch on the technology, but then I'll spend the majority of the time talking about some of our near term commercial and development activities as John mentioned that's where I spend the majority of my time.
Before getting into the details, I'll remind you I will be making forward-looking statements and I refer you to filings that we make periodically with the SEC. I thought I would start by giving you an overview of the key strategic priorities for the company, first and foremost we are focused on extending on the very successful launch that we've had with ADCETRIS we were approved in August of 2011. Since then we've garnered additional approvals in Canada and along with our partner Takeda Millennium in the European Union as well as a number of other countries globally.
We are currently approved in over 30 countries worldwide and we are well on our way to establishing ADCETRIS as a global brand to fully maximize the value of this product we have a broad development program in Hodgkin lymphoma and non-Hodgkin lymphoma as well as other CD30 positive malignancies. A second priority for the company is to continue to advance our leadership position in antibody-drug conjugates, we have a number of collaborations that utilize our technology to develop their own products, we also have a very robust pipeline of our own that includes four clinical-stage ADCs and we plan to bring two additional products into the pipeline later this year and I will talk more about that later in the presentation.
And finally, we are very focused on maintaining a very strong financial positions as we'll talk about in a bit, we finished the first quarter with over $340 million in cash, we have no debt and now with our first approved product, we have robust product sales in the U.S. and Canada as well as royalties coming in for the sale of ADCETRIS in the Takeda Millennium territories and we also have revenue coming in from collaborator activities. And all of that is of course important because it enables us to execute on our ADCETRIS program as well as to continue to move forward the pipeline.
Speaking of the pipeline, this is a slide that depicts it, the top half of the slide really focuses on ADCETRIS , we are approved with ADCETRIS in two broad disease areas, relapsed Hodgkin lymphoma and there we are approved for patients who have failed on autologous stem cell transplant as well as patients who are ineligible for a transplant, we also approved in relapsed systemic anaplastic large cell lymphoma, ALCL is a relatively rare sub-type of T-cell and there we are approved for patients who have failed frontline therapy.
So those are our approved indications that's our base book of business if you will and then you can see the additional investment that we and our partner Takeda Millennium are making for the ADCETRIS programs, I won't go to the details here as I will be touching on many of these important programs later in the presentation. I'll just highlight now that we have just shy of a dozen ongoing corporate sponsored studies that includes four large phase III programs all of which are being conducted with our partner Takeda Millennium and all of this is in addition to considerable interest by investigators and so there are a lot of investigator sponsored studies with this product as well.
This really is an example of a product that has its own pipeline. The bottom half of the slide is the rest of our internal pipeline, as I mentioned we have four clinical-stage ADCs those are the first four of these that you see here, this a pointer or not but, the first four and the then the bottom two are the two ADC's that we will be brining into the clinic later and I'll talk more about these later in the presentation.
For those of you who are unfamiliar with our technology, ADCs are essentially monoclonal antibodies that have cytotoxics that are attached to them. And the idea is to use the ability of the monoclonal antibody to target very specific receptors that set on the surface of cancer cell and then to deliver that cytotoxic payload to that site and thereby hopefully eliminate some of the traditional toxicities that you see with chemotherapies. Conceptually the idea has been around for decades. The challenge is to developing ADCs have really been two, first finding a potent and efficacious cytotoxic to conjugate to the antibody, and then second, finding a linkage system that keeps that cytotoxic attached to the antibody, while it is in circulation and then allows it to come off right when it hits its target.
Our first product ADCETRIS overcomes both of these challenges, the cytotoxic we use is called orastatin it is a very potent antimitotic drug, it interferes with mitosis so cell division. We also have with ADCETRIS a stable linker with a very long half life that enables the drug to stay conjugated to the antibody in circulation and then it is cleaved when it is internalized into the cancer cell and that's what depicted in the cartoon in the upper left.