PropThink: Management says Ariad is Well-Prepared for Ponatinib Launch
By Jake King
On the heels of ponatinib's Priority Review announcement, Ariad Pharmaceuticals (NASDAQ: ARIA) reported 3Q financial results Wednesday, and on its related conference call emphasized the preparation of a ponatinib-specific sales force. Pending ponatinib's approval for treatment of resistant or intolerant chronic myeloid leukemia (CML), Ariad believes they are fully prepared for a U.S. commercialization (PDUFA slated for March 27, 2013), and efforts are underway in the E.U. to assemble a similar sales force. Management expects European approval and launch in the third quarter of next year, and is committed to being launch-ready by July 1, 2013.
Ariad's net loss for the quarter was $53.2 million, or $0.32 per share, in tandem with consensus estimates despite a miss in revenue expectations, $.85M vs estimates of just under $1M. Last year the company reported a 3Q net income of $13.9 million, or $0.10 per share, and comparative decreases are due to growth of R&D and SG&A expenses, and higher licensing revenue in the previous year's quarter. Management said that costs related to sales representative training and hiring are a fourth quarter expense, and we expect SG&A expenses to continue rising through the end of the year. Ariad reported cash, equivalents, and investments of $206.7M. If the company successfully executes ponatinib's launch by the second quarter of next year, Ariad could swiftly move towards positive cash-flow.
Management briefly discussed recent entrants into the field of CML treatment, specifically Synribo from Teva (NYSE: TEVA) and Pfizer's (NYSE: PFE) Bosulif, both of which were approved in the second half of this year. The company does not expect either drug to pose a major threat to ponatinib based on superior efficacy and broader labeling potential for Ariad's drug. Management also noted that Gleevec's possible patent extension through 2019 would be positive for ponatinib; Gleevec, by Novartis (NYSE: NVS), is set to lose patent protection in 2015 unless Intellectual Property protection improves, and as the leading first-line CML treatment, a cheaper generic stands to make a major dent in the market for branded products. Ariad is also pursuing a first-line indication for ponatinib with the ongoing Phase III EPIC trial, which could release interim results in early 2014 depending on enrollment speed. Click here to continue reading.
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