What It's Like To Have Dinner With BioMarin Executives -- Dr. Schoenebaum's Takeaways

• Mark Schoenebaum, MD, of Evercore ISI met with BioMarin Pharmaceutical Inc. BMRN’s CFO Dan Spiegelman, Site Head of BioMarin Nederland and DMD lead Scott Clarke, and Head of IR Traci McCarty.
• In an email sent to investors, the analyst shares six key highlights from his meeting.
• Shares of BioMarin fell almost 3 percent on Wednesday trading.

After having dinner with BioMarin’s management team, Schoenebaum shares six takeaways:

1)   Management, one again, said it is confident that drisapersen could be potential approved in the U.S. before the end of the year. The team said a few recent interactions it had with the FDA since it closed Prosensa in January were the main reason behind its increased confidence “from the time of the deal announcement last November, when BMRN only had the FDA meeting minutes (which alone were enough to drive the purchase of Prosensa).”

2)   The FDA seems to be open to a variety of designs for the drisapersen confirmatory study, including a “pbo-controlled study of drisapersen in exon 51 - a study that management believes could be enrolled ex-US and would have important commercial implications with payers.” The company is waiting until it receives the final guidelines from the FDA to commence with the confirmatory study, which it think will be finalized post AdCom.

3)   Management think that, if drisapersen is approved in the EU in 2016, its orphan designation could –possibly- prevent Sarepta Therapeutics Inc SRPT from marketing; “whereas in the US the bar for orphan exclusivity is lower and both BMRN and SRPT should be able to market. About ~30% of the global addressable market for drisapersen is in EMA governed territories (and the US only represents ~15% of the market). Recall, BMRN is expecting a CHMP opinion for drisapersen in 1Q 2016,” the research note adds.

4)   BioMarin will also evaluate Hemophilia A gene therapy. The company will dose the first patient very soon, and the analysts at Evercore ISIS believe data could be released by the end of the year.

5)   For PEG-PAL, the experts anticipate “data from the phase 3 randomized discontinuation study [is] set to read out late Q1 next year. Based on recent discussions with the FDA, management believes that only Phe lowering will be required for approval, yet a statistically significant result in neurocog will be useful commercially,” the report notes.

6)   Management reiterated the company’s commitment to its non-GAAP profitability guidance for 2017, if drisapersen is approved in either the US or EU. The team also thinks the balance sheet has "considerable" flexibility to do another deal. The analysts note that, BioMarin “would, in theory, do a ‘compelling’ BD deal that would delay 2017 profitability, yet the bar would be exceptionally high and that is not base case expectation.”

Disclosure: Javier Hasse holds no stakes in any of the securities mentioned