Gilead at Piper Jaffray Conference Notes

Gilead Sciences’ (GILD) CEO John Milligan Presents at Piper Jaffray

Healthcare is likely to remain stable in 2017

” I think we will make the assumption that 2017 with regard to patients and how they achieve their healthcare is probably stable. I don’t think you could disrupt it from where it is now without massively, without causing a massive amount of unhappiness across the US population. Everybody signed up were now ready to get into the new plans if there any for next year. And so I think, if you are going to unwind healthcare, it has to be a couple of year process of getting things ready to transition people to something new and I just don’t see how it’s could happen in 2017.”

Some thoughts around M&A

“And so, a lot of folks have suggested that we go out and prices be down, we’ll just go out and buy whatever we want to buy. I, having lived through years have got getting beat up for mergers where people were questioning what our IRR could possibly be, in fact, they’ve all turned out very, very well. It is a different world than I am used to in that respect.

I think we are going to be disciplined and thoughtful and where we are going to stick with our plan rather than jump around of going after very specific areas where we can provide the data, the scientists and the selling power to make things happen rather than jump into category-after-category which often look good on spreadsheets, but are in fact quite difficult to manage.”…

“Could you ever get your money back? Some of these deals that I’ve seen I don’t think that would be true. So you have to believe that there is something else that you can do with that they are some other catalysts that you can have. And so, we’ve looked at a lot of things and chose them not to participate or we are not the winner at the end of the day. Those things happen in this field especially in competitive areas that we are in.”

Gilead at Jefferies Conference Notes

Gilead Sciences’ (GILD) Management Presents at Jefferies Healthcare Brokers Conference

Robin Washington – EVP & CFO

We’re very science focused

I think one of the things you’ve heard us talk about relative to size is not necessarily wanting to acquire a large amount of people as opposed to size of deal in that we value our culture. It’s very scientific focused, it’s very agile. And I think where we play best and what our core competencies lead us to is assets where we can further refine the scientific direction, focus on interactions with the FDA, as opposed to synergistic transactions where we’re trying to right-size organizations. Those things can be done, but I think our focus is on the latter.

We were surprised on the downside with HCV

If you take our two core franchises, HIV and HCV, we were surprised to the upside relative to HIV and surprised somewhat to the downside relative to HCV. And I think relative to HCV obviously we had Merck enter the market and from a competitive standpoint there were a few areas where we saw increased discounting that was particularly in the VA which we mentioned and other select areas.

The patient inflow was greater than we expected

the reality of it is I don’t think anyone, included us expected the level of that initial patient flow. We always said it was going to be like this and it kind of spiked up here really quickly. So ultimately that predictability is really important for the system to treat. I do think as we’ve got beyond those patients that really didn’t necessarily have alternatives prior to Harvoni and Sovaldi or didn’t necessarily want to go through some of the side effects of some of the earlier treatments, the less sick patients and the doctors’ cues are being rebuilt.
And I think as payers still look at pricing and look at this initial impact to the system and cure they want to be sure those patients are ready. And I do think that takes time. I think it takes time to profile these patients, to understand – this will always be a tightly managed market.

We’re not afraid to kill programs if it makes sense

And we like that optionality because at the end of the day we are a scientific company and we want to focus on doing the right thing. And that being said, we’re not afraid to kill programs. We’re not afraid to determine that something internal doesn’t make the most sense and we need to go out and acquire, and we continue to do that.

Hep B is top focus right now

I would say from a hep C perspective you know R&D spend and particularly our research spend has waned over the last couple of years. We think we’ve done a lot there. Research hep B is probably our top focus right now, very early stage. I think you’ve heard Norbert and John talk about we’re most excited about NASH, we do feel we’ve got all the assets we need and we think we’re the leader relative to a NASH pipeline today.

Focus on managing payer strategy is important in this environment

To your specific question about Marty, I think his background particularly as it comes to reimbursements, if you think about not only hep C, but some of the markets we talked about in inflammation and oncology clearly very competitive marketplaces where I think it’s very evident to us that additional focus on managing our payer and contracting strategy is a really important thing to do.

Celgene’s CEO Presents at JP Morgan Conference Notes

http://seekingalpha.com/insight/earnings-center/article/3803236-celgene-corporations-celg-ceo-presents-at-the-34th-annual-j-p-morgan-healthcare-conference-transcript?part=single

Bob Hugin

Macro doesn’t effect our industry, where scientific advances are meaningful

I was thinking about this whole mission and vision when Carlos was speaking and the year is off to a somewhat challenging start with the implications of concerns about the transformation of the Chinese economy and the reverberations in equity markets. But I do have to tell you that I don’t think those reverberations and those short-term implications can mask the underlying strength of our industry. The type of scientific advances are accelerating and are meaningful.”

It is no doubt the dawning of the decade of molecular biology and information technology

“The impact on patients over the next decade, we think about this coming decade, it is no doubt the decade or the dawning of the decade of — the impact of molecular biology combined with information technology.”

Building a good pipeline is about understanding where you have a competitive advantage

“it’s all based on the focus on internal excellence. Understand where you have competitive advantage. And we think we have great expertise internally in cancer stem cells, immuno oncology, epigenetics, protein homeostasis, immunology generally, and with the context of next generation biologics, modalities being applied to all of those areas.”

Important to work with external partners too

“when we put out pipeline together internal and external, it’s more than double what it would be if we were focused on these exciting areas of technological promise alone. But its not just it — of in terms of just an additive, it is synergistic and the probability of success for all of us is greater because we work together. We have high expectations in 2016 in advancing this pipeline. ”

Dynamic companies don’t just manage their portfolios, they lead

“Dynamic companies don’t just manage their portfolios, but they lead, and they challenge their leaders, and they challenge their teams. They stretch their teams. They stretch their leaders. And they also capitalize on the incredible strength and experiences of their leaders”

Gilead at William Blair Conference Notes

Robin Washington – Chief Financial Officer, Executive Vice President

19 products

“we currently have 19 market products. We are best known for our HIV products. They are highlighted in the shaded area all the way to the left on my screen, our single table regimen, which we will talk a little bit about later in the presentation.”

Lots of details on pipeline in last call

” Our Chief Scientific Officer highlighted a lot of our programs on our last Q1 call, so I would encourage you to read the transcript to get a lot more details than I am able to provide if you want to understand more about our pipeline, but we are very, very excited.”

HIV is a chronic disease, you’re on the meds for 50 years

“Keep in mind that unlike HCV, HIV is a chronic disease. Once you go on medications, you are on medications for life, so if you are diagnosed with HIV in your 20s or 30s, you may be taking our medications or other medications for up to four to five decades for the full period of your life. ‘

Our first oncology launch

“I am going to briefly turn to oncology. I mentioned the Zydelig launch. Again, it is very early days. As many of you know, when you launch an oncology product, you start with the sickest of sickest patients. They are otherwise known as double refractory patients. That is where we are currently marketing this product in the U.S. and E.U. I did mentioned that it is our first oncology launch.”

Treated 4% of the HCV population so far

“Since the launch of our products in December 2013, this is both Harvoni as well as Sovaldi; you can see we have had a nice ramp uptake relative to usage. We believe, we have treated as of March 31st, 2015 about 260,000 patients or 4% of the estimated population and this is just in the core markets and does not really include Japan, so there is a lot of discussion around the stability and the longevity of the hepatitis C market, but we clearly think relative to budgets, a number of patients to treat that that market will be around for decades to come.’

NASH is an emerging disease

Liver disease I wanted to briefly touch upon NASH, this is another emerging disease, particularly in the U.S., where we estimated that over 12 million patients could have it, it is also looking to potentially be one of the top areas that will result in the liver transplant if not treated.’

Invest free cash in pipeline but also repurchase shares

“we have a very robust pipeline so we continue to focus our cash and investment in terms of growing that pipeline. In addition to that, we are also very conscious of the need to return value to our shareholders. We have had a very robust share repurchase programs for many years. Again, given our continued success, we continue to incrementally increase it.’

Celgene at UBS Healthcare Conference Notes

A digest of some of the top insights that I’ve gathered from this week’s earnings calls.  Full notes can be found here.

Mission:

“our mission is and what our vision is and that is to continue to build a great biopharmaceutical company, focused on oncology, hematology and now immune and inflammatory diseases as well”

30 ongoing trials

“We also have a very unique R&D capability. We’ve done a lot of work internally in hematology, oncology, and many other products on the market, certainly all of them on the market. And those in our pipeline come from our own internal portfolio with a very rich pipeline of probably over 30 trials ongoing, certainly in Phase III and moving to the market.”

Focus on unmet needs

“the business model is one that we feel very good about. It is initially looking at those unmet medical needs. Where can we have a transformative impact on a disease, on patients, and with that coming up with differentiated products out of our own pipeline, those of our partners, leveraging the infrastructure that we’ve built on the hematology side, the oncology side, now in I&I, to ultimately develop those products, get them approved, gain pricing and reimbursement and move those products and those therapies to patients.”

Bring the drugs to market, reinvest in more products

“And once we do, it’s the execution in the marketplace that we’ve done very well in the hematology side, on oncology and now we’re doing in I&I that just completes that virtuous cycle that allows us then to take some share of those revenues, reinvest them into more development of products and continue to bring products onto the market. ”

Products driving 13B-$14B in revenue in 2017

“REVLIMID forecasted in 2017 to be a $7 billion drug in multiple myeloma, mantle cell lymphoma and another — number of other hematological malignancies. POMALYST/IMNOVID, our follow-on product that was introduced in the US and also in Europe, we see at $1.5 billion by 2017. So the hematology franchise continuing to execute well with the core products. In ABRAXANE, on the solid tumor side, anywhere from $1.5 billion to $2 billion with certainly the breast, the lung cancer and now the pancreatic cancer indications. OTEZLA, our newest marketed product, $1.5 billion to $2 billion also in 2017, and I’ll now tell you in a moment how we’re going to get there. So 2017, $13 billion to $14 billion in sales by that period of time.”

How to grow the company beyond 2017

“How do we continue to grow Celgene beyond 2017 into the 2020s and beyond. We believe Celgene will be a Company for generations to come and it is about the pipeline. We’ve been very active on the external development front over the last several years with the strategy of identifying areas where we want to be a significant player and can’t do that on our own. Well, we need to access the expertise of partners, of companies who are focused in a particular area of expertise. Folks like Agios in cancer metabolism; Epizyme in epigenetics; FORMA in protein homeostasis; ABRAXANE, Acceleron and others who have the expertise in a specific area that we could never assemble at Celgene on our own”

Leverage capabilities in discovery, development, approval and market access

“partnering with those folks will allow us to leverage not only our own internal capabilities in discovery, but importantly in development and approval and market access, but the partner’s expertise in a particular technical area.”