Analyst Conference Summary

Biogen Idec Corporation
Research & Development Day

conference date: March 25 , 2009 @ 10:00 AM Pacific Time
At least at the time this summary was written.
Forward-looking statements

Please note that the full presentation lasted over 5 hours, so these notes are necessarilly just hitting the highlights. I am focussing on newer therapies, and leaving out the Tysabri material.

Biogen has the capability to both discover and bring to market new therapies. The pipeline has included some in-licensing. Many molecules are first in class or best in class in their therapeutic areas. They are experts in biologics, but have developed small molecule expertise as well. Targets are based on biology and disease pathology and are for high-need markets. Experiments are scientifically rigorous, designed to give go/no-go signals.

The late stage pipeline has grown rapidly. There should be 9 programs by the end of 2009, up from 5 at the beginning in 2008. Biogen's Pipeline covers diverse therapeutic areas: neurology, oncology (cancer), immunology, and cardiology. There are always going to be some negative readouts as parts of the development process.

Currently there are 20 preclinical programs; 5 first-in-human; 13 proof-of-concept; and 7 in registration and filing. Moody's rated Biogen's late-stage pipeline as the highest quality in the industry.

End of 2009 registration programs are: BG-12 for MS (multiple sclerosis); Galiximab; Lumiliximab; Lixivaptan for Hyponatremia; Ocrelizumab doe RA; ADENTRI IV; PEG-IFN; Lixivaptan - HF; Daclizumab.

Potential readouts in 2009 & 2010, that generate go/no-go decisions, include Avonex in UC; CDP323 in RRMS; Daclizumab in RRMS; Long Acting rFactor IX in Hemophilia B; Lumiliximab in CLL (Chronic lymphocytic leukemia); Ocrelizumab in RRMS and Ocrelizumab in RA (rheumatoid arthritis). All are in Phase II except the last is in Phase III.

Infereron drugs work well in relapsing (inflammation) phase of MS (Multiple Sclerosis), but when MS progresses they stop working in the degeneration phase. BG12 may work in this later stage. It activates the Nrf2 Pathway, alowing it to remain alive longer in the cell. Knocking out Nrf2 in mice leads to neurodegeneration that looks like MS. BG12 has anti-inflammatory effects, but also protects the cells. It has interferon like efficacy in a pill. There are some adverse events in the first month, but they are irritations and are not accompanied by increased infection rates. May have best benefit/risk ratio of any new oral MS drugs. Related to Fumaderm, which has 15 years on market in Germany for psoriasis.

PEGylated Interferon B-1a (PEG IFN) for MS is notable mainly because it can be administered subcutaneously once every two or four weeks, which should improve convenience and compliance. Success in the Phase III trial should lead to FDA approval.

Have been expanding in Cardiovascular therapies and plan to continue. Heart failure incidences are continuing to rise. Mortality is still high, 25% at 1 year and 50% at five years. Cost is very high for hospitalizations. Renal insufficiency is highly predictive for heart failure and is present in 65% of patients. Lixivaptan (VPA-985) is in multiple Phase III trials for heart failure/hyponatremia. It is an oral vasopressin V2 receptor small molecule agonist.

Adentri is a small molecule adenosine receptor agonist with high affinity for A1 receptors. It disrupts tubular glomerular feedback in the kidney; this helps preserve kidney functioning. It is in Phase II and III trials.

For immunology, Biogen is looking at autoimmune diseases with high unmet needs: MS, Inflammatory Bowel Disease (Crohn's, UC), Rheumatoid Arthritis (RA), and Systemic Lupus Erythematosus. Rituxan is targetted at RA, which is in trials to expand its usage. It is very effective and puts some patients into remission. It has a remarkable safety record. Retreatment with Rituxan shows benefits, and adverse reactions go down over time. There is a strong immunology drug discovery program in place which is looking at next generation targets.

Oncology pipeline builds on Rituxan expertise. GA101 is the third-generation improvement on Rituxan. Rituxan binds to and kills CD20 expressing cells. Plans to file for both frontline and relapsed CLL this year. GA101 preclinical data shows superiority over Rituxan. Lumiliximab shows increased B-cell killing (apoptosis). It binds with CD23, which is highly expressed and abnormally regulated on CLL cells. It is in trials at Phases I, II, and III.

CD80 is expressed on NHL tumor cells; this is the target of galiximab. Preclinical data shows enhanced anti-tumor activity in combination therapy. There are numerous galiximab clinical trials for lymphoma for relapsed and frontline NHL, both as a monotherapy and in combination with Rituxan. Also in relapsed Hodgkin's.

The oncology pipeline also includes many earlier stage, promising programs. HSP90 inhibitors for solid tumors has made progress, as has Anti-IGF-1R and Anti-Cripto-DM4, which are in Phase I.

"This is really going to be a breakout year for us." The number of patients in clinical trials is doubling in 2009.

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Copyright 2009 William P. Meyers