company update - tradinfo · " broad partnered pipeline maximizes number of resulting...
TRANSCRIPT
Company Update
January 2008
Safe Harbour
This presentation includes forward-looking statements.Actual results could differ materially from those included in the forward-looking statements due to various risk factors and uncertainties including changes in business, economic competitive conditions, regulatory reforms, foreign exchange rate fluctuations and the availability of financing. These and other risks and uncertainties are detailed in the Company’s Annual Report.
Company Update | January 2008 Page 3© MorphoSys AG
MorphoSys at a Glance
! 50 antibody programs ongoing, thereof 4 in phase 1 trials, 22 in pre-clinic
! Multiple partners and indications
Broad Therapeutic Antibody Pipeline
! A leading, independent, antibody companyCompany
! HQ in Martinsried/Munich ! Therapeutic and research antibody
business units! Headcount ~300
Organization
! Profitable on revenues over $80m (2007E)! ~$150m cash! Over $600m in future revenue assured
Financials
! Frankfurt Stock Exchange (since 1999)! Member of TecDAX index (since 2004)
Listed
Company Update | January 2008 Page 4© MorphoSys AG
Recent Newsflow
Nov Dec Jan
Announcement of development of next generation
HuCAL PLATINUM
Technology package in-licensed from Dyax
Landmark $ 1 billion strategic alliance with
Novartis
CTA filed for European Phase 1 trial of MOR103
2007
Disclosure ofGM-CSF as Target
of MOR103 Program
2008
Company Update | January 2008 Page 5© MorphoSys AG
HuCAL: Leading Antibody Technology
" Antibodies can be…optimized to match therapeutic application utilizing modular design
" Antibodies are…fully human
" Ancillary proprietary technologies include…
!RapMAT – accelerated optimization,!AgX – efficient antigen production,!TRIM – trinucleotide mutagenesis
HCDR3 LCDR3LCDR2LCDR1HCDR2HCDR1
7 x HuCAL VH 7 x HuCAL VL
HuCAL®
(Human Combinatorial Antibody Library)
A vast collection or ”library“ of over 12 billion human antibodies designed to enable systematic optimization of antibody properties
Current version: HuCAL GOLD
In development: HuCAL PLATINUM
Modular gene design & construction
Company Update | January 2008 Page 6© MorphoSys AG
Robust Intellectual Property Protected by Core Patent Families
"HuCAL Library Design and Use (~2016 expiry)! 5 US Patents! 1 EU Patent (several EU states); allowance received for Divisional! 2 AU Patent! Pending applications: CA EU JP US
"TRInucleotide Mutagenesis (JHU excl. license) (~2012 expiry)! 1 US Patent; EP upheld in amended form; pending in JP, CA
"Disulfide Display (CysDisplay) (~2020 expiry)! 1 US Patent! Favorable prosecution for EU application! Pending applications: AU CA EU IL JP NO US
"Technology Development (HuCAL PlatinumTM)! Numerous applications in priority year or international phase (PCT) ! Co-exclusive access to various Dyax biologics patent families
Company Update | January 2008 Page 7© MorphoSys AG
Business Segments
Research AntibodiesTherapeutic Antibodies
" Broad partnered pipeline maximizes number of resulting products, reduces risk profile
" Proprietary, un-partnered programs offer even greater upside
" New Novartis alliance secures partnered pipeline, will finance own product development
" Built by merging:
" Top 20 supplier of research antibodies
" Platform to increase uptake of HuCAL in research community
Company Update | January 2008 Page 8© MorphoSys AG
see p. 1324 Partnered Programs
see p. 13 Various*20 Partnered Programs
Phase 1 Phase 2Pre-clinicDiscovery
Various*
CancerMOR202
Rheumatoid ArthritisMOR103
CancerNovartisn.d.
Cancern.d.n.d.
Alzheimer‘s DiseaseRocheR1450
CancerGPC Biotech1D09C3
Phase 3IndicationPartnerName
Product Pipeline
* Includes cancer, inflammatory, autoimmune, infectious, musculoskeletal & central nervous system diseases
Company Update | January 2008 Page 9© MorphoSys AG
MOR103: A HuCAL Antibody for Rheumatoid Arthritis (RA)
" Medical Need! RA patients adequately treated: Under 25%! Non-responders to anti-TNFs: 30%! Non-responders after 2 years on anti-TNF: 50%! Long-term safety issues with anti-TNFs
" Drug Candidate! HuCAL antibody vs. GM-CSF! Very high affinity and expression: potential CoGS advantage! Potential in asthma, COPD & other inflammatory conditions
" Development! Clinical material produced in PerC6 cells (Crucell/DSM)! Dec ‘07: CTA filed for European phase 1 trial ! Jan ‘08: Exclusive licence on US patent application on target
" Fully independent of Novartis collaboration
Company Update | January 2008 Page 10© MorphoSys AG
MOR202: A HuCAL Antibody for Multiple Myeloma (MM)
" Medical Need! MM accounts for 10-15% of hematological & 1% of all cancers! Few available treatment options, no curative therapies! New agents, Velcade and Revlimid, have efficacy (non-
responders) and safety issues" Drug Candidate
! HuCAL antibodies vs. CD 38, a 45kDa glycoprotein! Over-expressed on MM (95%) and some leukemia cell-lines! Compelling efficacy data in vitro and in vivo (SCID mouse)! Mechanism is ADCC plus effector cell independent
" Development! Currently defining therapeutic window, effective
dose level, stability, tox species" Fully independent of Novartis collaboration
Company Update | January 2008 Page 11© MorphoSys AG
Therapeutic Antibody Partnerships
16 renowned pharma and biotech companies are currently working with HuCAL technology and/or developing specific HuCAL drug candidates
Active Collaborations
HuCAL Program(s) Ongoing
Partner
Development, registration, commercialization
Generates & optimizes antibody
Grants exclusive license “first-come-first-served“
Partner
Provides Target
MorphoSys
Company Update | January 2008 Page 12© MorphoSys AG
Roche
Oncomed
Eli Lilly
Boehringer Ingelheim
Merck & Co.
Daiichi Sankyo
Schering-Plough
Pfizer
Astellas
Novartis
201220112010200920082007
Active Collaborations: Timelines
Company Update | January 2008 Page 13© MorphoSys AG
Partnerships: Typical Terms per Program
1 2 3 4 5 6 7 10 Years8 9
Success fee
Phase 1 milestone
Phase 3 milestone
Approvalmilestone
Royalties(mid single digits)
Exclusive licence fee + FTE support
9-12
MorphoSys costs
4
20
24
EUR millions
Number ofpartnered programs
currently at each stage
Company Update | January 2008 Page 14© MorphoSys AG
Landmark Strategic Alliance With Novartis
- MOR has options to co-develop a limited number of programs
Clinical Development
- MOR has options to co-detail those programs it co-develops in certain marketsMarketing
- Preclinical development of selected programs at MOR, funded by NOV
Preclinical Development
- Exclusive target model, first-come-first-served- Large number of program starts on NOV targets- MOR primarily responsible for lead generation &
optimization
Lead Generation/ Optimization
- GOLD + PLATINUM HuCAL libraries & related new technologiesTechnology
Primary responsibility Secondary responsibility New opportunity for MorphoSys
Company Update | January 2008 Page 15© MorphoSys AG
Financial Details
" Approx. $600m over 10 years! Approx. half ($300m) in technology license fees plus internalization fee for
HuCAL, comprising contingent double digit success payment! Approx. half ($300m) in research funding for team at MorphoSys
Committed Funding
" $1 billion, comprising! $600m committed funding (see below)! $400m in milestones (probability-weighted assessment)! Does not include royalties
Revenue to MorphoSys
" Shared costs & profits (sliding scale) on co-developed programsCo-development
" On all programsMilestones & Royalties
" 10 years, with Novartis having options to:! Extend to 12 years! Terminate after 7 years if certain technology goals are not met
Term
Company Update | January 2008 Page 16© MorphoSys AG
Partnered Programs in the Clinic
" HuCAL antibody vs. MHCII (HLA-DR) for relapsed and refractory lymphoma
" European phase 1 study at 3 sites, patient recruitment completed
" Antibody seems safe and well-tolerated
GPC Biotech: 1D09C3
" HuCAL antibody vs. amyloid-β for Alzheimer‘s Disease
" Europ. phase 1 study ongoing at 4 sites: randomized, double-blinded, in patients
" Results expected 2008 (MOR estimate)
Hoffmann-La Roche: R1450
" HuCAL antibody vs. undisclosed cancer target
" 3 years from start of project to IND
Novartis
" HuCAL antibody vs. undisclosed cancer target
" IND filing in June 2007
Undisclosed Partner
Company Update | January 2008 Page 17© MorphoSys AG
Business Segments
Research AntibodiesTherapeutic Antibodies
" Broad partnered pipeline maximizes number of resulting products, reduces risk profile
" Proprietary, un-partnered programs offer even greater upside
" New Novartis alliance secures partnered pipeline, will finance own product development
" Built by merging:
" Top 20 supplier of research antibodies
" Platform to increase uptake of HuCAL in research community
Company Update | January 2008 Page 18© MorphoSys AG
AbD Serotec: The Business
Research Antibody Market: US$ 1bn
Catalogue antibody business10,000 antibodies
Custom service businessUSP: MAbs in 8 weeks
Catalog:80% of market
Custom:20% of market
Research applications with novel targets seed new
HuCAL Rx and/or Dxopportunities
Company Update | January 2008 Page 19© MorphoSys AG
AbD Serotec: Gaining Scale
Launch Custom Service Antibodies by Design
200620042003 20072005
Acquisition of Biogenesis
Acquisition of Serotec
€0.8m
€4.3m
€18.3m
2004 2005 2006
Ranked No. 11 worldwide for customer recognition in BioCompare Survey
Company Update | January 2008 Page 20© MorphoSys AG
0.930.68Earnings per Share (diluted) in EUR
6.1*4.9Net Profit
1.22.9Income Tax Expense
7.4*7.8Profit Before Taxes
(0.3)0.9Non-Operating Income/(Expenses)
7.86.9Profit from Operations
31.237.2Total Operating Expenses
14.0
11.7
5.5
39.0
9-Months 2006
15.5S,G&A Expenses
15.7R&D Expenses
9-Months 2007In EUR millions
44.1Revenues
6.0Cost of Goods Sold
Profit & Loss Statement (Group)9-Months 2007
* Differences due to rounding
Company Update | January 2008 Page 21© MorphoSys AG
Condensed Balance Sheets (Group) 9-Months 2007
127.8*168.6*Total Liabilities100.1138.8Total Shareholders’ Equity
9.511.3Total Non-Current Liabilities18.3
127.851.710.1
66.0
12/31/2006
Liabilities18.4Total Current Liabilities
48.1Total Non-Current Assets168.6Total Assets
15.5Other Current Assets
09/30/2007In EUR millions
Assets
105.0Cash, Cash Equivalents & MarketableSecurities
* Differences due to rounding
Company Update | January 2008 Page 22© MorphoSys AG
Shareholder Structure
Novartis
AstraZeneca
Free Float
~ 7 %" Novartis
~ 5 %" AstraZeneca
~ 88 %" Free float
7,376,890Number of Shares Issued at September 30, 2007Frankfurt Stock Exchange
ISIN: DE0006632003
SE Code: MOR
Bloomberg: MOR GR
Company Update | January 2008 Page 23© MorphoSys AG
Forthcoming Events
" Update on proprietary development! MOR103 –CTA approval
! Upcoming phase 1 study for MOR103
! Update on MOR202 development plans
" Progress in partnered antibody pipeline! Maturing pipeline
! New INDs
! Clinical data from ongoing phase 1 programs
" Progress in proprietary technology development" Feb 28: 2007 results and guidance for 2008
Company Update | January 2008 Page 24© MorphoSys AG
New Deal is Transforming for MorphoSys
Value
Establish & patentcore technology
Commercialize viafee-for-servicepartnerships
Novartis alliance will:
" Drive further pipeline expansion
" Finance MOR‘sproprietary activities
Late 1990s Mid 2000s Present & Future
Thank You.
www.morphosys.com
Dr. Simon MoroneyChief Executive Officer
Phone +49 (0)89 / 899 27-311Fax +49 (0)89 / 899 27-5311Email [email protected]
Dr. Claudia Gutjahr-LöserHead of Corp. Comm. & IR
Phone +49 (0)89 / 899 27-122Fax +49 (0)89 / 899 27-5122Email [email protected]
HuCAL®, HuCAL GOLD®, CysDisplay®, RapMAT® and AutoCAL® are registered trademarks of MorphoSys AG