Member Info for Alquemie

Correction -should read "invoicing of licensee by manufacturer" and "licensees are generally in no hurry".

Agreed that either DBC management (or whoever was advising them) should have D- on their report card, although the problem is way more complex than the muppet factor. Yup, eyebrows still raised over Recordati shelling out early. Invoicing from licensor to manufacturer is not a usual milestone trigger, and licensors are generally in no hurry to acknowledge commercial sales if there is a cost attached (hence the "sample" and "test marketing" get outs). Any accounting advantage from a Group perspective? As for "multi-territory", I did say either single/two territory lead (Italy/Germany), or, "slo-mo" roll-out. Latter does now seem to be the case, with, so far Recordati Italy throwing it over the fence to an agency, a single limited circulation press release from Bouchara, nicht ein wurst from Recordati Germany (very strange, being the key market), and nothing from your local guys in Portugal. Only Casen Recordati seem to be on the ball, with a little survey, press release and nice looking professional monograph, might reflect their experience with the Virerec launch. But, other than Italy, no professional or consumer orientated digital presence. On the basis that there's clearly no tearing hurry on the promo front, I'm demanding a half-point on this. You've missed out part of the sentence for "Recordati walking"- what I said was "if the 12 dose presentation was not available.....",or something to that effect. RP did, Recordati didn't (although they did write down Fortacin due to the impact on sales). And Recordati did insist on lower COGS. I will stick with my prediction of Euro 10 to 20m peak sales, with the safe prediction that we will all be much, much older before then.

Surprised that Recordati ponied up from Group funds, since the national subsidiaries appear to be responsible for marketing costs and presumably individual agreement with local broad-line wholesellers. But, given RP's shafting under the updated agreement and that they are still carrying manufacture-associated development and regulatory costs, perhaps about time Recordati showed a little largess. Certainly no surprise over the lack of information on NDA "progress". No mention of the DBC founder resigning as a Director back in November, leaving two part-time JM sock puppets in place (although perhaps not considered relevant to RP's interest). And as the DBC are neither a sponsor nor exhibitor at the Malvern Diabetic Foot Conference in May (the largest international gathering of its type), I guess a name change to "Dead and Buried" is in order.

Pomander, I'm not alleging anything. I am stating that there is no record of a registered clinical study. I do not know of any set of circumstances under which an interventional study, particularly one pivotal to a NDA, might be conducted without prior registration in a recognised publicly accessible register. I understand your disgruntlement and can only suggest that you contact RP for an explanation.

Pomander. Many companies post estimated times to approval which prove to be wildly optimistic, although I can't think of any that have been consistently as wrong as RP. I understand your point but exhibiting poor judgement or being caught out by changing circumstance is not deception. To reiterate my own point, since no interventional clinical study has been registered, there is no possibility of keeping to the current timeline. Easy enough for you or any another poster to confirm by contacting RP.

Pomander, It's a simple statement of fact: no clinical study corresponding to any part of the SPA study ever been registered. The NIH and ICTRP databases are publicly accessible, easy enough to check study registration and status without technical knowledge. The only PRO-associated study (questionnaire validation, no dosing) in the public domain was the single centre (South Florida) study, listed from November 2015. To put the reliability of the timeline estimates in context, FDA approval has variously been given as "Q4 2015/Q1 2016" (April 2014); "Q1 2017" (November 2014); "Q2 2018" (March 2016), and currently "Q4 2019" (November 2016), all without a single subject being dosed.

Pomander, As you observed, and thanks to SOTRR's efforts, the MI presentation appeared to be more or less the same as in previous presentations. I'd assumed the NDA submission dates were errors carried over from past years, hence my comment on the impossible timeline. Not sure where you're getting the "glee" vibe from. The MI timeline looks to be unchanged from that given in the November 2016 presentation, with the Part I read-out flagged as Q1 2018. However, a check of the NIH Clinical Trials database or the WHO ICTRP confirms that no corresponding clinical study has ever been registered in the US (or any other country). Call me a simple soul, but I take this as a reasonable basis for stating that there ain't no data comin' no time soon. I'm assuming that, being so close to the AR publication, there's no point in contacting RP for clarification. History suggests that enlightenment with respect to the elastic nature of the US approval timeline may not be forthcoming. And if Dr Mike is an avid reader and believes he knows me, he's most welcome to get in touch (number and direct email on the "Who We Are" page of the website, early closing Friday) and point out the error of my ways.

Has to be- time from NDA submission to decision is 12 months (60 day validation, then 10 month PDUFA review), so either the given quarters are wrong, or they mean "acceptance", not "submission". You would need to submit first working day January 2019 to be sure of a decision before year end. Anyway,all moot since a US clinical study has yet to be registered and we're racing towards the end of March 2018.

Thanks, Pomander....another of the many uncorrected typos in the RP presentations. Will be interesting to learn what the revised timeline looks like. I'm aware that something clearly happened concerning the PEBEQ between the time of Dr W's submission to the Sexual Medicine Society of North America October meeting and December, presumably after the face to face with the FDA. I'm speculating, but this might not be down to any fault on RP's part but a consequence of implementation of the 21st Century Cures Act (Section 507) and the introduction of a new qualification process and criteria for PROs and other drug development tools. There's a planned "transition phase", for pre-Section 507 submissions, still trying to understand the general impact of this.

SOTRR, thank you for taking the trouble to post on MI. If only my colleagues were as diligent in their after-conference reporting! Can you confirm that Slide 3 gives the estimated NDA submission date as Q1/Q2 2019, with anticipated approval Q4 2019? A clearly impossible timeline, but is this is a typo on RP's part or a transcription error?

Fortacin (or lidocaine-prilocaine spray Plethora as it was then catchily titled) was deemed "non prescribable" by a number of CCG/MMGs and the All Wales Medicines Group even before it was launched. More recently, it's been "black lighted" - "not commissioned or endorsed" (CCG's use a traffic light system to differentiate drugs with and without prescribing restrictions). Dapoxetine is likewise "black". Cost relative to off-label treatments is an issue, but as summarised in the authoritative Drugs and Therapeutics Bulletin (April 2017), there is no comparator data on which to base a cost-benefit decision, no long-term safety data, no data representative of "real world" treatment populations and questions around study design and interpretation (but, to put this in context, many drugs are launched with comparable gaps in the data). Any change in the commissioning decision depends upon a positive NICE evaluation, but given the low priority assigned to PE treatment by the NHS (and the time required to generate meaningful data for Fortacin), this is years away, if ever. To echo Pomander's point, the UK has never been part of Recordati's game plan. It's simply not worth the effort of maintaining even an arm's length presence and PV responsibility for a handful of private Rx. The "6 min versus 3 min" references a recently published meta-analysis of topical treatments. Objectively, EMLA results in longer prolongation of IELT over Fortacin (both relative to placebo). I'd add the important rider that there are only a small number of well controlled and designed PE studies to draw from and that differences in IELT may not necessarily translate into "real life" patient (or partner) satisfaction.

"Official" launch by Casen Recordati today, wholesale price of Euro 37, estimated out of pocket cost of around Euro 52 (assuming wholeseller and pharmacy margins are fixed for non-reimbursed Rx products).

Closing down D4U sales is all to do with positioning and branding. Recordati are pushing the medical specialist/differential diagnosis aspect to distance Fortacin from common or garden knob sprays: online distance prescribing and D4U's tabloid infomercials and deep discounting run counter to the message Recordati have no promotional resource in the UK and without NHS endorsement there's simply no return in maintaing sales in the UK. Dapoxetine, despite NICE assessment and some attempt at both professional and punter promotion and with screeds of real world usage data has never managed to gain NHS traction: NHS England expenditure on dapoxetine was just over GBP 181,000 in 2016.

Pomander, Sadly, not associated with CEL Pharma in any way, other than knowing several of their associates socially and professionally. My teaching these days is pro bono, although I have done industry and institutional gigs in the past and still publish the odd academic paper. Thank you for pointing out that my estimates are entirely independent of those made by RP/PLE and their advisers. And, for the benefit of the hard of thinking, the key point of differentiation is that my inputs and assumptions are based on peer-reviewed third-party publications in the public domain, fully verifiable and transparent. The methodology is essentially the same as I use for professional work (pharma, general and specialist investors), minus the Monte Carlo/real options/decision tree/KOL interview ******, which nobody reads or understands. But, as long as they pay for it...... Sources available on request. Two points relevant to your own analysis: First, I was wrong about the tiered royalty triggers, which are annual net sales, not, as I'd stated, aggregate sales. The triggers appear to set lower in the restated agreement, although difficult to be certain from JG's opaque wording. Second, in the original agreement, the commercial milestones comprise more than 50% of the headline value, yet, if you lay out a simple DCF as I think you have already done, they add only a very small percentage to the RP share of the value split. I'm not accusing RP of doing anything that's not commonplace in licensing, but I do suspect that, given the weakness of their negotiating position, they were happy to take anything that put a polish on the apple. If the commercial milestones were intended to contribute to the value split, the aggregate sales triggers would not have been set at such absurdly high levels.

Pomander, Euro 5m and Euro 20m commercial milestones and the aggregate triggers you reference are as in the original 2015 agreement. Personal experience only, but I've never heard of a licensee ever pitching numbers- licensing is always a selling exercise. RP/Pharmalicensing would have presented sales projections to support draft terms, Recordati would have had a good belly laugh and pushed back. It's common knowledge that RP were down to the dregs of their half-pint shandy while standing at the bar of Lucky Recordati's Last Chance Saloon. I remember plugging the deal terms into a little model I use to calculate value split. Best fit was for a rNPV deal value of around Euro 100m, giving RP just under 20%. The commercial milestones were so small and far out that they had almost no impact on the split, and that the Euro 20m trigger would never be triggered during the term of the agreement. I strongly suspect they were added in as a face-saver to up the headline value. In the restated agreement, total commercial milestones are reduced to Euro 15.6m, with presumably more realistic triggers: my guess would be something like Euro 2.6m at aggregate sales of Euro 50m and Euro 13m at Euro 200-250m. Perhaps unfair to expect Dr W to have a grasp of sales projections and agreement details, not easy to give an investor presentation when you have someone else's numbers to work with.

This is lifted from a Recordati licence agreement: �Net Sales� shall mean the gross amount invoiced by Recordati, an Affiliate or a Sublicensee on sales of Products to a Third Party less deductions for (i) trade, cash and quantity discounts (including early payment cash discounts), (ii) returns, rejections and recalled Product, (iii) rebates and allowances, chargebacks, retroactive price reductions actually allowed or granted to any public or private purchaser or reimburser including managed care organizations, (iv) rebates, paybacks and discounts imposed by the competent authorities as well as rebates, paybacks and discounts imposed by the competent authorities as an effect or a condition for maintaining the reimbursement status of the Product, (v) excise, sales or use taxes, value added taxes and other tariffs or duties levied on the sale, transportation or delivery of Products to the extent reflected in the gross amount invoiced, and (vi) freight, insurance and other transportation charges. All of such foregoing deductions shall be calculated in accordance with International Financial Reporting Standards (IFRS) or other similar accounting methods as mutually agreed upon by the Parties, and on an accrual basis of accounting. Net Sales shall not include the distribution of a Product for promotional samples, clinical studies, compassionate use, named patient programs, test marketing, or any similar instance. In the case of any sale or other disposal of a Product between or among Recordati and its Affiliates or its Sublicensees, for resale, Net Sales shall be calculated only on the value charged or invoiced on the first arm�s-length sale thereafter to a Third Party.

Got to hand it to him, he still talks a good game. I still remember his quote when Antisoma's Phase III cancer study went mammaries skywards- ""We need to look at what is the best way to deliver value to all shareholders with the new hand of cards we've been dealt," At least one Joker in that hand, for sure. Comedy gold....

Pomander, royalties are always based on net revenue returning to the licensee. The retail price will include the pharmacy and wholeseller mark-up and VAT. The mark-up is fixed on prescription drugs in most, but not all countries, and may be significantly higher when the product is not reimbursed (Italy and Portugal, for example). Tiered royalties are a mechanism to compensate for revenue generation outside of the range used as the basis for value-splitting within a licence agreement. Triggers are either aggregate sales or levels of annual sales. Looking at the structure of the Recordati agreement (and knowing who drafted it), I'm sure that the trigger is aggregate sales, as is the case for the commercial milestones. I seem to recollect the aggregate triggers in the orginal agreement as being absurdly high.

Pomander, I teach forecasting as part of a BD and licensing workshop (academic start-up orientated) and have a slide featuring JK Galbraith's quote ""We have two classes of forecasters: Those who don�t know�and those who don�t know they don�t know." Pharma forecasting is perhaps easier than some disciplines but definitely as much art as science involved. Laziness made me set the Fortacin error bars at the industry average for pharma peak sales estimates (+/- 40%), might be fooling myself, but for a niche product, I'm pretty confident my spread is less , say Euro 12m to 20m peak sales. I don't follow SUMM that closely, but having known the CEO for more than 20 years, let's just say I have reservations with respect to strategy and delivery (anyone remember Antisoma?).

Pomander, that's not a bad stab at all. Where our methodologies differ is in your the use of lifetime prevalence rather than the % men currently experiencing PE (the "point prevalence"), and my % Tx seeking is on a population basis. However, your Tx seeking estimate (1% of men experiencing PE at any time) is lower than mine (1% of the population), which cancels the prevalence overestimate. If you want to re-run your model for the Recordati core territories, may I suggest the following inputs and assumptions: Adjust the population for adults males (18-64 years)- France (18.9m); Germany (24.9m); Italy (18.4m); Spain (15m), and Portugal (3.3m), to give 80.5m in total. A 30% market share is a tad high: between patients opting for non-drug or no treatment, and around 30% presenting with ED in addition to PE, only around 40-50% of treatment seekers are available for drug Tx, split between oral and topical meds (although with some overlap and switching at second line). Fortacin will, to some degree, replace off-label (reimbursed or low cost) topicals, but since there is a significant out of pocket expense, A 15% share of pharmacotherapy (50% of all topical Rx) is probably achievable. I'm comfortable with each Rx lasting two months (well, until users realise that a 5ml canister delivers way more than 12 doses), but your average of six cans per year is optimistic. Few non-essential drugs have anything close to 100% adherence. Out of pocket drug cost, including pharmacy and wholeseller fees will be around Euro 60-65, but Recordati's take is the wholesale price (minus any wholesaler discount), and the net price for royalty purposes will be around Euro 35-45. Plugging in my working discontinuation rate, net price of Euro 40 per Rx, and a 15% Tx share returns peak sales of Euro 16.5m, with a range of Euro 10m and Euro 23m allowing for the usual error in any pre-launch/early phase valuation. The investment case is a whole different debate, although with RP receiving only a modest return from Recordati, there is a reliance on additional, harder to access revenue streams, thereby upping risk.