SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): September 17, 2002
(September 17, 2002)
ENDO PHARMACEUTICALS HOLDINGS INC.
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(Exact name of registrant as specified in its charter)
DELAWARE 39040 13-4022871
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(State or other (Commission File Number) (I.R.S. Employer
jurisdiction of Identification No.)
incorporation)
100 Painters Drive
Chadds Ford, Pennsylvania 19317
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(Address of principal executive offices) (Zip Code)
(610) 558-9800
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(Registrant's telephone number, including area code)
N/A
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(Former name or former address, if changed since last report)
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired.
Not applicable.
(b) Pro Forma Financial Information.
Not applicable.
(c) Exhibits.
Exhibit Number Description
99.1 Slide Presentation of Endo Pharmaceuticals Holdings Inc.
dated September 17, 2002
Item 9. Regulation FD Disclosure.
On September 17, 2002, the Registrant intends to make a slide
presentation at the Bear Stearns 15th Annual Healthcare Conference in New York,
New York, a copy of which presentation is filed herewith as Exhibit 99.1 and is
incorporated herein by reference.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
ENDO PHARMACEUTICALS HOLDINGS INC.
(Registrant)
By: /s/ CAROL A. AMMON
-----------------------------------------
Name: Carol A. Ammon
Title: Chairman & Chief Executive Officer
Dated: September 17, 2002
INDEX TO EXHIBITS
Exhibit No. Description
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99.1 Slide Presentation of Endo Pharmaceuticals Holdings Inc.
dated September 17, 2002
Exhibit 99.1
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COVER SLIDE
[ENDO LOGO]
Endo Pharmaceuticals
Bear Stearns
15th Annual Healthcare Conference
September 17, 2002
SLIDE 1
Forward-Looking Statements
==============================================================================
This presentation contains forward-looking statements, within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, as amended, that are based on management's beliefs and
assumptions, current expectations, estimates and projections. These statements
are subject to risks and uncertainties and, therefore, actual results may
differ materially from those expressed or implied by these forward-looking
statements. Forward-looking statements are not historical facts and include
information regarding the Company's possible or assumed results of operations.
Also, statements or expressions that are preceded by, followed by, or that
include, the words "believes," "anticipates," "plans," "expects," "intends,"
"estimates" or similar expressions are forward-looking statements. Endo's
estimated or anticipated future results, product performance or other
non-historical facts are forward-looking and reflect Endo's current
perspective on existing trends and information. Many of the factors that will
determine the Company's future results are beyond the ability of the Company
to control or predict. The reader should not rely on any forward-looking
statement. The Company undertakes no obligations to update any forward-looking
statements whether as a result of new information, future events or otherwise.
Several important factors, in addition to the specific factors discussed in
connection with these forward-looking statements individually, could affect
the future results of Endo and could cause those results to differ materially
from those expressed in the forward-looking statements contained herein.
Important factors that may affect future results include, but are not limited
to: the Company's ability to successfully develop, commercialize and market
new products; results of clinical trials on new products; competition for the
business of the Company's branded and generic products, and in connection with
the Company's acquisition of rights to intellectual property assets; market
acceptance of the Company's future products; government regulation of the
pharmaceutical industry; the Company's dependence on a small number of
products; the Company's dependence on outside manufacturers for the
manufacture of its products; the Company's dependence on third parties to
supply raw materials and to provide services for the core aspects of its
business; new regulatory action or lawsuits relating to the Company's use of
narcotics in most of its core products; the Company's exposure to product
liability claims and product recalls and the possibility that the Company may
not be able to adequately insure itself; the Company's ability to protect its
proprietary technology; the Company's ability to successfully implement its
acquisition strategy; the availability of controlled substances that
constitute the active ingredients of some of the Company's products and
products in development; the availability of third-party reimbursement for the
Company's products; the Company's dependence on sales to a limited number of
large pharmacy chains and wholesale drug distributors for a large portion of
its total net sales; and other risks and uncertainties detailed in Endo's
Registration Statement on Form S-4 filed with the Securities and Exchange
Commission on June 9, 2000, as amended, and in Endo's Registration Statement
on Form S-3 dated October 17, 2001. Readers should evaluate any statement in
light of these important factors.
SLIDE 2
Profile
==============================================================================
o Endo is a specialty pharmaceutical company engaged in the research,
development, sale and marketing of branded and generic prescription
pharmaceuticals used primarily to treat and manage pain
o Endo will leverage its strengths to capture growth opportunities in the
rapidly growing pain management market and other complementary areas
SLIDE 3
Company History
==============================================================================
______
| 1920 | o Endo founded
| |
| 1950 | o Percodan(R) launched
| |
| 1969 | o Endo sold to DuPont
| |
| 1971 | o Percocet(R) launched
| |
| 1997 | o Management buyout of Endo from DuPont Merck
| |
| 1998 | o Lidoderm(R) licensed from Hind Healthcare
| |
| 2000 | o Endo goes public; Algos acquired
| |
| 2001 | o October: Follow-on offering completed
|______|
SLIDE 4
Aggressive Pain Focus
==============================================================================
o Pain Management is a tremendous growth area:
- Compounded growth rate of >28% annually
- Pain community is extremely aggressive
- Prescribing physician base highly concentrated
SLIDE 5
Total Prescription Pain Market
==============================================================================
Bar Chart Reflecting Data Below:
1998 1999 2000 2001
---- ---- ---- ----
Sales (billions) $6.8 $9.3 $11.9 $14.3
Graph Shows a Compounded Annual Growth Rate of 28%
Source: IMS
SLIDE 6
Key Drivers of Market Growth
==============================================================================
o Changing attitudes toward pain management
> Physicians
> Patients
o Changing environment toward treatment of pain
> Guideline changes
> Pain management now recognized as a board certified specialty
o Favorable demographics
> Aging population
o Increase in number of surgical procedures
SLIDE 7
Analgesics: 2001 the second most prescribed medication
==============================================================================
2000 2001
1. Vascular agents 1. Anti-infectives
2. Psychotherapeutics 2. Analgesics
3. Anti-infective 3. Psychotherapeutics
4. Analgesics 4. Vascular agents
5. Hormones 5. Hormones
6. Respiratory Therapy 6. Respiratory Therapy
7. Gastrointestinal 7. Cough/Cold Preps
8. Anti-arthritics 8. Anti-arthritics
9. Diuretics 9. Gastrointestinal
10. Diabetes Therapy 10. Cholesterol Reducers & Lipotropics
Narcotics comprise approximately Narcotics comprise approximately
75% of analgesic prescriptions 76% of analgesic prescriptions
Source: IMS Prescription Data
SLIDE 8
Narcotic Analgesics
==============================================================================
Bar Chart Reflecting Data Below:
1998 1999 2000 2001
---- ---- ---- ----
Sales (billions) $1.6 $2.1 $2.7 $3.6
Graph Shows a Compounded Annual Growth Rate of 31%
Source: IMS
SLIDE 9
Endo's Products Address the Pain Continuum
==============================================================================
----------------------------------------------------------------
| Mild | Moderate | Moderately | Severe |
| | | Severe | |
- --------------------------------------------------------------
Marketed Lidoderm(R) Percocet(R) Numorphan(R)
Products Nubain(R) Percodan(R) Percolone(R)
Zydone(R) Endocet(R) Hydromorphone
Endodan(R) Morphine ER
Pipeline HydrocoDex(TM) PercoDex(TM) MorphiDex(R)
Products Oxymorphone IR/ER
OxycoDex(TM)
Oxycodone ER
SLIDE 10
Endo's Pain Management Product Offering
==============================================================================
o Established Portfolio of Branded Products:
> Percocet(R)
> Lidoderm(R)
> Other established brands including:
- Percodan(R)
- Zydone(R)
o Difficult-to-Develop Generics:
> MS Contin generic
> Oxycontin generic
- subject of litigation
- tentative approval granted by FDA July 2002
SLIDE 11
Established Portfolio of Brands: Percocet(R)
==============================================================================
________
| |
| 1971 | o Percocet(R) 5.0/325 launched
| |
| 1999 | o Endo launches new strengths of Percocet(R)
| |
| 2001 | o April 2001 - Generics of 7.5/500 and 10.0/650 introduced
| |
| 2001 | o November 2001 - New strengths approved and launched:
| |
| | > Percocet(R) 7.5/325 and Percocet(R) 10.0/325
| |
|________|
"Gold Standard"
in pain
management
SLIDE 12
Percocet(R) Prescriptions
==============================================================================
Line Graph Reflecting Data Below:
1994 1995 1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ---- ---- ----
Prescriptions 2.0 1.8 1.6 1.4 1.4 1.3 2.0 2.2
(millions)
Source: IMS
SLIDE 13
Percocet(R) Net Sales
==============================================================================
Bar Chart Reflecting Data Below:
1999 2000 2001 1H 2001 1H2002
---- ---- ---- ------- ------
(in millions) $51.5 $92.4 $101.0 $56.4 $64.1
SLIDE 14
Established Portfolio of Brands: Lidoderm(R)
==============================================================================
o First FDA-approved drug for the treatment of post-herpetic neuralgia
(PHN), a form of neuropathic pain
o Herpes Zoster ("shingles") afflicts ~ one million patients annually
o Approximately 70% experience some pain:
> Acute
> Chronic (PHN)
o PHN occurs in about 20% of shingles patients
o Lidoderm(R) provides analgesia
SLIDE 15
Lidoderm(R) Prescriptions
=============================================================================================
Line Graph Reflecting Data Below:
Quarter Ended
Mar-00 Jun-00 Sep-00 Dec-00 Mar-01 Jun-01 Sep-01 Dec-01 Mar-02 Jun-02
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Prescriptions 28 39 49 60 68 81 96 119 139 170
(thousands)
Source: IMS
SLIDE 16
Lidoderm(R) Net Sales
==============================================================================
Bar Chart Reflecting Data Below:
1999 2000 2001 1H 2001 1H 2002
---- ---- ---- ------- -------
(in millions) $5.7 $22.5 $40.9 $10.7 $ 35.8
SLIDE 17
Sales by Product
==============================================================================
Bar Chart Reflecting Data Below:
1998 1999 2000 2001
----- ----- ----- -----
(in millions)
Generics $33.7 $44.8 $47.1 $ 84.3
Other Brands $30.1 $36.5 $35.4 $ 25.8
Lidoderm(R) $ 0.0 $ 5.7 $22.5 $ 40.9
Percocet(R) $44.6 $51.5 $92.4 $101.0
----- ----- ----- ------
$108.4 $138.5 $197.4 $252.0
Graph Shows a Compounded Annual Growth Rate of 33%
SLIDE 18
Targeted Sales and Marketing
==============================================================================
o Direct marketing through national dedicated sales force:
> 160 community-based field representatives (contract)
> 70 specialty institutional representatives (internal)
o Focus on high-prescribing physicians in:
> Pain management
> Surgery
> Oncology
> Primary care
SLIDE 19
Management Expertise
==============================================================================
o Average of approximately 20 years of experience in the pharmaceutical
industry
o Senior leadership instrumental in buy-out from DuPont Merck and
formation of independent company
o Proven track record
> Have received FDA approval on more than 15 new products and product
extensions since 1997
SLIDE 20
R&D Expertise
==============================================================================
o Core expertise in narcotic analgesics
> Pipeline products launched in the past four years contributed 54%
of 2001 net sales
o Four NDA products in Phase III and three NDA products in Phase II
clinical trials
o Successful and proven record with the FDA
SLIDE 21
Substantial Pipeline
==============================================================================
Key Pipeline Products Branding Development stage
--------------------- -------- -----------------
MorphiDex(R) Branded Phase III
Oxymorphone ER Branded Phase III
Oxymorphone IR Branded Phase III
Immunol(TM) Branded Phase III
HydrocoDex(TM) Branded Phase II
OxycoDex(TM) Branded Phase II
PercoDex(TM) Branded Phase II
Oxycodone ER Generic Tentative FDA approval;
subject to litigation
SLIDE 22
MorphiDex(R) (morphine + dextromethorphan)
==============================================================================
o Dextromethorphan enhances morphine analgesia
o Pivotal chronic dosing study previously completed
- "Morphine sparing"
- "Longer duration of pain relief"
o Long-term clinical experience: Safety established
In response to Algos' "not-approvable" letter:
o Multiple-dose Phase III studies in chronic pain underway
SLIDE 23
MorphiDex(R) (morphine + dextromethorphan)
==============================================================================
o Multiple dose Phase III studies in chronic pain
> three-month treatment period
> 200-300 patients per study
> primary objective:
- morphine sparing (2 studies)
- superior analgesia (1 study)
> secondary objectives:
- define lowest fixed-dose MS/DM ratio (1 study)
- "tolerance" (3 studies)
o First study (announced 6/24/02) did not meet primary or secondary
endpoint
o Anticipate announcement of results from second and third studies
in Q4 2002
SLIDE 24
Oxymorphone ER/IR
==============================================================================
o Pure opioid agonist; marketed in U.S. since 1960 as injection
and suppository
o New oral extended and immediate release formulations
> ER version co-developed with Penwest Pharmaceuticals
o First "new" opioid in decades
o Efficacy demonstrated
> 1,500+ cancer and non-cancer patients in clinical program
o Abstracts presented at 2002 World Pain Congress in August
o Currently expect to file NDA applications in second half of 2002
SLIDE 25
Historical Financial Summary
==============================================================================
Bar Chart Reflecting Data Below:
1999* 2000* 2001
------ ------ ------
(in millions)
Net Sales $138.5 $197.4 $252.0
Gross profit $ 80.3 $134.4 $177.1
Consolidated EBITDA** $ 27.7 $ 62.1 $ 79.5
* Pro-forma for Algos acquisition.
** Excludes non-cash COGS.
SLIDE 26
YTD June Financial Summary
==============================================================================
Bar Chart Reflecting Data Below:
1H 2001 1H 2002
------- -------
(in millions)
Net Sales $ 107.2 $ 174.9
Gross profit $ 73.6 $ 128.2
Consolidated EBITDA (1) $ 31.1 $ 60.9
(1) Excludes non-cash COGS.
SLIDE 27
Projected Financial Summary
==============================================================================
Bar Chart Reflecting Data Below:
2001 2002E 2001 2002E
------ ------ ----- -----
(in millions) (in millions)
Net Sales $252.0 $350.0 Consolidated EBITDA* $79.5 $125.0
* Excludes non-cash COGS.
SLIDE 28
Recent Developments
==============================================================================
o Added new Phase III pipeline product through acquisition of BML
Pharmaceuticals
> prescription oral rinse for management of oral mucositis
o Internalized specialty sales force
> strengthens our sales capabilities
> reflects continuing strength of Lidoderm(R) and Percocet(R)
o Announced tentative FDA approval for Oxycodone Extended Release Tablets
> final approval contingent upon favorable litigation outcome
o Amended manufacturing agreement with BMS
> ensures smooth transition to Novartis Consumer Health
o Repaid BMS Promissory Notes
> strengthens balance sheet - debt free
SLIDE 29
Proven Track Record
==============================================================================
|---------------------------------------| |-----------------------------------|
| Strategy | | Achievement |
|---------------------------------------| |-----------------------------------|
o Leverage brand equity of products |X| Launched new strengths of
Percocet(R) in November 1999
and November 2001
o Line extensions |X| Launched Zydone(R) in
February 1999
o Develop difficult generics |X| Only AB-rated generic of all
five strengths of MS Contin(R)
on the market
|X| First to file 10, 20 and 40 mg
generic version of Oxycontin(R)
o Acquire products in pain management |X| Launched Lidoderm(R) for PHN
and related areas in September 1999
|X| Immunol in late-stage
development
SLIDE 30
2002 Expected Milestones
==============================================================================
o Completion of our second and third Phase III clinical studies on
MorphiDex(R)
o File NDAs for extended-release and immediate-release oxymorphone
o Continue to advance future product line through:
> Advancement of other pipeline projects
> Acquire and in-license complementary products, compounds
and technologies
SLIDE 31
Summary
==============================================================================
Endo is well positioned to capture profitable growth in the fast-expanding
pain management market through our:
|X| Established portfolio of branded products
|X| Targeted national sales and marketing infrastructure
|X| Experienced, successful management team
|X| Research and development expertise
|X| Substantial pipeline
|X| Strong financial position
END SLIDE 32
[ENDO LOGO]
Endo Pharmaceuticals
(Nasdaq: ENDP)