Halozyme Therapeutics, Inc. (HALO) Q2 2013 Earnings Report, Transcript and Summary

Ladies and gentlemen, welcome to the Antares Second Quarter 2013 Operating and Financial Results Conference Call. [Operator Instructions] I will now hand the conference over to Jack Howarth, Antares Vice President of Corporate Affairs. Please go ahead, sir.

Thank you, George, and good morning, everyone. Thank you for joining us on today's call. We announced second quarter 2013 operating results and achievements earlier this morning, and the press release can be found on the Antares website at www.antarespharma.com under the Investor Relations tab. Before we begin, please be advised that during the course of this call, we may make forward-looking statements concerning the company that are not historical facts. These forward-looking statements may include, but are not limited to, statements concerning the timing of product sales, market estimates, market potential and growth prospects, technology platforms and working capital needs. In addition, the OTREXUP, QuickShot testosterone and VIBEX epinephrine products referred to on today's call have not yet been approved by the FDA. Forward-looking statements provide Antares' current expectation or forecast of future events. Actual results could differ materially from those reflected in these forward-looking statements due to decisions of regulatory authorities and Antares' ability to execute on its development plans, capital needs and general financial, economic, regulatory and political conditions affecting the pharmaceutical industry generally. Additional information concerning these risks and uncertainties are contained in the Risk Factors section of Antares' annual report on Form 10-K and in Antares' periodic filings and other filings made with the Securities and Exchange Commission. Antares is providing this information as of the date of this release and does not undertake any obligation to update any forward-looking statements contained in this earnings call as a result of new information, future events or circumstances after the date hereof, except as required by law or otherwise. The company cautions investors not to place undue reliance on these forward-looking statements. Joining me on the call today are Dr. Paul Wotton, President and Chief Executive Officer; Robert Apple, Chief Financial Officer and President of the Parenteral Products Group; and Leroux Jooste, Senior Vice President, Pharmaceutical Sales and Marketing. After the presentation, we will open the lines for Q&A. I'll now turn the call over to Paul Wotton. Paul?

All right. Thanks, Jack, and good morning, everyone. As you can see from today's announcements, we've had an extremely active second quarter. And whilst there's been much progress made on many fronts, let me start with an update on the launch plans for OTREXUP, which is the primary focus of our activities at the companies right now. First and foremost, we've built out our in-house commercial organization successfully by recruiting a highly qualified 8-person marketing and sales team. And to give you some idea of the type of talent we have attracted between Leroux Jooste and his team, all of whom have big pharma backgrounds in commercializing rheumatology-specific biological products such as Enbrel, Cimzia and Orencia, we have over 100 years of combined sales and marketing experience in launching, marketing and selling pharmaceutical products, as well as dealing with managed care markets and third-party payers. Leroux, himself, has overseen or directly participated in the launch of several successful brands, including Enbrel, Prozac, Effexor XR, Ceclor, Gemzar, as well as several others. In addition to the in-house team, we've engaged 6 national account managers through our agreement with Quintiles, the world's largest provider of commercial outsourcing services that has played a role in developing or commercializing the top 50 selling drugs on the market. And they've already met with third-party players -- payers. At this point, we're in the process of engaging 6 medical science liaison professionals who will begin implementing the sales force activity with approximately 25 personnel later in the fourth quarter. As we get closer to the potential launch of OTREXUP, we also grew our Board of Directors by recruiting 2 highly skilled and respected individuals in Marvin Samson and Robert Roche, Jr. Marvin was formerly Group Vice President of Worldwide Injectables at Teva, having founded Sicor, amongst other successful companies. He has many years of extensive global commercial expertise in injectable manufacturing and delivery systems. His industry experience and contacts will be invaluable to us as we launch new products and add to our pipeline. Bob Roche led the commercial operations at Cephalon before his retirement in 2010 as Executive Vice President, Worldwide Pharmaceutical Operations, in which capacity, he oversaw the launches of several successful new products. And we're obviously pleased to welcome both Marvin and Bob to the board and look forward to their input during this next 5-year growth period for the company. The commercial team recently participated in the European League Against Rheumatism, or EULAR, conference this past June. It's the largest rheumatology conference in Europe. A presentation by Dr. Mike Schiff, the lead investigator, showed the subcutaneous self-administered methotrexate using the VIBEX Medi-Jet device demonstrates a significantly greater bioavailability over the current standard of care or methotrexate in rheumatoid arthritis patients. The poster session was well attended and generated a lot of interest in our innovative product. The fact that the poster was accepted for presentation at a conference as prestigious as EULAR, again, validated our belief that subcutaneous methotrexate does give rheumatologists the ability to optimize the use of methotrexate in the continuum of treatment for immune disorders like rheumatoid arthritis and patients can potentially derive greater efficacy from weekly self-injections. On the product development side, we've successfully manufactured the validation batches of OTREXUP, which we'll be able to use for the launch of the product. We also had a good mid-cycle review with the FDA and continue to have positive interactions with the agency. Now moving on to another significant milestone, we announced back in April the first shipment to Teva of epinephrine VIBEX auto-injector devices. We are pleased with the progress we have made with respect to our broad partnership with Teva, which continues to grow. And we expect to be able to report some additional program from our work together in the not-too-distant future. The experience we have gained while successfully scaling up and making VIBEX devices for Teva is directly applicable to the commercial manufacture of the OTREXUP device itself. An enormous amount of effort and focus has been directed towards the OTREXUP launch, but that's not the only thing we are working on as we continue to build on our pipeline strategy. We view our intellectual property as a valuable asset, and we'll continue to actively protect the enhanced device technologies that are being applied to both established and new drugs. Over the past 18 months, we have filed 43 patent applications and received 9 new patents. In late June, we announced that the U.S. Patent Office had issued patent number 8,480,631 entitled Hazardous Agent Injection System for OTREXUP. This patent includes product and method of use claims, including, but not limited to, claims directed towards an injection system for methotrexate and also a method for treating rheumatoid arthritis and other autoimmune diseases using an auto-injector or similar device for subcutaneous delivery of methotrexate. This is a key patent for us. The new patent will provide nearly 17 years of intellectual property protection for OTREXUP. And this patent issuance was a major milestone in our long-term strategy to create comprehensive intellectual property around all of our pipeline candidates, including OTREXUP. This patent is just one of the number of applications we filed overseas addressing the use of an auto-injector platform in combination with a wide range of product candidates, including QS T, which uses the new QuickShot device. The new QuickShot design accommodates fast subcutaneous injection of highly viscous drug products through a fine gauge needle that can easily stall less powerful, conventional auto-injectors. As you may know, many self-injector products currently marketed and in clinical development are formulated to be administered in a 1 mil dose and tend to be of higher viscosity. The QS device is designed to address this growing market need, and I'm pleased to announce that we just received a new patent number 8,496,619 from the USPTO for this device. I'm happy to report that our increased strategic investment for intellectual property protection is producing results such as this since a broad intellectual property base is integral to the success of a company such as Antares. And since we're on the topic of QS T, while we await the FDA's decision on OTREXUP, we've accelerated the development of the QuickShot testosterone program and expect to initiate dosing of the first patients in the clinical study during the third quarter. Based on our own market research, we still believe that this is a big opportunity for our company and continue to plan towards a 2016 launch, pending FDA approval. We're genuinely excited about this product because it will fill a real gap in the market for proprietary self-administered testosterone product that should avoid potential environmental and safety issues such as transference apparently seen with the gels. Unlike alternative doses forms, which can be as much as 90% inefficient in getting the dose to where it needs to be and given on a daily basis, our QS T is designed to discreetly give the right amount of testosterone at the right time with 100% dosage efficiency in a matter of seconds and dosed just once a week. It's a good example of the Antares value proposition. And as we progress, you can expect to see much more such opportunities emerging from our pipeline. I'll now turn the call over to Bob to discuss the second quarter results. After Bob is finished, I'll return to close out the call with some final thoughts. Bob?

Thanks, Paul. Good morning, everyone. Before I go over the results, I think it's important to know that we are in a process of significant change in growth at Antares. We have moved from a development and royalty-based company to one which not only is developing unique products such as OTREXUP and QS T, but we are also expanding our operations to include sales and marketing. We have made significant progress on this front, but importantly, continue to deliver revenue from our development and device work from our partners such as Teva. We have been able to effectively focus on both aspects of our business and still deliver on growth and effective utilization of our resources, both financial and people. I believe our Q2 results reflect this. Total revenues were $5.8 million and $4.5 million for the 3 months ended June 30, 2013 and 2012, an increase of 29%. For the 6 months ended June 30, 2013, the company's total revenue was $10.4 million compared to $11.4 million in the first 6 months of 2012. Product sales were $4.5 million in the second quarter of 2013 compared to $3.2 million in 2012, an increase of 41%. For the 6 months ended June 30, 2013, product sales increased 23% to $7 million compared to $5.7 million in the prior year. The product sales increases were primarily due to sales to Teva of prelaunch quantities of our VIBEX auto-injector for Teva's generic auto -- epinephrine auto-injector product. Development revenues were $600,000 in the 3-month period ended June 30, 2013 compared to $700,000 in the prior period. For the 6 months ended June 30, 2013, the company's development revenue was $1.4 million compared to $3.7 million in the first 6 months of 2012. The revenue in the first half of 2013 was primarily due to auto-injector and pen-injector development work for Teva. The revenue in the first half of 2012 was primarily due to a non-recurring FDA approval milestone of $2.5 million recognized in connection with our license agreement with Actavis, along with development revenue from Teva. License revenues were $100,000 in each of the 3-month periods ended June 30, 2013 and 2012. For the first half of 2013, licensing revenues were $100,000 compared to $700,000 in the first half of 2012. The licensing revenue in the second quarter and the first 6 months of 2013 was primarily due to recognition of revenue under our agreements with Ferring. The licensing revenue in the first 6 months of 2012 was primarily due to an upfront license fee received in connection with our licensing agreement with Daewoong Pharmaceuticals for our 3% oxybutynin gel for South Korea signed in January of 2012, along with license revenue recognized in connection with our Gelnique license agreement with Actavis. Royalty revenues were $7,000 in the 3-month period ended June 30, 2013 compared to $500,000 in the same period prior year. For the 6-month period ended June 30, 2013 and 2012, royalty revenues were $1.8 million and $1.2 million, respectively. We received royalties from Teva and Ferring related to their hGH business; from Actavis on sales of Gelnique; and from Meda Pharma on sales of Elestrin. The primary reason for the increase in royalty revenue in 2013 compared to 2012 was royalties received from Actavis on sales of Gelnique in the first half of 2013. No Gelnique royalties were received in the first half of 2012. Total gross profit was $2.4 million and $2 million in the second quarters of 2013 and 2012 and was $4.9 million for the first half of 2013 compared to $6.9 million for the first half of 2012. The decrease in the first half of 2013 compared to 2012 was mainly due to the non-recurring FDA approval milestone payment of $2.5 million from Actavis recognized as revenue in 2012. Total operating expenses were $7.5 million and $4.8 million for the 3 months ended June 30, 2013 and 2012 and were $13.4 million and $9.8 million for the 6 months ended June 30, 2013 and 2012. The increase were primarily due to an increase in OTREXUP commercialization and marketing activities in anticipation of the 2014 launch and increased development activity related to our VIBEX QS T for testosterone replacement therapy, along with an increase in personnel to support our growing pharmaceutical business. Net loss per share was $0.04 and $0.03 for the second quarters of 2013 and 2012 and was $0.07 and $0.03 for the 6-month periods ended June 30, 2013 and 2012. At June 30, 2013, Antares had approximately $75 million in cash and investments compared to approximately $85 million at December 31, 2012. With that, I'll now turn the call back over to Paul for some final comments.

Okay. Thanks, Bob. So when this team took over Antares on October 13, 2008, we immediately designed and implemented a 5-year strategic plan, under which we would refocus the business, invest in the pipeline and position ourselves as a specialty pharmaceutical company built on world-class injection technology. Today, our market cap has grown to more than $0.5 billion as we refocused our vision to our unique injector platforms, which include needle-free, VIBEX Medi-Jet and multi-dose pens. We are still the only U.S. company with a comprehensive range of injector platforms, and I'm happy to report that an ANDA for the first of the multi-dose pens is very much on track. This means that this year, FDA applications for all 3 device platforms will either have been filed and under review or potentially approved for marketing by the FDA, meeting one of the key strategic goals we set 5 years ago. Over the past 18 months, we've spoken to shareholders about how our 5-year strategic plan was driven by disciplined approach to screening potential drug device combinations in order to create novel products. To date, we screened around 200 compounds and come up with approximately 60 interesting candidates. And of these, around 30 are deemed feasible. And as you know, we've selected 3 to pursue initially: OTREXUP, QS T and QS M. We have protected and will continue to protect these candidates with an aggressive intellectual property approach. The way in which the screen process works eliminates a lot of unnecessary risk. We begin by identifying therapeutic areas, where there are unmet patient needs, and hence, a viable market segment for us to participate in. We then determine if we can combine our technology with known molecules like methotrexate or testosterone. And the outcome is a differentiated product that targets the specialty segment of the market. We call it our Antares therapeutic product, or ATP, business model. Our product process targets already approved molecules, where a meaningful clinical benefit can be obtained by switching to an improved subcutaneous delivery through the use of one of our devices. This value proposition also allows for a greater chance of obtaining optimal third-party payer coverage for a wider group of patients. We continue to believe that by following this business model, we can produce enhanced products with significant revenue potential. Antares is an efficient 505(b)(2) machine, and I believe that we're becoming a recognized pioneer in this industry with our unique approach. And to my knowledge, there is no other business that has such a deep pipeline based on proprietary injection technology, covering multi-dose pens, needle-free and auto-injector platforms that can be used to create novel and patent-protected products. We're now entering a new planning cycle, and I'm confident that our approach to building and commercializing a pipeline based on our proprietary-protected technology will position Antares even more strongly for the future. So thanks for your attention this morning, and I'll now open the lines for your questions. Operator?

[Operator Instructions] Our first question is from the line of Louise Chen with Guggenheim.

I had a few. First question I had was on the oral methotrexate pricing and how that may have increased due to drug shortages, and do you think that could be a benefit for OTREXUP? Second question I had was even though you don't have head-to-head data for OTREXUP, why do you feel confident doctors and payers will choose your product over other options? And what do you expect to be in your label with respect to the trials that you've done for the product? And then a third question I have was just on the margins, it was a little bit lower than I would have expected. Just curious if that is the run rate going forward, or if there was something particular in the quarter?

Yes. It's Paul here. Thanks, Louise. I'll hand your OTREXUP questions to Leroux, who's sitting right beside me, and then the margin question is probably best answered by Bob.

Good morning, Louise. Thanks for that question. I think all 3 questions very relevant. First of all, on the price of oral methotrexate, the actual published prices in the price lists have not increased. Although we do see shortages, there may be increasing prices in certain parts of the market. But as far as the official published price -- price increases. But I think it's more about the issue of shortages in the methotrexate market that is an opportunity for us given that we are producing OTREXUP ourselves through our third-party vendors and are not subject to those issues that many of the other manufacturers are experiencing. So we will be able to have a product on the market with adequate supplies. We intend to have inventory and buffer inventories so that we will not run into shortages. So it's definitely an opportunity for us. The next question was I think about preference for the OTREXUP product versus other options?

Yes.

So yes, that value proposition is clearly recognized by almost everybody that we've spoken to, from physicians, rheumatologists to patients, to payers. And the fact of the matter is that currently, there is no real feasible easily administered middle option, in other words, a pre-biologic option, where you can extend and enhance the pharmacology of methotrexate from the oral form by going to the subcutaneous form, which, as a result of the higher systemic availability, potentially better tolerability, allows physicians to continue to manage patients with the low disease state. In other words, they would continue to improve and benefit from methotrexate for months to years, and some patients may, in fact, not need to go to these expensive biologics. So there's a clear value proposition in the clinical utility of subcutaneous methotrexate, which is enhanced by the device, the auto-injector, which, as you know, is a very easy 3-step, 1, 2, 3, self-administered pain-free subcutaneous injection in less than 2 or 3 seconds. Then lastly...

And what about the label, though? Anything you think may be differentiated there given your trials that you've done?

Is Kaushik on the line?

No.

So I will speak on behalf of Kaushik. We know what we submitted to the FDA as part of the NDA. And clearly, the data that was presented by Mike Schiff at EULAR, the bioavailability data, is part of the NDA package. And we would and feel pretty confident that, that data would be included in the label. And the reason we're confident is that this is clinically important for physicians to be aware of as they make their prescribing decisions.

Bob?

And Louise, as far as your question on the margins, I think that a large percentage of our revenues this quarter was around the auto-injector for the epinephrine for Teva. And every one of our deals, whether it's with Teva or Ferring or whatnot, have various economic differences, whether it's a higher device price with a better margin for us with a lower royalty or vice versa, i.e., a higher royalty with a little bit lower margin. I think when you look at our auto-injector business in general and to some degree our pens, on a go-forward basis, we get more money on the royalty end and a little bit lower on the margins. So I think for our auto-injectors, anywhere between 40% and 50% is the average. In our hGH business, we get a higher value per device and a little bit lower royalty. So with the quarter being a high percentage of it being our auto-injector revenue, that's why the margins went down slightly. Also, important to know is that this was our -- the last few months have been really the first time that we've scaled up to this level of production. Everything went extremely well. But when you do that, you've also increased your overhead costs in additional testing to make sure that the product going out was right. And so we'll see that normalizing over the next few quarters going down. And we also built up, obviously, overhead in our manufacturing area in anticipation of OTREXUP being launched. And that overhead gets absorbed into the product sales. And so once we start selling OTREXUP, the margins will go up just by virtue of a more normal utilization of our resources within manufacturing.

And our next question is from Matt Kaplan with Ladenburg Thalmann. Matthew L. Kaplan - Ladenburg Thalmann & Co. Inc., Research Division: Just a couple of follow-ups on the prior question. With respect to -- and just focusing on the OTREXUP launch, can you give us a little bit of a sense in terms of what you're thinking of pricing for your product in the market? And then a few questions after that, too.

Yes, Matt, I'll hand this question again to Leroux who -- we've had a very active period talking to managed care, and we've got a team in-house now. So let me hand this over to him because he's on top of all of the details.

Matt, another good question, and clearly, we are getting close to making our final pricing decision as we continue to assess and evaluate the current managed care and access and coverage reimbursement markets. It's important for us to understand the implications of price sensitivity and where the controls might kick in to either encourage limited usage, or strict usage or, in fact, position the product for increased usage, which is clearly what we're looking for. And we've previously stated that our pricing range would be somewhere between $5,000 and $6,000 per year or somewhere $500 and $600 per month of treatment, so around $100 to $125 per week per self-administered injection. We intend to price all strengths the same. Matthew L. Kaplan - Ladenburg Thalmann & Co. Inc., Research Division: Okay, very good. And then in terms of -- just detail a little bit for us as you did before, but just make it a little more clear, with respect to how your product differentiates from the current injectable product besides being subcu?

Yes. So Matt, the current injectable products in the market is only approved for use for intramuscular injection, which is generally a form of injection that you should be given in a clinic under medical supervision. What we're developing is an auto-injector that can be given subcutaneously, and that kind of route of administration can be given at home. And the reason the intramuscular injection is given under medical supervision is that the muscle is a very vascular area, and obviously, you want to make sure you don't hit any major blood vessels when you're giving yourself a shot. So that's why we're developing subcutaneous route. And it's also the reason why subcutaneous testosterone will be able to be given at home in a device, whereas currently giving a drug like that by deep intramuscular injection almost has to be given under medical supervision.

Additionally, one of the things, Matt, that we saw in our clinical studies is that the patients find it extremely easy to use our device. These are rheumatoid arthritis patients that have compromised hand function, and using a needle and pulling the drug out of a vial is not an easy task to ask from someone who's got significantly deformed hands or, at least, reduced utilization of those hands. So I think that's a major differentiation for the patient being able to actually self-administer at home.

Yes. And there's also -- the additional benefit as well is that in the trials we conducted, the pain score on self-administration of methotrexate using the VIBEX Medi-Jet device, on a scale of 0 to 100, it was pretty much around 2 to 3, which is nothing. So when you compare that with a standard injection, you can see the -- by the way, the patient doesn't see the needle with our device either. So they feel nothing when they give themselves a shot pretty much, and I think that's a great benefit for patients at home. Matthew L. Kaplan - Ladenburg Thalmann & Co. Inc., Research Division: And then just with OTREXUP, and maybe a question for Leroux. Can you give us a sense in terms of what you're thinking with respect to SG&A spend going into the launch of the product and how we should model that?

Well, I can tell you, Matt, we indicated that we expect to spend about $12 million to $15 million a year on sales and marketing expense for OTREXUP. Matthew L. Kaplan - Ladenburg Thalmann & Co. Inc., Research Division: And then I guess, a question for Bob, just in terms of the timing of the Teva program, just give us a quick update in terms of potential filing and launches for the Teva programs.

Sure. On the epinephrine program, obviously, we have a date that's been settled between Teva and Myelin and Pfizer, a launch date of June of '15. And we believe we'll hit that target date. And we're hoping to get the approval of our auto-injector, obviously, well before that. With regards to the one of the pen programs, the ANDA, we believe that's very -- that will be an ANDA filing shortly or, at least, an acceptance of one. And we're looking forward to that moving along. That would typically -- once it's filed, it would probably be subject to a 30-month stay, but we'll see where that goes once that filing is made. And then as far as the sumatriptan program, we are finishing up our final information that we need to send to the agency to get that approved, and we're hoping that happens as far as the filing next few months. And then it's really up to the FDA as to how quickly they'll review the information that they requested before. It's not like we're back in queue of a review process, but obviously, responding to questions has its own kind of timeline that is unknown to most people.

Yes. And there's another program with the multi-dose pen as well, which is being spearheaded in Europe, Matt, which will be initially, what I would say, a branded generic 505(b)(2) type of approach. And that program is moving along real well, too. So all of our programs actually with Teva have gone extremely well the past few months. And I would say that the relationship with Teva goes all the way up to the top of the company and across the company. And I'm going to tell you this for nothing, it's better than it's ever been before. And I'm very pleased with the amount of progress and the attention we get at Teva now.

And next is Akiva Felt with Oppenheimer. Akiva Y. Felt - Oppenheimer & Co. Inc., Research Division: Paul, prepared remarks mentioned that the OTREXUP regulatory review is on track. Just wondering, would it possible to get some additional color here? And maybe as a follow-up to Louise's question earlier, have you received any feedback from FDA regarding the proposed labeling?

We -- I can't comment on how the review is really going, but other than saying that it's going well from our point of view. We're having, as I understand it from our regulatory group, weekly interactions with the agency at the moment, answering their questions. And from what I can tell, it's all going quite smoothly. So we would anticipate that we'll -- if we are going to get labeling discussions underway with the agency, it'll be later on this summer. And what I can tell you right now is I still believe that we're shooting for the 14th of October as the PDUFA date. Akiva Y. Felt - Oppenheimer & Co. Inc., Research Division: Okay. And then just a quick question for Bob. Looking at the cash on hand at the end of the quarter, you see good flexibility there to accommodate different possible scenarios around the OTREXUP approval timing and early launch?

As far as our cash, I think we have an extremely strong balance sheet. And we're well poised for an on-time launch and hopefully, building up the sales rapidly. I think our burn will go up over the next few quarters just because as we move forward and start to bring online the sales reps and so forth, obviously, you bring them on somewhat a little bit before the launch, and so you have that little bit of a tail, where you're spending more than what you're bringing in. But clearly, $75 million at this point is sufficient to get us well through the launch and well into the future. So I don't see any concerns on the cash side from our company. And as far as the launch, yes, we're expecting a January '14 launch, with the reps having their sales meeting in that time frame. And we're looking forward to a very good launch and increasing our product revenue going forward. Akiva Y. Felt - Oppenheimer & Co. Inc., Research Division: Okay, great. And then maybe just a final follow-up question for Leroux. Will we get an update on OTREXUP pricing, will that be soon after approval or likely closer to the start of launch?

I would say that it would be towards the end of the year.

[Operator Instructions] Our next question is from Oren Livnat with Jefferies.

I'm just curious, on the EpiPen front, are you aware of any ongoing dialogue with -- between Teva and the FDA regarding potential AB rating from this product?

I'll hand that one to Bob, who's the Teva relationship coordinator.

There has clearly been activity and dialogue with the agency around epi as far as filings and so forth. But as far as the specific question about AB rating, I think the agency has been very clear about that, that, that's always a decision that's made at the very end. And it's something that they look at when they see the final filing, what the -- how the device acts, and just generally, the -- it's a decision that's made at the end. So like I said for numerous times, we believe it's an AB-rated product. We believe that it operates in a very -- in a similar manner, it looks identical. And we feel pretty confident that it will be AB rated since all the questions from the agency have been around really how we are the same as the innovator. And I think, too, Oren, there's been a lot of FDA guidance that's been published since our filing and so forth that really kind of gives a good layout that it doesn't have to be identical, that it has to operate in the same manner. And the agency is standing by that, and so we expect a good outcome from our filing.

All right, appreciate that. And on the QS T program, so obviously, your studies there and clinical trials now to see. And I'm just curious if that end of the year data is still the plan and maybe how, a, what are looking for in terms of attributes on PK, if you can share anything with us? And how fast do you think you can get into Phase III, assuming you see what you want?

Yes, Oren, so the program currently is on track to deliver data around the end of this year. And the, I think, data generation is going to be driven by the rate of recruitment we get into the sites. But I can tell you there's no shortage of people queuing up to participate in this type of trial. But the type of data we'll generate in this, it's a once weekly injection of the testosterone, which is probably the best frequency to deliver testosterone, at least the ester we're using, because it coincides with the half life of the drug, which is the ideal frequency to give a drug. And our goal here is to provide a therapeutic profile of the drug within the bloodstream that is very modulated. You won't get the peaks and troughs you see with every 2- or every 4-weekly injections which are given by deep intramuscular shot. And then the phase -- the next study we will conduct will begin in 2014. This will be a larger study. We have -- we will be going back to the agency after we've completed this current round to just chat with them about the next phase of the program. But I'm anticipating a study there which will be similar to the other testosterone programs you've seen like the Axiron program, for example. You're looking typically around 100 to 200 patients, mainly monitoring blood levels for outcome. And then as soon as we finish that one, we will file with the NDA. I can tell you that from the pharmaceutical development side of things, we do know we have a stable product. We've already got this drug on stability, and it's looking good. The delivery of the drug just takes a matter of seconds through a fine gauge needle, which is -- it's actually a 27-gauge needle we're using. And it's an extremely efficient way to deliver the drug to -- through the subcutaneous route.

And if I just may squeeze one last one, I'm sorry if you already mentioned it, but the Tev-Tropin 10-milligram, are we expecting that near-term?

We're still waiting for the information from the agency on the approval. And it's not our NDA, by the way, it's actually a Ferring NDA.

What I can say is there has been -- there are actions between the FDA and Ferring, and they're getting some additional information to them, no clinical trials or anything that are required. And hopefully, they'll be able to get those responses to them quickly, and it'll be back in the FDA's court as far as the FDA approval of it. But we feel confident, it will be approved just from a timing standpoint. We just can't predict it right now, but we're hoping in the next 6 months or so.

And I'm showing no further questions. I'll turn the call back to management for closing remarks.

Thanks again for listening to today's conference call. If you have any follow-up questions, please call me at (609) 359-3016. That completes today's call.

Ladies and gentlemen, if you'd like to listen to a replay of today's call, you can dial (303) 590-3030 or 1 (800) 406-7325, with the access code of 4632564. This concludes our presentation for today. We appreciate you participation. You may now disconnect.