West Coast Editor

SAN FRANCISCO - Handshakes, back slaps, watch checking and power lunches continued apace, as JPMorgan's 24th Annual Healthcare Conference entered its second day, with attendees inching through the packed hallways of the Westin St. Francis hotel to hear companies make their slide-show pitches.

"The mood is significantly better than what I've seen in past years - which is easy to say, given how tough the fourth quarter of 2005 was," said Ronald Renaud, analyst with New York-based JPMorgan Securities Inc.

"We saw a lot of Phase III programs go the wrong way [in the last part of the year]," he noted, adding that "people are coming in with the attitude that things can only get better," and a "barrage of press releases with positive news" Monday seemed to confirm as much.

On the subject of turnarounds, Tuesday's presentation by Biogen Idec Inc., of Cambridge, Mass., proved especially pleasing to Renaud. "A year ago, we were here talking about the Tysabri launch, and how well it was going," he said. The multiple sclerosis drug, partnered with Elan Corp. plc, of Dublin, Ireland, was pulled from the market in February based on reports of progressive multifocal leukoencephalopathy. (See BioWorld Today, March 1, 2005.)

Now, after about 10 months of Tysabri-related gloom, upbeat Biogen Idec is talking about re-launching the product into the MS marketplace.

"I was a bit surprised to hear that clinical trials are going to start any day," Renaud told BioWorld Today, calling Biogen Idec his favorite large-cap stock. "Their best days are ahead of them."

In November, the FDA accepted and designated for priority review the supplemental biologics license application for Tysabri (natalizumab), a filing that includes final two-year data from the Phase III AFFIRM monotherapy trial and SENTINEL add-on trial with Biogen Idec's own Avonex (interferon beta-1a) in MS, as well as an integrated safety assessment, and a revised label and risk-management plan.

Though not haunted by trouble of the Tysabri magnitude, another firm planning for good times ahead is PDL Biopharma Inc., the Fremont, Calif.-based company known until this week as Protein Design Labs Inc.

Slated to present at the JPMorgan meeting this morning, PDL's CEO Mark McDade will outline its "Vision 2010," a map for the company's growth following its $475 million buyout of Edison, N.J.-based ESP Pharma Inc., completed in March. (See BioWorld Today, Jan. 26, 2005.)

The takeover of hospital-focused ESP let PDL reach its commercialization goal two years ahead of the original schedule, McDade told BioWorld Today, "so the team took another look and came up with a five-year plan," which he will be sharing with conference attendees. For 2006, the plan includes PDL becoming cash-flow positive on a full-year basis, he said.

PDL has three marketed products: Cardene IV (nicardipine hydrochloride) for short-term treatment of hypertension when oral therapy is not feasible, Retavase (reteplase) for acute myocardial infarction, and intravenous Busulfex (busulfan), a pre-conditioning agent for bone marrow transplants in chronic myelogenous leukemia.

Also Tuesday, PDL disclosed a licensing deal with CoGenesys, a division of Rockville, Md.-based Human Genome Sciences Inc., for an undisclosed target antigen. (See story in this issue.)

Since the ESP buyout, PDL has grown its hospital-focused sales and operations team in North America to about 125 people, an increase of about 40 sales reps.

"We should have three [more] drugs in pivotal studies by the year's end," McDade said. Those include terlipressin, a synthetic 12-amino-acid peptide for Type 1 hepatorenal syndrome, which already is in Phase III, as well as Nuvion (visilizumab), an anti-CD3 compound for steroid-refractory ulcerative colitis, and ularitide, a synthetic natriuretic peptide for acute decompensated heart failure.

McDade, a biotech and pharma veteran, echoed Renaud's impression of the conference - and then some. "I've never sensed more enthusiasm than I have this year," he said.

As it did last year during the JPMorgan event, Genzyme Corp. provided an early peek at the fourth-quarter bottom line, reporting a 22-percent jump in revenues to $722 million from $591 million in the same quarter a year ago. For the full year, the total was $2.7 billion, up 24 percent from $2.2 billion in 2005.

"It was an in-line' forecast for us," Renaud said. "No surprises there."

Full results, along with more guidance, are expected in mid-February. Meanwhile, the Cambridge, Mass.-based firm said its revenue target for 2006 stands between $3.1 billion and $3.3 billion, with earnings per share between $2.65 and $2.75 - a range that analyst Christopher Raymond with Robert Baird & Co. in Chicago called "conservative" and "quite beatable."

Fourth-quarter sales of key Genzyme products also landed in line with Raymond's estimates. Cerezyme (imiglucerase for injection) for Type I Gaucher's disease sold $232 million, compared to the $238 million guess. Renagel (sevelamer hydrochloride), the phosphate binder for patients with end-stage kidney disease on hemodialysis, came in at $111 million, and Fabrazyme (agalsidase beta), the enzyme-replacement therapy for Fabry's disease, sold $81 million, compared to the $85 million forecast.

In 2006, Genzyme's lucrative drugs are likely to be Fabrazyme, which Raymond predicted will sell $379 million, up 24 percent, and Renagel, expected to grow 15 percent to sales of $482 million.

"Perhaps surprise upside" is due this year from Hectorol (doxercalciferol), a vitamin D2 product gained through Genzyme's $600 buyout of Madison, Wis.-based Bone Care International Inc., disclosed last spring. Raymond forecasts sales of $119 million, which would amount to a 49 percent rise. (See BioWorld Today, May 5, 2005.)

The drug is approved to treat secondary hyperparathyroidism in patients on dialysis, and those with earlier stages of chronic kidney disease. Genzyme finished the BCI takeover during the third quarter and began reducing inventory levels for Hectorol, while nailing down wholesale distribution arrangements.

Renaud said Genzyme's numbers matched his firm's estimates, as well. With Hectorol, "you have a lot of things to get back on track, getting marketing plans in place under a new umbrella." He cited a "little bit of confusion" related to Medicare payments, but said Hectorol and Renagel, Genzyme's flagship product, "will ultimately benefit."

The conference runs through Thursday.