BioMarin CEO: There are biotech companies 'that probably should not be on the market today’

BioMarin CEO JJ Bienaimé joins Yahoo Finance Live’s Julie Hyman and Anjalee Khemlani to discuss the company's first gene therapy product targeted to patients dealing with hemophilia, the future of biotechnology, biotech stocks, and key takeaways from JPMorgan’s annual health care conference.

Video transcript


JULIE HYMAN: Well, we continue to track that JP Morgan Health Care Conference. And one of the announcements coming out related to it came from biotech company BioMarin, which said its gene therapy treatment for hemophilia A did show positive results in a trial. And the company plans to be filing for FDA approval perhaps in the second quarter. The CEO, JJ Bienaimé, is joining us now along with our Anjalee Khemlani, who remains with us.

JJ, thank you for being here. I wanted to ask about this drug first of all, this treatment first of all. As I mentioned, the plan, I believe, is for you to apply for FDA approval in the second quarter. Talk to me about that timeline and how important this drug could be for the company.

JJ BIENAIMÉ: Yeah, so this a-- this is our first gene therapy product, actually. This is the first gene therapy product that's going to be addressing a large patient population in history. So we implemented this trial, which is the largest, also the largest gene therapy trial ever done.

So hemophilia, this is going to be for-- the study was severe hemophilia patients that currently the standard of care is two to three intravenous infusion of recombinant factor, which is effectively missing to be able to coagulate per week. And we have taken these patients who had, well, they were on the standard of care, they had 4.6 bleeding episodes, treated bleeding episodes per year, which means their knees was blowing up, for instance. And we just treated them with a one-hour infusion of our gene therapy product.

And with this study, we demonstrated after two years, two years after treatment, just one treatment, their bleeding episodes went from 4.6 to less than 1. So measurably control and a 95% reduction in Factor VIII infusion, so which would be a great savings for the health care system. So we already filed for this product in Europe last summer. So we are planning on refiling in the US also in the second quarter of this year. So we have basically demonstrated superiority over standard of care without any doubt.

For those familiar with biostatistics, the p-value was 30. It was 10 zeros after the decimal. So there is no question about the efficacy of the product. And I think this is a transformational treatment option for patients. And this is great news for hemophilia patients in the world.

ANJALEE KHEMLANI: JJ, I want to ask you about really looking broadly at the industry, you're clearly well-positioned. Gene therapy is really the huge hot thing this year that everyone's looking forward to. How do you plan to leverage that, especially as competition grows in the space, your experience already in it?

JJ BIENAIMÉ: Yes, so we already also have a gene therapy manufacturing facility, which we believe is ahead of most of our competition, state of the art, which was already validated by the European authorities. So we have other gene therapy products in development, one for PKU, phenylketonuria, for which we have two products on the market already. One for hereditary angioedema. And we are planning on moving into cardiovascular indications with gene therapy like hypertrophic cardiomyopathy, which is a very large indication for which today there is no-- there is pallative care, but there is no very effective treatment for it. And it's a potentially lethal disorder. So definitely see that something that we are continuing to move forward to.

Our manufacturing capacity today is about 10,000 treatments per year. And one treatment is one patient because since we only give one-- one treatment per patient. So we have the capacity to actually grow this relatively fast if need be. There are 120,000 hemophilia patients in the world, excluding India and China. About 60% of them have severe hemophilia, which is our target population.

So for us, it's a relatively large market compared to what we've been dealing so far. Our revenues in 2021 are going to be around $1.8 billion. This drug, along with another drug that was recently approved and we just are in the process of launching for the most common form of human dwarfism, should take the company to around between $4 and $5 billion of revenues by 2025.

JULIE HYMAN: And JJ, I have another big picture question for you on the biotech industry. Going into this JP Morgan conference, the analysts there cited a survey that they had taken of 78 hedge fund and other buy-side investors. They said 87% expected an increase in mergers and acquisitions in the industry in the coming year. Now we're not seeing many announcements on that front coming out of the conference. But I'm curious what your expectations are and whether any of that M&A might involve your company specifically.

JJ BIENAIMÉ: You mean as an acquirer or as a target?

JULIE HYMAN: Either way.

JJ BIENAIMÉ: Either way, so I think, indeed, you know, the valuations of biotech companies have been going down in the past year or so. I think there were a lot of new biotech companies funded by venture capitalists that probably should not be on the market today. That's my opinion. So I think there is probably a consolidation coming up. On [INAUDIBLE] Biomarin, we don't-- you know, we have a growing pipeline, growing revenues. We're going to become profitable this year. We have no urgency to acquire, to make a significant acquisition.

We are always looking for the product partnerships. We have done 12 early-stage partnerships in the past 18 months. So we're going to continue to do that because this is what we believe allow us to create shareholder value. As far as I know, since I joined the company, from 17 years ago now as CEO, there were rumors that we would be acquired. A lot of companies that were rumored to acquire by BioMarin actually have been acquired. So, no, we have been growing revenues. We are profitable. We have a lot of cash. We have a growing pipeline. We definitely have staying power. And we are managing the company for the long term and not not to be acquired.

JULIE HYMAN: JJ, thank you for being here. JJ, Bienaimé, BioMarin CEO I appreciate you being here as well as our Anjalee Khemlani. Take care.