SEC Filings

8-K
AMAG PHARMACEUTICALS INC. filed this Form 8-K on 01/09/2017
Entire Document
 

 

 

UNITED STATES

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):

January 8, 2017

 

AMAG Pharmaceuticals, Inc.

(Exact name of registrant as specified in its charter)

 

Delaware

 

001-10865

 

04-2742593 

(State or other jurisdiction
of incorporation)

 

(Commission file number)

 

(I.R.S. Employer
Identification Number)

 

1100 Winter Street
Waltham, MA

 

02451

(Address of principal
executive offices)

 

(Zip code)

 

(617) 498-3300

(Registrant’s telephone number,
including area code)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 



 

Item 1.01 Entry into a Material Definitive Agreement

 

On January 8, 2017, AMAG Pharmaceuticals, Inc. (the “Company”) entered into a license agreement (the “License Agreement”) with Palatin Technologies, Inc. (“Palatin”).  Under the terms of the License Agreement, subject to the conditions set forth therein, Palatin will grant to the Company (i) an exclusive license in all countries of North America (the “Territory”), with the right to grant sub-licenses, to research, develop and commercialize products containing bremelanotide (each a “Product,” and collectively, “Products”), an investigational product designed to be an on-demand treatment for hypoactive sexual desire disorder (“HSDD”) in pre-menopausal women, (ii) a non-exclusive license in the Territory, with the right to grant sub-licenses, to manufacture Products, and (iii) a non-exclusive license in all countries outside the Territory, with the right to grant sub-licenses, to research, develop and manufacture (but not commercialize) the Products.

 

Pursuant to the terms of the License Agreement, and subject to the conditions set forth therein, the Company is required to make the following payments to Palatin: (i) $60 million as a one-time initial research payment within five days following the date of the closing of the transactions contemplated by the License Agreement (the “Effective Date”), and (ii) up to an aggregate amount of $25 million to reimburse Palatin for all reasonable, documented, out-of-pocket expenses incurred by Palatin, following the Effective Date, in connection with the development and regulatory activities necessary to file a new drug application (“NDA”) for a Product for HSDD in the United States.

 

In addition, pursuant to the terms of the License Agreement, Palatin will be eligible to receive from the Company: (i) up to $80 million in specified regulatory payments upon achievement of certain regulatory milestones, and (ii) up to $300 million in sales milestone payments based on achievement of annual net sales amounts for all Products in the Territory.

 

The Company is also obligated to pay Palatin tiered royalties on annual net sales of Products, on a product-by-product basis, in the Territory ranging from the high-single digits to the low double-digits. The royalties will expire on a product-by-product and country-by-country basis until the latest to occur of (i) the earliest date on which there are no valid claims of Palatin patent rights covering such Product in such country, (ii) the expiration of the regulatory exclusivity period for such Product in such country and (iii) ten years following the first commercial sale of such Product in such country. Such royalties are subject to reduction in the event that: (a) the Company must license additional third party intellectual property in order to develop, manufacture or commercialize a Product or (b) generic competition occurs with respect to a Product in a given country, subject to an aggregate cap on such deductions of royalties otherwise payable to Palatin.  After the expiration of the applicable royalties for any Product in a given country, the license for such Product in such country would become a fully paid-up, royalty-free, perpetual and irrevocable license.

 

Closing is subject to customary conditions, as well as, if required, Palatin’s delivery of financial statements to be filed by the Company with the Securities and Exchange Commission (“SEC”) pursuant to Rule 3-05 of Regulation S-X.

 

The Company and Palatin have made customary representations and warranties and have agreed to certain customary covenants, including confidentiality and indemnification.

 

The License Agreement expires on the date of expiration of all royalty obligations due thereunder unless earlier terminated in accordance with the agreement.  If any of the closing conditions have not been met within 120 days of the date of signing of the License Agreement, the Company has the right to terminate the License Agreement upon ten days’ written notice to Palatin.  In addition, the Company has the right to terminate the License Agreement without cause, in its entirety or on a product-by-product and country-by-country basis upon at least 180 days’ prior written notice to Palatin. Either party may terminate the License Agreement for cause if the other party materially breaches or defaults in the performance of its obligations, and, if curable, such material breach remains uncured for 90 days.

 

The foregoing is only a summary of the material terms of the License Agreement and does not purport to be a complete description of the rights and obligations of the parties under such agreement. The foregoing summary is qualified in its entirety by reference to the available text of the License Agreement, a redacted copy of which the Company expects to file as an exhibit to its Annual Report on Form 10-K for the fiscal year ended December 31, 2016.

 

Item 2.02. Results of Operations and Financial Condition.

 

The following information and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), except as expressly set forth by specific reference in such filing.

 

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On January 9, 2017, the Company issued a press release entitled “AMAG Pharmaceuticals Provides Financial and Business Update”, providing a business update, including preliminary unaudited fourth quarter and annual 2016 financial results, 2017 financial guidance, and an update on its Makena® subcutaneous auto-injector (“SC”) program.  A copy of the Company’s press release is furnished herewith as Exhibit 99.1.

 

Item 7.01. Regulation FD.

 

The following information and Exhibit 99.2 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act, except as expressly set forth by specific reference in such filing.

 

The Company will present further details on the matters noted above, including the Company’s License Agreement with Palatin at the 35th Annual J.P. Morgan Healthcare Conference in San Francisco on January 10, 2017, which will be accessible by a live audio webcast through the Company’s website at www.amagpharma.com on January 10, 2017 at 11:30 a.m. Pacific Time (2:30 p.m. Eastern Time). A copy of the Company’s presentation slides are furnished herewith as Exhibit 99.2.

 

Item 8.01 Other Events

 

On January 9, 2017, the Company issued a press release, entitled “AMAG Pharmaceuticals and Palatin Technologies Enter Into Exclusive Licensing Agreement for North American Rights to Rekynda™ (Bremelanotide), a Potential Treatment for a Common Female Sexual Disorder”, announcing that it had entered into the License Agreement. A copy of such press release is filed as Exhibit 99.3 hereto.

 

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”) and other federal securities laws. Any statements contained herein which do not describe historical facts, including, among others, expectations for the Company’s growth strategy; the Company’s anticipated expansion in women’s health through the licensing transaction with Palatin and plans regarding the development activity of Rekynda; the structure of planned and pending clinical trials for Rekynda; the expected timeline, indications and expenditures for clinical development and commercialization of Rekynda, including the timing for the NDA, subsequent FDA action and commercial launch; Rekynda’s strategic fit for the Company’s women’s health business; the competitive landscape and breadth of the female sexual dysfunction (“FSD”) and HSDD markets and Rekynda’s potential benefits and market potential; expectations for future next-generation formulations of Rekynda; the Company’s and Palatin’s anticipated intellectual property rights associated with Rekynda; the expected timing for the closing of the Rekynda transaction; the timing and value of payments by the Company under the Rekynda licensing transaction; the impact of the Rekynda product on the Company’s financial results; expectations regarding the safety, efficacy and benefits of Rekynda, including that no boxed warning or restrictive REMS programs are anticipated; the potential value Rekynda will create for the Company’s shareholders; Makena’s position in the market and future growth drivers for Makena, including the potential market opportunity, progress for the next-generation development programs and customer engagement and outreach; beliefs that the current SC formulation for Makena offers potential for more convenient and alternative administration; plans to explore alternative injection sites and formulations for Makena; expected timing for the Company’s supplemental new drug application (“sNDA”) for Makena (including expected timing for an FDA decision on the sNDA) and collection and analysis of data, and results, from the definitive pharmacokinetic study; the Company’s belief that it will not request orphan drug exclusivity; the Company’s intentions to request Orange Book listing of Antares’ eligible drug-device patents; growth drivers for Cord Blood Registry (“CBR”), including plans to differentiate CBR offerings and increase engagement and communications in the industry; expectations for Feraheme, including growth for the intravenous (“IV”) iron market and the position of Feraheme within the IV iron market; anticipated growth drivers for Feraheme, including plans to optimize net revenue per gram and grow in key segments; expected timing for reporting clinical trial results and submitting the sNDA for the expanded Feraheme label and expectations that the size of the addressable market, if the broader indication is approved, would double; preliminary and unaudited financial results and cash and debt position for 2016 and the Company’s 2017 financial guidance, including forecasted GAAP and non-GAAP revenues, GAAP and non-GAAP net income, GAAP operating income and adjusted EBITDA; expectations for the Company’s key priorities in 2017, including plans to drive net product sales growth, increase non-GAAP adjusted EBITDA and undertake portfolio expansion activities, including by licensing and acquisition of products or companies; the Company’s beliefs that its commercial team will serve it well for the long-term and that its record revenues in 2016 position it well for future growth in 2017; the Company’s 2017 financial outlook, including revenue, operating income, adjusted EBITDA and net income; expectations regarding top-line and adjusted EBITDA growth in 2017; plans to continue to diversify the Company portfolio and achieve a mix of commercial assets and development pipeline for long-term growth; plans to continue to enhance and scale the Company’s internal capabilities; and beliefs that newborn stem cells have

 

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the potential to play a valuable role in the development of regenerative medicine are forward-looking statements which involve risks and uncertainties that could cause actual results to differ materially from those discussed in such forward-looking statements.

 

Such risks and uncertainties include, among others, (1) the possibility that the closing conditions set forth in the License Agreement, including, if required, Palatin’s delivery of any financial statements to be filed by the Company under Rule 3-05 of Regulation S-X, will not be met and that the parties will be unable to consummate the proposed transactions, (2) uncertainties regarding the Company’s and Palatin’s ability to successfully and timely complete clinical development programs and obtain regulatory approval for Rekynda in North America, (3) the possibility that significant safety or drug interaction problems could arise with respect to Rekynda, (4) the ability of the Company to raise awareness and understanding of HSDD and the potential benefits of Rekynda, (5) uncertainties regarding the manufacture of Rekynda, (6) uncertainties relating to our and Palatin’s patents and proprietary rights associated with Rekynda in North America, (7) that the cost of the Rekynda transaction to the Company will be more than planned and/or will not provide the intended positive financial results, (8) that the Company or Palatin will fail to fully perform under the License Agreement, (9) uncertainty regarding the Company’s ability to compete in the FSD market in North America, and (10) as well as those risks identified in the Company’s filings with the SEC, including its Annual Report on Form 10-K for the year ended December 31, 2015, its Quarterly Reports on Form 10-Q for the quarters ended March 31, 2016, June 30, 2016 and September 30, 2016 and subsequent filings with the SEC. Any such risks and uncertainties could materially and adversely affect the Company’s results of operations, its profitability and its cash flows, which would, in turn, have a significant and adverse impact on the Company’s stock price. The Company cautions you not to place undue reliance on any forward-looking statements, which speak only as of the date they are made. The Company disclaims any obligation to publicly update or revise any such statements to reflect any change in expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.

 

AMAG Pharmaceuticals® and Feraheme® are registered trademarks of the Company. MuGard® is a registered trademark of Abeona Therapeutics, Inc.  Makena® is a registered trademark of AMAG Pharmaceuticals IP, Ltd. Cord Blood Registry® and CBR® are registered trademarks of CBR Systems, Inc.  RekyndaTM is a trademark of Palatin.

 

Item 9.01 Financial Statements and Exhibits

 

(d) Exhibits

 

Exhibit No.

 

Description

99.1*

 

Press Release, entitled “AMAG Pharmaceuticals Provides Financial and Business Update”, issued by AMAG Pharmaceuticals, Inc. on January 9, 2017

 

 

 

99.2*

 

Copy of Company’s presentation slides dated January 2017

 

 

 

99.3**

 

Press Release, entitled “AMAG Pharmaceuticals and Palatin Technologies Enter Into Exclusive Licensing Agreement for North American Rights to Rekynda™ (Bremelanotide), a Potential Treatment for a Common Female Sexual Disorder”, issued by AMAG Pharmaceuticals, Inc. on January 9, 2017

 


*   Furnished herewith

** Filed herewith

 

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SIGNATURE

 

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.

 

 

AMAG PHARMACEUTICALS, INC.

 

 

 

 

 

 

 

By:

/s/ Joseph D. Vittiglio, Esq.

 

Name:

Joseph D. Vittiglio

 

Title:

Senior Vice President, General Counsel and Secretary

 

Date: January 9, 2017

 

5



 

EXHIBIT INDEX

 

Exhibit
No.

 

Description

99.1*

 

Press Release, entitled “AMAG Pharmaceuticals Provides Financial and Business Update”, issued by AMAG Pharmaceuticals, Inc. on January 9, 2017

 

 

 

99.2*

 

Copy of Company’s presentation slides dated January 2017

 

 

 

99.3**

 

Press Release, entitled “AMAG Pharmaceuticals and Palatin Technologies Enter Into Exclusive Licensing Agreement for North American Rights to Rekynda™ (Bremelanotide), a Potential Treatment for a Common Female Sexual Disorder”, issued by AMAG Pharmaceuticals, Inc. on January 9, 2017

 


*   Furnished herewith

** Filed herewith

 

6


Exhibit 99.1

 

 

FOR IMMEDIATE RELEASE

 

AMAG PHARMACEUTICALS PROVIDES FINANCIAL AND BUSINESS UPDATE

 

2016 total revenue increased 45 percent

 

Provides update on Makena® next-generation program

 

Anticipates 2017 GAAP revenue of $620-$670 million, including Makena net sales of $410-$440 million

 

WALTHAM, Mass., (January 9, 2017) — AMAG Pharmaceuticals, Inc. (NASDAQ: AMAG) today provided a business update, including announcing preliminary unaudited fourth quarter and annual 2016 financial results, 2017 financial guidance, and an update on its Makena® subcutaneous auto-injector program. In a separate release, the company also announced a licensing transaction for RekyndaTM (bremelanotide). The company will present further details at the 35th Annual J.P. Morgan Healthcare Conference in San Francisco on Tuesday, January 10, 2017 at 11:30 a.m. PT (2:30 p.m. ET). A live audio webcast of the presentation and the following breakout session will be accessible through the Investors section of the AMAG website at www.amagpharma.com.

 

“AMAG achieved record growth in 2016, driven by an experienced commercial team that consistently delivers strong results and will serve us well for the long term as our portfolio expands,” said William Heiden, chief executive officer of AMAG. “Record revenues of over half a billion dollars were driven by sales increases across all of our marketed products, positioning us well for further growth in 2017.”

 

“In addition to meeting or exceeding the revenue growth targets we have set for 2017, other key priorities include filing supplemental new drug applications for the Makena subcutaneous auto-injector and the Feraheme label expansion, as well as the acquisition or licensing of additional products to drive further shareholder value. We are also pleased to announce the licensing of Rekynda, a potential treatment for a significant unmet medical need in women’s health.” Mr. Heiden added.

 

Preliminary Fourth Quarter and Full Year 2016 Financial Results (unaudited)

 

Fourth Quarter 2016

 

AMAG expects total GAAP revenue to be between $149 million and $154 million for the fourth quarter of 2016, which includes Makena net product sales of between $96 million and $99 million, Feraheme and MuGard net product sales of between $25 million and $27 million, and CBR service revenue of approximately $28 million.

 

AMAG expects fourth quarter 2016 total non-GAAP revenue to be between $150 million and $155 million, which reflects a $1.4 million purchase accounting adjustment related to CBR deferred revenue.

 



 

The weighted average basic and diluted shares outstanding for the fourth quarter of 2016 totaled 34.3 million and 35.1 million, respectively. Non-GAAP diluted shares for fourth quarter of 2016 totaled 35.1 million.(1)

 

Full Year 2016

 

AMAG expects 2016 total GAAP revenue to be between $529 million and $534 million, which includes Makena net product sales of between $333 million and $336 million, Feraheme and MuGard net product sales of between $96 million and $98 million, and CBR service revenue of approximately $100 million.

 

AMAG expects 2016 non-GAAP revenue to be between $546 million and $551 million, which reflects a $17 million purchase accounting adjustment related to CBR deferred revenue.

 

The company ended 2016 with approximately $579 million in cash, cash equivalents and investments and total debt (principal amount outstanding) of $1.0 billion. The company will report complete financial results for the fourth quarter and full year of 2016 in February 2017.

 

Makena Subcutaneous Auto-Injector Development Program Update

 

AMAG’s successful Makena intramuscular (IM) injection product has orphan drug exclusivity through February 2018. The company continues to work on improving the Makena product with next-generation alternatives. In October 2016, the company initiated a definitive pharmacokinetic (PK) study to demonstrate comparable bioavailability of a subcutaneous (SC) auto-injector product and the current IM injection form of Makena. This open label, parallel trial enrolled 120 healthy post-menopausal women in a 1:1 randomization. Data collection and analysis are still underway, with final results expected by the end of the first quarter of 2017.

 

Assuming the PK data, once fully collected and analyzed, shows comparable bioavailability between the SC and IM injections, the company intends to file a supplemental new drug application (sNDA) for the SC auto-injector in the second quarter of 2017. Preliminary data from the PK study show a higher reporting rate in the SC arm (~25 percent of subjects vs. <5 percent of subjects in the IM arm) of a transient burning/stinging sensation associated with the injection. Similar observations were also reported in the SC arm of the company’s open label, parallel comparative pain study (also initiated in October 2016), which the company recently elected to discontinue. The company does not plan to request orphan exclusivity as part of the sNDA filing and, therefore, anticipates a six-month FDA review timeline. However, there are multiple device and drug-device combination patents and patent applications in-licensed from Antares which relate to the subcutaneous auto-injector. The company intends to request Orange Book listing of eligible Antares drug-device patents.

 

“We believe that the subcutaneous auto-injector offers the potential for greater convenience for healthcare providers and an alternative administration method to the intramuscular injection for patients,” stated Julie Krop, MD, chief medical officer of AMAG. “As part of our broader next-generation program, we are also exploring alternative injection sites and SC formulations to further improve the value of this product for the patients and providers we serve.”

 


(1)  See share count reconciliation at the conclusion of this press release.

(2)  See GAAP to non-GAAP reconciliation for 2017 financial guidance at the conclusion of this press release.

 



 

2017 Financial Guidance(2)

 

The company expects to achieve the following financial results in 2017:

 

$ in millions

 

2017 GAAP Guidance

 

2017 Non-GAAP Guidance

 

Makena

 

$410 - $440

 

$410 - $440

 

Feraheme and MuGard

 

$100 - $110

 

$100 - $110

 

CBR

 

$110 - $120

 

$115 - $125

 

Total revenue

 

$620 - $670

 

$625 - $675

 

 

Includes Rekynda (bremelanotide)

 

 

 

 

 

Net income(3)

 

$19 - $60

 

N/A

 

Operating income(3)

 

$103 - $173

 

N/A

 

Adjusted EBITDA

 

N/A

 

$270 - $340

 

 

“After a strong performance in 2016, we are forecasting approximately 20 percent top-line growth in 2017,” stated Ted Myles, chief financial officer of AMAG. “We are also projecting double-digit adjusted EBITDA growth in 2017, including the additional investments to complete the development of Rekynda. Furthermore, in 2016 we added over $100 million of cash to our balance sheet, which will support additional acquisition or licensing transactions.”

 

Use of Non-GAAP Financial Measures

 

AMAG has presented certain non-GAAP financial measures, including non-GAAP revenues and non-GAAP adjusted EBITDA (earnings before income taxes, depreciation and amortization). These non-GAAP financial measures exclude certain amounts, revenue, or income from the corresponding financial measures determined in accordance with accounting principles generally accepted in the U.S. (GAAP).

 

Management believes this non-GAAP information is useful for investors, taken in conjunction with AMAG’s GAAP financial statements, because it provides greater transparency regarding AMAG’s operating performance and prospects for future performance and allows investors to better compare performance over different periods. Management uses these measures, among other factors, to assess and analyze operational results and trends and to make financial and operational decisions, including in compensation decisions. Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used to supplement an understanding of AMAG’s operating results as reported under GAAP, not as a substitute for GAAP financial measures, and AMAG encourages investors to review its consolidated financial statements and publicly filed reports in their entirety. In addition, these non-GAAP financial measures are unlikely to be comparable with non-GAAP information provided by other companies. Due to the adjustments made to GAAP net income to calculate non-GAAP net income, the non-GAAP measures are higher than GAAP net income. Non-GAAP net income should not be considered a measure of our liquidity. The determination of the amounts that are excluded from non-GAAP financial measures is a matter of management judgment and depends upon, among other factors, the nature of the underlying expense or income amounts. Reconciliations between these non-GAAP financial measures and the most comparable GAAP financial measures are included in the tables accompanying this press release after the unaudited consolidated financial statements.

 

About AMAG

 

AMAG is a biopharmaceutical company focused on developing and delivering important therapeutics,

 


(3)  2017 GAAP financial guidance excludes potential accounting impact of Palatin Technologies license transaction.

 



 

conducting clinical research in areas of unmet need and creating education and support programs for the patients and families we serve. Our products support the health of patients in the areas of maternal health, anemia management and cancer supportive care. Through CBR®, we also help families to preserve newborn stem cells, which are used today in transplant medicine for certain cancers and blood, immune and metabolic disorders, and have the potential to play a valuable role in the ongoing development of regenerative medicine. For additional company information, please visit www.amagpharma.com.

 

Forward-Looking Statements

 

This press release contains forward-looking information about AMAG Pharmaceuticals, Inc. within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Any statements contained herein which do not describe historical facts, including, among others, statements regarding expected 2016 preliminary fourth quarter and full year financial results, including revenues and year end cash, cash equivalents and investments balances and total debt; AMAG’s beliefs that its commercial team will serve AMAG well for the long-term and that its record revenues in 2016 position it well for future growth in 2017; AMAG’s 2017 key priorities, including product development, label expansion and portfolio expansion objectives; expectations regarding the Makena subcutaneous auto-injector program, including the timing of final data results for the PK study, AMAG’s intention to file a sNDA in the second quarter of 2017, its belief that it will not request orphan exclusivity, the FDA’s anticipated review time and its belief that the subcutaneous auto-injector offers potential for more convenient and alternative administration; AMAG’s intention to request Orange Book listing of Antares’ eligible drug-device patent; AMAG’s 2017 financial outlook, including revenue, adjusted EBITDA and net income; expectations regarding top-line and adjusted EBITDA growth in 2017; expectations regarding exploring alternative injection sites and subcutaneous formulations to further improve the value of Makena; and beliefs that newborn stem cells have the potential to play a valuable role in the development of regenerative medicine are forward-looking statements which involve risks and uncertainties that could cause actual results to differ materially from those discussed in such forward-looking statements.

 

Such risks and uncertainties include, among others, (1) the possibility that the closing conditions set forth in the Rekynda license agreement, including any required filings under Rule 3-05 of Regulation S-X,  will not be met and that the parties will be unable to consummate the proposed transactions, (2) uncertainties regarding AMAG’s and Palatin’s ability to successfully and timely complete clinical development programs and obtain regulatory approval for Rekynda in North America, (3) the possibility that significant safety or drug interaction problems could arise with respect to Rekynda, (4) uncertainties regarding the manufacture of Rekynda, (5) the ability of AMAG to raise awareness and understanding of HSDD and the potential benefits of Rekynda, (6) uncertainties relating to our and Palatin’s patents and proprietary rights associated with Rekynda in North America, (7) that the cost of the Rekynda transaction to AMAG will be more than planned and/or will not provide the intended positive financial results, (8) that AMAG or Palatin will fail to fully perform under the Rekynda license agreement, (9) uncertainty regarding our ability to compete in the FSD market in North America, and (10) those risks identified in AMAG’s filings with the U.S. Securities and Exchange Commission (SEC), including its Annual Report on Form 10-K for the year ended December 31, 2015, its Quarterly Reports on Form 10-Q for the quarters ended March 31, 2016, June 30, 2016 and September 30, 2016 and subsequent filings with the SEC. Any of these risks and uncertainties could materially and adversely affect AMAG’s results of operations, its profitability and its cash flows, which would, in turn, have a significant and adverse impact on AMAG’s stock price. AMAG cautions you not to place undue reliance on any forward-looking statements, which speak only as of the date they are made.

 



 

AMAG disclaims any obligation to publicly update or revise any such statements to reflect any change in expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.

 

AMAG Pharmaceuticals® and Feraheme® are registered trademarks of AMAG Pharmaceuticals, Inc. MuGard® is a registered trademark of Abeona Therapeutics, Inc. Makena® is a registered trademark of AMAG Pharmaceuticals IP, Ltd. Cord Blood Registry® and CBR® are registered trademarks of CBR Systems, Inc. RekyndaTM is a trademark of Palatin Technologies, Inc.

 

— Tables Follow —

 



 

AMAG Pharmaceuticals, Inc.

Reconciliation of 2017 Financial Guidance of Non-GAAP Adjusted EBITDA

(unaudited, amounts in millions)

 

GAAP Net Income

 

$19 - 60

 

Adjustments:

 

 

 

Interest expense, net

 

71

 

Provision for income tax

 

13 - 42

 

Operating income

 

$103 - $173

 

Purchase accounting adjustments related to CBR deferred revenue

 

6

 

Depreciation and intangible asset amortization

 

127

 

Non-cash inventory step-up adjustments

 

2

 

Stock-based compensation

 

27

 

Adjustments to contingent consideration

 

5

 

Non-GAAP adjusted EBITDA

 

$270 - $340

 

 

AMAG Pharmaceuticals, Inc.

Share Count Reconciliation

(amounts in millions)

 

 

 

Three Months Ended
December 31, 2016

 

Weighted average basic shares outstanding

 

34.3

 

Employee equity incentive awards

 

0.8

 

Convertible notes

 

 

Warrants

 

 

GAAP diluted shares outstanding

 

35.1

 

Convertible notes

 

 

Effect of bond hedge adjustment

 

 

Non-GAAP diluted shares outstanding

 

35.1

 

 



 

CONTACTS:

Investors:

Linda Lennox

Vice President, Investor Relations

908-627-3434

 

Media:

Katie Payne

Vice President, External Affairs

617-498-3303

 


Exhibit 99.2

AMAG Pharmaceuticals J.P. Morgan Healthcare Conference January 10, 2017

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Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (PSLRA) and other federal securities laws. Any statements contained herein which do not describe historical facts, including, among others, expectations for AMAG’s growth strategy; AMAG’s anticipated expansion in women’s health through the licensing transaction with Palatin Technologies, Inc. and plans regarding the development activity of Rekynda; the structure of planned and pending clinical trials for Rekynda; the expected timeline, indications and expenditures for clinical development and commercialization of Rekynda, including the timing for the new drug application (NDA), subsequent FDA action and commercial launch; Rekynda’s strategic fit for AMAG’s women’s health business; the competitive landscape and breadth of the female sexual dysfunction (FSD) and hypoactive sexual desire disorder (HSDD) markets and Rekynda’s market potential; expectations for future next-generation formulations of Rekynda; AMAG’s and Palatin’s anticipated intellectual property rights associated with Rekynda; the expected timing for the closing of the Rekynda transaction; the timing and value of payments by AMAG under the Rekynda licensing transaction; the impact of the Rekynda product on AMAG’s financial results; expectations regarding the safety, efficacy and benefits of Rekynda, including that no boxed warning or restrictive REMS programs are anticipated; Makena’s position in the market and future growth drivers for Makena, including the potential market opportunity, progress for the next-generation development programs and customer engagement and outreach; beliefs that the current subcutaneous autoinjector (SC) formulation for Makena offers potential for more convenient and alternative administration; plans to explore alternative injection sites and formulations for Makena; expected timing for AMAG’s supplemental new drug application (sNDA) for Makena (including expected timing for an FDA decision on the sNDA) and collection and analysis of data, and results, from the definitive pharmacokinetic (PK) study; growth drivers for Cord Blood Registry (CBR), including plans to differentiate CBR offerings and increase engagement and communications in the industry; expectations for Feraheme, including growth for the intravenous (IV) iron market and the position of Feraheme within the IV iron market; anticipated growth drivers for Feraheme, including plans to optimize net revenue per gram and grow in key segments; expected timing for reporting clinical trial results and submitting the sNDA for the expanded Feraheme label and expectations that the size of the addressable market, if the broader indication is approved, would double; preliminary and unaudited financial results and cash and debt position for 2016 and AMAG’s 2017 finan cial guidance, including forecasted GAAP and non-GAAP revenues, GAAP and non-GAAP net income, GAAP operating income and adjusted EBITDA; expectations for AMAG’s key priorities in 2017, including plans to drive net product sales growth, increase non-GAAP adjusted EBITDA and undertake portfolio expansion activities, including by licensing and acquisition of products or companies; plans to continue to diversify the AMAG portfolio and achieve a mix of commercial assets and development pipeline for long-term growth; and plans to continue to enhance and scale AMAG’s internal capabilities are forward-looking statements which involve risks and uncertainties that could cause actual results to differ materially from those discussed in such forward-looking statements. Such risks and uncertainties include, among others, (1) the possibility that the closing conditions set forth in the license agreement for Rekynda will not be met and that the parties will be unable to consummate the proposed transactions, (2) uncertainties regarding AMAG’s and Palatin’s ability to successfully and timely complete clinical development programs and obtain regulatory approval for Rekynda in North America, (3) the possibility that significant safety or drug interaction problems could arise with respect to Rekynda, (4) the ability of AMAG to raise awareness and understanding of HSDD and the potential benefits of Rekynda, (5) uncertainties regarding the manufacture of Rekynda, (6) uncertainties relating to our and Palatin’s patents and proprietary rights associated with Rekynda in North America, (7) that the cost of the Rekynda transaction to AMAG will be more than planned and/or will not provide the intended positive financial results, (8) that AMAG or Palatin will fail to fully perform under the Rekynda license agreement, (9) uncertainty regarding AMAG’s ability to compete in the FSD market in North America, and (10) as well as those risks identified in AMAG’s filings with the U.S. Securities and Exchange Commission (SEC), including its Annual Report on Form 10-K for the year ended December 31, 2015, its Quarterly Reports on Form 10-Q for the quarters ended March 31, 2016, June 30, 2016 and September 30, 2016 and subsequent filings with the SEC. Any such risks and uncertainties could materially and adversely affect AMAG’s results of operations, its profitability and its cash flows, which would, in turn, have a significant and adverse impact on AMAG’s stock price. AMAG cautions you not to place undue reliance on any forward-looking statements, which speak only as of the date they are made. AMAG disclaims any obligation to publicly update or revise any such statements to reflect any change in expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements. AMAG Pharmaceuticals® and Feraheme® are registered trademark of AMAG Pharmaceuticals, Inc. MuGard® is a registered trademark of Abeona Therapeutics, Inc. Makena® is a registered trademark of AMAG Pharmaceuticals IP, Ltd. Cord Blood Registry® and CBR® are registered trademarks of CBR Systems, Inc. Rekynda is a trademark of Palatin Technologies, Inc. 2

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AMAG Portfolio Feraheme® • Used for the treatment of iron deficiency anemia (IDA) in adult patients with chronic kidney disease (CKD) Makena® • The only FDA-approved therapy to reduce recurrent preterm birth in certain at-risk women Cord Blood Registry® • World’s largest umbilical cord stem cell collection and storage company MuGard® • Prescriptive mucoadhesive for the management of oral mucositis, a common side effect of radiation or chemotherapy, affecting ~400,000 U.S. cancer patients with oral mucositis in U.S. annually1 Velo Option • At completion of a Phase 2b/3a clinical trial, AMAG has the option to acquire an orphan drug candidate for the treatment of severe preeclampsia 1 Sonis ST. Oral Oncol. 2009 Dex;45(12):1015-20. 3 New Addition • Recent successful completion of two Phase 3 clinical trials for on-demand treatment of hypoactive sexual desire disorder (HSDD). NDA filing planned for early 2018, potential approval early 2019.

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2016 Highlights Makena Launched single-dose, preservative free formulation, driving 45% growth over 4Q-2015  Initiated and fully enrolled pharmacokinetic (PK) study –Comparing bioavailability between subcutaneous (SC) and intramuscular (IM) injections Feraheme Completed enrollment in 2,000 patient broad iron deficiency anemia (IDA) study Accelerated potential approval timeline for IDA label expansion by ~6 months Cord Blood Registry (CBR) Enhanced messaging to capitalize on generational shift Increased stored units by ~40k in 2016 Financial - Drove significant top-and bottom-line growth Achieved record sales of Makena and Feraheme Realized strong operating income/adjusted EBITDA results Ended 2016 with $579M of cash 4

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Strong 2016 Financial Results (preliminary and unaudited) 1 Non-GAAP revenue includes purchase accounting adjustments related to CBR deferred revenue of $1.4M and $17M in the fourth quarter and full year of 2016. *AMAG plans to issue fourth quarter and full year 2016 financial results in February 2017. 5 Total revenue increased 40% and 45% in fourth quarter and full year over 2015, respectively Full Year 2016 Preliminary Results GAAP Non-GAAP $333 - $336 $333 - $336 $96 - $98 $96 - $98 ~$100 ~$1171 $529 - $534 $546 - $5511 4Q-2016 Preliminary Results GAAP Non-GAAP $96 - $99 $96 - $99 $25 - $27 $25 - $27 ~$28 ~291 $149 - $154 $150 - $1551 ($M) Makena Feraheme/MuGard Cord Blood Registry Total revenue

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A Key Step Forward in Growth Strategy Leveraging expertise and acquiring innovative products/companies with long-term, durable growth potential and revenue streams Future Product Rekynda Makena® Hematology / Oncology, Nephrology & Hospital Women’s / Maternal Health Commercial & Digital Expertise Strong financial profile, management team & corporate infrastructure 6

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Rekynda (bremelanotide)

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Rekynda (bremelanotide) Expands AMAG into Women’s Health Strategic Rationale Natural extension of AMAG’s Women’s Health Platform - - Excellent strategic fit and value creator for shareholders Most common type of female sexual disorder is hypoactive sexual desire disorder (HSDD) • ~5.8M pre-menopausal women suffer from HSDD1 - Two successful HSDD Phase 3 trials completed and NDA-ready early-2018 AMAG commercial capabilities well-positioned to drive early 2019 launch - Leverage existing AMAG commercial and medical affairs teams • • Patient access capabilities, digital marketing platforms and relationships with KOLs Will expand current 100+ women/maternal health sales force Capital efficient, low-risk transaction structure - - - - Modest upfront and development costs to approval Milestones upon NDA acceptance approval One-time sales milestones and tiered royalty structure Intellectual property: • • Composition of matter patent through 2025 with Hatch Waxman extension Additional Method patent through 2033 1 Burke Institute: patient and economic flow study, April 2016 8

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Transaction Designed to Build Long-Term Shareholder Value • • • $60M upfront payment; up to $25M funding of development costs to approval Up to $80M upon acceptance and approval of NDA Up to $300M in sales milestones, as well as tiered high-single to low-double-digit royalties – First sales milestone: $25M at $250M in annual revenues • • Licensed exclusive North American rights from Palatin Technologies, Inc. (NYSE: PTN) Lead pipeline product Rekynda (bremelanotide) for treatment of hypoactive sexual desire disorder (HSDD) • • Investing in pre-launch/launch activities All manufacturing rights transferred to AMAG (CMOs: Lonza, Ypsomed Group, Catalent) 9 Expected to close transaction 1Q-2017 Commercial Palatin Transaction

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Significant Market Opportunity with HSDD1 ~10M pre-menopausal women in U.S. 5.8M2 women presented to women with 2.8M pre-menopausal symptom) 4.4M3 pre-menopausal women with 15M U.S. women with HSDD1 HSDD (not primary symptom) 4.8M post-menopausal women with HSDD 1 Survey data from Shiren (2008); 2014 U.S. census data 2 Burke Institute: patient and economic flow study, April 2016 3 Survey data from West (2008); Shifren (2008); Leiblum (2006) 10 Potential initial patient population 0.8M pre-menopausal women treated (Rx) pre-menopausal2.2M pre-menopausal HSDDHCP, but not treated (primary women not diagnosed

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Rekynda (bremelanotide) Profile & Phase 3 Results Taken on-demand with a self-administered auto-injector pen in anticipation of sexual activity Novel mechanism of action: melancortin receptor agonist (MCR4) – Targets pathways involved in sexual desire and arousal response Two successful Phase 3 studies completed - - Randomized 1,267 pre-menopausal women with primary HSDD Co-primary efficacy endpoints met (top-line Phase 3 results released 4Q-2016) • Improvement in sexual desire and decrease in distress associated with low sexual desire Generally well tolerated; most common adverse events were nausea, headache and flushing (generally mild/moderate) • – ~80% of patients that completed the Phase 3 trials elected to participate in the open label roll-over safety study 11

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Rekynda (bremelanotide) Highly Differentiated Target Product Profile • Patient administered with subcutaneous auto-injector pen hypoactive sexual desire disorder (HSDD) 12 Rekynda (bremelanotide) Dosing & Administration • Taken on-demand in anticipation of sexual activity • Rapid onset of activity ~30 minutes • Treatment effective up to 8-10 hours Indication • The treatment of pre-menopausal women with acquired generalized Safety • Does not interact with alcohol (alcohol interaction study completed) • Generally well tolerated; most frequent adverse event was nausea (generally mild/moderate) • No Boxed Warning anticipated • Not anticipated to have a restrictive REMS program

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Rekynda (bremelanotide) Timeline Phase 3 trials initiated Completed Phase 3 enrollment Phase 3 studies completed Phase 3 top-line results / Co-primary endpoints met Phase 1 standard safety pharmacology and drug-drug interaction studies NDA submission Expected FDA action 4Q-2014 2H-2015 3Q-2016 4Q-2016 2017 early 2018 early 2019 13

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Maternal Health: Makena

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M A T E R N A L H E A L T H : M A K E N A Commercial Makena: ($M) Strong Execution $336 +42%-47% -$99 4Q-2016 Est 1 2016 Est 1 4Q-2015 Act 2015 Act 1 Preliminary and unaudited. 15 $67.4 $96 $251.6 +32%-34% $333-

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M A T E R N A L H E A L T H : M A K E N A Makena gained 12 Percentage Share Points in 2016 $1B Market Opportunity1 Market Share2 Estimated December 31, 20164 December 31, 2015 Off Guidance3 30% Off Guidance3 30% Makena 30% Makena 42% Compounded Hydroxyprogesterone Caproate 40% Compounded Hydroxyprogesterone Caproate 28% 1 Based on 140,000 patients, >16 injections/patient and net revenue of ~$425-$450/injection. 2 Company estimates Makena market share based on distributor dispensing data and all other market share based on physician market research data conducted by AMAG. 3 Off guidance represents patients treated outside guidance of Society for Maternal Fetal Medicine, including patients treated with unapproved therapies and untreated patients. 4 Actual market share based on Company estimates will be disclosed in February 2017 with the release of actual 2016 results. 16

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M A T E R N A L H E A L T H :M A K E N A Accomplishments & Growth Drivers 2016 Accomplishments Successfully launched single-dose, preservative free formulation Increased market share by 40% over 2015 Enhanced patient access to Makena Expanded Optum Home Health Services relationship Initiated and fully enrolled PK study 2017 Growth Drivers Continue to gain share Grow Makena @Home administration Expand share of voice with target customers Penetrate late pre-term birth segment Progress next-generation development programs 17

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M A T E R N A L H E A L T H : M A K E N A Makena Next-Generation Program Update Makena IM orphan drug exclusivity (ODE) through February 2018 Makena SC auto-injector program - Definitive PK study and comparative pain study • Initiated October 2016 - Collection and analysis of PK data ongoing, with results expected 1Q-2017 • Preliminary data suggest transient injection site burning/stinging sensation • • ~25% subjects in SC arm <5% subjects in IM arm • Pain study discontinued (similar observations as in PK study); will not request ODE - - - sNDA filing anticipated in 2Q-2017, assuming comparable bioavailability Expect 6 month review (vs. 10 month review) SC auto-injector covered by multiple issued Antares patents extending to 2026 • Additional patent applications pending Makena SC plans for 2017 and beyond - Current SC formulation offers the potential for: • • Greater convenience for HCPs Alternative to IM injection for patients - As part of broader next-generation program, exploring alternative injection sites and formulations 18

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Maternal Health: Cord Blood Registry (CBR)

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M A T E R N A L H E A L T H : C O R D B L O O D R E G I S T R Y Attractive Recurring Revenue Stream ($M) Non-GAAP, Pro Forma CBR Fourth Quarter Revenue3 GAAP CBR Fourth Quarter Revenue $28.8 ~$28.0 ~$29 $17.0 4Q-2016 Est 1 4Q-2016 Est 1 4Q-2015 Act 4Q-2015 Act Non-GAAP, Pro Forma CBR Full Y ear Revenue3,4 GAAP CBR Full Year Revenue $118.6 ~$117 ~$100.0 $24.1 2015 Act 2 2016 Est 1 2016 Est 1 2015 Act 1 Preliminary and unaudited. 2 Represents revenues from August 17, 2015 to December 31, 2015. CBR was acquired by AMAG on August 17, 2015. 3 Non-GAAP CBR revenue includes purchase accounting adjustments related to CBR deferred revenue of $1.4M and $17M for the fourth quarter and full year of 2016, respectively. 4 Represents pro forma revenue for 2015. AMAG acquired CBR on August 17, 2015. 20

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M A T E R N A L H E A L T H : C O R D B L O O D R E G I S T R Y Accomplishments & Growth Drivers 2016 Accomplishments Drove ~$117M in 2016 revenues (non-GAAP) Grew revenue per consumer 8.5% year over year Increased stored units by ~40k in 2016 Enhanced messaging to capitalize on generational shift Emphasized competitive advantages and market position 2017 Growth Drivers Differentiate CBR’s offerings - - Highlight cord tissue storage offering Enhance product offerings Build value proposition on storing newborn stem cells Increase engagement with the HCP community Strengthen and expand communication channels 21

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Hematology/Oncology: Feraheme

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H E M A T O L O G Y / O N C O L O G Y : F E R A H E M E / M U G A R D Differentiated ($M) Product, Expect Future Growth +6-9% $96-$98 +6%-15% $25-$27 $23.5 3 4Q-2015 Act 2 4Q-2016 Est 2015 Act2 2016 Est 3 1 Based on IMS volume data through December 23, 2016. 2 Feraheme and MuGard. 3 Preliminary and unaudited numbers for Feraheme and MuGard. 23 $90.2 2016 IV iron market grew ~10% vs. 20151 4Q-2016 IV iron market grew ~10% vs. 4Q-20151

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H E M A T O L O G Y / O N C O L O G Y : F E R A H E M E Accomplishments & Growth Drivers 2016 Accomplishments Achieved an estimated $96-$98M in revenues (includes Mugard) 6% growth in grams over 2015 Expanded presence in integrated delivery networks and group purchasing organizations Continued broad patient access strategy, creating reimbursement predictability Completed enrollment in head-to-head Phase 3 trial for broader indication well ahead of schedule - Accelerates sNDA filing to mid-2017 2017 Growth Drivers Continued growth in key segments Optimize net revenue per gram Prepare for expanded label to include IDA patients with all causes – Would double addressable market, if approved 24

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H E M A T O L O G Y / O N C O L O G Y : F E R A H E M E Market Opportunity1 Broad IDA Label Would Double 4.5 million Americans diagnosed with IDA3 Feraheme ~26% IDA-CKD 1.5 million in women’s health3 IDA-CKD IDA IDA Other IV irons ~74% 1 If regulatory approval is received for broad IDA indication. 2 AMAG estimates market opportunity using ~$600/gram and 1.1M grams (Q3-2016 IMS data annualized). 3 Global Intravenous (I.V.) Iron Drugs Market Report: 2015 Edition. 25 IDA IV Iron Market (non-dialysis) Opportunity with Broad IDA indication1 ~$660M / year (non-dialysis)2

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Financial Overview

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Strong GAAP Revenue Growth ($M) Fourth Quarter Product Revenue Full Year Product Revenue $534 $365.9 +38%-43% $154 $107.8 2 1 4Q-2016 Est 1 2015 Act 2016 Est 4Q-2015 Act Makena Feraheme/MuGard CBR 1 Preliminary and unaudited. 2 Represents CBR revenues from August 17, 2015 to December 31, 2015. CBR was acquired by AMAG on August 17, 2015. 27 $149-+45%-46% $529-

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Strong Non-GAAP Revenue Growth ($M) Fourth Quarter Product Revenue Full Year Product Revenue $551 $385.1 +25%-29% $155 $119.7 2015 Act2,3 2016 Est 1,4 4Q-2015 Act 3 4Q-2016 Est 1,4 Makena Feraheme/MuGard CBR 1 Preliminary and unaudited. 2 Represents CBR revenues from August 17, 2015 to December 31, 2015. CBR was acquired by AMAG on August 17, 2015. 3 Non-GAAP CBR revenue includes purchase accounting adjustments related to CBR deferred revenue of $11.8M and $19.1M for the fourth quarter and full year of 2015, respectively. 4 Non-GAAP CBR revenue includes purchase accounting adjustments related to CBR deferred revenue of $1.4M and $17M for the fourth quarter and full year of 2016, respectively. 28 $150-+42%-43% $546-

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Strong Cash Flow Generation 29 • Increased cash $113M over 2015, net of: – $20M stock buy-back – $17.5M in debt principal payments – $100M milestone paid to former Lumara Health shareholders in 4Q-2016 ($M)12/31/1612/31/15 Cash, cash equivalents and investments$579$466 Principal debt outstanding Convertible senior notes (2.5%)$200$200 Term loan facility (4.75%)328346 2023 senior notes (7.875%)500500 Total debt outstanding$1,028$1,046

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AMAG: Growth and Diversification Today Profitable company with 4 marketed products and services Multiple therapeutic areas in attractive segments Maturing next generation development pipeline - Feraheme IDA label expansion1 - Makena SC auto-injector1 Velo option agreement for the treatment of severe preeclampsia Tomorrow Well-diversified portfolio of products and services Mix of commercial assets and development pipeline for long-term growth Enhanced internal capabilities that come with scaled organization Yesterday Dependent on single product Significant cash burn Limited opportunities for organic growth Makena Feraheme CBR MuGard Rekynda Product 6 1 If regulatory approval is received. 30

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2017 Financial Guidance 1 See slide 36 for a reconciliation of 2017 financial guidance. 2 Non-GAAP revenue includes purchase accounting adjustments related to CBR deferred revenue of $17M in 2016. 3 Non-GAAP revenue includes purchase accounting adjustments related to CBR deferred revenue of $5.5M in 2017. 4 2017 GAAP financial guidance excludes potential accounting impact of Palatin Technologies license transaction. *AMAG plans to issue fourth quarter and full year 2016 financial results in February 2017. 31 •Projecting ~20% growth in revenue •Forecasting significant growth in adjusted EBITDA, including investment in the development and pre-commercial activities for Rekynda 2017 Guidance GAAP Non-GAAP $410 - $440 $410 - $440 $100 - $110 $100 - $110 $110 - $120 $115 - $1253 $620 - $670 $625 - $675 $19 - $60 N/A $103 - $173 N/A N/A $270 - $340 2016 Preliminary Results GAAP Non-GAAP $333 - $336 $333 - $336 $96 - $98 $96 - $98 ~$100 ~$1172 $529 - $534 $546 - $551 * * * * * * ($M) Makena Feraheme/MuGard CBR Total revenue Net Income4 Operating Income4 Adjusted EBITDA

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2017 Key Priorities

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2017 Key Priorities 33 2017 Financial Drive net product sales of $650M Grow adjusted EBITDA to +$300M Makena Report results from subcutaneous auto-injector PK study File supplemental New Drug Application Expect FDA decision 4Q-2017 Feraheme Report results from head-to-head Phase 3 clinical trial evaluating the safety of Feraheme compared to Injectafer in adults with IDA File supplemental New Drug Application mid-2017 Portfolio Execute pre-launch and launch activities for Makena and Feraheme line extensions Expansion Filing and launch preparation for Rekynda

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AMAG Pharmaceuticals J.P. Morgan Healthcare Conference January 10, 2017

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Appendix

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Reconciliation of 2017 Financial Guidance of Non-GAAP Adjusted EBITDA 36 2017 Financial Guidance ($M) GAAP net income$19 - $60 Adjustments: Interest expense, net71 Provision for income tax13 - 42 Operating income$103 - $173 Purchase accounting adjustments related to CBR deferred revenue6 Depreciation & intangible asset amortization127 Non-cash inventory step-up adjustments2 Stock-based compensation27 Adjustments to contingent consideration5 Non-GAAP adjusted EBITDA$270 - $340

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CBR Non-GAAP Revenue Adjustment PURCHASE ACCOUNTING FUTURE IMPACT Deferred revenue balance on August 17, 2015 Addback to calculate non-GAAP revenue to be reported in future periods ($M) $70 ($M) $60 $50 Purchase accounting rules $50 $40 require write-down of closing $40 date deferred revenue on balance sheet at $30 $30 acquisition date $20 $20 $10 $10 $0 Closing Date $0 2016 2017 2018 2019 2020-2078 1 2 GAAP Write-Off Amount 3 Non-GAAP Addback 1 Reflects the GAAP balance sheet adjustment following the 2015 acquisition of CBR by AMAG; prior adjustment due to 2012 acquisition of CBR by GTCR. 2 Write-Off amount is added back in the period it would have been recognized in to arrive at non-GAAP revenue. 3 Reflects the addbacks from both the 2015 acquisition of CBR by AMAG and the 2012 acquisition of CBR by GTCR. 37 $58.8 $3.1 $55.4 $17.0 $5.5$5.4 $5.3

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AMAG Pharmaceuticals J.P. Morgan Healthcare Conference January 10, 2017

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EXHIBIT 99.3

 

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FOR IMMEDIATE RELEASE

 

AMAG PHARMACEUTICALS AND PALATIN TECHNOLOGIES ENTER INTO EXCLUSIVE LICENSING AGREEMENT FOR NORTH AMERICAN RIGHTS TO REKYNDATM (BREMELANOTIDE), A POTENTIAL TREATMENT FOR A COMMON FEMALE SEXUAL DISORDER

 

Two Phase 3 trials completed for Rekynda; co-primary endpoints met

 

Will address underserved medical condition with significant untapped market potential

 

Broadens AMAGs presence in womens health and leverages AMAGs commercial capabilities and customer relationships

 

WALTHAM, Mass. and CRANBURY, NJ, January 9, 2017 - AMAG Pharmaceuticals, Inc. (Nasdaq: AMAG) together with Palatin Technologies, Inc. (NYSE MKT: PTN) today announced they have entered into an agreement for exclusive North American rights to develop and commercialize RekyndaTM (bremelanotide), an investigational product designed for on-demand treatment of hypoactive sexual desire disorder (HSDD) in pre-menopausal women, that has successfully completed two Phase 3 trials. The anticipated filing date in the U.S. for a new drug application (NDA) for Rekynda is in early 2018, with an anticipated approval and launch by early 2019.

 

AMAG is excited to expand its womens health portfolio with a product that could address a compelling medical problem that currently is under-addressed,said William Heiden, chief executive officer of AMAG. Rekynda is a natural extension of our existing women’s health platform and offers us a compelling opportunity to create awareness and educate patients and providers about this condition. HSDD can significantly impact self-image, relationships and the general well-being of millions of women.

 

HSDD, the most common type of female sexual dysfunction (FSD), is characterized by low sexual desire that causes marked distress or interpersonal difficulties. HSDD affects approximately 15 million women in the United States.(1) Approximately 5.8 million of these women are pre-menopausal and have a primary diagnosis of HSDD.(2),(3),(4) Despite one HSDD

 


(1)  U.S Census Bureau, 2014; Shifren et all, Sexual Problems and Distress in United States Women; Obstetrics & Gynecology, Vol. 112, No. 5, November 2008

 

(2)  U.S. Census Bureau, 2015 American Community Survey 1-Year Estimates

 



 

therapy on the market today for pre-menopausal women, patient awareness and understanding of the condition remain extremely low, and few women currently seek treatment.(5)  Recent market research indicates that 95 percent of pre-menopausal women suffering from HSDD are unaware that it is a treatable medical condition and that the majority of these women would try a product like Rekynda, if recommended by their doctor.(6)

 

As a potentially safe, on-demand treatment with a fast onset of action, Rekynda could offer an important therapeutic alternative for pre-menopausal women suffering from HSDD,said Carl Spana, Ph.D., chief executive officer of Palatin Technologies. “AMAG’s commercial capabilities are uniquely suited to raise awareness and understanding of HSDD and the potential benefits of Rekynda to both providers and patients. I am confident that AMAG will drive a successful approval and launch of Rekynda in early 2019.

 

Under the terms of the license agreement, AMAG will pay to Palatin $60 million of total upfront consideration, up to $80 million contingent upon achieving certain regulatory milestones and up to $300 million contingent upon meeting certain sales milestones. The first sales milestone is $25 million and would be triggered when Rekynda annual net sales in North America exceed $250 million. Additionally, AMAG expects to reimburse Palatin for up to $25 million of ongoing development expenses incurred by Palatin in connection with the remaining development of Rekynda in 2017. AMAG will also pay Palatin tiered royalties on net sales ranging from high single-digit to low double-digit percentages. AMAG expects the transaction to close in the first quarter of 2017.

 

“We are excited about the potential value Rekynda will create for shareholders as we diversify our womens health portfolio,” said Frank Thomas, president and chief operating officer of AMAG. HSDD is an under-diagnosed medical condition with significant untapped market potential, and we believe our experience in raising awareness and building patient education programs that directly engage women creates a unique opportunity for AMAG and for millions of women across the country.

 

About RekyndaTM (bremelanotide)

 

Rekynda (bremelanotide), an investigational product, is thought to possess a novel mechanism of action, activating endogenous melanocortin pathways involved in sexual desire and response.

 

The two Phase 3 studies for HSDD in pre-menopausal women consisted of double-blind placebo-controlled, randomized parallel group studies comparing a subcutaneous dose of 1.75 mg Rekynda delivered via an auto-injector pen to placebo. Each trial consisted of more than 600 patients randomized in a 1:1 ratio to either the treatment arm or placebo with a 24 week

 


(3)  Mayo Clinic Proceedings: “Hypoactive Sexual Desire Disorder: International Society for the Study of Women’s Sexual Health (ISSWSH) Expert Consensus Panel Review,” Volume 92, Issue 1, January 2017

 

(4)  Burke Institute: Patient and Economic Flow Study, April 2016

 

(5)  Burke Institute: Patient Segmentation Insights, August 2016

 

(6)  Burke Institute: Patient and Economic Flow Study, April 2016

 



 

evaluation period. In both clinical trials, Rekynda met the pre-specified co-primary efficacy endpoints of improvement in desire and decrease in distress associated with low sexual desire as measured using validated patient-reported outcome instruments.

 

Women in the trials had the option, after completion of the trial, to continue in an ongoing open-label safety extension study for an additional 12 months. Nearly 80% of patients elected to remain in the open-label portion of the study, and all of these patients will continue to receive Rekynda.

 

In both Phase 2 and Phase 3 clinical trials, the most frequent adverse events were nausea, flushing, and headache (generally mild in nature).

 

Rekynda has no known alcohol interactions.

 

Advisors

 

Leerink Partners LLC served as financial advisor to AMAG on the transaction. AMAG’s legal advisor was Ropes & Gray LLP. Palatin’s financial advisor for the transaction was Greenhill & Co., LLC and its legal advisor was Thompson Hine LLP.

 

About AMAG

 

AMAG is a biopharmaceutical company focused on developing and delivering important therapeutics, conducting clinical research in areas of unmet need and creating education and support programs for the patients and families we serve. Our products support the health of patients in the areas of maternal health, anemia management and cancer supportive care. Through CBR®, we also help families to preserve newborn stem cells, which are used today in transplant medicine for certain cancers and blood, immune and metabolic disorders, and have the potential to play a valuable role in the ongoing development of regenerative medicine. For additional company information, please visit www.amagpharma.com.

 

About Palatin Technologies

 

Palatin Technologies, Inc. is a biopharmaceutical company developing targeted, receptor-specific peptide therapeutics for the treatment of diseases with significant unmet medical need and commercial potential. Palatin’s strategy is to develop products and then form marketing collaborations with industry leaders in order to maximize their commercial potential.  For additional information regarding Palatin, please visit Palatin’s website at www.Palatin.com.

 

Forward-Looking Statements

 

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Any statements contained herein which do not describe historical facts, including but not limited to statements regarding: AMAG’s anticipated expansion in women’s health through the licensing transaction with Palatin Technologies, Inc. and plans regarding the development activity of Rekynda; the structure of planned and pending Rekynda clinical trials; the expected timeline, indications and expenditures for clinical development and commercialization of Rekynda, including the timing

 



 

for the new drug application (NDA), subsequent regulatory action by the Food and Drug Administration and commercial launch; Rekynda’s strategic fit for AMAG’s women’s health business; the competitive landscape and the breadth of the female sexual dysfunction (FSD) and hypoactive sexual desire disorder (HSDD) markets and Rekynda’s potential benefits and market potential; the expected timing for the closing of the transaction, the timing and value of payments by AMAG under the licensing transaction; and the potential value Rekynda will create for AMAG’s shareholders are forward-looking statements which involve risks and uncertainties that could cause actual results to differ materially from those discussed in such forward-looking statements.

 

Such risks and uncertainties include: (1) the possibility that the closing conditions set forth in the license agreement, including, if required, Palatin’s delivery of any financial statements to be filed by AMAG under Rule 3-05 of Regulation S-X, will not be met and that the parties will be unable to consummate the proposed transactions, (2) uncertainties regarding AMAG’s and Palatin’s ability to successfully and timely complete clinical development programs and obtain regulatory approval for Rekynda in North America, (3) the possibility that significant safety or drug interaction problems could arise with respect to Rekynda, (4) the ability of AMAG to raise awareness and understanding of HSDD and the potential benefits of Rekynda (5) uncertainties regarding the manufacture of Rekynda, (6) uncertainties relating to AMAG’s and Palatin’s patents and proprietary rights associated with Rekynda in North America, (7) that the cost of the transaction to AMAG will be more than planned and/or will not provide the intended positive financial results, (8) that AMAG or Palatin will fail to fully perform under the license agreement, (9) uncertainty regarding AMAG’s ability to compete in the FSD market in North America, and (10) other risks identified in AMAG’s and Palatin’s Securities and Exchange Commission (SEC) filings, including each of AMAG’s and Palatin’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2016 and subsequent filings with the SEC. AMAG and Palatin caution you not to place undue reliance on any forward-looking statements, which speak only as of the date they are made.

 

AMAG and Palatin disclaim any obligation to publicly update or revise any such statements to reflect any change in expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.

 

AMAG Pharmaceuticals® is a registered trademark of AMAG Pharmaceuticals, Inc. RekyndaTM is a trademark of Palatin Technologies, Inc.

 



 

CONTACTS:

 

Investors for AMAG:

Linda Lennox

Vice President, Investor Relations

908-627-3424

 

Media for AMAG:

Katie Payne

Vice President, External Affairs

202-669-6786

 

Investors for Palatin:

Stephen T. Wills, CPA, MST
Chief Operating Officer / Chief Financial Officer
609-495-2200 / info@palatin.com

 

Media for Palatin:

Paul Arndt, MBA, LifeSci Advisors, LLC
Managing Director
646-597-6992 / paul@lifesciadvisors.com