James Mullen, CEO of Biogen

This is a partial transcript from Your World with Neil Cavuto, October 27, 2003, that was edited for clarity.

Watch Your World w/Cavuto weekdays at 4 p.m. and 1 a.m. ET.

NEIL CAVUTO, HOST: Biogen’s stock soars Tuesday after announcing earnings that were well above Wall Street estimates. Increased sales and revenues helping to boost the company’s bottom line.

Joining me now for more about the results and Biogen’s outlook, Biogen’s chief executive, James Mullen.

OK. I always say when I have Jim on the show I have multiple sclerosis, I take his drug, Avonex.

And, Jim, good to have you.

JAMES MULLEN, BIOGEN CHIEF EXECUTIVE (BGEN): Good to be here.

CAVUTO: Avonex is strong. Sales up 14 percent in the latest period. There had been concern about rival Serono (SRA). But that appears to have been much ado about -- I’m not saying nothing but certainly not as much as something. What do you make of that?

MULLEN: Well, it’s been 18 months since Rebif came on to the marketplace, and Avonex has really performed much, much better than most people expected, and our marketing and sales group’s done an excellent job sustaining that brand. We had good growth in the U.S. and excellent growth internationally.

CAVUTO: You know, if there another side to this, Jim, that people are now heightening awareness to neurological ailments, like multiple sclerosis, that it’s helping both you have, you clearly more than the Rebif makers.

But more people are examining symptoms or strange occurrences in their bodies and some are realizing that they have MS, and that’s what’s benefiting you?

MULLEN: Well, that’s been a trend over the last number of years, with the introductions of new medicines that are really medicines to treat this MS for the first time.

Really the diagnosis is coming much, much earlier, and neurologists are really pushing patients to get on therapies earlier and the evidence is there that that really helps their long-term outcome.

So it is helping everybody, and, you know, the science continues to advance and, hopefully, new products as well.

CAVUTO: You have, obviously, a number of products down the pipeline, and one that’s getting a lot of appreciative support right now, present treatment for psoriasis, that is Amevive, where the sales were a little bit less than what Wall Street thought they would be, still respectable but less than what the Street thought. That gets back to this argument that Avonex is your one trick pony. You’ve heard that question again and again and again. Dissuade me I’m wrong.

MULLEN: Well, you know, Avonex didn’t become a billion-dollar drug the first year we launched it. In fact, if I recall, we sold about $60 million or $70 million that first year.

We’ll sell you know, something in the range of $50 million at the end of this year, probably into a little bit tougher market because just of the reimbursement really environment that’s out there and the competitive environment.

I think we’re making good progress on it, not as fast as I’d like to see. But this will slowly develop into, I think, an important product, and we just have to get it out there so patients and physicians can see how it works.

CAVUTO: A lot of those patients are finding drugs, such as yours, easier to get north of the border, cheaper to get north of the border. It’s one thing that’s sort of been a cloud over the industry as a whole and a worry for your industry. Is it still?

MULLEN: Well, it’s a problem generally in pharmaceutical industry. I don’t think it’s impacted quite so much the biotech or the specialty products like ours, and there really isn’t a price differential between the Canadian market and the U.S. market for something like Avonex.

CAVUTO: Can you see that happening, though, Jim? If people will find, all right, well, they’ve got this nationalized health system up in Canada that will afford me an opportunity, let’s say, to get an Avonex cheaper than I can in the U.S.?

MULLEN: Well, absolutely. You see the trend. You see it in the news every day. I think it’s a big concern for the pharmaceutical industry. You even hear the commissioner talking about it in different ways.

And I think the whole industry is really got to take a somewhat different approach to our whole pricing policy because, to a certain extent, the U.S. consumer is funding research and development around the world, and everybody else is getting a free ride, and we’re going to have to really even out the pricing policies to make that more what equitable to the U.S. consumer because they’re understandably upset by this.

CAVUTO: All right. James Mullen, thank you very much. Always good seeing you.

MULLEN: Thank you.

CAVUTO: The CEO by Biogen, James Mullen, joining us today.

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