946840--3/2/2009--VIROPHARMA

related topics

{product, candidate, development}

{product, liability, claim}

{property, intellectual, protect}

{stock, price, share}

{tax, income, asset}

{provision, law, control}

{cost, operation, labor}

{customer, product, revenue}

{acquisition, growth, future}

{product, market, service}

{condition, economic, financial}

{capital, credit, financial}

{personnel, key, retain}

{debt, indebtedness, cash}

{operation, international, foreign}

{stock, price, operating}

We have historically depended heavily on the continued sales of Vancocin. If we are unable to successfully commercialize Cinryze, or are significantly delayed or limited in doing so, our business will be materially harmed. Our long-term success depends upon our ability to develop, receive regulatory approval for and commercialize drug product candidates and, if we are not successful, our ability to generate revenues from the commercialization and sale of products resulting from our product candidates will be limited. The regulatory process is expensive, time consuming and uncertain and may prevent us from obtaining required approvals for the commercialization of our product candidates. Because the target patient population for Cinryze is small and has not been definitively determined, we must be able to successfully identify HAE patients and achieve a significant market share in order to maintain profitability. Our core patent protection for Vancocin has expired, which could result in significant competition from generic products and lead to a significant reduction in sales of Vancocin. A competitor has submitted a biologics license application with the FDA for a product candidate for the acute treatment of HAE. If we are not first to receive FDA approval of Cinryze for the acute treatment of HAE, the Orphan Drug Act may provide a competitor C1 Inhibitor product with up to seven years of market exclusivity in the acute indication. We do not know whether Vancocin will continue to be competitive in the markets which it serves, nor do we know if Cinryze will be, or will remain competitive in the markets which it is intended to serve. We have limited sales and marketing infrastructure and if we are unable to develop our own sales and marketing capability, we may be unsuccessful in commercializing our products. The distribution of our commercial products is dependent upon a limited number of third party service providers and disruptions in these relationships could result in our failure to achieve the sales of our products that we expected. We currently depend, and will in the future continue to depend, on third parties to manufacture raw, intermediate and finished goods for Vancocin, Cinryze and our product candidates. If these manufacturers fail to meet our requirements and the requirements of regulatory authorities, our future revenues may be materially adversely affected. If supplies of U.S. human plasma are interrupted or if we are unable to acquire adequate supplies of U.S. human plasma to meet demand for Cinryze, our ability to maintain inventory levels could suffer and future revenues may be delayed or reduced. Cinryze is derived from human plasma, and is therefore subject to the risk of biological contamination inherent in plasma-derived products. This risk could adversely affect our ability to obtain raw materials and market our products. We may be subject to product liability claims, which can be expensive, difficult to defend and may result in large judgments or settlements against us. In order to continue to expand our business and sustain our revenue growth, we will need to acquire additional marketed products or product candidates in clinical development through in-licensing or the acquisitions of businesses that we believe are a strategic fit with us. We may not be able to in-license or acquire suitable products at an acceptable price or at all. In addition, engaging in any in-licensing or acquisitions will incur a variety of costs, and we may never realize the anticipated benefits of any such in-license or acquisition. There are many potential competitors with respect to our product candidates under development, who may develop products and technologies that make our products and/or technologies non-competitive or obsolete. Any of our future products may not be accepted by the market, which would harm our business and results of operations. The current credit and financial market conditions may exacerbate certain risks affecting our business. Funding, especially on terms acceptable to us, may not be available to meet our future capital needs because of the deterioration of the credit and capital markets. Our strategic plan may not achieve the intended results. We depend on collaborations with third parties, which may reduce our product revenues or restrict our ability to commercialize products, and also ties our success to the success of our collaborators. If we fail to comply with our obligations in the agreements under which we license development or commercialization rights to products or technology from third parties, we could lose license rights that are important to our business. Many other entities seek to establish collaborative arrangements for product research and development, or otherwise acquire products, in competition with us. If we are unable to obtain reimbursement for Cinryze from government health administration authorities, private health insurers and other organizations, Cinryze may be too costly for regular use and our ability to generate revenues would be harmed. Historically, Vancocin has been subject to limitations on the amount of payment and reimbursement available to patients from third party payors. Our successful commercialization of our product candidates will depend, in part, on the availability and adequacy of third party reimbursement. We rely on our employees, consultants, contractors, suppliers, manufacturers and collaborators to keep our trade secrets confidential. We depend on patents and proprietary rights for our products which are in clinical development, which may offer only limited protection against potential infringement, and if we are unable to protect our patents and proprietary rights, we may lose the right to develop, manufacture, market or sell products and lose sources of revenue. If our licensors do not protect our rights under our license agreements with them or do not reasonably consent to our sublicense of rights or if these license agreements are terminated, we may lose revenue and expend significant resources defending our rights. We depend on key personnel and may not be able to retain these employees or recruit additional qualified personnel, which would harm our ability to compete. Even after regulatory approval is received, as with Vancocin and Cinryze, if we fail to comply with regulatory requirements, or if we experience unanticipated problems with our approved products, they could be subject to restrictions or withdrawal from the market. Our future product revenues from sales of Vancocin and Cinryze could be reduced by imports from countries where similar products are available at lower prices. Risks associated with our international business relationships could materially adversely affect our business. If we are not successful in integrating Lev into our business, then the benefits of the acquisition will not be fully realized and the market price of our common stock may be negatively affected. Charges to earnings resulting from the application of accounting methods may adversely affect the market value of our common stock as a result of the acquisition of Lev. If Lev stockholders sell the ViroPharma common stock received as consideration in connection with the merger, such sales could cause a decline in the market price of our common stock. Our indebtedness and other financial obligations may harm our financial condition and results of operations. Our stock price could continue to be volatile. As of February 25, 2009 our market capitalization is less than our book value. As a result, we may be required to take a significant non-cash goodwill impairment charge and may be required to write off goodwill or other intangible assets in the future. If we are required to write off goodwill or other intangible assets, our financial position and results of operations could be adversely affected. The rights that have been and may in the future be granted to holders of our common or preferred stock may adversely affect the rights of other stockholders and may discourage a takeover. The convertible note hedge and warrant transactions may affect the value of the senior convertible notes and our common stock. The fundamental change purchase feature of the senior convertible notes may delay or prevent an otherwise beneficial attempt to take over our company.

Full 10-K form ▸

946840--3/2/2009--VIROPHARMA_INC