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Paladin Labs is focused
on making a difference in patients lives by bringing innovative drugs to
their customers in the Canada
Paladin Labs Inc.
Suite 102, 6111 Royalmount Avenue
Montreal, QC Canada H4P 2T4
Ms. Samira Sakhia
Chief Financial Officer
Interview conducted by:
Lynn Fosse, Senior Editor
Published - January 18, 2007
SAMIRA SAKHIA Chief Financial Officer
Ms. Sakhia brings to Paladin extensive experience, including various positions of
leadership at Discreet Logic, where she served as Controller of North American Operations,
Manager of International Financial Reporting (Montreal, Quebec), and European Financial
Manager (London, England). Prior to working at Discreet Logic, Ms. Sakhia worked at Arthur
Andersen & Co. in audit.
Ms. Sakhia has received a BComm in Finance and Accounting, and a MBA in Strategy and
Marketing, all from McGill University. Ms. Sakhia is also a Chartered Accountant.
Paladin was founded in 1996 with virtually no products and no money, but there was a
clear vision to establish the Company as Canadas first specialty pharmaceutical
company. Paladins strategy is to acquire and commercialize innovative
pharmaceuticals for the Canadian market--products that improve the health of Canadians.
At September 30th, 2006, we have over 50
products, $48 million in cash with no liabilities, a rich pipeline of promising new
therapeutics, and a business that has grown at a compounded annual growth rate of 18% over
the past 5 years. Most importantly, our products are making a difference in the health of
Canadians. Case in point, Plan B® is the only approved emergency contraceptive
for sale in Canada. While every multi-national company with an interest in womens
health turned this product down, Paladin leaped at the opportunity to acquire the license
for Plan B®. Canadian women now have more options as a result of our
efforts to make Plan B® available without a prescription. Seasonale®
is another product that will improve the health of Canadian women. Seasonale®
is pending regulatory approval in Canada, and stands to be the first extended regimen oral
contraceptive. A woman using Seasonale®, as the name implies, would only have
4 menses a year, one per season. Seasonale® will be a viable solution for the
many women who suffer from painful monthly menstruation.
CEOCFO: Ms. Sakhia, what attracted you to the Paladin?
Ms. Sakhia: I met with Jonathon Ross
Goodman our President & CEO and Mark Beaudet, V.P of Sales and Marketing, whom I found
extremely impressive, and I admired all that they had accomplished to date. More
specifically, they had interesting managerial styles and had a clear vision of where the
Company was heading.
How long have you been with the Company?
Ms. Sakhia: I started in July 2001
when Paladin was 35 people and had $12.5 million dollars in revenues. Now, 5 1/2 years
later, the Company is nearly 70 people and will generate over $45 million dollars in
What was the vision when you started and where are you today?
Ms. Sakhia: The vision was to become a
leading specialty pharmaceutical company. Put another way, the goal was to build a
successful organization in specialized therapeutic areas. We are currently present in the
categories of urology, endocrinology, womens health, allergy and most recently pain.
While we have acquired many new products, the management has been diligent in
ensuring that we did not take excessive financial risks. Over the last 10 years, we have
deployed our resources very effectively, which is something we continue to do.
Paladin focuses on innovative products; how do you define innovative?
Ms. Sakhia: We define innovative as
something that has a unique product offering. Innovative could be something as basic as
pricing or a completely new therapy, even if it is for one of our smaller product
categories, but brings a lot of difference to the patients lives. Take for example
Twinject. Consistent with the Companys strategy, we signed a deal with Verus
Pharmaceuticals Inc. of San Diego to launch Twinject®. Twinject®
is indicated for the treatment of severe allergic reactions, known as
anaphylaxis and is the first improvement to the Epipen® in over 20 years. This
innovative product has already captured over 10% of the Canadian market share in only 12
months since the launch. One reason for its astounding success lies in the fact that
we have managed to break an existing 20 year old monopoly through innovation. Unlike
EpiPen®, Twinject® has two separate doses of the antidote
adrenaline (epinephrine) in a single one injector unit. Studies have shown that about 25%
to 30% of the estimated 600,000 Canadians at risk for anaphylactic shock require a second
dose of epinephrine. Before Twinject®, patients had to carry two Epipen®
units with them at all times. Today they can carry one Twinject®. In addition,
Twinject® is priced the same as one Epipen®, thus patients are
receiving the 2nd dose free. We are confident that this innovative packaging
will save lives. We launched Twinject® into the $25 million epinephrine
auto-injector market last year and already have captured double digit market share.
As you continue to grow your stable of products does it get easier to get each one
introduced, recognized and used?
Ms. Sakhia: It becomes easier to bring
new products on internally. We understand the process of launching and introducing
products and we know where resources need to be allocated. However, industry regulations
continue to change, requirements continuously change and the environment remains very
competitive. We have a great team of marketers and sales people and they continue to
excel, but there is no exact formula to ensure that it will work every time. We have to
look at each products attributes and figure out the best way to market and sell
You have several ways of acquiring, developing and licensing products; will you tell us
the different ways of doing this, and how you decide to take on any of the different
Ms. Sakhia: We dont do
traditional R&D at Paladin. We leverage the R&D capabilities of our partners to
bring innovative products to Canada. Over the past 10 years, we have become the
partner of choice for European and American pharmaceutical companies wanting to enter the
Canadian market. Specifically, we have assembled over 25 different partners ranging from
some of the largest pharma companies in the world (like Pfizer, with whom we have a
successful co-promotion agreement) to the smallest, like Valera from whom we licensed
Vantas®, their one year LHRH agonist implant, for the treatment of prostate
cancer. With our own licensing advisory board, we maintain a leading edge in the
scientific and clinical evaluation of new products, which enables us to maintain an
enviable product pipeline. In fact, over the last two years, Paladin has successfully
licensed-in or acquired over ten new products from seven different technology partners.
While multi-nationals in a good year launch one or two products, in 2005 Paladin launched
two new products, and has another five in the pipeline waiting to be approved by Health Canada.
Do you develop much internally?
Ms. Sakhia: Paladins development
strategy is to develop products that are near-term, low expense and low risk. In 2004, we
developed a womens health product that is equivalent to a non-patented womens
health product. Our product, PAL1, has been submitted to Health Canada and we expect
to obtain regulatory approval in 2007.
You are one of the leading specialty pharma companies in Canada; will you tell us about
the specialty pharma industry in general and what sets you apart from your competitors?
Ms. Sakhia: We focus on the products
as opposed to being focused on a specific therapeutic. If it makes sense to bring a
product to Canada, we will look at it and see what we can do. We will invest in a brand if
it makes a difference in the lives of patients. This gives us a credibility that maybe
other companies do not possess since they may be focused on a therapeutic. We have been
successful despite some product failures, but overall we have been very good at acquiring
or in licensing products. Over the last 10 years, Paladin has not missed an opportunity to
acquire a new product.
Are people coming to you at this point?
Ms. Sakhia: Yes, especially since we
have diverse product categories. Biotech and regional pharmaceutical companies who
want to launch their products in Canada will come see us and pitch us their products based
on our areas of focus. Essentially they are impressed with our ability to launch new
products, our financial strength and our successful history.
Will you tell us about the financial picture of the company?
Ms. Sakhia: We have a great financial
picture. I do not know too many companies that have posted record revenues every year of
their existence. The Company has a very healthy balance sheet. Even as we acquire more
products and invest in the products, the base business is very strong and generates a
positive cash flow. In 2005, we invested nearly $10 million in acquisition of products but
we generated an equivalent amount of EBITDA.
What is ahead for Paladin?
Ms. Sakhia: We will continue to
acquire more products, grow the Company, and become more efficient. We will perfect our
strategy. While we continue to grow, we maintain a lean structure. Our size has often been
a major advantage. In fact, our partners appreciate our size, and the fact that
senior executives are readily accessible.
Are there areas where you would like to gain a concentration in?
Ms. Sakhia: From the beginning we were
concentrated in urology, endocrinology, and womens, but and at the end of last year,
we added an allergy category with Twinject®. With the additions of Metadol®,
Vicoprofen® and Pennsaid®, a pain and central nervous system
category has been created.
Do you sell differently in the urban market vs. the rural market?
Ms. Sakhia: The sales strategy is to
focus on physicians who have the most potential. If it is a rural physician and he or she
is a high prescriber of a urinary incontinence product like Oxytol®, then we
will call on him. If he is not a high prescriber of any of the products we promote, then
we will reach him indirectly through direct mail, sampling programs and conferences.
In closing, why should potential investors be interested and what should they know that
might not jump off the page when they first look at the company?
Ms. Sakhia: Paladin is a great
company, a great company to work for, and a great company to invest in because we are
rapidly growing and we are very diligent about how we acquire products. We pay a lot of
attention to the bottom line. Our future is clear: we will continue to execute our
strategy of bringing innovative pharmaceuticals to the Canadian market. Based on Twinject®,
Plan B®, Oxytrol® (for overactive bladder), Seasonale®,
Pennsaid®, Metadol® (for osteoarthritis of the knee), our business
is projected to double over the next 3 years. We have a strong balance sheet and an
aggressive business development group whose mandate is to in license additional products
to further ad to our growth. In addition to our dedication to patients and our
shareholders, Paladin is committed to giving back to community. In fact, the Company has
donated millions of dollars of product to Health Partners International, Centraid (United
Way) as well as to a host of other charities. This is something I am particularly proud
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