Vectura Group plc Release: Strong Interim Results Driven By 67% Increase In Royalties
Chippenham, UK – 17 November 2015: Vectura Group plc (LSE: VEC) (“Vectura”), which specialises in the development of products for the treatment of airways-related diseases, today announces its unaudited interim results for the six months ended 30 September 2015.
Financial Highlights • Revenues up 35% to £26.1m (H1 2014/15: £19.4m; FY 2014/15: £58.0m) • EBITDA[1] up 57% to £4.7m (H1 2014/15: £3.0m; FY 2014/15: £16.2m) • Loss before tax of £5.0m (H1 2014/15: loss £8.7m; FY 2014/15: loss £6.2m) • Basic EPS loss of 0.7p (H1 2014/15: loss 1.4p; FY 2014/15: earnings 0.9p) • Robust balance sheet with cash and cash equivalents of £78.5m (£90.0m at 31 March 2015) – final payment made to former Activaero GmbH shareholders of €35m in August 2015
James Ward-Lilley, Chief Executive of Vectura: “With my first set of results as CEO, I am delighted to report that Vectura is continuing to make very good progress with robust financial performance reflecting good pipeline progress and significant increases in partnered product sales.
The operational highlights of the first six months of our financial year highlight the sustained manner in which we create value through the application of our unique formulation, device and development expertise in inhaled airways diseases. This includes both novel formulation and device development as well as generic applications of compounds and devices.
Once launched, Utibron™ Neohaler® and Seebri™ Neohaler® will bring a new royalty stream for Vectura and we look forward to confirmation from our partner Novartis in due course on their plans for the commercialisation of these products.
Vectura is progressively building a profitable business with a strong outlook based on its unique expertise in device and formulation development in inhaled airways diseases. This approach has focused on small molecules but now includes biologics that can be delivered via inhalation. Vectura’s platform has been complemented and extended with the AKITA® JET and FOX® nebulised inhalation devices which leverage the FAVORITE technology.
We will continue to maintain a strong technology platform to ensure Vectura remains at the forefront of inhalation science. Our priority remains to build a strong hybrid business model which through partnering, clinical development and progressively building a specialist commercial capability maximises our unique capabilities, manages risk and delivers strong sustained shareholder value.”
Operational Highlights
Partnered marketed products and pipeline programmes
Novartis
• Ultibro® Breezhaler® (indacaterol/glycopyrronium bromide, QVA149) a first-in-class once-daily dual bronchodilator, long-acting beta2-adrenergic agonist (LABA)/long-acting muscarinic antagonist (LAMA), achieved total net sales of $132m within our financial half year (Q2/Q3 2015; as reported by Novartis) generating increased royalty income for Vectura
o The product has been approved in over 80 countries outside the US (including countries in the EU and Japan) and launched in over 40 countries
• Seebri® Breezhaler® (glycopyrronium bromide, NVA237) a once-daily inhaled long-acting muscarinic antagonist (LAMA), achieved total net sales of $76m within our financial half year (Q2/Q3 2015; as reported by Novartis) generating increased royalty income for Vectura
o The product is approved for use in over 90 countries outside the US (including countries in the EU and Japan)
• QVM149 (indacaterol/glycopyrronium bromide/mometasone fuorate) a new inhaled once daily combination triple therapy, (LABA)/(LAMA) and corticosteroid (ICS) for asthma
o Novartis announced a new inhaled dry powder triple therapy for patients with moderate to severe asthma uncontrolled on standard ICS/LABA medication
o First regulatory filings of QVM149 planned for 2018
o Vectura is eligible to receive development, filing and approval milestones. In addition, Vectura will receive royalties on products sales in the event of a successful product launch
Post period event related to Novartis
• Novartis received US FDA approval for the new dual combination bronchodilator Utibron™ Neohaler® (formerly QVA149) and the stand-alone monotherapy Seebri™ Neohaler® (formerly NVA237) for patients with chronic obstructive pulmonary disease (COPD)
o The approval of Utibron™ Neohaler® and Seebri™ Neohaler® triggering a $22.5m milestone payment from Novartis to Vectura
o Novartis expects that Utibron™ Neohaler® and Seebri™ Neohaler® will be available in the first quarter of 2016
o Launch of these products in the US will generate a new royalty stream for Vectura
Ultibro, Seebri, Breezhaler and Neohaler are registered trademarks of Novartis AG. Utibron is a trade mark of Novartis AG. Wholly owned pipeline programmes
• VR647 (SCIPE) (paediatric asthma) – inhaled corticosteroid budesonide delivered with Vectura’s smart nebuliser, the AKITA® JET
o Announced successful pre-IND meeting with the US FDA
o FDA agreed with our intent to rely on the 505(b)(2) pathway for the development programme with the aim of filing a New Drug Application (NDA)
o Filing is anticipated in 2H 2019
Further post period events on wholly owned programme
• VR475 (FAVOLIR)
o Phase III clinical study has been initiated
o First sites opened and patient screening initiated
Partnered pipeline programmes
• VR876 EU, undisclosed partner on pipeline programme for lung disease
o Development milestone triggered a cash milestone payment of €5m (circa. £3.6m) to Vectura. VR876 is being developed by our partner and uses one of Vectura’s smart nebuliser delivery systems. The smart nebuliser delivery system is a hand-held, self-contained, battery powered device that delivers nebulised liquid drugs with high performance using a vibrating mesh technology
• VR315 US, undisclosed partner (potentially highly valuable US respiratory generics programme – asthma and COPD).
o Further cash milestone of $3m triggered by the successful achievement of a development milestone
• VR942, UCB (inhaled, innovative and differentiated biological therapy for severe airways disease)
o Phase I clinical study commenced on this innovative biologic immuno-modulatory product in the area of severe inflammatory respiratory disease
Further post period events on partnered pipeline programmes
• VR632 EU – partner Sandoz (another of Vectura’s generic programmes and second inhaled combination therapy for asthma and COPD delivered using Vectura’s proprietary dry powder inhaler and formulation technology)
o A cash milestone of €0.75m triggered by the successful achievement of a further development milestone associated with VR632 in the EU.
Corporate Governance
• Change to the Board
o In June, the appointment of James Ward-Lilley as CEO and Executive Director of Vectura was announced. James joined Vectura at the end of September 2015.
[1] Earnings before investment income, finance gains/(losses), tax, depreciation, amortisation, share-based compensation, adjusted for non-recurring items.
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Financial Highlights • Revenues up 35% to £26.1m (H1 2014/15: £19.4m; FY 2014/15: £58.0m) • EBITDA[1] up 57% to £4.7m (H1 2014/15: £3.0m; FY 2014/15: £16.2m) • Loss before tax of £5.0m (H1 2014/15: loss £8.7m; FY 2014/15: loss £6.2m) • Basic EPS loss of 0.7p (H1 2014/15: loss 1.4p; FY 2014/15: earnings 0.9p) • Robust balance sheet with cash and cash equivalents of £78.5m (£90.0m at 31 March 2015) – final payment made to former Activaero GmbH shareholders of €35m in August 2015
James Ward-Lilley, Chief Executive of Vectura: “With my first set of results as CEO, I am delighted to report that Vectura is continuing to make very good progress with robust financial performance reflecting good pipeline progress and significant increases in partnered product sales.
The operational highlights of the first six months of our financial year highlight the sustained manner in which we create value through the application of our unique formulation, device and development expertise in inhaled airways diseases. This includes both novel formulation and device development as well as generic applications of compounds and devices.
Once launched, Utibron™ Neohaler® and Seebri™ Neohaler® will bring a new royalty stream for Vectura and we look forward to confirmation from our partner Novartis in due course on their plans for the commercialisation of these products.
Vectura is progressively building a profitable business with a strong outlook based on its unique expertise in device and formulation development in inhaled airways diseases. This approach has focused on small molecules but now includes biologics that can be delivered via inhalation. Vectura’s platform has been complemented and extended with the AKITA® JET and FOX® nebulised inhalation devices which leverage the FAVORITE technology.
We will continue to maintain a strong technology platform to ensure Vectura remains at the forefront of inhalation science. Our priority remains to build a strong hybrid business model which through partnering, clinical development and progressively building a specialist commercial capability maximises our unique capabilities, manages risk and delivers strong sustained shareholder value.”
Operational Highlights
Partnered marketed products and pipeline programmes
Novartis
• Ultibro® Breezhaler® (indacaterol/glycopyrronium bromide, QVA149) a first-in-class once-daily dual bronchodilator, long-acting beta2-adrenergic agonist (LABA)/long-acting muscarinic antagonist (LAMA), achieved total net sales of $132m within our financial half year (Q2/Q3 2015; as reported by Novartis) generating increased royalty income for Vectura
o The product has been approved in over 80 countries outside the US (including countries in the EU and Japan) and launched in over 40 countries
• Seebri® Breezhaler® (glycopyrronium bromide, NVA237) a once-daily inhaled long-acting muscarinic antagonist (LAMA), achieved total net sales of $76m within our financial half year (Q2/Q3 2015; as reported by Novartis) generating increased royalty income for Vectura
o The product is approved for use in over 90 countries outside the US (including countries in the EU and Japan)
• QVM149 (indacaterol/glycopyrronium bromide/mometasone fuorate) a new inhaled once daily combination triple therapy, (LABA)/(LAMA) and corticosteroid (ICS) for asthma
o Novartis announced a new inhaled dry powder triple therapy for patients with moderate to severe asthma uncontrolled on standard ICS/LABA medication
o First regulatory filings of QVM149 planned for 2018
o Vectura is eligible to receive development, filing and approval milestones. In addition, Vectura will receive royalties on products sales in the event of a successful product launch
Post period event related to Novartis
• Novartis received US FDA approval for the new dual combination bronchodilator Utibron™ Neohaler® (formerly QVA149) and the stand-alone monotherapy Seebri™ Neohaler® (formerly NVA237) for patients with chronic obstructive pulmonary disease (COPD)
o The approval of Utibron™ Neohaler® and Seebri™ Neohaler® triggering a $22.5m milestone payment from Novartis to Vectura
o Novartis expects that Utibron™ Neohaler® and Seebri™ Neohaler® will be available in the first quarter of 2016
o Launch of these products in the US will generate a new royalty stream for Vectura
Ultibro, Seebri, Breezhaler and Neohaler are registered trademarks of Novartis AG. Utibron is a trade mark of Novartis AG. Wholly owned pipeline programmes
• VR647 (SCIPE) (paediatric asthma) – inhaled corticosteroid budesonide delivered with Vectura’s smart nebuliser, the AKITA® JET
o Announced successful pre-IND meeting with the US FDA
o FDA agreed with our intent to rely on the 505(b)(2) pathway for the development programme with the aim of filing a New Drug Application (NDA)
o Filing is anticipated in 2H 2019
Further post period events on wholly owned programme
• VR475 (FAVOLIR)
o Phase III clinical study has been initiated
o First sites opened and patient screening initiated
Partnered pipeline programmes
• VR876 EU, undisclosed partner on pipeline programme for lung disease
o Development milestone triggered a cash milestone payment of €5m (circa. £3.6m) to Vectura. VR876 is being developed by our partner and uses one of Vectura’s smart nebuliser delivery systems. The smart nebuliser delivery system is a hand-held, self-contained, battery powered device that delivers nebulised liquid drugs with high performance using a vibrating mesh technology
• VR315 US, undisclosed partner (potentially highly valuable US respiratory generics programme – asthma and COPD).
o Further cash milestone of $3m triggered by the successful achievement of a development milestone
• VR942, UCB (inhaled, innovative and differentiated biological therapy for severe airways disease)
o Phase I clinical study commenced on this innovative biologic immuno-modulatory product in the area of severe inflammatory respiratory disease
Further post period events on partnered pipeline programmes
• VR632 EU – partner Sandoz (another of Vectura’s generic programmes and second inhaled combination therapy for asthma and COPD delivered using Vectura’s proprietary dry powder inhaler and formulation technology)
o A cash milestone of €0.75m triggered by the successful achievement of a further development milestone associated with VR632 in the EU.
Corporate Governance
• Change to the Board
o In June, the appointment of James Ward-Lilley as CEO and Executive Director of Vectura was announced. James joined Vectura at the end of September 2015.
[1] Earnings before investment income, finance gains/(losses), tax, depreciation, amortisation, share-based compensation, adjusted for non-recurring items.
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