Vernalis PLC: Interim Management Statement For the Period to 11 May 2011

May 11, 2011 -- Vernalis plc today publishes its interim management statement for the period 1 January 2011 to 11 May 2011.

Key Events

- On 14 March 2011, Vernalis announced its partner, Chroma Therapeutics Limited had secured a licensing deal with Cell Therapeutics, Inc. (CTI) for tosedostat in North, Central and South America. It was also announced tosedostat has been granted orphan drug status for Acute Myeloid Leukaemia (AML) by both the US Food and Drug Administration and European Medicines Agency. CTI will now be responsible for further development of tosedostat and intends to progress it into Phase III studies of AML in Q4 2011.

- On 16 March 2011, Vernalis announced it had dosed the first subjects in a Phase I trial of V158866, its FAAH inhibitor which has potential application in a wide range of pain and other indications. Dosing of volunteers continues and the trial is expected to complete by the end of the year.

- On 12 April 2011, Vernalis announced it had regained the rights to the Phase I-ready A2A programme from Biogen Idec following a strategic review of their priority programmes. The Phase I trial is expected to start later this year following transition of the programme back to Vernalis.

- Also on 12 April 2011, Vernalis announced its financial results for the year ended 31 December 2010. Key highlights were revenue growth of 9%, a reduction in the loss (before exceptional items) of 75%, underlying net cash burn reduced by 70% to £4.5 million with the Group now debt free and a cash runway through to the end of 2013.

- Also on 12 April 2011, Vernalis’ partner Vernona Pharma plc announced the initiation of an open label Phase II study of RPL554 in patients with mild to moderate chronic obstructive pulmonary disease (COPD). The study will assess the effect of inhaled RPL554 on lung function using FEV1 (Forced Expiratory Volume in 1 second), the standard measure of lung function in this patient group, as well as examining safety using routine safety assessments.

Outlook

Vernalis is financially strong with a cash runway through 2013, excluding any milestones it might earn from its broad development pipeline. Having financially transformed Vernalis over the last two years the Group is now focussed on its acquisition and in-licensing strategy to transition Vernalis into a diversified and self sustaining pharmaceutical company. To this end, we continue to search for the appropriate transactions that will create substantial shareholder value over time.

Enquiries:

Vernalis Contacts

Ian Garland, Chief Executive Officer

+44 (0) 118 989 9360

David Mackney, Chief Financial Officer

Brunswick Group

Jon Coles

+44 (0) 20 7404 5959

Justine McIlroy

Taylor Rafferty

Rob Newman

+44 (0) 20 7614 2900

Faisal Kanth

About Vernalis

Vernalis is a development stage pharmaceutical company with significant expertise in taking promising product candidates along a commercially-focused path to market. The Group has one marketed product, frovatriptan for the acute treatment of migraine, and eight candidates in development, seven of which are designated priority programmes. Four of these priority development programmes are currently unpartnered and three are partnered. Pipeline programmes are derived from both our own research activities where we have significant expertise in fragment and structure based drug discovery, as well as from collaborations. Our technologies, capabilities and products are endorsed by collaborations with Endo, GSK, Lundbeck, Menarini, Novartis and Servier.

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