3 April 2012 -- Vernalis plc (LSE: VER) today announces its results for the year ended 31 December 2011 and subsequent events.
Operational Highlights
Licensing deal and Fundraising
• Licensing deal with Tris Pharma, Inc. completed February 2012, giving Vernalis exclusive rights to Tris’ extended release technology for use in the US prescription (Rx) cough/cold market
• £65.9 million (net of expenses), over subscribed, equity fund raising
• 80% for the Tris deal
• Remaining funds available for further late-stage in-licensing
• Vernalis will pay Tris to develop up to six unique extended release (ER) equivalents to existing immediate release (IR) prescription cough/cold treatments
• Vernalis will own all approved products and will commercialise them in a US market with approximately 35 million prescriptions annually, potentially worth over $2 billion
• Development work already initiated on three combination products
• Accelerates Vernalis’ evolution to self-sustained specialty pharma company
Pipeline Activity
Frovatriptan (marketed) (Migraine):
• Royalty income £6.5 million (2010: £7.0 million)
• Approval received to market frovatriptan in Russia
• Launch of frovatriptan in South Korea by SK Chemicals
• Three batches of API anticipated for shipment to Menarini in 2012, consistent with 2011
Tosedostat - CHR2797 (Cancer):
• Licensing deal signed by Chroma Therapeutics for North, Central and South America (March 2011)
• Orphan drug status for AML granted by the FDA and EMA (March 2011)
• Positive Phase IIb data presented at ASCO (May 2011)
• Phase III study in myelodysplastic syndrome to be initiated in H2 2012
AUY922 (Cancer):
• Continues in multiple Phase I & Phase II studies
• Included for the first time in Novartis’ selected pharmaceutical pipeline projects chart (July 2011)
HSP990 (Cancer):
• Continues in maximum tolerated dose (MTD) Phase I study
V158866 (Pain):
• Phase I trial initiated (March 2011) and successfully completed with positive results (September 2011)
• Aim to publish Phase I results at pain conference this year
V81444 (Parkinson’s Disease):
• Rights successfully regained to A2A Parkinson’s programme from Biogen Idec (April 2011)
• Phase I study initiated (August 2011)
V158411 (Cancer):
• Phase I enabling pre-clinical studies in cancer completed (February 2012)
• Partnering process initiated and ongoing
RPL554 (Asthma/Allergic Rhinitis):
• Verona to initiate Phase II anti-inflammatory study with results expected Q4 2012
Research collaborations:
• New collaboration announced with Genentech (January 2012)
• New collaboration announced with Servier, in addition to two existing collaborations (January 2012)
• Two milestones earned from the collaboration with Lundbeck (September and December 2011)
• Extension and expansion of the first collaboration with Servier and milestone achieved (October 2011)
Financial Highlights
· Revenues remain robust
o £12.2 million of revenues (2010: £14.2 million)
o Menarini frovatriptan royalties £6.5 million (2010: £7.0 million)
o Underlying sales of frovatriptan €27.1 million (2010: €31.3 million) down 13.4% due to price reductions in Germany in H2 2010, (excluding Germany sales down 4.3%)
o Collaboration and deferred income excluding clinical milestones £5.7 million (2010: £5.0 million) including £1.1 million of research collaboration milestones (2010: £0.6 million)
ß No clinical milestones in 2011 (2010: £2.0 million with AUY922 progressing into Phase II)
· Focused spend and tight control of overheads
o R&D costs increased to £13.6 million (2010: £11.7 million) primarily due to investments in V158866 and V81444
o Underlying G&A costs decreased by £0.4 million.
· Strong balance sheet positions the Company for future growth
o Cash resources (including cash, cash equivalents and held-to-maturity financial assets) of £24.7 million at 31 December 2011 (2010: £30.9 million)
o Further £65.9 million (net of expenses) raised via Firm Placing, Placing and Open Offer in February 2012
· Loss before exceptional items for 2011 increased to £6.4 million (2010: £2.8 million)
· Loss after exceptional items for 2011 decreased to £7.7 million (2010: £19.7 million)
· £1.2 million milestone from Ipsen as final consideration on sale of US commercial business in 2008 (shown as exceptional income from discontinued operations)
· Underlying annual net cash burn increased to £6.0 million from £4.4 million
· Move to AIM announced March 2012 following the Firm Placing and Placing and Open Offer Expected Newsflow
· Initiate multiple cough/cold pipeline programmes with Tris
· V158866 (Pain) – initiate partnering or Phase II POC studies
· Tosedostat - CHR2797 (Cancer) – initiate Phase III
· V81444 (Parkinson’s disease) – complete Phase I & initiate receptor occupancy study
· AUY922 (Cancer) – Multiple Phase I & II study results (Novartis) (timing not disclosed)
· HSP990 (Cancer) – establish MTD and start Phase II (Novartis) (timing not disclosed)
Ian Garland, Chief Executive Officer, commented, “The transformation of Vernalis has continued. Our licensing deal with Tris, announced in February, together with the £65.9 million equity fundraising are important steps to transform the company into a diversified, profitable and self-sustaining specialty pharmaceutical company. The outlook for 2012 remains very positive with progress expected under the Tris collaboration, where development work has already started on three combination products, as well as our existing programmes and research collaborations.”
Presentation & Conference Call
Vernalis management will host a presentation at 09.00am (UK) at Brunswick’s offices, 16 Lincoln’s Inn Fields, London WC2A 3ED today. It will also be available via webcast at http://www.vernalis.com/investor-centre/presentations-and- webcasts and www.cantos.com and via conference call, which can be joined by dialling: 020 3140 0668, Passcode: 226634#.
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
Kristin Shine
Taylor Rafferty
Rob Newman +44 (0) 20 7614 2900
Faisal Kanth
About Vernalis
Vernalis is a revenue generating development stage pharmaceutical company with significant expertise in drug development.
The Group has one marketed product, frovatriptan for the acute treatment of migraine, an exclusive licensing agreement to develop and commercialise multiple novel products focussed on the US prescription cough/cold market as well as eight programmes in its NCE development pipeline. Vernalis has significant expertise in fragment and structure based drug discovery which it leverages to enter into collaborations with larger pharmaceutical companies. The Company’s technologies, capabilities and products are endorsed by collaborations with Endo, Genentech, GSK, Lundbeck, Menarini, Novartis, Servier and Tris.
For further information about Vernalis, please visit www.vernalis.com
Vernalis Forward-Looking Statement
This news release may contain forward-looking statements that reflect the Company’s current expectations regarding future events including the clinical development and regulatory clearance of the Company’s products, the Company’s ability to find partners for the development and commercialisation of its products, as well as the Company’s future capital raising activities. Forward-looking statements involve risks and uncertainties. Actual events could differ materially from those projected herein and depend on a number of factors including the success of the Company’s research strategies, the applicability of the discoveries made therein, the successful and timely completion of clinical studies, the uncertainties related to the regulatory process, the ability of the Company to identify and agree beneficial terms with suitable partners for the commercialisation and/or development of its products, as well as the achievement of expected synergies from such transactions, the acceptance of frovatriptan and other products by consumers and medical professionals, the successful integration of completed mergers and acquisitions and achievement of expected synergies from such transactions, and the ability of the Company to identify and consummate suitable strategic and business combination transactions.
