Vernalis — H1 FY2017 Earnings Presentation
36 slides from Vernalis's earnings presentation, Feb 21, 2017
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Slide 2: Interim Results Presentation, 6 months ended 31 December 2016
Vernalis plc Interim Results Presentation 6 months ended 31 December 2016 Ian Garland, CEO David Mackney, CFO 21 February 2017
Slide 3: Important Disclaimer
Important Disclaimer The distribution of this presentation in certain jurisdictions may be restricted by law, and persons into whose possession this presentation comes should inform themselves about, and observe, any such restrictions. Although reasonable care has been taken to ensure that the facts
Slide 4: Agenda for today's presentation
Agenda for today’s presentation 1. Highlights 2. Strategy 3. Commercial update • Tuzistra® XR • Moxatag® 4. Financial results 5. Newsflow 6. Summary 4 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 5: Highlights
Highlights 5 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 6: Highlights
Highlights Encouraging progress in our US commercial business: • Tuzistra® XR: Prescriptions increased almost six-fold to 11,586 for the six months to 31 December 2016 (2015: 1,976) Insurance coverage and pharmacy stocking increased Sales-force expanded to 100 sales representatives Sales-for
Slide 7: Highlights (continued)
Highlights (continued) Maturing Cough Cold Pipeline: • CCP-07: NDA submission June 2016, accepted for review September 2016 PDUFA date 20 April 2017 • CCP-08: NDA submission October 2016, accepted for review December 2016 PDUFA date 4 August 2017 • CCP-05 & -06 Active development ongoing w
Slide 8: Highlights (continued)
Highlights (continued) Other operational highlights: • Frovatriptan: Royalties remain robust since the initial step down in price and volume following generic competition in December 2015 Underlying half-year net sales to 31 December 2016 were €8.7 million (30 June 2016: €8.6 million & 31 Decemb
Slide 9: Highlights (continued)
Highlights (continued) Financial performance: • Total revenue of £5.6 million (2015: £6.1 million): £0.9 million of US commercial sales (Tuzistra® XR and Moxatag ®) recorded on a ‘delivered to wholesaler’ basis £3.2 million of Research collaboration income (2015: £3.8 million) £1.5 million of
Slide 10: Strategy
Strategy 10 | 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 11: Strategy
Strategy 2) Realise value from NCE pipeline 1) Develop, acquire and commercialise low development risk late stage products 3) Continue balanced investment in research 11 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 12: Commercial update
Commercial update • Tuzistra® XR • Moxatag® 12 | 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 13: Cough cold season
Commercial business | Cough cold season CDC data indicate a more severe cough cold season in 2016-17 Source: CDC FluView site – data through to 11h February 2017 13 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 14: Cough cold season
Commercial business | Cough cold season CDC data also indicate there are currently high levels of ILI across much of the US Source: CDC FluView site – data through to 11h February 2017 14 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 15: Cough cold season phasing
Commercial business | Cough cold season phasing Weekly phasing of historical narcotic cough cold prescriptions July to January to Season December June 2014-15 44% 56% 2015-16 44% 56% 2016-17 (MAT) 41% Source: Vernalis analysis of IMS TRx data 15 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 16: 2016-17 priorities
Commercial business | 2016-17 priorities In September 2016 we outlined our priorities for 2016-17 2016-17 priorities Supply & • Tris, 3PL and wholesale • Maintain routine supply through to Wholesaler distribution wholesalers • New pharmacy incentives to boost stocking • Pharmacy stocking • Maintain
Slide 17: 2016-17 mid-season progress
Commercial business | 2016-17 mid-season progress We have made good progress against ALL of our 2016-17 priorities 2016-17 mid-season progress Supply & • Tris, 3PL and wholesale • Routine supply maintained Wholesaler distribution • Pharmacy stocking • Shipped to 9,000+ pharmacies since launch Patien
Slide 18: 2016-17 mid-season progress: weekly TRx growing strongly
Commercial business | 2016-17 mid-season progress Weekly TRx growing strongly in 2016-17 Source: IMS & Bloomberg Symphony weekly TRx data, Vernalis analysis 18 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 19: 2016-17 mid-season progress: coupon data
Commercial business | 2016-17 mid-season progress Latest coupon data indicates strong growth is continuing Source: IMS & Bloomberg Symphony weekly TRx data, weekly coupon data & Vernalis analysis 19 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 20: Top territories are validating our cough cold strategy
Commercial business | 2016-17 mid-season progress Top 15 territories are validating our cough cold strategy Source: IMS weekly TRx by territory for last full week prior to Christmas, annualised using weekly seasonal weighting • Top 15 sales territories account for ~50% of our current annualised run-
Slide 21: Regional and territory data is validating our strategy
Commercial business | 2016-17 mid-season progress Regional and territory data is validating our strategy Regional Annualised Run-Rates Territory Annualised Run-Rates Source: IMS weekly TRx by territory or region for last full week prior to Christmas, annualised using weekly seasonal weighting • Many
Slide 22: Region #1 shows what can be achieved in 12-months
Commercial business | 2016-17 mid-season progress Region #1 shows what can be achieved in 12-months Source: IMS weekly TRx by territory for last full week prior to Christmas, annualised using weekly seasonal weighting • Tuzistra® XR promotion initiated beginning of September 2015 • In the last full
Slide 23: Region #1 has risen from 5th to top ranked region
Commercial business | 2016-17 mid-season progress Region #1 has risen from 5th to become the top ranked region • Annualised TRx run rate (= weekly TRx / Weekly Phasing %) 2015-16 2016-17 2016vs2015 Rx range # of Reps Avg Rx Rx range # of Reps Avg Rx Growth 0–100 TRx 0 – 77 11 31 34 – 40 3 37 100–1,0
Slide 24: Progress being made across all 2016-17 priorities
Commercial business | 2016-17 mid-season progress Progress being made across all 2016-17 priorities • Marketing messages: Unaided awareness is growing Physician feedback on new marketing messaging is very strong • Consistent positive patient experiences • Pharmacy stocking: Target pharmacies i
Slide 25: Sales volumes reflect growth in pharmacy stocking and consumption
Commercial business | 2016-17 mid-season progress Sales volumes reflect growth in both pharmacy stocking and patient consumption Source: Vernalis analysis of sales volumes, IMS TRx and wholesaler data 25 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 26: Cough cold pipeline
Commercial business | Cough cold pipeline CCP-07 and CCP-08 continue their progress towards potential 2017-18 season launches • Excellent progress made on both CCP-07 & CCP-08 during the year: • Both NDAs filed and accepted by FDA, currently under review • CCP-07: PDUFA date 20 April 2017 • CCP-08:
Slide 27: Moxatag
Commercial business | Moxatag® Positive developments with project to secure ongoing supplies • Securing ongoing source of supply: Project to secure new source of supply progressing to plan Suir site in Ireland has been acquired and there are plans to re-open it We have held early conversations
Slide 28: Financial results 6 months ended 31 December 2016
Financial results 6 months ended 31 December 2016 28 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 29: Financial highlights
6 months ended 31 December 2016 - Financial highlights H1 H1 to Dec 16 to Dec 15 £m £m Total revenues 5.6 6.1 US Commercial revenue 0.9 0.6 Research collaboration income 3.2 3.8 Frovatriptan royalty 1.5 1.6 Other Collaboration income - 0.1 Operating costs (21.7) (19.0) Operating loss (16.9) (13.5) L
Slide 30: Key cash flow movements
6 months ended 31 December 2016 - Key cash flow movements 90.0 80.0 £4.4 £1.1 £0.4 70.0 £13.4 £2.3 60.0 50.0 £m £84.0 40.0 £74.2 30.0 Cash utilised in business £14.2m Underlying net cash burn £12.3m 20.0 Decrease in reported cash £9.8m 10.0 0.0 Opening cash 1 Jul Cash utilised by Tax and interest Co
Slide 31: Impact of currency movements
Impact of currency movements for 6 months ended 31 December 2016 Cash holding by currency 31 December 2016 GBP • Majority of cash remains denominated in USD • £4.4 million unrealised fx gain on Euro retranslation of cash balances during the 6 US$ months ended 31 December 2016 • 8% movement in USD an
Slide 32: Financial guidance for 12 months to 30 June 2017
Financial guidance for 12 months to 30 June 2017 • Revenue • Tuzistra®XR and Moxatag® sales on a ‘delivered to wholesaler’ basis • Lower net $ per Rx in year to 30 June 2017 • Moxatag® launch on a restricted basis for 2017 • Annualised run-rate of Tuzistra®XR at end of June 2017 will provide more me
Slide 33: Newsflow
Newsflow 33 21 Feb' 17 Interim Results Presentation 31-Dec-16
Slide 34: Potential newsflow | Commercial business
Potential newsflow | Commercial business Event Expected Timing Commercial update: End of 2016-17 Season Tuzistra® XR update June/July 2017 Potential new product approvals: CCP-07 PDUFA date 20 April 2017 CCP-08 PDUFA date 4 August 2017 Cough cold pipeline: CCP-05 proof of concept 2017 (CY)
Slide 35: Summary and outlook
Summary and outlook • Our transition from development stage to full commercial company continues • 2016-17 sees further significant investment in US infrastructure while we build operational effectiveness and grow US commercial sales • Our cough cold pipeline is maturing well: • Both CCP-07 & CCP-08
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