Verona Pharma plc

Q4 2022 Earnings Conference Call


spk_0: welcome to the brunt of farmers fourth quarter for your twenty twenty two financial resulting operating highlight conference call at this time all participants are listen only mode earlier this morning drawn a farmer issued a press release nothing it's financial results for three months and for your ended december thirty first twenty twenty two a poppy can be found the of assimilation stop or the corporate website toby toby toby doctor wrote a form of that time before we begin i'd like to remind you that during today's called think about the companies to transportation plan and prospects are forward looking statements before looking statements are based on management expectations be statements army their promises no guarantees and involved known and unknown risks and changes and other important factors that may cause our actual resort results for much more she's mostly really different from our expectations expressed or implied by the fourth looking statements any such looking for looking statements for better management estimates of the others conference call one company male looked up such woo hoo statement at some point in the future it screams any obligation to do so even a subsequent events cause it's used to change as you're gonna do this cause being recorded to remain available for ninety days i've not looked in nepal of doctor david zappa delhi chief executive officer
spk_1: thank you and welcome everyone to the days off with me today are maar khan our chief financial officer dr cathy record or chief medical officer and chris martin or senior vice president commercial
spk_0: twenty twenty two was a momentous year for their own a farmer and first and foremost for the millions of patients suffering from feel pity photo by the groundbreaking results from our pay three enhance trials we believe anti pension if approved has the potential to change the treatment paradigm for see ltd
spk_1: we're on track to submit a new drug application to the up to a in the second quarter of twenty twenty three over the past year we announced positive topline results from our base three enhanced trials evaluating nebulizer see pension or the maintenance treatment of c o p d in moderate to severe c o p d pace nc pension successfully met the primary endpoint in both enhance one an enhanced to demonstrating statistically significant and clinically meaningful improvements in lung function as well as remarkable reduction in rate and risk of exacerbations the success of these trials advances us closer to providing and see pension to a patient population in urgent need of new effective treatment option additionally the strong clinical data allowed us to significant strengthen our financial position to end up size one hundred fifty million dollar equity offering in august and a one hundred fifty million dollar non deluded debt financing facility with absurd finance in october as well as through march third
spk_0: fifty eight point six million dollars from eighty of sales under our a t m program
spk_1: with that said let me take a step back and provide a brief review of are enhanced program
spk_0: as a reminder the enhanced one and enhance to trial where each designed to enroll approximately eight hundred moderate to severe symptomatic feel bd subject for a total of approximately sixteen hundred subjects across sites primarily in the united states and europe
spk_1: the trials replicated measurements of efficacy and safety over twenty four weeks enhanced one also evaluated longer term safety in approximately four hundred subjects over forty eight weeks subjects received empty pension or placebo as either therapy or added on to a single long acting bronco dilate with approximately sixty nine percent of subjects across enhanced one and fifty five percent in enhanced to be receiving either a llama long acting must reddick antagonist or lava long acting
spk_2: beta agony
spk_1: additionally approximately twenty percent of subjects and enhance one and fifteen percent in enhance to received inhaled corticosteroids with contaminant lama or lab
spk_0: as previously announced both the enhance one enhanced to trial successfully met primary and key secondary and point demonstrated to physically significant improvements in lung function
spk_1: in addition and the pension substantially improved symptom and quality of life as well as reducing the rate and risk of ceos pt exacerbations in both trial
spk_0: and was well tolerated over twenty four and forty week importantly pooled exacerbation data from enhance one and enhanced to demonstrated that nc central treatment resulted in a statistically significant forty percent reduction in the rate of feel pity and that's or basin compared with placebo over twenty four weeks
spk_1: further and see fences significantly decrease the risk of an exacerbation as measured by time to first exacerbation when compared with placebo by forty one percent
spk_0: based on the study population we believe this magnitude of reduction and back to base and rate and risk is unprecedented in phase three c pt trials and further validates the importance of nc pension novel mechanism delivering nonsteroidal anti inflammatory activity in addition the bronco dilation
spk_1: for the treatment of patients with c o p d i'd also like to reiterate the consistency of the positive results between enhance one and enhanced to trials the totality of the data from both studies coupled with favorable safety points profile of in from support our belief that and defense and book change the treatment paradigm for seattle pd with as positive data and hand we plan to submit an md da to the f t a in the second quarter of this year
spk_0: in parallel are pre commercially commercialization efforts and us launch activities are proceeding as planned following are strong and hands to data in august we began filling key leadership position the cross commercial h r i t and funny we are accelerating our efforts as we prepare for and the a submission and beyond and we are confident that we will be well positioned for a potential us lot of empty pension in twenty twenty four turning to our global partnering strategy and twenty twenty two new ones farmer received clearance from china center for drug evaluation they begin phase one n p three studies of nc penchant for c o p d in china
spk_1: as a reminder nuance karma is responsible for developing and commercializing and see pension and greater china and as such a will pay play a key role in addressing the global need for a novel treatment for c o p d we look forward to providing further updates as the study's progress
spk_0: currently more than three hundred and eighty million patients suffer from seattle pd worldwide and it is the third leading cause of death despite the availability of existing feel pity treatments approximately fifty percent of patients experience symptoms for more than twenty four days per month and positions require a new and affected feel therapy to provide relief to their patients
spk_1: with it's novel mechanism of of action as has selected td three am pt for inhibitor we believe and defend friends yep approved will be groundbreaking in the field of feel bd management
spk_0: we expect twenty twenty three to be another pivotal year for their owner as we advance towards our mission a delivery and see pension to patients with the ltd i will now turned pall over to mark to review our financial results for twenty twenty two
spk_3: thank you dave good morning
spk_0: we ended twenty twenty two with two hundred and twenty seven point eight million dollars in cash and equivalents thirty in january we ran the a two year program through last friday and during that time we raise net proceeds of approximately fifty six point nine million dollars after giving effect to the proceeds from the hm facility are pro forma cash and equivalents and december thirty one twenty twenty two was two hundred and eighty four point seven million dollars between the cash currently on hand expected receipts from the uk tax credit program and funding expected to be available under the one hundred and fifty million dollar oxford loan facility we believe our cash runway will extend through at least the end of twenty twenty five including the plan commercial launch of nc veteran in the united states for the year ended december thirty one twenty twenty two the net loss after tax and sixty eight point seven million dollars compared to a net loss after tax a fifty five point six million dollars for the prior year the last and twenty twenty two was higher primarily due to forty million dollars of not recurring revenue related to the nuance agreement which more than offset the higher already spend twenty twenty one this represents a loss of thirteen cents for ordinary shares or a dollar for for a d s for the year compared to loss of twelve cents for ordinary share or ninety six cents for a d as in twenty twenty one research and development costs were forty nine point three million dollars for the year ended december thirty one twenty twenty two compared to seventy nine point four million dollars reported for the or twenty twenty one the decrease was primarily due to lower clinical trials and other development costs of twenty seven point nine million dollars resulting from the enhanced studies nearing completion in twenty twenty two and a four point two million dollar decrease in share based compensation charges telling general and administrative expenses or twenty six point six million dollars for the year ended december thirty first twenty twenty two compared to thirty three point nine million dollars reported for the prior year the decrease of seven point three million was primarily due to lower share based compensation charges the uk rd tax credit for twenty twenty two was nine point six million dollars compared to a predator fifteen point six million dollars for the year ended december thirty first twenty twenty one the decrease of six million dollars is in line with are lower qualifying are the expenditure in turn would be enhanced program in twenty twenty two oh now turned the call back over to the operator
spk_3: for the queue and eight
spk_0: we will now begin the question and answer session that's across the of stars than one a little phone keypad if using a speakerphone to speed up the handset before pressing the keys to which are police decided to at this time will pause monitors and more sir our first question will come from andrea's rg right with went to securities you may not ahead the morning and thanks for taking your question or just one for much here so was sanofi regeneron of god at the top line results in the see through studied depicting and moderate to severe c o p d type to information later this month okay well we spoken with have about a twenty percent reduction and exacerbations has been clinically meaningful which is well below the forty percent and suffering from showed so curious to get your thoughts on the read and what impact positive data may have on that commercial landscaping and send your positioning and exacerbations good morning andreas san thanks for the question
spk_1: i'm a has capita to give her perspective as the upon the knowledge esta time none depicts and then and it's impact on a know overall i think that you know were intrigued by the study but i think you need to keep in mind that the patient population is certain much more limited
spk_0: then that we address was empty central
spk_1: and so we don't really see a big impact but cathy we want to comment on
spk_0: door well as as that they said the population be different because this would be a much smaller populations feel for the patients in general they're looking for patients who have high it's nfl himself for them without actually having a part of palm funny i can tell you all the difference putin generally they're looking at a nice air yeah
spk_4: effects patience for that and certainly twenty percent might be good in that population is too seriously taking a whole bunch of other medications also so what's remarkable about and he ventured is that we have about forty percent in a total feel be a population so it doesn't matter whether you have i used in a folder now
spk_0: not what he has been titus or not whether you're on steroids or not we see this remarkable decrease in exacerbation in a general see of the population so i think that's what makes a difference between and he center and and looking at a compound like to pick them
spk_4: he would just i could follow their woods
spk_1: other day i didn't to me to pick some may be on the market would that impact or and any pricing especially given the
spk_5: that the benefit that and essentially shown exacerbations compared to er to the and hello crazy one commenter and general on where we are facing he i can do that andrea the think when we think about pricing with that he felt when we we view the current nebulizer products as a outside of of baseline for for as the banter and ah you know those products at a time we want will be somewhere around fourteen hundred dollars a month on your one of the things that we realize that you just mentioned there that the the results on exacerbations are very impactful not only to a physician community but the pair community and was when we talked to payers today with in medicare part d medicare advantage they expect as he enters the be priced at a premium versus those current products i think some of the other dynamics that we added play as we think about placing are the an impact of the inflation reduction act and and that legislation on how he might have the best going into the market but the important thing here is that the profile of as a pattern which provides a braga dilation improvements and symptoms and the marketable market written result on exam
spk_4: for base and provide a lot of price flexibility for us as we think about what that value would be as we get a large so you know i think i think we we feel very confident that as the better value is great within the marketplace and we also feel like i'm up here perspective the rebel receptivity eu pricing as better at a premium versus the current product
spk_0: is is a very positive reception as well okay great congressional the progress and thanks to address our next question will come from june me was true securities you may not go ahead
spk_6: the morning this is awesome on prejean thanks for taking the questions first question by the engaged wondering how the any the is going
spk_1: and then also wondering you know what's the reason is that the getting european part on board your strategy for your european regulatory process
spk_0: and for that thank you door thanks so much work for the question the india is progressing know very well and that's been guided were tracking to i had a solution in the second quarter all the components said to lead piano are coming together not only course the clinical which is always important and down in this case it was one of the rate limiting stat but also course they can see the not clinical and other aspects of the and and the a so we're very pleased where we're at with it and i'm looking forward to that submission
spk_1: as far as far as partnering goes in our strategy remains the same are and that we're looking to partner and people entering outside the united states
spk_0: as you know we have done that already in greater china with me once pharma and he knows these conversations are all he knows different as partners are just went their needs are different their side their scope excedrin and so some of these timings you know we can't control other than done sticking with our strategy which we're very confident in and so i expect a partner in the be a focus of twenty twenty three as i've mentioned before and we look forward to updating every one end zone
spk_7: as we have more to to report on partnering but it definitely articulated strategy
spk_8: thank you our next question will come from tom schrader was pretty i g i
spk_1: i don't worry thanks for taking the questions
spk_5: some general questions do you expect to launch on approval to expect that will be your level of preparedness and then for chris can you give us a sense of what a good pay or acceptance ramp would look like in this area where a little less experience what what what should you have in terms of i would say at a year something like that and then also do what do you expect for the copay to be for this drug thank you the crazy wanna go ahead to take those a tom out of start on our launched on approval across the organization yeah we've been working a very comprehensive launch reading this plan planet that involve not only the commercial departments but as they mentioned talk hundred bucks support commercial ah as we get ready for launch including cm to the finance our and that planet progressing very well and we are planning to launch as soon as possible after look at our after approval or it gives it a important point that once we get approval we will have to get product into the channel at does take a couple you know a couple weeks and that we also will be hiring wraps at the time of approval we're not going to bring rob zombie for approval so there will be raining but our planet the launch as quickly after approval as possible the organization is are working towards those plans and and we're in a very good shape the large as quickly as possible after approval as far as your second question on pair acceptance i think it's really important to think about it to confront differently than what you typically haunches today because launches today typically launch with medicare part d as and dog commercial are and those those paired failed tend to have very tight restrictions for new products a lot as he confronts primary reimbursement channel medicare part d as in boy and we know within medicare part d that are as access will be available at launch for physicians and we can see that with what will happen with you police are you powering a very high access and acceptance rates at launch with are you powering in that channel and that cause the products be able to be used by the physicians are there are some important steps that we have to go ru within the medicare part d channel but you know those are things that were working on today those include ensuring that were covered under existing coverage policies which we believe that will be the case with mp bedroom we also or are establishing and getting our paperwork ready for products specific jacobs that jacobs mission will go and immediately upon approval
spk_7: and then we we should expect to get that products specific a code within a within three to six months in the meantime you use the existing nonspecific diego to get coverage and get payment for to the pharmacy so we feel very very confident that and people from coverage and overall
spk_5: ability to be used by the position is going to be high at launch and i throughout the first year the other side of that stories what you discuss their would a co pays for patients and we will we look at the medicare part d channel and medicare in general we see for the nebulizer products over the last year that eighty percent of the patients are paying less than ten dollars for their prescriptions of nebula branded nebulizer products this is the extra
spk_0: really attractive proposition for physicians not only do they get access but they have lower out of pocket costs so i think those dynamic allow us to be very excited about how we anticipate the uptake for and three bedroom to be when we launched in two thousand twenty four
spk_9: and maybe just one quick clarification you can talk to pay years before approval or does everything start that approval
spk_1: a we we can have we can ever really discussions with payers before approval
spk_9: you know some of the that is about the disease date and their needs but we can have early discussions with pairs as we as we move through the process thank you
spk_0: based on or the on the funeral costs increased was started one or next question will come from google on patios yeah i'm with a c wainwright know overhead hi this is the bottom can hear me okay yes perfectly
spk_1: i played are so the money on thanks for taking your questions are you from us
spk_0: i'm successfully can you speak to how efficiently incidents in can be manufactured and expected clogs related to traditional lama lama therapeutic
spk_10: sure i'll make a general statement comes on cog you know and prevention small molecule
spk_0: and manufacturing has been very well sorted over the years
spk_11: you believe me am extremely efficient
spk_0: the manufacturing process would be drunk substance or a t i the drug product in manufactured a book feel seal
spk_12: in two
spk_9: place to camp yours again or processes very well described and done and burberry comfortable with the scale of them has occurred
spk_1: and i think the costs again in line with other products that are many factors in same way of marking want to come
spk_9: yeah i'll just echo your comments day that it is small molecule so are you know the cost of manufacturing firms are generally fairly consistent across compounds
spk_0: and you know i think least expect or think about cogs is you know from single digit percentage of sales police were manufactured cox
spk_1: or a great on what busy the role of combination with his mana canopy for intervention in your estimation
spk_0: well as being makes i understand the question are you are you asking how often do you would see it in combination
spk_1: or maybe to clarify your question
spk_0: yeah because picked a combination
spk_1: and yes well you know i think that and it and he saw the trial you know and to countries that used and can be used at manoa therapy ah as well as we studied in combination with lama lama
spk_0: i think it works in all these settings
spk_1: and even in addition to i see us so we're very comfortable with and he reduce along the complete treatment paradigm in a deal to the and that's why i mentioned by the barks that because it it's a sad
spk_0: both and efficacy and safety and overall benefit the risk
spk_1: we think empty federal going to change exactly how and how she'll be treated intimacy and antrim have utilized
spk_11: earlier in the treatment paradigm
spk_9: and we think the avoiding i see as is always have a positive attributes
spk_13: especially those patients who don't require i see us
spk_0: in addition those that are on a triple therapy who admittedly limited to know other choices and century again with it's benefits of us can play a role in helping
spk_1: don't know space and so
spk_0: we see it used the little you know everywhere again the treatment paradigm
spk_1: one final question from me so given us a sense of cash balance and recent success of intervention program can you talk about the city decreasing for the company of the next three to five years this sure
spk_6: you know very very good question
spk_0: clearly as the than coke is stones in the past two three years
spk_1: execution on and see central personal p d has been critical and will continue to be so so i'm in the short term of course we have an india a medium term we're looking for approval and launching the a police state as imagine that to be groundbreaking ah the field of snow pd and we look forward to helping them invitation some with the tension in that space typically and the less than also throughout the world and i think that's an incredible opportunity own the coming years in addition to that we have mentioned previously we are moving forward and in the early stages of a combination of product development of a llama potency central new to think next incredible amount of sense we know the field is set up the combination therapy
spk_0: well as well and look forward to updating everybody on the progress of that in addition of course and the country
spk_14: as a lot of opportunity and other respiratory diseases have much for example
spk_15: cystic fibrosis possibly ikea and so there are a lot of opportunities for us to school we are looking to
spk_0: a our partnership strategy with regard to the other indication because they will probably and cool
spk_16: the other delivery device is them de ayer dpr with leveraging partners experience or own proprietary devices makes a lot of sense
spk_1: and so we look forward to expanding into the center indication via partnership primarily loud continued to create the value from blown farmer two and two countries feel the and the nebulizer room and and as much as is a combination product development
spk_17: i'd say out some thanks for taking the questions
spk_5: thanks so much our next question will confirm yards mean rahimi was piper sandler he will not go ahead hi guys this is lara not for yeah as just a few question the first are based on physician feedback at the moment which patients what they want to put on a suspension and then second had pairs comments and all about the potential francis enter into reduce overall crpd healthcare utilization or is the focus more now in short term thing the chris you want to take down those two i can do that certain large banks for the question i think what we only think about er physician feedback and the market research with which we've done which is very extensive i think in the past year we talked to well over two hundred positions are both pulmonologist primary care physicians but also nurse practitioners mph and the thing that they can to real it or eight thousand this idea that nc patronage they've talked about can be used very broadly across the treatment paradigm reiterate that that you know if we look at patient better they have today and their back as many of them remains symptomatic and at risk for exacerbations and the addition of a new mechanism to these patients with something they haven't been able to do and fourteen plots fourteen to twenty years so this gives them ability to do something very different so we think about how many patients are treated today we know these about eight and a half million treated patients we also know that there's about six million of those patients on what you would consider the and he has trial population which is either lama or lava or law buys the of patience and in those days you positioned adding an event going on and of at a very high rate the other group of patients or what they described earlier which are these patients on do dual brother dilate or triple therapy where the physicians have no options and we know these patients are still symptomatic and innovations the physicians look at mt run as an ad on as well at a very high res in those patients because it gives them the ability a layer on an additional mechanism
spk_0: it to them to the patients that could provide them this early and sustained response on bravo dilation symptom and then the risk and rate of exacerbation so we feel very confidently based on the market research and our interactions with can allow them and people from the you broadly across the patient popular a son and really changed between them paradigm that that is occurring within feel pity that i think your second question was around payers and lpr utilization know i think that's when we go back to question earlier which is around pricing one of the reasons why the payers are believing nc center and would be priced at a premium versus the car products is because of that benefit that i'm that have on exacerbations and potentially or overall health care or utilization with their within their within their plan we know that feel he is a high burden to the payer in the system i think this and the another the dilapidated sack over fifty billion dollars worth of in director direct costs associated with the obedient publications of feel pity so the ability for mp bantering to reduce the rate and risk of exacerbations and help improve patient symptoms and lung function is a very attractive or benefits so they're not looking at at it

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