Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on Vernalis. We currently have 74 research reports from 4 professional analysts.
Avingtrans (AVG LN) Good progress on integration; FY19 PBT raised 13% | Devro (DVO LN) Upgrading to Buy on valuation and recovery grounds | Genus (GNS LN) H1’s in line with expectations: solid ABS performance | Vernalis (VER LN) Tuzistra® XR scrips below guidance: evaluating strategic options
Companies: AVG DVO GNS VER
Vernalis has provided a trading and operational update to its guidance for Tuzistra XR prescriptions for financial year-end 2018. Despite dynamic management of commercial initiatives, Tuzistra XR prescription growth is not accelerating fast enough to meet Vernalis’s guidance of 105-115k prescriptions (given at the FY17 results). Following a disappointing uptake in the current cough cold season (~65% of the season is complete), Vernalis is downgrading guidance on prescription numbers and, in light of slow progress in the US cough and flu business, is seeking alternative strategies for the US business and the group. As such, we place our financial forecasts and valuation under review until we receive clarity on strategic next steps and the potential impact on cash burn, given a cash balance of £44m (unaudited at 31 January 2018).
A look at what brokers are covering today, Thursday December 14.
Advanced Medical Solutions (AMS LN) In line FY trading update | Infrastructure India (IIP LN) NAV declines further - financing discussions continue | IQE (IQE LN) Apple investment in VCSELs highlights upgrade potential | ReNeuron Group (RENE LN) Interim results and IND approved to commence Phase IIb in stroke | Severfield (SFR LN) Significant Google contract confirmed | Synairgen (SNG LN) Revised terms with Pharmaxis | Tribal Group (TRB LN) Financial performance materially ahead | Vernalis (VER LN) Trading update highlights Tuzistra® XR run-rate below expectations
Companies: AMS IQE VER SNG RENE IIP TRB SFR
The shortfall in prescription volume growth volume is disappointing, although we note our cautious stance vs. guidance for current-year prescriptions. We significantly lowered our rollout expectations for Tuzistra® XR and the four follow-on cough cold programmes on 24th November and will review our estimates following this morning’s update. The company enjoys a strong cash position of £48.9m (as per 11th Dec).
Fusion Antibodies— Sch1 from the Belfast based contract research organisation providing services to biopharmaceutical and diagnostics companies that are involved in the development of antibodies for both therapeutic drug and diagnostic applications. Offer to raise £5.5m for the Company and £1.075m for selling shareholders at 82p with market cap of £18.1m. Due 18 Dec | Erris Resources PLC—a mineral exploration and development company currently focused on two geographic areas. Offer TBC, expected 21 December 2017 | CIP Merchant Capital—Closed ended investment Company. Sector focus oil & gas, healthcare, pharma, and real estate. Offer TBA. Due 21 Dec | Panthera Resources— The Company was established to act as a holding company for Indo Gold Limited, an unlisted Australian registered company. The Company aims to explore and develop gold assets in India and West Africa. Offer TBC, expected 20 Dec | Sumo Group—one of the UK's largest independent developers of AAA-rated video games providing both turnkey and codevelopment solutions, including initial concept and pre-production. Offer TBC. Due late Dec | Pelatro—provider of proprietary software solutions to enterprise-level customers for various aspects of precision marketing for use in B2C applications. Offer TBC, expected 19 December 2017 | Fusion Antibodies—contract research organisation providing services to biopharmaceutical and diagnostics companies that are involved in the development of antibodies for both therapeutic drug and diagnostic applications. Raising £5.5m at 82p plus £1.075mn vendor sale. £mkt cap £18.1m Due 18 Dec. | Sirius Petroleum—RTO. Becoming an operating company in the Ororo Field in Nigeria. Raising £7.2m/ Mkt Cap £35.6m. Due 19 Dec. | Bushveld Minerals—RTO of Bushveld Vametco and therefore 78.8% of Strategic Minerals Corporation, the intermediate holding company that owns a 75 per cent. interest in the Vametco Vanadium Mine. | Eqtec—Company with access to a proprietary advanced gasification technology used in industrial size power plants to convert waste into synthetic gas to generate electricity. Raising £1.6m. Mkt Cap £8.7m. Due 21 Dec | Volex VLX.L—The global provider of cable assemblies is proposing to move from the main market to AIM on 19 January. £71m market cap. FYMar18E rev £241.5m and £7.19m PBT | Miriad Advertising—Global video advertising company incorporated in 2015 and is engaged in the development of native invideo advertising. 2016 rev £0.7m and £7.3m operating loss. Offer TBA. Expected 19 Dec | OnTheMarket—Intention to float on AIM to raise c.£50m which will be used to fund the growth of the OnTheMarket.com portal, already the third biggest UK residential property portal provider. Expected valuation £200m to £250m.
Companies: FBT VER OTC MPH UBI PDZ BCN MSYS REAT
Future (FUTR LN) Results underline change and opportunity | IndigoVision Group (IND LN) Trading behind expectations; Chief Exec leaves | James Fisher & Sons (FSJ LN) Outlook unchanged; Offshore Oil recovery delayed | Sanderson Group (SND LN) Scaling up the Enterprise division | Speedy Hire (SDY LN) Earnings enhancing acquisitions | Vernalis (VER LN) Reduction in cough cold forecasts | WYG (WYG LN) UK challenges prompt further downgrades
Companies: SDY VER FSJ IND WYG SND FUTR
Tuzistra XR prescriptions (Rx) grew threefold to ~35k in FY16/17 (2nd year on the market) vs ~12k in FY15/16. Investment into addressing the barriers to higher Tuzistra XR prescribing is translating into higher Rx rates, although this has not been matched by revenue growth due to higher inventory stocking in the same period last year. In H217 FDA issued partner Tris with two complete response letters to Vernalis’s CCP-07 and CCP-08 NDAs and we now model launch during the 2018/19 cough cold season. Our updated forecasts reflect this and lower Tuzistra XR revenues due to a slower than anticipated sales trajectory in the near term.
See what's trending this week...
Futura Medical (FUM LN) H1 results: Eroxon® trial plan amended; licensing discussions underway | Goals Soccer Centres (GOAL LN) Further downgrades overshadow various strategic positives | Murgitroyd Group (MUR LN) Trading in line after record H2 performance | Oxford Instruments (OXIG LN) FY18 guidance maintained, but dependent on stronger H2 | Summit Therapeutics (SUMM LN) BARDA contract a major boost to ridinilazole | Vernalis (VER LN) Solid FY results driven by NCE collaborations; Tuzistra broadly in line
Companies: SUMM VER OXIG GOAL MUR FUM
FY results are ahead of our forecasts, mainly as a result of higher than expected NCE collaborative revenue, with Tuzistra™ XR prescriptions broadly in line. Following Complete Response Letters from the FDA for follow-on cough cold programmes CCP-07 and (post period-end) CCP-08, the share trades near all-time lows. Vernalis is currently working closely with Tris Pharma to resubmit the NDAs as soon as possible. We reiterate Hold.
See what was trending this week...
Earthport (EPO LN) Platform expansion into Nigeria | Surgical Innovations Group (SUN LN) Transformational acquisition of Elemental | T. Clarke (CTO LN) Earnings enhancing acquisition of ETON Associates | Vernalis (VER LN) Complete Response Letter for CCP-08
Companies: VER CTO SUN EPO
Vernalis has this morning announced that it has received a Complete Response Letter (non-approval) from the FDA in relation to CCP-08, its follow-on prescription cough cold medicine for the US market. This follows the CRL for CCP-07 in April 2017 and represents a further significant setback for the group. Vernalis will provide updates on its progress with both products in the coming months. We also continue to look forward to two sets of proof-of-concept data (CCP-05 and CCP-06) later this year.
Vernalis has provided a year-end trading and operational update ahead of its FY17 results due to be announced on 12 September. Total revenues are expected to be ahead of current market expectations, largely due to higher than anticipated R&D-related milestones. This and tighter cost control means that operating loss for the full year is expected to be lower than consensus estimates. In terms of prescription (Rx) growth, Tuzistra XR continued its steady growth in volumes y-o-y; reported net revenue will depend on the impact of rebates and vouchers on gross revenues for the year. Our valuation remains unchanged at £399m (76p per share).
Research Tree provides access to ongoing research coverage, media content and regulatory news on Vernalis. We currently have 74 research reports from 4 professional analysts.
|21Mar18 16:05||RNS||Rule 2.9 Announcement|
|20Mar18 11:29||GNW||Shore Capital Stockbrokers Limited : Form 8.5 (EPT/RI) - Vernalis Plc|
|19Mar18 09:30||GNW||Shore Capital Stockbrokers Limited : Form 8.5 (EPT/RI) - Vernalis Plc|
|16Mar18 09:42||GNW||Shore Capital Stockbrokers Limited : Form 8.5 (EPT/RI) - Vernalis Plc|
|15Mar18 07:00||RNS||Update on Strategic Review and Formal Sale Process|
|02Mar18 16:40||RNS||Second Price Monitoring Extn|
|02Mar18 16:35||RNS||Price Monitoring Extension|
Today’s FY results are in line with our expectations, and emphasise the recently announced shift in strategy in favour of partnered development of inhaled generics. The in–market performance of key value drivers flutiform®, Seebri®, Ultibro® and EXPAREL® has been in line with forecasts, and the ongoing VR475 and VR647 trials (Phase III/EU and Phase II/US respectively) are on track, with top-line data expected in H2. We reiterate our Buy recommendation (we upgraded to Buy on 27th Feb at 72p) and 120p target price.
Companies: Vectura Group
Full-year results were slightly ahead of forecasts, which had been revised following the company’s January trading update that reflected the impact of delays to the start of customer clinical trials. A 2% decline in revenues, due to lumpy contract wins in 2016, masks the underlying 2013-2017 13% CAGR (ex-lumpy orders) and the 33% increase in Service revenues, which were in turn driven by new product introductions (e.g. Cognition Kit/wearable technology for patient-centric real-time self-assessment). The intentional and well-flagged investment in R&D and full-year impact of 2016 sales & marketing increases resulted in the company being broadly EBITDA-breakeven with year-end cash of £1.9m – sufficient for its internal development programmes’ needs. Our new forecasts reflect the adoption of IFRS 15, which has almost no impact on cash projections. We maintain our 155p price target, which implies a FY2019 EV/Sales ratio of 3.1x.
Companies: Cambridge Cognition
Reckitt has pulled out of the race for Pfizer’s consumer health business, leaving GSK as the only reported bidder. It needs to be seen if new names crop up before today’s deadline for offers, but the likelihood is less, given that the likes of Nestle, J&J and Sanofi have reportedly pulled out already. If no other players turn up, Pfizer will have to sweeten its terms, or might decide to retain the business for now, or might be forced to look for newer options for disposing the business, including a part-sale. The business is currently being valued at $15-20bn.
EKF has reported a strong set of figures, slightly ahead of expectations. Revenues increased 8% to £41.6m and the margin profile of the business has been transformed, with gross margins significantly improved and EBITDA +52% to £9.3m. With the recovery phase now complete, attention is turning to driving the next leg of growth. We see a number of short and medium term growth opportunities over and above our published forecasts although, as ever, precise timing and quantum is uncertain.
Companies: EKF Diagnostics Holding
Oxford BioMedica’s full year results highlight the continued step up in bioprocessing and commercial development income, increasing 36% in the year, as the facilities operate close to capacity. The group announced on Friday that it had raised £20.5m to fund the expansion of its bioprocessing facilities as it continues to focus on establishing additional deals with its LentiVector® platform (as evident by the most recent deal with Bioverativ). The group’s partnered product pipeline continues to progress and we look forward to the additional expected approvals of Kymriah® later in the year.
Companies: Oxford Biomedica
OptiBiotix Health Plc (LON:OPTI) focuses on managing and treating widespread, chronic medical conditions, such as obesity and high cholesterol, through the modulation of the human microbiome.
Companies: Optibiotix Health
Anpario’s full year results highlighted a period of strong growth with momentum reportedly continuing into 2018. The group remains focused on building strong commercial relationships with end users and we expect the initiatives to help the group deliver our 11% sales growth estimate in 2018. We make modest adjustments to our forecasts this morning and increase our Target Price by 2p to 434p. We remain at Hold.
- Genedrive's PLC (LON: GDR) HepC test just entered the commercial phase as partner Sysmex launched in EMEA and APAC territories in recent weeks - Re-design of the mTB test in progress, launch date to be announced in the next fiscal year - Discussions for the disposal of the Services business entered an exclusivity period, expect an update by the end of June - Careful cash management with a £3.9mln cash balance at the end of February, we would expect a capital raise in the second half of calendar year 2018
What with North Korean missiles whistling over Japan, supreme leader Kim Jong Un threatening nuclear war against America and numerous other terrorist attacks, the world is undoubtedly a dangerous place. Demonstrated again just a fortnight ago, after a ‘lone wolf’ ISIS extremist, managed to explode a home-made ‘pipe-bomb’ in a busy New York underpass near Times Square.
Companies: Kromek Group
2018 is the year of the Great Exhibition of the North. This summer, Newcastle and Gateshead will play host to a government-sponsored, 80-day marathon of events. Billed as the largest event in England this year, the Great Exhibition will showcase the best of the North East’s art, culture, design and innovation and we expect it to highlight the region’s ongoing success in high-end engineering, technology and life sciences. It may also reflect on the success of the North East’s plcs, the most striking example of which is Sage’s transition from 1980’s start-up to £9bn FTSE100 stalwart. We remain on the look out for the next Sage and expect the region to continue to produce attractive IPO candidates following Ramsdens’ success last year. Overall 2017 was a positive year for the region’s listed companies, one highlight of which was the takeover of Quantum Pharma, an N+1 Singer client, by Clinigen for £150m. We are confident that 2018 will be another successful year. Our top regional picks this year are Hargreaves Services, Zytronic and Applied Graphene Materials.
Companies: AGM BWY GRI GRG HSP IDH KMK NTG RFX UTW VNET ZYT
In the March 2018 edition of the Hardman Monthly Newsletter, Nigel Hawkins addresses the attractions of quoted infrastructure funds that maintain a low profile.
Companies: OPM ABZA AVO AGY APH ARBB AVCT BNO BUR CMH CLIG COS DNL EVG GTLY GDR INL MCL MUR NSF OBT OXB PPH NIPT PHP RE/ REDX SCLP SCE SIXH TRX TON VAL
Pharmaceutical Services is a vast and varied landscape, reflecting the complexities in the discovery, development, manufacturing and monitoring of drugs and devices, all within a stringent regulatory environment. The overall growth prospects are highly favourable: drug development activity globally is on the up, led by smaller companies, which is driving demand for outsourced services. In this report we provide a breakdown of the sector into its main activity segments, and identify biologics, increasing service specialisation and consolidation as important value drivers. Finally, we present 15 companies (9 of which are publicly listed) that, in our view, are well placed to benefit from the sector’s secular growth trends.
Companies: ABZA BQE CSRT OXB INS UDG CLIN ABZA HZD ERGO
Verona Pharma continues to announce highly encouraging trial results with RPL554 with the most recent in 10 Cystic Fibrosis patients. We note RPL554 has so far been evaluated in multiple Phase I and Phase II trials and over 700 patients. We update forecasts this morning following FY 2017 results and continue to look forward to the upcoming Phase IIb data in COPD in early Q2. Following which, we anticipate more detail on the development pathway for RPL554. We reiterate our Strong Buy recommendation and upgrade our Target Price from 327p to 348p.
Companies: Verona Pharma
The marketing authorisations in Ukraine (the 16th largest egg producing country worldwide) represent an important step in the global rollout of Aivlosin® as a treatment of choice for a variety of respiratory and enteric infections in pigs and poultry. We reiterate our positive stance and continue to expect Aivlosin® to generate strong growth in multiple geographies.
Companies: Eco Animal Health Group
GSK’s Q4 results were ahead of our as well as the street expectations. Forex had a negative impact of 3ppts on sales and 4ppts on adjusted EPS. All segments outperformed sequentially, but vaccines stood out with 9% growth (vs flat Q3). The main drivers included HIV in pharma, flu and meningitis in vaccines and international markets in the consumer health business. Management maintained interest in consumer health assets but ruled out a compromise on the pharma focus.