Vernalis Share Discussion Threads

[fhmktg] 06/3/2017 11:57

Somebody is building a stake, 400k bought this morning.

[romeike] 01/3/2017 10:55

Unfortunately thin news flow until June may not provide the necessary interest needed to improve the share price beyond pre-update levels but there is the possibility of early resolution to the moxatag supply issue and further research milestones. Most other news expected H2.

[fhmktg] 28/2/2017 16:22

Chunky buying today.

[fhmktg] 24/2/2017 15:49

And continuing!

[fhmktg] 24/2/2017 13:59

Some serious buying going on today!

[romeike] 23/2/2017 12:13

I doubt there is more to fall, I expect the share price to gradually recover to same level as before the results, about 32p. The results raised more questions that answers as is so common on AIM but the company is in a decent financial position and has everything to play for still.

[romeike] 22/2/2017 17:04

Support being sorely tested today. Having watched the webcast I was left wondering what Ian Garland was being paid for. He sounded to me like he'd just been pulled off the golf course. At least the CFO had a clue what was going on.

[novandi] 22/2/2017 01:22

Think this stock has some way to fall in short term but is also good value for the long term. There are several opportunities for good news in the next 6 months with milestones being reached and final accounts.

For those asking the same question I was about sales growth disproportionate to revenue growth of Tuzistra XR. My thoughts from research:

There are 2 issues at play:

1)You can take the view the disproportionate growth is because Vernalis are giving it away. My thinking is management realised original price was uber-inflated and corrected by pricing at market value. Quick, crude math with Tuzistra Interim sales figures:
- £600k for 1976 prescriptions of cough medicine means VER expect revenue from a single prescription to generate a cool £300 - yes for cough meds, hi-tech cough med yes, but nonetheless.
- The recent interim result of £800k for 11,586 prescriptions would generate £70 per prescription. This is evidenced in two major price reductions since launch to help sales team shift volume
- The sales growth is not simply price driven, there has been an improvement in the sales setup with the operation having been rebooted. The previously bloated and under-performing sales team has been shredded to a leaner size with more experienced individuals. Also important to note, lessons learnt from this launch should benefit future product launches in the US.
- There are more factors (only half way through flu season being an obvious one), but with common sense and basic math one can surmise VER misdiagnosed the supply demand curve.

2)FDA approved Tuzistra XR and, a few months later approved competitor product Tuxarin ER (US version of keeping the game fair?). Ofcourse this placed downward pressure on Tuzistra sales and contributed to retail price discount. Both products are licensed for 18 years old and more. Interestingly, the FDA recently began disciplinary proceedings against Tuxarin manufacturer for failing to disclose this age requirement on its packaging/sales material. The manufacturer will likely be required to repackage all brand materials according to its license and pay a form of a fine.

This should be good news for VER which will probably be evidenced in full year report. Penalising a dishonest competitor should return significant market share which it deserves ... so long as, without a competitor, it doesn't fall into the greed trap and charge your average American $400 for cough medicine again.

[romeike] 21/2/2017 19:01

I haven't watched the investor webcast yet, has anyone heard any certain explanation as to how prescriptions can rise 600% and yet revenue barely rise at all. Other than sales people giving the stuff away for free...

[bountyhunter] 21/2/2017 18:17

...and today was certainly a 'thin' day! could do with less of those; although good news could no doubt be transformational these biotechs all seem to be taking ages to deliver :-(

[fhmktg] 21/2/2017 16:59

No net growth in value since mid 2014 and the 'new' strategy announced.The full season report on Tuzistra's performance must be seen as a key test of the board's turnaround to move into a tough US business sector, such as the prescription cough and cold market. Everything to play for but we don't want to be seen as yet another pipe dream play in the long British Biotech saga.Dr Fellner please note! We have stuck with you through thick and thin!

[fhmktg] 21/2/2017 14:17

BTG has suffered a similar experience launching novel products into the US health sector.Learning the behaviour of the insurers and the incentives needed to gain acceptance by health professionals is a timely and costly exercise!The gradual reduction in codeine formulations over time is a further complication.Still at least the lessons being learned with Tuzistra can be helpful with the next two products and the final pair in 2018/9.A speedy agreement with the new owners of Suir is a must because FDA approval of the new production might be a formality, but it still has to be gone through.

[romeike] 21/2/2017 13:58

It does suggest a lot of sales may have been through the affordable access route with revenue therefore delayed and/or reduced.

[pugg1ey] 21/2/2017 12:27

prescriptions increase six fold yet revenue generated goes from £600K to just £800K. Are they giving them away?

[romeike] 21/2/2017 10:34

Referring back to the influenza spread map of the US for this season, the spread kicked in around Christmas and doesn't looked like it has peaked yet, March is often the worst month. This fairly supports an expectation that prescriptions will be back loaded in the season with, if consistent with the prior year, perhaps 84% of full year prescriptions occurring in Jan/Feb/Mar.

This if course highlights the importance of the 2017 launch of Moxatag and sorting out supply issues to reduce the seasonal nature of the revenue stream from Tuzistra XR. Progress on Moxatag is not referred to in the release, hopefully more information released on that very soon.

[romeike] 21/2/2017 09:47

It is important to note that four of those months were pre-season.

Last year 16% of sales occurred in the first period and 84% in the second. If that same pattern continued then the FY prescriptions would be 60k-70k, which is a decent improvement on 12k in the full launch year, if not quite the performance I was hoping to see.

Not quite sure about the share price reaction, it is down just 5p at the moment, not terrible and the trades seem to be a mixed picture that includes a number of large buys. The current level seems to have reasonable support.

[woodcutter] 21/2/2017 09:44

11586 prescriptions in six months seems pretty insignificant to me given the size of the market, share price reaction tells the story imv.

may see it drop further yet aimho

woody

[romeike] 21/2/2017 09:43

Quite a mix of buys and sells this morning, seems the market is unsure what to make of these results. I was hoping to see a clear indication of progress on sales but I guess we need to see results for the second half of the season to get a better idea on how well they are doing with Tuzistra XR. The prescriptions increase is encouraging but 2K per month seems well below what should be possible at this stage given that the US has had a very severe flu season this year.

[fhmktg] 21/2/2017 08:23

Vouchers to be given to the pharmacy in return for a significant discount.

[john4242] 21/2/2017 08:07

A 600% increase sounds a lot but the significance would depend on where you start from, the outlay required to get these increases, and the price that Vernalis are getting for these prescriptions. Does anybody know what the "patient assistance program is" because that has increased ?

[romeike] 21/2/2017 08:03

Cantor Fitzgerald on Tuesday retained Vernalis PLC’s analyst rating as ‘Buy’ with its price target of 101 highlighting a potential increase of 208.4% from Vernalis PLC’s current price of 32.75.

[romeike] 21/2/2017 07:37

A 600% increase in prescriptions is hardly to be sniffed at.

[fhmktg] 21/2/2017 07:24

A 'keep the faith' statement. It will need steady nerves to hold for the next 12/24 months.