Earnings call transcript Q2 2023

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Operator

Welcome to Verona Pharma Second Quarter 2023 Financial Results and Operating Highlights Conference Call. At this time all participants are in listen-only mode. Earlier this morning, Verona Pharma issued a press release announcing its financial results for the 3-months ended on June 30th, 2023. A copy can be found in the Investor Relations tab on the corporate website, www.veronapharma.com.

Before we begin, I’d like to remind you that during today’s call, statements about the company’s future expectations, plans and prospects are forward-looking statements. based management’s are expectations. statements forward-looking on current the These the and promise, and important These expectations and expressed cause statements. from neither for materially guaranteed to factors results, involves be achievements may in other statements are the and be known different performance uncertainties unknown that forward-looking implanting actual risks, Any such call. existing management date the forward-looking on statements represented conference of this

so, any point elect if do the such some future, update cause may events views even at to change. in company obligation it its declaims While statements forward-looking the to subsequent to

will As available now call a conference Zaccardelli, reminder, is this turn Officer. to XX being over would recorded I Executive and Dr. David Chief remain days. to the for like

David Zaccardelli

Mark Chief Chief Rickard, Commercial. Hahn, Dr. Kathy Thank President Officer; Senior Medical Officer; our call. you, and welcome, are to Financial our everyone, Chris of today’s Vice Martin, and our today With me

of ensifentrine submission to During of patients the with the substantial ensifentrine NDA nebulized of our towards maintenance submission second new we for quarter, treatment bringing COPD. COPD to FDA progress for a The drug is goal made the X,XXX on the of We working an the successful Phase approximately ensifentrine clinical third forward X look comprised update the FDA quarter. studies, submission including the data and with data in from program the and to safety ENHANCE from other subjects. providing application

of trial health and from X clinical of studies utilization American analyses use rescue Thoracic the and a ENHANCE the on Society and at safety. we across care symptoms, May, covering ENHANCE analyses Conference XX additional medication, quality X and In abstracts from presented subgroup life, ENHANCE International exacerbations, pooled symposium data

in drugs. presented new Respiratory were ENHANCE of published the of the of symposium clinical publication, June, the evaluating results part peer-reviewed in overview as of breakthrough Medicine. the reserved ensifentrine Journal trials the for ENHANCE Critical an trial American results and COPD trial Care addition, was highlighting In In

approval. marketing These of be and mechanism medical of pending the are prepare ensifentrine, for the in to for XXXX, we ensifentrine activities potential which treatment maintenance advance FDA for over our the setting of In novel U.S. in stage half affairs our continue progress, of critical regulatory second XX-years. with efforts if launch as parallel action pre-commercial the we the potential COPD has approved, launched to first the in

the Turning to strategy. enrolled announced our treatment they China. Greater their Nuance ensifentrine our maintenance the first in in global evaluating in subject partnering development quarter, In partner of Pharma, second X COPD the trial for Phase China

rate the of successfully function ENHANCE significant brings a of success urgent exacerbation. for commercialize in in and Phase as meaningful in Nuance a such, other the reductions including We effective Pharma The met global met for key statistically and COPD. and forward to demonstrating a endpoints, submission lung these We need updates to us options. providing trial potential secondary X, and play ENHANCE ENHANCE new successfully NDA in novel improvements highly and ensifentrine our recent has Greater if COPD. trials endpoints develop ensifentrine treatment ensifentrine, China, clinically treatment exclusive risk positive look X will the The to role rights in to need X for to data the as and ensifentrine of from and paradigm our approved, population patient addressing was primary the change for program ensifentrine treatment believe the providing in and also a closer and progresses. has both

inhibitor, more approximately per-month, experienced COPD patients action therapies require of COPD availability its million as the believe we With if of patients. ensifentrine, XXX than in relief COPD. transformational worldwide, be advance symptoms XX% patients and existing and mechanism treatment novel and PDEX a third XX-days cause it Currently, their effective to suffer is leading for will more the of approved, the PDEX of treatments, to death. from provide than Despite COPD and a of new physicians selective

Looking at upcoming CHEST International at this launch Society to York, present Annual Respiratory trials finalized. the Meeting. of Also, the plan overview analysis Congress we’ll announce host Analyst and ahead, Meeting ENHANCE European we of and to once an we details later providing an plans in year, New plan the new our further

our I results will to to quarter. Mark call second over the the financial review now turn for

Mark Hahn

on of from available program currently We the with and sufficient We with ended cash pending equivalents. million morning. we credit the expect $XXX.X the including ensifentrine expected runway tax at launch current you regulatory in cash facility, XXXX, our strong, Dave, Thank the U.K. believe U.S., balance of receipts quarter the and loan through and in XXXX under funding and hand remains least good second have commercial be Oxford expected the end the planned of to sheet approval. to

loss ADS loss million or compared tax net $X.X $X.XX XXXX. after compared $X.XX for the ADS a For loss share in million tax of represents $X.XX ordinary the XX, period the net the was per a per to for after June per a XXXX. was to or quarter, of same ordinary loss ended This the per quarter $XX.X share of second for XXXX, $X.XX quarter

million XXXX million net million. of were XXXX, XX, XX, and of the compared Research of costs X-months the ended a costs June expense for $XX.X reversal ended $X.X $XX for a to of June decrease X-months development

was operation. was complete under ENHANCE expense conduct in XXXX study QX Phase the compared in R&D X dramatically lower in essentially full the QX was program XXXX, to XXXX late As when program

the In June as in This million XX, in periods. the addition, the disputed resulting of costs accrued with net certain in X-months for R&D XXXX, prior QX matter reversal negative of invoices XXXX. ended well as in favorably $X.X approximately resulted expense the supplier resolved we

an $X.X due an This $XX.X commercial Selling, general launch. the share-based as to million costs in million million. including of well prepare for in were our was to $X.X in period potential million June a ended XXXX commercial increase compared reported we people-related increase primarily build-out as and $X $X.X a related infrastructure for quarter the for same XX, administrative expenses of of increase increase compensation, million as the XXXX, costs, to

We XXXX. continue launch expense we $XX be commercial expect SG&A the we range of to aggregate, at we sales until in as In approval. of reps in the main prepare total driver quarter to for Verona for to the add $XX FDA expenses to million be Pharma million per expect expenses

to for back call the turn now operator the Q&A. the I’ll

Operator

the time, we Instructions] will now [Operator assemble roster. session. We our this question-and-answer begin to at momentarily pause will

is your line Yasmeen [Ph] Rahimi, open.

Unidentified Analyst

the on and morning congrats two Good team all questions. updates. Maybe

be the would of sort get some are list on update We to I love would one first of Chris. the on to date? just guess, priorities an The PDUFA and to-do directed now between, your what key

then And to investors the may you product not building why awareness of of goes. it recognize these critical is really implement early strategies all so lot that a the second, importance on. prep and guess for I

So now around I’ll I guess ensure what but successful? the is, is to that I’m these queue. is needed trying jump into really highly do at to Visa why two And launch work to color the the questions, back appreciate get I

Christopher Martin

how for we to need launch, access it we the really operations market on in then as about is, the of the now a do need things PDUFA. I’ll organization think and categories. systems falls marketing between there’s variety three with really start and priorities to And Yas we get Thanks build ready and across and questions. trades One into to sales. and

XPL, distribution of take majority and now systems, takes That trade time work and our third-party our I and to and it our vast spent integration of up to working to before sure organization those appropriately pathway if the to in ensifentrine the efficient look channel be between from So also at each that leaves one an manner. logistics PDUFA, and our setting can test takes a make and effective That individually is that ensure time. I patient us our launch. of market channel access get will

really that other that be is our discussions. during to payer The evolve we’ll continuing thing time doing

either benefit, but Part Medicare primarily Advantage through can know, will have ensifentrine traditional believe, is, well. medical B, Part pathway we through As as a that Medicare the also follow we come as and be to through B they reimbursed Medicare

payer Advantage focusing what in potentially around there. out and ensifentrine from plans and getting disease the could bring there engaging our been So conversations Medicare a really has those team the marketplace on and standpoint, to

Probably to gears and a the live commercially to in as that switch have that’s has a I clinical many operations warehouse. put gone now we organization from is to place. IT, already organization system we’re and actually biggest If systems there’s that transitioning focused data a an really development implementing organization,

-- out us we’re a it look really the provides through look redistribute tactics launch is capability can very effective the we because to putting what of the is at comes and spend what personal data maybe and why minute-by-minute to that manner. at on to our important the a data for when analyze This this in I quick our importance effectively our effective basis. And field so highlight the more are warehouse internal non-personal and and it all are a is reason see channels and channels less flexibility tactics

at we to ATS as as now speak. to can media data test campaigns we’re interaction to system use social get some some already the physician this that did Conference testing started start where actually We’ve and we able

mechanism will in used be marketing the third a over and decade. market the we very on about And products. the and to LABA first then new think And area LAMA, that, ensifentrine launched become has is the ICS when product really side,

market are it receptive that essential conducting the shape, that state So comes ensifentrine disease ensure drug to shaping market, to to is physicians comes disease out. the work when when

our the the XX% when the days some are the between in to What of XX feels of see the actually almost month burden patient XX some and between we that patients the experiencing feeling. look symptoms is and you COPD a of can specifically, in patients. see up how at freezer data we is these And [Ph] patient and disconnects physician research

a physicians doing there’s and and some quality their year of very work families burden of is we’ll affects be overall XXXX. work to that -- we’re with finalizing are And underestimating. the life back that the symptom we’ll members their So towards this half interact significant into of the be that ability that launching maybe

can shaping work product mentioned why activities, the think do potentially the receptivity market slow don’t in physicians’ affect those do doing product. this So we And need or new it now to when sometimes to the now. the is launch then comes biotech to implement launch. specifically pre-marketing it functions. that it ramp, or we’re And limits some between about a you doing without really PDUFA we these for that if If and critical and today I these three to work

physician the this at all uptake So then work to product smooth that transition patients ensure to essential is launch. from and

Unidentified Analyst

Chris. Great. Thank much, the queue. back you so into I’ll jump

Operator

Andreas question go from next Please, comes The Argyrides from Wedbush. ahead.

Andreas Argyrides

guys morning good my as taking Hi, the and and questions congrats thanks on for well. progress

from additional ensifentrine and Is any us at you CHEST? amount can see you what to the a ascension? in we you Thanks. product ENHANCE on where Just to to analyses from expect think And two here, combination with conjunction with provide ERS then will certain stand that start and LAMA. there updates best

Christopher Martin

second Hi, the first, to to take CHEST. good about ERS Thanks morning. it Kathy over turn then Andreas. talk Yes, and I’ll let and me so one

a to well, us in for , which think LAMA a work nebulized product, nebulized ensifentrine as continue delivery. on give We work dual extremely the space, COPD will bronchodilator plus combination as a a suited well anti-inflammatory well we

next the sense. So think a as lot as we that far of product, makes that,

be are on formulation making into of that development, stable, before in informed a can sure clinical up more stages we that we formulation that earlier course, much We launch have be later We’ll year. this and the of activities. currently stand

as our so as we’ll as that the a little are plans XXXX everyone end bit with we I we And clear articulating think in for get XXXX, of development. towards for where that, be well

ERS So comment you I for that. and Kathy, to by stand want CHEST. And would then, on

Kathleen Rickard

Sure.

I’ll So take ERS first.

XX-weeks, exacerbation continue data, rate to in have the risk, a of presentation. exacerbation’s we first So confirming a a abstract -- is the XX% -- for the is and decrease we the going that early prefers be in in that a again, of which number further time to to abstracts over XX% see decrease September, mid-part is XX-week is which ERS, the poster

basis, continue at and risk resource the presentation, but decrease oral again, looking more exhausted in an of position and visits the the have we in severe again, rate also health showing of And We utilization decrease exacerbations. to the show, and and over study. hospitalizations we’re of XX-weeks again,

demonstrating -- being abstracts we again, October, exacerbation results couple by in of And of for somewhat are that we a to X CHEST, a all the so then which have is history, format -- exacerbations shown. a show a we trials. These symptoms oral strong in consistently again these in full the side-by-side from have see trials, able history, in that exacerbation -- decrease decrease we to which X continue the and Pivotal despite symptoms short-form are

also on a from safety LAMA patients then We there’s a LAMA whether were studies, data And have they’re at both large originally full lastly, equal again, pooled or demonstrating very looking consistency showing the efficacy whether LABA efficacy our LABA. safety occurs, that or good again, of profile. on

that expect ERS the to and you’ll CHEST. So at those are see the ones

Andreas Argyrides

So you. hard for Okay. looking the on, Great. the all to back for progress? color. Thanks going Thank queue. What’s I’ll in

Operator

Andrew question comes Jefferies. from from next Please The ahead. go Tsai

Andrew Tsai

on progress. and again, questions. Hi, good morning. my Thanks for congrats taking the

on for kinds Has agency news? filing? as Maybe potential -- good like? if the has filing correspondence questions correspondent, would What’s from of there acceptance the you say the two the news one is on-going since you’ve set then the the on So no you any haven’t FDA. our wait been agency maybe been what questions submitted we side. the And

strong and in other launches big a think safety sales And Any space even maybe of with it ensifentrine, so clean then secondly, MOA You’ve that similar ensifentrine novel necessarily think space, the about any a there but situation? in relevant about got the forth. comps neuro SMID we kind within launch precedents, to type trajectory for are COPD market, and like a applies Cap efficacy, general. launch not as of think you the

would what be you. the studies investors? best Thank So case for

David Zaccardelli

take launch comps. for second take Andrew, Thanks, the the it the then first questions. to hand to I’ll and on Chris over

as As not communication FDA. the going we proper say But we’re in, you’d and that to are you a submission interactions on with is just know, comment detail. that expect, to in regulatory the in

And that I them. see And think near with August I my and etcetera. we know, on the provides is of day-XX. date, as around where that a right That now the letter business, they of day-XX our they stand think perspective, from additional of it expectation as also includes detail target end you be PDUFA deliver will well. normal course submission the will would

over would say, I turn from And Chris. normal my of So course I’ll to business it perspective. with that,

Christopher Martin

that in sales that on not we really Andrew, to COPD as comp. profile taking. another about on to launch Thanks, fits because patient and be treatment drug not there’s that ensifentrine ensifentrine armamentarium. the what In for the added is question the needs think -- the the trajectory It’s drug space, is a currently a the comp can ensifentrine, drug a replace

provides And benefit. so that it extra

got larger Pharma we’ve Yas use explained insight work against is example and very really against and an to make of part in the with at shaping, more there. things drug were do a to players successfully you you that from around in the space launch competitor competitive against that I overly it look large think up where part the learned you oral that mid-tech that efficient of able diseases have a -- launch the set we’ve very most to indication migraine And effectively. larger what we’re Pharma. the I they for are that around and if data mid-sized was broadly deployment to where But us migraine beforehand categories how an doing other biotech competing be launch market -- Biohaven competitive go and with how more back recent the of learned within your from I

at as ensifentrine. and precedent look So Verona for that a I really example

Andrew Tsai

sense, thanks. Makes

Operator

Canaccord Edward go from Nash Genuity. Please from ahead. The next question comes

Edward Nash

Thanks remind question. the you’ve needing spoken move good you to the to taking from this patients think I do Could for Hi, morning. but us, quickly point just before, ensifentrine? how of therapy first-line

therapy, applied? And is besides development I applied, future just then -- have as as being question R&D just -- another the combo far I the guess, on ensifentrine

David Zaccardelli

question. Thanks Great. for the

Let and patient on, is combination focused and on me our which then ensifentrine. over sort first, think product, to definitely we journey. the it I’ll advance take for Chris one another second Besides we’re turn of the

other We are looking as potentials. at diseases

different well, think as other possibly indications may We also dosing. require formulations different

going may some and partnering is expertise and that with of that be that helpful think on on I our strategy working devices informed to in have to different different devices. So partners be IP

of And so to some formulation. progress following the that is be and staged as going we nebulized

and other up more on the launch get we And we we of through XXXX. open clarity But as in indications XXXX ensifentrine into to think are expect I’d the have as eye And as it. COPD, an then I again, towards attentive approval well. that

general plan So our that’s R&D. on

So on patient the journey? comment you to do want Chris,

Christopher Martin

Yes. Thanks, Dave.

As we the patient based are pathways. the journey, on patients think treated two about typically

pathway treatment is have first and driver moves primary a The issues, symptoms algorithm then the of disease a really pathway where if physician they symptom-based a down there.

is we and the is What that The changes. year of from and pathway physician times the exacerbations. X X a patient market other overall our that therapy times patient typically the know between sees drive the research will symptomatology

So if changes. or breathe, will a having only make inability do what increased certain to their talks physician and about but the the is if the activity to to really therapeutic is the inability changing, physicians inability is level breathe activities it’s patient not

for ensifentrine the year. over So that, I to course into a there treatment significant journey, when at a look of be are opportunities patient’s algorithm inserted

in for until paradigm I be a triple thing is very patients. supports a or data the the don’t LAMA added situation and is a can the a or ensifentrine treatment very patient early, there LABA ensifentrine these to dual important you the LABA/ICS ensifentrine, being to wait think or have on early into inserted

to life for an their in potential the for can thing that life, normalcy some sense is of looking help improvement kind of in the are through with exacerbations products help that or patient the a as improvement FEVX of continue or great symptoms in either reduction in keep And quality physicians well.

So as in of we see journey, year, be inserted. in intervention cycle but I can the ensifentrine at cycle treatment also their late both early the points a course the look treatment multiple over patient’s treatment where

Edward Nash

very you. That’s thank helpful, Great.

Operator

comes Please Lee Truist go from next ahead. from Securities. The question Joon

Unidentified Analyst

what the for Jeremy approvability Thanks. Thanks taking Joon. for for do as you you see ones launch? Two you prepare the to for ensifentrine? is expect quick This [Ph] risk the greatest question. as my me. And What do commercial on SG&A ramp of

David Zaccardelli

chemical the the comes risk is broad to quite its submission, very the comprehensively in we CNC, across course, how process from non-clinical, When it package way entity. are and we’ve for Thanks the overall question. the We view has consistent in data feel Great. new data submission, handled inherently I and, and risks safety. the think regulatory that underlying of that all and any clinical

at spent all an be can we that think And as make to broadly, we that confident of So looking we’ve we that of time comprehensively. areas. amount enormous those were I we’re sure as addressed

Of and feedback the FDA. course, from process the regulatory during

highly to be to if we’ll course, be may any. that Of addressed, responsive items need

has handle team will through as the we so that been And times this process numerous previously.

and now, think we place early But good be. days as think I in are the I right So we’re in to we where can much as more submission, come. so for a

it Mark. turn over I’ll to that, With

Operator

the take from from go next Tom BTIG. We Please question Shrader ahead.

Thomas Shrader

Or upon is another same it B really long that get there to Chris. does drug the your for pathway? Thanks. what the for for price? exactly it Medicare And How temporary This for is the that code, the a morning. of And question. J are Chris, good take? is is then approval, drug. agreed kind an a Hi, price On steps a Or taking Part is Thanks Medicare nebulized through step? Advantage?

Christopher Martin

pathway. Yes. the process B I’ll kind start the of Medicare on with Part

if we’ve for about benefit the Medicare as So these Part think patients. that pathway, B pathway we medical a

consultants through at fall would CMS, products a with research launch, policies launched ensifentrine discussed, In for COPD that delivered coverage within we as our believe falls work nebulizer. with for So code. or -- we coverage you and policies get under under existing J our we existing temporary nebulized

J-code, during coverage that sure That are the you’re also We as updating time working J-code ensifentrine that quickly apply to as make can you’re a there. product-specific a that working product-specific be in to for J-code So nonspecific submitted now quarterly. possible. ensure under policies would

we lag X-month product-specific date, between approval using the non-specific X-month and could a on J-code. we depending between So and J-code have that a when get

here think Advantage thing when Medicare important Medicare we Part other that about has the Medicare The Advantage, pathway. to B is follow

these And Advantage so drugs they Medicare plans. have for to the coverage provide under

put patient is B, B. Advantage authorizations like Medicare criteria by needed use that place I product. are mean could Part what prior step Part in However, use have edits before a And simple Medicare traditional can use criteria Medicare unlike a or that

because most health ensifentrine data. scenario a conversations a to LAMA control the of differentiated with discussions a early really like they had, talked in from in data And they they’re presented before the side plans, the that of through is so business, being generic going about medical interested benefit to Kathy pharmacy exacerbation we’ve that care at our Advantage to with have highly that the and In or worst-case ERS major and step you’d that very makes ensifentrine. Medicare that payer some LABA potentially both standpoint see data ensifentrine the utilization that’s attractive them

with we that additional think that’s symptomatic, target It’s for to we’re needs which very if patient trying that’s of a providers about And a these ensifentrine, help. many on low the that hurdle patient therapy setting. is in

back to pricing. WAC non-specific the tied as reimbursement is J-code, far the As

more WAC it’s to ensifentrine there. set reimbursement related So a a of price pricing versus

process other when is which a days have adjudication, you product-specific takes J-code. couple your the So more J-Code a non-specific than during manual the

Thomas Shrader

Great. Okay. for the Thanks color.

Christopher Martin

Yes.

Operator

comes [Operator Wainwright. go The Instructions] from question Pachaiyappan Boobalan Please H.C. ahead. next from

Boobalan Pachaiyappan

questions. my taking for Thanks Boobalan. is this Hi,

and accepts year. FDA approved gets next assuming So your ensifentrine the NDA,

ensifentrine B thoughts primarily severe. studies ENHANCE the conducted given patients are period usage during moderate of what preliminary early with gold your in were subgroup So launch, about to

David Zaccardelli

about talk Chris, do just to want we you see where the uptake?

Christopher Martin

groups remain patients say look two we the therapies. would I’ll this symptomatic And being layer we those Yes. at we a data patients, groups LABA bucket you single therapies. on choice question. for market Boobalan, LAMA patients. to to choose one of or ensifentrine, on patient and ensifentrine is the into outstanding or of that within next see And on from that what action our the significant added see If population. for a of based mechanism that is physician thanks on patients are a current research, is that to of a data, ENHANCE logical the It these for to provides patient the our physician research uptake market in new LABA/ICS-

when The that second symptom And patients group the of burden. surgery. they’re least patients for patients office, are we are oral come dual at an we there’s to therapy and of antibiotics, physicians patients just into how tremendous those when that or dilute are know steroids, XX% they getting treating on triple potentially XX% think And that symptomatic. about potentially oral remain these having today, referred

the ensifentrine those And profile also physicians so risk physician’s of And options well. adding as we are given to ensifentrine, very patients benefit limited. see to the

decade or so. they’ve earlier anti-inflammatory this they ensifentrine for ensifentrine treatment HCPs, the moves non-steroidal provide the last in patient, think most within But will the conversations really over with likely is research and ensifentrine course what’s we of in because most their that patient the market more effect patient in, see classes immediate If about prescribe first COPD earlier paradigm latter use that potential looking and potential the the we into physicians need. our of than as that our for because been the see the the it’s could

Boobalan Pachaiyappan

much. so Thanks

Operator

there Gentlemen, more questions the no so from phone. far

David Zaccardelli

Great.

your submit for the FDA participated thank thank patients So maintenance the of drug you care in health nebulized and application enabling for COPD. and to a new for to you, questions treatment the ensifentrine program, that the professionals us today, ENHANCE to everyone,

excited updates. about of the to very are potential providing further and forward look We ensifentrine

Finally, their I’d like their concludes for at to and dedicated call. thank continued talented Operator commitment. for the team today’s Verona that our and shareholders support

Operator

Thank now for attending Ladies the and gentlemen, conference you concluded. today’s presentation. has

disconnect You may now Goodbye. lines. your

Verona Pharma (VRNA) 3 Aug 232023 Q2 Earnings call transcript