Vision and strategy
Our vision is to build Vernalis into a diversified, self-sustaining pharmaceutical company. Our strategy to achieve this vision takes the best of what the Company already has and supplements it through in-licensing and acquisition. We are following a three-tier strategy to achieve these goals.
A focused and disciplined three-tier strategy to deliver growth and create value for shareholders.
- Develop and commercialise late-stage assets with low development-risk in the US
- Realise value from NCE pipeline
- Continue balanced investment in research
This component of the strategy has the potential to create significant shareholder value and involves developing up to six cough cold products with Tris and in-licensing or acquiring further late-stage low-risk drug candidates.
We aim to realise value for our shareholders by developing such drug candidates, obtaining their approval and marketing them through our commercial infrastructure. This will provide a cash generative and profitable commercial component to our business.
Our principal late-stage low development-risk activity is focused on the development and licensing agreement with Tris to develop up to six extended-release liquid formulations of short-acting prescription cough cold products. There are substantial technological barriers to the development and manufacture of extended-release liquid formulations and this combined with the significant size of the US prescription cough cold market offers the potential to build a profitable and cash generative pharmaceutical component to the Company’s business. The most advanced product, Tuzistra® XR was approved by the FDA for use in the US prescription cough cold market on 30 April 2015 and was launched through our newly established US commercial infrastructure at the beginning of September 2015. Development continues on four further products at Tris and we hope to make two further NDA filings in 2016. We plan to expand our US commercial operations as further products are approved or if we add to our commercial programmes through in‑licensing or acquisition.
We will continue to look for further in-licensing opportunities to augment this component of the strategy but importantly these opportunities will be late-stage and low-risk.
The goal is to partner all of our NCE drug candidates. This will enable us to realise value for our shareholders through future receipts from collaborations which may be significant if the drug candidates progress to market and achieve commercial success.
Some of our development stage drug candidates are already partnered and their future development is being undertaken entirely at the cost and risk of the partner. We are entitled under these existing collaborations to receive payments upon the partner achieving specific milestones and royalties and have a history of receiving both.
Since our last annual report, we have completed our investment in V81444 and V158866. Following completion of a Phase II POC study for V81444, we successfully partnered this programme in April 2015. Our investment in V158866 has just been completed and we do not intend to make further investments in this programme. We do not plan to initiate any further in-house NCE development at this time.
Including V158866 and luminespib (AUY922) (the rights to which are being returned to us by Novartis), we have three in-house programmes that are not yet partnered and for which we are seeking partners based on existing clinical data.
This component of Vernalis’ business model is built upon a core expertise in fragment- and structure-based drug design, with a record of having successfully discovered small molecule drug candidates against novel drug targets. This capability is demonstrated by our portfolio of leading collaboration partners including Asahi Kasei Pharma, Lundbeck, Servier and Taisho.
The potential value created from this component of our business is lower than from both of the other components as the majority of the risk remains with our partners. The return that we expect to earn is also spread over a significantly longer period, reflecting the time during which the partner progresses successful drug candidates through development and commercialisation.