Vernalis: Tuzistra XR Steady Growth In Rx Run Rate
Edison | Jul 19, 2017 08:25AM ET
Vernalis (LON:VER) 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).
Ahead of FY17consenus
Total revenues for FY17 are expected to be higher than current market expectations. The benefit is largely due to higher than anticipated R&D milestones from its current collaborators, including the $2m milestone received from Servier (announced in April) relating to the oncology drug discovery collaboration. Operating loss for the year is expected to be lower than current consensus estimates as higher revenues and careful cost control are expected to positively affect the bottom line. Net cash at 30 June 2017 is expected to be £61m. We leave our forecasts unchanged until the FY results are announced.
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