Verona Pharma PLC Q1 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Andrew Tsai - Jefferies - Analyst : Hey, good morning. Congrats on another great quarter. Thanks for taking my questions. I have two this morning. So first is, as we exit Q1 and enter Q2, can you talk about the trends that you're seeing? Can you share any color or characterize how healthy these metrics are looking in April so far and how might they look in May and June? Thanks.

Question: Andrew Tsai - Jefferies - Analyst : Right, and then as it relates to my second part, which is a bigger picture, one, my understanding saw some seasonality, the typical industry phenomenon. Which based on my understanding, affected the pace of uptake, not necessarily gross to net, and so that should not play out going forward this year and I think refills will continue on as well. So I guess the second part of my question is, do you think sales could inflect even faster in Q2, Q3, Q4? Just trying to envision or gauge how you're envisioning the sales curve to look, whether it's more parabolic or linear from here. Thank you.

Question: Andrew Tsai - Jefferies - Analyst : Great, thank you again and congrats.

Question: Yasmeen Rahimi - Piper Sandler - Analyst : Good morning team and congrats for an outstanding quarter, I guess kind of like going along with Andrew's questions that he started off as within that theme, I think, I mean it's pretty remarkable. You've doubled from 4Q to 1Q. There's a big TAM. This is a really safe and effective drug, I guess just to be like, why couldn't you continue seeing such a rapid growth? Like, guess what I'm trying to figure out is what is the difference between 2Q and 1Q and now we know one had the seasonality aspect. Like, I guess what I'm trying to figure out is before you put up this number the consensus. I think the run rate for this year was around $300 million to $350 million, that was the range, but now with this $71 million on hand, you would basically project this to be substantially higher. So, if you could just kind of help us understand sort of with this really remarkable one what the run rate could look like that would be really helpful. And then if you could comment on what the growth to net is now and how it will change going into the year, that would be helpful, and I'll jump back into the queue.

Question: Yasmeen Rahimi - Piper Sandler - Analyst : Thank you. Congrats again.

Question: Olivia Brayer - Cantor Fitzgerald - Analyst : Hi, good morning. Congrats on the quarter and thank you guys for the questions. Maybe just following up on Growth Tonet quickly. It's obviously trending much better than that 25%. Discount that you guys have previously talked about. So maybe just any thoughts on where you think that could ultimately shake out. And then on hitting operating cash flow positive this quarter, is that something you think you can maintain going forward and just any thoughts on the kind of earnings power that you could start to have, especially as we think about 2026 and beyond. Thank you guys.

Question: Olivia Brayer - Cantor Fitzgerald - Analyst : Great, thanks guys. Congrats on the great quarters.

Question: Tara Bancroft - TD Cowen - Analyst : Hi, good morning. Thanks for taking the questions and congrats on the fantastic quarter. So, I was hoping if you could provide any more color on the refill rate for patients who initiated Ohtuvayre treatment six or more months ago. Like, what are the rate of refills per year also that you're expecting at steady state? Basically any color you could provide on how you expect this to evolve would be really helpful. Thanks.

Question: Tara Bancroft - TD Cowen - Analyst : Okay, great. Yes, thank you so much. And just briefly, separately, just, do you have the option or the interest to repurchase China rights and any kind of description of the size of the China market would be really helpful too. Thanks.

Question: Tara Bancroft - TD Cowen - Analyst : Okay, thank you so much.

Question: Tiago Fauth - Wells Fargo - Analyst : Great, let me add my congrats and thanks for taking the questions. Just on the persistent question, when we do our channel checks, the discontinuation rate seems to be very low, so it's fairly anecdotal, but I'm curious if you have any insights from the field in terms of if there are discontinuations, what might be driving that that doesn't feel like it's safety tolerability or anything like that. It feels a little bit more random, at least when we do those channel checks so, any color there would be helpful. And my second question is more related to long term competition of biologics. I've been getting a lot of inbounds on how that could potentially impact the opportunity here, especially if you have more upstream mechanisms of action. I'm curious how you guys are seeing the long term play here. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 29, 2025 / 1:00PM, VRNA.OQ - Q1 2025 Verona Pharma PLC Earnings Call Thank you.

Question: Tiago Fauth - Wells Fargo - Analyst : Fair enough. Alright, thank you so much.

Question: Thomas Shrader - BTIG - Analyst : Good morning and congratulations for essentially hitting Our 2Q Number. I have a I'm doing some reading on a bronchiectasis, and as far as I understand it. A fair number of COPD patients also have that diagnosis. Do you know how you do well in those patients or were they excluded? And then a real quick one for either Mark or Chris. Are you guys completely outside of the Medicare Part D redesign or is that something that you also have to think about? Thanks.

Question: Thomas Shrader - BTIG - Analyst : Just to follow up, what is the overlap? Is it very small?

Question: Thomas Shrader - BTIG - Analyst : Go ahead, Kathy. Go.

Question: Thomas Shrader - BTIG - Analyst : Okay. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 29, 2025 / 1:00PM, VRNA.OQ - Q1 2025 Verona Pharma PLC Earnings Call

Question: Thomas Shrader - BTIG - Analyst : Great, thank you.

Question: Raghuram Selvaraju - H.C. Wainwright - Analyst : Thanks very much for taking my questions and congrats again on this excellent quarter, really impressive performance. I was wondering if you could maybe give us some more information and insight on the competitive landscape and what you are hearing from physicians as we approach potential readouts from biologics that are kind of in the same vein as talizumab, in particular drugs like Ipecac or --. And in particular you know this kind of follows on from one of I think the earlier questions about competition from biologics. If there are any physician opinions indicating that prescribers might look at the lower frequency of administration for biologics as a potential advantage or reason to put patients on a biologic versus ensifentrine. And if you are not seeing evidence of that, maybe give us a sense of why and in particular if this might be traced back to not only ensifentrine's unique mechanism of action but also the safety advantages that it would likely continue to enjoy over any future biologic competitors. Thank you.

Question: Raghuram Selvaraju - H.C. Wainwright - Analyst : That's very helpful. Just one other quick one you mentioned earlier in the call about the possibility of turning attention towards in licensing or acquiring additional potential products or product opportunities. Can you elaborate on that a little bit just from a broad strategic perspective and if you are looking specifically, I would imagine at pulmonology focused products and how broadly you expect to cast your net and if you are going to specifically only concentrate on those opportunities that are likely to be directly complementary to. Thank you.

Question: Raghuram Selvaraju - H.C. Wainwright - Analyst : Thank you very much.

Question: Joon Lee - Truist Securities - Analyst : Good morning and congrats on the really strong quarter. This is awesome on for Zoom. Thanks for taking the questions. Just a couple from us. So, for the tier one doctors who haven't yet prescribed Ohtuvayre, what are you hearing from them? And then on the patent update, you had several patents that were potentially eligible for an orange book listing. Can you remind us which one was granted for June 2044? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 29, 2025 / 1:00PM, VRNA.OQ - Q1 2025 Verona Pharma PLC Earnings Call

Question: Sushila Hernandez - Van Lanschot Kempen - Analyst : Yes, thank you for taking my question and congrats on a quarter. I share continue to progress the regulatory activities for potential marketing authorization applications submissions in the EU and UK. Could you share your latest thinking on strategy and partnering in these regions? Thank you.

Question: Sushila Hernandez - Van Lanschot Kempen - Analyst : Okay, that's clear. Thank you.

Question: Boobalan Pachaiyappan - Roth Capital - Analyst : Hi, good morning and congrats on the progress. So I have a couple of questions. So firstly, with respect to price stability, so with all the news about tariffs on inflation taking the center stage, so I wonder if price stability will be maintained for in 2025. Any thoughts on that? That's the first question. And then second, with respect to your face to be fixed or study, I was wondering if you could provide some high-level thoughts. What to expect in the study that you're planning to start the second half of this year. And then in that regard, I wonder if you are planning to measure pre pre-dose FEV1 because my understanding is that this is one of the important efficacy markers that FDA is looking for, even though the 0 hour to 12 hours FEV1 is also a good one. Thank you.

Question: Andrew Tsai - Jefferies - Analyst : All right, thank you very much.