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Verona Pharma Plc (VRNA)
NASDAQ:VRNA
Top Page
Verona Pharma
(NASDAQ:VRNA)
56Neutral
Positive Factors
Market Uptake
Filled Ohtuvayre prescriptions increased significantly each month in late 2024, indicating strong market uptake and potential for robust long-term growth.
Product Growth
Ohtuvayre's unique bronchodilator and anti-inflammatory mechanism will drive robust growth.
Revenue
Ohtuvayre's net revenue during 4Q24 was approximately three times higher than the initial estimate.
Negative Factors
Future Pricing Cuts
There is an anticipation of a 25% price cut in 2033 due to the Inflation Reduction Act and a 40% price cut in 2036 due to patent expiration.
Pricing Pressure
A 25% cut in pricing is modeled in 2033 due to the Inflation Reduction Act, and a 40% price cut in 2036 due to patent expiration.
Verona Pharma (VRNA) vs. S&P 500 (SPY)
Market Cap
$5.25B
Dividend YieldN/A
Average Volume (3M)1.31M
Price to Earnings (P/E)―
Beta (1Y)1.65
Revenue GrowthN/A
EPS Growth-213.94%
CountryUS
Employees209
SectorHealthcare
Sector Strength64
IndustryBiotechnology
Share Statistics
EPS (TTM)-2.16
Shares Outstanding79,110,640
10 Day Avg. Volume1,335,079
30 Day Avg. Volume1,305,829
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)134.29
Price to Cash Flow (P/CF)-49.20
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$80.25Price Target Upside26.76% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering9
Verona Pharma Business Overview & Revenue Model
Company DescriptionVerona Pharma plc, a clinical stage biopharmaceutical company, focuses on development and commercialization of therapies for the treatment of respiratory diseases with unmet medical needs. The company's product candidate is ensifentrine, an inhaled and dual inhibitor of the phosphodiesterase (PDE) 3 and PDE4 enzymes that acts as both a bronchodilator and an anti-inflammatory agent in a single compound, which is in Phase 3 clinical trials for the treatment of chronic obstructive pulmonary disease, asthma, and cystic fibrosis. It is developing ensifentrine in three formulations, including nebulizer, dry powder inhaler, and pressurized metered-dose inhaler. Verona Pharma plc was incorporated in 2005 and is headquartered in London, the United Kingdom.
How the Company Makes MoneyVerona Pharma makes money through the development and potential commercialization of its proprietary drug candidates, primarily focusing on ensifentrine. The company's revenue model is centered around advancing its drug candidates through clinical trials, securing regulatory approvals, and ultimately marketing the approved therapies to healthcare providers and patients. Revenue streams may include sales of approved drugs, milestone payments from strategic partnerships, and potential royalties on licensed products. Additionally, Verona Pharma may engage in collaborations with larger pharmaceutical companies to leverage their resources for co-development and commercialization, which can provide upfront payments and funding support for clinical trials.
Verona Pharma Financial Statement Overview
Summary
Verona Pharma shows promising revenue growth, primarily from the launch of O2VARE, but remains challenged by profitability issues, with persistent net losses and negative cash flow impacting the financial health. While strong equity positions help, continuous reliance on external financing is a concern.Income Statement
Verona Pharma has shown a substantial revenue increase in 2024 compared to previous years, but the company continues to operate at a net loss, with negative net income and EBIT margins. The gross profit margin is positive, but high operating losses are a concern.40
Negative
Balance Sheet
The balance sheet reflects a relatively strong equity position with a low debt-to-equity ratio. However, ongoing losses and high liabilities relative to assets suggest financial pressure. Equity ratio remains healthy, indicating some stability.55
Neutral
Cash Flow
Cash flow from operations is negative, indicating ongoing cash burn. Free cash flow is negative, though financing activities have provided some liquidity. The cash position is strong, but reliance on external financing could be a risk.45
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 42.28M | 0.00 | 458.00K | 40.00M | 0.00 | Gross Profit |
| 39.70M | -679.62K | 112.00K | 40.00M | -627.85K | EBIT |
| -154.63M | -67.83M | -66.12M | -73.31M | -74.28M | EBITDA |
| -138.53M | -52.47M | -67.29M | -42.19M | -47.81M | Net Income Common Stockholders |
| -173.42M | -54.37M | -68.70M | -55.57M | -65.15M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 399.76M | 271.77M | 227.83M | 148.38M | 187.99M | Total Assets |
| 474.24M | 308.12M | 259.47M | 186.59M | 204.21M | Total Debt |
| 2.36M | 51.33M | 10.65M | 5.81M | 5.95M | Net Debt |
| -397.40M | -220.44M | -217.18M | -142.57M | -182.04M | Total Liabilities |
| 269.68M | 58.84M | 29.00M | 38.58M | 19.35M | Stockholders Equity |
| 204.56M | 249.28M | 230.47M | 148.00M | 184.85M |
| Cash Flow | Free Cash Flow | |||
| -122.20M | -50.22M | -59.89M | -33.27M | -45.16M | Operating Cash Flow |
| -122.20M | -50.22M | -59.86M | -33.25M | -45.08M | Investing Cash Flow |
| -580.00K | 0.00 | -29.00K | -12.00K | 9.71M | Financing Cash Flow |
| 250.78M | 92.87M | 140.82M | -6.12M | 192.34M |
Verona Pharma Technical Analysis
Positive
63.31
Price Trends
62.62
Positive
55.19
Positive
42.16
Positive
Market Momentum
-0.46
Negative
56.94
Neutral
90.61
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VRNA, the sentiment is Positive. The current price of 63.31 is above the 20-day moving average (MA) of 59.13, above the 50-day MA of 62.62, and above the 200-day MA of 42.16, indicating a bullish trend. The MACD of -0.46 indicates Negative momentum. The RSI at 56.94 is Neutral, neither overbought nor oversold. The STOCH value of 90.61 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VRNA.
Verona Pharma Risk Analysis
Verona Pharma disclosed 72 risk factors in its most recent earnings report. Verona Pharma reported the most risks in the “Tech & Innovation” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Verona Pharma Peers Comparison
Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $4.47B | 12.44 | 27.90% | ― | -6.36% | 4.57% | |
70 Outperform | $4.88B | 55.49 | 10.34% | ― | 473.02% | 1620.44% | |
56 Neutral | $5.25B | ― | -76.51% | ― | ― | -213.94% | |
52 Neutral | $5.41B | ― | -4584.47% | ― | 31.04% | 16.91% | |
51 Neutral | $5.20B | 3.26 | -40.34% | 2.93% | 17.68% | 1.94% | |
40 Underperform | $4.51B | ― | 435.49% | ― | 145.34% | 3.20% | |
35 Underperform | $5.11B | ― | -29.46% | ― | ― | -81.09% |
* Healthcare Sector Average
Performance Comparison
VRNA
Verona Pharma
63.31
48.07
315.42%
ALKS
Alkermes
27.15
2.50
10.14%
CYTK
Cytokinetics
38.00
-28.82
-43.13%
KRYS
Krystal Biotech
165.80
6.75
4.24%
GH
Guardant Health
45.64
27.54
152.15%
NUVL
Nuvalent
72.71
5.51
8.20%
Verona Pharma Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: -0.33% | Next Earnings Date: Apr 29, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive sentiment overall, driven by the successful launch and strong initial sales of O2VARE, significant prescriber adoption, and strategic global expansion efforts. However, increased costs and losses and some challenges with reimbursement are noted as areas of concern.Highlights
Successful Launch of O2VARE
In the first full quarter of commercial availability, net sales of O2VARE were $36.6 million in Q4 and $42.3 million for the full year 2024. The launch momentum is strong with more prescriptions dispensed in the first two months of Q1 2025 than in Q4 2024.
Positive Prescriber Adoption
Over 4,600 unique HCPs are prescribing O2VARE, including 55% of 2,500 tier one HCPs. Over 275 HCPs have prescribed O2VARE to more than 20 patients in their practice.
Global Expansion and Regulatory Advances
Nuance Pharma announced the approval of O2VARE in Macau and completed enrollment in its pivotal Phase 3 clinical trial in China. Preparations are underway for potential marketing authorization applications in the EU and UK.
Strong Financial Position
Verona Pharma ended 2024 with $400 million in cash and equivalents, with access to up to $425 million of additional capital through the Oak Creek facility.
Pipeline Progress
Completed Phase 2 clinical trial with glycopyrrolate ALAMA and plans to initiate a Phase 2b trial evaluating a fixed-dose combination of ensifentrine with glycopyrrolate in the second half of 2025.
Lowlights
Increased Costs and Losses
Research and development costs increased to $7.9 million in Q4 2024 from $4.1 million in Q4 2023. Selling, general, and administrative expenses rose to $45.1 million for Q4 2024 from $15 million in Q4 2023. Net loss after tax was $33.8 million in Q4 2024 compared to $14.1 million in Q4 2023.
Reimbursement Challenges
Some discrepancies in prescription reimbursement rates for pulmonologists, with rates ranging widely. Emphasis on patient out-of-pocket costs and the need for supplemental insurance for those on Medicare.
Company Guidance
In the Verona Pharma call discussing their fourth quarter and full year 2024 financial results, significant progress was highlighted, particularly with the launch of O2VARE for COPD treatment. Key metrics included $36.6 million in net sales for Q4 and $42.3 million for the entire year. The launch saw strong uptake, with over 4,600 unique healthcare providers prescribing O2VARE, including 55% of their tier one providers. They observed growth in new patient starts and refills, indicating a positive reception. Financially, they reported a net loss of $33.8 million for Q4, with a $400 million cash reserve, and access to an additional $425 million. The company continues to expand globally, with O2VARE approved in Macau and ongoing regulatory and marketing authorization efforts in the EU and UK. Additionally, Verona Pharma is progressing with two Phase 2 clinical programs, further emphasizing their commitment to advancing COPD treatments.Verona Pharma Corporate Events
Private Placements and FinancingBusiness Operations and Strategy
Verona Pharma Enhances Financial Flexibility with Loan Amendments
Positive
Mar 28, 2025
On March 27, 2025, Verona Pharma announced an amendment to its credit agreement with Oaktree, increasing the Tranche C Term Loans from $75 million to $125 million and reducing the interest rate from 11% to 9.7%, with a further reduction to 9.35% upon meeting sales milestones. The amendment also includes a $75 million basket for a future working capital facility. On March 28, 2025, Verona Pharma repurchased its $100 million RIPSA obligation with reduced fees and increased its term loan facility to $450 million with improved terms. This strategic move enhances Verona Pharma’s financial flexibility and supports the continued growth of its COPD treatment, Ohtuvayre, while maintaining access to an additional $200 million under the term loan facility.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.