- Vernalis Delivers on Significant Clinical Milestones and Establishes Commercial Operation - WINNERSH, England, Sept. 12 /PRNewswire-FirstCall/ -- Vernalis plc (LSE:VERLSE:Nasdaq:LSE:VNLS) today announced its interim results for the six months ended 30 June 2006. Highlights -- U.S. commercial business fully operational detailing Apokyn(R) and Frova(R) -- Strong financial position with closing cash of 50.9 million pounds sterling -- Losses reduced at 19.4 million pounds (2005: 20 million pounds) -- Frova(R) supplemental New Drug Application (sNDA) submitted to US FDA for the prevention of menstrual migraine (MM) -- V1003 (partial opioid agonist) meets primary end point in Phase IIa study for the management of post-operative pain -- Significant progress towards initiation of four further clinical trials in H2 2006 -- V1512 (methylester of levadopa) Phase III study in Parkinson's disease -- V2006 (A(2A) antagonist) Phase II study in Parkinson's disease -- V24343 (CB(1) antagonist) Phase I study in obesity -- Hsp90 (Hsp90 inhibitor) Phase I study in cancer -- Entered into an agreement with Pfizer to sub-lease approximately half of premises at Granta Park, Cambridge Simon Sturge, chief executive officer of Vernalis, commented: "Vernalis is continuing to show substantial progress toward becoming a self-funding, sustainable R&D driven commercial business. Establishing our U.S. operation with the successful launch of Apokyn(R) and completing the Frova(R) clinical trials for the short-term prevention of menstrual migraine were significant achievements. The second half of 2006 is expected to have substantial news flow as we progress our drug candidates through the clinic and boost our product revenues." U.S. Commercial Operation Fully Operational During the first six months of 2006 Vernalis' North American commercial business became fully operational and is now marketing the Company's Parkinson's disease drug, Apokyn(R) (apomorphine hydrochloride injection), as well as co-promoting its migraine drug, Frova(R) (frovatriptan succinate) 2.5 mg tablets alongside its partner, Endo Pharmaceuticals (Endo). Apokyn(R) Vernalis' U.S. commercial operation has established its credibility through a significant increase in new prescriptions for Apokyn(R) following its re-launch in January 2006. However, gross sales for the first six months of 2006 of $2.3 million are somewhat below initial expectations because of lower levels of repeat business due to an under-reporting of patients who had discontinued their treatment during the period prior to acquisition by Vernalis. The lower sales in H1 2006 mean that, while we still believe gross sales for the full year will be within the guidance initially provided of $6 million - $7.5 million, we would now expect them to be at the lower end of this range. Net sales for the period, after provisions, were $1.8 million. The substantial growth in new business, along with the new marketing initiatives including the Nurse Support Programme (The APOKYN(R) Circle of Care(TM)) and the introduction of product sampling, gives us considerable confidence in the potential of Apokyn(R). Frova(R) In May 2006 Vernalis completed the final Phase III pivotal efficacy study in MM patients who had failed on acute therapy, aimed at obtaining approval for Frova(R) for use as an intermittent, short-term preventative treatment for MM. This study achieved its primary end point and, together with the Phase III efficacy and safety studies previously conducted, resulted in the submission of the sNDA to the FDA. If the sNDA is successful, Vernalis expects FDA approval in mid-2007. Development Portfolio Update Pain Franchise -- V1003 (partial opioid agonist) - Achieved the primary endpoint in a Phase IIa study in acute post-operative pain. Vernalis is now working with its partner, Reckitt Benckiser, to identify the most appropriate development programme for nasal delivery of buprenorphine. -- V3381 (dual NMDA antagonist/MAO-A inhibitor) - In August 2006, Vernalis started a Phase IIa trial in patients with neuropathic pain resulting from long-standing diabetes. Neurology Franchise -- V1512 (methylester of levadopa) - This potential treatment for Parkinson's disease has completed Phase II studies with a Phase III study expected to begin in H2 2006. -- V10153 (thrombolytic) - Phase IIa trial in acute ischaemic stroke is on-going with the aim to determine whether V10153 can be clinically effective in patients up to 9 hours after the occurrence of a stroke. The trial is targeted to complete patient enrolment in H2 2006. -- V2006 (A(2A) antagonist) - A series of Phase I trials has been completed. Vernalis' partner, Biogen Idec, is now responsible for moving forward into Phase II trials which are expected to start in H2 2006. Other Programmes -- V24343 (CB(1) antagonist) - This potent and selective cannabinoid receptor antagonist is a potential treatment for obesity and related disorders. Vernalis expects to start Phase I testing in overweight and mildly obese volunteers in H2 2006. -- Hsp90 (Hsp90 inhibitor) - Vernalis' partner, Novartis, has selected a clinical development candidate in this oncology programme. Phase I testing is expected to start in H2 2006. -- MMPI-12 (metalloenzyme inhibitor) - Vernalis' partner, Serono, has completed a Phase I study of this matrix metalloprotease inhibitor looking at its therapeutic potential in inflammatory disorders including multiple sclerosis. Financial Position Revenues increased to 6.6 million pounds in the first six months of 2006 from 5.9 million pounds in the same period of 2005. In addition, Vernalis reduced its loss before taxes to 19.4 million pounds during the first half of 2006 as compared to 20.0 million pounds in the same period of 2005. Following a successful fund raising completed at the end of 2005, Vernalis' cash resources at the end of June 2006 totalled 50.9 million pounds. Simon Sturge and Tony Weir, CEO and CFO of Vernalis respectively, will today host an analyst / investor presentation and conference call at 9:00 am BST to discuss the interim results. This may be accessed by dialling: +44(0) 1452 541076, and quoting 'Vernalis conference call.' A replay facility will be available for 7 days by dialling: +44(0) 1452 550000, with the access code: 5493221# Enquiries: Brunswick Group Jon Coles Justine McIlroy +44 (0)20 7404 5959 About Vernalis Vernalis is a speciality bio-pharmaceutical company focused on products marketed to specialist neurologists. The company has two marketed products, Frova(R) and Apokyn(R), and a development pipeline focused on neurology and central nervous system disorders. The company has seven products in clinical development and development collaborations with leading, global pharmaceutical companies including Novartis, Biogen Idec and Serono: Product Indication Phase Phase Phase Registration Market Marketing I II III Rights Apokyn(R) Parkinson's x North Disease America Frova(R) Migraine x US milestones & royalties - Endo(EU - royalties) Frova(R) Menstrual x US Migraine milestones Prevention & royalties - Endo(EU - royalties) V1512 Parkinson's x World Wide Disease (excl. Italy) V10153 Ischaemic x World Wide stroke V1003 Acute Pain x US Profit share Option Reckitt Benckiser V3381 Neuropathic x World Wide Pain V2006 Parkinson's x US Disease Co-promotion Biogen Idec MMPI Multiple x None - Sclerosis royalty (Serono) Vernalis has established a U.S. commercial operation to promote Apokyn(R) and co-promote Frova(R) alongside its North American licensing partner, Endo Pharmaceuticals, progressing the company towards its goal of becoming a sustainable, self-funding, R&D-driven, speciality bio-pharmaceutical company. For further information about Vernalis, please visit http://www.vernalis.com/. Vernalis Forward-Looking Statement This news release may contain forward-looking statements that reflect the Company's current expectations regarding future events including the clinical development and regulatory clearance of the Company's products, the Company's ability to find partners for the development and commercialisation of its products, as well as the Company's future capital raising activities. Forward- looking statements involve risks and uncertainties. Actual events could differ materially from those projected herein and depend on a number of factors including the success of the Company's research strategies, the applicability of the discoveries made therein, the successful and timely completion of clinical studies, the uncertainties related to the regulatory process, the ability of the Company to identify and agree beneficial terms with suitable partners for the commercialisation and/or development of its products, as well as the achievement of expected synergies from such transactions, the acceptance of Frova(R) and Apokyn(R) and other products by consumers and medical professionals, the successful integration of completed mergers and acquisitions and achievement of expected synergies from such transactions, and the ability of the Company to identify and consummate suitable strategic and business combination transactions. 1. Strategy and operational review Vernalis' strategic goal is to become a sustainable, self-funding, R&D driven speciality bio-pharmaceutical company primarily focused on drugs for the treatment of neurology and CNS disorders. The Company has two marketed products, a pipeline of seven clinical drug candidate programmes as well as a strong research capability that expects to add two clinical programmes to its portfolio in H2 2006. Vernalis has established a commercial operation in North America to market Apokyn(R) and co-promote Frova(R) alongside its partner Endo, as well as to promote other products that it is developing in- house or may acquire. Marketed Products Apokyn(R) - Advanced Parkinson's Disease Apokyn(R) is the only acute, intermittent therapy available in the U.S. for the treatment of immobilising "off" episodes associated with advanced Parkinson's disease. It is administered, as needed, by means of an injector pen to treat periods of immobility in people with advanced disease. In April 2004, Apokyn(R) received FDA approval with Orphan Drug designation to treat advanced Parkinson's disease patients in the U.S. who experience the severe "on/off" motor fluctuations that are unresponsive to other oral Parkinson's disease therapies. Approximately 112,000 patients with Parkinson's disease experience such "off" episodes despite optimal oral PD therapy. Apokyn(R) was launched in the U.S. in July 2004 and Vernalis acquired the North American commercial rights from Mylan in November 2005. Mylan stopped promoting Apokyn(R) in July 2005. When Vernalis re-launched this promotion-sensitive product in February 2006, new prescriptions had diminished to almost zero. Apokyn(R) is sensitive to promotion due to patients' requirement for close medical supervision during the initial administration in order ensure that each individual patient is individually titrated to their optimal dose and to minimise the risk of first dose side effects. During the first half of 2006, Vernalis established several marketing initiatives as part of its Apokyn(R) re-launch strategy. Vernalis has worked closely with physicians to communicate the benefits of Apokyn(R) and reduce the barriers that prevent patients from starting to use the product. These efforts include a nurse support programme (The APOKYN(R) Circle of Care(TM)) where nurses assist physicians with the initial titration and may also visit patients in their home to ensure that they are comfortable using the drug and gaining the maximum benefit. In addition, Vernalis has introduced a sampling programme making it easier for the physician to initiate a patient and help ensure the patient will benefit from the drug prior to having incurred any expense. Vernalis expects these types of activities to begin to impact levels of new prescriptions approximately three months after introduction. As a result, prescriptions initially remained at the low levels inherited from Mylan during the early part of the year, but have begun to increase substantially in recent months. Gross sales in H1 2006 were $2.3 million and are expected to be at the lower end of the initial guidance of $6 million to $7.5 million for the full year. Apokyn(R) is indicated for the acute, intermittent treatment of hypomobility or "off" episodes associated with advanced Parkinson's disease. It is used as an adjunct to other PD medications. Apokyn(R) is associated with severe nausea and vomiting and should be given with a concomitant antiemetic (trimethobenzamide). Frova(R) - Acute Migraine Frova(R) is a selective 5-HT(1B/1D) receptor agonist approved as an acute oral treatment for migraine headache and its associated symptoms. Frova(R) is a triptan and is distinguished from other triptans by its long half-life. Vernalis has licensed North American rights for Frova(R) to Endo who reported net sales of the product of $20 million for H1 2006. Vernalis has co-promoted Frova(R) in the U.S. with Endo since February 2006. In Europe, frovatriptan is marketed in twelve countries by Menarini. The drug was approved throughout the then 15 member states of the European Union via the mutual recognition procedure in January 2002. In the first half of 2006 Menarini launched frovatriptan in Slovakia (January 2006), Finland (March 2006), Czech Republic (June 2006) and Slovenia (June 2006). In Germany and Italy market share has grown to approximately 10 per cent and in excess of 12 per cent, respectively, of the overall triptan market. Frova(R) is approved for the treatment of migraines in adults. The most common adverse events include dizziness, fatigue, paresthesia, flushing, and headache. Development Portfolio Pain Franchise Frova(R) - Prevention of Menstrual Migraine Vernalis has completed a series of studies aimed at obtaining approval for Frova(R) for the intermittent, short-term prevention of MM and Vernalis' partner, Endo filed an sNDA with the FDA in July 2006. Vernalis expects an approximate 10-month review for the sNDA with a potential approval in mid- 2007. If approved by the FDA for this new indication, Vernalis will receive a $40 million milestone payment from Endo. The Frova(R) sNDA is supported by data from four clinical studies, the final of which, a second efficacy study, reported in May 2006. Patients in the study had previously failed on other acute therapies and were treated for three peri-menstrual periods (PMPs). The primary endpoint was the number of menstrual migraine-free PMPs. Both once and twice-daily dose regimens of Frova(R) demonstrated efficacy, with statistical significance compared to placebo (p