LONDON (Alliance News) - Verona Pharma PLC on Tuesday said its loss narrowed by two thirds in the third quarter of 2018 on increased finance income and reduced costs as it initiated a phase two trial of its candidate drug.
The pharmaceutical company posted a pretax loss of GBP3.5 million for the three months to September, a fraction of its GBP10.4 million loss the prior year.
Total finance income for the period was GBP3.3 million, well ahead of its GBP114,000 finance income the prior year. The bulk of this increase in finance income was attributed to a GBP2.6 million fair value adjustment on derivative financial instruments, where none was recorded the prior year.
Furthermore, Verona cut its research & development expenditure to GBP5.3 million from GBP6.1 million and its general & administrative costs to GBP1.4 million from GBP2.0 million.
In the nine months to September 30, however, pretax loss widened to GBP19.9 million from GBP17.1 million as finance expense increased to GBP3.5 million from GBP2.2 million and finance income fell to GBP1.8 million from GBP4.1 million.
This came despite a narrowing in the year-to-date operating loss, which combines both research & development and general & administrative expenses, to GBP18.3 million from GBP19.1 million.
Verona's product candidate is RPL554, which is both a bronchodilator and an anti-inflammatory agent.
A phase two clinical trial of RPL554 was initiated during the third quarter of the year, which evaluated its potential as an add-on treatment for chronic obstructive pulmonary disease.
Post period end, enrolment was completed in this phase two clinical trial and top line data is expected in January. Shore Capital highlighted that topline data was previously forecast for the first quarter of 2019, placing the new prediction ahead of schedule.
Moreover, Verona also published full results from two phase two clinical studies looking at RPL554 in COPD. The studies found that RPL554 had a meaningful add-on effect when used with single bronchodilators.
Verona is strongly focused on bringing RPL554 into third phase trials as a maintenance treatment for COPD, it said. This, Verona said, requires it to deploy "financial and other resources on maintenance treatment of COPD" in the short term. This is anticipated to alter the timing of future trials assessing RPL554 as a potential cystic fibrosis and asthma treatment.
Commenting on Verona's results, Shore Capital Markets expects the phase three trial will begin in late 2019 or early 2020 and anticipates either a licencing deal for RPL554 or further financing ahead of phase three.
Verona itself has said that strategic collaborations may be used in the development and commercialisation of the drug.
The pharma company also considering acquiring or in-licencing candidates for respiratory disease treatments.
"We plan to leverage our respiratory disease expertise to identify and in-license or acquire additional clinical stage product candidates that we believe have the potential to become novel treatments for respiratory diseases with significant unmet medical needs," said Verona.
Shares in Verona were up 1.3% at 119.00 pence on Tuesday.