BioWorld International Correspondent
LONDON - Vectura Group plc raised £45 million (US$83 million) in an oversubscribed placing just a month after holding back from fund raising because of sharp falls in the market.
At the same time, the company announced positive Phase IIb results for its two lead products: NVA237, for chronic obstructive pulmonary disease, and VR004, for erectile dysfunction.
Chippenham, UK-based Vectura placed 52.9 million shares at 85 pence per share, the same as the closing price a day earlier. Chris Blackwell, CEO, said the placing had a good reception because the company had delivered on the objectives set out at the time of the initial public offering in June 2004.
"We have been delighted by investor appetite in this oversubscribed fund raising, which we believe reflects our ongoing success and the strong prospects for the company," Blackwell said.
The new money will be used to create additional value by taking certain inhalation products further through development before out-licensing, taking others to filing and through broadening the pipeline.
Since its initial public offering, Vectura has completed three licensing deals, most notably with Novartis AG, of Basel, Switzerland, for NVA237, an agreement with a headline value of $375 million. That is split equally with the joint owner of NVA237, Sosei Co Ltd., of Tokyo. The Phase IIb multiple-dose-ranging trial that reported last week demonstrated efficacy, as determined by a range of pulmonary function measures. There were no severe adverse events, and the partners said the results supported the use of NVA237 as a once-daily bronchodilator in chronic obstructive pulmonary disease.
The outcome of the study supports the onward development, and Novartis is proceeding with the program.
Vectura announced results for VR004, an inhaled formulation of apomorphine for erectile dysfunction, showing improved performance with rapid onset of action. The study is the first of two double-blind, placebo-controlled trials. The second, a dose-defining study, is due to report in the first half of 2007, and the company aims to partner the product before Phase III.
Each of its collaborative partners has asked Vectura to provide expertise in inhalation as part the agreement. That validation, coupled with the value of the deals, has encouraged Vectura to raise the new money to enable it to take products further up the development path.
It proposes to spend the money on co-development opportunities, where it would seek additional rights for certain territories, or on drugs with orphan drug status, in which investment in later-stage trials is lower than for products with larger markets.
Thirty-five percent of the funds raised will go to VR315, a combination asthma therapy, which is the subject of a European collaboration. Vectura will bear the cost of co-developing the product for registration in the U.S. and other territories. The company says with the validation from the European deal, it will be an attractive partner for the U.S. market, and the ability to co-fund development will enable it to retain a higher proportion of the product's value.
A further 30 percent of the new funds will be spent on getting VR040, inhaled apomorphine hydrochloride, for treating "off episodes" experienced by Parkinson's disease patients, to the end of Phase III. The product is in a Phase IIa proof-of-concept study in 24 patients. Although apomorphine has been used in that context for more than 50 years, it has to be administered by injection.
VR040, which has European orphan drug status, is expected to be effective at lower doses, thus causing fewer side effects, and to have a more rapid onset of action than the injected formulation.
Vectura said it also will use the new money to bring in additional products.