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Vectura expects sales and earnings “at least” in line with expectations

The pharma company said cash in the bank will be £74mln, 32% lower than last year’s £108mln, while there will be an extra US$200mln awarded by a US jury in patent litigation against GSK

Vectura Group PLC - Vectura expects revenue, earnings “at least” in line with expectations

Vectura Group PLC (LON:VEC) said revenue and underlying earnings (EBITDA) for calendar 2019 will be at least in line with expectations.

The pharma company said cash in the bank will be £74mln, 32% lower than last year’s £108mln, while there will be an extra US$200mln awarded by a US jury in patent litigation against GlaxoSmithKline PLC (LON:GSK).

READ: Hikma and Vectura make new application for GSK knock-off

However, GSK has appealed the case in the US and a decision is expected before the end of the first quarter in 2021.

Vectura said it will focus its efforts on the US case and thus will not pursue an appeal against the previous UK high court decision that found against Vectura.

For 2020, Vectura has factored in “mid-single digit millions” of exceptional cash costs as it transitions towards a development services model, while research & development investment will be between £40mln and £45mln, versus £55.5mln in 2018.

The new year is also expected to see US approval of VR315, an asthma drug candidate developed with Hikma Pharmaceuticals Plc (LON:HIK), bringing in milestone payments of US$11mln plus a mid-teen royalty on net sales.

Similarly, the approval in Europe of asthma inhaler candidate QVM149, developed with Novartis, would mean a US$5mln milestone payment plus a low-single digit royalty on net revenues.

“This trading update is very largely in-line with our current forecasts and so we do not expect to change our numbers materially,” analysts at Peel Hunt said in a note.

Quick facts: Vectura Group PLC

Price: 91.3 GBX

AIM:VEC
Market: AIM
Market Cap: £551.72 m
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