SKYEPHARMA PLC - INTERIM MANAGEMENT STATEMENT
LONDON, UK, 16 May 2012 - Ahead of its Annual General Meeting later today, SkyePharma PLC (LSE: SKP) publishes its Interim Management Statement for the period 1 January 2012 to 15 May 2012, providing an update on key matters since the Company issued its preliminary results statement on 22 March 2012.
Pipeline and product updates
flutiform® - Europe
As announced on 20 April 2012, the Committee for Medicinal Products for Human Use ("CHMP") of the European Medicines Agency ("EMA") issued a positive opinion recommending the granting of a marketing authorisation for flutiform® (fluticasone propionate/formoterol fumarate). The positive opinion adopted by the CHMP will go through the standing committee procedure which, in the absence of any further issues, will be converted into a legally binding decision by the European Commission, a process which typically takes 2 to 3 months.
In a number of countries negotiations will also be required with national pricing and reimbursement authorities before the product can be made commercially available. In other countries it is anticipated that the national marketing approvals would be granted shortly after the decision is issued (such approvals can typically take between 1 and 3 months). The manufacturing processes for flutiform® have been successfully validated and preparations are sufficiently advanced to enable launch in initial markets in Europe later this year.
flutiform® - Japan
Good progress continues to be made with two Phase III clinical trials of flutiform® in Japan. The target remains to file the Japanese New Drug Application during Kyorin's fiscal year ending March 2013 and, subject to receiving approval, launch during Kyorin's fiscal year ending March 2015.
flutiform® - Mexico, Central and South America
Preparations for filing marketing authorisation applications in Mexico and Central and South America are ongoing. The applications will be based on data included in the European MAA that received a positive opinion from the CHMP.
On 20 April 2012, the Group received a milestone payment of U.S.$10 million (£6.2 million) from Pacira Pharmaceuticals, Inc, ("Pacira") following the launch of EXPAREL® in the United States. Under the terms of the sale of the Group's former Injectable Business, now Pacira, the Group is also entitled to receive further contingent milestone payments of up to an aggregate of U.S.$52 million (£32.5 million) and 3% of net sales of EXPAREL® in the United States and, if approved and launched in those markets in Japan, United Kingdom, France, Germany, Italy and Spain.
As previously disclosed, during 2011 the Group's respiratory development team provided contract development services for RespiVert Ltd ("RespiVert"), a small molecule drug discovery company acquired by Janssen Biotech, Inc. in 2010, focused on developing improved treatments for patients with severe respiratory diseases. Following this, the Group has entered into a similar agreement for a feasibility study to develop a dry powder inhaler (DPI) dosage form for another RespiVert compound. The work is aimed at developing new therapeutic options for patients living with severe, chronic respiratory diseases including chronic obstructive pulmonary disease (COPD) and severe asthma.
Reorganisation of Swiss Operations
As announced on 10 January 2012, the Group entered into agreements with the Aenova Group to sub-let some laboratory space and sell surplus laboratory equipment to Aenova. The reorganisation led to a reduction of approximately 21 of the 101-strong workforce in Muttenz, Switzerland, of which 11 oral formulation and oral analytical development technical staff were recruited, by agreement, by Aenova. This has reduced the Group's fixed cost base whilst retaining the capability to offer innovative oral drug delivery solutions using the same technical staff on a sub-contract basis for development work.
Trading to date has continued to be in line with the Board's expectations, with no significant changes in the outlook for 2012 since the preliminary announcement. With the positive opinion on flutiform® adopted by the CHMP the Board anticipates milestone revenues totalling €8 million (£6.7 million) when flutiform® is approved and launched in initial markets in Europe.
The Group started 2012 with £15.2 million of cash and, as anticipated, received the U.S.$10 million (£6.2 million) milestone payment when Pacira achieved its first commercial sale of EXPAREL® in the United States in April 2012. When flutiform® is approved and launched in initial markets in Europe, liquidity will also benefit from the receipt of €8 million (£6.7 million) of initial launch milestones, subject to 50% being applied as prepayments of the Paul Capital Note. The Group continues to work with Jefferies International Limited, which is advising on the Group's capital structure, and, as anticipated, SkyePharma (Jersey) Ltd has commenced a dialogue with certain holders of convertible bonds to seek a consensual solution to rebalance the Group's financing obligations to be in line with forecasted cash generation. Further information on the convertible bonds and the Group's cash flows and resources is as set out in Note 2 of the 2011 Annual Report and Accounts.
Peter Grant, Chief Executive Officer of SkyePharma, commented:
"Whilst trading continues to be in line with our expectations, the Group's prospects have been improved following the positive opinion on flutiform in Europe and the launch of EXPAREL in the U.S., triggering a milestone payment to SkyePharma of $10 million (£6.2 million). The progress of flutiform in Europe and Japan, combined with the second contract win with RespiVert, are strong endorsements of SkyePharma's capabilities in developing innovative and complex respiratory products."
Note on Accounting Treatment of EXPAREL® milestone:
Due to the nature of the milestone, as contingent proceeds related to the disposal of the Injectable Business by the Group to Pacira, the U.S.$10 million launch milestone has been treated as exceptional income arising from discontinued operations in the financial accounts of the Group. It is currently envisaged that future receipts of the share of net sales will be treated as other income in the revenue line.
For further information please contact:
Peter Grant, Chief Executive Officer
+44 207 881 0524
Jonathan Birt/ Julia Phillips/ Susan Quigley
+44 207 831 3113
About SkyePharma PLC
Using its multiple drug delivery technologies, SkyePharma strives to deliver clinical benefits for patients by developing new formulations of known molecules to create enhanced versions of pharmaceutical products. The Group has eleven approved products in the areas of oral and topical delivery as well as important license and revenue-generating arrangements in inhalation and injectable technologies. The Group's products are marketed throughout the world by leading pharmaceutical companies. For more information, visit www.skyepharma.com.