Circassia and Verona cough up some good news

Investors in both Circassia and Verona Pharma have not had the easiest of rides, but today both groups managed to provide investors with some solace with significant share price rises following positive data for their COPD products.

Shares in Circassia rose by 12%, while Verona saw its battered stock jump 27%. With positive data under their belts the next, and most challenging, step for both groups will be executing on the promise of their molecules.

Two molecules are better than one

Phase III data from the Amplify study compared Circassia’s LABA/LAMA combination Duaklir against its individual components – aclidinium bromide and formoterol – as monotherapies. At the end of the 24-week study, which was conducted by partner Astrazeneca, Duaklir showed statistically improved lung function.

Circassia in-licensed US-rights to Duaklir from Astrazeneca in March, paying $50m up front in equity as part of a larger respiratory deal, which also gave it the COPD LAMA product Tudorza.

Thankfully for Circassia, positive data for Duaklir will provided some justification for the group’s decision to transform itself into a respiratory player following the failure of its lead cat allergy product last year (Allergy failure lets the cat out of Circassia's M&A bag, June 20, 2016).

Making it work

Astrazeneca, which still retains ex-US rights, will now file the drug with the FDA in the first half of 2018. If successful, Circassia will have the job of overseeing the marketing of Duaklir in the US. Analysts at Stiefel are predicting a possible launch in the first half of 2019.

But despite today’s clinical success and treatment guidelines emphasising the use of LABA/LAMA combinations it is still hard to believe that Circassia will be able to do a better job than a multi-national company at commercialising Duaklir in the US, a market where it has limited experience.

There is also the not so insignificant matter of intense competition in the COPD space, which has so far led to less than stellar sales for Duaklir, which is already marketed in Europe. The product only manage to chalk up sales of $63m last year and combined sales for Astrazeneca and Circassia are only forecast to hit $220m in 2022, according EvaluatePharma.

Alternative approach

However, the COPD space is large and has suffered from lack of innovation, something that Verona, which now has positive phase IIb data for RPL554, will be banking on. Instead of the usual LABA/LAMA combinations in the space, which often rely on generic products, RPL554 is a dual inhibitor of PDE3 and PDE4.

Given this alternative mechanism of action and Verona’s focus on sicker patients, management at the UK company are hoping RPL554 might be able to carve out a niche for itself (Interview – Verona investors still holding their breath, July, 26, 2017).

Data from a small 30 patient study showed that when used in combination with Spiriva, RPL554 significantly improved lung function.

So far, so good…but

However, Verona also has bigger issues that could cast a pall over its positive data.

The painfully slow progress the group has made with RPL554 mean that by the time it has completed the remainder of clinical trials needed for approval, possibly 2022, RPL554’s main composition of matter patent will have expired.

While Verona believes the rest of its patent estate will hold up until 2023 the uncertainty around the foundation of its exclusivity have until now acted as a drag on the shares. As such, Verona needs to move as quickly and flawlessly as possible to get RPL554 to market, otherwise today’s share price hike might be a false dawn.

Company Product Trial ID
Circassia Duaklir NCT01437397
Verona RPL554 NCT03028142 

To contact the writer of this story email Lisa Urquhart in London at or follow @ByLisaU on Twitter

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