Veru Inc ((VERU)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Veru Inc’s recent earnings call presented a mixed sentiment, with positive clinical trial results and a promising regulatory pathway for its drug Inovasarm, counterbalanced by financial challenges and cash flow concerns. Despite these financial hurdles, the company’s advancements in drug development indicate a hopeful outlook.
Successful Phase 2b Clinical Trial Results
The Phase 2b clinical trial for Inovasarm yielded impressive results, showing a 42% greater relative loss of fat mass compared to the placebo group. Additionally, the trial demonstrated a statistically significant preservation of total lean mass and a reduction in the proportion of patients experiencing a decline in physical function.
Positive Safety Profile
Inovasarm’s Phase 2b trial revealed a positive safety profile, with no significant adverse events such as gastrointestinal side effects or liver injury. This safety profile was maintained even after the discontinuation of semaglutide, underscoring the drug’s potential for safe long-term use.
Novel Modified Release Formulation
Veru Inc has developed a new modified release oral formulation of Inovasarm, which demonstrates a distinct target product release profile. This formulation is protected by extended patent protection through 2037, offering a competitive edge in the market.
Optimistic Regulatory Pathway
The company has scheduled a meeting with the FDA to gain regulatory clarity on the Phase 3 program. Previous feedback from the FDA supports the clinical path forward, indicating a potentially smooth regulatory process.
Reduction in Operating Expenses
Veru Inc reported a decrease in research and development costs from $4.8 million to $3 million, alongside a reduction in selling, general, and administrative expenses from $5.8 million to $5 million. These reductions reflect the company’s efforts to manage its financial resources more effectively.
Financial Loss
The company reported a net loss of $7.3 million for continuing operations and a net loss of $17 million for the nine months ended June 30, 2025. These figures highlight the financial challenges Veru Inc is currently facing.
Cash Flow Concerns
With a cash balance of $15 million, Veru Inc faces significant cash flow concerns, as this amount is insufficient to fund operations for the next twelve months. The company will need to secure additional capital to sustain its operations.
Reverse Stock Split
A one-for-ten reverse stock split was executed, potentially reflecting concerns about the company’s stock price and market perception. This move may be aimed at improving the stock’s marketability and investor appeal.
Forward-Looking Guidance
Veru Inc provided guidance focusing on their clinical-stage drug candidates, particularly the Phase 2b study outcomes for Inovasarm. The study showed a 100% preservation of lean mass in patients over 60 years old using Inovasarm with semaglutide. Additionally, the company is developing a novel modified release formulation for Phase III clinical studies, with promising pharmacokinetic profiles and patent protection through 2037. The company is seeking FDA regulatory clarity for its Phase III program, targeting an older population at risk for muscle weakness and falls.
In conclusion, Veru Inc’s earnings call highlighted the company’s significant clinical advancements and a promising regulatory pathway for Inovasarm. However, financial challenges and cash flow concerns remain pressing issues. The company’s efforts to manage expenses and secure regulatory approvals are critical steps towards achieving a positive future outlook.