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Prices & Quotes - UK Markets - Venture Life Group (VLG)

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Share Price:
Up 48.00p
Change Today:
0.50p
Market Cap:
60.40m
Sector:
Health Care Equipment & Services

Venture Life acquires three oncology support brands

By Josh White

Date: Friday 06 Aug 2021

LONDON (ShareCast) - (Sharecast News) - Self-care products developer Venture Life has acquired a series of oncology support product assets from Helsinn Healthcare for total consideration of CHF 6m (4.7m), it announced on Friday, which was expected to be immediately earnings-enhancing.
The AIM-traded firm said the acquisition comprised three on-market products within the area of oncology support, as well as all the associated intellectual property and existing customer relationships in relation to the brands.

It said the three on-market products were Gelclair, a muco-adhesive oral rinse gel used for the management of painful symptoms of oral mucositis; Pomi-T, a polyphenol-rich mix of wholefoods used for the management of prostate specific antigen levels in prostate cancer; and Xonrid, a hyaluronic acid-based topical gel used for the prevention and treatment of radiation-induced dermatitis.

For the year ended 31 December, the brands generated gross profit of 1.3m on sales of 2.5m.

Revenues for the 2020 financial year were impacted by the Covid-19 pandemic which saw a reduction in oncology treatments due to lockdowns, however the board said it expected the revenues of the brands to benefit from the reducing effects of the pandemic and the increase of oncology treatments back to pre-Covid levels.

The brands were sold exclusively through distribution partners globally, with Venture Life noting that it already had "good" long-term relationships with some of the brand partners.

Its board said it believed there was a "sizeable" opportunity to expand the brands' geographical footprint via its existing relationships with many of the brands' current partners, as well as cross-selling within its current business.

The directors also considered that there was a further opportunity to develop additional new products for the nascent oncology support category within the company.

Venture Life has been the contract manufacturer of Gelclair since 2000, and of Xonrid since 2018 and, as such, the board said it expected the integration of the brands to be relatively straightforward.

Additionally, the acquisition came with the support of a transitional services agreement for up to 21 months for the regulatory aspects required during the transition from the Medical Device Directive to the new Medical Device Regulations in the European Union.

The total consideration paid was CHF 6m, of which CHF 3m was payable on completion and an unconditional CHF 3m would be due 12 months post-completion.

Venture Life said the consideration would be funded from a combination of cash reserves and the revolving credit facility it announced on 21 June.

Remaining cash reserves plus subsequent cash generation, along with the remaining available facility, would give "considerable firepower" to continue the company's brand acquisition strategy, the board added.

"I am delighted to announce another acquisition in pursuit of our progressive strategy to develop the group through selective acquisitions of exciting and immediately earnings enhancing assets," said chief executive officer Jerry Randall.

"Oncology support has been an area of interest in recent years for Venture Life as a potential growth area in an under-served market.

"Oncology patients and their healthcare practitioners look for products that provide effective relief from the painful side effects of oncology treatments.

Randall said the brands were "well-established", backed by "good" clinical data, and already had meaningful revenues in a number of countries.

"We believe we can broaden the portfolio and offering, leveraging our in-house capabilities and expertise in medical devices and our geographic reach.

"Gelclair is partnered in 40 countries already and we have existing relationships with some of its partners.

"There is the opportunity to further expand its geographic footprint and recently a new Japanese partner has achieved registration and is expected to launch the product in 2021."

Pomi-T is less widely distributed, Jerry Randall said, in 22 countries, as it was only launched in 2017, but again the company believed there was a "good opportunity" to expand the product further geographically.

"The addition of the brands to the group brings meaningful additional revenue and profitability for the future."

At 1422 BST, shares in Venture Life Group were up 1.39% at 89.22p.

Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.

 

VLG Market Data

Currency UK Pounds
Price 48.00p
Change Today 0.50p
52 Week High 103.00p
52 Week Low 42.50p
Volume 14,922
Shares Issued 125.83m
Market Cap 60.40m
Beta 0.24

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What The Brokers Say

Strong Buy 1
Buy 0
Neutral 0
Sell 0
Strong Sell 0
Total 1
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VLG Dividends

  Latest Previous
  Final Interim
Ex-Div 24-May-18 n/a
Paid 22-Jun-18 n/a
Amount 0.040p 0.000p

Trades for 30-Nov-2021

Time Volume / Share Price
15:25 7,022 @ 46.04p
11:00 900 @ 48.70p
09:22 2 @ 48.00p
09:22 250 @ 48.00p
09:22 30 @ 46.00p

VLG Key Personnel

CEO Jerry Randall
CFO Andrew Waters