With revenue falling precipitously and high hopes for its COVID drug sabizabulin dashed by a thumbs-down from the FDA, Veru needs funding to continue developing its pipeline.
A significant chunk came on Thursday as Veru sold its approved drug for enlarged prostate, Entadfi, to Blue Water Vaccines. The deal is for $20 million upfront plus an additional $80 million if sales milestones are met.
Entadfi, which won approval from the FDA in December 2021, is for men with benign prostatic hyperplasia (BPH), which is a noncancerous enlargement of the prostate. The condition is common in elderly males, often affecting urination flow and causing erectile dysfunction (ED).
Entadfi is a combination of Merck’s Proscar (finasteride), which was approved 20 years ago to treat BPH, and Eli Lilly’s Cialis (tadalafil), which was endorsed 15 years ago by the FDA to treat ED.
With Veru struggling with the launch of Entadfi, the Wisconsin-based company is turning it over to Blue Water, which enters a new era with the acquisition.
“We’re now a commercial-stage pharmaceutical company, with an opportunity to generate revenues in the near term,” Blue Water CEO Joseph Hernandez said during a Thursday conference call.
With the purchase, the Cincinnati-based company will change its name to Blue Water Biotech. The rebranding will go into effect later this quarter.
Since it was established five years ago, Blue Water has developed vaccines as it holds the rights to proprietary technology developed at the University of Oxford, Cincinnati Children’s Hospital Medical Center, St. Jude Children’s Hospital and the University of Texas Health Science Center at San Antonio.
Blue Water plans to bolster sales of Entadfi by educating healthcare providers on the value of the drug and by attempting to convince insurance providers to cover it.
BPH occurs in half of men over age 50 and 90% of men over age 85. In 2022, 44 million prescriptions were written for the condition, according to IQVIA, with 20 million of them new. Blue Water said it will target new patients with Entadfi.
As for Veru, the 52-year-old company was dealt a blow in November when an FDA advisory committee voted 8 to 5 to recommend rejection of sabizabulin for COVID patients. The FDA rejected the drug in March. Despite the defeat, Veru is continuing with its plan for another trial of its COVID pill.
The company also has treatments in development for breast and prostate cancers. Its only other FDA-approved product was its aging FC2 Female Condom, which prevents pregnancy and infectious disease.
Veru’s revenue fell from $61.3 million in its fiscal year of 2021 to $39.4 million last year, while its R&D spend increased from $32.7 million in 2021 to $70.6 million last year. In the first quarter of this year, revenue fell to just $2.5 million.