Veru is not the easiest pharma company to summarize. On the surface, Veru is a clinical-stage oncology company with its chief candidates aimed at managing two of the most prevalent cancers — breast and prostate.
Meanwhile, Veru has also thrown a COVID-19 drug into the ring that’s in phase 3 trials and being evaluated for the treatment of hospitalized patients at high risk for acute respiratory distress syndrome (ARDS).
But it’s an entirely different arm of the business — its sexual health division called Urev — that has given the company its financial wings in recent years thanks to sales from its lead product and the company’s telemedicine portal.
While this might sound a bit disconnected, Mitch Steiner, the company’s CEO, says it’s all by design.
“There’s a method to the madness,” Steiner says. “None of this was by accident.”
According to Steiner, the plan is simple. Rather than only supporting its oncology pipeline development through fundraising, the company is leaning on revenue from already approved products. As Steiner puts it: It’s about generating multi-millions in sales while going after multibillion-dollar markets.
The approach is paying off.
In late 2021, Veru was included in Deloitte’s Technology Fast 500 ranking, which pinpoints North American companies experiencing rapid growth in tech, media, life sciences, telecommunications and more. To make it on the list, revenue growth is tracked for three years. For Veru, that growth — between 2017 and 2020 — was 212%.
The company’s sales have also kept Veru out of the proverbial “valley of death” — the dreaded place where biotechs fall when they run out of funds while still working on getting a product approved.
“Most biotech companies raise money and raise money and dilute the value to shareholders,” he says. “That seemed like a broken model.”
While the company moves closer to reaching its blockbuster goals in cancer, leveraging its sexual health division — and in particular, its platform for direct-to-patient platform for sales — is what could help the company get there.
In the pipes
Currently, Veru has two drugs — Enobosarm and Sabizabulin — that are in late-stage trials as standalone treatments or in combination with other drugs for four different indications in breast cancer.
Enobosarm, which Steiner calls a novel approach, works by targeting the androgen receptor (AR) that has long been known to prevent breast cancer growth. Yet, many AR-targeting therapies from past studies have failed to gain traction because they caused masculinizing effects such as deep voices and facial hair. Enobosarm, however, bypasses these side effects by having agonist and antagonist activities, depending on the type of tissue.
“We do think that we have an incredibly transformative therapy,” Steiner says. “We’re going after a hormone receptor, the androgen receptor, that’s sitting there — completely under-exploited.”
The company’s pipeline for prostate cancer includes two other treatments along with Sabizabulin, which the company calls an “oral, first-in class small molecule that targets, binds to, and crosslinks the alpha and beta tubulin subunits of microtubules of cells resulting in disruption of the cytoskeleton.”
Because Sabizabulin has antiviral and anti-inflammatory effects, Veru is trialing the drug for COVID-19 patients at a high risk for ARDS, one of the complications of the illness linked to high mortality rates. After a phase 2 study showed that it had the ability to reduce deaths by 82%, the treatment is now in late-stage studies.
To support these clinical programs, Veru — formerly called Aspen Park Pharmaceuticals — has turned to sexual health and the burgeoning demand for telemedicine.
Connecting with patients
“Last year we turned a profit, even in the face of all of this clinical activity, and we did it because of our sexual health division,” Steiner says.
When Veru formed in 2016, Steiner says that the company’s female condom — FC2 — was generating about $13.7 million in sales. Since then, prescriptions for the product have soared. Last year, the entire division, which also includes a product for premature ejaculation and a recently approved treatment for benign prostatic hyperplasia, reached $61.3 million in revenue.
A large part of what has allowed this growth is the company’s direct-to-patient telemedicine portal that connects users with prescribers and sets up patients to request prescriptions online or by mail.
In general, “virtual care” has boomed during the pandemic. In 2020, a survey of 1,000 patients conducted by Kryuus, a patient solutions provider, found that nearly three-quarters of respondents had their first virtual visit with a doctor during COVID-19, and over 75% of them were very or completely satisfied with the approach.
“This isn’t the future. It’s here,” Steiner says. “Telemedicine companies are springing up all over the place.”
Not only does telemedicine provide a solution to patients who’d prefer to stay out of a doctor’s office, it could also help pharma companies that have had to ground sales forces due to the pandemic.
“If you’re a pharma company and you’re still thinking that you’re going to be able to drive market demand the old-fashioned way, through foot traffic…I think it’s going to be a big mistake,” Steiner argues.
Although the telemedicine approach is a good fit for sexual health products like FC2 — which requires a prescription, but not necessarily an in-person exam — Steiner says that telemedicine could evolve into a solution for managing a number of diseases.
“I would say that it’s going to be the most disruptive for any disease that requires chronic care,” Steiner says. “If you have diabetes, for example, you may need to see a doctor initially, but then it can be managed by having a telemedicine portal.”
Going forward, Steiner says that Veru plans to develop its own direct-to-patient telemedicine and pharmacy services portal — in addition to using other outside companies’ platforms — to continue driving sales for FC2.
Steiner says that it’s one more deliberate step in the company’s overall plan to stay nimble and diversified while fueling its growth.
“We were told that this was too complicated of a business plan. People have said that you should just focus on one thing. But we look at it a different way. We represent the shareholder, and the shareholder doesn’t want to have all of their risk in one product,” Steiner says. “And if we can do that…and eventually do a lot of good by treating patients with cancer and prolonging their quality of life, then that’s pretty cool.”