Norwegian drugmaker Vistin Pharma turns to metformin, sales in Q2 13% lower

Norwegian pharmaceutical company Vistin Pharma ASA said it had strong demand and stable prices for its metformin products in the second quarter of 2017. Upon completion of the recently announced sale of its opioids and contract manufacturing business (CMO), Vistin Pharma will become a pure play metformin company with considerable growth ambitions and a solid financial platform to support its strategy.

Vistin Pharma’s CEO Kjell-Erik Nordby, said that the sale of its opioids and CMO business will allow the company to focus on strengthening its position as one of the world’s largest producers of premium metformin, the gold standard treatment of type 2 diabetes.

Metformin is the standard 1st line treatment of Type 2 Diabetes

Diabetes is one of the largest global health emergencies of the 21st century, and from a commercial perspective, Vistin Pharma is attractively positioned to take its significant share of what is an ever-growing market, Nordby noted.

Vistin Pharma estimates its global market share of the metformin market to approximately 8%. The company said it was investing in a doubling of its current production capacity, and expects the new production line to be fully operational during 2019.

A Sales and Purchase agreement for Visting’s opioids and CMO business has been made with Australian company TPI Enterprises Ltd, and closing of the transaction is expected early in the fourth quarter.

Vistin Pharma had total revenues and other income from continuing operations of NOK 54.1 million (€5,8M) in the second quarter 2017, compared to NOK 54.6 million (€5.88M) in the second quarter 2016. Total revenues and other income for the quarter included a net gain of NOK 8.8 million (€0.95M) relating to an insurance settlement received in connection with the reactor failure at its metformin factory in the fourth quarter 2016.

Sales volumes in the quarter were 13% lower compared to all-time high volumes in the corresponding quarter 2016. The company says it is currently producing at full capacity. Vistin Pharma’s decision to invest in a new production line at its metformin plant in Kragerø, Norway, will effectively double the current production capacity upon completion in 2019. The project is running according to plan, and is currently in the detailed engineering phase.

Visting Pharma pointed out its financial position remains strong, with a cash position of NOK 59.7 million (€6.43M) as of June 30. Total equity was NOK 179.0 million (€19.29M), giving an equity ratio of 66.4% (73.1%).