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Theravance (TBPH) Q4 Earnings Miss, Revenues Beat Estimates

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Theravance Biopharma, Inc. (TBPH - Free Report) incurred a loss of $1.17 per share in fourth-quarter 2019, wider than the Zacks Consensus Estimate of $1.11 and also the year-ago loss of 92 cents.

However, total revenues of $29.5 million in the quarter beat the Zacks Consensus Estimate of $18 million. Revenues also soared 87.9% year over year, mainly owing to an upfront payment from Pfizer (PFE - Free Report) for rights to its skin-selective pan-JAK inhibitor program. Also, higher revenues from the collaboration agreement with Mylan benefitted the top-line.

Total revenues in the fourth quarter comprised collaboration revenues worth $9.6 million from Johnson & Johnson (JNJ - Free Report) and $9.9 million received from Mylan.

Notably, Theravance has collaboration with Mylan for the development and commercialization of Yupelri (revefenacin), approved by the FDA in November 2018. The drug is used for maintenance treatment of adults with chronic obstructive pulmonary disease (COPD). Theravance and Mylan formally launched their sales and marketing efforts for Yupelri in early 2019 and the product witnessed a strong initial sales uptake thereafter.

On the fourth-quarter conference call, management stated that Yupelri witnessed a strong customer acceptance and brand performance across key market metrics. The company also informed that as of October 2019, Yupelri achieved 86% share of the nebulized LAMA market and a 10.7% stake of the long-acting nebulized market including the DME market.

Shares of Theravance have lost 5.2% in the past year compared with the industry’s decrease of 3.8%.


Quarter in Detail

Research & development expenses were $67 million, up 28.1% from the year-ago quarter, primarily due to higher employee-related expenses and higher external cost.

Selling, general & administrative expenses escalated 29.4% to $33 million due to higher share-based compensation.

As of Dec 31, 2019, Theravance had cash, cash equivalents, marketable securities of $285.8 million compared with $352.9 million as of Sep 30, 2019.

Full-Year Results

For 2019, Theravance’s revenues of $73.4 million were up 21.5% year over year.

Loss per share was $4.25 in 2019 compared with the loss of $3.99 in 2018.

Product & Pipeline Updates

Notably, Theravance has an economic interest in royalties earned from GlaxoSmithKline on triple combination COPD treatment Trelegy Ellipta’s global sales. In the fourth quarter, Glaxo recorded sales of $221.5 million from Trelegy Ellipta. Theravance is eligible to receive 5.5-8.5% (tiered) of the product's worldwide net sales.

Theravance also has a collaboration pact with Johnson & Johnson’s subsidiary Janssen to develop its JAK inhibitor, TD-1473, for the treatment of inflammatory intestinal diseases. A phase II study on TD-1473 for treating Crohn's disease and a phase IIb/III study for ulcerative colitis are ongoing. Data from the phase IIb portion of the ulcerative colitis and phase II Crohn's disease studies is expected in late 2020.

Additionally, the company is developing TD-5202 (gut-selective irreversible JAK3 inhibitor) in a phase I study for addressing inflammatory intestinal diseases. Along with the earnings release, Theravance announced encouraging results from the phase I study on TD-5202. Data from the single-ascending dose and multiple-ascending dose studies, which evaluated the safety and tolerability of TD-5202, showed that TD-5202 was generally well tolerated in healthy patients.

Theravance is evaluating ampreloxetine (TD-9855) in two phase III programs for treating patients with symptomatic neurogenic orthostatic hypotension (nOH).

The company is developing the inhaled, lung-selective pan-Janus kinase (JAK) inhibitor, TD-8236, in a phase I study for treating inflammatory lung diseases with minimal systemic exposure. In December 2019, the company dosed the first patient in a phase II allergen challenge study on TD-8236 to address inflammatory lung diseases with data from the same expected in mid-2020.

2020 Outlook

For the full year, Theravance anticipates operating loss (excluding non-cash share-based compensation) in the range of $205-$225 million.

Theravance Biopharma, Inc. Price, Consensus and EPS Surprise


Zacks Rank

Theravance currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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