Financial Highlights • Total revenue: Total revenue for the fourth quarter 2025 was $114.6 million, representing 25% growth compared to total revenue of $91.8 million for the fourth quarter 2024. Total revenue for the full year 2025 was $411.3 million, reflecting 15% growth compared to total revenue of $358.7 million for the full year 2024. Exhibit 99.1 Innoviva Reports Fourth Quarter and Full Year 2025 Financial Results; Highlights Recent Company Progress Durable royalties portfolio generated $58.4 million ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K | (Mark One) | | | --- | --- | | ☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | | | For the fiscal year ended December 31, 2025 | | | or | | ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | | | For the transition period from to | | | Commission File No. 000-30319 | | | INNOVIVA, INC. | | | (Exact name of registrant as specified in its cha ...

Core Viewpoint - Innoviva, Inc. (NASDAQ:INVA) is highlighted as a promising small-cap stock with significant upside potential following the FDA approval of its antibiotic NUZOLVENCE® [1][2]. Group 1: FDA Approval and Product Details - The FDA approved NUZOLVENCE® (zoliflodacin) on December 12, which is a first-in-class, single-dose, oral antibiotic for treating uncomplicated urogenital gonorrhea in adults and pediatric patients aged 12 and older weighing at least 35 kg [2][4]. - The approval was based on results from a Phase 3 clinical trial, the largest ever conducted for a new treatment against Neisseria gonorrhoeae infection in high-prevalence regions across five countries [4]. Group 2: Market and Investment Insights - H.C. Wainwright updated Innoviva's price target to $46 from $45 while maintaining a Buy rating on the stock, indicating positive market sentiment following the FDA approval [1][2]. - Despite the potential of Innoviva as an investment, there are suggestions that certain AI stocks may offer greater upside potential with less downside risk [5].

Core Viewpoint - The FDA has approved NUZOLVENCE® (zoliflodacin), a first-in-class oral medication for treating uncomplicated urogenital gonorrhea in adults and pediatric patients aged 12 and older weighing at least 35 kg [1] Company Summary - Innoviva Specialty Therapeutics, a subsidiary of Innoviva, Inc., is responsible for the development and announcement of NUZOLVENCE [1] - The development of NUZOLVENCE was part of a private, not-for-profit collaboration [1] Industry Summary - The approval of NUZOLVENCE represents a significant advancement in the treatment options available for uncomplicated urogenital gonorrhea [1]

Core Viewpoint - The U.S. Food and Drug Administration has approved Innoviva's oral antibiotic for treating a common sexually transmitted infection, providing a pill alternative to the currently available injection treatment [1] Company Summary - Innoviva has developed an oral antibiotic that has received FDA approval, marking a significant advancement in the treatment options for sexually transmitted infections [1] Industry Summary - The approval of an oral antibiotic by the FDA represents a shift in the treatment landscape for sexually transmitted infections, potentially increasing patient compliance and accessibility compared to injection-based therapies [1]

Core Viewpoint - Innoviva Specialty Therapeutics, Inc. announced positive results from a pivotal Phase 3 trial for zoliflodacin, an investigational single-dose oral antibiotic for treating uncomplicated urogenital gonorrhea, published in The Lancet [1] Group 1 - The trial was sponsored and led by the Global Antibiotic Research & Development Partnership (GARDP), a not-for-profit partner of the company [1]

Summary of Innoviva's Conference Call Company Overview - **Company**: Innoviva - **Key Executives**: Pavel Raifeld (CEO), Austin Hackett (VP and Director of Business Development) [1][2] Business Segments - Innoviva operates in three main areas: 1. **Royalty-focused respiratory assets**: Generates approximately $250 million in annual revenue, providing consistent cash flow and downside protection [2][3] 2. **Innoviva Specialty Therapeutics (IST)**: A commercial-stage business with over $100 million in annual revenue, experiencing rapid growth [3][9] 3. **Strategic healthcare assets**: Valued at around $500 million, with potential for disruptive value creation [3] Royalty Business - Innoviva receives royalties from two key products: - **Breo Ellipta**: 15% royalty on global sales - **Anoro Ellipta**: 6.5% royalty on sales - Combined royalties have been approximately $250 million annually, supported by a strong patent estate providing exclusivity into the early 2030s [5][6][26] Innoviva Specialty Therapeutics (IST) - **Giapreza**: Largest revenue contributor, critical care product for septic shock, showing over 50% year-over-year growth due to refreshed commercial strategy and new data generation [10][11][22] - **Xacduro**: Addressing unmet needs for resistant Acinetobacter infections, performing strongly in its launch phase [11][12] - **Xerava**: Mature product with long-term growth potential due to resistance issues [12] - **Zevtera**: Newly launched product for Staph aureus bacteremia, addressing a significant unmet need with approximately 120,000 cases annually in the U.S. [19][20] Market Dynamics - The hospital anti-infective market has seen challenges, but Innoviva views this as an opportunity due to the exit of big pharma and the presence of differentiated assets [13][14] - Access to hospital formulary committees is crucial, but Innoviva has not faced major hurdles with its differentiated products [18] Future Growth and Strategy - Innoviva is open to acquiring additional assets but prioritizes organic growth from its existing portfolio [32] - The company is exploring adjacencies within the hospital setting, including critical care and anti-infectives, and is particularly interested in antifungal products due to unmet needs [34][37] Strategic Investments - **Lyndra**: A long-acting oral drug delivery platform acquired at an attractive price, with potential applications across various therapeutic areas [38][39] - **Armata**: A bacterial phage platform with promising data in treating bacterial infections, with Innoviva as a major shareholder [43][44] Financial Position - Innoviva has approximately $500 million in cash, providing flexibility for acquisitions, strategic investments, or returning capital to shareholders [46] Conclusion - Innoviva's diversified business model, strong revenue streams, and strategic investments position it well for future growth in a volatile market environment [2][3][46]

Group 1: Earnings Performance - Innoviva reported quarterly earnings of $1.08 per share, significantly exceeding the Zacks Consensus Estimate of $0.46 per share, representing an earnings surprise of +134.78% [1] - The company posted revenues of $107.8 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 14.78% and showing an increase from $89.51 million year-over-year [2] Group 2: Market Performance and Outlook - Innoviva shares have increased by approximately 4.6% since the beginning of the year, while the S&P 500 has gained 15.1%, indicating underperformance relative to the broader market [3] - The current consensus EPS estimate for the upcoming quarter is $0.50 on revenues of $100.32 million, and for the current fiscal year, it is $1.19 on revenues of $383.09 million [7] Group 3: Industry Context - The Large Cap Pharmaceuticals industry, to which Innoviva belongs, is currently ranked in the bottom 42% of over 250 Zacks industries, suggesting potential challenges in outperforming the market [8]

Financial Performance - Third quarter 2025 gross royalty revenue from GSK was $63.4 million, a 4.8% increase from $60.5 million in the third quarter 2024[202]. - Third quarter 2025 net product sales totaled $47.3 million, representing a 70% increase compared to $27.8 million in the third quarter 2024[202]. - Third quarter 2025 net income was $89.9 million, or $1.30 basic per share, compared to a net income of $1.2 million, or $0.02 basic per share, for the third quarter 2024[202]. - Total net royalty revenue increased to $59.9 million for the three months ended September 30, 2025, a 5% increase from $57.1 million in the prior year[209]. - Total product sales, net, rose to $47.3 million for the three months ended September 30, 2025, reflecting a 70% increase from $27.8 million in the same period last year[210]. - Gross royalty revenues from GSK for the nine months ended September 30, 2025, totaled $192.0 million, with net product sales of $113.1 million and license revenue of $2.1 million[224]. - Net cash provided by operating activities for the nine months ended September 30, 2025, was $142.4 million, an increase of $12.97 million (10%) from $129.5 million in 2024[226]. - Net cash provided by investing activities for the nine months ended September 30, 2025, was $16.9 million, a change of $65.2 million from $(48.3 million) in 2024[229]. - Net cash provided by financing activities for the nine months ended September 30, 2025, was $12.3 million, compared to a cash outflow of $(14.0 million) in 2024[231]. Product Sales Breakdown - U.S. net product sales included $18.2 million from GIAPREZA®, $8.5 million from XACDURO®, and $3.2 million from XERAVA®, marking a 52% increase in total U.S. net product sales compared to $19.7 million in the third quarter 2024[202]. - U.S. product sales for GIAPREZA increased by 39% to $18.2 million for the three months ended September 30, 2025, compared to $13.1 million in 2024[210]. - The increase in XACDURO ex-U.S. product sales was primarily due to the Amended Zai Agreement, which is billed at cost[211]. Expenses and Costs - Research and development expenses surged to $13.7 million for the three months ended September 30, 2025, a 285% increase from $3.6 million in the prior year[216]. - Selling, general and administrative expenses were $27.3 million for the three months ended September 30, 2025, a 4% increase from $26.2 million in 2024[217]. - Cost of products sold increased by 157% to $25.6 million for the three months ended September 30, 2025, compared to $10.0 million in the same period last year[213]. Investments and Acquisitions - Innoviva invested $15.0 million in a term loan to Armata, which announced positive Phase 2 data in Staphylococcus aureus bacteremia[203]. - Innoviva acquired a proprietary long-acting oral drug delivery platform from Lyndra Therapeutics for an upfront payment of $10.2 million[203]. - Innoviva's portfolio of strategic assets was valued at $483.0 million as of September 30, 2025[203]. Shareholder Actions - The Board of Directors authorized a new share repurchase program for up to $125.0 million of common stock[203]. Tax and Interest - Income tax expense for the nine months ended September 30, 2025, was $24.8 million, up from $9.6 million in 2024, with an effective tax rate of 18.8% compared to 40.5% in the prior year[223]. - Interest and dividend income increased for the nine months ended September 30, 2025, due to higher average balances of cash equivalents and other interest-bearing investments[218]. - Interest expense for the three months ended September 30, 2025, decreased by $1.8 million (31%) to $(4.0 million) compared to $(5.8 million) in 2024, and for the nine months, it decreased by $4.1 million (23%) to $(13.4 million) from $(17.5 million) in 2024[220]. Changes in Investments - Changes in fair values of equity method investments for the three months ended September 30, 2025, showed a net gain of $30.8 million compared to a loss of $(18.2 million) in 2024, representing a change of $48.98 million (269%)[221]. Commitments and Agreements - As of September 30, 2025, the company had $261.0 million in notes payable related to its 2028 Notes, with an interest rate of 2.125%[233]. - The company has approximately $14.6 million in outstanding purchase commitments under a Commercial Supply Agreement with Corden Pharma CHENÔVE SAS[237]. - The maximum aggregate royalty payments under the La Jolla Royalty Agreement are capped at $225.0 million, with a maximum royalty rate of 18%[235]. Regulatory Updates - Zoliflodacin is under Priority Review by the FDA, with a target action date of December 15, 2025[203].

Financial Performance - Total revenue for Q3 2025 was $107.8 million, representing a 20% increase from $89.5 million in Q3 2024[4] - Net income for Q3 2025 was $89.9 million, or $1.30 per share, compared to $1.2 million, or $0.02 per share, in Q3 2024[8] - Total revenue for the three months ended September 30, 2025, was $107.8 million, a 20.5% increase from $89.5 million in the same period of 2024[15] - Net product sales reached $47.3 million for the three months ended September 30, 2025, compared to $27.8 million in the prior year, reflecting a 70% growth[15] - Gross profit for the three months ended September 30, 2025, was $75.5 million, up from $73.0 million in 2024, indicating a gross margin improvement[15] - Net income for the three months ended September 30, 2025, was $89.9 million, significantly higher than $1.2 million in the same period of 2024[15] Expenses and Cash Flow - Operating expenses increased to $41.0 million for the three months ended September 30, 2025, from $29.8 million in 2024, primarily due to higher research and development costs[15] - Cash and cash equivalents at the end of the period were $476.5 million, up from $260.6 million at the end of September 2024, representing an 83% increase[19] - The company reported net cash provided by operating activities of $142.4 million for the nine months ended September 30, 2025, compared to $129.5 million in 2024[19] Strategic Developments - The company announced a $125 million share repurchase program, highlighting confidence in its future prospects[3] - ZEVTERA was launched in the U.S. in July 2025, with initial market engagement focused on formulary committee and access programs[8] - Zoliflodacin is under Priority Review by the FDA, with a PDUFA target action date of December 15, 2025[8] - Innoviva invested $15.0 million in a term loan to Armata Pharmaceuticals, which recently reported positive Phase 2 data[12] - Innoviva acquired a proprietary long-acting oral drug delivery platform from Lyndra Therapeutics for $10.2 million, plus potential milestone payments[12] Asset and Equity Growth - The company's strategic assets were valued at $483.0 million as of September 30, 2025[7] - Total assets increased to $1.43 billion as of September 30, 2025, from $1.30 billion at the end of 2024, reflecting strong growth in the balance sheet[17] - The company’s equity increased to $1.01 billion as of September 30, 2025, compared to $691.2 million at the end of 2024, indicating a robust financial position[17] Research and Development - Research and development expenses surged to $13.7 million for the three months ended September 30, 2025, compared to $3.6 million in the same period of 2024, highlighting a focus on innovation[15]