Theravance Biopharma(TBPH) - 2024 Q1 - Quarterly Results

Company Overview and Q1 2024 Highlights The company reports solid Q1 2024 performance driven by YUPELRI sales growth and progress in its ampreloxetine clinical trial CEO Commentary The CEO highlights strong YUPELRI sales execution and ongoing progress in the ampreloxetine CYPRESS study - The CEO emphasizes a continued focus on YUPELRI growth and CYPRESS study execution, with plans to share ampreloxetine progress at an upcoming investor event[3] First Quarter Operational Highlights YUPELRI showed significant Q1 growth in sales and market share, while the ampreloxetine CYPRESS study continues global enrollment YUPELRI Q1 2024 Performance | Metric | Q1 2024 | Q1 2023 | Change (YoY) | | :--- | :--- | :--- | :--- | | YUPELRI Net Sales (Viatris) | $55.2 million | N/A | +18% | | Hospital Doses Sold | N/A | N/A | +31% | | Community LA-NEB Market Share | 30.5% | 28.0% | +2.5 pp | | Hospital LA-NEB Market Share | 16.6% | 15.0% | +1.6 pp | - Enrollment for the ampreloxetine CYPRESS study continues globally, expanding to Latin America and Asia Pacific, with open-label period completion expected in H2 2024[7] First Quarter Financial Highlights The company reports an 18% increase in YUPELRI net sales and a 39% rise in Viatris collaboration revenue for Q1 2024 Q1 2024 Financial Metrics | Metric | Q1 2024 | Q1 2023 | Change (YoY) | | :--- | :--- | :--- | :--- | | YUPELRI Net Sales (Viatris) | $55.2 million | N/A | +18% | | Viatris Collaboration Revenue | $14.5 million | N/A | +39% | | Ending Cash Balance | $100 million | N/A | N/A | Product Updates and Pipeline Progress This section details the strong commercial performance of YUPELRI, clinical development progress for ampreloxetine, and royalty updates for TRELEGY YUPELRI (revefenacin) Performance YUPELRI demonstrated robust Q1 2024 growth with an 18% year-over-year increase in net sales and expanded market share YUPELRI Q1 2024 Performance Metrics | Metric | Q1 2024 | Q1 2023 | Change (YoY) | | :--- | :--- | :--- | :--- | | YUPELRI Net Sales (Viatris) | $55.2 million | $46.955 million | +18% | | YUPELRI Implied 35% Share | $19.3 million | $16.434 million | +18% | | Hospital Doses Sold | N/A | N/A | +31% | | Community LA-NEB Market Share | 30.5% | 28.0% | +2.5 pp | | Hospital LA-NEB Market Share | 16.6% | 15.0% | +1.6 pp | Ampreloxetine Development The Phase 3 CYPRESS study for ampreloxetine is advancing with global enrollment for treating symptomatic nOH in MSA patients - Enrollment for the CYPRESS study is ongoing globally, with expansion into Latin America and Asia Pacific, and the open-label period is expected to conclude in the second half of 2024[7] - Ampreloxetine has received Orphan Drug Designation in the US for symptomatic nOH in MSA patients, with plans for an NDA filing if Phase 3 CYPRESS study results are supportive[15] About Ampreloxetine Ampreloxetine is an investigational norepinephrine reuptake inhibitor for symptomatic neurogenic orthostatic hypotension in MSA patients - Ampreloxetine is an investigational, once-daily norepinephrine reuptake inhibitor for symptomatic nOH in MSA patients[4][15] - Benefits observed in Study 0170 included increased norepinephrine levels, favorable blood pressure impact, clinically meaningful and durable symptom improvement, and no signal for supine hypertension[15] About CYPRESS (Study 0197), a Phase 3 Study The CYPRESS study is a registrational Phase 3 trial evaluating ampreloxetine's efficacy and durability in MSA patients with symptomatic nOH - CYPRESS is a registrational Phase 3, multi-center, randomized withdrawal study evaluating ampreloxetine in MSA patients with symptomatic nOH[18] - The primary endpoint is the change in the Orthostatic Hypotension Symptom Assessment (OHSA) composite score, with secondary measures including OHDAS items 1 and 3[18] About Multiple System Atrophy (MSA) and Symptomatic Neurogenic Orthostatic Hypotension (nOH) MSA is a progressive brain disorder where nOH is a frequent and debilitating symptom affecting a significant portion of patients - MSA is a progressive brain disorder affecting movement, balance, and the autonomic nervous system, with nOH as a frequent symptom[19] - nOH affects 70-90% of the estimated 50,000 MSA patients in the US, causing debilitating symptoms like dizziness and fainting, with many patients remaining symptomatic despite current treatments[19][20] TRELEGY Royalty Update TRELEGY global net sales grew 32% year-over-year, positioning the company for potential milestone payments from Royalty Pharma TRELEGY Q1 2024 Net Sales | Metric | Q1 2024 | Q1 2023 | Change (YoY) | | :--- | :--- | :--- | :--- | | TRELEGY Global Net Sales (GSK) | $749 million | $567 million | +32% | - Theravance Biopharma is eligible for up to $200 million in milestone payments from Royalty Pharma for TRELEGY sales[8] - The next $25 million milestone payment is expected if TRELEGY global net sales reach approximately $2.9 billion in 2024 (5% increase YoY), with another $25 million if sales exceed $3.2 billion (17% increase YoY)[8][10] First Quarter Financial Results The company reports a 39% increase in total revenue and a significant reduction in operating expenses and net loss for Q1 2024 Revenue and Collaboration Income Total revenue rose 39% year-over-year to $14.5 million, driven by higher YUPELRI net sales and lower associated costs Q1 Revenue Details | Metric | Q1 2024 (in thousands) | Q1 2023 (in thousands) | Change (YoY) | | :--- | :--- | :--- | :--- | | Total Revenue | $14,503 | $10,417 | +39% | | Viatris Collaboration Revenue | $14,503 | $10,411 | +39% | | Implied 35% Share of YUPELRI Net Sales | $19,329 | $16,434 | +18% | Operating Expenses Operating expenses decreased significantly due to lower R&D and SG&A spending, reflecting improved cost management Q1 Operating Expenses | Expense Category | Q1 2024 (in thousands) | Q1 2023 (in thousands) | Change (YoY) | | :--- | :--- | :--- | :--- | | R&D Expenses | $8,968 | $14,572 | -38.4% | | SG&A Expenses | $16,742 | $19,183 | -12.5% | | Restructuring & Related Expenses | $0 | $1,574 | -100% | | Total Share-Based Compensation | $5,229 | $7,021 | -25.6% | Net Loss and EPS The company substantially narrowed its GAAP and non-GAAP net losses in Q1 2024 compared to the prior year period Q1 Net Loss Summary | Metric | Q1 2024 (in thousands) | Q1 2023 (in thousands) | Change (YoY) | | :--- | :--- | :--- | :--- | | GAAP Net Loss | $(11,664) | $(22,088) | -47.2% | | Non-GAAP Net Loss | $(4,544) | $(14,912) | -69.5% | | Basic & Diluted Net Loss Per Share | $(0.24) | $(0.35) | N/A | Cash Position The company maintained a solid cash position, ending the first quarter of 2024 with $100.0 million in cash and marketable securities Cash and Equivalents | Metric | March 31, 2024 (in thousands) | December 31, 2023 (in thousands) | Change | | :--- | :--- | :--- | :--- | | Cash, Cash Equivalents & Marketable Securities | $99,975 | $102,426 | $(2,451) | 2024 Financial Guidance The company reaffirms its full-year 2024 operating expense guidance and projects approaching non-GAAP breakeven in the second half Operating Expenses Outlook The company maintains its full-year 2024 guidance for R&D and SG&A expenses, excluding share-based compensation 2024 Operating Expense Guidance | Expense Category (Excl. Share-Based Comp.) | Full Year 2024 Guidance | | :--- | :--- | | R&D Expenses | $30 million - $36 million | | SG&A Expenses | $45 million - $55 million | Share-Based Compensation Outlook Full-year 2024 share-based compensation expenses are projected to be between $18 million and $22 million 2024 Share-Based Compensation Guidance | Expense Category | Full Year 2024 Guidance | | :--- | :--- | | Share-Based Compensation Expenses | $18 million - $22 million | Non-GAAP Net Profit / Loss Outlook The company anticipates a non-GAAP net loss in H1 2024, moving towards breakeven in H2 2024 with limited annual cash burn - The company expects a non-GAAP net loss in H1 2024 and to approach non-GAAP breakeven in H2 2024[17] - Limited cash burn is expected for the full year 2024[17] Non-GAAP Financial Measures Explanation This section explains the company's use of non-GAAP metrics to supplement GAAP results for performance analysis Non-GAAP Financial Measures Explanation The company utilizes non-GAAP metrics, excluding certain non-cash items, to provide investors with additional insight into core performance - Non-GAAP profit (loss) is defined as GAAP net income (loss) before taxes, less share-based compensation expense and non-cash interest expense[16] - Non-GAAP measures are used to provide better metrics for analyzing business performance by excluding items not indicative of core operating results and cash position[26] - These non-GAAP measures are not standardized and should be considered in addition to, not as a substitute for, GAAP results[26] Corporate Information This section provides an overview of the company's mission, key products, and standard forward-looking statement disclaimers About Theravance Biopharma The company is focused on developing impactful medicines, highlighted by its approved COPD therapy YUPELRI and late-stage asset ampreloxetine - Theravance Biopharma's mission is to deliver "Medicines that Make a Difference" in people's lives[21] - Key products include FDA-approved YUPELRI for COPD and late-stage investigational ampreloxetine for symptomatic nOH in MSA patients, which has potential as a first-in-class therapy[21] Forward-Looking Statements This press release contains forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially - The press release contains forward-looking statements regarding future profitability, expenses, YUPELRI sales growth, royalty payments, clinical study timing, and regulatory strategies[24] - These statements are based on current estimates and assumptions and are subject to risks, uncertainties, and changes in circumstances that may cause actual results to differ materially[24] - Important factors include risks related to cash requirements, clinical study delays, product safety/efficacy, regulatory decisions, third-party dependencies, intellectual property, and general economic conditions[24] Condensed Consolidated Financial Statements This section presents the company's unaudited balance sheets, statements of operations, and reconciliation of GAAP to non-GAAP net loss Condensed Consolidated Balance Sheets Total assets stood at $371.3 million as of March 31, 2024, with cash and equivalents at $100.0 million Balance Sheet Summary | Balance Sheet Item (in thousands) | March 31, 2024 | December 31, 2023 | Change | | :--- | :--- | :--- | :--- | | Total Assets | $371,307 | $381,999 | $(10,692) | | Cash and cash equivalents and short-term marketable securities | $99,975 | $102,426 | $(2,451) | | Receivables from collaborative arrangements | $14,664 | $17,474 | $(2,810) | | Future contingent milestone and royalty assets | $194,200 | $194,200 | $0 | | Total Liabilities | $166,439 | $163,704 | $2,735 | | Shareholders' Equity | $204,868 | $212,995 | $(8,127) | Condensed Consolidated Statements of Operations The company reported a net loss of $11.7 million on total revenues of $14.5 million for the first quarter of 2024 Q1 2024 Statement of Operations | Income Statement Item (in thousands) | Q1 2024 | Q1 2023 | Change (YoY) | | :--- | :--- | :--- | :--- | | Total Revenue | $14,503 | $10,417 | +39.2% | | Research and Development | $8,968 | $14,572 | -38.4% | | Selling, General and Administrative | $16,742 | $19,183 | -12.7% | | Total Costs and Expenses | $25,710 | $35,329 | -27.2% | | Loss from Operations | $(11,207) | $(24,912) | -55.0% | | Net Loss | $(11,664) | $(22,088) | -47.2% | | Basic and Diluted Net Loss Per Share | $(0.24) | $(0.35) | N/A | Q1 2024 Share-Based Compensation | Share-Based Compensation (in thousands) | Q1 2024 | Q1 2023 | Change (YoY) | | :--- | :--- | :--- | :--- | | Research and Development | $1,465 | $2,441 | -40.1% | | Selling, General and Administrative | $3,764 | $4,223 | -10.9% | | Restructuring and Related Expenses | $0 | $357 | -100% | | Total Share-Based Compensation Expense | $5,229 | $7,021 | -25.6% | Reconciliation of GAAP to Non-GAAP Net Loss The non-GAAP net loss for Q1 2024 was $4.5 million, a 69.5% improvement from the $14.9 million loss in Q1 2023 GAAP to Non-GAAP Reconciliation | Metric (in thousands) | Q1 2024 | Q1 2023 | Change (YoY) | | :--- | :--- | :--- | :--- | | GAAP Net Loss | $(11,664) | $(22,088) | -47.2% | | Share-Based Compensation Expense | $5,229 | $7,021 | -25.6% | | Non-Cash Interest Expense | $629 | $550 | +14.4% | | Income Tax Expense (Benefit) | $1,262 | $(395) | N/A | | Non-GAAP Net Loss | $(4,544) | $(14,912) | -69.5% |