News
Theravance, Inc. (NASDAQ: THRX) reported today its financial results
for the fourth quarter and full year ended December 31, 2011. Revenue
for the full year was $24.5 million. Net loss for the fourth quarter
and full year of 2011 was $37.0 million and $115.3 million,
respectively, compared with $19.3 million and $83.9 million for the
same periods of 2010. Net loss per share was $0.45 and $1.41 for the
fourth quarter and full year of 2011, respectively, compared with a
net loss per share of $0.25 and $1.16 for the same periods of 2010.
Cash, cash equivalents, and marketable securities totaled $240.9
million as of December 31, 2011, a decrease of $68.7 million since
December 31, 2010.
"I am very pleased with the progress Theravance has made since the
beginning of 2011 and I am excited by our potential milestones in
2012," said Rick E Winningham, Chief Executive Officer. "In our two
lead respiratory programs with GSK, we expect GSK to submit regulatory
filings for RELOVAIR in both COPD and asthma, and to complete the
Phase 3 registrational program with LAMA/LABA this year. Recently, GSK
announced the completion of a low-dose Phase 2b study in COPD with
'719 and that the results of this study support the doses and dosing
regimen being studied in Phase 3. Together, these programs provide the
opportunity to treat a wide range of patients suffering from these
serious diseases. We look forward to another productive and successful
year."
Program Highlights
Respiratory Programs with GlaxoSmithKline plc (GSK)
RELOVAIR
RELOVAIR is an investigational once-daily inhaled corticosteroid
(ICS)/long-acting beta2 agonist (LABA) combination treatment,
comprising fluticasone furoate and vilanterol (FF/VI), currently in
development for the treatment of patients with chronic obstructive
pulmonary disease (COPD) or asthma.
In January 2012, Theravance and GSK announced that GSK intends to
commence global regulatory filings in COPD and asthma beginning in
mid-2012 based upon the initial outcomes from pivotal Phase 3 studies
for once-daily RELOVAIR in COPD and asthma. For asthma, GSK will
continue discussions with the U.S. Food and Drug Administration (FDA)
on the regulatory requirements for a U.S. asthma indication.
LAMA/LABA Combination (GSK573719/Vilanterol or '719/VI)
Enrollment is complete for the seven ongoing studies in the Phase 3a
program for the once-daily LAMA/LABA dual bronchodilator '719/VI.
'719/VI combines two bronchodilators currently under development --
'719, a long-acting muscarinic antagonist (LAMA) and VI, a LABA. These
two molecules provide two mechanisms of bronchodilation for patients
with COPD: antagonism of acetylcholine muscarinic receptors and
agonism of beta2 adrenoreceptors.
The LAMA/LABA Phase 3a program, which will evaluate over 5,000
patients with COPD globally, consists of a 52-week study to evaluate
the long term safety and tolerability of '719 (125mcg) alone, as well
as the combination '719/VI (125/25mcg), two large 6-month pivotal
studies that will compare improvements in lung function between
'719/VI, its components and placebo, two 6-month studies to compare
the combination with its components and tiotropium and two studies to
assess the effect of '719/VI on exercise endurance. The Phase 3
program will investigate two doses of '719 (125mcg and 62.5mcg) and
two doses of the combination '719/VI (125/25mcg and 62.5/25mcg). The
LAMA/LABA Phase 3 program is expected to be completed in 2012.
In October 2011, data from a Phase 2b study of '719 was presented at
CHEST, the annual meeting of the American College of Chest Physicians
(ACCP), in Honolulu, Hawaii. Recently, GSK announced the completion of
a Phase 2b study evaluating lower doses of '719 in COPD. The results
of this study support the doses and dosing regimen being studied in
Phase 3.
Inhaled Bifunctional Muscarinic Antagonist-Beta2 Agonist (MABA)
'081 is a single molecule bifunctional bronchodilator with both
muscarinic antagonist and beta2 receptor agonist activity. GSK
recently completed a Phase 2b study with '081 and Theravance expects
to report topline data during the first half of 2012. In addition, a
Phase 1 study with '081 in combination with fluticasone propionate
(FP), an ICS, has been completed, and a number of non-clinical studies
are ongoing.
In October 2011, Theravance and GSK amended the 2004 Strategic
Alliance Agreement to expand the MABA program. Theravance granted to
GSK an exclusive license to develop and commercialize additional
preclinical MABA compounds discovered by Theravance. Theravance
received an upfront payment of $1.0 million and has the potential to
receive clinical, regulatory and commercial milestone payments as well
as royalties on worldwide net sales if one of these MABA compounds is
successfully commercialized. In connection with this amendment,
Theravance regained full rights to its MonoAmine Reuptake INhibitor
(MARIN) program, which is currently in Phase 2 development, and its
Angiotensin Receptor-NEP Inhibitor (ARNI) program in preclinical
development.
Theravance Respiratory Program
Long-Acting Muscarinic Antagonist (LAMA) -- TD-4208
In November 2011, Theravance announced positive topline results from a
Phase 2a single-dose COPD study of TD-4208, an investigational inhaled
LAMA discovered by Theravance. In this study, TD-4208 met the primary
endpoint by demonstrating a statistically significant mean change from
baseline in peak forced expiratory volume in one second (FEV1)
compared to placebo, and was generally well-tolerated.
Bacterial Infections
VIBATIV@ (telavancin) for injection
On January 6, 2012, Theravance regained full global rights to
VIBATIV@, a bactericidal, once-daily injectable lipoglycopeptide
antibiotic discovered by Theravance and approved for use in the U.S.,
Canada and the European Union. Theravance is evaluating global
commercialization alternatives for VIBATIV@ either alone or with
partners.
Central Nervous System (CNS)/Pain Program
Oral Peripheral Mu Opioid Receptor Antagonist (P?MA) -- TD-1211
Enrollment is progressing in the Phase 2b program, which will assess
the safety, tolerability and clinical activity of TD-1211 in patients
with opioid-induced constipation (OIC). This program is evaluating
several doses and dosing regimens to provide information for the
design of the Phase 3 program. TD-1211 is an investigational
once-daily, orally-administered, peripherally selective, multivalent
inhibitor of the mu opioid receptor designed to alleviate
gastrointestinal side effects of opioid therapy without affecting
analgesia.
MonoAmine Reuptake INhibitor (MARIN) -- TD-9855
In December 2011, Theravance announced the initiation of an
Attention-Deficit/Hyperactivity Disorder (ADHD) Phase 2
proof-of-concept study with TD-9855, the lead compound in Theravance's
MARIN program. This Phase 2 study will evaluate the safety and
efficacy of two different doses of TD-9855 in adults with ADHD.
TD-9855 is an investigational norepinephrine and serotonin reuptake
inhibitor (NSRI) discovered by Theravance for the treatment of central
nervous system (CNS) conditions such as ADHD and chronic pain.
Financial Results
Revenue
Revenue was $5.4 million for the fourth quarter of 2011 compared with
$6.9 million for the same period in 2010, a decrease of $1.5 million.
During the fourth quarter, $0.3 million of royalty revenue was earned
from VIBATIV@ net sales of $1.6 million. For the full year of 2011,
revenue was $24.5 million, compared with $24.2 million for the full
year of 2010.
Research and Development
Research and development expense for the fourth quarter of 2011
increased to $32.5 million compared with $17.5 million for the same
period in 2010. For the full year of 2011, research and development
expense was $103.5 million compared with $75.1 million for the full
year 2010. The increase in the fourth quarter and the full year of
2011 was primarily due to clinical costs related to our P?MA and MARIN
programs and preclinical expenses related to our Hepatitis C virus
(HCV) and cardiovascular programs in late-stage discovery. Total
external research and development expense for the fourth quarter and
full year of 2011 was $12.9 million and $30.8 million, respectively,
compared with $1.3 million and $12.2 million, respectively, for the
fourth quarter and full year 2010. Total research and development
stock-based compensation expense for the fourth quarter and full year
2011 was $3.4 million and $13.4 million, respectively, compared with
$2.6 million and $10.3 million, respectively, for the fourth quarter
and full year 2010.
General and Administrative
General and administrative expense for the fourth quarter of 2011
increased to $8.5 million from $7.4 million for the same period in
2010. For the full year of 2011, general and administrative expense
was $30.7 million compared with $27.5 million for the full year of
2010. The increase in the fourth quarter and the full year of 2011 was
primarily due to higher employee-related and external expenses offset
by lower facilities-related costs. Total general and administrative
stock-based compensation expense for the fourth quarter and full year
of 2011 was $2.8 million and $11.5 million, respectively, compared
with $2.1 million and $8.7 million, respectively, for the fourth
quarter and full year of 2010.
Cash and Cash Equivalents
Cash, cash equivalents and marketable securities totaled $240.9
million as of December 31, 2011, a decrease of $24.3 million during
the fourth quarter. This decrease was primarily due to cash used in
operations offset by the $1.0 million upfront license fee received
from GSK upon licensing the preclinical MABAs in October 2011 and $1.3
million received from GSK for the purchase of common stock in November
2011.
Conference Call and Webcast Information
As previously announced, the Company has scheduled a conference call
to discuss this announcement beginning at 5:00 p.m. Eastern Standard
Time. To participate in the live call by telephone, please dial (877)
837-3908 from the U.S., or (973) 890-8166 for international callers.
Those interested in listening to the conference call live via the
internet may do so by visiting the company's web site at
www.theravance.com(http://ctt.marketwire.com/?release849975&id1250332&type1&urlhttp%3a%2f%2...).
To listen to the live call, please go to the web site 15 minutes prior
to its start to register, download, and install any necessary audio
software.
A replay of the conference call will be available on the company's web
site for 30 days through March 10, 2012. An audio replay will also be
available through 11:59 p.m. Eastern Standard Time on February 16,
2012 by dialing (855) 859-2056 from the U.S., or (404) 537-3406 for
international callers, and entering confirmation code 43487593.
About Theravance
Theravance is a biopharmaceutical company with a pipeline of
internally discovered product candidates and strategic collaborations
with pharmaceutical companies. Theravance is focused on the discovery,
development and commercialization of small molecule medicines across a
number of therapeutic areas including respiratory disease, bacterial
infections, and central nervous system (CNS)/pain. The Company's key
programs include: RELOVAIR, LAMA/LABA ('719/vilanterol (VI)) and MABA
(Bifunctional Muscarinic Antagonist-Beta2 Agonist), each partnered
with GlaxoSmithKline plc, and its oral Peripheral Mu Opioid Receptor
Antagonist (P?MA) program. By leveraging its proprietary insight of
multivalency to drug discovery, Theravance is pursuing a best-in-class
strategy designed to discover superior medicines in areas of
significant unmet medical need. For more information, please visit the
company's web site at
www.theravance.com(http://ctt.marketwire.com/?release849975&id1250335&type1&urlhttp%3a%2f%2...).
THERAVANCE@, the Theravance logo, and MEDICINES THAT MAKE A
DIFFERENCE@ are registered trademarks of Theravance, Inc.
RELOVAIR is a trademark of the GlaxoSmithKline group of companies.
VIBATIV@ is a registered trademark of Astellas Pharma Inc.
This press release contains and the conference call will contain
certain "forward-looking" statements as that term is defined in the
Private Securities Litigation Reform Act of 1995 regarding, among
other things, statements relating to goals, plans, objectives and
future events. Theravance intends such forward-looking statements to
be covered by the safe harbor provisions for forward-looking
statements contained in Section 21E of the Exchange Act and the
Private Securities Litigation Reform Act of 1995. Examples of such
statements include statements relating to the timing of clinical
studies, data analysis and communication, statements regarding the
potential benefits and mechanisms of action of drug candidates,
statements concerning the timing of seeking regulatory approval of our
product candidates, statements concerning enabling capabilities of
Theravance's approach to drug discovery and its proprietary insights,
statements concerning expectations for product candidates through
development and commercialization and projections of revenue, expenses
and other financial items. These statements are based on the current
estimates and assumptions of the management of Theravance as of the
date of this press release and the conference call and are subject to
risks, uncertainties, changes in circumstances, assumptions and other
factors that may cause the actual results of Theravance to be
materially different from those reflected in its forward-looking
statements. Important factors that could cause actual results to
differ materially from those indicated by such forward-looking
statements include, among others, risks related to delays or
difficulties in commencing or completing clinical studies, the
potential that results of clinical or non-clinical studies indicate
product candidates are unsafe or ineffective, our dependence on third
parties in the conduct of our clinical studies, delays or failure to
achieve regulatory approvals for product candidates, risks of relying
on third-party manufacturers for the supply of our product and product
candidates and risks of collaborating with third parties to develop
and commercialize products. These and other risks are described in
greater detail under the heading "Risk Factors" contained in
Theravance's Quarterly Report on Form 10-Q filed with the Securities
and Exchange Commission (SEC) on November 2, 2011 and the risks
discussed in our other period filings with SEC. Given these
uncertainties, you should not place undue reliance on these
forward-looking statements. Theravance assumes no obligation to update
its forward-looking statements.
THERAVANCE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
--------------------------------------------------
2011 2010 2011 2010
------------------------ ------------------------
(unaudited) (unaudited) (2)
------------------------ ------------------------
Revenue $ 5,361 $ 6,942 $ 24,512 $ 24,223
Operating expenses:
Research and
development (1) 32,468 17,476 103,568 75,070
General and
administrative (1) 8,469 7,400 30,681 27,476
----------- ----------- ----------- -----------
Total operating expenses 40,937 24,876 134,249 102,546
----------- ----------- ----------- -----------
Loss from operations (35,576) (17,934) (109,737) (78,323)
Interest and other
income 71 141 415 505
Interest expense (1,502) (1,506) (6,022) (6,044)
----------- ----------- ----------- -----------
Net loss $ (37,007) $ (19,299) $ (115,344) $ (83,862)
Basic and diluted net
loss per share $ (0.45) $ (0.25) $ (1.41) $ (1.16)
Shares used in computing
basic and diluted net
loss per share 82,862 76,210 82,051 72,070
(1) Amounts include stock-based compensation expense for the three months
and twelve months ended December 31 as follows (in thousands):
Three Months Ended Twelve Months
December 31, Ended December 31,
------------------------ ------------------------
2011 2010 2011 2010
------------------------ ------------------------
(unaudited) (unaudited)
Research and development $ 3,401 $ 2,613 $ 13,422 $ 10,322
General and
administrative 2,809 2,080 11,494 8,687
----------- ----------- ----------- -----------
Total stock-based
compensation expense $ 6,210 $ 4,693 $ 24,916 $ 19,009
(2) The condensed consolidated statement of operations amounts for the year
ended December 31, 2010 are derived from audited financial statements.
THERAVANCE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
December 31, December 31,
2011 2010
------------ ------------
(unaudited) (2)
------------ ------------
Assets
Cash, cash equivalents and marketable
securities $ 240,915 $ 309,634
Other current assets 3,848 6,720
Property and equipment, net 10,372 10,215
Other assets 3,647 4,633
------------ ------------
Total assets $ 258,782 $ 331,202
Liabilities and stockholders' net capital
deficiency
Current liabilities (1) $ 45,496 $ 40,054
Deferred revenue 122,017 137,425
Convertible subordinated notes 172,500 172,500
Other long-term liabilities 5,821 3,643
Stockholders' net capital deficiency (87,052) (22,420)
------------ ------------
Total liabilities and stockholders' net
capital deficiency $ 258,782 $ 331,202
(1) Amounts include current portion of deferred revenue of $18.7 million and
$21.9 million as of December 31, 2011 and December 31, 2010, respectively.
(2) The condensed consolidated balance sheet amounts at December 31, 2010
are derived from audited financial statements.
