Theravance Inc. (THRX): New Analyst Report from Zacks Equity Research - Zacks Equity Research Report
Summary:
Theravance's third-quarter 2014 loss of $0.19 per share was wider than the Zacks Consensus Estimate of a loss of $0.15. Theravance split into two publicly traded companies in June last year. The company dealing with products/candidates pertaining to the Glaxo partnership has retained the company's name. This was the first quarter for Theravance as a royalty management company. We are positive on the approval of COPD drugs, Breo Ellipta and Anoro Ellipta, in the U.S. The reintroduction of Vibativ in the U.S. is also encouraging. However, we prefer to remain on the sidelines until more visibility is obtained on the commercialization of the drugs. Our target price is $13.00 per share.
Overview:
Theravance, Inc. in its present form (a royalty management company) came into being in June this year following the split-off of the original Theravance into two listed companies. The company, headquartered in South San Francisco, CA, focuses on the development of respiratory candidates under its agreement with Glaxo. Theravance earns associated royalties from the sale of approved drugs under the partnership.
The marketed products of the company are Relvar/Breo Ellipta and Anoro Ellipta. While Relvar/Breo Ellipta is a combination of an inhaled corticosteroid (fluticasone furoate (FF)) and a long-acting beta2-adrenergic agonist (vilanterol (VI)), Anoro Ellipta is a combination of a long-acting muscarinic antagonist (umeclidinium (UMEC)) and a long-acting beta2 agonist (vilanterol (VI)). Apart from Anoro Ellipta and Breo Ellipta, the candidates under development through the Glaxo/Theravance partnership also hold promise.
Theravance receives royalties from Glaxo on Breo/Relvar Ellipta global annual sales at the rate of 15% on the first $3 billion and 5% thereafter. The royalty structure for Anoro Ellipta is 6.5% to 10% of annual global net sales.
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