Theravance's (TBPH) Q1 Earnings and Revenues Miss Estimates
Theravance Biopharma TBPH reported first-quarter 2023 net loss of 32 cents per share, wider than the year-ago quarter’s loss of 22 cents. The loss was also wider than the Zacks Consensus Estimate of a loss of 27 cents per share and on par with our estimate of a loss of 32 cents. The above loss excludes restructuring and related costs, including which the loss was 35 cents per share compared with 34 cents in the year-ago quarter.
Total revenues of $10.4 million missed the Zacks Consensus Estimate of $13.8 million and our estimate of $12.4 million. Revenues declined 21% year over year due to a milestone payment received from Pfizer in the year-ago quarter.
Theravance’s shares were down 1.7% in after-hours trading on Monday after the first-quarter results were announced.
Shares of Theravance have surged 20.4% in the past year compared with the industry’s 0.7% increase.
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Quarter in Detail
The top line almost fully comprised Viatris’ VTRS collaboration revenues in relation to Yupelri (revefenacin).
Theravance and Viatris have collaborated for the development and commercialization of the drug. Viatris and Theravance are sharing U.S. profits and losses received in connection with the commercialization of Yupelri. While Viatris gets 65% of the profits, Theravance gets 35%. The Viatris collaboration revenues comprise Theravance’s 35% share of net sales of Yupelri, as well as its proportionate amount of the total shared costs incurred by the two companies. Viatris recognizes the product sales from Yupelri. Viatris also owns a stake in Theravance.
In the first quarter, unfavorably changes in ordering patterns hurt sales of Yupelri, which lowered Theravance’s share of profits.
Research & development expenses were $14.6 million, down 37.3% from the year-ago quarter. Selling, general & administrative expenses rose 7.9% year over year to $19.2 million.
As of Mar 31, 2023, Theravance had cash, cash equivalents and marketable securities worth $260.0 million compared with $327.5 million as of Dec 31, 2022.
2023 Guidance
Theravance expects adjusted research & development expenses (excluding one-time restructuring expenses and share-based compensation) in the $35-$45 million range. Adjusted selling, general and administrative expenses are projected between $45 million and $55 million.
TBPH expects to generate adjusted profit by the second half of 2023.
Pipeline and Other Updates
Theravance is developing an investigational candidate, ampreloxetine (TD-9855), a norepinephrine reuptake inhibitor for the treatment of symptomatic nOH in patients with multiple system atrophy (MSA).
Theravance initiated enrollment in a new phase III clinical study in MSA patients with symptomatic nOH, called CYPRESS, in the first quarter of 2023. The study is expected to complete enrollment by the second half of 2024.
In previous clinical studies, ampreloxetine led to increased norepinephrine levels, prevented a drop in blood pressure and prevented symptom worsening in patients with MSA
Through April 2023, the company repurchased $215 million of stock of the $325 million shares authorized to be repurchased. The remaining $110 million is expected to be completed by the end of 2023.
Zacks Rank & Stocks to Consider
Theravance currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the same sector are Larimar Therapeutics LRMR and Iterum Therapeutics ITRM), both with a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Loss estimates for Larimar Therapeutics have narrowed from $2.07 per share to $1.08 per share for 2023 over the past 60 days and from $2.28 per share to $1.15 per share for 2024. Shares of Larimar Therapeutics have risen 64.8% in the past year.
Earnings of LRMR beat estimates in each of the trailing four quarters, delivering an average earnings surprise of 36.06%. In the last reported quarter, LRMR earnings beat estimates by 73.08%.
Loss estimates for Iterum Therapeutics have narrowed from $5.91 per share to $3.55 per share for 2023 over the past 60 days and from $4.95 per share to $3.37 per share for 2024. Shares of Iterum Therapeutics have declined 65.7% in the past year.
ITRM delivered an average four-quarter earnings surprise of 7.81%.
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