Theravance Biopharma Inc (TBPH) Q4 2024 Earnings Call Highlights: Record Sales and Strategic ...

GuruFocus.com
27 Feb
  • Upell Net Sales: Increased 10% year-over-year in Q4 2024, reaching $66.7 million.
  • Full Year Upell Sales: $239 million, with highest profitability since launch.
  • Hospital Doses: 285,000 doses, up 49% year-over-year.
  • Trilogy Milestone Payment: $50 million earned from Royalty Pharma based on GSK's 2024 sales.
  • Collaboration Revenue: Grew by 8% to approximately $19 million in Q4 2024.
  • Operating Expenses: Increased to $22 million in Q4 2024, due to commercial and R&D activities.
  • Cash Utilization: $3 million in Q4 2024, $14 million for the full year.
  • Cash Balance: Ended 2024 with $88 million, excluding the $50 million milestone receipt.
  • 2025 R&D Expense Guidance: $32 to $38 million, excluding share-based compensation.
  • 2025 SG&A Expense Guidance: $50 to $60 million, excluding share-based compensation.
  • 2025 Share-Based Compensation Guidance: $18 to $20 million.
  • Non-GAAP Losses and Cash Burn: Expected to be similar to 2024 levels.
  • Warning! GuruFocus has detected 4 Warning Signs with TBPH.

Release Date: February 26, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Theravance Biopharma Inc (NASDAQ:TBPH) reported a 10% increase in Upell net sales for the fourth quarter of 2024, reaching an all-time high of $66.7 million.
  • The company achieved a $50 million milestone payment from Royalty Pharma based on 2024 trilogy net sales reported by GSK.
  • Theravance Biopharma Inc (NASDAQ:TBPH) is on track with the development timelines for amproloxetine, with solid enrollment in the Cyprus study and positive interactions with the FDA.
  • The company has extended IP protection for Upell to 2039, providing long-term revenue potential.
  • Theravance Biopharma Inc (NASDAQ:TBPH) maintained strong expense management, delivering full-year results within guidance ranges and ending the year with $88 million in cash, excluding recent milestone receipts.

Negative Points

  • Theravance Biopharma Inc (NASDAQ:TBPH) anticipates typical seasonal dips in reported net sales as they transition from the fourth quarter to the first quarter of the following year.
  • The company faces potential challenges in achieving the remaining $150 million of trilogy milestones, with recognition of other income only if cumulative milestones exceed $194 million.
  • Operating expenses increased due to incremental commercial and medical affairs spend on amproloxetine pre-launch activities and increased R&D expenses.
  • The company is waiting for regulatory decisions in China, which could impact the timing of potential sales milestones and royalties.
  • Theravance Biopharma Inc (NASDAQ:TBPH) has not yet increased the size of its commercial organization for amproloxetine, pending the results of the Cyprus study, which could delay market readiness.

Q & A Highlights

Q: What drove the success of the hospital channel this quarter? A: Rhonda Farnum, Senior Vice President - Commercial and Medical Affairs, Chief Business Officer, explained that the success was due to the team's clear execution of strategy, focusing on larger systems and therapeutic interchange, which brings additional volume. The team ensured that the product was adopted in protocols and converted short-acting use to long-acting, achieving significant results with a small team.

Q: Can you provide an update on the regulatory process for Upellary in China? A: Rhonda Farnum stated that they are waiting for regulatory feedback from the Chinese authorities. The planning assumption is a two-year window from submission to approval, which was submitted in June 2024. This timeline aligns with expectations for a potential $7.5 million milestone and high royalties on sales.

Q: What feedback did you receive from the FDA regarding Amproloxetine? A: Rick Winningham, CEO, mentioned that the interaction with the FDA was a Type C meeting to ensure understanding of the filing content and FDA expectations. This was part of good regulatory practice to prepare for an expedited filing once the Cyprus study results are available.

Q: What is the bar for success for the Cyprus readout, and what are the plans for the commercial organization if positive? A: Rick Winningham stated that a one-point change in the OHSA composite score is considered clinically meaningful. If Cyprus is positive, they plan to hold off on increasing the organization size until after the data is available. Rhonda Farnum added that they aim to be efficient with a focused sales effort, targeting around 3,000 prescribers across 250 centers.

Q: Was there any channel stocking or anomalies that benefited the fourth-quarter net revenue? A: Rick Winningham confirmed that inventory levels were consistent with previous years, indicating no unusual stocking. Rhonda Farnum clarified that the hospital business accounts for about 10% of total brand volume, with the majority in the community setting, which is growing.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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