Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Feb. 21, 2022 | Jun. 30, 2021 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Document Transition Report | false | ||
Entity File Number | 001-36033 | ||
Entity Registrant Name | THERAVANCE BIOPHARMA, INC. | ||
Entity Incorporation, State or Country Code | KY | ||
Entity Tax Identification Number | 98-1226628 | ||
Entity Address, Address Line One | P.O. Box 309 | ||
Entity Address, Address Line Two | Ugland House, South Church Street | ||
Entity Address, City or Town | George Town, Grand Cayman | ||
Entity Address, Country | KY | ||
Entity Address, Postal Zip Code | KY1-1104 | ||
City Area Code | 650 | ||
Local Phone Number | 808-6000 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Title of 12(b) Security | Ordinary Share $0.00001 Par Value | ||
Trading Symbol | TBPH | ||
Security Exchange Name | NASDAQ | ||
Entity Public Float | $ 882.1 | ||
Entity Common Stock, Shares Outstanding | 74,696,687 | ||
Auditor Name | Ernst & Young LLP | ||
Auditor Firm ID | 42 | ||
Auditor Location | Redwood City, California | ||
Entity Central Index Key | 0001583107 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 89,959 | $ 81,467 |
Short-term marketable securities | 83,506 | 211,474 |
Receivables from collaborative arrangements | 14,065 | 15,868 |
Amounts due from TRC, LLC | 43,534 | 53,799 |
Prepaid clinical and development services | 10,245 | 20,374 |
Other prepaid and current assets | 8,561 | 10,359 |
Total current assets | 249,870 | 393,341 |
Property and equipment, net | 13,657 | 16,422 |
Operating lease assets | 39,690 | 43,260 |
Equity in net assets of TRC, LLC | 67,537 | 12,750 |
Restricted cash | 837 | 833 |
Other assets | 3,228 | 2,451 |
Total assets | 374,819 | 469,057 |
Current liabilities: | ||
Accounts payable | 3,098 | 6,775 |
Accrued personnel-related expenses | 12,796 | 35,238 |
Accrued clinical and development expenses | 17,010 | 28,799 |
Accrued general and administrative expenses | 2,898 | 6,048 |
Accrued interest payable | 3,940 | 3,974 |
Current portion of non-recourse notes due 2035, net | 16,940 | 19,334 |
Operating lease liabilities | 503 | 9,867 |
Deferred revenue | 98 | 11,523 |
Other accrued liabilities | 1,304 | 2,013 |
Total current liabilities | 58,587 | 123,571 |
Convertible senior notes due 2023, net | 228,035 | 226,963 |
Non-recourse notes due 2035, net | 371,359 | 372,873 |
Long-term operating lease liabilities | 52,681 | 47,220 |
Long-term deferred revenue | 310 | 348 |
Other long-term liabilities | 2,420 | 1,833 |
Commitments and contingencies | ||
Shareholders' Deficit | ||
Preferred shares, $0.00001 par value: 230 shares authorized, no shares issued or outstanding | ||
Ordinary shares, $0.00001 par value: 200,000 shares authorized; 74,435 and 64,328 shares issued and outstanding at December 31, 2021 and December 31, 2020, respectively | 1 | 1 |
Additional paid-in capital | 1,387,469 | 1,222,818 |
Accumulated other comprehensive income | 47 | |
Accumulated deficit | (1,726,043) | (1,526,617) |
Total shareholders' deficit | (338,573) | (303,751) |
Total liabilities and shareholders' deficit | $ 374,819 | $ 469,057 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred shares, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred shares, shares authorized | 230 | 230 |
Preferred shares, shares issued | 0 | 0 |
Preferred shares, outstanding shares | 0 | 0 |
Ordinary shares, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Ordinary shares, authorized shares | 200,000 | 200,000 |
Ordinary shares, shares issued | 74,435 | 64,328 |
Ordinary shares, outstanding shares | 74,435 | 64,328 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue: | |||
Total revenue | $ 55,311 | $ 71,857 | $ 73,414 |
Expenses: | |||
Research and development (1) | 193,657 | 260,953 | 219,248 |
Selling, general and administrative (1) | 99,296 | 108,661 | 106,081 |
Restructuring and related expenses | 20,142 | ||
Total expenses | 313,095 | 369,614 | 325,329 |
Total share-based compensation expense | 62,061 | 62,976 | 60,450 |
Loss from operations | (257,784) | (297,757) | (251,915) |
Income from investment in TRC, LLC | 103,987 | 68,438 | 33,705 |
Interest expense | (46,889) | (44,585) | (31,862) |
Loss on extinguishment of debt | (15,464) | ||
Interest and other income, net | 1,109 | 2,831 | 8,395 |
Loss before income taxes | (199,577) | (286,537) | (241,677) |
Provision for income tax benefit | 151 | 8,520 | 5,222 |
Net loss | $ (199,426) | $ (278,017) | $ (236,455) |
Net loss per share: | |||
Basic net loss per share | $ (2.87) | $ (4.46) | $ (4.25) |
Diluted net loss per share | $ (2.87) | $ (4.46) | $ (4.25) |
Shares used to compute basic net loss per share | 69,461 | 62,345 | 55,610 |
Shares used to compute diluted net loss per share | 69,461 | 62,345 | 55,610 |
Research and development | |||
Expenses: | |||
Restructuring and related expenses | $ 10,600 | ||
Total share-based compensation expense | 25,634 | $ 31,294 | $ 28,953 |
Selling, general and administrative | |||
Expenses: | |||
Restructuring and related expenses | 9,500 | ||
Total share-based compensation expense | 28,065 | 31,682 | 31,497 |
Restructuring and related expenses | |||
Expenses: | |||
Total share-based compensation expense | 8,362 | ||
Collaborative revenue | |||
Revenue: | |||
Total revenue | 11,463 | 26,464 | 31,250 |
Licensing revenue | |||
Revenue: | |||
Total revenue | 1,500 | 28,500 | |
Viatris collaboration agreement | |||
Revenue: | |||
Total revenue | $ 43,848 | $ 43,893 | $ 13,664 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS | |||
Net loss | $ (199,426) | $ (278,017) | $ (236,455) |
Other comprehensive income (loss): | |||
Net unrealized gain (loss) on available-for-sale investments, net of tax | (47) | (98) | 311 |
Comprehensive loss | $ (199,473) | $ (278,115) | $ (236,144) |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT - USD ($) shares in Thousands, $ in Thousands | Ordinary Shares | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total |
Balances at Dec. 31, 2018 | $ 1 | $ 960,721 | $ (166) | $ (1,012,145) | $ (51,589) |
Balances (in shares) at Dec. 31, 2018 | 55,681 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Proceeds from ESPP purchases | 3,474 | 3,474 | |||
Proceeds from ESPP purchases (in shares) | 203 | ||||
Employee share-based compensation expense | 60,450 | 60,450 | |||
Issuance of restricted shares (in shares) | 1,105 | ||||
Option exercises | 3,142 | 3,142 | |||
Option exercises (in shares) | 164 | ||||
Repurchase of shares to satisfy tax withholding | (3,173) | (3,173) | |||
Repurchase of shares to satisfy tax withholding (in shares) | (138) | ||||
Net unrealized gain (loss) on marketable securities | 311 | 311 | |||
Net loss | (236,455) | (236,455) | |||
Balances at Dec. 31, 2019 | $ 1 | 1,024,614 | 145 | (1,248,600) | (223,840) |
Balances (in shares) at Dec. 31, 2019 | 57,015 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net proceeds from sale of ordinary shares | 139,915 | 139,915 | |||
Net proceeds from sale of ordinary shares (in shares) | 5,500 | ||||
Proceeds from ESPP purchases | 3,701 | 3,701 | |||
Proceeds from ESPP purchases (in shares) | 245 | ||||
Employee share-based compensation expense | 62,976 | 62,976 | |||
Issuance of restricted shares (in shares) | 1,907 | ||||
Option exercises | 1,361 | 1,361 | |||
Option exercises (in shares) | 68 | ||||
Repurchase of shares to satisfy tax withholding | (9,749) | (9,749) | |||
Repurchase of shares to satisfy tax withholding (in shares) | (407) | ||||
Net unrealized gain (loss) on marketable securities | (98) | (98) | |||
Net loss | (278,017) | (278,017) | |||
Balances at Dec. 31, 2020 | $ 1 | 1,222,818 | 47 | (1,526,617) | $ (303,751) |
Balances (in shares) at Dec. 31, 2020 | 64,328 | 64,328 | |||
Increase (Decrease) in Stockholders' Equity | |||||
Net proceeds from sale of ordinary shares | 108,180 | $ 108,180 | |||
Net proceeds from sale of ordinary shares (in shares) | 7,705 | ||||
Proceeds from ESPP purchases | 3,466 | 3,466 | |||
Proceeds from ESPP purchases (in shares) | 275 | ||||
Employee share-based compensation expense | 62,061 | 62,061 | |||
Issuance of restricted shares (in shares) | 2,682 | ||||
Option exercises | 5 | 5 | |||
Repurchase of shares to satisfy tax withholding | (9,061) | (9,061) | |||
Repurchase of shares to satisfy tax withholding (in shares) | (555) | ||||
Net unrealized gain (loss) on marketable securities | $ (47) | (47) | |||
Net loss | (199,426) | (199,426) | |||
Balances at Dec. 31, 2021 | $ 1 | $ 1,387,469 | $ (1,726,043) | $ (338,573) | |
Balances (in shares) at Dec. 31, 2021 | 74,435 | 74,435 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating activities | |||
Net loss | $ (199,426) | $ (278,017) | $ (236,455) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 5,912 | 6,798 | 6,441 |
Amortization and accretion income, net | 10 | (1,079) | (3,451) |
Share-based compensation | 62,061 | 62,976 | 60,450 |
Loss on disposal of property and equipment | 39 | ||
Amortization of right-of-use assets | 3,786 | 3,344 | 3,224 |
Gain from lease modification | (1,863) | ||
Undistributed earnings from TRC, LLC | (44,516) | (37,975) | (23,152) |
Interest shortfall on 2035 notes, net | 5,713 | 17,643 | |
Loss on extinguishment of debt | 15,464 | ||
Other | 10 | (95) | 146 |
Changes in operating assets and liabilities: | |||
Accounts receivable | 620 | ||
Receivables from collaborative and licensing arrangements | 1,803 | 6,128 | (11,943) |
Prepaid clinical and development services | 10,129 | (17,638) | (561) |
Other prepaid and current assets | 2,867 | (2,327) | (73) |
Tax receivable | (258) | (3,700) | |
Other assets | (972) | (852) | (358) |
Accounts payable | (3,534) | 3,658 | (4,274) |
Accrued personnel-related expenses, accrued clinical and development expenses, and other accrued liabilities | (37,225) | 5,983 | 10,626 |
Accrued interest payable | (34) | (1,685) | 2,573 |
Deferred revenue | (11,463) | (26,465) | (31,245) |
Operating lease liabilities | (1,742) | 1,600 | (2,317) |
Other long-term liabilities | 587 | (7,606) | (4,748) |
Net cash used in operating activities | (207,858) | (250,403) | (238,197) |
Investing activities | |||
Purchases of property and equipment | (3,406) | (6,616) | (3,176) |
Purchases of marketable securities | (158,305) | (401,987) | (423,898) |
Maturities of marketable securities | 286,199 | 399,318 | 339,018 |
Proceeds from the sale of marketable securities | 19,942 | ||
Proceeds from the sale of property and equipment | 6 | 64 | 5 |
Proceeds from the sale of VIBATIV business, net | 5,000 | ||
Net cash provided by (used in) investing activities | 124,494 | 10,721 | (83,051) |
Financing activities | |||
Proceeds from the sale of ordinary shares, net | 108,180 | 139,915 | |
Proceeds from issuance of 2035 notes, net | 380,000 | ||
Payment of issuance costs on 2035 notes | (5,326) | ||
Principal payment on 2035 notes | (10,730) | (235,347) | (2,152) |
Payment of redemption premium on 2033 notes | (11,470) | ||
Principal payment on 2033 notes | (10,730) | (235,347) | (2,152) |
Proceeds from ESPP purchases | 3,466 | 3,701 | 3,474 |
Proceeds from option exercises | 5 | 1,361 | 3,142 |
Repurchase of shares to satisfy tax withholding | (9,061) | (9,749) | (3,173) |
Net cash provided by financing activities | 91,860 | 263,085 | 1,291 |
Net increase (decrease) in cash, cash equivalents, and restricted cash | 8,496 | 23,403 | (319,957) |
Cash, cash equivalents, and restricted cash at beginning of period | 82,300 | 58,897 | 378,854 |
Cash, cash equivalents, and restricted cash at end of period | 90,796 | 82,300 | 58,897 |
Supplemental disclosure of cash flow information | |||
Cash paid for interest | 39,029 | 24,024 | 26,178 |
Cash (received) paid for income taxes, net | $ (4,089) | $ 14 | 22 |
Right-of-use assets obtained in exchange for lease obligations (1) | $ 49,847 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Organization and Summary of Significant Accounting Policies | |
Organization and Summary of Significant Accounting Policies | 1. Organization and Summary of Significant Accounting Policies Theravance Biopharma, Inc. (“Theravance Biopharma” or the “Company”) is a biopharmaceutical company primarily focused on the discovery, development and commercialization of respiratory medicines. The Company’s core purpose is to create medicines that make a difference ® Basis of Presentation The Company’s consolidated financial statements as of December 31, 2021 and 2020, and for the year ended December 31, 2021, 2020, and 2019 have been prepared in conformity with United States (“US”) Generally Accepted Accounting Principles ("GAAP"), and the US Securities and Exchange (“SEC”) regulations for annual reporting. Principles of Consolidation The consolidated financial statements include the accounts of Theravance Biopharma and its wholly-owned subsidiaries, all of which are denominated in US dollars. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures in the consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on assumptions believed to be reasonable under the circumstances. Actual results could differ materially from those estimates. Segment Reporting The Company operates in a single segment, which is the discovery (research), development and commercialization of human therapeutics. The Company’s business offerings have similar economics and other characteristics, including the nature of products and manufacturing processes, types of customers, distribution methods and regulatory environment. The Company is comprehensively managed as one business segment by the Company’s Chief Executive Officer and the management team. Revenue from collaborative arrangements, including royalty revenue, are attributed to regions based on the location of the collaboration partner. Revenue from profit sharing-type arrangements is attributed to the geographic market in which the products are sold. Capitalized property and equipment is predominantly located in the US. Cash and Cash Equivalents The Company considers all highly-liquid investments purchased with a maturity of three months or less on the date of purchase to be cash equivalents. Cash equivalents are carried at fair value. Restricted Cash “Note 4. Cash, Cash Equivalents, and Restricted Cash” Investments in Marketable Securities The Company invests in marketable securities, primarily commercial paper, corporate notes, government bonds and government agency bonds. The Company classifies its marketable securities as available-for-sale securities and reports them at fair value in cash and cash equivalents or marketable securities on the consolidated balance sheets with related unrealized gains and losses included as a component of shareholders’ deficit. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included in interest and other income (loss) on the consolidated statements of operations. The cost of securities sold is based on the specific identification method. Realized gains and losses and interest and dividends on securities are included in interest and other income (loss). The Company accounts for credit losses on available-for-sale debt securities in accordance with Accounting Standards Codification (“ASC”), Topic 326, Financial Instruments – Credit Losses In circumstances where the Company intends to sell, or is more likely than not required to sell, the security before it recovers its amortized cost basis, the difference between fair value and amortized cost is recognized as a loss in the consolidated statements of operations, with a corresponding write-down of the security's amortized cost. In circumstances where neither condition exists, the Company then evaluates whether a decline is due to credit-related factors. To determine the portion of a decline in fair value that is credit-related, the Company compares the present value of the expected cash flows of the security discounted at the security's effective interest rate to the amortized cost basis of the security. A credit-related impairment is limited to the difference between fair value and amortized cost and recognized as an allowance for credit loss on the consolidated balance sheets with a corresponding adjustment to net income (loss). Any remaining decline in fair value that is non-credit related is recognized in other comprehensive loss, net of tax. Improvements in expected cash flows due to improvements in credit are recognized through reversal of the credit loss and corresponding reduction in the allowance for credit loss. Fair Value of Financial Instruments The Company defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company’s valuation techniques are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect the Company’s market assumptions. The Company classifies these inputs into the following hierarchy: Level 1 Quoted prices for identical instruments in active markets. Level 2 Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. Level 3 Unobservable inputs and little, if any, market activity for the assets. “Note 6. Debt” Receivables from Collaborative Arrangements For the periods presented, the Company’s receivables from collaborative arrangements relate to amounts due arising from its collaboration (and licensing) agreements. When appropriate, the Company provides for an allowance for credit losses. The Company performs periodic credit evaluations of its customers and generally does not require collateral. For the periods presented, the Company did not have any material write-offs of receivables from collaborative arrangements. Concentration of Credit Risks The Company invests in a variety of financial instruments and, based on its policy, limits the amount of credit exposure with any one issuer, industry or geographic area for investments other than instruments backed by the US federal government. The Company’s receivables primarily relate to amounts due under its collaboration and licensing agreements. Accordingly, the Company may be exposed to credit risk generally associated with pharmaceutical companies or specific to its collaboration agreements. The Company performs periodic evaluations of its customers and generally does not require collateral. For the year ended December 31, 2021, 2020, and 2019, the Company did not experience any material losses related to its receivables. Property and Equipment Property, equipment and leasehold improvements are stated at cost, net of accumulated depreciation, and amortized using the straight-line method as follows: Leasehold improvements Shorter of remaining lease terms or useful life Equipment, furniture and fixtures 5 - 7 years Software and computer equipment 3 - 5 years Leases The Company determines whether a contract is or contains a lease at inception of the arrangement. In evaluating whether a contract is indicative of a lease, the Company considers all relevant facts and circumstances to assess whether the arrangement has extended to the Company the right to both (i) obtain substantially all the economic benefits from use of an identified asset and (ii) direct the use of the identified asset Operating lease assets represent the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent the Company’s obligation to make lease payments arising from the leasing arrangement. The Company records operating leases on the consolidated balance sheets through an operating lease asset and a corresponding short-term and long-term operating lease liability, as applicable. Lease liabilities are measured based on the present value of lease payments over the lease term discounted at the implicit interest rate, when readily available or using the Company’s incremental borrowing rate, if the implicit rate is not determinable. The incremental borrowing rate is considered the rate of interest that the Company would have to pay to borrow, on a collateralized basis over a similar term, an amount equal to the lease payments in a similar economic environment. The Company measures its operating lease assets based on the corresponding operating lease liabilities adjusted for (i) prepayments made to the lessor at or before the commencement date, (ii) any initial direct costs incurred, and (iii) tenant incentives granted under the lease contract. In calculating operating lease assets and liabilities, the Company may elect to combine lease and non-lease components based on the asset type. The Company does not recognize operating lease assets or liabilities for leases that have a lease term of 12 months or less at commencement date, and the lease expense related to these short-term lease arrangements is recognized on a straight-line basis over the term of the lease . Capitalized Software The Company capitalizes certain costs related to direct material and service costs for software obtained for internal use. Upon being placed in service, these costs and other future capitalizable costs related to the internal use software system integration are depreciated over five years. There were no material capitalized software costs recorded for the year ended December 31, 2021 or 2020. Impairment of Long-Lived Assets The Company’s long-lived assets consists of property and equipment, operating lease assets and other assets. The carrying value of long-lived assets is reviewed for impairment whenever events or changes in circumstances indicate that the asset may not be recoverable. An impairment loss is recognized when the total of estimated future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount. There was no impairment of long-lived assets recorded for the year ended December 31, 2021, 2020, or 2019. Revenue Recognition The Company recognizes revenue under ASC Topic 606, Revenue from Contracts with Customers At contract inception, once the contract is determined to be within the scope of ASC 606, the Company identifies the performance obligations in the contract by assessing whether the goods or services promised within each contract are distinct. The Company then recognizes revenue for the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Collaborative Arrangements under ASC 606 The Company enters into collaborative arrangements with partners that fall under the scope of ASC Topic 808, Collaborative Arrangements The terms of the Company’s collaborative arrangements typically include one or more of the following: (i) up-front fees; (ii) milestone payments related to the achievement of development, regulatory, or commercial goals; (iii) royalties on net sales of licensed products; (iv) reimbursements or cost-sharing of research and development expenses; and (v) profit/loss sharing arising from co-promotion arrangements. Each of these payments results in collaboration revenues or an offset against research and development expense. Where a portion of non- refundable up-front fees or other payments received is allocated to continuing performance obligations under the terms of a collaborative arrangement, they are recorded as deferred revenue and recognized as collaboration revenue when (or as) the underlying performance obligation is satisfied. As part of the accounting for these arrangements, the Company must develop estimates and assumptions that require judgment to determine the underlying stand-alone selling price for each performance obligation which determines how the transaction price is allocated among the performance obligations. The estimation of the stand-alone selling price may include such estimates as, forecasted revenues or costs, development timelines, discount rates and probabilities of technical and regulatory success. The Company evaluates each performance obligation to determine if they can be satisfied at a point in time or over time, and it measures the services delivered to the collaborative partner which are periodically reviewed based on the progress of the related program. The effect of any change made to an estimated input component and, therefore revenue or expense recognized, would be recorded as a change in estimate. In addition, variable consideration (e.g., milestone payments) must be evaluated to determine if it is constrained and, therefore, excluded from the transaction price. Up-front Fees: Milestone Payments: Royalties: Reimbursement, cost-sharing and profit-sharing payments: Research and Development Expenses Research and development (“R&D”) expenses are recorded in the period that services are rendered or goods are received. R&D expenses consist of salaries and benefits, laboratory supplies and facility costs, as well as fees paid to third parties that conduct certain R&D activities on behalf of the Company, net of certain external R&D expenses reimbursed under the Company’s collaborative arrangements. As part of the process of preparing its consolidated financial statements, the Company is required to estimate and accrue certain R&D expenses. This process involves the following: • identifying services that have been performed on the Company’s behalf and estimating the level of service performed and the associated cost incurred for the service when the Company has not yet been invoiced or otherwise notified of actual cost; • estimating and accruing expenses in the Company’s consolidated financial statements as of each balance sheet date based on facts and circumstances known to it at the time; and • periodically confirming the accuracy of the Company’s estimates with selected service providers and making adjustments, if necessary. Examples of estimated R&D expenses that the Company accrues include: • fees paid to clinical research organizations (“CROs”) in connection with preclinical and toxicology studies and clinical studies; • fees paid to investigative sites in connection with clinical studies; • fees paid to contract manufacturing organizations (“CMOs”) in connection with the production of product and clinical study materials; and • professional service fees for consulting and related services. The Company bases its expense accruals related to clinical studies on its estimates of the services received and efforts expended pursuant to contracts with multiple research institutions and CROs that conduct and manage clinical studies on the Company’s behalf. The financial terms of these agreements vary from contract to contract and may result in uneven payment flows. Payments under some of these contracts depend on factors, such as the successful enrollment of patients and the completion of clinical study milestones. The Company’s service providers typically invoice it monthly in arrears for services performed. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the Company does not identify costs that it has begun to incur or if it underestimates or overestimates the level of services performed or the costs of these services, the Company’s actual expenses could differ from its estimates. To date, the Company has not experienced significant changes in its estimates of accrued R&D expenses after a reporting period. However, due to the nature of estimates, there is no assurance that the Company will not make changes to its estimates in the future as it becomes aware of additional information about the status or conduct of its clinical studies and other R&D activities. Such changes in estimates will be recognized as R&D expenses in the period that the change in estimate occurs. Advertising Expenses The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses were $9.3 million, $6.3 million and $2.4 million for the year ended December 31, 2021, 2020, and 2019, respectively. Fair Value of Share-Based Compensation Awards The Company issues share-based awards to employees and non-employees, generally in the form of share options and restricted share units (“RSUs”). Share-based compensation expense is calculated based on awards ultimately expected to vest and is reduced for actual forfeitures as they occur. The Company expenses these share-based awards over the requisite service period on a straight-line basis, based on the grant date fair value of the awards. The Company determines the fair value of RSUs using the closing market price of the Company's common shares on the day of grant. The Company uses the Black-Scholes-Merton option pricing model to estimate the fair value of options granted under its equity incentive plans and rights to acquire shares granted under its employee share purchase plan (“ESPP”). The Black-Scholes-Merton option pricing model requires the use of assumptions, including the expected term of the award and the expected share price volatility. The Company uses the “simplified” method as described in Staff Accounting Bulletin No. 107, Share-Based Payment The Company also issues performance share units that settle in the Company's shares. The fair value is determined on the date of the grant using the number of shares expected to be earned and the ending market value of the shares on grant date. The number of shares expected to vest is determined by assessing the probability that the performance criteria will be met and the associated targeted payout level that is forecasted will be achieved. For performance share units, the Company recognizes share-based compensation expense over the requisite service period using the accelerated attribution method when achievement of the performance criteria becomes probable. Debt Instruments Coupon interest on the Company’s debt instruments is accrued using the effective interest rate method over the estimated period the debt will be repaid. Debt issuance costs are capitalized as deferred financing costs and presented as a reduction of the carrying value of the financial liability on the Company’s consolidated balance sheets. Debt issuance costs subsequently are amortized to interest expense over the estimated life of the related debt based on the effective interest method. The Company considers whether there are any embedded features in its debt instruments that require bifurcation and separate accounting as derivative financial instruments pursuant to ASC Topic 815, Derivatives and Hedging Theravance Respiratory Company, LLC (“TRC”) Through the Company’s 85% equity interest in TRC, the Company is entitled to receive an 85% economic interest in any future payments made by Glaxo Group or one of its affiliates (“GSK”) under the strategic alliance agreement and under the portion of the collaboration agreement assigned to TRC (net of TRC expenses paid and the amount of cash, if any, expected to be used by TRC pursuant to the TRC LLC Agreement over the next four fiscal quarters). The primary drug program assigned to TRC is Trelegy The Company analyzed its ownership, contractual and other interests in TRC to determine if TRC is a variable-interest entity (“VIE”), whether the Company has a variable interest in TRC and the nature and extent of that interest. The Company determined that TRC is a VIE. The party with the controlling financial interest, the primary beneficiary, is required to consolidate the entity determined to be a VIE. Therefore, the Company also assessed whether the Company is the primary beneficiary of TRC based on the power to direct its activities that most significantly impact its economic performance and the Company’s obligation to absorb its losses or the right to receive benefits from it that could potentially be significant to TRC. Based on the Company’s assessment, it determined that it is not the primary beneficiary of TRC, and, as a result, the Company does not consolidate TRC in its consolidated financial statements. TRC is recognized in the Company’s consolidated financial statements under the equity method of accounting. Income related to the Company’s equity ownership of TRC is reflected within its consolidated statements of operations and is classified as non-operating income. Amounts due from TRC that we believe will be collected within one year and our equity in the net assets of TRC are reflected on our consolidated balance sheets as a current asset and a non-current asset, respectively. The portion of the Non-Recourse 2035 Notes classified as a current liability, if any, is based on the amount of royalties received, or receivable, as of December 31, 2021, that are expected to be collected from TRC and used to make a principal repayment on the Non-Recourse 2035 Notes within the next twelve months. The determination of the amounts likely to be received from TRC within the next twelve months requires significant judgement due to the significant variability of the amounts paid to the Company, as compared to the royalties due. Consequently, the actual amount paid to the holders of the 2035 Notes within twelve months of the reporting date may differ significantly from that recorded in the consolidated balance sheets. Income Taxes The Company utilizes the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities and are measured using enacted tax rates and laws that are anticipated to be in effect when the differences are expected to reverse. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The Company’s total unrecognized tax benefits of The Company assesses all material positions, including all significant uncertain positions, in all tax years that are still subject to assessment or challenge by relevant taxing authorities. Assessing an uncertain tax position begins with the initial determination of the position’s sustainability and is measured at the largest amount of benefit that is greater than 50% likely to be realized upon ultimate settlement. As of each balance sheet date, unresolved uncertain tax positions must be reassessed, and the Company will determine whether the factors underlying the sustainability assertion have changed and whether the amount of the recognized tax benefit is still appropriate. The recognition and measurement of tax benefits requires significant judgment. The Company has taken certain positions where it believes that its position is greater than 50% likely to be realized upon ultimate settlement and for which no reserve for uncertain tax positions has been recorded. If the Company does not ultimately realize the expected benefit of these positions, it will record additional income tax expenses in future periods. Judgments concerning the recognition and measurement of a tax benefit might change as new information becomes available. Any tax levied or credited by a governmental taxing authority that is not based on the Company’s income is outside the scope of accounting for income taxes. Therefore, the Company records such items as a component of its loss before income taxes. Net Loss per Share Basic net loss per share is computed by dividing net loss by the weighted-average number of shares outstanding, less ordinary shares subject to forfeiture. Diluted net loss per share is computed by dividing net loss by the weighted-average number of shares outstanding, less ordinary shares subject to forfeiture, plus all additional ordinary shares that would have been outstanding, assuming dilutive potential ordinary shares had been issued for other dilutive securities. Year Ended December 31, (In thousands, except per share data) 2021 2020 2019 Numerator: Net loss $ (199,426) $ (278,017) $ (236,455) Denominator: Weighted-average ordinary shares outstanding 69,518 62,808 56,452 Less: weighted-average ordinary shares subject to forfeiture (57) (463) (842) Weighted-average ordinary shares used to compute basic and diluted net loss per share 69,461 62,345 55,610 Basic and diluted net loss per share $ (2.87) $ (4.46) $ (4.25) For the year ended December 31, 2021, 2020, and 2019, diluted and basic net loss per share were identical since potential ordinary shares were excluded from the calculation, as their effect was anti-dilutive. Anti-dilutive Securities The following ordinary equivalent shares were not included in the computation of diluted net loss per share because their effect was anti-dilutive: Year Ended December 31, (In thousands) 2021 2020 2019 Share issuances under equity incentive plans and ESPP 7,469 6,553 6,577 Share issuances upon the conversion of convertible senior notes 6,676 6,676 6,676 Total 14,145 13,229 13,253 In addition, there were 414,000 shares subject to performance-based vesting criteria which have been excluded from the ordinary equivalent shares table above for the year ended December 31, 2019. There were no such shares excluded as of December 31, 2021 and 2020. Comprehensive Loss Comprehensive loss is comprised of net loss and changes in unrealized gains and losses on the Company’s available-for-sale investments. Related Parties % over the volume weighted-average price of Theravance Biopharma’s ordinary shares on June 17, 2020. Robert V. Gunderson, Jr. was a member of the Company’s board of directors until his resignation effective September 11, 2021. The Company has engaged Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP, of which Mr. Gunderson is a partner, as its primary legal counsel. Fees incurred for services provided by Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP were $0.5 million, $0.5 million and $0.4 million for the year ended December 31, 2021, 2020, and 2019, respectively. Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (“FASB”) issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes Income Taxes (i) franchise taxes and other taxes partially based on income; (ii) step-up in tax basis goodwill considered part of a business combination in which the book goodwill was originally recognized or should be considered a separate transaction; (iii) separate financial statements of entities not subject to tax; and (iv) interim recognition of enactment of tax laws or rate changes. ASU 2019-12 became effective for annual reporting periods and interim periods within those years beginning after December 15, 2020. The adoption of ASU 2019-12 did not have a material impact on the Company’s consolidated financial statements and related disclosures. Recently Issued Accounting Pronouncements Not Yet Adopted In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and other Options (Subtopic 470-20) and Derivatives and Hedging: Contracts in Entity’s Own Equity (Subtopic 815-40) simplifies the complexity associated with applying GAAP for certain financial instruments with characteristics of liabilities and equity removing certain accounting models which separate the embedded conversion features from the host contract for convertible instruments. The standard also enhances the consistency of earnings-per-share calculations by requiring that an entity use the if-converted method and that the effect of potential share settlement be included in diluted earnings-per-share calculations. ASU 2020-06 is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2021. The Company evaluated ASU 2020-06 and determined that its adoption will not have a material impact on the Company’s consolidated financial statements and related disclosures. The Company has evaluated other recently issued accounting pronouncements and does not currently believe that any of these pronouncements will have a material impact on its consolidated financial statements and related disclosures. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2021 | |
Revenue | |
Revenue | 2. Revenue Revenues from Collaborative Arrangements The Company recognized revenues from its collaborative arrangements as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Janssen $ 11,425 $ 26,426 $ 31,096 Other 38 38 154 Total collaboration revenue $ 11,463 $ 26,464 $ 31,250 Changes in Deferred Revenue Balances Changes in deferred revenue balances arose as a result of the Company recognizing the following revenue from collaborative arrangements during the periods below: Year Ended December 31, (In thousands) 2021 2020 2019 Collaboration revenue recognized in the period from: Amounts included in deferred revenue at the beginning of the period $ 11,463 $ 26,464 $ 31,245 Performance obligations satisfied in previous period — — — Janssen Biotech In February 2018, the Company entered into a global co-development and commercialization agreement with Janssen Biotech, Inc. (“Janssen”) for izencitinib (formerly known as TD-1473) and related back-up compounds for inflammatory intestinal diseases, including ulcerative colitis and Crohn’s disease (the “Janssen Agreement”). The Company received an upfront payment of $100.0 million. Under the terms of the Janssen Agreement, following the initial Phase 2 development period, including the completion of the Phase 2 Crohn’s study, Janssen had the right to obtain an exclusive license to develop and commercialize izencitinib and certain related back-up compounds by paying the Company $200.0 million. Upon any such election, the Company and Janssen would jointly develop and commercialize izencitinib in inflammatory intestinal diseases and share profits in the US and expenses related to Phase 3 development and registration activities (67% to Janssen; 33% to Theravance Biopharma). The Company would receive royalties on ex-US sales at double-digit tiered percentage royalty rates, and the Company would be eligible to receive additional milestone payments from Janssen. . The Janssen Agreement was considered to be within the scope of Accounting Standards Codification, Topic 808, Collaborative Arrangements For the year ended December 31, 2021, 2020, and 2019, the Company recognized $11.4 million, $26.4 million, and $31.1 million, respectively, as revenue from collaboration arrangements related to the Janssen Agreement, and as of December 31, 2021, all of the revenue related to the $100.0 million upfront payment has been fully recognized as collaboration revenue. Collaboration revenue was recognized for the research and development services based on a measure of the Company’s efforts toward satisfying the performance obligation relative to the total expected efforts or inputs to satisfy the performance obligation (e.g., costs incurred compared to total budget). Consequently, delays in trial activity and/or changes to the total budget would have impacted the timing and amount of revenue recognized in any given reporting period. As a result of the notice from Janssen that the Janssen Agreement would be terminated effective January 16, 2022, the Company has no future performance obligations associated with the remaining collaboration revenue that was recognized in the fourth quarter of 2021. For the year ended December 31, 2021, 2020, and 2019, the Company incurred $18.3 million, $38.5 million, and $39.9 million, respectively, in research and development costs related to the Janssen Agreement. Viatris In January 2015, the Company and Viatris Inc. (formerly, Mylan Ireland Limited) (“Viatris”) established a strategic collaboration (the “Viatris Agreement”) for the development and commercialization of revefenacin, including YUPELRI ® As of December 31, 2021, the Company is eligible to receive from Viatris potential global (ex-China and adjacent territories) The Viatris Agreement is considered to be within the scope of ASC 808 and partially within the scope of ASC 606, as the parties are active participants and exposed to the risks and rewards of the collaborative activity with a unit of account provided to Viatris as a customer. Under the terms of the Viatris Agreement, which included the delivery by the Company of a license to Viatris to develop and commercialize revefenacin in exchange for $15.0 million received in 2015, Viatris was responsible for reimbursement of the Company’s costs related to the registrational program up until the approval of the first new drug application in November 2018, thereafter, R&D expenses are shared. Performing R&D services for reimbursement is considered to be a collaborative activity under the scope of ASC 808. Reimbursable program costs are recognized proportionately with the performance of the underlying services and accounted for as reductions to R&D expense. For this unit of account, the Company did not recognize revenue or analogize to ASC 606 and, as such, the reimbursable program costs are excluded from the transaction price. The Company determined the license to develop and commercialize revefenacin to be a unit of account and a separate performance obligation for which Viatris is a customer with the $15.0 million for the delivery of the license as the transaction price. The future potential milestone amounts for The Company is also entitled to a share of US profits and losses (65% to Viatris; 35% to Theravance Biopharma) received in connection with commercialization of YUPELRI, and the Company is entitled to low double-digit tiered royalties on ex-US net sales. Viatris is the principal in the sales transactions, and as a result, the Company does not reflect the product sales in its consolidated financial statements. Following the US Food and Drug Administration (“FDA”) approval of YUPELRI in November 2018, net amounts payable to or receivable from Viatris each quarter under the profit-sharing structure are disaggregated according to their individual components. In accordance with the applicable accounting guidance, amounts receivable mounts payable to Viatris, if any, in connection with the commercialization of YUPELRI are recorded within the consolidated statements of operations as a collaboration loss within selling, general and administrative expenses. Any reimbursement from Viatris attributed to the 65% cost-sharing of the Company’s R&D expenses is characterized as a reduction of R&D expense, as the Company does not consider performing research and development services for reimbursement to be a part of its ordinary activities. The following YUPELRI-related amounts were recognized within revenue and selling, general and administrative expense Year Ended December 31, (In thousands) 2021 2020 2019 Viatris collaboration agreement - Amounts receivable from Viatris $ 43,848 $ 43,893 $ 13,664 Collaboration loss - Amounts payable to Viatris $ — $ — $ 1,582 share of net sales of YUPELRI for the year ended December 31, 2021, 2020, and 2019 of $56.7 million, $50.0 million, and $19.3 million, respectively, before deducting shared expenses. Reimbursement of R&D Expenses As noted above, under certain collaborative arrangements the Company is entitled to reimbursement of certain R&D expenses. Activities under collaborative arrangements for which the Company is entitled to reimbursement are considered to be collaborative activities under the scope of ASC 808. For these units of account, the Company does not analogize to ASC 606 or recognize revenue. The Company records reimbursement payments received from its collaboration partners as reductions to R&D expense. The following table summarizes the reductions to R&D expenses related to reimbursement payments: Year Ended December 31, (In thousands) 2021 2020 2019 Janssen $ 5,819 $ 8,554 $ 5,129 Viatris 2,072 1,524 460 Total reduction to R&D expense, net $ 7,891 $ 10,078 $ 5,589 Revenue from Licensing Arrangements Viatris In June 2019, the Company announced the expansion of the Viatris Agreement (the “Viatris Amendment”) to grant Viatris exclusive development and commercialization rights to nebulized revefenacin in China and adjacent territories. In exchange, the Company received an upfront payment of $18.5 million (before a required tax withholding) and will be eligible to receive potential development and sales milestones totaling $54.0 million and low double-digit tiered royalties on net sales of nebulized revefenacin, if approved. Of the $54.0 million in potential milestones, $9.0 million is associated with the development of $37.5 million is associated with sales milestones. Viatris is responsible for all aspects of development and commercialization in the partnered regions, including pre- and post-launch activities and product registration and all associated costs. The Viatris Amendment is accounted for under ASC 606 as a separate contract from the original Viatris Agreement that was entered into in January 2015. The Company identified a The future potential milestone amounts for In March 2020, the Company earned a $1.5 million development milestone payment for the acceptance of a clinical trial application associated with the use of YUPELRI monotherapy in China and adjacent territories. Pfizer Under the Pfizer Agreement, Pfizer has an exclusive license to develop, manufacture and commercialize certain compounds for all uses other than gastrointestinal, ophthalmic and respiratory applications. Under the terms of the Pfizer Agreement, the Company received an upfront cash payment of $10.0 million and is eligible to receive up to an additional $240.0 million in development and sales milestone payments from Pfizer. In addition, the Company will be eligible to receive a tiered royalty on worldwide net sales of any potential products under the license at percentage royalty rates ranging from middle single-digits to low double-digits. The future potential milestones payable under the Pfizer Amendment were not included in the transaction price, as they were all determined to be fully constrained following the concepts of ASC 606. As part of the Company’s evaluation of the development milestones constraint, the Company determined that the achievement of such milestones is contingent upon success in future clinical trials and regulatory approvals which are not within its control and uncertain at this stage. The Company expects that the sales-based milestone payments will be recognized when the sales occur or the milestone is achieved. The Company will re-evaluate the transaction price each quarter and as uncertain events are resolved or other changes in circumstances occur. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2021 | |
Segment Information | |
Segment Information | 3. Segment Information The Company operates in a single segment, which is the discovery (research), development and commercialization of human therapeutics. The following table summarizes total revenue by geographic region: Year Ended December 31, (In thousands) 2021 2020 2019 US $ 55,273 $ 70,319 $ 54,760 Europe 38 1,538 18,654 Total revenue $ 55,311 $ 71,857 $ 73,414 The following table summarizes total revenue from each of the Company’s customers or collaboration partners who individually accounted for 10% or more of total revenue (as a percentage of total revenues) during the most recent three years: Year Ended December 31, (% of total revenue) 2021 2020 2019 Viatris 79 % 63 % 44 % Janssen 21 % 37 % 42 % Pfizer — — 14 % |
Cash, Cash Equivalents, and Res
Cash, Cash Equivalents, and Restricted Cash | 12 Months Ended |
Dec. 31, 2021 | |
Cash, Cash Equivalents, and Restricted Cash | |
Cash, Cash Equivalents, and Restricted Cash | 4. Cash, Cash Equivalents, and Restricted Cash The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the current period and comparable prior year period consolidated balance sheets that sum to the total of the same such amounts shown on the consolidated statements of cash flows. December 31, (In thousands) 2021 2020 2019 Cash and cash equivalents $ 89,959 $ 81,467 $ 58,064 Restricted cash 837 833 833 Total cash, cash equivalents, and restricted cash shown on the consolidated statements of cash flows $ 90,796 $ 82,300 $ 58,897 The Company maintains restricted cash for certain lease agreements and letters of credit by which the Company has pledged cash and cash equivalents as collateral. The Company also maintains restricted cash for debt servicing of its 9.5% non-recourse 2035 notes. See “Note 6. Debt” The Company periodically engages in foreign exchange transactions as a part of its operations. For the year ended December 31, 2021 and 2020, the Company recognized net realized and unrealized foreign currency losses of $0.9 million and $0.3 million, respectively. For the year ended December 31, 2019, Company recognized net realized and unrealized foreign currency gains of $0.2 million. These amounts are included in the Company’s consolidated statements of operations within “Interest and other income, net”. |
Investments and Fair Value Meas
Investments and Fair Value Measurements | 12 Months Ended |
Dec. 31, 2021 | |
Investments and Fair Value Measurements | |
Investments and Fair Value Measurements | 5. Investments and Fair Value Measurement s Available-for-Sale Securities The estimated fair value of marketable securities is based on quoted market prices for these or similar investments obtained from a commercial pricing service. The fair market value of marketable securities classified within Level 1 is based on quoted prices for identical instruments in active markets. The fair value of marketable securities classified within Level 2 is based on quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; or model-driven valuations whose inputs are observable or whose significant value drivers are observable. Observable inputs may include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data including market research publications. Available-for-sale securities are summarized below: December 31, 2021 Gross Gross Amortized Unrealized Unrealized Estimated (In thousands) Cost Gains Losses Fair Value US government securities Level 1 $ 29,986 $ — $ (2) $ 29,984 Corporate notes Level 2 5,034 — (2) 5,032 Commercial paper Level 2 48,490 1 (1) 48,490 Marketable securities 83,510 1 (5) 83,506 Money market funds Level 1 50,228 — — 50,228 Total $ 133,738 $ 1 $ (5) $ 133,734 December 31, 2020 Gross Gross Amortized Unrealized Unrealized Estimated (In thousands) Cost Gains Losses Fair Value US government securities Level 1 $ 75,036 $ 34 $ — $ 75,070 US government agency securities Level 2 74,971 18 — 74,989 Corporate notes Level 2 5,046 — (1) 5,045 Commercial paper Level 2 56,374 1 (5) 56,370 Marketable securities 211,427 53 (6) 211,474 Money market funds Level 1 — — — — Total $ 211,427 $ 53 $ (6) $ 211,474 As of December 31, 2021, all of the Company’s available-for-sale securities had contractual maturities within 6 months and the weighted-average maturity of marketable securities was approximately 2 months. There were no transfers between Level 1 and Level 2 during the periods presented, and there have been no material changes to the Company’s valuation techniques during the year ended December 31, 2021 or 2020. Available-for-sale debt securities with unrealized losses are summarized below: December 31, 2021 Less than 12 Months Greater than 12 Months Total Gross Gross Gross Estimated Unrealized Estimated Unrealized Estimated Unrealized (In thousands) Fair Value Losses Fair Value Losses Fair Value Losses US government securities $ 19,991 $ (2) $ — $ — $ 19,991 $ (2) Corporate notes 5,031 (2) — — 5,031 (2) Commercial paper 9,995 (1) — — 9,995 (1) Total $ 35,017 $ (5) $ — $ — $ 35,017 $ (5) December 31, 2020 Less than 12 Months Greater than 12 Months Total Gross Gross Gross Estimated Unrealized Estimated Unrealized Estimated Unrealized (In thousands) Fair Value Losses Fair Value Losses Fair Value Losses Corporate notes $ 5,045 $ (1) $ — $ — $ 5,045 $ (1) Commercial paper 39,375 (5) — — 39,375 (5) Total $ 44,420 $ (6) $ — $ — $ 44,420 $ (6) The Company invests primarily in high credit quality and short-term maturity T credit-related losses to be recognized as of December 31, 2021. As of December 31, 2021, the Company’s accumulated other comprehensive income (loss) on its consolidated balance sheets |
Debt
Debt | 12 Months Ended |
Dec. 31, 2021 | |
Debt | |
Debt | 6. Debt Debt consisted of the following liability components: December 31, (In thousands) 2021 2020 9.5% Non-Recourse 2035 Notes: Principal amount $ 413,291 $ 418,572 Less: (20,665) (20,929) Unamortized debt issuance costs - (3,062) (3,847) Unamortized debt issuance costs - Modified (1,265) (1,589) 388,299 392,207 3.25% Convertible 2023 Notes: Principal amount 230,000 230,000 Unamortized debt issuance costs (1,965) (3,037) 228,035 226,963 Total debt $ 616,334 $ 619,170 Debt interest expense consists of the following components: Year Ended December 31, (In thousands) 2021 2020 2019 Stated coupon interest $ 44,707 $ 42,625 $ 28,811 Amortization of debt issuance costs 2,182 1,960 3,051 Total debt interest expense $ 46,889 $ 44,585 $ 31,862 9.5% Non-Recourse Notes Due 2035 On February 21, 2020, Theravance Biopharma R&D, Inc. (“Theravance R&D”), a wholly-owned subsidiary of the Company, and Triple Royalty Sub II LLC (the “Issuer II” or “Triple II”), a wholly-owned subsidiary of Theravance Biopharma R&D, entered into certain note purchase agreements (“Note Purchase Agreements”) with certain note purchasers (“Note Purchasers”), relating to the private placement by Issuer II of $400.0 million 9.5% Fixed Rate Term Notes due on or before 2035 (the “Non-Recourse 2035 Notes”). Ninety-five percent of the Non-Recourse 2035 Notes were sold to the Note Purchasers pursuant to the Note Purchase Agreements. The remaining 5% of the Non-Recourse 2035 Notes (the “Retained Notes”) were retained by the Company to comply with Regulation RR — Credit Risk Retention (17 C.F.R. Part 246). The Retained Notes are eliminated in the Company’s consolidated financial statements. The Non-Recourse 2035 Notes are secured by all of Issuer II’s right, title and interest as a holder of certain membership interests (the “Issuer II Class C Units”) in TRC. TRC holds the right to receive upward-tiering royalties ranging from 6.5% to 10% on worldwide net sales of TRELEGY, and the Company holds an 85% economic interest in TRC. The Issuer II Class C Units represent 75% of the Company's 85% economic interest, which equates to 63.75% of the economic interests in TRC. The source of principal and interest payments for the Non-Recourse 2035 Notes are the future royalty payments generated from the TRELEGY program, and as a result, the holders of the Non-Recourse 2035 Notes have no recourse against the Company even if the TRELEGY payments are insufficient to cover the principal and interest payments for the Non-Recourse 2035 Notes. Prior to and including the December 5, 2024 payment date, in the event that the distributions received by the Issuer II from TRC in a quarter are less than the interest accrued for that quarter, the principal amount of the Non-Recourse 2035 Notes will increase by the interest shortfall amount for that quarter. While the holders of the Non-Recourse 2035 Notes have no recourse against the Company, the terms of the Non-Recourse 2035 Notes also provide that the Company, at its option, may satisfy the quarterly interest payment obligations by making a capital contribution to the Issuer II. Over the course of 2021, $5.7 million of net interest shortfall was added to and $10.7 million of net principal payments was deducted from the Non-Recourse 2035 Notes. This resulted in a $5.0 million net principal decrease of the Non-Recourse 2035 Notes which represented royalties received in excess of the interest payable through the respective payment dates. As of December 31, 2021, the Non-Recourse 2035 Notes’ issuance-to-date net interest shortfall was $23.4 million and the issuance-to-date net principal paydown was $10.7 million. The Non-Recourse 2035 Notes are not convertible into Company equity and have no security interest in nor rights under any agreement with GSK. The Non-Recourse 2035 Notes may be redeemed by Issuer II on and after February 28, 2022, in whole or in part, at specified redemption premiums. The Non-Recourse 2035 Notes bear an annual interest rate of 9.5%, with interest and principal paid quarterly beginning June 5, 2020. Since the principal and interest payments on the Non-Recourse 2035 Notes are ultimately based on royalties from TRELEGY TRELEGY As of December 31, 2021, the net principal and estimated fair value of the Non-Recourse 2035 Notes were $392.6 million and $373.0 million, respectively. As of December 31, 2020, the net principal and estimated fair value of the Non-Recourse 2035 Notes were $397.6 million and $399.6 million, respectively. The inputs to determine fair value of the Non-Recourse 2035 Notes are categorized as Level 2 inputs. Level 2 inputs include quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. 9.0% Non-Recourse Notes Due 2033 In November 2018, the Company entered into note purchase agreements relating to the private placement of $250.0 million aggregate principal amount of 9.0% non-recourse notes, due on or before 2033 (the “Non-Recourse 2033 Notes”) issued by the Company’s wholly-owned subsidiary, Triple Royalty Sub LLC (the “Issuer”). On February 28, 2020, the Company refinanced the Non-Recourse 2033 Notes by issuing the Non-Recourse 2035 Notes and a portion of those proceeds were used to repay, in full, the remaining outstanding balance of the Company’s Non-Recourse 2033 Notes. Pursuant to the terms of the Non-Recourse 2033 Notes, the Company paid a debt redemption premium of 5% of the outstanding principal as of the refinancing date. The refinancing of the Non-Recourse 2033 Notes involved multiple lenders who were considered members of a loan syndicate. To determine whether the refinancing was to be accounted for as a debt extinguishment or modification, the Company considered whether the lenders involved in the Non-Recourse 2033 Notes and the Non-Recourse 2035 Notes remained the same or changed and whether the change in debt terms was substantial. The debt terms were considered substantially different if the present value of the cash inflows and outflows of the Non-Recourse 2035 Notes, including all principal increases and lender fees on the refinancing date, was at least 10% different from the present value of the remaining cash inflows and outflows of the Non-Recourse 2033 Notes (the “10% Test”). The Company performed the 10% Test for each individual lender participating in the loan syndication by assuming the exercise and non-exercise of the prepayment option. The cash flow assumption generating the smaller change was used as the basis for determining whether the 10% threshold was met. For existing lenders who participated in the Non-Recourse 2035 Notes as part of the new loan syndicate, the refinancing was accounted for as an extinguishment or a modification depending upon whether the change in the cash flows was more or less than 10%, respectively. Amounts due to lenders of the Non-Recourse 2033 Note offering who did not participate in the Non-Recourse 2035 Notes were accounted for as a debt extinguishment. For debt determined to be extinguished, the total unamortized deferred financing costs and the associated redemption premium of $15.5 million were expensed as “Loss on extinguishment of debt” within the consolidated statements of operations for the year ended December 31, 2020. In addition, $0.3 million of new third-party costs were expensed, and $4.4 million of new creditor fees were capitalized as debt discount. For debt determined to be modified, $0.5 million of new creditor fees were expensed, and the related unamortized deferred financing costs of $1.8 million, as of February 28, 2020, will continue to be amortized through the remaining term of the Non-Recourse 2035 Notes. 3.25% Convertible Senior Notes Due 2023 In November 2016, the Company completed an underwritten public offering of $230.0 million of 3.25% convertible senior notes, due 2023 (the "Convertible Senior 2023 Notes") for net proceeds of $222.5 million. The Company incurred $7.5 million in debt issuance costs, which are being amortized to interest expense over the estimated life of the Convertible Senior 2023 Notes. The Convertible Senior 2023 Notes bear an annual interest rate of 3.25%, payable semi-annually in arrears, on November 1 and May 1 of each year. The Convertible Senior 2023 Notes are senior unsecured obligations and rank senior in right of payment to any of the Company’s indebtedness that is expressly subordinated in right of payment to the Convertible Senior 2023 Notes; equal in right of payment to any of the Company’s indebtedness that is not so subordinated; effectively junior in right of payment to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities (including trade payables) of the Company’s subsidiaries. The Convertible Senior 2023 Notes will mature on November 1, 2023, unless earlier redeemed or repurchased by the Company or converted. Holders may convert their Convertible Senior 2023 Notes into ordinary shares at an initial conversion rate of 29.0276 shares for each $1,000 principal amount of Convertible Senior 2023 Notes, which is equivalent to an initial conversion price of approximately $34.45 per share, subject to adjustment, in certain circumstances (including upon the occurrence of a fundamental change), at any time prior to the close of business on the second business day immediately preceding the maturity date. Upon the occurrence of a fundamental change involving the Company, holders of the Convertible Senior 2023 Notes may require the Company to repurchase all or a portion of their Convertible Senior 2023 Notes for cash at a redemption price equal to 100% of the principal amount of the Convertible Senior 2023 Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. In addition, in some circumstances, the conversion rate of the Convertible Senior 2023 Notes will increase with a make whole premium for conversions in connection with certain fundamental changes. The debt issuance costs related to the Convertible Senior 2023 Notes offering were capitalized as deferred financing costs and presented as a reduction of the carrying value of the financial liability on the Company’s consolidated balance sheets at December 31, 2021 and 2020. The estimated fair value of the Convertible Senior 2023 Notes was $220.2 million and $217.9 million at December 31, 2021 and 2020, respectively. The estimated fair value was primarily based upon the underlying price of Theravance Biopharma’s publicly traded shares and other observable inputs as of December 31, 2021 and 2020. The inputs to determine fair value of the Convertible Senior 2023 Notes are categorized as Level 2 inputs. Level 2 inputs include quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2021 | |
Leases | |
Leases | 7. Leases As of December 31, 2021, the Company leased approximately 162,000 square feet of office and laboratory space in two buildings in South San Francisco, California, under a non-cancelable operating lease that ends in May 2030 (“SSF Lease”). The lease includes a tenant improvement allowance that expires in November 2022 and had a remaining balance of $10.2 million and $12.1 million, as of December 31, 2021 and 2020, respectively. The Company’s Irish subsidiary leases approximately 6,100 square feet of office space in Dublin, Ireland under a lease that expires in April 2027 (“Dublin Lease”). In July 2021, the Company terminated approximately 8,000 square feet of original office space in one of the buildings and returned the space to the building’s landlord for their use. The Company determined that the termination would be accounted for as a lease modification under ASC 842, Leases Additionally, in July 2021, the Company entered into a separate agreement under which it subleased approximately 21,000 square feet of its South San Francisco office and laboratory space, effective October 2021. Under the terms of the sublease agreement, the sublease term continues through September 2028, and the parties have no option to extend the sublease. Either the Company or the subtenant may terminate the sublease by giving the other party ten days prior written notice. The Company is entitled to receive an initial monthly base rent of $0.1 million, with annual base rent increases of 3% and the subtenant’s proportionate share of the building’s operating expenses. The Company expects to receive a total of $13.1 million over the sublease term which represents a $3.8 million premium over its proportionate lease payment obligations under the head lease. Under the terms of the head lease, 50% of the sublease premium, equal to $1.9 five years each, and the Dublin Lease contains a lease termination option in April 2024 at the Company’s discretion. The two options to extend the SSF Lease and the option to terminate the Dublin Lease were not recognized in the determination of the Company’s right-of-use assets and lease liabilities below. The Company has evaluated its leases and determined that they were all operating leases. The present values of the remaining lease payments and corresponding right-of-use assets were as follows, and the difference between the right-of-use assets and lease liabilities was primarily due to office-related deferred rent payments that are payable in future periods and tenant improvement reimbursements. (In thousands) Classification December 31, 2021 December 31, 2020 Assets Operating lease assets Operating lease assets $ 39,690 $ 43,260 Liabilities Current: Operating lease liabilities Operating lease liabilities $ 503 $ 9,867 Non-current: Operating lease liabilities Long-term operating lease liabilities 52,681 47,220 Total operating lease liabilities $ 53,184 $ 57,087 Lease expense and sublease income were included within operating expenses in the consolidated statements of operations as follows: Year Ended Year Ended Year Ended (In thousands) Classification December 31, 2021 December 31, 2020 December 31, 2019 Operating lease expense Selling, general and administrative expense $ 6,248 $ 7,974 $ 7,959 Operating lease expense Research and development expense 1,377 758 164 Total operating lease expense (1) $ 7,625 $ 8,732 $ 8,123 Year Ended Year Ended Year Ended (In thousands) Classification December 31, 2021 December 31, 2020 December 31, 2019 Operating sublease income Selling, general and administrative expense $ 466 $ — $ — (1) Excludes short-term leases which were not material and office lease service-related charges. Cash paid for amounts included in the measurement of lease liabilities was as follows: Year Ended Year Ended (In thousands) December 31, 2021 December 31, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 8,971 $ 3,804 As of December 31, 2021, the maturities of the Company’s lease liabilities were as follows: (In thousands) Year ending December 31: 2022 $ 9,390 2023 9,655 2024 9,865 2025 10,133 2026 10,425 Thereafter 36,552 Total operating lease payments $ 86,020 Less: Estimated tenant improvement allowance (10,214) Less: Imputed interest (22,622) Present value of operating lease liabilities $ 53,184 As of December 31, 2021, the undiscounted cash flows to be received related to the Company’s sublease were as follows: (In thousands) Year ending December 31: 2022 $ 1,717 2023 1,768 2024 1,821 2025 1,876 2026 1,932 Thereafter 3,516 Total operating sublease receipts $ 12,630 As of December 31, 2021, the weighted-average remaining lease term was 8.3 years, and the weighted-average discount rate used to determine the lease liabilities was 8.64%. The Company’s discount rate was primarily derived from the 9.0% interest rate on its previously issued Non-Recourse 2033 Notes in November 2018 and did not involve any significant assumptions. |
Theravance Respiratory Company,
Theravance Respiratory Company, LLC | 12 Months Ended |
Dec. 31, 2021 | |
Theravance Respiratory Company, LLC | |
Theravance Respiratory Company, LLC | 8. Theravance Respiratory Company, LLC Through the Company’s 85% equity interest in TRC, the Company is entitled to receive an 85% economic interest in any future payments made by GSK under the strategic alliance agreement and under the portion of the collaboration agreement assigned to TRC (net of TRC expenses paid and the amount of cash, if any, expected to be used by TRC pursuant to the TRC LLC Agreement over the next four fiscal quarters). The primary drug program assigned to TRC is Trelegy In May 2014, the Company entered into the TRC LLC Agreement with Innoviva, Inc. (“Innoviva”) that governs the operation of TRC. Under the TRC LLC Agreement, Innoviva is the manager of TRC, and the business and affairs of TRC are managed exclusively by the manager, including (i) day to day management of the drug programs in accordance with the existing GSK agreements; (ii) preparing an annual operating plan for TRC; and (iii) taking all actions necessary to ensure that the formation, structure and operation of TRC complies with applicable law and partner agreements. The Company is responsible for its proportionate share of TRC’s administrative expenses incurred, and communicated to the Company, by Innoviva. The Company analyzed its ownership, contractual and other interests in TRC to determine if it is a variable-interest entity (“VIE”), whether the Company has a variable interest in TRC and the nature and extent of that interest. The Company determined that TRC is a VIE. The party with the controlling financial interest, the primary beneficiary, is required to consolidate the entity determined to be a VIE. Therefore, the Company also assessed whether it is the primary beneficiary of TRC based on the power to direct TRC’s activities that most significantly impact TRC’s economic performance and its obligation to absorb TRC’s losses or the right to receive benefits from TRC that could potentially be significant to TRC. Based on the Company’s assessment, the Company determined that it is not the primary beneficiary of TRC, and, as a result, the Company does not consolidate TRC in its consolidated financial statements. TRC is recognized in the Company’s consolidated financial statements under the equity method of accounting. For the year ended December 31, 2021, 2020, and 2019, the Company recognized net royalty income of $104.0 million, $68.4 million, and $33.7 million, respectively, in the consolidated statements of operations within “Income from investment in TRC, LLC”. These amounts were recorded net of the Company’s share of TRC’s expenses of $3.4 million, $2.2 million, $2.7 million for the year ended December 31, 2021, 2020, and 2019, respectively. The Company’s share of TRC expenses for 2021, 2020, and 2019 was primarily comprised of TRC legal and related fees associated with the arbitration between Innoviva, as the manager of TRC, and TRC and the Company ( see below for more information regarding the arbitration For the year ended December 31, 2021, the Company received $59.5 million from TRC related to TRELEGY royalties, and as of December 31, 2021, the amounts due from TRC of $43.5 million were recorded as a current asset in the consolidated balance sheets within “Amounts due from TRC, LLC”. The Company has also recorded $67.5 million as a long-term asset within “Equity in net assets of TRC, LLC” in the consolidated balance sheets which represented its share of TRC’s net assets which included funds withheld by TRC for future investments. For the year ended December 31, 2021, the Company recognized a net unrealized loss of $0.3 million associated with the estimated fair market value of certain equity investments previously made by TRC. TRC’s summary financial information, including the portion of equity interest that the Company does not own, was as follows as of or for the year ended December 31: Year Ended December 31, (In thousands) 2021 2020 2019 Current assets $ 93,275 $ 63,027 $ 36,737 Non-current assets 37,695 16,959 — Current liabilities 252 508 3,069 Royalty revenue and gross profit 126,688 73,089 42,790 Revenue from collaborative arrangements for the period ended — 10,000 — Income from continuing operations 122,732 80,477 39,410 Net income $ 121,191 $ 81,662 $ 39,653 SEC Rule 3-09 of Regulation S-X requires that a company include audited financial statements for equity method investees when such investees are individually significant for a company’s fiscal year. For the year ended December 31, 2021, the income from the Company’s investment in TRC was determined to be significant. As a result, TRC’s audited financial statements for the year ended December 31, 2021 were included as Exhibit 10.72 in this Annual Report on Form 10-K. TRC Arbitration The Company initiated an arbitration proceeding in October 2020 against Innoviva and TRC, challenging the authority of Innoviva and TRC to pursue a business plan to use TRELEGY royalties to invest in certain privately-held companies, rather than distribute such funds that would otherwise be available for distribution to the Company under the terms of the TRC LLC Agreement to the Company in a manner that it believes is consistent with the TRC LLC Agreement and its 85% economic interest in TRC. On March 30, 2021, the arbitrator ruled that, the Company had not shown that at the then current levels of investment, Innoviva and TRC had not breached the TRC LLC Agreement as of the date of the arbitration. The arbitrator further ruled that Innoviva and TRC had not breached the implied covenant of good faith and fair dealing; or their fiduciary duties. The arbitrator also ruled that (i) Innoviva is entitled to indemnification from TRC for all legal fees and expenses reasonably incurred in the arbitration and (ii) the Company is entitled to indemnification from TRC for legal fees and costs incurred in defending an action Innoviva brought against it in the Delaware Court of Chancery. The arbitrator noted in the ruling that although the Company failed to show that Innoviva’s investment activities, at the then current levels of investment, have or will have a material and adverse effect on its economic interest in TRC, this does not mean that any future investments or actions will not require the Company’s consent. The arbitrator noted in the ruling that the Company may, in the future, have a consent right over the decision to continue this investment strategy or whether to make a particular investment if, for example, Innoviva develops a track record of poor investments, over allocates royalties to these investment activities, or fails to distribute sufficient investment returns, and such facts cause the strategy or investment to have a material adverse effect on the Company’s economic interest in TRC. Pursuant to the terms of the TRC LLC Agreement, Innoviva is required to deliver to the Company a draft quarterly financial plan 30 days prior to the end of each fiscal quarter covering the next fiscal quarter. While the TRC LLC Agreement provides that Innoviva must consider in good faith any comments the Company provides, an applicable financial plan becomes effective 30 days after the draft plan is provided to the Company. The Company has objected to the proposed investments in private companies presented in draft TRC quarterly financial plans to date. If TRC identifies and consummates investments and incurs associated fees identified in a TRC quarterly plan, even over the Company’s objections, distributions by TRC to its members in subsequent The Company’s objections with regard to a TRC quarterly plan or other actions by TRC could result in additional legal proceedings between the Company, TRC and Innoviva, as was the case when the Company initiated arbitration proceedings against Innoviva and TRC in May 2019 and again in October 2020. Any such legal proceedings could divert the attention of management and cause the Company to incur significant costs, regardless of the outcome, which the Company cannot predict. If such proceedings were pursued, there can be no assurance that they would result in the Company receiving additional distributions from TRC. An adverse result could materially and adversely affect the funds that the Company would otherwise expect to receive from TRC in the future. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2021 | |
Property and Equipment | |
Property and Equipment | 9. Property and equipment are held predominantly in the US and consisted of the following: December 31, (In thousands) 2021 2020 Computer equipment $ 2,341 $ 2,314 Software 2,063 2,076 Furniture and fixtures 3,605 3,812 Laboratory equipment 20,087 29,753 Leasehold improvements 24,053 24,275 Subtotal 52,149 62,230 Less: accumulated depreciation (38,492) (45,808) Property and equipment, net $ 13,657 $ 16,422 For the year ended December 31, 2021, 2020, and 2019, depreciation expense for property and equipment was $3.5 million, $3.3 million, and $3.3 million, respectively. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2021 | |
Share-Based Compensation | |
Share-Based Compensation | 10. Share-Based Compensation Theravance Biopharma Equity Plans The Company has three equity compensation plans — its 2013 Equity Incentive Plan (the “2013 EIP”), its 2013 Employee Share Purchase Plan (the “2013 ESPP”) and its 2014 New Employee Equity Incentive Plan (the “2014 NEEIP”). At inception, the Company was authorized to issue 5,428,571 ordinary shares under the 2013 EIP, 857,142 ordinary shares under the 2013 ESPP, and 750,000 ordinary shares under the 2014 NEEIP. The 2013 EIP provides for the issuance of share-based awards, including restricted shares, restricted share units, options, share appreciation rights (“SARs”) and other equity-based awards, to Company employees, officers, directors and consultants. As of January 1 of each year, commencing on January 1, 2015 and ending on (and including) January 1, 2023, the aggregate number of ordinary shares that may be issued under the 2013 EIP shall automatically increase by a number equal to the least of 5% of the total number of ordinary shares outstanding on December 31 of the prior year, 3,428,571 ordinary shares, or a number of ordinary shares determined by the Company’s board of directors. Options may be granted with an exercise price not less than the fair market value of the ordinary shares on the grant date. Under the terms of the Company’s 2013 EIP, options granted to employees generally have a maximum term of 10 years and vest over a four-year period from the date of grant; 25% vest at the end of one year , and 75% vest monthly over the remaining three years . The Company may grant options with different vesting terms from time to time. Unless an employee’s termination of service is due to disability or death, upon termination of service, any unexercised vested options will generally be forfeited at the end of three months or the expiration of the option, whichever is earlier. Under the 2013 ESPP, the Company’s officers and employees may purchase ordinary shares through payroll deductions at a price equal to 85% of the lower of the fair market value of the ordinary share at the beginning of the offering period or at the end of each applicable purchase period. As of January 1 of each year, commencing on January 1, 2015 and ending on (and including) January 1, 2033, the aggregate number of ordinary shares that may be issued under the 2013 ESPP shall automatically increase by a number equal to the least of 1% of the total number of ordinary shares outstanding on December 31 of the prior year, 571,428 ordinary shares or a number of ordinary shares determined by the Company’s board of directors. The ESPP generally provides for consecutive and overlapping offering periods of 24 months in duration, with each offering period generally composed of four consecutive six-month purchase periods. The purchase periods end on either May 15 or November 15. ESPP contributions are limited to a maximum of 15% of an employee’s eligible compensation. The 2013 ESPP also includes a feature that provides for the existing offering period to terminate and for participants in that offering period to automatically be enrolled in a new offering period when the fair market value of an ordinary share at the beginning of a subsequent offering period falls below the fair market value of an ordinary share on the first day of such offering period. The 2014 NEEIP provides for the issuance of share-based awards, including restricted shares, restricted share units, non-qualified options and SARs, to the Company’s employees. Options may be granted with an exercise price not less than the fair market value of the ordinary shares on the grant date. Under the terms of the 2014 NEEIP, options granted to employees generally have a maximum term of 10 years and vest over a four-year period from the date of grant; 25% vest at the end of one year, and 75% vest monthly over the remaining three years. The Company may grant options with different vesting terms from time to time. Unless an employee’s termination of service is due to disability or death, upon termination of service, any unexercised vested options will generally be forfeited at the end of three months or the expiration of the option, whichever is earlier. Performance-Contingent Awards In 2016, the Compensation Committee of the Company’s board of directors (“Compensation Committee”) approved the grant of 1,575,000 performance-contingent restricted share awards (“RSAs”) and 135,000 performance-contingent restricted share units (“RSUs”) to senior management. The vesting of such awards was dependent on the Company meeting its critical operating goals and objectives during the five-year period from 2016 to December 2020, as well as, continued employment. The awards were broken into three separate tranches, and expenses associated with these awards were recognized during the years 2016 to 2020 as the performance conditions were achieved. As of the first quarter of 2020, the performance conditions associated with all three tranches were achieved. The Company recognized $0.4 million, $3.0 million, and $1.9 million of share-based compensation expense associated with these awards for the year ended December 31, 2021, 2020, and 2019, respectively, and the expenses associated with these awards have been fully recognized as of December 31, 2021. Separate from the performance-contingent awards described above, the Company periodically grants performance-contingent RSUs to employees. For the year ended December 31, 2021, 2020, and 2019, the Company recognized $0.4 million, $1.0 million, and $1.0 million, respectively, of share-based compensation expense related to such awards. As of December 31, 2021, there were 325,000 shares of these performance-contingent RSUs outstanding that have a maximum remaining share-based compensation expense of $2.9 million with performance expiration dates through December 2025. Share-Based Compensation Modifications Due to Corporate Restructuring As a result of the Company’s corporate restructuring announcement in September 2021 (see “Note 14. Corporate Restructuring” Share-Based Compensation Expense Share-based compensation expense included in the consolidated statements of operations was recognized as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Research and development $ 25,634 $ 31,294 $ 28,953 Selling, general and administrative 28,065 31,682 31,497 Restructuring and related expenses 8,362 — — Total share-based compensation expense $ 62,061 $ 62,976 $ 60,450 Share-based compensation expense included in the consolidated statements of operations by award type was as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Innoviva equity: Options $ — $ — $ — RSUs — — — RSAs — — 64 Performance RSAs — — — Theravance Biopharma equity: Options 5,473 6,536 6,381 RSUs 54,931 49,803 39,520 Performance RSAs and RSUs 763 3,943 12,717 ESPP 894 2,694 1,768 Total share-based compensation expense $ 62,061 $ 62,976 $ 60,450 As of December 31, 2021, the unrecognized share-based compensation cost, net of actual forfeitures, and the estimated weighted-average amortization period, using the straight-line attribution method, was as follows: Unrecognized Weighted ‑ Average Compensation Amortization Period (In thousands, except amortization period) Cost (Years) Theravance Biopharma equity: Options $ 4,535 1.98 RSUs 88,220 2.77 Performance RSAs and RSUs (1) 795 2.37 ESPP 1 0.70 Total $ 93,551 (1) Represents unrecognized share-based compensation cost associated with the Company’s performance-contingent awards described above that are probable of vesting. Compensation Awards The following table summarizes option activity under the 2013 EIP and 2014 NEEIP for the year ended December 31, 2021: Number of Shares Weighted-Average Exercise Price of Aggregate Subject to Remaining Contractual Outstanding Options Intrinsic Value Outstanding Options Term (Years) (in dollars) (in thousands) Outstanding at December 31, 2020 3,299,179 $ 24.58 Granted 230,750 18.85 Exercised (275) 16.76 Forfeited (658,086) 22.41 Outstanding at December 31, 2021 2,871,568 4.63 24.62 $ 1,070 Exercisable at December 31, 2021 3.95 867 Vested and expected to vest at December 31, 2021 4.62 1,070 The following table summarizes additional information for options under the 2013 EIP and 2014 NEEIP. 2021 2020 2019 Weighted average fair value of options (in dollars) $ 9.25 $ 11.03 $ 10.20 Total intrinsic value of options exercised (in thousands) $ 1 $ 384 $ 822 The following table summarizes total RSU and RSA activity (including performance RSUs and RSAs) for the year ended December 31, 2021: Number of Shares Number of Shares Subject to Outstanding Subject to Outstanding RSUs Performance Conditions (RSAs) Outstanding at December 31, 2020 4,993,918 414,000 Granted 7,850,175 — Released (2,682,186) (414,000) Forfeited (1,808,058) — Outstanding at December 31, 2021 8,353,849 — The total estimated fair value of RSUs vested was $49.3 million and $52.8 million in 2021 and 2020, respectively. Valuation Assumptions The range of assumptions used to estimate the fair value of options granted and rights granted under the 2013 ESPP was as follows: Year Ended December 31, 2021 2020 2019 Options Risk-free interest rate 0.5% - 1.2% 0.3% - 1.7% 1.6% - 2.5% Expected term (in years) 5.3 - 6.1 5.2 - 6.1 6.0 Volatility 52% - 53% 50% - 53% 51% - 53% Dividend yield — — — Weighted-average estimated fair value $ 9.25 $ 11.03 $ 10.20 2013 ESPP Risk-free interest rate 0.03% - 0.2% 0.1% - 0.2% 1.5% - 2.4% Expected term (in years) 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Volatility 40% - 79% 53% - 76% 40% - 48% Dividend yield — — — Weighted-average estimated fair value $ 3.52 $ 8.04 $ 6.17 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Taxes | |
Income Taxes | 11. Income Taxes Theravance Biopharma was incorporated in the Cayman Islands in July 2013 under the name Theravance Biopharma, Inc. as a wholly-owned subsidiary of Innoviva and began operations subsequent to a spin-off with wholly-owned subsidiaries in the Cayman Islands, US, United Kingdom, and Ireland. Effective July 1, 2015, Theravance Biopharma became an Irish tax resident, therefore, the loss before income taxes of Theravance Biopharma, the parent company, are included in Ireland in the tables below. The components of the loss before income taxes were as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Income (loss) before provision for income taxes: Cayman Islands $ — $ 37,567 $ 11,779 United States (16,568) (46,500) (99,225) Ireland (182,775) (277,105) (154,217) United Kingdom (234) (499) (14) Total $ (199,577) $ (286,537) $ (241,677) The components of provision for income tax benefit were as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Provision for income tax benefit (expense): Current: Cayman Islands $ — $ — $ — United States 173 8,545 5,210 Ireland (8) (13) — United Kingdom (14) (12) 12 Subtotal 151 8,520 5,222 Deferred — — — Total $ 151 $ 8,520 $ 5,222 Effective tax rate 0.08 % 2.97 % 2.16 % The provision for income tax benefit was $0.2 million, $8.5 million, and $5.2 million for the year ended December 31, 2021, 2020, and 2019, respectively. The 2021 and 2020 net income tax benefit was primarily attributed to a reversal of previously accrued contingent tax liabilities for uncertain tax positions due to a lapse of the statute of limitations and their related interest accruals. The 2019 net income tax benefit was primarily due to the reversal of previously accrued contingent tax liabilities for uncertain tax positions due to a lapse of the statute of limitations and current year US research and development credits. As a result of the Company becoming an Irish tax resident effective July 1, 2015, the tax rates reflect the Irish statutory rate of 25%. The differences between the Irish statutory income tax rate and the Company’s effective tax rates were as follows: Year Ended December 31, 2021 2020 2019 Provision at statutory income tax rate 25.00 % 25.00 % 25.00 % Foreign rate differential (10.52) (11.49) (6.96) Share-based compensation (4.14) 0.75 (1.17) Non-deductible executive compensation (1.62) (0.63) (0.51) Uncertain tax positions (5.25) (1.26) (0.63) Research and development tax credit carryforwards 2.38 1.83 2.50 Intangible asset 2.44 10.01 — Change in valuation allowance (7.62) (20.56) (14.90) Other (0.59) (0.68) (1.17) Effective tax rate 0.08 % 2.97 % 2.16 % December 31, (In thousands) 2021 2020 Deferred tax assets: Net operating loss carryforwards $ 115,606 $ 82,821 Capital loss carryforwards 19,409 19,409 Research and development tax credit carryforwards 28,372 24,075 Fixed assets and intangibles 287,177 310,187 Share-based compensation 10,432 15,087 Accruals 3,590 8,145 Operating lease liabilities 11,607 11,662 Other 10,505 346 Subtotal 486,698 471,732 Valuation allowance (477,868) (462,711) Total deferred tax assets 8,830 9,021 Deferred tax liabilities: Operating lease assets (8,575) (8,680) Prepaid assets (254) (341) Total deferred tax liabilities (8,830) (9,021) Net deferred tax assets (liabilities) $ — $ — The Company follows the accounting guidance related to accounting for income taxes which requires that a company reduce its deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of its deferred tax assets will not be realized. As of December 31, 2021, the Company’s deferred tax assets were offset in full by a valuation allowance. The valuation allowance as of December 31, 2021 increased As of December 31, 2021, the Company had $305.0 million of US federal net operating loss carryforwards and $24.7 million of federal research and development tax credit carryforwards which expire beginning in 2035. After the enactment of the Tax Cut and Jobs Act (the “Tax Act”) in December 2017, the operating losses generated had an indefinite carryforward life, but was limited to 80% of taxable income when utilized. As of December 31, 2021, this amount was $260.1 million. The Company had state net operating loss carryforwards of $90.4 million which generally begin to expire in 2034 and state research and development credit carryforwards of $23.4 million to be carried forward indefinitely. The Company also had Irish net operating loss carryforwards of $739.6 million with no expiration date and capital loss carryforwards of $58.8 million to be carried forward indefinitely. Utilization of net operating loss and tax credit carryforwards may be subject to an annual limitation due to ownership change limitations provided by the Internal Revenue Code and similar state provisions. Annual limitations may result in expiration of net operating loss and tax credit carryforwards before some or all of such amounts have been utilized. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. The amount of tax expense related to interest or penalties was not material for the year ended December 31, 2021 and 2020. Uncertain Tax Positions A reconciliation of the beginning and ending balances of the total amounts of unrecognized tax benefits were as follows: (In thousands) Unrecognized tax benefits as of December 31, 2019 $ 58,763 Gross decrease in tax positions for prior years (8,059) Gross increase in tax positions for current year 12,743 Unrecognized tax benefits as of December 31, 2020 63,447 Gross decrease in tax positions for prior years (395) Gross increase in tax positions for current year 11,971 Unrecognized tax benefits as of December 31, 2021 $ 75,023 The Company records liabilities related to uncertain tax positions in accordance with the income tax guidance which clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements by prescribing a minimum recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Resolution of one or more of these uncertain tax positions in any period may have a material impact on the results of operations for that period. The Company includes any applicable interest and penalties within the provision for income taxes in the consolidated statements of operations. The total unrecognized tax benefits of $75.0 million and $63.4 million, as of December 31, 2021 and December 31, 2020, respectively, may reduce the effective tax rate in the period of recognition. However, carryforward tax attributes that were generated in years beginning on or before January 1, 2018 may still be adjusted upon examination by tax authorities since the attributes are not yet utilized. The Company does not expect to record any other material reductions in the measurement of its unrecognized tax benefits within the next twelve months. The Company currently has a full valuation allowance against its deferred tax assets, which would impact the timing of the effective tax rate benefit should any of these uncertain positions be favorably settled in the future. The Company is subject to taxation in Ireland, the US, and various other jurisdictions. The tax years 2018 and forward remain open to examination in Ireland, tax years 2019 and forward remain open to examination in the US, and the tax years 2016 and forward remain open to examination in other jurisdictions. The Company is currently under Internal Revenue Service (“IRS”) examination for the tax year ended December 31, 2018. The Company believes that an adequate provision has been made for any material adjustments that may result from the tax examination. The Company concluded its IRS examination for the tax year ended December 31, 2017 in December 2020 with no adjustments required. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act The Company’s future income tax expense may be affected by such factors as changes in tax laws, its business, regulations, tax rates, interpretation of existing laws or regulations, the impact of accounting for share-based compensation, the impact of accounting for business combinations, its international organization, shifts in the amount of income before tax earned in the US as compared with other regions in the world, and changes in overall levels of income before tax. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies | |
Commitments and Contingencies | 12. Commitments and Contingencies Performance-Contingent Awards In 2016, the Compensation Committee granted long-term incentive cash bonus awards to certain employees. The vesting and payout of such awards was dependent on the Company meeting its critical operating goals and objectives during a five-year period from 2016 to December 2020, as well as continued employment. The awards were broken into three separate tranches, and expenses associated with these awards were recognized during the years 2016 to 2021 as the performance conditions were achieved. The performance conditions associated with the first tranche of the cash bonus awards were completed in the second quarter of 2018, the performance conditions associated with the second tranche were completed in the first quarter of 2019, and the performance conditions associated with the third tranche were completed in the first quarter of 2020. The Company recognized $0.4 million, $3.3 million, and $14.2 million of cash bonus expense for the year ended December 31, 2021, 2020, and 2019, respectively, and the expenses associated with these awards have been fully recognized as of December 31, 2021. Guarantees and Indemnifications The Company indemnifies its officers and directors for certain events or occurrences, subject to certain limits. The Company maintains insurance policies that may limit its exposure, and therefore, o assurances can be given regarding the amounts that may ultimately be covered by the insurers, and the Company may incur substantial liabilities because of these indemnification obligations. |
Public Offering of Ordinary Sha
Public Offering of Ordinary Shares | 12 Months Ended |
Dec. 31, 2021 | |
Public Offering of Ordinary Shares | |
Public Offering of Ordinary Shares | 13. Public Offering of Ordinary Shares Under the terms of the underwriting agreement, on June 29, 2021, the underwriters also exercised a 30-day option to purchase an additional 1,005,000 ordinary shares for a total of 7,705,000 ordinary shares sold. |
Corporate Restructuring
Corporate Restructuring | 12 Months Ended |
Dec. 31, 2021 | |
Corporate Restructuring | |
Corporate Restructuring | 14. Corporate Restructuring Following unfavorable clinical results related to the Company’s late-stage development programs, on September 15, 2021, the Company announced a strategic update and corporate restructuring (the “Restructuring”) to focus on leveraging its expertise in developing and commercializing respiratory therapeutics. As part of the Restructuring, the Company initiated a reduction in workforce of approximately 75%, an estimated 270 positions. Approximately 75% of the total reduction in workforce was completed at the end of November 2021, and the remainder will be completed by the end of February 2022. The Company estimates that it will incur total Restructuring and related expenses of approximately $32.0 million comprised of $17.0 million in cash expenses and $15.0 million in non-cash expenses. These expenses are primarily comprised of severance and other related costs which are being For the year ended December 31, 2021, the Company incurred Restructuring and related expenses of $20.1 million of which Selected information relating to accrued cash-related Restructuring expenses was as follows: (In thousands) Balance at December 31, 2020 $ — Net accruals 11,867 Cash paid (2,317) Balance at December 31, 2021 $ 9,550 The Company expects to recognize the majority of the remaining Restructuring and related expenses of approximately $12.0 million, comprised of $5.0 million in cash-related expenses and $7.0 million in non-cash expenses, in the first quarter of 2022 and the balance by the third quarter of 2022. The remaining Restructuring and related expense estimates are subject to a number of assumptions, and actual amounts may differ. The Company may also incur additional costs not currently contemplated due to events that may occur as a result of, or that are associated with, the Restructuring. The Company also completed an evaluation of the impact of the Restructuring on the carrying value of its long-lived assets, such as property and equipment and operating lease assets. This process includes evaluating the estimated remaining lives, significant changes in the use, and potential impairment charges related to its long-lived assets. Based on its evaluation, the Company determined that its long-lived assets were not impaired as of December 31, 2021, and it did not recognize any impairment charges related to its long-lived assets for the year ended December 31, 2021. The Company may incur additional costs not currently contemplated due to events that may occur because of, or that are associated with, the Restructuring. |
SUPPLEMENTARY FINANCIAL DATA (U
SUPPLEMENTARY FINANCIAL DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2021 | |
SUPPLEMENTARY FINANCIAL DATA (UNAUDITED) | |
SUPPLEMENTARY FINANCIAL DATA (UNAUDITED) | SUPPLEMENTARY FINANCIAL DATA (UNAUDITED) (In thousands, except per share data) The following table presents certain unaudited consolidated quarterly financial information for the eight quarters in the periods ended December 31, 2021 and 2020. This information has been prepared on the same basis as the audited consolidated financial statements and includes all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the unaudited quarterly results of operations set forth herein. For the Quarter Ended March 31, June 30, September 30, December 31, 2021 Total revenue $ 14,257 $ 12,914 $ 13,194 $ 14,946 Costs and expenses 98,149 77,024 66,809 71,113 Loss from operations (83,892) (64,110) (53,615) (56,167) Net loss (79,679) (52,405) (35,308) (32,034) Basic and diluted net loss per share $ (1.24) $ (0.80) $ (0.48) $ (0.43) 2020 Total revenue $ 19,862 $ 15,008 $ 18,257 $ 18,730 Costs and expenses 92,338 87,184 94,872 95,220 Loss from operations (72,476) (72,176) (76,615) (76,490) Net loss (83,053) (62,887) (73,643) (58,434) Basic and diluted net loss per share $ (1.40) $ (1.00) $ (1.16) $ (0.92) Share of Total YUPELRI Net Sales (1) For the Quarter Ended March 31, June 30, September 30, December 31, 2021 $ 12,908 $ 14,621 $ 13,806 $ 15,344 2020 $ 12,880 $ 10,589 $ 12,960 $ 13,550 (1) The Company co-promotes YUPELRI in the US under a profit and loss sharing arrangement with Viatris (65% to Viatris; 35% to Theravance Biopharma). The amounts represent the Company’s implied 35% share of the total net sales of YUPELRI that were recognized within Viatris’ financial statements for the periods presented. |
Organization and Summary of S_2
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Organization and Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The Company’s consolidated financial statements as of December 31, 2021 and 2020, and for the year ended December 31, 2021, 2020, and 2019 have been prepared in conformity with United States (“US”) Generally Accepted Accounting Principles ("GAAP"), and the US Securities and Exchange (“SEC”) regulations for annual reporting. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Theravance Biopharma and its wholly-owned subsidiaries, all of which are denominated in US dollars. All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures in the consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on assumptions believed to be reasonable under the circumstances. Actual results could differ materially from those estimates. |
Segment Reporting | Segment Reporting The Company operates in a single segment, which is the discovery (research), development and commercialization of human therapeutics. The Company’s business offerings have similar economics and other characteristics, including the nature of products and manufacturing processes, types of customers, distribution methods and regulatory environment. The Company is comprehensively managed as one business segment by the Company’s Chief Executive Officer and the management team. Revenue from collaborative arrangements, including royalty revenue, are attributed to regions based on the location of the collaboration partner. Revenue from profit sharing-type arrangements is attributed to the geographic market in which the products are sold. Capitalized property and equipment is predominantly located in the US. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly-liquid investments purchased with a maturity of three months or less on the date of purchase to be cash equivalents. Cash equivalents are carried at fair value. |
Restricted Cash | Restricted Cash “Note 4. Cash, Cash Equivalents, and Restricted Cash” |
Investments in Marketable Securities | Investments in Marketable Securities The Company invests in marketable securities, primarily commercial paper, corporate notes, government bonds and government agency bonds. The Company classifies its marketable securities as available-for-sale securities and reports them at fair value in cash and cash equivalents or marketable securities on the consolidated balance sheets with related unrealized gains and losses included as a component of shareholders’ deficit. The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included in interest and other income (loss) on the consolidated statements of operations. The cost of securities sold is based on the specific identification method. Realized gains and losses and interest and dividends on securities are included in interest and other income (loss). The Company accounts for credit losses on available-for-sale debt securities in accordance with Accounting Standards Codification (“ASC”), Topic 326, Financial Instruments – Credit Losses In circumstances where the Company intends to sell, or is more likely than not required to sell, the security before it recovers its amortized cost basis, the difference between fair value and amortized cost is recognized as a loss in the consolidated statements of operations, with a corresponding write-down of the security's amortized cost. In circumstances where neither condition exists, the Company then evaluates whether a decline is due to credit-related factors. To determine the portion of a decline in fair value that is credit-related, the Company compares the present value of the expected cash flows of the security discounted at the security's effective interest rate to the amortized cost basis of the security. A credit-related impairment is limited to the difference between fair value and amortized cost and recognized as an allowance for credit loss on the consolidated balance sheets with a corresponding adjustment to net income (loss). Any remaining decline in fair value that is non-credit related is recognized in other comprehensive loss, net of tax. Improvements in expected cash flows due to improvements in credit are recognized through reversal of the credit loss and corresponding reduction in the allowance for credit loss. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company’s valuation techniques are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect the Company’s market assumptions. The Company classifies these inputs into the following hierarchy: Level 1 Quoted prices for identical instruments in active markets. Level 2 Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. Level 3 Unobservable inputs and little, if any, market activity for the assets. “Note 6. Debt” |
Receivables from Collaborative Arrangements | Receivables from Collaborative Arrangements For the periods presented, the Company’s receivables from collaborative arrangements relate to amounts due arising from its collaboration (and licensing) agreements. When appropriate, the Company provides for an allowance for credit losses. The Company performs periodic credit evaluations of its customers and generally does not require collateral. For the periods presented, the Company did not have any material write-offs of receivables from collaborative arrangements. |
Concentration of Credit Risks | Concentration of Credit Risks The Company invests in a variety of financial instruments and, based on its policy, limits the amount of credit exposure with any one issuer, industry or geographic area for investments other than instruments backed by the US federal government. The Company’s receivables primarily relate to amounts due under its collaboration and licensing agreements. Accordingly, the Company may be exposed to credit risk generally associated with pharmaceutical companies or specific to its collaboration agreements. The Company performs periodic evaluations of its customers and generally does not require collateral. For the year ended December 31, 2021, 2020, and 2019, the Company did not experience any material losses related to its receivables. |
Property and Equipment | Property and Equipment Property, equipment and leasehold improvements are stated at cost, net of accumulated depreciation, and amortized using the straight-line method as follows: Leasehold improvements Shorter of remaining lease terms or useful life Equipment, furniture and fixtures 5 - 7 years Software and computer equipment 3 - 5 years |
Leases | Leases The Company determines whether a contract is or contains a lease at inception of the arrangement. In evaluating whether a contract is indicative of a lease, the Company considers all relevant facts and circumstances to assess whether the arrangement has extended to the Company the right to both (i) obtain substantially all the economic benefits from use of an identified asset and (ii) direct the use of the identified asset Operating lease assets represent the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent the Company’s obligation to make lease payments arising from the leasing arrangement. The Company records operating leases on the consolidated balance sheets through an operating lease asset and a corresponding short-term and long-term operating lease liability, as applicable. Lease liabilities are measured based on the present value of lease payments over the lease term discounted at the implicit interest rate, when readily available or using the Company’s incremental borrowing rate, if the implicit rate is not determinable. The incremental borrowing rate is considered the rate of interest that the Company would have to pay to borrow, on a collateralized basis over a similar term, an amount equal to the lease payments in a similar economic environment. The Company measures its operating lease assets based on the corresponding operating lease liabilities adjusted for (i) prepayments made to the lessor at or before the commencement date, (ii) any initial direct costs incurred, and (iii) tenant incentives granted under the lease contract. In calculating operating lease assets and liabilities, the Company may elect to combine lease and non-lease components based on the asset type. The Company does not recognize operating lease assets or liabilities for leases that have a lease term of 12 months or less at commencement date, and the lease expense related to these short-term lease arrangements is recognized on a straight-line basis over the term of the lease . |
Capitalized Software | Capitalized Software The Company capitalizes certain costs related to direct material and service costs for software obtained for internal use. Upon being placed in service, these costs and other future capitalizable costs related to the internal use software system integration are depreciated over five years. There were no material capitalized software costs recorded for the year ended December 31, 2021 or 2020. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company’s long-lived assets consists of property and equipment, operating lease assets and other assets. The carrying value of long-lived assets is reviewed for impairment whenever events or changes in circumstances indicate that the asset may not be recoverable. An impairment loss is recognized when the total of estimated future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount. There was no impairment of long-lived assets recorded for the year ended December 31, 2021, 2020, or 2019. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue under ASC Topic 606, Revenue from Contracts with Customers At contract inception, once the contract is determined to be within the scope of ASC 606, the Company identifies the performance obligations in the contract by assessing whether the goods or services promised within each contract are distinct. The Company then recognizes revenue for the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Collaborative Arrangements under ASC 606 The Company enters into collaborative arrangements with partners that fall under the scope of ASC Topic 808, Collaborative Arrangements The terms of the Company’s collaborative arrangements typically include one or more of the following: (i) up-front fees; (ii) milestone payments related to the achievement of development, regulatory, or commercial goals; (iii) royalties on net sales of licensed products; (iv) reimbursements or cost-sharing of research and development expenses; and (v) profit/loss sharing arising from co-promotion arrangements. Each of these payments results in collaboration revenues or an offset against research and development expense. Where a portion of non- refundable up-front fees or other payments received is allocated to continuing performance obligations under the terms of a collaborative arrangement, they are recorded as deferred revenue and recognized as collaboration revenue when (or as) the underlying performance obligation is satisfied. As part of the accounting for these arrangements, the Company must develop estimates and assumptions that require judgment to determine the underlying stand-alone selling price for each performance obligation which determines how the transaction price is allocated among the performance obligations. The estimation of the stand-alone selling price may include such estimates as, forecasted revenues or costs, development timelines, discount rates and probabilities of technical and regulatory success. The Company evaluates each performance obligation to determine if they can be satisfied at a point in time or over time, and it measures the services delivered to the collaborative partner which are periodically reviewed based on the progress of the related program. The effect of any change made to an estimated input component and, therefore revenue or expense recognized, would be recorded as a change in estimate. In addition, variable consideration (e.g., milestone payments) must be evaluated to determine if it is constrained and, therefore, excluded from the transaction price. Up-front Fees: Milestone Payments: Royalties: Reimbursement, cost-sharing and profit-sharing payments: |
Research and Development Expenses | Research and Development Expenses Research and development (“R&D”) expenses are recorded in the period that services are rendered or goods are received. R&D expenses consist of salaries and benefits, laboratory supplies and facility costs, as well as fees paid to third parties that conduct certain R&D activities on behalf of the Company, net of certain external R&D expenses reimbursed under the Company’s collaborative arrangements. As part of the process of preparing its consolidated financial statements, the Company is required to estimate and accrue certain R&D expenses. This process involves the following: • identifying services that have been performed on the Company’s behalf and estimating the level of service performed and the associated cost incurred for the service when the Company has not yet been invoiced or otherwise notified of actual cost; • estimating and accruing expenses in the Company’s consolidated financial statements as of each balance sheet date based on facts and circumstances known to it at the time; and • periodically confirming the accuracy of the Company’s estimates with selected service providers and making adjustments, if necessary. Examples of estimated R&D expenses that the Company accrues include: • fees paid to clinical research organizations (“CROs”) in connection with preclinical and toxicology studies and clinical studies; • fees paid to investigative sites in connection with clinical studies; • fees paid to contract manufacturing organizations (“CMOs”) in connection with the production of product and clinical study materials; and • professional service fees for consulting and related services. The Company bases its expense accruals related to clinical studies on its estimates of the services received and efforts expended pursuant to contracts with multiple research institutions and CROs that conduct and manage clinical studies on the Company’s behalf. The financial terms of these agreements vary from contract to contract and may result in uneven payment flows. Payments under some of these contracts depend on factors, such as the successful enrollment of patients and the completion of clinical study milestones. The Company’s service providers typically invoice it monthly in arrears for services performed. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the Company does not identify costs that it has begun to incur or if it underestimates or overestimates the level of services performed or the costs of these services, the Company’s actual expenses could differ from its estimates. To date, the Company has not experienced significant changes in its estimates of accrued R&D expenses after a reporting period. However, due to the nature of estimates, there is no assurance that the Company will not make changes to its estimates in the future as it becomes aware of additional information about the status or conduct of its clinical studies and other R&D activities. Such changes in estimates will be recognized as R&D expenses in the period that the change in estimate occurs. |
Advertising Expenses | Advertising Expenses The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses were $9.3 million, $6.3 million and $2.4 million for the year ended December 31, 2021, 2020, and 2019, respectively. |
Fair Value of Share-Based Compensation Awards | Fair Value of Share-Based Compensation Awards The Company issues share-based awards to employees and non-employees, generally in the form of share options and restricted share units (“RSUs”). Share-based compensation expense is calculated based on awards ultimately expected to vest and is reduced for actual forfeitures as they occur. The Company expenses these share-based awards over the requisite service period on a straight-line basis, based on the grant date fair value of the awards. The Company determines the fair value of RSUs using the closing market price of the Company's common shares on the day of grant. The Company uses the Black-Scholes-Merton option pricing model to estimate the fair value of options granted under its equity incentive plans and rights to acquire shares granted under its employee share purchase plan (“ESPP”). The Black-Scholes-Merton option pricing model requires the use of assumptions, including the expected term of the award and the expected share price volatility. The Company uses the “simplified” method as described in Staff Accounting Bulletin No. 107, Share-Based Payment The Company also issues performance share units that settle in the Company's shares. The fair value is determined on the date of the grant using the number of shares expected to be earned and the ending market value of the shares on grant date. The number of shares expected to vest is determined by assessing the probability that the performance criteria will be met and the associated targeted payout level that is forecasted will be achieved. For performance share units, the Company recognizes share-based compensation expense over the requisite service period using the accelerated attribution method when achievement of the performance criteria becomes probable. |
Debt Instruments | Debt Instruments Coupon interest on the Company’s debt instruments is accrued using the effective interest rate method over the estimated period the debt will be repaid. Debt issuance costs are capitalized as deferred financing costs and presented as a reduction of the carrying value of the financial liability on the Company’s consolidated balance sheets. Debt issuance costs subsequently are amortized to interest expense over the estimated life of the related debt based on the effective interest method. The Company considers whether there are any embedded features in its debt instruments that require bifurcation and separate accounting as derivative financial instruments pursuant to ASC Topic 815, Derivatives and Hedging |
Theravance Respiratory Company, LLC ("TRC") | Theravance Respiratory Company, LLC (“TRC”) Through the Company’s 85% equity interest in TRC, the Company is entitled to receive an 85% economic interest in any future payments made by Glaxo Group or one of its affiliates (“GSK”) under the strategic alliance agreement and under the portion of the collaboration agreement assigned to TRC (net of TRC expenses paid and the amount of cash, if any, expected to be used by TRC pursuant to the TRC LLC Agreement over the next four fiscal quarters). The primary drug program assigned to TRC is Trelegy The Company analyzed its ownership, contractual and other interests in TRC to determine if TRC is a variable-interest entity (“VIE”), whether the Company has a variable interest in TRC and the nature and extent of that interest. The Company determined that TRC is a VIE. The party with the controlling financial interest, the primary beneficiary, is required to consolidate the entity determined to be a VIE. Therefore, the Company also assessed whether the Company is the primary beneficiary of TRC based on the power to direct its activities that most significantly impact its economic performance and the Company’s obligation to absorb its losses or the right to receive benefits from it that could potentially be significant to TRC. Based on the Company’s assessment, it determined that it is not the primary beneficiary of TRC, and, as a result, the Company does not consolidate TRC in its consolidated financial statements. TRC is recognized in the Company’s consolidated financial statements under the equity method of accounting. Income related to the Company’s equity ownership of TRC is reflected within its consolidated statements of operations and is classified as non-operating income. Amounts due from TRC that we believe will be collected within one year and our equity in the net assets of TRC are reflected on our consolidated balance sheets as a current asset and a non-current asset, respectively. The portion of the Non-Recourse 2035 Notes classified as a current liability, if any, is based on the amount of royalties received, or receivable, as of December 31, 2021, that are expected to be collected from TRC and used to make a principal repayment on the Non-Recourse 2035 Notes within the next twelve months. The determination of the amounts likely to be received from TRC within the next twelve months requires significant judgement due to the significant variability of the amounts paid to the Company, as compared to the royalties due. Consequently, the actual amount paid to the holders of the 2035 Notes within twelve months of the reporting date may differ significantly from that recorded in the consolidated balance sheets. |
Income Taxes | Income Taxes The Company utilizes the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities and are measured using enacted tax rates and laws that are anticipated to be in effect when the differences are expected to reverse. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The Company’s total unrecognized tax benefits of The Company assesses all material positions, including all significant uncertain positions, in all tax years that are still subject to assessment or challenge by relevant taxing authorities. Assessing an uncertain tax position begins with the initial determination of the position’s sustainability and is measured at the largest amount of benefit that is greater than 50% likely to be realized upon ultimate settlement. As of each balance sheet date, unresolved uncertain tax positions must be reassessed, and the Company will determine whether the factors underlying the sustainability assertion have changed and whether the amount of the recognized tax benefit is still appropriate. The recognition and measurement of tax benefits requires significant judgment. The Company has taken certain positions where it believes that its position is greater than 50% likely to be realized upon ultimate settlement and for which no reserve for uncertain tax positions has been recorded. If the Company does not ultimately realize the expected benefit of these positions, it will record additional income tax expenses in future periods. Judgments concerning the recognition and measurement of a tax benefit might change as new information becomes available. Any tax levied or credited by a governmental taxing authority that is not based on the Company’s income is outside the scope of accounting for income taxes. Therefore, the Company records such items as a component of its loss before income taxes. |
Net Loss per Share | Net Loss per Share Basic net loss per share is computed by dividing net loss by the weighted-average number of shares outstanding, less ordinary shares subject to forfeiture. Diluted net loss per share is computed by dividing net loss by the weighted-average number of shares outstanding, less ordinary shares subject to forfeiture, plus all additional ordinary shares that would have been outstanding, assuming dilutive potential ordinary shares had been issued for other dilutive securities. Year Ended December 31, (In thousands, except per share data) 2021 2020 2019 Numerator: Net loss $ (199,426) $ (278,017) $ (236,455) Denominator: Weighted-average ordinary shares outstanding 69,518 62,808 56,452 Less: weighted-average ordinary shares subject to forfeiture (57) (463) (842) Weighted-average ordinary shares used to compute basic and diluted net loss per share 69,461 62,345 55,610 Basic and diluted net loss per share $ (2.87) $ (4.46) $ (4.25) For the year ended December 31, 2021, 2020, and 2019, diluted and basic net loss per share were identical since potential ordinary shares were excluded from the calculation, as their effect was anti-dilutive. Anti-dilutive Securities The following ordinary equivalent shares were not included in the computation of diluted net loss per share because their effect was anti-dilutive: Year Ended December 31, (In thousands) 2021 2020 2019 Share issuances under equity incentive plans and ESPP 7,469 6,553 6,577 Share issuances upon the conversion of convertible senior notes 6,676 6,676 6,676 Total 14,145 13,229 13,253 In addition, there were 414,000 shares subject to performance-based vesting criteria which have been excluded from the ordinary equivalent shares table above for the year ended December 31, 2019. There were no such shares excluded as of December 31, 2021 and 2020. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss is comprised of net loss and changes in unrealized gains and losses on the Company’s available-for-sale investments. |
Related Parties | Related Parties % over the volume weighted-average price of Theravance Biopharma’s ordinary shares on June 17, 2020. Robert V. Gunderson, Jr. was a member of the Company’s board of directors until his resignation effective September 11, 2021. The Company has engaged Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP, of which Mr. Gunderson is a partner, as its primary legal counsel. Fees incurred for services provided by Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP were $0.5 million, $0.5 million and $0.4 million for the year ended December 31, 2021, 2020, and 2019, respectively. |
Recently Adopted Accounting Pronouncements and Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (“FASB”) issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes Income Taxes (i) franchise taxes and other taxes partially based on income; (ii) step-up in tax basis goodwill considered part of a business combination in which the book goodwill was originally recognized or should be considered a separate transaction; (iii) separate financial statements of entities not subject to tax; and (iv) interim recognition of enactment of tax laws or rate changes. ASU 2019-12 became effective for annual reporting periods and interim periods within those years beginning after December 15, 2020. The adoption of ASU 2019-12 did not have a material impact on the Company’s consolidated financial statements and related disclosures. Recently Issued Accounting Pronouncements Not Yet Adopted In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and other Options (Subtopic 470-20) and Derivatives and Hedging: Contracts in Entity’s Own Equity (Subtopic 815-40) simplifies the complexity associated with applying GAAP for certain financial instruments with characteristics of liabilities and equity removing certain accounting models which separate the embedded conversion features from the host contract for convertible instruments. The standard also enhances the consistency of earnings-per-share calculations by requiring that an entity use the if-converted method and that the effect of potential share settlement be included in diluted earnings-per-share calculations. ASU 2020-06 is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2021. The Company evaluated ASU 2020-06 and determined that its adoption will not have a material impact on the Company’s consolidated financial statements and related disclosures. The Company has evaluated other recently issued accounting pronouncements and does not currently believe that any of these pronouncements will have a material impact on its consolidated financial statements and related disclosures. |
Organization and Summary of S_3
Organization and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Organization and Summary of Significant Accounting Policies | |
Schedule of property and equipment useful lives | Leasehold improvements Shorter of remaining lease terms or useful life Equipment, furniture and fixtures 5 - 7 years Software and computer equipment 3 - 5 years |
Schedule of basic and diluted net loss per share | Year Ended December 31, (In thousands, except per share data) 2021 2020 2019 Numerator: Net loss $ (199,426) $ (278,017) $ (236,455) Denominator: Weighted-average ordinary shares outstanding 69,518 62,808 56,452 Less: weighted-average ordinary shares subject to forfeiture (57) (463) (842) Weighted-average ordinary shares used to compute basic and diluted net loss per share 69,461 62,345 55,610 Basic and diluted net loss per share $ (2.87) $ (4.46) $ (4.25) |
Schedule of anti-dilutive securities | Year Ended December 31, (In thousands) 2021 2020 2019 Share issuances under equity incentive plans and ESPP 7,469 6,553 6,577 Share issuances upon the conversion of convertible senior notes 6,676 6,676 6,676 Total 14,145 13,229 13,253 |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Revenue | |
Schedule of revenue recognized from collaborative arrangements | Year Ended December 31, (In thousands) 2021 2020 2019 Janssen $ 11,425 $ 26,426 $ 31,096 Other 38 38 154 Total collaboration revenue $ 11,463 $ 26,464 $ 31,250 |
Summary of changes in deferred revenue | Year Ended December 31, (In thousands) 2021 2020 2019 Collaboration revenue recognized in the period from: Amounts included in deferred revenue at the beginning of the period $ 11,463 $ 26,464 $ 31,245 Performance obligations satisfied in previous period — — — |
Summary of profit sharing revenue and collaboration loss | Year Ended December 31, (In thousands) 2021 2020 2019 Viatris collaboration agreement - Amounts receivable from Viatris $ 43,848 $ 43,893 $ 13,664 Collaboration loss - Amounts payable to Viatris $ — $ — $ 1,582 |
Summary of the reductions to R&D costs related to reimbursement payments | Year Ended December 31, (In thousands) 2021 2020 2019 Janssen $ 5,819 $ 8,554 $ 5,129 Viatris 2,072 1,524 460 Total reduction to R&D expense, net $ 7,891 $ 10,078 $ 5,589 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Information | |
Schedule of total revenue by geographic region | Year Ended December 31, (In thousands) 2021 2020 2019 US $ 55,273 $ 70,319 $ 54,760 Europe 38 1,538 18,654 Total revenue $ 55,311 $ 71,857 $ 73,414 |
Schedule of total revenue from customers or collaboration partners who individually accounted for 10% or more of total revenue | Year Ended December 31, (% of total revenue) 2021 2020 2019 Viatris 79 % 63 % 44 % Janssen 21 % 37 % 42 % Pfizer — — 14 % |
Cash, Cash Equivalents, and R_2
Cash, Cash Equivalents, and Restricted Cash (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Cash, Cash Equivalents, and Restricted Cash | |
Schedule of reconciliation of cash, cash equivalents, and restricted cash | December 31, (In thousands) 2021 2020 2019 Cash and cash equivalents $ 89,959 $ 81,467 $ 58,064 Restricted cash 837 833 833 Total cash, cash equivalents, and restricted cash shown on the consolidated statements of cash flows $ 90,796 $ 82,300 $ 58,897 |
Investments and Fair Value Me_2
Investments and Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Investments and Fair Value Measurements | |
Schedule of available-for-sale securities | December 31, 2021 Gross Gross Amortized Unrealized Unrealized Estimated (In thousands) Cost Gains Losses Fair Value US government securities Level 1 $ 29,986 $ — $ (2) $ 29,984 Corporate notes Level 2 5,034 — (2) 5,032 Commercial paper Level 2 48,490 1 (1) 48,490 Marketable securities 83,510 1 (5) 83,506 Money market funds Level 1 50,228 — — 50,228 Total $ 133,738 $ 1 $ (5) $ 133,734 December 31, 2020 Gross Gross Amortized Unrealized Unrealized Estimated (In thousands) Cost Gains Losses Fair Value US government securities Level 1 $ 75,036 $ 34 $ — $ 75,070 US government agency securities Level 2 74,971 18 — 74,989 Corporate notes Level 2 5,046 — (1) 5,045 Commercial paper Level 2 56,374 1 (5) 56,370 Marketable securities 211,427 53 (6) 211,474 Money market funds Level 1 — — — — Total $ 211,427 $ 53 $ (6) $ 211,474 |
Schedule of Available for sale debt securities with unrealized losses | December 31, 2021 Less than 12 Months Greater than 12 Months Total Gross Gross Gross Estimated Unrealized Estimated Unrealized Estimated Unrealized (In thousands) Fair Value Losses Fair Value Losses Fair Value Losses US government securities $ 19,991 $ (2) $ — $ — $ 19,991 $ (2) Corporate notes 5,031 (2) — — 5,031 (2) Commercial paper 9,995 (1) — — 9,995 (1) Total $ 35,017 $ (5) $ — $ — $ 35,017 $ (5) December 31, 2020 Less than 12 Months Greater than 12 Months Total Gross Gross Gross Estimated Unrealized Estimated Unrealized Estimated Unrealized (In thousands) Fair Value Losses Fair Value Losses Fair Value Losses Corporate notes $ 5,045 $ (1) $ — $ — $ 5,045 $ (1) Commercial paper 39,375 (5) — — 39,375 (5) Total $ 44,420 $ (6) $ — $ — $ 44,420 $ (6) |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt | |
Schedule of debt | December 31, (In thousands) 2021 2020 9.5% Non-Recourse 2035 Notes: Principal amount $ 413,291 $ 418,572 Less: (20,665) (20,929) Unamortized debt issuance costs - (3,062) (3,847) Unamortized debt issuance costs - Modified (1,265) (1,589) 388,299 392,207 3.25% Convertible 2023 Notes: Principal amount 230,000 230,000 Unamortized debt issuance costs (1,965) (3,037) 228,035 226,963 Total debt $ 616,334 $ 619,170 |
Schedule of debt interest expense | Year Ended December 31, (In thousands) 2021 2020 2019 Stated coupon interest $ 44,707 $ 42,625 $ 28,811 Amortization of debt issuance costs 2,182 1,960 3,051 Total debt interest expense $ 46,889 $ 44,585 $ 31,862 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Lessee, Lease, Description [Line Items] | |
Summary of supplemental balance sheet information related to leases | (In thousands) Classification December 31, 2021 December 31, 2020 Assets Operating lease assets Operating lease assets $ 39,690 $ 43,260 Liabilities Current: Operating lease liabilities Operating lease liabilities $ 503 $ 9,867 Non-current: Operating lease liabilities Long-term operating lease liabilities 52,681 47,220 Total operating lease liabilities $ 53,184 $ 57,087 |
Summary of components of lease expense | Year Ended Year Ended Year Ended (In thousands) Classification December 31, 2021 December 31, 2020 December 31, 2019 Operating lease expense Selling, general and administrative expense $ 6,248 $ 7,974 $ 7,959 Operating lease expense Research and development expense 1,377 758 164 Total operating lease expense (1) $ 7,625 $ 8,732 $ 8,123 Year Ended Year Ended Year Ended (In thousands) Classification December 31, 2021 December 31, 2020 December 31, 2019 Operating sublease income Selling, general and administrative expense $ 466 $ — $ — (1) Excludes short-term leases which were not material and office lease service-related charges. |
Summary of cash information related to leases | Year Ended Year Ended (In thousands) December 31, 2021 December 31, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 8,971 $ 3,804 |
Summary of maturities of lease liabilities | (In thousands) Year ending December 31: 2022 $ 9,390 2023 9,655 2024 9,865 2025 10,133 2026 10,425 Thereafter 36,552 Total operating lease payments $ 86,020 Less: Estimated tenant improvement allowance (10,214) Less: Imputed interest (22,622) Present value of operating lease liabilities $ 53,184 |
Sublease | |
Lessee, Lease, Description [Line Items] | |
Summary of maturities of lease liabilities | (In thousands) Year ending December 31: 2022 $ 1,717 2023 1,768 2024 1,821 2025 1,876 2026 1,932 Thereafter 3,516 Total operating sublease receipts $ 12,630 |
Theravance Respiratory Compan_2
Theravance Respiratory Company, LLC (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Theravance Respiratory Company, LLC | |
Summary financial information | Year Ended December 31, (In thousands) 2021 2020 2019 Current assets $ 93,275 $ 63,027 $ 36,737 Non-current assets 37,695 16,959 — Current liabilities 252 508 3,069 Royalty revenue and gross profit 126,688 73,089 42,790 Revenue from collaborative arrangements for the period ended — 10,000 — Income from continuing operations 122,732 80,477 39,410 Net income $ 121,191 $ 81,662 $ 39,653 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property and Equipment | |
Schedule of property and equipment | December 31, (In thousands) 2021 2020 Computer equipment $ 2,341 $ 2,314 Software 2,063 2,076 Furniture and fixtures 3,605 3,812 Laboratory equipment 20,087 29,753 Leasehold improvements 24,053 24,275 Subtotal 52,149 62,230 Less: accumulated depreciation (38,492) (45,808) Property and equipment, net $ 13,657 $ 16,422 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Share-Based Compensation | |
Schedule of share-based compensation expense included in the consolidated statements of operations | Year Ended December 31, (In thousands) 2021 2020 2019 Research and development $ 25,634 $ 31,294 $ 28,953 Selling, general and administrative 28,065 31,682 31,497 Restructuring and related expenses 8,362 — — Total share-based compensation expense $ 62,061 $ 62,976 $ 60,450 |
Schedule of share-based compensation expense by award type included in the consolidated statements of operations | Year Ended December 31, (In thousands) 2021 2020 2019 Innoviva equity: Options $ — $ — $ — RSUs — — — RSAs — — 64 Performance RSAs — — — Theravance Biopharma equity: Options 5,473 6,536 6,381 RSUs 54,931 49,803 39,520 Performance RSAs and RSUs 763 3,943 12,717 ESPP 894 2,694 1,768 Total share-based compensation expense $ 62,061 $ 62,976 $ 60,450 |
Schedule of unrecognized compensation cost, net of expected forfeitures, and the estimated weighted-average amortization period, using the straight-line attribution method | Unrecognized Weighted ‑ Average Compensation Amortization Period (In thousands, except amortization period) Cost (Years) Theravance Biopharma equity: Options $ 4,535 1.98 RSUs 88,220 2.77 Performance RSAs and RSUs (1) 795 2.37 ESPP 1 0.70 Total $ 93,551 (1) Represents unrecognized share-based compensation cost associated with the Company’s performance-contingent awards described above that are probable of vesting. |
Summary of option activity under the 2013 EIP and 2014 NEEIP | Number of Shares Weighted-Average Exercise Price of Aggregate Subject to Remaining Contractual Outstanding Options Intrinsic Value Outstanding Options Term (Years) (in dollars) (in thousands) Outstanding at December 31, 2020 3,299,179 $ 24.58 Granted 230,750 18.85 Exercised (275) 16.76 Forfeited (658,086) 22.41 Outstanding at December 31, 2021 2,871,568 4.63 24.62 $ 1,070 Exercisable at December 31, 2021 3.95 867 Vested and expected to vest at December 31, 2021 4.62 1,070 2021 2020 2019 Weighted average fair value of options (in dollars) $ 9.25 $ 11.03 $ 10.20 Total intrinsic value of options exercised (in thousands) $ 1 $ 384 $ 822 |
Schedule of RSU and RSA activity (including performance RSUs and RSAs) | Number of Shares Number of Shares Subject to Outstanding Subject to Outstanding RSUs Performance Conditions (RSAs) Outstanding at December 31, 2020 4,993,918 414,000 Granted 7,850,175 — Released (2,682,186) (414,000) Forfeited (1,808,058) — Outstanding at December 31, 2021 8,353,849 — |
Schedule of range of assumptions used to estimate the fair value of share options granted and rights granted | Year Ended December 31, 2021 2020 2019 Options Risk-free interest rate 0.5% - 1.2% 0.3% - 1.7% 1.6% - 2.5% Expected term (in years) 5.3 - 6.1 5.2 - 6.1 6.0 Volatility 52% - 53% 50% - 53% 51% - 53% Dividend yield — — — Weighted-average estimated fair value $ 9.25 $ 11.03 $ 10.20 2013 ESPP Risk-free interest rate 0.03% - 0.2% 0.1% - 0.2% 1.5% - 2.4% Expected term (in years) 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Volatility 40% - 79% 53% - 76% 40% - 48% Dividend yield — — — Weighted-average estimated fair value $ 3.52 $ 8.04 $ 6.17 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Taxes | |
Schedule of components of the loss before income taxes | Year Ended December 31, (In thousands) 2021 2020 2019 Income (loss) before provision for income taxes: Cayman Islands $ — $ 37,567 $ 11,779 United States (16,568) (46,500) (99,225) Ireland (182,775) (277,105) (154,217) United Kingdom (234) (499) (14) Total $ (199,577) $ (286,537) $ (241,677) |
Schedule of the components of the provision for income taxes | Year Ended December 31, (In thousands) 2021 2020 2019 Provision for income tax benefit (expense): Current: Cayman Islands $ — $ — $ — United States 173 8,545 5,210 Ireland (8) (13) — United Kingdom (14) (12) 12 Subtotal 151 8,520 5,222 Deferred — — — Total $ 151 $ 8,520 $ 5,222 Effective tax rate 0.08 % 2.97 % 2.16 % |
Schedule of the differences between the Irish statutory income tax rate and the Company's effective tax rates | Year Ended December 31, 2021 2020 2019 Provision at statutory income tax rate 25.00 % 25.00 % 25.00 % Foreign rate differential (10.52) (11.49) (6.96) Share-based compensation (4.14) 0.75 (1.17) Non-deductible executive compensation (1.62) (0.63) (0.51) Uncertain tax positions (5.25) (1.26) (0.63) Research and development tax credit carryforwards 2.38 1.83 2.50 Intangible asset 2.44 10.01 — Change in valuation allowance (7.62) (20.56) (14.90) Other (0.59) (0.68) (1.17) Effective tax rate 0.08 % 2.97 % 2.16 % |
Significant components of the Company's deferred tax assets and liabilities | December 31, (In thousands) 2021 2020 Deferred tax assets: Net operating loss carryforwards $ 115,606 $ 82,821 Capital loss carryforwards 19,409 19,409 Research and development tax credit carryforwards 28,372 24,075 Fixed assets and intangibles 287,177 310,187 Share-based compensation 10,432 15,087 Accruals 3,590 8,145 Operating lease liabilities 11,607 11,662 Other 10,505 346 Subtotal 486,698 471,732 Valuation allowance (477,868) (462,711) Total deferred tax assets 8,830 9,021 Deferred tax liabilities: Operating lease assets (8,575) (8,680) Prepaid assets (254) (341) Total deferred tax liabilities (8,830) (9,021) Net deferred tax assets (liabilities) $ — $ — |
Reconciliation of unrecognized tax benefits | (In thousands) Unrecognized tax benefits as of December 31, 2019 $ 58,763 Gross decrease in tax positions for prior years (8,059) Gross increase in tax positions for current year 12,743 Unrecognized tax benefits as of December 31, 2020 63,447 Gross decrease in tax positions for prior years (395) Gross increase in tax positions for current year 11,971 Unrecognized tax benefits as of December 31, 2021 $ 75,023 |
Corporate Restructuring (Tables
Corporate Restructuring (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Corporate Restructuring | |
Schedule of information related to accrued restructuring, severance costs and one-time termination | (In thousands) Balance at December 31, 2020 $ — Net accruals 11,867 Cash paid (2,317) Balance at December 31, 2021 $ 9,550 |
Organization and Summary of S_4
Organization and Summary of Significant Accounting Policies - Segment Reporting (Details) | 12 Months Ended |
Dec. 31, 2021segment | |
Organization and Summary of Significant Accounting Policies | |
Number of business segments | 1 |
Organization and Summary of S_5
Organization and Summary of Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Furniture and fixtures | Minimum | |
Property and Equipment | |
Estimated useful life | 5 years |
Furniture and fixtures | Maximum | |
Property and Equipment | |
Estimated useful life | 7 years |
Software and computer equipment | Minimum | |
Property and Equipment | |
Estimated useful life | 3 years |
Software and computer equipment | Maximum | |
Property and Equipment | |
Estimated useful life | 5 years |
Organization and Summary of S_6
Organization and Summary of Significant Accounting Policies - Capitalized Software (Details) - Capitalized Software - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property and Equipment | ||
Capitalized costs software implementation | $ 0 | $ 0 |
Estimated useful life | 5 years |
Organization and Summary of S_7
Organization and Summary of Significant Accounting Policies - Impairment of Long-Lived Assets (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Organization and Summary of Significant Accounting Policies | |||
Impairments of long-lived assets | $ 0 | $ 0 | $ 0 |
Organization and Summary of S_8
Organization and Summary of Significant Accounting Policies - Allowance for Doubtful Accounts (Details) | Dec. 31, 2021 | Jul. 10, 2020 |
TRC | ||
Allowance for Doubtful Accounts | ||
Percentage of equity interest | 85.00% | 85.00% |
Organization and Summary of S_9
Organization and Summary of Significant Accounting Policies - Advertising Expenses (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Organization and Summary of Significant Accounting Policies | |||
Advertising expenses | $ 9.3 | $ 6.3 | $ 2.4 |
Organization and Summary of _10
Organization and Summary of Significant Accounting Policies - Income Taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Organization and Summary of Significant Accounting Policies | |||
US federal, state and foreign unrecognized tax benefits | $ 75,023 | $ 63,447 | $ 58,763 |
Organization and Summary of _11
Organization and Summary of Significant Accounting Policies - Net Loss per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Numerator: | |||||||||||
Net loss | $ (32,034) | $ (35,308) | $ (52,405) | $ (79,679) | $ (58,434) | $ (73,643) | $ (62,887) | $ (83,053) | $ (199,426) | $ (278,017) | $ (236,455) |
Denominator: | |||||||||||
Weighted-average ordinary shares outstanding | 69,518 | 62,808 | 56,452 | ||||||||
Less: weighted-average ordinary shares subject to forfeiture | (57) | (463) | (842) | ||||||||
Weighted-average shares used to compute basic net loss per share | 69,461 | 62,345 | 55,610 | ||||||||
Weighted-average shares used to compute diluted net loss per share | 69,461 | 62,345 | 55,610 | ||||||||
Basic net loss per share | $ (0.43) | $ (0.48) | $ (0.80) | $ (1.24) | $ (0.92) | $ (1.16) | $ (1) | $ (1.40) | $ (2.87) | $ (4.46) | $ (4.25) |
Diluted net loss per share | $ (0.43) | $ (0.48) | $ (0.80) | $ (1.24) | $ (0.92) | $ (1.16) | $ (1) | $ (1.40) | $ (2.87) | $ (4.46) | $ (4.25) |
Organization and Summary of _12
Organization and Summary of Significant Accounting Policies - Net Loss per Share - Anti-dilutive (Details) - shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Anti-Dilutive Securities | |||
Anti-dilutive securities (in shares) | 14,145,000 | 13,229,000 | 13,253,000 |
Share issuances under equity incentive plans and ESPP | |||
Anti-Dilutive Securities | |||
Anti-dilutive securities (in shares) | 7,469,000 | 6,553,000 | 6,577,000 |
Share issuances upon the conversion of convertible senior notes | |||
Anti-Dilutive Securities | |||
Anti-dilutive securities (in shares) | 6,676,000 | 6,676,000 | 6,676,000 |
Performance-based vesting | |||
Anti-Dilutive Securities | |||
Anti-dilutive securities (in shares) | 0 | 0 | 414,000 |
Organization and Summary of _13
Organization and Summary of Significant Accounting Policies - Related Parties (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
GSK | |||
Related party transactions | |||
Ordinary shares held (in percent) | 13.00% | ||
Member board of directors | |||
Related party transactions | |||
Fees incurred related to related party | $ 0.5 | $ 0.5 | $ 0.4 |
NDA Group | |||
Related party transactions | |||
Ordinary shares held (in percent) | 0.85% |
Organization and Summary of _14
Organization and Summary of significant accounting policies - GSK Notes (Details) - GSK Notes | Jun. 22, 2020USD ($)$ / sharesshares |
Principal amount | $ | $ 280,336,000 |
Exchangeable to ordinary shares | shares | 9,644,792 |
Shares issued on conversion of Notes | shares | 9,644,807 |
Percentage of principal amount of debt (as a percent) | 108.50% |
Initial exchange ratio | 34.4044 |
Denomination for conversion of debt | $ | $ 1,000 |
Initial exchange price | $ / shares | $ 29.066 |
Premium over volume weighted average price (as a percent) | 35.00% |
Revenue - Revenue from Collabor
Revenue - Revenue from Collaborative Arrangements (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Collaboration revenue recognized in the period from: | |||
Revenue from collaborative arrangements | $ 11,463 | $ 26,464 | $ 31,245 |
Janssen | |||
Collaboration revenue recognized in the period from: | |||
Revenue from collaborative arrangements | 11,425 | 26,426 | 31,096 |
Other | |||
Collaboration revenue recognized in the period from: | |||
Revenue from collaborative arrangements | 38 | 38 | 154 |
Collaborative revenue | |||
Collaboration revenue recognized in the period from: | |||
Revenue from collaborative arrangements | $ 11,463 | $ 26,464 | $ 31,250 |
Revenue - Janssen Biotech Agree
Revenue - Janssen Biotech Agreement (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
Feb. 28, 2018 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Collaborative Arrangements and Co-Promote Agreement | ||||||||||||
Revenues | $ 14,946 | $ 13,194 | $ 12,914 | $ 14,257 | $ 18,730 | $ 18,257 | $ 15,008 | $ 19,862 | $ 55,311 | $ 71,857 | $ 73,414 | |
Percentage of profit share | 33.00% | 35.00% | ||||||||||
Revenue from collaborative arrangements | $ 11,463 | 26,464 | 31,245 | |||||||||
Research and development | 193,657 | 260,953 | 219,248 | |||||||||
Janssen | ||||||||||||
Collaborative Arrangements and Co-Promote Agreement | ||||||||||||
Upfront payment receivable | $ 100,000 | 100,000 | ||||||||||
Percentage of profit share | 67.00% | |||||||||||
Revenue from collaborative arrangements | 11,425 | 26,426 | 31,096 | |||||||||
Research and development | $ 18,300 | $ 38,500 | $ 39,900 | |||||||||
Janssen | Collaborative Arrangement | ||||||||||||
Collaborative Arrangements and Co-Promote Agreement | ||||||||||||
Upfront payment receivable | $ 100,000 | |||||||||||
Janssen | Collaborative Arrangement | Izencitinib | ||||||||||||
Collaborative Arrangements and Co-Promote Agreement | ||||||||||||
Collaborative arrangement, opt in fee | $ 200,000 |
Revenue - Development and Comme
Revenue - Development and Commercialization Agreement (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||||
Mar. 31, 2020 | Jun. 30, 2019 | Feb. 28, 2018 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2016 | |
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Milestone payment | $ 14,946,000 | $ 13,194,000 | $ 12,914,000 | $ 14,257,000 | $ 18,730,000 | $ 18,257,000 | $ 15,008,000 | $ 19,862,000 | $ 55,311,000 | $ 71,857,000 | $ 73,414,000 | ||||
Percentage of profit share | 33.00% | 35.00% | |||||||||||||
YUPELRI Monotherapy | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Milestone payment | $ 15,344,000 | $ 13,806,000 | $ 14,621,000 | $ 12,908,000 | $ 13,550,000 | $ 12,960,000 | $ 10,589,000 | $ 12,880,000 | |||||||
Mylan | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Percentage of profit share | 65.00% | ||||||||||||||
Viatris | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Milestone payment | $ 1,500,000 | ||||||||||||||
Upfront payment receivable | $ 18,500,000 | ||||||||||||||
Percentage of profit share | 65.00% | ||||||||||||||
Viatris | Revefenacin Monotherapy (TD-4208) | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Initial cash payment | $ 15,000,000 | ||||||||||||||
Milestone payment | $ 160,000,000 | ||||||||||||||
Transaction price | $ 15,000,000 | ||||||||||||||
Viatris | YUPELRI Monotherapy | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Milestone payment | 9,000,000 | ||||||||||||||
Viatris | YUPELRI Monotherapy | Development and Commercialization Agreement | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Milestone payment | 160,000,000 | ||||||||||||||
Viatris | Future potential combination products | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Milestone payment | 7,500,000 | 45,000,000 | |||||||||||||
Viatris | Sales milestones | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Milestone payment | 37,500,000 | 205,000,000 | |||||||||||||
Viatris | Sales milestones | YUPELRI Monotherapy | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Milestone payment | 150,000,000 | ||||||||||||||
Viatris | Regulatory actions | YUPELRI Monotherapy | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Milestone payment | $ 10,000,000 | ||||||||||||||
Viatris | Development and Sales Milestones | Future potential combination products | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Milestone payment | $ 54,000,000 | ||||||||||||||
Pfizer | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Initial cash payment | 10,000,000 | ||||||||||||||
Number of performance obligations | 2 | ||||||||||||||
Pfizer | Sales milestones | |||||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||||
Milestone payment | $ 240,000,000 |
Revenue - Condensed Statement O
Revenue - Condensed Statement Of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Development and Collaboration Agreement | |||
Revenue from collaborative arrangements | $ 11,463 | $ 26,464 | $ 31,245 |
Viatris collaboration agreement | |||
Development and Collaboration Agreement | |||
Revenue from collaborative arrangements | $ 43,848 | 43,893 | 13,664 |
Collaboration Loss | 1,582 | ||
YUPELRI Monotherapy | |||
Development and Collaboration Agreement | |||
Percentage of net sales | 35.00% | ||
YUPELRI Monotherapy | Viatris collaboration agreement | |||
Development and Collaboration Agreement | |||
Revenue from collaborative arrangements | $ 56,700 | $ 50,000 | $ 19,300 |
Percentage of net sales | 35.00% | 35.00% | 35.00% |
Revenue - Reimbursement of R an
Revenue - Reimbursement of R and D Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Research and Development Reimbursement | |||
Total reduction to R and D expense | $ 7,891 | $ 10,078 | $ 5,589 |
Janssen | |||
Research and Development Reimbursement | |||
Total reduction to R and D expense | 5,819 | 8,554 | 5,129 |
Viatris | |||
Research and Development Reimbursement | |||
Total reduction to R and D expense | $ 2,072 | $ 1,524 | $ 460 |
Revenue - Revenue from Licensin
Revenue - Revenue from Licensing Arrangements (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||
Mar. 31, 2020 | Jun. 30, 2019 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||
Milestone payment | $ 14,946 | $ 13,194 | $ 12,914 | $ 14,257 | $ 18,730 | $ 18,257 | $ 15,008 | $ 19,862 | $ 55,311 | $ 71,857 | $ 73,414 | ||
YUPELRI Monotherapy | |||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||
Milestone payment | $ 15,344 | $ 13,806 | $ 14,621 | $ 12,908 | $ 13,550 | $ 12,960 | $ 10,589 | $ 12,880 | |||||
Viatris | |||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||
Upfront payment receivable | $ 18,500 | ||||||||||||
Milestone payment | $ 1,500 | ||||||||||||
Viatris | Sales milestones | |||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||
Milestone payment | 37,500 | 205,000 | |||||||||||
Viatris | Revefenacin Monotherapy (TD-4208) | |||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||
Milestone payment | 160,000 | ||||||||||||
Viatris | YUPELRI Monotherapy | |||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||
Milestone payment | 9,000 | ||||||||||||
Viatris | YUPELRI Monotherapy | Sales milestones | |||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||
Milestone payment | 150,000 | ||||||||||||
Viatris | Future potential combination products | |||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||
Milestone payment | 7,500 | $ 45,000 | |||||||||||
Viatris | Future potential combination products | Development and Sales Milestones | |||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||
Milestone payment | $ 54,000 | ||||||||||||
Pfizer | Sales milestones | |||||||||||||
Collaborative Arrangements and Co-Promote Agreement | |||||||||||||
Milestone payment | $ 240,000 |
Segment Information - Geographi
Segment Information - Geographic region (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment Information | |||||||||||
Total revenue | $ 14,946 | $ 13,194 | $ 12,914 | $ 14,257 | $ 18,730 | $ 18,257 | $ 15,008 | $ 19,862 | $ 55,311 | $ 71,857 | $ 73,414 |
United States | |||||||||||
Segment Information | |||||||||||
Total revenue | 55,273 | 70,319 | 54,760 | ||||||||
Europe | |||||||||||
Segment Information | |||||||||||
Total revenue | $ 38 | $ 1,538 | $ 18,654 |
Segment Information - Percentag
Segment Information - Percentage of Revenue (Details) - Total revenue - Customer concentration risk | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Viatris | |||
Segment Information | |||
Percentage of total revenues | 79.00% | 63.00% | 44.00% |
Janssen | |||
Segment Information | |||
Percentage of total revenues | 21.00% | 37.00% | 42.00% |
Pfizer | |||
Segment Information | |||
Percentage of total revenues | 0.00% | 0.00% | 14.00% |
Cash, Cash Equivalents, and R_3
Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash and cash equivalents | $ 89,959 | $ 81,467 | $ 58,064 | |
Restricted cash | 837 | 833 | 833 | |
Total cash, cash equivalents, and restricted cash shown on the condensed consolidated statements of cash flows | 90,796 | 82,300 | 58,897 | $ 378,854 |
Realized and unrealized (loss) gain on foreign currency transactions | $ (900) | $ (300) | $ 200 | |
9.5% non-recourse notes due 2035 | ||||
Interest rate (as a percent) | 9.50% |
Investments and Fair Value Me_3
Investments and Fair Value Measurements - Available-for-sale securities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Available for sale securities: | ||
Amortized Cost | $ 133,738 | $ 211,427 |
Gross Unrealized Gains | 1 | 53 |
Gross Unrealized Losses | (5) | (6) |
Estimated Fair Value | 133,734 | 211,474 |
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract] | ||
Estimated Fair Value lesser than 12 months | 35,017 | 44,420 |
Estimated Fair Value Total | 35,017 | 44,420 |
Gross unrealized lesser than 12 months | (5) | (6) |
Gross unrealized loss, Total | (5) | (6) |
Marketable securities | ||
Available for sale securities: | ||
Amortized Cost | 83,510 | 211,427 |
Gross Unrealized Gains | 1 | 53 |
Gross Unrealized Losses | (5) | (6) |
Estimated Fair Value | 83,506 | 211,474 |
U.S. government securities | ||
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract] | ||
Estimated Fair Value lesser than 12 months | 19,991 | |
Estimated Fair Value Total | 19,991 | |
Gross unrealized lesser than 12 months | (2) | |
Gross unrealized loss, Total | (2) | |
U.S. government securities | Quoted Prices in Active Markets for Identical Assets, Level 1 | ||
Available for sale securities: | ||
Amortized Cost | 29,986 | 75,036 |
Gross Unrealized Gains | 34 | |
Gross Unrealized Losses | (2) | |
Estimated Fair Value | 29,984 | 75,070 |
U.S. government agency securities | Significant Other Observable Inputs, Level 2 | ||
Available for sale securities: | ||
Amortized Cost | 74,971 | |
Gross Unrealized Gains | 18 | |
Estimated Fair Value | 74,989 | |
U.S. corporate notes | ||
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract] | ||
Estimated Fair Value lesser than 12 months | 5,031 | 5,045 |
Estimated Fair Value Total | 5,031 | 5,045 |
Gross unrealized lesser than 12 months | (2) | (1) |
Gross unrealized loss, Total | (2) | (1) |
U.S. corporate notes | Significant Other Observable Inputs, Level 2 | ||
Available for sale securities: | ||
Amortized Cost | 5,034 | 5,046 |
Gross Unrealized Losses | (2) | (1) |
Estimated Fair Value | 5,032 | 5,045 |
U.S. commercial paper | ||
Debt Securities, Available-for-sale, Unrealized Gain (Loss) [Abstract] | ||
Estimated Fair Value lesser than 12 months | 9,995 | 39,375 |
Estimated Fair Value Total | 9,995 | 39,375 |
Gross unrealized lesser than 12 months | (1) | (5) |
Gross unrealized loss, Total | (1) | (5) |
U.S. commercial paper | Significant Other Observable Inputs, Level 2 | ||
Available for sale securities: | ||
Amortized Cost | 48,490 | 56,374 |
Gross Unrealized Gains | 1 | 1 |
Gross Unrealized Losses | (1) | (5) |
Estimated Fair Value | 48,490 | $ 56,370 |
Money market funds | Quoted Prices in Active Markets for Identical Assets, Level 1 | ||
Available for sale securities: | ||
Amortized Cost | 50,228 | |
Estimated Fair Value | $ 50,228 |
Investments and Fair Value Me_4
Investments and Fair Value Measurements - Convertible senior notes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Maturity period for marketable securities | |||
Maximum contractual maturity period | 6 months | ||
Weighted average contractual maturity period | 2 months | ||
Fair value transfers | |||
Fair value of assets transferred from Level 1 to Level 2 | $ 0 | $ 0 | |
Fair value of assets transferred from Level 2 to Level 1 | 0 | 0 | |
Unrealized losses | |||
Net unrealized losses | $ 0 | ||
Available-for-sale securities sold | $ 19,900 | $ 0 |
Debt (Details)
Debt (Details) - USD ($) | Feb. 28, 2020 | Feb. 21, 2020 | Feb. 29, 2020 | Nov. 30, 2018 | Nov. 30, 2016 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Jul. 10, 2020 |
Debt Instrument [Line Items] | |||||||||
Total long-term debt | $ 616,334,000 | $ 619,170,000 | |||||||
Long-term debt interest expense | |||||||||
Stated coupon interest | 44,707,000 | 42,625,000 | $ 28,811,000 | ||||||
Amortization of debt issuance costs | 2,182,000 | 1,960,000 | 3,051,000 | ||||||
Total debt interest expense | 46,889,000 | 44,585,000 | 31,862,000 | ||||||
Loss on extinguishment of debt | 15,464,000 | ||||||||
Principal payment on notes | 10,730,000 | 235,347,000 | $ 2,152,000 | ||||||
Issuer II Class C Units | |||||||||
Long-term debt interest expense | |||||||||
Percentage of equity interest | 75.00% | ||||||||
9.5% Non-Recourse 2035 Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Principal amount | $ 400,000,000 | 413,291,000 | 418,572,000 | ||||||
Less: 5% retained by the Company | (20,665,000) | (20,929,000) | |||||||
Unamortized debt issuance costs | (3,062,000) | (3,847,000) | |||||||
Total long-term debt | $ 388,299,000 | 392,207,000 | |||||||
Long-term debt interest expense | |||||||||
Interest rate (as a percent) | 9.50% | 9.50% | |||||||
Percentage of note to be sold | 95.00% | ||||||||
Percentage of note to be retained | 5.00% | ||||||||
Net principal | $ 392,600,000 | 397,600,000 | |||||||
Estimated fair value | 373,000,000 | 399,600,000 | |||||||
9.0% Non-Recourse 2033 Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Unamortized debt issuance costs | $ (1,265,000) | (1,589,000) | |||||||
Long-term debt interest expense | |||||||||
Proceeds from issuance of debt | $ 250,000,000 | ||||||||
Interest rate (as a percent) | 9.00% | 9.00% | |||||||
Unamortized deferred financing costs | $ 1,800,000 | ||||||||
Creditors fees | $ 500,000 | $ 4,400,000 | |||||||
Third party fees | $ 300,000 | ||||||||
3.25% Convertible Senior Notes Due 2023 | |||||||||
Debt Instrument [Line Items] | |||||||||
Principal amount | $ 230,000,000 | $ 230,000,000 | 230,000,000 | ||||||
Unamortized debt issuance costs | (1,965,000) | (3,037,000) | |||||||
Total long-term debt | $ 228,035,000 | $ 226,963,000 | |||||||
Long-term debt interest expense | |||||||||
Proceeds from issuance of debt | 222,500,000 | ||||||||
Transaction costs | $ 7,500,000 | ||||||||
Interest rate (as a percent) | 3.25% | 3.25% | 3.25% | ||||||
Conversion rate, in shares | 29.0276 | ||||||||
Principal amount for conversion rate | $ 1,000 | ||||||||
Conversion price (in dollars per share) | $ 34.45 | ||||||||
Redemption price to principal amount, in percent | 100.00% | ||||||||
3.25% Convertible Senior Notes Due 2023 | Significant Other Observable Inputs, Level 2 | |||||||||
Long-term debt interest expense | |||||||||
Notes fair value | $ 220,200,000 | $ 217,900,000 | |||||||
TRC | |||||||||
Debt Instrument [Line Items] | |||||||||
Principal amount | $ 10,700,000 | ||||||||
Long-term debt interest expense | |||||||||
Percentage of economic interest | 85.00% | 85.00% | |||||||
Net interest shortfall | $ 5,700,000 | ||||||||
Percentage of equity interest | 85.00% | 85.00% | |||||||
Principal payment on notes | $ 5,000,000 | ||||||||
Net interest shortfall | 23,400,000 | ||||||||
Net principal paydown | $ 10,700,000 | ||||||||
TRC | Minimum | |||||||||
Long-term debt interest expense | |||||||||
Upward tiering royalties (as a percent) | 6.50% | ||||||||
TRC | Maximum | |||||||||
Long-term debt interest expense | |||||||||
Upward tiering royalties (as a percent) | 10.00% | ||||||||
TRC | Issuer II Class C Units | |||||||||
Long-term debt interest expense | |||||||||
Percentage of economic interest | 63.75% | ||||||||
Theravance Biopharma R&D, Inc. | 9.5% Non-Recourse 2035 Notes | |||||||||
Long-term debt interest expense | |||||||||
Interest rate (as a percent) | 5.00% | ||||||||
Theravance Biopharma R&D, Inc. | 9.0% Non-Recourse 2033 Notes | |||||||||
Long-term debt interest expense | |||||||||
Redemption price to principal amount, in percent | 5.00% |
Leases (Details)
Leases (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jul. 31, 2021USD ($)ft² | Dec. 31, 2021USD ($)ft²Optionbuilding | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Lessee, Lease, Description [Line Items] | ||||
Area of leased space | ft² | 162,000 | |||
Number of building leased | building | 2 | |||
Tenant improvement allowance | $ (10,214) | $ (12,100) | ||
Area of lease space terminated | ft² | 8,000 | |||
Decrease in operating lease assets | $ 1,100 | |||
Decrease in operating lease liabilities | 3,000 | 1,742 | $ (1,600) | $ 2,317 |
Gain on lease modification | $ 1,900 | $ 1,863 | ||
Area of subleased property | ft² | 21,000 | |||
Monthly base rent | $ 100 | |||
Increase in annual base rent (as a percent) | 3.00% | |||
Expected sublease income | $ 13,100 | |||
Premium component in sublease income | $ 3,800 | |||
Percentage of excess sublease income over lease obligations received to be shared with lessor | 50.00% | |||
Premium component in sublease income to be shared with lessor | $ 1,900 | |||
Percentage of excess sublease income over lease obligations to be retained | 50.00% | |||
Number of options to extend | Option | 2 | |||
Option to extend | true | |||
Renewal term | 5 years | |||
Ireland | ||||
Lessee, Lease, Description [Line Items] | ||||
Area of leased space | ft² | 6,100 | |||
Tenant improvement allowance | $ 10,200 | |||
Option to terminate | true |
Leases - Assets and Liabilities
Leases - Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Assets and liabilities | |||
Operating lease assets | $ 39,690 | $ 43,260 | |
Operating lease liabilities, current | 503 | $ 9,867 | |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Operating lease liabilities, current | Operating lease liabilities, current | |
Operating lease liabilities | 52,681 | $ 47,220 | |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Operating lease liabilities | Operating lease liabilities | |
Total operating lease liabilities | $ 53,184 | $ 57,087 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Lessee, Lease, Description [Line Items] | |||
Operating lease expense | $ 7,625 | $ 8,732 | $ 8,123 |
Selling, general and administrative | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease expense | 6,248 | 7,974 | 7,959 |
Operating sublease income | 466 | ||
Research and development | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease expense | $ 1,377 | $ 758 | $ 164 |
Leases - Maturity of Lease Liab
Leases - Maturity of Lease Liabilities and Other Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2018 | |
Maturity of Lease Liabilities | |||
2022 | $ 9,390 | ||
2023 | 9,655 | ||
2024 | 9,865 | ||
2025 | 10,133 | ||
2026 | 10,425 | ||
Thereafter | 36,552 | ||
Total operating lease payments | 86,020 | ||
Less: Estimated tenant improvement allowance | (10,214) | $ (12,100) | |
Less: Imputed interest | (22,622) | ||
Present value of operating lease liabilities | 53,184 | 57,087 | |
Operating cash flows from operating leases | $ 8,971 | $ 3,804 | |
Weighted-average remaining lease term (years) | 8 years 3 months 18 days | ||
Weighted-average discount rate | 8.64% | ||
Sublease | |||
Maturity of Lease Liabilities | |||
2022 | $ 1,717 | ||
2023 | 1,768 | ||
2024 | 1,821 | ||
2025 | 1,876 | ||
2026 | 1,932 | ||
Thereafter | 3,516 | ||
Total operating lease payments | $ 12,630 | ||
9.0% Non-Recourse 2033 Notes | |||
Maturity of Lease Liabilities | |||
Interest rate (as a percent) | 9.00% | 9.00% |
Theravance Respiratory Compan_3
Theravance Respiratory Company, LLC (Details) - TRC | Feb. 21, 2020 | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Jul. 10, 2020 |
Theravance Respiratory Company, LLC | |||||
Percentage of equity interest | 85.00% | 85.00% | |||
Percentage of economic interest | 85.00% | 85.00% | |||
Number of fiscal quarters | 4 | ||||
Royalty payments | $ 104,000,000 | $ 68,400,000 | $ 33,700,000 | ||
Royalty expenses | 3,400,000 | $ 2,200,000 | $ 2,700,000 | ||
Amount due | 43,500,000 | ||||
Long-term asset | 67,500,000 | ||||
Net unrealized loss | 300,000 | ||||
Payment received | $ 59,500,000 |
Theravance Respiratory Compan_4
Theravance Respiratory Company, LLC - Summary financial information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Jul. 10, 2020 | |
Summary financial information | ||||||||||||
Current assets | $ 249,870 | $ 393,341 | $ 249,870 | $ 393,341 | ||||||||
Current liabilities | 58,587 | 123,571 | 58,587 | 123,571 | ||||||||
Revenues | 14,946 | $ 13,194 | $ 12,914 | $ 14,257 | 18,730 | $ 18,257 | $ 15,008 | $ 19,862 | 55,311 | 71,857 | $ 73,414 | |
Net income | (32,034) | $ (35,308) | $ (52,405) | $ (79,679) | (58,434) | $ (73,643) | $ (62,887) | $ (83,053) | (199,426) | (278,017) | (236,455) | |
TRC | ||||||||||||
Summary financial information | ||||||||||||
Current assets | 93,275 | 63,027 | 93,275 | 63,027 | 36,737 | |||||||
Non-current assets | 37,695 | 16,959 | 37,695 | 16,959 | ||||||||
Current liabilities | $ 252 | $ 508 | 252 | 508 | 3,069 | |||||||
Income from continuing operations | 122,732 | 80,477 | 39,410 | |||||||||
Net income | $ 121,191 | 81,662 | 39,653 | |||||||||
Percentage of equity interest | 85.00% | 85.00% | 85.00% | |||||||||
TRC | Royalties | ||||||||||||
Summary financial information | ||||||||||||
Revenues | $ 126,688 | 73,089 | $ 42,790 | |||||||||
TRC | Collaborative Arrangement, Transaction with Party to Collaborative Arrangements | ||||||||||||
Summary financial information | ||||||||||||
Revenues | $ 10,000 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property and Equipment | |||
Property and equipment, gross | $ 52,149 | $ 62,230 | |
Less: accumulated depreciation | (38,492) | (45,808) | |
Property and equipment, net | 13,657 | 16,422 | |
Depreciation expense | 3,500 | 3,300 | $ 3,300 |
Proceeds from the sale of property and equipment | 6 | 64 | $ 5 |
Computer equipment | |||
Property and Equipment | |||
Property and equipment, gross | 2,341 | 2,314 | |
Software | |||
Property and Equipment | |||
Property and equipment, gross | 2,063 | 2,076 | |
Furniture and fixtures | |||
Property and Equipment | |||
Property and equipment, gross | 3,605 | 3,812 | |
Laboratory equipment | |||
Property and Equipment | |||
Property and equipment, gross | 20,087 | 29,753 | |
Leasehold improvements | |||
Property and Equipment | |||
Property and equipment, gross | 24,053 | $ 24,275 | |
Property and equipment | |||
Property and Equipment | |||
Proceeds from the sale of property and equipment | $ 1,900 |
Share-Based Compensation - Ther
Share-Based Compensation - Theravance Biopharma Equity Plans (Details) | Jun. 02, 2014plan | Dec. 31, 2014shares | Dec. 31, 2013itemshares |
Share-Based Compensation | |||
Number of plans | plan | 3 | ||
2013 Equity Incentive Plan | |||
Share-Based Compensation | |||
Shares approved for grant (in shares) | 5,428,571 | ||
2013 Equity Incentive Plan | Maximum | |||
Share-Based Compensation | |||
Shares that may be issued as percent of prior year outstanding shares | 5.00% | ||
Automatic increase in number of shares that may be issued | 3,428,571 | ||
2013 Equity Incentive Plan | Stock options | |||
Share-Based Compensation | |||
Term (in years) | 10 years | ||
Vesting period | 4 years | ||
Period of forfeiture of unvested option upon termination of service | 3 months | ||
2013 Equity Incentive Plan | Stock options | Vesting after one year | |||
Share-Based Compensation | |||
Vesting period | 1 year | ||
Vesting of RSU (as a percent) | 25.00% | ||
2013 Equity Incentive Plan | Stock options | Monthly vesting over the remaining three years | |||
Share-Based Compensation | |||
Vesting period | 3 years | ||
Vesting of RSU (as a percent) | 75.00% | ||
2013 Employee Share Purchase Plan | |||
Share-Based Compensation | |||
Shares approved for grant (in shares) | 857,142 | ||
Purchase price as a percentage of fair market value of stock | 85.00% | ||
Consecutive and overlapping offering periods | 24 months | ||
Number of purchase periods | item | 4 | ||
Duration of purchase period | 6 months | ||
Maximum contribution as percent of compensation | 15.00% | ||
2013 Employee Share Purchase Plan | Maximum | |||
Share-Based Compensation | |||
Shares that may be issued as percent of prior year outstanding shares | 1.00% | ||
Automatic increase in number of shares that may be issued | 571,428 | ||
2014 NEEIP | |||
Share-Based Compensation | |||
Shares approved for grant (in shares) | 750,000 | ||
2014 NEEIP | Stock options | |||
Share-Based Compensation | |||
Term (in years) | 10 years | ||
Vesting period | 4 years | ||
Period of forfeiture of unvested option upon termination of service | 3 months | ||
2014 NEEIP | Stock options | Vesting after one year | |||
Share-Based Compensation | |||
Vesting of RSU (as a percent) | 25.00% | ||
2014 NEEIP | Stock options | Monthly vesting over the remaining three years | |||
Share-Based Compensation | |||
Vesting of RSU (as a percent) | 75.00% |
Share-Based Compensation - Perf
Share-Based Compensation - Performance Contingent Awards (Details) $ in Thousands | Sep. 15, 2021employee | Sep. 30, 2021USD ($) | Dec. 31, 2021USD ($)employeeshares | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2016shares |
Share-Based Compensation | ||||||
Incremental Share-Based Compensation expense | $ 2,800 | |||||
Number of employees reduction in workforce | employee | 270 | |||||
Cumulative compensation cost | $ 2,800 | |||||
Total share-based compensation expense | 62,061 | $ 62,976 | $ 60,450 | |||
Research and development | ||||||
Share-Based Compensation | ||||||
Total share-based compensation expense | 25,634 | 31,294 | 28,953 | |||
Selling, general and administrative | ||||||
Share-Based Compensation | ||||||
Total share-based compensation expense | $ 28,065 | 31,682 | 31,497 | |||
Restructuring and related expenses | ||||||
Share-Based Compensation | ||||||
Incremental Share-Based Compensation expense | $ 5,600 | |||||
Number of employees reduction in workforce | employee | 160 | |||||
Total share-based compensation expense | $ 8,362 | |||||
Performance-Contingent Awards - RSAs | ||||||
Share-Based Compensation | ||||||
Shares approved for grant (in shares) | shares | 1,575,000 | |||||
Vesting period | 5 years | |||||
Total Max. Expense | $ 2,900 | |||||
Performance-Contingent Awards - RSUs | ||||||
Share-Based Compensation | ||||||
RSUs outstanding (in shares) | shares | 325,000 | |||||
Performance-Contingent Awards - RSUs | Senior management | ||||||
Share-Based Compensation | ||||||
Shares approved for grant (in shares) | shares | 135,000 | |||||
Performance-Contingent Awards - RSUs. | ||||||
Share-Based Compensation | ||||||
Total share-based compensation expense | $ 400 | 1,000 | 1,000 | |||
First tranche | ||||||
Share-Based Compensation | ||||||
Total share-based compensation expense | $ 400 | $ 3,000 | $ 1,900 |
Share-Based Compensation - Shar
Share-Based Compensation - Share Based Compensation Expense By Type (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-Based Compensation | |||
Total share-based compensation expense | $ 62,061 | $ 62,976 | $ 60,450 |
Unrecognized compensation cost | 93,551 | ||
Stock options | |||
Share-Based Compensation | |||
Total share-based compensation expense | 5,473 | 6,536 | 6,381 |
Unrecognized compensation cost | $ 4,535 | ||
Weighted-average amortization period - years | 1 year 11 months 23 days | ||
RSUs | |||
Share-Based Compensation | |||
Total share-based compensation expense | $ 54,931 | 49,803 | 39,520 |
Unrecognized compensation cost | $ 88,220 | ||
Weighted-average amortization period - years | 2 years 9 months 7 days | ||
Performance-Contingent Awards - RSAs and RSUs | |||
Share-Based Compensation | |||
Total share-based compensation expense | $ 763 | 3,943 | 12,717 |
Unrecognized compensation cost | $ 795 | ||
Weighted-average amortization period - years | 2 years 4 months 13 days | ||
ESPP | |||
Share-Based Compensation | |||
Total share-based compensation expense | $ 894 | $ 2,694 | 1,768 |
Unrecognized compensation cost | $ 1 | ||
Weighted-average amortization period - years | 8 months 12 days | ||
Theravance | RSAs | |||
Share-Based Compensation | |||
Total share-based compensation expense | $ 64 |
Share-Based Compensation - Comp
Share-Based Compensation - Compensation Awards (Details) - 2013 EIP and 2014 NEEIP - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Number of Shares Subject To Outstanding Options | |||
Balance at the beginning of the year | 3,299,179 | ||
Granted ( in shares) | 230,750 | ||
Exercised (in shares) | (275) | ||
Forfeited (in shares) | (658,086) | ||
Balance at the end of the year | 2,871,568 | 3,299,179 | |
Weighted-Average Exercise Price of Outstanding Options | |||
Balance at the beginning of the year (in dollars per share) | $ 24.58 | ||
Granted (in dollars per share) | 18.85 | ||
Exercised (in dollars per share) | 16.76 | ||
Forfeited (in dollars per share) | 22.41 | ||
Balance at the end of the year (in dollars per share) | $ 24.62 | $ 24.58 | |
Additional disclosures | |||
Weighted-Average Remaining Contractual Term (Years), Outstanding | 4 years 7 months 17 days | ||
Weighted-Average Remaining Contractual Term (Years), Exercisable | 3 years 11 months 12 days | ||
Weighted-Average Remaining Contractual Term (Years), Vested and expected to vest | 4 years 7 months 13 days | ||
Aggregate intrinsic value of options outstanding | $ 1,070 | ||
Aggregate intrinsic value of options exercisable | $ 867 | ||
Weighted-average estimated fair value (in dollars per share) | $ 9.25 | $ 11.03 | $ 10.20 |
Aggregate intrinsic value of vested or expected to vest | $ 1,070 | ||
Total intrinsic value of options exercised | $ 1 | $ 384 | $ 822 |
Share-Based Compensation - RSU
Share-Based Compensation - RSU and RSA activity (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
RSUs | ||
RSU and RSA activity ( including Performance RSUs and RSAs) | ||
Outstanding at beginning of year | 4,993,918 | |
Granted (in shares) | 7,850,175 | |
Released (in shares) | (2,682,186) | |
Forfeited (in shares) | (1,808,058) | |
Outstanding at end of year | 8,353,849 | 4,993,918 |
Additional disclosures | ||
Total estimated fair value of RSUs vested | $ 49.3 | $ 52.8 |
Performance-Contingent Awards - RSAs | ||
RSU and RSA activity ( including Performance RSUs and RSAs) | ||
Outstanding at beginning of year | 414,000 | |
Released (in shares) | (414,000) | |
Outstanding at end of year | 414,000 |
Share-Based Compensation - Valu
Share-Based Compensation - Valuation Assumptions (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stock options | |||
Weighted-average assumptions | |||
Risk-free interest rate, minimum (as a percent) | 0.50% | 0.30% | 1.60% |
Risk-free interest rate, maximum (as a percent) | 1.20% | 1.70% | 2.50% |
Expected term (in years) | 6 years | ||
Expected volatility, minimum (as a percent) | 52.00% | 50.00% | 51.00% |
Expected volatility, maximum (as a percent) | 53.00% | 53.00% | 53.00% |
Weighted-average estimated fair value (in dollars per share) | $ 9.25 | $ 11.03 | $ 10.20 |
Minimum | Stock options | |||
Weighted-average assumptions | |||
Expected term (in years) | 5 years 3 months 18 days | 5 years 2 months 12 days | |
Maximum | Stock options | |||
Weighted-average assumptions | |||
Expected term (in years) | 6 years 1 month 6 days | 6 years 1 month 6 days | |
2013 Employee Share Purchase Plan | |||
Weighted-average assumptions | |||
Risk-free interest rate, minimum (as a percent) | 0.03% | 0.10% | 1.50% |
Risk-free interest rate, maximum (as a percent) | 0.20% | 0.20% | 2.40% |
Expected volatility, minimum (as a percent) | 40.00% | 53.00% | 40.00% |
Expected volatility, maximum (as a percent) | 79.00% | 76.00% | 48.00% |
Weighted-average estimated fair value (in dollars per share) | $ 3.52 | $ 8.04 | $ 6.17 |
2013 Employee Share Purchase Plan | Minimum | |||
Weighted-average assumptions | |||
Expected term (in years) | 6 months | 6 months | 6 months |
2013 Employee Share Purchase Plan | Maximum | |||
Weighted-average assumptions | |||
Expected term (in years) | 2 years | 2 years | 2 years |
Income Taxes - Components of lo
Income Taxes - Components of loss before income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Taxes | |||
Loss before income taxes | $ (199,577) | $ (286,537) | $ (241,677) |
Cayman Islands | |||
Income Taxes | |||
Loss before income taxes | 37,567 | 11,779 | |
United States | |||
Income Taxes | |||
Loss before income taxes | (16,568) | (46,500) | (99,225) |
Ireland | |||
Income Taxes | |||
Loss before income taxes | (182,775) | (277,105) | (154,217) |
United Kingdom | |||
Income Taxes | |||
Loss before income taxes | $ (234) | $ (499) | $ (14) |
Income Taxes - Components of pr
Income Taxes - Components of provision for income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Provision for income tax benefit (expense) | |||
Current | $ 151 | $ 8,520 | $ 5,222 |
Income tax benefit | $ 151 | $ 8,520 | $ 5,222 |
Effective tax rate (as a percent) | 0.08% | 2.97% | 2.16% |
Provision for income taxes on undistributed earnings of foreign subsidiaries | $ 0 | ||
Undistributed earnings | $ 0 | ||
United States | |||
Provision for income tax benefit (expense) | |||
Current | 173 | 8,545 | $ 5,210 |
Ireland | |||
Provision for income tax benefit (expense) | |||
Current | $ (8) | $ (13) | |
Effective tax rate (as a percent) | 0.08% | 2.97% | 2.16% |
United Kingdom | |||
Provision for income tax benefit (expense) | |||
Current | $ (14) | $ (12) | $ 12 |
Income Taxes - Irish statutory
Income Taxes - Irish statutory rate reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
The differences between the U.S. federal statutory income tax rate to the Company's effective tax rate | |||
Effective tax rate (as a percent) | 0.08% | 2.97% | 2.16% |
Ireland | |||
The differences between the U.S. federal statutory income tax rate to the Company's effective tax rate | |||
Provision at statutory income tax rate (as a percent) | 25.00% | 25.00% | 25.00% |
Foreign rate differential (as a percent) | (10.52%) | (11.49%) | (6.96%) |
Share-based compensation (as a percent) | (4.14%) | 0.75% | (1.17%) |
Non-deductible executive compensation (as a percent) | (1.62%) | (0.63%) | (0.51%) |
Uncertain tax positions (as a percent) | (5.25%) | (1.26%) | (0.63%) |
Research and development tax credit carryforwards (as a percent) | 2.38% | 1.83% | 2.50% |
Intangible asset | 2.44% | 10.01% | |
Change in valuation allowance (as a percent) | (7.62%) | (20.56%) | (14.90%) |
Other (as a percent) | (0.59%) | (0.68%) | (1.17%) |
Effective tax rate (as a percent) | 0.08% | 2.97% | 2.16% |
Income Taxes - Deferred income
Income Taxes - Deferred income taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Components of Deferred Tax Assets [Abstract] | ||
Net operating loss carryforwards | $ 115,606 | $ 82,821 |
Capital loss carryforwards | 19,409 | 19,409 |
Research and development tax credit carryforwards | 28,372 | 24,075 |
Fixed assets and intangibles | 287,177 | 310,187 |
Share-based compensation | 10,432 | 15,087 |
Accruals | 3,590 | 8,145 |
Operating lease liabilities | 11,607 | 11,662 |
Other | 10,505 | 346 |
Subtotal | 486,698 | 471,732 |
Valuation allowance | (477,868) | (462,711) |
Total deferred tax assets | 8,830 | 9,021 |
Deferred tax liabilities: | ||
Operating lease assets | (8,575) | (8,680) |
Prepaid assets | (254) | (341) |
Total deferred tax liabilities | (8,830) | (9,021) |
Information related to valuation allowance | ||
Valuation allowance | 477,868 | $ 462,711 |
Ireland | ||
Information related to valuation allowance | ||
Net operating loss carryforwards | 739,600 | |
Research and Development | ||
Components of Deferred Tax Assets [Abstract] | ||
Net operating loss carryforwards | 260,100 | |
Capital loss carryforwards | Ireland | ||
Information related to valuation allowance | ||
R&D tax credit | 58,800 | |
Federal | ||
Components of Deferred Tax Assets [Abstract] | ||
Net operating loss carryforwards | 305,000 | |
Federal | Research and Development | ||
Components of Deferred Tax Assets [Abstract] | ||
Research and development tax credit carryforwards | 24,700 | |
State | ||
Components of Deferred Tax Assets [Abstract] | ||
Net operating loss carryforwards | 90,400 | |
State | Research and Development | ||
Components of Deferred Tax Assets [Abstract] | ||
Research and development tax credit carryforwards | $ 23,400 |
Income Taxes - Uncertain Tax Po
Income Taxes - Uncertain Tax Positions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Gross unrecognized tax benefits | ||
Unrecognized tax benefits at the beginning of the period | $ 63,447 | $ 58,763 |
Gross decrease in tax positions for prior years | (395) | (8,059) |
Gross increase in tax positions for current year | 11,971 | 12,743 |
Unrecognized tax benefits at the end of the period | $ 75,023 | $ 63,447 |
Income Taxes - US Tax Reform (D
Income Taxes - US Tax Reform (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Income Taxes | |||
Unrecognized Tax Benefits | $ 75,023 | $ 63,447 | $ 58,763 |
Commitments and Contingencies -
Commitments and Contingencies - Performance-Contingent Awards (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2016 | |
Commitments and Contingencies | ||||
Guarantees and Indemnifications Liability | $ 0 | |||
Long-Term Retention and Incentive Cash Bonus Awards | Employee | ||||
Commitments and Contingencies | ||||
Service-based vesting period | 5 years | |||
Long-Term Retention and Incentive Cash Bonus Awards | Third tranche | ||||
Commitments and Contingencies | ||||
Cash bonus awards recognized | $ 0.4 | $ 3.3 | $ 14.2 |
Public Offering of Ordinary S_2
Public Offering of Ordinary Shares - (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 29, 2021 | Dec. 31, 2021 | Dec. 31, 2020 |
Subsidiary, Sale of Stock [Line Items] | |||
Number of shares issued | 7,705,000 | ||
Share price (in dollars per share) | $ 15 | ||
Proceeds from sale of ordinary shares | $ 115,600 | $ 108,180 | $ 139,915 |
Over allotment option | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of shares issued | 1,005,000 | ||
Option to purchase additional shares, number of days | 30 days | ||
Public Offering | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of shares issued | 6,700,000 |
Corporate Restructuring (Detail
Corporate Restructuring (Details) $ in Thousands | Nov. 30, 2021 | Sep. 15, 2021employee | Mar. 31, 2022USD ($) | Dec. 31, 2021USD ($) |
Corporate Restructuring | ||||
Reduction in workforce (as a percent) | 75.00% | 75.00% | ||
Number of employees reduction in workforce | employee | 270 | |||
Cash expenses related to the costs of employee severance | $ 17,000 | |||
Restructuring costs | 20,142 | |||
Non-cash charges related to modification of equity-awards for terminated and remaining employee | 15,000 | |||
Forecast | ||||
Corporate Restructuring | ||||
Cash expenses related to the costs of employee severance | $ 12,000 | |||
Restructuring costs | 5,000 | |||
Non-cash charges related to modification of equity-awards for terminated and remaining employee | $ 7,000 | |||
Research and development | ||||
Corporate Restructuring | ||||
Restructuring costs | 10,600 | |||
Selling, general and administrative | ||||
Corporate Restructuring | ||||
Restructuring costs | 9,500 | |||
Severance | ||||
Corporate Restructuring | ||||
Cash expenses related to the costs of employee severance | 11,500 | |||
Employee-related separation costs | 20,100 | |||
Non-cash charges related to modification of equity-awards for terminated and remaining employee | 8,600 | |||
Minimum | ||||
Corporate Restructuring | ||||
Employee-related separation costs | $ 32,000 |
Corporate Restructuring - Accru
Corporate Restructuring - Accrued restructuring, severance costs and one-time termination costs (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Restructuring Reserve [Roll Forward] | |
Net accruals | $ 11,867 |
Cash paid | (2,317) |
Balance at December 31, 2021 | $ 9,550 |
SUPPLEMENTARY FINANCIAL DATA _2
SUPPLEMENTARY FINANCIAL DATA (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
Feb. 28, 2018 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Total revenue | $ 14,946 | $ 13,194 | $ 12,914 | $ 14,257 | $ 18,730 | $ 18,257 | $ 15,008 | $ 19,862 | $ 55,311 | $ 71,857 | $ 73,414 | |
Costs and expenses | 71,113 | 66,809 | 77,024 | 98,149 | 95,220 | 94,872 | 87,184 | 92,338 | 313,095 | 369,614 | 325,329 | |
Loss from operations | (56,167) | (53,615) | (64,110) | (83,892) | (76,490) | (76,615) | (72,176) | (72,476) | (257,784) | (297,757) | (251,915) | |
Net loss | $ (32,034) | $ (35,308) | $ (52,405) | $ (79,679) | $ (58,434) | $ (73,643) | $ (62,887) | $ (83,053) | $ (199,426) | $ (278,017) | $ (236,455) | |
Basic net loss per share | $ (0.43) | $ (0.48) | $ (0.80) | $ (1.24) | $ (0.92) | $ (1.16) | $ (1) | $ (1.40) | $ (2.87) | $ (4.46) | $ (4.25) | |
Diluted net loss per share | $ (0.43) | $ (0.48) | $ (0.80) | $ (1.24) | $ (0.92) | $ (1.16) | $ (1) | $ (1.40) | $ (2.87) | $ (4.46) | $ (4.25) | |
Percentage of profit share | 33.00% | 35.00% | ||||||||||
YUPELRI Monotherapy | ||||||||||||
Total revenue | $ 15,344 | $ 13,806 | $ 14,621 | $ 12,908 | $ 13,550 | $ 12,960 | $ 10,589 | $ 12,880 | ||||
Percentage of Net Sales | 35.00% | |||||||||||
Mylan | ||||||||||||
Percentage of profit share | 65.00% |